Nigerian Banking Law Reports

NIGERIAN BANKING LAW REPORTS

[2004 – 2006]

VOLUME 13 PART III

To be cited as: [2004 – 2006] 13 N.B.L.R. PART III

Nigeria Deposit Insurance Corporation

Nigeria Deposit Insurance Corporation Plot 447/448 Airport Road Central Business District P.M.B. 284, Garki Abuja, Federal Capital Territory [FCT] Nigeria Tel: +23495237715–6, +523696740–44

Members of the LexisNexis Group worldwide South Africa LexisNexis (Pty) Ltd DURBAN 215 Peter Mokaba Road (North Ridge Road), Morningside, Durban, 4001 JOHANNESBURG Building No. 9, Harrowdene Office Park, 124 Western Service Road, Woodmead, 2191 CAPE TOWN Office Floor 2, North Lobby, Boulevard Place, Heron Close, Century City, 7441 www.lexisnexis.co.za Australia LexisNexis, CHATSWOOD, New South Wales Austria LexisNexis Verlag ARD Orac, VIENNA Benelux LexisNexis Benelux, AMSTERDAM Canada LexisNexis Canada, MARKHAM, Ontario China LexisNexis, BEIJING France LexisNexis, PARIS Germany LexisNexis Germany, MÜNSTER Hong Kong LexisNexis, HONG KONG India LexisNexis, NEW DELHI Italy Giuffrè Editore, MILAN Japan LexisNexis, TOKYO Korea LexisNexis, SEOUL Malaysia LexisNexis, KUALA LUMPUR New Zealand LexisNexis, WELLINGTON Poland LexisNexis Poland, WARSAW Singapore LexisNexis, SINGAPORE United Kingdom LexisNexis, LONDON USA LexisNexis, DAYTON, Ohio

© 2013 Nigeria Deposit Insurance Corporation, published by LexisNexis (Pty) Ltd under licence ISSN 1595–1030 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, including electronic, mechanical, photocopying and recording, without the written permission of the copyright holder, application for which should be addressed to the publisher. Such written permission must also be obtained before any part of this publication is stored in a retrieval system of any nature. Whilst every effort has been made to ensure that the information published in this work is accurate, the editors, publishers and printers take no responsibility for any loss or damage suffered by any person as a result of the reliance upon the information contained therein.

EDITORIAL BOARD

1. Professor J.O. Anifalaje Chairman Faculty of Law, University of Ibadan 2. Alheri Bulus Nyako Editor–in– Chief Board Secretary/Director Legal Department N.D.I.C. 3. Michael Olufemi Olaitan Member Legal Practitioner 4. Gabriel Olukayode Kembi Member Legal Practitioner 5. Adekunle Oladapo Omowole Member Legal Practitioner Director Corporate Affairs Commission 6. Nasiru Tijani Member Legal Practitioner Director Nigerian Law School 7. Belema A. Taribo Member Legal Practitioner N.D.I.C. 8. Dan Ike Agwu Secretary Legal Practitioner N.D.I.C.

iii

LIST OF JUSTICES OF THE SUPREME COURT OF NIGERIA AS AT 31ST JULY, 2013

1. HON. JUSTICE ALOMA MARIAM MUKHTAR (Chief Justice of Nigeria) 2. HON. JUSTICE MAHMUD MOHAMMED 3. HON. JUSTICE WALTER SAMUEL NKANU ONNOGHEN 4. HON. JUSTICE IBRAHIM TANKO MUHAMMAD 5. HON. JUSTICE CHRISTOPHER MITCHELL CHUKWUMA–ENEH, CON 6. HON. JUSTICE MUHAMMAD S. MUNTAKA COOMASIE 7. HON. JUSTICE JOHN AFOLABI FABIYI 8. HON. JUSTICE SULEIMAN GALADIMA 9. HON. JUSTICE BODE RHODE VIVOUR 10. HON. JUSTICE NWALE SYLVESTER NGWUTA 11. HON. JUSTICE MARY PETER ODILI 12. HON. JUSTICE OLUKAYODE ARIWOOLA 13. HON. JUSTICE CLARA BATA OGUNBIYI 14. HON. JUSTICE MUSA DATTIJO MUHAMMAD 15. HON. JUSTICE KUMAI BAYANG AKAAHS 16. HON. JUSTICE STANLEY SHENKO ALAGOA

SENIORITY LIST OF JUSTICES OF THE COURT OF APPEAL AS AT 31ST JULY, 2013

1. HON. JUSTICE ZAINAB ADAMU BULKACHUWA (President) 2. HON. JUSTICE AMINAT ADAMU AUGIE 3. HON. JUSTICE IBRAHIM MOHAMMED MUSA SAULAWA 4. HON. JUSTICE CHIMA CENTUS NWEZE 5. HON. JUSTICE JOSEPH SHAGBOR IKYEGH 6. HON. JUSTICE RITA NOSAKHARE PEMU 7. HON. JUSTICE CHINWE EUGENIA IYIZOBA 8. HON. JUSTICE FATIMA O. AKINBAMI 9. HON. JUSTICE DALHATU ADAMU, CFR 10. HON. JUSTICE ABDU ABOKI 11. HON. JUSTICE THERESA NGOLIKA ORJI–ABADUA 12. HON. JUSTICE ITA GEORGE MBABA 13. HON. JUSTICE H.A. ABIRU 14. HON. JUSTICE MONICA B. DONGBAN–MENSEM 15. HON. JUSTICE CHIDI NWAOMA UWA 16. HON. JUSTICE ADAMU JAURO 17. HON. JUSTICE O.O. DANIEL–KALIO 18. HON. JUSTICE ABUBAKAR JEGA ABDULKADIR 19. HON. JUSTICE MOJEED ADEKUNLE OWOADE 20. HON. JUSTICE ISAIAH OLUFEMI AKEJU 21. HON. JUSTICE E. AGIM 22. HON. JUSTICE OLADEINDE GEORGE SHOREMI

v [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

23. HON. JUSTICE HELEN MORONKEJI OGUNWUNMIJU 24. HON. JUSTICE SIDI DAUDA BAGE 25. HON. JUSTICE AYOBODE OLUJIMI LOKULO–SODIPE 26. HON. JUSTICE TOM SHUAIBU YAKUBU 27. HON. JUSTICE RAPHAEL CHIKWE AGBO 28. HON. JUSTICE OYEBISI FOLAYEMI OMOLEYE 29. HON. JUSTICE JUMMAI HANNATU SANKEY 30. HON. JUSTICE P.O. IGE 31. HON. JUSTICE I.S. BDLIYA 32. HON. JUSTICE MOHAMMED LADAN TSAMIYA 33. HON. JUSTICE EJEMBI EKO 34. HON. JUSTICE C.E. NWOSU IHEME 35. HON. JUSTICE M. FASANMI 36. HON. JUSTICE JONAH ADAH 37. HON. JUSTICE AMIRU SANUSI 38. HON. JUSTICE ABUBAKAR DATTI YAHAYA 39. HON. JUSTICE REGINA OBIAGELI NWODO 40. HON. JUSTICE MOORE A.A. ADUMIEN 41. HON. JUSTICE T. AKOMOLAFE–WILSON 42. HON. JUSTICE MOHAMMAD LAWAL GARBA 43. HON. JUSTICE UZO I. NDUKWE–ANYANWU 44. HON. JUSTICE JOSEPH TINE TUR 45. HON. JUSTICE O.A. OTISI 46. HON. JUSTICE PAUL ADAMU GALINJE 47. HON. JUSTICE HUSSEIN MUKHTAR 48. HON. JUSTICE OBANDE F. OGBUINYA 49. HON. JUSTICE T. ABUBAKAR 50. HON. JUSTICE UWANI MUSA ABBA AJI 51. HON. JUSTICE JOHN INYANG OKORO 52. HON. JUSTICE PHILOMEN MBUA EKPE 53. HON. JUSTICE HARUNA MOHAMMED TSAMMANI vi [2004 – 2006] 13 N.B.L.R. (PART III)

Seniority List of Justices of the Court

54. HON. JUSTICE TIJJANI ABDULLAHI 55. HON. JUSTICE AHMAD OLAREWAJU BELGORE 56. HON. JUSTICE TUNDE OYEBANJI AWOTOYE 57. HON. JUSTICE J.S. ABIRIYI 58. HON. JUSTICE SOTONYE DENTON–WEST 59. HON. JUSTICE IGNATIUS IGWE AGUBE 60. HON. JUSTICE ABUBAKAR ALKALI ABBA 61. HON. JUSTICE JIMI OLUKAYODE BADA 62. HON. JUSTICE MASSOUD ABDULRAHMAN OREDOLA 63. HON. JUSTICE UCHECHUKWU ONYEMENAN 64. HON. JUSTICE KUDIRAT M. O. KEKERE–EKUN 65. HON. JUSTICE JAFARU MIKA’ILU 66. HON. JUSTICE A.GANA MISHELIA 67. HON. JUSTICE SAMUEL CHUKWUDUMEBI OSEJI 68. HON. JUSTICE MUHAMMAD AMBI–USI DANJUMA

vii

SENIORITY LIST OF JUSTICES OF THE FEDERAL HIGH COURT OF NIGERIA AS AT 30TH NOVEMBER, 2007

1. HON. JUSTICE I.N. AUTA (Chief Judge) 2. HON. JUSTICE A. ABDUL–KAFARATI 3. HON. JUSTICE O. J. OKEKE 4. HON. JUSTICE S. YAHAYA 5. HON. JUSTICE ADAMU BELLO 6. HON. JUSTICE P. F. OLAYIWOLA 7. HON. JUSTICE ADAMU A. HOBON 8. HON. JUSTICE J. T. TSOHO 9. HON. JUSTICE GLADYS K. OLOTU 10. HON. JUSTICE J. E. SHAKARHO 11. HON. JUSTICE L. AKANBI 12. HON. JUSTICE C. M. OLATOREGUN–ISOLA 13. HON. JUSTICE BINTA F. M. NYAKO 14. HON. JUSTICE A. M. LIMAN 15. HON. JUSTICE S. YAHUZA 16. HON. JUSTICE A. I. CHIKERE 17. HON. JUSTICE M. I. SHUAIBU 18. HON. JUSTICE SALIU SAIDU 19. HON. JUSTICE A. O. FAJI 20. HON. JUSTICE G. O. KOLAWOLE 21. HON. JUSTICE B. BELLO ALIYU 22. HON. JUSTICE A. F. A. ADEMOLA 23. HON. JUSTICE M. I. AWOKULEHIN 24. HON. JUSTICE R. N. OFILI–AJUMOGOBIA 25. HON. JUSTICE A. L. ALLAGOA 26. HON. JUSTICE I. N. BUBA 27. HON. JUSTICE A. O. OGIE 28. HON. JUSTICE B. O. KUEWUMI 29. HON. JUSTICE M. G. UMAR viii [2004 – 2006] 13 N.B.L.R. (PART III)

Seniority List of Justices of the Federal High Court

30. HON. JUSTICE A. R. MOHAMMED 31. HON. JUSTICE R. M. AIKAWA 32. HON. JUSTICE P. I. AJOKU 33. HON. JUSTICE S. M. SHUAIBU 34. HON. JUSTICE A. A. OKEKE 35. HON. JUSTICE Z. B. ABUBAKAR 36. HON. JUSTICE I. M. SANI 37. HON. JUSTICE S. E. CHUKWU 38. HON. JUSTICE I. E. EKWO 39. HON. JUSTICE M. B. IDRIS 40. HON. JUSTICE MUHAMMED TANKO SALIHU 41. HON. JUSTICE MAUREEN ADAOBI ONYETENU 42. HON. JUSTICE OKON EFRETI ABANG 43. HON. JUSTICE DORCAS VENENGE AGISHI 44. HON. JUSTICE MUHAMMED SHITTU ABUBAKAR 45. HON. JUSTICE ISAH BATURE GAFAI 46. HON. JUSTICE FOLASHADE ADEJOKE OLUBANJO 47. HON. JUSTICE MUHAMMED NASIR YUNUSA 48. HON. JUSTICE IJEOMA LUCIA OJUKWU 49. HON. JUSTICE BABATUNDE OLAIDE QUADRI 50. HON. JUSTICE BABA GANA–ASHIGAR 51. HON. JUSTICE EMMANUEL A. OBILE 52. HON. JUSTICE CHUKWU JEKWU JOSEPH ANEKE 53. HON. JUSTICE D. U. OKOROWO 54. HON. JUSTICE PHOEBA M. AYUA 55. HON. JUSTICE NATHANIEL AYO–EMMANUEL 56. HON. JUSTICE SULEIMAN I. ALIYU 57. HON. JUSTICE MOHAMMED L. ABUBAKAR 58. HON. JUSTICE F.O. GIWA–OGUNBANJO 59. HON. JUSTICE MUSA HARUNA KURYA 60. HON. JUSTICE EVELYN N. ANYADIKE

ix [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

61. HON. JUSTICE UCHE MMA AGOMOH 62. HON. JUSTICE OLUREMI O. OGUNTOYINBO 63. HON. JUSTICE NGANYIWA H. AJIYA 64. HON. JUSTICE CHINDA R. S. ADELE 65. HON. JUSTICE FATU O. RIMAN

THE NIGERIAN BANKING SYSTEM

1. The Development of Banking in Nigeria The historical development of the financial system in Nige- ria dates back to 1892 when modern banking business commenced and a formal and institutional channel of saving mobilization was introduced into the economy with the establishment of the African Banking Corporation (“ABC”). The operation of ABC was later taken over in 1894 by the British Bank of West Africa (which later became Standard Bank) and subsequently, First Bank of Nigeria. Owing to the colonial heritage, the pioneer commercial banks in Nigeria were of foreign origin and their operations favoured finance of foreign trade and commerce. Thereafter, several other foreign and a host of indigenous banks were established. The establishment of indigenous banks was initially propelled largely by nationalistic con- sciousness rather than the existence of relevant resources, including basic skilled manpower, for running such institutions. Consequently, most of the early indigenous banks collapsed in rapid succession. Banks that failed during the early stage of the evolution of the Nigerian financial system were largely those with problems of inadequate capital, poor management, and fraudulent practices, among other factors. An important feature of the Nigerian financial system, especially before the establishment of the Central Bank of Nigeria (“CBN”), was small scope of operations of participating foreign institutions and the complete absence of any form of institutional regulatory framework which would provide the necessary guide for both the operations and orderly development of the system. These were some of the reasons behind the slow development of the financial system during the pre-CBN era. The situation however changed from 1958 when the CBN was established. Since then, series of efforts have been made xi [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports by the CBN and other relevant authorities to promote the growth and development of the Nigerian financial system. For example, the need to develop the system and create an avenue for investment of short term funds informed the issue by the CBN in 1960 of Treasury Bills as a supplement to Commercial Papers that were already in the market. Other money market instruments after the establishment of the CBN but prior to the introduction of the Structural Adjust- ment Programme (“SAP”) in 1986 included Treasury Cer- tificates in 1968, Certificates of Deposit in 1975 and the Bankers’ Unit Fund as well as Stabilisation Securities in 1976. The establishment of the CBN also aided the development of the capital market. This was achieved by ensuring the emergence of the securities markets and instruments (primary and secondary) and by promoting the establishment of development banks. Following the adoption of the SAP in 1986, and the subsequent deregulation of the financial system, the banking system witnessed radical changes. Apart from the introduction of measures and instruments to deregulate the financial services industry, the techniques and the range of products offered by the industry changed significantly. The major objective of the deregulation was to enhance economic efficiency and effective resource allocation through service- driven competition and improvement in quality and spread of financial services delivery. On July 6th, 2004 the Governor of CBN announced a banking reform programme aimed at strengthening and consolidating the banking system. The reform is expected to address the safety of depositor’s funds, enable the banking sector play an active developmental role in the economy and transform Nigerian banks into competitive players in the African and Global financial system.

2. The Nigeria Deposit Insurance Corporation One of the key measures introduced during the era of deregulation of the banking sector was the establishment of the xii [2004 – 2006] 13 N.B.L.R. (PART III)

The Nigerian Banking System

Nigeria Deposit Insurance Corporation (“NDIC”), with the promulgation of Decree No. 22 of 1988 now Cap 301 Laws of the Federation 1990 (as amended). The NDIC was established to insure all the deposit liabilities of licensed banks, promote banking stability and a sound financial system. Although the NDIC enabling Act was promulgated in 1988, the Corporation only commenced operations in March, 1989. The Nigeria Deposit Insurance Corporation scheme was introduced to provide a further layer of protection to depositors and complement the role of prudent bank management as well as the Central Bank of Nigeria’s (“CBN”) supervisory activities in ensuring a safe and sound banking system. It was also considered as an additional framework to serve as a vehicle for addressing some of the challenges that followed the deregulation of the financial system under the SAP. Prior to the establishment of the NDIC, the Govern- ment had played the role of what in industry parlance is referred to as an implicit insurer, by bailing out troubled banks in its bid to protect depositors. With deregulation, an explicit Deposit Insurance Scheme (“DIS”) became imperative. The establishment of NDIC was also informed by the change in government bank-support policy, the bitter experiences of prior bank failures in Nigeria and the lessons of other countries with bank deposit insurance schemes. The scheme aims at increasing the competitive efficiency of the banking system as well as reducing the system’s vulnerabil- ity to destructive runs, panic-induced shocks by reinforcing depositors’ confidence in the nation’s financial system. The mission of the Corporation is to protect depositors through effective supervision of insured institutions, provision of financial and technical assistance to eligible insured institutions, prompt payment of guaranteed sums and the orderly resolution of failed financial institutions. The Corporation currently acts as the Liquidator of thirty four (34) banks out of a total of thirty six (36) banks whose operating licenses were revoked by the Governor of the CBN. All depositors of the banks in liquidation who have xiii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports come forward to file their claims have been paid their insured deposits while liquidation dividends making up 100% of total uninsured deposits have been declared and paid to depositors of ten (10) banks in Liquidation. In September 1997, the Corporation commenced publication of the Failed Banks Tribunals Law Reports (“FBTLR”) which contained only reported decisions of the Tribunal established under the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act, 1994 and decisions of the Special Appeal Tribunal established under the Recovery of Public Property (Special Military Tribunal) Decree, 1984. In 1999, with the return to civil rule, the Corporation re- structured the publication into a compendium of decisions of all banking matters given by our superior courts of record from 1933 to date. This gave rise to the birth of the Nigerian Banking Law Reports (“N.B.L.R.”). Nigeria Deposit Insurance Corporation November, 2005

xiv

FOREWORD

Banking is the most important sub-sector of the economy of any nation. Banks facilitate economic transactions between various national and international economic units and by so doing encourage trade, commerce and industry. It is widely acknowledged that a sound and efficient finance industry, of which banks constitute the major segment, would promote growth of the real sector while the opposite is the case if the financial sector is repressed and inefficient. Therefore, the Law of Banking assumes a position of pre-eminence in economic development and this underscores the importance of a Law Report on the subject. The efforts of the Nigeria Deposit Insurance Corporation in the development of the Law of Banking through the publication of a banking law report started over 8 years ago. It would be recalled that in September, 1997, the Corporation launched the Failed Banks Tribunal Law Reports (“FBTLR”) at the International Conference Centre, Abuja. Although the Failed Banks Law Reports were short-lived following the advent of civil rule in 1999, they nonetheless served as a veritable reference material for Judges, Legal Practitioners, Jurists, Bankers, Students and the general public. It is for the foregoing reason that when the Corporation decided to expand the scope of the publication by including the decisions of the Supreme Court and the Court of Appeal on banking matters and re-named it the Nigerian Banking Law Reports (“N.B.L.R.”), I did not hesitate in giving my consent. The N.B.L.R. is a compendium of case law on Nigerian banking from 1933 to date. The first batch of the compendium contains cases decided between 1933–2002 which I understand would continue to 2004. Thereafter, the reports would be published regularly. This initiative will prove invaluable to users who would not have to wade through xv [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports different law reports when conducting research on Nigerian banking case law. The publication of the N.B.L.R. is one reliable means of disseminating information and knowledge of banking law and practices to depositors and other members of the public as part of the Corporation’s contribution to safe and sound banking practices. Hence, it is well known that the Corpora- tion did not embark upon publication of the N.B.L.R. in order to make profit. Specialized law reports are very rare mainly because of the tedium, great expenses, time and labour required to produce them. However, when available, such reports generate considerable public interest. I am therefore pleased that the presentation of the Nigerian Banking Law Reports has become a reality. The laudable decision of the Management of the NDIC to shoulder this onerous burden for the Nigerian Banking industry is a practical example of the social as well as corporate responsibilities expected of modern Corpora- tions. I have no doubt in my mind that the publication will en- dure and I am therefore pleased to recommend the Nigerian Banking Law Report, which is a worthy and befitting legacy for posterity, especially the world of learning, to all and sundry.

Hon. Justice Mohammed Lawal Uwais, GCON Chief Justice of Nigeria November, 2005

xvi

PREFACE TO THE NIGERIAN BANKING LAW REPORTS

The decision of the Nigeria Deposit Insurance Corporation to publish the Nigerian Banking Law Report has its origin from its involvement in the implementation of the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act 1994. The Law was promulgated by the then Military Government with the combined objectives of re- covering the debts owed to failed banks and prosecuting directors, officers and customers of banks who were sus- pected to have committed banking malpractices, which led to the collapse of most of the failed banks. Furthermore, in 1994, when the Corporation was appointed as the Liquidator to carry out the liquidation of some failed banks, it was observed that there were hardly any records relating to the winding up of banks that had failed in the past. There was also no sufficient data on the causes of the past bank failures. The Corporation therefore took the initiative, in September, 1997 to report and publish decisions of the Failed Banks Tribunal established under the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act, 1994. This effort culminated into the publication of the Failed Banks Tribunal Law Reports (“FBTLR”). Thus, the Corporation was motivated by the need to place on permanent record the lessons from the new wave of bank failures/distress, particularly with regard to the causes of such failures/distress and efforts made to resolve such failures. Hitherto, the absence of proper documentation relating to the bank failures experiences in the early fifties had made it exceedingly difficult for practitioners and researchers to make references to such failures. The decision to publish the FBTLR was to ensure that the mistakes of the past were not repeated, through elaborate documentation of the recent failures, the essence of which were captured in the decisions of the Failed Banks Tribunal. xvii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

However, with the return to democratic rule in May, 1999, the Failed Banks Act was amended by the Tribunals (Certain Consequential Amendment, etc.) No. 62 of 1999, which abrogated the Tribunal. The civil and criminal jurisdictions of the Tribunal were accordingly transferred to the Federal High Court. Consequently, the title of the Publication was changed to Nigerian Banking Law Reports. Furthermore, in response to the new democratic dispensation, the Corporation decided to expand the scope of the publication into a compendium containing decisions of the Supreme Court, Court of Appeal as well as Federal and State High Courts on banking matters from 1933 to date in order to provide a comprehensive data base for all banking related cases decided by the superior courts of record. Also in order not to miss the tremendous achievements recorded by the Failed Banks Tribunal during their relatively short tenure, their decisions have been included in the compendium thereby making the N.B.L.R. very comprehensive. In addition, there is an index for the compendium up to 2002, which would soon be updated to 2004 and thereafter, it would be published on regular basis. It is therefore my hope that legal practitioners, my Lords the honourable justices and judges, distinguished scholars and law professors, bankers, students and the general public would find this initiative useful. I would like to express my profound appreciation to the Editorial Board of the Nigerian Banking Law Reports under the distinguished chairmanship of Professor Anifalaje, an erudite professor of law and the Dean of the Faculty of Law, University of Ibadan ably assisted by seasoned Legal Practi- tioners and staff of the Legal Department of the Corporation, for their patriotic commitment, diligence and ingenuity for details, that went into the production of the N.B.L.R.. They left no stone unturned in bringing the Corporation’s dream of making this worthy contribution to legal knowledge and research a reality. Their commitment in ensuring the com- pletion of the project is highly commendable. xviii [2004 – 2006] 13 N.B.L.R. (PART III)

Preface to the Nigerian Banking Law Reports

Management will on its part do everything possible to ensure that publication of the Nigerian Banking Law Reports (N.B.L.R.) is sustained. G.A. Ogunleye, OFR Managing Director/Chief Executive November, 2005

xix

TABLE OF CONTENTS

Page Index of Table of Cases Reported ...... xxiii Index of Subject Matter...... xxv Index of Nigerian Cases referred to...... xxxiii Index of Foreign Cases referred to ...... lv Index of Nigerian Statutes referred to ...... lvii Index of Foreign Statutes referred to...... lxi Index of Nigerian Rules of Court referred to...... lxiii Index of Books referred to...... lxv

xxi

TABLE OF CASES REPORTED

Page 1. ACB Plc v Nwanna Trading Stores (Nig) Ltd 143 2. Agbabiaka v First Bank of Nigeria Plc 177 3. Associated Discount House Ltd v Amalgamated Trustees Ltd 115 4. Balogun v Egba Onikolobo Community Bank (Nig) Ltd 343 5. Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another 1 6. Bunnex (Nig) Ltd v Ivory Merchant Bank Ltd 262 7. Eagle Super Pack (Nig) Ltd v ACB Plc 310 8. Ethiopian Airlines v Afribank Nigeria Plc 245 9. Ezomo v New Nigeria Bank Plc and another 75 10. Integrated Timber and Plywood Products Ltd v UBN Plc 218 11. Lamboyo Ltd v. New Nigeria Bank Plc 128 12. Ogunlade v. Federal Mortgage Bank of Nig Ltd 201 13. Olori Motors Company Ltd v Union Bank of Nigeria Plc 40 14. Standard Trust Bank Ltd v. Interdrill Nig Ltd 279 15. UBN Plc v. Ifeoluwa Nigeria Enterprises 297 16. UBA Plc v. BTL Industries Ltd 369

xxiii

INDEX OF SUBJECT MATTER

BANKING Bank – Definition of Associated Discount House Ltd v Amalgamated Trustees Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 115 Bank failing to advance or disburse loan as agreed – Right of borrower Bunnex (Nig) Ltd v Ivory Mer- chant Bank Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 262 Bank not paying overseas suppliers of customer – Goods already received by customer – Customer claiming refund – Whether customer has the standing to sue UBA Plc v. BTL Industries Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 369 Banker/customer relationship – Breach of contract and negligence – Within jurisdiction of State High Court UBA Plc v. BTL Industries Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 369 Banker/customer relationship – Dispute in relation to recovery of loan – What to consider ACB Plc v Nwanna Trading Stores (Nig) Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 143 Banker/customer relationship – Essence of Lamboyo Ltd v. New Nigeria Bank Plc [2004 – 2006] 13 N.B.L.R. (Part III) 128 Banker/customer relationship – How formed – Nature of – Jurisdiction of Federal and State High Courts Inte- grated Timber and Plywood Products Ltd v UBN Plc [2004 – 2006] 13 N.B.L.R. (Part III) 218 Banker/customer relationship – Nature of Standard Trust Bank Ltd v. Interdrill Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 279; UBN Plc v. Ifeoluwa Nige- ria Enterprises [2004 – 2006] 13 N.B.L.R. (Part III) 297 xxv [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Banker/customer relationship – Simple contract – Subject to Limitation Law Ethiopian Airlines v Afribank Ni- geria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 245 Contracts – Loan of money – Agreement on fixed date for disbursement – Default by lender – Escalation in costs – Measure of damages recoverable Brokenn Agro Al- lied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 Contracts – Loan of money – Lenders failure to produce fund – Measure of damages Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 Contracts under NERFUND – Statutory flavour – Section 5(1) National Economic Reconstruction Fund Decree No. 2 of 1989 (as amended) Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 Customer – Who is Integrated Timber and Plywood Products Ltd v UBN Plc [2004 – 2006] 13 N.B.L.R. (Part III) 218 Evidence of officer of bank – Not in employment at the time of transaction – Whether admissible Standard Trust Bank Ltd v. Interdrill Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 279 Interest – Award of – Attitude of court UBN Plc v. Ifeo- luwa Nigeria Enterprises [2004 – 2006] 13 N.B.L.R. (Part III) 297 Interest – Central Bank Guidelines – Whether court to take judicial notice of – Attitude of court UBN Plc v. Ifeoluwa Nigeria Enterprises [2004 – 2006] 13 N.B.L.R. (Part III) 297 Interest – Definition of – Failure to plead agreed interest rate – Effect of Standard Trust Bank Ltd v. Interdrill Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 279 Interest – Main source of bank’s income – When payable – Principles applicable Agbabiaka v First Bank of

[2004 – 2006] 13 N.B.L.R. (PART III)

Index of Subject Matter

Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 177 Interest – Right of bank to charge – Principles governing Balogun v. Egba Onikolobo Community Bank (Nig) Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 343 International commercial transaction – Principles governing UBA Plc v. BTL Industries Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 369 Loan recovery – Need for bank to tender bank statement Bunnex (Nig) Ltd v Ivory Merchant Bank Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 262 Loan under NERFUND Act – Breach of agreement by participating bank – Effect of Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 Proof of debt – How done Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 Uniform customs and practice for documentary credit – Applicability of in Nigeria – Principle governing Ea- gle Super Pack (Nig) Ltd v ACB Plc [2004 – 2006] 13 N.B.L.R. (Part III) 310 Uniform customs and practice for documentary credit – To be specifically incorporated into parties contract – Where not done – Effect Eagle Super Pack (Nig) Ltd v ACB Plc [2004 – 2006] 13 N.B.L.R. (Part III) 310

DAMAGES Award of damages for breach of contract – Object of Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 Measure of damages – Loan of money – Lenders failure to produce the fund – Damages recoverable Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 xxvii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

DISCOUNT HOUSE Whether a bank Associated Discount House Ltd v Amal- gamated Trustees Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 115

EVIDENCE Agreement reduced to writing – Varying of by oral testimony – Whether permissible – Section 131(1) Evi- dence Act Cap 112 Laws of the Federation of Nigeria, 1990 Bunnex (Nig) Ltd v Ivory Merchant Bank Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 262 Competent witness – Section 155(1) Evidence Act Cap. 112 Laws of the Federation of Nigeria, 1990 Stan- dard Trust Bank Ltd v. Interdrill Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 279 Of officer of bank – Not in employment at the time of transaction – Whether admissible – Who is Standard Trust Bank Ltd v. Interdrill Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 279 Proof of debt – How done Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1

JURISDICTION Banker/customer relationship – Breach of contract and negligence – Within jurisdiction of State High Court UBA Plc v. BTL Industries Limited [2004 – 2006] 13 N.B.L.R. (Part III) 369 Federal High Court – Simple contract – Not that of Fed- eral High Court Integrated Timber and Plywood Products Ltd v UBN Plc [2004 – 2006] 13 N.B.L.R. (Part III) 218

LIMITATION LAW Banker/customer relationship – Subject to Limitation Law – Principle governing Ethiopian Airlines v Afribank

[2004 – 2006] 13 N.B.L.R. (PART III)

Index of Subject Matter

Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 245 Cause of action – When time begins to run – Principles applicable UBA Plc v. BTL Industries Limited [2004 – 2006] 13 N.B.L.R. (Part III) 369

LIS PENDENS Doctrine of – Principles governing Ezomo v New Nigeria Bank Plc and another [2004 – 2006] 13 N.B.L.R. (Part III) 75 Mortgagee obtaining judgment – Debtor filing an appeal and stay of execution – Notices of not served on creditor – Creditor selling mortgaged property – Whether a case of lis pendens Olori Motors Company Ltd v Union Bank of Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 40 Mortgagee obtaining judgment against mortgagor – Thereafter purporting to sell property in exercise of his power of sale under the mortgaged deed – Propri- ety of Olori Motors Company Ltd v Union Bank of Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 40 Persons buying property pendete lite – Effect Ezomo v New Nigeria Bank Plc and another [2004 – 2006] 13 N.B.L.R. (Part III) 75 Principles governing Olori Motors Company Ltd v Union Bank of Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 40

LOCUS STANDI Bank not paying overseas suppliers of customer – Goods already received by customer – Customer claiming refund – Whether customer has the standing to sue UBA Plc v. BTL Industries Limited [2004 – 2006] 13 N.B.L.R. (Part III) 369 xxix [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

MORTGAGE Interest rate – Variation of rate – Irregular notice served by mortgagee – Mortgagor not reacting – Effect Ogunlade v. Federal Mortgage Bank of Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 201 Interest – Variation of rate – Right of mortgagee Ogunlade v. Federal Mortgage Bank of Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 201 Mortgagee obtaining judgment – Later selling property under the mortgage deed – Propriety of Olori Motors Company Ltd v Union Bank of Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 40 Sale of property – Notice to be given to mortgagor in writing – Sections 125(1) and 192(1) Property and Conveyancing Law of Bendel State of Nigeria, 1976 Ezomo v New Nigeria Bank Plc and another [2004 – 2006] 13 N.B.L.R. (Part III) 75

NERFUND Contract thereunder – Statutory flavour – Section 5(1)(a) National Economic Reconstruction Fund Decree No. 2 of 1989 (as amended) Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1 “Shall” in section 5(1)(a) National Economic Reconstruc- tion Fund Decree No. 2 of 1989 (as amended) – Meaning of Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1

PRACTICE AND PROCEDURE Pleadings – Insufficient traverse – What amounts to – De- fendant “cannot admit or deny Plaintiff’s allegation” – Meaning of Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another [2004 – 2006] 13 N.B.L.R. (Part III) 1

[2004 – 2006] 13 N.B.L.R. (PART III)

Index of Subject Matter

WORD AND PHRASES Bank Associated Discount House Ltd v Amalgamated Trustees Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 115 Customer – Who is Integrated Timber and Plywood Prod. Ltd v. UBN Plc [2004 – 2006] 13 N.B.L.R. (Part III) 218 Waiver – Defined Ogunlade v. Federal Mortgage Bank of Nig Ltd [2004 – 2006] 13 N.B.L.R. (Part III) 201 Lis pendens – Meaning of Olori Motors Company Ltd v Union Bank of Nigeria Plc [2004 – 2006] 13 N.B.L.R. (Part III) 40

xxxi

INDEX OF NIGERIAN CASES REFERRED TO

Page 7UP Bottling Co Ltd v Abiola and Sons (Nig) Ltd (1995) 3 NWLR (Part 383) 257 SC 177

A Abdullahi v Oba (1998) 6 NWLR (Part 554) 420 75 ACB Ltd v Adebesin and Co Ltd (1999) 1 NWLR (Part 585) 128 Adah v NYSC (2004) 13 NWLR (Part 891) 639; (2004) 7 SC (Part 11) 139 369 Adejuwon v Co-operative Bank Ltd (1992) 3 NWLR (Part 228) 251 128 Adekunle v Rockview Hotel Ltd (2004) 1 NWLR (Part 853) 161 1 Adeleke v Asenifa (1990) 3 NWLR (Part 136) 94 1 Adeniji v Fetuga (1990) 5 NWLR (Part 150) 375 343 Adeniran v Ashabi (2004) 2 NWLR (Part 857) 375 143 Adeosun v Jibesin (2001) 11 NWLR (Part 724) 290 143 Aderounmu v Aderounmu (2003) 2 NWLR (Part 823) 1 262 Adesanya v President, Federal Republic of Nigeria (1981) 2 NCLR 358 369 Adewuyi v Abidade 4 WACA 169 369 Adeyemi v Lan and Baker (2000) 7 NWLR (Part 663) 33 177 Adeyemi v Opeyori (1976) 9 – 10 SC 31 218 Adigun v A-G, Oyo State (1987) 1 NWLR (Part 53) 678 143 Adisa v Oyinlola (2000) 10 NWLR (Part 674) 116 1 Administrator General and Public Trustee v Ilobi (1972) 2 ECSLR 587 218 Afolayan v Ogunrinde (1990) 1 NWLR (Part 127) 369 369 xxxiii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Afribank (Nig) Plc v KCG (Nig) Ltd (2001) 8 NWLR (Part 714) 87; (2001) FWLR (Part 67) 1042 CA 218 African Newspaper v Federal Republic of Nigeria (1985) 2 NWLR (Part 6) 137 75;218 A-G, Bendel State v UBA (1986) 4 NWLR (Part 37) 547 310 A-G, Enugu State v Omaba (1998) 1 NWLR (Part 532) 83 279 A-G, Lagos State v Cus Ltd (2002) 14 NWLR (Part 786) 105 262 A-G, Abia State v A-G, Federation (2002) 6 NWLR (Part 763) 264 75 A-G, Anambra State v Nwobodo (1992) 7 NWLR (Part 256) 711 177 A-G, Edo and Delta States v Jessica Trading Co (1999) 5 NWLR (Part 604) 500 143 A-G, Kaduna v Hassan (1985) 2 NWLR (Part 8) 483 369 A-G, Kwara State v Olawale (1993) 1 NWLR (Part 272) 645 369 A–G, Lagos State v Purification Technical (Nig) Ltd (2003) 16 NWLR (Part 845) 1 1 A-G, Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255 75; 369 Agwuegbo v Kagoma (2000) FWLR (Part 19) 511 279 AIC Ltd v NNPC (2005) 11 NWLR (Part 937) 563 369 Ajakaiye v Military Governor Bendel State (1993) 9 SCNJ 242 245 Ajayi v Mil Admin, Ondo State (1997) 5 NWLR (Part 504) 237 369 Ajayi v Texaco (1987) 3 NWLR (Part 62) 577 343 Ajibona v Kolawole (1996) 10 NWLR (Part 476) 22 245 Ajide v Kelani (1985) 3 NWLR (Part 12) 248 75 Ajuwon v Akanni (1993) 9 NWLR (Part 316) 182; (1993) 12 SCNJ 32 343 xxxiv [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page Ajuwon v Akanni (1994) 14 LRCN 72; (1993) 9 NWLR (Part 316) 182 75 Akalonu v Omokoro (2003) 8 NWLR (Part 821) 190 262 Akapo v Hakeem-Habeeb (1992) 6 NWLR (Part 147) 266 177 Akeredolu v Akinremi (No. 3) (1989) 3 NWLR (Part 343; 108) 164 369 Akibu v Azeez (2003) 5 NWLR (Part 814) 643 245; 369 Akibu v Oduntan (1992) 2 NWLR (Part 222) 75 Akin v Manga LGA (1996) 4 NWLR (Part 674) 76 1 Akinfolarin v Akinnola (1994) 3 NWLR (Part 335) 659 245 Akinkugbe v Bucknor (2004) 11 NWLR (Part 885) 652 143 Akinola v Oluwo (1962) 1 SCNLR 352 369 Akinsanya v UBA Ltd (1986) 4 NWLR (Part 35) 310; 273; (1986) 2 NSCC 980 369 Akintola v Balogun (2000) 1 NWLR (Part 642) 532 369 Akuma Industries Ltd v Ayman Enterprises Ltd (1999) 13 NWLR (Part 633) 68 1 Alade v Olukade (1976) 2 SC 183 187 75 Aladegbemi v Fasanmade (1988) 3 NWLR (Part 81) 129 369 Alakija v Abdulai (1998) 6 NWLR (Part 552) 1 40 Alao v ACB (1998) 3 NWLR (Part 542) 339; (1998) 2 SCNJ 17 1; 343 Alao v Akano (2005) 11 NWLR (Part 935) 160 1 Alfotrin Ltd v A-G, Fed (1996) 9 NWLR (Part 475) 634 369 Allen v John Holt Co Ltd (1935) 12 NLR 13 75 Allied Bank Nig Ltd v Akubueze (1997) 6 NWLR (Part 509) 374 128 Allied Bank Plc v Bravo WA Ltd (1996) 3 NWLR (Part 439) 710 75 xxxv [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Alraine Shipping (Nig) Ltd v Endura Auto Chemi- cals (2001) 12 NWLR (Part 728) 759 218 Alsthom SA v Saraki (2005) All FWLR (Part 246) 1385 177 Aminashanu v UCH (1996) 10 NWLR (Part 476) 65 128 Amira (Nig) Ltd v Mal (Nig) Ltd (2001) 17 NWLR (Part 741) 460 262 Anaze v Anyaso (1993) 5 NWLR (Part 291) 1 369 Animashaun v Olojo (1990) 6 NWLR (Part 154) 111 143 Anueyiagu v Deputy Sheriff, Kano (1962) 1 All NLR (Part 2) 52 143 Anueyiagu v Deputy Sheriff, Kano (1962) 1 All NLR 940 143 Anyaoke v Adi (1986) 3 NWLR (Part 31) 731 343 AP Ltd v Owodunni (1991) 8 NWLR (Part 210) 391 1 Apena v Aiyetobi (1989) 1 NWLR (Part 95) 85 143 Archibong v Ibe (2004) 2 NWLR (Part 857) 590 1 Ariori v Elemo (1983) 1 SC 13; (1983) 1 SCNLR 1 201 Ariori v Elemo (1983) 1 SC 26 1 Ariori v Elemo (1983) 1 SCNLR 1 75 Aromolaran v Oladele (1990) 7 NWLR (Part 162) 359 218 Arowolo v Akapo (2003) 8 NWLR (Part 823) 451 218 Arowolo v Ifabiyi (2002) 4 NWLR (Part 757) 356 369 Artra Industries Nig Ltd v NBCI (1998) 4 NWLR (Part 546) 357 201 Asogwu v Chukwu (2003) 4 NWLR (Part 811) 540 262 Atagura v Gura (2005) 2 SC (Part 1) 101 177 Atta v Ezeanah (2000) 11 NWLR (Part 678) 363 369 Atufe v Ogonienor (2004) 13 NWLR (Part 890) 327 1 Aubergine Collections Ltd v Habib Nig Bank Ltd (2002) FWLR (Part 128) 1276; (2002) 4 NWLR (Part 757) 338 177 Auchi Polytechnic v Okuoghae (2005) 10 NWLR (Part 933) 279 1 Ayalogu v Agu (2002) 3 NWLR (Part 753) 168 201 xxxvi [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page Ayeni v Dada (1978) 3 SC 35 75; 369 Ayeni v Sowemimo (1982) 5 SC 60 218 B Babalola v Oshogbo LG (2003) 16 NWLR (Part 289) 465 CA 177 Babatunde Ajayi v Texaco (Nig) Ltd (1978) 9–10 SC 1 201 Badaru v SCB (Nig) Ltd (2003) 10 NWLR (Part 827) 91 297 Bakare v LSCSC (1992) 8 NWLR (Part 262) 641 201 Bank of the North v Yau (2001) 10 NWLR (Part 721) 408 143 Barclays Bank DCO v Hassan (1961) 4 All NLR 836 143 Barclays Bank of Nig Ltd v Ashiru (1978) 6 – 7 SC 99 75 Batalba v West Construction Co Ltd (2001) 18 NWLR (Part 744) 95 1 Bello v A-G, Oyo State (1986) 5 NWLR (Part 45) 828 343 Bendel Feed and Flour Mill Ltd v NPMB Ltd (2000) 5 NWLR (Part 655) 29 279 Bi Zee Bee Hotels Ltd v Allied Bank (Nig) Ltd (1996) 8 NWLR (Part 465) 176 218 Bijon (Nig) Ltd v Osidarokwo (1992) 6 NWLR (Part 249) 643 262 Bodi v Agyo (2003) 16 NWLR (Part 846) 305 262 Bokini v John Holt and Co Ltd (1937) 13 NLR 109 75 Bolaji v Bamgbose (1986) 4 NWLR (Part 37) 632 369 BON v NBCI (1990) 5 NWLR (Part 150) 263 143 Boothia Maritime Inc v Fareast Mercantile Co Ltd (2001) FWLR (Part 50) 1713 279 Brawal Shipping (Nig) Ltd v Extraction Commodity Services Ltd (2001) 14 NWLR (Part 732) 172 218 xxxvii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Brifina Ltd v Inter-Cont Bank Ltd (2003) 5 NWLR (Part 814) 540 128 British and French Bank Ltd v Opaleye (1962) 1 SCNLR 60 128 Brollo Ltd v Nkwocha (1995) 9 NWLR (Part 419) 361 369 Bruce v African and Eastern Trade Corp Ltd (1928) 9 NLR 118 75 Bua v Dauda (1999) 12 NWLR (Part 629) 59 75 Buraimoh v Bamgbose (1989) 3 NWLR (Part 109) 352 279 C CCB (Nig) Ltd v Mbakwe (2002) 7 NWLR (Part 765) 158 369 Ceekay Traders Ltd v General Motors Ltd (1992) 2 NWLR (Part 222) 132 128 Clay Industries Nig v Aina (1997) 52 LRCN 2038; (1997) 8 NWLR (Part 516) 208 75 Combined Trade Ltd v ASTB Ltd (1995) 6 NWLR (Part 404) 709 75 Comet Shipping Agencies Ltd v Babbit Ltd (2001) FWLR (Part 40) 1630; (2001) 7 NWLR (Part 712) 442 279 Consortium MC v NEPA (1992) 6 NWLR (Part 246) 132 177 Cotecna Intl Ltd v Ivory Merchant Bank Ltd (2006) 9 NWLR (Part 985) 275; (2006) 6 MJSC 89 369 Crownstar and Co Ltd v The Vessel MV Valip (2000) 1 NWLR (Part 639) 37 218 D Da Rocha v Hussain (1958) 3 FSC 89; (1958) SCNLR 280 75 Dabup v Kolo (1993) 9 NWLR (Part 317) 254; (1995) 12 SCNJ 25 343 xxxviii [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page Dagazau v Borkir International Ltd (1999) 7 NWLR (Part 610) 293 143 Dahiru v Kamale (2001) 11 NWLR (Part 723) 224; (2001) FWLR (Part 62) 1855 143 Dale Power Systems Plc v Witt and Bush Ltd (2001) 8 NWLR (Part 716) 699 1 Daniel v Samad (1997) 7 NWLR (Part 514) 673 177 Dan-Jumbo v Dan-Jumbo (1999) 11 NWLR (Part 627) 445 40; 128 De Lluch v SBN Ltd (2003) 15 NWLR (Part 842) 1 369 Doma v Ogiri (1997) 1 NWLR (Part 481) 322 75 E Eastern Plastics v Synco (WA) (1999) 1 NWLR (Part 587) 456 177 Ebba v Ogodo (1984) 1 SCNLR 372 143 Ebele v Ikweki (No. 2) (1995) 7 NWLR (Part 405) 91 177 Ebiteh v Obiki (1992) 5 NWLR (Part 243) 599 218 Eboigbe v NNPC (1994) 5 NWLR (Part 347) 649 1 Edebiri v Edebiri (1997) 4 NWLR (Part 498) 165 201 Egbe v Adefarasin (1987) 1 NWLR (Part 47) 1 245 Egbe v Adefarasin (No.1) (1985) 1 NWLR (Part 3) 549 143 Egbunike v ACB (1995) 2 NWLR (Part 375) 34; (1995) 2 SCNJ 58 343 Egonu v Egonu (1978) 11–12 SC 111 201 EIB Building Society Ltd v Adebayo (2004) FWLR (Part 193) 223 262 Ekeogu v Aliri (1991)3 NWLR (Part 179) 258 245 Ekong v Udo (2002) 16 NWLR (Part 792) 1 143 Ekpenvong v Nyong (1975) 2 SC 71 201 Ekwunife v Wayne (WA) Ltd (1989 5 NWLR (Part 122) 422 369 xxxix [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Ekwunife v Wayne West Africa Ltd (1989) 5 NWLR (Part 122) 422 297 Elike v Nwankwola (1984) 12 SC 301 177 Enang and others v Adu (1981) 11–12 SC 25 343 Enigbokan v American Int Insurance Co Ltd (1994) 6 NWLR (Part 348) 1; (1994) 6 SCNJ 168 218 Eperokun v University of Lagos (1986) 4 NWLR (Part 34) 162 40 Eravadodoke v University of Benin Teaching Hospi- tal Management Board (1993) 2 NWLR (Part 277) 590 201 Etim v Ekpe (1983) 3 SC 12; (1983) 1 SCNLR 120 75 Etim v Queen (1964) 1 All NLR 38 75 Ewan v ACB Ltd (1986) 1 QLRN 229 75 Ezuku v Ukachukwu (2004) 46 WRN 1 128 F Fadare v A-G, Oyo State (1962) NSCC 52 245 Famuroti v Agbeke (1991) 13 NWLR (Part 189) 1 177 FATB Ltd v Partnership Investment Co Ltd (2003) 18 NWLR (Part 851) 35 369 FATB v Ezegbu (1993) 6 NWLR (Part 297) 1 201 Fatoyinbo v Williams (1956) 1 FSC 67; (1956) 1 SCNLR 274 310 Fawehimni v Akilu (1987) 4 NWLR (Part 67) 797 369 Fawehinmi v Inspector General of Police (2002) 7 NWLR (Part 767) 606 75 FBN Plc v Excel Plast Ind Ltd (2003) FWLR (Part 160) 1624; (2003) 13 NWLR (Part 837) 412 177 FBN Plc v Obeya (1998) 2 NWLR (Part 537) 205 143 FCDA v Naibi (1990) 3 NWLR (Part 138) 270 369 Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333 115 Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333; (1999) 2 SCNJ 57 218 xl [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page First Bank of Nigeria Ltd v Pan Bisbilder (Nig) Ltd (1990) 2 NWLR (Part 134) 647 1 Flash Fixed Odds Ltd v Akatugba (2001) FWLR (Part 76) 709 279 FMBN v NDIC (1999) 2 NWLR (Part 591) 333 369 Fojule v Federal Mortgage Bank of Nigeria (2001) 2 NWLR (Part 697) 384 75 G Gbafe v Gbafe (1996) 6 NWLR (Part 455) 417 143 General Aviation Services Ltd v Thahal (2004) 10 NWLR (Part 880) 50 1 George v Dominion Flour Mills Ltd (1963) 1 SCNLR 117; (1963) 1 All NLR 71 369 Gever v China (1993) 9 NWLR (Part 315) 97 279 Global Trans SA v Free Enterprise Nig Ltd (2001) FWLR (Part 40) 1706; (2001) 5 NWLR (Part 706) 426 SC 177 Globe Fishing Industries Ltd v Coker (1990) 7 NWLR (Part 162) 265 75 Green Finger Agro Industries Ltd v Yusufu (2003) 12 NWLR (Part 835) 488 262 H Habib Nig Bank Ltd v Gift Unique (Nig) Ltd (2004) 15 NWLR (Part 896) 408 297 Henkel Chem Ltd v AG Ferrero and Co (2003) 4 NWLR (Part 810) 306 177 Himma Merchants Ltd v Aliyu (1994) 5 NWLR (Part 347) 667; (1994) 6 SCNJ (Part 1) 81 343 Honika Sawmil (Nig) Ltd v Hoff (1994) 2 NWLR (Part 326) 252 75 I Idahosa v Oronsaye (1959) SCNLR 407; (1959) 4 FSC 166 369 Igbodin v Obianke (1976) 9 – 10 SC 179 1 xli [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Iheanacho v Ejiogu (1995) 4 NWLR (Part 389) 324 245 Ihekwoaba v ACB Ltd (1998) 10 NWLR (Part 571) 590 75 Ijebu Ode Local Government v Adedeji Balogun and Co Ltd (1991) 1 NWLR (Part 166) 136 369 Ijebu–Ode Local Government v Balogun & Co Ltd (1991) 1 NWLR (Part 166) 136 1 Ikpeazu v ACB Ltd (1965) NMLR 374 369 Imah v Okogbe (1993) 9 NWLR (Part 316) 159 369 IMNL v Pegofor Ind Ltd (2005) 15 NWLR (Part 947) 1 369 Inland Containers Ltd v RCT Co (Nig) Ltd (1997) 8 NWLR (Part 517) 505 75 Integrated Timber and Plywood Products Ltd v UBN Plc (2006) 12 NWLR (Part 995) 483; (2006) 5 SC (Part 11) 52 369 International Nigerbuild Construction Co Ltd v Giwa (2003) 13 NWLR (Part 836) 69 262 Ishola v Societe-General Bank (Nig) Ltd (1997) 2 NWLR (Part 488) 405 343 Isiaka v Zwingina (2003) 6 NWLR (Part 817) 560 262 J Jack v Whyte (2001) 6 NWLR (Part 709) 266 143 Jadesinmi v Egbe (2003) 10 NWLR (Part 827) 1 262 Jallco Ltd v Owoniboys Tech Services Ltd (1995) 4 245; NWLR (Part 391) 534 343; 369 Jatau v Ahmed (2003) 4 NWLR (Part 811) 498; (2003) 1 SCNJ 382; (2003) 4 NWLR (Part 811) 498 218 Jeric (Nig) Ltd v Union Bank of Nigeria Plc (2000) 15 NWLR (Part 691) 447; (2000) 12 SCNJ 184 343 John Holt and Co v Fajemirokun (1961) All NLR 492 177 Juwo v Shehu (1992) 8 NWLR (Part 258) 129 143 xlii [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page K Kabiru Bayero v Federal Mortgage Bank (Nig) Ltd and others (1998) 2 NWLR (Part 538) 509 143 Kalu v Odili (1992) 5 NWLR (Part 240) 130 128 Kano v Oyelakin (1993) 3 NWLR (Part 282) 399 369 Karibo v Grend (1992) 3 NWLR (Part 230) 426 369 Kassim v Hermann Ebert (Trading as Cash Stores) (1966) 1 All NLR 55; (1966) NMLR 123 143 Kate Enterprises Ltd v Daewoo (Nig) Ltd (1985) 2 NWLR (Part 5) 127; (1985) 7 SC 1 279 Katsina Local Authority v Makudawa (1971) NSCC 119; (1971) 1 NMLR 100 201 Kenon v Tekam (2001) FWLR (Part 70) 1660; (2001) 14 NWLR (Part 732) 1 177 Kigo (Nig) Ltd v Holman Bros Nig Ltd (1980) 5 – 7 SC 60 75 Knightsbridge v Atamako (2000) 2 NWLR (Part 645) 387 177 Kotoye v Saraki (1994) 7 NWLR (Part 357) 414 245 Kudu v Aliyu (1992) 3 NWLR (Part 231) 615 201 Kuti v Balogun (1978) 1 SC 53 143 Kyari v Alkali (2001) 11 NWLR (Part 724) 412 143 L Lahan v Lajoyetan (1972) NSCC 460; (1972) 6 SC 190 218 Lawson v Afani Construction Co (Nig) Ltd (2000) FWLR (Part 109) 173; (2002) 2 NWLR (Part 752) 585 75 Lewis and Peat (NIR) Ltd v Akhimien (1976) 1 FNR 80 1; 343 M Macaulay v NAL Merchant Bank (1990) 4 NWLR 1;177; (Part 144) 283 201 Macgregor v NMB (1996) 2 SCNJ 72 177 xliii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Magit v University of Agriculture Markurdi (2005) 19 NWLR (Part 959) 211; (2006) All FWLR (Part 298) 1313 177 Maidara v Halilu (2000) 13 NWLR (Part 684) 257; 2000 FWLR (Part 19) 433 75 Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR (Part 524) 198 75 Maya v Oshuntokun (2001) 11 NWLR (Part 723) 62 262 MMS v Oteju (2005) All FWLR (Part 270) 1995; (2005) 5 SC 55 177 Mobil Oil (Nig) Plc v IAL 36 Inc (2000) 6 NWLR (Part 659) 146 143 Mogaji v Odofin (1978) 4 SC 91 143; 279; 343 Mohammed v Kano Native Authority (1968) 1 All 177; NLR 424 201 Momoh v Olotu (1970) 1 All NLR 117 369 Muhammed v Kayode (1997) 11 NWLR (Part 530) 584 75 Multipurpose Ventures Ltd v Admin, Kwara State, Lafiaji (1998) 7 NWLR (Part 557) 202 369 Multipurpose Ventures Ltd v A-G, Rivers State (1997) 9 NWLR (Part 522) 642 369 Mutual Aid Society Ltd v Ogonade NNLR 18 143 N NAB Ltd v Felly Keme (Nig) Ltd (1995) 4 NWLR (Part 387) 100 143 Nasaralai Ent Ltd v Arab Bank (1986) 4 NWLR 310; (Part 36) 409 369 Nasr v Berini (Beirut Riyad) (Nig) Bank Ltd (1968) 1 All NLR 274 369 NBCI v Integrated Gas (Nig) Ltd (2005) 4 NWLR (Part 916) 617 1 xliv [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page NBCI v Sparkling Dry Cleaning (Nig) Ltd (1998) 13 NWLR (Part 580) 11 1 NBCI v Standard (Nig) Eng Co Ltd (2002) 8 NWLR (Part 768) 104 201 Ndayako v Dantoro (2004) 5 SCNJ 152; (2004) 13 NWLR (Part 889) 187 218 NDIC v Ecobank (Nig) Ltd (2003) 11 NWLR (Part 830) 93 279 NDIC v FMBN (1997) 2 NWLR (Part 490) 735 369 NDIC v Ifediegwu (2003) 1 NWLR (Part 800) 56 177 NDIC v Okem Enterprises Ltd (2004) 10 NWLR 218; (Part 880) 107 369 NDIC v SBN Plc (2003) 1 NWLR (Part 801) 311 128 Ndiwe v Shingleton and Company Ltd (1993) 2 NWLR (Part 274) 242 369 Ndukauba v Kolomo (2005) All FWLR (Part 248) 1602; (2005) 124 LRCN 479 177 Ndulue v Ibezim (2002) 12 NWLR (Part 780) 139 201 Neka BBB Manufacturing Co Ltd v ACB Ltd (2004) 2 NWLR (Part 858) 521 1 New Nigerian Bank Lid v Omovosa (1995) 9 NWLR (Part 419) 327 369 NGS Co Ltd v NPA (1990) 1 NWLR (Part 129) 741 369 Niger Construction Ltd v Okugbeni (1987) 4 NWLR (Part 67) 787; (1987) 2 SC 108 343 Nigerian Bank for Commerce and Industry v Inte- grated Gas (Nig) Ltd (2005) 4 NWLR (Part 916) 617 262 Nigerian Housing Development Society and another v Mumuni (1977) 1 NSCC 65 201 Nigerian Industrial Development Bank Ltd v Olalomi Industries Ltd (2002) 5 NWLR (Part 761) 532 262 Nigerian National Supply Co Ltd v Sabana Ltd (1987) 2 NWLR (Part 56) 285 218 xlv [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Nigerite (Nig) Ltd v Dalami (Nig) Ltd (1992) 7 NWLR (Part 253) 288 143 Nkado v Biano (1997) 5 NWLR (Part 503) 31 128 Nnamdi Azikiwe University v Nwafor (1999) 1 NWLR (Part 585) 116 143 NNB Plc v Denclag Ltd (2005) 4 NWLR (Part 916) 49 1 Nneji v Chukwu (1988) 3 NWLR (Part 78) 184 201 Nnonye v Anjiechie (2005) 2 NWLR (Part 910) 623 201 Nnwaji v Coastal Services (Nig) Ltd (1999) 11 NWLR (Part 628) 641 75 NPA Plc v Lotus (2005) 12 SC (Part 1) 19; (2005) 10 NWLR (Part 959) 158 245 Nsirim v Nsirim (1990) 3 NWLR (Part 138) 285 75 Nta v Anigbo (1972) 5 SC 156 218 NV Scheep v M V “S Araz” (2000) 15 NWLR (Part 691) 662 369 Nwadike v Ibekwe (1987) 4 NWLR (Part 67) 718 1 Nwankwo v Abazie (2003) 12 NWLR (Part 834) 381 143 Nweko v FRN (2003) 4 NWLR (Part 809) 1 128 Nwokoro v Onuma (1999) 12 NWLR (Part 631) 342 75 O Obere v Board of Management, Eku Baptist Hospi- tal (1978) 6 7 SC 15 369 Obiefuna v Okoye (1961) 1 SCNLR 144; (1961) All NLR 357 143 Obijaku v NDIC (2002) 8 NWLR (Part 774) 201 128 Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 143 Obikoya v Wema Bank Ltd (1991) 7 NWLR (Part 201) 119 1 Obodo v Olomu (1986) 3 NWLR (Part 59) 111 177 Obot v CBN (1993) 8 NWLR (Part 310) 140 343 Oceanic Bank International (Nig) Ltd v Child Indus- tries Ltd (2001) 6 NWLR (Part 661) 464 1 Ochin v Ekpechi (2000) 5 NWLR (Part 656) 225 128 xlvi [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page Odejide v RTGLM (2004) 38 WRN 61 128 Odiba v Muemue (1999) 10 NWLR (Part 622) 174 1 Odife v Aniemeka (1992) 7 NWLR (Part 251) 25 128 Odje v Ovien (1992) 7 NWLR (Part 253) 309 143 Odua Investment Company Ltd v Talabi (1997) 10 NWLR (Part 523) 1 75 Odubeko v Fowler (1993) 7 NWLR (Part 308) 637 143;24 5; 369; Odulaja v Haddad (1973) 11 SC 357 279 Oduwole v LSDPC (2004) 9 NWLR (Part 878) 382 143 Offoboche v Ogoja Local Government (2001) 16 NWLR (Part 739) 458 1 Ogannagbe v Giwa (1969) 2 All NLR 35 143 Ogba v Onwuzo (2005) 14 NWLR (Part 945) 334 128 Ogbimi v Ololo (1993) 7 NWLR (Part 304) 128 369 Ogele v Nuhu (1997) 10 NWLR (Part 523) 109 143 Ogolo v Fubara (2003) 11 NWLR (Part 831) 231 143 Ogualaji v A-G, Rivers State (1997) 6 NWLR (Part 508) 209 1 Ogun v Asemah (2002) 4 NWLR (Part 756) 208 201 Ogundiani v Araba (1978) 6 – 7 SC 55 40; 75 Ogunleye v Oni (1990) 2 NWLR (Part 135) 745 343 Ohadugha v Garba (2000) 14 NWLR (Part 687) 226; (2000) FWLR (Part 16) 2721 343 Oje v Babalola (1991) 4 NWLR (Part 185) 267 343 Ojelade and another v Soroye (1998) 5 NWLR (Part 549) 284 75 Ojikutu v Agbonmagbe Bank Ltd (1966) 2 All NLR 277 75 Okafor v A-G, Anambra State (1988) 2 NWLR (Part 79) 736 75 Okafor v Okafor (2000) 11 NWLR (Part 677) 21; (2000) FWLR (Part 1) 17 143 Okonkwo v CCB (Nig) Plc (1997) 6 NWLR (Part 507) 48 75 xlvii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Okonkwo v Co-operative and Commerce Bank Plc (2003) 8 NWLR (Part 822) 47 262 Okoya v Santilli (1994) 4 NWLR (Part 338) 256; (1994) 2 SCNJ 333 343 Okoya v Santilli and others (1990) 2 NWLR (Part 131) 172 201 Okoye v Nigerian Construction and Furniture Com- pany Ltd (1991) 6 NWLR (Part 199) 501; (1991) 2 NSCC (Vol. 2) 422 369 Okpala v DGNC for MM (1996) 4 NWLR (Part 444) 585 1 Okpiri and others v Jonah and others (1961) 1 All NLR 102; (1961) 1 SCNLR 174 310 Okpokpo v Uko (1997) 11 NWLR (Part 527) 94 177 Okpolaeke v NEPA (2003) 14 NWLR (Part 846) 383 262 Okubule v Oyagbola (1990) 4 NWLR (Part 147) 723 369 Okunola v Oduola (1987) 4 NWLR (Part 64) 141 369 Olafisoye v FRN (2004) 4 NWLR (Part 864) 580 143 Olale v Ekwelendu (1989) 4 NWLR (Part 115) 326 40 Olatunde v OAU (1998) 5 NWLR (Part 549) 178 201 Oloba v Akereja (1988) 3 NWLR (Part 84) 508 115 Oloriode v Oyebi (1984) 1 SCNLR 390 369 Olorunfemi v NEB Ltd (2003) 5 NWLR (Part 812) 1 1;262 Olowosago v Adebanjo (1988) 4 NWLR (Part 88) 275 369 Olufunmishe v Falana (1990) 3 NWLR (Part 136) 1 1 Olusanya v Olusanya (1983) 1 SCNLR 134 143 Omega Bank (Nig) Plc v OBC Ltd (2005) 8 NWLR (Part 928) 547 1 Omisade v Akande (1987) 2 NWLR (Part 55) 158 218 Omo v Amantu (1993) 3 NWLR (Part 280) 187 143 Omo v JSC (2000) FWLR (Part 20) 676; (2000) 12 NWLR (Part 682) 444 177 Omonuwa v Wahabi (1976) 4 SC 37 1; 310 xlviii [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page Omosowan v Chiedozie (1998) 9 NWLR (Part 566) 477 218 Onajobi v Olanipekun (1985) 1 SC 156 177 Onifade v Olayiwola (1990) 7 NWLR (Part 161) 177; 130; (1990) 11 SCNJ 10 343 Onitolo v Bello (1958) 3 FSC 53; (1958) SCNLR 49 218 Onjewu v KSMCI (2003) 1) NWLR (Part 827) 40 128 Onuorah v Kaduna Refining and Petrochemical Co Ltd (2005) 6 NWLR (Part 921) 393 115 Onwuchekwa v NDIC (2002) 5 NWLR (Part 760) 371 369 Onwuka Hi-teki v ICON Ltd (1992) 2 NWLR (Part 226) 733 343 Oputeh v Ishida (1993) 3 NWLR (Part 279) 34 297 Orakwute v Umolu (1998) 7 NWLR (Part 557) 266 75 Orthopaedic Hospital Management Board v Garba (2002) 14 NWLR (Part 788) 538 115 Oruobu v Anekwe (1997) 5 NWLR (Part 506) 618 177 Osagie v Oyeyinka (1987) 3 NWLR (Part 59) 144 40; 75 Osasona v Ajayi (2003) 14 NWLR (Part 894) 527 75 Osawaru v Ezeiruka (1978) 6 – 7 SC 135 75 Oseni v Oniyide (1999) 13 NWLR (Part 634) 258 143 Oshodi v Eyiwunmi (2000) 13 NWLR (Part 684) 298 143 Osumah v Edo Broadcasting Service (2004) 17 NWLR (Part 902) 332 1 Oviasu v Oviasu (1973) 11 SC 315 143 Owena Bank v Nigerian Stock Exchange (1997) 8 NWLR (Part 515) 1; (1997) 7 SCNJ 160 343 Owodunni v Regd Trustees CCC (2000) 10 NWLR (Part 675) 315 369 Owoniboys Technical Services Ltd v UBN Ltd (2003) 15 NWLR (Part 844) 545 262 Oyegoke v Iriguna (2002) 5 NWLR (Part 760) 417 369 Oyejola v Agboola (1995) 8 NWLR (Part 411) 88 177 Oyewole v Oyekola (1999) 7 NWLR (Part 612) 560 143 xlix [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page P Pacers Multi Dynamic Ltd v MV “Dancing Sisters” (2000) 3 NWLR (Part 648) 241 218 Pavex Int Co Ltd v IBWA (1994) 5 NWLR (Part 347) 685 40 Peenok Investments Ltd v Hotel Presidential Ltd (1982) 12 SC 1 143 Plateau Publishing Co v Adophy (1986) 4 NWLR (Part 34) 205 369 Poly v Maina (2005) All FWLR (Part 284) 250 279 R Raimi v Akintoye (1986) 3 NWLR (Part 26) 97 369 Ramanchadani v Ekpeyong (1975) 2 SC 29 279 RCC (Nig) Ltd v Edomwonyi (2003) 4 NWLR (Part 811) 513 262 RCC (Nig) Ltd v RPC Ltd (2005) 10 NWLR (Part 934) 615 1 S Salako v Williams (1998) 11 NWLR (Part 574) 505 1 Salami v Oke (1987) 4 NWLR (Part 63) 1 143 Saleh v Bank of the North Ltd (2006) 6 NWLR (Part 976) 316 279 Saleh v Monguno (2003) 1 NWLR (Part 801) 221 143 Salu v Egeibon (1994) 6 NWLR (Part 348) 23 177 Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379 245 Saraki v Kotoye (1990) 4 NWLR (Part 143) 144 75 Saraki v Kotoye (1992) 9 NWLR (Part 264) 156 369 Saraki v Societe–Generale Bank (1995) 1 NWLR (Part 371) 126 1 Savannah Bank (Nig) Ltd v Pan Atlantic Shipping and Transport Agencies Ltd (1987) 1 NWLR (Part 49) 212 218 l [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page Savannah Bank Nig Plc v PMS Ltd (1990) 10 NWLR (Part 621) 160 75 Savannah Bank of (Nig) Ltd v Adegoke Motors (Un- reported) CA/L/ 399/96 369 SCC (Nig) Ltd v Elemadu (2005) 7 NWLR (Part 913) 28 1 Seriki v Are (1999) 3 NWLR (Part 595) 469 143 SGB (Nig) Ltd v Aina (1999) 9 NWLR (Part 619) 414 143 Shaibu v NAICOM (2002) 12 NWLR (Part 780) 116 75 Shell BP Petroleum Development Company (Nig) Ltd v Cole and others (1978) 3 SC 183 310 Shell Petroleum Development Co of Nig Ltd v Otoko (1990) 6 NWLR (Part 159) 693 75 Shell Petroleum Development Co v Isaiah (1997) 6 NWLR (Part 508) 236 75;218 Shittu v Fasawe (2002) All FWLR 1017 1 Shugaba v UBN Plc (1999) 11 NWLR (Part 627) 459 143 Silencer and Exhaust Pipes Co v Farah (1998) 12 NWLR (Part 579) 624 75 Societe Generale Bank (Nig) Ltd v Ama (1991) 9 NWLR (Part 619) 414 75 Sodipo v Lemminkainen and others OY (1986) 1 NWLR (Part 15) 220; (1986) All NLR 78 1;143 Sofolahan v Folakan (1990) 10 NWLR (Part 621) 86 75 Solomon v African Steamship (1928) 9 NLR 99 245 Sonnar (Nig) Ltd v Norwind (1987) 4 NWLR (Part 66) 520 1 South Eastern Newspaper Corporation v Anwara (1975) 9 – 11 SC 143 Sowemimo v Somisi (1982) 1 All NLR (Part 1) 49 218 Spasco Vehicle and Plant Hire Co Ltd v Alraine Nig Ltd (1995) 8 NWLR (Part 416) 655 343 li [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page SPDC Ltd v Adamkwe (2003) 11 NWLR (Part 832) 533 262 State v Gwonto (1983) 1 SCNLR 142 343 State v Ilori (1983) 1 SCNLR 94 369 Stirling Civil Eng Nig Ltd v Yahaya (2002) 2 NWLR (Part 750) 1 128 Summit Financial Co. Ltd v Iron Baba and Sons Ltd (2003) 17 NWLR (Part 848) 89 262 Swiss-Nigeria Wood v Bogo (1972) 1 NLR (Part 7) 433 369 T Tella v Usman (1997) 12 NWLR (Part 531) 168 369 Temco Engineering Co Ltd v Savannah Bank (Nig) Ltd (1995) 5 NWLR (Part 397) 607 75 Texaco Overseas (Nig) Ltd v Pedmar (Nig) Ltd (2002) 13 NWLR (Part 785) 526 297 Thanni v Saibu (1977) 2 SC 89 143 The Chairman, NPC v The Chairman Ikere Local Govt and others (2001) FWLR (Part 70) 1466 279 Thomas v Olufosoye (1966) 1 NWLR (Part 18) 669 (SC) 1;369 Tigris International Corp v Ege Shipping and Trading Industry (1999) 6 NWLR (Part 608) 701 218 Total (Nig) Plc v Akinpelu (2004) 17 NWLR (Part 903) 509 1 Trenco Ltd v African Real Estate Ltd (1978) 4 SC 9 279 Tsokwa Motors (Nig) Ltd v Awoniyi (1999) 1 NWLR (Part 586) 199 143 Tukur v Gov, Gongola State (1989) 4 NWLR (Part 117) 517; (1989) 9 SCNJ 1 218 Tukur v Govt of Gongola State (1989) 4 NWLR (Part 117) 517 115 U UAC v Owoade 13 WACA 207 143 UBA Ltd v Edionseri (1988) 2 NWLR (Part 74) 93 40 lii [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Cases Referred to

Page UBA Plc v BTL Industries Ltd (2004) 18 NWLR (Part 904) 180 1 UBA v Achoru (1990) 6 NWLR (Part 156) 254; (1990) 10 SCNJ 17 218 Uba v Union Bank Plc (1995) 2 NWLR (Part 405) 72 343 UBN Ltd v Fajebe Foods (1994) 5 NWLR (Part 344) 325 143 UBN Ltd v Odusote Bookstores Ltd (1995) 9 NWLR (Part 421) 558 369 UBN Ltd v Penny Mart Ltd (1992) 2 NWLR (Part 240) 228 1 UBN Ltd v Penny Mart Ltd (1992) 5 NWLR (Part 240) 226 369 UBN Ltd v Salami (1998) 3 NWLR (Part 543) 538 279 UBN Ltd v Umeh and Sons Ltd (1996) 3 NWLR (Part 426) 565 201 UBN Plc v Ishola (2002) FWLR (Part 100) 1253 262 UBN Plc v Jeric (Nig) Ltd (1998) 2 NWLR (Part 536) 63 201 UBN Plc v Sparkling Breweries Ltd (2000) 15 NWLR (Part 689) 200 1 UBN v Nwaokolo (1995) 6 NWLR (Part 400) 127 201 UBN v Ogboh (1995) 2 NWLR (Part 380) 647 343 UBN v Ozigi (1994) 3 NWLR (Part 333) 385 201 UBN v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150 201 Udechukwu v Okwuka (1956) SCNLR 189 297 Umar v Onwudine (2002) 10 NWLR (Part 774) 129 143 Umeojiako v Ezenamuo (1990) 1 NWLR (Part 126) 253 369 Unakalamba v Eze (2002) FWLR (Part 104) 527 75 Union Bank Ltd v Ozigi (1991) 2 NWLR (Part 176) 677 75 Universal Vulcanizing (Nig) Ltd v Ijesha United Trading Co Ltd (1992) 9 NWLR (Part 266) 388 1 liii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Page Uredi v Dada (1988) 1 NWLR (Part 69) 237 343 Uzo v Indiamaowei (1999) 13 NWLR (Part 633) 152 1 V Vaswani Trading Co v Savalakh (1972) 12 SC 77 40 Viatonu v Odutayo (1950) 19 NLR 11 75 Victoria Anisiuba v Anthony Emodi (1975) ECSLR 355 143 Victory Merchant Bank v Pelfaco Ltd (1993) 9 NWLR (Part 317) 340 75 W Wambai v Kano NA (1965) NMLR 15 75 Western Steel Works Ltd v Iron and Steel Workers Union (1986) 3 NWLR (Part 30) 617 201 Windibiziri v Ajila (2002) FWLR (Part 132) 96 75 Winlyn v NACB (2000) 8 NWLR (Part 594) 597 177 Woluchem v Gudi (1981) 5 SC 291 143 Woluchem v Gudi (2004) 3 WRN 20 128 Woluchem v Wokoma (1974) All NLR 543; (1974) 3 SC 153; (1974) 3 SC 153 143 Y Yalaju Amaye v AREC Ltd (1990) 4 NWLR (Part 145) 42 245 Yesufu v ACB (1991) 1 SC 74 297 Yusuf v NTC Ltd (1977) 6 SC 39 279 Z Zakkem Construction Company Ltd v Nneji (2002) 5 NWLR (Part 759) 55 1

liv

INDEX OF FOREIGN CASES REFERRED TO

Page

A Astor Properties v Tunbridge Wells Equitable Friendly Society [1936] 1 All ER 531 1 Atlas Life Ins Co. v Shrimsher 179 OKL 643, 66 p.2d 944 201 B Bellamy v Sabine (1857) 26 LJ (NS) Equity Reports 797 75 Board of Trade v Cayner Irvine and Co Ltd (1927) AC 610 245 F First Bank of Eureka Spring v Cook go S.W. 2d 510 40 H Hood v Anchor Line (Henderson Bros) Ltd (1918) AC 837 310 I Intraco Ltd v Notis Shipping Corporation of Liberia, The Bhoja Trader (1981) 2 Lloyds Rep. 256 310 M Manchester and Oldham Barth v Cook (1883) 49 LT 674 1 Massachusetts Bonding and Insurance Co v Knoex 18 SE 2d 436 40 Mcfoy v UAC Ltd [1961] 3 All ER 1169; (1962) AC 152 201 Mitchell v Federal Bank of St Louis 174 SW 2d 671 40 lv [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

P People ex rel O’Connor v City of Chicago 20 NE 2D 306 40 R Richardson, Spence and Co and another v Minnie Rowntree (1894) AC 217 310 S Services Europe Atlantique and (SEAS) v Stock- holms Rederiaktiebolag SVEA The Folias [1978] 2 All ER 764 310 Sorrel v Carpenter (1s728) 2 P Wms 482 75 T Tommey v White 3 HLC 49 75 U United States v Shipp (208) US 563, 51 L.ed. 319, 27 SC 165, 8 Ann Cas 265 (1906) 115 United States v United Mine Workers of America USSCR 91 L. ed. 884 115 W Wallersteiner v. Moir (1974) 1 WLR 991 1 WJ Allan and Co Ltd v El Nasr Export (1972) 2 QB 198 369

lvi

INDEX OF NIGERIAN STATUTES REFERRED TO

Admiralty Jurisdiction Act 59 of 1991 s 1(1)(h)...... [2004 – 2006] 13 N.B.L.R. (PART III) 218; 369 s 19 ...... [2004 – 2006] 13 N.B.L.R. (PART III) 218 Auctioneer’s Law, Laws of Bendel State, 1976 s 19(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 Banking Act s 15...... [2004 – 2006] 13 N.B.L.R. (PART III) 297 Banks and Other Financial Institution Decree No. 25 of 1991 s 58(2) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 115 s 66...... [2004 – 2006] 13 N.B.L.R. (PART III) 115 Constitution of the Federal Republic of Nigeria, 1979 s 33(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 s 230(d) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 218 s 230(1)(d)... [2004 – 2006] 13 N.B.L.R. (PART III) 369 s 236(d) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 218 s 251(4) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 Constitution of the Federal Republic of Nigeria, 1999 s 6(6)(a)...... [2004 – 2006] 13 N.B.L.R. (PART III) 40 s 6(6)(b)...... [2004 – 2006] 13 N.B.L.R. (PART III) 40 s 36(3) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 s 36(4) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 s 251(1)(d)... [2004 – 2006] 13 N.B.L.R. (PART III) 115; 369 Constitution (Suspension and Modification) Decree No. 107 of 1993 s 1(3) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 218 lvii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

Court of Appeal Act s 16 ...... [2004 – 2006] 13 N.B.L.R. (PART III) 343 Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 s 19...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 s 75...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 s 92(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 s 92(2) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 s 131(1) . [2004 – 2006] 13 N.B.L.R. (PART III) 201; 262 s 132...... [2004 – 2006] 13 N.B.L.R. (PART III) 177; 262 s 134...... [2004 – 2006] 13 N.B.L.R. (PART III) 262 s 136 ...... [2004 – 2006] 13 N.B.L.R. (PART III) 262 s 137(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 369 s 137(2) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 369 s 155(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 279 Federal High Court Act Cap 134 Laws of the Federation of Nigeria, 1990 s 22(2) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 115 s 24...... [2004 – 2006] 13 N.B.L.R. (PART III) 218 Federal High Court (Amendment) Decree No. 60 of 1991 424 generally...... [2004 – 2006] 13 N.B.L.R. (PART III) 369 Federal Mortgage Bank Decree No. 7 of 1977 s 14(1)(c)..... [2004 – 2006] 13 N.B.L.R. (PART III) 201 High Court Law (Cap 46) Laws of Oyo State of Nigeria s 16...... [2004 – 2006] 13 N.B.L.R. (PART III) 201 High Court of Lagos State (Civil Procedure) Law Cap 61 Laws of Lagos State, 1994 generally...... [2004 – 2006] 13 N.B.L.R. (PART III) 297 Law (Miscellaneous Provisions) Law of Lagos State s 2...... [2004 – 2006] 13 N.B.L.R. (PART III) 297 lviii [2004 – 2006] 13 N.B.L.R. (PART III)

Index of Nigerian Statutes referred to

Limitation Law Cap. 118 Laws of Lagos State, 1994 s 8...... [2004 – 2006] 13 N.B.L.R. (PART III) 369 s 8(1)(a)...... [2004 – 2006] 13 N.B.L.R. (PART III) 245 s 58...... [2004 – 2006] 13 N.B.L.R. (PART III) 369 National Economic Reconstruction Fund Decree No. 2 of 1989 (as amended) s 1(2)(a) – (d) .... [2004 – 2006] 13 N.B.L.R. (PART III) 1 s 5(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 1 s 5(2) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 1 s 5(1)(a)...... [2004 – 2006] 13 N.B.L.R. (PART III) 1 s 5(4) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 1 Property and Conveyancing Law Cap 129 Laws of Bendel State, 1976 s 125(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 s 192(1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 Public Officers (Protection) Act, 1990 s 2(a) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 1 Sheriff and Civil Process Law Cap 123 of the Revised Laws of Niger State, 1989 s 46...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 s 47...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 Sheriff and Civil Process Act Cap 407 Laws of Federa- tion of Nigeria, 1990 Order 1 rule 5 [2004 – 2006] 13 N.B.L.R. (PART III) 143

lix

INDEX OF FOREIGN STATUTE REFERRED TO

Administration of Justice Act, 1956 generally...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 Judgments Act, 1838 (UK) generally...... [2004 – 2006] 13 N.B.L.R. (PART III) 297

Uniform Customs and Practices for Documentary Credit article 18...... [2004 – 2006] 13 N.B.L.R. (PART III) 310 article 19...... [2004 – 2006] 13 N.B.L.R. (PART III) 310

lxi

INDEX OF NIGERIAN RULES OF COURT REFERRED TO

Court of Appeal Rules, 2002 Order 3 rule 2(4) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 Order 3 rule 14...... [2004 – 2006] 13 N.B.L.R. (PART III) 343 Order 3 rule 15...... [2004 – 2006] 13 N.B.L.R. (PART III) 75

Federal High Court Rules Order 26 rule 6(1) .... [2004 – 2006] 13 N.B.L.R. (PART III) 1 Order 26 rule 14...... [2004 – 2006] 13 N.B.L.R. (PART III) 1

Niger State High Court (Civil Procedure) Rules, 1987 Order 36...... [2004 – 2006] 13 N.B.L.R. (PART III) 143 Order 40 rule 1...... [2004 – 2006] 13 N.B.L.R. (PART III) 143

High Court of Lagos State (Civil Procedure) Rules, 1972 Order 10 rule 1(a)..... [2004 – 2006] 13 N.B.L.R. (PART III) 177 Order 10 rule 1 (b) ... [2004 – 2006] 13 N.B.L.R. (PART III) 177 Order 11 rule (1) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 177 Order 11 rule (2) ...... [2004 – 2006] 13 N.B.L.R. (PART III) 177

High Court of Lagos State (Civil Procedure) Rules, 1994 Order 36 rule 7...... [2004 – 2006] 13 N.B.L.R. (PART III) 297 lxiii [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian Banking Law Reports

High Court of Lagos State (Civil Procedure) Rules, 1994 – continued Order 38 rule 7...... [2004 – 2006] 13 N.B.L.R. (PART III) 297

High Court of Ogun State (Civil Procedure) Rules Order 40 rule 7...... [2004 – 2006] 13 N.B.L.R. (PART III) 343

lxiv

INDEX OF BOOKS REFERRED TO

Black’s Law Dictionary (5ed) page 1417...... [2004 – 2006] 13 N.B.L.R. (PART III) 201 Black’s Law Dictionary (6ed) page 386...... [2004 – 2006] 13 N.B.L.R. (PART III) 218 Black’s Law Dictionary (7ed) page 294...... [2004 – 2006] 13 N.B.L.R. (PART III) 75 Bullen and Leake and Jacobs Precedents of Pleadings (12ed) page 106...... [2004 – 2006] 13 N.B.L.R. (PART III) 343 Chitty on Contract (23ed) paragraph 732, page 329 [2004 – 2006] 13 N.B.L.R. (PART III) 310 Corpus Juris Secundum Volume 54 page 570...... [2004 – 2006] 13 N.B.L.R. (PART III) 40 Halsbury’s Laws of England (3ed) Volume 14 paragraph 1175...... [2004 – 2006] 13 N.B.L.R. (PART III) 201 Raymond Jack Documentary Credits 1993 (2ed) page 9 para. 1.22 ...... [2004 – 2006] 13 N.B.L.R. (PART III) 310 Schmiutthoff Export Trade: The Law and Practice of International Trade (8ed) Chapter 24 page 336 [2004 – 2006] 13 N.B.L.R. (PART III) 310

lxv

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 1 a Brokenn Agro Allied Ind. Ltd v. Oceanic Bank Int. (Nig.) Ltd and another b FEDERAL HIGH COURT OF NIGERIA, LAGOS DIVISION, ABUTU J Date of Judgment: 5 APRIL, 2006 Suit No.: FHC/L/CS/98/2002 c Banking – Contracts – Loan of money – Agreement on fixed date for disbursement – Default by lender – Escalation in costs – Measure of damages recoverable Banking – Contracts – Loan of money – Lenders failure to d produce fund – Measure of damages Banking – Contracts under NERFUND – Statutory flavour – Section 5(1) National Economic Reconstruction Fund e Decree No. 2 of 1989 (as amended) Banking – Loan under NERFUND Act – Breach of agreement by participating bank – Effect of f Banking – Proof of debt – How done Damages – Award of damages for breach of contract – Object of Damages – Measure of damages – Loan of money – Lenders g failure to produce the fund – Damages recoverable Evidence – Proof of debt – How done NERFUND – “Shall” in section 5(1)(a) National Economic h Reconstruction Fund Decree No. 2 of 1989 (as amended) – Meaning of NERFUND – Contract thereunder – Statutory flavour – i Section 5(1)(a) National Economic Reconstruction Fund Decree No. 2 of 1989 (as amended) Practice and procedure – Pleadings – Insufficient traverse – What amounts to – Defendant “cannot admit or deny j plaintiff’s allegation” – Meaning of

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

2 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Facts a The plaintiff’s claim was for the sum of $2,848.78 with interest thereon at the rate of 4% from February, 1995 till the determination of the suit against the first defendant being b the balance of the loan of $998,590 it withheld. The plaintiff also claimed special and general damages. The plaintiff’s case was that sometime in 1994, the plaintiff wrote an application to the second defendant c through the first defendant. The application was approved. PW1 produced the letter of approval and it was tendered and admitted as Exhibit “2”. In his further testimony, PW1 said on 7/2/95, the second defendant disbursed a total of d $998,590 US Dollars to the first defendant to be forwarded to the plaintiff to enable the plaintiff to acquire plant and machinery. The first defendant refused to use the money to open a letter of credit for the purchase of the plant and e machinery for a period of six months. Every attempt made to get the first defendant to release the sum of $998,590 proved abortive. At the time the money was disbursed to the first defendant, the exchange rate was N22 to US$1. The first f defendant opened the letter of credit on 18/7/95 with the sum of US$995,741.22 leaving a balance of US$2,848.78. The first defendant had not given the plaintiff the balance of US$2,848.78. During the period of six months the sum of US$998,590 was in the custody of the first defendant, g interest at 10% per annum was being charged by the first and second defendants to be paid by the plaintiff. The plant and machinery was ordered by the first defendant. Before the plant and machinery arrived, the Federal Government h changed the exchange rate from N22 to US$1 to N80 to US$1. The first defendant wrote a letter to the plaintiff to inform the plaintiff of the change in the exchange rate. PW1 produced the letter and it was tendered and admitted as i Exhibit “3”. In his further testimony, PW1 said at the time the goods arrived the customs tariff had doubled and the goods were abandoned at the wharf for 15 months. He wrote three letters j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 3 a to the defendant in connection with the clearing of the goods. PW1 produced the letters and they were tendered and admitted as Exhibits “4”, “4A” and “4B”. PW1 said he b eventually cleared the goods. He spent the sum of N5,120,000 which he borrowed from abroad on the clearing of the goods. He wrote letters to the first defendant for reimbursement. The first defendant wrote a letter to the second defendant to explain to the second defendant in c connection with the clearing of the goods. The second defendant disbursed the sum of N4,752,000 to the first plaintiff. The first defendant however disbursed the sum of d N3,925,407 to the plaintiff withholding the balance of N826,843 which had not been given to the plaintiff. The first defendant was to provide the working capital. The first defendant failed to provide the working capital. He e wrote three letters to the first defendant. PW1 produced copies of the letters and they were tendered and admitted as Exhibits “5”, “5A” and “5B”. PW1 also produced the first defendant’s reply to the letters which was tendered and f admitted as Exhibit “7”. PW1 said when the first defendant failed to honour its obligation to provide working capital to the plaintiff, the plaintiff applied to another bank for a working capital. He applied to Diamond Bank Nigeria Ltd. g Section 5(1) and (2) of the National Economic Reconstruction Fund Decree No. 2 of 1989 (as amended) read as follows:– “5 (1) The participating banks shall h (a) provide the working capital required by eligible enterprises and projects under this Act.” “5 (2) Each participating bank shall disburse funds approved to enterprises or projects not later than three working days of release of the funds to the participating bank.” i Held – 1. The pleading of a defendant that the defendant is not in a position to admit or deny certain paragraphs of the j statement of claim is a general denial to a positive and

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

4 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

distinctive allegation in the statement of claim and a therefore does not constitute a valid denial of the allegations in the statement of claim. It is an imperfect denial. b In the instant case, the allegations in paragraphs 1, 2, 3, 4, 5, 6, 7, 8 and 9 are therefore deemed to have been established. 2. The word “shall” in section 5(1)(a) NERFUND Act is c obligatory and imperative and parties cannot contract out of it. In the instant case, failure to provide working capital in compliance with the provision of the said

section is a breach on the part of the first defendant. d 3. If the parties had agreed on a fixed date for the disbursement of the loan and due to the defendant’s default, the cost of the importation had escalated far beyond the cost price at the fixed date for the e disbursement, the plaintiff would be entitled to recover as damages, the excess amount it costs them to import the machinery and even if they were unable to import the goods, they would have been entitled to damages for f breach of contract. Per curiam “The evidence of PW1 in this case which has not been challenged or materially contradicted is that the fund which was released to the first defendant on the 7th of February, g 1995 was not disbursed to the plaintiff until sometime in July 1995. The first defendant acted contrary to the mandatory provision of section 5(2) of the NERFUND Act, when it failed to disburse the fund to the plaintiff within three h working days of the release of the funds by NERFUND. The evidence of PW1 which I accept is that the consequences of the failure of the first defendant to open a letter of credit for the plaintiff to facilitate prompt importation of the machinery, the failure of the first defendant to disburse the i funds in accordance with the requirements of section 5(2) of the NERFUND Act; and the failure of the first defendant to provide working capital for the project are:– 1. Importation of machinery was delayed and clearance of the goods when they arrived was stalled. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 5 a 2. The goods arrived late and at the time the goods arrived, the exchange rate had increased from N22 per US$1 to N80 per US$1 and custom duties payable on the goods had been reviewed upwards to the detriment of the b plaintiff. 3. The machinery cannot be installed and the project cannot take off with the result that the plaintiff suffered financial losses; c 4. To enable the plaintiff clear the goods, the plaintiff was forced to obtain a loan from Diamond Bank Plc. The sole witness for the first defendant who testified as DW1 did not materially contradict the evidence of PW1 in relation d to the consequences of the failure of the first defendant to comply with the requirements of the NERFUND Act stated by the PW1 in his evidence. On the basis of the pleadings and the evidence of PW1, I find that the NERFUND loan transaction between the plaintiff and the defendants was e frustrated by the failure of the first defendant to comply with the mandatory requirements of section 5(1)(a) and (2) of the NERFUND Act. The failure to comply with the provisions constitutes a breach of the agreement between the plaintiff f and the first defendant evidenced by Exhibit ‘2’.” 4. In contracts for the loan of money, the normal measure of damages for the lender’s failure to provide the fund is the amount required by the borrower to go into the g market and effect a substitute loan for himself less the amount the contractual loan had required. There may also be consequential losses. Thus, the damages may include the cost of raising the money elsewhere. Further, h the plaintiff may recover for the loss of any contract which hinged upon the loan if the defendant was aware of the purpose for which the plaintiff was entering into the loan. i 5. The object of awarding damages for breach of contract is to put the injured party, so far as money can do, in the same position as if the contract had been performed. In the instant case, the plaintiff is entitled to special j damage.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

6 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Per curiam a “The plaintiff has claimed the sum of N94 million as special damages. The evidence of PW1 which has not been challenged or contradicted is that if the factory has been b commissioned, the plaintiffs monthly profit from the business would not be less than N1 million. I accept the evidence of PW1. Exhibit 2, the loan agreement between the plaintiff and the defendant was executed on 7 July, 1994. The moratorium period during which the project was c expected to have been completed was a period of one year from the date of disbursement which was July 1995 when the sum of $995,741.22 was disbursed to the plaintiff. It was expected that at the end of the twelve months, the project d would be completed for business to commence. I think the plaintiff is entitled to loss of profit from the end of the moratorium period which was July, 1996. From July, 1996 to April, 2006 is a period of nine years and nine months. The plaintiff is entitled to loss of profit for this period of nine e years and nine months at the rate of N1 million per month. The total sum is N117 million. But the plaintiff has claimed N84 million as loss of earning. The plaintiff cannot have more than what it has claimed.” f 6. The usual way of proving a debt and entitlement to interests thereon is by putting in the statement of account or secondary evidence thereof where admissible. In the present case, the statement of account of the g plaintiff has not been put in evidence. The loan and the interest thereon have not been proved. 7. The agreement between the plaintiff and the first defendant evidenced by Exhibit “2” has a statutory h flavour and that the parties have no capacity to dispense with any provision of section 5(1) of the NERFUND Act having regard to the use of the word “shall” in the provision. The use of the word “shall” in the provision i certainly is mandatory and not directory or permissive. 8. The first defendant has a statutory obligation to provide working capital for the project in this case. What the law maker intended to prevent that is, the frustration of the j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 7 a project has in this case, taken place as a result of the failure of the first defendant to provide working capital for the project. b Finding for the plaintiff.

