Volume 13 Part 2

NIGERIAN BANKING LAW REPORTS

[2004 – 2006]

VOLUME 13 PART II

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

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

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© 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.

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EDITORIAL BOARD

1. Professor J.O. Anifalaje Chairman Faculty of Law, University of Ibadan 2. Alheri Bulus Nyako Editor-in-Chief Board Secretary/Head of 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.

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

1. HON. JUSTICE ZAINAB ADAMU BULKACHUWA (Acting 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 HA ABIRU 14. HON. JUSTICE MONICA B. DONGBAN-MENSEM 15. HON. JUSTICE CHIDI NWAOMA UWA 16. HON. JUSTICE ADAMU JAURO 17. HON. JUSTICE OO 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 23. HON. JUSTICE HELEN MORONKEJI OGUNWUNMIJU 24. HON. JUSTICE SIDI DAUDA BAGE 25. HON. JUSTICE AYOBODE OLUJIMI LOKULO-SODIPE v [2004 – 2006] 13 N.B.L.R. (PART II)

Nigerian Banking Law Reports

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 PO IGE 31. HON. JUSTICE IS BDLIYA 32. HON. JUSTICE MOHAMMED LADAN TSAMIYA 33. HON. JUSTICE EJEMBI EKO 34. HON. JUSTICE CE 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 OA 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 54. HON. JUSTICE TIJJANI ABDULLAHI 55. HON. JUSTICE AHMAD OLAREWAJU BELGORE 56. HON. JUSTICE TUNDE OYEBANJI AWOTOYE 57. HON. JUSTICE JS ABIRIYI vi [2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION)

Seniority List of Justices of the Court

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

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SENIORITY LIST OF JUSTICES OF THE FEDERAL HIGH COURT OF NIGERIA AS AT 31 JULY, 2013

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 II) (COURT OF APPEAL, IBADAN DIVISION)

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 FO GIWA-OGUNBANJO 59. HON. JUSTICE MUSA HARUNA KURYA

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Nigerian Banking Law Reports

60. HON. JUSTICE EVELYN N. ANYADIKE 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 partici- pating 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 II)

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 II)

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 II)

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 II)

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

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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 recovering 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 per- manent 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 II)

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 II)

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

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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 ...... liii Index of Nigerian Statutes referred to ...... lvii Foreign Statutes referred to...... lxiii Index of Nigerian Rules of Court referred to...... lxv Index of Books referred to...... lxvii

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TABLE OF CASES REPORTED

Page 1. African Continental Bank Plc v. Okorie 204 2. Akanmu v. Co-operative Bank Plc 124 3. Auto Import Export v. Adebayo 272 4. Continental Trust Bank Ltd v. Govt. of Kogi State of Nig. 449 5. Daniel Holdings Ltd v. UBA Plc 16 6. First Bank of Nigeria Plc v. Jibo 453 7. Int. Trust Bank Plc v. Kautal Hairu Co. Ltd 177 8. Macpepple v. Central Bank of Nigeria 381 9. NDIC v. O’Silvawax International Ltd 343 10. NUC v. Societe Generale Bank (Nig) Ltd (No. 1) 365 11. NUC v. Societe Generale Bank (Nig) Ltd (No. 2) 492 12. Ndoma-Egba v. African Continental Bank Plc 143 13. Nigerian Advertising Services Ltd v. UBA Plc 95 14. NNB International Bank Plc v. Triumph Bank Plc 193 15. Onuselogu Ent. Ltd v. Afribank (Nig.) Plc 86 16. Saleh v. Bank of the North Ltd 429 17. Thor Ltd v. First City Merchant Bank Ltd 1 18. UBN Plc v. Omniproducts (Nigeria) Ltd 470 19. UBN Plc v. Boney Marcus Ind. Ltd 113 20. Union Bank of Nigeria Plc v. Chimaeze 397 21. Universal Trust Bank Nig Ltd v. Ajagbule 31 22. Vibelko Nigeria Ltd v. NDIC 256 23. Wema Bank Plc v. Abiodun 215

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INDEX OF SUBJECT MATTER

APPEAL Additional evidence on appeal – Failure to tender equitable mortgage at trial court – Application to tender at Court of Appeal – Power of Court of Appeal – Order 1 rule 19(2) Court of Appeal Rules, 2002 First Bank of Nigeria Plc v. Jibo [2004 – 2006] 13 N.B.L.R. (Part II) 453

BANKING Account – Partnership account – Mandate thereon – Two parties to sign jointly – Duty of bank to comply Ndoma-Egba v. African Continental Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 143 Account – Payment into account of customer in a bank – Shortfall between what cashier paid in and amount credited to account by bank – How to resolve Daniel Holdings Ltd v. UBA Plc [2004 – 2006] 13 N.B.L.R. (Part II) 16 Banker and customer relationship – Negligence of bank in paying forged cheque – How determined – Duty of Court Ndoma-Egba v. African Continental Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 143 Banker/customer relationship – Jurisdiction of Federal High Court Continental Trust Bank Ltd v. Govt of Kogi State of Nig [2004 – 2006] 13 N.B.L.R. (Part II) 449 Banker/customer relationship – Whether Federal High Court has jurisdiction – Section 251(1)(d) Constitu- tion of the Federal Republic of Nigeria, 1999 NUC v. Societe Generale Bank (Nig) Ltd (No. 1) [2004 – 2006] 13 N.B.L.R. (Part II) 365 Banker/customer relationship – Whether within jurisdiction of Federal High Court – Section 250(1) 1979 Constitution amended by Decree No. 107 of 1993 xxv [2004 – 2006] 13 N.B.L.R. (PART II)

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NDIC v. O’Silvawax International Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 343 Bank in receivership – Whether can still charge interest on loans NNB International Bank Plc v. Triumph Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 193 Bills of exchange – “Without recourse” endorsed on bill – Implication of Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272 Bills of exchange – Drawer, acceptor and endorser of bills – Liabilities of – Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272 Bills of exchange – Liabilities of parties thereunder – De- termination of – Applicable law – Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272 Bills of exchange – Parties thereto – Who are? – Liabili- ties of – Section 30 Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272 Bills of exchange – Waiver or renunciation – Right of a holder under a bill – How done – Section 62 Bills of Exchange Act Cap 35 Laws of the Federation of Ni- geria, 1990 Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272 Cheques – Allegation by customer in pleadings that cheque forged because he did not sign cheque – Whether use of the word “forge” connotes “forgery” in a criminal offence – Burden of proof on customer – Whether beyond reasonable doubt – Sec- tion 138(1) Evidence Act Ndoma-Egba v. African Continental Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 143 Cheques – Forged cheque – Implication of – Negligence by bank in paying – How determined section 2 Bills xxvi [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Subject Matter

of Exchange Act Ndoma-Egba v. African Continen- tal Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 143 Drawdown – Meaning of Universal Trust Bank Nig. Ltd v. Ajagbule [2004 - 2006] 13 N.B.L.R. (Part II) 31 Foreign exchange – Approval slip – Significance of UBN Plc v. Omniproducts (Nigeria) Ltd [2004 - 2006] 13 N.B.L.R. (Part II) 470 Guarantee – Discharge of surety – Effect Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272 Immunity of Central Bank – Section 49(1) Banks and Other Financial Institutions Act No. 25 of 1991 – Whether sustainable under the Constitution of the Federal Republic of Nigeria, 1999 Macpepple v. Cen- tral Bank of Nigeria [2004 – 2006] 13 N.B.L.R. (Part II) 381 Indebtedness of customer – How proven Akanmu v. Co- operative Bank Plc [2004 - 2006] 13 N.B.L.R. (Part II) 124 Interest – Principles applicable African Continental Bank Plc v. Okorie [2004 - 2006] 13 N.B.L.R. (Part II) 204 Interest – Rate of – What determines – Section 15 Bank- ing Act Cap 28 Laws of the Federation of Nigeria, 1990 Onuselogu Ent. Ltd v. Afribank (Nig) Plc [2004 – 2006] 13 N.B.L.R. (Part II) 86 Interest – When claimable Int. Trust Bank Plc v. Kautal Hairu Co. Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 177 Interest rate – Bank rate issued by Central Bank of Nige- ria by circulars – Whether court to take judicial notice of – Need to lead evidence thereon Daniel Holdings Ltd v. UBA Plc [2004 – 2006] 13 N.B.L.R. (Part II) 16 xxvii [2004 – 2006] 13 N.B.L.R. (PART II)

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Interest rate – Claim to interest at “Prevailing rate” – Need to lead evidence thereon Daniel Holdings Ltd v. UBA Plc [2004 – 2006] 13 N.B.L.R. (Part II) 16 Interest rate – Customer alleging exorbitant interest rate receiving regular statement of account – Whether can sustain Thor Ltd v. First City Merchant Bank Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 1 Interest rate – Unilateral variation of by bank – Whether permissible Universal Trust Bank Nig. Ltd v. Ajag- bule [2004 – 2006] 13 N.B.L.R. (Part II) 31 Joint account – Mandate that both signatories to sign – Duty of bank to honour instructions – Extent of Ndoma-Egba v. African Continental Bank Plc [2004 - 2006] 13 N.B.L.R. (Part II) 143 Loan – Granted to a company – Director of company – Whether liable for Vibelko Nigeria Ltd v. NDIC [2004 – 2006] 13 N.B.L.R. (Part II) 256 Payment of money into account by customer – Proof of – How done Saleh v. Bank of the North Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 429 Statement of account – Allegation of manipulation – Cus- tomer receiving regular statement of account – Whether can sustain Thor Ltd v. First City Merchant Bank Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 1 Winding-up of bank – Petition – Who can present – Sec- tions 36, 38, 55 and 58 Banks and Other Financial In- stitutions Decree No. 25 of 1991 and section 410(b) Companies and Allied Matters Act Cap. 59 Laws of the Federation of Nigeria, 1990 NNB International Bank Plc v. Triumph Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 193 Wrongful dishonour of customers cheque – Measure of damages – Principles applicable Union Bank of Ni- geria Plc v. Chimaeze [2004 – 2006] 13 N.B.L.R. (Part II) 397 Bank – Winding-up of – Who can present petition – Sec- tions 36, 38, 55 and 58 Banks and Other Financial xxviii [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Subject Matter

Institutions Decree No. 25 of 1991 NNB Interna- tional Bank Plc v. Triumph Bank Plc [2004 – 2006] 13 N.B.L.R. (Part II) 193

EVIDENCE Of bank’s employee – Not around when the transaction done – Whether hearsay Saleh v. Bank of the North Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 429

FAILED BANKS TRIBUNAL Veil of incorporation – When to lift – Section 3(3)(b)(ii) Failed Banks Decree No. 18 of 1994 Vibelko Nigeria Ltd v. NDIC [2004 – 2006] 13 N.B.L.R. (Part II) 256

GARNISHEE Order – When final – When interlocutory UBN Plc v. Boney Marcus Ind. Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 113 Order absolute – When not to be made NUC v. Societe Generale Bank (Nig) Ltd (No. 2) [2004 – 2006] 13 N.B.L.R. (Part II) 492 Principles applicable UBN Plc v. Boney Marcus Ind. Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 113

INJUNCTION Applicant applying for interlocutory injunction – What to show Macpepple v. Central Bank of Nigeria [2004 – 2006] 13 N.B.L.R. (Part II) 381 Conditions for the grant of interlocutory injunction Macpepple v. Central Bank of Nigeria [2004 – 2006] 13 N.B.L.R. (Part II) 381

JURISDICTION Demurrer and jurisdiction – Where demurrer abolished – Whether application on jurisdiction can be filed without statement of defence Macpepple v. Central xxix [2004 – 2006] 13 N.B.L.R. (PART II)

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Bank of Nigeria [2004 – 2006] 13 N.B.L.R. (Part II) 381 Federal High Court – Banker/customer relationship – Whether within jurisdiction of Federal High Court – Section 230(1) 1979 Constitution amended by Decree No. 107 of 1993 NDIC v. O’Silvawax International Ltd [2004 – 2006] 13 N.B.L.R. (Part II) 343 Federal High Court – Banker/customer relationship – Federal High Court possessing Continental Trust Bank Ltd v. Govt. of Kogi State of Nig. [2004 – 2006] 13 N.B.L.R. (Part II) 449 Federal High Court – Banker/customer relationship – Whether Court has jurisdiction – Section 251(1)(d) Constitution of the Federal Republic of Nigeria, 1999 NUC v. Societe Generale Bank (Nig) Ltd (No. 1) [2004 – 2006] 13 N.B.L.R. (Part II) 365

MORTGAGE Equitable mortgage – Failure to tender at trial court – Ap- plication to Court of Appeal to receive in evidence – Guiding principles First Bank of Nigeria Plc v. Jibo [2004 – 2006] 13 N.B.L.R. (Part II) 453 Equitable mortgage – How to prove First Bank of Nige- ria Plc v. Jibo [2004 – 2006] 13 N.B.L.R. (Part II) 453 Power of sale – Exercise of – Mortgagor offering to pay mortgage debt before sale – Mortgagee refusing and going ahead with sale – Effect Nigerian Advertising Services Ltd v. UBA Plc [2004 – 2006] 13 N.B.L.R. (Part II) 95 Power of sale – When arises – Statutory notice – Sections 19(1) and 20 Conveyancing and Law Property Act, 1881 Wema Bank Plc v. Abiodun [2004 – 2006] 13 N.B.L.R. (Part II) 215 Power of sale – Whether mortgagee can be restrained Ni- gerian Advertising Services Ltd v. UBA Plc [2004 – 2006] 13 N.B.L.R. (Part II) 95 xxx [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Subject Matter

Sale of property – Notice not given – Whether sale vitiated Wema Bank Plc v. Abiodun [2004 – 2006] 13 N.B.L.R. (Part II) 215 Sale of property – Purchaser buying in good faith – Effect – Section 21 Conveyancing and Law of Property Act, 1881 Wema Bank Plc v. Abiodun [2004 – 2006] 13 N.B.L.R. (Part II) 215 Sales by Auction Law – Effect on mortgagee’s power of sale Wema Bank Plc v. Abiodun [2004 – 2006] 13 N.B.L.R. (Part II) 215

