PROBLEMS OF ENFORCEMENT OF FLOATING CHARGE IN NIGERIA

Nkolo, Ezechi Cyril (2022) PROBLEMS OF ENFORCEMENT OF FLOATING CHARGE IN NIGERIA. Law and Social Justice Review (LASJURE), 3 (1). pp. 143-152.

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Abstract

Finance is a very fundamental requirement for any business. Sequel to this, companies are allowed to borrow money for the purpose of executing their businesses in accordance with the statutory provisions and their memorandum and articles of association. Lenders in order to ensure that they recoup their money where the borrower company is unable to pay their debts will normally demand the security which they can dispose to recoup their money. This gave rise to charges on the property of such companies. There are two major forms of charges, fixed charge and floating charge. This article examines the problems of the enforcement of a floating charge in Nigeria. The paper vigorously demonstrates that there are certain statutory provisions which constitute problems in the enforcement of floating charge in Nigeria. These include preferential creditors which affect the priority of floating charges, defective floating charge which affects its validity, the requirement of applications to court for direction by the receiver/manager for every steps he takes in the performance of his function, cost of liquidation which diminishes the assets available for the floating charge holders. It is recommended that floating charge as a form of security should be preserved sequel to its freedom for the debtor to dispose of the property secured in ordinary course of business and .the attachment of the charge to after acquired property of the company falling within the description of the security

Item Type: Article
Subjects: K Law > K Law (General)
Divisions: Faculty of Law, Arts and Social Sciences > School of Law
Depositing User: Uchenna Eneogwe
Date Deposited: 23 May 2025 11:18
Last Modified: 23 May 2025 11:18
URI: http://eprints.gouni.edu.ng/id/eprint/4641

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