Cases referred to in the judgment Nigerian c Adekunle v Rockview Hotel Ltd (2004) 1 NWLR (Part 853) 161 Adeleke v Asenifa (1990) 3 NWLR (Part 136) 94 d Adisa v Oyinlola (2000) 10 NWLR (Part 674) 116 A-G, Lagos State v Purification Technical (Nig) Ltd (2003) 16 NWLR (Part 845) 1 e Akin v Manga LGA (1996) 4 NWLR (Part 674) 76 Akuma Industries Ltd v Ayman Enterprises Ltd (1999) 13 NWLR (Part 633) 68 Alao v ACB Ltd (1998) 3 NWLR (Part 542) 339 f Alao v Akano (2005) 11 NWLR (Part 935) 160 AP Ltd v Owodunni (1991) 8 NWLR (Part 210) 391 Archibong v Ibe (2004) 2 NWLR (Part 857) 590 g Ariori v Elemo (1983) 1 SC 26 Atufe v Ogonienor (2004) 13 NWLR (Part 890) 327 Auchi Polytechnic v Okuoghae (2005) 10 NWLR (Part 933) h 279 Batalba v West Construction Co Ltd (2001) 18 NWLR (Part 744) 95 i Dale Power Systems Plc v Witt and Bush Ltd (2001) 8 NWLR (Part 716) 699 Eboigbe v NNPC (1994) 5 NWLR (Part 347) 649 First Bank of Nigeria Ltd v Pan Bisbilder (Nig) Ltd (1990) 2 j NWLR (Part 134) 647

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

8 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

General Aviation Services Ltd v Thahal (2004) 10 NWLR a (Part 880) 50 Igbodin v Obianke (1976) 9 – 10 SC 179 Ijebu-Ode Local Government v Balogun & Co Ltd (1991) 1 b NWLR (Part 166) 136 Lewis and Peat (NIR) Ltd v Akhimien (1976) 1 FNR 80 Macaulay v NAL Merchant Bank Ltd (1990) 4 NWLR (Part c 144) 203 NBCI v Integrated Gas (Nig) Ltd (2005) 4 NWLR (Part 916) 617 NBCI v Sparkling Dry Cleaning (Nig) Ltd (1998) 13 NWLR d (Part 580) 11 Neka BBB Manufacturing Co Ltd v ACB Ltd (2004) 2 NWLR (Part 858) 521 e NNB Plc v Denclag Ltd (2005) 4 NWLR (Part 916) 49 Nwadike v Ibekwe (1987) 4 NWLR (Part 67) 718 Obikoya v Wema Bank Ltd (1991) 7 NWLR (Part 201) 119 Oceanic Bank International (Nig) Ltd v Child Industries Ltd f (2001) 6 NWLR (Part 661) 464 Odiba v Muemue (1999) 10 NWLR (Part 622) 174 Offoboche v Ogoja Local Government (2001) 16 NWLR g (Part 739) 458 Ogualaji v A-G, Rivers State (1997) 6 NWLR (Part 508) 209 Okpala v DGNC for MM (1996) 4 NWLR (Part 444) 585 Olorunfemi v NEB Ltd (2003) 5 NWLR (Part 812) 1 h Olufunmishe v Falana (1990) 3 NWLR (Part 136) 1 Omega Bank (Nig) Plc v OBC Ltd (2005) 8 NWLR (Part 928) 547 i Omonuwa v Wahabi (1976) 4 SC 37 Osumah v Edo Broadcasting Service (2004) 17 NWLR (Part 902) 332 RCC (Nig) Ltd v RPC Ltd (2005) 10 NWLR (Part 934) 615 j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 9 a Salako v Williams (1998) 11 NWLR (Part 574) 505 Saraki v Societe-Generale Bank (1995) 1 NWLR (Part 371) 126 b SCC (Nig) Ltd v Elemadu (2005) 7 NWLR (Part 913) 28 Shittu v Fasawe (2002) All FWLR 1017 Sodipo v Lemminkainen OY (No. 2) (1986) 1 NWLR (Part c 15) 220 Sonnar (Nig) Ltd v Norwind (1987) 4 NWLR (Part 66) 520 Thomas v Olufosoye (1986) 1 NWLR (Part 18) 669 d Total (Nig) Plc v Akinpelu (2004) 17 NWLR (Part 903) 509 UBA Plc v BTL Industries Ltd (2004) 18 NWLR (Part 904) 180 UBN Ltd v Penny Mart Ltd (1992) 2 NWLR (Part 240) 228 e UBN Plc v Sparkling Breweries Ltd (2000) 15 NWLR (Part 689) 200 Universal Vulcanizing (Nig) Ltd v Ijesha United Trading Co f Ltd (1992) 9 NWLR (Part 266) 388 Uzo v Indiamaowei (1999) 13 NWLR (Part 633) 152 Zakkem Construction Company Ltd v Nneji (2002) 5 NWLR (Part 759) 55 g Foreign Astor Properties v Tunbridge Wells Equitable Friendly Society [1936] 1 All ER 531 h Manchester and Oldham Barth v Cook (1883) 49 LT 674 Wallersteiner v Moir (1974) 1 WLR 991 i Nigerian statute referred to in the judgment National Economic Reconstruction Fund Decree No. 2 of 1989 (as amended), sections 1(2)(a) – (d), 5(1), 5(1)(a), 5(2), 5(4) j Public Officers (Protection) Act, 1990, section 2(a)

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA)

10 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian rules of court referred to in the judgment a Federal High Court Rules, Order 26 rule 6(1), Order 26 rule 14 b Book referred to in the judgment Mayne and Macgregor on Damages (12ed), page 553

Judgment c ABUTU J: The plaintiff claims as per the statement of claim dated 30 January, 2002 the following reliefs:– 1. The sum of $2,848.78 with interest thereon at the rate d of 4% from February, 1995 till the determination of the suit against the first defendant being the balance of the loan of $998,590 it withheld. 2. An order of court expunging from the plaintiff’s e account, all interests charged by the first defendant from February, 1995 till the determination of the suit. 3. An order mandating the first defendant to refund all unauthorised charges deducted from the plaintiff’s f account. 4. N100 million general damages against the defendants for breach of contract. 5. N94 million special damages. g The statement of claim is made up of 32 paragraphs. The first defendant’s amended statement of defence and counter- claim dated 15 April, 2005 is made up of 47 paragraphs h while the second defendant’s statement of defence dated 14 May, 2002 is made up of 9 paragraphs. The plaintiff’s defence to the counter-claim dated 17 June, 2005 is made up of 15 paragraphs. The statement of claim, the first defendant’s amended statement of defence and counter- i claim, the second defendant’s statement of defence and the plaintiff’s defence to the counter-claim constitute the pleadings in this case on the basis of which evidence was led on both sides. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 11 a To prove the allegations of fact contained in the statement of claim, the plaintiff called one witness who testified as PW1. b PW1 Chief Kenneth Obiekeaya in his sworn testimony said he is the chairman of the Board of Directors of the plaintiff. PW1 produced the certificate of incorporation of the plaintiff company and it was tendered and admitted as c Exhibit “I”. PW1 said in 1994, the plaintiff wrote an application to the second defendant through the first defendant. The application was approved. PW1 produced the letter of approval and it was tendered and admitted as d Exhibit “2”. In his further testimony, PW1 said on 7/2/95 the second defendant disbursed a total of $998,590 US Dollars to the first defendant to be forwarded to the plaintiff to enable the plaintiff acquire plant and machinery. The first e defendant refused to use the money to open a letter of credit for the purchase of the plant and machinery for a period of six months. Every attempt made to get the first defendant to release the sum of $998,590 proved abortive. At the time the money was disbursed to the first defendant, the exchange f rate was N22 to US$1. The first defendant opened the letter of credit on 18/7/95 with the sum of US$995,741.22 leaving a balance of US$2,848.78. The first defendant has not given the plaintiff the balance of US$2,848.78. During the period g of six months, the sum of US$998,590 was in the custody of the first defendant. Interest at 10% per annum was being charged by the first and second defendants to be paid by the plaintiff. The plant and machinery was ordered by the first h defendant. Before the plant and machinery arrived, the Federal Government changed the exchange rate from N22 to US$1 to N80 to US$1. The first defendant wrote a letter to the plaintiff to inform the plaintiff of the change in the i exchange rate. PW1 produced the letter and it was tendered and admitted as Exhibit “3”. In his further testimony, PW1 said at the time the goods arrived the customs tariff had doubled and the goods were j abandoned at the wharf for 15 months. He wrote three letters

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 12 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) to the defendant in connection with the clearing of the a goods. PW1 produced the letters and they were tendered and admitted as Exhibits “4”, “4A” and “4B”. PW1 said he eventually cleared the goods. He spent the sum of b N5,120,000 which he borrowed from abroad on the clearing of the goods. He wrote letters to the first defendant for reimbursement. The first defendant wrote a letter to the second defendant to explain to the second defendant in c connection with the clearing of the goods. The second defendant disbursed the sum of N4,752,000 to the first defendant. The first defendant disbursed the sum of N3,925,407 to d the plaintiff withholding the balance of N826,843 which has not been given to the plaintiff. The first defendant was to provide the working capital. The first defendant failed to provide the working capital. e He wrote three letters to the first defendant. PW1 produced copies of the letters and they were tendered and admitted as Exhibits “5”, “5A” and “5B”. PW1 also produced the first defendant’s reply to the letters which was tendered f and admitted as Exhibit “7”. PW1 said when the first defendant failed to honour its obligation to provide working capital to the plaintiff, the plaintiff applied to another bank for a working capital. He applied to Diamond Bank g Nigeria Ltd. PW1 produced three documents in connection with the working capital provided by Diamond Bank Nigeria Ltd and the documents were tendered and admitted as Exhibits “8”, “9” and “10”. PW1 also produced the h first defendant’s reply to Exhibit “10” and the document was tendered and admitted as Exhibit “11”. PW1 produced a copy of the letter which he wrote to the second defendant and the reply to the letter and the documents were tendered and admitted as Exhibits “12” and “13” respectively. i PW1 said the first defendant wrote a letter to the second defendant for an additional facility. PW1 produced a copy of the letter and it was tendered and admitted as Exhibit “14”. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 13 a In his further evidence, PW1 said there was a tripartite agreement between the plaintiff and the defendants. The plaintiff wrote to the first defendant to demand a copy of the b agreement. PW1 produced the first defendant’s reply to the letter and it was tendered and admitted as Exhibit “15”. PW1 produced the reply to Exhibit “15” and it was tendered and admitted as Exhibit “16”. PW1 said because of lack of c working capital, the major part of the project has not been installed. If the factory has (sic) been commissioned, the maximum profit from the business would not be less than N1 million per month. The first defendant without his consent bought the project from the second defendant. PW1 d prayed the court to grant all the reliefs of the action. Under cross-examination, PW1 said the name of the plaintiff was changed from Brokenn Nig. Ltd to Brokenn Agro-Allied Industries Ltd in 1994 as shown in Exhibit “1”. e By a letter dated 12/7/94, the plaintiff was offered NERFUND term loan. The plaintiff accepted the offer. There was a tripartite agreement between the plaintiff and the defendants. He did not know that the second defendant f demanded for more security. The working capital was to be the first defendant’s equity participation. He did not guarantee the loan given to the plaintiff by the first defendant. The second defendant disbursed the money after g the signing of the tripartite agreement. The second defendant did not take over the project from the first defendant. At the end of the evidence of PW1, the plaintiff closed its case. In rebuttal, each of the defendants called one witness. h The witness for the first defendant testified as DW1 while the witness for the second defendant testified as DW2. DW1, Mrs Chidinma L Okpala in her sworn testimony said she is a staff of Oceanic Bank International Plc. She is a i Branch Manager of the bank. The plaintiff obtained a facility from the bank. The facility was a dollar-denominated facility and a Naira-denominated facility. Exhibit “E1” is the document evidencing the transaction. The conditions in j Exhibit “2” were accepted by the plaintiff. It is not true that

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 14 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Oceanic Bank was to be obligor bank in the transaction. The a bank did not refuse to open a letter of credit for the plaintiff in the transaction. The amount in dollars was $998,590 US dollars. b The second defendant was to send the money through the first defendant to the plaintiff. It was in July, 1994 that the second defendant approved the facility. DW2 produced a copy of the confirmation of approval letter and it was c tendered and admitted as Exhibit “17”. DW1 said there was a change in the exchange rate from the rate stated in Exhibit “2” as shown in Exhibit “3”. It is not true that the first defendant abandoned the project at any time. There was a d request by the plaintiff for additional working capital. The request was approved by the second defendant. The approval was for N4.7 million. Every step taken by the bank was in accordance with the stipulation in Exhibit “2”. It is not true e that it was the duty of the first defendant to give the plaintiff the working capital. Clause 10 of Exhibit “2” was complied with by the first defendant. The plaintiff did not suffer any damages. The first defendant did not frustrate the project. The plaintiff obtained working capital from Diamond Bank f Plc. The plaintiff offered securities for the facility. The plaintiff has not been servicing the facility. As a result of not servicing the facility, the bank wrote letters to the plaintiff. DW1 produced copies of four of the letters and the g documents were tendered and admitted as Exhibits “18”, “18A”, “18B” and “18C”. DW1 also produced two documents relating to the personal guarantee of the Managing Director of the plaintiff and the documents were h tendered and admitted as Exhibits “9” and “19A”. DW1 said as at December, 2000 the debt had accumulated. The plaintiff did not pay any amount on the dollar-denominated facility and the Naira-denominated i facility. The plaintiff has failed to repay the facility as a result of which the first defendant has filed a counter-claim. DW1 prayed the court to order the plaintiff to repay the facility. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 15 a Under cross-examination, DW1 said that the condition precedent to the taking of the facility was that there must be adequate working capital. If working capital is not provided, b the project would be frustrated. The bank provided N4.7 million as working capital for the plaintiff, it was not the duty of the bank to provide working capital for the plaintiff. It was not the duty of the bank to provide working capital c for the project. The facility is governed by the NERFUND Act. It is not true that the bank did not serve any statement of account. She does not know when the money was made available to the bank by NERFUND. It is not true that it took the first defendant six months from the date it received d the money before it issued a letter of credit. The bank did not withhold the money. The bank forwarded the money to the plaintiff less the bank charges. The exchange rate at that time was N22 to US$1. Today, the exchange rate is N129 to e US$1. The bank did not abandon its responsibility in respect of the project, the bank is not liable to the plaintiff. On re-examination, the deed of legal mortgage and the certificate of registration of the deed of legal mortgage were f tendered through DW1 and were admitted as Exhibits “20” and “20A”. At the end of the evidence of DW1, the first defendant g closed its case. The second defendant proceeded to call its sole witness who testified as DW2. DW2, Mrs Ifenyinwa Ike in her sworn testimony said she is a lawyer and an employee of the second defendant. She is h the second defendant’s Head of Legal Services. The plaintiff is a customer to the first defendant. The first defendant is one of the second defendant’s participating banks. The plaintiff applied for a loan in April, i 1994. The first defendant submitted the application to the second defendant. All over Nigeria, participating banks bring their customers’ applications for loan to the second j defendant. The bank after the approval becomes the second

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 16 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) defendant’s obligor. The loan is sent to the customer through a the bank and if the loan is due for repayment, the second defendant demands for repayment from the bank. If the bank fails to pay, the account of the bank with the Central Bank of b Nigeria is debited. The defendant accepted the loan of US$998,590 and N6,188,000. The first defendant has paid the second defendant. The second defendant is not liable to the plaintiff. The plaintiff does not maintain an account with c the second defendant. Under cross-examination, DW2 said she was not aware that all the amount of money given to the first defendant was not given to the plaintiff. She cannot remember the d date the money was disbursed to the defendant. She is aware that a tripartite agreement was executed by the plaintiff, the first defendant and the second defendant. After the first defendant has refunded the money disbursed to it to e the second defendant, the second defendant ceded the project to the first defendant. She does not know if the consent of the plaintiff was sought and obtained before the project was ceded to the first defendant. The entire project is f now between the plaintiff and the first defendant. The obligations of the three parties are spelt out in the NERFUND Act. In re-examination, DW2 said the second defendant is g entitled to cede the project to the first defendant. There is no requirement for obtaining the consent of the plaintiff before the project could be ceded to the first defendant. At the end of the evidence of the DW2, the second h defendant closed its case. At the instance of Counsel for both sides, parties were directed to submit their written address. The defendants were given 21 days while the plaintiff was given 14 days. i The learned Counsel for the first defendant in the first defendant’s written submission filed on 25 November, 2005 drew the attention of the Court in the introductory part of the address to the reliefs of both the plaintiff’s claim and the j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 17 a defendant’s counter-claim. He then submitted that the issues for determination are:– 1. Whether the first defendant/counter-claimant is b entitled to judgment on it’s counter-claim against the original plaintiff (first defendant by counter-claim). 2. Whether the first defendant/counter-claimant is entitled to judgment on it’s counter-claim against the c second defendant by counter-claim joined by the order of court on 10 March, 2005. 3. Whether the plaintiff has any reasonable cause of action against the first defendant on the remaining d reliefs claimed against it in legs (b), (d), (f), (h) and (i) of the statement of claim. 4. Whether the plaintiff is entitled to the sum of $2,848.78 with interest thereon at the rate of 4% from e February, 1995, until this suit is determined being an alleged balance of the loan of $998,590 withheld by the first defendant. f 5. Whether the plaintiff is entitled to an order of court expunging from the plaintiff’s account, all interest charged by the first defendant from February, 1995 till the determination of the suit. g 6. Whether the plaintiff is entitled to an order of court mandating the first defendant to refund all unauthorised charges deducted from the plaintiff’s account. h 7. Whether the plaintiff is entitled to special damages. 8. Whether the plaintiff is entitled to general damages. On issue 1, learned Counsel submitted that in a claim of debt arising out of a loan once receipt of the loan is admitted by i the defendant, the burden of proving that the loan was repaid lies on the defendant. He cited Macaulay v NAL Merchant Bank Ltd (1990) 4 NWLR (Part 144) 203 at 308 in support of his submission. He contended that the plaintiff/ counter- j claim defendants in this case has neither proved that it

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 18 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) repaid the loan nor given sufficient reason for not repaying a the loan. He further contended that the explanation for not repaying the loan given by the plaintiff is untenable. He drew the attention of the court to clauses 2 and 11 of Exhibit b “2” to buttress his contention that the first defendant was right when it disbursed the loan less all costs over-run and other incidental charges. Learned Counsel submitted relying on Osumah v Edo Broadcasting Service (2004) 17 NWLR c (Part 902) 332 at 351 that the plaintiff is bound by the stipulations in Exhibit “2” which according to him, became a contract between the parties upon acceptance of the offer by the plaintiff. He urged the court relying on Zakkem Construction Company Ltd v Nneji (2002) 5 d NWLR (Part 759) 55 at 75 and Total (Nig) Plc v Akinpelu (2004) 17 NWLR (Part 903) 509 at 524 to hold that the plaintiff is bound by clause 11 of Exhibit “2” and that the first defendant is entitled to judgment as per the e counter-claim. On issue 2, learned Counsel submitted relying on Exhibits “19” and “19A” that the second defendant in the counter- f claim who guaranteed the loan given to the plaintiff is liable to pay the debt owed by the plaintiff to the first defendant when the plaintiff fails or is unable to pay the loan. He cited Saraki v Societe-Generale Bank (1995) 1 NWLR (Part 371) 126 at 345; First Bank of Nigeria Ltd v Pan Bisbilder (Nig.) g Ltd (1990) 2 NWLR (Part 134) 647 at 656 and Obikoya v Wema Bank Ltd (1991) 7 NWLR (Part 201) 119 at 128 in support of his submission. He urged the Court to consider the totality of the evidence, particularly Exhibits “15”, h “18A”, “18B”, “18C”, “19” and “19A” and to come to the conclusion that the plaintiff and the second defendant in the counter-claim are liable to repay the loan to the first defendant. i Learned Counsel submitted on issue 3 that the plaintiff has no reasonable cause of action against the first defendant. He contended that to establish that there is a reasonable cause of action, the plaintiff must show that there is a j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 19 a wrongful act of the first defendant which gives it a cause for the complaint and that it suffered damages as a result of the wrongful acts of the first defendant. He cited Thomas v b Olufosoye (1986) 1 NWLR (Part 18) 669 at 682 and Union Bank of Nigeria Ltd v Penny Mart Ltd (1992) 2 NWLR (Part 240) 228 at 245 and 246 in support of his contention. Learned Counsel submitted that the plaintiff has not led c evidence to prove the allegations made in its reply to the statement of defence and defence to the counter-claim and that therefore, the allegations should be deemed as having been abandoned. He cited Adekunle v Rockview Hotel Ltd (2004) 1 NWLR (Part 853) 161 at 178 – 179 in support of d his submission. Learned Counsel submitted that the claim for N10 million working capital having been withdrawn and thereupon dismissed, the claim for general damages predicated on the claim for N10 million working capital e cannot stand. He urged the Court to hold that the plaintiff is not entitled to general damages and to dismiss reliefs (b), (d), (f), (h) and (i) of the claim. On issue 4, learned Counsel submitted that the claim for f the sum of $2,848.78 representing the difference between $998,590 and $995,741.22 is, having regard to clauses 2 and 11 of Exhibit “2”, untenable. He urged the Court to accept the evidence of DW1 to the effect that the whole money was g disbursed to the plaintiff less fees and charges and to dismiss the claim for $2,848.78. With regard to issue 5, learned Counsel submitted that to obtain an order for the expunging of the interest charges, the h plaintiff must show that the interests charges are irregular and not in accordance with the contract between the parties. He contended that the plaintiff has not shown that the interest charges are irregular or contrary to the contract. He i urged the Court relying on General Aviation Services Ltd v Thahal (2004) 10 NWLR (Part 880) 50 at 76 and Archibong v Ita (supra) to hold that there is no basis on which the interest charges should be expunged and to dismiss that leg j of the claim.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 20 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

On issue 6, learned Counsel submitted that there is no a evidence that there were unauthorised charges which ought to be refunded to the plaintiff since the statement of account in respect of the plaintiff’s account has not been tendered b and admitted in evidence. He urged the Court relying on SCC (Nig) Ltd v Elemadu (2005) 7 NWLR (Part 913) 28 at 63 to hold that the claim has not been proved and to dismiss that arm of the claim. c Learned Counsel submitted on issue 7 that the claim for N10 million working capital in paragraph (c) of the reliefs having been abandoned and consequently dismissed the claim for special damages which according to him, is based d on the failure to provide working capital for the plaintiff is not maintainable. He urged the Court relying on Neka BBB Manufacturing Co Ltd v ACB Ltd (2004) 2 NWLR (Part 858) 521 at 540 and Ijebu-Ode Local Government v Balogun e & Co Ltd (1991) 1 NWLR (Part 166) 136 to hold that the claim for special damages has not been proved strictly and is therefore not maintainable. Learned Counsel further submitted that by clause 10 of Exhibit “2”, the plaintiff must submit satisfactory evidence confirming the availability of f working capital before there could be a drawdown or disbursement of the fund. He urged the Court to dismiss the claim for special damages. g It is the learned Counsel’s contention on issue 8 that the plaintiff to succeed on the claim for general damages must establish that as a result of the defendant’s acts, it suffered losses. He cited UBA Plc v BTL Industries Ltd (2004) 18 h NWLR (Part 904) 180 at 237 in support of his submission. He submitted that the claim based on loss of profits is a baseless, gold-digging claim. He urged the Court relying on Oceanic Bank International (Nig) Ltd v Child Industries Ltd (2001) 6 NWLR (Part 661) 464 at 480 to hold that the i plaintiff is not entitled to general damages and to dismiss the claim for N100 million general damages. He urged the Court finally to dismiss the plaintiff’s suit and to enter judgment for the defendant/counter-claimant as per the counter-claim. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 21 a The learned Counsel for the second defendant in the second defendant’s written address dated 2 December, 2005 submitted that the issues for determination are:– b 1. Whether the second defendant is a proper party to the suit; and 2. Whether the plaintiff has any claim against the second defendant and if so, has it been proved. c On issue 1, learned Counsel submitted that neither in the pleading nor in the evidence of PW1 has it been shown that there is a contract between the plaintiff and the second defendant. He contended that the tripartite agreement d between the three parties referred to in the pleadings be not put in evidence. It has not been shown that the second defendant owed any obligation to the plaintiff which it failed to perform. He cited Atufe v Ogonienor (2004) 13 NWLR e (Part 890) 327 in support of his submission that he who asserts must prove. On issue 2, learned Counsel submitted that the second defendant is not liable to the plaintiff in the sum of N94 f million as special damages and N100 million as general damages. He contended that the special damages have not been specifically proved. He urged the Court relying on Neka BBB Manufacturing Co Ltd v ACB Ltd (2004) 2 g NWLR (Part 858) 521 to hold that the claim for special damages is not maintainable. It is the learned Counsel’s further submission that the action be for breach of contract, the plaintiff is not entitled h to general damages. He contended that the action against the second defendant is statute-barred. He cited section 2(a) of the Public Officers (Protection) Act, 1990; Offoboche v Ogoja Local Government (2001) 16 NWLR (Part 739) 458 i at 489 – 490 and Eboigbe v NNPC (1994) 5 NWLR (Part 347) 649 in support of his submission. He finally urged that the suit against the second defendant be dismissed. The learned Counsel for the plaintiff in the plaintiff’s j written address dated 28 November, 2005 drew the attention

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 22 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) of the Court in the introductory part of the address to the a pleadings on the basis of which evidence was led on both sides. He also drew the attention of the Court to paragraphs 2, 5 and 6 of the first defendant’s statement of defence by b which paragraphs 1, 2, 3, 4, 6 and 9 of the statement of claim are expressly admitted and paragraphs 5, 10, 11, 12, 13, 16, 17, 18, 19, 20, 21, 22, 23, 25, 26, 28, 29, 31 and 32 of the statement of claim which he contended are not c specially traversed, he submitted that the allegations in the statement of defence which are not specially traversed are deemed to have been admitted. He cited Odiba v Muemue (1999) 10 NWLR (Part 622) 174 at 183 – 184; Adeleke v Asenifa (1990) 3 NWLR (Part 136) 94 at 113 – 114 in d support of his submission. He contended that a mere denial without answering to the material points raised in the statement of claim is deemed an admission of the allegations contained in the statement of claim. He cited Nwadike v e Ibekwe (1987) 4 NWLR (Part 67) 718 and RCC (Nig) Ltd v RPC Ltd (2005) 10 NWLR (Part 934) 615 at 628 in support of his submission. He urged the Court to hold that the allegations in the statement of claim which are not specially f traversed are admitted. He submitted that the Court ought to find on the basis of the admission and minimal proof that the facts have been established. He cited NBCI v Sparkling Dry Cleaning (Nig) Ltd (1998) 13 NWLR (Part 580) 11 at 19 in g support of his submission. Learned Counsel in his further address summed up the case of each of the parties and the evidence of the witnesses called by the parties. He submitted that the issues for h determination are:– 1. What are the obligations of the defendants in the lending transactions which has given rise to this suit? i 2. Did the first defendant duly perform its obligations towards the plaintiff under the transaction? 3. Did the second defendant duly perform its obligations toward the plaintiff under the transaction? j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 23 a 4. However the three issues above are decided, what remedy if at all is the plaintiff entitled to; and 5. Is the defendant entitled to its counter-claim? b The learned Counsel for the plaintiff on issue 1 submitted referring to the aims and objectives of NERFUND fund as stated in section 1(2)(a) – (d) of the NERFUND Act, that is, the National Economic Reconstruction Fund Decree No. 2 c of 1989, as amended referred to on page 4 of Exhibit “2” that having regard to the objective of the fund, the parties cannot contract to defeat that object. He cited Sonnar (Nig) Ltd v Norwind (1987) 4 NWLR (Part 66) 520; Dale Power d Systems Plc v Witt and Bush Ltd (2001) 8 NWLR (Part 716) 699 and Batalba v West Construction Co Ltd (2001) 18 NWLR (Part 744) 95 in support of his submission. He urged the court relying on Ariori v Elemo (1983) 1 SC 26; Auchi e Polytechnic v Okuoghae (2005) 10 NWLR (Part 933) 279 at 291 – 292 and Ogualaji v A-G, Rivers State (1997) 6 NWLR (Part 508) 209 to hold that parties to an agreement under the NERFUND Act, are not at liberty to waive or depart from f the clear provisions of section 5(1) and (2) of the Act relating to the obligations of a participating bank. Learned Counsel further submitted that under section 5(1) and (2) of the NERFUND Act, the first defendant has a duty g to provide working capital for the plaintiff and to disburse the fund released to it by NERFUND not later than three working days from the date the fund was released to it by NERFUND. He drew the attention of the Court to page 3 h paragraph (iii) of Exhibit “17” under the caption “other conditions” wherein it is stated that “the bank shall provide evidence of the availability of working capital for the project”. He submitted referring to the word “shall” in the i aforementioned paragraph (iii) on page 3 of Exhibit “17” that the obligation on the first defendant to provide working capital for the project is a mandatory obligation. He cited Okpala v DGNC for MM (1996) 4 NWLR (Part 444) 585 at j 592 – 593 and 598; Akin v Manga LGA (1996) 4 NWLR

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 24 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(Part 674) 76 at 97 and Adisa v Oyinlola (2000) 10 NWLR a (Part 674) 116 at 191 in support of his submission. Learned Counsel specifically drew the attention of the Court to page 2 of Exhibit “2”. He submitted that the b evidence of DW1 to the effect that it was not the responsibility of the first defendant to provide the plaintiff working capital ought not to be believed. He urged that it be held that the first defendant breached a vital term of the c contract when it failed to provide the plaintiff working capital for the acquisition of items of plant and machinery, customs duty, VAT, clearing charges, port charges, installation and interest during construction at Owerri. d Learned Counsel submitted on issue 2 that the first defendant as a result of the delay in opening the letters of credit, the failure to disburse the fund within three working days from the date it was released to it by the second e defendant and the failure to provide working capital for the plaintiff failed to perform its obligations to the plaintiff under the transaction. He drew the attention of the Court to the evidence of PW1 relating to the change in the exchange f rate and the change in the customs duty payable on the goods caused by the delay in the opening of the letters of credit and the delay in the disbursement of the fund. Learned Counsel submitted that having regard to the averments in g paragraphs 20 and 28 of the first defendant’s statement of defence to the effect that the first defendant has no obligation to provide the plaintiff working capital, the evidence of DW1 to the effect that the first defendant h provided working capital to the plaintiff as part of equity participation is contrary to the pleadings. He urged the court to hold that the DW1 is not a reliable witness. On issue 3, learned Counsel submitted that by not i ensuring that the fund which it released to the first defendant was disbursed to the plaintiff in accordance with the NERFUND Act, and by not ensuring that the first defendant complied with all of its obligations under the transaction, the j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 25 a second defendant failed to perform its obligation under the contract. On issue 4, learned Counsel drew the attention of the b Court to the evidence of PW1. He urged the Court to accept the evidence of PW1 and to hold that the plaintiff is entitled to both special and general damages as claimed. He submitted relying on NBCI v Integrated Gas (Nig) Ltd c (2005) 4 NWLR (Part 916) 617 at 651 and 652 and Omega Bank (Nig) Plc v OBC Ltd (2005) 8 NWLR (Part 928) 547 at 576 that the plaintiff who is the borrower in the transaction has a right to sue for damages. d With regards to the first defendant’s counter-claim, learned Counsel submitted that the first defendant cannot derive any benefit from its wrongful acts complained of by the plaintiff in this case. He cited AP Ltd v Owodunni (1991) e 8 NWLR (Part 210) 391 at 421; Olufunmishe v Falana (1990) 3 NWLR (Part 136) 1 at 10, 13 and 16 and Akuma Industries Ltd v Ayman Enterprises Ltd (1999) 13 NWLR (Part 633) 68 at 86 and 87 in support of his submission. He f contended that the first defendant having frustrated the contract by its wilful acts cannot seek the aid of the Court in the manner it has done by the filing of the counter- claim. Learned Counsel further submitted that the statement of g account in respect of the account of the plaintiff not in the evidence, the debt has not been proved. He cited Olorunfemi v NFB Ltd (2003) 5 NWLR (Part 812) 1 at 24 – 25 in support of his submission. h Learned Counsel further submitted that the first defendant is not entitled to claim in foreign currency. He cited section 5(4) of the NERFUND Act, Alao v ACB Ltd (1998) 3 NWLR (Part 542) 339 at 364 and Sodipo v Lemminkainen i OY (No. 2) (1986) 1 NWLR (Part 15) 220 in support of his submission. Learned Counsel submitted that the claim for N7,906,250 is not supported by the pleadings and the evidence since j there is no averment in the pleadings or evidence which

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 26 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) shows that the first defendant gave the plaintiff a loan, he a urged the Court relying on NNB Plc v Denclag Ltd (2005) 4 NWLR (Part 916) 49 at 606 and Alao v Akano (2005) 4 NWLR (Part 935) 160 at 180 to dismiss the claim for b N7,906,250 on the ground that it is not supported by both the pleadings and the evidence. Learned Counsel submitted that the claim in the counter- claim for interest is not maintainable since there is no c evidence in support of the claim and since the claim is based on the claim in foreign currency, which according to him, the defendant cannot make in this case. He urged that the counter-claim be dismissed. d Learned Counsel submitted that before the Chairman/ Managing Director of the plaintiff can on the basis of the personal guarantee executed by him be held liable, the plaintiff must have been adjudged liable. He cited A-G, e Lagos State v Purification Technical (Nig) Ltd (2003) 16 NWLR (Part 845) 1 at 14 in support of his submission. Learned Counsel drew the attention of the Court to paragraphs 3 and 5 of the defence to the counter-claim. He f submitted that the execution of the contract of guarantee having been denied, the first defendant/counter-claimant has a duty to prove that the Chairman of the plaintiff executed a personal guarantee. The duty, learned Counsel contended, the first defendant has not discharged. g He contended that Exhibits “19” and “19A” which bear no dates have no evidential value. Learned Counsel drew the attention of the Court to clause 3 of the deed of legal h mortgage. He contended that the deed of legal mortgage is self-contradictory. He submitted that the deed of legal mortgage in this case which is dated 24 February, 1998 about three years after the draw-down date which was in July, 1995 cannot be the deed of legal mortgage which was i registered on 27 June, 1995. He urged that it be held that the deed of legal mortgage and the certificate of registration are unreliable. He cited Uzo v Indiamaowei (1999) 13 NWLR (Part 633) 152 at 165 in support of his submission. Learned j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 27 a Counsel further contended relying on Alao v Akano (2005) 11 NWLR (Part 935) 160 at 175 at 178; Salako v Williams (1998) 11 NWLR (Part 574) 505; Shittu v Fasawe (2002) b All FWLR 1017 at 1032 and 1033 and Igbodin v Obianke (1976) 9 – 10 SC 179 that the certificate of registration of the charge being an uncertified photocopy of a public document is inadmissible. He urged that the certificate of c registration, Exhibit “20A” be expunged. Learned Counsel submitted that the withdrawal of the claim for working capital, on the ground that it is a claim for specific performance cannot extinguish the claim for d damages based on the failure of the first defendant to provide the plaintiff working capital. He urged that judgment be entered for the plaintiff as per the amended statement of claim. e The learned Counsel for the first defendant in his reply address filed on 17 January, 2006 submitted that the issue of illegality raised by the Counsel for the plaintiff in the address filed by the plaintiff must be specifically pleaded f and proved. He cited Order 26 rule 6(1) of the Rules of this court in support of his submission. He submitted that Exhibit “2” and not the NERFUND Act governs the transactions between the parties. He contended that only the second g defendant can complain of any breach of the provisions of the NERFUND Act on the part of the first defendant. The plaintiff, learned Counsel submitted, having admitted that the fund was disbursed to it, the defendant needs not h prove that the fund has not been repaid. He contended that the claim in foreign currency is competent and that the first defendant is entitled to judgment in the foreign currency or in the Naira currency at the current rate of exchange. i The foregoing is a summary of the evidence and the submissions of Counsel for both sides in this case. The issue whether the allegations in the statement of claim have been specially traversed has been vehemently j canvassed by the learned Counsel for the plaintiff in his

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 28 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) address. He also contended that the allegations in paragraphs a 5, 10 – 13, 16, 17 – 23, 25, 26, 28, 29, 31 and 32 of the statement of claim have not been specially traversed and that therefore, the allegations should be deemed to have been b admitted. The law as settled by the authorities is that a mere denial by the statement of defence of averments contained in the statement of claim without answering to the material points raised therein is not a proper answer to the averments c contained in the statement of claim and such imperfect denial is deemed an admission of the facts contained in the statement of claim. See Adeleke v Aserifa (supra) at pages 113 – 114; Nwadike v Ibekwe (1987) 4 NWLR (Part 67) 718; Odiba v Muemue (supra) at pages 187 and 188 and d Lewis and Peat (NIR) Ltd v Akhimien (1976) 1 FNR 80. The question is – what is this imperfect denial that constitutes an admission of the allegations in the statement of claim? As settled by the authorities the pleading of the defendant that e the defendant is not in a position to admit or deny certain paragraphs of the statement of claim is a general denial to positive and distinctive allegations in the statement of claim and therefore does not constitute a valid denial of the f allegations in the statement of claim. It is an imperfect denial. See Odiba v Muemue (supra) and Wallersteiner v Moir (1974) 1 WLR 991 at 1002 where Lord Denning MR held to be an imperfect traverse the pleading by the plaintiff g against whom there was an allegation of fraud in the counter-claim, which was as follows:– “The plaintiff denies that the plaintiff has been guilty of fraud, dishonesty, misfeasance or breach of trust as alleged in paragraphs h 103 of the amended counter-claim or at all.” In the present case, the first defendant pleads in paragraph 4 of the amended statement of defence and counter-claim thus:– i “4. The first defendant categorically and specifically denies paragraphs 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 and 32 of the statement of claim and put the plaintiff to the strictest proof of the averments contained therein.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 29 a The first defendant by paragraph 4 of the amended statement of defence and counter-claim above reproduced has denied generally, the allegations in the twenty-two paragraphs of b the statement of claim mentioned in paragraph 4 of the amended statement of defence and counter-claim. The first defendant further down in its pleading, explained or qualified the denial of some of the facts contained in the statement of claim. The plaintiff thereby made a special c traverse or specific denial of the allegations in the twenty- two paragraphs of the statement of claim referred to in paragraph 4 of the amended statement of defence and counter-claim. d In Odiba v Muemue (supra). The Supreme Court per Othman JSC as he then was stated thus:– “Learned Counsel is right that positive and distinctive allegations in the statement of claim must be specifically denied. This is e called a special traverse. In a special traverse, the defendant shall explain or qualify the denial of facts in a statement of claim.” In Wallersteiner v Moir (supra) Lord Denning MR, as he then was stated at page 103 thus:– f “The master did not give leave for it to be served. R.S.C. (Rules of the Supreme Court) Order 18 Rule 13(B) states expressly that a general denial is not a sufficient traverse of the allegations. So there was no valid traverse. The Counter-claim stood without any valid contradiction. So under R.S.C., Order 19 Rule 7, Mr. Moir g was entitled to judgment.” Order 26 rule 14 of the Rules of this Court provides in relation to denial of fact thus:– “Order 26 Rule 14 (1) When a party denies all allegation of fact, h he shall not do so evasively, but shall answer the point of substance. (2) When a matter of fact is alleged with diverse circumstances it shall not be sufficient to deny it as alleged along with i those circumstances but a full and substantial answer shall be given.” Considering the totality of the pleading of the first defendant in the amended statement of defence and counter-claim, it j seems to me a full and substantive answer to the points

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 30 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) raised in the twenty-two paragraphs of the statement of a claim have been given. I hold that there is no evasive denial of the allegations in paragraphs 10 – 13, 16, 17 – 23, 25, 26, 28, 29, 31 and 32 of the statement of claim. On the b authorities, the aforesaid paragraphs of the statement of claim cannot be deemed to have been admitted along with the allegations in paragraphs 1, 2, 3, 4, 6, 7, 8 and 9 of the statement of claim which have by the averment in paragraph 2 of the amended statement of defence and counterclaim c been expressly admitted. The pleading in paragraph 3 of the amended statement of defence and counter-claim is evasive. I hold that paragraph 5 of the statement of claim has not been specially traversed, paragraph 5 of the statement of d claim is therefore deemed to have been admitted. The law is that facts admitted need not be proved. The allegations in paragraphs 1, 2, 3, 4, 5, 6, 7, 8 and 9 are therefore deemed to have been established. See Archibong e and others v Ibe and others (2004) 2 NWLR (Part 857) 590 at 628 and RCL (Nig) Ltd (supra) at page 628. By the admissions of the allegations in paragraphs 1, 2, 3, 4, 5, 6, 7, 8 and 9, it has been established that there was a NERFUND f loan transaction between the parties and that the sum of $998,590 US Dollars was released by the second defendant to the first defendant on 7 February, 1995. The first defendant by the averments in paragraphs 10 and 11 of the g amended statement of defence and counter-claim has admitted that it opened a letter of credit in July, 1995 and that it thereafter disbursed all the sums approved by the second defendant to the plaintiff. The pleadings and the h evidence on both sides show that the money which was released to the first defendant by the second defendant on 7 February, 1995 was not released to the plaintiff until sometime in July, 1995. The delay in opening the letter of credit and the delay in releasing the fund has been some of i the main complaints of the plaintiff in this case. The evidence of PW1 relating to the delay has not been impugned. I accept his evidence and on the basis of his evidence and the pleadings in this case, I find that the letter j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 31 a of credit was opened in July, 1995 subsequent to which the sum of $995,741.22 was released to the plaintiff leaving a balance of $2,848,78. I find that the first defendant kept the b fund released to it by the second defendant for not less than six months before it disbursed it to the plaintiff. The plaintiff’s other cause for complaint is the failure of the first defendant to provide the plaintiff working capital c for the project. The first defendant has in its pleading, categorically denied that it had any obligation to provide the working capital for the project. See paragraphs 21 and 22 of the amended statement of defence and counter-claim. The d evidence of PW1 in this case is that the first defendant has an obligation under the National Economic Reconstruction Fund Act, formerly Decree No. 2 of 1989 to provide the plaintiff working capital. The evidence of DW1 is that the first defendant does not have that obligation under Exhibit e “2” which is the agreement between the parties. Counsel for both sides have strongly canvassed the issue of whose obligation it is to provide the working capital for the project. The first defendant’s Counsel has relied on the stipulations f in Exhibit “2” while the learned Counsel for the plaintiff has relied on the provisions of the NERFUND Act. Clause 10 of Exhibit “2” relied on by the learned Counsel for the first defendant is in the following terms:– g “10. The Company shall submit a satisfactory evidence confirming the availability of working capital for the project.” The learned Counsel for the plaintiff on the other hand has relied on the provision of section 5(1)(a) of the NERFUND h Act, which is in the following terms:– “5 (1) The participating banks shall - (a) provide the working capital required by eligible enterprises and projects under this Act.” i Under the caption “other conditions” on page four of Exhibit “2”, provision is made for certain conditions. The said provision is in the following terms:– “1. This facility is subject to– j i. Normal Bankers Demand Rights.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 32 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

ii. C.B.N. guidelines and circular as may be from time to a time. iii. Other conditions that may be imposed by NERFUND by virtue of Decree No. 2 of 1989.” b As expressly stated in sub-paragraph (iii) of paragraph 1 above reproduced, the agreement in Exhibit “2” is subject to the provisions of the NERFUND Act. It seems to me that the agreement between the plaintiff and the first defendant c evidenced by Exhibit “2” has a statutory flavour and that the parties have no capacity to dispense with any provision of section 5(1) of the NERFUND Act having regard to the use of the word “shall” in the provision. The use of the word “shall” in the provision certainly is mandatory and not d directory or permissive. The word “shall” prima facie has an obligatory, imperative or peremptory connotation. See Okpala v Director-General of National Commission for Museums and Managements and others (supra) at pages 592 e – 593 and Adamu Akun Mangu Local Government Council (supra) (sic) at page 216. It is my firm view that the first defendant has a statutory obligation to provide working capital for the project in this case. What the law maker f intended to prevent, that is, the frustration of the project has in this case, taken place as a result of the failure of the first defendant to provide working capital for the project. Paragraph 10 on page 1 Exhibit “2” relating to working g capital cannot be construed to defeat the object of section 5(1)(a) of the NERFUND Act. I hold that for failing to provide working capital for the project in compliance with the provision of section 5(1)(a) of the NERFUND Act, the first defendant breached or violated a vital term of the h contract between it and the plaintiff. With regard to the issue of the first defendant not disbursing the fund released to it on 7 February, 1995 to the plaintiff promptly, learned Counsel for the plaintiff placed i reliance on section 5(2) of the NERFUND Act, which is in the following terms:– “Section 5(2) Each participating bank shall disburse funds to approved enterprises or projects not later than three j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 33 a working days of release of the funds to the participating bank.” The evidence of PW1 in this case which has not been b challenged or materially contradicted is that the fund which was released to the first defendant on 7 February, 1995 was not disbursed to the plaintiff until sometime in July, 1995. The first defendant acted contrary to the mandatory c provision of section 5(2) of the NERFUND Act, when it failed to disburse the fund to the plaintiff within three working days of the release of the funds by NERFUND. The evidence of PW1 which I accept, is that the consequences of the failure of the first defendant to open a letter of credit for d the plaintiff to facilitate prompt importation of the machinery, the failure of the first defendant to disburse the funds in accordance with the requirements of section 5(2) of the NERFUND Act, and the failure of the first defendant to e provide working capital for the project are:– 1. Importation of machinery was delayed and clearance of the goods when they arrived was stalled. f 2. The goods arrived late and at the time the goods arrived, the exchange rate had increased from N22 per US$1 to N80 per US$1 and custom duties payable on the goods had been reviewed upwards to the g detriment of the plaintiff. 3. The machinery cannot be installed and the project cannot take off with the result that the plaintiff suffered financial losses. h 4. To enable the plaintiff (sic) clear the goods, the plaintiff was forced to obtain a loan from Diamond Bank Plc. The sole witness for the first defendant who testified as i DW1 did not materially contradict the evidence of PW1 in relation to the consequences of the failure of the first defendant to comply with the requirements of the NERFUND Act stated by the PW1 in his evidence. On the j basis of the pleadings and the evidence of PW1, I find that

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 34 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) the NERFUND loan transaction between the plaintiff and a the defendants was frustrated by the failure of the first defendant to comply with the mandatory requirements of section 5(1)(a) and (2) of the NERFUND Act. The failure to b comply with the provisions constitutes a breach of the agreement between the plaintiff and the first defendant evidenced by Exhibit “2”. The plaintiff has claimed both special and general c damages in this case. The right of the borrower to sue for damages for the failure of the bank to advance or disburse (sic) loan is undoubted. See Nigerian Bank for Commerce and Industry v Integrated Gas (Nig) Ltd (supra) at page 652 d where Edozie JSC as he then was stated thus:– “In the instant case if the parties had agreed on a fixed date for the disbursement of the loan and due to the Appellant’s default, the cost of the importation had escalated far beyond the cost price at e the fixed date for the disbursement, I think the plaintiff would have been entitled to recover as damages, the excess amount it costs them to import the machinery and even if they were unable to import the goods, they would have been entitled to damages for breach of contract.” f See also Mayne and Macgregor on Damages (12ed), page 553 where the learned author stated thus:– “In contracts for the loan of money, the normal measure of damages for the lender’s failure to provide the fund is the amount g required by the borrower to go into the market and effect a substitute loan for himself less the amount the contractual loan had required. There may also be consequential losses. Thus, the damages may include the cost of raising the money elsewhere. Further, the plaintiff may recover for the loss of any contract h which hinged upon the loan if the defendant was aware of the purpose for which the plaintiff was entering into the loan.” See also Manchester and Oldham Barth v Cook (1883) 49 LT 674 and Astor Properties v Tunbridge Wells Equitable i Friendly Society [1936] 1 All ER 531 where the money to be lent was to be used by the plaintiff for a purchase, money mortgage damages were allowed for the estimated loss of the rents that the plaintiff would have obtained from the j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 35 a property for the period of delay before the plaintiff obtained the property by means of a substitute loan. Having regard to the evidence and the authorities some of b which have been cited in this judgment, I think the plaintiff is entitled to special damages in this case. The defendant has wilfully or deliberately failed to tender the statement of account in respect of the account of the plaintiff with the c first defendant. By failing to tender the statement of account to demonstrate why the sum of $2,848.78 was withheld, the defendant has not justified the withholding of the sum of $2,848.78. The plaintiff is entitled to be disbursed the d balance of $2,848.78. The plaintiff’s statement of account not being the evidence, there is no evidence that any amount of money was charged as interest to be paid by the plaintiff on both the e Dollar-denominated loan and the Naira-denominated loan on the basis of which the sum of $2,848.78 can be withheld. The project for which the loan was obtained having been frustrated by the default on the part of the first defendant, f the first defendant is certainly not entitled to charge interest on the loan. I hold that the first defendant is not entitled to charge interest and debit the account of the defendant based on the NERFUND loan. To charge interest on the account of g the NERFUND loan is certainly tantamount to the first defendant benefiting from its wrongful acts. If any interest has been charged and the account of the plaintiff is therefore debited, the plaintiff is entitled to a refund of the unlawful h charges. The plaintiff has claimed the sum of N94 million as special damages. The evidence of PW1 which has not challenged or contradicted, is that if the factory has been i commissioned the plaintiff’s monthly profit from the business would not be less than N1 million. I accept the evidence of PW1. Exhibit “2”, the loan agreement between the plaintiff and the defendant was executed on 7 j July, 1994.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 36 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The moratorium period during which the project was a expected to have been completed was a period of one year from the date of disbursement which was July, 1995 when the sum of $995,741.22 was disbursed to the plaintiff. It was b expected that at the end of the twelve months, the project would be completed for business to commence. I think the plaintiff is entitled to loss of profit from the end of the moratorium period which was July, 1996. From July, 1996 c to April, 2006 is a period of nine years and nine months. The plaintiff is entitled to loss of profit for this period of nine years and nine months at the rate of N1 million per month. The total sum is N117 million. But the plaintiff has claimed N94 million as loss of earning. The plaintiff cannot have d more than what it has claimed. With regard to the sum of N100 million claimed as general damages, the plaintiff is not entitled to the N100 e million claimed as general damages. The claim of N10 million for the maintenance of the staff has not also been proved. This action be for breach of contract usually, general damages cannot be contemplated. See Omonuwa v Wahabi f (1976) 4 SC 37 and Universal Vulcanizing (Nig) Ltd v Ijesha United Trading Co. Ltd (1992) 9 NWLR (Part 266) 388 at 412 where the Supreme Court, per Onuh JSC stated thus:– g The object of awarding damages for breach of contract is to put the injured party, so far as money can do, in the same position as if the contract had been performed.” If the first defendant had complied with the provisions of section 5(1) and (2) of the NERFUND Act, by disbursing h the funds as required by the NERFUND Act and providing the plaintiff with working capital as required by the NERFUND Act and the project was completed within the moratorium period, the plaintiff should have been i earning N1 million as profit monthly from the end of the moratorium period. To award the plaintiff general damages after the award of loss of profit will amount to double compensation. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 37 a On the whole, the plaintiff’s action succeeds. Judgment is hereby entered for the plaintiff against the first defendant in the sum of:– b (A) $2,848.78 plus interest on the sum of $2,848.78 at the rate of 4% per annum from 7 February, 1995 to today, 5 April, 2006. (B) N84 million be loss of profit from July, 1996 to c May, 2005 at the rate of N1 million per month. The case against the second defendant has not been proved. The absence from the evidence of the tripartite agreement is fatal to the case against the second defendant. The case d against the second defendant is dismissed.

Counter-claim The first defendant claims as per the amended statement of e defence and counter-claim dated 15 April, 2005 as follows:– 1. Judgment in the sum of USD998,590 (nine hundred and ninety eight thousand, five hundred and ninety United States Dollars), being the balance of the f dollar-denominated loan granted to the first defendant by counter-claim by the plaintiff (by counter-claim) and guaranteed by the second defendant (by counter- claim) and owing and due to the plaintiff (by counter- g claim) as at the close of business on 3 December, 2000 or its equivalent in the local currency ie Naira at the current rate of foreign exchange at the Autonomous Foreign Exchange Market. h 2. Judgment in the sum of N7,906,250 (seven million, nine hundred and sixty thousand, two hundred and fifty Naira) being the balance of the Naira- denominated loan granted to the first defendant (by i counter-claim) and guaranteed by the second defendant (by counter-claim) by the plaintiff (by counter-claim) and owing and due to the plaintiff (by counter-claim) as at the close of business on 31 j December, 2000.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J 38 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

3. Interest on the aforesaid sums at the rate of 18% per a annum from the first day of January, 2001 until the date of judgment. 4. Interest after judgment. b The evidence led on both sides show that the project for which the loan was taken by the plaintiff has not taken off because, the first defendant frustrated the project by not c complying with the mandatory provisions of section 5(1) and (2) of the NERFUND Act, I think until the project is completed the first defendant which is an obligor adjudged of not having performed its obligation under the loan agreement is not entitled to repayment of the loan until it has d performed its obligation under section 5(1) and (2) of the NERFUND Act. The right of the first defendant, which is not the lender but the obligor in the transaction to a refund is predicated on it having performed its obligations under the e NERFUND Act. Furthermore, the law as settled by the authorities is that the usual way of proving a debt and entitlement to interests thereon is by putting in the statement of account or f secondary evidence thereof where admissible. See Olorunfemi v Nigerian Education Bank Ltd (2003) 5 NWLR (Part 812) 1 at page 24 – 25 and Union Bank of Nigeria Plc v Sparkling Breweries Ltd (2000) 15 NWLR (Part 689) g 200. In the present case, the statement of account of the plaintiff has not been put in evidence. The loan and the h interest thereon have not been proved. It seems to me the first defendant not being the lender, its entitlement as an obligor to be refunded (sic). What it paid to NERFUND is predicated on it having performed its mandatory obligation under the NERFUND Act. The first defendant has a duty to i perform its obligations under the NERFUND Act by ensuring that the project is, not as a result of any default on its part, frustrated before it can ask for a refund and interests on the sum disbursed to the plaintiff. j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT OF NIGERIA) Abutu J Brokenn Agro Allied Ind. Ltd. v. Oceanic Bank Int. (Nig.) Ltd. 39 a In Olorunfemi v Nigerian Education Bank Ltd (supra) the Court of Appeal, per Musdapher JCA, as he then was stated at page 24 thus:– b “There was no evidence that Alpha had charged any penalty. The trial court was wrong to have inferred that Alpha or the Respondent had charged the penalty. In any event, there is no statement of account. The only evidence which one might say is credible is contained in Exhibit ‘9’ which put the total c indebtedness and interest as at 31/7/1993 at the sum of N724,828. . . The usual way of proving a debt is by putting in the statement of account or secondary evidence where it is admissible.” d On the whole, I hold that the counter-claim has not been proved. The counter-claim is dismissed.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

40 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

a Olori Motors Company Ltd v Union Bank of Nigeria Plc b SUPREME COURT OF NIGERIA KUTIGI, KATSINA-ALU, PATS-ACHOLONU, OGUNTADE, MUKHTAR JJSC Date of Judgment: 7 APRIL, 2006 Suit No.: SC.278/2001

Lis pendens – Mortgagee obtaining judgment – Debtor c filing an appeal and stay of execution – Notices of not served on creditor – Creditor selling mortgaged property – Whether a case of lis pendens Lis pendens – Mortgagee obtaining judgment against d mortgagor – Thereafter purporting to sell property in exercise of his power of sale under the mortgaged deed – Propriety of e Lis pendens – Principles governing Mortgage – Mortgagee obtaining judgment – Later selling property under the mortgage deed – Propriety of Words and phrases – Lis pendens – Meaning of f

Facts The plaintiff who is now the respondent in this appeal obtained judgment of the high court in the sum of g N7,947,373 and another N84,710 odd being a further outstanding balance in the current account at the interest of 21% from 28 August, 1988 till the date of that judgment, and further 5% until the whole sum was liquidated. It is the h case of the appellants that on the same date of the judgment the defendants now the appellants filed a notice of appeal and followed it up with filing a motion for stay of execution. The story of the appellants was that after judgment was i delivered which necessitated the appellants taking further steps such as filing an appeal and a stay of execution to have the judgment of the high court reversed by the Court of Appeal, the respondent went ahead and sold the mortgaged j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Olori Motors Company Ltd. v Union Bank of Nigeria Plc 41 a property. The case of the respondent is that after the judgment of the high court, without it in the least knowing that the appellants had filed some processes in the court to b have the judgment of the high court set aside, it had as judgment creditor executed the judgment of the high court on 15 April, 1994. The appellant applied to the high court now presided over c by another Judge to set aside the sale. The high court agreed and set aside the sale holding that the motion for stay of execution hitherto filed in the high court has on the decision of Vaswani Trading Company v Savalakh and Company d (1972) 12 SC 77 acted as a temporary restraining order. As a matter of fact that property was sold by auction, the respondent not relying squarely on the judgment of the court by which the appellants became judgment debtors. The High e Court had held inter alia, that though the respondent was not served with the processes, the court was of the opinion that since the processes were filed early enough, the respondents should be deemed and/or presumed to know about such f filings, and, further holding that the respondent acted recklessly and in utter bad faith. On appeal to the Court of Appeal by the respondent, that court reversing the judgment of the high court held:– g “(a) that the sale was made under the mortgage deed not under the judgment of the court; (b) that it was wrong for the High Court to have imputed h knowledge of the new processes filed in the court without the benefit of the respondent knowing about it; and (c) it blamed the appellants for lack of diligence and thereupon allowed the appeal.” i The appellant having appealed to this Court stated that the bottom line of this case is “whether the sale was in exercise of the power of sale under the deed of mortgage or not the fact remains that the mortgage property is the subject of the j suit pending in the Court of Appeal.”

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

42 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Held – a 1. Lis pendens denotes those principles and rules of law which define and limit the operation of the common law maxim, to the effect that nothing relating to the subject b matter of a suit can be changed while it is pending, and subject to certain limitations and qualifications considered infra, one who with actual or constructive notice of the pending action, acquires from a party c thereto an interest in the property involved in a litigation in a court having jurisdiction of the subject matter and of the person of the one from whom the interest is acquired, takes subject to the rights of the parties to the litigation d as finally determined by the judgment or decree. 2. There have been opinions to the effect that regardless of either implied notice or constructive notice, since the doctrine is based empirically on public policy, that if a e person acquires a property still a subject matter of court proceedings, he acquires only subject to the right of whoever becomes the victorious party. In considering the extent of the application of lis alibi pendens, the f courts must be careful not to overly extend its application too wide as it could lead to all manner of problems and perhaps injustice for there must be an end to litigation. It will in my view not be quite in accord with prudence and even in the interest of public policy g that an action cannot be regarded as having come to an end after the delivery of a judgment and when a party executing the judgment of the court by way of sale commences such a sale more than two months after the h determination of the action completely ignorant of any processes filed and yet be caught by the operation of this doctrine. 3. It accords with good sense that the losing party who after i filing an appeal and also an application for stay of execution immediately the judgment was given should hasten to notify or inform in one way or the other the victorious party of his intention to pursue the case j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Olori Motors Company Ltd. v Union Bank of Nigeria Plc 43 a further. The doctrine of lis alibi pendens should be understood to be a philosophical tenet which takes into consideration the realities of human society and the b nature of the mobility of a vibrant society. Its application must reflect the times. 4. For one to file a process in the court and abandon it for some months with same not being brought to the c knowledge of the other party, should not in all fairness be allowed to invoke the doctrine of lis pendens. 5. Therefore, the doctrines and principles which were developed to help understand the nature of law and its d applicability in relation to finding remedies should necessarily follow the development of the society as no society is static and doctrines relied to remedy a wrong while seemingly immutable ought to be applied flexibly e to reflect the growth and necessary bent of the society. 6. The expression lis pendens variously interpreted in different forms means a pending action or suit or a controversy in court particularly in relation to the subject f matter of a property. There is implicit in the doctrine of lis pendens that a buyer who purchases a property still subject of a determination of the court has bought for himself a big trouble as the outcome can be against the g vendor. 7. Per curiam “On another level, there was indeed a deed of mortgage on which the respondent based its sale. In other words, it h exercised another option open to it to secure the financial benefit due to it. Shall we blame the respondent when it resorted to exercising the option of sale through the covenant or stipulation in the deed.” i Appeal struck out. Cases referred to in the judgment Nigerian j Alakija v Abdulai (1998) 6 NWLR (Part 552) 1

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

44 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Dan-Jumbo v Dan-Jumbo (1999) 11 NWLR (Part 627) 445 a Eperokun v University of Lagos (1986) 4 NWLR (Part 34) 162 b Ogundiani v Araba (1978) 6 – 7 SC 55 Olale v Ekwelendu (1989) 4 NWLR (Part 115) 326 Osagie v Oyeyinka and another (1987) 3 NWLR (Part 59) 144 c Pavex Int Co Ltd v IBWA (1994) 5 NWLR (Part 347) 685 UBA Ltd v Edionseri (1988) 2 NWLR (Part 74) 93 Vaswani Trading Co v Savalakh (1972) 12 SC 77 d Foreign First Bank of Eureka Spring v Cook go SW 2d 510 Massachusetts Bonding and Insurance Co v Knox 18 SE 2d e 436 Mitchell v Federal Bank of St Louis 174 SW 2d 671 People ex rel O’Connor v City of Chicago 20 NE 2D 306 f Nigerian statutes referred to in the judgment Constitution, 1999, sections 6(6)(a), 6(6)(b) Court of Appeal Act, 1976, section 18 g

Book referred to in the judgment Corpus Juris Secundum Volume 54, page 570 h Judgment KUTIGI JSC: (Delivering the lead judgment) The facts will be stated briefly. Judgment was entered in favour of the plaintiff against the defendants in the sum of N7,949,273 i and N84,710 with interest by the Benin High Court. The defendants without delay filed a notice of appeal simultaneously with a motion for stay of execution. The plaintiff was never served. Meanwhile the plaintiff levied j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Kutigi JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 45 a execution by selling some of the defendants’ mortgaged properties. On becoming aware of the development, the defendants applied to the High Court to set aside the b execution. The application was granted and the execution was set aside. Dissatisfied with the ruling setting aside the execution, the plaintiff appealed to the Court of Appeal which allowed the appeal and dismissed defendants’ c application to set aside the execution. The defendants have now appealed to this Court against the decision of the Court of Appeal. The defendants/appellants on page 2 paragraph 1.4 of d their brief of argument in support of their appeal have stated as follows:– “This present appeal is against the decision of the Court of Appeal. It is worthy of note that the Court of Appeal has subsequently e allowed the appeal against the judgment of the trial court in the substantive suit.” (Italics mine.) It is clear to me therefore that this appeal is now lifeless, spent, academic, speculative and hypothetical, being an f interlocutory appeal only, while the substantive suit or appeal itself has been disposed of and or completed (see for example Olale v Ekwelendu (1989) 4 NWLR (Part 115) 326; Union Bank of Nigeria Ltd v Edionseri (1988) 2 NWLR g (Part 74) 93. It must be emphasized here now that this Court does not issue opinions about potential cases. The Court hears appeals or cases that present actual threat to individual rights. A case must present a current problem that is yet to be resolved. It must be stressed also that a party bringing a h case must have a vested interest in the issues raised and in its outcome. This appeal has failed all the tests. The defendants/appellants and or their counsel should have taken steps to withdraw this appeal before now. They failed to do i so. I am of the firm view that this appeal must fail on this ground as this Court is without jurisdiction. There is therefore no need for me to consider the issues raised in the appeal. It must in the circumstances therefore be struck-out j and I so order.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Kutigi JSC 46 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The appeal is struck-out. The plaintiff/respondent is a entitled to his cost which is assessed at N10,000 against the defendants/appellants. b PATS-ACHOLONU JSC: The appeal in this case revolves around an issue of law. But it is desirable and I dare say essential to give the synopsis of the facts giving rise to the appeal. The plaintiff who is now the respondent in this c appeal obtained judgment of the high court in the sum of N7,947,373 and another N84,710 odd being a further outstanding balance in the current account at the interest of 21% from 28 August, 1988 till the date of that judgment, and further 5% until the whole sum was liquidated. It is the d case of the appellants that on the same date of the judgment the defendants now the appellants filed a notice of appeal and followed it up with filing a motion for stay of execution. I must have to say here that the case arose from the alleged e inability of the appellants to redeem his mortgaged property under the deed of a legal mortgage. The story of the appellants was that after judgment was f delivered which necessitated the appellants taking further steps such as filing an appeal and a stay of execution to have the judgment of the high court reversed by the Court of Appeal, the respondent went ahead and sold the mortgaged property. The case of the respondent is that after the g judgment of the high court, without it in the least knowing that the appellants had filed some processes in the court to have the judgment of the high court set aside it had as judgment creditor executed the judgment of the high court h on 15 April, 1994. Let me here digress a little and dwell briefly on some missing links. No date as it turned out was fixed for hearing of the motion for stay by the trial Judge before her i retirement. Meanwhile of course execution had been levied. I have to state that by my calculation, from the date of the judgment to the actual date of sale was exactly 70 days. The appellant applied to the high court now presided over by j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 47 a another Judge to set aside the sale. The high court agreed and set aside the sale holding that the motion for stay of execution hitherto filed in the high court has on the decision b of Vaswani Trading Company v Savalakh and Company (1972) 12 SC 77 acted as a temporary restraining order. As a matter of fact that property was sold by auction, the respondent not relying squarely on the judgment of the court c by which the appellants became judgment debtors. The high court had held inter alia, that though the respondent was not served with the processes, the court was of the opinion that since the processes were filed early enough, the respondents d should be deemed and/or presumed to know about such filings, and, further holding that the respondent acted recklessly and in utter bad faith. On appeal to the Court of Appeal by the respondent, that e court reversing the judgment of the High Court held:– “(a) that the sale was made under the mortgage deed not under the judgment of the court; (b) that it was wrong for the High Court to have imputed f knowledge of the new processes filed in the court without the benefit of the respondent knowing about it; and (c) it blamed the appellants for lack of diligence and thereupon allowed the appeal.” g The appellant having appealed to this Court stated that the bottom line of this case is “whether the sale was in exercise of the power of sale under the deed of mortgage or not the fact remains that the mortgage property is the subject of the h suit pending in the Court of Appeal”. In other words, the scenario that presented itself before the Court was a case of lis alibi pendens. What is lis pendens. In Volume 54 page 570 of Corpus Juris Secundum which is the American re- statement of the law, the learned authors relying on i numerous cases define the scope of this doctrine of lis pendens as follows:– “It denotes those principles and rules of law which define and limit the operation of the common law maxim, to the effect that nothing j relating to the subject matter of a suit can be changed while it is

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 48 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

pending and subject to certain limitations and qualifications a considered infra, one who with actual or constructive notice of the pending action, acquires from a party thereto an interest in the property involved in a litigation in a court having jurisdiction of the subject matter and of the person of the one from whom the b interest is acquired, takes subject to the rights of the parties to the litigation as finally determined by the judgment or decree.” See People ex rel O’ Connor v City of Chicago 20 NE 2d 306, Massachusetts Bonding and Insurance Co v Knox 18 c SE 2d 436, Mitchell v Federal Land Bank of St Louis 174 SW 2d 671 at 675; First Bank of Eureka Spring v Cook go SW 2d 510. d There have been opinions to the effect that regardless of either implied notice or constructive notice, since the doctrine is based empirically on public policy, that if a person acquires a property still a subject matter of court e proceedings, he acquires only subject to the right of whoever becomes the victorious party. In considering the extent of the application of lis alibi pendens, the courts must be careful not to overly extend its application too wide as it could lead to all manner of problems and perhaps injustice f for there must be an end to litigation. It will in my view not be quite in accord with prudence and even in the interest of public policy that an action cannot be regarded as having come to an end after the delivery of a judgment and when a g party executing the judgment of the court by way of sale commences such a sale more than two months after the determination of the action completely ignorant of any processes filed and yet be caught by the operation of this h doctrine. I believe that it accords with good sense that the losing party who after filing an appeal and also an application for stay of execution immediately the judgment was given, i should hasten to notify or inform in one way or the other the victorious party of his intention to pursue the case further. The doctrine of lis alibi pendens should be understood to be a philosophical tenet which takes into consideration the j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 49 a realities of human society and the nature of the mobility of a vibrant society. Its application must reflect the times. For one to file a process in the court and abandon it for some b months with same not being brought to the knowledge of the other party, in my opinion, should not in all fairness be allowed to invoke the doctrine of lis pendens. The common law or as we may say (jus commune) had its foundation on reasonableness of certain empirical elements. In its historic c and organic form, it avoids and detests abstractions or concepts that remove it from what it has become after the adventure of the Saxons in England by which time what we now regard as “Corpus juris angliae” manifested itself in a d form that recommends itself in simple and readily understandable rules. From historical perspective the origin of the common law seemed to be traceable to first the culture of Germanic tribesmen who by their Saxon’s e conquest of England revamped that country’s culture. They borrowed nothing from the Roman Law or from any nation. They knew nothing of Greek or of Rome except that the Pope who was the head of the church was said to live there. f This situation was further embellished and I would add refined after the Norman Conquest in 1086 by William the Conqueror. By fashioning for themselves domestically grown or brewed laws they equally evolved certain principles and doctrines as times went by to help build a g body of laws based on common sense, custom and reality of the day. Such doctrine as lis alibi pendens is one of such principles to deal with legal problems arising. Therefore, the doctrines and principles which were developed to help us h understand the nature of law and its applicability in relation to finding remedies should necessarily follow the development of the society as no society is static and doctrines relied (sic) to remedy a wrong while seemingly i immutable ought to be applied flexibly to reflect the growth and necessary bent of the society. The expression lis pendens variously interpreted in different forms means a pending action or suit or a j controversy in court particularly in relation to the subject

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 50 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) matter of a property. There is implicit in the doctrine of lis a pendens that a buyer who purchases a property still subject of a determination of the court has bought for himself a big trouble as the outcome can be against the vendor. b It is really difficult for me to understand and effectively and duly appreciate an argument to the effect that if a process is filed in respect of an action, or to be more appropriate and factual, if such processes as filed after a c judgment such as a stay of an execution on a matter subject of an appeal and for a period of 70 days, such notices of stay and appeal were not brought to the notice of the judgment creditor, that he should be imputed to have known that such d processes had been filed. It is in my respectful view an awkward thinking that fits only in the realm of metaphysics. I would have thought that the party who stands to lose if matters are not diligently handled, should have striven to e ensure that all processes duly filed are served on the other party. Indeed, it cannot be otherwise stated that in a matter of this nature, prudence dictates that the party to be affected adversely if nothing is done should have endeavoured to f cause service to be made by going to the registry to alert them. It is no point waving the decision of this Court in Vaswani Trading Co v Savalakh (supra) as though it is a magic wand which possesses great powers and can solve all g problems when the facts are not the same. Consider the following for example. In Vaswani Trading Co v Savalakh (supra) the Supreme Court took time to state the following:– “We are satisfied that in this case the respondents were aware that h a motion was pending before this court for a stay of execution.” (Italics mine.) The unmentioned conclusion is that if the respondents in that case had not known of the motion, the situation would have i been different. It is to my mind a twisted and oblique thinking to draw a conclusion that if a process is filed which is not to the notice of the other party for whom it is intended and he goes about j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 51 a his business totally ignorant of what might have taken place then he should be punished for it. I cannot but help endorsing without any equivocation and b agreeing with the view expressed by Uwaifo JCA (as he then was) when he said in the case of Pavex Int Co Ltd v IBWA (1994) 5 NWLR (Part 347) 685 at 696. “I think in (sic) matter like this where it is sought to show that c execution of judgment took place while an application for stay of execution had already been brought, the argument must be that in spite of that application, the execution creditor went ahead with the execution. In my respectful view, the argument cannot d be tenable without clear evidence that the execution creditor was aware as a fact of the pendency of that application in order to give the desired effect to the admonition in Vaswani Trading Co. v Savalakh (1972) 1 All N.L.R. (Part 2) 483 at 490 where the Supreme Court said inter alia– ‘We are satisfied that in this e case the respondents were aware that a motion was pending before this court for a stay of execution duly filed in accordance with law at a time when the respondents might not proceed to execution’.” f With due respect, I cannot find myself agreeing or endorsing the rather commonplace and seemingly pedestrian argument of the appellants on this point. Generally, the Court is disposed to assist a person who is awake and not the g indolent. On another level, there was indeed a deed of mortgage on which the respondent based its sale. In other words, it exercised another option open to it to secure the financial h benefit due to it. Shall we blame the respondent when it resorted to exercising the option of sale through the covenant or stipulation in the deed. To sum up, there is no way I can reverse the judgment of i the Court of Appeal from the facts and the applicable law available. In the circumstances, I agree with the lead judgment of my learned and noble Lord Kutigi JSC of which I have had the benefit of having read in draft. I allow the j appeal and abide by the orders in the lead judgment.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

52 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

MUKHTAR JSC: After judgment had been given in favour a of the plaintiff who is now the respondent in this Court, the appellants filed a motion for, “an order setting aside the execution, by way of sale, of the judgment of this b Honourable Court”. The appellants had after losing the case applied to the Benin State High Court of Justice for an order of stay of execution, which was not heard. Somewhere along the line, the properties which were the subject matter of the c motion were sold during the pendency of the application for stay of execution. The following depositions are contained in the supporting affidavit of the motion on notice:– d “2. Judgment was given in this case on the 4th day of February, 1994. That same day the first and second defendants filed a notice of appeal against the judgment and a motion for stay of execution of the said judgment, both of which are in the court’s file. The first and second defendants also paid for e service. 3. By their counter-affidavit dated the 17th day of May, 1994 and filed in respect of the application for injunction dated 18/4/94, the plaintiff averred that in execution of the f judgment dated the 4/2/94 they have sold 2 of the mortgaged properties. The sale was purportedly made during the pendency of the application for stay of execution and was aimed at foisting a fait accompli on the court. The Governor’s consent was neither sought nor obtained before g the purported sale.” In its counter-affidavit are the following salient averments:– “7. That the plaintiff/respondent have explained the true position of things in its counter-affidavit dated 17/5/94 and filed in h respect of the application for injunction dated 18/4/94 before this Honourable Court on 17/5/94. 8. That the notice of appeal against the judgment and motion for stay of execution of the said judgment both of which are i in the court’s file were not served on the plaintiff/respondent nor its counsel till 17/5/94 in this Honourable Court long after the sale of the 2 mortgaged properties. 9. That the averment in applicant’s affidavit that the plaintiff/respondent neither sought nor obtained Governor’s j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Mukhtar JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 53 a consent before the sale is not true. The plaintiff/respondent was authorized to proceed to sell the properties after the payment.” b The learned Judge before whom the application was moved granted the order of setting aside. Aggrieved by the order, the respondent appealed to the Court of Appeal. The appeal was allowed, and the order of the high court was set aside. c Aggrieved by the decision, the applicant appealed to this Court on two grounds of appeal, namely:– 1. The lower court erred in law when it held that the sale of the mortgaged property during the pendency of the d notice of appeal and motion for stay of execution was valid. (a) With the notice of appeal and the motion of stay of execution, the action in court is still pending; e (b) The doctrine of lis pendens prevents the effective transfer of rights in any property which is the subject matter of an action pending in court. f 2. The Court of Appeal erred in law when it held that the fact that the motion on notice was not served on the judgment creditor before the sale, took this case outside the purview of Vaswani Trading Company v g Savalakh & Co (1972) 12 SC 77. Briefs were exchanged by learned Counsel. An issue for determination was raised in the appellant’s brief of argument, and the issue is:– h “Whether the lower court was right when it dismissed the appellant’s application to set aside the sale of the appellant’s mortgaged property during the pendency of the appeal against the decisions of the lower court and a motion for stay of execution of i the said judgment.” In the respondent’s brief of argument is the following issue for determination:– “Whether having regard to the facts giving rise to this appeal, the j Court of Appeal was right in dismissing the appellants’ application

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Mukhtar JSC 54 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

to set aside the sale of the appellants’ mortgaged properties sold a during the pendency of the appellants’ motion for stay of execution.” In his brief of argument, learned Counsel for the appellant b has argued that it is for the respondent to ensure that it had power of sale of the mortgaged properties when it purported so to do, and to ensure that there was no pending appeal before it sold. Now, the judgment that gave the respondent c liberty to sell the mortgaged properties was delivered on 4/2/94. A notice of appeal was thereafter filed by the appellants, and a motion on notice for stay of execution was also filed, and both were unknown to the respondent, when it moved to levy execution on 15/4/94. Surely not having d been served with the processes it was ignorant of their existence. The appellants, very well conscious of the gravity of the order made by the trial court should in their own interest, in my view have been diligent enough to have e ensured that the respondent was served with the notice of appeal immediately. That as if the mere notice of appeal precludes the respondent from executing the judgment which it has laboured to obtain. By virtue of section 18 of f the Court of Appeal Act, 1976, a notice of appeal does not operate as a stay of execution, for it reads thus:– “18. An appeal under this Part of this Act shall not operate as a stay of execution, but the Court of Appeal may order a stay g of execution either unconditionally or upon the performance of such conditions as may be imposed in accordance with rules of court.” In the circumstance that the respondent was not served with h the motion for stay of execution and it was completely ignorant of it, should it have dragged its feet in executing, when it had been anxiously waiting on the case it initiated since 7/11/88? It looks like a situation where while respondent was very much alert, the appellants could afford i to sleep. The appellants should have themselves to blame for sleeping for a period of over two months when the properties were sold. I believe they should have been up and doing to ensure that all processes were served on the j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Mukhtar JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 55 a respondent. There is no way I can fault the finding of the lower court that the facts and circumstance of this case do not fall within the purview of the Vaswani v Savalakh’s case b (supra), for the difference is clear, so to speak. In the Vaswani case, the respondent in the application to set aside was very much aware of the pending application for stay of execution, but in this case, the respondent was not, and it has c not been disputed. The appellants in their brief of argument have however informed the Court that the Court of Appeal has subsequently allowed the appeal against the judgment of the d trial court in the substantive suit. On the other hand, the respondent in its own brief of argument has submitted that the Supreme Court has recently given judgment in respect of that judgment of the Court of Appeal and has sent the matter e back for re-trial. The appellants have not furnished this Court with the basis upon which the appeal to the Court of Appeal was allowed, and if or whether the issue of the propriety or otherwise of the sale of the properties mortgaged was found upon. This court has not seen either of f the judgments to be able to determine the futility or otherwise of the present exercise. In this vein, I agree with the lead judgment of my learned brother Kutigi JSC that the appeal be struck out. I also strike out the appeal. g KATSINA-ALU JSC: (Dissenting) On 4 February, 1994, judgment was entered in favour of the plaintiff against the defendants in the sum of N7,947,273 and N84,710 with h interest by the Benin High Court. Dissatisfied, the defendants on 4 February, 1994 filed a notice of appeal simultaneously with a motion for stay of execution. The defendants paid for service. The plaintiff was however not i served. In the meantime, the plaintiff levied execution by selling some of the defendants’ mortgaged property. Upon becoming aware of this development, the defendants applied j to the High Court to set aside the execution. The High Court

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC 56 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) granted the application and the execution was set aside. The a plaintiff’s appeal to the Court of Appeal was allowed and the defendants’ application to set aside the execution was dismissed. Subsequently, the Court of Appeal allowed the b appeal against the judgment of the trial court in the substantive suit. The Court of Appeal, as can be seen, has created two situations here which run parallel. The first decision of that c court relates to the motion to set aside the sale of the mortgaged property by the plaintiff. The Court of Appeal dismissed the motion to set aside the sale brought by the defendants. The effect of this is that the plaintiff was right to d sell the defendants’ property in question. The second decision by the Court of Appeal relates to the substantive suit. The judgment of the trial High Court in the substantive action concludes as follows:– e “Judgment is entered for the plaintiff in the sum of N7,947,273.00 as being the balance outstanding on the current account and loan account of the first defendant company as at 23 August, 1988 and which were guaranteed by second defendant and 3rd defendant. f Interest will be payable on these amounts at the rate of 21 % per annum from 28 August, 1988 until today’s date and at the rate of 5% thereafter until the judgment debt is fully liquidated. Subject to any necessary consent being obtained, the plaintiff is at liberty to sell the properties mortgaged by the defendants as g securities for the various facilities granted by the plaintiff.” The defendant’s appeal to the Court of Appeal, as I have already indicated, was allowed. This means that the plaintiff was not at liberty and had no right to sell the mortgaged h properties. The trial high court wittingly or unwittingly put the mortgaged property in dispute. Now in my view, the judgment of the Court of Appeal allowing the defendant’s i appeal in the substantive action has not laid to rest the sale of the property in question by the plaintiff. It must be borne in mind that the properties were sold after the judgment of the trial court in the substantive action. In other words, it j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 57 a was not a subject for determination in the substantive suit. So that the appeal did not dispose of the issue of the sale of the mortgaged property during the pendency of that appeal b (sic). The next point is whether the issue of the sale of the property is hypothetical or academic. I think not. The issue of the sale of the property is a live issue. It was the subject c matter of a different action brought by way of a motion to set aside the sale. The question I have to resolve now is whether the Court of Appeal was right when it dismissed the application to set d aside the sale of the defendant’s property during the pendency of the appeal against the decision of the lower court and a motion for stay of execution of the said judgment. e So what is the doctrine of lis pendens and how does it operate. The doctrine of lis pendens prevents the effective transfer of rights in any property which is the subject matter of an action pending in court. In its application, the doctrine f is not founded on the equitable doctrine of notice – actual or constructive. It is based on the principle that the law does not allow to litigant parties or give to them during the currency of the litigation involving any property, rights in g such property in dispute so as to prejudice any of the litigating parties. See Ogundiani v Araba and another (1978) 6 – 7 SC 55. This is good law. For it would be plainly impossible that any action or suit could be brought to h a successful termination if alienation pendente lite were allowed to prevail. One more point. It has been said that the plaintiff resorted to its power of sale under the mortgage and sold two of the i defendant’s properties without going back to court. My short answer to that is simple. When the plaintiff elected to go to court, it waived its power of sale under the mortgage. In the circumstances, I would allow this appeal and set j aside the judgment of the Court of Appeal and restore the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC 58 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) ruling of the trial court on 31 March, 1995. I award costs of a N10,000 to the defendants/ appellants.

OGUNTADE JSC: (Dissenting) This appeal brings to the fore b the ambit of the doctrine of lis pendens. The respondent, as the plaintiff at the Benin High Court, had sued the appellant, as the defendant claiming the sum of eight million, thirty- one thousand, nine hundred and eighty three Naira c (N8,031,983) being the balance due on overdraft and loan facilities (including interest) granted by the plaintiff to the defendant. It is important to add that the plaintiff had also sought an order of court empowering the plaintiff to sell the d properties mortgaged to it by the defendant to secure the loan facilities. On 4/2/94, Aiwerioghene J gave judgment in favour of the plaintiff. The judgment was concluded in these e words:– “Judgment is entered for the plaintiff in the sum of N 7,947,273.00 and N84,710.00 being the balance outstanding on the current account and loan account of the first defendant company as at 23 f August, 1988 and which were guaranteed by the second defendant and 3rd defendant. Interest will be payable on these amounts at the rate of 21 % per annum from 28 August, 1988 until today’s date and at the rate of 5% thereafter until the judgment debt is fully liquidated. g Subject to any necessary consent being obtained, the plaintiff is at liberty to sell the properties mortgaged by the defendants as securities for the various facilities granted by the plaintiff. h The counter-claim is dismissed.” (The italics are mine.) On 31/5/94, the first and second defendants by their Counsel filed an application praying for:– “(a) An order setting aside the execution by way of a purported i sale of the judgment (sic) of this Honourable Court dated the 4 of February, 1994. (b) And for such further or other orders as this Honourable Court may deem fit to make in the circumstances.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 59 a In the affidavit in support of the application it was deposed thus:– “2. Judgment was given in this case on the 4th day of February, b 1994. That same day the first and second defendants filed a notice of appeal against the judgment and a motion for stay of execution of the said judgment, both of which are in the court’s file. The first and second defendants also paid for service. c 3. By their counter-affidavit dated the 17th day of May, 1994 and filed in respect of the application for injunction dated 18/4/94 the plaintiff avers that in execution of the judgment dated the 4/2/94 they have sold 2 of the mortgaged d properties. The sale was purportedly made during the pendency of the application for stay of execution and was aimed at foisting a fait a compli on the court. The Governor’s consent was neither sought nor obtained before the purported sale.” e The plaintiff, in reaction to the affidavit of the first and second defendants deposed to a counter-affidavit. Paragraphs 3 to 8 of the said counter-affidavit read thus:– f “3. That the plaintiff/respondent bank sued the defendant/ applicants in 1988 and judgment was delivered in favour of the plaintiff/respondent on 4/2/94. 4. That as soon as the plaintiff/respondent obtained judgment on 4/2/94 it wrote letters dated 7 February, 1994 applying for g consent to sell the mortgage properties of Messrs Olori Motors and Company Ltd, and delivered same to the Ministry of Lands on 7/2/94. 5. The plaintiff/respondent also paid the prescribed fees to the h Ministry of Lands and obtained official receipts from the Ministry. The plaintiff/respondents’ letters with receipts dated 7 February, 1994 issued by the Ministry of Lands now shown to me are attached and marked as exhibits A – A3 and B – B3 respectively. i 6. That thereafter the plaintiff/respondent proceeded to authorise its auctioneers to advertise the sale of the properties enumerated in the applications and the receipts. 7. That the plaintiff/respondent have (sic) explained the true j position of things in its counter-affidavit dated 17/5/94 and

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 60 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

filed in respect of the application for injunction dated 18/4/94 a before this Honourable Court on 17/5/94. 8. That the notice of appeal against the judgment and motion for stay of execution of the said judgment both of which are in the court file, were not served on the plaintiff/respondent b nor its counsel till 17/5/94 in this Honourable Court long after the sale of the 2 mortgaged properties.” (Italics mine.) It is manifest from the extracts of the affidavit and counter- affidavit above that:– c (1) The plaintiff had filed a notice of appeal on 4/2/94, the same date the judgment was given. (2) The plaintiff had also filed on the same date a d motion for stay of execution of the terms of the judgment given on 4/2/94. (3) The defendant had not been served the notice of appeal and the motion for stay of execution until e 17/5/94 although the two processes were by common agreement in the court file. The application to set aside the execution levied by the plaintiff was heard by Idahosa J who on 31/03/95 delivered f his ruling thereupon. The learned Judge in his ruling said at pages 32 – 33:– “In the instant case, judgment was delivered on 4 February, 1994. On the same day, the first defendant/ applicant filed a notice of g appeal and also filed a motion for stay of execution. The second defendant/applicant did not file any motion for stay of execution. From the judgment, I have seen that the court gave the plaintiff authority, subject to any necessary consent being obtained to sell the properties mortgaged by the defendants as securities for the h various facilities granted by the plaintiff. It is, perhaps, for this reason that plaintiff did not bother to file an application for a writ of fifa. This (is) where in my view the action of the plaintiff overtook the application filed by first defendant for i a stay of execution, and it explains why the sale was not stopped by the court Registrars when a motion for stay had been filed as plaintiff used the services of an auctioneer. In spite of this particular situation, I am of the firm view, that the plaintiff having taken upon itself the responsibility (sic) j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 61 a conducting the sale by its agent, ought to have kept in close touch with the court Registrar for any information as to any development by way of an appeal or an application for a stay of execution. In this case, the plaintiff will be deemed to have known about the b motion as it was timeously filed through the Deputy Sheriff of the court who is deemed to have known about it, and he is taken as the agent of the plaintiff for execution purposes. See Order 2 Rule 29 of the Judgment (Enforcement Rules) and page 85 of the Report in c the case of Vaswani v Savalkh (supra). It is also my view that plaintiff acted recklessly by not making inquiries from the court before carrying out the sale as it had taken the sale (which would ordinarily have been conducted by a court bailiff) from the court. It was therefore its duty to ensure that there d was no procedural hindrance to any sale. This is why (sic) decline to agree with learned counsel for plaintiff that the sale was made in good faith. In the case of Vaswani v Savalakh (supra) and the case of Sanni v e Otusanya cited at page 80 of the Report of Vaswani’s case the Supreme Court set aside a writ of possession already executed and returned the parties to the original status quo, pending the determination of the motion for stay of execution. The situation in this instant application is similar to that in Vaswani’s case. f The sale which had been carried out by the plaintiff and its agents cannot be allowed to stand, in view of the fact that it was made while a motion for stay of execution regularly filed had not been resolved. In the words of G.B.A. Coker, J.S.C. - g ‘More important, however, is the duty of this court, as indeed that of other courts, to ensure that its orders are not nugatory’. See page 85 of the case of Vaswani’s report.’ In view of all that I have said, I will make the following order i.e. h the sale carried out by the plaintiff or its agents on the 15th day of April, 1994 is hereby set aside pending the hearing and determination of the motion for a stay of execution by the first defendant on 4/2/94. Plaintiff shall pay N25.00 to first defendant as costs.” (Italics mine.) i The plaintiff was dissatisfied with the ruling of Idahosa J. It brought an appeal against it before the Court of Appeal, Benin Division (ie the court below). The court below on 23/4/98, in a unanimous judgment allowed the appeal and j set aside the ruling of the High Court. The court below

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 62 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) anchored its reasoning on the fact that the plaintiff had not a been served the notice of appeal and the motion for stay of execution. The plaintiff, the court below said, could not therefore be said to have acted in the abuse of the processes b of court. At pages 72 – 73 of the record, the court below said:– “In the present case however, in the absence of proof of service of even the notice of appeal on the appellant not to talk of the service c of the motion for stay of execution itself, the appellant and the lower court cannot be accused of any abuse of the process of court on the account of the appellant’s exercise of its powers of sale under the mortgage deed without having recourse to the execution of the judgment through the processes of the trial court. The d circumstances surrounding the failure of the respondents to bring to the notice of the appellant of the application for stay of execution pending in the High Court as contained in the affidavit in support of the application are quite unfortunate because the delay was brought about by the retirement of the learned trial e Judge after delivering her judgment in favour of the appellant on 4/2/94 and the difficulties experienced by the respondents in getting the motion re-assigned to another Judge for fixing a date for hearing. It is my view that the appellant cannot be blamed for f all these unfortunate events that caused delay in serving the motion for stay on the appellant to justify terming its conduct in selling the mortgaged properties as an abuse of court process because if the respondents had exercised a little more diligence, they could have served the appellant with at least the notice and g grounds of appeal already filed within time to put the appellant on notice of the pending appeal before the motion for stay of execution could have become ready for service. If this step had been taken by the respondents, the situation in the present case would have been different. Therefore having regard to all I have h said in the resolution of the lone issue for determination in this appeal, I am of the view that the lower court applied the decision of the Supreme Court in the case of Vaswani & Co. v Savalkh & Co. (supra) wrongly in setting aside the sale of the respondents’ i mortgaged properties which was carried out while their application for stay of execution of the judgment was pending before the lower court. In any case, the relief sought by the respondents in their application as earlier quoted in this judgment is not even pending appeal but for an indefinite period. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 63 a In the result, this appeal succeeds and it is hereby allowed. The ruling of the lower court of 31/3/95 setting aside the sale of the respondents’ mortgaged properties is hereby set aside. In its place, an order dismissing the respondents’ application is hereby made.” b The first and second defendants were dissatisfied with the judgment of the court below. They have brought this final appeal against it. In their appellants’ brief, one issue was identified as arising for determination in the appeal. The c issue reads:– “Whether the lower court was right when it dismissed the appellant’s application to set aside the sale of the appellants’ mortgaged property during the pendency of the appeal against the d decision of the lower court and a motion for stay of execution of the said judgment.” Appellants’ counsel has argued that the doctrine of lis pendens prevents the effective transfer of right in any e property which is the subject-matter of an action pending in court – Dan-Jumbo v Dan-Jumbo (1999) 11 NWLR (Part 627) 445; Alakija v Abdulai (1998) 6 NWLR (Part 552) 1 at 17. f It was submitted that the lower court was wrong in validating the sale of the mortgaged property during the pendency of the motion for stay of execution and a valid appeal against the judgment of the High Court. Counsel g further argued that whether the sale was an exercise of the power of sale under a mortgage deed or not, the fact remained that a suit was pending in the Court of Appeal by force of the notice of appeal filed. Finally, counsel said that h with a bit of diligence, by conducting appropriate searches in the court’s records, the defendant would have known of the pendency of both the notice of appeal and the motion for stay of execution. Counsel referred to Vaswani Trading Co. i v Savalakh & Co (1972) 12 SC 77. The respondent’s Counsel, in his brief, took the same position as the court below did, that since there was no evidence, that the notice of appeal and the motion for stay of j execution had been served on the plaintiff at the time the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 64 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) defendant’s properties were sold, the principle in Vaswani a Trading & Co v Savalakh & Co (supra) would not apply. Counsel relied on Pavex Int Co Ltd v IBWA (1994) 5 NWLR (Part 347) 685 at 696. It was submitted that the b plaintiff had not been shown to have acted in bad faith. Counsel submitted that there was a distinction between the exercise of a power of sale derived under a mortgage deed and the exercise of a power of sale following a court c judgment. Counsel also raised objection to the appellant’s ground of appeal No. 1(b), contending that the issue of lis pendens, was not raised before the two courts below, and that the d same could not be raised before this Court without leave being sought and obtained. My reaction to the objection by defendant’s counsel is that the same is without a valid basis. Whilst it is true that e parties had not used the Latin words “lis pendens” in their arguments before the two courts below, it is obvious that the case had been all about whether or not there was power in the defendant to sell the mortgaged properties of the plaintiff f at the time when a suit concerning same was before the Court of Appeal. “Lis pendens” simply means “a pending suit”. It is beyond argument therefore that the parties had been locked in a dispute about the applicability of “lis pendens”, even if they had not employed the Latin words in g their disputations before the two courts below. There was also the argument by defendant’s Counsel that a distinction existed between the sale of property under a h deed of mortgage, and a sale done under the terms of a court judgment. The court below also expressed the same view. I think that this argument overlooks the fact that the plaintiff in its claim had prayed the court for an order empowering it to sell the properties mortgaged to it by the defendant to i secure the loan facilities. The trial court in its judgment granted the order. It is therefore inappropriate to argue that the plaintiff sold the properties, pursuant to power derived under a mortgage deed as it is clear for all to see that the j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 65 a order to sell the properties, subject to certain consents being obtained was made by the trial court. The central issue in this appeal is whether or not the fact b that the notice of appeal and the motion for stay of execution had not been served on the plaintiff prevents the doctrine of lis pendens applying to the sale of the properties which the defendant mortgaged to the plaintiff. It is beyond argument c that the mortgaged properties had been in dispute before the trial court. It is also not in dispute that if the notice of appeal and the motion for stay of execution had been served on the plaintiff, the court would have set aside the sale d effected by the plaintiff in line with the decision in Vaswani Trading Co v Savalakh Co (1972) 12 SC 77. So, does non- service of the relevant processes on plaintiff make all the difference? In answering this question, it is important to bear e in mind the nature of the doctrine of lis pendens and how it operates. In Ogundiani v Araba and another (1978) 6-7 SC 55 at 78-80, this court per Idigbe JSC discussed “lis pendens” f thus:– “The doctrine of lis pendens prevents the effective transfer of rights in any property which is the subject matter of an action pending in court during the pendency in court of an action. In its g application against a purchaser of such property the doctrine is not founded on the equitable doctrine of notice – actual or constructive – but upon the fact that the law does not allow to litigant parties or give to them, during the currency of the litigation involving any property, rights in such property, (i.e. the h property in dispute), so as to prejudice any of the litigating parties. As was stated in Bellamy v Sabine (1857) 26 LJ (NS) Equity Reports 797 at 803: (Italics mine.) ‘It is . . . a doctrine common to the courts of both law and i equity, and rest . . . upon this foundation, that it would be plainly impossible that any action or suit could be brought to a successful termination if alienations pendente lite were permitted to prevail . . .’. (per Turner, L.J. in Bellamy v Sabine) and as was said by Lord Coke (usually regarded as j one of the greatest exponents of the ‘Common Law’)

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 66 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

“pendente lite nihil innovetur”. In Sorrell v Carpenter (1728) a 2 P. Wms 482, the plaintiff instituted an action against Ligo, upon a claim which the decree established to certain leasehold estates. Pending the suit, Ligo sold the property involved to Carpenter. The question was whether Carpenter b qua purchaser could sustain his purchase. Although upon some formal ground the bill in that case was dismissed, Lord King (Lord Chancellor) was unequivocal in his view that Carpenter could not sustain his purchase. A very important c aspect of this doctrine which is germaine to the facts in this case is reflected in the head note in Sorrell (supra) and it reads– ‘A purchase pendente lite though without actual notice and for valuable consideration, yet shall be set aside . . . d but as it is hard enough in some cases to make people take notice of a decree, it is harder still to oblige them to take notice of a pendency of a suit; and in case of a real purchase pendente lite, the plaintiff is to be held to strict e proof. And if any flaw at the hearing be on the plaintiff’s side, the court will not let him amend, but if the purchase pendente lite be fraudulent, and to elude the justice of the court, it ought to be highly discountenanced’. f Now, applying the doctrine of lis pendens to the facts in the case in hand what do we find? The following salient facts emerge– (1) Ashiru, sells the property 46, Akpata Street, Shomolu, Lagos – the subject matter of a court action and during the g pendency of the said action to the appellant in circumstances, undoubtedly, fraudulent. (2) The sale was undoubtedly made during the pendency of the action because at the time of the sale the decision of Oyemade, J., was being prosecuted by both the ligating h parties who each appealed from the judgment; and an appeal is in law a continuation of the prosecution of the original cause or matter which is the subject of the appeal (see also Kinsman v Kinsman (1831) 1 Russ & M 617; also 39 E.R. i 236). (3) What was pending before Oyemade, J., whose decision was on appeal to the Supreme Court at the time of the sale of the disputed property by Ashiru to the appellant, was the claim of the bank for specific performance by Ashiru of his j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 67 a obligation under the Memorandum of Deposit of title Deeds to convey to the bank the same legal estate in the disputed property, later purportedly conveyed to the appellant.” b See also Osagie v Oyeyinka and another (1987) 3 NWLR (Part 59) 144 at 155. Now in Dan-Jumbo v Dan-Jumbo (1999) 11 NWLR (Part 627) 445, this Court had to consider the validity of a grant of c probate made at a time an appeal was pending on a case concerning the administration of the will of a deceased. Relying on the doctrine of lis pendens, the High Court and the Court of Appeal set aside the grant made while an appeal d was pending. This Court, per Wali JSC at page 456 distinctly agreed with the views of Kolawole JCA thus:– “In the circumstances of this case, I agree with Kolawole, J.C.A. in the lead judgment when he opined thus– e ‘The fifth appellant/defendant did not take the appropriate steps which he should have taken after the entry of caveat by the respondent. The fifth appellant, in my view ought to have issued a notice to appear against the caveator, respondent, on behalf of the first to fourth appellants whose application for a f grant had been stopped as the fifth appellant clearly admitted in paragraph 7 of his statement of defence thus– “That as a result of the caveat filed by the plaintiff the 5th defendant was estopped from the grant of probate”. g In my view, the fifth appellant was not entitled to grant probate to the other four appellants after the conclusion of the case by Allagoa, J. on 10 April, 1972 when an appeal had been lodged against the judgment. There was no necessity to apply for a stay of execution as the lis was still pending and the Will was still in h litigation. The position was admirably put at page 1147 of the Lord Trimlestown case by Sir John Nicholl thus– ‘The taking of an administration with a Will annexed, which Will was in litigation, is, at least, practising a deception upon i the court . . . The administration too was obtained, after knowledge that caveat had been entered which was never warned, and that caveat having expired, this administration was taken without giving any notice to the other party. At least then it was obtained, to use a tender expression, j irregularly . . .’

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 68 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

On the issue of lis pendens. The learned Justice commented and a concluded as follows– ‘True, so many years have elapsed since the filing of the appeal in PHC/49/71 and the institution of action in this b appeal on 21st May, 1979 in suit number PHC/137/79 but that appeal has not been determined on its merit and neither has it been terminated on the application of the respondents to the appeal. On that basis, there is lis pendens and the principle is that the law does not allow to the litigant parties c or give to them during the currency of the litigation involving any property rights in such property so as to prejudice any of the litigating parties. (See Ogundaini v Araba and Barclays Bank of Nigeria Ltd (1978) 6 – 7 SC 55 d at p. 78, John A. Osagie v S. O. Oyeyinka and Another (1987) 3 NWLR (Part 59) 144 at p. 155, Steven Omo Ebueku v Sunmola Amola (1988) 2 NWLR (Part 75) 128 at p. 155.”

The fact relied upon by the plaintiff, that it sold the e properties because it did not know of the existence of an appeal and had not been served with a motion for stay of execution, would not in my view derogate from the fact that, at the time the properties were sold, an appeal had been f filed. What makes the doctrine of lis pendens applicable is not whether or not the immediate parties to the dispute had notice of the appeal; lis pendens applies by the operation of the law and operates independent of the will of the parties. Even a person who is not a party to the case but who bought g the property in dispute is bound by the doctrine. The practice in England is to have the judgment raising lis pendens registered so that any one intending to deal in the property may be put on notice. This is in accordance with sections 4 h and 7 of 2 and 3 Vict. C. 11, which provide for registration of lis pendens. In Nigeria however, we operate under the common law. The reasoning of the court below would seem to convey i that once one of the parties is not aware that an appeal has been filed, the doctrine would not apply. But as was said in Dan-Jumbo v Dan-Jumbo (supra) it is not even necessary to bring an application for stay of execution in a case where lis j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 69 a pendens applies. There is no doubt that when an application for stay of execution is brought, it enables the parties to know what is going on and affords the court an opportunity b to intervene and give conditions as to the terms of an order staying of execution. Whilst therefore it is advisable and useful to bring an application for stay of execution, the mere existence of an appeal prevents the effective transfer of c rights in any property, which is the subject-matter of any action pending in court during pendency in court of the action. In practice, “lis pendens”, suspends the individual rights of the parties in the property, which is the subject- matter of a dispute in court. d The peculiar facts of this case must be borne in mind. The trial court had given judgment for the amount claimed in favour of the plaintiff and also made an order that the e mortgage properties be sold provided the necessary consents were obtained. The same day the judgment was given, the defendants filed an appeal and a motion for stay of execution. Unfortunately however, the Judge who gave the judgment retired shortly thereafter. The result was that the f motion for stay of execution was not promptly served, as there was no sitting Judge to give the hearing date. When the plaintiff proceeded to sell the properties, it did so through a private auctioneer, and the court had no notice of it. If the g plaintiff had attempted to sell through the court, it would have known that an appeal and a motion for stay of execution had been filed. It seems to me that in the particular circumstances, the plaintiff ought to have made h enquiries as to whether an appeal had been filed. Now, the defendants/appellants in paragraph 1.4 at page 2 of their brief stated:– “This present appeal is against the decision of the Court of Appeal. i It is worthy of note that the Court of Appeal has subsequently allowed the appeal against the judgment of the trial court in the substantive suit.” Does the above information preclude this Court from j deciding this appeal on its merit? I think not. In the first

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 70 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) place, the above information does not convey that there has a been no further appeal from the judgment of the Court of Appeal in the substantive suit to this Court. It is common knowledge that the Court of Appeal is not the final court on b a matter as this. Secondly, it ought to be borne in mind that a statement that an appeal has been allowed does not in the circumstances of this case translate into a disposal of the case itself considering that an appeal may be allowed and a c retrial ordered. Thirdly, we have clear evidence that the defendants’ properties were sold at a time when an appeal, now said to have been allowed, was pending. Unless, I am minded to set the parties on a bout of fresh litigation, in d order to set aside the sale already done, and it cannot be ruled out, that the judgment of the Court of Appeal allowing the appeal on the substantive suit, will be effectuated, I must decide this case on its merits. Finally, it must be said that e facts of this appeal distinctly raise three scenarios, namely:– 1. If the judgment of the Court of Appeal in the substantive suit allowed the appeal by dismissing plaintiff’s suit, it is still necessary to pronounce on the f validity of the sale done by the plaintiff whilst the appeal was pending. 2. If there is a further appeal from the judgment of the Court of Appeal on the substantive suit to this court, it g is still necessary to protect the res in dispute and this also raises the applicability of lis pendens. 3. If the Court of Appeal had in its judgment on the h substantive suit ordered a retrial, it is still necessary to protect the res by invoking lis pendens whilst the suit is being retried. The result is that a judgment on the merit of the appeal i before us, is not just simply desirable, it is necessary and unavoidable if the dispute that led to the appeal is to be finally resolved. It cannot escape attention that neither the plaintiff nor the defendants argued before us that the issues j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 71 a in dispute had ceased to exist following the judgment of the Court of Appeal in the substantive suit. It seems to me that where a party has a right of appeal b which is derived from the Constitution of Nigeria and has in exercise of that right filed a valid appeal and raised from the grounds of appeal issues for determination which have been formulated from the grounds of appeal, there is no right or c privilege in this Court to refuse to adjudicate on the issues on the ground that the appeal is academic or hypothetical. The defendants’ contention from the high court is that his properties which he mortgaged to the plaintiff were sold d whilst litigation concerning same was still pending. The high court decided in the defendants’ favour that the properties were wrongly sold. The court below reversed the ruling of the High Court; and a further appeal has been brought to this court. e In Olale v Ekwelendu (1989) 4 NWLR (Part 115) 326 at 349; this court per Obaseki JSC observed:– “This court has on several occasions declared and emphasised that f the 1979 Constitution which established it has not conferred on it jurisdiction to deal with hypothetical, academic or political questions.” Similarly in Union Bank of Nigeria Ltd v Edionseri (1988) 2 g NWLR (Part 74) 93 at 105 this court per Nnaemeka-Agu JSC said:– “The constitutional role of this court as well as all other courts established by or under Section 6 of the Constitution of the Federal Republic of Nigeria, 1979 is to decide issues between parties in h the litigation. In the ipsissimi verbis of the Constitution the courts are empowered to decide– ‘. . . all matters between persons or between all government or authority or any person in Nigeria and (to) all actions and i proceedings, relating thereto, for the determination of any question as to the civil rights and obligations of that person’. So under the Constitution, there must be a lis between any of the persons named in Section 6 before any court can invoke its judicial power. Conversely, when there is no lis between two parties this j court has no jurisdiction, as it cannot indulge in the luxury of

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 72 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

a mere advisory opinion, no matter how beneficial it may be to the a legal profession or the world at large. It has no constitutional power to do so.” Let me say here that although the two cases cited above, b Olale v Ekwelendu (supra) and Union Bank v Edionseri (supra) dealt with the situation under the 1979 Constitution, the position is still the same under the 1999 Constitution. In the appeal before us there is a lis on which parties are locked c in a dispute. The issue in contest relates to a well-known doctrine of the common law. The question is – ought a party be allowed to sell a property in dispute while there is still litigation pending on the property? As it appears to me, the d information that the Court of Appeal has allowed the appeal on the judgment in the substantive suit has only reinforced the necessity for this Court to set aside the sale of the defendant’s properties. The judgment, which the plaintiff relied upon to sell the properties no longer exists. This e appeal, is no doubt an interlocutory one, but by virtue of the issue in dispute, has acquired a separate life of its own.