PRACTICE AND PROCEDURE Demurrer – Abolition of – Issue of jurisdiction – Whether can be raised without statement of defence Macpepple v. Central Bank of Nigeria [2004 – 2006] 13 N.B.L.R. (Part II) 381 Post judgment interest – Award of – Rate of – Section 17 Judgment Act, 1838 Daniel Holdings Ltd v. UBA Plc [2004 – 2006] 13 N.B.L.R. (Part II) 16 Undefended list – Defendant raising preliminary objection – Not filing notice of intention to defend – Court overruling objection – Effect NUC v. Societe Gener- ale Bank (Nig) Ltd (No. 1) [2004 – 2006] 13 N.B.L.R. (Part II) 365 Undefended list – Principles applicable NUC v. Societe Generale Bank (Nig) Ltd (No. 1) [2004 – 2006] 13 N.B.L.R. (Part II) 365

WORDS AND PHRASES Drawdown – Meaning of Universal Trust Bank Nig. Ltd v. Ajagbule [2004 – 2006] 13 N.B.L.R. (Part II) 31 Without recourse – Endorsed on bill of exchange – Mean- ing of Auto Import Export v. Adebayo [2004 – 2006] 13 N.B.L.R. (Part II) 272

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Page

A Abiodun v UBA Ltd (1997) 46 LRCN 1 31 Abubakar v The Government of Taraba State (1997) 51 LRCN 1479 31 ACB Plc v Haston (Nig) Ltd (1997) 8 NWLR (Part 515) 110 143 ACB v Gwagwada (1994) 5 NWLR (Part 342) 25 429 Adebanjo v Brown (1990) 3 NWLR (Part 141) 661 272 Adebayo v FCDA (1998) 6 NWLR (Part 552) 118 343 Adebayo v Ighodalo (1996) 38 LRCN 747; (1996) 5 NWLR (Part 450) 507 31 Adedeji & Sons Motors Ltd v Immeh (1996) 8 NWLR (Part 465) 240 31 Adegoke Motors Ltd v Adesanya (1989) 3 NWLR (Part 109) 250; (1989) 5 SCNJ 80 272 Adelaja v Alade (1999) 6 NWLR (Part 608) 544 143 Adelaja v Fanoiki (1990) 2 NWLR (Part 131) 137 31 Adesanya v Otuewu (1993) 1 NWLR (Part 270) 414 272 Adesanya v The President of the Federal Republic of Nigeria (1981) 2 NCLR 358 470 Adeyemi v Lan & Baker (Nig) Ltd (2000) 7 NWLR (Part 663) 33 256 Adeyemi v Opeyori (1976) 9 – 10 SC 31 381 Adigun v A-G of Oyo State (1987) 1 NWLR (Part 53) 678 177 Adimora v Ajufo (1988) 3 NWLR (Part 80) 1 256; 31; 470 Aeroflot Soviet Airline v UBA Ltd (1986) 3 NWLR (Part 27) 188 397; 429 xxxiii [2004 – 2006] 13 N.B.L.R. (PART II)

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African Petroleum v Owodunni (1991) 8 NWLR Part 210) 391 272 A-G of Bendel State v A-G of the Federation (1982) 3 NCLR 1 272 A-G of Ondo State v A-G of Ekiti State (2001) 17 NWLR (Part 743) 706 256 A-G of Osun State v International Breweries Plc (2001) 7 NWLR (Part 713) 647 381 A-G of Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255 16 A-G of the Federation v Alkali (1972) 12 SC 29 453 Agbaje v James (1967) NMLR 49 31 Agbanelo v Union Bank of Nigeria Ltd (2000) 7 NWLR (Part 666) 534 470 AIB v Lee and Tee Industries Ltd (2003) 7 NWLR (Part 819) 366 256 AIDC v Nigeria Liquified Natural Gas Ltd (2000) 4 NWLR (Part 653) 494; (2000) 2 SCNJ 119 272 Ajomale v Yaduat and another No. 1 (2003) FWLR (Part 182) 1902 381 Akalonu v Omokaro (2003) 8 NWLR (Part 821) 190 31 Akanmu v Adigun (1993) 7 NWLR (Part 304) 218 95 Akeredolu v Akinremi (1989) 3 NWLR (Part 108)164 16 Akinbode v Chief Registrar High Court of Oyo State and others (2003) 3 NWLR (Part 808) 585 343 Akinloye v Eyiyola (1968) NMLR 92 124, 143 Akinola v Oluwo (1962) 1 SCNLR 352 143; 429 Akinsanya v UBA Ltd (1986) 7 SC (Part 1) 233 113 Akintola v Anyiam (1961) All NLR 508 397 Akintunde v Ojiekere (1971) NMLR 91 31 Akor v Abu (1988) 3 NWLR (Part 85) 696 177 Akpabuyo Local Government v Duke (2001) 7 NWLR (Part 713) 557 177 xxxiv [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

Akpapuna v Nzeka II (1983) 2 SCNLR 1 272 Alao v Akanbi (1986) 5 NWLR (Part 46) 1043 453 Alfotrin Ltd v A-G of the Federation (1996) 9 NWLR (Part 475) 634 177 Alli v Adesinloye (2000) 7 CRCN; (2000) 6 NWLR (Part 660) 177 343 Allied Bank of Nigeria Plc v Akubueze (1997) 6 KLR 1202 397 Amadi v NNPC (2000) 10 NWLR (Part 674) 76 256 Amokeodo v IGP (1999) 6 NWLR (Part 607) 467; (2001) FWLR (Part 33) 344 256 Anaeze v Anyaso (1993) 5 NWLR (Part 291) 1 397 Anigboro v Sea Trucks (Nig) Ltd (1995) 6 NWLR (Part 399) 35 343 Ansaldo Nigeria Ltd v National Provident Fund Management Board (1993) 3 NWLR (Part 174) 392 365 Anyaebosi v RT Briscoe (Nig) Ltd (1987) 3 NWLR (Part 59) 84 429 AP Ltd v Owodunni (1991) 8 NWLR (Part 210) 391 272 Arinze v First Bank of Nig Ltd (2004) 5 SCNJ 183; (2004) 12 NWLR (Part 888) 663; (2004) 5 SC 160 272 Ariori v Elemo (1983) 1 SC 13; (1983) 14 NSCC 1; (1983) 1 SCNLR 1 272 Armels Transport Ltd v Transco (Nig) Ltd (1974) 11 SC 237 506 470 Aro v Aro (2000) 3 NWLR (Part 649) 443 31 Arowolo v Akapo (2003) 8 NWLR (Part 823) 451;

(2004) All FWLR (Part 208) 807 204 Arubo v Aiyeleru (1993) 3 NWLR (Part 280) 126 272 Asaboro v Aruwaji (1974) 1 All NLR (Part 1) 140 453 Ashubiojo v ACB (1966) 2 All NLR 203 397 xxxv [2004 – 2006] 13 N.B.L.R. (PART II)

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Atanda v Ajani (1989) 3 NWLR (Part 111) 511 31 Awolowo v Shagari (1979) 6 – 9 SC 51 256 Awoyoolu v Aro (2001) 21 WRN 41 397

Awuse v Odili (2003) 18 NWLR (Part 851) 116 256

B Bajoden v Iromwanimu (1995) 7 NWLR (Part 410) 655 95 Balogun v Akanji (1988) 1 NWLR (Part 70) 301 397 Balogun v National Bank of Nigeria Plc (1978) 3 SC 155 397 Balogun v UBA (1992) 6 NWLR (Part 247) 336 397 Bamayi v A-G of the Federation (2001) 90 LRCN 2738; (2001) 12 NWLR (Part 727) 468 31 Bamgbose v Jiaza (1991) 3 NWLR (Part 177) 64 31 Banque Del’ Afrique Occidentale v Habu, Iliasu and Savage, in re Northern Nigeria Marketing Board (1964) NNLR 30 492 Barclays Bank DCO v Baderinwa in Re LEDB (1962) 2 All NLR 28 492 Barclays Bank DCO v Hassan (1961) All NLR 836 1 Barje v Gunduma (2001) 13 NWLR (Part 731) 659 397 Bello v Kassim (1969) NMLR 148 397 Bello v NBN Ltd (1992) 6 NWLR (Part 246) 206 272 Benin Rubber Producers Ltd v Ojo (1997) 9 NWLR (Part 521) 388 31 Bi Zee Bee Hotels Ltd v Allied Bank (Nig) Ltd (1996) 8 NWLR (Part 465) 176 343 BON Ltd v Akorede (1995) 1 NWLR (Part 374) 736 215 BON Ltd v Idirisu (2000) 3 NWLR (Part 649) 373 31 xxxvi [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

BON Ltd v Yau (2001) 5 SCNJ 168; (2001) 10 NWLR (Part 721) 408 272 Boshali v Allied Commercial Exporters Ltd (1961) 2 SCNLR 322 272 British Bata Shoe Ltd v Melikian (1956) NSCC 91; (1956) SCNLR 321 215 Bronik Motors Ltd v Wema Bank Ltd (1983) 1 SCNLR 296 343 Buba v The State (1994) 7 NWLR (Part 355) 195 397 Buhari v Obasanjo (2003) 15 NWLR (Part 843) 236 256 Buhari v Yusuf (2003) 14 NWLR (Part 841) 446 256 Busari v Oseni (1992) 4 NWLR (Part 237) 557 31 C Calabar East Co-op v Ikot (1999) 14 NWLR (Part 638) 225 31 Carribean Trading & Fidelity Corporation v NNPC (1992) 7 NWLR (Part 252) 161 272 CBN v Adedeji (2004) 13 NWLR (Part 890) 226 492 CBN v Ozigi (1994) 3 SCNJ 42 204 CCB (Nig) Plc v Ozubu (1998) 3 NWLR (Part 541) 290 343 Cheko v Kano Authority (1966) NMLR 378 470 Chinwendu v Mbamali (1980) NSCC 128 272 Chukujekwu v Olarele (1992) 2 NWLR (Part 221) 80 31 Coker v Sanyaolu (1976) 9 – 10 SC 203 215 Co-operative Bank Ltd v Obokhare (1996) 8 NWLR (Part 468) 579 256 D De Lluch v Societe Bancaire (Nig) Ltd (2003) 15 NWLR (Part 842) 1 343 Daniyan v Iyagin (2002) 7 NWLR (Part 760) 345 397 Daniyan v Iyagin (2002) 8 WRN 44 397 DB Financial Services Ltd v Adesola (2000) 8 NWLR (Part 668) 170 256 xxxvii [2004 – 2006] 13 N.B.L.R. (PART II)

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Debs v Cheko (Nig) Ltd (1986) 3 NWLR (Part 32) 846 429 Densy Ind (Nig) Ltd v Uzokwe (1999) 2 NWLR (Part 591) 392 397 Dongtoe v Civil Service Commission Plateau State (2001) 9 NWLR (Part 717) 132 381 Duriminiya v Commissioner of Police (1961) NNLR 70 143 Duyile and another v Ogunbayo & Sons Ltd (1988) 1 NSCC (Vol 19) 385 31 E Ebba v Ogodo (2000) FWLR (Part 27) 2094; (1984) 1 SC 372 429 Ebo v Nigerian Television Authority (1996) 4 NWLR (Part 442) 314 31 Eboh v Akpotu (1968) NMLR 278 397 Eboni Finance & Securities Ltd v Wole-Ojo Tech- nical Services Ltd (1996) 7 NWLR (Part 461) 464 272 Ebueku v Amola (1988) 3 SCNJ (Part II) 207; (1988) 2 NWLR (Part 75) 128 31 Egbe v Adefarasin (1985) 1 NWLR (Part 3) 549 343, 470 Egbunike v ACB (1995) 27 LRCN 219 397 Egonu v Egonu (1978) 11 - 12 SC 111 470 Eke v Okwaranya (2001) 20 WRN 132 397 Eke v Okwaranyia (2001) 12 NWLR (Part 726) 181 397 Ekpan v Uyo (1986) 3 NWLR (Part 26) 63 16 Ekpe v Fagbemi (1978) All NLR 107; (1978) 3 SC 209 31 Ekretsu v Oyobebere (1992) 9 NWLR (Part 266) 438 256 Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) 422 16; 177 ELF (Nig) Ltd v Sillo (1994) 6 NWLR (Part 350) 258 397 Elias v Omo-Bare (1982) 1 All NLR 70 143 xxxviii [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

Elike v Nwakwoala (1984) 12 SC 301 453 Eliochin (Nig) Ltd v Mbadiwe (1986) 1 NWLR (Part 14) 47 31 Emegokwue v Okadigbo (1973) 4 SC 113 272; 31 397; Enang v Adu (1981) 11 SC 25 272; 95 Eriobona v Obiora (1999) 8 NWLR (Part 616) 622 177 Eze v A-G of Rivers State (2001) 13 NWLR (Part 746) 381 Eze v Federal Republic of Nigeria (1987) 1 NWLR (Part 51) 506 31 Eze v Okechukwu (2002) 12 SCNJ 258; (2002) 18 NWLR (Part 799) 348 272 Ezeani v Ejidike (1964) 1 All NLR 402 31; 470 Ezekwesili v Agbapuonwu (2003) 9 NWLR (Part 827) 337 397; 429 Ezeonwu v Onyechi (1996) 3 NWLR (Part 438) 499 143 Ezomo v Oyakhire (1985) 1 NWLR (Part 2) 195 272 F Fadare v A-G of Oyo State (1982) 4 SC 1 272 Fasade v Babalola (2003) 4 SCNJ 287; (2003) 11 NWLR (Part 830) 26 272 Fasikun II v Oluronke 11 (1999) 2 NWLR (Part 581) 1 470 FATB Ltd v Partnership Investment Co Ltd (2003) 18 NWLR (Part 851) 35 31; 272 Fawehinmi Construction Co Ltd v Obafemi Awolowo University (1998) 5 SCNJ 44; (1998) 6 NWLR (Part 553) 171 177; 272 FBN Plc v Jimiko Farms Ltd (1997) 5 NWLR (Part 503) 81 343 FBN v Uwada (2003) 2 NWLR (Part 805) 485 204 FCDA v Naibi (1990) 3 NWLR (Part 138) 270 272 FDB Financial Services Ltd v Adesola (2003) 8 NWLR (Part 668) 170 256 FHA v Sommer (1986) 1 NWLR (Part 17) 533 272 xxxix [2004 – 2006] 13 N.B.L.R. (PART II)

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Financial Merchant Bank Ltd v NDIC (1995) 6 NWLR (Part 400) 226 193 Finnih v Imade (1992) 1 NWLR (Part 219) 511 256 FMBN Ltd v Desire Gallery Ltd (2004) 13 NWLR (Part 891) 522 492 FMF Ltd v Ekpo (2004) 2 NWLR (Part 856) 100 31 Fortune International Bank Plc v Pegasus Trading Office (2004) 1 SCNJ 292; (2004) 1 SC (Part 11) 164; (2004) 4 NWLR (Part 863) 369 272 G Garba v Federal Civil Service Commission (1988) LRCN 3485; (1989) 1 NWLR (Part 71) 449 31 Gbajor v Ogunburegui (1961) All NLR 853 31 George v Dominion Flour Mills Ltd (1963) 1 SCNLR 117 124; 272 GMBU v Rivway Lines Ltd (1998) 58 LRCN 3485 31 Grand Cereals and Oil Mills Ltd v As-Ahel Intl Marketing and Procurement Ltd (2000) 4 NWLR (Part 652) 310 365 Guinness Nigeria Plc v Nwoke appeal no. CA/B/252/98 397 Gurara Securities & Finance Ltd v TIC Ltd (1999) 2 NWLR (Part 589) 29 272 H Himma Merchant Ltd v Aliyu (1994) 5 NWLR (Part 347) 667 177 Ham Idu v Sahar Ventures Ltd (2004) 7 NWLR (Part 873) 618 31 Hashidu v Goje (2003) 15 NWLR (Part 843) 352; (2004) All FWLR (Part 228) 662 204 Haway v Mediowa (Nig) Ltd (2000) 13 NWLR (Part 683) 77 31 Holec Projects (Nig) Ltd v Dafeson International Ltd (1999) 6 NWLR (Part 607) 490 343 Honika Sawmill Nig Ltd v Hoff (1994) 2 NWLR (Part 326) 252 95 xl [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

I Ibile Holdings Ltd v PDSS (2002) 16 NWLR (Part 792) 117 31 Ibodo v Enarofia (1980) NSCC 195; (1980) 5 - 7 SC 42 397; 272 Ibrahim v Ojomo (2004) 4 NWLR (Part 862) 89 31 Idika v Erisi (1988) 2 NWLR (Part 78) 563 31 Idonidoye-Obu v NNPC (2003) 2 NWLR (Part 805) 589 31 Ifeanyichukwu Osondu Co Ltd v Akhigbe (1999) 1 NWLR (Part 675) 1 397 Ifezue v Mbadugba (1984) SCNLR 427 256 Igbodin v Obianke (1976) 9 – 10 SC 179 429 Igwe v AICE (1994) 8 NWLR (Part 363) 459 272 Ijale v A-G, Leventis (1961) All NLR 792; (1961) 2 SCNLR 386 215 Ijebu Ode Local Govt. v Adedeji Balogun and Co. Ltd (1991) 1 NWLR (Part 166) 136 470; 397 Ike v Ugbaja (1993) 6 NWLR (Part 301) 539 397 Ikenye v Ofune (1985) 2 NWLR (Part 5) 1 143 Ikoku v Oli (1962) 1 SCNLR 307 143 Imana v Robinson (1979) 3 – 4 SC 1 397 Insurance Brokers of Nigeria v ATM Co Ltd (1996) 8 NWLR (Part 466) 316 95 International Messengers (Nig) Ltd v Pegofor Industries Ltd (2005) 15 NWLR (Part 947) 1 470 Inyang v Ebong (2002) 2 NWLR (Part 751) 284 31 Ishola v Ajiboye (1998) 1 NWLR (Part 532) 71 31 Ishola v SGB (Nig) Ltd (1997) 2 NWLR (Part 488) 405 429 Ivienagbor v Bazuaye (1999) 9 NWLR (Part 620) 552 31 Iwego v Ezeugo (1992) 6 NWLR (Part 249) 561 397 Iwuoha v NIPOST (2003) 4 SC (Part 11) 37; (2003) 8 NWLR (Part 822) 308 215; 31 xli [2004 – 2006] 13 N.B.L.R. (PART II)

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J Jammal Steel Structures Ltd v ACB Ltd (1973) 1 All NLR (Part 2) 208 343 Jinadu v Esurombi-Aro (2005) All FWLR (Part 251) 349; (2005) 14 NWLR (Part 944) 142 204 Jobi v Oshilaja (1963) 1 SCNLR 31 143 Joe Goldy Co Ltd v CDB Plc (2003) 5 NWLR (Part 814) 586 397 Jos Steel Rolling Co Ltd v Benestielli Nig Ltd (1995) 8 NWLR (Part 412) 201 177 Julius Berger (Nig) Plc v Omogui (2001) 15 NWLR (Part 736) 401 343 K Kamalu v Umunna (1997) 5 NWLR (Part 505) 321 31 Kara v Wassah (2001) 18 NWLR (Part 744) 117 31 Kate Enterprises v Daewoo (Nig) Ltd (1985) 2 NWLR (Part 5) 116 429 Kezie v Iwuoha (1998) 8 NWLR (Part 563) 554 397 Kokoro Owo v Lagos State Government (1995) 6 NWLR (Part 404) 760 343 Kolo v Plc (2003) 3 NWLR (Part 806) 216 343 Kosile v Folarin (1989) 3 NWLR (Part 107) 1 16 Koya v UBA Ltd (1997) 1 NWLR (Part 481) 251; (1997) 46 LRCN 1 31 L Laguro v Toku (1992) 2 NWLR (Part 223) 278 272 Lawal v Adekoya (1974) 6 SC 83 397 Lawal v Dawodu (1972) 8 – 9 SC 83 429 Lawal v Oke (2001) 7 NWLR (Part 711) 88 256 Lewis & Peat v Akhimien (1976) 7 SC 157; (1976) 1 All NLR (Part 1) 460 272; 397 Lokoyi v Olojo (1983) 2 SCNLR 127 16; 95 xlii [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

M Macaulay v NAL Merchant Bank Ltd (1990) 4 NWLR (Part 144) 283 1 Madukolu v Nkemdilim (1962) 1 All NLR 581; 215; 365; (1962) 2 SCNLR 341 381 Mainagge v Gwamna (2004) 7 SCNJ 361; (2004) 7 SC (Part 11) 86; (2004) 14 NWLR (Part 893) 323 272 Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR (Part 524) 198 215 Mark v Eke (2004) 1 SC (Part 11) 1; (2004) 5 NWLR (Part 865) 54 215 Maximum Insurance Co Ltd v Owoniyi (1994) 3 NWLR (Part 331) 194 256 Mazin Engineering Ltd v Tower Aluminum (1993) 5 NWLR (Part 295) 526 470 Mercantile Bank of Nigeria Plc v Nwobodo (2000) 3 NWLR (Part 648) 297 31 Mikailu v The State (2001) 8 NWLR (Part 715) 469 177 Mogaji v Odofin (1978) 4 SC 91 429 Mohammed v Klargester (Nig) Ltd (2002) 14 NWLR (Part 787) 335 31 Mojekwu v Iwuchukwu (2004) 4 SCNJ 180; (2004) 11 NWLR (Part 883) 196 272 Mosheshe General Merchants Ltd v Nigeria Steel Products Ltd (1987) 2 NWLR (Part 55) 110 453 N National Ports Authority v Eyamba (2005) 12 NWLR (Part 939) 409 365 NBC Plc v Borgundo (1992) 2 NWLR (Part 591) 408 397 NBN Ltd v Opeola (1994) 1 NWLR (Part 319) 126 31 Ndaeyo v Ogunnaya (1977) 1 SC 11 215 Ndayako & Jikantoro v Dantoro (2004) 5 SC (Part II) 1; (2004) 13 NWLR (Part 889) 187 272 NDIC v Akahall Ltd (2003) 31 WRN 125 492 xliii [2004 – 2006] 13 N.B.L.R. (PART II)

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NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107 365; 449 Ngige v Capital Bancorp Ltd (1999) 7 NWLR (Part 609) 71 215 Niger Construction Ltd v Okugbemi (1987) 11 – 12 SCNJ 133; (1987) 4 NWLR (Part 67) 787 31; 272 Niger Progress Ltd v NEL Corporation (1989) 3 NWLR (Part 107) 68 31 Nigeria Bank for Commerce and Industry v Inte- grated Gas (Nig) Ltd (1998) 8 NWLR (Part 613) 119 397 Nigerian Housing Dev Society Ltd v Mumuni (1977) NCLR 241 215 Nigerian Housing Development Society v Mumuni (1977) 2 SC 57 95 Nigerian Industrial Development Bank Ltd v Fem- bol (Nig) Ltd (1997) 2 NWLR (Part 489) 543 343 NIPOST v Adepoju (2003) 5 NWLR (Part 813) 224 343 Nishizawa Ltd v Jethwani (1984) 12 SC 234 1 Nkpedem v Udo (2000) 9 NWLR (Part 673) 631 31 Nsirim v Nsirim (2002) 94 LRCN 117; (1990) 11 NWLR (Part 138) 285 31 Nwadiaro v SPDC Ltd (1990) 5 NWLR (Part 150) 322 272 Nwobodo v Onoh (1984) 1 SCNLR 1 143 Nwosu v Imo State Environmental Sanitation Authority (1990) 2 NWLR (Part 135) 688 256 O OAA Co-op Society v NACB Ltd (1999) 2 NWLR (Part 590) 234 Oamen v Owenan (1993) 8 NWLR (Part 311) 358 343 Oasazuwa v Edo State Civil Service Commission (1999) 4 NWLR (Part 597) 155 124 Obasanjo v Buhari (2003) 17 NWLR (Part 850) 510 31 Obiefuna v Okoye (1961) 1 All NLR 357 343 xliv [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 31; 124 Obijuru v Ozims (1985) 2 NWLR (Part 6) 167 256 Obmiami Brick & Stone Nig Ltd v ACB Ltd (1992) 3 NWLR (Part 229) 260 95 Odiase v Omele (1985) 3 NWLR (Part 11) 82 453 Odiba v Azege (1998) 61 LRCN 4605; (1998) 9 NWLR (Part 566) 370 31 Odogu v A-G of the Federation (1996) 40/4 LRCN 1454; (1996) 6 NWLR (Part 456) 508 31 Odoho v Task Force Hospital Management (2004) 5 NWLR (Part 867) 627 492 Odua Inv Co Ltd v Talabi (1997) 10 NWLR (Part 523) 1 272 Odulaja v Haddad (1973) 11 SC 357 31 Odum v Chinwo (1978) 6 - 7 SC 251 470 Odumosu v ACB (1976) 11 SC 55; (1988) 1 NWLR (Part 72) 601 31 Odutola v Oderinde (2004) All FWLR (Part 217) 615; (2004) 12 NWLR (Part 888) 574 113 Ogbani v Oti (2000) 8 NWLR (Part 670) 582 365 Ogbodu v Quality Finance Co Ltd (2003) 6 NWLR (Part 815) 147 256; 397 Ogboru v Ibori, a decision of the Court of Appeal, Benin Division on 13/7/05 272 Ogbu v Ani (1994) 7 NWLR (Part 355) 128 429 Oguchi v FMB Nigeria Ltd (1990) 6 NWLR (Part 156) 330 215 Ogunsola v Usman (2003) FWLR (Part 180) 1465 381 Ojegbe v Omotsone (1996) 6 NWLR (Part 608) 591 31 Ojo v Victino Fixed Odds Ltd (2000) 9 NWLR (Part 673) 647 31 Ojomu v Ajao (1983) 2 SCNLR 156 16 Okechukwu v Etukokwu (1998) 8 NWLR (Part 562) 513 343 Okechukwu v Ndah (1967) NMLR 368 31 Okeke v Aondoakaa (2000) 9 NWLR (Part 673) 501 31 xlv [2004 – 2006] 13 N.B.L.R. (PART II)

Nigerian Banking Law Reports

Okochi v Animikwoi (2004) 114 LRCN 2924 31 Okolo v Union Bank (2004) 1 SC (Part 1) 1; (2004) 3 NWLR (Part 859) 87 215 Okonkwo v Ogbogu (1996) 37 LRCN 580; (1996) 5 NWLR (Part 449) 420 31 Okoro v Okoro (1998) 3 NWLR (Part 540) 65 177 Okoroji v Enumah (1961) All NLR 191 397 Okoronkwo v Chukwueke (1992) 1 NWLR (Part 216) 175 31 Okoya v Santilli (1994) 4 NWLR (Part 338) 256 429 Okpanum v SGE (Nig) Ltd (1998) 7 NWLR (Part 559) 537 453 Okumagba v Esisi (2005) 4 NWLR (Part 916) 501 453 Okwunakwe v Opara (2000) 14 NWLR (Part 687) 334 215 Oladoye v Mil Administrator, Osun State (1996) 12 SCNJ 192; (1996) 10 NWLR (Part 476) 38 272 Olagunyi v Oyeniran (1996) 6 NWLR (Part 453) 127 95 Olale v Ekwelendo (1989) 4 NWLR (Part 115) 326 397 Olatunde v Obafemi Awolowo University (1998) 5 NWLR (Part 567) 178; (1998) 4 SCNJ 59 272 Olowu v Olowu (1985) 3 NWLR (Part 13) 372 31 Olujinle v Adeagbo (1998) 4 SCNJ 1; (1988) 2 NWLR (Part 75) 238 31 Omoboriowo v Ajasin (1984) 1 SCNLR 108 143 Omonuwa v Oshodin (1985) 2 SC 1 113 Omotayo v Nigerian Railway Corporation (1992) 7 NWLR (Part 254) 471 343 Oniya v Okoliko (1992) 7 NWLR (Part 254) 500 397 Onjewu v Kogi State Ministry of Commerce and Industry (2003) 10 NWLR (Part 827) 40 492 Onuigbo v Nwekeson (1993) 3 NWLR (Part 238) 544 397 Onwujoba v Obienu (1991) 1 NSCC 494 397 Onwukeme v Onwukeme (1971) NNLR 10 492 xlvi [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