I must respectfully say here in clear terms that this appeal f is not about the applicability of section 18 of the Court of Appeal Act, which provides:– “An appeal under this Part of this Act shall not operate as a stay of execution but the Court of Appeal may order a stay of execution g either unconditionally or upon the performance of such conditions as may be imposed in accordance with rules of court.” This is because this appeal is not about the failure of the defendants to ask for a stay of execution. They in fact filed h an application for stay of execution the same day the judgment was given which did not get off the ground because the trial Judge went on retirement shortly after the judgment. This appeal is more about failure of justice than anything else. Should this Court validate the sale of the i properties of a party to a dispute at a time when litigation was still pending? It is necessary that I say clearly that section 18 of the Court of Appeal Act does not prescribe or convey that the properties subject to litigation may be sold j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Olori Motors Company Ltd. v Union Bank of Nigeria Plc 73 a whilst the litigation is still pending. Rather, what it does is to impose the necessity on a party appealing not to rely on the appeal as creating a stay of execution but to bring an b application to enable the Court of Appeal determine whether or not to grant a stay. Neither can section 18 be construed as preventing the court from setting aside the sale of properties done in the course of litigation. c The doctrine of lis pendens had come into existence as a part of the common law and its sole purpose is to ensure that the jurisdiction of the court, in disputes, is not rendered ineffectual through the destruction or transfer from person to d person of the property subject to litigation. In its application in Nigeria, it has become a doctrine of constitutional importance. Section 6(6)(a) and (b) of the 1999 Constitution provides:– e “(6) The judicial powers vested in accordance with the foregoing provisions of this section– (a) shall extend, notwithstanding anything to the contrary in this Constitution, to all inherent powers and sanctions of f a court of law; (b) shall extend to all matters between persons, or between government or authority and to any person in Nigeria, and to all actions and proceedings relating thereto, for the determination of any question as to the civil rights g and obligations of that person.” Any law, which prescribes that a property subject of litigation may be sold in the course of the litigation, must be liable to being construed as inconsistent with the jurisdiction h of the court to be the final arbiter on the disputes concerning the rights of citizens. Such a law will be pronounced null and void as being inconsistent with the Constitution. It is against this background that one must view section 18 of the i Court of Appeal Act. Rather than be seen as a law taking away the right of aggrieved litigant who is appealing, it is in fact to provide a protection to the party who won, so that frivolous appeals are not brought with the sole purpose of j holding the hands of the successful litigant from executing

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 74 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) his judgment. In the instant appeal, the judgment, which the a plaintiff relied upon to effect the sale of the defendant’s properties no longer exists, the same having been set aside by the same Court of Appeal which refused to set aside the b sale of the defendant’s properties. Even if the act of the plaintiff is excusable on the ground that it was not aware of the filing of an appeal and application for stay of execution, such justification in my humble opinion could not be given c for the refusal of the court below to set aside a sale made during the pendency of an appeal. This connotes an attitude that what has been sold must remain sold. The equitable jurisdiction of the court to annul (sic) unconscionable sale would have been cast overboard by such approach. d An appeal is only academic or hypothetical when the questions raised therein do not arise from the facts of the case before the court: See Eperokun and others v University e of Lagos (1986) 4 NWLR (Part 34) 162. The question whether or not the plaintiff rightly sold the defendant’ properties while a suit thereon was pending cannot be academic. This is because we have the undisputed facts before us that the defendant’s properties were sold and that f when this was done, an appeal had been filed. The only excuse offered by the plaintiff was that it had no knowledge that an appeal had been filed. The judgment by the Court of Appeal in the substantive suit has no bearing whatsoever on g the situation. In the final conclusion, I am respectfully unable to agree with the lead judgment by my learned brother Kutigi JSC. I would allow this appeal and set aside the judgment of the h court below. The ruling of Idahosa J on 31/03/95 is restored. I award in defendant’s/appellant’s favour against the plaintiff/respondent costs of N10,000. Appeal struck out. i

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Ezomo v New Nigeria Bank Plc 75 a Ezomo v New Nigeria Bank Plc and another b (Appellant substituted by order of court dated 16/1/2001) COURT OF APPEAL, BENIN DIVISION BULKACHUWA, ADEREMI, ALAGOA JJCA Date of Judgment: 12 APRIL, 2006 Suit No.: CA/B/169/2000 c Lis pendens – Doctrine of – Principles governing Lis pendens – Persons buying property pendete lite – Effect Mortgage – Sale of property – Notice to be given to d mortgagor in writing – Sections 125(1) and 192(1) Property and Conveyancing Law of Bendel State of Nigeria, 1976

Facts e Briefly, the facts as can be gleaned from the records are that the appellant, a medical doctor, by a “legal charge” dated 18 August, 1977 obtained an overdraft/loan of N50,000 to enable him develop a hospital Off Ugbor Road, Benin City. f Following an alleged default on the part of the appellant to repay the said loan, the first defendant bank took out a writ in court and obtained judgment against the appellant in the sum of N161,524.66 inclusive of interest at 13% arising g from the said overdraft. On 2 August, 1991 the appellant who was dissatisfied with the judgment referred to, filed a notice of appeal against the said judgment. The appellant contended that while this appeal was pending at the Benin h Division of the Court of Appeal, the first respondent executed on 7 October, 1992 in favour of the second respondent a Deed of Transfer of the said appellant’s property as contained in the legal charge/mortgage dated 18 i August, 1977. The said transfer was said to have been made by the first respondent to the second respondent after the former had purportedly sold to the latter the said charged mortgaged property by private treaty for the sum of j N120,000.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

76 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The appellant’s appeal earlier referred to was dismissed a on 19 January, 1995 for want of prosecution. The appellant has further contended that the property, the subject matter of the suit was sold/transferred by the first respondent to b the second respondent while the appeal was still pending and therefore the doctrine of “lis pendens” applies. The appellant further contended that the first respondent bank failed and/or neglected to give notice in writing c to the appellant that his mortgage or legal charge property was to be sold as required by law. The appellant further contended that the first respondent exercised his power of sale mala fide and without reasonable caution and so failed to obtain a proper price from the second d respondent, thus rendering the purported sale null and void. The respective amended statements of defence of the first and second respondents earlier referred to, substantially denied these averments. The case then proceeded e to be heard. The appellant gave evidence but called no witness.

The first respondent called two witnesses while the f second respondent gave evidence but called no witnesses. The respective Counsel for the parties addressed court and the learned trial Judge Idahosa J in his judgment of 26 May, 1999 found in favour the respondents. It is in respect of this judgment that the appellant, by a notice of appeal dated 26 g July, 1999, appealed to the Court of Appeal.

Held – h 1. The doctrine of lis pendens is aimed at preserving the subject matter of litigation during the pendency of an action in court. It is the jurisdiction power, or control required by a court over property while a legal action is i pending. 2. A person who purchased a property pendente lite, though without actual notice and for valuable consideration, cannot in law sustain his purchase. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Ezomo v New Nigeria Bank Plc 77 a 3. The principle enshrined in the doctrine of lis pendens applies to both tangible and intangible res as regards both the right to property and right to a declaration. b 4. Generally, the doctrine of lis pendens prevents the effective transfer of rights in any property, which is the subject matter of an action pending in a court during the pendency in court of the action. c 5. In its application against any purchaser of such property, the doctrine is not founded on the equitable doctrine of notice – actual or constructive – but upon the fact that the law does not allow to litigating parties or give to d them, during the currency of the litigation involving any property rights in such property, that is the property in dispute, so as to prejudice any of the litigating parties. 6. A combined reading of sections 125(1) and 192(1) of the e Property and Conveyancing Law Cap 129 Volume 5 Laws of Bendel State of Nigeria, 1976 applicable in Edo State indicate that a mortgagee must give notice to a mortgagor of intention to sell a mortgaged property and f that such notice shall be in writing. Again there is nothing to show from the records that the letter to foreclose was served on the appellant before sale. Appeal allowed. g Cases referred to in the judgment Nigerian h Abdullahi v Oba (1998) 6 NWLR (Part 554) 420 African Newspaper v Federal Republic of Nigeria (1985) 2 NWLR (Part 6) 137 A-G, Abia State v A-G of the Federation (2002) 6 NWLR i (Part 763) 264 A-G, Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255 j Ajide v Kelani (1985) 3 NWLR (Part 12) 248

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

78 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Ajuwon v Akanni (1994) 14 LRCN 72; (1993) 9 NWLR a (Part 316) 182 Akibu v Oduntan (1992) 2 NWLR (Part 222) Alade v Olukade (1976) 2 SC 183 187 b Allen v John Holt Co Ltd (1935) 12 NLR 13 Allied Bank Plc v Bravo WA Ltd (1996) 3 NWLR (Part 439) 710 c Ariori v Elemo (1983) 1 SCNLR 1 Ayeni v Dada (1978) 3 SC 35 Barclays Bank of Nig Ltd v Ashiru (1978) 6 – 7 SC 99 d Bokini v John Holt and Co Ltd (1937) 13 NLR 109 Bruce v African and Eastern Trade Corp Ltd (1928) 9 NLR 118 e Bua v Dauda (1999) 12 NWLR (Part 629) 59 Clay Industries Nig v Aina (1997) 52 LRCN 2038; (1997) 8 NWLR (Part 516) 208 Combined Trade Ltd v ASTB Ltd (1995) 6 NWLR (Part 404) f 709 Da Rocha v Hussain (1958) 3 FSC 89; (1958) SCNLR 280 Doma v Ogiri (1997) 1 NWLR (Part 481) 322 g Etim v Ekpe (1983) 3 SC 12; (1983) 1 SCNLR 120 Etim v Queen (1964) 1 All NLR 38 Ewan v ACB Ltd (1986) 1 QLRN 229 h Fawehinmi v Inspector General of Police (2002) 7 NWLR (Part 767) 606 Fojule v Federal Mortgage Bank of Nigeria (2001) 2 NWLR (Part 697) 384 i Globe Fishing Industries Ltd v Coker (1990) 7 NWLR (Part 162) 265 Honika Sawmil (Nig) Ltd v Hoff (1994) 2 NWLR (Part 326) 252 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Ezomo v New Nigeria Bank Plc 79 a Ihekwoaba v ACB Ltd (1998) 10 NWLR (Part 571) 590 Inland Containers Ltd v RCT Co (Nig) Ltd (1997) 8 NWLR (Part 517) 505 b Kigo (Nig) Ltd v Holman Bros Nig Ltd (1980) 5 – 7 SC 60 Lawson v Afani Construction Co (Nig) Ltd (2000) FWLR (Part 109) 173; (2002) 2 NWLR (Part 752) 585 c Maidara v Halilu (2000) 13 NWLR (Part 684) 257; 2000 FWLR (Part 19) 433 Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR (Part 524) 198 d Muhammed v Kayode (1997) 11 NWLR (Part 530) 584 Nnwaji v Coastal Services (Nig) Ltd (1999) 11 NWLR (Part 628) 641 e Nsirim v Nsirim (1990) 3 NWLR (Part 138) 285 Nwokoro v Onuma (1999) 12 NWLR (Part 631) 342 Odua Investment Company Ltd v Talabi (1997) 10 NWLR (Part 523) 1 f Ogundiani v Araba (1978) 6 – 7 SC 55 Ojelade and another v Soroye (1998) 5 NWLR (Part 549) 284 g Ojikutu v Agbonmagbe Bank Ltd (1966) 2 All NLR 277 Okafor v A-G, Anambra State (1988) 2 NWLR (Part 79) 736 Okonkwo v CCB (Nig) Plc (1997) 6 NWLR (Part 507) 48 h Orakwute v Umolu (1998) 7 NWLR (Part 557) 266 Osagie v Oyeyinka (1987) 3 NWLR (Part 59) 144 Osasona v Ajayi (2003) 14 NWLR (Part 894) 527 Osawaru v Ezeiruka (1978) 6 – 7 SC 135 i Saraki v Kotoye (1990) 4 NWLR (Part 143) 144 Savannah Bank Nig Plc v PMS Ltd (1990) 10 NWLR (Part 621) 160 j Shaibu v NAICOM (2002) 12 NWLR (Part 780) 116

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

80 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Shell Petroleum Development Co of Nig Ltd v Otoko (1990) a 6 NWLR (Part 159) 693 Shell Petroleum Development Co v Isaiah (1997) 6 NWLR (Part 508) 236 b Silencer and Exhaust Pipes Co v Farah (1998) 12 NWLR (Part 579) 624 Societe Generale Bank (Nig) Ltd v Ama (1991) 9 NWLR c (Part 619) 414 Sofolahan v Folakan (1990) 10 NWLR (Part 621) 86 Temco Engineering Co Ltd v Savannah Bank (Nig) Ltd d (1995) 5 NWLR (Part 397) 607 Unakalamba v Eze (2002) FWLR (Part 104) 527 Union Bank Ltd v Ozigi (1991) 2 NWLR (Part 176) 677 e Viatonu v Odutayo (1950) 19 NLR 119 Victory Merchant Bank v Pelfaco Ltd (1993) 9 NWLR (Part 317) 340 f Wambai v Kano NA (1965) NMLR 15 Windibiziri v Ajila (2002) FWLR (Part 132) 96

Foreign g Bellamy v Sabine (1857) 26 LJ (NS) Equity Reports 797 Sorrel v Carpenter (1728) 2 P Wms 482 Tommey v White 3 HLC 49 h

Nigerian statutes referred to in the judgment Auctioneer’s Law, Laws of Bendel State, 1976 section 19(1) i Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 sections 19, 75, 92(1) and (2) Property and Conveyancing Law Cap 129 Laws of Bendel State of Nigeria, 1976, sections 125(1), 192(1) j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Ezomo v New Nigeria Bank Plc 81 a Nigerian rules of court referred to in the judgment Court of Appeal Rules, 2002 Order 3 rule 15, Order 3 rule 2(4) b Book referred to in the judgment Black’s Law Dictionary (7ed) page 294 c Counsel For the appellant: Alegbe For the first respondent: Eghobamien (Jr) (with him Inneh); d Orbih (with him Erameh (Mrs); Ghomorai (Mrs); Inegbeboh (Mrs); Ebuchi For the second respondent: Mordi (Mrs) e Judgment ALAGOA JCA: (Delivering the lead judgment) At the High Court of Justice, Benin City, the appellant as plaintiff took out a writ against the respondents as defendants jointly and f severally for the following reliefs:– (1) A declaration that the first defendant failed and/or neglected to give notice in writing and serve the plaintiff that his mortgaged or legal charge property g known as the Royal Estate Ugbor Road, Benin City was to be sold as required by law and so the purported sale to the second defendant is null and void. h (2) A declaration that the first defendant being the mortgagee exercised his power of sale mala fide and without reasonable caution and so failed to obtain a proper price from the second defendant and thus i rendering the purported sale null and void and of no effect. (3) A declaration that the said mortgaged property was sold by the first defendant to the second defendant j during the pendency of Suit No. B/1/85 between the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 82 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

first defendant and the plaintiff which went on a appeal to the Court of Appeal on 22 August 1991 and so caught by the principle of lis pendens and thus rendering the purported sale null and void and b of no legal effect. (4) One million Naira (N1,000,000) being special and general damages for trespass committed by both defendants when they broke the plaintiff’s closed c (sic) and entered into his premises known as Royal Estate Ugbor, Benin City. (5) An order of permanent injunction restraining the second defendant, his servants and/or agents from d further entering on the plaintiff’s mortgaged property known as Royal Estate Ugbor Road, Benin City.

The plaintiff went on later to file a statement of claim dated e 12 June, 1995 which by leave of court underwent amendments finally culminating in the filing of a third amended statement of claim dated 9 April, 1997 upon which issues were joined by the consequential amended statement of defence of the first and second defendants dated 5 May, f 1997 with respect to the first defendant whilst from the records the date of the second defendant’s amended statement of defence is not indicated but there is indication that it was filed on 28 November, 1997. g Briefly, the facts as can be gleaned from the records are that the appellant, a medical doctor, by a “legal charge” dated 18 August, 1977 obtained an overdraft/loan of h N50,000 to enable him develop a hospital Off Ugbor Road, Benin City. Following an alleged default on the part of the appellant to repay the said loan, the first defendant bank took out a writ in court and obtained judgment against the appellant in the sum of N161,524.66 inclusive of interest at i 13% arising from the said overdraft. On 2 August 1991 the appellant who was dissatisfied with the judgment referred to, filed a notice of appeal against the said judgment. The appellant contended that while this appeal was pending at j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 83 a the Benin Division of the Court of Appeal, the first respondent executed on 7 October, 1992 in favour of the second respondent a deed of transfer of the said appellant’s b property as contained in the legal charge/mortgage dated 18 August, 1977. The said transfer was said to have been made by the first respondent to the second respondent after the former had purportedly sold to the latter the said c charged/mortgaged property by private treaty for the sum of N120,000. The appellant’s appeal earlier referred to was dismissed on 19 January, 1995 for want of prosecution. The appellant d has further contended that the property, the subject matter of the suit was sold/transferred by the first respondent to the second respondent while the appeal was still pending and therefore the doctrine of “lis pendens” applies. The appellant further contended that the first respondent bank failed and/or e neglected to give notice in writing to the appellant that his mortgage or legal charge property was to be sold as required by law. The appellant further contended that the first respondent exercised his power of sale mala fide and f without reasonable caution and so failed to obtain a proper price from the second respondent, thus rendering the purported sale null and void. The respective amended statements of defence of the first and second respondents g earlier referred to, substantially denied these averments. The case then proceeded to be heard. The appellant gave evidence but called no witness. The first respondent called two witnesses while the h second respondent gave evidence but called no witnesses. The respective Counsel for the parties addressed court and the learned trial Judge, Idahosa J, in his judgment of 26 May, 1999 found in favour the respondents. It is in i respect of this judgment that the appellant, by a notice of appeal dated 26 July, 1999, appealed to the Court of Appeal. When this appeal came up for hearing on 19 January, 2006, DA Alegbe, Esq. Counsel for the appellant, adopted j and relied on appellant’s brief of argument dated

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 84 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

28 February, 2003 and deemed filed on 13 March, 2003. He a also adopted and relied on appellant’s reply brief dated 21 February, 2005 and deemed filed on 17 May, 2005. He urged this Court to allow the appeal and set aside the b decision of the High Court. Counsel for the first respondent, AO Eghobamien, adopted and relied on the first respondent’s brief of argument dated 16 June, 2003 and deemed filed 8 December, 2003. He also referred to the first c respondent’s notice of preliminary objection filed on 18 June, 2003. He went on to say that the first respondent has argued the brief in two parts. The first part is the preliminary objection while the second part is the main brief. He d abandoned the first ground of objection contained on pages 3 and 4 of the first respondent’s brief while retaining the rest of the argument on the preliminary objection. He urged this Court to dismiss the appeal and affirm the judgment of the e lower court. On his part, Counsel for the second respondent, FO Orbih, Esq. adopted and relied on the second respondent’s brief dated 4 March, 2004. He also drew the attention of the Court to a notice of preliminary action filed along with the second respondent’s brief. He abandoned f grounds 1 and 2 of the said notice of preliminary objection and the arguments attendant thereto while retaining the rest of the argument and urged this Court to dismiss the appeal and affirm the decision of the High Court below. g I shall now proceed to deal with the preliminary objections incorporated in the respective briefs of argument of the first and second respondents. In support of the proposition that a preliminary point of law can be raised in h the respondent’s brief, the first respondent relied on Ajide v Kelani (1985) 3 NWLR (Part 12) 248 at 257 paragraphs C – H. The first respondent has stated on page 2 of it’s brief of argument that it has filed a separate and independent motion i raising the preliminary objection in accordance with the decisions in Nsirim v Nsirim (1990) 3 NWLR (Part 138) 285 paragraphs A – B; Savannah Bank Nig Plc v PMS Ltd (1990) 10 NWLR (Part 621) 160 at 164 paragraphs D – G j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 85 a and Sofolahan v Folakan (1990) 10 NWLR (Part 621) 86 at 97 paragraphs D – F and in her compliance with Order 3 Rule 15 of the Court of Appeal Rules, 2002, the motion has b been filed more than three days preceding the scheduled hearing of the appeal. With the abandonment of the first ground of objection tagged issue 1 on pages 3 and 4 of the first respondent’s brief, the next and only issue of objection c and tagged issue 2 on pages 5 – 7 of the first respondent’s brief of argument is whether particulars (iii) and (v) pursuant to ground 2 of the appellant’s notice of appeal arise from the ground of appeal. Counsel submitted that where a ground of d appeal is supported by particulars, such particulars must relate to or arise from that ground. Where a single particular fails in this respect, the entire ground of appeal is liable to be struck out because the court will not carry out a surgical procedure on the grounds of appeal. The following cases e were referred to in support – Orakwute v Umolu (1998) 7 NWLR (Part 557) 266 at 274 paragraphs F – G; Honika Sawmil (Nig) Ltd v Hoff (1994) 2 NWLR (Part 326) 252. Counsel submitted that in the instant case, particulars (iii) f and (v) formulated in support of ground 2 of the appellant’s notice of appeal do not relate to or arise from the said ground and should therefore be struck out and if the particulars are struck out then the entire ground of appeal g must be struck out as the court will not undertake a surgical exercise. He went further to say that even if the particulars stood on their own, the said particulars do not arise from the judgment of the trial Judge. He referred to Abdullahi v Oba h (1998) 6 NWLR (Part 554) 420 at 428 paragraphs D – E. On his own part, the second respondent’s Counsel having abandoned grounds 1 and 2 of his preliminary objection, what are left for consideration are grounds 3, 4 and 5 of the i objection, grounds 3 and 4 of which he has treated together whilst treating ground 5 of the objection first. On the said ground 5 which states that the issue of non-compliance with the provisions of section 19(1) of the Auctioneer’s Law does j not arise from any ground of appeal and consequently, the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 86 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) argument ought to be discountenanced by this honourable a Court, Counsel has submitted that there is no ground of appeal or complaint relating to the failure of the first respondent to comply with section 19(1) of the Auctioneer’s b Law, as argued under issue 3 of this ground of appeal. Counsel submitted that an issue in an appeal must be based on a competent ground of appeal, and that where an issue does not flow from a ground of appeal then it is c incompetent. He referred to Ojelade and another v Soroye (1998) 5 NWLR (Part 549) 284 particularly at page 300 paras B – C. Counsel has further submitted that Order 3 Rule 2(4) of the Rules provides that no ground which is d vague or in general shall be permitted and that any ground which is not permitted under this rule maybe struck out by the court of its own motion or on application by the respondent and that a cursory look at the notice of appeal e will reveal that items (a) – (f) do not qualify as grounds of appeal as they are all vague and in general terms. He went on to say that where there are no grounds of appeal properly couched, any venture by an aggrieved party to attack a judgment or ruling is an exercise in futility. He relied on f Societe Generale Bank (Nig) Ltd and another v Ama (1991) 9 NWLR (Part 619) 414 at 424 paragraph E, and that a good and competent ground of appeal must constitute a complaint against the decision appealed against. He relied on Nnwaji v g Coastal Services (Nig) Ltd (1999) 11 NWLR (Part 628) 641 at 658 paragraphs G – H. Counsel went on to submit further that assuming but without conceding that items (a) – (f) contained in the notice of appeal are grounds of appeal, they h would still be incompetent as they do not contain any particulars. He relied on the following cases – Windibiziri and others v Ajila and others (2002) FWLR (Part 132) 96 at page 110 C – F; Nwokoro and others v Onuma (1999) 12 i NWLR (Part 631) 342 at 352 paragraph D. He further submitted that items (a) – (f) of the notice of appeal cannot even qualify as competent particulars insofar as they are not particulars of grounds of appeal. Particulars, he said, cannot j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 87 a have a life of their own independent of a competent ground of appeal. In the circumstance, issue 1 in appellant’s brief of argument does not flow from any ground of appeal properly b so called and it is therefore incompetent and should be struck out. He relied on Unakalamba v Eze (2002) FWLR (Part 104) 527. Counsel submitted that there is no ground of appeal c complaining that the notice given to sell the appellant’s property was defective neither was there any complaint in the grounds of appeal against the alleged refusal of the learned trial Judge to apply and/or uphold the principle of d waiver to the notice of sale. The argument on waiver ought not to be entertained by this honourable Court in the circumstances. Counsel relied on Societe General Bank Ltd and another v Aina (supra). Counsel further contended that e “waiver”, as argued by the appellant’s Counsel, constitutes a new issue and that being the case, the leave of this honourable Court ought to be sought and obtained before the appellant could validly argue the same. He relied on Lawson f v Afani Construction Co (Nig) Ltd and another (2000) FWLR (Part 109) 173; (2002) 2 NWLR (Part 752) 585. Counsel therefore urged this Court to discountenance the argument on waiver appearing on pages 11 – 12 of the g appellant’s brief of argument. Replying on the preliminary objection of the first and second respondents, the appellant in his reply brief submitted that the aim of particulars of grounds of appeal h alleging error or misdirection is to highlight the complaint against the judgment on appeal. Particulars, he said, are not to be made independent of the complaint in a ground of appeal but ancillary to it. It is the particulars that ensure that i the grounds of appeal are sufficiently set out. He relied on the following cases – Osasona v Ajayi (2003) 14 NWLR (Part 894) 527 at 545 paragraphs E – G; Globe Fishing Industries Ltd v Coker (1990) 7 NWLR (Part 162) 265 at j 300 paragraphs F – G.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 88 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Counsel further submitted that it is the law that a ground a of appeal and its particulars must be compatible. He relied on Shaibu v NAICOM (2002) 12 NWLR (Part 780) 116 at 130 paragraphs A – D for this submission. Counsel b submitted that the particulars being objected to are quite compatible with ground 2 of the appellant’s grounds of appeal which deals with the notice to sell appellant’s property. Counsel went on further to say that it is now c settled that a good ground of appeal which alleges error or misdirection in law to be valid must fulfill the following conditions:– (a) Quote a passage in the judgment where the d misdirection or error in law is alleged to have occurred. (b) Specify the nature of error in law or misdirection and give full and substantial particulars of the alleged e error or misdirection. He relied on Silencer and Exhaust Pipes Co v Farah (1998) 12 NWLR (Part 579) 624 at 635 paras B – C. He submitted that ground 2 of the grounds of appeal meets those f requirements. On the issue of section 19(1) of the Auctioneer’s Law, Counsel submitted in reply that it is erroneous to argue as g was done by the second respondent that it is one of the particulars of ground 2 of the appellant’s grounds of appeal. He contended that this only came by way of submission of Counsel on issue 2 which this Court is at liberty to accept or h reject. Counsel went further to say that it is the law that particulars need not always be separately set out but may be embodied or incorporated in the grounds of appeal itself provided the ground of appeal is framed as to leave no one in doubt as to the error complained of. He relied on Osasona i v Ajayi (supra) page 545. Counsel submitted that in the instant case the error of law complained of is so embedded in the ground that it leaves no one in doubt as to the error complained of. Counsel urged the Court to dismiss the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 89 a arguments on the preliminary objections of the first and second respondents. It is clear that issue 2 of the first respondent’s objection as b well as what are referred to as grounds 3 and 4 of the second respondent’s objection relate to ground 2 of the appellant’s notice of appeal and the said ground 2 of the appellant’s notice of appeal together with the attendant particulars of c error are reproduced from page 139 of the records as follows:– Ground 2 – The learned trial Judge, Idahosa COJ, seriously erred in law when he held that the first defendant d gave notice to sell the plaintiff’s property in a letter dated 9/9/83 long before the court action in Suit No. B/1/85 and also that the said court action constituted enough notice. e Particulars of Error (i) Parties in their pleadings joined issue on the doctrine of notice, vide paragraph 9 of the third amended statement of claim and paragraphs 3 and 8 of the first f defendant’s amended statement of defence. (ii) Parties also joined issue on it in the evidence subsequently adduced in support of the statement of claim and defence, vide the evidence of plaintiff vis- g à-vis the evidence of one Eghobamien, first defendant’s accountant, who testified on its behalf on 7/10/98. (iii) If notice was given on 9/9/83 before the first h defendant went to court in Suit No. B/1/85 to recover first the amount due under the legal charge, the first defendant had waived its right to exercise of its power of sale and fresh notice would be necessary i thereafter to sell under the legal charge. (iv) Notice must be in writing and served. (v) The notice referred to at page 17 of the judgment of the learned trial Judge and accepted as such was j incredibly defective.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 90 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

It is now settled on the authorities that a ground of appeal a and its attendant particulars must be compatible. What that means is that they must be in harmony with one another. See Shaibu v NAICOM (supra). See also Maidara v Halilu b (2000) 13 NWLR (Part 684) 257; 2000 FWLR (Part 19) 433 at page 437. The question now is whether particulars (iii) and (v) are compatible with their parent ground – ground 2 of the notice of appeal. c What ground 2 is saying simpliciter is that the learned trial Judge could not have been right when he regarded the first respondent bank’s letter to the appellant dated 9 September, 1983 as good notice to the appellant that it d wanted to sell the appellant’s property covered by the “legal charge” long before the court action in Suit No. B/1/85 in which in 1991 the first respondent obtained judgment against the appellant. What particular (iii) to ground 2 of the e notice of appeal says is that by the notice given on 9 September, 1983 before the first respondent went to court in Suit No. B/1/85, the first respondent bank had waived its right to exercise its power of sale and that it would require f fresh notice to sell the property under the legal charge. Particular (v) is only supportive of particular (iii). I do not therefore see the point being made by the respondents that particulars (iii) and (v) are neither related nor arise from ground 2 of the notice of appeal. In the same vein the issue g of “waiver” which the respondents have made heavy weather of only flows naturally from the argument put forward by the appellant that with the defective notice of 9 September, 1983, first respondent had waived its power of h sale and would need fresh notice. Therefore the contention of the second respondent that “waiver” as argued by the appellant’s counsel constitutes new issue and that being the case, the leave of court ought to be sought for, and obtained i before the appellant can validly argue same, is untenable. The same argument goes with respect to the use of the word “defective” as is referable to the letter of 9 September, 1983 as not constituting good notice. It should also be noted j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 91 a that there is nothing sacrosanct about particulars to a ground of appeal as the ground of appeal can stand alone provided it is couched in such language as to import no doubt at all as to b the error in law complained of. See Osasona v Ajayi (supra). This in other words means that the ground should not be vague, unclear or too general but must be clear, precise and definite otherwise it is liable to be struck out. See Osawaru v c Ezeiruka (1978) 6 – 7 SC 135 at 137; Saraki v Kotoye (1990) 4 NWLR (Part 143) 144. Let me say without any fear of contradiction that ground 2 of the notice of appeal even without the particulars complained about which I have no reasons to fault as they are proper, is clear, precise and d definite and leaves no one in doubt about the error in law complained about and the argument that it should be struck out is untenable and unsupportable and the said arguments put up by the respondents ought to be and are hereby e dismissed. Ground 5 of the preliminary objection canvassed by the second respondent only is that there is no ground of appeal or complaint relating to the failure of the first respondent to f comply with section 19(1) of the Auctioneers Law. Counsel for the appellant has contended that this only came by way of submission of Counsel and was never a g particular to any ground and I agree with that submission. Having said this, the preliminary objections of the first and second respondents have no merit and are hereby dismissed. It is now time to go to the merits of the appeal proper. h Flowing from the grounds of appeal contained in the notice of appeal, the appellant has formulated the following three issues for the determination of this Court:– i (a) Was the property in exhibit “C” sold while litigation touching it was pending? (b) Whether the first defendant/respondent gave notice to the plaintiff/appellant as required by law before j the property contained in exhibit “C” was sold.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 92 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(c) Whether the learned trial Judge was right in holding a that the valuation report (exhibit “K”) has no weight and evidential value since the maker of the document could not give evidence. b These issues are to be found on page 5 of the appellant’s brief of argument. The first respondent has on page 8 of its brief of argument also adopted the issues as formulated in the appellant’s brief of argument. The second respondent on c the other hand has formulated the following three issues on pages 5 and 6 of his brief of argument for the determination of this Court:– (1) Whether or not the learned trial Judge was right in d holding that the doctrine of lis pendens was inapplicable to the facts and circumstances of this case. (2) Whether or not the learned trial Judge was right in e holding that there was sufficient notice to the appellant (mortgagor) before the sale of the mortgaged property. (3) Whether or not the learned trial Judge was right in f holding that exhibit “K” has no weight and evidence value since the owner could not be called as a witness. It will thus be seen that even though the issues as formulated by the second respondent are somewhat differently couched, g they are in complete harmony with the issues as formulated by the appellant and adopted by the first respondent. It is on this premise that I now want to deal with the issues using those formulated by the appellant as my guide and I h accordingly adopt them. Issue 1 – Was the property in exhibit “C” sold while litigation touching it was pending. This issue is distilled from ground 1 of the notice and grounds of appeal at page i 134 of the records. Exhibit “C” referred to here is the legal charge or mortgage dated 18 August, 1977 between the appellant and the first respondent bank. This issue simpliciter is to the effect that the sale of the property j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 93 a covered by exhibit “C” was made “pendente lite” ie while action in court was still pending and is therefore caught by the doctrine of lis pendens. This is the contention of the b appellant. Throwing more light on this development, the appellant stated that in Suit No. B/1/85, judgment was given to the first respondent in the sum of N161,524.66 plus interest on 31 October, 1985. The appellant being c dissatisfied with the said judgment lodged an appeal to the Court of Appeal, Benin Division on 22 August, 1991. On 10 April, 1992 the first respondent purportedly obtained the Governor’s consent to sell the appellant’s property contained d in exhibit “C” with which the loan was secured. On 7 October, 1992, the first respondent executed in favour of the second respondent a deed of transfer admitted in those proceedings as exhibit “B”. The appellant’s appeal that was pending in the Benin Division of the Court of Appeal was e dismissed on 19 February, 1995 for want of prosecution. Thus the sale and subsequent transfer of the appellant’s property on 7 October, 1992 was made while litigation touching the same was still pending on appeal and it does f not matter that the appellant failed to ask for a stay of execution of judgment as the first respondent was aware of the pendency of the appeal. Appellant has contended here that the law is perfectly well settled that any sale of land in g dispute while litigation touching it is pending is caught in the web of the doctrine of lis pendens and any conveyance made pursuant to and in furtherance of the sale in those circumstances is void against the appellant or mortgagor and h ought not to operate to transfer title to the purchaser (ie the second respondent). The appellant has further contended that in line with the Supreme Court decision in Ajuwon and others v Akanni and others (1994) 14 LRCN 72 at 84, 86 – i 87; (1993) 9 NWLR (Part 316) 182 for the doctrine to apply the party invoking it must plead it. He had it pleaded in his third amended statement of claim at pages 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12 and which are contained at pages 41 – 44 of j the records and both the first and second respondents joined

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 94 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) issues on this in their respective pleadings as borne out by a the records. The appellant further submitted that the doctrine of lis pendens also affects a purchaser who buys property, the subject matter of litigation during the pendency of such b litigation. He relied on the Supreme Court case of Clay Industries Nig v Aina (1997) 52 LRCN ratio 15 at page 2038; (1997) 8 NWLR (Part 516) 208. Appellant went further to submit that it is not a defence that a purchaser was c unaware at the time of the existence of a suit touching the property at the time of the purported sale and so the sale of the appellant’s property by the first respondent to the second respondent while the case was on appeal is null and void and of no effect. Counsel relied on the following cases – Osagie d v Oyeyinka (1987) 3 NWLR (Part 59) 144; Allied Bank Plc v Bravo WA Ltd (1996) 3 NWLR (Part 439) 710. Appellant submitted that the observation of the learned trial Judge in which he concluded that the claim against the e appellant by the first respondent was to recover money and did not assert title over property and so the doctrine of lis pendens does not apply is faulty, because the money being demanded by the first respondent had been secured by the f appellant’s landed property in the legal charge (exhibit “C”) and the said money cannot be divorced from the property of the appellant. He went further to submit that the essence of exhibit “C” is that it stands for the loan as collateral such g that it is either the loan is paid or the property is forfeited. The money and the landed property are therefore one and the same as the money is indeed mortgage money. The appellant said that in his notice of appeal he had stated that h he was appealing against the whole decision which included the decision in the first respondent’s claim and the appellant’s counter-claim. Exhibit “C” he said, was in the earlier case admitted as exhibit “F” and it was canvassed that the loan was secured by the said legal charge over the i appellant’s landed property. It was therefore unnecessary for the trial Judge to hold that the appellant did not appeal against the counter-claim in that there was one judgment dated 28 May, 1991 in both claims. The appellant further j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 95 a submitted that the covenant to repay the loan on mortgage money when due has to be visited by serving notice on the mortgagor hence section 125(1) of the Property and b Conveyancing Law, Volume 5 of the Laws of Bendel State, 1976 was incorporated into the legal charge (Exhibit “C”), clause 10(a) to which both parties were signatories. This was an express provision. The appellant referred also to c paragraph 5 of the first respondent’s amended statement of defence where the first respondent unequivocally admitted that he had knowledge of the pending appeal having received a copy of the notice of appeal and thus he knew of the pending appeal before sale and subsequent transfer of the d appellant’s property. He therefore urged the court to hold that the doctrine of lis pendens applied. On its part first respondent submitted that the doctrine of e lis pendens is aimed at preserving the subject matter of litigation by either of the parties to the said litigation and it applies to tangible and intangible res. He relied on the following authorities – Majekodunmi v Co-Operative Bank Ltd (1997) 10 NWLR (Part 524) 198; Ogundiani v Araba f (1978) 6 – 7 SC 55; Kigo (Nig) Ltd v Holman Bros Nig Ltd (1980) 5 – 7 SC 60 at 73; Okafor v A-G, Anambra State (1988) 2 NWLR (Part 79) 736 at 739; Doma v Ogiri (1997) 1 NWLR (Part 481) 322 at 353. Counsel further submitted g that the doctrine of lis pendens does not apply to every suit. It applies only to a suit in which the object is to recover or assert title to a specific property which must be real property and the doctrine does not apply to personal property. He h relied on the following cases Combined Trade Ltd v ASTB Ltd (1995) 6 NWLR (Part 404) 709 at 717; Barclays Bank of (Nig) Ltd v Ashiru and others (1978) 6 – 7 SC 99 at 128. The question according to the first respondent is whether i there was a pending appeal as at the date of the sale of the appellant’s property by the first respondent against a suit in which the object is to recover or assert title to a specific property (land). To answer the question, first respondent has j submitted that one had to look at the claim contained in the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 96 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) pleadings filed by the parties herein in Suit No. B/1/85 a which was admitted as exhibit “I”. The first respondent’s claim in that suit was for the sum of N161,524.66 being overdraft facilities and bank charges and interest standing b against the current account of the now appellant while the appellant’s counter-claim was for:– “(i) The sum of N38,944.19 as expenses incurred by the defendant as a result of the failure of the plaintiff to complete the hospital building. c (ii) The sum of N310,055.81 as general damages for breach of contract. (iii) The return to the defendant by the plaintiff of the deed of conveyance which the defendant gave to the plaintiff as d security so as to enable the defendant to look for another bank to refund the money given to the defendant and the new bank to complete the building of the hospital.” Thus there were two suits in B/1/85 – the respondents’ suit e and the appellant’s counter-claim being tried together at the end of which the first respondent’s claim succeeded while the counter-claim of the appellant failed and was dismissed. Being dissatisfied, the appellant filed a notice of appeal f dated 22 August, 1991 against the judgment entered in favour of the first respondent while there was no appeal against the decision of the trial court dismissing the counter- claim of the appellant. First respondent contended that it was g erroneous for the appellant to state in his notice of appeal that he was appealing against the whole decision which included the decision in the first respondent’s claim and the appellant’s counter-claim. h The arguments canvassed by the second respondent’s counsel was very much in line with those of the first respondent save to further submit that the doctrine of lis pendens was never intended nor was it made to operate to nullify the sale of property that is the subject of litigation. i He relied on Bua v Dauda (1999) 12 NWLR (Part 629) 59 at 61 where it was stated thus:– “If a third party outside the litigation chooses to purchase a property, subject of litigation from one of the litigants during the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 97 a currency of litigation, he does so at his own risk. If it turns out that the person from whom he bought had no title or was adjudged at the end of the pending action not to be the owner, he takes as he finds. Where the defendant alienates during the pendency of a suit, b the result of the judgment if the plaintiff succeeds will overreach such alienation. If the transferor of the property to the purchaser loses the suit the purchaser loses it too.” As has earlier been stated, the doctrine of lis pendens is c aimed at preserving the subject matter of litigation during the pendency of an action in court. We have this effect. Black’s Law Dictionary (7ed), page 294 refers to lis pendens as a latin expression which when translated into English d simply means “a pending law suit”. It went on to throw more light by stating that it is the jurisdiction power, or control required by a court over property while a legal action is pending. According to the first respondent, the relevant e question is whether there was a pending appeal as at the date of the sale of the appellant’s property by the first respondent to the second respondent against a suit in which the object is to recover or assert title to a specific property which f property is land. What are the bare facts? The first respondent claimed in Suit No. B/1/85 the sum of N161,524.66 being overdraft facilities and bank charges and interest standing against the g account of the appellant. The appellant in the same suit – B/1/85 counter-claimed against the first respondent for:– (i) The sum of N38,944.19 as expenses incurred by the appellant as a result of the failure of the first h respondent to complete the hospital building. (ii) The sum of N310,055.81 as general damages for breach of contract. (iii) The return to the appellant by the first respondent of i the deed of conveyance which he, the appellant, gave to the plaintiff as security so as to enable the appellant to look for another bank to refund the money given to the appellant and the new bank to j complete the building of the hospital.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 98 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Judgment was given in favour of the first respondent on 28 a May, 1991 while the appellant’s counter-claim in the same Suit No. B/1/85 failed and was dismissed. On 2 August, 1991 the appellant who was dissatisfied b with the judgment referred to above filed a notice of appeal, a copy of which was served on the first respondent who admitted service of same in its amended statement of defence dated 5 May, 1997. This admission which is c contained in paragraph 5(a) of the said statement of defence reads as follows:– “It is admitted that the plaintiff, through the solicitor – Surn Akele, Esq., filed a notice of appeal which was CA/B/160/94 in the Court of Appeal in respect of the judgment in Suit No. B/1/85 dated d 28/5/91.” In the notice of appeal it was clearly stated that the appeal was against the whole decision which included not only the first respondent’s claim but the counter-claim of the e appellant. This was the nature of the appeal pending before the Court of Appeal. It is this appeal that was still valid and subsisting in the Court of Appeal until it was dismissed on 19 January, 1995. Earlier on, precisely the 7 October, 1992, f while this appeal was still pending before the Benin Division of the Court of Appeal, the first respondent executed in favour of the second respondent a Deed of Transfer of the appellant’s property contained in exhibit “C” – the legal g charge/mortgage dated 8 August, 1977 after the first respondent had purportedly got the Governor’s assent to sell the property of the appellant which assent was given on 4 April, 1992. As has been stated earlier, the first respondent h categorically admitted in paragraph 5 of its amended statement of defence of its awareness of the pending appeal filed by the appellant against the decision of the trial Judge in Suit No. B/1/85 and it would not have mattered whether or not the appellant brought a formal application for stay of i execution of the lower court’s judgment in Suit No. B/1/85. That argument is merely academic. I shall now proceed to consider the argument put up by the first respondent that the claim of the first respondent j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 99 a against the appellant was to recover money and did not assert title over the property and so the doctrine of lis pendens does not apply. This argument appears unsound to b me because it should be clear from the nature of the transaction between the appellant and the first respondent that the money and the mortgaged property are one and the same and inseparable, the money being demanded by the first respondent in its claim before the court having been c secured by the appellant’s landed property as covered by exhibit “C” the legal charge. Perhaps I should also comment briefly on the case of Bua d v Dauda (supra) relied on by the second respondent in support of the contention that the doctrine of lis pendens was never intended nor was it made to operate to nullify the sale of property that is the subject of litigation The dictum in that e case cited by learned Counsel in the second respondent’s brief and earlier reproduced here is self defeatist when examined a bit more critically. Even the last sentence in that dictum which states as follows:– “If the transferor of the property to the purchaser loses the suit the purchaser loses it f too” is instructive enough. The purchaser of a property that is the subject of litigation should always be prayerful (sic) that the litigation when concluded is in favour of the person he purchased that property from. If the outcome of the g litigation is not in that person’s favour, then the purchaser of the property gets nothing. It is clear from the foregoing therefore that the property in exhibit “C” was sold to the second respondent by the first respondent while litigation h was pending. Issue No. 1 is therefore decided in favour of the appellant against the first and second respondents. Issue No. 2 is as to whether the first defendant/respondent gave notice to the plaintiff/appellant as required by law i before the property contained in exhibit “C” was sold. This issue is distilled from ground 2 of the notice of appeal. The appellant contends that exhibit “L” which is a letter from the appellant’s solicitors BA Alegbe and Co to first respondent j for information about the foreclosure and sale of his

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 100 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) property was received by the first respondent who failed to a reply to it, and that there is nothing in exhibit “E” to show that notice of foreclosure was served on the appellant before sale. The first respondent merely applied for and obtained b the consent of the Governor to sell the property. He submitted that section 125(1) of the Property and Conveyancing Law Cap 129 Laws of Bendel State of Nigeria, 1976 applicable in Edo State requires that a c mortgagee (respondent bank) must give notice to the mortgagor (appellant) requiring payment. This provision of the law, he said, was incorporated into the legal charge (exhibit “C”) thus making it an express provision which ought to have been complied with by the first respondent d being a statutory provision. Section 192 of the same law, he said, mandatorily requires that notice must be in writing and served and that the power of sale shall not be exercised unless and until three months thereafter. He relied on Da e Rocha v Hussain (1958) 3 FSC 89 at 92; (1958) SCNLR 280. He submitted that DW3, Mary Eghobamien, Branch Accountant of the first respondent Bank, Mission Road Branch Benin City admitted that exhibit “L” was received in f their office and the said exhibit “L” was tendered through her. Appellant further contended that even though the first respondent insisted that it gave notice to the appellant before g the sale of his property, the said notice was not produced by the first respondent until the close of the case and it could be inferred that notice before sale of appellant’s property was not given to him. He therefore urged the Court to hold that h no notice of sale was served on the appellant before the property was sold, and so the sale was void. Appellant went on to say that the purported notice referred to in the judgment of the High Court at page 119 of the record is a i letter dated 9 September, 1983 as contained in exhibit “J”. He submitted that this notice is defective in that:– (1) It has not become due and so premature. The legal charge came into existence on the 18 August, 1977 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 101 a and this notice referred to was served about five years later. (2) The notice gave 30 instead of 90 days notice. He b relied on Ewan v ACB Ltd (1986) 1 QLRN 229 ratio 5 at page 230. (3) After service of the said purported notice, the first respondent bank failed to proceed to exercise its c power of sale three months thereafter but resorted to court action in 1985 – three years later to recover the mortgage money. This suit lasted 7 years (1985 – 1991). This is clearly a waiver. He relied on Odu’a d Investment Co. Ltd v Talabi (1997) 10 NWLR (Part 523) 1 at 6 ratio 6, 7 and 8. Counsel submitted that where a mortgagee entitled to the exercise of power of sale waived the default, a fresh notice e is necessary. He relied on Viatonu v Odutayo and another (1950) 19 NLR 119 which relied on the English case of Tommey v White 3 HLC 49. Appellant submitted that in this case now under consideration in this appeal, no fresh notice f was written and served before the first respondent rushed to obtain the Governor’s consent to sell the appellant’s property contained in exhibit “C”. There was neither a notice nor an advertisement by the first respondent bank to g the appellant. The case of Etim v Queen (1964) 1 All NLR 38 at 45 was relied upon. Appellant further submitted that section 19(1) of the Auctioneer’s Act Cap 187 or Auctioneer’s Law Laws of Bendel State, 1976 requires seven day’s notice and advertisement at the principal town h of the district in which the land concerned is situate as advertisement before sale could help to get a better price. He relied on Etim v Queen (supra). This he said was not complied with. Counsel relied on the case of Fojule v i Federal Mortgage Bank of Nigeria and others (2001) 2 NWLR (Part 697) 384 to contend that auctioneer’s notice to sell mortgage property which is less than seven days renders the sale invalid. In the sale under consideration in this appeal j before this Court, there was no notice given to the appellant,

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 102 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) a fact which was admitted by the second respondent under a cross-examination. On its own part, the first respondent submitted that proper notice was given to the appellant before the first respondent b undertook the sale of the mortgaged property. Reference was made to a letter dated 9 September, 1983 which states in part:– “please note that in our resolved determination to recover the sum c outstanding we shall be left with no other alternative that (sic) to take steps to realize the security lodged if we still do not hear from you within the next 30 days.” Counsel submitted that the learned trial Judge accepted this d position as correct and it had not been shown that the findings of the learned Judge was perverse which finding could be interfered with on appeal. Counsel further submitted that the notice was not premature in that the letter e of 9 September, 1983 requiring the appellant to redeem his indebtedness predates Suit No. B/1/85 and appellant’s contention that the said notice is premature is therefore misconceived. f On the appellant’s contention that the purported notice gave 30 days instead of 90 days statutory notice for which the case of Ewan v ACB Ltd (1986) QLRN 229 ratio 5 at 230 was relied upon by the appellant, the first respondent g contended that the form in which a notice is given is not material. What is material is the point of exercising the power of sale. It was contended by the first respondent that although it gave 30 days notice in 1983, it did not exercise h its power of sale until 1992 and it cannot therefore be said that the notice is defective when in actual fact the first respondent did not exercise its power until after 30 days. On the contention that the first respondent failed to sell the property three months after the notice was effected, the first i respondent submitted that a demand notice once given remains in force until the power of sale is exercised. The following cases were relied upon: Okonkwo v CCB (Nig) Plc (1997) 6 NWLR (Part 507) 48; Ojikutu v Agbonmagbe Bank j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 103 a Ltd and others (1966) 2 All NLR 277. It is therefore immaterial whether or not the first respondent proceeded to exercise its power of sale three months thereafter. First b respondent further submitted that the notice contemplated by law is a notice demanding payment of money and not notice of intention to sell mortgaged property. He relied on Bruce v African and Eastern Trade Corp Ltd (1928) 9 NLR 118. First respondent also further contended that Suit No. B/1/85 c itself constituted enough constructive notice upon the appellant to pay his debt. The cases of Bokini v John Holt and Co Ltd (1937) 13 NLR 109 and Allen v John Holt Co Ltd (1935) 12 NLR 13 were relied upon. On the failure of d the first respondent to advertise, first respondent contended that the sale was to be by private treaty and not public auction as stipulated under section 19(1) of the Auctioneer’s Law, Laws of Bendel State, 1976. Even so, a violation of e section 19(1) of the Auctioneer’s Law is only punishable by a fine of N40 and there is no stipulation that the sale be set aside. On the contention that the first respondent did not bargain f for better price as a result of which the property was sold at a give-away price, the first respondent submitted that the obligation imposed by law on the first respondent is that he should act in good faith and to obtain not the best price but a g proper price. The cases of Temco Engineering Co Ltd v Savannah Bank (Nig) Ltd (1995) 5 NWLR (Part 397) 607 and Ihekwoaba v ACB Ltd (1998) 10 NWLR (Part 571) 590 were relied upon. First respondent further contended that h sale of a mortgaged property at an undervalue alone is not enough to vitiate the exercise of a mortgagee’s power of sale. It must be shown that the sale was made at a fraudulent or gross undervalue. It was further submitted that in the instant case, there is no evidence on record to show that i there was collusion between the mortgagee and second respondent or fraud on the part of the first respondent. The first respondent can therefore be taken to have acted in good faith by selling the property for a proper price of N120,000 j pursuant to the valuation report of the first respondent’s

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 104 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

DW2 – Exhibit M which assessed the value of the property a at between N90,000 and N137,000.00. No evidence of fraud or collusion has been led by the appellant, it was further contended, and so the sale is proper. Reliance was placed by b the first respondent on the following cases – Victory Merchant Bank v Pelfaco Ltd (1993) 9 NWLR (Part 317) 340; Union Bank Ltd v Ozigi (1991) 2 NWLR (Part 176) 677. c The second respondent on his part contended that the appellant admitted while being cross-examined that exhibit “E” was tendered through him during the trial in Suit No. B/1/85 and that was why the learned trial Judge had no d hesitation in holding that the appellant was given sufficient notice before the sale of the mortgaged property. Second respondent further submitted that the appellant’s argument that the notice was premature was wrong because at all e times material to the action, the appellant never met up with his obligation to repay the loan given him by the first respondent. He went further to say that clause 9 of exhibit “C” empowered the first respondent, f “at anytime after the day appointed for the repayment of this loan and without any further consent of the borrower to sell the mortgaged property or any part or parts thereof either together or in parcels or either by public auction or by private contract”. g In the light of clause 9, he submitted that notice could only be said to be premature if and only if it was issued before any instalment became due and payable under the loan agreement – exhibit “C”. h It was further contended by the second respondent that the Property and Conveyancing Law does not prescribe 90 days notice, rather it only postpones the mortgagee’s exercise of its power of sale before the expiration of three months from i the date of notice. The rest of the argument of the second respondent followed closely those of the first respondent and it would only merely be repetitive and unhelpful to have to restate them here. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 105 a Exhibit “L” is a letter written by the appellant’s solicitor to the first respondent and because of its importance, I shall reproduce it as is contained on page 130 of the record. It b reads as follows:– “Re: Sale of Property Pledged as Security for Overdraft/ Loan Thank you for your letter ref. NNB/LDC/MB/320/36 of 21 December, 1994 which was a reply to our earlier letter dated 5 December, 1994. To enable us advise our client correctly and c properly, we respectfully require the following particulars/ information that is to say– (a) The precise date the said property was sold. (b) Whether the sale was by public auction or private treaty. d (c) Whether it was advertised before sale and for how long. (d) Whether notice of foreclosure was served on our client before sale. (e) An up to date comprehensive statement of our client’s e account. (f) Whether a deed of conveyance was executed in favour of the purchaser. We do hope you would be good enough to furnish us with the f particulars or information requested in paragraph 2(a) – (f ) above with minimum delay. This will help to bring this matter to a happy mutual termination without resort to litigation. Looking forward keenly to hearing from you. Yours faithfully g BENSON A. ALEGBE ESQ. B.A. ALEGBE and CO.”. This letter, exhibit “L”, was tendered through one Mary Eghobamien, accountant at the Mission Road Branch of the h first respondent bank. Going through the records, it does not appear that the first respondent on receipt of exhibit “L” made a reply to it. Exhibit “E” is a letter from the first respondent to the appellant notifying the appellant of the i sale of his mortgaged property. A combined reading of sections 125(1) and 192(1) of the Property and Conveyancing Law Cap 129 Volume 5 Laws of Bendel State of Nigeria, 1976 applicable in Edo State indicate that a j mortgagee must give notice to a mortgagor of intention to

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 106 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) sell a mortgaged property and that such notice shall be in a writing. Again there is nothing to show from the records that the letter to foreclose was served on the appellant before sale. b First respondent has put up the argument that (1) Suit No. B/1/85 constitutes such good notice; (2) letter dated 9 September, 1983 as contained in exhibit “J” is good notice. c Section 192(1) provides that “Any notice required or authorized to be served or given by this law shall be in writing”. In the interpretation of statutes, it is trite that words must d be given their ordinary meaning. See the following cases:– Fawehinmi v Inspector General of Police (2002) 7 NWLR (Part 767) 606 at 678 paragraphs B – D; African Newspaper v Federal Republic of Nigeria (1985) 2 NWLR e (Part 6) 137; A-G, Abia State v A-G of the Federation (2002) 6 NWLR (Part 763) 264. Applying this principle of law, a (sic) law Suit No. B/1/85 does not constitute such notice. The connotation of the word f “shall” is mandatory. The learned trial Judge could not therefore have been right when he said in his judgment that Suit No. B/1/85 constituted good notice. With respect to letter dated 9 September, 1983, delays attributable to the g first respondent which have already been highlighted in the body of this judgment certainly were enough to constitute a waiver for which a fresh notice became necessary. h Of “waiver”, the Supreme Court in Odua Investment Company Ltd v Talabi (1997) 10 NWLR (Part 523) 1 said it is the intentional and voluntary surrender or relinquishment of a known privilege and/or right which implies a dispensation or abandonment by the party waiving, of a right i or privilege which at his option he could have insisted upon. See also Ariori v Elemo (1983) 1 SCNLR 1. There was no notice to the appellant. All the other arguments that flow from this are of mere academic interest since the paramount j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 107 a consideration is the issue of notice. I shall and do resolve issue No. 2 in favour of the appellant. Issue No. 3 is as to whether the learned trial Judge was b right in holding that the valuation report (exhibit “K”) has no weight and evidential value since the maker of the document could not give evidence. This issue is distilled from ground 3 of the notice of appeal and it deals with the c production of the valuation report – exhibit “K” which has to do with expert evidence. The appellant’s position here is that the learned trial Judge was wrong to have held that in as much as the qualification and experience of the maker of d exhibit “K” were unknown, no credence, weight or probative value would be attached to it. The appellant submitted that exhibit “K” whose maker is dead, was admitted by consent of the three Counsel in the case as it e forms part of the agreed facts of the case requiring no further proof. Reliance was placed on section 75 of the Evidence Act Cap. 112 Laws of the Federation of Nigeria, 1990. Appellant further submitted that admissibility of a piece of evidence is based on relevance and not on weight to be f attached to it. Reliance was placed on Muhammed v Kayode (1997) 11 NWLR (Part 530) 584. For admissibility of documentary evidence reliance was g placed on section 19 of the Evidence Act Cap. 112 Laws of the Federation of Nigeria, 1990 and the case of Inland Containers Ltd v RCT Co (Nig) Ltd (1997) 8 NWLR (Part 517) 505 at 507. The role of weight to be attached is stated in section 92(1) and (2) of the Evidence Act. The appellant h went on to submit that the law is settled that a court is expected in all proceedings to admit and act only on evidence which is admissible in law. Exhibit “K” not being inadvertently admitted, the Court has a duty to act on it. i Reliance was placed on Alade v Olukade (1976) 2 SC 183 187. Counsel went on to say that the Supreme Court has in the case of Etim and others v Ekpe and another (1983) 3 SC 12 at 37-38 set out three documents which are inadmissible j notwithstanding the consent of the parties to their

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 108 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) admissibility. Appellant went on to say that DW2 averred a that the maker of exhibit “K”, though late, was an estate surveyor and valuer and that his evidence is relevant to this case and was admitted as expert evidence. b First respondent has submitted that though exhibit “K” has been admitted by consent of the contending parties, there is a distinction between admissibility and the ascription of probative value to the piece of evidence. Akibu c v Oduntan (1992) 2 NWLR (Part 222) at 210; A-G, Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255; Ayeni v Dada (1978) 3 SC 35 at 61 were relied upon. It was contended for the first respondent that exhibit d “K” being the valuation report of an expert, the expert must be called as a witness and he is expected to state his qualification, experience and reasons for his opinion and he should be cross-examined with a view to discrediting him as e an expert. Shell Petroleum Development Co v Isaiah (1997) 6 NWLR (Part 508) 236 at 249 was relied upon. The first respondent went further to say that the evidence of an expert will amount to hearsay where such expert merely gives his opinion on a report and is not called as a witness and cross- f examined. In that circumstance, the learned Judge was right in not ascribing any value to exhibit “K”. Shell Petroleum Development Co of Nig Ltd v Otoko (1990) 6 NWLR (Part 159) 693; Wambai v Kano NA (1965) NMLR 15 at 17 were g relied upon. The second respondent on his part submitted that section 75 of the Evidence Act Cap 112 Laws of the Federation of h Nigeria, 1990 cited and relied upon by the appellant is inapplicable to the present situation and that even where situations are covered by the provisions of section 75 of the Evidence Act, the Court is empowered to require the fact admitted to be proved otherwise than by admission. He i placed reliance on the proviso to section 75 of the Evidence Act. It would be unduly repetitive to reproduce the rest of the submission of Counsel as they are adoptive of the reasoning by the first respondent. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA Ezomo v New Nigeria Bank Plc 109 a In Etim and others v Ekpe and another (1983) 3 SC 12 at page 36; (1983) 1 SCNLR 120, the Supreme Court observed thus:– b “It is a cardinal rule of evidence and of practice in civil as well as criminal cases that an objection to the admissibility of a document sought by a party to be put in evidence is taken when the document is offered in evidence. Barring some exceptions where by law certain documents are rendered inadmissible (consent or no c consent of the Parties notwithstanding) for failing to satisfy some conditions or to meet certain criteria, the rule still remains inviolate that where objection has not been raised by the opposing party to the reception of evidence of a document or other evidence, d see Chukwura Akunne v Matthia Ekwume (1952) WACA 59, the document will be admitted in evidence and the opposing party cannot be heard to complain about its admission. See Alade v Olukade (1976) 2 SC 183 at 188 – 189; R v Hammond [1941] 3 All ER 318; R v Patel [1951] 2 All ER 29. e Such exceptions would among others include:– (i) Unregistered instrument required by law to be registered. See Abdallah Jamal v Namih Saidi and Another (1933) 11 NLR 86; Elkali and Another v Fawaz (1940) 6 WACA 212; f Idowu Alase and others v Olori- Ilu and others (1965) NMLR 66. (ii) Unsigned deed of grant or copy thereof. Abdul Hamada Ojo v Primate Adejobi and others (1978) 3 SC 65. g (iii) Unstamped instrument or document requiring to be stamped unless it may legally be stamped after execution and the duties and penalities are paid. See Routledge v Mc Kay [1954] 1 All ER 855 at 856; 1 WLR 615 at 617.” h In the present case on appeal, exhibit “K” does not fall into any of these exceptions and by consent of all the contending Counsel for the parties, it has been admitted. It has sailed through and been admitted because there is no doubt that it i is relevant. Having been thus admitted, the lower court was bound to act on it. That the maker’s qualification and experience were not given and therefore no weight and no evidential value should be ascribed to the said exhibit “K” j does not represent the true position of the law. To shove

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Alagoa JCA 110 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) aside exhibit “K” without taking a close and critical look at a it to determine how much weight to ascribe to it was wrong, moreso, as it was brought to the court’s attention that its maker is late. A document once admitted should speak for b itself. The assertion by DW2 that he was a member of their profession long before him and that the land in dispute in exhibit “K” and exhibit “M” relate to the same land has not been denied by the respondent. The learned trial Judge was c therefore wrong not to have placed any probative value on exhibit “K”. I shall and do therefore resolve issue No. 3 also in favour of the appellant. In all, the appeal succeeds and is allowed. The judgment of Idahosa J of the Benin High Court in Suit No. B/345/95 dated 26 May, 1999 is accordingly set d aside. The appellant’s claims as per the third amended statement of claim filed on 14 April, 1997 are hereby upheld. There shall be N5,000 costs against each of the first and second respondents and in favour of the appellant e

BULKACHUWA JCA: I have had the privilege of reading in draft the judgment read by my learned brother, Alagoa JCA. I agree with his reasoning and conclusion. I too find merit in f the appeal. I, accordingly, allow it and adopt the consequential order therein including orders as to costs. g ADEREMI JCA: I have been privileged with a preview of the judgment just delivered by my learned brother, Alagoa JCA. I agree with his reasoning and conclusion that the appeal is, in law, meritorious. h I seek an indulgence here to add a few words of my own if only for the purpose of amplifying some points of law arising for determination in this appeal. The appellant did raise a crucial point of law in the issues formulated for i determination by this court among other issues; it is whether the property, the subject-matter of this appeal, described in exhibit “C” tendered was sold during the pendency of the appeal. This issue is factual and the answer to it must be j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Ezomo v New Nigeria Bank Plc 111 a derived from the record of proceedings. By their pleadings, it is common ground that the first respondent as the plaintiff in Suit No. B/1/85 had taken out a writ of summons against b one Dr SE Ezomo (now deceased) and substituted by Vera Ezomo – the present appellant by an order of court in 2001, the first respondent, as plaintiff in that case got judgment against the defendant, now the appellant for the sum of c N161,524.66 plus 13% interest arising from the overdraft loan granted him. Suffice it to say that the judgment was delivered on 28 May, 1991 and being dissatisfied with same, the present plaintiff/appellant who was the defendant in that suit appealed against the said judgment on 22 August, 1991. d Thereafter, the plaintiff in that suit now the defendant/ respondent in the present appeal took some necessary legal steps with a view to sell the said property. The official consent to sell the said property was granted to the present e respondent on 10 April, 1992. It is further commonly agreed by the parties that while this appeal was pending the property was sold on 7 October, 1992, suffice it to say that the appeal was dismissed by the Court of Appeal on 19 f January, 1995. It is therefore beyond any argument that the property was sold during the pedency of the appeal. The doctrine of lis pendens as enshrined in the first issue for determination is g therefore germane for consideration here. The first respondent here and as the plaintiff/respondent in the appeal that was dismissed had averred in their pleadings that the appellant here who was also the appellant in the appeal that h was dismissed did not file a motion for staying of execution of the judgment that inured in its favour thus contending that it had no legal inhibition to realize the fruit of its judgment by selling the aforementioned property. As said, the present i appellant had pleaded the doctrine of lis pendens. What does this doctrine connote? Generally, the doctrine of lis pendens prevents the effective transfer of rights in any property, which is the subject matter of an action pending in a court j during the pendency in court of the action.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 112 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Let it be noted that in its application against any purchaser a of such property, the doctrine is not founded on the equitable doctrine of notice – actual or constructive – but upon the fact that the law does not allow to litigating parties or give to b them, during the currency of the litigation involving any property rights in such property, that is the property in dispute, so as to prejudice any of the litigating parties. Undoubtedly, the clearest exposition of the doctrine is the c one made by Turner LJ In Bellamy v Sabine (1857) 26 LJ (NS) Equity Reports 797 when at page 803 he reasoned:– “The doctrine of lis pendens is not, as I conceive, founded upon any of the peculiar tenets of a court of equity as to implied or d constructive notice. It is, as I think, a doctrine common to the courts both of law and equity, and rests, as I apprehend, upon this foundation that it would plainly be impossible that any action or suit could be brought to a successful termination if alienations e pendente lite were permitted to prevail. The plaintiff would be liable in every case to be defeated by the defendant alienating before the judgment or decree, and would be driven to commence his proceedings de novo, subject again to be f defeated by the same course of proceeding. That this doctrine belongs to a court of law no less than courts of equity appears from a passage in 2 Inst. 375, where Lord Coke, referring to an alienation by a mesne lord pending a writ, says that the alienee could not take advantage of a particular provision in the statute of g Westminster 2nd because he came to the mesnalty pendente brevi, and in judgment of law the mesne (as to the plaintiff) remains seised of the mesnalty, for pendente lite nihil innovetur; and though Lord Bacon’s Orders, which give the rule in equity, are very generally expressed – the language of the order upon this h subject being ‘no decree bindeth any that cometh in bonafide by conveyance from the defendant before the bill exhibited and is made to no party, neither by bill nor order but where he comes in pendente lite and while the suit is in full prosecution (and this i includes while the suit is under appeal) and without any colour of allowance or privity of the court, there regularly the decree bindeth’ – this order must, I think, be understood to mean that the decree binds so far as the title of the plaintiff is concerned.” (Italics mine for emphasis.) j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Ezomo v New Nigeria Bank Plc 113 a The above dictum was cited with approval by the Supreme Court in Barclays Bank of Nig Ltd v Ashiru and others (1978) 6 – 7 SC 99. It has also been held that a person b who purchased a property pendente lite, though without actual notice and for valuable consideration, cannot, in law, sustain his purchase; the locus classicus is the case of Sorrel v Carpenter (1728) 2 P Wms 482 where it was observed c that:– “A purchase pendente lite though without actual notice and for valuable consideration yet shall be set aside but as it is hard enough in some cases to make people take notice of a decree, it is harder still to oblige them to take notice of a pendency of a suit d and in case of a real purchase pendente lite, the plaintiff is to be held to strict proof. And if any flaw at the hearing be on the plaintiff’s side, the court will not let him amend, but if the purchase pendente lite be fraudulent and to elude the justice of the e court, it ought to be highly discountenanced.” The above dictum was quoted with approval by the Supreme Court in Ogundiani v Araba and another (1978) 6 – 7 SC 55. Perhaps, I should further, add, based on the decision in f Doma and others v Ogiri and others (1997) 1 NWLR (Part 481) 322, the principle enshrined in the doctrine of lis pendens applies to both tangible and intangible res as regards both the right to property and right to a declaration. g See also Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR (Part 524) 198. Let me now apply the doctrine of lis pendens to the settled facts of this case as I have set them out supra. At the risk of h being repetitive, the settled facts that have emerged in this case are as follows:– (1) The property, subject-matter of this appeal, was sold by the first respondent to the second respondent on 7 i October, 1992. (2) The appeal against the judgment that was executed was filed on 22 August, 1991. j (3) The said appeal was dismissed on 19 January, 1995.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 114 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Thus, the sale of the property took place during the a pendency of the appeal. The doctrine of lis pendens therefore prevents the effective transfer of the legal estate in the property by the first respondent to the second b respondent. Suffice it to say that the second respondent cannot, in law, sustain the purported transfer of the legal interest in the property to him. c It is for this little contribution, but most especially for the detailed reasoning contained in the lead judgment of my learned brother, Alagoa JCA, that I shall also allow the appeal. Reliefs 1, 2 and 3 claimed are consequently granted. d As to relief No. 4 relating to damages for trespass, I abide by the order made in the lead judgment. With regards to relief No. 5, I bear in mind that the appeal which was pending whilst the sale was carried out has since be dismissed, also e there is no evidence that the sum adjudged in favour of the first respondent against the appellant has been paid, I also bear in mind that the said property still remains under mortgage, it will therefore be inequitable and unjust to grant f relief No. 5 which is hereby dismissed. Subject to what I have said supra, I abide by all the consequential orders made in the lead judgment including the order as to costs. g Appeal allowed.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Associated Discount House Ltd. v Amalgamated Trustees Ltd. 115 a Associated Discount House Ltd v Amalgamated Trustees Ltd b SUPREME COURT OF NIGERIA KUTIGI, KATSINA-ALU, PATS-ACHOLONU, AKINTAN, MUKHTAR JJSC Date of Judgment: 5 MAY, 2006 Suit No.: SC. 289/2002 c Banking – Bank – Definition of Discount house – Whether a bank Word and phrases – Bank d Facts The dispute that led the appellant to commence the present case, originally at the Federal High Court, Lagos, arose over e its effort to recover a N120 million loan granted to the respondent and for which the property at 24A, Campbell Street, Lagos was given as security. The respondent filed a motion objecting to the jurisdiction of the Federal High f Court. The objection was upheld by the Federal High Court and the case was transferred to the Lagos High Court. At the Lagos High Court, the respondent again objected to the jurisdiction of the Lagos High Court. The objection was g overruled. An appeal against that ruling to the Court of Appeal was allowed. The present appeal is against the decision of the Court of Appeal allowing the appeal. The main issue in controversy is which of the two h jurisdictions to entertain the claim. The resolution of this question would involve interpretation of the provisions of section 251(1)(d) of the 1999 Constitution which provides thus:– i “251 (1) Notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other j court in civil causes and matters . . .

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

116 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(d) Connected with or pertaining to banking, banks, a other financial institutions, including any action between one bank and another, any action by or against the Central Bank of Nigeria arising from banking, foreign exchange, coinage, legal tender, b bills of exchange, letters of credit, promissory notes and other fiscal measures. Providing that this paragraph shall not apply to any dispute between an individual customer and his bank in respect of c transactions between the individual customer and the bank.”

Held – 1. Although discount houses are not per se banks, they d come within the definition of “other financial institutions” defined in section 66 of the Banks and Other Financial Institutions Act. They are required in section 58(2) of that Act to be licensed by the Central Bank of Nigeria like the banks and they are also e subjected to the same controls as the other banks under section 30(2) of the said Act. 2. The word “bank is not defined in the Constitution and in the Interpretation Act. It is therefore appropriate to f ascribe its ordinary grammatical meaning which is, according to Ogundare JSC in Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333 at 361 as: “an organisation or place that provides g financial services”. 3. The plaintiff’s claim in the instant case is a dispute over money lent to a customer by a financial house. It is therefore not one coming within those specified in h section 251(1)(d) of the 1999 Constitution over which the Federal High Court has exclusive jurisdiction. On the other hand, it comes within those excluded from the jurisdiction of the Federal High Court in the i proviso to subsection 251(1)(d) of the Constitution. The Court of Appeal was therefore in error when it held that the Federal High Court had jurisdiction in the matter. Appeal allowed. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Associated Discount House Ltd. v Amalgamated Trustees Ltd. 117 a Cases referred to in the judgment Nigerian Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR b (Part 591) 333 Oloba v Akereja (1988) 3 NWLR (Part 84) 508 Onuorah v Kaduna Refining and Petrochemical Co. Ltd c (2005) 6 NWLR (Part 921) 393 Orthopaedic Hospital Management Board v Garba (2002) 14 NWLR (Part 788) 538 Tukur v Govt of Gongola State (1989) 4 NWLR (Part 117) d 517 Foreign United States v Shipp (208) US 563, 51 L.ed. 319, 27 SC e 165, 8 Ann Cas 265 (1906) United States v United Mine Workers of America USSCR 91 L. ed. 884 f Nigerian statutes referred to in the judgment Banks and Other Financial Institution Decree No. 25 of 1991, sections 58(2), 66 g Constitution of the Federal Republic of Nigeria 1999, section 251(1)(d) Federal High Court Act, section 22(2) h Counsel For the appellant: Ajayi Babalakin, SAN (with him Akoni, Adebayo) For the respondent: Turnershaw (Miss) i Judgment PATS-ACHOLONU JSC: (Delivering the lead judgment) This appeal arose from an action filed by the appellant against the j respondent. The parties had entered into an agreement

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 118 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) whereby the appellant advanced by way of a commercial a paper facility the sum of N120m to the respondent company for 90 days only subject to an interest payable on the commercial paper. The facility was completely drawn. The b security for the facility was a house, property of the respondent situate at 24A Campbell Street, Lagos and the parties covenanted that the documents shall be deposited with the appellant. At the expiration of 90 days, the money c so invested was not paid back and worse still, the respondent caused the sum to be rolled over without the express consent or permission of the appellant. When the appellant made several demands for the repayment of the facility and the interest due, and the respondent refused or failed to pay, the d appellant was forced to institute an action in the Federal High Court. The respondent raised a preliminary objection on the ground that the Federal High Court has no jurisdiction to entertain the case. The objection succeeded e and the Federal High Court transferred the case to the Lagos High Court pursuant to section 22(2) of the Federal High Court Act which now became seised of the case. When the Lagos State High Court now seised of the matter proceeded f with the case the respondent once again raised a preliminary objection on the ground that the Lagos High Court cannot entertain the action as it lacks the requisite jurisdiction. This objection was refused, and dismissed. Piqued by the ruling g of the High Court, the respondent filed a notice of appeal. The Court of Appeal allowed the appeal and held that the Lagos High Court lacked the jurisdiction to adjudicate on the matter. The appellant as a losing party in the Court of Appeal appealed to this Court and framed three issues for h determination which are as follows:– 1. Did the Court of Appeal have jurisdiction to overrule the decision of the Lagos High Court dated 12/1/01, and consequently hold that it is the Federal High i Court that is vested with exclusive jurisdiction to entertain the appellant’s claim in this action against the respondent, whereas the second or latter of the two reasons or ratio which the Lagos High Court j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Associated Discount House Ltd. v Amalgamated Trustees Ltd. 119 a relied upon in support of its said decision was not appealed against by the respondent, and the Court of Appeal too did not consider, reverse or overturn the b second reason or ratio relied upon in the overturned decision of the Lagos High Court? 2. Does the appellant qualify to be described as a bank within the meaning of section 251(1)(d) of the 1999 c Constitution in the manner that would vest the Lagos High Court with jurisdiction to entertain the appellant’s claim against the respondent in this action as was held by the Lagos High Court decision of d 12/1/01? 3. Is it right in law, as was held in the judgment of the Court of Appeal delivered on 16/9/02, that the Lagos State High Court does not have the power under e section 22(3) of the Federal High Court Act, to transfer a matter in which the Lagos State High Court lacks jurisdiction to the Federal High Court for hearing and determination? f The respondent contrariwise formulated only two issues which are follows:– (i) Whether the Court of Appeal was correct when it held that the High Court of Lagos State does not g have jurisdiction to entertain the suit of the appellant. (ii) Whether the Court of Appeal was correct when it held that the High Court of Lagos State does not have the power to transfer a matter in respect of h which it lacks jurisdiction to the Federal High Court. Now the Court of Appeal in resolving the matter before it which resulted in allowing the appeal and striking out the i action, held as follows:– “The main plank of the respondent’s resistance to the appeal brought before us by the appellant was that it did banking business and that in line with the decision in FMBN v NDIC (Supra), it should be acknowledged as a bank. With respect to respondent’s j Counsel, I think his contention is unsustainable. All that the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 120 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

respondent needed to show pursuant to Section 2 of BOFID was a the licence given it to operate as a bank. It would be wrong to assume that because the respondent did banking business, it was a bank even if it was not so registered under BOFID. The argument of respondent’s Counsel overlooks the fact that whereas in FMBN b v NDIC (Supra), the law setting up Federal Mortgage Bank and the functions assigned to it makes it abundantly clear that it was set up to operate as a bank. the (sic) respondent in this case can be seen as no more than a financial institution under Section 57 of c BOFID. This conclusion flows from the fact that the respondent itself pleaded in paragraph 1 of its statement of claim that it was duly licensed to carry on business as a discount house.” The lower court concluded the judgment which it delivered this way:– d “Once it is determined that the respondent is not a bank within the meaning of Section 251(1)(d) of the 1999 Constitution the question whether or not the appellant was an individual customer of the respondent within the meaning of Section 251(1)(d) e becomes a moot point and therefore inconsequential.” What was behind the decision of the Court of Appeal to take a contrary view to that of the lower court is the definition or rather the interpretation the court of first instance ascribed to f the status of the appellant. The learned trial Judge had held as follows:– “The Supreme Court described a bank in Federal Mortgage Bank v NDIC (1999) 2 NWLR (Part 591) 333 as follows: ‘The word g bank is not defined in the Constitution as in the Interpretation Act. However in the ordinary grammatical meaning, it means an organization that provides financial services’. Surprisingly the syllogism drawn by the High Court from this is ‘It is not in dispute that a discount house is an organization that provides financial h service. It is not in dispute that a discount house is an organization or place that renders financial services. Accordingly, can it then be subsumed as well to that extent that a discount house is a bank of some sort. I think it is logical and reasonable to do so. A perusal of relevant legislation will also lend credence to my view that a i discount house being a financial institution can safely be called a bank’.” The deduction drawn by the court of first instance is not only strange but traduced all norms known in the financial j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Associated Discount House Ltd. v Amalgamated Trustees Ltd. 121 a world as we are by this conclusion being told to ascribe to companies dealing as brokers or stock and shares and other securities as banks. Such description would be offensive in b the financial world and do violence to what a bank or a financial institution is in our law. A financial institution can never be a bank. To me this is a case of a simple loan facility granted to a c “person” which as described in the statement of claim is a mere company and is neither a bank nor a financial institution. The appellant which is a discount house granted a facility to the corporate body, that is the respondent d intending that after the expiration of 90 days, it would get its principal and accrued interest from the respondent. Unfortunately nothing of that happened as the parties in the court seemed mired in the miasma of insidious and patently unnecessary polemics of jurisdiction of the court leaving e aside all the issues in respect of the simple agreement they both entered. The transaction that gave rise to the dispute was a simple contract which the parties readily understood what it was all about. There is something seemingly obscene f and unethical in this case. It is instructive that the respondent before it filed the preliminary objection in the two courts seised of the matter at one time or the other (sic). did not file an pleadings (sic). The respondent did not provide the High g Court with the opportunity to see or read its pleadings so as to have a proper bird’s eye view of the real issues in controversy. Therefore this Court has not been enabled to know what in the financial world or in law the respondent h can be described as. It therefore boils down to the case of a mere customer which is a financial institution and a body that accepts loans from individuals to do business. The respondent more or less strove to convert the court to vaudeville of legal playhouse by using or relying and i embarking on all sorts of subtleties and merry-go-round proceedings to circumvent the real issue before the High Court which is as to whether or not the appellant’s money is locked up in the respondent’s company. The legal j gymnastics employed by the respondent to have a roller

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 122 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) coast ride and its seeking to use the processes of the court to a put the appellant in the woods though ingenious it may appear, is to my mind both unethical, (sic) inconsiderate as it failed to respond to the appellant’s case or attend to the b matter in issue. If the appellant cannot sue in the Federal High Court and at the same time cannot equally sue in the Lagos High Court, (sic) which court would the action be then commenced. It is a case of “such welcome and c unwelcome news at once. It is too hard to reconcile” (Shakespeare in Macbeth). There comes a time in the difficult but challenging art or science of adjudication and administration of justice when a d court is faced with consideration of pure justice, and of course abstract law that seeks to shroud itself in concepts, dreariness and the theory of law. It is then that a court should dig deep into its reservoir of knowledge of its e forensic arsenal borne out of experience and mete out justice that can easily be understood and appreciated by the common man in the street and the litigants. The courts are the products of the society. They are established to solve and f give remedies to people who complain of having been shortchanged or wronged somehow. Therefore, it should not allow undue technicalities likely to wreak havoc in the other party’s case to be introduced in an otherwise situations that do not admit of cloudiness or woolliness. g The learned Counsel for the appellant has urged this Court to hold that the Lagos High Court had acted properly when it considered the intention or fiscal policy of section 251(1)(d) h of the Constitution in determining whether or not that court has the jurisdiction to entertain the appellant’s claim. The consideration by the Lagos High Court in respect of the fiscal policy referred to in this case is to my mind, way off the mark. It is of no relevance here. Another point canvassed i is that even if the High Court does not have the jurisdiction to adjudicate on the matter it necessarily should have the ability to cause a transfer of a case to be made from its court and that a court that has no jurisdiction to entertain a case j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Associated Discount House Ltd. v Amalgamated Trustees Ltd. 123 a can make an order of transfer The Supreme Court of the United States referring to the case of United States v Shipp (208) US 563, 51 L.ed. 319, 27 SC 165, 8 Ann Cas 265 b (1906) in United States v United Mine Workers of America USSCR 91 L. ed. 884 at 911, said as follows:– “The purport of the judgment of the court here is that court which on its face value may not have jurisdiction could still make a c preservative order to keep the res. In other words it can make an order transferring a matter of which constitutionally it is not vested with powers to adjudicate upon.” Let us examine the issue as to whether the High Court here d can make an order of transfer of a case before it when it has no jurisdiction to entertain the main case. In the case of Oloba v Akereja (1988) 3 NWLR (Part 84) 508 this Court held thus at 520:– e “The issue of jurisdiction is very fundamental as it goes to the competence of the court or tribunal. If a Court or Tribunal is not competent to entertain a matter or claim or suit, it is a waste of valuable time for the court to embark on the hearing and determination of the suit, matter or claim.” f In other words, it will be fortuitous for such a court to make an order of transfer. In this case the respondent used the issue of jurisdiction or competence of the court to literally run riot, and seeks to obfuscate the real issue in controversy g by resorting to inanities. It is the duty of this Court of justice to remove the chaff from the wheat. The resort to the use of the procedures of the court to bamboozle the court or truncate the claim of the appellant is not noble. I can h only say that the method being adopted by the respondent appears in my view to be a red herring to obscure the facts in issue. The lower court had said that there is no law empowering i the State High Court to transfer a case to the Federal High Court. With greatest respect I beg to disagree. Section 22(3) of the Federal High Court Act states as follows:– “Notwithstanding anything to the contrary in an law, no cause or j matter shall be struck out by the High Court of a State or of the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 124 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Federal Capital Territory, Abuja on the ground that such cause or a matter was taken in the High Court instead of the Court and the Judge before whom such cause or matter is brought may cause such cause or matter to be transferred to the appropriate Judicial Division of the court in accordance with such rules of court as may b be in force in that High Court or made under any enactment or law empowering the making of rules of court generally which enactment or law shall by virtue of this subsection be deemed also to include power to make rules of court for the purpose of this c subsection.” The tenor and intendment of this subsection is that the State High Court can validly make an order of a transfer of a case from itself to a court of different jurisdiction. The wording d of this subsection is suffused with alliterations, use of cryptic words which concealed and veiled the meaning intended thereby making it seemingly difficult to decipher. I would here refer to what Thomas Jefferson said of boundless e tautology in the wording of statutes generally: “Statutes which from their verbosity, their endless tautologies, their involutions of case within parenthesis, and their multiplied efforts at certainty by saids, aforesaids, by or and, and to make f them more plain, do really render them incomprehensible not only to common readers but to the lawyers themselves.” (Courtesy of Thomas Jefferson Autobiography (1982) by Paul L. Ford.) The dictates of the principle or the doctrine of Golden Rule g in statutory interpretation imposes on the court the duty to give a construction that seeks to liberate and expound the horizon of the law to make it a living law that would cater for the future. I believe that where a provision in a statute is liable to be construed either in the positive or in the negative h form or connotation, then it is definitely more beneficial to adopt the interpretation that is more in tune with the public weal and benefit. In appropriate cases it is my view that the High Court can make an order of transfer of a case but that i is not relevant in the case here. This is a simple contract between a financial institution and a legal person that took a loan. Therefore the Lagos High Court can exercise jurisdiction. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC Associated Discount House Ltd. v Amalgamated Trustees Ltd. 125 a In my view, the parties must go back squarely to the Lagos State High Court where the respondent should file its pleadings and respond to what is contained in the appellants b claim. I allow the appeal, set aside the judgment of the court below and affirm the ruling of the High Court. There shall be costs to the appellant assessed in this Court at N10,000 and the Court of Appeal for N5,000. c KUTIGI JSC: I have had the privilege of reading in advance the judgment just delivered by my learned brother Pats- Acholonu JSC. I agree with him to allow the appeal, set aside the judgment of the Court of Appeal and restore the d ruling of the Lagos High Court which has jurisdiction over the matter in dispute. I endorse the order for costs.

KATSINA-ALU JSC: I have had the advantage of reading in e draft the judgment delivered by my learned brother Pats- Acholonu JSC in this appeal. I agree entirely with his reasoning and conclusion. There is nothing I can usefully add. f AKINTAN JSC: The dispute that led the appellant to commence the present case, originally at the Federal High Court, Lagos, arose over its effort to recover a N120 million loan granted to the respondent and for which the property at g 24A Campbell Street, Lagos was given as security. The respondent filed a motion objecting to the jurisdiction of the Federal High Court. The objection was upheld by the Federal High Court and the case was transferred to the h Lagos High Court. At the Lagos High Court, the respondent again objected to the jurisdiction of the Lagos High Court. The objection was overruled. An appeal against that ruling to the Court of Appeal was allowed. The present appeal is i against the decision of the Court of Appeal allowing the appeal. The main issue in controversy is which of the two courts have jurisdiction to entertain the claim. The resolution of j this question would involve the interpretation of the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Akintan JSC 126 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) provisions of section 251(1)(d) of the 1999 Constitution a which provides thus:– “251 (1) Notwithstanding anything to the contrary contained in this Constitution and in addition to such other b jurisdiction as may be conferred upon it by an Act of the National Assembly, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other court in civil causes and matters . . . c (d) Connected with or pertaining to banking, banks, other financial institutions, including any action between one bank and another, any action by or against the Central Bank of Nigeria arising from banking, foreign exchange, coinage, legal tender, d bills of exchange, letters of credit, promissory notes and other fiscal measures. Providing that this paragraph shall not apply to any dispute between an individual customer and his bank in respect of e transactions between the individual customer and the bank.” The law is settled that jurisdiction of a court is determined by the plaintiff’s claim before the court – see Onuorah v Kaduna Refining and Petrochemical Co Ltd (2005) 6 f NWLR (Part 921) 393; Tukur v Government of Gongola State (1989) 4 NWLR (Part 117) 517 and Orthopaedic Hospital Management Board v Garba (2004) 14 NWLR (Part 788) 538. g In the instant case, the plaintiffs claim before the Court is for recovery of the N120 million advanced or lent by the appellant to the respondent. It is therefore a case that falls h within that of a dispute between an individual customer of a bank or discount house and his bank or discount house. Although discount houses are not per se banks, but they come within the definition of “other financial institutions” defined in section 66 of the Banks and Other Financial i Institutions Act. They are required in section 58(2) of that Act to be licensed by the Central Bank of Nigeria like the banks and they are also subjected to the same controls as the other banks under section 30(2) or the said Act. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Akintan JSC Associated Discount House Ltd. v Amalgamated Trustees Ltd. 127 a The word “bank” is not defined in the Constitution and in the Interpretation Act. It is therefore appropriate to ascribe its ordinary grammatical meaning which is according to b Ogundare, JSC in Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333 at 361 as “an organisation or place that provides financial services”. As I have stated earlier above, the plaintiff’s claim in the instant c case is a dispute over money lent to a customer by a financial house. It is therefore not one coming within those specified in section 251(1)(d) of the 1999 Constitution over which the Federal High Court has exclusive jurisdiction. On the other hand, it comes within those excluded from the d jurisdiction of the Federal High Court in the proviso to subsection 251(1)(d) of the Constitution. The Court of Appeal was therefore in error when it held that the Federal High Court had jurisdiction in the matter. See: Federal e Mortgage Bank of Nigeria v NDIC (supra). I had the privilege of reading the draft of the leading judgment written by my learned brother, Pats-Acholonu JSC which has just been delivered. For the above reasons, and f the fuller reasons given in the said leading judgment I also allow the appeal and hold that the trial of the case should proceed at the High Court of Lagos. I also abide by the other consequential orders made in the leading judgment, g including that on costs.

MUKHTAR JSC: I have had the preview of the judgment of my learned brother Pats-Acholonu JSC. I am in full h agreement that this is a simple contract between the parties, which the Lagos High Court has jurisdiction to hear. I agree with the reasoning and conclusion reached and also allow the appeal. I abide by the orders made in the lead judgment. i Appeal allowed.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

128 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

a Lamboyo Ltd v New Nigeria Bank Plc

COURT OF APPEAL, BENIN DIVISION b ADEREMI, ALAGOA, SHOREMI JJCA Date of Judgment: 9 MAY, 2006 Suit No.: CA/B/316/99

Banking – Banker/customer relationship – Essence of c Facts This is an appeal against the decision of the Igarra Division of the Edo State High Court delivered on 25 April, 1996 in Suit No. HIG/23/92. d By a writ of summons the plaintiff claimed as follows:– (a) The sum of USD87,000,00 (eighty-seven thousand US Dollars) being the proceeds of the plaintiff’s e export cocoa beans to London during the 1989/90 cocoa season which the defendant has refused and or neglected to pay to the plaintiff despite demand. (b) 25% interest on the said sum from March, 1990 until f date of judgment and 6% interest thereafter until payment. Pleadings were filed and exchanged after several amendments. g The appellant called one witness and the respondent also called one witness and several exhibits were also tendered and admitted. Facts not disputed are that one Chief Momodu Ukanah operated two accounts with respondent. The h accounts were in the names of Ologbonyo and Sons Account No. 6017 and Lamboyo Limited Account No. 6213 (Lamboyo Limited is herein referred to as the appellant). The said Chief Momodu Ukanah was operating the two i accounts as the sole signatory. In the 1989/90 cocoa season the said Chief Ukanah approached the respondent for a loan to process cocoa exportation in the name of Ologbonyo and Sons but because of a directive from the Export Promotion j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Lamboyo Limited v New Nigeria Bank Plc 129 a Commission only a limited liability company could export cocoa hence the appellant was floated and a sum N1,000 was used to open its accounts at the respondent bank. This b account lasted for only 14 days. The cocoa business was financed with a loan in the name of Ologbonyo Account No. 6017, while the appellant was used to export the cocoa beans. c The said Chief Momodu Ukanah who is now deceased was informed of the proceeds of sale by means of credit advice and the Naira equivalent was paid into Account No. 6017 and the loan was deducted. It is after the death of the d said Chief Ukanah that the appellant instituted this suit to recover the sum of US $87,000. The trial Judge in a considered judgment given on 25/4/96 dismissed the claim of the plaintiff. e Dissatisfied with the judgment the plaintiff appealed to this Court.

Held – f The essence of the contract of banker and customer is the bank’s right to use the money for its own purposes and its undertaking to repay an amount equal to that paid in with or without interest, either at call or at a fixed time depending g on the nature of the agreement entered into by the parties. Appeal dismissed. h Cases referred to in the judgment Nigerian ACB Ltd v Adebesin and Co Ltd (1999) 1 NWLR (Part 585) i Adejuwon v Co-operative Bank Ltd (1992) 3 NWLR (Part 228) 251 Allied Bank Nig Ltd v Akubueze (1997) 6 NWLR (Part 509) 374 j Aminashanu v UCH (1996) 10 NWLR (Part 476) 65

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

130 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Brifina Ltd v Inter-Cont Bank Ltd (2003) 5 NWLR (Part a 814) 540 British and French Bank Ltd v Opaleye (1962) 1 SCNLR 60 Ceekay Traders Ltd v General Motors Ltd (1992) 2 NWLR b (Part 222) 132 Dan-Jumbo v Dan-Jumbo (1999) 11 NWLR (Part 627) 445 Ezuku v Ukachukwu (2004) 46 WRN 1 c Kalu v Odili (1992) 5 NWLR (Part 240) 130 NDIC v SBN Plc (2003) 1 NWLR (Part 801) 311 Nkado v Biano (1997) 5 NWLR (Part 503) 31 d Nweko v FRN (2003) 4 NWLR (Part 809) 1 Obijaku v NDIC (2002) 8 NWLR (Part 774) 201 Ochin v Ekpechi (2000) 5 NWLR (Part 656) 225 e Odejide v RTGLM (2004) 38 WRN 61 Odife v Aniemeka (1992) 7 NWLR (Part 251) 25 Ogba v Onwuzo (2005) 14 NWLR (Part 945) 334 f Onjewu v KSMCI (2003) 1) NWLR (Part 827) 40 Stirling Civil Eng Nig Ltd v Yahaya (2002) 2 NWLR (Part 750) 1 Woluchem v Gudi (2004) 3 WRN 20 g

Counsel For the appellant: Salawu For the respondent: Eghobamuen (with him Imeh) h

Judgment ADEREMI JCA: (Delivering the lead judgment) The appeal here is against the decision of the High Court of Justice, Edo i State, Igarra Division in Suit No. HIG/27/92, Lamboyo Ltd v New Nigeria Bank Plc delivered on 25 April, 1996. The plaintiff (hereinafter referred to as the appellant) had by paragraph 12 of its statement of claim dated 18 November, j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Lamboyo Limited v New Nigeria Bank Plc 131 a 1992 sought against the defendant (hereinafter referred to as the respondent) the following relief:– “1. The sum of US $87,000.00 (Eighty Seven Thousand United b States Dollars) being the proceeds of the plaintiff’s export of cocoa beans to London during the 1989/1990 cocoa season which the defendant has refused and/or neglected to pay to the plaintiff despite repeated demands. 2. 25% interest on the said US$87,000.00 (and the interest c should be paid in United States Dollars) from March, 1990 when the proceeds were received by the International Division of the defendant/Company until date of judgment and 6% interest on the judgment sum until date of payment.” d Pleadings, in terms of statement of claim, amended statement of defence with the leave of Court and amended reply with the leave of court were filed and exchanged between the parties. Thereafter, the case proceeded to trial at e the end of which the addresses of the Counsel were taken by the learned trial Judge. In a considered judgment delivered on 25 April, 1996, the learned trial Judge dismissed the suit in toto. In so doing, the learned trial Judge had reasoned f thus:– “On the evidence before me I prefer the defendant’s case to that of the plaintiff. I do not believe the evidence of the PW1 when he said that it is Lamboyo Limited that exported the cocoa. g Lamboyo Limited was used as a cover-up in the export of the cocoa. The PW1 stated in evidence that he took no loan from the defendant. He is therefore not a party to the loan granted by the defendant to Ologbonyo and Sons. He has no say in the matter. I am unable to find the source of the finance for the purchase of h the cocoa for export by Lamboyo Limited . . . Chief Ukana applied for banking facilities and the defendant granted it to him and he used it to finance his cocoa export. Lamboyo Limited did not come into it. The Lamboyo Account No. i 6213 was in my view, opened by Chief Ukana to put wool over the eyes of the Nigerian Export Promotion Council. PW1 failed to show the existence of any contract between the plaintiff and the defendant on the basis on which this action is founded. PW1 also failed to show the source of money with which j Lamboyo financed the purchase of cocoa in the 1989/90 cocoa

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 132 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

season. The PWI lied when he said that the N1,000 with which the a Lamboyo Account No. 6213 was opened was given to him by his friend. I believe and accept the evidence of DW1 when he said:– ‘I know the company called Ologbonyo & Sons. It was opened b by Late Chief Alhaji Mamodu Ukana. The No. of the account is 6017. He had another account in the name of Lamboyo Limited. The Account No. is 6213. The Late Chief Momodu Ukana was the sole signatory to an account it means that he is the only one who can authorize any transaction on the c account’. The PW1 has not the remotest connection with either Ologboyo & Sons or Lamboyo Limited other than that both were owned by his late father, Chief Ukana. d It is in evidence before me that Ologbonyo & Sons utilized the overdraft facility granted to Chief Ukana as its sole proprietor in the purchase of cocoa for export in the 1989/ 90 cocoa season. From the several circumstances of this case and the totality of the e evidence adduced before me, I have no difficulty in coming to the conclusion that the plaintiff has woefully failed to prove his case on the balance of probabilities. On 18/1/90 when Exhibit D was purportedly signed by Lamboyo Limited the Account No. 6213 belonging to Lamboyo Limited was f in the red. In other words, it did not exist any longer as an account. On 8/2/90 when Exhibit D was received and stamped by the Nigerian Custom, Apapa, it is doubtful whether Lamboyo Limited was in fact incorporated as a limited liability company. . . g I am satisfied on the preponderance of the evidence adduced before me, in this case that the defendant is right in paying the Naira equivalent of the proceeds of the cocoa export of USD87,000.00 into the account of Ologbonyo & Sons No. 6017 to which the defendant granted banking facilities for the purchase of h the cocoa in the 1989/90 cocoa season. I therefore hold that the defendant is not indebted to the plaintiff.” Being dissatisfied with the said judgment, the plaintiff/ appellant filed a notice of appeal dated 19 July, 1996 which i notice carries one ground of appeal. By the leave of court granted on 10 July, 2002, the appellant filed four additional grounds. Both sides later exchanged briefs of arguments after filing same, appellant’s brief was filed on 29 July, 2002 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Lamboyo Limited v New Nigeria Bank Plc 133 a and with the leave of court, its reply brief was filed on 1 February, 2005. With the leave of court, the respondent filed its brief on 30 March, 2004. b When this matter came before us on 24 April, 2006, Mr Salawu, learned Counsel for the appellant adopted and relied on the aforesaid briefs of his client and urged us to allow the appeal. Mr Eghobarnien, learned Counsel for the respondent c also adopted and relied on his client’s brief and urged us to dismiss the appeal. Distilled for determination by this Court and as set out in the appellant’s brief of argument are two issues which are in d the following terms:– 1. Whether from the totality of the evidence adduced, the learned trial Judge was right to dismiss the appellant’s case. e 2. Whether the learned trial Judge was right in holding that Lamboyo Ltd and Ologbonyo & Sons Enterprises are one and same Companies. f For its part, the respondent has incorporated a preliminary objection in the body of his brief challenging the competency of ground 2 of the additional grounds of appeal. With regards to the appeal proper the respondent has identified only one issue for determination, which as g contained in its brief is as follows:– “Having regard to the totality of the evidence adduced before the learned trial Judge and the circumstances of this case, whether the learned trial Judge was right in dismissing the appellant’s case.” h I shall start the consideration of this appeal with the preliminary objection raised in the respondent’s brief of argument wherein it was contended that ground two of the additional grounds of appeal is a fresh issue not canvassed i before the court below, and the appellant not having sought the leave of this Court to raise it cannot predicate any argument on it and that ground ought to be struck out, a number of judicial authorities the likes of (1) Obijaku v j NDIC (2002) 8 NWLR (Part 774) 201; (2) NDIC v SBN Plc

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 134 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(2003) 1 NWLR (Part 801) 311 and (3) Stirling Civil Eng a Nig Ltd v Yahaya (2002) 2 NWLR (Part 750) 1 were relied upon. And since according to the respondent, ground 2 is incompetent, issue No. 2 founded upon it should accordingly b be struck out relying on the authorities of Brifina Ltd v Inter- Cont Bank Ltd (2003) 5 NWLR (Part 814) 540 and (2) Dan- Jumbo v Dan-Jumbo (1999) 11 NWLR (Part 627) 445. In the exercise of its appellate jurisdiction, a court of c appeal must not go outside the issues properly raised before the court from which the appeal is coming to it, if any of the parties to the appeal wishes to raise a point which was never raised before the court below, he must first seek and obtain d the leave of the appellate court. See: NDIC v SBN Plc (2003) 1 NWLR (Part 801) 311. Failure to seek and obtain the leave of court, invariably, the Appellate Court invited to determine the fresh issue not so raised earlier in the court below, is e fatal to the consideration of such an issue by the Appellate Court. See: Ogba v Onwuzo (2005) 14 NWLR (Part 945) 334. This principle of procedural law does not admit of any modification. Now, what is the ground complained of? It is f in the following terms:– “GROUND TWO– The learned trial Judge erred in law when he failed to hold that Lamboyo Limited Company is a Limited Liability Company, g separate legal entity from Ologbonyo & Sons Enterprises it promoter and/or Directors. PARTICULARS 1. Lamboyo Limited is a distinct and separate corporate entity h from Ologbonyo and Sons Enterprises. 2. Lamboyo Limited is a distinct and separate corporate entity from its promoters and/or directors.” An issue No. 2 distilled from the aforesaid ground 2, at this i risk of repetition, reads:– “Whether the learned trial Judge was right in holding that Lamboyo Ltd and Ologbonyo & Sons enterprises are one and same Companies.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Lamboyo Limited v New Nigeria Bank Plc 135 a A very careful reading of issue No. 2 set out supra shows clearly that it is incongruous to ground two also set out supra. Giving the wordings of ground 2 their ordinary b meaning, it conveys to discerning mind that the learned trial Judge did not hold in the course of his judgment, that Lamboyo Limited Company is a separate and distinct entity from Ologbonyo & Sons enterprises, its promoters and c directors. Indeed, the particulars set out under that ground reinforce the construction I have given those wordings, for by them (the particulars) the appellant is asserting the two are different and distinct entities. But issue No. 2 d purportedly distilled from the ground 2, when carefully read, leaves no one in doubt that the appellant is saying no more than that the trial Judge held that the two are separate and distinct entities; and that it is now querying whether that purported or imagined finding of the trial Judge was right. e The two in my view are quite different. The law remains static that an issue raised for determination in an appeal must relate to the ground of appeal in the Notice of Appeal, when it does not, that issue must be struck out. See: (1) f Ceekay Traders Ltd v General Motors Ltd (1992) 2 NWLR (Part 222) 132; (2) Kalu v Odili (1992) 5 NWLR (Part 240) 130; (3) Odife v Aniemeka (1992) 7 NWLR (Part 251) 25 and (4) Onjewu v KSMCI (2003) 1) NWLR (Part 827) g 40. Following the dictates of these authorities I hereby strike out issue No. 2 raised by the appellant. A fortiori, a ground of appeal, which is lacking in coverage by an issue or issues for determination, is deemed to be abandoned. See: h (1) Nkado v Biano (1997) 5 NWLR (Part 503) 31; (2) Aminashanu v UCH (1996) 10 NWLR (Part 476) 65 and (3) Ochin v Ekpechi (2000) 5 NWLR (Part 656) 225. Again, going by the demand of these authorities, I hereby i strike out issue No. 2. In effect, the preliminary objection is sustained. Issue No. 1 in the appellant’s brief of argument is materially similar to the only issue raised by the respondent. j I shall therefore take them together.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 136 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

In arguing this ground, the appellant in its brief has a contended that payment of the proceeds of cocoa beans was made by a London-based customer who had bought the cocoa for export and later shipped it to New York. b According to it, the payment was made to the respondent/bank on behalf of the appellant/Company and the money was not credited to its (appellant) Account No. 6213 being operated by the respondent. It was conceded in its c argument that the evidence led by both parties, which according to it was correct, is to the effect that the application for loan from the defendant/bank–respondent was made by Ologbonyo & Sons, but the appellant did not apply for any loan from the respondent for the purchase of d cocoa. By not crediting its (appellant) account with the proceeds of the cocoa and crediting Ologbonyo and Son’s account the respondent/bank had breached the contractual bank/customer relationship between them, there is no e evidence that the Late Chief Momodu Ukana or PW1 ever authorized the defendant/respondent to use the proceeds from the export to off-set the indebtedness of Ologbonyo & Sons, it was further contended. The respondent on the f other hand referred to the findings of the trial Judge where he rejected, in toto, the evidence of PW1, and the evidence of DW1 remaining unchallenged was rightly believed by the trial Judge, the finding of the trial Judge that Ologbonyo g & Sons, utilised the overdraft facility granted to Chief Ukana as its sole proprietor in the purchase of cocoa for export in the 1989/90 cocoa season, while urging that the appeal be dismissed, the appellant had urged us to allow the appeal. h I hasten to say that the essence of the contract of banker and customer is the bank’s right to use the money for its own purposes and its undertaking to repay an amount equal to that paid in with or without interest, either at call or at a i fixed time depending on the nature of the agreement entered into by the parties. The facts of this case as even supported by the evidence is that Late Chief Ukana, the father of PWI Lamidi Ologbonyo was the owner of a company by name j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Lamboyo Limited v New Nigeria Bank Plc 137 a (sic) Ologbonyo & Sons as well as we styled (sic) OMOR NIGERIA LTD, the deceased (Chief Ukana was the sole proprietor of Ologbonyo and Son’s whose account with the b defendant/respondent-bank is No. 6017 and the sole signatory to it. In the 1989/90 cocoa season, the deceased applied for banking facilities to the defendant to enable him to finance the purchase of cocoa for export. Exhibit “C” a letter dated 2 November, 1989 is the application. The loan c was granted, it is also common ground between the parties that only a limited liability companies were permitted at that time to export produce, hence the deceased incorporated Lamboyo Limited to enable him proceed with the business d of cocoa export. In his testimony, Lamidi Ologbonyo the only witness called by the plaintiff/appellant said and I quote:– “My farmer’s names are Chief Mamodu Ukanah. My father is now e late. I know a company called Ologbonyo & Sons. My father owned that Company. My father was also the chairman of the both Company (sic). My father was the sole signatory to the account of Ologbonyo and Sons with the defendant’s company. My father was the sole signatory of the plaintiff’s Company. I was not a f signatory to the account of the plaintiff company . . . It is true that during the 1989/90 cocoa season, I cashed various cheques for my father. The money was for my father’s use . . . The plaintiff/Company had no money in its account during the g 1989/90 Cocoa Season.” The only witness called by the defendant/respondent is Mr JO Odiase the bank manager of the bank in his evidence said:– h “I know the company called Ologbonyo and Sons. It was owned by late Alhaji Momodu Ukanah. The number of the account is 6017. He had another account in the name of another Company Lamboyo Limited. The account is 6213. The late Alhaji Momodu i Ukana was the sole signatory. If a person is the sole signatory to an account it means that he is the only one who can authorize all transaction on the account . . . The account for Lamboyo Ltd was opened with a Cheque for N1,000.00 drawn on Ologbonyo and Son’s Account No. 6017. The j only other transaction on this account was the later withdrawal of

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 138 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

the N1,000.00 with which the account was opened and thereafter a the account became nil . . . The account was never operated. There was no money in the account and so it could not have financed the buying of cocoa. The b export of cocoa by Lamboyo Ltd was financed through the Account of Ologbonyo and Son’s No. 6017. The cocoa purchased was exported through Lamboyo Ltd (sic) The Chairman of Lamboyo Ltd was Late Chief Momodu Ukanah. The Lamboyo Ltd was used to export the cocoa in order to satisfy the requirement of c the Nigerian Export Promotion Council that only a Limited liability company must export produce. The late Chief was aware of this requirement. . . . The Naira equivalent of the proceeds was credited to his Account No. 6017. It was credited to Account No. 6017 because the loan for financing the export of cocoa was d granted to the Chief on that account.” The evidence of DW1 was never discredited nor even challenged. As I have said earlier, the judge who saw and heard the witnesses disbelieved the only witness called by e the plaintiff/appellant. Can I say in the light of the pieces of evidence led by the parties, the salient parts of which I have reproduced above say (sic) that the trial Judge was wrong in his findings? My answer undoubtedly, is in the negative. f The findings of the learned trial Judge are a thorough and proper evaluation of the evidence led before him. I must always bear in mind that it is not the business of a court of g appeal to substitute its own view of the facts for those of the trial Judge who had the singular opportunity of seeing and hearing the witnesses, but if the trial Judge has failed to make proper use of the singular opportunity he had of seeing and hearing these witnesses, or he is shown to have drawn h wrong inferences from uncontroverted or indisputable facts which are not supported by the evidence, then a Court of Appeal, must in the interest of justice, exercise its own powers of reviewing those facts and draw appropriate i inferences therefrom. That situation has not occurred in the instant matter. Consequently, I answer issue 1 in the appellant’s brief and the only issue in the respondent’s brief in the affirmative. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Lamboyo Limited v New Nigeria Bank Plc 139 a In concluding, it is my judgment that this appeal is unmeritorious. It must be dismissed and it is accordingly dismissed. The judgment of the court below is hereby b affirmed. The respondent is entitled to the cost of this appeal, which I assess in its favour but against the appellant at N5,000.