Onyenucheya v Mil Adm, Imo State (1997) 1 NWLR (Part 482) 429 343 Onyero v Nwadike (1996) 9 NWLR (Part 471) 231 256 Oriental Airlines Ltd v Air Via Ltd (1998) 12 NWLR (Part 577) 271 193 Orizu v Anyaegbunam (1978) 5 SC 21; (1978) 1 LRN 216 453 Oshinjinrin v Elias (1970) All NLR 153 31 Osho v Foreign Finance Corp (1991) 4 NWLR (Part 184) 157 16 Oshodi v Eyifunmi (2000) 13 NWLR (Part 684) 298 31 Osolu v Osolu (2003) 6 SC (Part 1) 1; (2003) 11 NWLR (Part 832) 608 215 Osuji v Isiocha (1989) 3 NWLR (Part 111) 623 16; 31 Osun State Govt v Dalami (Nig) Ltd (2003) 7 NWLR (Part 818) 72 204 Otpo v Sunmonu (1987) 2 NWLR (Part 58) 587 177 Overseas Construction Co Ltd v Creek Enter- prises Ltd (1985) 3 NWLR (Part 13) 406 31; 16 Owena Bank (Nig) Plc v Punjab National Bank (2000) 5 NWLR (Part 658) 635 343 Oyeyiola v Adeoti (1973) 1 NMLR 103 470 P Pan Atlantic Shipping and Transport Agencies Ltd v Rhein Mass GMBH (1997) 3 NWLR (Part 493) 248 1 Peterside v IMB (Nig) Ltd (1993) 2 NWLR (Part 278) 712 343 R Ransome Kuti v A- G of the Federation (1985) 2 NWLR (Part 6) 211 124 RCC (Nig) Ltd v Edomwonyi (2003) 4 NWLR (Part 811) 513 31 Rean Ltd v Aswani Textile Industries (1991) 2 NWLR (Part 176) 639 272 xlvii [2004 – 2006] 13 N.B.L.R. (PART II)

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Remalo Ltd v NBN Ltd (2003) 16 NWLR (Part 846) 235 204 Rockonoh Property Co Ltd v Nig Telecommunica- tions Plc (2001) 89 LRCN 2602; (2001) 14 NWLR (Part 733) 468 31 Royal Exchange Assurance (Nig) Ltd v Aswani Textiles Ltd (1992) 3 NWLR (Part 227) 1; (1992) 2 SCNJ 346 272 S Sabru Motors (Nig) Ltd v Rajab Enterprises (Nig) Ltd (2002) FWLR (Part 116) 841 397 Saeby Jerstober Maskinfabrk A/S v Olaogun En- terprises Ltd (1999) 14 NWLR (Part 637) 128 177 Salawal Motor House Ltd v Lawal (1999) 9 NWLR (Part 620) 692 272 Saliba v Yassin (2002) 13 WRN 59 397 Sanusi Bros (Nig) Ltd v Cotia CEISA (2000) 11 NWLR (Part 679) 566 1 Saraki v Kotoye (1990) 4 NWLR (Part 143) 144; (1990) 6 SCNJ 31 272 Savage v Uwaechia (1972) 1 All NLR 251 470 Savannah Bank (Nig) Ltd v Pan Atlantic Shipping & Trans Agencies (1987) 1 NWLR (Part 49) 212 470 Savannah Bank of Nigeria Plc v NDIC (2004) 11 NWLR (Part 883) 60 492 Schiffahrakontor GMBH v Railway Lines Ltd (1998) 4 KLR (Part 61) 769 470 Sea Trucks (Nig) Ltd v Pyne (1999) 6 NWLR (Part 607) 514 343 Sha (Jnr) v Kwan (2000) 8 NWLR (Part 670) 685 31 Shylion v Aseiw (1994) 6 NWLR (Part 353) 670 177 Sodipo v Lemninkainem OY (1986) 1 NWLR (Part 15) 220 1 Sokoto Local Govt v Amale (2001) 8 NWLR (Part 714) 224 343 xlviii [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

Standard Bank Nigeria Ltd v Ikomi (1972) 1 All NLR (Part 1) 4 215 STB Ltd v Contract Resources Ltd (No. 1) (2001) FWLR (Part 72) 1992 492 Strabag Contruction (Nig) Ltd v Ogarekpe (1991) 1 NWLR (Part 170) 733 397 T Tate Ind Plc v Devcom Merchant Bank Ltd (2004) 17 NWLR (Part 901) 182 193 Techno v Njoku (2001) 52 WRN 177 397 Temco Engineering and Co. Ltd v SBN Ltd (1995) 5 NWLR (Part 397) 607 95 Tewogbade v Akande (1968) NMLR 404 397 Thomas v Olufosoye (1986) 1 NWLR (Part 18) 669 470 Thor Ltd v FCMB Ltd (2003) 4 NWLR (Part 652) 274 31 Total Nig Plc v VIIRA (2004) 7 NWLR (Part 873) 446 381 Total Nigeria v Morkah (2002) 9 NWLR (Part 773) 492 31 Trade Bank Plc v Chami (2003) 13 NWLR (Part 836) 158 272 U UBN Ltd v Ademuyiwa (1999) 11 NWLR (Part 628) 570 397 UBN Ltd v Nwoye (1996) 35 LRCN 232 397 UBN Ltd v Odusote Book Stores Ltd (1996) 42 LRCN 1639; (1996) 9 NWLR (Part 421) 558 31 UBN Ltd v Ozigi (1994) 3 NWLR (Part 333) 385 31 UBN Ltd v Penny-Mart Ltd (1992) 5 NWLR (Part 240) 228 256 UBN Ltd v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150 31 UBN Plc v Bonny Marcus Industry Ltd (2005) 13 NWLR (Part 943) 654 492 xlix [2004 – 2006] 13 N.B.L.R. (PART II)

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UBN Plc v Jeric (Nig) Ltd (1998) 2 NWLR (Part 536) 63 397 UBN v Dawodu (2003) 4 NWLR (Part 810) 287 256 UBN v Fajebe Foods Ltd (1998) 6 NWLR (Part 554) 380 31 Udechukwu v Onwuka (1956) SCNLR 189 16 Udengwu v Uzuegbu (2003) 13 NWLR (Part 836) 136 31 Uka v Irolo (1996) 4 NWLR (Part 441) 218 343 Ume v Okoronkwo (1996) 12 SCNJ 404; (1996) 10 NWLR (Part 477) 133 272 Union Bank Ltd v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150 Union Bank of (Nig) Plc v Intergrated Timber and Plywood Producers Ltd (2000) 12 NWLR (Part 680) 99 343 Union Bank of Nigeria v Nwoye (1996) 3 LRCN 232 397 Union Beverages Ltd v Owolabi (1988) 1 NWLR (Part 68) 128 16 Usman v Baba (2005) 5 NWLR (Part 917) 113 381 Usman v Garke (2003) 7 SCNJ 38; (2003) 14 NWLR (Part 840) 261 272 Uwa Printer Ltd v Investment Trust Co Ltd (1988) 12 SCNJ (Part 1) 102 397 Uzoukwu v Ezeonu II (1991) 6 NWLR (Part 200) 708 343 W Wema Bank Plc v Merchant Bank of Africa FHCLR (1996) 687 193 Western Steel Works Ltd v Iron and Steel Workers Union (1986) 3 NWLR (Part 30) 617 113 Wilcox v Queen (1961) 2 SCNLR 296 143 Wilson v Oshin (2000) FWLR (Part 14) 2311; (2000) 9 NWLR (Part 673) 442 204 Woluchem v Gudi (1981) 5 SC 291 397; 429; 31 l [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Cases Referred to

Y Yassin v Barclays Bank DCO (1968) NMLR 380 124 Yau v City Security Ltd (2003) FWLR (Part 165) 498 365 Yesufu v ACB Ltd (1976) All NLR 328 124 Yoye v Olubode (1974) 10 SC 209 272

INDEX OF FOREIGN CASES REFERRED TO

Page A Anglo-Italian Bank v Wells (1878) 38 LTR 197 1 Arab Bank v Ross (1952) QBD 216 143 B Bassil v Honger 14 WACA 569 215 Bell v Holmes [1956] 3 All ER 449 215 Blakey v Latham (1889) 43 Ch D 25 113 Bozson v Altrinchan Urban District Council [1903] 1 KB 547 113 Bradlaugh v Clarke (1883) 8 APP case 354 215 C Catlin v Cyprus Finance Corporation (London) Ltd [1983] 1 All ER 809 143 Charterhouse Credit Co Ltd v Tolly [1963] 2 All ER 432 272 Choice Investments Ltd v Jeronmimon (Midland Bank Ltd, Garnishee) [1981] 1 All ER 225 113 F Fidelitas Shipping Co Ltd v V/O Exportchleb (1966) 1 QB 630 d 640 215 Fullers Theatre and Vaudeville Co. Ltd v Rofe (1923) AC 435 (PC) 272 G Gibbons v West Minster Bank Ltd [1939] 3 All ER 577 397 H Henderson v Henderson (1843) 3 Hare 104; 67 ER 313 215 liii [2004 – 2006] 13 N.B.L.R. (PART II)

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Hunter v Steward (1861) 4 De GF& J 168; 45 ER 1148 215 K Karsales (Harrow Ltd) v Wallis [1956] 2 All ER 866 272 Knowles v Roberts (1888) 38 Ch D 263 215 L Ladd v Marshall [1954] 3 All ER 745 453 Lady Anne Tenant v Associated Newspapers (1979) 5 Fleet Street Reports 298 1 Lever Brothers Ltd v Bell (1931) 1 KB 557 272 Lord Denning in Macfoy v UAC (1962) AC 152 215 M Matthews v Smallwood (1910) 1 Ch 777 272 May v Chidley (1894) 1 QB 451 1 Mc Call Brothers Ltd v Hargreaves [1932] 2 KB 423 272 McDonald v Nash (1924) AC 625 272 N National Sales Corporation v Bernardi [1931] 2 KB 188 272 North-Western Salt Company Ltd v Electro Lytic Alkali Co Ltd [1913] 3 KB 422 272 O Ord v Ord [1923] 2 KB 432 215 P Prelin v Royal Bank of Liverpool (1870) LRSFS 92; (1870) LR 5 Exch 31 Philips v Britannia Hygienic Laundry Co Ltd [1923] 2 KB 832 215 Plymouth Corporation v Hurrell (1869) 20 LT 473; (1968) 1 QB 455 215 R Re City Equitable Inc Co (1925) CR 407 256 liv [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Foreign Cases Referred to

Re George Francis v Bruce (1890) 44 Ch D 627 272 Re Patrick & Lyon Ltd (1933) Ch 786 256 Re Vandervell’s Trusts No (2) [1974] 3 All ER 205 272 Rimal v Carthwright (1924) WN 229 (CA) 272 Roe v R McGregor & Sons (1968) 1 WLR 925 453 Ross T Smith & Co Ltd v TD Bailey Son & Co [1940] 3 All ER 60 272 S Salaman v Warner (1891) 1 QBD 734 113 Salomon v Salomon [1897] AC 22 31 Selwyn v Garfit (1888) 38 Ch D 273 272 Serbeh v Karikan (1939) 5 WACA 34 272 Shaw v Shaw (1954) 2 QB 429 272 Smyth Ross J & Co Ltd v Banley, Sons & Co [1940] 3 All ER 60 272 State v MCtaque (1927) 173 MIN 153 272 Suisse Atlantique Societe D‘armament Maritime SA v N V Rotterdamsche Kolen Centrale (1967) 1 AC 361 272 T Thoday v Thoday (1964) P 181; [1964] 1 All ER 341 215 Tsakiroglon & Co Ltd v Noblee & Thorl GMBH (1961) 2 All ER 179 470 V Vivyan v Vyan 30 Beav 65; 54 ER 817 272 Z Ziks Press Ltd v Alvan Ikoku 14 WACA 188 397

INDEX OF NIGERIAN STATUTES REFERRED TO

Actions Law Cap 3 Laws of Anambra State, 1986 s 20(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 470

Arbitration and Conciliation Act Cap 19 Laws of the Federation of Nigeria, 1990 s 1 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 s 2 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 s 3 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 s 4 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 s 5 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 First Schedule....[2004 – 2006] 13 N.B.L.R. (PART II) 86 art 3 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 art 18(1)...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 art 18(2)...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 art 19(1)...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 art 19(2)...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 art 31 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86 art 32 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 86

Banking Act Cap 28 Laws of the Federation of Nigeria, 1990 s 15...... [2004 – 2006] 13 N.B.L.R. (PART II) 204

Banks and Other Financial Institution Decree No. 25 of 1991 s 12...... [2004 – 2006] 13 N.B.L.R. (PART II) 492 s 15...... [2004 – 2006] 13 N.B.L.R. (PART II) 492 s 15(6)(b) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 492 s 16...... [2004 – 2006] 13 N.B.L.R. (PART II) 492 s 32...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 33...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 34...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 lvii [2004 – 2006] 13 N.B.L.R. (PART II)

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Banks and Other Financial Institution Decree No. 25 of 1991 – continued s 36...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 37(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 38...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 38(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 40...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 55(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 193

Banks and Other Financial Institutions Act Cap B3 Laws of the Federation of Nigeria, 2004 s 29(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 s 49(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 381

Bills of Exchange Act, 1882 s 24...... [2004 – 2006] 13 N.B.L.R. (PART II) 143

Bills of Exchange Act Cap 21 Laws of the Federation of Nigeria, 1958 s 27(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 30(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 30(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 38(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 55(2)(a)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 55(2)(b)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 55(2)(c)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 56...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 59 – 64...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 62...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 62(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 62(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272

Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 s 16(a) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 16(b) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 lviii [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Statutes referred to

Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 – continued s 30...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 54(a) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 54(b)(i)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 54(b)(ii) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 54(b)(iii) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 55(1)(a)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 55(1)(b)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272 s 55(2)(c)...... [2004 – 2006] 13 N.B.L.R. (PART II) 272

Companies and Allied Matters Act Cap 59 Laws of the Federation of Nigeria, 1990 s 38(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 343 s 77...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 409...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 409(a) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 410...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 410(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 410(1)(a)...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 410(1)(b)...... [2004 – 2006] 13 N.B.L.R. (PART II) 193 s 417...... [2004 – 2006] 13 N.B.L.R. (PART II) 492 s 454...... [2004 – 2006] 13 N.B.L.R. (PART II) 492

Constitution of the Federal Republic of Nigeria, 1979 as amended by Decree No. 107 of 1993 s 40(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 343 s 42(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 343 s 219...... [2004 – 2006] 13 N.B.L.R. (PART II) 215 s 230(1)(d)...... [2004 – 2006] 13 N.B.L.R. (PART II) 343 s 236...... [2004 – 2006] 13 N.B.L.R. (PART II) 215 s 239...... [2004 – 2006] 13 N.B.L.R. (PART II) 215

Constitution of the Federal Republic of Nigeria, 1999 s 6(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 s 6(6) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 lix [2004 – 2006] 13 N.B.L.R. (PART II)

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Constitution of the Federal Republic of Nigeria, 1999 – continued s 44(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 343 s 70...... [2004 – 2006] 13 N.B.L.R. (PART II) 215 s 240...... [2004 – 2006] 13 N.B.L.R. (PART II) 215 s 251(1)(d)...... [2004 – 2006] 13 N.B.L.R. (PART II) 343; 365 s 251(1)(q)...... [2004 – 2006] 13 N.B.L.R. (PART II) 365

Conveyancing and Law of Property Act, 1881 (applicable to Lagos State) s 21...... [2004 – 2006] 13 N.B.L.R. (PART II) 215

Evidence Act s 149(d) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 95

Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 s 74...... [2004 – 2006] 13 N.B.L.R. (PART II) 204 s 97(1)(h)...[2004 – 2006] 13 N.B.L.R. (PART II) 31; 124 s 97(2)(e)...[2004 – 2006] 13 N.B.L.R. (PART II) 31; 124 s 108(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 143 s 131(1) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 31 s 136...... [2004 – 2006] 13 N.B.L.R. (PART II) 31 s 137(1) .....[2004 – 2006] 13 N.B.L.R. (PART II) 31, 143 s 137(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 31 s 138...... [2004 – 2006] 13 N.B.L.R. (PART II) 31 s 138(1) .....[2004 – 2006] 13 N.B.L.R. (PART II) 31, 143 s 149(d) ...[2004 – 2006] 13 N.B.L.R. (PART II) 397; 492

Evidence Act Cap E14 Laws of the Federation of Nige- ria, 2004 s 86...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 s 88...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 s 89...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 lx [2004 – 2006] 13 N.B.L.R. (PART II)

Index of Nigerian Statutes referred to

Failed Banks (Recovery of Debts) and Financial Mal- practices in Banks Decree No. 18 of 1994 s 3(3)(b)(ii)...... [2004 – 2006] 13 N.B.L.R. (PART II) 256

Federal High Court Act Cap F12 Laws of the Federation of Nigeria, 2004 s 7(d) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 381 s 7(e)...... [2004 – 2006] 13 N.B.L.R. (PART II) 381

High Court Law of Lagos State, 1994 s 12...... [2004 – 2006] 13 N.B.L.R. (PART II) 16

Nigeria Deposit Insurance Corporation Act Cap 301 Laws of the Federation of Nigeria, 1990 s 13(2) ...... [2004 – 2006] 13 N.B.L.R. (PART II) 343 s 22...... [2004 – 2006] 13 N.B.L.R. (PART II) 343

Sales by Auction Law of Lagos State s 19...... [2004 – 2006] 13 N.B.L.R. (PART II) 215 s 20...... [2004 – 2006] 13 N.B.L.R. (PART II) 215 s 21...... [2004 – 2006] 13 N.B.L.R. (PART II) 215

Sheriff and Civil Process Act Cap S6 Laws of the Fed- eration of Nigeria, 2004 s 84...... [2004 – 2006] 13 N.B.L.R. (PART II) 492

Torts Law of Anambra State Cap. 135 of 1986 s 99(1)(b)...... [2004 – 2006] 13 N.B.L.R. (PART II) 343

lxi

FOREIGN STATUTES REFERRED TO IN THE JUDGMENT

Partnership Act, 1890 s 5 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 143 s 10...... [2004 – 2006] 13 N.B.L.R. (PART II) 143 s 15...... [2004 – 2006] 13 N.B.L.R. (PART II) 143

lxiii

INDEX OF NIGERIAN RULES OF COURT REFERRED TO

Court of Appeal Rules, 2002 Order 1 rule 19(1) [2004 – 2006] 13 N.B.L.R. (Part II) 453 Order 1 rule 19(2) [2004 – 2006] 13 N.B.L.R. (Part II) 453

Federal High Court (Civil Procedure) Rules, 2000 Order 25 rule 2 ....[2004 – 2006] 13 N.B.L.R. (Part II) 381 Order 25 rule 3 ....[2004 – 2006] 13 N.B.L.R. (Part II) 381 Order 25 rule 4 ....[2004 – 2006] 13 N.B.L.R. (Part II) 381 Fundamental Rights (Enforcement Procedure) Rules Cap 62 Laws of the Federation of Nigeria, 1990 Order 1 rule 3 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 343 High Court of Kano State (Civil Procedure) Rules, 1988 Order 23 rule 3(1)... [2004 – 2006] 13 N.B.L.R. (Part II) 177 Order 23 rule 3(4)... [2004 – 2006] 13 N.B.L.R. (Part II) 177 Order 23 rule 4 ....[2004 – 2006] 13 N.B.L.R. (Part II) 177 High Court of Lagos State (Civil Procedure) Rules, 1972 Order 10 rule 1 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 1 Order 10 rule 2 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 1 Order 10 rule 3(a) ...[2004 – 2006] 13 N.B.L.R. (Part II) 1 Order 10 rule 3(b) ...[2004 – 2006] 13 N.B.L.R. (Part II) 1 Order 16 rule 11 ..[2004 – 2006] 13 N.B.L.R. (Part II) 272 High Court of Lagos State (Civil Procedure) Rules Cap 62 Laws of Lagos State, 1994 Order 2 rule 1 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 215 Order 38 rule 7 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 16 High Court of Oyo State (Civil Procedure) Rules, 1988 Order 10 rule 1 ....[2004 – 2006] 13 N.B.L.R. (Part II) 215

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INDEX OF BOOKS REFERRED TO

Andrew & Millet Law of Guarantees (1ed) pages 162 – 163...[2004 – 2006] 13 N.B.L.R. (Part II) 272

Black’s Law Dictionary (5ed) pages 370 – 371...[2004 – 2006] 13 N.B.L.R. (Part II) 272

Black’s Law Dictionary (6ed) page 391 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 31 page 1580 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 272

Black’s Law Dictionary (7ed) page 1574 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 272

Byles on Bills of Exchange (23ed) pages 129, 130, 168....[2004 – 2006] 13 N.B.L.R. (Part II) 272

Chitty on Contract Volume 2 (24ed) generally...... [2004 – 2006] 13 N.B.L.R. (Part II) 272

Chitty on Contract Volume 1 (25ed) paragraphs 871 – 872 .[2004 – 2006] 13 N.B.L.R. (Part II) 470

Collins English Dictionary generally...... [2004 – 2006] 13 N.B.L.R. (Part II) 31

Halsbury’s Laws of England (3ed) Volume 14 paragraph 1175....[2004 – 2006] 13 N.B.L.R. (Part II) 272

Halsbury’s Laws of England (4ed) Volume 20 page 158 paragraph 291 ..[2004 – 2006] 13 N.B.L.R. (Part II) 272 lxvii [2004 – 2006] 13 N.B.L.R. (PART II)

Nigerian Banking Law Reports

Jowitts Dictionary of English Law generally...... [2004 – 2006] 13 N.B.L.R. (Part II) 272 page 253 paragraph 378 ...... 272

Modern Practice Journal of Finance and Investment Law Volume 2, No. 1 (1998) page 76...... [2004 – 2006] 13 N.B.L.R. (Part II) 256

Olakunle Orojo Company Law and Practice in Nigeria page 87...... [2004 – 2006] 13 N.B.L.R. (Part II) 256

Paget’s Law of Banking (8ed) page 474 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 143

Palmers Company Law Volume 1 (24ed) page 156 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 256

Rowlatt Principal & Surety (3ed) page 102 ...... [2004 – 2006] 13 N.B.L.R. (Part II) 272

Stroud’s Judicial Dictionary (4ed) Volume 2 generally...... [2004 – 2006] 13 N.B.L.R. (PART II) 177

Supreme Court Practice 1985 Volume 1 pages 261 – 262...[2004 – 2006] 13 N.B.L.R. (Part II) 272

The Hand of Arbitration Practice Ronald Bernstein page 18...... [2004 – 2006] 13 N.B.L.R. (PART II) 86

Words & Phrases Legally Defined (3ed) Volume 2 page 301 ...... [2004 – 2006] 13 N.B.L.R. (PART II) 113 pages 313 – 314...... [2004 – 2006] 13 N.B.L.R. (PART II) 113

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Thor Ltd v First City Merchant Bank Ltd 1 a Thor Ltd v First City Merchant Bank Ltd b SUPREME COURT OF NIGERIA BELGORE, ONU, KALGO, MUSDAPHER, EDOZIE JJSC Date of Judgment: 3 JUNE, 2005 Suit No.: SC 245/2000

Banking – Interest rate – Customer alleging exorbitant c interest rate receiving regular statement of account – Whether can sustain Banking – Statement of account – Allegation of manipulation – Customer receiving regular statement of d account – Whether can sustain

Facts The appellant owed the respondent a certain sum of money e for which he was sued. In his defence he alleged that his statement of account was manipulated and the rate of interest was exorbitant. The plaintiff bank however showed that regular statement of f account was sent to him and he had never complained.

Held – A party will be deemed to have accepted the rate at which g interest on a bank overdraft was calculated if he received from the bank periodic statements of account in which the interest charged was shown as a debit and he did not dispute the account as shown by the statements. h As the defendant raised no objection in respect of the statements of account, the complaint about manipulations and wrong interest charges is a mere afterthought. i Appeal dismissed. Cases referred to in the judgment Nigerian j Barclays Bank DCO v Hassan (1961) All NLR 836

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Macaulay v NAL Merchant Bank Ltd (1990) 4 NWLR (Part a 144) 283 Nishizawa Ltd v Jethwani (1984) 12 SC 234 b Pan Atlantic Shipping and Transport Agencies Ltd v Rhein Mass GMBH (1997) 3 NWLR (Part 493) 248 Sanusi Bros (Nig) Ltd v Cotia CEISA (2000) 11 NWLR (Part 679) 566 c Sodipo v Lemninkainem OY (1986) 1 NWLR (Part 15) 220 Foreign Anglo-Italian Bank v Wells (1878) 38 LTR 197 d Lady Anne Tenant v Associated Newspapers (1979) 5 Fleet Street Reports 298 May v Chidley (1894) 1 QB 451 e Nigerian rules of court referred to in the judgment High Court of Lagos State (Civil Procedure) Rules, 1972, Order 10 rules 1 and 2; Order 10 rule 3(a) and (b) f Counsel For the appellant: Kola-Balogun For the respondent: Ayorinde (with him Elah) g Judgment EDOZIE JSC: (Delivering the lead judgment) In the High Court of Lagos State in Suit No LD/1389/94, the respondent h as plaintiff by its writ of summons and statement of claim, claimed against the appellant as defendant the following reliefs:– “(a) The sum of N12,303,145.19 (Twelve Million, Three i Hundred and Three Thousand, One Hundred and Forty- Five Naira, Nineteen Kobo), being the outstanding debit balance on the defendant’s Account No. 5049400/820 with the plaintiff as at 31 December, 1993, in respect of various credit facilities (banker’s acceptance, revolving credit and j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Thor Ltd v First City Merchant Bank Ltd 3 a overdraft) granted by the plaintiff to the defendant between December, 1987 and February, 1989. (b) Interest on the said sum at the rate of 21% per annum from b the 1 January, 1994 until the whole amount outstanding is fully liquidated.” In reaction, the defendant filed a statement of defence and counter-claim wherein it denied the plaintiff’s claims and by c paragraphs 2 – 4 of the counter-claim, the defendant claimed against the plaintiff as follows:– “(1) The defendant counter-claims against the plaintiff the sum of N1,943,599.00 being over payments made by the defendant d to the plaintiff over the material time. (2) The sum of US150,000.00 dollars deposited by Decacia International Ltd as red letter portion of letters of credit issued in favour of the defendant. (3) The sum of N2,000,000.00 as damages for breach of e contract, to wit, the unlawful and unilateral suspension.” By summons for judgment brought pursuant to Order 10 rules 1 and 2 of the High Court of Lagos State (Civil f Procedure) Rules, 1972, the plaintiff bank sought from the trial court, an order entering final judgment in terms of its claims. Attached to the summons for judgment were an affidavit of 38 paragraphs and twenty-two exhibits. In opposition to the summons, the defendant filed affidavit of g merit of 38 paragraphs. The motion was moved and argued on 17 June, 1994 and by its reserved ruling delivered on 9 December, 1994 the learned trial Judge gave judgment in favour of the plaintiff bank thus:– h “Accordingly, an order is hereby made empowering the plaintiff to enter judgment in the sum of N12,303,145.19. The plaintiff also claimed interest the rate of 21% per annum from the 1 January, 1994 until the final liquidation of the whole debt with costs. It is i obvious to me that the plaintiff in this case is being kept out of money which ought to have been paid to her. On the strength of the principle established in the case of N.G.S.C. Ltd. v N.P.A. (1990) 1 N.W.L.R. (Pt. 129) 741 at 748, I hold that the plaintiff is entitled to interest at the rate of 15% per annum from the j 1 January, 1994 until this day and hereafter at the rate of 10% per