ALAGOA JCA: I have had the advantage of reading before c now the lead judgment of my brother Pius Olayiwola Aderemi JCA just delivered and I agree that the appeal lacks merit and should be dismissed. I also accordingly dismiss it and abide by the orders therein contained including order on d costs.

SHOREMI JCA: I have had the opportunity of reading in advance the lead judgment delivered by my brother. I am in e full agreement with the reasons and conclusions reached but would like to add by way of emphasis. This is an appeal against the decision of the Igarra Division of the Edo State High Court delivered on 25 April, f 1996 in Suit No. HIG/23/92. By a writ of summons the plaintiff claimed as follows:– (a) The sum of USD87,000,00 (Eighty-Seven Thousand g US Dollars) being the proceeds of the plaintiff’s export cocoa beans to London during the 1989/90 Cocoa season which the defendant has refused and or neglected to pay to the plaintiff despite demand. h (b) 25% interests on the said sum from March, 1990 until date of judgment and 6% interest thereafter until payment. Pleadings were filed and exchanged after several i amendments. The appellant called one witness and the respondent also called one witness and several exhibits were also tendered and admitted. Facts not disputed are that one Chief Momodu j Ukanah operated two accounts with respondent. The

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Shoremi JCA 140 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) accounts are in the names of Ologbonyo & Sons Account a No. 6017 and Lamboyo Limited Account No. 6213 (Lamboyo Limited is herein referred to as the appellant). The said Chief Momodu Ukanah was operating the two b accounts as the sole signatory. In the 1989/90 cocoa season the said Chief Ukanah approached the respondent for a loan to process cocoa exportation in the name of Ologbonyo and Sons but because of a directive from the Export Promotion c Commission only a limited liability company could export cocoa, hence the appellant was floated and a sum of N1,000 was used to open its accounts at the respondent bank. This account lasted for only 14 days. d The cocoa business was financed with a loan in the name of Ologbonyo Account No. 6017, while the appellant was used to export the cocoa beans. e The said Chief Momodu Ukanah who is now deceased was informed of the proceeds of sale by means of credit advice and the Naira equivalent was paid into Account No. 6017 and the loan was deducted. It is after the death of the f said Chief Ukanah that the appellant instituted this suit to recover the sum of US87,000. The trial Judge in a considered judgment given on 25/4/96 dismissed the claim of the plaintiff. g Dissatisfied with the judgment the plaintiff appealed to this Court. The appellant was granted leave to file amended notice of h appeal with four grounds of appeal. Briefs were exchanged and the appeal was heard on 24/4/06. The appellant distilled two issues for determination as i follows:– (1) Whether from the totality of the evidence adduced the learned trial Judge was right to dismiss the appellant’s case. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Shoremi JCA Lamboyo Limited v New Nigeria Bank Plc 141 a (2) Whether the learned trial Judge was right in holding that Lamboyo Limited and Ologbonyo & Sons Enterprises are one and the same companies. b The respondent formulated one issue for determination as follows:– “Having regard to the totality of the evidence adduced before the learned trial Judge and the circumstances of this case whether the c learned trial Judge was right in dismissing the appellant’s case.” I agree that Issue No. 2 as raised by the appellant is incompetent I also strike it out for reasons given in the leading judgment. d I cannot see any difference of this formulated issue and issue 1 as it is formulated by the appellant. The appellant argued that the trial Judge was wrong when he held that the Respondent was right to have credited the e Account No. 6017 of Ologbonyo & Sons with the proceeds of the export instead of appellant’s account No. 6213. It is argued that the respondent has no defence in law. The appellant relied on several authorities including:– f Adejuwon v Co-Operative Bank Ltd (1992) 3 NWLR (Part 228) 251; ACB Ltd v Adebesin and Co Ltd (1999) 1 NWLR (Part 583) 13; Allied Bank Nig Ltd v Akubueze (1997) 6 NWLR (Part 509) 374 at 398; and British and French Bank g Ltd v Opaleye (1962) 1 SCNLR 60 at 60. All on the principle that :– “If a banker agrees with his customer to open two accounts, he has not without the consent of the customer any right to move either h assets or liabilities from one account to the other.” The respondent argued further that so long as there is evidence from which the trial court could come to the conclusion to which it did the verdict can not be disturbed. i See: Nweko v FRN (2003) 4 NWLR (Part 809) 1 at 30-31. The learned trial Judge considered the whole evidence before him and arrived at a conclusion as follows:– “I am satisfied on the preponderance of evidence adduced before j me in this case that the defendant is right in paying the Naira

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Shoremi JCA 142 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

equivalent of the proceeds of the cocoa export of USD87,000.00 a into the account of Ologbonyo and Sons No. 6017 to which the defendant granted banking facilities for the purchase of the cocoa in the 1989/90 cocoa season. I hold therefore that the defendant is not indebted to the plaintiff. Therefore the action fails and the b plaintiff’s claim shall be and it is hereby dismissed.” The trial Judge in my view has evaluated the evidence before him and it is the rule that an Appellate Court should not substitute its own views for views of trial court who (sic) c evaluated and appraised facts. Ezuku v Ukachukwu (2004) 46 WRN 1; Woluchem v Gudi (2004) 3 WRN 20; and d Odejide v RTGLM (2004) 38 WRN 61. To accede to the request of the appellant that:– (a) It has been proved that it is the plaintiff/appellant and not any one else that purchased and exported the e cocoa for 1989/90 season and Ologbonyo and Sons and Olamboyo Ltd are two different and separate entity from the circumstance of this case is to substitute our own views. f All the authorities cited by the appellant are not applicable to the facts of this case and therefore this case should be treated on its own merit. g The belief of the trial Judge that Chief Ukanah the sole signatory to the account authorised and gave his consent to the payment into Ologbonyo account not be faulted. For the detailed reasons advanced by my learned brother h Aderemi JCA, I agree with the conclusions. The appeal lacks merits and I also dismiss it. I also abide by the consequential orders made in the lead judgment. Dismissing the appeal.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION)

ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 143 a ACB Plc v Nwanna Trading Stores (Nig) Ltd b COURT OF APPEAL, ABUJA DIVISION ADEKEYE, ODILI, RHODES-VIVOUR JJCA Date of Judgment: 11 MAY, 2006 Suit No.: CA/A/189/2003

Banking – Banker/customer relationship – Dispute in c relation to recovery of loan – What to consider

Facts The appellant, African Continental Bank Plc as plaintiff in d Suit No. NHS/MIN/169/95 had a banker and customer relationship with the respondent Uwanna Trading Stores (Nig) Ltd at its branch office in Minna Niger State. The respondent maintained a current account No. 20027 with the e appellant at this branch – whereupon an overdraft facility to the tune of N200,000 was approved by the appellant. The respondent defaulted in the maintenance of the account and was indebted to the bank to the tune of N1 19,711.90k (one f hundred and nineteen thousand, seven hundred and eleven Naira, Ninety Kobo). By an application for issuance of a writ of summons on the undefended list, the appellant, as plaintiff commenced a debt recovery suit. In view of the g pleadings later filed, the case was removed to the general cause list. The amount reflected on the appellant’s writ of summons was N199,711.90 as at 31/5/95. Interest thereon at 21 % per annum until judgment and 10% per annum until judgment debt is fully paid. The claim was predicated on a h sum of N200,000 granted and allegedly fully drawn by the defendant/respondent. Respondent filed a counter-claim. During the course of trial before the lower court, the appellant examined and cross-examined one witness. The i trial court struck out the case of the appellant for lack of diligent prosecution following an application to that effect by the respondents counsel. The respondent led evidence on the counter-claim, parties submitted written addresses. In a j considered judgment delivered on 2/9/97, the lower court,

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION)

144 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) dismissed the appellant’s Suit No. 17/3/97, and gave a judgment to the respondent on the counter claim. Dissatisfied with the decision of the court, the appellant appealed to the Court of Appeal. b Held – Where there is a dispute between a bank and its customer in relation to recovery of loan advanced by the banker to c customer the questions the court should normally consider are:– (1) Was the defendant granted a loan by the plaintiff; (2) If so how much; d (3) What was the interest agreed; (4) How much if any has the defendant paid out of the loan. e Appeal dismissed.

Cases referred to in the judgment Nigerian f Adeniran v Ashabi (2004) 2 NWLR (Part 857) 375 Adeosun v Jibesin (2001) 11 NWLR (Part 724) 290 Adigun v A-G, Oyo State (1987) 1 NWLR (Part 53) 678 g A-G, Edo and Delta States v Jessica Trading Co (1999) 5 NWLR (Part 604) 500 Akinkugbe v Bucknor (2004) 11 NWLR (Part 885) 652 h Animashaun v Olojo (1990) 6 NWLR (Part 154) 111 Anueyiagu v Deputy Sheriff, Kano (1962) 1 All NLR (Part 2) 52 Anueyiagu v Deputy Sheriff, Kano (1962) 1 All NLR 940 i Apena v Aiyetobi (1989) 1 NWLR (Part 95) 85 Bank of the North v Yau (2001) 10 NWLR (Part 721) 408 Barclays Bank DCO v Hassan (1961) 4 All NLR 836 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION)

ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 145 a BON v NBCI (1990) 5 NWLR (Part 150) 263 Dagazau v Borkir International Ltd (1999) 7 NWLR (Part 610) 293 b Dahiru v Kamale (2001) 11 NWLR (Part 723) 224; (2001) FWLR (Part 62) 1855 Ebba v Ogodo (1984) 1 SCNLR 372 c Egbe v Adefarasin (No.1) (1985) 1 NWLR (Part 3) 549 Ekong v Udo (2002) 16 NWLR (Part 792) 1 FBN Plc v Obeya (1998) 2 NWLR (Part 537) 205 d Gbafe v Gbafe (1996) 6 NWLR (Part 455) 417 Jack v Whyte (2001) 6 NWLR (Part 709) 266 Juwo v Shehu (1992) 8 NWLR (Part 258) 129 Kabiru Bayero v Federal Mortgage Bank (Nig) Ltd and e others (1998) 2 NWLR (Part 538) 509 Kassim v Hermann Ebert (Trading as Cash Stores) (1966) 1 All NLR 55; (1966) NMLR 123 f Kuti v Balogun (1978) 1 SC 53 Kyari v Alkali (2001) 11 NWLR (Part 724) 412 Mobil Oil (Nig) Plc v IAL 36 Inc (2000) 6 NWLR (Part 659) 146 g Mogaji v Odofin (1978) 4 SC 91 Mutual Aid Society Ltd v FH Ogonade NNLR 18 NAB Ltd v Felly Keme (Nig) Ltd (1995) 4 NWLR (Part 387) h 100 Nigerite (Nig) Ltd v Dalami (Nig) Ltd (1992) 7 NWLR (Part 253) 288 i Nnamdi Azikiwe University v Nwafor (1999) 1 NWLR (Part 585) 116 Nwankwo v Abazie (2003) 12 NWLR (Part 834) 381 Obiefuna v Okoye (1961) 1 SCNLR 144; (1961) All NLR j 357

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION)

146 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 a Odje v Ovien (1992) 7 NWLR (Part 253) 309 Odubeko v Fowler (1993) 7 NWLR (Part 308) 637 b Oduwole v LSDPC (2004) 9 NWLR (Part 878) 382 Ogannagbe v Giwa (1969) 2 All NLR 35 Ogele v Nuhu (1997) 10 NWLR (Part 523) 109 c Ogolo v Fubara (2003) 11 NWLR (Part 831) 231 Okafor v Okafor (2000) 11 NWLR (Part 677) 21; (2000) FWLR (Part 1) 17 Olafisoye v FRN (2004) 4 NWLR (Part 864) 580 d Olusanya v Olusanya (1983) 1 SCNLR 134 Omo v Amantu (1993) 3 NWLR (Part 280) 187 Oseni v Oniyide (1999) 13 NWLR (Part 634) 258 e Oshodi v Eyiwunmi (2000) 13 NWLR (Part 684) 298 Oviasu v Oviasu (1973) 11 SC 315 Oyewole v Oyekola (1999) 7 NWLR (Part 612) 560 f Peenok Investments Ltd v Hotel Presidential Ltd (1982) 12 SC 1 Salami v Oke (1987) 4 NWLR (Part 63) 1 Saleh v Monguno (2003) 1 NWLR (Part 801) 221 g Seriki v Are (1999) 3 NWLR (Part 595) 469 SGB (Nig) Ltd v Aina (1999) 9 NWLR (Part 619) 414 Shugaba v UBN Plc (1999) 11 NWLR (Part 627) 459 h Sodipo v Lemminkainen and others OY (1986) 1 NWLR (Part 15) 220; (1986) All NLR 78 South Eastern Newspaper Corporation v Anwara (1975) 9 – i 11 SC Thanni v Saibu (1977) 2 SC 89 Tsokwa Motors (Nig) Ltd v Awoniyi (1999) 1 NWLR (Part 586) 199 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION)

ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 147 a UAC v Owoade 13 WACA 207 UBN Ltd v Fajebe Foods (1994) 5 NWLR (Part 344) 325 Umar v Onwudine (2002) 10 NWLR (Part 774) 129 b Victoria Anisiuba v Anthony Emodi (1975) ECSLR 355 Woluchem v Gudi (1981) 5 SC 291 Woluchem v Wokoma (1974) All NLR 543; (1974) 3 SC c 153; (1974) 3 SC 153 Nigerian statutes referred to in the judgment Constitution of the Federal Republic of Nigeria, 1979 d (amended by Decree No. 107 of 1993), sections 33(1) and 251(4) Constitution of the Federal Republic of Nigeria, 1999, sections 36(3) and 36(4) e Sheriff and Civil Process Act Cap 407 Laws of Federation of Nigeria, 1990, Order 1 rule 5 Sheriff and Civil Process Law Cap 123 of the Revised Laws f of Niger State, 1989, sections 46 47 Nigerian rules of court referred to in the judgment Niger State High Court (Civil Procedure) Rules, 1987 Order g 36, Order 40 rule 1

Counsel For the appellant: Chukwuma-Wachukwu Ume (with him h Njaka) For the respondent: Isiyaku

Judgment i ADEKEYE JCA: (Delivering the lead judgment) The appeals CA/A/113/2001 and CA/A/189/2003 emanated from the Suit No. NSAC/MIN/169/95 at the High Court of Justice Niger State, Minna Judicial Division. The appeal j CA/A/113/2001 is against the judgment delivered on 2/9/97.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 148 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

While the Appeal No. CA/A/189/2003 is against the a ruling delivered on 12 May, 2003. Both appeals were consolidated by an order of this Court made on 6 April, 2005. The two appeals are offshoots of the same suit b between the same parties and in respect of the judgment in the suit and the execution of the judgment thereafter respectively.

Facts c In the appeal CA/A/113/2001 the appellant African Continental Bank Plc, as plaintiff in Suit No. NHS/ MIN/169/95 had a banker and customer relationship with d the respondent Uwanna Trading Stores (Nig) Ltd at its branch office in Minna Niger State. The respondent maintained a current account No. 20027 with the appellant at (his branch whereupon it was approved an overdraft facility to the tune of N200,000 by the appellant. The e respondent defaulted to (sic) the maintenance of the account and was indebted to the bank to the tune of N1 19,711.90k (one hundred and nineteen thousand, seven hundred and eleven Naira, ninety Kobo). By an application for issuance f of a writ of summons on the undefended list, the appellant, as plaintiff commenced a debt recovery suit. In view of the pleadings later filed, the case was removed to the general cause list. The amount reflected on the appellant’s writ of g summons was N199,711.90 as at 31/5/95. Interests thereon at 21% per annum until judgment and 10% per annum until judgment debt is fully paid. The claim was predicated on a sum of N200,000 granted allegedly fully drawn by the h defendant/respondent. Respondent filed a counter-claim. During the course of trial before the lower court, the appellant examined and cross-examined one witness. The trial court struck out the case of the appellant for lack of diligent prosecution following an application to that effect i by the respondent’s Counsel. The respondent led evidence on the counter-claim, parties submitted written addresses. In a considered judgment delivered on 2/9/97, the lower court dismissed the appellant’s Suit No. 17/3/97, and gave j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 149 a judgment to the respondent on the counter-claim. Dissatisfied with the decision of the court, the appellant appealed to this Court. Records were settled and briefs of b argument exchanged in accordance with the Rules of the Court of Appeal, 2002. At the hearing of this appeal the appellant adopted and relied on the appellant’s brief deemed filed on 21/5/02 and the appellant’s reply brief filed on 11/4/05. Six issues for determination were distilled from the c six grounds of appeal filed as follows:– (1) Was the trial court right to, on 2/9/97 suo motu dismiss appellant’s suit which suit same court had on d 17/3/97 struck off and which has not been relisted, thus no longer before the court and without asking parties to address it on it? (2) The counter-claimant having on her affidavit evidence e admitted committing banking fraud against the appellant, was trial court right to have still heard the counter-claim, and institution of justice to further the counter-claimant’s base action? f (3) The appellant’s PW1 having given copious, credible and convincing evidence capable of sustaining the appellant’s suit, was the trial court right to on 17/3/97 strike out the appellant’s case instead of closing her g case and asking defendant to open her defence. (4) Whereas appellant has filed both reply and written address to the counter-claim was the court right to assume that the counter-claim was undefended and h thereby entered default judgment against the appellant. (5) Was there any cause of action and even evidence to support the judgment given in respect of the counter- i claim? (6) Whereas the appellant/judgment debtor still has movable assets worth over N651,360 in Niger State, was the trial court proper to allow the attachment and j sale of the appellant’s banking premises without first

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 150 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

attaching the movable property as well as comply a with the statutory conditions. The respondent raised an objection in respect of grounds 2 and 6 of the grounds of appeal. Two issues for determination b were distilled from the remaining four grounds as follows:– (1) Whether in the circumstances of this case the striking out and later dismissal of the plaintiff’s case by the trial court were improper and resulted in miscarriage c of justice. (2) Whether the defendant proved its counter-claim. Before I consider the objection raised to grounds two and six d of the appellant’s grounds of appeal, I am duty bound to remark on the shoddy and inelegant brief of the appellant. I regard the brief as verbose and devoid of clarity. A brief is an important medium in the determination of an appeal e particularly in doing substantial justice between the parties. Hence a good brief shall be brief, precise, clear and intelligible, as it is meant to assist the Justices in the delicate task of decision making. It is impossible for the Court to f make out a case for the parties on the record of appeal. Counsel must be reminded that bad briefs complicate and slow down the pace of the work of Appellate Courts. Unfortunately, however bad, inelegant or prolix a brief may be, it still has to be considered in the interest of justice. g Akinkugbe v Bucknor (2004) 11 NWLR (Part 885) 652; Olafisoye v FRN (2004) 4 NWLR (Part 864) 580; Adeniran v Ashabi (2004) 2 NWLR (Part 857) 375. h The respondent objected to grounds two and six of the grounds of appeal. The respondent’s Counsel submitted that the documents marked “supplementary record of appeal” filed 15/5/02 and another document marked as “bundle of fresh evidence” cannot be part of the record of appeal until i the lower court gives its ruling on the issues of sale of the banking premises. The Counsel observed that the Court of Appeal lacks jurisdiction to hear an appeal directly against the sale of immovable property in execution of judgment. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 151 a Such application can only be heard to set aside such sale if made within twenty days thereafter on the ground of any material in irregularity in the conduct of sale by virtue of b sections 46 and 47 of the Sheriffs and Civil Process Act Cap 123 Volume 3 Laws of Niger State. Counsel cited cases as follows:– BON v NBCI (1990) 5 NWLR (Part 150) 263 at 272 C – c D; and Anueyiagu v Deputy Sheriff Kano (1962) 1 All NLR (Part 2) 52 at 944 – 5. Ground six being a direct challenge on the sale of the d banking premises is premature until the motion to set aside the sale has been determined. This Court is urged to discountenance ground 6 and issue No. 6 formulated therefrom. Counsel further submitted that ground 2 and its e particulars allege criminality on the part of the respondent. There was an amendment to the statement of defence and counter-claim. Parties joined issues on the amended statement of claim and amended statement of defence, for f trial on the general cause list. An Appellate Court will not entertain an appeal on (sic) issue that was not raised before the trial court. The appellant did not seek leave of court to raise this fresh issue of fraud at g an Appellate Court. An amendment can be made at any of the proceedings before judgment. The appellant did not object to the application for amendment. The appellant’s ground 2 must be struck out and issue two couched h therefrom must be discountenanced. Dahiru v Kamale (2001) 11 NWLR (Part 723) 224; (2001) FWLR (Part 62) 1855. The first respondent observed also that the claim of the appellant must be based on N119,711.90 and not i N199,711.90. The appellant in the reply brief submitted that the supplementary record of appeal transmitted to this Court from the High Court Minna, Niger State on 15/5/02 is vital j and relevant for the proper determination of the two Appeals

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 152 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

No. CA/A/189/03 and CA/A/113/01 before this Court. The a appellant did not reply to the relevancy of the other document marked “bundle of fresh evidence” to the Appeal No. CA/A/113/01. b The appellant abandoned ground six and issue six in the Appeal No. CA/A/133/01 as the issue raised therein has been taken care of in Appeal No. CA/A/189/03. The appellant agrees that the amendment to the statement of c defence and counter-claim is proper but the facts relied upon to prove the issues raised portray an illegal transaction. The court failed to take note of this illegality. The appellant further replied that the respondent was not d misled by the amount claimed as at (page 74) of the record the respondent testified that they were not liable to N199,711.90 and it made reference to the same amount in the address while the judgment of court was based on this e same amount. The appellant did not deem it necessary to file a reply to the counter-claim though it adequately reacted to the counter-claim in its address. I have duly considered the observation and objection of f the respondent’s Counsel. I agree with the appellant’s Counsel that the supplementary record will be required for the determination of the issues raised in the two Appeals CA/A/113/01 and CA/A/189/03 now pending before this g Court. The appellant voluntarily abandoned ground 6 of the grounds of appeal and issue No. 6 distilled therefrom as being incompetent in Appeal CA/A/189/03. The relevant issue having been abandoned is hereby struck out. The h appellant conceded to the amendment effected to the statement of defence but complained about the quality of the evaluation of evidence in respect of the fraud averred in the pleadings at the trial court. i The issue of evaluation of evidence by the trial court shall be adequately considered under issue No. 5 in the appeal. The amount claimed shall be that which the parties agreed upon in their pleadings and upon which the court based its j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 153 a judgment. It is trite that where there is an amendment to pleadings, the amendment takes effect not from the date of the amendment, but from the date of the original document b and the amended pleading substitutes the original one. Any other issue outside the amended pleadings does not arise for determination: Salami v Oke (1987) 4 NWLR (Part 63) 1; Mobil Oil (Nig) Plc v IAL 36 Inc (2000) 6 NWLR (Part 659) c 146. In the instant case only the statement of claim and the amended statement of defence and counter-claim shall be relevant for consideration in this appeal. Equally I consider d the document captioned as bundle of fresh evidence as irrelevant for the purpose of this appeal, as the appellant did not allude to it in the reply brief. The document shall be discountenanced in this appeal. It is accordingly expunged from record. e This Court finds it absolutely necessary to retouch and compress the issues for determination as raised by the appellant for ease of reference as follows:– f (1) Whether the trial court can suo motu make an order to dismiss a suit it had earlier on in the proceedings struck out? (2) Whether relying on the quality of the evidence before g the court the learned trial Judge had rightly entered judgment in favour of the respondent’s counter- claim? (3) Whether with the nature of the proceedings, the trial h court was right to assume that the counter-claim was undefended and consequently enter default judgment against the appellant. i Issue No. 1 Whether the trial court can suo motu make an order to dismiss a suit it had earlier in the proceedings struck out? The appellants Counsel submitted that an action struck j out for want of diligent prosecution can be re-listed, whereas

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 154 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) an order of dismissal made in respect of the same suit on a 2/9/97 deprived the appellant the opportunity of re-listing the case. The court can therefore not alter the order of striking out made on 17/3/97 without inviting the Counsel in b the matter to address it on it. Prior to the order of dismissal the appellant did not apply to the court to re-list the suit struck out. The appellant by the order of court is forever shut out of justice. The appellant was not only denied justice but c also fair hearing of its suit. The court should consider the proceedings a mockery of justice. The appellant cited the cases:– Kassim v Hermann Ebert (Trading as Cash Stores) (1966) d 1 All NLR 55; (1966) NMLR 123; Ogannagbe v Giwa (1969) 2 All NLR 35; Shugaba v UBN Plc (1999) 11 NWLR (Part 627) 459; and SGB (Nig) Ltd v Aina (1999) 9 NWLR (Part 619) 414 at 417. e The respondent replied that the case was transferred from the undefended list to the General Cause List. Parties exchanged pleadings and the case proceeded to trial. The appellant a plaintiff called the first witness. After f examination-in-chief and cross-examination the appellant asked for an adjournment to call further witnesses. The court granted four adjournments thereafter, but the appellant failed to produce the witnesses. On 17/3/97, the appellant and his g Counsel did not appear in court hence the court struck out the plaintiff’s claim. The court proceeded to hear the respondent’s counter-claim. In the final judgment the trial court decided in favour of the counter-claim while h dismissing the plaintiff’s claim. The appellant did not re-list the suit before the final order of dismissal was made. The appellant defended the counter-claim. The appellant’s case ceased to be pending after the court proceeded with the trial of the counter-claim and gave final judgment on same. The i whole argument on miscarriage of justice in view of the order of dismissal becomes academic and should be discountenanced because of this appeal. This Court now has the opportunity to examine the plaintiff’s case. In the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 155 a absence of any cogent evidence to establish the plaintiff/ appellant’s claim before the trial court, the court was right to have considered the plaintiff’s case on its merit and make a b final order of dismissal. The respondent cited the case of Ekong v Udo (2002) 16 NWLR (Part 792) 1 at 25 – 26.

Issue No. 2 c Whether relying on the quality of the evidence before the court the learned trial Judge had rightly entered judgment in favour of the respondent’s counter-claim? The appellant submitted that the respondent agreed to d repaying her debt by issuing dud cheques. The respondent declared this in the affidavit in support of her notice of intention to defend and affidavit of good defence out of time. Vide (pages 44, 51 – 53 of the record). The respondent e never denied that it was in full knowledge of the fact that the cheques were returned. The counter-claimant claimed that the cheques were not presented and that this was detrimental to it but the appellant f did not explain this. The respondent did not establish that it has an account with those banks. The respondent did not show how it had complained about how its account as (sic) operated. He wrote a letter of undertaken (sic) on 5/6/91 g after his cheques had been returned uncleared. The appellant was right to have debited the respondent’s accounts with the returned cheques. Appellant cited cases as follows:– Barclays Bank DCO v Hassan (1961) 4 All NLR 836 at h 866; Bank of the North v Yau (2001) 10 NWLR (Part 721) 408; and Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201. The court ought to have rejected the respondents counter- claim as same was tainted with illegalities. The respondent i amended its statement of defence and counter-claim by expunging the incriminating assertions made in the two documents. The amendment did not take the original documents out of the case file and the appellate court can j still consider a document withdrawn or struck out so as to do

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 156 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) substantial justice in this matter. This Court will see that the a judgment of the lower court is perverse and same should be set aside. The counter-claimant must not be allowed to benefit from its illegality. b The appellant cited cases in support of the foregoing submission as follows:– South Eastern Newspaper Corporation v Anwara (1975) 9 – 11 SC at 55; A-G, Edo and Delta States v Jessica Trading c Co (1999) 5 NWLR (Part 604) 500 at 502; Okafor v Okafor (2000) 11 NWLR (Part 677) 21; (2000) FWLR (Part 1) 17 at 19; Seriki v Are (1999) 3 NWLR (Part 595) 469 at 72; and Sodipo v Lemminkainen and others OY (1986) 1 NWLR d (Part 15) 220; (1986) All NLR 78 at 97. There was no cause of action before the court, as the mere exercise of right of action by suing a party cannot give rise to a counter-claim particularly when the original suit was not e bad in law and still pending. The evidence of DW1 had no evidential value. There was no counter-claim for any specific amount. f There was no evidence of financial and corporate standing of the counter-claimant to warrant the award of N500,000 as general damages. There was no evidence of how much was in the respondent’s account or how much was left there. This g Court should hold that there was no proper evaluation of the evidence available by the trial court. In effect the counter- claimant never had a cause of action and never proved one. The appellant cited cases as follows:– h Dagazau v Borkir International Ltd (1999) 7 NWLR (Part 610) 293; Gbafe v Gbafe (1996) 6 NWLR (Part 455) 417 at 578; and Tsokwa Motors (Nig) Ltd v Awoniyi (1999) 1 NWLR (Part 586) 199 at 200. i The respondent replied that the counter-claimant called one witness who testified that there was no loan of N200,000 granted by the appellant. It denied liability for the plaintiff’s claim of N119,711.90. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 157 a The cheques exhibits “D” – “D1 – 10” drawn on other banks paid in by the counter-claimant were paid into her account and later entered as having been returned unpaid. b The cheques were never sent to those other banks for clearance but the counter-claimants account was always debited. The bank charged commission on overdraft and handling charges on uncleared cheques. The counter- c claimant gave evidence of running her account until it was abandoned in 1992 because of the manner the account was handled. The appellant never sent out the uncleared cheques for clearance, while it continued to charge interests and commissions on them. The appellant’s counsel did not cross d examine the counter-claimant’s witness neither did it offer any defence to the counter-claim. There is no appeal against the award of N500,000. This Court is urged to affirm the decision and award of damages made by the lower court. e The respondent referred to a case in support of his submission – Apena v Aiyetobi (1989) 1 NWLR (Part 95) 85 at 97. f Issue No. 3. Whether with the nature of proceedings, the trial court was right to assume that the counter-claim as undefended and consequently entered default judgment against the appellant. g The appellant submitted that at the time the claim was struck out, there was enough evidence before the court to enter judgment for the appellant. The appellant PW1 gave evidence that the respondent was indebted to the appellant. h The appellant tendered exhibits “A” – “D”. Rather than closing the case of the appellant and proceeding to the defence of the respondent, the trial court struck out the appellant’s claim. This could have given the i court opportunity to consider the case of both parties before arriving at any decision on same. Thereafter, the court suo motu without relisting the suit made an order of dismissal in respect of same. The appellant was in the process of j securing more witnesses in support of his case when the case

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 158 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) was struck out. The court failed to consider the reply to the a counter-claim and relied on non-calling of witnesses by the appellant in the counter-claim to enter a default judgment. The court based the judgment on the assumption that the b counter-claim was not defended. In the case of Oshodi v Eyiwunmi (2000) 13 NWLR (Part 684) 298 at 390 the Supreme Court held that:– “A reply is the defence of the plaintiff to the counter-claim of the c defendant, and shall therefore be filed to answer the defendant’s averment in his counter-claim.” In short a party must succeed on the strength of its claim, and not on the weakness in the case of the other party to d produce evidence. This Court should see the case of the appellant as defended and set aside the default judgment given in the counter claim. The appellant referred to the cases of:– Victoria Anisiuba v Anthony Emodi (1975) e ECSLR 355; Oyewole v Oyekola (1999) 7 NWLR (Part 612) 560 at 561; Oseni v Oniyide (1999) 13 NWLR (Part 634) 258 at 263; and Nnamdi Azikiwe University v Nwafor (1999) 1 NWLR (Part 585) 116 at 125 – 126. f In reply the respondent submitted that the case was not heard on the undefended list but on pleadings on the general cause list. At the time of hearing of the matter, the appellant relied on the statement of claim, and the respondent on the g amended statement of defence and counter-claim. The appellant was in court during the hearing of evidence by the respondent in proof of the counter-claim. Apart from the reply to counter-claim in answer to the original counter- h claim the appellant did not file any defence to the new counter-claim. When the appellant was called to cross- examine the counter-claimant’s witness the plaintiff’s Counsel replied in the negative. When asked to open the appellant’s defence to the counter-claim, he also replied that i the appellant had no defence to the counter-claim. The respondent submitted further that this case could only be tried based on the evidence adduced in proof of issues that were joined based on the pleadings filed; the counter-claim j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 159 a and the amended defence thereto. The Court is urged to resolve the issue in favour of the respondent. I have given due and painstaking consideration to the b copious submissions of Counsel on the issues raised for the determination of this Court in this appeal. I shall consider the three issues seriatim. Before then I have to highlight certain facts of common interest and emphasise the claims of c the parties before the lower court before the consideration of the issues. The appellant as plaintiff and respondent as defendant/ counter-claimant prior to the filing of this action enjoyed a d bank and customer relationship – whereupon the respondent operated a Current Account No. 20027 with the appellant at its Minna Branch. The appellant’s claim was based on the respondents defaulting in repaying the loan received from e the appellant. Hence the appellant’s claim in the writ or the undefended list reads as follows:– (a) The sum of N199,711 as at 31/5/95; (b) Interest at 21 % per annum until judgment is given, f thereafter at 10% per annum until judgment debt is fully paid; (c) Costs. g The matter which was originally filed on the undefended list, was transferred to the general cause list when parties filed pleadings as follows:– The appellant filed the statement of claim, and the h respondent filed its statement of defence and counter-claim. The appellant filed a reply to the counter-claim. The appellant put the first PW into the box, who gave evidence and was cross-examined on 25/6/96. The appellant i applied for a date to adduce further evidence by calling additional witnesses which the court granted. The appellant failed to present his witnesses on four adjourned dates granted by court for this purpose. On 17/3/97 the appellant j did not appear in court. On the application of the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 160 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) respondent’s Counsel, the court struck out the appellant’s a claim. Vide (page 71 of the record). The court proceeded to hear the respondent’s counter- claim. An application by the respondent to amend the b statement of defence and counter-claim was granted. The appellant did not amend his pleadings. The respondent adduced evidence based on the amended statement of defence and counter-claim. The appellant did not cross- c examine DW 1 – in the counter-claim, it did not adduce any evidence either but proceeded to address the court thereafter. The learned trial Judge in his judgment in respect of the counter-claim concluded that:– d “I have studied exhibits AC, BC, CC and DC as well as exhibits D1 – D10. I find the counter claimant’s assertions tenable. The organization has established and proved their claim against the defendant. The defendant’s claim against the counter claim has no e basis and is dismissed. Judgment is hereby entered in favour of the counter claimant i.e. Awanna Trading Stores (Nig) Ltd against African Continental Bank Plc.” The learned trial Judge took into consideration the status of f the parties and the gravity of damages caused before awarding the counter-claimant N500,000 and N5,000 costs against the appellant. Vide (pages 85 – 86 of record). The learned trial Judge made an order on 17/3/97 of g striking out the appellant’s claim for non-appearance of the appellant and Counsel. At that stage of the proceedings parties had filed and exchanged pleadings. The appellant had examined the first witness and the court obliged the Counsel h an opportunity to call more witnesses by adjourning the case. The court further in the judgment on the counter-claim made an order dismissing the plaintiff’s case which he had already struck out before commencement of trial in the counter claim. i I regard these steps:– (1) Striking out of the appellant’s claim on 17/3/97 rather than closing same. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 161 a (2) Making an order of dismissal in respect of the same claim in a counter-claim of the respondent, based on no premises as an array of procedural irregularities. b The appellant’s claim was then part-heard, the proper step was to have closed the appellant’s case and call upon the respondent to put in its defence so as to dispose of the case on merits. c As a court is not competent to revive a suit struck out save on the application of either party, the order of dismissal was wrong. d Woluchem v Wokoma (1974) All NLR 543 at 555; (1974) 3 SC 153; (1974) 3 SC 153. The court went on to dismiss the claim suo motu without any request by any of the Counsels, neither were they invited e into the matters so as to address the court on the propriety of granting the order of dismissal in respect of a matter already struck out. The court made the order based on the evidence in the counter-claim whereas the appellant’s claim was quite f distinct and separate from the respondent’s counter-claim. The order was made by the court from the blues, and devoid of any legal backing. I regard the order of court in the circumstance as a grave irregularity. The courts of law do g not make an order in vain but for a purpose and the purpose must be definite and identified. This is not the position in the circumstance of this case where the order of dismissal had no basis or foundation. The appellant had credible evidence before the court at the material time of striking out of the h suit on which the respondent might base a plausible defence. The evidence of PW1 then before the court on perusal adequately summed up the case of the appellant, it is only where the plaintiff had on the merits failed to prove his case i that a verdict of dismissal could be recorded. A court of law has no jurisdiction to raise and decide an issue or point of law which was not raised or canvassed or relied upon by the parties before it. It has no power suo motu to raise prayers j not sought by parties and proceed to grant them. Where a

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 162 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) court raises an issue suo motu it has a duty to give parties an a opportunity to make their comments on them. Ebba v Ogodo (1984) 1 SCNLR 372; b Juwo v Shehu (1992) 8 NWLR (Part 258) 129; Kuti v Balogun (1978) 1 SC 53; and Olusanya v Olusanya (1983) 1 SCNLR 134. Going a step further the order of dismissal made by the c learned trial Judge does not in my view accord with the constitutional provision of fair hearing as enshrined in section 33(1) of the 1979 Constitution. The appellant was not heard when the court made an order of dismissal of his d claim. The attribute of fair hearing presupposes that the court or tribunal shall hear both sides not only in the case but also on all other material issues before reaching a decision in the case which may be prejudicial to any party in e this case. Natural justice demands that a party must be heard before the case against him is determined. Adigun v A-G, Oyo State (1987) 1 NWLR (Part 53) 678; and Umar v Onwudine (2002) 10 NWLR (Part 774) 129. f The Counsel for the appellant was present in court throughout the hearing of the counter-claim, and he was not invited by court to comment on the initial claim. g I do not see the step taken by the learned trial Judge as a mere procedural error but a mistake which goes to the root of the case. Since it is the saying that an unfair method cannot produce a fair result, the normal steps to take in the h instance of this case is to set aside the order of dismissal. Issue No. 1 is resolved in favour of the appellant. Issue No. 2. Whether relying on the quality of the evidence before the i court the learned trial Judge had rightly entered judgment in favour of the counter claimant? I need to specify that a counter-claim is a claim presented by a defendant in opposition to or deduction from the claim j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 163 a of the plaintiff. In other words it is a claim which if established will defeat or diminish the plaintiff’s claim. It is also a means whereby a debt could substantially or b materially be disputed. A counter-claim is a separate and independent action from the action in which it is raised. Animashaun v Olojo (1990) 6 NWLR (Part 154) 111; and Oduwole v LSDPC (2004) 9 NWLR (Part 878) 382. c The question raised by this issue is that of evaluation of evidence by the trial court. Whether it had rightly found for the counter-claimant on the evidence available. In proving an issue in a civil action, the evidence of both parties to the d action is put on an imaginary scale and weighed to see where the scale tilts based on preponderance of qualitative and probative value of the evidence adduced before the trial court. Mogaji v Odofin (1978) 4 SC 91; Jack v Whyte (2001) e 6 NWLR (Part 709) 266. A Court of Appeal will not interfere with a finding of a trial court where it is supported by cogent and convincing evidence, except where the finding is shown to be perverse f or based on the wrong principle of law. Woluchem v Gudi (1981) 5 SC 291; Ebba v Ogodo (1984) 1 SCNLR 372; Kyari v Alkali (2001) 11 NWLR (Part 724) 412. g At the hearing of the counter-claim, there was an amended statement of defence and a new counter-claim, apart from the reply to the counter-claim in answer to the original counter-claim. There was no defence to the new amended h counter-claim. The case could only be tried by the trial court based on the evidence adduced in proof of issues that were joined on the pleadings filed. The position before the trial court in the counter-claim was that the appellant on cross- i examination failed to establish that it approved and granted N200,000 facilities to the counter-claimant, and that it made use of such facility. How the appellant came about the claim of the debt of N119,711.90 or N199,711.90 was not properly j explained. The counter-claimant complained that the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 164 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) account was not properly run by the appellant. The appellant a during trial of the counter-claim did not cross-examine, it also did not put in any defence to the counter-claim. The appellants Counsel said at the hearing of the (sic) that “We b have no defence to the counter-claim”. It is trite that when averments in pleadings are not denied or converted (sic), they are deemed to be admitted. The appellant referred to the documents in the record to which c this Court can refer so as to do substantial justice. The reply to the counter-claim is a bundle of facts pleaded. Parties can only plead facts. In other words, pleadings are only facts and not evidence. Parties only plead facts and not evidence or d law resulting from the facts. Parties must give evidence in support of their pleadings:– UAC v Owoade 13 WACA 207; Peenok Investments Ltd v Hotel Presidential Ltd (1982) 12 SC 1; and Thanni v Saibu e (1977) 2 SC 89. The appellant Counsel vigorously addressed the Court thereafter. I have to emphasize also that addresses of f Counsel cannot alter the acceptability of the primary evidence coming from the witnesses in a proceeding. Counsel’s address is not a substitute for the evidence in court. g Odubeko v Fowler (1993) 7 NWLR (Part 308) 637; and NAB Ltd v Felly Keme (Nig) Ltd (1995) 4 NWLR (Part 387) 100. h The appellant failed to plead or give evidence in support of the fraud alleged in respect of the cheques issued by the counter-claimant. It is not the duty of the court to fish round for evidence in support of a party’s case, neither should a court be left to speculate. It is apparent that in the evaluation i of evidence by the trial court in the counter-claim, the imaginary scale tilts in favour of the counter-claimant. This court has no reason to tamper with the findings and conclusion of the lower court in the circumstance of the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 165 a case. This issue is resolved in favour of the counter- claimant. b Issue No. 3 Whether with the quality of the evidence at the trial court it was right to assume that the counter-claim was undefended and consequently entered judgment against the appellant. c Where there is a dispute between a bank and its customer in relation to recovery of loan advanced by the banker to customer the questions the court should normally consider are:– d (1) Was the defendant granted a loan by the plaintiff; (2) If so how much; (3) What was the interest agreed; e (4) How much if any has the defendant paid out of the loan. FBN Plc v Obeya (1998) 2 NWLR (Part 537) 205 at 207. f The claim of the appellant before the trial court was predicated on an alleged overdraft of N200,000 granted and fully utilised by the respondent. The request for the overdraft was made on exhibit A and supported by a letter of g undertaking. The evidence of full withdrawal of the loan is exhibit D – the statement of account. In the amended statement of defence and counter-claim the respondent denied the claim. The appellant did not file a h reply or in any way react to the amended statement of the defence and counter-claim. The claim of the appellant for the outstanding loan was struck out on 17/3/97 for lack of diligent prosecution based i on failure to produce further evidence having requested for time to do so from court. There was virtually no pleadings filed to the counter-claim. During the hearing of the counter- claim the appellant’s Counsel declined to cross-examine the j defence witness. When the court invited the Counsel for the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 166 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) defendant he replied that “We have no defence to the a counter-claim.” There was no denial of the averments in the counter- claim. As I have mentioned earlier on, pleadings and address b by Counsel cannot replace or be a substitute for evidence adduced by parties. The learned trial Judge was justified in the circumstance to hold that there was no defence to the counter-claim. c Judgment in the counter-claim is not a default judgment as by the conduct of the appellants Counsel, failure to file a reply to the amended statement of defence and counter- claim and to defend the action during the trial of the counter- d claim was deliberate. The appellant had the opportunity to hear and determine its case on merits. Issue No. 3 is resolved in favour of the counter-claimant. In the final analysis the appeal succeeds in part. The order dismissing the appellant’s e claim is hereby revoked. The order of the lower court in the counter-claim is affirmed. I shall make no order as to costs. f In Suit No. NSHC/MIN/169/95 the counter-claimant got judgment against the appellant/applicant of a sum of N505,000 as general damages and costs. In the execution of the judgment debt, the appellant’s banking premises was sold at a public auction on the 27/3/98 for a sum of g N2,100,000. The appellant filed a motion praying the court for the following orders:– (1) Leave of court granting extension of time within h which the applicant may apply to set aside the sale of applicant’s immovable property its Banking Branch Office at Umaru Brena Street, (behind C.B.N.), Minna sold by the counter claimant. i (2) An order of the court deeming this application as being properly served and filed. (3) An order of this court joining Chuhuzor A. Annachibe as a party in this application. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 167 a (4) An order of court setting aside the sale of the applicant’s immovable property the Banking office situated at Umaru Brena Street (behind CBN, b Minna) sold in execution of the counter-claimant’s judgment. (5) An order of the court declaring the sale null and void. Mr. Ibrahim Isiaku Counsel for the respondent c filed an objection against this application praying for the following orders:– “An order striking out the substantive application for lack of jurisdiction”. d The grounds on which he raised the objection are that:– (a) Time within which the application may be brought has elapsed. e (b) Sale is absolute. The parties made submissions on the objection and same was adjourned for ruling on 31/1/2001. In the ruling delivered on 12/5/03 the learned trial Judge upheld the f respondent’s objection. Dissatisfied with the ruling, the appellant/applicant filed an appeal to this Court. The notice of appeal had four grounds of appeal. Parties filed and exchanged briefs. At the g hearing of the appeal by this Court on 16/2/06, the appellant adopted and relied on the brief filed on 16/2/04 and the respondent on the brief deemed filed on 6/4/05. h In the appellant’s brief, three issues were distilled for determination from the four grounds of appeal as follows:– (1) Whether the proceedings and consequent ruling of the trial court are not a nullity by the fact that the i learned trial Judge took the proceedings and the ruling in Chambers. (2) Whether the Honourable Court was right to have delivered a ruling in a matter when the appellant had j withdrawn the matter.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 168 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(3) Whether considering the fundamental irregularities a in the sale of the appellant’s banking premises, the Honourable trial court was right to decline jurisdiction to set same aside on the strength of b sections 46 and 47 of the Sheriff and Civil Processes Law Cap 123 of the Revised Laws of Niger State, 1989. The respondent identified three issues for determination as c follows:– (1) Whether the proceedings in this case were conducted by the trial court in chambers. (2) Whether the filing of the process titled “notice of d withdrawal of the motion filed on 17/2/2000 without more ended the proceedings before the trial court”. (3) Whether the trial court was right when it declined jurisdiction to entertain the application to set aside e the sale. I do not see an apparent difference in the issues formulated by the parties in this appeal. I shall be guided by the three f issues in the appellant’s brief in this appeal.

Issue No. 1 Whether the proceedings and consequent ruling of the trial court are not a nullity by the fact that the learned trial Judge g took the proceedings and delivered the ruling in Chambers. The appellant submitted that the hearing of the respondent’s preliminary objection by the honourable trial h court in Chambers and the ruling delivered on same in Chambers contravened the clear provisions of section 36(3) of the Constitution of the Federal Republic of Nigeria, 1999, Order 40 rule 1 of the Niger State High Court (Civil Procedure) Rules, 1987. Order 36 enumerated applications i and proceedings which a judge can entertain in Chambers, a preliminary objection raised to jurisdiction is not one of them. It is mandatory that a Judge must sit in open court except as provided in paragraphs (a) and (b) of the proviso j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 169 a to sections 36(3) and (4) of the Constitution. A Judge’s chamber is not an open court consequently the ruling of 12/5/02 having been delivered in Chambers was a nullity. b The appellant cited cases to buttress the submission:– Oviasu v Oviasu (1973) 11 SC 315 at 328; and Ogele v Nuhu (1997) 10 NWLR (Part 523) 109. The appellant urged the Court to set aside the ruling. The c respondent replied that there is nothing on record to show that the proceedings in respect of the respondent’s objection as well as the ruling took place in Chambers. The objection was taken on 29/9/2000, and this is on page d 71 of the record, while the ruling is on page 76 of the same record. This Court is bound by the certified record transmitted by the trial court, which is a public record and there is a presumption that the contents are correct by virtue e of section 114(1) of the Evidence Act. The respondent cited the cases:– Nwankwo v Abazie (2003) 12 NWLR (Part 834) 381 and Ogolo v Fubara (2003) 11 NWLR (Part 831) 231. f Issue No. 2 Whether the honourable court was right to have delivered a ruling in a matter when the appellant had withdrawn the g matter. The appellant submitted that notice for the discontinuance of the motion to set aside the sale of the property was served on the respondent on 26/11/02. Despite the fact that the substratum of the preliminary objection was h rightly removed, the trial court without any notice to the appellant delivered a ruling on 12/5/03. The respondent submitted by way of reply that the appellant filed a motion on 17/2/2000 to set aside a sale but i the respondent challenged the competence of the court to entertain the suit. While awaiting the court’s ruling on the objection, the appellant filed a notice informing the court of his intention to withdraw the suit in accordance with Order j 29 rule 2(1) of the Niger State High Court (Civil Procedure)

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 170 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Rules. Since the appellant failed to do so within 14 days a statutory period, he must obtain leave of court for the discontinuance of the action. A mere notice of his intention to withdraw as the appellant has done is wrong as leave was b not obtained and granted. The respondent referred to cases:– Odje v Ovien (1992) 7 NWLR (Part 253) 309; and Omo v Amantu (1993) 3 NWLR (Part 280) 187 at 195 – 196. c Issue No. 3 Whether considering the fundamental irregularities in the sale of the appellant’s banking premises, the trial court was right to decline jurisdiction to set same aside on the strength d of sections 46 and 47 of Sheriff and Civil Process Law Cap 123 of the Revised Laws of Niger State, 1989. The appellant submitted that the lower court wrongly interpreted and applied sections 46 and 47 of Sheriffs and e Civil Process Law of Niger State in pari materia with sections 47 and 48 of the Sheriffs and Civil Process Act Cap 407 Laws of the Federation of Nigeria, 1990. It was not the intention of the Legislature to make sale under section 47 f irreversible and non-reviewable by the court when the need arises. That was the reason the operative word in statute is deemed. This Court should hold that the plain interpretation and effect to be given to sections 46 and 47 of the Sheriff g and Civil Process Law is that after 21 days the sale is presumed to be absolute sale. It remains so until the contrary is proved. The contrary is proved when there are fundamental and material irregularities in the conduct of the h sale. Apart from the fact that the appellant was not served with any notice of the application to attach its property, the sale itself was irregular as being in contravention of procedural laws and practice. The attachment of the appellant’s property was contravention of the statutory i requirement that movable property of the debtor must first be attached. The judgment creditor must furnish evidence as to what has been done to find the judgment debtors movable property. There was no such evidence before court in this j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 171 a case. By the combined effects of sections 251(4) and 47 the Sheriff and Civil Process Law of Niger State, section 251(4) 1979 Constitution amended by Decree No. 107 of 1993 and b Order 1 rule 5 of Sheriff and Civil Process Act Cap 407 Laws of Federation of Nigeria, 1990 the sale of the appellant’s property on 27/03/98 was void. Sections 46 and 47 of the Sheriff and Civil Process Law c do not oust the jurisdiction of the Court to set aside a sale which is invalid. The appellant referred to cases in support of the submission:– UBN Ltd v Fajebe Foods (1994) 5 NWLR (Part 344) 325; d Nigerite (Nig) Ltd v Dalami (Nig) Ltd (1992) 7 NWLR (Part 253) 288; Kabiru Bayero v Federal Mortgage Bank (Nig) Ltd and others (1998) 2 NWLR (Part 538) 509; and Mutual Aid Society Ltd v FH Ogonade NNLR 18. e The respondent argued that sale of the appellant’s property took place on 27/3/98, while application to set aside was brought on 17/2/2000 two years after the sale. Under section 47 of Sheriff and Civil Procedure Act, an application to set f aside the sale of an immovable property can only be entertained if made within 21 days from the date of the sale. When this condition is not met the sale will be deemed absolute. The sale was not challenged within 21 days and it g was thereafter deemed absolute. The appellant admitted that it was informed about pending sale if it failed to pay the judgment sum vide page 42 of the record. The appellant had the opportunity to stop the sale or apply h to set aside the sale within the 21 days stipulated but it failed to do so. Where the court lacked jurisdiction because a matter is statute-barred, the court cannot extend time to confer jurisdiction on itself. In effect, application to set aside i the sale is statute-barred. The respondent cited the case of Anueyiagu v Deputy Sheriff, Kano (1962) 1 All NLR 940 at 945. Under Issue No. 1, this Court is to determine whether the j learned trial Judge conducted proceedings and delivered the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 172 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) ruling subject matter of this appeal in Chambers. The a Constitution of the Federal Republic of Nigeria, section 36(3) provides that:– “The proceedings of a court or the proceedings of any tribunal b relating to the matters mentioned in subsection (1) of the section including the announcement of the decisions of the court or tribunal shall be held in public”. Order 40 rule 1 of the Niger State High Court (Civil c Procedure) Rules, 1987 provides that:– “The decision or judgment in any suit shall be delivered in open court, unless the court otherwise directs for sufficient cause”. The preliminary objection was heard on 29/11/2000 (vide d pages 71 – 74 of the record) and ruling was delivered on 12/5/03 pages 77 – 83 of the record from all indications it did not show that both court proceedings were heard in Chambers. I cannot but take judicial notice of the practice e that records used for sitting in Chambers are different from those used for sittings in the open court and are usually separated. Issue No. 1 is resolved in favour of the respondent. f In Issue No. 2, the appellant contended that between the date of hearing of the preliminary objection and delivery of the ruling on 21/5/03, the appellant filed notice to discontinue its motion to set aside the sale of the property g and the discontinuance was effectively served on the respondent. The motion was no longer in existence when the court delivered its ruling on 12/5/03. The order of court made in the ruling delivered on 12/5/03 was made in vacuo. h The relevant notice of withdrawal is in page 75 of the record. The application brought pursuant to the inherent jurisdiction of court was captioned “Notice of withdrawal of the motion filed on 17/2/2000”. i The application reads:– “Take Notice that the judgment/debtor applicant in the above motion is desirous of withdrawing the motion filed on 17/2/2000 and has accordingly withdrawn same.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 173 a Order 29 rule 1 of the Niger State High Court (Civil Procedure) Rules, 1987 provides that:– “The plaintiff in an action may without the leave of the court, b discontinue the action, or withdraw any particular claim made by him therein, as against any or all of the defendants at any time not later than 14 days after service of the defence on him or, if there are two or more defendants, by serving a notice to that effect on the defendants concerned.” c In this instance, the motion of the appellant was filed on 17/2/2000 and the respondent filed its counter-affidavit on 4/3/2000. The appellant filed a further and better affidavit on 13/7/2000. Notice of withdrawal was filed on 26/4/02, d which was filed outside the fourteen days stipulated in Order 29 rule 2(1) of the Niger State High Court (Civil Procedure) Rules, 1987. Leave of court becomes necessary for him to withdraw his motion. As leave was not applied for and e granted by court in respect of his notice on page 75 of the record the motion filed on 17/2/2000 has not been withdrawn. The motion filed on 17/2/2000 is still valid and also the ruling in respect of same when it was delivered on f 21/5/03. Issue No. 2 is resolved in favour of the respondent. Issue No. 3 challenges the jurisdiction of court to set aside the sale of the property of the appellant which occurred on 27/3/98. The application was brought on 17/2/2000 two g years after the sale. The respondent canvassed in the objection to the courts jurisdiction that the action was statute-barred, as the appellant’s failure to bring the application to set aside the h sale within 21 days rendered the sale absolute. The court cannot enlarge time to give itself jurisdiction where an action is statute-barred. Sections 46 and 47 of the Sheriffs and Civil Process Law of Niger State are in pari materia i with sections 47 and 48 of the Sheriffs and Civil Process Act Cap 407 Laws of the Federation of Nigeria, 1990 which provide as follows:– “Section 46 At anytime within twenty one days from the date of j the sale of any immovable property, application may be made to

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 174 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

the court to set aside the sale on the ground of any material a irregularity in the conduct of sale, but no sale shall be set aside on the ground of such irregularity unless the applicant shall prove to the satisfaction of the court that he has sustained substantial injury by reason of such irregularity.” b “Section 47 If no such application as is mentioned in Section 46 shall be made the sale shall be deemed absolute. If such application be made and the objection disallowed the court shall make an order confirming the sale and in the like manner. If the c objection be allowed the court shall make an order setting aside the sale for irregularity”. It is apparent from the provisions of the Sheriffs and Civil Process Act that:– d (a) An applicant must bring the application within 21 days from the date of the sale. (b) The application must be based on material e irregularities in the conduct of the sale. (c) The applicant must prove to the satisfaction of the court that he has sustained substantial injury by f reason of such irregularities. Under section 48 of the law, non-compliance with the foregoing makes the sale absolute. The appellant brought the application two years after the sale. He now sought for an g extension of time to bring an application to set aside the sale. The poser now is whether it is possible to bring an application to extend the time provided by law or statute to h do an act under the inherent jurisdiction of court? In this case the Sheriffs and Civil Process Law of Niger State makes provision for twenty-one days within which to apply to set aside a sale of property on grounds of irregularity in i the conduct of such sale without a room for extension of such period. There is no provision of the statute allowing for extension of time to set aside a sale which has become absolute. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA ACB Plc v Nwanna Trading Stores (Nig.) Ltd. 175 a Against this background the records of proceedings reveal that:– (1) There is a certificate of purchase showing that the b property was sold by public auction (page 44 of the record). (2) That the appellant was informed about the pending sale (page 42 of the record). c (3) That the appellant knew that judgment had been entered against it and execution was about to be levied against the property. d (4) Appellant was invited to collect the balance of the sum realised on the sale after deduction of the judgment sum (page 50 of the record). In effect the appellant had adequate opportunity to act e timeously to stop the sale or set aside the sale but failed to do so. Where a statute makes no provision for extension of time where limitation of time is imposed, the courts cannot f extend time to do so. I have examined the grounds relied upon by the appellant to conclude that the sale of the property was full of fundamental and material irregularities, I cannot but g conclude that these are matters affecting the conduct of the sale of the appellants property. They come within the provisions of sections 46 and 47 of the Sheriffs and Civil Process Law and the 21 days limitation period. h Saleh v Monguno (2003) 1 NWLR (Part 801) 221. It is trite that where a statute provides for the commencement of an action within a given time or period, no proceedings can be commenced after the period i prescribed by the statute has elapsed. Thus any action instituted after the period is statute-barred and the right of the plaintiff to commence the action is said to be extinguished by operation of law. Egbe v Adefarasin (No.1) j (1985) 1 NWLR (Part 3) 549; Obiefuna v Okoye (1961) 1

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, ABUJA DIVISION) Adekeye JCA 176 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

SCNLR 144; (1961) All NLR 357; Adeosun v Jibesin (2001) a 11 NWLR (Part 724) 290. Since the Sheriffs and Civil Process Act does not contain provision for extension of time, the application for such b extension for the purpose of setting aside a sale which is absolute is incompetent, and I hold that the learned trial Judge was right to have declined jurisdiction. Issue No. 3 is resolved in favour of the respondent. In sum c this appeal therefore lacks merit and it is accordingly dismissed. The decision of the lower court is affirmed. There shall be no order as to costs. In the final analysis in the consolidated appeals, the lower d court dismissing the claim of the appellant already struck out, is revoked. While the two appeals filed lack merit and they are both consequently dismissed with no order as to costs. e

ODILI JCA: I have read the draft of the judgment of my learned brother, OO Adekeye, JCA. I agree with the decision in the two consolidated appeals and there is nothing f more to add. I abide by the orders of my learned brother.

RHODES-VIVOUR JCA: I have read the leading judgment of my learned brother Honourable Justice OO Adekeye, JCA dismissing both appeals. I agree fully with the reasons given g by my learned brother for reaching the above conclusion in the judgment. I adopt the judgment as my own. h Appeal dismissed.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

Agbabiaka v First Bank of Nigeria Plc 177 a Agbabiaka v First Bank of Nigeria Plc

(Appellant substituted for Alhaji SO Agbabiaka (deceased) by order of court dated 25 b February, 2003) COURT OF APPEAL, LAGOS DIVISION ADAMU, GARBA, DENTON-WEST JJCA

Date of Judgment: 16 MAY, 2006 Suit No.: CA/L/49/2001 c Banking – Interest – Main source of bank’s income – When payable – Principles applicable d Facts The respondent in this appeal who was the plaintiff in the High Court of Lagos State, claimed in that court as per its writ of summons and amended statement of claim:– e (1) An order for the specific performance of the agreement between the plaintiff and the defendant (ie) that the defendant should forthwith deliver the f certificate of occupancy in respect of the property at No. 22, Akinbaiye Street, Isolo, Lagos to the plaintiff. (2) The total debt of the sum of N844,207.06k as at the g 17 June, 1992. (3) 15% interest on the total sum owed from 29 January, 1985 until judgment and 10% thereafter until the entire judgment debt is obtained. h (4) Costs as this Honourable Court may deem fit and proper to award in the circumstance. The respondent also filed an application in the lower court i for summary judgment under Orders 10 and 11 rules 1 and 2 of the High Court of Lagos State (Civil Procedure) Rules, 1972 and under the inherent jurisdiction of the Honourable Court with a 14-paragraphed affidavit and 9 exhibits “A1” – j “A8” and exhibit “B”.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

178 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The appellant herein, who was the defendant at the lower a court, filed a 14-paragraphed affidavit showing cause. He attached no exhibit to his affidavit. In the ruling of July 18, 1997, containing the final b judgment, the learned trial Judge, Kekere-Ekun, J of the High Court of Lagos State (as she then was) stated inter alia:– “In the circumstance, judgment is hereby entered in favor of the c plaintiff against the defendant in the sum of N844,207.00k being the cumulative principal and interest due to the plaintiff as at 17 June, 1992 as a result of banking facilities (term loan and overdraft) granted at the request and instance of the defendant on d the sum of N180,000.00k of the cumulative sum.” The defendant is further ordered to pay to the plaintiff interest on the said loan at the rate of 15% per annum from 17 June, 1992 until judgment and thereafter at the rate of 6% e per annum until the whole sum is finally liquidated. The appellant dissatisfied with the judgment of the trial court filed the notice of appeal dated 25 August, 1997. f Held – 1. It is trite law, and a notorious fact that a bank does not give overdraft/loans free of charge, in fact interest g charged is the main source of a bank’s income. 2. The mere fact that a sum of money is substantial is not enough to justify award of interest on debt. The general principle is that interest is not payable or recoverable at h common law on ordinary debt in the absence of the following situations: (a) contract, express or implied; or i (b) some mercantile usage; or (c) provision by statute. Appeal dismissed. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

Agbabiaka v First Bank of Nigeria Plc 179 a Cases referred to in the judgment Nigerian 7UP Bottling Co Ltd v Abiola and Sons (Nig) Ltd (1995) 3 b NWLR (Part 383) 257 SC Adeyemi v Lan and Baker (2000) 7 NWLR (Part 663) 33 A-G, Anambra State v Nwobodo (1992) 7 NWLR (Part 256) c 711 Akapo v Hakeem-Habeeb (1992) 6 NWLR (Part 147) 266 Alsthom SA v Saraki (2005) All FWLR (Part 246) 1385 d Atagura v Gura (2005) 2 SC (Part 1) 101 Aubergine Collections Ltd v Habib Nig Bank Ltd (2002) FWLR (Part 128) 1276; (2002) 4 NWLR (Part 757) 338 Babalola v Oshogbo LG (2003) 16 NWLR (Part 289) 465 e CA Consortium MC v NEPA (1992) 6 NWLR (Part 246) 132 Daniel v Samad (1997) 7 NWLR (Part 514) 673 f Eastern Plastics v Synco (WA) (1999) 1 NWLR (Part 587) 456 Ebele v Ikweki (No. 2) (1995) 7 NWLR (Part 405) 91 Elike v Nwankwola (1984) 12 SC 301 g Famuroti v Agbeke (1991) 13 NWLR (Part 189) 1 FBN Plc v Excel Plast Ind Ltd (2003) FWLR (Part 160) 1624; (2003) 13 NWLR (Part 837) 412 h Global Trans SA v Free Enterprise Nig Ltd (2001) FWLR (Part 40) 1706; (2001) 5 NWLR (Part 706) 426 SC Henkel Chem Ltd v AG Ferrero and Co (2003) 4 NWLR (Part 810) 306 i John Holt and Co v Fajemirokun (1961) All NLR 492 Kenon v Tekam (2001) FWLR (Part 70) 1660; (2001) 14 NWLR (Part 732) 1 j Knightsbridge v Atamako (2000) 2 NWLR (Part 645) 387

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

180 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Macaulay v NAL Merchant Bank Ltd (1990) 4 NWLR (Part a 144) 283 Macgregor v NMB (1996) 2 SCNJ 72 Magit v University of Agriculture Markurdi (2005) 19 b NWLR (Part 959) 211; (2006) All FWLR (Part 298) 1313 MMS v Oteju (2005) All FWLR (Part 270) 1995; (2005) 5 SC 55 c Mohammed v Kano NA (1968) 1 All NLR 424 NDIC v Ifediegwu (2003) 1 NWLR (Part 800) 56 Ndukauba v Kolomo (2005) All FWLR (Part 248) 1602; (2005) 124 LRCN 479 d Obodo v Olomu (1986) 3 NWLR (Part 59) 111 Okpokpo v Uko (1997) 11 NWLR (Part 527) 94 Omo v JSC (2000) FWLR (Part 20) 676; (2000) 12 NWLR e (Part 682) 444 Onajobi v Olanipekun (1985) 1 SC 156 Onifade v Olayiwola (1990) 7 NWLR (Part 161) 130 Oruobu v Anekwe (1997) 5 NWLR (Part 506) 618 f Oyejola v Agboola (1995) 8 NWLR (Part 411) 88 Salu v Egeibon (1994) 6 NWLR (Part 348) 23 Winlyn v NACB (2000) 8 NWLR (Part 594) 597 g

Statute referred to in the judgment Evidence Act section 132 h Rules of court referred to in the judgment High Court of Lagos State (Civil Procedure) Rules, 1972 Order 10, rules 1(a), (b) and Order 11, rules (1) and (2) i Counsel For the appellant: Sofowora (with him Miss Adeshina and Miss Ogboja) For the respondent: Ubiaru j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

Agbabiaka v First Bank of Nigeria Plc 181 a Judgment DENTON-WEST JCA: (Delivering the lead judgment) The respondent in this appeal who was the plaintiff in the High b Court of Lagos State, claimed in that court as per its writ of summons and amended statement of claim:– (1) An order for the specific performance of the agreement between the plaintiff and the defendant c (ie) that the defendant should forthwith deliver the Certificate of Occupancy in respect of the property at No. 22, Akinbaiye Street, Isolo, Lagos to the plaintiff. d (2) The total debt of the sum of N844,207.06k as at 17 June, 1992. (3) 15% interest on the total sum owed from 29 January, e 1985 until judgment and 10% thereafter until the entire judgment debt is obtained. (4) Costs as this Honourable Court may deem fit and proper to award in the circumstance. f The respondent also filed an application in the lower court for summary judgment under Orders 10 and 11, rules 1 and 2 of the High Court of Lagos State (Civil Procedure) Rules, g 1972 and under the inherent jurisdiction of the Honourable Court with a 14-paragraphed affidavit and 9 exhibits “A1” – “A8” and exhibit “B”. The appellant herein, who was the defendant in lower court, filed a 14-paragraphed affidavit showing cause. He attached no exhibit to his affidavit. h In his ruling of July 18, 1997, containing the final judgment, the learned trial Judge, Kekere-Ekun, J of the High Court of Lagos State as she then was stated inter alia:– i “In the circumstance, judgment is hereby entered in favour of the plaintiff against the defendant in the sum of N844,207.00k being the cumulative principal and interest due to the plaintiff as at 17 June, 1992 as a result of banking facilities (term loan and overdraft) granted at the request and instance of the defendant or j the sum of N180,000.00k of the cumulative sum.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 182 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The defendant is further ordered to pay to the plaintiff interest on a the said loan at the rate of 15% per annum from 17 June, 1992 until judgment and thereafter at the rate of 6% per annum until the whole sum is finally liquidated.” b The appellant dissatisfied with the judgment of the trial court filed the notice of appeal dated 25 August, 1997, wherein four grounds of appeal were set out. The learned Counsel for the appellant filed an amended c appellant’s brief on 12 November, 2003 and also formulated four issues for determination in the appeal which accommodated the four grounds of appeal earlier raised. The issues are:– d “(i) Whether the appellant was not denied fair hearing by the learned trial Judge who decided to hear the motion for summary judgment against the appellant in the absence of the appellant and his counsel on a day fixed e by the court clerk or registrar for mention and not for the hearing of the said motion. (ii) Whether from the facts of this case the plaintiff/ respondent had satisfied the conditions for the grant of a summary judgment entitling it to be awarded the entire f amount claimed plus interest in the absence of materials showing how the amount was arrived at. (iii) Whether the learned trial Judge did not misapply the principles of law enuncisated in the case of Macaulay v g NAL Merchant Bank Ltd (1990) 4 NWLR (Part 144) 283 to the facts of this case in holding that the defendant/appellant has no defence to the plaintiff/respondent’s claim. h (iv) Whether in view of the provisions of the section 132(1) of Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, learned trial Judge was right to have entered judgment for the plaintiff/ respondent in the entire sum claimed plus interest when the amount had i not fallen due.” The respondent’s Counsel in his brief of argument filed on 3 March, 2004 adopted the four issues formulated by the appellant with some variance. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 183 a In issue one, learned Counsel for the respondent stated that the matter was adjourned for hearing of the pending motion whereas the appellant in issue one stated that the b matter was adjourned for mention. In the second issue, the respondent stated contrary to the appellant, that the materials showing how the amount claimed was arrived at were before the trial court. c The respondent adopted issue number three (iii) of the appellant verbatim. The only variance in the fourth issue is that while the d appellant stated that the entire sum claimed had not fallen due at the time of judgment, the respondent stated that it had fallen due. The first issue formulated by both parties in this appeal is e most germane, since it borders on the constitutional right of fair hearing. It is settled that where fair hearing has been made an issue by a party, the court must determine it first of all other issues that there may be. See Babalola v Oshogbo f LG (2003) 16 NWLR (Part 289) 465 CA. It may as well be decisive of the present appeal; I shall therefore accordingly deal with it. The plaintiff in the trial court who is the respondent g herein filed its application for summary judgment on 8 March, 1996 together with its affidavit in support. The respondent attached 9 exhibits to its affidavit, all of which were pleaded in paragraphs 11 and 12 of the said affidavit. h See page 33 of the records of appeal. Paragraphs 11 and 12 of the affidavit in support is hereunder reproduced:– i “11. That the defendant’s application for loan Ref: SAH/E/1/85 dated 7 January, 1985, the plaintiff’s reply thereto dated 29 January, 1985, the defendant’s further reply, reference SAH/F/2/85 of 29 January, 1985, the defendant’s solicitor’s letters of 2 February and 8 March, 1985 respectively, j addressed to the plaintiff’s manager and the plaintiff’s form

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 184 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

No. 917, in which the defendant undertook to effect a legal a mortgage to the plaintiff are hereby annexed as exhibits A1 – A8. 12. That the defendant last serviced his account No. 01042374 b on 8 February, 1988, as shown in form No. 3483 herewith annexed as exhibit B.” The respondent’s Counsel duly served the appellant on 20 March, 1996 and filed an affidavit of service in respect of c the motion for summary judgment. The appellant filed an affidavit showing cause on 3 May, 1996 the same day that the case was listed in the trial court, the case was adjourned to 9 July, 1996 for argument. d On 9 July, 1996, the case had already been transferred from the court of Martins, J to the court of Kekere-Ekun, J as she then was, who eventually delivered the judgment now appealed against. The case was therefore adjourned to 13 e January, 1997 for mention. On 13 January, 1997, before the lower court, his Lordship adjourned the respondent’s motion for summary judgment of f 8 March, 1996 for argument to 5 March, 1997, at the instance of the appellant, three days less one year when it was filed. On 5 March, 1997, the appellant’s Counsel who suggested g the hearing date at the last adjourned date was absent in court but, wrote to the court for an adjournment. The respondent’s Counsel stated that he was not copied with the letter for adjournment and that it was the appellant who h suggested the hearing date. Learned Counsel argued that the affidavit showing cause filed by the appellant lacked substance, he urged the court to allow the respondent move his application. i The learned trial Judge in his ruling refused the application of the respondent to move his motion and gave the appellant a last opportunity to defend same. He however added in his ruling that if the situation remained the same, j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 185 a learned Counsel for the respondent shall proceed to move his motion. In his letter for an adjournment, learned Counsel for the b appellant suggested 16 April, 1997 for the argument of the pending application, the application was adjourned to same date suggested. c On 16 April, 1997, the respondent’s Counsel was absent, but wrote a letter informing the court of his indisposition. The case was further adjourned to 14 May, 1997 for argument. d On 14 May, 1997 the learned trial Judge was on a course and so the Court did not sit, the case was therefore adjourned mutually by both Counsel to 7 July, 1997, (after call over). See page 51 of the record of appeal. e Learned Counsel for the appellant was absent on 7 July, 1997 without explanation despite that the date was mutually fixed by both Counsel on the last adjourned date. The learned trial Judge stood down the matter till 12:10pm, when f the appellant’s Counsel was still absent without explanation, the learned trial Judge gave leave to the respondent to move his application of 8 March, 1996 and thereafter reserved ruling till 18 July, 1997. g Before I continue to analyse the first issue formulated by the parties in the present appeal, I observe with displeasure the foul and unacceptable language of the learned Counsel to the appellant in the notice of appeal and amended brief of h argument. The learned Counsel persistently referred to the learned trial Judge as she/her in the notice of appeal and brief of argument and addressed the learned trial Judge in very scornful and rude terms. For example in the fourth i paragraph of the third page in the appellant’s amended brief of argument:– “she should have adjourned the case to a later date ... and also the appellant’s counsel had appeared before her on at least three j different occasions . . .”.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 186 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Also at page five, (line sixteen of paragraph three) of the a appellant’s amended brief of argument:– “she should have realized that . . .”. In this jurisdiction, there is no “she/her” on the bench, every b magistrate is His Worship and every Judge/Justice is His Lordship and are only properly referred to as the learned trial Judge or the learned Justice, the respect that the bench accords the bar must be reciprocal. I am of the firm opinion, c that irrespective of the different views of a Judge and a Counsel on the issues involved in a case, no respect should be lost between them. The learned Counsel for the appellant therefore erred and ought to be brought to order concerning d his manner of address. On proper mode of addressing Judges, the Supreme Court observed thus in Global Trans SA v Free Enterprise Nig Ltd (2001) FWLR (Part 40) 1706; (2001) 5 NWLR (Part 706) 426 SC per Kalgo, JSC at page e 442, paragraphs A-C wherein he said:– “Issue two of the respondent before the Court of Appeal as seen in its brief on page 58 of the record reads– ‘Whether she concluded correctly that the plaintiff had no locus f standi.’ It is common ground that the trial Judge in this case was a lady, and the word, ‘she’ in issue 2 referred to the learned Judge. This is a very bad way of showing discourtesy to a lady Judge or in fact g any Judge at all by referring to him or her in third person pronoun. It is absolutely unethical and unpardonable and whether the Judge is a he or she, reference should be made to the learned trial Judge or learned Judge or even Honourable Judge. I was very disturbed and disappointed to observe that this brief was coming from the h chambers of a respectable Senior Advocate of Nigeria. I hope this type of thing will never happen again.” For lady Judges believe in issues relating to their judicial functions, that mere gender discrimination should not be i alluded to them without due corresponding respect, hence they are brother Judge or sister Judge if and when the situation demands it but not for purposes of disrespect as it was obviously done here. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 187 a On the issue of fair hearing canvassed by the appellant in pages 2 and 3 of the brief of argument, I perused the argument of the appellant and found out, that it is not the b contention of the appellant that he had no notice of the adjourned date, learned Counsel did not contend the averment of the respondent that both Counsel mutually fixed the date when judgment was eventually reserved rather, he c argued that because Mondays were usually call over days and the courts were usually very busy and that he was otherwise engaged in another court and so failed to appear or the least write the Honourable Court. He contended that the case was adjourned by the registrar of court for mention d and not for argument, I find no proof of this in the record of appeal. The learned Counsel for the appellant found it convenient, not to appear in court without explanation, but he expected that the court must wait for him indefinitely. e The application for summary judgment had been filed more than a year before it was eventually heard, the delay in moving the said application was not unconnected to the truancy of the Counsel. In his brief, learned Counsel for the f appellant stated that he was within the court premises but that he was busy in another court. This argument of learned Counsel is not impressive, the date fixed for the hearing of the case now on appeal was not imposed on him, and the g case was further stood down until 12:10pm before it was eventually heard, if learned Counsel was serious he would either have shown up by then, sent another Counsel or written a letter to the trial court. h In my view, the learned trial Judge was fair to both parties, unless the appellant was going to spin a surprise on the respondent, its affidavit showing cause was before the trial court and it was duly considered in the judgment of the i trial court. I do not think that the purport of fair hearing is to allow an unserious Counsel to perpetually frustrate justice by holding the court to ransom, rather, I believe the purport of fair hearing is the interest of justice and justice delayed is j justice denied. I refer to the Supreme Court’s decision on the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 188 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) issue of fair hearing in the case of Magit v University of a Agriculture Markurdi (2005) 19 NWLR (Part 959) 243 – 244 paragraphs F – A; (2006) All FWLR (Part 298) 1313:– “Fair hearing is not a cut and dried principle which parties can, in b the abstract always apply to their comfort and convenience. It is a principle which is based on the facts before the court. Only the facts of the case can influence and determine the application or applicability of the principle. The principle of fair hearing is helpless or completely dead outside the facts of the case.” c The appellant in the lower court had hitherto employed every delay tactics, from filing processes on the dates fixed for court sitting to being absent from court on days suggested by himself. The motion for summary judgment d suffered seven adjournments, many of which were at the instance of the appellant. The appellant deliberately absented himself from court on a date he had notice the matter was coming up, with the only excuse that the court e only should have mentioned the case and not heard the pending motion. This is a deliberate attempt by the appellant to further frustrate the case of the respondent and delay the justice of f the case. It is further instructive that the decision of the Supreme Court in Ndukauba v Kolomo (2005) All FWLR (Part 248) 1602; (2005) 124 LRCN 479 at 492, Oguntade, JSC emphasised on the enshrined provisions of section 36 of g the 1999 Constitution as regards fair hearing when he said:– “In a civil case the principle of fair hearing in relation to a plaintiff translates into these– 1. A plaintiff or any party is entitled to counsel of his choice. h 2. A plaintiff must be afforded the opportunity to call all necessary witnesses in support of his case. 3. A plaintiff by himself or counsel must have the opportunity to cross-examine or otherwise challenge the evidence of i witnesses called by his adversary. 4. At the close of the case and in accordance with the relevant rules, a plaintiff must have the same right as given to his adversary to offer by his final address on law in support of his case.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 189 a See A-G, Anambra State v Nwobodo (1992) 7 NWLR (Part 256) 711; Consortium MC v NEPA (1992) 6 NWLR (Part 246) 132; Akapo v Hakeem-Habeeb (1992) 6 NWLR (Part b 147) 266; 7UP Bottling Co Ltd v Abiola and Sons (Nig) Ltd (1995) 3 NWLR (Part 383) 257 SC; Ebele v Ikweki (No. 2) (1995) 7 NWLR (Part 405) 91. I therefore hold that the appellant was not denied fair c hearing by the learned trial Judge when he heard the respondent in default of the appellant’s appearance on a day mutually fixed by both Counsel after standing the case down for several hours. Issue No. 1 is hereby resolved against the d appellant herein. The second issue canvassed by the appellant challenges the pre-judgment interest claimed and granted by the trial court. The appellant contends that the claim of the e respondent in the lower court for pre-judgment interest was unsubstantiated and that the learned trial Judge was wrong to have granted it. In the lower court, the appellant contended that it was of f the mind that the loan it applied for and was granted by the respondent (a bank) was free of any interest charges. It is trite law, and a notorious fact, that a bank does not give overdraft/loans free of charge, in fact interest charge is g the main source of a bank’s income. The last but one line of the exhibit attached to the respondent’s affidavit at page 37 of the record of appeal informs me that there was indeed an agreement to pay interest on the overdraft facility h granted. The law is settled on the prerequisite for the award of pre- judgment interest. The interest must have been claimed in the writ and statement of claim and evidence must have been i led in support of the claim. The cases of Henkel Chem Ltd v A G Ferrero and Co (2003) 4 NWLR (Part 810) 306; (2004) FWLR (Part 188) 1078 and FBN Plc v Excel Plast Ind Ltd (2003) FWLR (Part 160) 1624; (2003) 13 NWLR (Part 837) j 412 are succinct on the subject of pre-judgment interest.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 190 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

In Henkel Chem Ltd v A G Ferrero and Co (supra) it was a held, on principles guiding the award of interest: “the mere fact that a sum of money is substantial is not enough to justify award of interest on debt. The general principle is that b interest is not payable or recoverable at common law on ordinary debt in the absence of the following situations– (a) contract, express or implied; or (b) some mercantile usage; or c (c) provision by statute.” The respondent in the lower court claimed pre-judgment interest on the principal loan it granted the appellant and led evidence as per form 917 attached to its affidavit in support, d which also shows that there was an express agreement between the parties to pay interest.

This evidence is unchallenged by the appellant. e The respondent is entitled to the pre-judgment interest claimed in my view, and I so hold; the second issue of the present appeal is therefore resolved against the appellant. The third issue formulated by the appellant is; whether the f learned trial Judge misapplied the principles in Macaulay v NAL Merchant Bank Ltd (1990) 4 NWLR (Part 144) 283 to the present case when he held that the appellant disclosed no defence to the action of the respondent in its affidavit g showing cause. Learned Counsel for the appellant based the said third issue on the argument that each case should be treated on its own merit and that the facts of the present case are not on all h fours with the facts of Macaulay v NAL Merchant Bank Ltd (supra). Learned Counsel argued further that a disparity existed in the pleadings of the respondent that was fatal to its application for summary judgment, in that the respondent i averred in its pleading that the appellant had deposited some money in the savings account it opened pursuant to the agreement the parties entered for the repayment of the loan granted to the appellant. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 191 a Learned Counsel for the appellant argued that the learned trial Judge should have inferred from the facts before the court that the respondent was only entitled to the balance of b the loan it granted the appellant without any interest (less the amount deposited by the respondent). In the interest of justice, I will restate the principles of Macaulay v NAL Merchant Bank Ltd (supra), on the c requirements of affidavit showing cause which the learned trial Judge relied upon in his ruling at pages 93 and 94 of the record of appeal:– “(a) condescend upon particulars and as far as possible, deal d specifically with the plaintiff’s claim and affidavit and state clearly and concisely what the defence is, and what facts are relied on as supporting it. (b) state whether the defence goes to the whole or part of the claim, and in the latter case specify the part. e (c) when the defence is that the defendant is not indebted to the plaintiff, state the grounds on which the defendant relied as showing that he is not indebted. A mere general denial that the defendant is not indebted will not suffice. f (d) where the affidavit states that the defendant is not indebted to the plaintiff in the amount claimed or any part thereof, state why the defendant is not so indebted and to state the real nature of the defence relied on. g (e) . . . (f) . . . (g) in all cases, give sufficient facts and particulars to show that there is a bona fide defence.” h To start with, I do not see why the requirements set out in the case above should not guide the learned trial Judge in doing justice to the facts of the case in this present appeal. I am of the candid view, that the case of Macaulay v NAL i Merchant Bank Ltd (1990) 4 NWLR (Part 144) 283 is elaborate and conclusive on the nature of defendant’s application showing cause and that the learned trial Judge was right to have applied the enumerated principles above at j the trial court.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 192 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The appellant in his affidavit showing cause admitted that a he applied for and was granted an overdraft of N180,000.00k as claimed by the respondent. The contention of the appellant in his affidavit was that he believed that the b said loan was interest free. The respondent has claimed for interest on the loan and led evidence as per form 917 attached to its affidavit in support of the motion for summary judgment in proof of its claim for interest. The c appellant did not challenge this evidence but made a general denial that it was unaware of any interest chargeable on the said loan, it therefore failed the test in Macaulay’s case. The appellant in his amended brief of argument stated that d the learned trial Judge ought to have deducted the amount shown by the respondent in its exhibit to have been paid by the appellant from the judgment sum. The appellant did not attach any exhibit to its affidavit showing cause but, relied e on exhibit two of the respondent. The facts and exhibits before the trial court discloses that the appellant opened a savings account with its creditor (the respondent) and saved some money therein in accordance f with the terms of the facility granted him. The appellant’s affidavit is silent on this issue, whether the respondent had exercised a lien on the said savings, neither did it prove that the amount claimed was not exclusive of the said savings. g The appellant also did not give sufficient fact/particulars to support his case as recommended in Macaulay’s case, he failed to attach any exhibit to its affidavit. Appellant made a sweeping general denial of the averments in the affidavit of h the respondent. I agree with the learned trial Judge that the affidavit showing cause did not “descend upon particulars” as required by law and it disclosed no defence to the claim of i the respondent. The third issue formulated by the appellant is also resolved against the appellant. The fourth and last issue formulated by the appellant in this appeal is whether the learned trial Judge erred, when he j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 193 a entered judgment in favour of the respondent in view of section 132 of the Evidence Act. The appellant in his submissions isolated the condition b that the appellant should pay one thousand naira every month in settlement of the loan granted him and argued that it could be deduced from that condition that the loan was tenured for 180 months/15 years. c This issue like the three above was unattended to in the affidavit showing cause at the lower court, nonetheless, in the interest of justice, I shall deal with it as though it were. d What agitates my mind most dramatically is whether the appellant intends for the Court to apply section 132 of the Evidence Act to only the piece of evidence he now relies upon and do selective justice or apply the law on broad e principles. Should the court misapply section 132 of the Evidence Act to exhibits “A1” and “B” in the interest of the appellant? I don’t think so. Exhibit “A1” is the appellant’s letter of application for f N180,000 loan addressed to the manager of the respondent, wherein the appellant undertook as follows: “. . . I promise to make a settlement within six months initially”. The appellant did not challenge this evidence at the trial g court and still does not challenge it in this Court but he urges this Court to hold that the trial court ought to have deduced that the action was premature from the condition that the appellant was supposed to pay one thousand naira per month h even when he failed to make this desperate inference in his affidavit showing cause. Exhibit “B” is form No. 3483 of the respondent, annexed to the affidavit in support of the motion for summary i judgment in proof of the averment that the respondent last serviced his savings account/repaid his debt, on 8 February, 1988, eight years before the respondent filed an action against the appellant, yet, the appellant urges the Court to j infer that the loan had not fallen due, when he had defected

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA 194 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) for eight years and failed to repay a loan he admits to have a obtained. The appellant has not challenged any of the exhibits pleaded by the respondent at the lower court and he did not b tender any exhibit for himself but, he urges the honourable Court to draw inferences from the exhibits tendered by the respondent wherever he believes such inference will be in his favour, if such inference were in the interest of justice, I c would have drawn it. In my vivid perusal of the record of appeal, only one term/tenor of loan is expressed, and it is the one quoted above in exhibit “A1” attached to the respondent’s affidavit d in support of motion for summary judgment; which is a term of six months. The facts of this present appeal brings to mind the recent comment of Ogbuagu, JSC in the Supreme Court decision of e Magit v University of Agriculture Markurdi (2005) 19 NWLR (Part 959) 211 at 250 paragraphs A – E; (2006) All FWLR (Part 298) 1313 on the need for Counsel to have confidence in the success of a case or appeal before f accepting it:– “Where a counsel finds and knows that there are no chances of his appeal succeeding, he should honorably throw in the trowel (sic) and think less of his fees and more of the fact that he is also an g officer in the temple of justice.” It would appear that the learned Counsel for the appellant would have aided justice if he advised his client to respect his agreement and pay back what he borrowed according to h the agreed terms of the loan, especially since the appellant agreed that he borrowed money from the respondent and has not paid back same. In the final analysis, I agree with the learned trial Judge i that the appellant’s affidavit showing cause disclosed no defence to the claims of the respondent. I affirm the judgment of the trial court, this appeal is bereft of any credibility in my consideration and I accordingly dismiss j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Denton-West JCA Agbabiaka v First Bank of Nigeria Plc 195 a same. Costs of N5,000.00k is hereby awarded to the respondent. b ADAMU JCA: I have read before now, the lead judgment of my learned brother, Denton-West, JCA just delivered. I agree with the reasons given and the conclusion reached in the said lead judgment which I hereby adopt as mine. Consequently, I find the appeal to be unmeritorious and c hereby dismiss it. I also award N5,000 costs in favour of the respondent and against the appellant.

GARBA JCA: From the Notice of Appeal dated 25/8/97 d containing the four (4) grounds set out in the lead judgment, the vital issues that require decision by this Court are:– (1) Whether the appellant was afforded a fair hearing before the lower court delivered the decision e appealed against, and (2) Whether the respondent had satisfied the conditions for and was entitled to a summary judgment under Order 10, rules 1(a), (b) and Order 11, rules (1) and f (2) of the High Court of Lagos State (Civil Procedure) Rules, 1972. I have observed that the four (4) issues formulated by the learned appellant’s Counsel in his brief of arguments were g almost a repetition of the grounds of appeal; word for word. So even though learned Counsel did not follow and comply with the now established practice of relating or identifying the issues formulated to the grounds of appeal, each of the h issues formulated relates to the corresponding number of the grounds of appeal. In effect therefore, the learned Counsel argued the grounds of appeal in the form of issues which he coined them into. i Learned Counsel for the respondent joined his learned friend in that defect by arguing the issues as formulated in the appellant’s brief. The general practice in this Court is that appeals are argued on issues formulated out of and not j on the grounds of appeal as appears to be the case here. See

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Garba JCA 196 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Okpokpo v Uko (1997) 11 NWLR (Part 527) 94; Oyejola v a Agboola (1995) 8 NWLR (Part 411) 88 and Macaulay v NAL Merchant Bank (1990) 4 NWLR (Part 144) 283. Where issues are mere repetition or replica of the grounds of appeal b from which they are supposed to have (sic) formulated or distilled, they become unspecific and verbose, liable to be discountenanced, Oruobu v Anekwe (1997) 5 NWLR (Part 506) 618, 630 – 1 and Onifade v Olayiwola (1990) 7 NWLR c (Part 161) 130 at 157. However since the Court has the power to formulate and/or reformulate issues from the grounds of appeal in order to determine the real complaint against the decision of the lower court, I find it expedient to raise the two (2) issues set out at the beginning of this d contribution. The first issue is on fair hearing. Due to the crucial and fundamental nature of the issue of fair hearing under our e Constitution, the courts have been consistent and quick to always hold that the absence of fair hearing in any judicial proceedings renders them null and void no matter how very well they were conducted. The judicial authorities on this f position of the law are legion and so replete in our law reports that they can confidently be said to be common knowledge now in our administration of justice system. To refresh the memory, they include Mohammed v Kano NA (1968) 1 All NLR 424; Elike v Nwankwola (1984) 12 SC g 301; Onajobi v Olanipekun (1985) 1 SC 156; Obodo v Olomu (1986) 3 NWLR (Part 59) 111; Famuroti v Agbeke (1991) 13 NWLR (Part 189) 1; Salu v Egeibon (1994) 6 NWLR (Part 348) 23; Kenon v Tekam (2001) FWLR (Part h 70) 1660; (2001) 14 NWLR (Part 732) 1; NDIC v Ifediegwu (2003) 1 NWLR (Part 800) 56 and Alsthom SA v Saraki (2005) All FWLR (Part 246) 1385. In the determination of the issue of fair hearing, this Court i would scrutinize the printed records of proceedings of the trial court carefully as compiled in the record of appeal in order to find out if the principle was complied with or breached in the conduct of such proceedings. In the present j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Garba JCA Agbabiaka v First Bank of Nigeria Plc 197 a appeal, the meat of the complaint by the appellant on the issue is that the trial court heard the respondent’s motion for summary judgment on a date the motion was fixed for b mention and in the absence of the appellant and his Counsel. It is good law that it is wrong for a court to hear and determine a matter or case on a date it was fixed for mention only. However the records of proceedings of the court below c does not bear out or support the complaint by the appellant that the respondent’s motion for judgment was fixed for mention only on 7/7/97. As demonstrated in the lead judgment and admitted by the learned Counsel for the d appellant at page 3 of his brief of argument, the said motion was fixed for hearing on 7/7/97 by the clerk or registrar of the lower court. Indeed, learned Counsel was quite aware of this fact but absented himself from the hearing on the ground that he was busy arguing another motion e before another court on the date and time. With ignominy therefore, the complaint and submissions that the motion was fixed for mention on 7/7/97 are unserious and therefore untenable. Furthermore, the said motion from the f record of appeal and admission of Counsel, had been mentioned at least three (3) times before 7/7/97. Specifically, it was adjourned to 14/5/97 for hearing but had to be adjourned to 7/7/97 for hearing because the learned g trial Judge was not available. It cannot therefore be correct and true for learned Counsel to say that a motion which was mentioned three (3) times previous, adjourned to 14/5/97 for hearing would be adjourned on that date to 7/7/97 for h mention. Judicial common sense, logic and normal or usual course of proceedings would not accept such a puerile contention. Appellant through Counsel was aware that the i respondent’s motion for summary judgment was adjourned to 7/7/97 for hearing and learned Counsel opted out of the hearing so to say or failed to utilise the opportunity absenting himself without excuse. Neither appellant nor j Counsel can now be heard to claim or complain of want or

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Garba JCA 198 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) denial of fair hearing in respect of the motion. Adeyemi v a Lan and Baker (2000) 7 NWLR (Part 663) 33; Omo v JSC (2000) FWLR (Part 20) 676; (2000) 12 NWLR (Part 682) 444 and MMS v Oteju (2005) All FWLR (Part 270) 1995; b (2005) 5 SC 55 at 63 and 70 – 71. For the above and the reasons given in the lead judgment, I agree that the appellant’s right to a fair hearing was not breached in the hearing of the respondent’s motion for c summary judgment and that this issue be resolved against the appellant.

The other issue raised is on the conditions for summary d judgment under the rules of the court below. Let me state that as a general principle under Order 10, rule (a) and (b) [now Order 11(1) and (2)] of the Rules, where in a notice to show cause to defend the action, a e defendant shows that he has a fair case for defence, or a reasonable ground for setting up a defence or even a fair probability that he has a defence, he ought to be given leave to defend the action. However the notice must show that the f grounds for asking to be heard are not frivolous and designed to delay the trial of the action. See Macgregor v NMB (1996) 2 SCNJ 72 at 82; Winlyn v NACB (2000) 8 NWLR (Part 594) 597; Eastern Plastics v Synco (WA) g (1999) 1 NWLR (Part 587) 456 and Aubergine Collections Ltd v Habib Nig Bank Ltd (2002) FWLR (Part 128) 1276; (2002) 4 NWLR (Part 757) 338. h The affidavit in support of the notice to show cause to defend should disclose and set out particulars as far as possible specifically dealing with the claim of the plaintiff and clearly state what the defence is. Accordingly a mere general denial of liability either for whole or part of the i claim without setting out the facts or grounds upon which the denial or defence is based should not suffice. John Holt and Co v Fajemirokun (1961) All NLR 492; Daniel v Samad (1997) 7 NWLR (Part 514) 673; Knightsbridge v Atamako j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Garba JCA Agbabiaka v First Bank of Nigeria Plc 199 a (2000) 2 NWLR (Part 645) 387 and Atagura v Gura (2005) 2 SC (Part 1) 101, 109 and 118 – 9. The appellant’s affidavit in support of the notice of b intention to defend the action against him, to be found at pages 44 – 46 of the record of appeal cannot seriously be said to contain details of facts that would support any legal defence for the appellant. The affidavit merely made a c general denial of knowledge that interest was to be charged on the loan received by appellant and liability to the respondent. The appellant had in paragraph 4 of the said affidavit admitted that he received the loan/overdraft d facility from the respondent. However, nowhere in the affidavit did the appellant state or aver that he had made any repayment of the facility to the respondent since he enjoyed it. It is therefore curious for the appellant to e deny liability for the facility only on the spurious claim that no interest was chargeable thereon. To grant the appellant leave to defend the action on the basis of the affidavit attached to the notice of intention to defend would f have been in flagrant disregard to the very “raison d’etre” ie, purpose and essence of the provisions of Orders 10 and 11 of the Rules of the Court below on summary judgment. The rules were meant to enable the court g to decide actions in which from the affidavit evidence before it no legally tenable defence on the merits was disclosed, expeditiously. The discretion given to the court in the rules is used in such cases to save precious time and h resource on the part of the court and expenses, in addition, on the part of the parties. The procedure therefore avoids delays and often frustration associated with full trials of such clear-cut cases. i The findings of the lower court that the appellant’s affidavit in support of his intention to defend did not disclose a defence on the merit to justify the grant of leave to defend, are unassailable. The appellant’s purported j defence was purely “moonshine”, insincere and a sham

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Garba JCA 200 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) intended to beguile both the lower court and respondent. I a agree with the lead judgment that this issue be and is hereby resolved against the appellant. In the final result, I too find no merits in the appeal and dismiss same in the terms set out b in the lead judgment. I adopt the order on costs. Appeal dismissed.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

Ogunlade v Federal Mortgage Bank of Nigeria Limited 201 a Ogunlade v Federal Mortgage Bank of Nigeria Ltd b COURT OF APPEAL, IBADAN DIVISION FABIYI, AUGIE, UDOM-AZOGU JJCA Date of Judgment: 16 MAY, 2006 Suit No.: CA/1/259/2001

Mortgage – Interest rate – Variation of rate – Irregular c notice served by mortgagee – Mortgagor not reacting – Effect Mortgage – Interest – Variation of rate – Right of d mortgagee Word and phrases – Waiver – Defined

Facts e This is an appeal against the judgment of Kolade, J delivered on 15 May, 1996 while sitting at the High Court of Justice, Ibadan, Oyo State of Nigeria. The appellant had an axe to grind with the first respondent f over a mortgage loan procured by him. He was propelled to initiate his action at the trial court. In paragraph 54 of the statement of claim, he put up a host of nine (9) claims against the respondents jointly and severally. The lone issue g that was contested before the lower court related to propriety or otherwise of variation in the rate of interest as charged by the first respondent. The claim concerning same, as contained in paragraph 54(5) of the statement of claim read h as follows:– “Declaration that the first defendant is not entitled to calculate interest at a rate over and above 9% agreed upon by the plaintiff and reflected in the deed of legal mortgage.” i The appellant testified before the trial court that in 1980, he applied for a loan from the first respondent to develop his property along Osungbekun Avenue, Agodi G.R.A., Ibadan. The first respondent granted him an initial loan of N65,000. j The letter approving the loan is exhibit “B”. As security, he

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

202 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) deposited his certificate of occupancy over which a a mortgage deed was executed. The same is exhibit “C”. He said according to exhibits “B” and “C”, the rate of interest was 8½%. He further testified that in 1981, he applied for an b additional loan. He was further granted N15,000. The letter of offer is exhibit “D”. A supplementary deed of legal mortgage dated 1 June, 1982 was executed between him and the first respondent. The same is exhibit “E”. He said he c later received some notices from the first respondent in respect of variation of interest rates. The notices are exhibits “F” – “F3”. Cross-examined, the appellant, as plaintiff at the trial d court, agreed that the loan was repayable by monthly installments. He said at the time of the sale of his property, he was in serious arrears. He agreed that exhibits “F” – “F3” are notices for increase in rate of interest. Two letters written e by him to the first defendant/respondent are exhibits “G” and “G1” respectively. Learned Counsel on both sides addressed the trial court on the claim touching solely on variation of interest rate. In his f considered judgment, the learned trial Judge found that the first respondent had the power to dictate the state of interest at different intervals as reserved in the acceptance of offer form and in paragraph 8 of the principal legal mortgage, g exhibit “C”, executed by the parties. He found that the right of the plaintiff as reserved in paragraph 8(e) of the said mortgage deed was to treat such notice received as a call for the repayment of the principal sum then due with interest: h the option to be notified to the first defendant bank within one month of the receipt of the notice. But since the plaintiff failed to exercise any of the options, he is deemed to abide by the rate of interest notified. He found that the first i defendant bank was entitled to the amount as stated on its account due and payable. The appellant felt unhappy with the stance posed by the learned trial Judge. He has appealed to the Court of Appeal. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

Ogunlade v Federal Mortgage Bank of Nigeria Limited 203 a In a bid to consider issue 1, it is apt to reproduce clause 8(b) and (e) of exhibit “C” which is the Deed of Legal Mortgage executed by the appellant and the first respondent, b provides (sic) as follows:– “8. The rate of interest payable on all money hereby secured shall be determined as follows– (a) . . . c (b) The Mortgage Bank may from time to time serve on the borrower not less than three months notice requiring payment of interest at an increased or reduced rate which shall be the rate of interest chargeable by the d Mortgage Bank at the date of the said notice on advances on new securities which the Directors of the Mortgage Bank consider to be of the same type or as falling under the same category as this security and the decision of the Mortgage Bank’s Board of Directors in e this Connection shall not be questioned on any account whatsoever. (c) . . . (d) . . . f (e) The borrower may at his option treat any such notice as is referred to in this clause as a notice requiring repayment of the principal money secured, but in that event he shall give notice in writing of such election to g the Mortgage Bank with (sic) one month of the service of the notice.”

Held – h 1. The Bank board was at liberty to fix its interest rate from time to time. 2. Having been served with irregular notices, the appellant had the option to treat same as requiring the repayment i of a known right, or such conduct as warrants an inference of the relinquishment of such right, the renunciation, repudiation, abandonment or surrender of some claim, right, privilege or of the opportunity to take j advantage of some defect, irregularity or wrong.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

204 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

3. Waiver is defined in Blacks Law Dictionary (5ed) page a 1417 as the intentional or voluntary relinquishment of a known right, or such conduct as warrants an inference of the relinquishment of such right: the renunciation, b repudiation, abandonment or surrender of some claim, right, privilege or of the opportunity to take advantage of some defect, irregularity or wrong. 4. The appellant admitted that he was in serious arrears of c non-repayment of monthly installments. He can hardly be heard to complain of irregular notices of late. Equity will not allow the appellant to benefit on the terms of contract which he was constantly breaching. As an d indolent party in the agreement, equity will not come to his assistance. Equity means equality. 5. Where the terms of the legal mortgage signed by the appellant contains a clause which stipulates that the bank e may from time to time serve on the borrower not less than three months’ notice requiring payment of interest “at an increased or reduced rate”, and the appellant was served with illegal notice, where the appellant did not f take any step to reverse the situation, he is deemed to have waived his right to protest. 6. It must however be acknowledged that the prevailing banking practice as contained in the Central Bank of g Nigeria Guidelines and by section 14(1)(c) of the Federal Mortgage Bank Decree No. 7 of 1977, the respondent was at liberty to vary the interest rate from time to time. h Appeal succeeding in part.

Cases referred to in the judgment i Nigerian Ariori v Elemo (1983) 1 SC 13; (1983) 1 SCNLR 1 Artra Industries Nig Ltd v NBCI (1998) 4 NWLR (Part 546) 357 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

Ogunlade v Federal Mortgage Bank of Nigeria Limited 205 a Ayalogu v Agu (2002) 3 NWLR (Part 753) 168 Babatunde Ajayi v Texaco (Nig) Ltd (1978) 9–10 SC 1 Bakare v LSCSC (1992) 8 NWLR (Part 262) 641 b Edebiri v Edebiri (1997) 4 NWLR (Part 498) 165 Egonu v Egonu (1978) 11–12 SC 111 Ekpenvong v Nyong (1975) 2 SC 71 c Eravadodoke v University of Benin Teaching Hospital Management Board (1993) 2 NWLR (Part 277) 590 FATB v Ezegbu (1993) 6 NWLR (Part 297) 1 d Katsina Local Authority v Makudawa (1971) NSCC 119; (1971) 1 NMLR 100 Kudu v Aliyu (1992) 3 NWLR (Part 231) 615 e Macaulay v NAL Merchant Bank (1990) 4 NWLR (Part 144) 283 Mohammed v Kano Native Authority (1968) 1 All NLR 424 NBCI v Standard (Nig) Eng Co Ltd (2002) 8 NWLR (Part f 768) 104 Ndulue v Ibezim (2002) 12 NWLR (Part 780) 139 Nigerian Housing Development Society and another v g Mumuni (1977) 1 NSCC 65 Nneji v Chukwu (1988) 3 NWLR (Part 78) 184 Nnonye v Anjiechie (2005) 2 NWLR (Part 910) 623 Ogun v Asemah (2002) 4 NWLR (Part 756) 208 h Okoya v Santilli and others (1990) 2 NWLR (Part 131) 172 Olatunde v OAU (1998) 5 NWLR (Part 549) 178 UBN Ltd v Umeh and Sons Ltd (1996) 3 NWLR (Part 426) i 565 UBN Plc v Jeric (Nig) Ltd (1998) 2 NWLR (Part 536) 63 UBN v Nwaokolo (1995) 6 NWLR (Part 400) 127 j UBN v Ozigi (1994) 3 NWLR (Part 333) 385

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

206 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

UBN v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150 a Western Steel Works Ltd v Iron and Steel Workers Union (1986) 3 NWLR (Part 30) 617 b Foreign Atlas Life Ins Co. v Shrimsher 179 OKL 643, 66 p.2d 944 Mcfoy v UAC Ltd [1961] 3 All ER 1169; (1962) AC 152 c Nigerian statutes referred to in the judgment Evidence Act, section 131(1) Federal Mortgage Bank Decree No. 7 of 1977, section d 14(1)(c) High Court Law (Cap. 46) Laws of Oyo State of Nigeria, section 16 e Books referred to in the judgment Black’s Law Dictionary (5ed) page 1417 Halsbury’s Laws of England (3ed) Volume 14 paragraph 1175 f Counsel For the appellant: Afolabi (with him Ajayi and Ojo) For the respondent: Ogunyemi g

Judgment FABIYI JCA: (Delivering the lead judgment) This is an appeal against the judgment of Kolade, J delivered on 15 h May, 1996 while sitting at the High Court of Justice, Ibadan, Oyo State of Nigeria. The appellant had an axe to grind with the first respondent over a mortgage loan procured by him. He was propelled to i initiate his action at the trial court. In paragraph 54 of the statement of claim, he put up a host of nine (9) claims against the respondents jointly and severally. The lone issue that was contested before the lower Court relates to j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA Ogunlade v Federal Mortgage Bank of Nigeria Limited 207 a propriety or otherwise of variation in the rate of interest as charged by the first respondent. The claim concerning same, as contained in paragraph 54(5) of the statement of claim, b reads as follows:– “Declaration that the first defendant is not entitled to calculate interest at a rate over and above 9% agreed upon by the plaintiff and reflected in the deed of legal mortgage.” c The appellant testified before the trial court that in 1980, he applied for a loan from the first respondent to develop his property along Osungbekun Avenue, Agodi G.R.A., Ibadan. The first respondent granted him an initial loan of N65,000. d The letter approving the loan is exhibit “B”. As security, he deposited his certificate of occupancy over which a mortgage deed was executed. The same is exhibit “C”. He said according to exhibits “B” and “C”, the rate of interest was 8½%. He further testified that in 1981, he applied for an e additional loan. He was further granted N15,000. The letter of offer is exhibit “D”. A supplementary deed of legal mortgage dated 1 June, 1982 was executed between him and the first respondent. The same is exhibit “E”. He said he f later received some notices from the first respondent in respect of variation of interest rates. The notices are exhibits “F” – “F3”. Cross-examined, the appellant, as plaintiff at the trial g court, agreed that the loan was repayable by monthly installments. He said at the time of the sale of his property, he was in serious arrears. He agreed that exhibits “F” – “F3” are notices for increase in rate of interest. Two letters written h by him to the first defendant/respondent are exhibits “G” and “G1” respectively. DW1, a mortgage manager with the first defendant/ respondent identified exhibits “B” and “D” the offer forms i in respect of the loans granted to the plaintiff. He tendered the acceptance forms signed by the plaintiff. They are exhibits “H” and “H1”. He confirmed exhibits “C” and “E” as the deeds of legal mortgage on the loans advanced. He j said exhibits “F” – “F3” are notices served on the plaintiff

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA 208 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) varying interest rates. Exhibits “G” and “G1” are the letters a written by the plaintiff to the first defendant bank in 1967 and 1988. Learned Counsel on both sides addressed the trial court on b the claim touching solely on variation of interest rate. In his considered judgment, the learned trial Judge found that the first respondent had the power to dictate the rate of interest at different intervals as reserved in the acceptance of offer c form and in paragraph 8 of the principal legal mortgage exhibit “C” executed by the parties. He found that the right of the plaintiff as reserved in paragraph 8(e) of the said mortgage deed is to treat any such notice received as a call d for the repayment of the principal sum then due with interest; the option to be notified to the first defendant bank within one month of the receipt of the notice. But since the plaintiff failed to exercise any of the options, he is deemed e to abide by the rate of interest notified. He found that the first defendant bank was entitled to the amount as stated on its account due and payable. The appellant felt unhappy with the stance posed by the f learned trial Judge. He has appealed to this court. The original notice of appeal which carries six grounds of appeal was filed on 10/7/96. On 26/3/03, the court granted the appellant leave to substitute same with an amended notice of g appeal which carries seven (7) grounds of appeal. On 7/3/06, when the appeal fell due for hearing, learned Counsel for the appellant adopted and relied on the appellant’s brief of argument and urged that the appeal be h allowed. Three issues couched for the determination of the appeal read as follows:– “(1) Whether having regard to the conditions set out in the deed of legal mortgage, it can be said that the defendant complied i with those conditions in increasing the interest, and if not, what is the effect of such unlawful increment? (2) Whether the learned trial Judge was not in error in resorting to extrinsic evidence to interpret clear and unambiguous terms of the mortgage deed. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA Ogunlade v Federal Mortgage Bank of Nigeria Limited 209 a (3) Whether the trial court can rightly pronounce on a relief not claimed before it.” Learned Counsel for the respondents also relied on the brief b of argument filed by him and urged that the appeal be dismissed. He adopted the issues formulated for determination by the appellant. Arguing issue 1, Senior Counsel for the appellant c submitted that provisions of clause 8(b) of exhibit “C” require that an increment in the rate of interest should not come into effect until after three months have lapsed after the notification. He felt that the only logical interpretation d that can he placed on clause 8(b) of exhibit “C” is that three months’ notice must he given to the borrower by the bank before any interest payable on loan granted can be varied. He felt that notices in exhibits “F” – “F3” are grossly e improper and insufficient and thereby defeat the purpose that the clause was meant to serve which was to afford the customer an opportunity to decide either to accept the proposed increase or pay off the balance of the loan. He f referred to UBN v Ozigi (1994) 3 NWLR (Part 333) 385; UBN v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150; UBN v Nwaokolo (1995) 6 NWLR (Part 400) 127. Senior Counsel felt that exhibits “F”–“F3” were g irregularly issued retrospectively and applied to the principal sum and such hampered the appellant’s right of option as contemplated by clause 8(3) of exhibit “C”. He felt that the notices are incompetent, null and void and h cannot validate any action taken by the first respondent on account of those notices. He opined that as the notices are void, any interest charged on such notices is also void as one cannot put something upon nothing and expect it to stand. i He cited Mcfoy v UAC Ltd [1961] 3 All ER 1169. Senior Counsel felt that the indebtedness of the appellant was not ascertained having regard to the “contamination” of the principal sum and the “illegal” interest charged. He cited j Olatunde v OAU (1998) 5 NWLR (Part 549) 178; Artra

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA 210 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Industries Nig Ltd v NBCI (1998) 4 NWLR (Part 546) 357; a UBN Ltd v Umeh and Sons Ltd (1996) 3 NWLR (Part 426) 565. He felt that the first respondent cannot calculate interest on a rate over and above 9% agreed upon as reflected in b clause 8(b) of exhibit “C”. Learned Counsel for the respondents submitted that exhibits “F”–“F3” which are notices served as provided by clause 8(b) of exhibit “C” were at all material times c effective. He cited the cases of UBN v Sax (Nig) Ltd (supra) and UBA Ltd v Ozigi (supra). He referred to section 14(1)(c) of the Federal Mortgage Bank Decree No. 7 of 1977 which granted the first respondent the liberty to grant credit d facilities at such interest rates and upon terms as may he determined by the Board. Learned Counsel submitted that the appellant did not produce or tender any statement of account showing at what e point in time the new rates were charged into his account. He felt that the first respondent was at liberty to vary interest rate and that exhibits “F”–“F3” are valid and acts issued in accordance with clause 8(b) of exhibit “C”. He opined that f the dates indicated in the said exhibits, being dates requiring the payment of the increased rate of interest, are not void but irregular. He referred to Mcfoy v UAC (supra) at page 1173. Learned Counsel maintained that the appellant who g admitted that he was in “serious arrears” of non-payment of monthly installment cannot complain of irregular notices. He cited Nigerian Housing Development Society and another v Mumuni (1977) 1 NSCC 65 at page 72. He h submitted that equity will not allow the appellant to benefit on the terms of contract that he was constantly breaching. Equity will not aid an indolent party to an agreement; he submitted. i Learned Counsel submitted that the appellant waived the irregularities in the notices served on him when he failed to exercise the option provided in clause 8(e) of exhibit “C”. He referred to the cases of Kudu v Aliyu (1992) 3 NWLR j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA Ogunlade v Federal Mortgage Bank of Nigeria Limited 211 a (Part 231) 615 at 635; Bakare v LSCSC (1992) 8 NWLR (Part 262) 641 at page 701. Learned Counsel felt that by the provision of clause 8(b), the first respondent has the liberty b to increase or reduce the rate of interest and same does not envisage that exhibits “F”–“F3” should be given as a condition precedent to the liberty on power of fixing a higher or lower rate of interest. He opined that what clause c 8(b) of exhibit “C” envisages is that the application of higher rate of interest will be used in calculating interest chargeable into the account of the customer until the expiration of not less than three months from the date of the notice served on the customer requiring payment of interest d at increased or reduced rate. In a bid to consider issue 1, it is apt to reproduce clause 8(b) and (e) of exhibit “C” which is the deed of legal mortgage executed by the appellant and the first respondent. e It provides as follows:– “8. The rate of interest payable on all money hereby secured shall be determined as follows– (a) . . . f (b) The Mortgage Bank may from time to time serve on the borrower not less than three months notice requiring payment of interest at an increased or reduced rate which shall be the rate of interest chargeable by the g Mortgage Bank at the date of the said notice on advances on new securities which the Directors of the Mortgage Bank consider to be of the same type or as falling under the same category as this security and the decision of the Mortgage Bank’s Board of Directors in h this connection shall not be questioned on any account whatsoever. (c) . . . (d) . . . i (e) The borrower may at his option treat any such notice as is referred to in this clause as a notice requiring repayment of the principal money secured, but in that event he shall give notice in writing of such election to the Mortgage Bank with (sic) one month of the service j of the notice upon him.”

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA 212 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

From the provision of clause 8(b) of exhibit “C” reproduced a above, the power of the first respondent to serve notice requiring payment of interest at an increased or reduced rate is not in doubt. The first respondent is at liberty to so act. In b real substance, exhibits “F”–“F3” are notices served on the appellant as provided by clause 8(b) of exhibit “C”. Their effect remains undoubted. The bank board was at liberty to fix its interest rate from time to time. This view is supported c by the Supreme Court decisions in UBN Ltd v Ozigi (supra) and UBN Ltd v Sax (Nig) Ltd (supra) at page 173. Both Counsel for the parties agree that the dates indicated in exhibits “F”–“F1” make notices therein improper. The d exhibits appear irregular. I agree that the exhibits are irregular but they are not void. They are not nullities. They are good until avoided. Refer to Mcfoy v UAC Ltd (supra), (1962) AC 152. If an act is only voidable, then it is not e automatically void. It is only an irregularity which may be waived. It is not to be avoided unless something is done to avoid it. Having been served with irregular notices, the appellant f had the option to treat same as requiring the repayment of the principal money secured. But he reneged in that direction. It occurs to me that the appellant waived his right to protest the irregular notices served on him. g Waiver is defined in Black’s Law Dictionary (5ed) page 1417 as the intentional or voluntary relinquishment of a known right, or such conduct as warrants an inference of the relinquishment of such right; the renunciation, repudiation, h abandonment or surrender of some claim, right, privilege or of the opportunity to take advantage of some defect, irregularity or wrong. Atlas Life Ins Co. v Shrimsher 179 OKL 643, 66 p.2d 944, 948. Refer also to Ariori v Elemo i (1983) 1 SC 13; (1983) 1 SCNLR 1. Irregularity can be waived. If the beneficiary fails to object, he is deemed to have waived his right. See Katsina Local Authority v Makudawa (1971) NSCC 119 at 124; j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA Ogunlade v Federal Mortgage Bank of Nigeria Limited 213 a (1971) 1 NMLR 100; Nnonye v Anyichie (2005) 2 NWLR (Part 910) 623 at 647. Undoubtedly, the appellant waived the irregularities in notices served on him. See Kudu v Aliyu b (supra) at page 635; Bakare v LSCSC (supra). Apart from the above, the appellant admitted that he was in serious arrears of non-repayment of monthly installment. He can hardly be heard to complain of irregular notices of c late. I agree with the respondents’ Counsel that equity will not allow the appellant to benefit on the terms of contract which he was constantly breaching. As an indolent party in the agreement equity will not come to his assistance. Equity d means equality. See NHDS and another v Mumuni (supra) which is in point. In short, issue 1 is hereby resolved against the appellant without any equivocation. e On issue 2, Senior Counsel for the appellant submitted that exhibits “H” and “H1” – letters of acceptance do not form part of the terms of exhibit “C” – mortgage deed which is the only legally cognizable document governing the f relationship between the appellant and the first respondent. As preliminary correspondence, they do not form part of exhibit “C” executed as representing the terms and conditions governing the relationship of the appellant and g the first respondent bank. He referred to UBN v Ozigi (supra) at page 400; Macaulay v NAL Merchant Bank (1990) 4 NWLR (Part 144) 283 and section 131(1) of the Evidence Act. Senior Counsel felt that the conclusion of the h learned trial Judge that the power of the first defendant bank to dictate the rate of interest at different intervals has been reserved both in the acceptance of offer forms and in paragraph 8 of the principal legal mortgage – exhibit “C” i executed by the parties’ is wrong. He contended that exhibits “H” and “H1” cannot be used as extrinsic evidence to vary or add to the terms contained in exhibit “C”. Learned Counsel for the respondents submitted that j exhibits “H” and “H1” were not tendered to control or vary

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA 214 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) the provision of clause 8(b) of exhibit “C” but in support of a the said clause. He felt that reference to exhibits “H” and “H1” did not produce an injustice to the appellant. To my mind, there is no big deal in this issue. Exhibits b “H” and “H”–“H1” were not used to vary or contradict clause 8(b) of exhibit “C”. Exhibits “H” and “H1” serve as reminders to the appellant that from the inception of his relationship with the respondent he was aware that the first c respondent reserved the power to dictate rate of interest from time to time. Exhibits “H” and, “H1” were not used in interpreting the terms contained in exhibit “C”. They were employed to support the terms of agreement expressed in d clause 8(b) of exhibit “C”. The contents of both are similar and any imagined distinction may be likened to a difference between six and half a dozen. I accordingly resolve issue 2 against the appellant without e much ado. Issue No. 3 is whether the trial court can rightly pronounce on a relief not claimed before it. f Senior Counsel submitted that the state of pleadings and evidence adduced does not suggest a legally cognizable relief entitled to by the first defendant bank and same cannot depend on the appellant’s claim before the lower court. He cited UBN Plc v Jeric (Nig) Ltd (1998) 2 NWLR (Part 536) g 63. Senior Counsel observed that the first defendant did not file any counter-claim. He felt that the relief granted to the first defendant bank is incompetent and that the learned trial Judge lacked jurisdiction to grant same. He cited Western h Steel Works Ltd v Iron and Steel Workers Union (1986) 3 NWLR (Part 30) 617 at 625. Learned Counsel for the respondents submitted that a court has no power to award to a party that which he did not i claim. He cited Edebiri v Edebiri (1997) 4 NWLR (Part 498) 165 at 176; Ekpenvong v Nyong (1975) 2 SC 71. Senior counsel further pointed it out that although a court must not grant to a party a relief not claimed by him, it has the power j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA Ogunlade v Federal Mortgage Bank of Nigeria Limited 215 a to grant a relief which is incidental and necessary even if such has not been expressly claimed. He cited Eravadodoke v University of Benin Teaching Hospital Management Board b (1993) 2 NWLR (Part 277) 590 at page 599. He also referred to section 16 of the High Court Law (Cap. 46) Laws of Oyo State of Nigeria. Learned Counsel maintained that the conclusion of the c trial Judge that the first defendant is entitled to the amount as stated on its account as “due and payable” did not amount to a grant of relief that was not claimed. He cited FATB v Ezegbu (1993) 6 NWLR (Part 297) 1 at 15. d It is clear that a court should not award that which was not claimed by a party. This is because a court is not a charitable organisation. Refer to Egonu v Egonu (1978) 11–12 SC 111 at 113; Babatunde Ajayi v Texaco (Nig) Ltd (1978) 9–10 SC e 1 at 27; Ekpenvong v Nyong (supra) at page 80; Okoya v Santilli and others (1990) 2 NWLR (Part 131) 172 at 205. However, an order which appears incidental and necessary for a proper and just determination of a cause f could be made though not claimed by a party. Refer to Nneji v Chukwu (1988) 3 NWLR (Part 78) 184 at 208; FATB v Ezegbu (supra). The court in such a situation must not grant more than what the party claims. g The first respondent herein, as first defendant at the lower court, did not counter-claim for a declaration that it is entitled to a specified sum stated in the appellant’s account. There is no iota of evidence on any sum outstanding. The h conclusion of the trial court that the first defendant is entitled to the amount as stated on its account as “due and payable” was made in the air and at large. If a consequential order must be made, it must be precise and capable of being i executed without acrimony. The declaration appears incompetent. The learned trial Judge lacked jurisdiction to grant same. The case of Western Steel Works Ltd v Iron Steel Workers Union (supra) is of moment. The issue is j resolved in favour of the appellant. The trial Judge’s order

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA 216 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) that the first defendant is entitled to the amount as stated on a its account as “due and payable” is hereby set aside. In conclusion the appeal savours of merit in respect of issue No. 3. The main decision of the learned trial Judge that b the first respondent has power to vary interest rate at different intervals as reserved in clause 8(b) of exhibit “C” executed by the parties remain inviolate. I affirm same. In the prevailing circumstance of this appeal, I make no order c on costs. AUGIE JCA: I have read in draft the lead judgment just delivered by my learned brother, Fabiyi, JCA and I agree with his reasoning and conclusions. Courts of law are legal d institutions for the adjudication of matters and award of relief or reliefs duly sought by the parties in the litigation process and it is trite law that a court of law cannot give and should never award a relief that is not sought or pleaded by a e party. See NBCI v Standard (Nig) Eng Co Ltd (2002) 8 NWLR (Part 768) 104; Ndulue v Ibezim (2002) 12 NWLR (Part 780) 139; Ogun v Asemah (2002) 4 NWLR (Part 756) 208 and Ayalogu v Agu (2002) 3 NWLR (Part 753) 168. In f this case, the first respondent as first defendant did not seek or claim the declaration made by the lower court that it “is entitled to the amount as stated on its account as due and payable” and contrary to the arguments proffered by learned g Counsel for the respondents, the said declaration is a long mile away from being a consequential order, and I also set it aside. Be that as it may, the decision of the lower court that the first respondent has power to vary interest rate at different intervals cannot be faulted and I do hereby affirm h same. I also make no order as to costs.

UDOM-AZOGU JCA: I have had a preview of the judgment just delivered by my learned brother, John Afolabi Fabiyi, i JCA. I completely agree with the reasoning and conclusion. That equity does not aid the indolent is now trite. Where the terms of the legal mortgage signed by the appellant contains a clause which stipulates that the bank may from j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Udom-Azogu JCA Ogunlade v Federal Mortgage Bank of Nigeria Limited 217 a time to time serve on the borrower not less than three months’ notice requiring payment of interest “at an increased or reduced rate”, and the appellant was served b with illegal notice. Where the appellant did not take any step to reverse the situation, he is deemed to have waived his right to protest. Waiver is the intentional, voluntary surrender or c relinquishment of a known privilege and or right. It implies a dispensation or abandonment by the party waiving of a right or privilege which at his option he could have insisted upon. See Halsbury’s Laws of England (3ed) Volume 14 d paragraph 1175. See also Mohammed v Kano Native Authority (1968) 1 All NLR 424. On the issue of variation it is admitted that parties are bound by the agreement signed with the mortgage bank. It e must however be acknowledged that the prevailing banking practice as contained in the Central Bank of Nigeria Guidelines and by section 14(1)(c) of the Federal Mortgage Bank Decree No. 7 of 1977, the respondent was at liberty to f vary the interest rate from time to time. Having waived his right by his indolence, the appellant is estopped from complaining. In the circumstance, I agree with the lead judgment that the appeal is meritorious in respect of issue 3. I also affirm the judgment of the court below to the effect g that the first respondent has power to vary interest rate at different intervals as provided for in clause 8(b) of exhibit “C”. I abide by the order as to costs. Appeal allowed in part.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

218 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

a Integrated Timber and Plywood Products Ltd v UBN Plc b SUPREME COURT OF NIGERIA BELGORE, KALGO, TOBI, OGUNTADE, OGBUAGU JJSC Date of Judgment: 19 JULY, 2006 Suit No.: SC 342/2001

Banking – Banker/customer relationship – How formed – c Nature of – Jurisdiction of Federal and State High Courts Banking – Customer – Who is Jurisdiction – Federal High Court – Simple contract – Not d that of Federal High Court Word and phrases – Customer – Who is

Facts e This is an appeal by the plaintiff/appellant against the judgment of the Court of Appeal, Benin division, delivered on 12 July, 2000 setting aside the ruling of Abutu, J of the Federal High Court and ordering the transfer of the f substantive suit to the Delta State High Court for hearing and determination. The appellant claimed in the Writ of Summons taken out on 10 October, 1996 as follows:– g “The defendant which carries on banking business nationwide has offices in Benin within the jurisdiction of this Honourable Court. Sometime in 1990, the defendant while carrying on its banking business forwarded to the plaintiff an irrevocable documentary h letter of Credit No. K16167/65626 established in Belgium and by a letter dated 12/10/90 the defendant advices and confirmed the authenticity of the letter of credit. Pursuant to the defendant advices and confirmation the plaintiff adopted the letter of credit i and exported Iroko furniture components worth M28527 to one C.J.E DUB 105 STOCKMANIVS in Belgium. Inspite of repeated demand (sic) plaintiff has received no payment for its goods. Wherefore the plaintiff claim against the defendant the sum of N120,000,000.00 (One Hundred and Twenty Million Naira) as j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 219 a special and general damages for breach of contract and or negligent Misstatement.”(Italics mine.) The appellant later filed a statement of claim on 18 b February, 1997. The respondent upon being served with the same filed a motion on notice on 24 March, 1997, praying for:– “An order dismissing and or striking out the suit on the grounds c (sic) that the court lacks jurisdiction to entertain the suit.” The learned trial Judge, after hearing arguments from both learned Counsel for the parties, in a considered ruling delivered on 7 July, 1997, dismissed the said motion, and d held that the suit was within the admiralty jurisdiction of the court. Said he in his conclusion:– “In the result I hold that the suit is one within the admiralty jurisdiction of this court. The court therefore has jurisdiction to e entertain the suit. The objection is overruled and the motion is hereby dismissed.” Dissatisfied, the respondent successfully appealed to the Court of Appeal (hereinafter called “the court below”) f which on 12 July, 2000 unanimously allowed the appeal. The appellant being aggrieved by the said decision has now appealed to the Supreme Court. g Held – 1. The status of a bank when dealing with another bank in relation to earning interest on a deposit made by the h former bank is that of customer. In that case or circumstance, where a dispute arises from such transaction, then the relationship of individual customer and banker is established. Then of course, such dispute i or any dispute arising from that transaction is triable in the State High Court as well as in the Federal High Court. 2. The customer and banker relationship is certainly j contractual.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

220 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

3. In a simple contact (as in the instant case between the a parties), it is the High Court that has the jurisdiction to entertain and determine it. 4. According to Black’s Law Dictionary (6ed) a customer is b described in relation to a bank is as follows– “In banking, any person having an account with a bank or for whom a bank has agreed to collect items and includes a bank carrying an account with another bank.” c Appeal dismissed.

Cases referred to in the judgment d Nigerian Adeyemi v Opeyori (1976) 9 – 10 SC 31 Administrator General and Public Trustee v Ilobi (1972) 2 ECSLR 587 e Afribank (Nig) Plc v KCG (Nig) Ltd (2001) 8 NWLR (Part 714) 87; (2001) FWLR (Part 67) 1042 CA African Newspapers of Nigeria v FRN (1985) 2 NWLR (Part 6) 137 f Alraine Shipping (Nig) Ltd v Endura Auto Chemicals (2001) 12 NWLR (Part 728) 759 Aromolaran v Oladele (1990) 7 NWLR (Part 162) 359 g Arowolo v Akapo (2003) 8 NWLR (Part 823) 451 Ayeni v Sowemimo (1982) 5 SC 60 Bi Zee Bee Hotels Ltd v Allied Bank (Nig) Ltd (1996) 8 NWLR (Part 465) 176 h Brawal Shipping (Nig) Ltd v Extraction Commodity Services Ltd (2001) 14 NWLR (Part 732) 172 Crownstar and Co Ltd v The Vessel MV Valip (2000) 1 i NWLR (Part 639) 37 Ebiteh v Obiki (1992) 5 NWLR (Part 243) 599 Enigbokan v American Int Insurance Co Ltd (1994) 6 NWLR (Part 348) 1; (1994) 6 SCNJ 168 j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 221 a Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333; (1999) 2 SCNJ 57 Jatau v Ahmed (2003) 4 NWLR (Part 811) 498; (2003) 1 b SCNJ 382; (2003) 4 NWLR (Part 811) 498 Lahan v Lajoyetan (1972) NSCC 460; (1972) 6 SC 190 Ndayako v Dantoro (2004) 5 SCNJ 152; (2004) 13 NWLR c (Part 889) 187 NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107 Nigerian National Supply Co Ltd v Sabana Ltd (1987) 2 d NWLR (Part 56) 285 Nta v Anigbo (1972) 5 SC 156 Omisade v Akande (1987) 2 NWLR (Part 55) 158 e Omosowan v Chiedozie (1998) 9 NWLR (Part 566) 477 Onitolo v Bello (1958) 3 FSC 53; (1958) SCNLR 49 Pacers Multi Dynamic Ltd v MV “Dancing Sisters” (2000) 3 NWLR (Part 648) 241 f Savannah Bank (Nig) Ltd v Pan Atlantic Shipping and Transport Agencies Ltd (1987) 1 NWLR (Part 49) 212 Shell Petroleum Co (Nig) Ltd v Isaiah (1997) 6 NWLR (Part g 508) 236 Sowemimo v Somisi (1982) 1 All NLR (Part 1) 49 Tigris International Corp v Ege Shipping and Trading Industry (1999) 6 NWLR (Part 608) 701 h Tukur v Gov, Gongola State (1989) 4 NWLR (Part 117) 517; (1989) 9 SCNJ 1 UBA v Achoru (1990) 6 NWLR (Part 156) 254; (1990) 10 i SCNJ 17

Nigerian statutes referred to in the judgment Admiralty Jurisdiction Decree No. 59 of 1991 sections j l(1)(h) and 19

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

222 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Constitution (Suspension and Modification) Decree No. 107 a of 1993, section 1(3) Constitution of the Federal Republic of Nigeria, 1979, sections 230(1)(d) and 236 b Federal High Court Act (Cap 134) Laws of the Federation of Nigeria, 1990, section 24

Foreign statute referred to in the judgment c English Administration of Justice Act, 1956

Book referred to in the judgment Black’s Law Dictionary (6ed) page 386 d

Counsel For the appellant: Ajuyah e For the respondent: Esosuakpo

Judgment OGBUAGU JSC: (Delivering the lead judgment) This is an appeal by the plaintiff/appellant against the judgment of the f Court of Appeal, Benin division, delivered on 12 July, 2000 setting aside the ruling of Abutu, J of the Federal High Court and ordering the transfer of the substantive suit to the Delta State High Court for hearing and determination. g The appellant claimed in the writ of summons taken out on 10 October, 1996, as follows:– “The defendant which carries on banking business nationwide has offices in Benin within the jurisdiction of this Honourable Court. h Sometime in 1990, the defendant while carrying on its banking business forwarded to the plaintiff an irrevocable documentary letter of Credit No. K16167/65626 established in Belgium and by a letter dated 12/10/90 the defendant advised and confirmed the i authenticity of the letter of credit. Pursuant to the defendant advices and confirmation the plaintiff adopted the letter of credit and exported Iroko furniture components worth M28527 to one C.J.E DUB 105 STOCKMANIVS in Belgium. Inspite of repeated demand (sic) plaintiff has received no payment for its goods. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 223 a Wherefore the plaintiff claim against the defendant the sum of N120,000,000.00 (One Hundred and Twenty Million Naira) as special and general damages for breach of contract and or negligent Misstatement.” (Italics mine.) b I note that the appellant, in reproducing the above claim in the brief of argument, “deliberately” or “inadvertently?” omitted the concluding words ie “for breach of contract and or negligent misstatement”. In the respondent’s brief, the c whole claim was correctly reproduced except the word “demand” which both parties typed as “demands”. The appellant later filed a statement of claim on 18 d February, 1997. The respondent upon being served with the same filed a motion on notice on 24 March, 1997, praying for:– “An order dismissing and or striking out the suit on the grounds (sic) that the court lacks jurisdiction to entertain the suit.” e The learned trial Judge, after hearing arguments from both learned Counsel for the parties, in a considered ruling delivered on 7 July, 1997, dismissed the said motion, and f held that the suit was/is one within the admiralty jurisdiction of the court. Said he in his conclusion:– “In the result I hold that the suit is one within the admiralty jurisdiction of this court. The court therefore has jurisdiction to entertain the suit. The objection is overruled and the motion is g hereby dismissed.” Dissatisfied, the respondent successfully appealed to the Court of Appeal (hereinafter called “the court below”) which on 12 July, 2000 unanimously allowed the appeal. h The appellant being aggrieved by the said decision has now appealed to this Court on two (2) grounds of appeal. Without their particulars, they read as follows:– i 1. “The learned Justices having rightly referred to the claim and statement of claim erred in law in holding– ‘Taking into consideration the two definition above, it cannot be disputed that the dispute that gave rise to this action falls within the confine of the relationship j between a bank and customer in which case, the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC 224 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

jurisdiction of the Federal High Court has been ousted a by the proviso to paragraph (d) of Section 230(1) of the 1979 Constitution as amended by Decree No. 107 of 1993’. b 2. The learned Justices erred in law when they held: ‘With the greatest respect to the learned trial Judge, I disagree with him, that Section l(1)(h) of the Admiralty Jurisdiction Decree No. 59 of 1991 has conferred c jurisdiction on the trial court when the said section ceases to have effect by virtue of the modification of the Constitution by Decree No. 107 of 1993. See Bi Zee Bee Hotels Limited v Allied Bank (Nigeria) Limited (1996) 8 NWLR (Part 465) 176.’” d The appellant has formulated one (1) issue for determination namely:– “Whether the learned Justices were right in holding that the e Federal High Court lacked the jurisdiction to entertain the claim of the plaintiff.” The respondent, has adopted the above issue. In my respectful view, what appears clear and plain to me f is that while the trial court held that the suit was one within the admiralty jurisdiction of that court, the court below held that the action falls within the confine of the relationship between a bank and customer in which case the jurisdiction g of the Federal High Court has/had been ousted by the proviso to paragraph (d) of section 230(1) of the 1979 Constitution as amended by Decree No. 107 of 1993. h The court below per Ba’aba, JCA at page 75 of the records stated inter alia as follows:– “With the greatest respects to the learned trial Judge, I disagree with him, that Section l(1)(h) of the Admiralty Jurisdiction Decree i No. 59 of 1991 has conferred jurisdiction on the trial court when the said section ceases to have effect by virtue of the modification of the Constitution by Decree No. 107 of 1993. See Bizze Bee Hotels Ltd v Allied Bank (Nig.) Ltd (1996) 8 NWLR (Part 465) 181.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 225 a In his concurring judgment, Akintan, JCA (as he then was), at page 77 of the records had this to say, inter alia:– “. . . I also agree that the plaintiff’s claim in the instant case could b not be said to be one covered by the admiralty jurisdiction of the Federal High Court. Infact, I believe that the claim has nothing to do with admiralty matters . . .”. The respondent has in its brief also submitted that the claim c of the appellant has nothing to do with admiralty matters. I too say so. This is because firstly, as rightly stated in the respondent’s brief, in the appellant’s statement of claim at page 8 of the records, (not in paragraph 13 as stated in the respondent’s brief as there is no paragraph 13 therein) the d claims of the appellant are as follows:– “(a) Special damages of DM28,527.70 being value of the Iroko Furniture component exported to Belgium under the L.C. No. K16167/65626 or the Naira equivalent of N1,478,279.80. e (b) Loss of earnings on investment of DM28,527.70 at the rate of 15% per annum at the Commercial Bank Savings rate of interest of 15% per annum for the period of January, 1991 to the day of judgment. f and/or (c) N60,000,000.00 as general damages for negligence.” As can be seen as rightly submitted in the respondent’s brief, the above claims have nothing to do with admiralty and are g not in any way making any attempt to enforce or enforcing the said letter of credit. Secondly, as reproduced and noted by me hereinabove, the sum of N60,000,000 (Sixty Million Naira) claimed in the h writ of summons were for “special and general damages for breach of contract and or negligent misstatement”. Yes, now that it is settled that a statement of claim supercedes the writ. See Lahan and others v Lajoyetan and i others (1972) NSCC 460 at 461; (1972) 6 SC 190; Nta v Anigbo (1972) 5 SC 156; Enigbokan v American International Insurance Co Ltd (1994) 6 NWLR (Part 348) 1 at 19; (1994) 6 SCNJ 168 and recently Arowolo v Akapo and j others (2003) 8 NWLR (Part 823) 451 at 469 – 470 CA

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC 226 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) citing several cases therein, just to mention but a few, the a court will then confine itself to the said claim in the statement of claim. Significantly and remarkably, in the appellant’s brief, paragraphs 4, 5, 6, 7 and 8 of the statement b of claim have been reproduced therein. In the respondent’s brief, paragraphs 4 and 5 of the said statement of claim have also been reproduced therein. The paragraphs read as follows:– c “4. Sometime in 1990, the plaintiff received through its bankers, the New Nigeria Bank Plc, a telex of an Irrevocable Documentary Letter of Credit No. 16167/65626 from the defendant which said letter of credit has as its applicant, C.I.E. DUBOIS STOCKMANNS of Belgium as the foreign d bank which purportedly issued same. The plaintiff shall found on a copy of the telex letter of credit for its full terms and effect. 5. By a letter reference IDC0090/90 dated 12/10/90 addressed e to the plaintiff said bankers, and a copy to the plaintiff, the defendant advised on and confirmed the authenticity of telex establishing the letter of credit and requested for the sum of N25.00 advising commission. The plaintiff upon receipt of a copy of the defendant’s letter paid the Commission of f N25.00 to the defendant with a N.N.B. Limited draft No. 602092 of 19/11/90 and acted on the defendant’s advice and confirmation by exporting Iroko furniture components to C.I.E. DUBOIS STOCKMANNS in Belgium between the 30 g November, 1990 and 30 December, 1990 (both days inclusive). The plaintiff shall found on NNB letter of 14/11/90, plaintiff’s letter of 21/11/90 addressed to the NNB Limited, Warri, plaintiff’s invoices Nos. 007, 008 and 009 for the export in the value of DM28,527.70 delivered to the h defendant. 6. By the terms of the letter of credit, the plaintiff’s drafts for the value of the goods were to be paid on presentation of the relevant shipping documents to the defendant which the i plaintiff duly submitted to the defendant and uptill (sic) now the plaintiff has received no draft or payment for the value of the goods exported under the said letter of credit. 7. At the time the defendant forwarded to the plaintiff the said letter of credit and the letter of confirmation dated 12/10/90, j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 227 a the defendant intended and it well knew or ought to have known that the plaintiff would rely on them and would be induced thereby to export its goods upon the terms contained therein. In the premises, the defendant was under a duty to b take care in the making of the said representation to the plaintiff so as to cause plaintiff any financial loss or damage. 8. Acting on the faith of the defendant’s representations and induced thereby, the plaintiff exported Iroko furniture c components in the value of DM28,527.70 to C.I.E. Dubios Stockmanns in Belgium and for which no payment has been received.” I agree with the submission of the learned Counsel for the d appellant in paragraphs 1-11 of the appellant’s brief that:– “The claim as endorsed on the Writ of Summons and further elaborated in the statement of claim remain the basis for determination whether the court has jurisdiction to entertain the e suit. See Adeyemi and others v Opeyori (1976) 1 N.M.L.R. 149 at 158.” Comment. The above however, does not detract from the settled law that a statement of claim supersedes the writ of f summons. Note. The case is also reported in (1976) 9 – 10 SC 31 at 51. See also the cases of Aromolaran and another v Oladele and others (1990) 7 NWLR (Part 162) 359 at 375 C.A. g citing the cases of Administrator General and Public Trustee v Asika Ilobi (1972) 2 ECSLR 587 at 593, and Onitola v Bello (1958) 3 FSC 53; (1958) SCNLR 49. See also the case of Ebiteh v Obiki (1992) 5 NWLR (Part 243) h 599 at 641 and many others. Thirdly, the averment in paragraph 4 of the statement of claim shows that the bankers of the appellants, as far as the Irrevocable Documentary Letter of Credit No. 16167/65626 i is concerned is/are New Nigeria Bank which forwarded the said letter of credit to the appellant. Fourthly, from the averment in paragraph 5 of the statement of claim, there was no transaction in respect of the j issuance of letter of credit between the appellant and the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC 228 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) respondent. The transaction between the appellant and the a respondent, I hold, was not even that of a banker and customer as was erroneously, with respect, held by the court below. What the appellant has stated from the averments, in b my respectful view, was the confirmation of the authenticity of the Telex establishing the letter of credit and not the letter of credit itself. Period! The payment of N25 (Twenty Five Naira) was for the said confirmation or in other words the c consideration paid by the appellant for the said confirmation. I repeat there was no other transaction of issuance of a letter of credit between the appellant and the respondent. Fifthly and lastly, the said confirmation for the d consideration or payment of N25 (Twenty Five Naira) amounts in my humble but firm views to a simple contract. I hold that the issue and argument on admiralty is completely and absolutely misconceived. As a matter of fact, the issue e does not arise. It is a non-issue in all the circumstances having regard to the claims of the appellant hereinabove reproduced by me. Let me therefore stress here and reproduce the principle f enunciated by this Court – per Obaseki, JSC which is now firmly settled in the case of Tukur v Government, Gongola State (1989) 4 NWLR (Part 117) 517 at 549; (1989) 9 SCNJ 1. It is as follows:– g “It is a fundamental principle that jurisdiction is determined by the plaintiff’s claim (Izenkwo (sic) v Nnadozie 14 W.A.C.A. 361 at 363 per Coussey, J.A. Adeyemi v Opayemi (sic) (1976) 9 – 10 S.C. 31 at 51). In other words, it is the claim before the court that has h to be looked at or examined to ascertain whether it comes within the jurisdiction conferred on the court. (See Western Steel Works v Iron and Steel Workers (1987) 1 NWLR (Part 49) 284). Judges have no duty and indeed no power to expand the jurisdiction i conferred on them, but they have a duty and indeed jurisdiction to expound the jurisdiction conferred on them. See the African Newspapers of Nigeria and others v The Federal Republic of Nigeria (1985) 1 All NLR 50 at 175, (1985) 2 NWLR (Part 6) at 137”. (Italics mine.) j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 229 a Assuming that the relationship between the appellant and the respondent is that of customer and banker (which is not conceded by me), the case of NDIC v Okem Enterprises Ltd b and another (2004) 10 NWLR (Part 880) 107; (2004) 4 SC (Part 11) 77 cited and relied on by the learned Counsel for the appellant as an additional authority in respect of his submissions in paragraph 2.02 of the appellant’s brief has c made it abundantly clear that the Federal High Court does not have exclusive jurisdiction in banking and customer/banker relationships. At least, the learned Counsel concedes this fact or the said decision of this Court. d Let me quickly state that the case of Federal Mortgage Bank of Nigeria v NDIC (Nigeria Deposit Insurance Corporation) (1999) 2 NWLR (Part 591) 333 at 362 363; (1999) 2 SCNJ 57 per Ogundare, JSC (of blessed memory), e dealt substantially with the issue of the status of banker/banker relationship. In other words, the status of a or one bank when dealing with another bank as a customer like a bank interested in earning interest from another bank f through say where that bank made a deposit in/with the other bank. In that case or circumstance, where a dispute arises from such transaction, then the relationship of individual customer and banker is established. Then of course, such dispute or any dispute arising from that g transaction is triable in the State High Court as well as in the Federal High Court. Said the learned Jurist:– h “. . . with respect to the learned counsel for the respondent, I do not share the view that the proviso in Section 230(1)(d) would not apply where in a customer/ banker relationship, the customer is a bank. To say that where there is a dispute between two banks, the i forum for resolution of the dispute is the Federal High is to read into Section 230(1)(d) what is not there. In the absence of any evidence to the contrary about the custom in the industry, I must hold that it is a simple customer/banker relationship which the proviso in Section 230(1)(d) exempts from the exclusive j jurisdiction of the Federal High Court.”

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC 230 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

As can be seen from the above discuss (sic), reliance on a these cases by the learned Counsel for the appellant is hopelessly with respect, and grossly misconceived. By no stretch of imagination are they relevant or applicable to the b simple contract transaction between the appellant and the respondent. The intendment of the proviso to section 230(1)(d) of the Constitution of the Federal Republic of Nigeria, 1979 was certainly and surely to give concurrent c jurisdiction to both the Federal High Court and State High Court. If the Decree meant that it would include matters between an individual customer and his bank, it should have said so. The customer and banker relationship is certainly contractual. In the case of Bi Zee Bee Hotels Ltd v Allied d Bank (Nig) Ltd (1996) 8 NWLR (Part 465) 176 at 185 CA, the jurisdiction of the Federal High Court, was held to have been ousted. e In Afribank (Nig) Plc v KCG (Nig) Ltd (2001) FWLR (Part 67) 1042 CA; (2001) 8 NWLR (Part 714) 87. His Lordship, Ba’aba, JCA, Benin Division, departed from the decision in the instant appeal. With the greatest respect, the learned Justice was in effect reviewing the decision in Bi f Zee Bee Hotels Ltd v Allied Bank (Nig) Ltd (supra). In this wise, let me refer to the case of Jatau v Ahmed (2003) FWLR (Part 151) 1887 at 1896; (it is also reported in (2003) 1 SCNJ 382); (2003) 4 NWLR (Part 811) 498 also cited and g relied on by the respondent in its brief, where this Court per Kalgo, JSC frowned at the attitude of the Court of Appeal setting aside or reviewing its own decision in another division. It was/is stated that that court can do so only where h the decision is a nullity. The Court of Appeal as I know it is proudly known as “the court”. Coming back to the issue in this appeal, it is now firmly established that in a simple contract (as in the instant case i between the parties), it is the High Court and not the Federal High Court that has jurisdiction to entertain and determine it. See the case of Omosowan and 2 others v Chiedozie (1998) 9 NWLR (Part 566) 477 at 484 CA. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Ogbuagu JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 231 a I therefore hold that the court below was right, when it held that the Federal High Court lacked jurisdiction to entertain the appellant’s suit and consequently transferred it b to the Delta State High Court for hearing and determination. I however, hold that its reason for so holding was erroneous but yet it came to a correct decision. It is now firmly settled that an appellate court looks and bases its decision at the c correctness of the decision and not necessarily at the reason for the decision. In other words, an appellate court will not set aside the decision of a lower court which is right and just merely because the trial Judge or the court below gave d wrong reasons for the decision. The paramount consideration for the appellate court is whether the decision is right and not necessarily whether the reasons are right. See Sowemimo v Somisi and others (1982) 1 All NLR (Part 1) 49; United Bank for Africa Ltd and another v Achoru e (1990) 6 NWLR (Part 156) 254, (1990) 10 SCNJ 17 at 26; Ayeni and others v Sowemimo (1982) 5 S.C. 60 at 74: and recently, Alhaji Ndayako v Alhaji Dantoro and others (2004) 5 SCNJ 152 at 172, 177; (2004) 13 NWLR (Part 889) f 187. In the end result or analysis, this appeal is most frivolous. It fails and it is accordingly dismissed. g I hereby affirm (on a different ground) the decision of the court below. Costs follow the event. The respondent is entitled to costs of N10,000 (Ten Thousand Naira) payable to it by the appellant. h BELGORE JSC: I agree that this appeal has no merit. For the reasons fully set out in the judgment of Ogbuagu, JSC I also dismiss it with same orders as to costs. i KALGO JSC: I have had the opportunity of reading in advance the judgment of my learned brother Ogbuagu, JSC just delivered. I agree with his reasoning and conclusions reached therein which I adopt as mine. I therefore find no j merit in the appeal. I dismiss it with costs as assessed in the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Kalgo JSC 232 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) leading judgment. I affirm the decision of the Court of a Appeal. TOBI JSC: This appeal falls into a very narrow compass. It is whether the matter has anything to do with admiralty, and b therefore subject to the jurisdiction of the Federal High Court. The struggle for jurisdiction between the Federal High Court and the High Court of the States became more pronounced and troublesome when the Federal Military c Government promulgated the Admiralty Jurisdiction Decree No. 59 of 1991 adding to the traditional jurisdiction in admiralty matters way back to the English Administration of Justice Act, 1956. See section 24 of the Federal High Court d Act (Cap 134) Laws of the Federation of Nigeria, 1990. The plaintiff’s claim at the Federal High Court reads. “Sometime in 1990, the defendant while carrying on its banking business forwarded to the plaintiff an irrevocable documentary e letter of credit No. 16167/65626 established in Belgium and by a letter dated 12/10/90 the defendant confirmed the authenticity of the letter of credit. Pursuant to the defendant’s advice and confirmation the plaintiff adopted the letter of credit and exported Iroko furniture components worth DM28,527 to one C. I. E. f Dubios Stockmanns in Belgium. In spite of repeated demands the plaintiff has received no payment of its goods. Wherefore the plaintiff claim against the defendant the sum of N120,000,000 special and general damages.” g The defendant, in a motion dated 23 March, 1997, prayed the Federal High Court to dismiss the suit or in the alternative to strike it out on the ground that the court lacked the jurisdiction to entertain the suit. The learned trial Judge h thought differently. He held that he has jurisdiction to hear the matter. In his ruling of 7 July, 1997, Abutu, J said at page 16 of the record:– “Having regard to the provision of Section 1(1)(h) of the Decree i above set out, the crucial question in this application is whether the banking transaction in relation to which this action has been commenced is a letter of credit transaction involving the importation or exportation of goods to and from Nigeria in a ship or an aircraft. The averments in paragraphs 4 – 9 of the statement j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 233 a of claim already filed shows beyond question that the dispute between the parties is in connection with a letter of credit transaction for exportation of goods out of Nigeria. The affidavit evidence and the averments in the statement of claim do not show b that the transaction is one between a bank and it (sic) customer. Therefore it is my respectful conclusion that the proviso to Section 230(1)(h) of the 1979 Constitution as modified by Decree No. 107 of 1993 does not apply to this case. In the result I hold that the suit c is one within the admiralty jurisdiction of this court. The court therefore has jurisdiction to entertain the suit. The objection is overruled and the motion is hereby dismissed.” The appeal to the Court of Appeal succeeded. Ba’aba, JCA d and his other two brothers did not agree with the learned trial Judge. To them, the suit did not involve admiralty. Ba’aba, JCA was pungent. He said:– “With the greatest respects to the learned trial Judge, I disagree e with him, that Section l(1)(h) of the Admiralty Jurisdiction Decree No. 59 of 1991 has conferred jurisdiction on the trial court when the said section ceases to have effect by virtue of the modification of the Constitution by Decree No. 107 of 1993. See Bi Zee Bee Hotels Ltd v Allied Bank (Nig.) (1996) 8 NWLR (Part 465) 176, f 181 . . . My answer to the sole issue is therefore in the affirmative in that the learned trial Judge, in my opinion was wrong to have held that he had jurisdiction to entertain the claim of the plaintiff/respondent. In the result, the appeal succeeds and is hereby allowed. I hold that the learned trial Judge lacks the g jurisdiction to entertain the action having regards to the proviso to paragraph (d) of Section 230(1) of the 1979 Constitution (as amended).” Ba’aba, JCA accordingly ordered that the suit be transferred h to the Delta State High Court. Aggrieved by that judgment, the appellant has come to this Court. Briefs were filed and duly exchanged. The pith of the argument of learned Counsel for the appellant is that the i matter involves admiralty and therefore within the jurisdiction of the Federal High court. Counsel for the respondent takes the opposite position and it is that by virtue of the proviso to section 230(1)(d) of the 1979 Constitution j of the Federal Republic of Nigeria as amended by the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC 234 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Constitution (Suspension and Modification) Decree No. 107 a of 1993, the jurisdiction of the Federal High Court is ousted from determining the claim of the appellant. Counsel did not quite like the position taken by the Court of Appeal in the b case of Afribank v KCG (Nig) Ltd (2001) FWLR (Part 67) 1042; (2001) 8 NWLR (Part 714) 87, which he regarded as reviewing the decision, a situation which Counsel said amounted to reopening the decision. c Admiralty has so much affinity with maritime law, so much so that the words are used interchangeably in marine practice. It has not that affinity with the law of the sea. Admiralty refers to the law of marine commerce and marine d navigation. It entails the transportation at sea of persons and property and marine affairs in general. The position of the law before 1991 and from 1979 was that the Federal High Court and the State High Courts had e concurrent jurisdiction on admiralty matters. This arose from the unlimited jurisdiction conferred on the State High Courts by section 236 of the 1979 Constitution. See Savannah Bank of Nigeria Ltd v Pan Atlantic Shipping and f Transport Agencies Ltd (1987) 1 NWLR (Part 49) 212; Omisade v Akande (1987) 2 NWLR (Part 55) 158; Nigerian National Supply Co Ltd v Sabana and Co. Ltd (1987) 2 NWLR (Part 56) 285. The above is useful only as an g historical stuff (sic). The admiralty jurisdiction of the Federal High Court is now clearly set out in the Admiralty Jurisdiction Decree No. 59 of 1991 and the case law is in great proliferation. See h Brawal Shipping (Nig) Ltd v Extraction and Commodity Services Ltd (2001) 14 NWLR (Part 732) 172; Alraine Shipping (Nig) Ltd v Endura Auto Chemicals (2001) 12 NWLR (Part 728) 759; Crownstar and Company Limited v i The Vessel MV Valip (2000) 1 NWLR (Part 639) 37; Shell Petroleum Company (Nig) Limited v Isaiah (1997) 6 NWLR (Part 508) 236; Tigris International Corporation v Ege Shipping and Trading Industry (1999) 6 NWLR (Part 608) j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 235 a 701; Pacers Multi Dynamic Limited v MV “Dancing Sister” (2000) 3 NWLR (Part 648) 241. The contention of learned Counsel for the appellant is that b the admiralty jurisdiction in this matter is conferred on the Federal High Court by sections l(1)(h) and 19 of the Admiralty Jurisdiction Decree No. 59 of 1991. Let me quickly read the provisions:– c “1 (1) The admiralty jurisdiction of the Federal High Court . . . includes the following, that is . . . (h) any banking or letter of credit transaction involving the importation or exportation of d goods to and from Nigeria in ship or aircraft, whether the importation is earned out or not and notwithstanding that the transaction is between a bank and its customer. 19. Notwithstanding the provisions of any other enactment or e law, the court shall, as from the commencement of this Decree, exercise exclusive jurisdiction in admiralty causes or matters, whether civil or criminal.” The above provision will not make any meaning if it is read f in vacuo or in isolation. It can only make the desired meaning if it is read together and along with the claim, which have already set out above (sic). I will not repeat it, but I will only refer to relevant aspects of it. The relevant g aspect reads:– “Sometime in 1990, the defendant while carrying on its banking business forwarded to the plaintiff an irrevocable documentary letter of credit No. 16167/65626 established in Belgium and by a letter dated 12/10/90 the defendant confirmed the authenticity of h the letter of credit.” I think I can stop here. I have got what I want. All that the defendant did was the confirmation of the authenticity of the plaintiff’s letter of credit No. 16167/65626. This was done i by the defendant’s letter dated 12/10/90. The million naira question is, how can a mere act of confirmation of the authenticity of a letter of credit suddenly ripen or metamorphose into an admiralty matter? What is the content j of admiralty in the letter of confirmation dated 12/10/90?

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC 236 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Has the letter anything to do with shipping, air crafting, a transportation of property at sea and marine commerce and marine navigation in typical marine affairs? Section l(1)(h) talks about banking or letter of credit b transaction involving the importation or exportation of goods. Does the letter of credit No. 16167/65626 qualify as goods within the meaning of section 1(1)(h) of the Decree? What did the defendant do to reduce its actions to the c meaning of section l(1)(h) of the Decree? In my effort and anxiety to obtain a positive answer, I read paragraph 5 of the statement of claim:– “By a letter reference IDC0090/90 dated 12/10/90 addressed to the d plaintiff’s said bankers, and a copy to the plaintiff, the defendant advised on and confirmed the authenticity of telex establishing the letter of credit and requested for the sum of N25.00 as advising commission. e The plaintiff upon receipt of a copy of defendant’s letter paid the commission of N25.00 to the defendant with a NNB Limited draft No. 602092 of 19/11/90 and acted on the defendant’s advice and confirmation by exporting Iroko furniture components to C.I.E. Budois Stockmanns in Belgium between the 30 November, 1990 f and 30 December, 1990 (both days inclusive). The plaintiff shall found on NNB letter of 14/11/90, plaintiffs letter of 21/11/90 addressed to the NNB Limited, Warri, plaintiff’s invoices No. 007, 008 and 009 for the export in the value of DM38,527.70 delivered to the defendant.” g My action smacks of a repetition as I had earlier reproduced the claim. I do not regret the repetition. It is to make the position doubly sure. The appellant’s averment in paragraph 5, if anything at all, could be a contractual relationship and h breach of that relationship. How can a contractual matter be an admiralty matter which must be foisted on the Federal High Court? And the respondent has to suffer all these for the sum of N25, the advising commission? Really, I feel bad i for the respondent. Learned Counsel for the appellant submitted that the proviso to section 230(1)(d) of the 1979 Constitution of the Federal Republic of Nigeria as amended by the Constitution j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 237 a (Suspension and Modification) Decree No. 107 of 1993 vests in both the High Court of a State and the Federal High Court concurrent jurisdiction to entertain claims between a b customer and the banker. He cited Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333 and NDIC v Okem Ent Ltd (2004) 10 NWLR (Part 880) 107. I do not agree with learned Counsel that there exists or c existed banker and customer relationship in this matter. Paragraph 4 of the statement of claim falsifies the submission of a banker and customer relationship. The opening sentence of paragraph 4 reads:– d “Sometime in 1990 the plaintiff received through its bankers, the New Nigerian Bank Plc, a telex of an irrevocable Documentary Letter of Credit . . .”. Paragraph 5 is also relevant here. I had earlier quoted it. Let e me just confine myself to part of the first sentence and I will be done:– “By a letter reference IDC00901/90 dated 12/10/90 addressed to the plaintiff’s said bankers and a copy to the plaintiff . . .”. f While paragraph 4 of the statement of claim is clear on the issue, a community reading (sic) of the first sentence in paragraphs 4 and 5 also makes me to come to the conclusion that the banker of the appellant at the material time was New g Nigeria Bank Plc. While paragraph 4 specifically so averred, paragraph 5 used the verb “said” before the word “bankers” to relate it to the New Nigeria Bank Plc. In the circumstances, I cannot consider the two cases cited by h Counsel because they are not relevant to this case. Although the jurisdictional struggle between the Federal High Court and the High Court of a State came to the height by the most ambitious, and to some extent, unwarranted i amendments introduced into the 1979 Constitution by Decrees Nos. 59 and 60 of 1991 and 107 of 1993, Counsel (and here it is not confined to the one doing this case), have played some role in fomenting the struggle for hegemony. j While raising the issue of jurisdiction is part of the trade of

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC 238 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Counsel and they relish in it, they are well advised not to a raise it in obvious cases. It is not good to raise the issue of jurisdiction merely to test the ground and see how the courts will react. In my view, this is a clear case of contract and b whether the contract was breached or not is beyond me to say. All that is not beyond me to say is that there is not the slightest admiralty content in the matter. I therefore dismiss the appeal. I award costs as in the judgment of my learned c brother Ogbuagu, JSC.

OGUNTADE JSC: The appellant was the plaintiff at the Federal High Court, Benin where it brought a claim against d the respondent, as the defendant claiming for:– “The defendant which carries on banking business nationwide has offices in Benin within the jurisdiction of this Honourable Court. Sometime in 1990, the defendant while carrying on its banking e business forwarded to the plaintiff an irrevocable documentary letter of Credit No. K16167/65626 established in Belgium and by a letter dated 12/10/90 the defendant advised and confirmed the authority of the letter of credit. Pursuant to the defendant’s advice and confirmation the plaintiff adopted the letter of credit and f exported Iroko furniture components worth M28527 to one C.J.E. DUB 105 STOCKMANIVS in Belgium. In spite of repeated demand (sic) plaintiff has received no payment for its goods. Wherefore the plaintiff claim (sic) against the defendant the sum g of N120,000,000.00 (One Hundred and Twenty Million Naira) as special and . . .”. Later, the plaintiff filed its statement of claim. The defendant, which had not filed a statement of defence h brought an application praying that plaintiff’s suit be dismissed or struck out on the ground that the Federal High Court lacked the jurisdiction to entertain the suit. Paragraphs 3 to 5 of the affidavit in support of the defendant’s motion i read:– “3. That I know as a fact that by virtue of exhibit ‘A’ i.e. plaintiff/respondent’s statement of claim, this Honourable Court lacks jurisdiction to entertain this suit. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 239 a 4. That such claim as per Exhibit ‘A’ does not fall within the purview of this Honourable Court’s power to determine. 5. That this Honourable Court should dismiss or strike out this b suit.” The trial Judge Abutu, J heard arguments on the defendant’s application. In his ruling on 7/7/97, he came to the conclusion that the plaintiff’s suit was within the admiralty c jurisdiction of the Federal High Court. Dissatisfied, the defendant brought an appeal against the ruling before the Court of Appeal, Benin Division (hereinafter referred to as the “court below”). The court below, on 12/7/2000, d allowed the appeal and held that the Federal High Court lacked the jurisdiction to hear the suit. The suit was accordingly transferred to the Delta State High Court for determination. e The plaintiff has come on a final appeal before this Court. In its appellant’s brief, it was queried whether the court below was right in holding that the Federal High Court lacked the jurisdiction to entertain plaintiff’s suit. f Now section 230 of the 1979 Constitution as amended by section 1(3) of the Constitution (Suspension and Modification) Decree No. 107 of 1993 provides:– “230. Notwithstanding anything to the contrary contained in this g Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly or a Decree, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other court h in civil causes and matters arising from - (g) any admiralty jurisdiction including shipping and navigation on the River Niger or River Benue and their affluent and on such other inland waterway as may be designated by any enactment to be an i international waterway, all Federal ports, including the constitution and powers of the ports authorities for Federal Ports and Carriage By Sea.” Under Act No. 59 of 1991, titled “The Admiralty j Jurisdiction Act, the admiralty jurisdiction of the Federal

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 240 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

High Court is set out in sections 1(1) and 19. The sections a provide:– 1 (1) The admiralty jurisdiction of the Federal High Court (in the decree referred to as ‘the court’) includes the b following, that is - (h) any banking or letter of credit transaction involving the importation or exportation of goods to and from Nigeria in a ship or an aircraft c whether the importation is carried out or not and notwithstanding that the transaction is between a bank and its customer. . . . d 19. Notwithstanding the provisions of any other enactment or law, the court shall, as from the commencement of this decree exercise exclusive jurisdiction in admiralty cause or matters whether civil or criminal.” e There is no doubt that the Federal High Court under the provision of Act No. 59 of 1991 had its jurisdiction extended beyond the scope given under Act 107 of 1993 Constitution above. The question, whether or not a court has jurisdiction f to entertain a class of action is to be decided on the basis of the averments contained in the statement of claim filed by the plaintiff. See Adeyemi v Opeyori (1976) 9–10 SC 31. The plaintiff in paragraphs 3-10 of its statement of claim had pleaded:– g “3. As part of defendant’s business structure, defendant has International Banking Department, Export Unit, which renders professional banking advice and export banking services to members of the business public on letters of h credit, export on foreign trade and allied matters on commission basis. 4. Sometime in 1990 the plaintiff received through its bankers, the New Nigeria Bank Plc., a telex on an Irrevocable i Documentary Letter of Credit No. 16167/65626 from the defendant which said letter of credit has as its applicant, C.I.E. Dubois Stockmanrts of Belgium, the plaintiff as the beneficiary and Krediet Bank N.V. of Belgium as the foreign Bank which purportedly issued same. The plaintiff shall j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 241 a found on a copy of the said telex letter of credit for its full terms and effects. 5. By a letter reference IDC0090/90 dated 12/10/90 addressed b to the plaintiff’s said bankers, and a copy to the plaintiff, the defendant advised on and confirmed the authenticity of telex establishing the letter of credit and requested for the sum of N25.00 as advising commission. The plaintiff upon receipt of a copy of defendant’s letter paid the commission of N25.00 c to the defendant with a NNB Limited Draft No. 602092 of 19/11/90 and acted on the defendant’s advice and confirmation by exporting Iroko furniture components to C.I.E. Dubois Stockmanns in Belgium between the 30 November, 1990 and 30 December, 1990 (both days d inclusive). The plaintiff shall found on NNB letter of 14/11/90, plaintiff’s letter of 21/11/90 addressed to the NNB Limited, Warri, plaintiff’s Invoices No. 007,008 and 009 for the export in the value of DM28,527.70 delivered to the e defendant. 6. By the terms of the letter of credit, the plaintiff’s drafts for the value of the goods were to be paid on presentation of the relevant shipping documents to the defendant which the plaintiff duly submitted to the defendant and uptil now the f plaintiff has received no draft or payment for the value of the goods exported under the said letter of credit. 7. At the time the defendant forwarded to the plaintiff the said letter of credit and the letter of confirmation dated 12/10/90, g the defendant intended – and it well knew or ought to have known that the plaintiff would rely on them and would be induced thereby to export its goods upon the terms contained therein. In the premises, the defendant was under a duty to h take care in the making of the said representations to the plaintiff so as not (sic) cause plaintiff any financial loss or damage. 8. Acting on the faith of the defendant’s representations and induced thereby, the plaintiff exported Iroko furniture i components in the value of DM28,527.70 to C.I.E. Dubois Stoclunanns in Belgium and for which no payment has been received. 9. In breach of the said duty, the defendant was guilty of j negligence in making the said representation.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 242 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

PARTICULARS a (a) Failing to ascertain the authenticity of the letter of credit to the terms of the letter of credit. (b) Failing to have at sight the plaintiff’s (beneficiary) draft b before accepting the export documents. (c) Failing to ensure that the beneficiary’s draft is at sight of the foreign bank before advising and or confirming the letter of credit. c (d) Failing to advice the plaintiff not to deal with the beneficiary in the circumstance. (e) Failing to advice the plaintiff not to deal with foreign bank in the absence of any draft at sight 10. In truth and in fact, the said representations were false, d untrue inaccurate and misleading.” The above averments from plaintiff’s statement of claim show that the basis of the claim made against defendant was in negligence in that the defendant had not exercised due e care and diligence in advising the plaintiff that the telex by which a letter of credit was established in the plaintiff’s favour was genuine. It was not pleaded that the defendant issued the said letters of credit or that the Iroko furniture f shipped by the plaintiff was sent to the defendant’s principals. Nothing in the statement of claim conveyed that a shipping transaction was contemplated between the plaintiff and the defendant. g The court below at pages 74 – 75 in coming to the conclusion that the Federal High Court has no jurisdiction to entertain plaintiff’s suit reasoned thus:– “The position on the question of the criterium to be followed in h determining jurisdiction has long been settled. The position is that it is the plaintiff’s demand or claim that determines the jurisdiction of a court. Therefore, in order to ascertain whether or not a court has i jurisdiction to try a case, one only needs to look at the plaintiff’s claim: See Izenkwe v Nnadozie (1953) 14 WACA 361; Adeyemi and Others v Opeyori (1976) 9 – 10 S.C. 31 at 51; Egbuziem v N.R.C. (1994) 2 NWLR (Part 330) 23; Tukur v Government of Gongola State (1989) 4 NWLR (Part 117) 517 at 549 and Western j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Integrated Timber and Plywood Pro. Ltd. v Union Bank Nig. Plc 243 a Steel Works v Iron and Steel Workers (1987) 1 NWLR (Part 49) 284; In New Nigeria Bank Limited v Boardman Odiase (1993) 8 NWLR (Part 310) 238 at 243, a bank customer had been defined as follows:– b ‘. . . Generally a customer is someone who has an account with a bank, or without having an account the relationship of banker and customers exists. In the latter case some money transaction must connect banker and customer, but must arise c from the nature of a contract.” The definition of a customer also at page 386 of Black’s Law Dictionary (6ed) in relation to a bank is as follows:– “In banking, any person having an account with a bank or for d whom a bank has agreed to collect items and includes a bank carrying an account with another bank. As to letters of credit, a buyer or other person who causes as issuer to issue credit or a bank which procures issuance or confirmation on behalf of that bank’s customer. e In my view from a careful examination of the respondent’s claims contained in the respondent’s statement of claim, herein reproduced and taking into consideration the two definitions above, it cannot be disputed that the dispute that gave rise to this f action falls within the confine of the relationship between a bank and customer in which case, the jurisdiction of the Federal High Court, has been ousted by the proviso to paragraph (d) of Section 230(1) of the 1979 Constitution as amended by Decree No. 107 of 1993”. g From the above passage, the court below reasoned that plaintiff’s action was in the nature of a dispute between an individual customer and his bank, in which case, the Federal High Court had no jurisdiction. I am with respect, unable to h agree that the plaintiff’s statement of claim revealed a bank/ customer relationship between the plaintiff and the defendant. The nearest the plaintiff went in showing a bank/ customer relationship was in its paragraph 5 wherein it i averred that it paid N25 for plaintiffs services. The court below in its judgment relied on the definition of bank/ customer relationship as given in New Nigeria Bank Ltd v Boardman Odiase (supra). The plaintiff averred in j paragraph 4 of its statement of claim that its bankers were

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 244 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

“The New Nigeria Bank Plc”. The relationship between the a plaintiff and the defendant shown as it were, to be a one-off transaction, would not qualify in my view to be a bank/ customer relationship. Certainly, that was not the nature of b the case pleaded by the plaintiff. Were it so, the plaintiff would not need to plead specifically that its bankers were ‘The New Nigeria Bank Plc’. My learned brother Ogbuagu, JSC has in the lead c judgment with which I agree, shown the reasons why this appeal must be dismissed. It is my view that decision of this court in NDIC v Okem Enterprises Ltd and another (2004) 10 NWLR (Part 880) 107 does not apply to the facts of this d case since, in my view, the plaintiff was not a customer to the defendant. I also do not think that plaintiff’s suit has any relationship with the admiralty jurisdiction of the Federal High Court. e I would also dismiss this appeal as in the lead judgment. I also award N10,000 costs in favour of the defendant against the plaintiff. Appeal dismissed. f

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

Ethiopian Airlines v Afribank Nigeria Plc 245 a Ethiopian Airlines v Afribank Nigeria Plc

COURT OF APPEAL, LAGOS DIVISION b SALAMI, AGBO, GALINJE JJCA Date of Judgment: 1 JUNE, 2006 Suit No.: CA/L/409/2001

Banking – Banker/customer relationship – Simple contract – c Subject to Limitation Law Limitation law – Banker/Customer relationship – Subject to Limitation Law – Principle governing d Facts The appellant as plaintiff claimed of the respondents at the High Court of Lagos State as follows:– (i) The sum of N447,000 (Four Hundred and Forty- e seven Thousand Naira) and N5 (Five Naira) commission on the draft being the sum of money due to the plaintiff from the first and second defendants viz: f (a) Refund of the money for draft negligently issued by the first defendant to the second defendant together with the commission debited against the plaintiff’s account. g (ii) The sum of N1,000,000 (One Million Naira) being special damages suffered by the plaintiff due to the negligence of the first defendant in issuing the bank draft contrary to the plaintiff’s instructions, to the h order of the second defendant and for facilitating the conversion of the money stated in the said bank draft by the second defendant. (iii) The sum of N1,000,000 (One Million Naira) being i general damages suffered by the plaintiff due to the negligence of the first defendant and for negligently and improperly facilitating the conversion of the sum of N447,000 (Four Hundred and Forty-seven j Thousand Naira) by the second defendant, which

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

246 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

sum the first and second defendants have refused in a pay to the plaintiff inspite of repeated demands. (iv) Interest on the above sum of money as stated in (1), (2) and (3) above at the rate of 21% per annum from b 2 April, 1990 till judgment and at the rate 6% per annum till final liquidation of the debt,

Pleadings were filed and exchanged. Thereafter the first c respondent on 18/9/97 filed a motion seeking to have the suit dismissed on the ground that the suit was statute-barred. Affidavits were exchanged, argument taken and in a considered ruling Honourable Justice LGA Marsh dismissed d the suit, having found it to be statute-barred. Being dissatisfied with the judgment of the lower court, the appellant has filed this appeal challenging the ruling of the court below. e

Held – 1. The relationship between the parties being that of banker and customer, the transaction is found on simple f contract. The dispute falls within the contemplation of section 8(1)(a) of Limitation Law (Cap 118) of the Laws of Lagos State of Nigeria, 1994. g 2. Per curiam “The appellant’s ominous silence on when it knew the draft was wrongly paid or diverted is deliberate. It is intended to mislead the court into finding that the Suit h was not yet statute-barred. The appellant was aware of the first respondent not drawing the draft to its order on or about 2 April, 1990 nevertheless it did not bring an action for remedy until which is frivolous by which time the suit was bad for effluxion of time. See Fadare and i others v Attorney-General of Oyo State (1962) NSCC 52, 60, (1982) 7 SC 60; Board of Trade v Cayner Irvine and Co Ltd (1927) AC 610 and Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379. The appellant having known that his draft was not drawn in j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

Ethiopian Airlines v Afribank Nigeria Plc 247 a accordance with his instruction nevertheless failed or neglected or refused to take action has himself to blame. It is too late for it to cry over spilled milk.” b Appeal dismissed. Cases referred to in the judgment Nigerian c Ajakaiye v Military Governor Bendel State (1993) 9 SCNJ 242 Ajibona v Kolawole (1996) 10 NWLR (Part 476) 22 Akibu v Azeez (2003) 5 NWLR (Part 814) 643 d Akinfolarin v Akinnola (1994) 3 NWLR (Part 335) 659 Egbe v Adefarasin (1987) 1 NWLR (Part 47) 1 Ekeogu v Aliri (1991)3 NWLR (Part 179) 258 e Fadare v A-G, Oyo State (1962) NSCC 52 Iheanacho v Ejiogu (1995) 4 NWLR (Part 389) 324 Jallco Ltd v Owoniboys Tech Services Ltd (1995) 4 NWLR f (Part 391) 534 Kotoye v Saraki (1994) 7 NWLR (Part 357) 414 NPA Plc v Lotus (2005) 12 SC (Part 1) 19; (2005) 10 NWLR (Part 959) 158 g Odubeko v Fowler (1993) 7 NWLR (Part 308) 637 Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379 h Solomon v African Steamship (1928) 9 NLR 99 Yalaju Amaye v AREC Ltd (1990) 4 NWLR (Part 145) 42 Foreign i Board of Trade v Cayner Irvine and Co Ltd (1927) AC 610

Nigerian statute referred to in the judgment Limitation Law Cap 118 Laws of Lagos State, 1994, section j 8(1)(a)

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

248 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Counsel a For the appellant: Oshikoya (with him Aluko and Lawal) For the first respondent: Ufot (Mrs) (with her Omoniyi and b Ndulogwu) For the second respondent: Nwamdie (Mrs)

Judgment c AGBO JCA: (Delivering the lead judgment) The appellant as plaintiff claimed of the respondents at the Lagos Division of the High Court of Lagos State as follows:– i. The sum of N447,000 (Four Hundred, Forty-seven d Thousand Naira) and N5 (Five Naira) commission on the draft being the sum of money due to the plaintiff from the first and second defendants viz:– a. Refund of the money for draft negligently issued e by the first defendant to the second defendant together with the commission debited against the plaintiff’s account. ii. The sum of N1,000,000 (One Million Naira) being f special damages suffered by the plaintiff due to the negligence of the first defendant in issuing the bank draft contrary to the plaintiff’s instructions, to the order of the second defendant and for facilitating the g conversion of the money stated in the said bank draft by the second defendant. iii. The sum of N1,000,000 (One Million Naira) being general damages suffered by the plaintiff due to the h negligence of the first defendant and for negligently and improperly facilitating the conversion of the sum of N447,000 (Four Hundred, Forty-seven Thousand Naira) by the second defendant, which sum the first i and second defendants have refused to pay to the plaintiff inspite of repeated demands. iv. Interest on the above sum of money as stated in (i), (ii) and (iii) above at the rate of 21% per annum from j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA Ethiopian Airlines v Afribank Nigeria Plc 249 a 2 April, 1990 till judgment and at the rate 6% per annum till final liquidation of the debt. Pleadings were filed and exchanged. Thereafter the first b respondent on 18/9/97 filed a motion seeking to have the suit dismissed on the ground that the suit was statute-barred. Affidavits were exchanged, argument taken and in a considered ruling Honourable Justice LGA Marsh dismissed c the suit, having found it to be statute-barred. Being dissatisfied with the judgment of the lower court, the appellant has filed this appeal challenging the ruling of the court below on the following grounds:– d Grounds of appeal A. Error in law “The learned trial Judge erred in law when he held that the cause e of action arose when the first defendant allegedly issued the draft to the order of the second defendant contrary to plaintiff’s instruction. The plaintiff was supposed to have taken action to recover the N447,000.00 from the first defendant. He did nothing all these years hence he’s caught by the limitation law. He should f have sued within the six years. Particulars of Errors i. When the learned trial Judge erroneously held that cause of action arose when the first defendant issued the draft to the g order of the second defendant. ii. When at the time the first defendant issued the draft to the order of the second defendant in 1990 contrary to the plaintiff’s instructions the plaintiff was not aware of the h error until sometimes in 1994. iii. When the learned trial Judge failed to avail himself of the Supreme Court authority applicable to the matter (i.e. the case of Jallo Ltd and Another v Owoniboys Technical Services Ltd (1995) 4 NWLR (Part 391) 534 at 538 ratio 6) i despite the reliance placed on the case by the appellant. B. Error in law The learned trial Judge erred in law when he held that ‘From the exchange of correspondence between the parties, exhibits TCE1 – j TC6 considered along with the action of the first defendant during

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Agbo JCA 250 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

the period there is nothing in my view that could stop the first a defendant from relying on or raising the issue of limitation period’. i. When it is abundantly clear that exhibits TCE1 – TCE3 have nothing to do with computation of time limitation or b the action of the plaintiff in respect of its claim. ii. When it is abundantly clear from exhibits TCE4 and TCE5 that the plaintiff did not become aware of the error committed by the first defendant until the writing of exhibit TCE5 by the first defendant. c iii. When it is abundantly clear from the circumstance of the case that the plaintiff filed its action within 6 years of its becoming aware of the errors of the first and second defendants.” d The appellant distilled one issue for determination from the above grounds of appeal to wit:– “Whether or not the learned trial Judge was right in holding that the cause of action arose when the first respondent issued the draft e to the order of the second respondent contrary to the instruction of the appellant.” On the other hand, the first respondent distilled two issues for determination to wit:– f “1. Whether the learned trial Judge was right in holding that the appellant’s cause of action arose on 2 April, 1990 when the first respondent allegedly issued the bank draft to the order of the second respondent instead of to the appellant. g 2. Whether the appellant’s alleged ignorance of the issuance of the draft to the order of the second respondent as alleged is material to the computation of the statutory period of limitation, when fraudulent concealment is neither alleged not proved.” h The second respondent adopted the issues as distilled by the first respondent. I have looked at the issues distilled by the appellant and the respondents. The issues as distilled by the appellant is i exactly the same as that distilled by the respondents in their issue No. 1 excepting that there is better clarity of language in issue No. 1 as distilled by the respondents. The respondent’s issue No. 2 can be comfortably subsumed in j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA Ethiopian Airlines v Afribank Nigeria Plc 251 a issue No. 1. This appeal shall therefore be treated as a one issue appeal. The facts of this case are rather short and simple. They are b fully reflected in paragraphs 3 to 17 of the statement of claim which are reproduced hereunder: “3. The plaintiff maintained Account No. 36270236c with the first defendant and also maintained Account No. c 7770571037 with the second defendant. 4. On or about 2/4/90 the plaintiff instructed the first defendant to issue a draft in the sum of N447,000.00 to the order of the plaintiff and to be paid into the plaintiff’s account with the d second defendant. 5. The plaintiff avers that though the first defendant issued a bank draft No. 009126 dated 2/4/90, the draft was issued to the order of Continental Merchant Bank Plc contrary to the e plaintiff’s instruction. 6. The plaintiff aver (sic) that the said draft was delivered to the second defendant on 4/4/90 and the same was duly acknowledged by the second defendant by endorsing its stamp on the said draft. The plaintiff will rely on a copy of f the said draft at the trial of this action. 7. The plaintiff avers that in the process of reconciling the plaintiff’s account at its Head Office in Addis Ababa, Ethiopia the said sum of N447,000.00 was discovered not to g have been credited to the plaintiff’s account. 8. The plaintiff wrote a letter dated 1/9/94 to the first defendant requesting for a clarification on the debit sum of N447,000.00. The plaintiff shall rely on the said letter at the h trial of this action. 9. In reply to the plaintiff’s letter referred to in paragraph 8 above the first defendant by its letter dated 1/11/94 purportedly debited the plaintiff’s account for the draft issued to the second defendant. The plaintiff will rely on the i said letter at the trial of this action. 10. The plaintiff consequently wrote a letter dated 20/4/95 to the second defendant requesting for a clarification of the said sum of N477,000.00 and a detailed statement of account. The j plaintiff will rely on the said letter at the trial of this action.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Agbo JCA 252 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

11. The plaintiff avers that the second defendant in its letter a dated 11/5/95 to the first defendant, demanded for a copy of the draft and evidence of acknowledgment of its receipt by the second defendant. The plaintiff will rely on the said letter at the trial of this action. b 12. By another letter dated 16/8/95 to the second defendant the plaintiff attached a copy of the said draft with evidence of second defendant’s acknowledgment of receipt of same. The second defendant is hereby given notice to produce the said c letter at the trial of this action. 13. Thereafter the plaintiff instructed its solicitors Messrs Yomi Oshikoya and Co. to take necessary steps to recover the said sum. d 14. The plaintiff’s solicitors wrote two separate letters of demands to the first and second defendants which letters are dated 3/10/95 and 6/10/95 respectively. The first and second defendants are hereby given notice to e produce the said letters at the trial of this action. 15. In response to the plaintiff’s solicitors letter dated 6/10/95 the first defendant vide its letter dated 17/10/95 informed the plaintiff’s solicitors that necessary investigation is being carried out on the matter. The plaintiff will rely on the letter f at the trial of this action. 16. The plaintiff avers that the failure to credit the plaintiff’s account is due to the negligence of the first defendant in issuing the draft to the order of the second defendant instead g of issuing the draft to the order of the plaintiff. The plaintiff shall rely on the doctrine of res ipsa loquitur at the trial of this action. 17. The plaintiff avers that the second defendant has since converted the said sum of N447,000.00 to its use and failed h or refused to credit plaintiff’s account with the said sum despite repeated demands.” In arguing the appeal, the appellant’s Counsel in his written brief posited that it is common ground that the relationship i between the appellant and respondents being that of banker and customer, the transaction in dispute was founded on simple contract. He then proceeded to cite section 8(1)(a) of the Limitation Law of Lagos State j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA Ethiopian Airlines v Afribank Nigeria Plc 253 a Cap 118 Laws of Lagos State of Nigeria, 1994 which provides as follows:– 1. “The following actions shall not be brought after the b expiration of six years from the date on which the cause of action accrued– a. ‘actions founded on simple contract’.” He then proceeded to cite the dictum of Oputa, JSC in Egbe c v Adefarasin (1987) 1 NWLR (Part 47) 1 where the retired Justice of the Supreme Court and erudite scholar set out how to determine periods of limitation where statutes provide for limitation. He asserted that if the principles in Egbe v d Adefarasin were applied simpliciter in the present case, the appellant would be time-barred. But he urged that, in the circumstances of this case the court should rather apply the principle enunciated in Jallco Ltd v Owoniboys Tech Services Ltd (1995) 4 NWLR (Part 391) 534 and hold that e time did not begin to run until the time the appellant became aware that the first respondent did not issue the bank draft to the order of the appellant as instructed. f In answer to the appellant’s argument, the respondents have replied that the dictum in Egbe v Adefarasin (supra) remains solid and unassailable. To further buttress that position, they cited the dictum by Wali, JSC in Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379 g at 388. Where the learned jurist said that:– “In actions for breach of contract, the cause of action accrues for the plaintiff’s benefit from the time the breach of contract is committed and not when the damage is suffered. The period of h limitation will begin to run from the date the cause of action accrues.”. See also Iheanacho v Ejiogu (1995) 4 NWLR (Part 389) 324. i They added for clincher the lead judgment of Ogwuegbu, JSC in Ajibona v Kolawole (1996) 10 NWLR (Part 476) 22 where the Supreme Court held that knowledge by a plaintiff was not a condition precedent for the application of the j limitation provisions of the Limitation Law of Lagos State.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Agbo JCA 254 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

That decision was followed by the Supreme Court in Akibu v a Azeez (2003) 5 NWLR (Part 814) 643. What then is the true position? When can it be said in the circumstances of this case that the plaintiff’s cause of action b had accrued and time started running for the purposes of section 8(1)(a) of the Limitation Law of Lagos State? The locus classicus on the accrual of cause of action and therefore the commencement of the running of time for the c purpose of the limitation provision in any statute is the decision of the Supreme Court in Egbe v Adefarasin (supra) the relevant portion of which is reproduced hereunder:– d “A cause of action is thus said to be statute barred if in respect of it proceedings cannot be brought because the period laid down by the Limitation Law or Act had elapsed. How does one determine the period of limitation? The answer is simple – by looking at the writ of summons and statement of claim alleging when the wrong e was committed which gave the plaintiff a cause of action and by comparing that date with the date on which the writ of summons was filed. This can be done without taking oral evidence from witnesses. If the time on the writ is beyond the period allowed by the Limitation Law, the action is statute barred.” f Some other authorities seem to suggest that time does not begin to run unless and until the plaintiff is aware of the damage caused him by the conduct of the defendant. In Jallco Ltd v Owoniboys Tech Services Ltd (1995) 4 NWLR g (Part 391) 534 at 547 Honourable Justice Uthman Mohammed, JSC in his lead judgment asked the question “When does time begin to run?” and answered the question thus:– h “This court in the case of Fadare and others v Attorney General of Oyo State (1982) NSCC 52 at 60 referred to the case of Board of Trade v Cayner Irvine and Co. Ltd (1927) AC 610 where it was held ‘Time therefore, begins to run when there is in existence a i person who can sue and another who can be sued, and all facts have happened which are material to be proved to entitle the plaintiff to succeed.’ It is crystal clear from the facts of this case that the respondent had not become aware of the wrong entries in his accounts until in 1980/81. That being the case, the right of j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA Ethiopian Airlines v Afribank Nigeria Plc 255 a action accrued when the respondents’ demand to have his account credited was denied and refused, and this happened in 1980/81. The claim of the respondent is not therefore statute barred.” b It must however be noted that in the Jallco Ltd case cited above, fraudulent concealment was pleaded and proved. In NPA Plc v Lotus Plastics Ltd (2005) 12 SC (Part 1) 19 at 27; (2005) 19 NWLR (Part 959) 158 Mahmud Mohammed, JSC c in dealing with when the cause of action arose, had this to say:– “In the instant case, it is not at all in dispute from the paragraphs of the first respondent’s statement of claim earlier quoted in d this judgment, that the first respondent had a cause of action being the claim for the cost of its bus delivered to the warehouse of the appellant for custody for which appropriate fees had been paid. As to the question when the cause of action arose, both the trial court and the court below relied on paragraphs 10, 11 e and 12 of the statement of claim which revealed that the first respondent was notified of the damage to the bus by a letter dated 20-5-93. The extent of the vandalization of the bus was confirmed to the first respondent by a Cargo Survey Company appointed by its insurers, which examined the bus at the premises f of the appellant on 26-5-93. Thus the facts or combination of facts which gave rise to the right to sue, accrued to the first respondent on 26-5-93 when it became fully aware of the extent of the damage to the bus in terms of cost through the expert cargo g surveyor.” The above finding was however an obiter dictum as the only issue for determination in that appeal was:– “Whether the relationship between the appellant and respondent h comes within the statutory duties of the appellant as laid out by the provisions of section 3(1)(a) of the Nigerian Ports Authority Decree No. 74 of 1993 having regard to the averments in the first respondents’ statement of claim.” i In Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379 at 388 Wali, JSC held thus:– “The appellant was dismissed from the service by the first respondent from 12 December, 1983 the date exhibit ‘A’ was j written as it stated that the termination was with immediate effect.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Agbo JCA 256 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The time would therefore start running against the appellant the a day after exhibit ‘A’ was written and received by the appellant.” (Italics mine.) On the other hand, in Ajibona v Kolawole (supra), the b Supreme Court was called upon to interpret sections 16, 17, 19 and 21 of the Limitation Law, Laws of Lagos State. In his lead judgment at pages 35 and 36, Ogwuegbu, JSC had this to say about the accrual of the cause of action in relation to the knowledge of the plaintiff of the act of the defendant c constituting the cause of action:– “On the reading of the provisions of Limitation Law of Lagos State as a whole, they do not merely deny the right of action, they completely extinguish an existing right at the expiration of 12 d years from the accrual of the right of action ... On a cumulative reading of the entire provisions of the Limitation Law and in particular, Sections 16, 17, 19 and 21 thereof, knowledge on the part of the plaintiff is not a condition precedent. The knowledge of the plaintiff is immaterial. The words of the Limitation Law of e Lagos State are clear and unambiguous and must therefore be accorded their ordinary meaning. Apart from fraudulent concealment of right of action which itself furnishes a cause of action, knowledge cannot be said to be relevant.” f This judgment was followed wholesale by the Supreme Court in Akibu v Azeez (2003) 5 NWLR (Part 814) 643. In fact in Akibu’s case the Supreme Court went further to state that a plaintiff who by reason of his absence from the place g where the trespass occurred is unaware of the trespass cannot use such lack of knowledge as a defence to commence an action outside the limitation period. It is clear from the several Supreme Court decisions h reviewed above that the issue of knowledge as it relates to the act constituting cause of action and the running of time as it relates to limitation statutory provisions is yet to be fully settled. I however feel bound to follow the decisions in Akibu v Azeez (supra) and Ajibona v Kolawole (supra) not i only because the two cases interpreted the provisions of the Lagos Limitation Law of Lagos State which is also the subject of interpretation in this appeal but Akibu v Azeez is the latest decision of the apex court dealing directly with the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA Ethiopian Airlines v Afribank Nigeria Plc 257 a issue in contention in this appeal. Furthermore and more importantly, a critical study of the statement of claim of the appellant will show that nowhere in its pleadings did the b appellant disclose the day, month or year when it got to know that the respondent did not remit money to its account as instructed. The only thing it pleaded was that it was while reconciling its accounts at its headquarters that it was discovered the money was not remitted. The first respondent c was clearly in the right in asserting that the cause of action had been avoided by the effluxion of time. This appeal is dismissed with N5,000 costs to each of the d respondents.

SALAMI JCA: I read before now the judgment of my learned brother, Agbo, JCA and agree with the conclusion arrived thereat. e The first respondent successfully sought and obtained a relief for the Suit to be dismissed on the ground that the action was time-barred. The appellant being aggrieved has f appealed to this Court on two grounds of appeal from which a sole issue was formulated. It is more than settled that when competence of suit is in issue, it is the plaintiff’s action as signified either on the writ g of summons or the statement of claim. Yalaju Amaye v AREC Ltd (1990) 4 NWLR (Part 145) 422; Kotoye v Saraki (1994) 7 NWLR (Part 357) 414, 425 and 466; Akinfolarin v Akinnola (1994) 3 NWLR (Part 335) 659 and Ajakaiye v h Military Governor Bendel State (1993) 9 SCNJ 242. Though appellant did not disclose when it became aware that the first respondent did not issue the bank draft to its order nevertheless it creates strong impression from the face of its pleading that it was very well seised of the development. i This picture can be garnered from paragraphs 4, 5, 6, 7, 8, 9, 10, 11 and 12 of the statement of claim which are recited immediately hereunder:– “4. On or about 2/4/90 the plaintiff instructed the first defendant j to issue a draft on the sum of N477,000.00 to the order of the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Salami JCA 258 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

plaintiff and to be paid into the plaintiff’s account with the a said defendant. 5. The plaintiff avers that though the first defendant issued a Bank Draft No. 009126 dated 2/4/90, the draft was issued to b the order of Continental Bank Plc contrary to the plaintiff’s instruction. 6. The plaintiff avers that the said draft was delivered to the second defendant on 4/4/90 and the same was duly acknowledged by the second defendant by endorsing its c stamp on the said draft. The plaintiff will rely on a copy of the said draft at the trial of this action. 7. The plaintiff avers that in the process of reconciling the plaintiff’s account at it Head Office in Addis Ababa, d Ethiopia the said sum of N477,000.00 was discovered not to have been credited to the plaintiff’s account. 8. The plaintiff wrote a letter dated 1/9/94 to the first defendant for a clarification on the debt sum of N477,000.00. The plaintiff shall rely on the said letter at the trial of this action. e 9. In reply to the plaintiff’s letter referred to in paragraph 8 above the first defendant by its letter dated 1/11/94 purportedly debited the plaintiff’s account to the draft issued to the second defendant. The plaintiff will rely on the said f letter at the trial of this action. 10. The plaintiff consequently wrote a letter dated 20/4/95 to the second defendant requesting for a clarification of the said sum N477,000.00 and a detailed statement of account. The plaintiff will rely on the said letter at the trial of this action. g 11. The plaintiff avers that the second defendant in its letter dated 11/5/95 to the first defendant demanded for a copy of the draft and evidence of acknowledgment of its receipt by the second defendant. The plaintiff will rely on the said letter h at the trial of this action. 12. By another letter dated 16/8/95 to the second defendant the plaintiff attached a copy of the said draft with evidence of second defendant’s acknowledgment of receipt of same. The second defendant is hereby given notice to produce the said i letter at the trial of this action.” The facts set out above clearly demonstrate that the appellant is not candid. It has been economical with the truth. Clearly it is being deceptive and hedging. It cleverly j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Salami JCA Ethiopian Airlines v Afribank Nigeria Plc 259 a avoided to aver to the date it was reconciling its account in Ethiopia. It equally avoided disclosing the source and time of receipt of the material it was using to reconcile its b account. It knew the date first defendant issued the draft and forwarded it to the second defendant. So also was it aware of the receipt of the draft and acknowledgment thereof by the second defendant. Indeed it had a copy of the draft endorsed c with proof of second defendant or second respondent receiving the draft. How else can one explain its providing second respondent with a copy of the draft as well as endorsement of acknowledgment when second respondent sought a copy from the first respondent. The reasonable and d irresistible inference that can and must be drawn from the averments contained in the paragraphs of the statement of claim recited in this judgment is that the appellant had knowledge of the transaction right from its inception. The e failure to disclose the time of knowing that its instruction was not carried out was part of the grand deception. There is substance in the submission of the learned Counsel for appellant that the relationship between the f parties being that of banker and customer the transaction is found on simple contract. The dispute falls within the contemplation of section 8(1)(a) of Limitation Law Cap 118 of the Laws of Lagos State of Nigeria, 1994. It reads thus:– g “(1) The following actions shall not be brought after the expiration of six years from the date on which the cause of action accrued. (a) actions founded on simple contract.” h The appellant’s ominous silence on when it knew the draft was wrongly paid or diverted is deliberate. It is intended to mislead the Court into finding that the suit was not yet statute-barred. The appellant was aware of the first i respondent not drawing the draft to its order on or about 2 April, 1990 nevertheless it did not bring an action for remedy until which is frivolous by which time the suit was bad for effluxion of time. See Fadare and others v Attorney j General of Oyo State (1962) NSCC 52, 60; (1982) 7 SC 60;

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Salami JCA 260 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Board of Trade v Cayner Irvine and Co Ltd (1927) AC 610 a and Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379. The appellant having known that his draft was not drawn in accordance with his instruction b nevertheless failed or neglected or refused to take action has himself to blame. It is too late for it to cry over spilled milk. Accordingly, I find no merit in this appeal and agree that it should be dismissed. I abide by the consequential orders, c including the order as to costs proposed in the lead judgment of my learned brother, Agbo, JCA.