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annum until judgment debt is finally liquidated. Costs assessed at a N2,000.00 is awarded in favour of the plaintiff.” The court adjourned the counter-claim for trial. Dissatisfied with that judgment, the plaintiff lodged an appeal to the b Court of Appeal, Lagos Division and the sole issue canvassed before that court was whether the defendant was entitled to be let in to defend the claim of the plaintiff on the basis of the affidavit of merit and the statement of defence c before the trial court. In a unanimous decision, the Court of Appeal held that the defendant had not placed before the trial court sufficient facts to entitle it to be granted leave to defend the plaintiffs’ suit and accordingly dismissed the appeal. d This is a further appeal to this Court by the defendant. The appeal is predicated upon on a notice of appeal dated 25 January, 2000 to which were subjoined two grounds of appeal. The grounds of appeal were subsequently e regularised as they were alleged to be grounds of facts or mixed law and facts for which no leave of court was sought and obtained before filing them in contravention of section 233(3) of the Constitution of the Federal Republic of Nigeria, 1999. Parties by their Counsel filed and exchanged f briefs of argument. In the defendant/appellant’s brief, the two issues identified for determination are as follows:– “(i) Whether the plaintiff satisfied the onus on a party seeking summary judgment under Order 10 (now Order 11) High g Court of Lagos (Civil Procedure) Rules. (ii) Whether the defendant was entitled in the circumstances to be given leave to defend the action.” On its part, the plaintiff identified the following two issues:– h “(i) Whether the plaintiff complied with the provisions of Order 10 Rule 1(a) of the High Court of Lagos (Civil Procedure) Rules, 1972 in bringing its application for judgment subject-matter of this appeal (sic). i (iii) Was the Court of Appeal right in upholding the High Court’s decision that the defendant did not show a good defence or defences to the plaintiff’s action on the merits, neither did it disclose sufficient facts to entitle it to defend the action generally.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Thor Ltd v First City Merchant Bank Ltd 5 a Dealing with the first issue for determination, learned Counsel for the defendant contended in his brief of argument that under Order 10 of the High Court of Lagos (Civil b Procedure) Rules, a plaintiff has the onus to establish in his statement of claim a prima facie case and must by an affidavit verify the cause of action. It was further contended that the Order 10 procedure is not designed for a complicated case as the one in hand. It was contended that c the plaintiff did not make out a prima facie case in his pleadings, in that, there was no evidence that the amount claimed or any part thereof had actually been drawn down. There was no evidence of how the collaterals given as d security of the credit facilities were utilised; the plaintiff did not indicate in any material particular the interest rate chargeable on the loans nor did it attach any exhibits to substantiate interest rate on the loans. Referring to the case e of Sodipo v Lemminkainen OY (1986) 1 NWLR (Part 15) 220 at 231, it was submitted that proof of the actual amount claimed is a preliminary requirement of the said Order 10 and that the two lower courts were in error in assuming that f a mere technical compliance with the form of Order 10 amounts to sufficient verification of the claim. Learned Counsel then proceeded to highlight what he regarded as deficiencies in the plaintiff’s affidavit evidence including its failure to account for the cash securities given as collaterals g for the various loans and credit facilities, the subject-matter in litigation. Finally, it was argued that no explanations were given in respect of several debits reflected in the statement of accounts Exhibit “AB 18”. h In response to the above, learned Counsel for the plaintiff in his brief of argument contended that the plaintiff’s claim is in compliance with the procedure provided for under Order 10 of the Lagos High Court (Civil Procedure) Rules i (Rules for short). The issue under consideration calls for the proper interpretation of Order 10 of the Rules to determine what its requirements are from the point of view of what the plaintiff j is expected to do.

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For better appreciation, Order 10 rule 1 of the Rules has a two limbs, the first of which reads:– “(a) Where the defendant appears to a writ of summons specially indorsed with or accompanied by a statement of claim under b Order 4 Rule 4, the plaintiff may on affidavit made by himself or by any other person who can swear positively to the facts, verifying the cause of action and the amount claimed (if any liquidated sum is claimed), and stating that in his belief there is no defence to the action except as to the c amount of damages claimed, if any, apply to a Judge in chambers for liberty to enter judgment for such remedy or relief as upon the statement of claim the plaintiff may been titled to.” d As is evident from the above provision, the following are the preliminary requirements of the Order:– “(a) A statement of claim must have been indorsed on, or attached to the writ of summons served on the defendant. e (b) The defendant must not only have been served, he must also have entered appearance. (c) There must be an affidavit made by the plaintiff or by any person who can swear positively to the facts verifying the f cause of action and the amount claimed with a statement that the defendant has no defence to the action.” It is not the contention of the defendant that the above g requirements had not been met. Its contention is that the plaintiff has to prove prima facie case (sic) that its claim is true before the onus can shift to the defendant to supply affidavit of intention to defend. It was contended that whereas in a simple and straightforward case the verification h of the plaintiff’s affidavit could refer generally to the statement of claim, in a complicated case like the one in hand, the plaintiff’s verifying affidavit “must clearly and systematically establish the factual basis of his claim and i the right to each relief claimed”. The above contentions ave raised the question about the nature of the plaintiff’s affidavit verifying the cause of action in terms of Order 10 rule 1. In this regard it must be borne in mind that the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Thor Ltd v First City Merchant Bank Ltd 7 a object of the said order is to enable a plaintiff obtain (sic) quick judgment when there is no defence to the action. The summary judgment procedure which is similar to the b undefended list procedure, is designed to enable a party obtain judgment (sic) especially in liquidated demand cases, without the need for a full trial where the other party cannot satisfy the court that it should be allowed to defend the action – see Nishizawa Ltd v Jethwani (1984) 12 SC 234; c Macaulay v NAL Merchant Bank (1990) 4 NWLR (Part 144) 283, 314; Pan Atlantic Shipping and Transport Agencies Ltd v Rhein Mass GMBH (1997) 3 NWLR (Part 493) 248. As regards the nature or content of the affidavit sufficient to d verify the claim, this Court, in the case of Sodipo v Lemninkainem OY (1986) 1 NWLR (Part 15) 220 at 231 adopted with approval the decision in the case of May v Chidley (1894) 1 QB 451 where it was held that the affidavit e need not set out all the particulars nor verify the facts except by reference to the statement of claim. To the extent that the plaintiff’s statement of claim must disclose a reasonable cause of action, I agree with learned Counsel for the f defendant that the plaintiff must make a prima facie case before the onus of proof shifts to the defendant for rebuttal. A careful perusal of the statement of claim duly verified by affidavit as set out at pages 26 – 32 of the record of g appeal reveals the detailed particulars of the plaintiff’s cause of action. Paragraphs 3, 4, 5 and 6 thereof state clearly how the initial N1.2 million credit was applied for and the terms thereof. Paragraphs 7, 8, 9 and 11 deal with the additional N4 million facility as well as the terms relating h thereto. Paragraphs 12-16 relate to a further request for N2.3 million credit and the conditions attaching to the credit. Finally, in paragraphs 18-21 are averments relating to a further request for N13.5 million facility and the i terms thereof. The aggregate credit facilities extended by the plaintiff to the defendant totalling N21 million was then structured as pleaded in paragraph 22 of the statement of claim. The applicable interest rates were j pleaded in paragraphs 24 and 29 of the statement of claim

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC 8 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) while in paragraph 26 thereof it was pleaded that the a defendant made use of all the facilities but defaulted in repayment with the result that as at 21 December, 1993, the debit balance on the account of the defendant with b plaintiff stood at N12,303,145.19 being the principal sum claimed. Finally, the plaintiff pleaded in paragraph 30 of the statement of claim that periodic statements of account were c sent to the defendant without any query against any entry therein. Accompanying and in support of the application for summary judgment is the plaintiff’s verifying affidavit to which were exhibited 22 exhibits evidencing the various d transactions forming the basis of the plaintiff’s claim. The affidavit evidence not only referred to the statement of claim but repeated all the paragraphs therein and in paragraph 38, it deposed that the defendant has no defence to the action. In e my view, the plaintiff’s statement of claim disclosed a reasonable cause of action and as the claim was properly verified by the plaintiff’s affidavit and having regard to all the other requirements already mentioned, the plaintiff’s f application for summary judgment under Order 10 rule 1 of High Court of Lagos (Civil Procedure) Rules was in compliance with the said Order 10 rule 1. Accordingly, the first issue for determination is resolved in favour of the g plaintiff against the defendant. The second issue has to do with the requirement of a defendant who wishes the court to let him to defend (sic) the plaintiff’s suit under the summary judgment procedure. In h this connection, the second limb of Order 10 rule 1 of the High Court of Lagos State (Civil Procedure) Rules supra is pertinent. It deals with the discretion of the court to allow such a defendant to defend the action in these words:– i “. . . The Judge thereupon unless the defendant shall satisfy him that he has a good defence to the action on the merits or shall disclose such facts as may be deemed sufficient to entitle him to defend the action generally, may make an order empowering the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Thor Ltd v First City Merchant Bank Ltd 9 a plaintiff to enter such judgment as may be just, having regard to the nature of the remedy claimed.” Also pertinent is Order 10 rule 3(a) and (b) of the said Rule b which provides as follows:– “(a) The defendant may show cause against such application by affidavit, or the Judge may allow the defendant to be examined upon oath. c (b) The affidavit shall state whether the defence alleged goes to the whole or part only and (if so) to what part of the plaintiff’s claim.” In construing the above provisions of Order 10 rules 1– 3(a) and (b) of the said Rules, this Court, in the case of Macaulay d v NAL Merchant Bank Ltd (1990) 4 NWLR (Part 144) 283 at 306 following its earlier decision in Nishizawa Ltd v Jethwani (supra) had this to say:– “The defendant’s affidavit must ‘condescend upon particulars’ and e should, as far as possible, deal 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. It should also state whether the defence goes to the whole or part of the f claim, and in the latter case it should specify the part. A mere general denial that the defendant is not indebted will not suffice. (Wallingford v Mutual Society (1880) 5 App Cas, per Lord Blackburn at p. 704; Re General Rail Syndicate, Whiteley’s Case, (1900) 1 Ch per Lindley, M.R. at p. 369 Anon (1875) WN 249 per g Quain, J. at p. 250) unless the grounds on which the defendant relies as showing that he is not indebted are stated (ibid). If the affidavit commences, as it may, with a statement that the defendant is not indebted to the plaintiff in the amount claimed, or any part thereof, it should proceed to state why the defendant is h not so indebted and to state the real nature of the defence relied on (Re General Rail, Syndicate (supra)). Again, it is not enough for the defendant to show a case of hardship but creating no enforceable right e.g. past promise by i plaintiff unsupported by valuable consideration (Woolston v Baines (1876) WR 74), nor a mere inability to pay (Besant v Townsend, 22 LR 1r 389) nor an allegation that the plaintiff has given time for payment which, of course, constitutes no defence, unless there be consideration (Hookham v Nayer (1905) 22 TLR j 241).

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If the defence relied on is fraud, the affidavit should state the a particulars of the fraud (Wallingford v Mutual Society (1880) 5 App Cas 685). A mere vague general allegation of fraud is useless (ibid). b Similarly, if a legal objection is raised, the facts and the point of law arising thereon must be clearly stated. Indeed, in all cases, sufficient facts and particulars must be given to show that there is a bona fide defence (Wallingford v Mutual Society (1880) 5 App Cas 685, see judgment of Lord Blackburn at c page 704; Harrison v Bottenheim 26 WR 362; Ray v Barker 4 Ex. DD. 283; Shurmur v Young (1889) 5 TLR 155). Matter of hearsay is admissible in the defendant’s affidavit (Harrison v Bottenheim (1878) 26 WR 362 CA), provided that the sources and grounds of d information or belief are disclosed. See Rule 4(2), supra and Re Young Manufacturing Co (1900) 2 Ch 753 CA; and of Order 41 rule 5. The defendant’s affidavit is not conclusive and will not preclude him from relying on defences not raised in it (Ray v Newton e (1913) 1 K.B. per Hamilton, LJ at p. 258).” The nature of the defendant’s defence that will satisfy the court to let him to defend (sic) the Suit is further exemplified f by the decision of this Court in the case of Sanusi Bros (Nig) Ltd v Cotia CEISA (2000) 11 NWLR (Part 679) 566 at 580 thus:– “A defendant must show a bona fide or good defence on the merits g under the summary judgment procedure and not engage in manipulative and delaying tactics. See Macaulay v NAL Merchant Bank Ltd. (1990) 4 N.W.L.R. (Pt. 144) 283. To show that he has a good defence to the claim on the merits, the defendant must disclose facts to satisfy the court, usually by affidavit. To achieve h this, he is required to condescend upon particulars, – per Lord Blackburn in Wallingford v Mutual Society (1980) 5 App. Laws 685 at 704, and the defence must not be seen as frivolous and particularly ‘moonshine’ to use the expression of Lord Lindley in Codd v Delap (1905) 92 L.T. 810. To ‘condescend upon i particulars’ implies a true and real disclosure of facts upon which the court can readily discern a good defence.” It is in the light of the principles enunciated above that one 0. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Thor Ltd v First City Merchant Bank Ltd 11 a appellant’s brief alleging that the trial High Court was wrong in its decision in refusing to grant leave to the defendant to defend the suit and that the Court of Appeal b was in error to have affirmed the trial court’s decision in that regard. The first complaint of the defendant appears to relate to the “notice to admit documents” and “interrogatories” filed c by it (pages 121 and 122 of the record of proceedings). The defendant’s contention is that since all the relevant facts, materials and transactions relating to the defendant’s account with the plaintiff were within the exclusive control d and knowledge of the plaintiff, the defendant ought to be given leave “to make discoveries and to interrogate the plaintiff by interlocutory process and by cross-examination rather than being shut out”. It is the case of the defendant e that the application for interrogatories and notice to produce documents raised serious questions which if answered in its favour would amount to a complete defence. In my view, if the court were to let in a defendant to defend upon a mere application for interrogatories and notice to admit fact, that f would defeat the object of the summary judgment procedure as such an application could be nothing but a ploy to give a semblance of a defence to the action when none exists. A desire to investigate alleged obscurities and a hope that g something will turn up after the investigation cannot separately or in unison amount to sufficient reason for refusing to enter judgment for the plaintiff. See Lady Anne Tenant v Associated Newspapers (1979) 5 Fleet Street h Reports 298 at 303. The next complaint of the defendant is the allegation that the plaintiff utilised the cash collateral deposited with it. It was further alleged that collaterals offered by the defendant i were adequate to cover the sums owing and as such judgment should not have been entered against the defendant. Unfortunately, the defendant did not either in its statement of defence or “Affidavit of Merit” give detailed j particulars with respect to the amount of the collaterals,