GALINJE, JCA: I have read before now the judgment of my d learned brother Agbo, JCA and I agree with the reasoning and conclusion therein. A statute of limitation begins to run from the moment the cause of action arose. It is immaterial that a party was absent e from jurisdiction or that there was no court within the jurisdiction to entertain the suit. This therefore presupposes that knowledge of the accrual of the cause of action is immaterial. For the purpose of instituting an action in court, f time begins to run from the date the cause of action accrues. See Sanda v Kukawa Local Government (1991) 2 NWLR (Part 174) 379; Solomon v African Steamship (1928) 9 NLR 99. g When a statute of limitation prescribes a period within which an action must be commenced, legal proceedings cannot be properly or validly instituted after the expiration of the prescribed period. h Odubeko v Fowler (1993) 7 NWLR (Part 308) 637; and Ekeogu v Aliri (1991) 3 NWLR (Part 179) 258. In the present appeal, the appellant, Ethiopian Airlines after having instructed the first respondent to raise a draft in its i favour and pay same into its account with the second respondent, had a duty to find out whether its instruction was validly carried out. This it refused to do until it was caught up by section 8(1)(a) of the Limitation Law of Lagos j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Galinje JCA Ethiopian Airlines v Afribank Nigeria Plc 261 a State Cap 118 Laws of Lagos State of Nigeria, 1994. By the operation of the Law aforesaid, the appellant cannot validly commence legal proceedings against the respondents herein. b This is so because the law requires parties to every transaction to be vigilant. Clearly this is an area where equity helps those who are vigilant. For this reason and the more detailed reasons set out in c the judgment of my learned brother this appeal is dismissed by me also. I abide by all the consequential orders made therein including the order as to cost. Appeal dismissed.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION)

262 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

a Bunnex (Nig) Ltd v Ivory Merchant Bank Ltd

FEDERAL HIGH COURT OF NIGERIA, LAGOS DIVISION b ABUTU J Date of Judgment: 2 JUNE, 2006 Suit No.: FHC/L/CS/137/92

Banking – Bank failing to advance or disburse loan as agreed – Right of borrower c Banking – Loan recovery – Need for bank to tender bank statement Evidence – Agreement reduced to writing – Varying of by d oral testimony – Whether permissible – Section 131(1) Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 e Facts The plaintiff and the defendant were in banker/customer relationship. The plaintiff secured a loan from the defendant and agreement was reached between them which agreement f was in writing. In later dispute between them, the plaintiff averred that apart from the written agreement, there was also an oral agreement which of course would vary the written g agreement. This oral agreement, the defendant denied. The plaintiff therefore sued the defendant for breach of contract, whilst the defendant counter-claimed for amount owing. h To the counter-claim, the original plaintiff submitted that as at the trial no bank statement was tendered and the defendant/plaintiff had not proved its case. i Held – 1. The absence from the evidence of the plaintiff’s bank statement is fatal to the counter-claim in this case. The defendant has to prove its case by tendering the j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION)

Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 263 a plaintiff’s bank statement of account to demonstrate to the court how the sum claimed has been arrived at. Without the bank statement there can be no proof of the b principal and the accrued interest charges. (Olorunfemi v Nigerian Education Bank Ltd (2003) 5 NWLR (Part 812) 1 at pages 24 – 25; EIB Building Society Ltd v Adebayo (2004) FWLR (Part 193) 223 at 247 – 248 and c Union Bank of Nigeria Plc v Ishola (2002) FWLR (Part 100) 1253 at 1280 refer.) 2. The right of the borrower to sue for damages for the failure of the bank to advance or disburse the loan is d undoubted. The right to sue for damages is a right predicated on the existence of a term of the agreement and a breach of the term by the defendant. (Nigerian Bank for Commerce and Industry v Integrated Gas (Nig) Ltd (2005) 4 NWLR (Part 916) 617 at 651 and 652 e refer.) 3. The law as settled by the authorities is that when an agreement is reduced to writing the contract document f speaks for itself and oral testimony is inadmissible to vary, add or take away from the contents of the contract document. (Nigerian Industrial Development Bank Ltd v Olalomi Industries Ltd (2002) 5 NWLR (Part 761) 532 at 555; Bijon (Nig) Ltd v Osidarokwo (1992) 6 NWLR g (Part 249) 643 at 649 refer.) 4. Per curiam “In the present case the ipse dixit of PW1 alone, without h more cannot vary, add to or take away from the contents of Exhibit 11C and the other documents in this case. It is my firm view that it has not been proved that there existed between the parties an agreement to the effect that the execution of the spare parts importation contract with the i proceeds of the rubber exportation contract is a condition precedent to the performance of the plaintiff’s obligation under the loan transaction between the parties. It seems to me if such in agreement was reached by the parties the correspondence between the parties after the execution of j Exhibit 11C should have reflected the oral agreement.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION)

264 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Exhibits 12, 13, 13A, 13B and 14 were all written after the a execution of Exhibit 11C and no mention has been made of the oral agreement in this documents. I hold that it has not been proved that any such oral agreement did exist between the plaintiff and the defendant.” b Finding for the defendant whilst dismissing the counter- claim.

Cases referred to in the judgment c Nigerian Aderounmu v Aderounmu (2003) 2 NWLR (Part 823) 1 A-G Lagos State v Cus Ltd (2002) 14 NWLR (Part 786) 105 d Akalonu v Omokoro (2003) 8 NWLR (Part 821) 190 Amira (Nig) Ltd v Mal (Nig) Ltd (2001) 17 NWLR (Part 741) 460 e Asogwu v Chukwu (2003) 4 NWLR (Part 811) 540 Bijon (Nig) Ltd v Osidarokwo (1992) 6 NWLR (Part 249) 643 f Bodi v Agyo (2003) 16 NWLR (Part 846) 305 EIB Building Society Ltd v Adebayo (2004) FWLR (Part 193) 223 Green Finger Agro Industries Ltd v Yusufu (2003) 12 g NWLR (Part 835) 488 International Nigerbuild Construction Co Ltd v Giwa (2003) 13 NWLR (Part 836) 69 h Isiaka v Zwingina (2003) 6 NWLR (Part 817) 560 Jadesinmi v Egbe (2003) 10 NWLR (Part 827) 1

Maya v Oshuntokun (2001) 11 NWLR (Part 723) 62 i Nigerian Bank for Commerce and Industry v Integrated Gas (Nig) Ltd (2005) 4 NWLR (Part 916) 617 Nigerian Industrial Development Bank Ltd v Olalomi Industries Ltd (2002) 5 NWLR (Part 761) 532 j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION)

Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 265 a Okonkwo v Co-operative and Commerce Bank Plc (2003) 8 NWLR (Part 822) 47 Okpolaeke v NEPA (2003) 14 NWLR (Part 846) 383 b Olorunfemi v Nigerian Education Bank Ltd (2003) 5 NWLR (Part 812) 1 Owoniboys Technical Services Ltd v UBN Ltd (2003) 15 NWLR (Part 844) 545 c RCC (Nig) Ltd v Edomwonyi (2003) 4 NWLR (Part 811) 513 SPDC Ltd v Adamkwe (2003) 11 NWLR (Part 832) 533 d Summit Financial Co. Ltd v Iron Baba and Sons Ltd (2003) 17 NWLR (Part 848) 89 Union Bank of Nigeria Plc v Ishola (2002) FWLR (Part 100) 1253 e Statute referred to in the judgment Evidence Act, sections 131(1), 132, 134 and 136 f Judgment ABUTU J: The plaintiff claims as per the amended statement of claim dated 10 January, 1997 the following reliefs:– 1. The sum of N695,791.65 being the contract sum for g Delta Steel contracts. 2. The sum of 37,989 British Pounds Sterling ($314,883.80) being the remitted sum representing h 90% of 42,210 British Pounds Sterling. 3. Interest at such rate and for such period as the court thinks fit. 4. An order of injunction restraining the defendants from i charging interest on facilities in breach of agreement and/or contract. 5. An order for the return of the plaintiff’s director’s certificate of occupancy No. BDSR861B to the j plaintiff.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 266 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The statement of claim is made up of 17 paragraphs. a The defendant’s amended statement of defence and counter-claim dated 17 February, 2002 is made up of 21 paragraphs, while the plaintiff’s reply to the statement of b defence and defence to the counter-claim dated 10 November, 1993 is made up of 31 paragraphs. The amended statement of claim, the amended statement of defence and counter-claim and the reply to the statement of defence and c defence to the counter-claim dated 10 November, 1993 constitute the pleadings in this case on the basis of which evidence was led on both sides. To prove the allegations of fact contained in the amended d statement of claim the reply to the statement of defence and the defence to the counter-claim the plaintiff called one witness who testified as PW1. e PW1, Obukowho Ogbone in his sworn testimony said the plaintiff is an exporter and an importer of rubber lumps. He is a director of the plaintiff. Sometime in March, 1990 he approached the defendants for an overdraft facility of N100,000 and N50,000 for the plaintiff’s warehouse. The f plaintiff then had a contract to supply spare parts of machinery for Delta State Rolling Mills, Aldaja. He submitted the agreements he had with some persons as well as wire cable in connection with the business of exportation g of rubber lumps to the defendant. He also submitted a purchase Order along with a Proforma Invoice issued by Delta Steel Rolling Mills Aldaja to the defendant. He also submitted a certificate of occupancy to the defendant. PW1 h produced the proforma invoice, the purchase order and a copy of the cable wire and the documents were tendered and admitted as exhibits “1”, “2” and “3” respectively. In his further testimony PW1 said he gave the documents i relating to the two contracts to the defendant. He then requested the defendant to finance the contracts. The manager of the bank agreed to finance the contracts. One of the contracts was for export of rubber and the other one was j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 267 a for the importation of spare parts from Germany. The contract for importation of spare parts would require N695,701.65 while the contract for exportation of rubber b would require 42,210 British Pounds Sterling. The defendant agreed to finance the rubber exportation contract first. The parties executed a loan agreement and a debenture deed. PW1 produced the loan agreement, the mortgage agreement c and the debenture deed and the three documents were tendered and admitted as exhibits 4, 5 and 6 respectively. PW1 said after the agreements have been prepared he was given N100,000 for buying rubber and N500,000 warehouse d financing. The N100,000 was given to him once while the N500,000 was given to him in bits. The defendant gave him a total of N600,000. He used the N600,000 to buy rubber. The defendant’s warehouse was at Mile 2, Lagos. The e manager of the defendant showed him the warehouse. The overseas customer of the plaintiff required a maximum of 144 metric tons of rubber and a maximum of 132 metric tons. The original letter of credit in which the quantity of the rubber required was stated is in the possession of the f defendant. He was to buy the rubber from Sapele and to bring it to the defendant’s warehouse at Mile 2, Lagos. With the N100,000 he bought rubber of 126 metric tons. He took the rubber to the defendant’s warehouse at Mile 2, Lagos. g He then applied for more loan (sic) to enable him supply the required quantity of rubber. He found out after one month that the defendant had exported the 126 metric tons. Shortly he learnt that the sum of 2,000 British Pounds Sterling h representing 90% of the cost of the rubber was paid to the bank. The sum of 42,210 British Pounds sterling was to be paid for the 132 metric tons. When he renewed his request for more loans he was told i that he must endorse a tripartite agreement, mortgage agreement and a loan agreement before the loan could be given to him. He refused to sign the agreement because the conditions stated in the agreements were different from the j conditions in the earlier agreements. The bank refused to

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 268 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) give the plaintiff any further loan as a result of which the a plaintiff could not supply the minimum quality of rubber required. He instructed his solicitor to write a letter to the b defendant. PW1 produced a copy of the letter and it was tendered and admitted as exhibit “7”. PW1 also produced a copy of the bill of lading given to his solicitor by SGS Inspection Services Nig. Ltd and the document was tendered c and admitted as exhibit “8”. PW1 produced a copy of the letter his solicitor wrote the overseas customer of the plaintiff and the reply to the letter and the documents were tendered and admitted as exhibits “9” and “10”. d In his further testimony PW1 said he instructed his solicitor to institute an action against the defendant. As a result of the defendant’s refusal to give the plaintiff the money paid for the rubber, the plaintiff could not supply the e spare parts to the Delta Steel Rolling Mills, Aladja. The plaintiff is not owing the defendant. The defendant did not give him notice of the exportation of the rubber. SGS Inspection Services Nig. Ltd was an agent of the defendant f in the transaction. PW1 prayed the court to grant all the reliefs of the action and to dismiss the counter-claim. Under cross-examination PW1 said he is a director of Equator Products (Nig.) Ltd PW1 identified four documents g shown to him as the letters he signed and the documents were tendered and admitted as Exhibits 11, 11A- 11C. In his further evidence PW1 said the bank manager, Mike h verbally told him that the bank will finance the rubber shipment business because there was foreign exchange in the transaction. There is no written undertaking to finance the business. He signed a document given to him by the defendant to sign and he authorised the defendant to pay the i proceeds of the sale of the rubber into the account of the plaintiff with the bank. He authorised the bank to utilize the proceeds in the execution of the contract. PW1 identified one letter shown to him as the letter he signed and the letter j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 269 a was tendered and admitted as exhibit “12”. He also identified his signature on three letters shown to him and the documents were tendered and admitted as exhibits “13”, b “13A” and “13B”. PW1 also identified one document shown to him to be the tripartite agreement and the document was tendered and admitted as exhibit “14”. Two other documents were tendered and admitted through PW1 as exhibits “15” c and “16”. A personal guarantee signed by PW1 was also tendered and admitted through him as exhibit “17”. At the end of the evidence of PW1 the plaintiff closed its case. The defendant in rebuttal called one witness who d testified as DW1. DW1, Victor Nwaogugu in his sworn testimony said he was a staff of the defendant. The defendant has been liquidated. The plaintiff was a customer of the defendant. e The defendant gave an overdraft facility of N600,000 to the plaintiff for export of rubber by the plaintiff. Out of the N600,000 the sum of N500,000 was warehouse/warrant refinancing export facility while N100,000 was an overdraft f facility. The conditions for the facility are in the offer/acceptance letter admitted as exhibit “9C” in this case. The subsequent application for a facility by the plaintiff was not approved because the plaintiff failed to comply with the g conditions attached to the facility earlier granted. The importer of the goods paid 90% of the agreed sum to the plaintiff through the plaintiff’s domiciling account with the defendant. By a letter dated 4 March, 1990 the defendant h was authorised to set off the loan. The 90% of the agreed sum paid was used to offset the loan. There was an application dated 6 June, 1990 for a loan of N2 million. DW1 produced the application and it was i tendered and admitted as exhibit “19”. DW1 also said that there was a letter written by the importer to state that there was a disparity between the quantity of the goods and the price. The bank discovered that the money was not enough. j The shipping documents were sent to the foreign buyer of

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 270 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) the rubber. Two letters produced by DW1 were tendered and a admitted as exhibits “20” and “21”. In his further testimony DW1 said the time for paying the loan expired on 14/3/91. The defendant wrote several letters b to the plaintiff to demand payment of the loan. DW1 produced three letters which were tendered and admitted as exhibits “22”, “23” and “23A”. DW1 said the interest rate mutually agreed on is as contained in exhibit “11C”, the c letter of offer. As at 2 April, 1991 the outstanding loan was N202,782.66. As at 24/6/90 the outstanding balance was N683,652.58. On 22/6/90 the defendant enforced its right of set-off by taking part of the export proceeds which was d N314,883.80. The outstanding balance then became N368,768.78. There was another set-off on 16/7/90. Part of the export proceeds to the tune of N219,355.14 was set-off by the defendant. As at the date the facility expired on 14 e March, 1991 the outstanding balance was N196,070.56. Exhibit “22” was then written to the plaintiff to demand payment of the balance. DW1 produced another letter dated 22/4/94 written to demand payment of the loan and the letter was tendered and admitted as exhibit “24”. f In his further testimony DW1 said on the 22/12/2000 the banking licence of the defendant was revoked. The last bank statement issued to the plaintiff was issued on 30/6/92. On 10/3/92 the plaintiff wrote to the defendant to request for g another facility. The defendant replied to the application. DW1 produced the letter dated 10/3/92 and the reply dated 22/4/92 and the documents were tendered and admitted as exhibits “25” and “26” respectively. DW1 said as at 31/3/92 h the outstanding balance was N265,245.18. DW1 prayed the court to dismiss the plaintiff’s claim and to enter judgment for the defendant as per the counter-claim. Under cross-examination DW1 said he was a staff of the i defendant up to the time the defendant’s banking licence was withdrawn. He is working with the liquidator of the defendant. He was not a management staff of the defendant. He was an accountant officer. He did not take part in the j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 271 a negotiations between the plaintiff and the defendant. It is not true that the defendant refused to give the plaintiff money to supply 132 metric tons of the rubber. The defendant did not b breach the agreement between the parties. At the end of the evidence of DW1 the defendant closed its case. At the instance of Counsel for both sides the court directed parties to file their written address. Both sides were c given 30 days. The learned Counsel for the defendant in the defendant’s written address filed on 9 November, 2005 drew the attention of the Court, in the introductory part of the address, d to the claim of the plaintiff, the defence and the counter- claim and the evidence on both sides. She then submitted that the issues for determination are:– e 1. Whether the agreement between the parties is an oral agreement; 2. Who are the parties to the tripartite agreement in Exhibit “14” and whether SGS Inspection Services f Nig. Ltd is an agent of either of the parties; 3. Whether the defendant could have prevented the remittance of the 10% of the proceeds to the plaintiff; g 4. Whether the plaintiff has paid the loan to the defendant; and 5. Whether the plaintiff is entitled to award of damages and costs. h Learned Counsel submitted on issue 1 that the plaintiff has not proved its assertion that there was an oral contract between it and the defendant. She contended relying on Owoniboys Technical Services Ltd v UBN Ltd (2003) 15 i NWLR (Part 844) 545; Asogwu v Chukwu (2003) 4 NWLR (Part 811) 540; Bodi v Agyo (2003) 16 NWLR (Part 846) 305; Okpolaeke v NEPA (2003) 14 NWLR (Part 846) 383; Summit Financial Co Ltd v Iron Baba and Sons Ltd (2003) j 17 NWLR (Part 848) 89 and International Nigerbuild

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 272 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Construction Co Ltd v Giwa (2003) 13 NWLR (Part 836) 69 a that the law is that he who asserts must prove the truth of his assertion. She urged the Court to come to the conclusion that the contract in this case was reduced to writing. She b submitted that where a contract or an agreement is reduced to writing, the plain simple and unambiguous words used in the contract are to be construed to determine whether either of the parties has breached any of the terms of the contract. c She cited Summit Finance Company Ltd v Iron Baba and Sons Ltd (supra); Aderounmu v Aderounmu (2003) 2 NWLR (Part 823) 1; A-G Lagos State v Cus Ltd (2002) 14 NWLR (Part 786) 105; Isiaka v Zwingina (2003) 6 NWLR (Part d 817) 560; Jadesinmi v Egbe (2003) 10 NWLR (Part 827) 1 and Okonkwo v Co-operative and Commerce Bank Plc (2003) 8 NWLR (Part 822) 47 in support of her submission. She urged the Court to hold that there is no evidence which e shows the existence of any oral agreement between the parties. She urged the Court to accept the evidence of DW1 to the effect that the only contract between parties is the one evidenced by exhibits “4”, “5” and “6”, exhibit “14” and some of the documents tendered in this case. She submitted f that the plaintiff has woefully failed to prove the existence of an oral contract, the alleged breach of which constitutes the plaintiff’s cause for the complaint in this action. She urged the Court relying on Green Finger Agro Industries Ltd g v Yusufu (2003) 12 NWLR (Part 835) 488 at 492 to hold that the plaintiff having failed to prove that an oral contract exists between it and the defendant, the plaintiff’s claim has not been proved. She urged the Court to accept the h documentary evidence in this case and to hold on the basis of the exhibits, particularly exhibits “3”, “8”, “13”, “14”, “16”, “17”, “18”, “9”, “11”, “11A” – “11C”, “12”, “19”, “20” and “25” that the agreement between the parties is a i written agreement, evidenced by the documents tendered in this case, particularly exhibit “11C”. On issue 2 learned Counsel submitted referring to pages 1, 2, 3 and 4 of exhibit “14”, the tripartite agreement that at j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 273 a the time of shipment the defendant/warrant holder no longer had anything to do with SGS Inspection Services (Nig) Ltd. She drew the attention of the court to exhibits “13” and b “13A” and submitted that there is an admission by the plaintiff that the 10% per (sic) balance was not remitted because the certificate was not authenticated and not as a defect in the goods. The duty to ensure that the certificate is c authenticated, learned Counsel, contended is that of Euronet to which the SGS Inspection Services (Nig) Ltd is agent, not that of the defendant. On issue 3 learned Counsel submitted that there is no d evidence which shows that the defendant prevented the remittance of 10% of the proceeds to the plaintiff. On issue 4 learned Counsel submitted that having regard to the evidence of DW1 and exhibits “12”, “13”, “18” and e “23A” it has been proved that at the date the suit was filed the outstanding balance was N291,702.75. She referred to exhibit “13” paragraph 6 where, according to her, the plaintiff conceded that as at May, 1991 the plaintiff was f owing the defendant over N120,000. She urged the Court to accept the evidence of DW1 and to enter judgment for the defendant as per the counter-claim. On issue 5 learned Counsel submitted that the defendant g has proved that the sum of N291,702.75 is outstanding unpaid. She submitted that having regard to the admission in exhibit 13 that the plaintiff was owing the defendant N120,000, the plaintiff has a duty to prove in this case that that sum of N120,000 has been paid to the defendant. She h cited Akalonu v Omokoro (2003) 8 NWLR (Part 821) 190 in support of her submission. Learned Counsel submitted relying on SPDC Ltd v Adamkwe (2003) 11 NWLR (Part 832) 533 and RCC (Nig) Ltd v Edomwonyi (2003) 4 NWLR i (Part 811) 513 at 519 that the evidence of DW1 has not been materially challenged and that the court ought to hold that the counter-claim has been proved as required by law. She urged the Court relying on Maya v Oshuntokun (2001) 11 j NWLR (Part 723) 62 at 69 and Amira (Nig) Ltd v Mal (Nig)

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 274 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Ltd (2001) 17 NWLR (Part 741) 460 to hold that the a defendant is entitled to judgment as per the counter-claim together with costs. She urged that the plaintiff’s suit be dismissed. b The learned Counsel for the plaintiff in the plaintiff’s written address filed on 6 December, 2005 drew the attention of the Court in the introductory part of the written address, to the reliefs of the action. He then submitted that c the issues for determination are:– 1. When (sic) the rubber exportation financing agreement contract in this case is based on a written agreement or an oral agreement; d 2. Whether there is evidence that the defendant breached the contract; 3. Whether there is evidence that the plaintiff is indebted e to the defendant to the tune of N291,702.75 at the close of business on 30 June, 1992; and 4. Whether the defendant has suffered any damages arising from the credit facility. f Learned Counsel submitted on issue 1 that part of the agreement between the parties was in writing while part was oral. He referred to exhibits “1”, “2” and “3” which he submitted are part of the written agreement. The oral aspect g of the agreement, learned Counsel submitted is the agreement between the plaintiff’s representatives and the defendant’s representatives that the plaintiff will only be bound by the contract of the exportation of the rubber upon h the execution of the contract of importation of spare parts from the proceeds of the export contract. Learned Counsel contended that by the non-execution of exhibits “4”, “5” and “6” and the payment of the loan on N500,000 in installments it is clear that the liabilities of the parties is subject to the i oral agreement that the proceeds from the rubber exportation contract could be used to execute the spare parts importation contract. He contended that exhibit “11C” alone does not govern the relationship between the parties to the loan j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 275 a transaction. He urged the Court relying on section 132 of the Evidence Act to hold that the oral contract is part of the contract and that the execution of the contract of importation b of spare parts from the proceeds of the rubber exportation financing contract is part of the terms of the contract between the parties. On issue 2 learned Counsel submitted that by refusing to c grant further or additional credit facility to the plaintiff to deliver up to 144 metric tons of rubber constitutes a breach of the credit facility agreement between the parties. On issue 3 learned Counsel submitted that the failure of d the defendant to tender the plaintiff’s bank statement of account is fatal to the counter-claim which is for the principal sum and accrued interests thereon. He cited Union Bank of Nigeria Plc v Ishola (2002) FWLR (Part 100) 1253 e at 1280 – 1281 and EIB Building Society Ltd v Adebayo (2004) FWLR (Part 193) 223 at 247 – 248 in support of his submission. He urged the Court to hold that the defendant has not discharged its burden of proof as required by f sections 134 and 136 of the Evidence Act. He urged that the counter-claim be dismissed. The learned Counsel for the defendant in the defendant’s reply address filed on 19 January, 2006 submitted that if g there was any oral agreement between the parties the correspondence between the parties after the execution of exhibit “11C” should have revealed such oral agreement. She submitted that exhibit “11C” is the agreement which h governs the relationship of the parties to the loan agreement in this case. Learned Counsel submitted that notwithstanding the absence from the evidence of the plaintiff’s bank statement i the admission by the plaintiff is exhibit “13A” and the failure of the plaintiff to raise any objection to the outstanding balance stated in the various demand letters show that the amount claimed is the amount outstanding j unpaid.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 276 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The foregoing is a summary of the evidence and the a submissions of Counsel for both sides in this case. The issues of fact in this case are of a narrow compass since it is not in dispute that the loan of N600,000 was given to the b plaintiff by the defendant. The plaintiff’s claim that there was an oral agreement to the effect that the proceeds of the rubber exportation contract would be used to execute the spare parts importation contract is the main point of c divergence in this case. The main questions for determination seem to me to be the following questions:– 1. Whether the plaintiff has proved the existence of an oral agreement between the parties to the effect that d the importation of the spare parts from the proceeds of the rubber exportation contract was a condition precedent to the performance of the plaintiff’s obligation under the rubber exportation financing e credit facility. 2. Whether the defendant failed to perform any of its obligations under the rubber export financing credit facility agreement between it and the plaintiff. f The claim in this case is for breach of a loan contract. The right of the borrower to sue for damages for the failure of the bank to advance or disburse the loan is undoubted. See Nigerian Bank for Commerce and Industry v Integrated Gas g (Nig) Ltd (2005) 4 NWLR (Part 916) 617 at 651 and 652. The right to sue for damages is a right predicated on the existence of a term of the agreement and a breach of the term by the defendant. h In this case only the PW1 testified that there was an oral agreement which in effect varied the contents of exhibit “11C” and other documents evidencing the loan transaction in this case. The law as settled by the authorities is that when i an agreement is reduced to writing the contract document speaks for itself and oral testimony is inadmissible to vary, add or take away from the contents of the contract document. See Nigerian Industrial Development Bank Ltd v j

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J Bunnex (Nig.) Limited v Ivory Merchant Bank Limited 277 a Olalomi Industries Ltd (2002) 5 NWLR (Part 761) 532 at 555 and Bijon (Nig) Ltd v Osidarokwo (1992) 6 NWLR (Part 249) 643 at 649 and section 131(1) of the Evidence b Act. In the present case the ipse dixit of PW1 alone, without more cannot vary, add to or take away from the contents of exhibit “11C” and the other documents in this case. It is my c firm view that it has not been proved that there existed between the parties an agreement to the effect that the execution of the spare parts importation contract with the proceeds of the rubber exportation contract is a condition d precedent to the performance of the plaintiff’s obligation under the loan transaction between the parties. It seems to me if such in agreement was reached by the parties the correspondence between the parties after the execution of exhibit “11C” should have reflected the oral agreement. e Exhibits “12”, “13”, “13A”, “13B” and “14” were all written after the execution of exhibit “11C” and no mention has been made of the oral agreement in this documents. I hold that it has not been proved that any such oral agreement did f exist between the plaintiff and the defendant. The next question is whether it has been proved that the defendant failed to perform any of its obligations under the loan transaction. The withholding of the 90% of the g proceeds of the rubber and the non-remittance of the 10% of the proceeds constitute the cause for the complaint of the plaintiff in this case. The evidence of DW1 which I accept and exhibit “13A” shows that the defendant cannot be held h responsible for the non-remittance of the 10% of the proceeds from the sale of the rubber. The withholding of the 90% of the proceeds is, having regard to the stipulation on page 2 of exhibit “11C” relating to security, not contrary to i the agreement. On the whole I hold that it has not been shown that the defendant breached any provision of exhibit “11C”. I hold that the claim has not been proved. The claim fails and the j plaintiff’s action is hereby dismissed.

[2004 – 2006] 13 N.B.L.R. (PART III) (FEDERAL HIGH COURT, LAGOS DIVISION) Abutu J 278 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Counter-claim a The defendant claims as per the counter-claim dated 17 February, 2000 the following reliefs:– a. of the sum of N291,702.75 being balance due to the b defendant from the plaintiff on account of credit facility of N600,000 granted to the plaintiff on 28 February, 1990; b. interest on the judgment debt at the rate of 42% per c annum until judgment is given in the suit; c. interest at the rate of 10% per annum from the date of judgment until the final liquidation of judgment d debt; d. costs of this suit. The evidence on both sides show that the sum of N600,000 was granted to the plaintiff by the defendant as a credit e facility on 28 February, 1990. The claim in this case is predicated on the credit facility. The claim is for the principal sum and the accrued interest charges. It seems to me the absence from the evidence of the f plaintiff’s bank statement is fatal to the counter-claim in this case. The defendant has to prove its case by tendering the plaintiff’s bank statement of account to demonstrate to the court how the sum claimed has been arrived at. Without the g bank statement there can be no proof of the principal and the accrued interest charges. See Olorunfemi v Nigerian Education Bank Ltd (2003) 5 NWLR (Part 812) 1 at 24 – 25; EIB Building Society Ltd v Adebayo (supra) at 247 and h Union Bank of Nigeria Plc v Ishola (supra) at 1280 where the Court of Appeal per Amaizu, JCA stated thus:– “It is my view that the evidence adduced by the Appellant in the lower court is not sufficient to entitle it to judgment in its counter- claim. For the appellant to succeed in its counter-claim it should i have tendered ledger account of the Respondent and any other book in support of the Respondent’s indebtedness.” On the whole I hold that the counter-claim has not been proved. The counter-claim is dismissed. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Standard Trust Bank Limited v Interdrill Nigeria Limited 279 a Standard Trust Bank Ltd v Interdrill Nigeria Ltd b COURT OF APPEAL, BENIN DIVISION ADEREMI, ABBA-AJI, SHOREMI JJCA Date of Judgment: 6 JUNE, 2006 Suit No.: CA/B/143/2004

Banking – Banker/customer relationship – Nature of c Banking – Evidence of officer of bank – Not in employment at the time of transaction – Whether admissible Banking – Interest – Definition of – Failure to plead agreed d interest rate – Effect of Evidence – Competent witness – Section 155(1) Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 Evidence – Of officer of bank – Not in employment at the e time of transaction – Whether admissible – Who is

Facts This is an appeal against the judgment delivered on 5 f December, 2003 in the High Court of Justice, Delta State, Warri Judicial Division in Suit No. W/76/2001: Standard Trust Bank Ltd v Interdrill Nigeria Limited and Joseph Bogwu in which the trial Judge dismissed the plaintiff’s case g in toto. The plaintiff (hereinafter referred to as the appellant) had by a writ of summons marked by the plaintiff/appellant “Undefended List” claimed against the defendants (hereinafter referred to as the respondents) jointly and h severally as follows:– “1. The sum of N17,835,802.67 (Seventeen Million, Eight Hundred and Thirty-Five Thousand, Eight Hundred and Two Naira, Sixty-Seven Kobo) being the outstanding debit i balance in the first defendant’s account with the plaintiff as at 2 February, 2001 which sum is due to the plaintiff from an overdraft facility granted to the first defendant at the first defendant’s request and guaranteed by the second defendant which sum the defendants have failed neglected, omitted j and/or refused to pay inspite of repeated demands.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

280 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

2. 31% per annum on the said sum of N17,835,802,67 a (Seventeen Million, Eight Hundred and Thirty-Five Thousand, Eight Hundred and Two Naira, Sixty-Seven Kobo) from 3 February, 2001 until judgment and thereafter 10% per annum on the judgment sum until same is fully b liquidated.” The provision of section 155(1) of the Evidence Act reads:– “All persons shall be competent to testify, unless the court c considers that they are prevented from understanding the question put to them, or from giving rational answers to those questions, by reason of tender years, extreme old age, disease, whether of body or mind, or any other cause of the same kind.” The trial Judge dismissed the suit in the main on the ground d that an official of the bank who testified for the bank was not around when the transaction was done. Hence all relevant documents tendered by him were discountenanced. e Being dissatisfied, the plaintiff/applicant appealed to the Court of Appeal.

Held – f 1. By the virtue of section 155(1) of the Evidence Act, all persons including those who are ever interested in the matter are competent witnesses. 2. The mere fact that a bank staff was not around when a g customer’s bank account was opened was not enough to prevent the staff from testifying or giving evidence on customer’s account. 3. It is settled law, that a company such as the respondent h bank herein is a juristic person and can only act through its agents or servants. Any agent or servant can consequently give evidence to establish any transaction entered into by a juristic personality, even, where the i official giving the evidence is not the one who actually took part in the transaction on behalf of the company. Such evidence nonetheless is admissible and will not be discountenanced or rejected as hearsay evidence. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Standard Trust Bank Limited v Interdrill Nigeria Limited 281 a 4. The word “Interest” as applicable to the relationship of banker/customer is a sum of money payable in respect of the use of the banker’s money by the customer which b money is often termed “Principal”. 5. Failure to sufficiently plead that the plaintiff is entitled to an interest rate agreed by both parties will result in failure to get judgment on that interest so claimed. c 6. The position of the law is that the evidence acquired by a witness in the course of his employment is not only relevant but also admissible. d 7. Any employee of a company that is well placed to have personal knowledge of any transaction in which the company is engaged can give evidence of such transaction. Companies are corporate entities. Their existence is a mere legal abstraction. They have no flesh e and blood. They therefore of necessity act through their directors, managers and other officials. Therefore, any manager or official of the company well placed to have personal knowledge of any particular transaction in f which the company is engaged can give evidence of such transaction. 8. While it is part of the duties of a bank to grant g credit/overdraft facilities to its customers, the customer is also duty-bound to pay interest on borrowed/overdraft funds as agreed. The terms of contract between a bank and customer involve obligation on both sides which includes the promise to repay loans and overdraft h facilities granted to the customer. Appeal allowed. i Cases referred to in the judgment Nigerian A-G Enugu State v Omaba (1998) 1 NWLR (Part 532) 83 j Agwuegbo v Kagoma (2000) FWLR (Part 19) 511

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

282 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Bendel Feed and Flour Mill Ltd v NPMB Ltd (2000) 5 a NWLR (Part 655) 29 Boothia Maritime Inc v Fareast Mercantile Co Ltd (2001) FWLR (Part 50) 1713 b Buraimoh v Bamgbose (1989) 3 NWLR (Part 109) 352 Comet Shipping Agencies Ltd v Babbit Ltd (2001) FWLR (Part 40) 1630; (2001) 7 NWLR (Part 712) 442 c Flash Fixed Odds Ltd v Akatugba (2001) FWLR (Part 76) 709 Gever v China (1993) 9 NWLR (Part 315) 97 Kate Enterprises Ltd v Daewoo (Nig) Ltd (1985) 2 NWLR d (Part 5) 127; (1985) 7 SC 1 Mogaji v Odofin (1978) 4 SC 91 NDIC v Ecobank (Nig) Ltd (2003) 11 NWLR (Part 830) 93 e Odulaja v Haddad (1973) 11 SC 357 Poly v Maina (2005) All FWLR (Part 284) 250 Ramanchadani v Ekpeyong (1975) 2 SC 29 f Saleh v Bank of the North Ltd (2006) 6 NWLR (Part 976) 316 The Chairman, NPC v The Chairman Ikere Local Govt and others (2001) FWLR (Part 70) 1466 g Trenco Ltd v African Real Estate Ltd (1978) 4 SC 9 UBN Ltd v Salami (1998) 3 NWLR (Part 543) 538 Yusuf v NTC Ltd (1977) 6 SC 39 h Nigerian statute referred to in the judgment Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, section 155(1) i Counsel For the appellant: Etuwewe (with him Agumor) For the respondent: Ejeh j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION)

Standard Trust Bank Limited v Interdrill Nigeria Limited 283 a Judgment ADEREMI JCA: (Delivering the lead judgment) This is an appeal against the judgment delivered on 5 December, 2003 b in the High Court of Justice, Delta State, Warri Judicial Division in Suit No. W/76/2001: Standard Trust Bank Ltd v Interdrill Nigeria Limited and Joseph Bogwu in which the trial judge dismissed the plaintiff’s case in toto. The plaintiff c (hereinafter referred to as the appellant) had by a writ of summons marked by the plaintiff/appellant “Undefended List” claimed against the defendants (hereinafter referred to as the respondents) jointly and severally as follows:– d “1. The sum of N17,835,802.67 (Seventeen Million, Eight Hundred and Thirty-Five Thousand, Eight Hundred and Two Naira, Sixty-Seven Kobo) being the outstanding debit balance in the first defendant’s account with the plaintiff as at 2 February, 2001 which sum is due to the plaintiff from an e overdraft facility granted to the first defendant at the first defendant’s request and guaranteed by the second defendant which sum the defendants have failed neglected, omitted and/or refused to pay inspite of repeated demands. f 2. 31% per annum on the said sum of N17,835,802,67 (Seventeen Million Eight Hundred and Thirty-Five Thousand, Eight Hundred and Two Naira Sixty-Seven Kobo) from 3 February, 2001 until judgment and thereafter 10% per annum on the judgment sum until same is fully liquidated.” g As I have said, the appellant endorsed the writ as an “Undefended List” and he therefore supported it with a twenty-four-paragraph affidavit setting forth the grounds upon which the claim was based, together with copies of h documents substantiating the claim. Upon the service of the said writ on the respondents they filed a notice of intention to defend the suit supporting it first with an affidavit of 18 paragraphs and by a 6-paragraph further and better affidavit i disclosing their defence. In its opposition, the appellant filed a reply of a paragraph to the said further and better affidavit of the respondents. Sequel to considering these opposing pieces of printed evidence and upon taking the addresses of j their respective Counsel, the Judge in a considered ruling

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 284 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) removed the case from the Undefended List and transferred a same to the General Cause List for hearing and determination. Suffice it to say that on the application of the appellants, the case was transferred to another judge, who b for the purposes of this appeal will henceforth be referred to as the learned trial judge who set the case down for hearing and parties proceeded to leading evidence from 5 August, 2003. It is perhaps necessary to say that the parties led c evidence based on opposing printed depositions they filed. At the conclusion of their evidence and after taking the addresses of Counsel, the learned trial Judge in a considered judgment delivered on 5 December, 2003 ordered a dismissal of the appellant’s suit. In reaching this conclusion, d the learned trial Judge had reasoned:– “The court prefers the evidence of plaintiff that the nature of the transaction was the grant of facility of N20,000,000.00 by the plaintiff to the first defendant by the implied admission of the e defendant first defendant utilised N10,000,000.00 – See paragraph 11 of the affidavit of defendants accompanying the Notice of Intention to defend and see Exhibits 1 and 2 Exhibited to the accompanying affidavit – to the writ. The court finds as a fact that f there was a banker and customer relationship and the facility was granted in cause (sic) of the relationship, See paragraphs 2, 3 and 4 of the affidavit accompanying the Writ of Summons. The Court rejects the defence of the relationship of partnership set up by the defendants, it is a frivolous attempt to defeat the transaction duly g entered into by the plaintiff and the defendant.” The crucial question for the consideration of the Court is whether the plaintiff by the affidavit evidence proved the indebtedness of N17,835,802.67 on preponderance of h evidence. The defendants at paragraph 14 of the affidavit accompanying the notice of intention to defend, denied the interest of 31 % per annum which the plaintiff charged on i the N10,000,000 and the debt of N17,835,802.67 and respectively described same as outrages and imaginative. At paragraphs 13 and 15 of the same affidavit defendants denied the receipt of statement of accounts plaintiff j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Standard Trust Bank Limited v Interdrill Nigeria Limited 285 a allegedly sent to the defendants. Defendants specially denied the rate of interest of exhibit “STB9” exhibited to the affidavit accompanying the writ. The denial of the receipt of b the statement of accounts and the interest rates placed burden on the plaintiff to prove on preponderance of evidence the true interest rates agreed by the parties at the time of the loan transaction. c Exhibit “STB1” exhibited to the affidavit accompanying the writ of summons under interest rate states the interest to be 12% on the aggregate reflecting 20% interest rate on the loan and the 1% as floating above the bank in the prime d lending rate. Other charges were 5% flat per month for arrangement fee and 5% flat per month for management fee. The conditions precedent to draw down were stated in the agreement and the court holds that the same were perfected e by the evidence of the drawing of N10,000,000 out of the facility granted by the plaintiff by the first defendant. The plaintiff at paragraph 10 of its affidavit deposed that it charged prevailing interest rate on the facility. It f particularly at paragraph 11 thereof deposed:– “Paragraph 11– That I know as a fact that it was agreed upon between the parties that interest at 21 % per annum subject to review in line with the g prevailing bank rate would be charged from time by the plaintiff on any outstanding monies due it from the defendant.” Plaintiff deposed at paragraph 17 of its said affidavit of the present bank levy rates of 31% per annum which brought the h debt claimed to the sum of N17,835,802.67. In exhibit “STB1” exhibited to the said affidavit plaintiff under the clause of interest rate stated that:– i “The Bank’s PLR is determined by ruling money marked conditions and therefore liable to charge without notice. There is no evidence that there was further agreement on the prevailing interest rates chargeable from time to time since 14/8/98 when the facility was granted and the said exhibits (sic) STB1 was j signed. The court holds that it is quite outrages (sic) and unlawful

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 286 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

for the plaintiff to charge 31% interest on the facility granted the a first defendant. As the evidence show (sic), plaintiff fails to show the various prevailing rates of interest charged since 14/8/98. The two rates of b interest shown are 21% and 31% but the various periods they were employed to calculate the indebtedness of the defendants are not shown. It is not the business of the court to do the calculation; it is squarely the business of plaintiff to do so. Plaintiff has woefully failed to discharge this onus . . . c The case is hereby dismissed.” Being dissatisfied with the said judgment, the plaintiff/ appellant has appealed to this Court via a notice of appeal dated 9 December, 2003 which has incorporated into it eight d grounds. Thereafter the parties filed and exchanged briefs of argument; the appellant’s brief was filed on 7 August, 2004 while the respondents’ brief was deemed to have been properly filed on 31 January, 2006. When this appeal came e before us for argument on 2 May, 2006, Mr Etuwewe, learned Counsel for the appellant referred to, adopted and relied in his client’s brief, by way of amplification, the learned Counsel submitted that account of law must always f confine itself to the case presented to it and relying on the decisions in Poly v Maina (2005) All FWLR (Part 284) 250 at 268 and UBN Ltd v Salami (1998) 3 NWLR (Part 543) 538, he urged us to allow the appeal. For his part, Mr Ejeh, g learned Counsel for the respondent also referred to, adopted and relied on his client’s brief of argument and urged us to dismiss the appeal. The appellant distilled only two issues for determination by this Court and as set out in its brief, h they are as follows:– “1. Whether the learned trial Judge was right in discountenancing and attaching no weight to the evidence of PW1 together with the Exhibit thereon. i 2. Whether the learned trial Judge was right in dismissing the plaintiff’s claim on the ground that the plaintiff is unable to prove interest on the principal sum of N10,000,000.00 which the court found was utilized by the defendants on the basis of Bankers/Customer Relationship or at all.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Standard Trust Bank Limited v Interdrill Nigeria Limited 287 a For their part, the respondents identified three issues for determination and as set out in their brief, they are in the following terms:– b “1. Whether the trial Judge was right in attaching no weight to the evidence of PW1 together with the exhibits thereon. 2. Whether the appellant proved the indebtedness of N17,835,802.67 (Seventeen Million, Eight Hundred and c Thirty-Five Thousand, Eight Hundred and Two Naira, Sixty- Seven Kobo) on the preponderance of evidence. 3. Whether the learned trial Judge was right when he held that the plaintiff has failed to prove interest.” d After a careful examination of the issues raised by both parties, I am of the clear view that issue No. 1 on the appellant’s brief is similar to Issue No. 1 on the respondent’s brief. I shall take both together – Issue No. 2 on the e appellant’s brief can be taken together with Issues Nos. 2 and 3 in the respondent’s brief which issues are interwoven. I shall thereafter take them together. Arguing issue No. 1 in its brief of argument, the appellant f submitted that it was a wrong application of the law for the learned trial Judge to hold that PW1 – Kelechi Okechukwu Ogbuna, a business officer of the appellant would not be believed for the mere season (sic) that he was not in the g employment of the appellant at the time of the transaction. It was its submission that the mere fact that PW1 was not in the employment of the appellant at the material time relevant to the transaction which forms the basis of this case, would not in law, on its own, be sufficient to justify the court h rejecting his evidence in toto, reliance was placed on the decisions in (1) Comet Ship Agencies Ltd v Babbit Ltd (2001) FWLR (Part 40) 1630; and (2) Kate Enterprises Ltd v Daewoo (Nig) Ltd (1985) 2 NWLR (Part 5) 127. For their i part the respondents argued that before any employee of a company can give evidence of any transaction in which the company is involved it must be shown that employee must be well-placed to have personal knowledge of such j transaction; support for this submission was placed on the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 288 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) two cases of Comet Shipping Agencies Ltd and Kate a Enterprises Ltd referred to by the appellant; PW1’s, it was further argued, evidence about what one Eluma Ifeanyi deposed to in support of the affidavit amounted to hearsay b evidence, which as was contended is inadmissible in law, support being found in the case of Flash Fixed Odds Ltd v Akatugba (2001) FWLR (Part 76) 709; and as PW1 did not depose to the supporting affidavit his evidence in proof of c the depositions has no legal value, it was again argued while the cases of Agwuegbo v Kagoma (2000) FWLR (Part 19) 511 and The Chairman, NPC v The Chairman Ikere Local Govt and others (2001) FWLR (Part 70) 1466 were relied upon for support. It was finally submitted that even though d the respondents were not given the opportunity to controvert the evidence of PW1, the learned trial Judge was right in not countenancing or attaching any weight to the evidence of that witness. e Let me start the consideration of this issue by saying that the qualitative and not the quantitative character of the evidence led in the court is what the law stresses. In the trial f of cases, the question often asked is who can be called as witnesses? The answer to that question is in the provision of section 155(1) of the Evidence Act, which reads:– “All persons shall be competent to testify, unless the court considers that they are prevented from understanding the question g put to them, or from giving rational answers to those questions, by reason of tender years, extreme old age, disease, whether of body or mind, or any other cause of the same kind.” It has been held that all persons here include those who are h even interested in the matter. In Yusuf v NTC Ltd (1977) 6 SC 39, the Supreme Court held at page 41 thus:– “It was wrong for the learned trial judge to reject the evidence of the two witnesses called by the defendant merely because they i were officials of the defendant and therefore interested parties.” I agree with the submission of the respondents that cases can be tried upon affidavit, however, the facts or deposition in such an affidavit have to be proved like averments in j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Standard Trust Bank Limited v Interdrill Nigeria Limited 289 a pleadings. See the decision in Boothia Maritime Inc v Fareast Mercantile Co Ltd (2001) FWLR (Part 50) 1713. In the instant case the appellant who was the respondent b in the court below filed an affidavit of 24 paragraphs and sworn to by one Eluma Ifeanyi, a credit officer of the appellant and reply to further and better affidavit which contains 9 paragraphs and sworn to by one Ben Obieze, a c Counsel in the Chambers of Counsel to the appellant. In opposition thereto, the respondents who were the defendants swore to an 18-paragraph affidavit and a six-paragraph further and better affidavit disclosing a defence. d The main thrust of the counter-affidavit is that both parties went into partnership that was what was put up as a defence on the merit. I pause to say that in a trial by affidavit once a counter-affidavit has been filed the court must e consider whether or not the deponent or his Counsel is present in court, the counter-affidavit is the party’s evidence before the court in respect of the matter for which it was filed. See: (1) Gever v China (1993) 9 NWLR (Part 315) 97 f and (2) A-G Enugu State v Omaba (1998) 1 NWLR (Part 532) 83. With regards to the printed evidence on both sides even though the respondents did not call oral evidence to substantiate the depositions in their counter-affidavit, the g trial Judge found as follows:– “The court prefers the evidence of plaintiff that the nature of the transaction was the grant of facility of N20,000,000.00 by the plaintiff to the first defendant by the implied admission of the defendant, first defendant utilized N10,000,000.00 . . . h The court finds as a fact that there was a banker and Customer relationship and the facility was granted in the cause (sic) of the relationship . . . The court rejects the defence of the relationship of partnership set i up by the defendants, it is a frivolous attempt to defeat the transaction duly entered unto by the plaintiff and the defendants.” The consideration of the counter-affidavit by the court below, even though no evidence was called, is in line with j the principles in Gever’s case (supra). Having so found as

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 290 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

I have shown supra, the substratum of the defence was a knocked out; all that was left was the printed evidence of the appellants, which was supported by oral testimony of PW1. It is now very axiomatic that proof of issues in a civil case is b on a balance of probabilities. Where there is nothing to put on the one side of the imaginary scale of justice, minimum evidence on the other side satisfies the requirement of proof even where strict proof such as proof of special damages is c the matter. See: (1) Mogaji v Odofin (1978) 4 SC 91; (2) Odulaja v Haddad (1973) 11 SC 357 and (3) Buraimoh v Bamgbose (1989) 3 NWLR (Part 109) 352. The only reason why the court refused to accord any evidential value to the testimony of PW1 is as the trial Judge said at page 88:– d “The court will however attach no weight to the evidence of PW1 in view of his evidence under cross-examination that he was not employed when the transaction was made nor did he depose to the said accompanying affidavit. e The evidence of PW1 merely repeats some paragraphs of accompanying affidavit.” The plaintiff/appellant, a limited liability company, is an f abstract body that only exists in the eyes of the law. In many ways it has always being likened to a human body. The law ascribes to a limited liability company the possession of a brain and a nerve centre, which controls what, it does. Since g it cannot form an intention within its abstract body, to operate, it must act through its agents, its employees or servants, who are often regarded as the hands to do the work of the company these are not in law, regarded as h representing the mind or the will of the company. Another category of employees of the legal fiction is the managers and directors. The law ascribes the right to control the will and mind of the company to this category of higher employees; the state of their minds is treated by the law as i that of the limited liability company, a mere legal fiction. See: (1) Ramanchadam v Ekpenyong (1975) 5 SC 29 and (2) Trenco Ltd v African Real Estate Ltd (1978) 4 SC 9. PW1 – Kelechi Okechukwu Ogbonna – in his evidence described j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Standard Trust Bank Limited v Interdrill Nigeria Limited 291 a himself as business officer of the plaintiff/appellant whose duties included managing the relationship between the customer and the bank, ie the plaintiff/appellant. He b therefore qualifies to be described as one of the directing minds and will of the plaintiff/appellant. It is true that he was not in the employment of the plaintiff/appellant at the time the transaction was concluded. Would this be an inhibition to ascribing probative value to the evidence of c PW1 or to making him a competent and compellable witness? I think not. In the case of Kate Enterprises Ltd v Daewoo (Nig) Ltd (1985) 2 NWLR (Part 5) 127 which is also in (1985) 7 SC 1, the Supreme Court per Uwais, JSC d (as he then was) held thus:– “To insist that the very person in the appellant company who negotiated the transaction with the respondent must be called as witness when the documents relating to the transaction are e available and have been admitted in evidence without objection and PW1 is in a position to know about the transaction by the office he holds is, in my view, a negation of the very essence of the corporate personality of the appellants.” In the recent case of Saleh v Bank of the North Ltd (2006) 6 f NWLR (Part 976) 316, the Supreme Court per the judgment of Musdapher, JSC at pages 326–327 lucidly stated the principle thus:– “I entirely agree with the opinion of the court below, that the mere g fact that a bank staff was not around when a customer’s bank account was opened was not enough to prevent the staff from testifying or giving evidence on customer’s account . . . It is settled law, that a company such as the respondent bank h herein is a juristic person and can only act through its agents or servants. Any agent or servant can consequently give evidence to establish any transaction entered into by a juristic personality. Even, where the official giving the evidence is not the one who actually took part in the transaction on behalf of the company. i Such evidence nonetheless is admissible, will not be discountenanced or rejected as hearsay evidence. The learned trial Judge was clearly in error to have ignored the evidence led by the respondent’s witnesses on the ground merely that they were not around when the appellant opened its account with the respondent j bank.”

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 292 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

I have said that the appellant is a mere legal abstraction and a that PW1 by virtue of his position, must have knowledge of any particular transaction entered into by his employers – the legal fiction. In the case of Comet SA (Nig) Ltd v Babbit b (Nig) Ltd (2001) 7 NWLR (Part 712) 442, this Court (the Lagos Division) held that its manager was competent to testify about the company’s affairs. Following the above authorities, more in particular the case of Daewoo which is binding on this Court, I hold that the learned trial Judge c erred in holding that the evidence of PW1 was lacking in evidential value for the reason stated. Since that evidence was not challenged and there is no legal inhibition militating against it, I hold that that testimony is of high evidential d value. It is even erroneous for the trial judge to later hold otherwise having earlier held that he preferred the evidence of plaintiff that the nature of the transaction was the grant of facility of N20,000,000 to the plaintiff by the first defendant. e Issue No. 1 in the appellant’s brief is consequently answered in the negative; the learned trial judge was not right in so holding, and I also answer Issue No. 1 in the respondents’ brief in the negative. f On Issue No. 2 in the brief of the appellant and Issues Nos. 2 and 3 without of the respondents (sic), having found that the defence of partnership put forward by the respondent failed and having held that the relationship g between them is that of the banker/customer, the learned trial Judge should have proceeded to properly evaluate the evidence led on the issue of interest. The word “INTEREST” as applicable to the relationship of banker/ h customer is a sum of money payable in respect of the use of the banker’s money by the customer which money is often termed PRINCIPAL. I hasten to add that failure to sufficiently plead that the plaintiff is entitled to an interest i rate agreed by both parties will result in failure to get judgment on that interest so claimed. See: (1) NDIC v Ecobank (Nig) Ltd (2003) 11 NWLR (Part 830) 93 and (2) Bendel Feed and Flour Mill Ltd v NPMB Ltd (2000) 5 NWLR (Part 655) 29. Exhibits “STB1” and “STB2” copies j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA Standard Trust Bank Limited v Interdrill Nigeria Limited 293 a of which were attached to the supporting affidavit clearly authenticate the interest rate payable. The first respondent signed the Memorandum of Acceptance Column by a b affixing its common seal and one of its directors by name Joseph Bogwu who, incidentally, is the second respondent signing it and the secretary of the Company by name Johnson Uwabor also signing. c Again, the second respondent also signed the Guarantee and Indemnity Form – exhibit “STB2” which itself accompanied the supporting affidavit. There was no scintilla of evidence denying the signatures of the respondents. In the d absence of plea of non est factum or allegation of signing under duress the mere fact of the signature of a person on a document makes the contents binding in him. I do realise that this is a Court of Appeal and we must be wary in e upturning the findings of the trial Judge. However, where it is clear that the trial Judge had not taken the advantage of seeing and hearing the witnesses and by that reason he has reached a wrong conclusion in the evaluation of the evidence of such witness or witnesses, the Appellate Court f can interfere by reversing the findings. The summation of the trial Judge, from what I have said supra is wrong in law. A proper evaluation of the totality of the evidence led would have led him to come to the right conclusion by entering g judgment in favour of the appellant. It is for the above that I hereby hold that Issue No. 2 on the appellant’s brief must be resolved in its favour and I so resolve. Issues Nos. 2 and 3 on the respondents’ brief are resolved against the h respondent. Having so held, the conclusion that I reach now is that this appeal is meritorious. It is hereby allowed. The judgment of the court below dismissing the plaintiff/ i appellant’s case in toto is hereby set aside. In its place, I hereby enter judgment in favour of the plaintiff/appellant but against the defendants/respondents in the following terms:– “(1) The defendants/respondents shall pay the sum of j N17,835,802.67k (Seventeen Million, Eight Hundred and

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Aderemi JCA 294 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Thirty-Five Thousand, Eight Hundred and Two Naira, Sixty- a Seven kobo) being the outstanding debt balance in the first defendant’s account with the plaintiff as at 2 February, 2001 which sum is due the plaintiff from an overdraft facility granted to the first defendant at the first defendant’s request b and guaranteed by the second defendant which sum the defendants have failed, neglected, omitted and/or refused to pay inspite of repeated demand. (2) 31% per annum on the said sum of N17,835,802.67k c (Seventeen Million, Eight Hundred and Thirty-Five Thousand, Eight Hundred and Two Naira, Sixty-Seven Kobo) from 3 February, 2001 until judgment and thereafter 5% (five per cent) per annum on the judgment sum until same is fully liquidated.” d The appellant is entitled to the cost of this appeal, which I assess and adjudge in its favour but against the respondents at N5,000 costs in the court below and N7,500 as costs in e this appeal. ABBA-AJI JCA: I have had the privilege of the preview of the judgment of my learned brother Aderemi, JCA just delivered. I am entirely in agreement with his analysis of the f legal position as well as his conclusion. It is the duty of an Appellate Court not to interfere with findings of fact made by a trial court which had the advantage of hearing and seeing witnesses testify so long as those findings are g reasonably supported by evidence, except in special circumstance such as commission of error in substantive or procedural law or where the findings are shown to be perverse. In the instant case, the learned trial Judge h misdirected himself and thereby came to the wrong conclusion in law when he discountenanced the evidence of PW1 Mr Kelechi Ogbonna, the business officer of the appellant bank together with the exhibits tendered thereon on the ground that PW1 was not employed when the i transaction, the subject matter of the appeal was made and that he did not depose to the accompanying affidavit. The position of the law is that the evidence acquired by a witness in the course of his employment is not only relevant but also j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Standard Trust Bank Limited v Interdrill Nigeria Limited 295 a admissible. Comet Shipping Agencies Ltd v Babbit Ltd (2001) FWLR (Part 40) 1630. Any employee of a company that is well placed to have personal knowledge of any b transaction in which the company is engaged can give evidence of such transaction. Companies are corporate entities. Their existence is a mere legal abstraction. They have no flesh and blood. They therefore of necessity act c through their directors, managers and other officials. Therefore, any manager or official of the company well placed to have personal knowledge of any particular transaction in which the company is engaged can give evidence of such transaction. PW1 was clearly in a position d to know enough about the transaction and to testify to it on behalf of the appellant. Besides, his evidence was substantially unchallenged and supported by the documents tendered. I am satisfied that if the trial Judge had borne these e facts in mind, he would have given due weight to the oral and documentary evidence tendered by the appellant before him, and he would not have come to the wrong conclusion, as he did in the instant case. See also Kate Enterprises Ltd v f Daewoo (Nig) Ltd (1985) 2 NWLR (Part 5) 127. It is for this reason and the detailed reasons in the lead judgment that I also allow this appeal. I abide by the consequential orders made in the judgment including order g as to costs.

SHOREMI JCA: I have had the advantage of reading in draft the judgment delivered by my learned brother Aderemi, h JCA. I agree with the reasoning and conclusion therein. I also hold that this appeal is meritorious. While it is part of the duties of a bank to grant credit/overdraft facilities to its customers, the customer is i also duty bound to pay interest on borrowed/overdraft funds as agreed. The terms of contract between a bank and customer involve obligation on both sides which includes the promise to repay loans and overdraft facilities granted to j the customer.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, BENIN DIVISION) Shoremi JCA 296 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

I hereby allow the appeal. The judgment of the court a below dismissing the plaintiff/appellant’s case is also in toto hereby set aside and judgment entered in favour of the plaintiff/appellant in the terms contained in the leading b judgment and the consequential order as to cost. Allowing the appeal.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

UBN Plc v Ifeoluwa Nigeria Enterprises 297 a UBN Plc v Ifeoluwa Nigeria Enterprises b COURT OF APPEAL, LAGOS DIVISION SALAMI, AGBO, GALINJE JJCA

Date of Judgment: 13 JULY, 2006 Suit No.: CA/L/415/2004 c Banking – Banker/customer relationship – Nature of Banking – Interest – Award of – Attitude of court Banking – Interest – Central Bank guidelines – Whether d court to take judicial notice of – Attitude of court

Facts On 26 February, 1996, the respondent sent one of its e employees to the Isolo, Lagos branch of the first appellant to pay in some money into its account with the appellant. Some armed bandits broke into the bank and snatched some of the money already handed over to the second appellant, a f servant of the appellant. On the refusal of the first appellant to credit the account of the respondent with the amount equivalent to the said snatched sum, the respondent proceeded at the Lagos State High Court against the g appellants in Suit No. ID/1593/96 praying the court as follows:– “1 The plaintiffs claim against the defendant is in the sum of (N925,000.00) Nine Hundred and Twenty- Five Thousand h Naira) only being the amount of money within the defendants premises owing to the negligence of the defendants on Monday the 25th day of February, 1996 at about 11.00 hour at the Isolo branch of the defendant bank. i 2. Plaintiff further claims interest at the rate of 21% per annum or as this Honorable Court may determine having regard to the prevailing Central Bank of Nigeria regulation thereof from the 26th day of February, 1996 until the whole sum j claimed be paid.”

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

298 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Pleading were exchanged, evidence led and in a considered a judgment, the court adjudged as follows:– “After considering of all these, I prefer and believe the evidence of the PWI that the amount on exhibit A is what he took to the b defendant’s bank on 26/2/96 out of which the sum of N735,000.03 was taken by armed robbers leaving the sum of N190, 000.00 which was later credited to the account of the plaintiff’s company in No.721857573 and I hold that the defendant bank is liable to pay the sum of N735, 000.00 to the account of the plaintiff. c The defendant is further ordered to pay 21% interest per annum on the said amount from 26/2/96 until when the amount is credited.” Being dissatisfied only with the interest adjudged, the d appellants have filed this appeal.

Held – 1. The relationship between the first appellant and the e respondent is that of a banker and its customer. The relationship between a banker and its customer is that of an agent and principal as well as that of a debtor and its creditor. When a customer deposits an amount of money f in its current account with the bank, the bank becomes a debtor to the customer in that sum. 2. A bank is not a charitable organisation. It is a trading company, and the commodity it trades on is money. g When therefore a bank advances credit or a loan to its customer, the court takes judicial notice of the fact that it is entitled to interest. This mutatis mutandi applies when the bank takes credit by way of deposit from its h customers. It is the interest accruing to either the bank or its customer that the Central Bank of Nigeria by the provision of section 15 of the Central Bank Act attempts to control. i 3. There are two circumstances in which the courts award interest. There are (a) as of right – this arises where it is contemplated by the parties by agreement express or implied or j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

UBN Plc v Ifeoluwa Nigeria Enterprises 299 a under mercantile custom or under a principle as a breach of a fiduciary relationship and (b) where the power is conferred by the statute. Where b interest is claimed as of right, it ought ordinarily, like any other primary prayer, to be set out on the writ of summons. Where however it is not set out on the writ but pleaded c in the statement of claim, the plea would be competent as the statement of claim supersedes the writ. The facts so pleaded must disclose the entitlement to the interest, the rate of interest and the date of accrual. d 4. The claimant shall thereafter lead evidence to establish the pleaded facts. Once these facts are proved, the court shall award the interest so claimed. In the instant case the respondent had established its entitlement to interest e and the accrual date. It however had difficulties in establishing the rate of interests. 5. The Central Bank of Nigeria from time to time prepares f a list of charges, guidelines and policy pursuant to powers vested on it by section 15 of the Banking Act. These policy documents are commonly referred to in the banking community as Central Bank Guidelines. They g are not subsidiary legislations and do not fall into the class of documents the courts must take judicial notice of. Any Central Bank guideline relied upon, must therefore be proved in evidence by producing same in court. h Appeal allowed.

Cases referred to in the judgment i Nigerian Badaru v SCB (Nig) Ltd (2003) 10 NWLR (Part 827) 91 Ekwunife v Wayne West Africa Ltd (1989) 5 NWLR (Part j 122) 422

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION)

300 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Habib Nig Bank Ltd v Gift Unique (Nig) Ltd (2004) 15 a NWLR (Part 896) 408 Oputeh v Ishida (1993) 3 NWLR (Part 279) 34 Texaco Overseas (Nig) Ltd v Pedmar (Nig) Ltd (2002) 13 b NWLR (Part 785) 526 Udechukwu v Okwuka (1956) SCNLR 189 Yesufu v ACB (1991) 1 SC 74 c Nigerian statutes referred to in the judgment Banking Act, section 15 High Court of Lagos State (Civil Procedure) Law Cap 61 d Laws of Lagos State, 1994 Law (Miscellaneous Provisions) Law of Lagos State, section 2 e Foreign statute referred to in the judgment Judgments Act, 1838 (UK)

Nigerian rules of court referred to in the judgment f High Court of Lagos State (Civil Procedure) Rules, 1994 Order 36 rule 7 and Order 38 rule 7

Counsel g For the appellant: Aduroja (with him Peter Omijie) For the respondent: Ekisola

Judgment h AGBO JCA: (Delivering the lead judgment) The respondent is a customer of the first appellant. On 26 February, 1996, the respondent sent one of its employees to the Isolo, Lagos Branch of the first appellant to pay in some money into its i account with the appellant. Some armed bandits broke into the bank and snatched some of the money already handed over to the second appellant, a servant of the first appellant. On the refusal of the first appellant to credit the account of j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA UBN Plc v Ifeoluwa Nigeria Enterprises 301 a the respondent with the amount equivalent to the said snatched sum, the respondent proceeded at the Lagos State High Court against the appellants in Suit No. ID/1593/96 b praying the court as follows:– “1. The plaintiff’s claim against the defendants is in the sum of N925,000.00 (Nine Hundred and Twenty Thousand Naira) only being the amount of money within the c defendants premises owing to the negligence of the defendants on Monday the 25th day of February, 1996 at about 11.00 hours at the Isolo Branch of the defendant bank. 2. Plaintiff further claims interest at the rate of 21% per annum d or as this Honourable Court may determine having regard to the prevailing Central Bank of Nigeria regulations thereon from the 26th day of February, 1996 until the whole sum claimed be paid.” e Pleadings were exchanged, evidence led, and in a considered judgment, the court below adjudged as follows:– “After considering of all these, I prefer and believe the evidence of the PW1 that the amount on exhibit ‘A’ is what he took to the f defendant’s bank on 26/2/96 out of which the sum of N755,000.00 was taken by armed robbers leaving the sum of N190,000.00 which was later credited to the account of the plaintiff’s company in No. 721857573 and I hold that the defendant bank is g liable to pay the sum of N735,000.00 to the account of the plaintiff. The defendant is further ordered to pay 21% interest per annum on the said amount from 26/2/96 until when the amount is credited.” h Being dissatisfied only with the interest adjudged, the appellants have filed this appeal. The grounds of appeal are set out hereunder:– Grounds of Appeal i 1. The learned trial Judge erred in law in awarding interest to the plaintiff when there was no evidence conversed at the trial in support of this leg of the j plaintiff’s claim.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA 302 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Particulars of Error a The learned trial Judge failed and/or omitted to apply the fundamental principle of law that he who asserts must prove that those facts exist. b (i) The plaintiff claimed interest but refused to establish this claim by way of admissible oral or documentary evidence. c 2. The learned trial Judge erred in law in awarding the plaintiff interest at the rate of 21% on the judgment debt. Particulars of Error d (i) The plaintiff in its statement of claim, claimed interest having regard to the prevailing Central Bank of Nigeria regulations. e (ii) The plaintiff gave no iota of evidence on the interest prevailing based on the Central Bank of Nigeria regulation and tendered no document to establish what the rate was. f 3. The learned trial Judge erred in law when he awarded interest to the plaintiff on an amount meant for the plaintiff’s current account. There was no evidence that the plaintiff had been receiving interest on its g interest account with the first defendant in the past and no relevant fact was pleaded by the plaintiff. Particulars of Error h (i) The claim of the plaintiff from the pleadings did not state if the claim for interest was under a contract, under mercantile usage or under equity. i (ii) The plaintiff through its witness tendered exhibits “A” and “Al” at page 61 of the record as evidence of the amount and the nature of the account, that is, a current account. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA UBN Plc v Ifeoluwa Nigeria Enterprises 303 a (iii) The learned trial Judge without any oral or documentary evidence awarded interest on the sum meant for a current account contrary to the b banking practice and which claim was not supported by the pleadings. 4. The learned trial Judge erred in law in awarding interest in favour of the plaintiff at the rate of 21% per c annum. Particulars of Error (i) The plaintiff’s claim for interest as at the rate of 21% per annum based on prevailing Central d Bank of Nigeria regulations at pages 2 and 53 of the records. (ii) Evidence of the plaintiff witness at page 62 of e the records did not state what the Central Bank Regulation on interest was in 1996. (iii) There was no evidence of the approved interest rate structure under section 15(1) and (2) of the f Banking Act Cap 28 Laws of the Federation of Nigeria, 1990. (iv) The learned trial Judge acted beyond his statutory powers under Order 38 Rule 7 of the g High Court of Lagos State (Civil Procedure) Rules, 1994. From these grounds of appeal, the appellants have distilled the following issues for determination:– h Issues arising for determination (i) Whether on the pleadings and evidence before the court, the respondent discharged the onus of i proof on its claim for interest at 21% per annum. (ii) Whether on the pleadings and evidence the respondent proved its claim for interest under j the enabling laws.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA 304 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(iii) Whether on the evidence called at the trial the a respondent was able to establish the proper rate of interest and the date from which it should begin to run whether from the accrual of the b cause of action or otherwise and whether current account attracts interest or otherwise. The respondent on the other hand formulated only one issue for determination to wit– c Issue arising for determination Whether having regard to the circumstances of the case, and the position of the law on interest rate at the material time, d including the fluctuating nature of the Nigerian currency, the honourabe Court exercised its undoubted discretion judiciously and judicially? It is clear that the appellant’s issues for determination e more comprehensively dealt with the issues raised by the grounds of appeal. This appeal will therefore be determined based on the issues distilled by the appellants. In arguing the appeal, the appellant’s Counsel had argued f that it is incumbent on a party claiming interest to specifically set out this claim either in contract, statute or mercantile custom and facts grounding such claim. The party is to thereafter lead evidence to establish the facts so g pleaded. He argued that the respondent found its prayer for interest on “the prevailing Central Bank of Nigeria Regulations”. He argued that Central Bank Regulations are founded on section 15 of the Banking Act. The section is h reproduced below:– “15(1) The rate of interest charged on advances, loans or credit facilities or paid on deposits by any licensed bank shall be linked to the minimum rediscount rate of the Central i Bank subject to the stated minimum and maximum rates of interest when so approved shall be the same for all licensed banks, provided that differential rates may be approved for the various categories of banks to which this Act applies. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA UBN Plc v Ifeoluwa Nigeria Enterprises 305 a 15(2) The interest rate structure of each licensed bank shall be subject to the approval of the Central Bank.” Pursuant to the provisions of the above section the b respondent ought to have led evidence to establish:– (a) the rate of interest allowed by the Central Bank (b) The minimum discount rate of the Central Bank and c (c) the differential rate if any, approved for the respondent. He argued that the respondent neither pleaded nor proved any contract nor custom entitling it to the interest claimed. d Counsel admits that Order 38 rule 7 of the High Court of Lagos State (Civil Procedure) Rules, 1994 provides for statutory interest on judgment debt. Order 38 Rule 7 is reproduced hereunder:– e Order 38 Rule 7 “The court at the time of making any judgment or order, or at any time afterwards, may direct the time within which the payment or other act is to be made or done, reckoned from the date of judgment order, or from some other point in time, as the court f thinks fit, and may order interest at a rate not exceeding seven and a half per centum per annum to be paid upon any judgment, commencing from the date thereof or afterwards.” He denies that the said Order 38 rule 7 is applicable but that g even if it was, there was:– (1) no jurisdiction on the court to award more than 10% and h (2) its date of accrual could not have been earlier than the date of judgment. Counsel concluded that the respondent did not make out a claim for interest in its pleadings nor did it place before the i Court enough evidence to justify the interest awarded. The respondent Counsel in his argument conceded that the respondent led no evidence on the applicable rate of interest as there was no prior contract in that regard between j the parties. He however posited that the interest awarded

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA 306 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) was interest on “judgment debt” awarded pursuant to the a provisions of the Judgments Act, 1838 (UK), an Act which he claims is a statute of general application applicable in Lagos State pursuant to section 2 of the Law (Miscellaneous b Provisions) Law of Lagos State. He argued that the restrictive provisions of Order 38 rule 7 of the High Court of Lagos State (Civil Procedure) Rules, 1994 to the extent of its inconsistency with the provisions of the Judgment Act, 1838 c is ultra vires the said Act and therefore inapplicable. He argued that this Court lacked the competence to challenge the absolute discretion of a trial court in awarding interest on a judgment which interest is within the upper limit allowed d by statute. He however accepts that the accrual date for such interest is the date of judgment. To appreciate what is at issue here, it must be remembered that the relationship between the first appellant e and the respondent is that of a banker and its customer. The relationship between a banker and its customer is that of an agent and principal as well as that of a debtor and its creditor. When a customer deposits an amount of money in f its current account with the bank, the bank becomes a debtor to the customer in that sum. See Badaru v SCB (Nig) Ltd (2003) 10 NWLR (Part 827) 91 at 101; Yesufu v ACB Ltd (1981) 1 SC 74. A bank is not a charitable organisation. It is g a trading company and the commodity it trades on is money. When therefore a bank advances credit or a loan to its customer, the court takes judicial notice of the fact that it is entitled to interest. This mutatis mutandis applies when the bank takes credit by way of deposit from its customers. It is h this interest accruing to either the bank or its customer that the Central Bank of Nigeria by the provision of section 15 of the Central Bank Act attempts to control. The respondent on 26 February, 1996 deposited an amount of money equivalent i to the judgment sum with the first appellant. It ought to have been entered in the respondent’s account with the first appellant on that date, and from that date, interest ought to have accrued on that sum in favour of the respondent. But j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA UBN Plc v Ifeoluwa Nigeria Enterprises 307 a the first appellant neither entered the sum in respondents account not did it pay interest. If therefore the respondent pleads and proves the interest rate, it would be entitled to the b interest claimed. There are two circumstances in which the courts award interest. There are:– (a) as of right this arises where it is contemplated by the c parties by agreement express or implied or under mercantile custom or under a principle of equity as a breach of a fiduciary relationship – see Texaco Overseas (Nig) Ltd v Pedmar (Nig) Ltd (2002) 13 d NWLR (Part 785) 526, and (b) where the power is conferred by statute. Where interest is claimed as of right, it ought ordinarily, like any other primary prayer, be set out on the writ of summons. e Where however it is not set out on the writ but pleaded in the statement of claim, the plea would be competent as the statement of claim supersedes the writ. The facts so pleaded must disclose the entitlement to the interest, the rate of f interest and the date of accrual see Texaco Overseas (Nig) Ltd v Pedmar (supra); Ekwunife v Wayne West Africa Ltd (1989) 5 NWLR (Part 122) 422; Udechukwu v Okwuka (1956) SCNLR 189. The claimant shall thereafter lead g evidence to establish the pleaded facts. Once these facts are proved, the court shall award the interest so claimed. In the instant case the respondent had established its entitlement to interest and the accrual date. It however had difficulties in h establishing the rate of interest. It pleaded as the rate of interest 21% or such interest as may determined by Central Bank guidelines from time to time. In evidence PW1 testified that 21% was the going rate i as at 1996. The particular rate for the first appellant was neither pleaded nor proved. The Central Bank Guidelines was not placed before the court. The Central Bank of Nigeria from time to time prepares a j list of charges, guidelines and policy pursuant to powers

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA 308 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) vested on it by section 15 of the Banking Act. These policy a documents are commonly referred to in the banking community as Central Bank Guidelines. They are not subsidiary legislations and do not fall into the class of b documents the court must take judicial notice of. Any Central Bank Guidelines relied upon, must therefore be proved in evidence by producing same in court – see Habib Nigeria Bank Ltd v Gifts Unique (Nig) Ltd (2004) 15 NWLR c (Part 896) 408 at 428. This unfortunately the respondent did not do in this case. I therefore hold that in the instant case, the interest rate pleaded was not proved. The respondent’s Counsel had argued that the interest d claimed and awarded was a post judgment interest and that Order 36 rule 7 of the High Court of Lagos State (Civil Procedure) Rules, 1994 was the ultra vires the provisions of the Judgment Act, 1838 (UK) to the extent that it tries to e limit interest payable on judgment sum to seven and half per centum per annum. In the first place, the respondent never asked for interest on the judgment sum. It merely claimed for interest at the rate of 21% from 26 February, 1996 until f the whole sum claim be paid. Interest on judgment sums are not claimed of 21% from 26 February, 1996 until the whole sum claimed be paid. Interests on judgment sums are not claimed from the accrual of the cause of action but from the g date of judgment. The interest claimed was certainly not interest on the judgment sum. Therefore, neither Order 38 rule 7 of the High Court of Lagos State (Civil Procedure) Rules, 1994 nor the Judgment Act, 1838 (UK) is applicable in the instant case. I must further state that the provisions of h the Judgment Act, 1838 (UK) are inapplicable in Lagos State, whether or not it qualifies as a statute of general application. This is because a careful look at the High Court of Lagos State (Civil Procedure) Rules, 1994 will show that i that piece of legislation is not a subsidiary legislation. It is rather a schedule to the High Court of Lagos State (Civil Procedure) Law Cap 61 Laws of Lagos State, 1994. A Schedule to an Act or Law is very much part of that Act or j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, LAGOS DIVISION) Agbo JCA UBN Plc v Ifeoluwa Nigeria Enterprises 309 a Law – see Oputeh v Ishida (1993) 3 NWLR (Part 279) 34. The High Court of Lagos State (Civil Procedure) Rules Law supersedes the Judgment Act, 1838 (UK). b There is merit in this appeal, it succeeds. The interest awarded by the court below is hereby set aside. The prayer for interest is hereby dismissed. There shall be N10,000 costs to the appellants. c SALAMI JCA: I read in draft the judgment just delivered by my learned brother Agbo, JCA with which I entirely agree. I agree with the reasoning contained therein and the conclusion arrived thereat. d I also endorse all the consequential orders including the order as to costs proposed in the lead judgment of my learned brother, Agbo, JCA. e GALINJE JCA: I agree entirely with the reasoning and conclusion contained in the judgment just delivered by my learned brother Agbo, JCA. My learned brother has exhaustively treated all the issues raised in this appeal. I f have nothing useful to add. I therefore endorse all the consequential orders contained in the lead judgment including the order as to costs made therein. Appeal allowed.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

310 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

a Eagle Super Pack (Nig) Ltd v ACB Plc

SUPREME COURT OF NIGERIA b KALGO, OGUNTADE, TOBI, MOHAMMED, TABAI JJSC Date of Judgment: 8 DECEMBER, 2006 Suit No.: SC. 86/1998

Banking – Uniform Customs and Practice for Documentary Credit – Applicability of in Nigeria – Principle governing c Banking – Uniform Customs and Practice for Documentary Credit – To be specifically incorporated into parties contract – Where not done – Effect d Facts The dispute out of which this appeal arose was between a bank and its customer. The appellant was the bank and the respondent the customer. At the Orlu High Court of Imo e State, the respondent as the plaintiff claimed against the appellant as the defendant the sum of two million Naira being special and general damages. The claim was in negligence and alternatively for breach of contract. The f parties are hereinafter referred to as “plaintiff” and “defendant” in line with their description before the trial court. The dispute arose in this way. The plaintiff wanted to pay g its overseas suppliers based in Japan the sum of US$16,180 for raw materials to be imported. It approached the defendant, its banker for the issuance of a letter of credit in favour of the Japanese suppliers. In the month of December, h 1986, the plaintiff through the defendant sourced from the second tier foreign exchange market the said sum of US$16,180,00 for which it paid N55,699.65. The plaintiff also paid the defendant the charges and commission i demanded to enable the defendant to effect the transfer of the money to the plaintiff’s overseas suppliers. It would appear that the defendant on 12/12/86 issued a letter of credit which was to remain valid till 13/1/87 in j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Eagle Super Pack (Nigeria) Limited v ACB Plc 311 a favour of the Japanese supplier. This was after the plaintiff had given to the defendant all the documents needed to enable the transfer to be effected. However, the letter of b credit for unascertained reasons did not get to the Japanese company. The plaintiff wrote a number of letters to the defendant complaining that the Japanese company had not received the letter of credit. The plaintiff’s solicitor also did c the same. The position remained the same. In these circumstances the plaintiff issued its writ of summons claiming as earlier stated. The defence of the defendant was that it had merely acted d as agent to the plaintiff for the purpose of getting the letter of credit transferred to the Japanese supplier, and that it did all that was required of it as such agent to carry out that duty. It denied being negligent. It pleaded that it was relying e on articles 18 and 19 of the Uniform Customs and Practice for Documentary Credit. The case was tried by Ononuju, J, at the Orlu High Court of Imo State. On 26/1/89, the trial Judge in his judgment, f awarded a total sum of one million, sixty-three thousand, five hundred and sixty-seven Naira, seventy-seven Kobo (N1,063,567.77) representing special and general damages in favour of the plaintiff. In coming to this conclusion, the g trial Judge took the view that the Uniform Customs Practice for Documentary Credit, (hereinafter referred to as UCP) upon which the defendant had relied, was inapplicable to the case. h The defendant was dissatisfied. It brought an appeal before the Court of Appeal, Port Harcourt Division (hereinafter referred to as the court below). The court below on 2/6/94 allowed the appeal. It held that UCP applied and i relied on some cases for the said conclusion. It ordered that the case be retried de novo. Finally, it ordered the defendant to pay to the plaintiff the sum of US$16,180. Both parties were dissatisfied with the judgment, and have come on a j final appeal before the Supreme Court.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

312 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Held – a 1. In order to make UCP applicable, the bankers/customer ought to have specifically incorporated its terms into their contracts. b 2. Clearly, the defendant in instant case is caught by the established principle in the law of contract that defendant relying on an exemption clause must show that the plaintiff had been made aware of the exemption c clause. 3. Per curiam “The conclusion is inescapable that the court below was too sweeping in its conclusion that the UCP applies to all d transactions relating to letters of credit between banker and customer irrespective of whether or not the parties had adverted their minds to it in the application for the issuance of a letter of credit. It seems to me that the parties themselves e may only incorporate any of the provisions of the UCP into their contract if they are so inclined. Indeed, Article I of UCP recognizes the optional nature of the applicability of the UCP when it says– ‘These articles apply to all documentary credits f including to the extent to which they may be applicable. Standby letters of credit are binding on all parties unless otherwise expressly agreed. They shall be incorporated into each documentary credit by wording in the credit g indicating that such credit is issued subject to Uniform Customs Practice for Documentary Credits’.” 4. Until a convention acquires the force of law by incorporation into the body of laws of this country or is h shown to be a custom or usage of trade which has been regularly recognized and upheld by the superior courts in Nigeria as to acquire general acceptance, a party in a civil suit wishing to rely on it must prove its existence, and the fact that the parties have agreed to their contract i to let such convention or custom govern their relationship. A party relying on the terms of an international convention or protocol must show proof that Nigeria has subscribed to such convention. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

Eagle Super Pack (Nigeria) Limited v ACB Plc 313 a Allowing the appeal and cross-appeal in part.

Cases referred to in the judgment b Nigerian A-G Bendel State v UBA (1986) 4 NWLR (Part 37) 547 Akinsanya v UBA Ltd (1986) 4 NWLR (Part 35) 273 c Fatoyinbo v Williams (1956) 1 FSC 67; (1956) 1 SCNLR 274 Nasaralai Ent Ltd v Arab Bank (1986) 4 NWLR (Part 36) 409 d Okpiri and others v Jonah and others (1961) 1 All NLR 102; (1961) 1 SCNLR 174 Omonuwa v Wahabi (1976) 4 SC 37 Shell BP Petroleum Development Company (Nig) Ltd v Cole e and others (1978) 3 SC 183 Foreign Hood v Anchor Line (Henderson Bros) Ltd (1918) AC 837 f Intraco Ltd v Notis Shipping Corporation of Liberia, The Bhoja Trader (1981) 2 Lloyds Rep. 256 Richardson, Spence and Co and another v Minnie Rowntree g (1894) AC 217 Services Europe Atlantique and (SEAS) v Stockholms Rederiaktiebolag SVEA. The Folias [1978] 2 All ER 764

Foreign statute referred to in the judgment h Uniform Customs and Practices for Documentary Credit

Books referred to in the judgment i Chitty on Contract (23ed) paragraph 732, page 329 Raymond Jack Documentary Credits 1993 (2ed), page 9 para. 1.22 Schmiutthoff Export Trade: The Law and Practice of j International Trade (8ed), Chapter 24 page 336

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

314 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Counsel a For the appellant: Onegbedan (with him Ikezahu) For the respondent/cross-appellant: Onyiuke (Ms) b Judgment OGUNTADE JSC: (Delivering the lead judgment) The dispute out of which this appeal arose was between a bank and its customer. The appellant was the bank and the c respondent the customer. At the Orlu High Court of Imo State, the respondent as the plaintiff claimed against the appellant as the defendant the sum of two million naira being special and general damages. The claim was in d negligence and alternatively for breach of contract. The parties are hereinafter referred to as “plaintiff” and “defendant” in line with their description before the trial court. e The dispute arose in this way. The plaintiff wanted to pay its overseas suppliers based in Japan the sum of US$16,180 for raw materials to be imported. It approached the defendant, its banker for the issuance of a letter of credit in f favour of the Japanese suppliers. In the month of December, 1986, the plaintiff through the defendant sourced from the second tier foreign exchange market the said sum of US$16,180 for which it paid g N55,699.65. The plaintiff also paid the defendant the charges and commission demanded to enable the defendant to effect the transfer of the money to the plaintiff’s overseas suppliers. h It would appear that the defendant on 12/12/86 issued a letter of credit which was to remain valid till 13/1/87 in favour of the Japanese supplier. This was after the plaintiff had given to the defendant all the documents needed to i enable the transfer to be effected. However, the letter of credit for unascertained reasons did not get to the Japanese company. The plaintiff wrote a number of letters to the defendant complaining that the Japanese company had not j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 315 a received the letter of credit. Plaintiff’s solicitors also did the same. The position remained the same. In these circumstances, the plaintiff issued its writ of summons b claiming as earlier stated. The defence of the defendant was that it has merely acted as agent to the plaintiff for the purpose of getting the letter of credit transferred to the Japanese supplier, and that it did c all that was required of it as such agent to carry out that duty. It denied being negligent. It pleaded that it was relying on articles 18 and 19 of the Uniform Customs and Practice for Documentary Credit. d The case was tried by Ononuju, J, at the Orlu High Court of Imo State. On 26/1/89, the trial Judge, in his judgment, awarded a total sum of one million, sixty-three thousand, five hundred and sixty-seven Naira, seventy-seven Kobo e (N1,063.567.77) representing special and general damages in favour of the plaintiff. In coming to this conclusion, the trial Judge took the view that the Uniform Customs Practice for Documentary Credit, (hereinafter referred to as UCP) f upon which the defendant had relied, was inapplicable to the case. The defendant was dissatisfied. It brought an appeal g before the Court of Appeal, Port Harcourt Division (hereinafter referred to as the court below). The court below on 2/6/94 allowed the appeal. It held that UCP applied and relied on some cases for the said conclusion. h It ordered that the case be retried de novo. Finally, it ordered the defendant to pay to the plaintiff the sum of US$16,180. Both parties were dissatisfied with the judgment, and have come on a final appeal before this i Court. The defendant in the trial court and appellant before the court below is the appellant before this Court although the brief filed on its behalf by the Chambers of CO Akpamgbo, j Esq., SAN erroneously described it as the respondent.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 316 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

In the appellant’s brief, the issues for determination were a identified as the following:– “(i) Was the Court of Appeal right after holding that the learned trial Judge erred in law by holding that exhibit ‘S’, the b Uniform Customs and Practice Documentary Credit (UCP) was inapplicable, allowed the appeal and remitted the case for trial de novo? (ii) Was the Court of Appeal right after holding that exhibit ‘S’ is applicable in Nigeria and in the instant case not to have c considered other issues for determination canvassed in the appeal? (iii) Was the Court of Appeal right after allowing the appeal to order a refund of US$16,180.00 to the respondent on or d before 30 days from today?” The plaintiff before the court of trial who was the respondent before the court below is the respondent/cross- appellant before this court. In its brief it formulated three e issues from the main appeal and two issues from the cross- appeal. The issues in the main appeal are:– “(i) Whether it was right for the lower court to hold that the Supreme Court’s decisions in A.M.O. Akinsanya v U.B.A. f (1986) 4 NWLR (Part 35) 273; Nasaralai Ent. Nig. Ltd v Arab Bank (1986) 4 NWLR (Part 36) 409 and A.G. Bendel State v U.B.A. (1986) 4 NWLR (Part 37) 547 are on all fours with these proceedings without any distinction as to the facts and circumstances of the instant appeal and on this g basis decide that the UCP Rules were applicable to this transaction. (ii) Whether considering all the relevant facts of this appeal, the Court of Appeal exercised its discretion correctly when it h made a consequential order for trial de novo of the suit and the refund of $16,180.00 US Dollars value of the letter of credit that was not utilized or paid over to the supplier. (iii) Whether the Court of Appeal was right (having regard to the pleadings and evidence) in failing to determine all the i issues submitted by the parties to this appeal.” I observed above that from its cross-appeal, the respondent formulated two issues. The first of the two issues however is identical with the respondent’s first issue on the main j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 317 a appeal. It is therefore unnecessary to reproduce it. The second issue reads:– “Whether the Court of Appeal was right in holding that the b respondent/cross appellant did not join issues with the appellant on the contentious issues of the applicability of the UCP Rules, by its failure to file a reply to the statement of defence.” A perusal of the issues raised by the two parties easily shows c a convergence of interest on the issue of the applicability to this case of the Uniform Customs and Practice for Documentary Credit. Appellant’s issues one and two and the respondent’s issue one in the main appeal and (a) and (b) in the cross appeal raise more or less the same issue. I intend to d consider the same first. Now, the plaintiff in paragraphs 8 to 11 of its statement of claim pleaded thus:– e “8. The defendant, pursuant to the oral agreement between the plaintiff and the defendant, on 12 December, 1986 purportedly issued a Documentary Credit No. LRL.4/86 to which was attached– (i) Summary of application to open irrevocable/ f confirmed I/C No. ORL. 4/86 of 12/12/86. (ii) Exchange control risk indemnity of 12 December, 1986 (iii) Form No. IC/Bill 10 dated 12 December, 1986. g (iv) Foreign exchange requisition form. (v) Invoice No. P 108/86E of November 5, 1986 from Musashi Trading Co. Kobe, Japan. (vi) Bank draft No. 906356 dated 16/12/86 for h N55,569.96. (vii) Form C.188A: advance import duty payment. (viii) Application to purchase foreign currency Form M. (ix) The Universal Insurance Company Ltd receipt for i N612.69 being payment for marine insurance proposal. (x) Certificate of Marine Insurance No. 05800 of 11/12/86. The plaintiff shall found upon and rely on the above j documents and hereby pleads them. The defendant is hereby

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 318 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

given NOTICE to produce the above documents. The a confirmed letter of credit was to remain valid till 13/1/87. 9. The plaintiff shall at the trial contend that apart from the oral agreement between the plaintiff and the defendant, it is part b of the normal duty owed by a bank to its customer to issue confirmed letters of credit in favour of the customer when the customer makes such application and meets with the conditions of the bank. 10. The plaintiff as a customer of the defendant made the c necessary applications and satisfied the conditions laid by the defendant for the grant of a confirmed letter of credit. The plaintiff shall contend that the defendant owed the plaintiff the duty to exercise the usual care expected of a commercial d bank in such circumstances as in this case. 11. In breach of the said oral agreement and the duty of care which the defendant owed the plaintiff, the defendant negligently refused and/or failed to deliver the confirmed letter of credit to the plaintiff’s overseas suppliers, Musashi e Trading Company, Kobe Japan.” In paragraph 5(e) of its amended statement of defence, the defendant pleaded thus:– f “(e) By yet another telex dated 13/8/87 the defendants informed the Bank of Tokyo, Kobe, Japan the fact that their correspondence bank i.e. National West Minster Bank New York had informed the defendants that they had asked them (Bank of Tokyo) to advice and confirm on the letters of g credit in favour of the sellers. The defendants plead this telex. The defendants have done all that is necessary for them to do according to international documentary credit to see to it that the imported goods are exported and that the h beneficiaries are paid and plead Articles 18 and 20 of the Uniform Customs and Practice for Documentary Credits applicable to Nigeria and upon which the relationship between the plaintiffs and the defendants is pegged.” Reading through the pleadings filed by both parties, it is i apparent that the facts leading to this dispute are not much in dispute. The plaintiff pleaded that it paid charges and commissions to the defendant to enable it open a letter of credit in favour of its Japanese supplier. It also bought the j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 319 a equivalent of US$16,180 for the purpose. The defendant admitted that the plaintiff did all these. It further pleaded that it did all that was necessary to ensure that the supplier b received the letter of credit but that the letter of credit in spite of all it had done did not get to the Japanese supplier. The defendant then expressed in paragraph 10 of the amended statement of defence a willingness to refund to the c plaintiff the sum of N49,036.72 which the plaintiff paid to purchase the US$16,180. On 17/6/88, plaintiff’s General Manager testified as PW1. He gave evidence in conformity with the averments on d plaintiff’s statement of claim. It is remarkable that the defendant’s Counsel Mr CMI Egole did not ask PW1 a single question concerning UCP. The only defence witness testified on 7/10/88. He is Mr e Goodluck Chineye Enwe. In his evidence concerning the UCP which was tendered as exhibit “S”. DW1 said:– “We have to go to America to purchase dollars because this is in compliance with Uniform Custom and Practice for Documentary f Credit worldwide. We apply this rule in our transaction. This is the document containing the rules which I said are worldwide. Tendered no objection admitted and marked exhibit ‘S’. We were not negligent. We were not in breach of any contract.” Articles 18 and 20 of exhibit “S” upon which the defendant g relied in paragraph 5(e) of its amended statement of defence provide:– “18. Banks assume no liability or responsibility for the consequences arising out of delay and/or loss in transit of h any messages, letters or documents or for delay, mutilation or other errors arising in the transmission of any telecommunication. Banks assume no liability or responsibility for errors in translation or interpretation of i technical terms and reserve the right to transmit credit terms without translating them. 20. (a) Banks utilizing the services of another bank or other banks for the purpose of giving effect to the instructions of the applicant for the credit do so for the account and j at the risk of such applicant.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 320 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(b) Banks assume no liability or responsibility should the a instructions they transmit not be carried out even if they have themselves taken the initiative in the choice of such other bank(s). b (c) The applicant for the credit shall be bound by and liable to indemnify the banks against all obligations and responsibilities imposed by foreign laws and usages.” The DW1 did not testify that exhibit “S” the UCP had previously been shown to the plaintiff. He did not testify that c the terms of articles 18 and 20 in exhibit “S” were incorporated into the application form for letter of credit which the plaintiff filled and which covered the particular transaction. By its nature, the terms of articles 18 and 20 of d exhibit “S” constitute an “exemption clause” as it seeks to exclude liability for the manner in which the defendant performed its duties. e In his judgment, the trial Judge said concerning exhibit “S”:– “On issue No. 4 I shall refer to the case of Nasaralia Ent. Ltd v Arab Bank (Nig.) Ltd (1986) 4 NWLR (Part 36) 409 – 427. In the main, it is decided in the case that in the system of documentary f credits the parties deal in documents not in goods. It was a case in which the goods were shipped after opening the irrevocable letter of credit. That case is different from the present case where no irrevocable letter of credit was opened as agreed and the goods g ordered were not shipped. This case did not decide that exhibit ‘S’ applied to this particular contract. Exhibit ‘S’ is Uniform Customs and Practice for Documentary Credits and from the evidence before me it does not apply in this case. I hold the view that it can operate in a country that subscribes to it and there is nothing to h show Nigeria has done so. Even where it operates, it must be incorporated in the agreement to be binding on the parties. This is not the case here. Article 1 of exhibit ‘S’ provides inter-alia– i ‘They (Uniform Customs and Practice for Documentary Credits) shall be incorporated into each documentary credit by wording in the credit indicating that such credit is issued subject to Uniform Customs and Practice for Documentary Credits 1983, revision ICC Publication No. 400’. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 321 a This is not so in the instant case where letter of credit was not established by the defendants as agreed. Having caused a breach of a fundamental term of the agreement namely establish letter of credit within three months, the defendants cannot avail themselves b of exemption clause. See Gibaud v Great Eastern Railway (1921) 2 KB 426 – 435; Doyin Investment (Nig.) Ltd v First Bank (Nig.) Ltd Suit No. ID/1240/87 decided on 21/4/88 – unreported and Chitty on Contract 25th Edition paragraphs 879 and 888 at pages c 471 and 485.” The court below, whilst considering the applicability of UCP said at pages 230 – 231 of the record:– “From the foregoing the crux of this appeal garnered from the d issues is whether UCP is applicable in Nigeria and in particular to the transaction which led to the dispute. The International Chambers of Commerce based in Paris which has been the champion, sponsor, originator and e founding father of UCP is not shown to be an agency of the United Nations Organization but an international body that had since 1933 took initiative in having a universal standardisation of letter of credit with its current rule to be f the one made in 1983 admitted. It is not a treaty between nations but an international trade custom or convention. So one may describe exhibit “S” (UCP) as international customary practice and usage. g Having been so accepted it can be so labeled as international trade customary usage in commercial trade of letters of credit. Can it then be treated as a “CUSTOM”. h The importance of letters of credit also called documentary credits are the most frequent method of payment for goods in the export trade that made Donaldson U with the concurrence of Ackner, LJ said (sic) in Intraco Ltd v Notis Shipping Corporation of Liberia, The Bhoja i Trader (1981) 2 Lloyds Rep. 256:– “Irrevocable letters of credit and bank guarantees given in circumstances such that they are equivalent to an irrevocable letter of credit have been said to be the life blood of commerce. j Thrombosis will occur if, unless fraud is involved, the courts