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC 12 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) when they were deposited and subsequently utilised. By a paragraph 15 of the statement of defence it was averred, inter alia:– “From time to time the total sums due to the plaintiff were b recovered by realisation of the security provided by the defendant alone and from various payments received for credit of the defendant through the plaintiff . . .”. Again particulars of the security realised, when it was c realised and the value of the security were not supplied either in the statement of defence or in the “Affidavit of Merit”. In regard to this line of the defence, the learned trial Judge held at page 140 as follows:– d “The fact that such collaterals are provided does not mean that the lender’s only relief is limited to the collateral provided. The lender may decide to sue for the amount owing and proceed by way of attachment or by way of garnishee. He may also proceed against security provided by the borrower by way of e foreclosure and sale in the case of a mortgage arrangement between the lender and the borrower. The fact that securities were provided in this case is not a bar to the plaintiff’s right to sue for the amount owing. The issue of providing collateral, therefore, is unarguable to justify this matter proceeding to trial. The f plaintiff in this case attached all relevant exhibits to establish that the defendant has not paid the money owing. It is, therefore, not sufficient for the defendant to merely claim that the plaintiff has realised and recovered the collateral. It is necessary g and essential for the defendant to give and supply details and particulars backed up with documents of such realisation and recoveries if any.” The above reasoning cannot be faulted. By failing to h substantiate its bare statement with detailed particulars supported by documents, the defendant did not show that it had a good defence to the action on the merits neither did it disclose facts that would have been deemed sufficient to entitle it to be granted leave to defend the action. The i plaintiff averred and this was not controverted that the statements of its account with the defendant were sent to the latter regularly. These statements of account had not been falsified and, therefore are presumed to be correct. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Thor Ltd v First City Merchant Bank Ltd 13 a In further support of its contention that it ought to have been let in to defend the action, the defendant relied on the counter-claim against the plaintiff for (a) N1,943,599 being b over payments made by the defendants to the plaintiff (b) USD150,000 deposited by Decacia International Ltd being letters of credits issued in favour of the defendant and (c) N2,000.000 as damages for breach of contract for unlawful and unilateral suspension. The case of Anglo-Italian Bank v c Wells (1878) 38 LTR 197 is authority for the proposition that the mere fact that the defendant has a counter-claim does not necessarily entitle him to leave to defend. Where, therefore, there is no defence to the plaintiff’s claim and d there is no arguable set-off or bona fide counter-claim, judgment would be given to the plaintiff. In other words, if the counter-claim set up by the defendant is clearly groundless, it will be disregarded – see Anglo-Italian Bank v e Wells (1878) 38 LTR 197. In the instant case, the counter- claim of about N1.9 million over payment could not have been made in good faith. This is so, because the defendant did not state how much of its securities had been realised f and the amount appropriated to settle its indebtedness and in the absence of these, a claim for overpayment is speculative. The other two claims on the counter-claim are also not made bona fide. As averred in paragraph 17 of the statement of defence, there was no actual deposit of USD150,000, rather g it was a letter of credit of that amount opened for Decacia International Ltd. The third claim, that is, unliquidated damages for N2 million for breach of contract for “unlawful and unilateral suspension” is rather vague and groundless. In h my view, the defendant’s counter-claim is manifestly unarguable and not having been made bona fide should not operate to disentitle the plaintiff to judgment. Finally, the defendant alleged there were manipulations in i the statement of account of the defendant with the plaintiff’s bank and that interest and exchange rates used by the plaintiff were exorbitant. But as noted earlier, the plaintiff regularly furnished the defendant a statement of account in j respect of the subject matter of this suit. The defendant did

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC 14 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) not dispute receiving the statement of accounts. There is no a evidence that it challenged any entry in the said statement of accounts. In the case of Barclays Bank DCO v Hassan (1961) All NLR 836, it was held thus:– b “A party will be deemed to have accepted the rate at which interest on a bank overdraft was calculated if he received from the bank periodic statements of account in which the interest charged was shown as a debit and he did not dispute the account as shown by the statements.” c As the defendant raised no objection in respect of the statements of account, the complaint about manipulations and wrong interest charges is a mere afterthought. d In the light of the foregoing, it is my judgment that the Court of Appeal was right in affirming the trial High Court’s decision to the effect that the defendant did not show a good defence to the plaintiff’s action neither did it disclose e sufficient facts to entitle it to defend the action. I will, therefore, resolve the second issue for determination in favour of the plaintiff against the defendant. In the event, the appeal lacks merit and it is accordingly f dismissed. I affirm the decision of the two lower courts. The sum of N10,000 costs is awarded to the plaintiff against the defendant. g BELGORE JSC: This appeal totally lacks merit and my learned brother Edozie, JSC has clearly set out the facts of the case portraying the unfortunate trend of the case. I have nothing more to add than to adopt his reasoning and h conclusions as mine in dismissing this appeal.

ONU JSC: Having been privileged to read before now the judgment of my learned brother, Edozie, JSC just delivered, I am in agreement with him that the appeal lacks merit and I i too accordingly dismiss it.

KALGO JSC: I have read in draft the judgment just delivered by my learned brother Edozie, JSC in this appeal. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Kalgo JSC Thor Ltd v First City Merchant Bank Ltd 15 a I agree with him that there is no merit in the appeal and it ought to be dismissed. The appellant had never disputed the contents of any of the various statements of account sent to b him on his account with the respondent over the years, and the 22 exhibits which accompanied the verifying affidavit are in full compliance with Order 10 rule 1 of the Lagos State High Court (Civil Procedure) Rules, 1973. This fully c disclosed a proper cause of action on the part of the respondent. The appellant on the other hand, filed an affidavit which in the circumstances of this case did not disclose any defence to the action on the merits. d For this and the more detailed reasons given in the leading judgment, I also find no merit in this appeal. I dismiss it and affirm the decision of the Court of Appeal. I award N10,000 costs to the respondent against the e appellant.

MUSDAPHER JSC: I have read before now the judgment of my Lord Edozie, JSC just delivered. In the aforesaid judgment his Lordship has comprehensively and completely f dealt with all the relevant issues submitted to this Court for the determination of the appeal. I adopt his reasoning as mine and I accordingly find no merit in the appeal, and I dismiss it with costs as assessed in the said judgment. g Appeal dismissed.

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a Daniel Holdings Ltd v United Bank for Africa Plc b SUPREME COURT OF NIGERIA BELGORE, KATSINA-ALU, MUSDAPHER, OGUNTADE, AKINTAN JJSC Date of Judgment 1 JULY, 2005 Suit No.: SC 10/2001

Banking – Account – Payment into account of customer in a c bank – Shortfall between what cashier paid in and amount credited to account by Bank – How to resolve Banking – Interest rate – Bank rate issued by Central Bank of Nigeria by circulars – Whether court to take judicial d notice of – Need to lead evidence thereon Banking – Interest rate – Claim to interest at “Prevailing rate” – Need to lead evidence thereon e Practice and procedure – Post judgment interest – Award of – Rate of – Section 17 Judgment Act, 1838

Facts f The plaintiff was a trading company. On a regular basis, it caused to be lodged in its accounts with the defendant, a banker, the proceeds from its business. The plaintiff had its account at the defendant’s Lagos East Branch, 12 Broad g Street, Lagos. The plaintiff filled into a bank teller, consisting of the bank copy and the customer’s copy (herein after referred to as the “counterfoil”), the amount it intended to pay in. This was recorded on both the bank copy (hereinafter referred to as the “original”) and the counterfoil. h The money was taken to the bank by the employees of the plaintiff. The defendant’s counter clerks or officials, in acknowledge- ment of the fact that the amount recorded on the original and i counterfoil of the teller was paid in, affixed the bank’s stamp impression on both the original and counterfoil. The counter clerk receiving the money then appended his signature or initials to both the original and counter foil. j

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Daniel Holdings Ltd v United Bank for Africa Plc 17 a It was plaintiff’s case that between 1/2/87 and 1/7/89, the amount credited into its account, when contrasted with the payments shown on the counterfoils of the tellers which b were used to make the payments, showed a shortfall of N93,846.50. In simp1e language, it was the contention of the plaintiff that the defendant credited his account with N93,846,50 less money than was actually paid in by the c plaintiff going by the relevant counterfoils of tellers which the plaintiff had. The defendant in its statement of defence denied the averments in plaintiff’s statement of claim. It contended that d the impression stamp used on the counterfoil tellers was not it’s own; and that its staff did not initial any false entries contained in the counterfoil tellers. The defendant also denied that there was any shortfall between the amount e actually recorded in the original tellers and the amount credited into plaintiff’s account. The plaintiff therefore claimed the total sum of N93,846.50 (ninety-three thousand, eight hundred and forty f six naira, fifty Kobo) being the monies had and received by the defendant for the plaintiff’s use. The learned trial Judge entered judgment for the plaintiff and awarded the sum of N93,846.50. He also awarded g interest. The defendant’s appeal to the Court of Appeal was partially allowed. The order of interest was set aside and the principal sum was reduced from N93,846.50 to N68,541.50. The plaintiff was dissatisfied with the judgment and h appealed to the Supreme Court.

Held – 1. In order to establish a shortfall in the amount paid into a i bank account and amount credited therein, the cashier needed to produce the counterfoils of the tellers by which the payments were made at the relevant period, with a view to showing that the amounts recorded on j them, were on each occasion more than the amounts

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actually credited into his account. In view of the denial a by the defendant that its employees stamped and initialed the tellers, the plaintiff would need to establish the authenticity of the counterfoils by showing that they b were indeed impression-stamped and initialled by the defendant’s staff/employees. 2. Where the party claims interest of the “prevailing rate”, it must lead evidence to what the prevailing interest was c at the material time. 3. Interest may be claimed as a right where it is contemplated by the agreement between the parties or under a mercantile custom, or under a principle of equity d such as breach of a fiduciary relationship. Where interest is being claimed as a matter of right, the proper practice is to claim entitlement to it on the writ and plead facts which show such an entitlement in the statement of e claim. (Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) 422 followed.) 4. The plaintiff should have been awarded interest under section 17 of the Judgments Act of 1838 in England f being a pre-1 January, 1900 Statute of general application, which provides that every judgment debt shall carry interest at the rate of four pounds per centum per annum, from the time of entering up the judgment g until the judgment debt is fully liquidated. 5. Bank rate, issued by Central Bank of Nigeria in occasional circulars is not a matter to be taken judicial notice of under Evidence Act, there must be some h evidence of it. Appeal allowed in part; cross-appeal dismissed.

Cases referred to in the judgment i Nigerian A-G, Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255 j

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Daniel Holdings Ltd v United Bank for Africa Plc 19 a Akeredolu v Akinremi (1989) 3 NWLR (Part 108)164 Ekpan v Uyo (1986) 3 NWLR (Part 26) 63 b Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) 422 Kosile v Folarin (1989) 3 NWLR (Part 107) 1 c Lokoyi v Olojo (1983) 2 SCNLR 127 Ojomu v Ajao (1983) 2 SCNLR 156 Osho v Foreign Finance Corp (1991) 4 NWLR (Part 184) 1 57 d Osuji v Isiocha (1989) 3 NWLR (Part 111) 623 Overseas Construction Ltd v Creek Ent Ltd (1985) 3 NWLR (Part 13) 407 e Udechukwu v Onwuka (1956) SCNLR 189 Union Beverages Ltd v Owolabi (1988) 1 NWLR (Part 68) 128 f Nigerian statute referred to in the judgment High Court Law of Lagos State, 1994, section 12 g Nigerian rules of court referred to in the judgment High Court of Lagos State (Civil Procedure) Rules Cap 62 Laws of Lagos State, 1994, Order 38 rule 7 h Counsel For the appellant: Pinheiro (with him Kamoru) i For the respondent: Demuren

Judgment OGUNTADE JSC: (Delivering the lead judgment) The j appellant, as the plaintiff, at the High Court of Lagos State