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 322 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

intervene and thereby disturb the mercantile practice of treating a rights thereunder as being equivalent to cash in hand.” See Chapter 24 page 336 Schmitthoff Expo Trade: The Law and Practice of International Trade (8ed). b And at page 233 – 234, the court below said:– “In the instant appeal the cases of Nasaralai Ent. Ltd v Arab Bank (Nig.) Ltd (1986) 4 NWLR (Part 36) 409; A.M.O. Akinsanya v United Bank for Africa Ltd (1986) 4 NWLR (Part 35) 273 were c decided on the interpretation of the UCP, the issue about its applicability in Nigeria was not in issue the cases were decided that UCP applied in Nigeria.” In The Attorney General Bendel State and 2 others v United Bank d for Africa Ltd (1986) 4 NWLR (Part 37) page 547, Coker, J.S.C. applied their previous judgment in A.M.O. Akinsanya v United Bank for Africa (Supra) the issue of applicability of UCP in Nigeria was not raised so it could not have been considered.” In order to determine whether or not the court below was e right, it is necessary that I closely examine the judicial decisions which were relied upon in the judgment of the court below. In Akinsanya v United Bank for Africa Ltd (1986) 4 NWLR (Part 35) 273, an appeal on a suit between a f banker and customer as in the instant case, this court per Eso, JSC at page 303 said:– “The relationship is one of a banker and customer. But not quite. In an ordinary banking transaction, a customer requiring a loan or g overdraft facility enters into a simple informal contract known to the common law or, if a statutory provision is involved in the contract – known to statute. In an application for a documentary credit under discussion, there is a standard form of application the form usually incorporates the Uniform Customs and the buyer is h required to fill the document where the terms of the contract are set out in detail. In the instant appeal, such application is exhibit B. Exhibit B is the form provided by the issuing Bank, the respondents, in this case, and though the Uniform Customs are not i specified in exhibit B, exhibit C which the respondent issued to the paying or confirming bank, that is, the Swiss Bank, the following is contained. ‘Except as otherwise stated this credit is subject to the Uniform Customs and Practice for Documentary Credits j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 323 a (1974 Revision) International Chamber of Commerce Brochure No. 290’. It is to be noted however, that non-incorporation of this Uniform b Customs in Ex. B., is certainly not an issue in this case. The issuing bank (respondent in this case) has a duty to ensure that the letter of credit issued to the seller, in this case. ASDECAMO, complies strictly with the instructions of the buyer (in this case, the appellant) contained in the application for the credit and also c that the credit is to the effect that payment, acceptance or negotiation is effected only on presentation of documents which fully accord with the terms of the credit.”(Italics mine.) As made manifest by Eso, JSC in the above passage, the d non-incorporation of UCP was not an issue in the appeal. So this Court did not have to decide whether or not the UCP is generally applicable in disputes between a banker and its customer on letters of credit. This case was therefore no e authority for the proposition that UCP is generally applicable in Nigeria even in cases where parties have not expressly incorporated the UCP into their contracts. Now in Nasaralai Ent (Nig) Ltd v Arab Bank Nigeria Ltd f (1986) 4 NWLR (Part 36) 409, the dispute was between banker and customer concerning a letter of credit issued by the banker at the instance of the customer. Reading through the report, one garners that parties had expressly g incorporated the terms of the UCP. I say this because at page 421 of the report, one of the defences put across by the respondent (ie the defendant to the suit) was:– “(2) that the issuance of the letter of credit was subject to the h general conditions for opening of documentary credits by the respondent which the appellant agreed to and executed and that by virtue of the said general conditions the respondent was not liable to the appellant in the claim.” i Further at page 424 of the report, Bello, JSC (as he then was) said:– “The basic tenor of the law and practice relating to commercial letter of credit is that parties deal in documents not in goods or j ships. Article 8(a) of the Uniform Customs and Practice for

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 324 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Documentary Credit, 1974 which apply to the letter of credit a (exhibit C) in this appeal provides . . ..” (Italics mine.) The tenor of the language in the passage above conveys that this Court did not have to decide in the appeal the question b whether or not the UCP apply in all disputes involving letters of credit. Clearly therefore the general applicability of UCP was not an issue in the case. And finally is the case of A-G Bendel State v UBA (1986) c 4 NWLR (Part 37) 547. This was a case between banker and customer. This case certainly did not decide that in all disputes between banker and customer arising from non- compliance with the terms of payment, the UCP necessarily d apply. In the report at page 554, the customer specifically agreed to some terms. The relevant passage states:– “The application was under a signature stamped ‘Director of Finance. Mid West Mass Communication Corporation’. This e application (exhibit 4) also contains a very important clause. It reads– ‘We agree to hold you and your correspondence harmless and indemnified in all respect of any loss or damage that may f arise in consequence of error or delay in transmission of your correspondents (sic), messages or misrepresentations thereof or from any cause beyond your or their control’.” One gets the impression from this report that in order to g make UCP applicable the banker/customer ought to have specifically incorporated its terms into their contracts. As I observed earlier, articles 18 and 20 upon which the defendant relied are in the nature of exemption clause. There h was no evidence that the articles were incorporated in the forms filled by the plaintiff. (See exhibits “A” – “A4”). There was no evidence that the plaintiff’s attention was at anytime during the negotiation directed to exhibit “S”. Clearly, the defendant is caught by the well established i principle in the law of contract that a defendant relying on an exemption clause must show that the plaintiff had been made aware of the exemption clause. See Richardson, Spence and Co and another v Minnie Rowntree (1894) AC j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 325 a 217 at 220 per Lord Herschell, LC and Hood v Anchor Line (Henderson Bros) Ltd (1918) AC 837. The conclusion is inescapable that the court below was b too sweeping in its conclusion that the UCP applies to all transactions relating to letters of credit between banker and customer irrespective of whether or not the parties had adverted their minds to it in the application for the issuance c of a letter of credit. It seems to me that the parties themselves may only incorporate any of the provisions of the UCP into their contract if they are so inclined. Indeed. article 1 of UCP recognises the optional nature of the d applicability of the UCP when it says:– “These articles apply to all documentary credits including to the extent to which they may be applicable standby letters of credit are binding on all parties unless otherwise expressly agreed. They shall be incorporated into each documentary credit by wording in e the credit indicating that such credit is issued subject to Uniform Customs Practice for Documentary Credits.” It is helpful to call to mind the views of Raymond Jack in the book Documentary Credits 1993 (2ed) at page 9 f paragraphs 1 – 22 where the learned author writes:– “The Uniform Customs consist of 49 Articles which set out provisions which are intended to regulate many aspects of documentary credit operations. They are promulgated by the ICC g and are made effective by their incorporation into credits by the banks of countries whose banking associations have accepted them. They are not intended to be a code having the force of law. For the ICC cannot, and does not purport to, legislate. In this h respect they are quite different in nature to the many International Conventions, such as those on carriage, which have the force of law, in the countries parties to them. In contrast the Uniform Customs must rely upon contract, that is, agreement, for their binding effect in each credit contract where they are incorporated. i Their contractual nature is fundamental to their understanding. Secondly, although their coverage is growing more comprehensive with each revision, the Uniform Customs do not purport to cover all questions which may arise in connection with credits. The title gives an indication of their nature, Uniform Customs and Practice. j They do not purport to be a code setting out the law relating to and

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 326 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

governing credits in the way, for example that the English Sale of a Goods Act, 1893 and it’s successor of 1979 intended to codify and also in some respects to change the English Common Law relating to sale of goods ... There is therefore a considerable areas which is left to the national courts of whatever country to be called upon to b decide a dispute.” It seems to me that the matter falls to be considered under section 74(1)(a)(i) of the Evidence Act on matters which must be judicially noticed. The section provides:– c “74 (1) The Court shall take judicial notice of the following facts– (a) all laws or enactments and any subsidiary legislation made thereunder having the force of a d law now or heretofore in force or hereafter to be in force in any part of Nigeria– (i) all general customs, rules and principles which have been held to have the force of law e in or by any of the superior courts of law or equity in England, the Supreme Court of Nigeria or the Court of Appeal or by the High Court of the State or of the Federal Capital Territory, Abuja or by the Federal High Court f and all customs which have been duly certified to and recorded in any such court.” My humble view is that until a convention acquires the force of law by incorporation into the body of laws of this country g or is shown to be a custom or usage of trade which has been regularly recognised and upheld by the superior courts in Nigeria as to acquire general acceptance, a party in a civil suit wishing to rely on it must prove its existence, and the h fact that the parties have agreed to their contract to let such convention or custom govern their relationship. A party relying on the terms of an international convention or protocol must show proof that Nigeria has subscribed to i such convention. In the instant appeal, the defendant in my view woefully failed to show that the terms of the UCP had been incorporated into the application for letter of credit made by j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 327 a the plaintiff so as to make the plaintiff bound by the exemption clause contained therein. It is my firm view that the court below was in error to have concluded that the UCP b applied to the letter of credit transaction between the parties. This conclusion notwithstanding, the plaintiff still had the duty to establish that the defendant negligently failed to perform the contractual duty owed to it. This takes me to c appellant’s issue No. 2. The court below having arrived at the conclusion that UCP was applicable to the facts of this case proceeded to conclude that its conclusion disposed of all the other issues raised for determination. d When an intermediate appellate court reaches a conclusion on one or some of the issues raised before it, it should normally proceed to consider the other issues bearing in mind that its conclusion may be set aside by a higher e court in the hierarchy. There are recognized exceptions to this practice. Where an appellate court reaches the decision to send the case back to the trial court for re-hearing it should normally refrain from considering other issues as this f may prejudice a fair determination of the issues at the hearing. Considering that the court below later sent back the case for rehearing. I do not accept that the failure to consider all the outstanding issues as an error. But I find it difficult to understand why the court below having decided to send the g case to the High Court for retrial later went on to order the defendant to pay US$16,180 to the plaintiff. The next question arising is whether or not the court below having determined that the UCP was applicable h should not have proceeded to determine the appeal on the basis of the conclusion which it reached. The UCP had been tendered at the trial as exhibit “S”. Having reached the conclusion that UCP was applicable the court below should i have proceeded to determine the appeal on the basis of that conclusion since no issue of credibility of evidence or witnesses arose in the matter. See Okpiri and others v Jonah and others (1961) 1 All NLR 102; (1961) 1 SCNLR 174; j Fatoyinbo v Williams (1956) 1 FSC 67; (1956) 1 SCNLR

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 328 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

274 and Shell BP Petroleum Development Company (Nig) a Ltd v Cole and others (1978) 3 SC 183. In the light of my conclusion that the UCP did not apply, I shall now proceed to consider the outstanding issues. The b plaintiff’s claim was expressed to be in negligence. However, where a plaintiff who brings an action in tort is driven to rely on a contract to sustain his suit, the action must be seen as an action in contract. In this case, the c foundation of plaintiff’s claim is the agreement between it and the defendant for the latter to open for plaintiff a letter of credit. The suit is therefore one in contract. In order to succeed, the plaintiff must call evidence of the contract itself d and of the breach. There is no doubt in this case that the defendant failed to or was unable to transfer the letter of credit to the Japanese supplier. Given the fact that the Letter of Credit was to be valid in the first instance up to 13/1/87, e time was certainly of essence in the contract. Notwithstanding that the time for the defendant to offer performance was extended, the defendant failed and/or neglected to get the letter of credit to the Japanese supplier. f At pages 85 – 86 of the record of appeal, the trial court in its judgment said:– “On issue (No. 2) counsel submitted there was controverted evidence that plaintiffs did all they were expected to do in g executing their own part of the agreement. See exhibits A – A9 and G – G8. There was evidence impliedly admitted by the defendants that the defendants did not at all carry out their own part of the contract. There was no pleading or evidence known to the law why the defendants were in breach of the contract. The h agreement was for the defendants to create an irrevocable letter of credit in favour of the plaintiff’s customers in Tokyo Japan. This the defendants did not do. No evidence the defendants ever contacted the said beneficiaries in Tokyo Japan. No evidence i defendants made inquiries why there was no reaction from the Bank in Tokyo. The beneficiaries wrote they had not received the money exhibits B – B2 and exhibits E and E2. The beneficiaries could not ship the goods ordered unless they received the irrevocable letter of credit (L/C). j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 329 a The defendants’ letters to their bank in New York are self serving evidence not supported by any outside evidence. It is agreed on both sides that the life time of letter of credit is three months. That makes time of essence of the contract. The defendants did not b create letter of credit within the said three months or within the extended time. Defendants are liable for breach of contract.” I agree with the trial court on the conclusion it reached in the above passage. c What is the measure of damages in a case as this? In Omonuwa v Wahabi (1976) 4 SC 37 at 47– 48, this Court per Idigbe, JSC explained the basis of compensation and the measure of damages in a case of breach of contract thus:– d “In the preparation of the claim for, as well as in the consideration of an award in consequence of a breach of contract, the measure of damages is the loss flowing naturally from the breach and incurred in direct consequence of the violation. The damages recoverable e are the losses reasonably foreseeable by the parties and foreseen by them at the time of the contract as inevitably arising if one of them broke faith with the other. In the contemplation of such a loss there can be no room for claims which are merely speculative or sentimental unless these are specially provided for by the terms of f the contract. It is only in this connection that damages can be properly described as ‘special’ in the conception of contractual awards and it must be borne in mind that damages normally recoverable are based on the normal and presumed consequences g of the breach complained of ... Thus the terms ‘general’ and ‘special’ damages are normally inept in the categorization of damages for the purpose of awards in cases of breach of contract. We have had to point out this before ... and we must make the point that apart from damages naturally resulting from the breach h no other form of general damages can be contemplated . . . (Italics supplied by Idigbe, JSC.) (See Swiss Nigeria Wood Industries Ltd v Danilo Bogo HSC 14/70 of 3 July, 1970, reported in (1970) 1 NCLR 423 at 430 – i 431). And on the same subject, this Court in the case of Gregoire Agbaje v National Motors Ltd observed as follows:– ‘It is undesirable to refer in contract to general and special damages as normally the only damages, other than those arising j naturally, flow from consequences specifically provided for by the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 330 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

parties which would not otherwise naturally arise from a breach of a the contract . . .’ (Italics supplied by Idigbe, J.S.C). (See SC.20/68 of 13 March, 1970 unreported by see (1970) ALR 266 at 273.” In his evidence in support of the plaintiff’s claim, PW1 at b page 46 of the record of appeal gave evidence of the special damages suffered by the plaintiff thus:– “For special damages we claim the money spent on purchase of 16,180 (dollars) i.e. N55,699.55k for advance of import duty N5,569.96k, for Marine Insurance Proposal N645.69k for c Commissions and charges N1,685.47.” In addition to the above the PW1 gave evidence that the plaintiff was claiming N1,936,432.23 as general damages. In a case for breach of contract, a claim for general damages is d generally inappropriate. In support of its claim on this head PW1 at page 46 of the record said:– “If the defendant had handled the letter of credit efficiently and properly, the plaintiff could have made profit of over e N750.000.00. The defendant should pay this loss.” The plaintiff did not call evidence to establish the basis upon which it could have made a profit of N750,000. The evidence called was that the plaintiff wanted to import raw f materials. No attempt was made to prove how the profit of N750,000 was to be realised. The total cost of importation including the cost of adding other materials to the raw materials to realise a particular end product was not stated. g The selling price of each of the end product was not stated. The claim of a prospective profit of N750,000 was clearly not made out. It is in my view speculative. On the evidence available the plaintiff is only entitled to h be compensated for the following:– 1. Amount spent to purchase $16,180.00 N55,699.85 2. Advance of import duty 5,569.96 i 3. Marine Insurance Proposal 642.69 4. Commission and Charges paid to the defendant 1,685.47 Total N63,597.97 j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 331 a The PW1 under cross-examination testified that the sum of N55,699.85 earmarked for the purchase of $16,180.00 was not wholly utilised for the purpose and that there was a b surplus of N6,662.92 which the defendant paid back into plaintiff’s account. This amount must be deducted from N63,597.97 to arrive at the net sum lost by the plaintiff on the transaction. This c leaves the sum of N56,935.05 payable to the plaintiffs. The contention of the appellant in the appeal is that the court below was in error to have ordered that the case be tried de novo after agreeing that the UCP applied to the case. d Further, the appellant contended that the court below was in error not to have considered the other issues raised in the appeal, and to have awarded US$16,180.00 to the respondent. e The respondent/cross-appellant on the other hand contended that the court below was wrong to have held that the UCP was applicable to the case. f I have considered the standpoints of the parties together in this judgment. It is my view that the court below was in error to have concluded that the UCP applied to the case and to have awarded a sum of US$16,180 to the g respondent/cross-appellant whilst at the same time sending the case back for retrial. The truth is that the respondent/cross-appellant did not make a claim for the dollar equivalent of the amount paid for the purchase of the h US$16,180. Rather the claim was for N55,699.65. The result is that the main appeal succeeds in part and the award of US$16,180.00 must be set aside. Similarly the order for retrial is set aside. The cross-appeal also succeeds i in that it is my finding that the UCP did not apply to this case. The final orders to be made are these:– j 1. The judgment of the court below is set aside.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Oguntade JSC 332 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

2. In its place it is ordered that the defendant pay to the a plaintiff the sum of N56,935.05 being the amount expended by the plaintiff in the attempt to transfer the sum of US$16,180 to plaintiff’s overseas supplier b through the defendant.

KALGO JSC: I entirely agree with the leading judgment just delivered by my learned brother, Oguntade, JSC. The main c appeal is hereby allowed in part and the cross-appeal also succeeds and is allowed. I abide by the consequential orders made in the judgment including the order as to costs.

TOBI JSC: On 12 December, 1986, the respondent d approached the appellant’s Branch Office at Orlu with a proforma invoice from Kobe Japan for purchase of $16,180 US Dollars for importation of raw materials by the respondent. The respondent paid the appellant the Naira e equivalent of the dollars which the appellant was to transmit by means of a confirmed letter of credit to the respondent’s suppliers, Messrs Musashi Trading Company, Kobe, Japan. On the same date and day, the appellant, pursuant to oral f agreement between them, purportedly issued a documentary credit No. ORL.4/86 to which were attached the relevant documents. Musashi Trading Company Kobe, Japan did not receive the confirmed letter of credit on 13 April, 1987 when g the life span of the letter expired. Time was extended to 15 July, 1987 at the request of the appellant. The letter of credit was still not received. The appellant asked for extension for the second time to 6 October, 1987. The respondent refused. h Not able to wait any longer, the respondent sued for damages arising from negligence or in the alternative for breach of contract. The learned trial Judge gave judgment to the respondent. i He found the appellant liable to damages which he awarded in the generally usual two parts:– N63,567.77 special damages and N1,000,000.00 general damages. The appellant appealed to the Court of Appeal. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 333 a That court allowed the appeal but remitted the case for trial de novo before another Judge of the High Court, Orlu. In the penultimate paragraph of the judgment, the Court b of Appeal said at page 247 of the record:– “Having held that exhibit ‘S’ (UCP) is applicable to this transaction it is the law under the provision of UCP and as decided in my unreported judgment Suit No. LD/424/ 77 between Wasuani c GMBH v Best Stores Ltd delivered on 13 October, 1981 that in the application of UCP, parties cannot switch the currency of the letter of credit to another currency to wit there cannot be a shift of the currency of the letter of credit in the instant appeal which is American US Dollars $16,180.00 to any other currency this court d therefore orders to mitigate the position of the respondent that the appellant refunds to the respondent its fund $16,180.00 on or before 30 days from today.” Aggrieved by the decision, the appellant appealed to the e Supreme Court. Briefs were filed and duly exchanged. I will take two issues. First, is whether the Court of Appeal was right in ordering a trial de novo after holding that exhibit “S” was applicable in the case? Second is whether the Court of f Appeal was correct in awarding $16,180 to the respondent? It is the argument of learned Counsel for the appellant that the Court of Appeal having held exhibit “S” is applicable in the case; the court should have held that the appellant was g not liable in negligence or breach of contract. He also submitted that the order for the appellant to pay the respondent the sum of US$16,180 is not consequential to the order allowing the appeal and therefore an order made h without jurisdiction. Learned Counsel for the respondent submitted that the UCP rules are not applicable to the case and that the Court of Appeal was wrong in reversing the decision of the trial i court on the issue. She submitted that the order of retrial and refund of the cost of the letter of credit were made by the Court of Appeal in the proper exercise of its discretionary power and the finding was reached after an examination of j the facts and circumstances of the case. To set aside the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC 334 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) order for retrial or refund of the value of the letter of credit a would occasion a greater miscarriage of justice than to grant it, learned Counsel submitted. Exhibit “S” is the Uniform Customs and Practice for b Documentary Credit bearing or wearing the cognomen UPC. The UPC promulgated by the ICC consists of 49 Articles. The Court of Appeal cited the case of Akinsanya v United Bank for African Ltd (1986) 4 NWLR (Part 35) 273, c particularly where Eso, JSC traced the historical aspect of global and universal standardisation of letters of credit in international trade and commerce at page 300 of the judgment. d Learned Counsel for the respondent submitted that the case of Akinsanya v United Bank for African Ltd is inapplicable. She cited the following dictum from the e judgment of Eso, JSC:– “It is to be noted however, that non incorporation of the Uniform Customs in Ex. B (Application form) is certainly not an issue in this case.” f The above is not per se basis for argument that the UPC rules do not apply in Nigeria. If a Judge says that a particular matter is not an issue before him, he should be taken as saying that the matter does not arise in the case. He should g not be taken as saying that the matter is not applicable in the case. It is the argument of learned Counsel for the respondent that UPC Rules can only apply to transactions if the parties h expressly incorporate them in the basic document. She did not see any such incorporation in exhibit “S” and therefore faulted the Court of Appeal in holding that the exhibit was applicable in the case. Counsel made brilliant efforts to draw i a distinction between the facts of this case and those of Akinsanya. She did not however tell this Court whether in Akinsanya, the UPC rules were incorporated in exhibit “B”, the standard form. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 335 a Learned Counsel for the respondent said that this Court essentially found for the erring/defaulting issuing banks because of the exemption clauses expressly contained in the b application forms for the credit which was canvassed to the advantage and benefit of the issuing banks. With respect, I do not agree with learned Counsel. As a matter of fact, Eso JSC in his judgment of about 30 pages devoted about two c pages to the examination of the exclusion clause raised by Professor Kasunmu. Eso, JSC had arrived at his conclusions ever before (sic) he took the issue of exclusion. And what is more, both parties appealed. The appeals failed and they were dismissed. It is therefore not correct for Counsel to say d that the issue of exemption was the basis of “this court deciding in favour of the erring/defaulting issuing banks”. While learned Counsel for the respondent has called the e attention of this Court to some differences between Akinsanya and this case, there are also similarities. They are (1) Importation of goods. (2) Letters of credit. f (3) Standard form. (4) Special and general damages for negligence and or contract. g It is difficult to come across two cases of or with exactly the same facts. They may look alike like siamese twins but may not be exactly the same to the last sentences, words and letters. This is because the circumstances leading to the h litigation in relation to the facts may be different. The difference could be minute or infinitesimal, but there is a difference. The doctrine of precedent comes into the fore when the facts of two cases are materially similar in their i content of actuality or reality. And here the court is concerned with nitty gritty of the facts in the context of determining the live issues before the court. The court is not concerned with peripheral or auxiliary facts which merely j add to the building of the factual structure of the case. While

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC 336 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

I agree that this is a very difficult exercise in our adjectival a law for the courts, courts of law have never been known to deal with cases involving very simple mental exercise. In the exercise, the court will ignore for good what I may wish to b call for want of better expression parasitic or inarticulate facts, which the court can comfortably or conveniently avoid, in arriving at a proper decision. Perhaps I can put it in another way for better understanding. While the court has a c duty to arrive at when facts are material in their content of actuality or reality, and when they are peripheral or auxiliary, the underlying factor is whether the facts are facts enough to arrive at the decision of the court one way or the other. If they are not that material, then the court should feel d free to ignore the promptings of Counsel to invoke the doctrine of precedent. In the determination of this aspect of his procedural duties, the Judge should avoid surmises but must be concerned with the facts of the two cases before e him, the one forming the baseline and the other physically before the Judge for application. Taking the above in the context of the decision of this f court in Akinsanya v UBA, I am less with learned Counsel for the respondent and I am more with the Court of Appeal. This is because there is more in favour of the use of Akinsanya in this case than not using it. I have been able to enumerate some of the similarities. To my mind, the facts of g Akinsanya are more material to this case and are less peripheral and auxiliary. I do not intend to take the other two cases as Counsel placed more emphasis on Akinsanya. h If a court nurses the idea of sending a case back for a retrial, the court should not keep the idea to itself but should let the parties know so that they have an opportunity to address the court on it. It is trite law that a court of law cannot raise an issue suo motu and resolve it suo motu. In i this case, none of the parties asked for a retrial. It was the decision of Court of Appeal and that court was under a duty to ask the parties to address it on the retrial before giving judgment. The Court of Appeal was in serious error in j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 337 a raising the issue suo motu in one breath and resolving it in another breath. I go to the second issue. It is in respect of the award of b US$16,180 to the respondent by the Court of Appeal. It is elementary law that a court is bound by the relief or reliefs sought. The generosity or charity of a court of law is confined strictly to the relief or reliefs sought to the extent c that a court of law cannot give to a party what he did not claim. That is completely outside our procedural law. The rationale behind this is that a party who comes to court knows where the shoe pinches him and therefore knows the d limits of what he wants. The court, as an unbiased umpire, so to say, cannot claim to know the relief or reliefs better than the party and give him over and above what he has claimed. While a court has jurisdiction to award less than e what a party claims, it has no jurisdiction to award more than what he claims. In this case, the appellant inter alia claimed damages in Naira. It is N55,699.65. The particulars of claim 5(1) were f couched as follows:– “Refund of money spent in purchasing US$16,180.00... N55,699.65”. It is clear that the relief was never in US Dollars but was on g the Nigerian Naira and so the Court of Appeal had no jurisdiction to order that the money should be refunded in US Dollars. This is because the appellant did not seek such relief. h Learned Counsel for the respondent in some desperation cited the case of Services Europe Atlantique and (SEAS) v Stockholms Rederiaktiebolag SVEA. The Folias [1978] 2 All ER 764. The Court of Appeal in England held that in the i award of damages for breach of contract, the award should be made in the currency most truly expressing or reflecting plaintiff’s actual loss. In the case, the court held that as the Charteress actual loss was the amount of French Francs j expended by them in acquiring the cruzeiros necessary to

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC 338 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) settle the cargo receivers’ claim, the award therefore should a be expressed in French Francs. The SEAS case is not apposite to this appeal. SEAS had to do with competing currencies of the US Dollar and the b French Francs. There is no such competition of currency in this appeal. The relief in this appeal was clearly in Naira and Naira only. It will be wrong to confuse the act of purchasing the Dollar as an alternative relief because there is no such c relief. Agreed, the respondent bought US Dollars but that was not the amount claimed. In the circumstances, the Court of Appeal was in error to order the refund of $16,180.00 “on or before 30 days”. I do not agree with the Court of Apeal d that this is a case where equity will “mitigate the position of the respondent” because the case does not involve the application of the principles of equity. It is rather a very straightforward matter of tort and/or contract and so the Court of Appeal was wrong in trying to push in equity. Hard e and ossified the common law is, it remains a separate and distinct branch of our law, separate and distinct from equitable principles. This is not an appropriate case to rope in the principles of equity. Even if one is willing to rope f them in, equity will be very reluctant to afford any help to the respondent because it will be a complete stranger in the matter. Learned Counsel for the respondent referred to the orders g made by the Court of Appeal for retrial and refund as consequential orders. A consequential order is an order that follows as a result of the earlier one which can be called for this purpose as the main order. It may have an indirect or h secondary result in the relief awarding process. A consequential order is appurtenant to the main or principal order. A clearly fresh order cannot be a consequential one. That will certainly throw overboard the English meaning of i the word. While an order of retrial could qualify as a consequential order, I have my strong doubts whether an order of giving judgment in a currency that was not claimed by the plaintiff can qualify as such order. It is clearly a fresh order and has not the slightest element of consequence. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tobi JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 339 a Let me return to the order of retrial which I agree could be consequential. But there is one procedural hurdle to cross by the court ordering a retrial and it is allowing the parties to b address on it. I have said it above. I do not want to go further here. The Court of Appeal did not allow the parties to address it on the retrial. That was a very serious error. It is in the light of the above I too allow the appeal in part. c I award N55,699.65, the amount claimed to the respondent. The order of retrial is set aside.

MOHAMMED JSC: I have had the privilege before today of d reading in advance, the lead judgment of my learned brother, Oguntade, JSC which has just been delivered. I am in full agreement with him in the manner he considered and resolved all the issues arising for determination in this e appeal and the cross appeal. I have nothing useful to add to the judgment which I wholly adopt as mine including the order on costs.

TABAI JSC: I read in draft, the leading judgment prepared f by my learned brother, Oguntade, JSC and I agree with the conclusion therein. The facts which are essentially undisputed are clearly restated in the leading judgment and I need not repeat them. g I would, by way of emphasis, however comment briefly on the controversy about the applicability or otherwise of the Uniform Customs and Practice for Documentary Credit. The trial court deliberated on the issue and held that the Uniform h Customs and Practice for Documentary Credit only applied to a country that subscribes to it and since there is no evidence that Nigeria has subscribed to it, it does not operate in this case. The court went further to hold that even where it i applies, it must be incorporated in the agreement to be binding on the parties. For its opinion the court relied on Nasaralai Ent (Nig) Ltd v Arab Bank Nigeria Ltd (1986) 4 NWLR (Part 36) 409 and article 1 of exhibit “S” (the j Uniform Customs and Practice for Documentary Credit).

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 340 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The court below relying on Nasaralai Ent (Nig) Ltd a v Arab Bank Nigeria Ltd (supra); Akinsanya v UBA (1986) 4 NWLR (Part 35) 273 and A-G, Bendel State and others v UBA (1986) 4 NWLR (Part 37) 547 and court’s duty b to take judicial notice of customs that have achieved notoriety, held that the Uniform Customs and Practice for Documentary Credit is applicable in this country and also applicable in this case. Counsel for both parties c addressed fairly extensively on the applicability or otherwise of the Uniform Customs and Practice for Documentary Credit. I have read the three cases of this Court. And although in d each of the cases references were made to the Uniform Customs and Practice for Documentary Credit, none of them decided that for every international trade transaction involving the procurement of letters of credit the issuing e bank and confirming bank invariably enjoys immunity provided by the exemption clause in the Uniform Customs and Practice for Documentary Credit. It is my view that even where they are held to apply in this country, whether or not f the parties are bound by its provisions depends on the peculiar facts of each case. This is the necessary deduction from the opinion of Kayode Eso, JSC in the case of Akinsanya v UBA (supra) at pages 302 – 303 where, after reproducing article 12 of the Uniform Customs and Practice g for Documentary Credit, he said:– “Though it would appear that this article, particularly sub (a) and (b) provide both the issuing bank, the appellant, and the confirming bank (the Swiss Bank) with immunity, the learned h authors of Law of Bankers’ Commercial Credits – H.C. Gutteridge and Maurice Megrah are of the view and I am in full agreement that the provisions should not be taken to give banks a carte blanche to do as they please and ‘if one commits flagrant mistake i the responsibility and the loss will not be applicant for the credit’ applied to this case, the appellant should not bear the responsibility and loss, if the Swiss Bank pays upon defective documents. This accords with ordinary laws of the land and commonsense. A person shall not profit by his own delict.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC Eagle Super Pack (Nigeria) Limited v ACB Plc 341 a I agree entirely with this opinion which I accordingly adopt. The court below proceeded as though the applicability of the exemption clause embodied in the Uniform Customs and b Practice for Documentary Credit was absolute defence for the defendant/respondent. I think that was in error. An exemption clause in a contract may not avail a party who has been guilty of a fundamental breach of the contract. See c Chitty on Contract (23ed) paragraph 732, page 329. In my view, the whole case is whether or not the defendant/respondent is liable for breach of the contract. At pages 85 – 86 of the record of appeal the learned trial Judge d expressed his assessment of the case of the defendant/ respondent in the following terms:– “There was evidence impliedly admitted by the defendants that the defendants did not all carry out their own contract. There was no e pleading or evidence known to law why the defendants were in breach of the contract. The agreement was for the defendants to create an irrevocable letter of credit in favour of the plaintiff’s customers in Tokyo Japan. This the defendants did not do. No evidence the defendant ever contacted the said beneficiaries in f Tokyo Japan. No evidence defendants made inquiries why there was no reaction from the bank in Tokyo. The beneficiaries wrote they had not received the money exhibits B – B2 and exhibits E and E2. The beneficiaries could not ship the goods ordered unless they received the irrevocable letter of credit. g The defendants’ letter to their bank in New York are self serving evidence not supported by any outside evidence. It is agreed on both sides that the life time of letter of credit is three months. That makes time of essence of the contract. The defendant did not h create letter of credit within the said three months or within the extended time. Defendants are liable for breach of contract.” The reasoning and conclusion above is supported by the evidence on record and there is no assertion of its being i perverse. I agree with the learned trial Judge that the defendant/respondent is liable for breach of contract. For the foregoing and fuller reasons articulated in the leading judgment of Oguntade, JSC I also hold that the main j appeal succeeds. The result is that the judgment of the Court

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 342 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) of Appeal is set aside and that the trial court allowing the a claim restored. The general damages awarded by the trial court is however set aside. And in its place judgment is entered for the sum of N56,935.05. b Appeal allowed in part.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

Balogun v Egba Onikolobo Community Bank (Nig) Ltd 343 a Balogun v Egba Onikolobo Community Bank (Nig) Ltd b COURT OF APPEAL, IBADAN DIVISION FABIYI, AWALA, OKORO JJCA Date of Judgment: 11 DECEMBER, 2006 Suit No.: CA/I/139/02 c Banking – Interest – Right of bank to charge – Principles governing

Facts d This is an appeal against the judgment of Honourable Justice Bode Popoola delivered on 15 February, 2001 while sitting at the High Court of Justice, Abeokuta, Ogun State. At the court below, the appellants were defendants while the e respondent the plaintiff. The respondent’s claims against the appellants at the court below as contained in the amended statement of claim dated 3 February, 1998 are for:– “(i) The sum of N1,728,369.63 (One Million, Seven Hundred f and Twenty-eight Thousand, Three Hundred and Sixty Nine, Sixty- three Kobo) only being money payable by the defendants to the plaintiff, for money lent by the plaintiff to the defendants and for money paid by the plaintiff for (sic) to the defendants as Bankers for the defendants at their g requests, and for interest agreed to be paid upon money due from the defendants to the plaintiff as at 31st day of May, 1997. (ii) Interest at the rate of 21% per annum from 1 June, 1997 h until payment. (iii) A rental fee of N1,000 per month from 1 June, 1997 until the removal of the Toyota Celica by the first defendant. (iv) Cost.” i The appellants, apart from denying the respondents’ claims above, also made a counter-claim. The learned trial Judge, after hearing evidence from both parties, entered judgment for the respondent partially in the j first relief by awarding the sum of N1 Million to her, being

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

344 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) money lent by the respondent to the appellants and awarded a interest thereon at the rate of 21% per annum from the first day of June, 1997 until payment is fully made. The learned Judge also awarded a rental fee of N1,000 per month from 1 b June, 1997 until the first appellant removes the Toyota Celica car from the respondent’s premises and finally, the court dismissed the counter-claim of the appellants. Being dissatisfied with the judgment of the learned trial c Judge, the appellant has appealed to the Court of Appeal while the respondent cross-appealed.

Held – d 1. Whereas between a banker and the customer/borrower, there is express agreement as to the rate of interest payable, the bank is entitled to charge an interest rate on the basis that there is an established custom to that effect e or that the customer has impliedly consented where, without protest, he allows his account to be debited with such interest. 2. It is trite that interest may be claimed as a right where it f is contemplated by the agreement between the parties as in this case. 3. A party who claims interest has the duty to plead and proffer credible evidence in proof thereof. g 4. A distinction has to be made between interest awarded by a court pursuant to the rules of that court and those awarded as a result of facts pleaded and evidence led on same. Under the Ogun State High Court (Civil h Procedure) Rules and particularly Order 40 rule 7:– “The court at the time of making any judgment or order, or at any time afterwards, may direct the time within which the payment or other act is to be made or done reckoned from i the date of judgment or order or from some other point of time, as the court thinks it fit and may order interest at a rate not exceeding ten naira per centum per annum to be paid upon any judgment, commencing from the date thereof or afterward, as the case may be.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

Balogun v Egba Onikolobo Community Bank (Nig) Ltd 345 a 5. But in the instant case, the claim of interest which was awarded by the learned trial Judge is not based on the above quoted rule of court. Facts pleaded and evidence b adduced including the findings of the learned trial Judge show that there was a relationship of banker and customer between the parties. Appeal allowed in part. c Cases referred to in the judgment Nigerian d Adeniji v Fetuga (1990) 5 NWLR (Part 150) 375 Ajayi v Texaco (1987) 3 NWLR (Part 62) 577 Ajuwon v Akanni (1993) 9 NWLR (Part 316) 182; (1993) 12 SCNJ 32 e Akeredolu v Akinremi (No. 3) (1989) 3 NWLR (Part 108) 164 Alao v ACB (1998) 3 NWLR (Part 542) 339; (1998) 2 SCNJ f 17 Anyaoke v Adi (1986) 3 NWLR (Part 31) 731 Bello v Attorney-General of Oyo State (1986) 5 NWLR (Part 45) 828 g Dabup v Kolo (1993) 9 NWLR (Part 317) 254; (1995) 12 SCNJ 25 Egbunike v ACB (1995) 2 NWLR (Part 375) 34; (1995) 2 h SCNJ 58 Enang and others v Adu (1981) 11–12 SC 25 Himma Merchants Ltd v Aliyu (1994) 5 NWLR (Part 347) 667; (1994) 6 SCNJ (Part 1) 81 i Ishola v Societe-General Bank (Nig) Ltd (1997) 2 NWLR (Part 488) 405 Jallco v Owoniboys Technical Services Ltd (1995) 4 NWLR j (Part 391) 534

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

346 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Jeric (Nig) Ltd v Union Bank of Nigeria Plc (2000) 15 a NWLR (Part 691) 447; (2000) 12 SCNJ 184 Lewis and Peats Ltd v Akhimien (1976) 7 SC 157 Mogaji v Odofin (1978) 4 SC 91 b Niger Construction Ltd v Okugbeni (1987) 4 NWLR (Part 67) 787; (1987) 2 SC 108 Obot v CBN (1993) 8 NWLR (Part 310) 140 c Ogunleye v Oni (1990) 2 NWLR (Part 135) 745 Ohadugha v Garba (2000) 14 NWLR (Part 687) 226; (2000) FWLR (Part 16) 2721 d Oje v Babalola (1991) 4 NWLR (Part 185) 267 Okoya v Santilli (1994) 4 NWLR (Part 338) 256; (1994) 2 SCNJ 333 Onifade v Olayiwola (1990) 7 NWLR (Part 161) 130; (1990) e 11 SCNJ 10 Onwuka Hi-teki v ICON Ltd (1992) 2 NWLR (Part 226) 733 Owena Bank v Nigerian Stock Exchange (1997) 8 NWLR f (Part 515) 1; (1997) 7 SCNJ 160 Spasco Vehicle and Plant Hire Co Ltd v Alraine Nig Ltd (1995) 8 NWLR (Part 416) 655 State v Gwonto (1983) 1 SCNLR 142 g Uba v Union Bank Plc (1995) 2 NWLR (Part 405) 72 UBN v Ogboh (1995) 2 NWLR (Part 380) 647 Uredi v Dada (1988) 1 NWLR (Part 69) 237 h Nigerian statute referred to in the judgment Court of Appeal Act, section 16 i Nigerian rules of court referred to in the judgment Court of Appeal Rules, 2002, Order 3 rule 14 High Court (Civil Procedure) Rules of Ogun State, Order 40 rule 7 j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION)

Balogun v Egba Onikolobo Community Bank (Nig) Ltd 347 a Book referred to in the judgment Precedents of Pleadings Bullen and Leake and Jacobs (12ed) page 106 b Counsel For the appellants: Adeyemi (with him E Olu-Alade, Esq.) For the respondent: Oyebolu c Judgment OKORO JCA: (Delivering the lead judgment) This is an appeal against the leading judgment of Honourable Justice d Bode Popoola delivered on 15 Feruary, 2001 while sitting at the High Court of Justice, Abeouta, Ogun State. At the court below, the Appellants were defendants while the respondent the plaintiff. The respondent’s claims against the appellants e at the court below as contained in the amended statement of claim dated 3 February, 1998 are for:– “(i) The sum of N1,728,369.83 (One Million, Seven Hundred and Twenty-eight Thousand, Three Hundred and Sixty-nine f Naira, Eighty-three Kobo) only being money payable by the defendants to the plaintiff, for money lent by the plaintiff to the defendants and for money paid by the plaintiff for (sic) to the defendants as Bankers for the defendants at their requests, and for interest agreed to be paid upon money due g from the defendants to the plaintiff as at 31st day of May, 1997. (ii) Interest at the rate of 21% per annum from 1 June, 1997 until payment. h (iii) A rental fee of N1,000 per month from 1 June, 1997 until the removal of the Toyota Celica by the first defendant. (iv) Cost.” The appellants, apart from denying the respondents’ claims i above, also made a counter-claim as contained in a further amended statement of defence and counter-claim dated 16 February, 1998. Since I have set out the claims of the respondents in the court below, it is in the interest of justice j that the counter-claim of the appellants should also be

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 348 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) eminently reflected herein. The appellants’ counter-claims a are as follows:– “(i) Declaration that the rate of interest charged on Account No. 02 – 171 since the inception of the account till May, 1996 is b not in keeping with the interest rate permissible by the Central Bank of Nigeria and is therefore ultra vires the plaintiff and so null and void and illegal. (ii) In consequence of (i) above, an order annulling the illegal c rate of interest charged on Account No. 02 – 171 operated by the first defendant but kept by the plaintiff from the inception of the said account till the date of judgment. (iii) Declaration that the rate of interest charged on Account No. 02 – 158 since the inception of the said account till May, d 1996 is not in keeping with the interest rate permissible by Bank of Nigeria and is therefore ultra vires the plaintiff and so null, void and illegal. (iv) In consequence of (iii) above, an order annulling the illegal e rate of interest charged on the said Account No. 02 – 158 operated by the second defendant but kept by the plaintiff from the date of the inception of the said account till the date of judgment. f (v) An order compelling the plaintiff to use the rate of interest approved in the Central Bank of Nigeria guidelines in working the rate of interest on Account Nos. 02 – 171 and 02 – 158. (vi) An order compelling the plaintiff to pay to the first g defendant the sum of N500,000.00 being the value of the Toyota Celica Car deposited with the plaintiff by way of equitable mortgage but sold by the plaintiff without the consent of the first defendant. h (vii) An order for the payment of N500,000.00 being the reasonable cost of the hire per day from 3/6/96 when the Celica Car was sold by the plaintiff till the date of judgment and until the car is delivered to the defendant. i (viii) In the alternative to (vi) above, an order compelling the plaintiff to deliver to the first defendant the said Toyota Celica Car, property of the first defendant in good and roadworthy condition, certified by an automobile engineer to be so roadworthy.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 349 a The learned trial Judge, after hearing evidence from both parties, entered judgment for the respondent partially in the first relief by awarding the sum of N1 million to her, being b money lent by the respondent to the appellants and awarded interest thereon at the rate of 21% per annum from the first day of June, 1997 until payment fully made. The learned Judge also awarded a rental fee of N1,000 per month from 1 c June, 1997 until the first appellant removes the Toyota Celica car from the respondent’s premises and finally, the court dismissed the counter-claim of the appellants. Being dissatisfied with the judgment of the learned trial d Judge, the appellants have appealed to this Court. It seems to me desirable at this stage to set out briefly the background facts to the present dispute between the parties which have culminated in this appeal. e On 30/9/93, the first appellant opened Account No. 02- 171 with the respondent and on 5/2/94 the second appellant opened her own account No. 02-158 also with the respondent. The relationship went on smoothly until August, f 1995 when the appellants stopped depositing any further money into their accounts to defray their indebtedness to the respondent. In 1996, the appellant solicitors protested against the agreed rate of interest charged on the appellant’s g indebtedness. As a result, the interest rate was brought down from 10% per month to 21% per annum. In August, 1996, the first appellant made a request to the respondent that the appellants be allowed to pay the sum of N1 million in full and final settlement of their indebtedness to the respondent. h The respondent accepted this on condition that the payment of the N1 million be made within a week. The appellants later made a fresh request that the amount be reduced to N800,000. This new offer was rejected by the respondent. i When the first appellant entered into this relationship with the respondent in 1993, she deposited with the respondent, by way of an equitable mortgage, two Toyota cars, one of which is still with the respondent although the first appellant j alleges that it had been sold by the respondent without her

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 350 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) consent. Respondent says the car is still parked in its a premises and is attracting a parking charge of N1,000 per month. That the first appellant can collect it at any time upon settlement of her indebtedness to the respondent. b Originally, the appellants filed three grounds of appeal and with the leave of court additional three grounds. So, this appeal is being contested on six grounds of appeal. c Pursuant to Order 3 rule 14 of the Court of Appeal Rules, 2002, the respondent filed a respondents notice dated 15 December, 2003, indicating its intention to contend at the hearing of this appeal that the decision of the lower court should be varied by increasing the sum awarded to the d respondent from N1 million to N1,728,369.83 on the ground that there was credible evidence led and accepted by the learned trial Judge to support the entire claim of the respondent in the said sum of N1,728,369.83. And in the e alternative that this Court should affirm the decision of the court below on grounds other than those relied upon by that court. Of the six grounds of appeal, the appellants distilled five f issues for determination by the Court. These are:– “(1) Whether on proper consideration of the defence and counter- claim of the appellants the learned trial Judge would not have held that the respondent was not entitled to judgment on the g claim before the court since the contractual relationship of the respondent and the appellants was illegal, null and void and of no effect and therefore dismissed the action of the respondent in its entirety while granting the reliefs sought by h the appellants in their counter-claim, and making consequential orders as the justice of the case demands. (2) Whether the interest of 21% per annum on the judgment debt awarded to the respondent from June 1, 1997 until judgment debt is liquidated is correct in law. i (3) Whether the respondent has proved by evidence the claim for rent in the storage of the Toyota Celica Car, the property of the first appellant which was a security for a loan from the respondent. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 351 a (4) Whether on a proper evaluation of the evidence oral and documentary the finding of the learned trial Judge that there is a negotiated settlement of the debt owed the respondent by the appellant is correct in law. b (5) Whether from the totality of the evidence before the trial court, the judgment of the court is against the weight of evidence.” The respondent’s counsel also formulated five issues for c determination as follows:– “(1) Whether the issue of legality or otherwise of the contractual relationship between the appellants and the respondent raised by the appellants in ground one of their amended notice of d appeal has been resolved on a proper consideration of the entire pleadings, and accordingly, does not require to be determined by the trial court. (2) Whether the interest of 21% per annum awarded on the judgment debt from 1 June, 1997 until payment of judgment e debt is correct and proper. (3) Whether the learned trial Judge was right in giving judgment to the respondent based on the negotiated settlement of the debt owed by the appellants to the respondent. f (4) Whether the learned trial Judge properly evaluated the totality of the evidence adduced by the parties before entering judgment for the respondent and dismissing the counter-claim of the appellants. g (5) Whether the decision appealed against should be varied or affirmed on grounds other than those relied upon by the court below.” Having carefully looked at the two set of issues formulated by both parties it is clear that the issues are identical as h follows:– (a) Issue No. 1 of appellant’s brief is the same as issue No. 1 of respondent’s brief. i (b) Issue No. 2 of the appellant is identical to issue No. 2 of the respondent. (c) Appellants issue No. 3 stands alone. (d) Issue No. 4 of the appellant tallies with issue No. 3 j of the respondent.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 352 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(e) The 5th issue of the appellants accords with the 4th a issue of the respondent. (f) The 5th issue of the respondent stands alone being distilled from the respondent’s notice. b I intend to treat the issues in the above order. Appellant’s Counsel submitted on the first issue that the learned trial Judge failed to consider whether or not the c respondent has a licence to operate as a bank. That the Judge failed to consider paragraph 1 of the reply to defence to counter-claim wherein the appellants stated that the respondent had no licence. That in the absence of any d licence, the learned trial Judge ought to have pronounced the transaction between the parties illegal, null and void. That although the respondent pleaded in paragraphs 1 and 5 of the amended statement of claim that he has a licence, no e evidence was led to prove it and he urged, relying on Egbunike v ACB (1995) 2 NWLR (Part 375) 34; (1995) 2 SCNJ 58 that those paragraphs had been abandoned. He urged this Court to invoke section 16 of the Court of Appeal f Act and pronounce on the illegality or otherwise of the transaction. Learned Counsel also submitted that his copious address on the issue of illegality was never considered by the learned trial Judge. Moreso, that once a contract is declared illegal, no party can derive benefit under the g contract and he cited two cases of– 1. Okoya v Santilli (1994) 4 NWLR (Part 338) 256; (1994) 2 SCNJ 333 at 364 h 2. Alao v ACB (1998) 3 NWLR (Part 542) 339; (1998) 2 SCNJ 17. On the counter-claim, learned Counsel submitted that a counter-claim does not fail merely because the main claim i has succeeded – relying on Jeric (Nig) Ltd v Union Bank of Nigeria Plc (2000) 15 NWLR (Part 691) 447; (2000) 12 SCNJ 184 at 201. That the trial Judge ought to have considered the counter-claim separately and made findings j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 353 a of facts before dismissing same and referred to Dabup v Kolo (1993) 9 NWLR (Part 317) 254; (1995) 12 SCNJ 25. In his reply, the learned Counsel for the respondent b submitted that since the appellants did not controvert paragraphs 1 and 5 of the amended statement of claim in their further amended statement of defence, those paragraphs are deemed admitted. He relied on Lewis and c Peat v Akhimien (1976) 7 SC 157; Ajuwon v Akanni (1993) 9 NWLR (Part 316) 182; (1993) 12 SCNJ 32 at 51; Uredi v Dada (1988) 1 NWLR (Part 69) 237 among others. Also that since the defence to counter- claim did not raise the issue of d legality of the transaction between the parties, the raising of the issue of legality in the reply filed by the appellants is irregular and should be declared null and void. He cited Spasco Vehicle and Plant Hire Co Ltd v Alraine Nig Ltd e (1995) 8 NWLR (Part 416) 655 at 670 among others. He urged this court to resolve this issue against the appellants. The issue of the illegality of the transaction between the parties is a very serious one for if found to be so, no party f can take any benefit of whatever magnitude from it. See Alao v ACB (supra) wherein the Supreme Court held that “an illegal contract is a void contract and it cannot be the foundation of any legal right” (at page 28). Being such a g serious matter, it must be properly raised before a court in order to merit a consideration. This is a matter which should be specifically pleaded. On receipt of an amended statement of claim the appellants filed a further amended statement of defence. Nowhere in the amended statement of defence did h the appellants challenge paragraphs 1 and 5 of the statement of claim which alleged that the respondent is a licenced Community Bank. As at that point, the appellants are deemed to have admitted that fact. This is so because i pleadings are meant primarily to let parties know each other’s case. Therefore, all matters not denied in the pleadings whether raised in the statement of claim or statement of defence are taken as admitted. See Ogunleye v j Oni (1990) 2 NWLR (Part 135) 745 at 766 – 767 paragraphs

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 354 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

G–A, see also Lewis and Peats Ltd v Akhimien (1976) 7 SC a 157. It is trite therefore that any fact expressly admitted or deemed admitted in a party’s pleadings need not be proved by the other party. See Uredi v Dada (1988) 1 NWLR (Part b 69) 237. It can safely be said that as at that point, there was no issue raised as to the illegality of the transaction. c However, after the receipt from the respondent of his reply to statement of defence and defence to counter-claim, the appellants filed a reply to defence to counter-claim wherein they stated for the first time that the respondent has no licence to transact any banking business and that the d transaction between the parties was illegal, null and void. The question is, was this issue properly raised before the lower court? e It is trite that the purpose of filing a reply is to counter new issues raised in the defence. I agree completely with learned Counsel for the respondent that since the defence to the counter-claim did not raise the issue of legality of the transaction between the parties, the raising of the issue of f legality or otherwise of the transaction in the reply filed by the appellants for the first time appears strange and inconsistent with the practice in this Court. A reply as I know is the plaintiff’s answer or response to any issue raised g by the defendant in his defence and which the plaintiff seeks to challenge, deny or admit or object to either on grounds of law or a misstatement of the cause of action. It is not allowed or permissible in a reply to the defence to raise a h new cause of action not set out in his writ of summons. See Adeniji v Fetuga (1990) 5 NWLR (Part 150) 375 at 391 paragraphs A–C, see also Obot v CBN (1993) 8 NWLR (Part 310) 140; Onwuka Hi-teki v ICON Ltd (1992) 2 NWLR i (Part 226) 733. I hold the firm view that the raising of non-possession of licence in the reply to defence to counter-claim is a new issue and as such, it is invalid, irregular, null and void. The j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 355 a learned trial Judge, in my opinion was right to ignore such unwholesome practice. And in any case, the appellants did not challenge the b evidence of the respondent at least by cross-examination when it testified through PW1 and PW2 that it was legally operating as a Community Bank. What more, the appellants did not lead any evidence to support the alleged illegality. c Where evidence is given by a party in any proceedings and is not challenged by the opposing party who had opportunity to do so as in this case, it is always open to the court seised of the proceedings to act on the unchallenged evidence, see d Uba v Union Bank Plc (1995) 2 NWLR (Part 405) 72; Union Bank of Nigeria v Ogboh (1995) 2 NWLR (Part 380) 647. Learned Counsel for the appellants had submitted that his e copious address on the issue of illegality was not considered by the learned trial Judge. It should be noted that addresses are designed to assist the court. Therefore, no amount of brilliance in the address of Counsel can make up for the lack f of evidence to prove and establish or else disprove and demolish any point in issue. See Niger Construction Ltd v Okugbeni (1987) 4 NWLR (Part 67) 787; (1987) 2 SC 108 at 144. g On the issue of the counter-claim, it seems to me that the appellants had abandoned it as evidence was not led to prove the averments in the counter-claim. The address of learned Counsel for the appellants on the issue of the counter-claim h before the lower court was based on averments on the counter-claim and not on evidence before the court. Where facts pleaded are not proved by credible evidence, those facts are deemed abandoned. See Egbunike v ACB (1995) 2 i NWLR (Part 375) 34; (1995) 2 SCNJ 58. The summary of all I have said above is that issue No. 1 is resolved against the appellants as I hold that the learned trial Judge was right in ignoring the issue of illegality of the j transaction as same was not made an issue before him.

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 356 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Issue No. 2 has to do with the award of 21% interest per a annum from 1 June, 1997 until final payment is made. The learned trial Judge had ordered interest on the sum of N1 million being the judgment sum as the second claim of the b respondent against the appellant. The learned Counsel for the appellant submits and relies on Order 40 rule 7 of the High Court (Civil Procedure) Rules of Ogun State that the award is wrong in law. He also relies on the case of Himma c Merchants Ltd v Aliyu (1994) 5 NWLR (Part 347) 667; (1994) 6 SCNJ (Part 1) 81 at 87 and 97. That the interest ought to have been 10% per annum with effect from 15/2/01 when judgment was entered. d In reply, the learned Counsel for the respondent submitted that the award of interest in this case by the learned trial Judge was not based on the High Court (Civil Procedure) Rules cited above but on the facts pleaded and evidence e adduced at the trial. He relied on these cases:– 1. Jallco Ltd v Owoniboys Technical Services Ltd (1995) 4 NWLR (Part 391) 534. 2. Ishola v SGB Ltd (1997) 2 NWLR (Part 488) 405. f I think a distinction has to be made between interest awarded by a court pursuant to the rules of that court and those awarded as a result of facts pleaded and evidence led on same. Under the Ogun State High Court (Civil g Procedure) Rules and particularly Order 40 Rule 7:– “The court at the time of making any judgment or order, or at any time afterwards, may direct the time within which the payment or other act is to be made or done reckoned from the date of h judgment or order or from some other point of time, as the court thinks fit, and may order interest at a rate not exceeding ten naira per centum per annum to be paid upon any judgment, commencing from the date thereof or afterwards, as the case may be.” But in the instant case, the claim of interest which was i awarded by the learned trial Judge is not based on the above quoted rule of court. Facts pleaded and evidence adduced including the findings of the learned trial Judge show that there was a relationship of banker and customer between the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 357 a parties. That initially, the first appellant signed an agreement ie exhibit “A” to pay interest of 10% per month on loans granted her but later demanded a reduction of the interest b from 10% per month ie 120% per annum to 21% per annum and the respondent agreed to the reduction with effect from June, 1996. This particular interest is the one claimed specifically by the respondent based on their transaction. c The appellants had opportunity to defend this suit but failed to contest with the respondent on this claim. A party who claims interest has the duty to plead and proffer credible evidence in proof thereof. In this case there was express agreement on the rate chargeable. The appellants have not d denied signing this agreement. They only renegotiated the interest rate which was pegged at 21% per annum. Whereas between a banker and the customer borrower, there is no express agreement as to the rate of interest payable, the bank e is entitled to charge interest rate on the basis that there is an established custom to that effect or that the customer has impliedly consented where, without protest, he allows his account to be debited with such interest. See Ishola v SGB f (Nig) Ltd (supra). It is trite that interest may be claimed as a right where it is contemplated by the agreement between the parties as in this case. See Jallco Ltd v Owoniboys Tech Services Ltd (supra). g The interest awarded by the learned trial Judge to the respondent falls within this later regime of interest. Order 40 Rule 7 of the Ogun State High Court (Civil Procedure) h Rules and the case of Himma Merchants Ltd v Aliyu (supra) relied upon by the appellants are inapplicable. I accordingly uphold the interest as awarded by the learned trial Judge. Issue No. 2 is in the circumstance i resolved against the appellants. On issue No. 3 of appellants brief, the respondent has no answer to it and it seems to me that this has been conceded. As part of the judgment of the lower court, the learned trial j Judge ordered the appellants to pay N1,000 per month from

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 358 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

1 June, 1997 as rental fees for the Toyota Celica car parked a in the respondent’s premises. Now, apart from the fact that the respondent had claimed this amount, there was no credible evidence to warrant such b an award. There is no evidence that the respondent agreed with the appellants that such a fee would be charged. If anything, it was the respondent who made the deposit of the car a condition for the grant of a loan. From the onset, it was c not the intention of the parties that rent should be paid on the parking space. The respondent cannot, unilaterally and without prior notification, negotiation and agreement with the appellants charge such rent on the car. I have no d difficulty in holding that in the circumstance of this case, the respondent can’t claim rent on the parking of that car. The learned trial Judge was therefore wrong to have made that order. Accordingly, that order shall be set aside. This issue e in my opinion should be resolved in favour of the appellants. As I had earlier stated above, issue No. 4 of appellants’ brief is the same as issue No. 3 of the respondents brief and I will proceed to consider same. f In addition, I intend also to treat this issue with issue No. 5 of the respondent’s brief since they are so closely related. For basing the award of N1 million to the respondents on g the alleged “negotiated settlement sum agreed by both parties”, the learned Counsel for the appellants submitted that the award is baseless and that it was not borne out of the evidence before the court. He added that it is because the h respondent’s claim was not proved that the learned trial Judge decided to unilaterally award the N1 million to the respondent. That it was a grave error in law by the court to award such a claim and relies on Owena Bank v Nigerian Stock Exchange (1997) 8 NWLR (Part 515) 1; (1997) 7 i SCNJ 160 at 174; Ajayi v Texaco (1987) 3 NWLR (Part 62) 577 at 593. It was his further contention that from a proper construction of exhibits “K”, “M” and “N”, the attempt by the parties to arrive at a negotiated settlement of the debt due j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 359 a from the appellants to the respondents failed and accordingly, that the learned trial Judge was in error to have given judgment based on a “non-existing” negotiated b settlement. Learned Counsel for the respondent conceded that the parties failed to reach an agreement as to the exact amount payable during the negotiation but he urged the court to hold c that the lower court properly regarded the initial offer made by the appellant to pay one million Naira in full and final settlement of their debt as an admission that they were owing the respondent a minimum sum of N1 million. He d urged the court to affirm the judgment of the lower court on that ground of admission rather than on the ground of any “negotiated settlement”. He urged the Court also to invoke section 16 of the Court of Appeal Act and affirm the e judgment on that ground. There is no doubt that the N1 million awarded by the learned trial Judge based on the “negotiated settlement” was not the amount claimed by the respondent. It was higher f than that. Indeed, the respondent’s claim was for the sum of N1,728,369.83k. It is trite that a court is without power to award to a claimant what he did not claim and/or prove. See Ajayi v Texaco (Nig) Ltd (supra) at 593 E–F; Owena Bank v g Nigerian Stock Exchange (supra). Can it be said that in the instant case the learned trial Judge awarded what was not asked for or that he awarded less than what was asked for and in doing so basing it on a wrong premise? The learned h trial Judge, before coming to that conclusion spent time to review the evidence and I think that part of the judgment is of moment and I shall reproduce same. On pages 108–109 of the record, the learned trial Judge said:– i “The two accounts against the defendants stand at about N889,000 less interest, and from the internal memos in exhibits R – R7, it is established that the plaintiff had sourced the money given to the defendants from different sources at 8.5% per month for 90 days, 8.0% per month for 180 days, 8.0% per month for 60 days j respectively, and as supported by the evidence of PW1 that the

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 360 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

plaintiff did not enjoy any liquidity relief from anywhere but had a to source for fund (sic), which evidence I accept. However, a new agreement and deal on the amounts standing to the debit of the defendants on the two accounts of N889,000.00 as b above, was struck upon the negotiated settlement sum of N1 million by exhibit K of 8/8/96 and was agreed upon by both parties particularly the defendants, possibly realizing that adding the accrued interest, would exceed N1 million and so exhibits M and N from the parties emanated to further reduce the N1 million c to N800,000.00 which was not accepted by the plaintiff. It would now appear both parties have settled the matter for N1 million in 1996 as per exhibits K, M and N being the agreed negotiated settlement sum (even failure to pay this N1 million before 10/12/96, the plaintiff threatened in exhibit N that the accounts d revert to ‘status quo ante’ of the total sum of N1,335,121.52) debt as at November, 1996 which would then be due and payable plus accrued interest to date. Exhibit N aforesaid is dated 18/11/96. It was because the defendants did not take advantage of the e negotiated settlement sum that the plaintiff took out summons about 8 months later on 1/7/97. It is therefore reasonable to allow the negotiated settlement sum plus interest allowable by the Central Bank – an umbrella of all the Banks.” f From the lengthy quotation above, it is seen that the learned trial Judge did his best in trying to show his sympathy to the appellants. What actually stopped him from entering judgment in the higher sum claimed? It is very clear that the appellants initially admitted to pay the sum of N1 million in g full and final settlement of the debt owed and the respondent accepted same provided payment was made within one week. But as parties were not committed to the negotiated amount, the negotiation invariably collapsed. But before h then, the appellants had admitted owing the respondent at least N1 million in the first instance as clearly shown in exhibits “K”, “M” and “N”. It is my well-considered view that it is wrong to say that i the learned trial Judge awarded what was not asked for. Rather he awarded less than what was asked for though basing the award on a reason. Granted that the learned trial Judge made an error in the reason he used to base his j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 361 a judgment, but is such error enough to vitiate he judgment? The Supreme Court in Oje v Babalola (1991) 4 NWLR (Part 185) 267 has stated that:– b “It is not every mistake or error in a judgment that will result in the appeal being allowed. It is only when the error is substantial in that it has occasioned a miscarriage of justice that the appellate court is bound to interfere (p. 282 paragraph C).” c Has the judgment of the learned trial Judge in the instant case led to a miscarriage of justice? I do not think so. Is it a mistake that can be corrected? I am of a firm view that based on the evidence adduced at the lower court and the evaluation of same by the learned trial Judge as d quoted above, this is a proper situation where such error should be corrected and not allowed to defeat the ends of justice as:– “The court is more interested in substance than in mere form. e Justice can only be done if the substance of the matter is examined. Reliance on technicalities leads to injustice.” See State v Gwonto (1983) 1 SCNLR 142 at 160 (per Eso, JSC). See also Onifade v Olayiwola (1990) 7 NWLR (Part f 161) 130; (1990) 11 SCNJ 10; Bello v Attorney-General of Oyo State (1986) 5 NWLR (Part 45) 828. I had earlier indicated that I intend to determine this issue in conjunction with issue No. 5 of the respondent’s brief g which distills from the respondent’s notice dated 15 October, 2003. The learned Counsel for the respondent had urged this Court to determine whether the decision appealed against should be varied or affirmed on grounds other than h those relied upon by the court below. On this the learned Counsel to the respondent urged this Court to hold that the respondent proved his claim of N1,728,369.83 before the lower court and that this amount ought to have been entered i as judgment sum for the respondent instead of N1 million said to be “the negotiated settlement” which was inconclusive. The learned trial Judge found as a fact that as at j November, 1996, the appellants owed the sum of

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 362 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

N1,335,121.52 to the respondents (see page 109 lines 15–21 a of the record). Both the appellants and the respondent had agreed on the record that the interest chargeable was 21% per annum (see page 84 lines 19–24 and page 87 lines 10–13 b of the record on the evidence of PW2 and DW1 respectively). Again, the PW1 gave an uncontroverted evidence that the respondent sold the first appellant’s car for N200,000 and credited this amount to the first appellant’s c account and that the said amount attracted interest at the agreed rate of 21% per annum from September, 1996 to 1 June, 1997 which increased the amount to N246,290. However, this sum had to be reversed following a strong protest by the appellants (see page 78 lines 19–32). The sale d of the said car was also cancelled. When this sum is added to the earlier sum as accepted by the learned trial Judge and with interest at 21%, this will increase the amount payable to N1,728,396.83. The appellants did not object to this e evidence at the lower court. The respondents tendered through PW2 on page 84 of the record exhibits “II” – “III” being statements of account in respect of Account Nos. 02– 158 and 02–171. I am of a well-considered opinion that f enough and credible evidence was placed before the learned trial Judge to act upon in respect of the respondent’s claim before him. He accepted this evidence but somehow, he decided to be sympathetic on the appellants which sympathy g beclouded his eyes and he decided to enter judgment against the appellant on a lesser sum which the appellant had earlier agreed to pay in full satisfaction of the debt. Let me digress a bit at this stage to say that banking is a h serious business wherein depositors’ monies are being given out as loan to others with the hope that it shall be repaid. A situation where customers as in this case collect loans from banks but refuse to pay back only to come to court to speak big grammar has led to the distress of many banks all to the i detriment of innocent depositors. Courts must take a firm stand whenever such matters come before them so as to save the banking industry from total annihilation. Had the learned Counsel for the appellants given a proper advice to the j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 363 a appellants and allowed them to pay the negotiated sum of N1 million, this matter would have been history. But since they wanted a full dose of the action, I think the learned trial b Judge ought to have allowed the respondent to take the benefit of the evidence adduced before the court by entering judgment on the proven sum and not on the failed negotiated settlement sum. I am satisfied that this judgment should be c varied and the judgment sum raised from N1 million granted by the learned trial Judge to N1,728,369.83 being the actual sum claimed and proved by the respondent against the appellants at the lower court. I also vary the reason or d ground which learned trial Judge used in entering the judgment for the respondent. Judgment is entered for the respondent not on the basis of the “negotiated settlement” but on the basis of the fact that the respondent had proven his claim before the trial court. e I am now left with issue No. 5 of appellant’s brief which is in tandem with issue No. 4 of respondent’s brief ie whether the judgment is against the weight of evidence. On f this, the learned Counsel for the appellant submitted and relied on the case of Ohadugha v Garba (2000) 14 NWLR (Part 687) 226; (2000) FWLR (Part 16) 2721 at 2734 paragraphs D–G that from a close look at the totality of the relevant and credible evidence led by the parties at the trial, g especially as it relates to the illegality of the contract and the judgment founded on a negotiated settlement that has no support in reason or in law the judgment can correctly be said to be against the weight of evidence. Also that the trial h Judge dismissed the counter-claim without considering or evaluating the evidence or making any finding whatsoever on the said counter-claim. In response, the learned Counsel for the respondent submitted that Counsel for the appellants i hinged his argument mainly on the issue whether the transaction was legal or not, and whether it was proper for the learned trial Judge to base his judgment on the issue of “negotiated settlement”. That learned Counsel did not j examine, for any moment the evidence led by the parties,

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA 364 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) neither did he show where the learned Judge erred in his a primary duty of putting the totality of the testimony adduced by each party on each side of that imaginary scale. Whenever it is alleged that a judgment is against the b weight of evidence, what it means is that the judgment of the trial court cannot be supported by the weight of the evidence adduced by the successful party, which the trial Judge either wrongly accepted or that the inference drawn or conclusion c reached by the trial Judge based on the accepted evidence cannot be justified. It can also mean that there is no evidence which if accepted would support the findings of the trial Judge. Furthermore, it could mean that when the evidence d adduced by the appellant is weighed against that adduced by the respondent, the judgment given in favour of the respondent is against the whole gamut of evidence adduced before the Judge. See Anyaoke v Adi (1986) 3 NWLR (Part e 31) 731 at 742. At this stage, it is not for this Court to make new findings of fact as this is a preserve of the trial court who had the advantage of seeing the witnesses and watching their f demeanour. If the trial Judge has unquestionably evaluated the evidence before him, it is not for the appeal court to evaluate the same evidence. See Enang and others v Adu (1981) 11–12 SC 25 at 38 – 39 see also Mogaji v Odofin g (1978) 4 SC 91 at 93 – 95. In the instant case, the learned Counsel for the appellant based his argument on the issue of illegality of the transaction which he submits the learned trial Judge failed to h consider. I had earlier in this judgment addressed this matter and I think there is nothing more or new to say again on the issue. I had quoted in extenso the findings of the learned trial Judge in his judgment and I do not intend to repeat it here. i However, let me say that the learned trial Judge did his best in evaluating the evidence adduced before him on pages 107–111 of the record. Although he gave a wrong reason for entering judgment for the respondent, I had since corrected j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Okoro JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 365 a it. The dismissal of the counter-claim, in my opinion, was proper as there was no evidence to sustain same. I have read through the evidence of the first appellant on b pages 86–87 of the record. I think the learned trial Judge was right in dismissing the counter-claim without much ado since there was no evidence led to establish the claims therein. The first appellant who testified as DW1 had c thought that having filed her counter-claim it was automatic that judgment would be entered for her. That is not the legal position. Those averments in the counter-claim ought to have been proved by credible evidence. The failure to lead d evidence to establish the claim meant that she abandoned them. I am satisfied that the learned trial Judge was right in so dismissing the counter-claim. I am also at home with the learned trial Judge in that he evaluated the evidence before e him and attached relevant weight to them. The conclusion he reached in entering judgment for the respondent is upheld but the monetary award made by him has been varied by this Court. This issue therefore does not avail the appellants at all. f The summary of all I have stated above is that this appeal lacks merit and is hereby dismissed. The judgment of the trial Judge is hereby varied from N1 million to g N1,728,369.83 in favour of the respondent. The award of interest of 21% per annum from 1 June, 1997 until final payment is upheld. A rental fee of N1,000 per month from 1 June, 1997 until removal of the Toyota h Celica Car by the appellant from the respondent’s premises awarded the respondent is however set aside on the reasons enumerated by me. I assess and fix costs at N4,000 in favour of the i respondent.

FABIYI JCA: I have been opportuned to read in draft the judgment of my learned brother, Okoro, JCA just delivered. j I agree with the reasons advanced to arrive at the conclusion

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA 366 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) that the appeal basically lacks merit and should be a dismissed. I wish to chip in a few words of my own in support. I need to reiterate the point that the necessity to file a reply by b a plaintiff only arises when:– 1. The plaintiff desires to admit certain facts alleged in the statement of defence or to meet them by asserting c new additional facts; 2. The plaintiff desires to plead an objection on point of law; 3. The plaintiff desires to plead that the defence d misstates the cause of action or; 4. The plaintiff desires to contest a counter claim pleaded in the statement of defence. e For the above, I refer to Precedents of Pleadings by Bullen and Leake and Jacobs (12ed) page 106; Akeredolu v Akinremi (No. 3) (1989) 3 NWLR (Part 108) 164, 172; Ishola v Societe-General Bank (Nig) Ltd (1997) 2 NWLR f (Part 488) 405 at 421. A reply that is rooted on any other ground, as in this matter, must miss the target. I agree that the issue of legality or otherwise of the transaction raised for the first time in the g reply filed by the appellants appears strange and inconsistent. It was to no avail. It is irregular, null and void. It was not worthy of consideration and the learned trial Judge rightly ignored it. h It seems to me that the appellants were merely trying to shirk their responsibility of paying a legitimate debt owed by them to the respondent. The banking industry is the bedrock of any nation’s economic activity. And customers who i borrow depositors’ funds should pay up their debts without rigmarole as herein. It is by so doing that incidents of failed banks will no longer rear their ugly heads as in recent past in our country. j

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Fabiyi JCA Balogun v Egba Onikolobo Community Bank (Nig) Ltd 367 a For my above views and the lucid reasons ably set out in the lead judgment, I too hereby dismiss the appeal. I endorse all the consequential orders contained in the lead judgment, b that relating to costs inclusive.

AWALA JCA: I have read the brilliant judgment of my learned brother Okoro, JCA and I agree with him in all his c conclusions issue by issue he treated. As such, there is nothing I can add except to touch briefly on history of the banking system in this country which corrupt managers and owners together with some unscrupulous customers almost d ruined, until the advent of the present administration, particularly the administration in the Central Bank of Nigeria (CBN), the umbrella body covering all the banks in Nigeria headed by its erudite Governor, Professor Soludo, an internationally acclaimed best Central Bank Governor in e Africa for the year 2006. He is the best thing to have happened to Nigeria to sanitise our banking system in this country. Whereas in the past customers used to borrow money and disappear into thin air as their (sic) share of the f “National cake” and where fraudsters set up mushroom banks here and there to collect money from unwary public and then they go underground, broke, insolvent and “dead”, sometimes only for them to surface or appear in America or g in Switzerland with their loots fully banked, but later themselves actually die as human beings; and the foreign account number untraced. Thus the banked funds get lost, unutilised in this country to create jobs for the teeming h youths and for a buoyant economy. It was sad. We have not reached the top of the problem yet but there is hope. We are now moving in the right direction by the “Soludo revolution” of bank reforms amalgamations and liquidations i of unviable banks en mass is brilliant and good for our financial stability in this country. In the final analysis, I agree fully with my learned brother Okoro, JCA that this appeal lacks merit. I also dismiss it. j The judgment of the trial Judge is hereby varied, also by me,

[2004 – 2006] 13 N.B.L.R. (PART III) (COURT OF APPEAL, IBADAN DIVISION) Awala JCA 368 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) from N1 million to N1,728,369,83 duly pleaded and proved a by the respondent in favour of the respondent. I also abide by the other consequential orders in the lead judgment including the award of cost in favour of the respondent. b Appeal dismissed.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

UBA Plc v BTL Industries Limited 369 a UBA Plc v BTL Industries Ltd b SUPREME COURT OF NIGERIA BELGORE, CJ, ONU, KATSINA-ALU, MUSDAPHER, TABAI JJSC Date of Judgment: 15 DECEMBER, 2006 Suit No.: SC. 301/2003

Banking – Bank not paying overseas suppliers of customer – c Goods already received by customer – Customer claiming refund – Whether customer has the standing to sue Banking – Banker/customer relationship – Breach of contract and negligence – Within jurisdiction of State High d Court Banking – International commercial transaction – Principles governing e Jurisdiction – Banker/customer relationship – Breach of contract and negligence – Within jurisdiction of State High Court Limitation law – Cause of action – When time begins to run f – Principles applicable Locus standi – Bank not paying overseas suppliers of customer – Goods already received by customer – Customer g claiming refund – Whether customer has the standing to sue Facts This is an appeal by the defendant against the judgment of h the Court of Appeal, Lagos Division delivered on 22 July, 2003 in which the aforesaid court confirmed the decision of the trial court. The claim of the plaintiff before the trial court as contained in paragraph 62 of the second further and better i amended statement of claim is as follows:– “1. Declaration that the defendant was in breach of its duty to the plaintiff by its failure to remit to the overseas suppliers the purchase price (in foreign currency) of the goods supplied by its overseas suppliers for which payment was duly made by j the plaintiff.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

370 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

2. An order directing the defendant to pay the sum of– a (a) Pounds Sterling 3,632,872.93 (b) US Dollars 3,384,263.37 (c) French Francs 3,478,031.85 b (d) Deutsche Marks 5,431,790.47 (e) Belgian Francs 3,758,533 10 (f) Dutch Guilders 672,810.34 c (g) Danish Krone 79,515.00 to the plaintiff being the value of the goods ordered from overseas suppliers and received by the plaintiff and for which payment was made in Naira to the defendant at the material time at the prevailing rate of exchange and which the d defendant has failed to remit to the overseas suppliers despite repeated demands. Alternatively to relief 2 above An order directing the defendant to pay to the plaintiff the e naira equivalent of the said sums of money at the prevailing rates for exchange at the time the defendant chooses to pay the plaintiff. 6. The sum of N378,780,244.00 being anticipated profits from f 1985 to 1994. 7. Loss of profit at the rate of N6,302,510.00 per annum from 1994 to date of judgment. 8. Interest on judgment debt at the rate of 75 % until payment is g reflected by the defendant. Alternatively to 1 – 5 above. 9. A declaration that the defendant was in breach of its duty to the plaintiff by its failure to duly inform the plaintiff in 1988 h that the Central Bank of Nigeria had returned the sum of N8,541,557.66 which was to be remitted to the plaintiffs overseas suppliers. 10. An order directing the defendant to pay to the plaintiff the i sum of N8,544,577.66 returned by the Central Bank of Nigeria to the defendant with accrued interest to date. 11. An order directing the defendant to pay to the plaintiff the difference in exchange rates in 1988 and the prevailing rates of exchange by the Central Bank of Nigeria at the time of j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

UBA Plc v BTL Industries Limited 371 a judgment or the prevailing rate of exchange as the defendant chooses to pay the sum of– (a) Pounds Sterling 3,632,872.93 b (b) US Dollars 3,384,263.37 (c) French Francs 3,478,031.85 (d) Deutsche Marks 3,431,790.47 (e) Belgian Francs 3,758,533.10 c (f) Dutch Guilder 672,810.34 (g) Danish Krone 79,515.00 12. Interest on the said sum of N8,544,557.66 at the prevailing rate of interest annually in 1988 when the Central Bank of Nigeria released the money to the defendant up to the time of d judgment. 13. The sum of N18,907,530.00 being anticipated profit from 1955 to 1987. 14. Interest at the rate of 7.5 % from time of judgment to the e time of payment by the defendant.” At the trial the plaintiff called five witnesses while the defendant called seven witnesses. Five of them were called in Nigeria, while two of the defendant’s witnesses testified f in London. On the 19/6/2002 learned Counsel adopted their written addresses and in addition orally addressed the court. After an exhaustive treatment of the evidence, the learned trial Judge entered judgment in favour of the plaintiff. g Dissatisfied with the judgment, the defendant lodged an appeal to the Court of Appeal. In its judgment delivered on 22 July, 2003, the Court of Appeal dismissed the defendant’s appeal. Still dissatisfied, the defendant appealed h to, the Supreme Court.

Held – 1. In a claim essentially founded on negligence and breach i of contract, State High Court has the necessary jurisdiction over the subject matter of the dispute. 2. Time therefore begins to run when there is in existence a person who can sue and another who can be sued, and all j facts have happened which are material to be proved to

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

372 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

entitle the plaintiff to succeed. The right of action in this a matter clearly accrued in 1994 when the respondent became aware of the existence of exhibit “C”. The respondent could not reasonably be expected to file an b action against the appellant when the appellant was always giving him assurances that his bills and letters of credit were being processed by Central Bank. Indeed there could be no cause of action. c 3. Where the application to the Central Bank is by the buyer and such an application can only be processed by the banker, a collateral contract arises whereby the banker undertakes to process the application and the d buyer undertakes to pay, contract as has been described emerged, the aggrieved customer can sue and enforce that contract and claim damages where the banker has failed to exercise due care. e 4. It is clear from section 251 of 1999 Constitution that the Federal High Court has only exclusive jurisdiction over matters enumerated in section 251(1)(d) of the 1999 Constitution where such relate to fiscal measures or the f revenue of the Federal Government. The appellant’s claim before the High Court of Lagos State does not in any way relate to any fiscal measure of the Federal Government neither does it relate to the revenue of the g Federal Government. It is a claim founded on the negligence of the respondent bank. Clearly, the High Court of Lagos State has jurisdiction to entertain the suit. 5. Even though Decree No. 107 of 1993 and the 1999 h Constitution enlarged the exclusive jurisdiction of the Federal High Court and reduced the hitherto unlimited jurisdiction of the High Court of Lagos State provided by section 236(1) of 1979 Constitution, the High Court i of Lagos State still has jurisdiction to entertain any claims connected with banks and banking except such claims connected with fiscal measures or revenue of the Federal Government of Nigeria. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

UBA Plc v BTL Industries Limited 373 a 6. As this is a claim of breach of contract by a customer against its bank, the Lagos State High Court has jurisdiction to entertain the claim. The proviso in section b 251(1)(d) is to limit the operation of the foregoing prescription to show that applicability is not general but it does not destroy or divest the Federal High Court of this power. It should therefore be understood to mean c that the Federal High Court enjoys equal power with the State High Court in banking cases involving bank and customer. 8. International commercial transactions invariably involve d four autonomous though interconnected contracts as spelt out in the case of Nasaralai Enterprise Ltd v Arab Bank (Nig) Ltd (1986) 4 NWLR (Part 36) 409. In the case in hand, those four contracts were as follows:– e i. The first contract is the underlying contract of sale between the Nigerian buyer and a foreign seller. ii. The second contract was between the Nigerian buyer the plaintiff/company and his bank the f defendant. Under this second contract the Nigerian bank the defendant was under a contractual obligation to issue the credit in strict conformity and compliance with all the instructions of the g plaintiff and the prevailing law in that regard. iii. The third contract was between the defendant bank now the issuing bank and a foreign bank where the seller or its vendor resides. This bank is the h confirming bank. Under this third contract the Nigerian bank, the defendant in this case, undertakes to reimburse the Bank of Tokyo, Thailand for all payments it made to the vendor, i Grain Company on presentation by the World Grain Company documents which ex facie conform with the terms and condition of the credit. The plaintiff’s case here is that the Bank of j Thailand was grossly negligent in failing to detect

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

374 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

obvious inconsistencies and contradictions a apparent on the face of the documents presented to it. It is also the plaintiff’s case that the defendant was negligent in not detecting the irregularities on b the documents and in not stopping payment. iv. The fourth contract was between the Bank of Tokyo, Thailand and the world Grain Company Limited of Thailand. Under this contract the Bank c of Tokyo, Thailand undertook to pay World Grain Company Limited of Thailand the amount on the credit against presentation of stipulated documents. d 9. There is nothing in refinancing exercise which encourages evasion of international obligation. The aim it is contended is to enhance settlement of outstanding imports, adding that all the imports are claimed through e the legitimate Central Bank of Nigeria (CBN) Regulations since they all ought to be matched but for the negligence, dishonesty or deceit of the appellant. The misconception of the appellant in imputing public policy f or act of State to defeat legitimate transaction being what this Court has deprecated in the case of Onwuchekwa v NDIC (2002) 5 NWLR (Part 760) 371 at 392. Appeal allowed in part. g Cases referred to in the judgment Nigerian Adah v NYSC (2004) 13 NWLR (Part 891) 639; (2004) 7 SC h (Part 11) 139 Adesanya v President, Federal Republic of Nigeria (1981) 2 NCLR 358 i Adewuyi v Abidade 4 WACA 169 Afolayan v Ogunrinde (1990) 1 NWLR (Part 127) 369 A-G, Kaduna v Hassan (1985) 2 NWLR (Part 8) 483 A-G, Kwara State v Olawale (1993) 1 NWLR (Part 272) 645 j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

UBA Plc v BTL Industries Limited 375 a A-G, Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255 AIC Ltd v NNPC (2005) 11 NWLR (Part 937) 563 b Ajayi v Mil Admin, Ondo State (1997) 5 NWLR (Part 504) 237 Akeredolu v Akinremi (1989) 3 NWLR (Part 108) 164 c Akibu v Azeez (2003) 5 NWLR (Part 814) 643 Akinola v Oluwo (1962) 1 SCNLR 352 Akinsanya v UBA Ltd (1986) 4 NWLR (Part 35) 273; (1986) 2 NSCC 980 d Akintola v Balogun (2000) 1 NWLR (Part 642) 532 Aladegbemi v Fasanmade (1988) 3 NWLR (Part 81) 129 Alfotrin Ltd v A- G, Fed (1996) 9 NWLR (Part 475) 634 e Anaze v Anyaso (1993) 5 NWLR (Part 291) 1 Arowolo v Ifabiyi (2002) 4 NWLR (Part 757) 356 Atta v Ezeanah (2000) 11 NWLR (Part 678) 363 f Ayeni v Dada (1978) 3 SC 35 Bolaji v Bamgbose (1986) 4 NWLR (Part 37) 632 Brollo Ltd v Nkwocha (1995) 9 NWLR (Part 419) 361 CCB (Nig) Ltd v Mbakwe (2002) 7 NWLR (Part 765) 158 g Cotecna Intl Ltd v Ivory Merchant Bank Ltd (2006) 9 NWLR (Part 985) 275; (2006) 6 MJSC 89 De Lluch v SBN Ltd (2003) 15 NWLR (Part 842) 1 h Ekwunife v Wayne (WA) Ltd (1989 5 NWLR (Part 122) 422 FATB Ltd v Partnership Investment Co Ltd (2003) 18 NWLR (Part 851) 35 Fawehimni v Akilu (1987) 4 NWLR (Part 67) 797 i FCDA v Naibi (1990) 3 NWLR (Part 138) 270 FMBN v NDIC (1999) 2 NWLR (Part 591) 333 George v Dominion Flour Mills Ltd (1963) 1 SCNLR 117; j (1963) 1 All NLR 71

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

376 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Idahosa v Oronsaye (1959) SCNLR 407; (1959) 4 FSC 166 a Ijebu Ode Local Government v Adedeji Balogun and Co Ltd (1991) 1 NWLR (Part 166) 136 Ikpeazu v ACB Ltd (1965) NMLR 374 b Imah v Okogbe (1993) 9 NWLR (Part 316) 159 IMNL v Pegofor Ind Ltd (2005) 15 NWLR (Part 947) 1 Integrated Timber and Plywood Products Ltd v UBN Plc c (2006) 12 NWLR (Part 995) 483; (2006) 5 SC (Part 11) 52 Jalico Ltd v Owoniboys Technical Service Ltd (1995) 4 NWLR (Part 391) 534 d Kano v Oyelakin (1993) 3 NWLR (Part 282) 399 Karibo v Grend (1992) 3 NWLR (Part 230) 426 Momoh v Olotu (1970) 1 All NLR 117 e Multi-purpose Ventures Ltd others v Administrator of Kwara State Lafiagi (1998) 7 NWLR (Part 557) 202 Multipurpose Ventures Ltd v Admin, Kwara State, Lafiaji (1998) 7 NWLR (Part 557) 202 f Multipurpose Ventures Ltd v A-G, Rivers State (1997) 9 NWLR (Part 522) 642 NV Scheep v M V “S Araz” (2000) 15 NWLR (Part 691) 662 g Nasaralai Ent Ltd v Arab Bank (Nig) Ltd (1986) 4 NWLR (Part 36) 409 Nasr v Berini (Beirut Riyad) (Nig) Bank Ltd (1968) 1 All NLR 274 h NDIC v FMBN (1997) 2 NWLR (Part 490) 735 NDIC v Okem Ent Ltd (2004) 10 NWLR (Part 880) 107 Ndiwe v Shingleton and Company Ltd (1993) 2 NWLR (Part i 274) 242 New Nigerian Bank Lid v Omovosa (1995) 9 NWLR (Part 419) 327 NGS Co Ltd v NPA (1990) 1 NWLR (Part 129) 741 j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

UBA Plc v BTL Industries Limited 377 a Obere v Board of Management, Eku Baptist Hospital (1978) 6 7 SC 15 Odubeko v Fowler (1993) 7 NWLR (Part 308) 637 b Ogbimi v Ololo (1993) 7 NWLR (Part 304) 128 Okoye v Nigerian Construction and Furniture Company Ltd (1991) 6 NWLR (Part 199) 501; (1991) 2 NSCC (Vol. 2) 422 c Okubule v Oyagbola (1990) 4 NWLR (Part 147) 723 Okunola v Oduola (1987) 4 NWLR (Part 64) 141 Oloriode v Oyebi (1984) 1 SCNLR 390 d Olowosago v Adebanjo (1988) 4 NWLR (Part 88) 275 Onwuchekwa v NDIC (2002) 5 NWLR (Part 760) 371 Owodunni v Regd Trustees CCC (2000) 10 NWLR (Part e 675) 315 Oyegoke v Iriguna (2002) 5 NWLR (Part 760) 417 Plateau Publishing Co v Adophy (1986) 4 NWLR (Part 34) 205 f Raimi v Akintoye (1986) 3 NWLR (Part 26) 97 Saraki v Kotoye (1992) 9 NWLR (Part 264) 156 Savannah Bank of (Nig) Ltd v Adegoke Motors (Unreported) g CA/L/ 399/96 State v Ilori (1983) 1 SCNLR 94 Swiss-Nigeria Wood v Bogo (1972) 1 NLR (Part 7) 433 h Tella v Usman (1997) 12 NWLR (Part 531) 168 Thomas v Olufosoye (1966) 1 NWLR (Part 18) 669 (SC) UBN Ltd v Odusote Bookstores Ltd (1995) 9 NWLR (Part 421) 558 i UBN Ltd v Penny Mart Ltd (1992) 5 NWLR (Part 240) 226 Umeojiako v Ezenamuo (1990) 1 NWLR (Part 126) 253 Foreign j WJ Allan and Co Ltd v El Nasr Export (1972) 2 QB 198

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

378 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian statutes referred to in the judgment a Admiralty Jurisdiction Act No. 59 of 1991, section l(i)(h) Constitution of the Federal Republic of Nigeria, 1979 (as b amended by Decree No. 107 of 1993), section 230(1)(d) Constitution of the Federal Republic of Nigeria, 1999, section 251(1)(d) Evidence Act Cap 112 Laws of Federation of Nigeria, 1990, c section 137(1) and 137(2) Federal High Court (Amendment) Decree No. 60 of 1991 Limitation Law Cap 118 Laws of Lagos State, 1994, d sections 8 and 58

Counsel For the appellant: Prof Kasunmu SAN (with him Agbakoba e SAN, Quakers, Okafor, Osadare, Opasanya, Odusanya and Adeoye) For the respondent: Chief Afe Babalola, SAN (with him Chief SA Awomolo, SAN, Adenipekun, SAN; Dr Onigbinde, f Oyewole, Alhaji Lasun Sanusi, Daramola, BJ Akomolafe, Osho (Mrs), Dada, Kolawole, Balogun (Miss), Aladesawe (Mrs), Ekpere (Miss), Oyamide g Judgment MUSDAPHER JSC: (Delivering the lead judgment) This is an appeal by the defendant against the judgment of the Court of Appeal, Lagos Division delivered on 22 July, 2003 in h which the aforesaid court confirmed the decision of the trial court. The claim of the plaintiff before the trial court as contained in paragraph 62 of the second further and better amended statement of claim is as follows– i “1. Declaration that the defendant was in breach of its duty to the plaintiff by its failure to remit to the overseas suppliers the purchase price (in foreign currency) of the goods supplied by its overseas suppliers for which payment was duly made by the plaintiff. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 379 a 2. An order directing the defendant to pay the sum of– (a) Pounds Sterling 3,632,872.93 (b) US Dollars 3,384,263.37 b (c) French Francs 3,478,031.85 (d) Deutsche Marks 3,431,790.47 (e) Belgian Francs 3,758,533.10 (f) Dutch Guilders 672,810.34 c (g) Danish Krone 79,515.00 to the plaintiff being the value of the goods ordered from overseas suppliers and received by the plaintiff and for which payment was made in Naira to the defendant at the material d time at the prevailing rate of exchange and which the defendant has failed to remit to the overseas suppliers despite repeated demands”. Alternatively to relief 2 above. e An order directing the defendant to pay to the plaintiff the Naira equivalent of the said sums of money at the prevailing rates for exchange at the time the defendant chooses to pay the plaintiff. f 3. The sum of N378,780,244.00 being anticipated profits from 1985 to 1994. 4. Loss of profit at the rate of N6,302,510.00 per annum from 1994 to date of judgment. g 5. Interest on judgment debt at the rate of 7.5% until payment is reflected by the defendant. Alternatively to 1 – 5 above. 6. A declaration that the defendant was in breach of its duty to h the plaintiff by its failure to duly inform the plaintiff in 1988 that the Central Bank of Nigeria had returned the sum of N8,541,557.66 which was to be remitted to the plaintiffs overseas suppliers. i 7. An order directing the defendant to pay to the plaintiff the sum of N8,544,577.66 returned by the Central Bank of Nigeria to the defendant with accrued interest to date. 8. An order directing the defendant to pay to the plaintiff the difference in exchange rates in 1988 and the prevailing rates j of exchange by the Central Bank of Nigeria at the time of

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 380 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

judgment or the prevailing rate of exchange as the defendant a chooses to pay the sum of– (a) Pounds Sterling 3,632,872.93 (b) US Dollars 3,384,263.37 b (c) French Francs 3,478,031.85 (d) Deutsche Marks 3,431,790.47 (e) Belgian Francs 3,758,533.10 (f) Dutch Guilder 672,810.34 c (g) Danish Krone 79,515.00 9. Interest on the said sum N8,544,557.66 at the prevailing rate of interest annually in 1988 when the Central Bank of Nigeria released the money to the defendant up to the time of judgment. d 10. The sum of N18,907.530.00 being anticipated profit from 1955 to 1987. 11. Interest at the rate of 7.5 from time of judgment to the time of payment by the defendant.” e Pleadings were ordered, filed, exchanged and amended. At the trial the plaintiff called 5 witnesses while the defendant called 7 witnesses. Five of them were called in Nigeria, while two of the defendant’s witnesses testified in London. f On 19/6/2002 learned counsel adopted their written addresses and in addition orally addressed the court. After an exhaustive treatment of the evidence, the learned trial Judge entered judgment in favour of the plaintiff thus:– g “Accordingly the plaintiff’s claims succeed. Prayers 1, 2, 3, 4 and 5 of the plaintiff’s second further and better amended statement of claim are granted with the following reductions. As regards prayer 3 it shall be sum of N300m. h As regards prayer 4 it shall be N5m per annum from 1994 to date of judgment. In the lights of the fact that the main claim succeeds the alternative claim is hereby refused. The judgment sum shall attract an interest at the prevailing interest rate fixed by the Central Bank of Nigeria i from 1987 until judgment and at 7% until the judgment paid.” Dissatisfied with the judgment, the defendant lodged an appeal on 11 grounds of appeal in the Court of Appeal. Distilled from the grounds the defendant raised six issues for j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 381 a the determination of the appeal. In its judgment delivered on 22 July, 2003, the Court of Appeal dismissed the defendant’s appeal. Still dissatisfied, the defendant has now b appealed to this Court and it was with the leave of this court that the defendant has filed the second amended notice of appeal on the 19/9/2006. The said second amended notice of appeal contains 11 grounds of appeal. Before the c examination of the grounds of appeal and the issues submitted for the determination of the appeal. it shall be necessary to briefly state the facts as found by the learned trial Judge as follows:– d “The plaintiff’s business is importation and distribution of building materials, industrial chemicals, and raw materials. These goods are imported from the plaintiff’s overseas suppliers namely– Meridian Trade Corporation: Meridian International Credit e Corporation and International Trade Meridian. Meridian Hamburg, Germany and Tata of India. The plaintiff has been banking with the defendant since 1980 and enjoys credit facility which it used to meet the costs of importation from its overseas suppliers. The f plaintiff imports items on credit from overseas suppliers and the items are usually sent with bills of exchange, or bills for collection or by letter of credit. Between 1981 and 1983 several of such bills and letters of credit, exhibits P1 to P330 were received by the defendant on behalf of the plaintiff. The price of each bill was g denoted in foreign currency, and the Total amount of Naira equivalent of the foreign currencies was N8,541,557.66 at the time the goods were ordered. The account of the plaintiff with the defendant was debited for the said amount. The defendant was expected to use the sum debited to secure Central Bank of Nigeria h allocation of foreign exchange. The plaintiff seeks by this suit a return of the money it paid to the defendant for remittance to the overseas exporters who had supplied the goods to the plaintiff. The plaintiff claims that the defendant negligently failed to secure i Central Bank of Nigeria allocation of foreign exchange despite persistent requests that the defendant should remit the money to the overseas supplier. At this stage it is very important that the situation in Nigeria as at 1983 with regards to importation of goods is explained, and what j is expected of an importer. P.W.2 Mr. Tola Lapite, a banking and

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 382 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

finance expert and consultant explained the situation in Nigeria at a the time. I adopt his explanation. He said and I quote him– ‘By the end of 1983 there was an accumulation or arrears of unpaid bills in form of bills for collection letters of credit and b direct remittance by Central Bank of Nigeria. This was due to non-availability of foreign exchange at the time’.” In 1984 the Federal Government of Nigeria struck an agreement with overseas creditors to refinance these unpaid c bills. They involved Chase Manhattan Bank, New York as the intermediary between Federal Government of Nigeria and the overseas creditor’s bank. Consequently Central Bank of Nigeria directed all banks to submit claims on d behalf of their customers to them for presentation to Chase Manhattan Bank. Simultaneously the overseas creditor’s bank submitted claims on behalf of the creditors to Chase Manhattan Bank who was expected to merge the claims submitted by both sides. This was in 1985. There was e preliminary report in 1985 sent by Central Bank of Nigeria to the banks to confirm the outstanding unpaid bills to Central Bank for verification by Central Bank of Nigeria. This report is called Debtors Summary Status Report, 1985 f (DSSR 1985). The banks were expected to inform the affected customers about the requirement from Central Bank of Nigeria and guide them to complying. g After the bank must have contacted the customer and collected information from them, they re-submitted the report to Central Bank of Nigeria. Central Bank will then verify the Report for onward submission to Chase Manhattan Bank, New York, USA. The final report started h coming out in 1987. After matching the claims of creditors (overseas) and Nigerian importers, the successful claims and the unsuccessful claims were reported to Central Bank and upon receipt of this report Central Bank Nigeria debited the i accounts of the banks and promissory notes were issued to the overseas creditors. The unsuccessful and rejected bills were also advised to the banks who in turn informed their respective customers of their bills. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 383 a If a bill is unsuccessful the money paid to the bank by the customer would be returned to Central Bank of Nigeria who returns it to the bank and then to the customer. b From the pleadings and evidence before the court, the following facts are not in dispute:– 1. The plaintiff/company was a customer of the defendant bank for a long time. See paragraphs 4, 5, c 6, 7 and 11 of statement of claim, admitted by paragraph 1 of the statement of defence. 2. The plaintiff was a valued customer of the bank and had a rosy time with the defendant bank between d 1980 to 1984. See defendants letter, exhibit “B” and evidence of DW1 and DW2. 3. The defendant received the bills for which payment e was duly made. See evidence of PW4, DW1 and DW3. 4. The unit of account was foreign currency as stated in paragraph 18 of the statement of claim. It is not f denied. See also evidence of PW4. 5. The total amount of Naira equivalent of the foreign currency was N8,541,557.60k. All relevant shipping and exchange control documents, all clearing g documents including bills of exchange and tax clearance certificate were submitted to the defendant in respect of each transaction to facilitate quick remittance of the value to the overseas suppliers. The h bills usually have maturity days of about 180 days. See exhibits P1, P330 evidence of PW4, DW1, DW2, DW5. 6. The plaintiff’s bills fell within the refinancing i scheme. It is trite law that what is admitted need not be proved. The defendant on its part pleaded that the Central Bank of Nigeria did not return or refund the sum of N8,541,557.66 to j the defendant in respect of the plaintiff’s transactions. The

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 384 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) plaintiff has no locus standi to bring the action. The a plaintiff’s action is caught by section 8 of the Limitation Law Cap. 118 Laws of Lagos State, 1994. That the defendant was not negligent in handling the plaintiff’s b transaction. DW1 – Mr. Ojukwu Chukwuemeka, a senior manager and Head of Foreign Trade Department with the defendant testified under cross-examination thus:– “I know from records that in 1988 Central Bank of Nigeria c returned all money in respect of unremitted bills back to Commercial Bank. The Commercial Bank is not expected to return it to the owner. The money should be kept in trust for the beneficiaries pending satisfaction of certain conditions. The condition for keeping money for unremitted bills is the d beneficiary’s bank should send the Nigeria Bank an authenticated telex message saying that the beneficiary is in agreement with any case of need in Nigeria to be credited with the money. This is because the importer having claimed and sold the goods has e received value for the supplier. That is why we are holding on to the money till today. According to the above testimony the Central Bank of Nigeria returned the plaintiff’s money to the defendant as far back as 1988. Till today the defendant holds on to the plaintiff’s money. This suit is for the return of the money.” f Now distilled from the aforesaid 11 grounds of appeal the defendant hereinafter referred to as appellant and the plaintiff the respondents formulated and submitted the following issues for the determination of the appeal:– g “(i) Whether in view of the pleadings of the respondent, the trial court has subject matter jurisdiction to adjudicate on the matter. (ii) In the event that it is held that the trial court had subject h matter jurisdiction, was the Court of Appeal right in confirming the decision of the trial court that the plaintiff’s action is not statute barred. (iii) If the respondent’s action is not statute barred, does the i respondent have the locus standi to prosecute this case? (iv) Was the Court of Appeal right in refusing to set aside the judgment of the trial court on the ground that the said judgment is not perverse? j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 385 a (v) Whether or not the respondent’s case should not have been dismissed by the lower courts having regard to the plea of the appellant and the evidence before court that the claim of the respondent runs contrary to Public Policy and Act of b State Doctrine. (vi) Should the award of damages and interest by the trial court and confirmed by the Court of Appeal be allowed to stand?” c In his brief for the respondent the learned Counsel has formulated and submitted similar issues. The appellant also filed the appellant’s reply brief. I shall in this judgment deal with the appeal by reference to the issues formulated by the appellant. d Issue 1 “Whether in view of the pleadings of the respondent the trial court has subject matter jurisdiction to adjudicate on this matter”. e Under this issue the appellant contends that the trial High Court has no jurisdiction to entertain the matter since the case is about the procurement of foreign exchange for f payment of goods imported into Nigeria by sea through the appellant by letters of credit with banking facilities. The documentary evidence clearly shows the intricate link with the Central Bank of Nigeria. It involves and concerns the revenue as well as the monetary and fiscal policy of the g Federal Government, thus the proper court is the Federal High Court which has the exclusive jurisdiction to entertain this kind of case. It is further argued that by section l(i)(h) of the Admiralty Jurisdiction Act the Federal High Court has h exclusive jurisdiction over “any banking or letter of credit transaction involving the importation of goods to Nigeria in a ship. Whether the importation is carried out or not and notwithstanding that the transaction is between a bank and i its customers”. It is again submitted that the action was instituted in 1994 and that by virtue of the decision in Adah v NYSC (2004) 13 NWLR (Part 891) 639; (2004) 7 SC (Part 11) 139, it is the law at the date that determines subject j matter jurisdiction.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 386 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The respondent on the other hand argued that the claim is a one simply found on breach of contract and for the return of the money paid to a bank by a customer due to total failure of consideration. It is submitted that the dispute herein is b based on a breach of contract and negligence and the Federal High Court does not have any exclusive jurisdiction. The mere fact that the unit of account is foreign currency does not make it a foreign exchange matter. The learned Counsel c referred to Oyegoke v Iriguna (2002) 5 NWLR (Part 760) 417 at 438; NDIC v FMBN (1997) 2 NWLR (Part 490) 735. See also CCB Ltd v Mbakwe (2002) 7 NWLR (Part 755) 163; De Lluch v SBN Ltd (2003) 5 NWLR (Part 842) 1 at 21. d I have carefully examined the claims of the respondent and I am unable to find on the pleadings or the evidence that the plaintiff as the respondent was making a claim predicated on the non-issuance or otherwise of letters of e credit or of failure or otherwise of goods shipped to Nigeria. In my view, this is a straight forward matter of a claim for negligence and for breach of contract and for the return of money. The claim has nothing to do with shipping, marine f commerce or marine navigation. In the CCB v Mbakwe case (supra) at page 179 it was held:– “Where a bank is engaged to transmit or remit money from a purchaser to an issuing bank without more, that singular act does not confer status of issuing bank on the remitting bank so as to g deprive the purchaser of the right to maintain an action against the remitting bank in the event of a default in remitting the agreed sum to the designated party.” As mentioned above the claim of the respondent before the h trial court does not in any way relate to fiscal for (sic) monetary policy of the government neither does it relate to the revenue of the government. It is a claim essentially founded on negligence and breach of contract. I am of the i view that the trial High Court has the necessary jurisdiction over the subject matter of the dispute. See NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107 at 222. I accordingly resolve issue No. 1 against the appellant. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 387 a Issue No. 2 This is concerned with the question whether the claim of the respondent is statute-barred. It is submitted that the lower b courts were in error to have held that section 8 of the Limitation Law of Lagos State does not apply to bar the respondent’s claims. They acted erroneously when they held the period commenced from when the contents of exhibit c “C” were brought to the attention of the respondent in 1994 even though exhibit “C” was written in 1988. It is submitted that reliefs 1 and 6, the two declaratory reliefs are caught up by the Limitation Law? Relief No. 1 is a complaint of d negligence/breach of contract on the part of the appellant for failing to remit the sums to the foreign suppliers. It is claimed that the right of action accrued six years after ie 1983-1989. It is submitted that the respondent could not file the action in 1994 because the duty to remit letter of credit e starts after 180 days after lodgment of funds. It is further submitted that the claim by the respondent that the appellant continued to make assurances and promises that the money would be transmitted or that the respondent was deceived f into believing so, is not sufficient. Learned Counsel referred to section 58 of Limitation Law of Lagos State and submits that only fraud or concealment of fraud will prevent the limitation period from running. It is again added that g allegation of fraud is to be proved beyond reasonable doubt. It is again argued that the respondent could have known of the existence of exhibit “C” with reasonable diligence. In any event no fraud was pleaded and none was proved. h For the respondent it is submitted that the appellant has failed to state how the respondent could have discovered exhibit “C” which was addressed by the CBN to the appellant. A customer of a bank should believe what the i bank has repeatedly told him. The respondent further added that he had specifically pleaded the assurances the appellant falsely continued to give him and that it was not until April, 1994, that the appellant became aware that the Central Bank j had returned the money to the appellant since 1988. It is

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 388 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) argued that apart from the general denial of paragraphs 44 a and 45 of the further and better statement of claim, the appellant did not controvert this in his statement of defence. Now, this issue has been raised and considered by the b lower courts. The trial Judge held at page 432 of the records:– “The fact that between 1983 to 1994 the chairman of the plaintiff PW4 was repeatedly assured by top officials of the defendant c bank to wit– Its Managing Director and Chief Executive Alhaji S. S. Baffa, Branch Managers, Mr. Adedeji and Mr. Oyebola that the money would be remitted to the overseas suppliers is established to my satisfaction. The defendant clearly does not dispute the above. If the plaintiff was constantly assured as d late as 1994 that his money would be remitted to the overseas supplier, then how may I ask can a cause of action arise in 1994 . . .”. The court also found the appellant did not cross-examine the e witness on this vital issue of concealment and deceit. I may add, that there was no appeal against such finding in the Court of Appeal. The Court of Appeal also found that there was concealment of crucial fact and deceit. The cause of f action only arose when the respondent accidentally stumbled on exhibit “C”. The trial court found that the totality of the appellant’s conduct in this case is fraudulent and concealment of fraud and the Court of Appeal affirmed this g finding. See Arowolo v Ifabiyi (2002) 4 NWLR (Part 757) 356. In the case of Jallco Ltd v Owoniboys Tech Services Ltd (1995) 4 NWLR (Part 391) 534 at 547, Mohammed, JSC stated:– h “In considering whether an action is statute barred, it is relevant to ask, ‘when does time begin to run? This court, in the case of Fadare and Others v Attorney General of Oyo State (1982) NSCC 52 at 60 referred to the case of Board of Trade v Cayzer Irvine and Co. Ltd (1927) AC 610 where it held– i ‘Time, therefore, begins to run when there is in existence a person who can sue and another who can be sued, and all facts have happened which are material to be proved to entitle the plaintiff to succeed’. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 389 a It is crystal clear from the facts of this case that the respondent had not become aware of the wrong entries in his accounts until in 1980/81. That being the case, the right of action accrued when the respondent’s demand to have his account credited was denied and b refused and this happened in 1980/81. The claim of the respondent is not therefore statute barred.” Similarly, in my view, the right of action in this matter clearly accrued in 1994 when the respondent became aware c of the existence of exhibit “C”. The respondent could not reasonably be expected to file an action against the appellant when the appellant was always giving him assurances that his bills and letters of credit were being processed by d Central Bank. Indeed there could be no cause of action. I accordingly resolve this issue No. 2 also against the appellant. e Issue No. 3 This is concerned with the question whether respondent has the locus standi to prosecute the claim. It is submitted that f the locus of the respondent to institute this action was challenged in paragraph 33 of the statement of defence. It is argued that by paragraph 19 of the further and better statement of claim, the respondent pleaded that the goods covered by bills in exhibits “P1” – “P331” had infact been g shipped to it and that the goods were collected by it. It is submitted that under the circumstances the respondent would have no cause of action and cannot maintain an action for the recovery of the money meant for the goods. The h money paid by the respondent becomes no longer his money but money held by the appellant for onward transfer to the overseas suppliers. Learned Counsel refers to the case of Akinsanya v UBA (1986) 4 NWLR (Part 35) 273; (1986) 2 i NSCC 980. Though in that case the Supreme Court was dealing with a confirmed letter of credit, in the instant case we are dealing with unconfirmed letters of credit. It is argued that in the case of UBN Ltd v Odusote Bookstores Ltd j (1995) 9 NWLR (Part 411) 558 although such an action was

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 390 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) allowed, the issue of locus standi was never raised and a argued. Learned Counsel also referred to unreported case of Savannah Bank v Adegoke Motors Suit No. CA/C/399/96 in which Ayoola, JCA as he then was, relied and quoted with b approval the dictum of Lord Denning in WJ Allan and Co Ltd v El-Nasr Export (1972) 2 QB 189 at 212. Learned Counsel has submitted that the Court of Appeal was in error to have confirmed the decision of the trial court on this c issue. Now, the trial court at pages 428–429 rejected the argument of the appellant on the issue of locus standi. He stated thus:– d “The plaintiff contracted the defendant to procure foreign exchange required to discharge its liabilities to foreign suppliers. The foreign suppliers shipped the goods to the plaintiff a long time ago, but the plaintiff has not paid for the goods till today. The liability of the plaintiff to the foreign suppliers remains. Having e failed to carry out the plaintiff’s instructions the only same (sic) thing to do is return the money to the plaintiff. The defendant says they are holding the money in trust [see evidence of D.W1]. The defendant has held on to the plaintiff’s money now for about 18 f years. See also exhibit V wherein the defendant informed the overseas suppliers that the failure to remit the money was because the plaintiff had not paid the naira cover when infact the plaintiff had paid the money to the defendant, a fact admitted by the defendant, but which he found convenient to deny to the overseas g suppliers. Holding unto (sic) the plaintiff’s money for 18 years is criminal. The defendant has no justification whatsoever ... See Savannah Bank v Adegoke Motors CA/C/399/96 Union Bank v Odusote (1995) 9 NWLR (Part 421) 558. The plaintiff is entitled to a return or a refund of his money to enable him pay his overseas h suppliers and restore his badly damaged name . . .” The Court of Appeal in my view, rightly confirmed the above finding of fact and that the respondent has clearly the locus standi to institute the action. In the case of CCB (Nig) i Ltd v Mbakwe (2002) 7 NWLR (Part 765) 158 at 163 it was held thus:– “On who can sue bank for failure to remit money abroad where a bank is engaged to transmit or remit money from a purchaser to an j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 391 a issuing bank without more, that singular act does not confer status of issuing bank on the remitting bank in the event of a default in remitting the agreed sum to the designated party.” b I am of the firm view, that the decision of Ayoola, JCA (as he then was) was correct in the SBN v Adegoke Motors Ltd (supra) when he opined:– “Also, as in this case where the application to the Central Bank c is by the buyer and such an application can only be processed by the banker, a collateral contract arises whereby the banker undertakes to process the application and the buyer undertakes to pay . . . contract as has been described emerged, the d aggrieved customer can sue and enforce that contract and claim damages where the banker has failed to exercise due care.” The complaint of the appellant under this issue is also not e made out. The respondent has the necessary locus standi. I resolve the issue against the appellant.

Issue No. 4 f This is essentially concerned with the finding of fact by the two lower courts. It is submitted that the Court of Appeal was in error to have refused to set aside the findings of facts g made by the trial Judge. It is argued that had the learned trial Judge properly evaluated and appraised the evidence, he would find for the appellant. The learned Counsel made a lengthy examination of the evidence and the numerous h exhibits tendered and submitted that the claims of the respondent were false. In my view, the matter before the trial court was very simple. The appellant as bankers agreed to process and i transmit to the overseas importers the value of the goods already shipped and collected by the respondent. The respondent paid the Naira equivalent of the foreign exchange involved. The appellant was negligent in j processing for the foreign exchange. At page 779 of the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 392 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) records of appeal, the Court of Appeal made the following a finding:– “The plaintiff contracted the defendant to procure a foreign exchange required to discharge its liability to the foreign suppliers. b The foreign suppliers shipped the goods to the plaintiff a long time ago, but the plaintiff has not paid for the goods till today. Having failed to carry out the plaintiff’s instructions the only same (sic) thing to do is return the money to the plaintiff. The defendant says they are holding the money in trust. See testimony of DW1. The c defendant has held on to the plaintiff’s money now for about 18 years. See also exhibit V wherein the defendant informs the overseas supplier that failure to remit the money was because the plaintiff had not paid the naira cover when infact the plaintiff had d paid the money to the defendant, a fact admitted by the defendant but which he found convenient to deny to the overseas suppliers the plaintiff is entitled to a return or refund of his money to enable him pay his overseas suppliers and restore his badly damaged name.” e It is clear to me that the Court of Appeal was right to confirm the decision of the trial court because the appellant has woefully failed to produce any evidence of promissory note used to pay the overseas supplier or that any of the 331 f bills was refinanced. At the oral hearing of this appeal when Counsel for the respondent submitted that none of the bills of respondent was refinanced in any of the documents referred to by the appellant, when asked, the appellant g Counsel was unable to show this Court where any of the bills was refinanced. These fundamental and crucial findings of facts were h concurrently made by the two lower courts and the appellant has failed to convince me that exceptional circumstances exist for me to disturb the findings. I have carefully considered the judgments of the two lower courts and their reasoning. I have also considered the argument of the i learned Counsel for both parties. I am convinced that the evidence before the trial court was properly appraised and evaluated. I have no reason to disturb the concurrent findings of facts made by the two lower courts. I am not j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 393 a persuaded that the findings are perverse. I accordingly resolve issue No. 4 against the appellant. b Issue No. 5 This is concerned with the question whether or not the respondent’s case should not have been dismissed by the lower courts having regard to the plea of the appellant that c the evidence before the court that the claim of the respondent runs contrary to public policy and act of state doctrine. The submission of the learned Counsel for the appellant is that this case is linked to the Federal d Government of obtaining debt relief and it is linked with the fundamental objective of the state. In reply, the learned Counsel for the respondent argued that this is a new special defence raised for the first time in the Supreme Court and that there was no pleading to support it. I agree with the e learned Counsel for the respondent that this is a special defence which is raised for the first time in the Supreme Court without leave. Further more there is no evidence whatsoever to support the argument. I find no merit f whatever in the argument of the appellant’s Counsel. I resolve the issue against the appellant.

Issue No. 6 g This is concerned with the award, assessment and quantum of damages. As mentioned above the courts below awarded the respondent sums in various foreign currencies being the value of the goods supplied by the exporters and which sums h were not transmitted to the exporters or the overseas suppliers. In this judgment, I have dealt at length with the issue of the liability of a banker under such a situation to refund to the customer. Accordingly, I do not need to go into i this again, suffice it to say that prayer No. 2 stands as granted by both the trial court and the Court of Appeal. The essence of the respondent’s claim which pervades the record and indeed is the whole basis of the action is the j failure of the appellant to transmit money to the overseas

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC 394 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) suppliers for goods already imported into Nigeria. If that a money was duly remitted to the suppliers, there would be no need for the case at all. The essence of damages in breach of contract cases is based on restitutio in integrum. That is the b award of damages in a case of breach of contract is to restore the plaintiff to a position as if the contract has been performed. In my view, since the respondent in this case has succeeded in his prayer No. 2, I do not think, it is proper to c grant prayers 3 and 4. These are losses of anticipated profits (i) from 1985 – 1994 and (ii) from 1994 to date of judgment. d The reason given was only because the foreign suppliers, having not been paid refused to deliver goods to the respondent on credit. The respondent was duty bound to mitigate its losses and look for money elsewhere to resume e trade with the usual suppliers or some other ones. I believe that the damages for loss of anticipated profits are too remote. The law imposes on a plaintiff in such a situation the duty to take reasonable steps to mitigate the loss consequent on the breach and debars him from claiming for f any remote damage which is due to his neglect or refusal to take other steps. The time factor is also very important. A plaintiff must as soon as he discovers that the defendant has breached his contractual obligation, he should immediately g begin to mitigate the losses. In the instant case even if there is no remoteness of the damage, the respondent became aware of the breach when the suppliers were continuously demanding for payment. The respondent clearly could not h just sit down after knowing the situation on the ground, it is duty bound to avoid the loss of expected profits by redeploying its resources elsewhere. In any event since the money to be remitted to the foreign i suppliers was not meant to be employed in their business, the failure to remit the money cannot affect and has no hearing (sic) on the refusal of the suppliers to sell goods on credit to the respondents. Indeed the respondents could deal j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Musdapher JSC UBA Plc v BTL Industries Limited 395 a with other suppliers if they so wished. I am accordingly of the view, that items 3 and 4 cannot be recovered against the appellants. b I accordingly set aside the award of N300 million as damages for loss of anticipated profits from 1985 to 1994 and the sum of N5 million Naira per annum also as loss of anticipated profits from 1994 till date of judgment. Subject c to the above, the appeal fails and is dismissed by me. I award the respondent N10,000.

BELGORE CJN: I have read the judgment of Musdapher, JSC and I agree with his reasoning and conclusion. It is the d duty of the plaintiff/respondent to mitigate its loss. The sum of N378,780,244 being anticipated loss in alternative claim numbered 3 must not have been awarded; similarly item 4 for “loss of profit” for N6,302,510. Otherwise the appeal is e dismissed as the concurrent findings of the two courts below cannot be assailed on the totality of the evidence on the record. As the lead judgment is replete with all the facts and f issues I hereby adopt them as mine, and I dismiss this appeal as unmeritorious.

ONU JSC: Having been privileged to read before now the g judgment of my learned brother Dahiru Musdapher, JSC just delivered, I agree with his conclusion that the appeal fails and it is dismissed by me. As the facts of the case as well as its historical h background are clear and indisputable as comprehensively set out in the judgment of my learned brother to need any further review. I intend here to go straight into the consideration of the six issues identified by the appellants i for our consideration; they incidentally overlap those proffered in their own second amended brief of the respondent, thus:– (i) Whether in view of the pleadings of the respondent, j the trial court has subject matter jurisdiction to

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 396 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

adjudicate on the matter. (Ground 1 of the second a amended notice of appeal.) (ii) In the event that it is held that the trial court had subject matter jurisdiction, was the Court of Appeal b right in confirming the decision of the trial court that the plaintiff’s action is not statute-barred? (Ground 3 of the second amended notice of appeal.) (iii) If the respondent’s action is not statute-barred, does c the respondent have the locus standi to prosecute this case? (Ground 2 of the second amended notice of appeal.) (iv) Was the Court of Appeal right in refusing to set d aside the judgment of the trial court on the ground that the said judgment is not perverse? (Grounds 4, 5, 6, 7 and 8 of the second amended notice of appeal.) e (iv) Whether or not the respondent’s case should not have been dismissed by the lower court having regard to the plea of the appellant and the evidence before the court that the claim of the respondent runs f contrary to public policy and act of state doctrine. (Ground 9 of the second amended notice of appeal.) (vi) Should the award of damages and interest by the trial court and confirmed by the Court of Appeal be g allowed to stand? (Grounds 10 and 11 of the second amended notice of appeal.) I would now wish to consider the issues serially and the rejoinder in the amended appellants reply brief as follows:– h

Issue 1 Issue No. 1 asks whether or not the Lagos High Court has jurisdiction over the respondent’s case which was a case of i simple contract. The appellant treated this issue as issue 1 in its brief of argument at page 13. The appellant then proceeded to treat the issue in 37 lines only vide pages 13 to 15 without citing a j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 397 a single case in support thereof that the High Court lacks jurisdiction to entertain the suit. Contrary to the appellant’s submission, the claim is one founded on breach of contract b and for return of money paid to its bank by its customer due to failure of consideration. I have no hesitation in upholding the findings of the two lower courts that from the pleadings and evidence the transaction is between a bank and a c customer and not as cynically put by the appellant:– “a banking or letter of credit transaction involving importation of goods into Nigeria in a ship, whether the importation is carried out or not and notwithstanding that the transaction is between a bank and its customer.” d Indeed, it is trite that jurisdiction is determined by the plaintiff’s claim before the court. See Akinsanya v UBA Ltd (1986) 4 NWLR (Part 35) 273; Multipurpose Ventures Ltd and others v A-G, Rivers State (1997) 9 NWLR (Part 522) e 642 at 662; Multi-purpose Ventures Ltd others v Administrator of Kwara State Lafiagi (1998) 7 NWLR (Part 557) 202 at 212; Okoye and others v Nigerian Construction and Furniture Company Ltd (1991) 6 NWLR (Part 199) f 501; (1991) 2 NSCC (Vol. 2) 422 at 436 where Akpata, JSC pointedly laid down the position of the law to be:– “The legal position as to competence or otherwise of the trial court to entertain case is arrived solely on the facts disclosed in the g statement of claim.”. See also Aladegbemi v Fasanmade (1988) 3 NWLR (Part 81) 129. This rather ingenious though untenable submission cleverly ignores the law that any issue of jurisdiction is h founded on the plaintiff’s statement of claim alone, not the defendant’s defence or any other process. See N V Scheep v M V “S Araz” (2000) 15 NWLR (Part 691) 662 at 668H. Be it noted that nowhere is it stated that the respondent is i making a claim predicated on non-issuance or otherwise of letters of credit or of failure or otherwise of goods shipped into Nigeria. It is apparent that the appellant is labouring under a misconception of the purport and application of j section 1(1)(h) of the Admiralty Jurisdiction Act vis-à-vis

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 398 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) the issues in this case. In effect, the respondent is neither a complaining here about shipping nor non-shipping of goods by sea. Hence, I agree with the respondent’s submission that the appellant’s submission is thoroughly misconceived and b of no moment. It is consequently not surprising that the appellant raised this issue in a few paragraphs of the pleadings, citing the statute without attempting to refer to the paragraphs of the pleadings or evidence of witnesses that c support its contention because clearly there is none. As the claim has nothing to do with monetary or fiscal policy of the Federal Government of Nigeria in the pleadings and evidence before the court, the mere fact that d the unit of account is foreign currency for which the respondent paid the Naira equivalent does not make it a foreign exchange matter. See Oyegoke v Iriguna (2002) 5 NWLR (Part 760) 417 at 438 paragraphs F–G, H where the e court held as follows:– “. . . the subject matter in dispute i.e. exchange of foreign currency can at best be a subject matter of concurrent jurisdiction between the Federal High Court and a State High Court. I hold that the trial court had jurisdiction to determine the issue of exchange of f foreign currencies.” Also in NDIC v FMBN (1997) 2 NWLR (Part 490) 735 at 755–756 paragraphs H–A. g It was held that dispute between an individual customer and his bank in respect of transactions between them can hardly affect the vital interest of the Federal Government, the provision in section 230(d) relates in that regard to the exclusive jurisdiction given to the Federal High Court:– h “Section 230(1) of Decree No. 107 of 1993 must first be viewed from its import as I earlier pointed out namely, to give exclusive jurisdiction to the Federal High Court over causes affecting the vital interests of the Federal Government as regards revenue, fiscal i measures, financial institutions, such as banks, the running of the Federal Government and its agencies and all matters within its exclusive list. A dispute between an individual customer and his bank in respect of transactions between them can hardly affect the vital interests of the Federal government. So the provision in j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 399 a Section 230(1)(d) relates in that regard to the exclusive jurisdiction given to the Federal High Court.” See CCB (Nig) Ltd v Mbakwe (2002) 7 NWLR (Part 765) b 158 at 163 where the Court held as follows:– “On who can sue bank for failure to remit money abroad. Where a bank is engaged to transmit or remit money from a purchaser to an issuing bank without more, that singular act does not confer status c of issuing bank on the remitting bank so as to deprive the purchaser of the right to maintain an action against the remitting bank in the event of a default in remitting the agreed sum to the designated party. (Page 179 Paragraghs A – B).” In the same vein, the Court of Appeal in the case of De d Lluch v SBN Ltd (2003) 15 NWLR (Part 842) 1 at 21C, held that it is only when a claim is in respect of fiscal measure or relate to the revenue of the Federal Government that section 251 of 1999 Constitution applies:– e “It is clear from the above provision that the Federal High Court has only exclusive jurisdiction over matters enumerated in Section 251(1)(d) of the 1999 Constitution where such relate to fiscal measures or the revenue of the Federal Government. f The appellant’s claim before the High Court of Lagos State does not in any way relate to any fiscal measure of the Federal Government neither does it relate to the revenue of the Federal Government. It is a claim founded on the negligence of the respondent bank. Clearly, the High Court of Lagos State has g jurisdiction to entertain the suit. I agree with the learned counsel for the appellant’s submission that even though Decree No. 107 of 1993 and the 1999 Constitution enlarged the exclusive jurisdiction of the Federal High Court and reduced the hitherto unlimited h jurisdiction of the High Court of Lagos State provided by Section 236(1) of 1979 Constitution, the High Court of Lagos State still has jurisdiction to entertain any claims connected with bank and banking except such claims were connected with fiscal measures or revenue of the Federal Government of Nigeria”. See SBN v De i Lluch (supra). As this is a claim of breach of contract by a customer against its bank, the Lagos State High Court has, in my firm view, jurisdiction to entertain the claim. Furthermore, as the j appellant for its contention sought support by reliance on the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 400 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Admiralty Jurisdiction Decree, I see no merit therein. For as a the Supreme Court held in NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107 at 222:– “In effect, the proviso in Section 251(1)(d) is to limit the b operationality of the foregoing prescription to show that applicability is not general but it does not destroy or divest the Federal High Court of this power. It should therefore be understood to mean that the Federal High Court enjoys equal power with the State High Court in banking cases involving bank c and customer.” Issue No. 2 asks:– “Whether a claim by a customer of a bank for the return of the d money due to failure of consideration runs contrary to public policy and act of state doctrine.” (Issue 5 in the appellant’s brief.) In the treatment of this issue which was considered in 40 lines, the three cases cited have no relevance to the case in e hand. The appellant contended that this is linked to Federal Government’s efforts at obtaining debt relief for the country and that the matter is act of the state involving fundamental objectives of the state. It is also argued that if the appeal succeed (sic) many others will approach the court and that f this will affect the financial programme of the state. As this is a special defence which the appellant was raising for the first time in this Court we were urged to strike out this issue on grounds of incompetence, it being settled law that special g defences must be specifically pleaded. (2) Kano v Oyelakin (1993) 3 NWLR (Part 282) 399 at 404 paragraphs D–F which states as follows:– “A defence which is a special defence and is available to the h defendant at the time of the action must be pleaded specifically– where it is not pleaded, it could not be raised even on appeal.” (3) Akintola v Balogun (2002) 1 NWLR (Part 642) at page 532 particularly at page 551, paragraphs D – E i which states thus:– “A special defence ought to be specifically pleaded. In the instant case, the grant of licence can be taken as a special defence which ought to be specifically pleaded.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 401 a (4) Atta v. Ezeanah (2000) 11 NWLR (Part 678) 363 at 383 paragraphs B – D; (5) FCDA v Naibi (1990) 3 NWLR (Part 138) 270 at b page 281 paragraph F. (6) Thus, it was held by the Supreme Court in Nasr v Berini (Beirut Riyad) (Nig) Bank Ltd (1968) 1 All NLR 274 at 295 per Coker, JSC:– c “. . . but where illegality does not appear ex facie the court is not entitled to speculate upon its incidence let alone expressly pronounce upon it unless it was made a part of the case of either side.” d (7) In the case of Ndiwe v Shingleton and Company (1993) 2 NWLR (Part 274) 242 which is not dissimilar to the instant appeal, the court at page 250 said:– e “Looking closely at the plaintiff’s statement of claim there is nothing therein that even remotely raised any issue of illegality. It was a simple case of an overseas exporter selling goods to a Nigerian importer under a, c f and f contract which was to be paid for by a bill of exchange. Certainly, it is not illegal to pay for a transaction through a bill of exchange drawn by an exporter in England accepted by an importer in Nigeria.” g (8) IMNL v Pegofor Ind Ltd (2005) 15 NWLR (Part 947) 1. (9) AIC Ltd v NNPC (2005) 11 NWLR (Part 937) 536; (2005) 5 SC (Part 11) 60 at pages 66–68 where this h Court held that where a party raising the defence of illegality has not raised it in its pleadings by stating the facts on which it relies the appellate court will be disabled from considering the issue of illegality. In i the earlier decision in the case of Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) at 422 page 436 this Court held as follows:– “where a contract is not ex-facie illegal and the question j of illegality depends on a number of facts, probabilities

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 402 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

or possibilities or contingencies to be hammered out by a evidence and forensic logic, the general rule is that illegality must be raised in the pleadings”. Apart from not pleading act of state doctrine or public policy b neither is any evidence led on or even address made on them before the two lower courts. Since there has not been any pronouncement on any of the issues, any appeal on them cannot be competent, as appeal must be against the decision c of the lower court. See Saraki v Kotoye (1992) 9 NWLR (Part 264) 156 at 184; New Nigerian Bank Ltd v Oniovosa (1995) 9 NWLR (Part 419) 327, 334F; Tella v Usman (1997) 12 NWLR (Part 531) 168, 173F. d Moreover, there is no evidence or material to support any of the allegations which means that even if leave was sought it must be granted. Since the issues are not part of the pleadings the argument e proffered on it at best, goes to no issue and should be struck out. See George v Dominion Flour Mills Ltd (1963) 1 All NLR 71; (1963) 1 SCNLR 117. In that wise I agree with the f respondent that since there has been no pronouncement on them at the lower court for them to be the subject of an appeal, they are therefore incompetent. See Saraki v Kotoye (supra). Thus, I agree with learned Senior Advocate for the g respondent when he submitted that contrary to the argument of the appellant no state will take delight in unnecessarily exposing its citizens to economic ruin or strangulation, arguing that the essence of refinancing is to assist the h economy and the image of both the nation and her citizens. Further, that there is nothing in refinancing exercise which encourages evasion of international obligation. The aim it is contended, is to enhance settlement of outstanding imports, adding that all the imports are claimed through the i legitimate Central Bank of Nigeria (CBN) regulations since they all ought to be matched but for the negligence, dishonesty or deceit of the appellant. The misconception of the appellant in imputing public policy or act of state to j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 403 a defeat legitimate transaction being what this Court has deprecated in the case of Onwuchekwa v NDIC (2002) 5 NWLR (Part 760) 371 at 392. b Issue 3 This issue (grounds 2 and 3) which overlap appellant’s issues 2 and 3 and argued as issues 2 and 3 in second c amended appellant’s brief, urges us to dismiss appellant’s argument on these issues and confirm the concurrent judgments of the two lower courts and resolved against the appellant as concurrent findings which require special d circumstances by the appellant to succeed. In my opinion there is nothing new which the appellant has urged on us which will alter the judgment of the lower courts.

Limitation e The appellant’s contention in this respect was that under this issue that the respondent ought to have discovered the existence of exhibit “C” and that it was wrong for the trial court to hold that the cause of action would not arise until f the respondent became aware of the exhibit. Appellant did not state how and where it would have discovered exhibit “C” which was addressed to the appellant by CBN. The respondent was not a staff of CBN or UBA. g As a customer ought and should believe what the bank told him, the submission, to say the least, is erroneous. It is therefore too late in the day, it was further argued, for the appellant to raise this defence before us in this Court having h not controverted the averment of the respondent at the trial court to the effect that it did not become aware of exhibit “C” until 1994. The pleading in this regard is contained in paragraphs 44 i and 45 of the second further and better amended statement of claim at page 135 which is as follows:– “44. Due to persistent demands from overseas suppliers, for payment for the goods supplied to the plaintiff, the plaintiff j continued to put pressure on the defendant through letters

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 404 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

and personal visit of the plaintiff’s Chairman to have the a defendant remit the money to the overseas suppliers. The defendant falsely continued to assure the plaintiff that the money was still with the CBN and will be remitted. b 45. The plaintiff avers that it was not until April, 1994 that it saw CBN circular Ref. No. FOD/CFOF/ 08.N.B/Vol. 1/28 dated 24/11/88 which circular confirmed that the defendant had indeed received the money from the CBN as far back as 1988”. (Italics above are mine for emphasis.) c Apart from the general denial, the appellant did not offer any single word on this material issue in the statement of defence. I am therefore of the view that appellant’s argument with regard to its knowledge of exhibit “C” goes d to no issue, having raised the same issue in both High Court and the Court of Appeal. The court, it was also held, found that the plaintiff did not cross-examine the witness or witnesses on this vital issue of e concealment. There was also no appeal against the findings and the Court of Appeal confirming the findings by the High Court, held that there was concealment of crucial facts as well as deceit; the issue, not being knowledge of any adverse f possession but as to whether or not any cause of action accrued to the respondent before the discovery of exhibit “C”. As Nnaemeka-Agu, JSC put it in A-G, Kwara State v Olawale (1993) 1 NWLR (Part 272) 645, 663:– g “I think I should begin my consideration of this important issue in this appeal by asking myself the question: What is a cause of action? I would be content in this respect to adopt the definition of the expression by Diplock, LJ in Letang v Cooper (1965) 1 QB 232, where he defined it as– h ‘. . . simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person’. the words comprise every fact (though not every piece of i evidence) which it would be necessary for the plaintiff to prove, if traversed, to support his right to the judgment of the court.” See also Ogbimi v Ololo (1993) 7 NWLR (Part 304) 128, 136 (per Karibi-Whyte, JSC and Odubeko v Fowler (1993) 7 j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 405 a NWLR (Part 308) 637 at 645 and Ajayi v Military Administrator Ondo State (1997) 5 NWLR (Part 504) 237 at 243. b I agree, with learned Senior Advocate for the respondent’s submission that contrary to appellant’s contention, knowledge of adverse possession is totally irrelevant and inapplicable, adding that lack of knowledge referred to by c the respondent in its testimony in court, is not lack of knowledge of an adverse possession but rather that it is lack of knowledge of facts that gives it a right of action in a situation where the knowledge is essentially or wholly d within the preserve of the appellant and who has hidden it from the respondent. It is different, it is further contended, from lack of knowledge of adverse possession of land in a land claim where adverse possession of land is a common knowledge, adding that what it means in the circumstances, e is absence of any fact that can support any cause of action by the respondent. In the alternative, the respondent further submitted, that f the appellant falsely assured it (respondent) that its bills have been processed and that its foreign suppliers would soon be paid, when the truth is that the appellant kept the respondent’s money and was using the money to trade. On the other hand, appellant was said to have told the g respondent’s overseas suppliers that the respondent had failed to pay the Naira equivalent of the value of the bills. The trial court having been shown to have found that the totality of appellant’s conduct in the case is fraudulent and h criminal the finding, the Court of Appeal affirmed a submission, learned Senior Advocate for the respondent submitted, is clearly erroneous since in order to ascertain a plea of fraud, the plaintiff needed not use the word “fraud” i specifically (sic). It would suffice, it is contended, if allegations are made that the defendant made representation to the plaintiff upon which he intended the plaintiff to act, which representation was untrue and known to the defendant j to be untrue. To buttress the submission, the case of

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 406 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Okunola v Oduola (1987) 4 NWLR (Part 64) 141, was a founded upon, adding that the respondent’s pleadings in paragraphs 22, 35, 38, 43, 44 and 45 in the second further and better amended statement of claim, satisfied this b requirement. Accordingly, the respondent’s case falls squarely outside the contention of the appellant and thus falls within the exception created under the authority of Akibu v Azeez c (2003) 5 NWLR (Part 814) 643; (2003) FWLR (Part 149) 1490, 1511 where this Honourable Court held as follows:– “Apart from fraudulent concealment of right of action which itself furnishes a cause of action, knowledge cannot be said to be d relevant. In order to constitute such fraudulent concealment as would, in equity, take a case out of the law of limitation, it is not enough that there should be merely tortuous act unknown to the injured party or the enjoyment of property without title while the rightful owner is ignorant of his right there has to be some abuse e of a confidential position some intention at imposition, or some deliberate concealment of facts.” (Italics supplied.) See also the case of Arowolo v Ifabiyi (2002) 4 NWLR (Part 757) 356, 378, a case decided by this Court and whose facts f are similar to the ones now being considered. There, the plaintiffs instituted an action in 1987 against the defendant for declaration and return of its title deeds and tax receipts surrendered to the first defendant for a loan taken in 1978. g The plaintiff, now respondent, as stated was said to have paid back the loan in 1979 as agreed and demanded for the return of his documents. The first defendant, it was maintained, endlessly made promises that he would return h the documents. This continued from 1979 until 1987 when the first defendant confessed for the first time to the plaintiff that he had used the documents to raise a loan from the second defendant bank. The first plaintiff then commenced the action in 1987 where up till now, the first defendant/ i appellant raised the defence of statute of limitations while the High Court agreed with the plaintiff and held that the first defendant cannot take advantage of his dubious conduct and that the respondent cannot be expected to embark on a j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 407 a cause unknown to him. The High Court agreed and held that the respondent cannot be expected to institute on a cause unknown to him. The Court of Appeal agreed and held that b there was no reason to fault the judgments of the two courts below. See also the views of Iguh, JSC in Jallco Ltd v Owoniboys Technical Service Ltd (1995) 4 NWLR (Part 391) 534 at 547 where Mohammed, JSC held thus:– c “In considering whether an action is statute barred, it is relevant to ask, ‘when does time begin to run’? This court, in the case of Fadare and Ors. v Attorney General, Oyo State (1982) NSCC 52 at 60 referred to the case of Board of Trade v Cayzer, Irvine Land Co. Ltd (1927) A.C. 610 where it held that– d ‘Time, therefore, begins to run when there is in existence a person who can sue and another who can be sued, and all facts have happened which are material to be proved to entitle the plaintiff to succeed’. e It is crystal clear from the facts of this case and that the respondent had not become aware of the wrong entries in his accounts until in 1980/81. That being the case, the right of action accrued when the respondent’s demand to have his account credited was denied and refused, and this happened in 1980/81. The claim of the f respondent is not therefore statute barred.” Thus, it must be emphasised, that the plaintiff would not reasonably file any suit against the defendant bank as long as it was assuring the plaintiff that its bills were being g processed by the Central Bank. Indeed, there would be no cause of action as at that time.

Locus standi h Locus standi denotes legal capacity to institute proceedings in a court of law. It is used interchangeably with terms like standi and title to sue. Thomas v Olufosoye (1986) 1 NWLR (Part 18) 669 at 685 (SC); Fawehinmi v Akilu (1987) 4 i NWLR (Part 67) 797 and Bolaji v Bamgbose (1986) 4 NWLR (Part 37) 632 at 646: Adesanya v President of Nigeria (1981) 2 NCLR 358; State v Ilori and others. (1983) 1 SCNLR 94 at 111 and A-G, Kaduna v Hassan (1985) 2 j NWLR (Part 8) 483.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 408 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

The appellant in arguing this issue urged this Court to a overrule the case of Savannah Bank of (Nig) Ltd v Adegoke Motors CA/L/ 399/96. It is necessary, firstly to point out that Adegoke Motors’ case followed the decision in b Akinsanya v UBA Ltd (1986) 4 NWLR (Part 35) 273; (1986) 2 NSCC 980 where, as admitted by the appellant, the Supreme Court decided a similar case. Adegoke Motors’ case also followed the decision of this Court in the case of c Union Bank v Odusote (1995) 9 NWLR (Part 421) 558. Where Ayoola, JCA (as he then was) who read the leading judgment relied on a number of cases including Lord Denning’s decision in WJ Allan and Co v EL Nasr Export (1972) 2 QB 189 at 212. d Obviously, the invitation of the appellant that this Court should overrule Adegoke’s case is also an invitation that this Court should overrule all the Supreme Court cases which e Adegoke’s case relied on. That will be most inappropriate. The appellant raised the issue of locus standi in the two courts below. The two courts resolved the issue against the appellant. f Earlier on, DW5 had said under cross-examination:– “Central Bank of Nigeria returned money to the commercial bank for onward transmission to the importers for bill that did not match.” g How then can DW1 who testified for appellant say that the plaintiff’s money was returned to it by Central Bank of Nigeria that held it in trust, adding (see the evidence of DW1):– h “I can’t remember how many accounts we had during the financing exercise. When money is transferred from deposit account to current account, we are at liberty to use it. When Central Bank of Nigeria decided to return it in 1988 we used i it. Exhibits HH1 – HH10. Exhibit C is instructive. The plaintiff’s money was never held in trust rather as learned senior counsel put it, it was held in fraud. The plaintiff is very much entitled to have his money returned to him immediately by the defendant.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 409 a The Court of Appeal at pages 780–781 of the record confirmed the judgment of the High Court and concluded as follows:– b “Applying the above, the learned trial Judge from the facts established whether appellant had justification to hold on tightly to respondent’s money for 18 years whether rightly raised a justiciable issue and also a dispute between the parties. Respondent in my view passed the two acid tests and the learned c trial Judge was right to have granted the locus standi to the respondent from pleaded facts in the statement of claim therefore I endorse and confirm that respondent having passed the two acid tests of locus standi the learned trial Judge rightly granted the d locus standi to the respondent. Issue 2 in appellants’ issues (sic) argument is resolved in favour of respondent. On the issue of the locus standi of respondent’s attack on the judgment of the learned trial Judge that granted e the locus standi to the respondent lacks substance and unmeritorious with the consequential submission of dismissal of appellant’s issue 2 that respondent lacked the locus standi.” f For this submission by the learned Senior Advocate for the respondent for there being no appeal against the findings of fact made by the High Court and confirmed by the Court of Appeal there is, in my view, no basis for disturbing the g judgment of the lower court. Thus, I uphold his submission that he cannot improve on the judgment of Ayoola, JCA (as he then was) in the case of Savannah Bank of (Nig) Ltd v Adegoke Motors Ltd (Unreported) CA/1/339/96, wherein h His Lordship stated the position with respect to liability in international commercial transactions which this case is, as follows:– “Also as in this case, where the application to the Central Bank of i Nigeria is by the buyer and such application can only be processed by the banker, a collateral contract arises whereby the banker is in fund for the purpose of allocation where such collateral contracts as have been described have emerged, the aggrieved customer can sue to enforce that contract and to claim damages where the j banker had failed to exercise due care.”

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 410 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Learned Senior Advocate then submitted that contrary to the a claim of the appellant, the facts have been established in this case namely:– “(i) That the respondent’s overseas suppliers have not been paid b till now. (ii) That the overseas suppliers have not ceded their right to be paid to ECGD or anybody at all. (iii) That the liquidators of the overseas suppliers do not know c the appellant at all and are not looking unto it for anything. (iv) That the overseas suppliers have black listed the respondent for its failure to pay for the goods it imported from these exporters. d (v) That the money paid by the respondent is still being kept by the appellant. The appellant’s witness said they are keeping it in trust for the overseas suppliers who are however not looking unto the appellant and who in fact do not know the appellant and do not have the appellant in view. e (vi) That the respondent is in dire need of mending its battered image before the overseas suppliers. (vii) That ECGD is merely a quasi insurance institution who reserves the right to proceed against the respondent if and f whenever it pays any money to the respondent’s suppliers arising from the failure of the respondent to meet its obligations to the assured.” The contention of the appellant that since the respondent had g collected the goods it had no right to complain is a clear manifestation of lack of understanding of the case of the respondent as well as the rights and obligations of parties to the business of foreign transactions. It is undisputable that h payment made to the appellant by the respondent was for remittance to foreign suppliers. Such that if no remittance was made for benefit of the suppliers no one else can complain but the respondent that paid the money. What the position comes to is the fact that the suppliers remain i strangers to the contract for remittance with no power to enforce it or claim refund vide Ikpeazu v ACB (1965) NMLR 374, 379. See also Alfotrin v A-G, Federation (1996) 9 NWLR (Part 475) 634 at 655 and Brollo Ltd v Nkwocha j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 411 a (1995) 9 NWLR (Part 419) 361 at 368. Be it noted that essentially, importation is mostly through bill of exchange by which payments will be made many days after collection b of goods. The appellant’s contention that respondent lacks locus depicts total misconception of the nature of importation business or conduct. c This is because it is trite that international commercial transactions invariably involve four autonomous though interconnected contracts as spelt out in the case of Nasaralai Enterprise Ltd v Arab Bank (Nig) Ltd (1986) 4 NWLR (Part d 36) 409. In the case in hand, those four contracts were as follows:– “1. The first contract is the underlying contract of sale between the Nigerian Buyer Nasaralai Enterprises Ltd and a foreign e seller, the World Grain Company Ltd of Thailand. Under this contract the Thai Company the vendor was to sell to the Nigerian Company Vendee 100,000 bags of Thailand long grain parboiled rice. The Nigerian company cannot pay with Nigerian currency hence the need for the second f conduct. 2. The second contract was between the Nigerian buyer the plaintiff/company and his bank the defendant. Under this contract, the Nigerian buyer instructs his bank to open a g letter of credit in favour of the World Grain Company Limited of Thailand. Under this second contract, the Nigerian bank the defendant was under a contractual obligation to issue the credit in strict conformity and compliance with all the instructions of the plaintiff and the h prevailing law in that regard. Here it is part of the plaintiff’s case that the defendant was in breach of the obligations imposed on it by mandate and stipulation of the plaintiff and the existing law when the defendant failed to endorse i on the credit the requirements of the Merchant Shipping (Amendment) Decree No. 9 of 1978 sections thereof. 3. The third contract was between the defendant bank now the issuing bank and a foreign bank where the seller or vendor resides in the case of Bank of Tokyo, Thailand. This said j bank is the confirming bank. Under this third contract, the

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 412 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Nigerian bank, the defendant in this case, undertakes to a reimburse the Bank of Tokyo, Thailand for all payments it made to the vendor. Grain Company on presentation by the World Grain b Company documents which ex facie conform with the terms and condition of the credit (sic). The plaintiff’s case here is that the Bank of Thailand was grossly negligent in failing to deduct obvious inconsistencies and contradictions apparent on the face of the documents presented to it. It is also the c plaintiff’s case that the defendant was negligent in not detecting the irregularities on the documents and in not stopping payment. 4. The fourth contract was between the Bank of Tokyo, d Thailand and the World Grain Company Limited of Thailand. Under this contract the Bank of Tokyo Thailand undertook to pay World Grain Company Limited of Thailand the amount on the credit against presentation of stipulated documents”. e See also the case of Savannah Bank of Nig. Ltd v Adegoke Motors (supra), the locus classicus on the point. In the instant case, the contract for remittance of money, f to foreign suppliers of the respondent dovetails into the second category of contracts in international commercial transactions set out herein before. Hence, the appellant’s contention, that the respondent lacks locus standi to sue for g non-remittance of the money to her suppliers and its refund cannot be anything than a serious misconception. Besides, the submission also provides the answers to the question of what constitutes cause of action raised and argued by the appellant. This is more so since it is trite that the currency of h the home country of the respective supplier is the unit of account for settlement of the respective imports of the suppliers. And since the Naira fluctuates to almost all international currencies, it becomes the duty of the appellant i who caused the defaulting effecting the remittance to provide to take care of the value of all affected imports. See this court’s findings in Odusote v FBN Ltd (supra). See also Wood House v Nigeria Produce (supra). j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 413 a The allegation of want of locus standi or cause of action in my view, is therefore erroneous. This is because the appellant took a narrow view of the contractual, relationship b between it as a banker and the respondent as her customer. For the reasons set out above I also resolve this issue against the appellant. Issues 4 and 5 considered together complain (i.) “Whether c the lower court was wrong in affirming the judgment of the, trial court having regard to the evidence before the trial court”; and (ii) “Whether or not the lower court considered issue 3 of the appellant’s brief and issue 4 set out by the d lower court itself”. Grounds 5 and 6 overlapping issue 3 of appellant’s brief which have been given full and adequate consideration in the preceding issues to need any (sic) further treatment e except to add that I adopt them and resolve them against the appellant but in favour of the respondent. Issue 6. The question issue six poses is:– “Whether the damages awarded by the trial court and confirmed f by the court below were not done properly and whether the amount awarded is liable to be set aside by this Honourable Court”. (Grounds 10 and 11.) This issue as can be deciphered from the records, is also g argued as issue 6 in the second amended appellant’s brief at pages 66 – 75. In arguing it, the appellant submitted that as the overseas suppliers are not making any demand for the money any h longer, the respondent ought not to recover the money and proceeded to criticise the assessment of damages and the award of interest. The appellant in his opening argument of this issue argued i in its brief that the damages would amount to unjust enrichment or the equivalent of a windfall. From the totality of the evidence adduced, it appears clear that the respondent proved every head of damages and the lower courts did so j find. I agree with the respondent’s submission therefore that

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC 414 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) contrary to the contention of the appellant that the a respondent has been guilty of unjust enrichment, it is rather the appellant itself which by its argument that the respondent is not entitled to the return of the money it had earlier paid to b the appellant, that wants to unjustly enrich itself, which in effect is an unjust and immoral proposition. See Chandler v Webster which is authority for the proposition that where money was paid under a frustrated contract, the payer is c entitled to recover the money. An example of this is to be found in the testimony of PW4 who admitted inter alia:– “The money I paid to U.B.A is still with CBN because CBN d circular exhibit C of November, 1988 stated clearly that the money had been returned to the defendant. I kept on writing to the defendant and they kept on assuring me that the money had been approved and awaiting remittance. It was found to be untrue.” e Continuing his evidence PW4 said:– “The defendants are negligent in many ways. They concealed money facts. They suppressed money. 1. They kept on telling me that the money we lodged with them had been approved and f awaiting remittance. 2. They kept on saying that CBN was holding the money when in fact they had collected the money since 1988 as evidenced in exhibit C. 3. They lied to our overseas suppliers that the reason why they have not paid overseas suppliers was because we had not paid local currency when in fact we have paid g over N8m. Fraudulently they were charging the plaintiff foreign exchange rate differential suggesting that foreign exchange had been allocated whereas no remittance was made.” Continuing, PW4 further pinned the appellant down with its h duplicity when he said:– “The bank has not returned the money paid to them for remittance to our overseas supplier. i It is not correct that the money should not be returned to me. It is not correct that the money is still with CBN. Defendant has no right to keep the money. Plaintiff has absolute interest in the money because the money was lodged for a specific purpose with the defendant to pay our overseas supplier . . . j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Onu JSC UBA Plc v BTL Industries Limited 415 a Defendant paid no interest on my deposit since 1984 as directed by CBN in exhibit E. They are holding on to my money without interest. If the money had been put in deposit account it would have yielded compound interest i.e. from 1988. That would be b about N150m.” The respondent further demonstrated that because of the appellant’s wilful and reckless false statements that its foreign exchange was being processed when known to it, the c CBN had returned the money back to the appellant. The respondent was black-listed by the overseas suppliers and its business collapsed as a result of the non-remittance of its money by the appellant. d It is settled law that in a case like the one in hand where there is a breach of contract, the amount of damage to be paid in respect of the breach is the amount necessary to put the respondent wronged and aggrieved in the position he e would have been had there been no breach. See Idahosa v Oronsaye (1959) 4 FSC 166; Ijebu Ode Local Government v Adedeji Balogun (1991) 1 NWLR (Part 166) 136 at 139. Since the appeal herein is from the decision of the Court of f Appeal and most of the points now raised on this issue are not properly cognisable on appeal herein, they are accordingly ignored as not arising. See Raimi v Akintoye (1986) 3 NWLR (Part 26) 97 at 105 (per Nnamani, JSC). g See also Plateau Publishing Co v Adophy (1986) 4 NWLR (Part 34) 205 at page 215. For the above reasons proffered by me and those contained in the leading judgment of my learned brother h Dahiru Musdapher, JSC. I too dismiss this appeal. I abide by the consequential orders inclusive.

KATSINA ALU JSC: I have read before now in draft, the i judgment delivered by my learned brother Dahiru Musdapher, JSC in this appeal. He has dealt admirably with all the issues raised in the appeal. I agree entirely with his reasoning and conclusion. j There is nothing I can usefully add.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA)

416 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

TABAI JSC: This judgment is sequel to an appeal against a the judgment of the Court of Appeal dated 22/7/2003 which confirmed the earlier judgment of the High Court dated 22/7/2002. The action was initiated in Division of the High b Court of Lagos State on or about the 30/5/94 when the writ of summons was issued along with a 28-paragraph statement of claim. Both the statement of claim and statement of defence were amended severally. In paragraph 62 of the c second further and better amended statement of claim the plaintiff which is respondent herein claimed against the defendant which is appellant herein the following reliefs:– (1) Declaration that the defendant was in breach of its d duty to the plaintiff by its failure to remit the overseas suppliers the purchase price (in foreign currency) of the goods supplied by its overseas suppliers for which payment was duly made by the e plaintiff. (2) An order directing the defendant to pay the sums of Pound Sterling 3,632,872.93 f US Dollar 3,384,263.37 French Francs 3,478,031.85 Deutsche Marks 3,431,790,47 g Belgian Francs 3,758,533.10 Dutch Guilders 672,810.34 Danish Krone 79,515.00 h to the plaintiff being the value of the goods ordered from overseas suppliers and received by the plaintiff and for which payment was made in Naira to the defendant at the material time at the prevailing rate i of exchange and which the defendant has failed to remit to the overseas suppliers despite repeated demands. An alternative to relief 2 above j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 417 a An order directing the defendant to pay to the plaintiff the Naira equivalent of the said sums of money at the prevailing rates of exchange at the time b the defendant chooses to pay the plaintiff:– (3) The sum of N378,780,244 being anticipated profit from 1985 to 1994. (4) Loss of profit at the rate of N6,302,510 per annum c from 1994 to date of judgment. (5) Interest on judgment debt at the rate of 7.5 % until payment is effected by the defendant. d Alternative to 5 above (6) A declaration that the defendant was in breach of its duty to the plaintiff by its failure to duly inform the plaintiff in 1988 that the Central Bank of Nigeria had e returned the sum of N8,541,557.66 which was to be remitted to the plaintiff’s overseas suppliers. (7) An order directing the defendant to pay to the plaintiff the sum of N8,544,557.66 returned by the f Central Bank of Nigeria to the defendant with the accrued interest to date. (8) An order directing the defendant to pay to the plaintiff the difference in the exchange rate in 1988 g AND the prevailing rate of exchange by Central Bank of Nigeria at the time of judgment or the prevailing rate of exchange as the defendant chooses to pay the sums of h Pound Sterling £3,632,872.93 US Dollars $3,384,263.37 French Francs Fr. 3,478,031.85 i Deutsche Marks DM.3,43 1,790.47 Belgian Francs 3,758,522.10 Dutch Guilders 672,810.34 j Danish Krone 79,515.00

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 418 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(9) Interest on the sum of N8,544,557,66 at the a prevailing rate of interest annually in 1988 when the Central Bank of Nigeria released the money to the defendant up to the time of judgment. b (10) The sum of N18,907,530 being anticipated profit from 1985 to 1987. (11) Interest at the rate of 7.5% from time of judgment to the time of payment by the defendant. c The trial involved the testimony of five witnesses for the plaintiff/respondent and seven for the defendant/appellant. One thousand three hundred and thirty one documents were admitted as exhibits at the trial. In granting the claim the d learned trial Judge B Rhodes Vivour, J (as he then was) stated at page 442 lines 22 – 24:– “Judgment is hereby entered for the plaintiff against the defendant in the unit of currency in prayer 2 or at the prevailing exchange e rate in Naira at the time the defendant chooses to pay the plaintiff.” At page 444 lines 3–4 of the record he further said:– “I hereby grant the sum of N300,000,000.00 being anticipated f profit from 1985 to 1994 and similarly loss of profit at the rate N5m per annum from 1994 to date of judgment.” And in the concluding paragraph of the judgment he stated:– “Accordingly the plaintiff claims succeed. Prayers 1, 2, 3, 4 and 5 g of the plaintiff’s second further and better statement of claim are granted with the following reductions. As regards prayer 3, it shall be the sum of N300m. As regards prayer 4 it shall be N5m per annum from 1994 to date of judgment. In the light of the fact that h the main claim succeeds the alternative claim is hereby refused. The judgment sum shall attract an interest at the prevailing interest rate fixed by Central Bank of Nigeria from 1987 until judgment and at 7% until the judgment debt is fully paid.” In its judgment, on the 22/7/2003 the Court of Appeal i dismissed the appeal and affirmed the judgment of the trial court in its entirety. In this appeal before us the parties, through their Counsel, filed and exchanged their brief of argument. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 419 a In the second amended appellant’s brief of argument prepared by Prof AB. Kasumu, SAN, seven issues for determination were formulated. While in the second b amended respondent’s brief settled by Chief Afe Babalola SAN, six issues were proposed for determination. The issues as formulated are, in substance, the same and they are:– (1) Whether the action is incompetent and liable to be c struck out for:– (a) the trial court’s lack of subject matter jurisdiction; to adjudicate in the matter; or (b) the action being statute-barred by virtue of the d provisions of section 8 of the Limitation Law of Lagos State; or (c) the respondents lack of locus standi to e prosecute the claim. (2) Whether the respondent’s case ought to be dismissed on the ground that it runs contrary to Public Policy and Act of State Doctrine. f (3) Whether the Court of Appeal was wrong in affirming the judgment of the trial court, having regard to the totality of the evidence before the court? (4) Whether the award of damages by the trial court and g affirmed by the Court of Appeal be allowed to stand? First is the question of subject matter jurisdiction under issue one above. It is the submission of learned senior Counsel for the appellant that in view of the fact that the matter pertains h to the procurement of foreign exchange for the importation of goods by sea, banking facilities and letters of credit by the defendant bank, the intricate link of the Central Bank of Nigeria and the trial court’s finding in respect thereto and i issues involving the revenue as well as the monetary and fiscal policy of the Federal Government of Nigeria, the case is not just one for negligence, contract, deceit trust or fraud within the jurisdiction of a State High Court but one which j falls within the exclusive jurisdiction of the Federal High

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 420 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Court by virtue of the provisions of the Constitution a (Suspension and Modification) Decree No. 107 of 1993, the Federal High Court (Amendment) Decree No. 60 of 1991 and section l(1)(h) of the Admiralty Jurisdiction Act. It is b further submitted in the appellant’s reply brief that the matter is not just one for simple debt recovery, breach of contract or negligence in an ordinary banker/customer relationship caught by the proviso to section 230(1)(d) of the c 1979 Constitution. Rather, it is argued, it is a case of banker/customer transaction relating to fiscal measures and involving letters of credit which came within the exclusive jurisdiction of the d Federal High Court. He relied on Cotecna International Ltd v Ivory Merchant Bank Ltd and others (2006) 9 NWLR (Part 985) 275; (2006) 6 MJSC 89. He distinguished Integrated Timber and Plywood Products Ltd v UBN Plc (2006) 5 SC e (Part 11) 52 or (2006) 12 NWLR (Part 995) 483 from the present case. Learned senior Counsel for the respondent argued, on the other hand, that the case is simply one of banker/customer f relationship based on breach of contract and negligence over which, therefore, the Federal High Court does not enjoy exclusive jurisdiction and relied on the proviso to section 251(1)(d) of the Constitution (Suspension and Modification) Decree No. 107 of 1993. It is further submitted that the mere g fact of the unit of account being in foreign currency does not make it a foreign exchange matter. He relied on Oyegoke v Iriguna (2002) 5 NWLR (Part 760) 417 at 438; NDIC v FMBN (1997) 2 NWLR (Part 490) 735 at 755, 756; CCB h (Nig) Ltd v Mbakwe (2002) 7 NWLR (Part 765) 158; De Lluch v SBN Ltd (2003) 15 NWLR (Part 842) 1 at 21 and NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107. i The purport of the proviso to section 230(1)(d) of the Constitution (Suspension and Modification) Decree 1993 which is in pari materia with section 251(1)(d) of the 1999 Constitution has been settled in a number of cases, two of j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 421 a the most recent being Federal Mortgage Bank of Nigeria v NDIC (1999) 2 NWLR (Part 591) 333 and NDIC v Okem Enterprises Ltd (supra). The provision itself states:– b “251(1) Notwithstanding anything to the contrary contained in this constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly or a Decree, the Federal High Court shall have and exercise jurisdiction to the exclusion of c any other court in civil cases and matters arising therefrom– (d) banking, banks, other financial institutions including any action between one bank and d another, any action by or against the Central Bank of Nigeria arising from banking foreign exchange, coinage, legal tender, bills of exchange, letter of credit, promissory note and other fiscal measures; provided that this paragraph shall not apply to e any dispute between the individual customer and his bank in respect of transactions between the individual customer and the bank. (Italics mine.) In Federal Mortgage Bank of Nigeria v NDIC (supra) this f court held that disputes over matters listed in section 251(1)(d) of the Constitution (Suspension and Modification) Decree No. 107 of 1993 like banking, banks, other financial institutions etc arising from simple customer/banker g relationships are, by virtue of the proviso to the subsection, exempted from the exclusive jurisdiction of the Federal High Court. And in NDIC v Okem Enterprises Ltd this Court construed the proviso to section 251(1)(d) of the 1979 Constitution to have exempted the exclusive jurisdiction of h the Federal High Court over the matters listed in the subsection if the dispute is between an individual customer and his bank and that in such cases both the Federal High Court and a State High Court enjoy concurrent jurisdiction. I i do not think we have any cause whatsoever to depart from that construction. It appears to be the most rational construction to be accorded the provision and I have no other choice than to adopt the interpretation as to the purport j and or effect of section 251(1)(d) of the Constitution

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 422 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

(Suspension and Modification) Decree No. 107 of 1993. a There is, in fact, no controversy between the parties as to the effect of the provision. The only controversy here, is whether the present dispute b is one between an individual customer and his bank in respect of transactions between them which falls within the concurrent jurisdiction of both the Federal High Court and a State High Court under the proviso to section 251(1)(d) of c Decree No. 107 of 1993. In my view, the present dispute is simply one arising from individual customer/banker relationship and falls squarely within the proviso to section 251(1)(d) of Decree No. 107 of 1993 over which the Lagos d State High Court shares concurrent jurisdiction with the Federal High Court. I hold, in consequence, that the trial court has subject matter jurisdiction. On the issue of whether the action is statute-barred, the e appellant referred to section 58 of the Limitation Law of Lagos State and submitted that the period of limitation can only be prevented from running upon proof of fraud or concealment of fraud against the appellant and which proof, f it was argued, the respondent failed to establish. It was further argued that had the respondent exercised reasonable diligence, it could have discovered the existence of exhibit “C”. With respect to exhibit “C” therefore it was submitted g that both courts below erred in postponing the commencement of the period of limitation to 1994 when the respondent allegedly became aware of the existence of exhibit “C”. The appellant finally submitted that from the h facts in exhibits DDD1 DDD2 (ie DSSR) which were sent to the respondent in 1987 the action is clearly statute-barred. The respondent on the other hand argued that there was no way it could have become aware of exhibit “C” prepared i by the Central Bank of Nigeria and sent to the appellant. The respondent further argued that in view of the pleadings in paragraph 44 of the statement of claim to which there was no specific traverse and the evidence in support thereof j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 423 a which was not contested in cross-examination the rejection of the plea by the courts below cannot be faulted. With respect to exhibit “C”, I am persuaded by the b argument of the respondent. From the facts and circumstances available, I do not see how the respondent could have become aware of the existence of exhibit “C” by sheer diligence. On this issue paragraphs 42, 43, 44 and 45 c of the second further and better amended statement of claim are relevant. The said paragraphs state:– “42. The plaintiff avers that vide C.B.N. Circular No. FOD/CFOF/08.NB/Vol. 1/28 dated 24 November, 1988 the d sum of N8,541,557.66 was returned to the defendant by the C.B.N. in 1988. 43. The plaintiff further avers that the defendant kept the fact stated in paragraph 42 (supra) from the plaintiff. 44. Due persistent demands (sic) from overseas suppliers for e payment for the goods supplied to the plaintiff, the plaintiff continued to put pressure on the defendant through letters and personal visits of the plaintiff’s Chairman to have the defendant remit the money to the overseas suppliers. The f defendant falsely continued to assure the plaintiff that the money was still with the C.B.N. and will be remitted. 45. The plaintiff avers that it was not until April 1994 that it was C.B.N. circular Ref. No. FOD/CFOF/ 08.NBVol. 1/28 dated 24/11/88 which circular confirmed that the defendant had g indeed received the money from C.B.N. as far back as 1988.” At the trial, evidence was led substantially as pleaded above. The appellant was at pains to contend that no sum of N8,541,557.66 was, by exhibit “C”, returned or refunded by h the Central Bank of Nigeria to the appellant. There is no evidence that the respondent became aware of the facts in exhibit “C” before April, 1994. And it is my view that the cause of action only accrued to the respondent upon its i becoming aware of exhibit “C”. With respect to exhibits “DDD1” to “DDD2”, the case of appellant founded therein is that it had taken steps in furtherance of settling the respondent’s overseas suppliers/ j creditors. I do not think the appellants tendered exhibits

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 424 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

“DDD1” – “DDD2” as proof of their default in using the a N8,541,557.66 to settle respondent’s indebtedness to their overseas creditors. I do not therefore see how exhibits “DDD1” – “DDD2” could sustain the plea of statute bar. On b the question of whether or not the action is statute-barred. I have no reason to interfere with findings and conclusion of trial court as affirmed by the court below. Next is the respondent’s alleged lack of locus standi to c prosecute the case. The submission of the appellant is that having regard to the uncontested facts that the respondent has received the goods for which purchase the money was deposited with the appellant for onward transfer to the d respondent’s overseas suppliers, the money no longer belongs to the respondent for it to claim and that the appellant’s duty of care is only to the overseas suppliers. It was submitted therefore that while the respondent may sue e for damages, it definitely cannot sue for recovery of the money. The settled principle of law is that it is the averments in the statement of claim that determine a plaintiff’s locus f standi. If the averments disclose that the rights or interests of the plaintiff have been or in (sic) danger of being violated or adversely affected by the act of the defendant, he would be deemed to have sufficient interest to have locus standi to sue. See: Owodunni v Registered Trustees of Celestial g Church of Christ and others. (2000) 10 NWLR (Part 675) 315 at 355; Momoh v Olotu (1970) 1 All NLR 117; Adesanya v President of Federal Republic of Nigeria (1981) 5 SC 112; Oloriode v Oyebi (1984) 1 SCNLR 390. h The substance of the pleadings in paragraphs 7, 8, 9 and 12 of the second further amended statement of claim is that its business entailed the importation and distribution of finished goods from its overseas suppliers like Meridien i Trade Corporation Limited; International Trade Meridien (I.T.M.); Meridien International Credit Corporation (M.I.C.C.) etc. That these finished goods were usually imported on credit from the overseas suppliers who usually j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 425 a sent same to it with bills of exchange or bills for collection or letters of credits. These documents were, on the instruction of the respondent usually sent to and received by b the appellant whose duty it was to secure foreign exchange allocation to the value of the received imported goods and pay the overseas suppliers/creditors. That between 1981 and 1983 several such bills and letters of credit (about 343) were c received by the appellant on behalf of the respondent. That through the negligence of the appellant, it failed to secure foreign exchange allocation from the Central Bank of Nigeria and thus the overseas suppliers/credits remained unpaid for the goods they supplied to it. And for the d damages it allegedly suffered it was pleaded in paragraphs 36 and 54 thus:– “36. As a result of the non-payment of the values of the various transactions the suppliers had stopped credit sales to the e plaintiff and that has adversely affected the business, earnings, reputation and goodwill of the plaintiff.”. “54. As a result of non payment of the outstanding items the plaintiff has been blacklisted among foreign suppliers who f have stopped supplying the plaintiff and withdrew the bank guarantee in favour of the plaintiff which guarantee were (sic) earlier granted to the plaintiff as a result of good performance.” g Are the averments in the foregoing and other paragraphs of the second further amended statement of claim not sufficient to vest the respondent with locus standi? In my view the pleadings in paragraph 19 of the second further amended statement of claim notwithstanding, the totality of the h averments sufficiently disclose allegations that the rights and interest of the respondent have been violated or at least adversely affected to entitle it to sue. I agree that the two courts below appear to have based their i determination of this issue of respondent’s locus standi on the trial courts findings at the trial instead of the averments in the statement of claim. However their conclusion about the respondent’s locus standi cannot, in view of the j pleadings be faulted.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 426 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Further more in paragraphs 29 and 30 of the third a amended statement of defence the appellant pleaded as follows:– “29. The defendant will maintain at the trial that the plaintiff’s b overseas suppliers were at all material times members and affiliates of the ITM Corporation Limited formerly Saltraco Holdings Limited and hold 40% equity shares in the plaintiff. The defendant shall rely the (sic) plaintiff’s Memorandum and Articles of Association at the trial.” c “30. The defendant further avers that the plaintiff’s foreign suppliers did not blacklist the plaintiff as both the said foreign suppliers and the plaintiff are both shareholders and/or joint owners of the plaintiff.” d These averments clearly show the appellant’s acknowledgment of the respondent’s interest in the alleged failure of the foreign exchange transactions. It therefore looks preposterous, in my respectful view, for the self same e appellant to challenge the respondent’s locus standi. The result from the foregoing considerations is that I also resolve this issue of the respondent’s locus standi in favour of the respondent. f The next issue is whether the respondent’s case is liable to dismissal on the ground that it is contrary to public policy and act of state doctrine. It was argued by the appellant that in appropriate circumstances public policy is applied in the g administration of justice. It was submitted that the refinancing exercise was an act of state and that liability, if any, arising therefrom ought to be excused. Appellant relied on the case of Alfotrin Ltd v A-G, Federation (1996) 9 h NWLR (Part 475) 634. The submission of the respondent in reaction is that the issue of Public Policy and Act of State is a special defence which was however not raised in the pleadings and is raised i here for the first time and is therefore liable to be struck out. The respondent cited quite a number of cases on the appellant’s duty to specifically plead special defences like this – amongst them Kano v Oyelakin (1993) 3 NWLR (Part j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 427 a 282) 399 at 409; Akintola v Balogun (2000) 1 NWLR (Part 642) 532; Atta v Ezeanah (2000) 11 NWLR (Part 678) 363. Here again, I am inclined to uphold the objection of the b respondent. The issue of whether or not the claim is against or contrary to public policy and act of state was not raised either expressly or by necessary implication in the pleadings. Nor was it raised as a point of law before the two courts c below. It is being raised here for the first time and I do not think this Court can entertain it particularly having regard to the fact that the two courts below had not the opportunity to express their opinion on it. Even Alforin v A-G, Federation d (supra) cited by the appellant seems to support the stance of the respondent where at page 664, this court per Ogundare, JSC said:– “In the appeal on hand, the defendants did not plead act of state as e a defence nor was it ever the basis of their case. They based their defence on there being no privity of contract between them and the plaintiff . . ..” That the protection sought under an act of state or executive action was refused. It is my view that the defence of public f policy or act of state does not avail the appellant and I so hold. I now come to the issue of whether the Court of Appeal g was wrong in affirming the judgment of the trial court having regard to the totality of the evidence before the court. The appellant alleges failure of or improper evaluation, contending that had the trial court embarked upon a proper evaluation, particularly the documentary evidence available, h it would not have come to the same conclusion. Specifically, the appellant complains of the trial court’s failure to evaluate documentary evidence tendered through the DW5, namely, exhibits XX1 – XX75, YY1 – YY265, E.E. spread sheets i ZZ1 – ZZ267 spread sheets HH1 – HH10 and GO, AAA1 – AAA2, BBB1 – BBB19, CCC1 – CCC3 and DDD1 – DDD2. It was the appellant’s submission that the explicit and detailed evidence of the DW5 supported by these j documents shows that 321 out of the 331 bills submitted by

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 428 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) the respondent to the appellant were duly processed, a approved and paid for by the Central Bank of Nigeria. It was further argued that neither the trial court nor the Court of Appeal made any reference to the evidence of DW5 or a b review of the documents and that the failure so to do led to the perverse findings. With specific reference to DSSR eventually admitted in evidence as exhibits “DDD1” – “DDD2” to which neither court allegedly made any c specific reference, it was the submission of the appellant that the document is conclusive proof that the bills were processed and settled through the Central Bank of Nigeria by the appellant. The appellant highlighted areas of the oral evidence of the defence witnesses especially d DW1 and DW3 and contended that the findings of the trial court were not borne out by the evidence and therefore that there was no basis for these witnesses to have been discredited. e On its part the respondent, at pages 46 – 48 of its brief itemised a number of reasons which, it claims, justify the concurrent findings of the courts below that its Bill were f (sic) not refinanced and that the Central Bank of Nigeria returned the whole of the respondent’s N8,541,557.66 to the appellant since 1988. I shall, in the course of this judgment, make recourse to these. With respect to the documentary evidence allegedly not considered by the two g courts below, it was the submission that none of them contained a single debit note or a schedule of payment of any of the 333 bills of the respondent and that the non- specific reference to them by the trial court would therefore h not alter the findings and judgment. None of the exhibits, it was argued, qualified for the mandatory Debit Advice or Central Bank of Nigeria Schedule of Payment. And in an attempt to show that the documents did not improve the i appellant’s case, the respondent embarked on a detailed analysis of the exhibits. The most crucial question is were the respondent’s bills refinanced and the respondent’s overseas creditors, for j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 429 a whom the sum of N8,541,557.66 was meant, paid? The uncontroverted facts are that the plaintiff/respondent, which (sic) main business is the importation and sale of some type b of goods from various overseas suppliers, has had a customer/banker relationship with the defendant/appellant with and through which it carried out its business. Between 1981 and 1983 the respondent imported, on credit, goods from various overseas suppliers. On the instruction of the c respondent and pursuant to their banker/customer contractual relationship the goods were sent to the respondent through the appellant with bills of exchange or bills for collection or letters of credit totalling 333 bills which are exhibits “P1” – d “P333”. The total amount of Naira equivalent for the settlement of these bills in foreign currencies was N8,541,557.66. On agreement and for the settlement of these debts, the appellant appropriated the said sum by debiting the e current account of the respondent and was expected thereafter to apply to the Central Bank of Nigeria for approval and foreign exchange allocation for onward remittance to the respondent’s overseas suppliers/creditors. f The case of the respondent is that due to the negligence of the appellant no Central Bank of Nigeria foreign exchange allocation was obtained and so its overseas creditors remain unpaid and it remains indebted to them. And that its debt g payment exercise having failed, the Central Bank of Nigeria has, since November, 1988, returned the said sum of N8,541,557.66 to the appellant which, however, concealed that fact from it until 1994 when by sheer accident exhibit h “C” by which the Central Bank of Nigeria returned the money to the appellant was obtained. On the other hand, the case of the appellant as pleaded in paragraphs 7, 8 and 11 of the third amended statement of i defence is simply that it discharged all its obligations under its banker/customer contractual relationship with the respondent and that all the respondent’s 331 bills were at its instance, duly processed, approved and paid by the Central j Bank of Nigeria under the debt refinancing scheme.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 430 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

I shall now consider the complaints of the appellant using a the three points complaint as stated in paragraph 2.02 at page 6 of the amended appellant’s reply, brief namely:– (a) Non-consideration of the documentary evidence b submitted by the defence. (b) Distortion of the oral testimony of the DW1, DW2 and DW5. c (c) Misconstruing the contents of exhibit “C” and the evidence led on it. I would begin with the alleged distortion of the oral testimony of the DW1 and DW3 and DW5. In the first place d I agree with learned Counsel for the appellant that none of the DW1 and DW3 expressly admitted that by exhibit “C” the Central Bank of Nigeria returned the sum of N8,541,557.66 to the appellant. The learned trial Judge e repeatedly found that one or other of the defence witness admitted that fact of the return of the sum of N8,541,557.66 via exhibit “C”. At page 442 lines 14 – 16 the learned trial Judge credited the said evidence to have been adduced by f the DW1. He said:– “Indeed DW1 said on oath that the sums paid by the plaintiff, that is the Naira equivalent of N8,541,557.66 was returned to it and the said sum are held in trust for the overseas suppliers.” g There was no testimony of the DW1 to that effect. Again the learned trial Judge repeatedly found and stated that the appellant had been using the respondent’s money ie N8,541,557.66 for 18 years. At page 44 lines 23 – 24 he h said:– “The defendant has had the use of the money for the past 18 years and as at today is still trading with the plaintiff’s money.” Exhibit “C” by which the money was allegedly returned i clearly belies that finding of the learned trial Judge and affirmed by the Court of Appeal. Besides, the finding is incompatible with the respondent’s assertion made in paragraphs 42 and 45 of the second further and better j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 431 a amended statement of claim. In paragraph 42 the respondent pleaded:– The plaintiff avers that vide Central Bank of Nigeria Circular No. b FOD/CFOF/08.NB (Vol. 1/28) dated 24 November, 1988 the sum of N8,541,557.66 was returned to the defendant by the Central Bank of Nigeria in 1988.” The pleading in paragraph 45 is to the same effect. If this c money was returned to the defendant via exhibit “C” in November 1988 as pleaded in paragraphs 42 and 45 of the statement of claim, the defendant could not have used it for 18 years. I am quite conscious of the burden on an appellant d who complains against a concurrent finding of fact. The policy of this Court is not to disturb the concurrent finding of both the High Court and Court of Appeal, unless there is some miscarriage of justice or a violation of some principles of law. See Umeojiako and another v Ezenamuo and others. e (1990) 1 NWLR (Part 126) 253; Afolayan v Ogunrinde (1990) 1 NWLR (Part 127) 369. In this case the concurrent finding about the appellant’s use of the money for 18 years is clearly not supported by the evidence on record and so f that findings should be set aside. The impact of these findings on the case depends, by and large, on the totality of the evidence before the Court and that shall be addressed in due course in this judgment. g The next complaint is the alleged non-consideration of some documentary evidence tendered by the defence which details I have earlier stated above. One thousand three hundred and thirty one documents were tendered and I h agree with learned Counsel for the respondent that the mere failure of the learned trial Judge to comment and pronounce upon each and everyone of them is not enough to vitiate the judgment. The submission of learned i Counsel for the appellant is that had the documents been considered the judgment would have been different since, according to him, they are conclusive proof that respondent’s bills were settled and paid for by the Central j Bank of Nigeria.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 432 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

I had earlier made reference to the submission of learned a Counsel for the respondent to the effect that the documents have no probative value and that their consideration would not have altered the concurrent findings and judgment of the b lower courts. Although the documents have been admitted, the weight to be attached to their contents is another matter. The controversy here calls for this Court’s evaluation of the documents to determine their probative value. The exercise c has nothing to do with the assessment of the credibility of witnesses and so this Court is in an advantage position as the two lower courts to embark upon the evaluation exercise (sic). See A-G, Oyo State and another v Fairlakes Hotels Ltd d and another (1989) 5 NWLR (Part 121) 255 at 282 – 283, 292; Ayeni v Dada (1978) 3 SC 35; Akinola v Oluwo (1962) 1 SCNLR 352. Let me now examine these exhibits in the light of the e comments on them by learned senior Counsel for the parties. The first exhibit “GG”. Both Counsel for the parties drew attention to the evidence of witnesses on this set of exhibits. Under cross-examination the DW 1 at page 164 of the f record testified thus on exhibit “GG”:– “. . . I cannot remember whether exhibit GG was in existence before I left. There is no date on exhibit GG as to when it came into existence . . . I cannot remember the officer who received g exhibit GG. Central Bank of Nigeria is a public institution. When they send documents to commercial banks they would accompany it with their letter. Exhibit GG does not contain any covering letter.” h Still continuing on exhibit “GG” the DW1 stated further:– “I see exhibit GG. There is no stamp of C.B.N. there. There is no letter accompanying it. Nowhere is it signed by anyone as the maker. It is computer printout. It was not certified by i C.B.N. or anyone. I do not know who received it (exhibit GG) I only went to the archives and collected it for this case. Plaintiff is claiming 333 bills. There are 80 bills in exhibit GG. No column in exhibit GG showing where, when and how payment was made.” j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 433 a At page 175 of the record of appeal the DW2 spoke of exhibit “GG” as follows:– “I see exhibit GG. It is a working document. My working b document when I was in U.B.A. It contains ECGD refinanced claims for various importers and exporters and BTL’s claim in this binder are 197.” The DW3 also gave some evidence on exhibit “GG”. In the c light of the evidence of these defence witnesses on exhibit GG it cannot in any conceivable sense be any proof that the respondent’s 331 or 321 bills were duly processed approved and paid by the Central Bank of Nigeria. The d DW1 and DW2 would not even agree as to the number of the respondent’s bills that are contained in exhibit “GG”. While one said 80 the other said 197. It is certainly not a document in which the court can rely to find in favour of the appellant. e Next is exhibits “HH1” – “HH10”. These are 10 letters from the UBA, Lagos. Each one is dated 19/10/88. And each is headed RE: TRADE DEBT REFINANCING f PROGRAMME. Each is stated to have debited the UBA account with the sum stated therein. There is nothing in each indicating its connection with the respondent’s 331 or 321 bills or even with the respondent at all. For the g determination of whether the respondent’s bills were processed, approved and paid for by the Central Bank of Nigeria, the exhibits have no probative value and not helpful to the case of the appellant. h Exhibits “AAA” – “AAA2”. At page 218 of the record of appeal the DW5 said of these exhibits:– “Exporters ceded their right to ECA. In certificate C there is always a summary attached to certificate C. It comes with it.” i The summary sheets attached to certificate C were admitted as exhibits “AAA1” – “AAA2”. All I can say about these exhibits is that on their face, there is nothing clearly indicating that overseas creditors have ceded their rights to j somebody else.

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 434 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III)

Exhibits “XX1” – “XX75” and “YY1” – “YY205”. These a are only proof that the Central Bank of Nigeria took steps in the refinancing programme. Exhibits “BBB1” – “BBB19”. These are another set of b documents on which the appellants heavily relied in proof of their case. In his evidence the DW5 spoke of these documents as follows:– c “I see exhibits BBB1 – BBB19, 317 bills are contained therein. Export Credit Agencies assume the liabilities of the suppliers because they are the insurers of the goods. In turn they assume direct payment to the suppliers.” d These documents are each headed BUYERS DETAILS. I checked them and the bills bearing the name of the respondent or its former name BISIOLU TECHNICAL LTD are about 729. The difference between this figure of about 729, the DW5’s figure of 317 and the figure of 331 or 321 e was not explained. On the number of the respondent’s bills processed, approved and paid by the Central Bank of Nigeria, exhibits “BBB1” – “BBB19” do not help the case of the appellant. f The next set of documents is exhibits “CCC1”, “CCC2” and “CCC3” stated to be ECGD claims paid lists for the appellant. It is another set of documents on which the g appellant relied heavily. Under cross-examination the DW5 commented on these documents as follows:– “I see exhibits CCC1, CCC2, CCC3. There are some hand writing on page 1. I do not know when it was written. I in company of h staff brought exhibit CCC1 from Abuja. The writing were on it when I brought it from Abuja. I is signed by Olorundare. Exhibit CCC1 has always been in my possession. Ojukwu who signed it and Olorundare who also signed are not staff of Central Bank of Nigeria. I do not know both of them in Central Bank of Nigeria i (sic).”(Italics mine.) If the two persons who signed the documents are not staff of the Central Bank of Nigeria and there is no explanation as to how these strangers became signatories of the documents, j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 435 a I do not see how such documents would attract some probative value in the assessment of a court. Another set of documents on which the appellant relied b heavily in proof of their case is exhibits “DDD1” and “DDD2”. They are said to be the certified true copies of DSSR and the appellant’s assertion is that these were sent by the Central Bank of Nigeria direct to the respondent and c they are so addressed. The respondent denied receiving these documents. Learned senior Counsel for the respondent was, again at some pains to impugn the probative value of these documents. It was his contention that the documents do not d contain the BCAP numbers, the overseas suppliers invoice numbers and dates contained in exhibits “P1” – “P333”. I examined and tried to compare the contents of these two sets of documents. e The dissimilarities between the two sets highlighted by learned senior Counsel for the respondent may be there. I however just could not identify them. But one thing became clear. The letter embodying the documents was dated 21 f May, 1987. It is headed DEBTOR SUMMARY STATUS REPORT issued as of 31 July, 1985. The bills contained therein are 356. It is a common ground that the respondent’s bills submitted were 331 or 333; not more than 333. There was no explanation as to the source of the remaining 23 or g 25 bills credited in these documents to be those of the respondent. Again the appellant maintained throughout the trial that out of the respondent’s 331 bills 321 were matched and 10 were unmatched and rejected as being frivolous. I h counted the matched bills in exhibits “DD1” and “DDD2” to be 271 and unmatched bills to be about 42. In the face of these features in exhibits “DDD1” and “DDD2” I cannot say that the document provided any conclusive proof that 321 or i the respondent’s were processed, approved and paid by the Central Bank of Nigeria. The last exhibit which non-evaluation the appellant complained about is exhibit “EE”. This is the only document j that records 331 bills for the respondent. Again the numbers

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 436 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) of bills refinanced and those not refinanced does not tally a with the number contained in the oral testimonies of defence witnesses. The above is a fairly detailed analysis of the specific b documentary exhibit about which non-evaluation, the appellant complained. The documents together constitute an integral part of the defence of the appellant and the trial court had no reason whatsoever not to consider them. The c trial court and indeed the Court of Appeal had a duty to carefully consider them. See Akeredolu v Akinremi (1989) 3 NWLR (Part 108) 164; Olowosago v Adebanjo (1988) 4 NWLR (Part 88) 275; Karibo v Grend (1992) 3 NWLR (Part d 230) 426. There is nothing on the record to show that these documents on which the appellant relied so heavily were given the due consideration they deserved. The appellant thus had good cause to complain. The Court of Appeal e appears to have also fallen into the same error of not considering the exhibits. This Court has a duty to examine these documents and that is what I have done. See Imah v Okogbe (1993) 9 NWLR (Part 316) 159; Anaeze v Anyaso (1993) 5 NWLR (Part 291) 1. f What is thereby established from the review of the documents is that steps were taken by the appellant and the Central Bank of Nigeria to settle the respondent’s overseas suppliers with the funds – N8,541,557.66 made available for g that purposes. And for the reasons which I have stated with respect to each set of the documents, I do not think they provide any conclusive proof that 321 of the respondent’s 331 or 333 bills were processed, approved and paid by the h Central Bank of Nigeria. Thus although the two courts below did not, in their assessment of the case, refer specifically to these documents, the failure so to do, without more, does not make the judgment perverse. Whether or not i the judgment is perverse still depends on the totality of the evidence before the court. Another controversy between the parties pertains to whether or not the appellant was entitled to hold and keep j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 437 a the money returned via exhibit C in trust for the respondent’s overseas suppliers. Although the appellant pleaded in paragraphs 16 and 17 of its third amended b statement of defence to the effect that if any of the respondent’s money is with it, it holds same as trustee for the respondent’s overseas suppliers, its evidence was contradictory and does not support that assertion. It is true c the DW1 gave evidence in support of that assertion when at page 161 of the record he said:– “I know from records that in 1988 December Central Bank of Nigeria returned all moneys in respect of unremitted bills back to commercial banks. The commercial bank is not expected to return d it to the owner. The money should be kept in trust for the beneficiaries pending satisfaction or certain conditions . . .”. But the DW5 a Deputy Director of Central Bank of Nigeria at page 222 of the record contradicted the DW1 when he e said:– “C.B.N. returned money to the commercial banks for onward transmission to importers for bills that did not match.” I think the DW5 is a stronger authority on the matter. f Besides, exhibit “C” does not seem to convey any authority on the commercial Banks to hold such customers’ money refunded in trust for the foreign suppliers. Part of exhibit “C” reads:– g “Consequently, all future requests for the refund of Naira and those pending in Central Bank of Nigeria should be treated by you without further reference to the Central Bank of Nigeria.” The above clearly shows that customers were making h requests for refund of moneys collected from them and the commercial banks were, by Exhibit “C”, advised to treat all such, further requests without reference to the Central Bank. I hold therefore that the respondent was entitled to be i refunded any money in respect of any of its 333 bills that was not remitted or settled. This leads to the next and very crucial question. It is the question on which the whole controversy is founded and it is j this. How much of the sum of N8,541,557.66 appropriated

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 438 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) from the current account of the respondent by the appellant a for remittance to the respondent’s overseas suppliers was returned by the Central Bank of Nigeria to the appellant via exhibit “C”? It is a common ground that by exhibit “C” the b Central Bank of Nigeria returned Naira cover for the respondent’s unmatched and unrefinanced bills. The case of the respondent is that there is no proof of the settlement of any of its 333 bills and therefore that it was the entire c N8,541,557.66 that was returned through exhibit C. The appellant on the other hand maintained in evidence that 321 of the respondent’s 331 bills were matched and their Naira cover utilised and that it was the Naira cover for the 10 unmatched and rejected bills that was returned through d exhibit “C”. As a general rule the burden of proof is on the plaintiff to show that he is entitled to the relief sought. It is however not e the law that the burden of first proving every particular fact invariably lies on the plaintiff. Section 137(1) of the Evidence Act Cap. 112 Laws of Federation of Nigeria, 1990 provides:– f “In civil cases the burden of first proving the existence or non existence of a fact lies on the party against whom judgment of the court would be given if no evidence were produced on either side, regard being had to any presumption that may arise on the pleadings”. g And section 137(2) says:– “If such party adduces evidence which ought reasonably so (sic) satisfy jury that the fact sought to be proved is established, the burden lies on the party against whom judgment would be given if h no more evidence were adduced, and so on successively, until all the issues in the pleadings have been dealt with.” Going by these provisions therefore, there may arise situations where a defendant may be required, on the state of i pleadings, to lead evidence to discharge the burden of proving the existence of a particular fact. See Okubule v Oyagbola (1990) 4 NWLR (Part 147) 723; UBN Ltd v Penny Mart Ltd (1992) 5 NWLR (Part 240) 226; FATB Ltd v j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 439 a Partnership Investment Company Ltd (2003) 18 NWLR (Part 851) 35. The respondent led evidence that it is entitled to be b informed by the appellant about the settlement of any of its bills and that because none of its 333 bills was settled no such information was given to him by the appellant. That it received no debit advice accompanied by schedule of c payment (which alone constitutes evidence of payment) from the appellant. On this state of the pleadings and evidence and having regard to the fact that the questions about the number of bills d paid and those not paid and the Naira cover for every unmatched and unpaid bill for which exhibit C was made are facts which existence is peculiarly within the knowledge of the appellant and the Central Bank of Nigeria, the burden of e proof of the total number of bills not matched and not paid. and their Naira cover therefore lies squarely on the appellant. Was this burden discharged to entitle the appellant to the f judgment of this case and thus a dismissal of the respondent’s case. This is where the appellant ran into troubles. It is where the appellant, by its conduct of the defence, earned the trial court’s tirade of damnifying g language. The trial court had the impression that the evidence of the defence was sometimes at variance with its pleadings and generally unreliable. h The first evidence which established appellant’s unreliability is contained in exhibit “B”. It cannot be contested that the respondent was entitled to be informed about exhibit “C” and the status of its interest conveyed therein. Exhibit “C” is dated 24 November, 1988. Even if i the said exhibit returned only the sum of N12,030.49 as the appellant claimed in exhibit “B” the appellant had a duty to inform the respondent about it and even remit the said amount to the respondent. Appellant hid the facts about j exhibit “C” from the respondent for nearly six years. And

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 440 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) when the appellant had reason to write exhibit “B” on 13 a May, 1994, it told, what turned out to be, a lie that it received only the Naira cover for one bill which is N12,030.49. The appellant went on to state, rather b arrogantly, that the respondent was not even entitled to the refund of the N12,030.49. As I said, exhibit “B” clearly demonstrates the appellant’s insincerity in its dealings with the respondent – its self confessed “valued customer”. c Exhibit “B” was made before the writ of summons in this suit was issued. On this question of the number of bills settled and those unmatched and thus rejected the appellant took a position different from that in exhibit “B”. In part of d paragraph 11 of the third amended statement of defence it averred:– “The defendant avers that all the transactions concerning the bills for collection and unconfirmed letters of credit relating to the plaintiff have been approved and refinanced by the Central Bank e of Nigeria.” See also paragraphs 7 and 8 where the appellant pleaded to the same effect. f It was not the case of the appellant, as pleaded, that a specific number of the respondent’s bills were refinanced and some unrefinanced. The case was that all the respondent’s bills were settled and that there were no g unrefinanced bills which Naira cover was sent through exhibit “C”. At the trial therefore all the oral and documentary evidence about returned and unrefinanced bills were at variance with the case pleaded. h As respect (sic) the evidence itself the oral testimony of the various defence witnesses was consistent as to the number of the respondent’s bills submitted, the number matched and refinanced and that unmatched and unrefinanced. The evidence was that the respondent’s bills i submitted were 331 out of which 321 were refinanced and 10 unmatched and rejected. Defence however did not identify the 10 unmatched and rejected bills which Naira cover was sent through exhibit “C”. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 441 a The refinancing exercise was entirely documentary and in proof or its assertion the appellant tendered quite a number of documentary, exhibits. They include exhibits XX1 – b XX75, YY1 – YY265, ZZ1 – ZZZ67, HH1 – H1 – 110, GG, AAA1 – AAA2, BBB1 – BBB19, CCC1 – CCC3 and DDD1 – DDD2. I have earlier above pointed out features in these exhibits that tended to render them unreliable, besides, c on this all important issue as to the number of respondent’s bills, the number matched and that unmatched and rejected no two documents submitted by the appellant tell the same story. Exhibit “EE” contains 331 bills and so is consistent d with the oral testimony of defence witnesses. But it records the unmatched bill which Naira cover was presumably sent through exhibit “C” to be 9. With respect to exhibit “GG” the DW1 and DW2 each told a different story about the respondent’s bills contained therein. The DW1 claimed at e page 164 of the record that respondent’s bills in exhibit “GG” are 80. At page 175 the DW2 said they were 197. Exhibits “BBB1” – “BBB19” presents a completely different account on the number of the respondent’s bills f presented. The DW5 testifying on this set of documents said there were 317 bills. I checked and saw the bills bearing the name of the respondent or its former name BISIOLU TECHNICAL LTD to be about 729. Exhibits “DDD1” – g “DDD2” records about 271 matched bills and about 42 unmatched bills. As I said no two documents presented by the appellant tell the same story about the number of unmatched bills which Naira cover was sent by the Central h Bank of Nigeria to the appellant through exhibit “C”. The pre-trial exhibit “B” tells a completely different story. Perhaps the appellant forgot its position on this issue of unrefinanced bills and corresponding Naira cover when it i was formulating its pleadings. On the whole the entire evidence of the appellant was not only at variance with its case as pleaded, it was also full of contradictions. In view of the above, it cannot be seriously contended that j there was conclusive documentary proof of the respondent’s

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 442 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) unmatched bills and their Naira cover. On this issue, the a appellant failed completely to discharge its burden of proof. The trial court was, in the circumstances, right to accept the case of the respondent and reject that of the appellant. b Before concluding this issue, there is need to comment upon another aspect of the case where the appellant demonstrated complete disregard for its banker/customer relationship with the respondent. In paragraph 51 of the c second further and better amended statement of claim the respondent pleaded:– “While trading with plaintiff’s funds, the defendant continues to charge exorbitant interests on the facilities granted to her to d finance the remittance without effecting the remittance.” This assertion was amply supported by evidence from both parties. The DW2, for instance, stated under cross- examination at page 18 of the record thus:– e “In 1994 the plaintiff was owing about N10m. In 1998 about N19m. Interest alone accounted for N19 (sic) from 1994 to 1998. The plaintiff had a rosy patronage with us before this incident. I see exhibit B. It is from the defendant to the plaintiff. Before then f he was valued customer of the bank.” Thus the respondent’s indebtedness to the appellant increased by almost 100% in four years. The appellant, upon g receipt of exhibit “C” decided to withhold the respondent’s money conveyed thereby for 14 years at the time of the judgment at the trial court on the 22/7/2002. The money has been withheld now for 18 years. If the respondent had been indebted to the appellant to the tune of N8,541,557.66 in h 1988 what would have been the indebtedness today? Yet the appellant has argued severally that the respondent’s entitlement should not be more than N8,541,557.66. One can take judicial notice of the fact that the appellant is one of i the most reputable banks in the country. And in defence of its reputation and standing in the banking industry, it ought to display absolute good faith in its dealing with its customers. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC UBA Plc v BTL Industries Limited 443 a As stated earlier in this judgment, this issue of whether the Court of Appeal was wrong in affirming the judgment of the trial court having regard to the totality of the evidence is b the key issue. In view of all I have discussed above it ought to be and is hereby resolved in favour of the respondent. The last issue is the award of damages by the trial court and affirmed by the Court of Appeal be allowed to stand. On c this issue learned Senior Counsel for the appellant argued that the award of N300,000,000 as anticipated profit and N5,000.000 as loss of profit from 1994 to date of judgment is not supported by the evidence of the PW4. In support of d this contention learned Senior Counsel referred to exhibits “S1” – “S10” wherein it is disclosed that the respondent’s profit for the period 1982 – 1985 was less than N600,000 and that its 1984 before tax profit was only N28,734. It was further submitted that a person claiming special damage has e a duty to furnish the other party with details of the basis of such a claim in his pleading so that the latter party can verify the claims so made. He relied on A-G, Oyo State v Fairlakes Hotels (No. 2) (1989) 5 NWLR (Part 121) 255 at 279. f Learned Senior Counsel for the respondent on his part argued that there was evidence in support of every item of award that was made. He quoted extensively from the evidence of the PW4 and submitted that the awards were g justified. Learned Senior Counsel cited Idahosa v Oronsaye (1959) 4 FSC 166; (1959) SCNLR 407; Ijebu Ode Local Govt v Balogun (1991) 1 NWLR (Part 166) 136 at 159; Swiss Nigeria Wood v Bogo (1972) 1 All NLR (Part 2) 433. h With respect to the award of interest of N5,000,000 per annum Counsel again argued that the award was justified by the evidence and relied on Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) 422 at 445 and NGS Co Ltd v i NPA (1990) 1 NWLR (Part 129) 741 at 748. He prayed that the issue of damages awarded be resolved against the appellant. It is clear from the award that the N300,000,000 comes j within general damages since it is not specifically tied to any

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC 444 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART III) item of special damage specifically pleaded and proved. It is a settled law that general damages, usually awarded to assuage loss suffered by a plaintiff from the acts of a defendant, is a matter of inference based on the trial court’s discretion. And b an appellate court ought not to interfere with such award of general damages unless:– (a) Where the trial court has acted under a mistake of law; or c (b) Where he has acted in disregard of principles; or (c) Where he has taken into account irrelevant matters or failed to take into account relevant matters or d (d) Where injustice would result if the appellate court does not intervene; or (e) Where the amount awarded is either ridiculously low or ridiculously high that it must have been a whole e erroneous estimate of the damage. See UBN Ltd v Odusote Bookstores Ltd (1995) 9 NWLR (Part 421) 558 at 556; Adewuyi v Abibade 4 WACA 169; Obere v Board of Management, Eku Baptist Hospital (1978) f 6 – 7 SC 15. While considering, the award of damages the learned trial Judge laboured under the misapprehension of fact that the appellant had used the money for 18 years. At page 443 he g said:– “The defendant has had the use of the money for the past eighteen years and as at today is trading with the plaintiff’s money.” h He repeated this several times in the judgment. As I pointed earlier in this judgment the finding is not supported by the evidence in court. Exhibit “C” by which the money was returned to the appellant was in 1988. The appellant use of the money from 1988 to 2002 cannot therefore be 18 years. i The finding is also contrary to the case pleaded by the respondent at paragraphs 42 and 45 of the second better and further amended statement of claim. And it is clear that his perseverance in this error greatly influenced his award. j

[2004 – 2006] 13 N.B.L.R. (PART III) (SUPREME COURT OF NIGERIA) Tabai JSC United Bank for Africa Plc v BTL Industries Limited 445 a Besides, the award is unreasonably excessive. Although the respondent adduced some evidence of anticipated profits, it is not such evidence that should reasonably attract b such huge award. In granting the main relief in foreign currencies the learned trial Judge:– “It is a known fact that currencies are no longer stable. They swing around with every gust that blows. Judgment should be delivered in whatever currency seems fair and just in the circumstances of c the case.” Entering judgment in favour of the respondent has its peculiar significance in this case and that sufficiently meets the fairness and justice of the case. In the circumstances this d Court should intervene in the award of N300,000,000 which is accordingly set side. Similarly, for loss of profit at the rate of N5m per annum from 1994 to date of judgment is set aside. It is in the nature e of special damages and certainly there was no proof to justify its award. In conclusion, and subject to the orders with respect to f reliefs 3 and 4 for damages, the appeal fails and is accordingly dismissed. The appeal against the damages awarded under reliefs 3 and 4 succeeds and accordingly allowed. Having regard to the fact that the main appeal fails the respondents is entitled to costs which I asses at g N10,000,00. Appeal allowed in part.