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 20 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) claimed against the respondent, as the defendant, for the a following:– “. . . total sum of N93,846.50 (Ninety-Three Thousand, Eight Hundred and Forty Six Naira, Fifty Kobo) being the monies had b and received by the defendant for the plaintiff’s use . . .”. The parties filed and exchanged pleadings, after which the suit was tried by Hunponu Wusu, J. Each party called one witness. On 17/12/93, the trial Judge, in a reserved c judgment, granted plaintiff’s claim for N93,846.50. The trial Judge would also appear to have awarded interest, for he concluded the judgment in these words:– “The plaintiff also claim interest on the said N93,846.50 at 21% d per annum from 1 January, 1991 until today and at 7% per annum from today until the whole amount is liquidated. Cost is assessed atN2,000.00.” Was that an award of interest or not? The language used is e certainly ambivalent. However, given the issues raised before the Court of Appeal and this Court, the parties appeared to have accepted that the trial court awarded interest in the passage reproduced above. The defendant was f dissatisfied with the judgment. It brought an appeal before the Lagos Division of the Court of Appeal (hereinafter referred to as “the court below”). The court below, in its judgment, partially allowed the appeal. It set aside the order g awarding interest and reduced the principal sum from N93,846.50 to N68,541.50. The plaintiff was dissatisfied with the judgment of the court below, it has brought this appeal against it. In the h appellant’s brief filed, the issues for determination in the appeal were identified as these:– “(1) Whether or not the court below was right to have reduced the amount awarded from N93,846.50k to N68,541.50k. i (2) Whether the court below was correct in failing to award any interest in favour of the plaintiff/ appellant.” The defendant before the trial court, was also dissatisfied with the judgment of the court below. It brought a cross j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Daniel Holdings Ltd v United Bank for Africa Plc 21 a appeal, and the solitary issue formulated from the grounds of cross appeal reads:– “(1) Whether the cross appellant/respondent has not shown by b credible evidence on record (particularly) in view of the alterations and/or falsifications evident on the counterfoils tendered as exhibits 1-7 vis-à-vis the original copies tendered as exhibits 26 – 29 that a different sum of money was actually received from plaintiff appellant as against the sums c purportedly acknowledged on the counter foils.” The issues raised from the appeal and the cross-appeal could be conveniently considered together. I intend to so deal with d them. But I should first briefly discuss the facts leading to the dispute out of which this appeal arose. The plaintiff was a trading company. On a regular basis, it caused to be lodged in its accounts with the defendant, a e banker, the proceeds from its business. The plaintiff had its account at the defendant’s Lagos East Branch, 12 Broad Street, Lagos. The plaintiff filled into a bank teller, consisting of the bank copy and the customer’s copy (herein f after referred to as the counterfoil), the amount it intended to pay in. This was recorded on both the bank copy (hereinafter referred to as “the original”) and the counterfoil. The money was taken to the bank by the employees of the plaintiff. g The defendant’s counter clerks or officials, in acknowledge- ment of the fact that the amount recorded on the original and counterfoil of the teller was paid in, affixed the bank’s stamp impression on both the original and counterfoil. The counter h clerk receiving the money then appended his signature or initials to both the original and counterfoil. It was plaintiff’s case that between1/2/87 and 1/7/89, the amount credited into its account, when contrasted with the i payments shown on the counterfoils of the tellers which were used to make the payments, showed a shortfall of N93,846.50. In simple language, it was the contention of the plaintiff that the defendant credited his account with j N93,846,50 less money than was actually paid in by the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 22 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) plaintiff going by the relevant counterfoils of tellers which a the plaintiff had. The defendant in its statement of defence denied the averments in plaintiff’s statement of claim. It contended that b the impression stamp used on the counterfoil tellers was not it’s own; and that its staff did not initial any false entries contained in the counterfoil tellers. The defendant also denied that there was any shortfall between the amount c actually recorded in the original tellers and the amount credited into plaintiff’s account. Guided by the parties pleading, one might have thought d this would be a simple issue to resolve. The plaintiff needed to produce the counterfoils of the tellers by which the payments were made at the relevant period, with a view to showing that the amounts recorded on them, were on each occasion more than the amounts actually credited into his e account. In view of the denial by the defendant that its employees stamped and initialed the tellers, the plaintiff would need to establish the authenticity of the counterfoils by showing that they were indeed impression stamped and f initialed by the defendant’s staff/employees. The trial court, from the evidence produced by the parties, came to the conclusion that the stamp impressions on the g counterfoil of the tellers with which the plaintiff made the payments were the defendant’s and that the defendant’s employees initialed the counterfoils. The court below also agreed with this finding. The point of departure between the two courts below was the procedure adopted in the proof of h the shortfalls involved, At the trial court, the counterfoils of tellers upon which the plaintiff relied to show that there was a shortfall of N93,846.50 were 135 in number. Instead of showing one after the other, the shortfall on each of the i teller, the parties, with the sanction of the trial court, agreed that the proof of the shortfall be done by a random sampling of twenties. This entailed tendering together at a time twenty counterfoils and if there was a short fall successively on the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Daniel Holdings Ltd v United Bank for Africa Plc 23 a batches of twenty, then plaintiff’s loss of N93,846,50 was assumed to have been established. I need to say that the two courts below were agreed that b there was a shortfall in the amount credited into the plaintiff’s account and the amount actually paid by the plaintiff. The inevitable inference to be drawn from this, is that both courts below found that the defendant was c negligent in handling the plaintiff’s account and that the negligence caused to the plaintiff a loss of money. In other words, there was a concurrent finding of fact by both courts below on the defendant’s negligence. The defendant/cross- d appellant by its cross-appeal wishes us in this Court to disturb or ignore the concurrent finding of fact. This Court does not interfere with the concurrent findings of fact made by the two courts below unless they are not justified by the evidence and have occasioned a miscarriage of justice. See e Lokoyi v Olojo (1983) 2 SCNLR 127; Ojomu v Ajao (1983) 2 SCNLR 156; Akeredolu v Akinremi (1989) 3 NWLR (Part 108) 164 and Osho and another v Foreign Finance Corporation and another (1991) 4 NWLR (Part 184) 157 at f 196. I am not in this Court able to disturb the conclusion that the defendant/respondent’s negligence caused a loss to the plaintiff/appellant. This disposes of the cross-appeal. g As to the procedure adopted by the trial court in the proof of the amount lost by the plaintiff, the trial court in its judgment at pages 78-79 had said:– “It was also contended by the defendant’s counsel that the h particulars as itemised in paragraph 7 of the statement of claim were in the nature of special damages and each item must be proved specifically. This view of the defendant’s counsel I am unable to agree to i because it was agreed to by both counsel and with the leave of court that only some items taken at intervals of 20 should be proved. The plaintiffs have therefore gone ahead to prove each of the 8 items. It would take a very long trial penod (sic) to require the plaintiff to prove each of the 135 items as contained in the j statement of claim.”

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It is apparent, from the above passage of the judgment of the a trial court that in order to quicken the trial, an abridged method of proof was devised and resorted to in the effort to show that there had been a shortfall of N93,846.50 in the b amount credited to the plaintiff. It seems to me that this approach, which differs little from an informed guesswork, is inappropriate to establish a claim for special damages. It is settled law that a claim for special damages must be c specifically pleaded and strictly proved. See Osuji v Isiocha (1989) 3 NWLR (Part 111) 623; Kosile v Folarin (1989) 3 NWLR (Part 107) 1 and A-G Oyo State v Fairlakes Hotels Ltd. (No. 2) (1989) 5 NWLR (Part 121) 255. d The court below deprecated the procedure adopted by the trial court in the proof of special damages when it said at pages 152 – 153 of the record in its judgment:– “It is my view that the nature of proof in a given case must e be dictated by the peculiar circumstances of the available evidence. In this case the plaintiff/respondent pleaded 135 items of special damages stating clearly the various specific amounts involved in the shortfalls. He proceeded further to f give evidence in support of the various amount by tendering payment Tellers i.e. exhibits 1 – 7 showing payments made into appellant Bank. These averments were made into plaintiffs account No. 20112563. The shortfalls were compiled from the statements of account produced by the g appellant bank for the relevant periods of shortages – see exhibits 16 – 24. Normally the statements of account should reflect the amount entered into the tellers but this has not happened in this case hence the accumulation of shortfalls as per paragraph 7 of the statement of claim. h The learned trial Judge knew there was sufficient credible evidence to cover most of the items of special damages but he circumvented the laid down procedure and adopted a short circuit system which portrays a line of least resistance ending i in a quick questionable summary. Learned trial Judge should have gone the whole hog with the correct laid down procedure and arrive at a just conclusion. Failure to do this should however not vitiate the proceedings in this case in view of the overwhelming credible evidence in favour of the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Daniel Holdings Ltd v United Bank for Africa Plc 25 a respondent. Moreover there is no miscarriage of justice erupting from this wrong procedure. Upon a careful perusal of each item of short fall supported by b the amounts portrayed in the statements of account issued by the appellant bank, the following items in paragraph 7 of the statement of claim have been strictly proved as required by the law. I quote items 1 – 9, 11 – 14, 15 – 24, 60 – 72, 75 – 102, 103 – 127 and 131 – 135. c When the amounts involved in these items are totalled up they amounted to a grand total of N168,541.50. There is no evidence of payments into the bank to support 11 other items hence the judgment of the lower court will be varied to read. d ‘Judgment is given in favour of the plaintiff for the sum of N68,541.50 being the monies had and received by the defendants to the plaintiff’s use as per particulars mentioned in the following items under paragraph 7 of the statement of claim items 1 – 9, 11 – 24, 60 – 72, 75 e – 127, 131 – 135. This sum is based on what is proved in the statement of claim which of course supersedes the writ of summons . . .’”. I have no doubt that the court below was correct in its views f in the above passage. Strict proof, required to establish a claim for special damages, translates in the context of this case, into a necessity for the plaintiff to call evidence to show the short fall on each of the 135 counterfoils of tellers g as pleaded. The plaintiff as it should do specifically pleaded all the 135 letters but failed to prove each strictly as required by law. The conclusion of the court below that only the sum of N68,541.50 which the evidence properly established h could be awarded cannot be disturbed by this Court. It was the right conclusion in the circumstances. The court below in setting aside the award of interest made by the trial Court said at page 154 of the record:– i “When one looks carefully at paragraph 11 of the plaintiff/ respondent’s statement of claim, it is very clear that the plaintiff never asked for interest at 21% per annum from 1 January, 1991 until today and at 7% per annum from today until the whole amount is liquidated. What they wanted as per statement of claim j has superseded the writ of summons was interest at the prevailing

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market rate (sic). Rather than grant the plaintiff what they asked a for, the learned trial Judge decided to grant the interest as claimed on the writ of summons. This is very wrong. There is even no evidence on record. as to what the prevailing market rate is hence this court cannot make any award which the lower court omitted to b make in its judgment (sic).” The plaintiff by its writ of summons had claimed “interest on the said sum at the rate of 21% from 1 January, 1991 to the date of judgment and thereafter at the rate of 7% unti1 c the whole amount is liquidated”. However, in its statement of claim, the plaintiff claimed interest “at the prevailing market rate”. Thus, the plaintiff varied or altered in the statement of claim, the claim it had d made on the writ of summons. The law is that a statement of claim supersedes a writ of summons. A claim made on the writ of summons, which is not repeated in the statement of claim or which is varied in the statement of claim will be e deemed abandoned or varied. See Overseas Construction Ltd v Creek Ent Ltd (1985) 3 NWLR (Part 13) 407 and Union Beverages Ltd v Owolabi (1988) 1 NWLR (Part 68) 118. The result is that, the plaintiff, not having repeated on f its statement of claim, the claims on interest earlier stated in the writ was to be deemed as abandoned. The plaintiff however still claimed interest at the prevailing rate. But no evidence was led as to what the g prevailing rate was at the relevant time. The court below felt unable to award an interest, in view of the failure of the plaintiff to call evidence on the prevailing rate. In Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) 422 at 445, h this Court, per Nnaemeka-Agu, JSC observed concerning the award of interest:– “Interest may be claimed as a right where it is contemplated by the agreement between the parties or under a mercantile custom, or i under a principle of equity such as breach of a fiduciary relationship. See London, Chatham & Dover Railway v S.E. Railway (1893) A.C. 429 at p.434 where interest is being claimed as a matter of right, the proper practice is to claim entitlement to it on the writ and plead facts which show such an entitlement in the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Daniel Holdings Ltd v United Bank for Africa Plc 27 a statement of claim. In Nigeria, as the law is that a statement of claim supersedes the writ, (for which see Udechukwu v Onwuka (1956) 1 FSC 70 at p. 71; (1956) SCNLR 189; Ekpan & Anor v Uyo (1986) 3 NWLR (Pt. 26) 63, if even it was not claimed on the b writ but facts are pleaded in the statement of claim and evidence given which show entitlement thereto, the court may, if satisfied with the evidence, award interest.” The plaintiff’s case arose of a customer-banker relationship. c The money, which the plaintiff paid to its account, was not credited thereto. The plaintiff must have lost interest on his money. But no evidence was called on the point. Now, under Order 38 rule 7 of the High Court Law of Lagos State (Civil d Procedure) Rules Cap 61 of 1994 Laws of Lagos, the plaintiff would have been entitled to interest at a rate not exceeding 7.5 per centum on the judgment debt. But the judgment of the trial court in Lagos was given on 17/12/93 e during which time Cap 61 was not in force. The relevant court rules as at 17/12/93 did not make provision for interest but section 12 of the High Court Law permits recourse to the Practice and Procedure of the High Court in England where f no provision is made in the Local Rules. It seems to me however that the plaintiff should have been awarded interest under section 17 of the Judgments Act of 1838 in England being a pre-1 January, 1900 statute of g general application, which provides:– “17. Every judgment debt shall carry interest at the rate of four pounds per centum per annum, from the time of entering up the judgment until the same shall be satisfied and such h interest may be levied under a writ of execution on such judgment debt.” See Ekwunife v Wayne (WA) Ltd (supra). In the final conclusion, this appeal partially succeeds. I i affirm the order of the court below granting the plaintiff N68,541.50 instead of the N93,846.50 earlier awarded by the trial court. The said sum of N68,541.50 is however to attract interest at the rate of four per centum per annum with j effect from 17/12/93 until the judgment debt is fully paid.

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The cross-appeal is dismissed. The appellant is entitled to a costs fixed at N10,000.

BELGORE JSC: I agree with my learned brother, Oguntade, b JSC that this appeal succeeds in part. The writ of summons opens a case in court, it shows in summary what a plaintiff intends to claim, even though in some cases not all he wants to claim. The real document for contention between the c parties is the pleadings. Once a statement of claim is filed, the writ of summons is no more of relevance. What was not in the writ of summons can be inserted into statement of claim; what appeared in writ of summons and omitted in d statement of claim is deemed to be abandoned. From the filing of writ of summons to the statement of claim a party may change his mind on what he originally wanted to claim and insert modifications in the statement of claim. To the defendant, statement of claim, setting out in numbered e paragraphs, the facts on which plaintiff relies for his claim, is the case he must react to by statement of defence. Thus once statement of claim is filed, the writ of summons goes into oblivion. Udechukwu v Onwuka (1956) SCNLR 189; f Ekpan v Uyo (1986) 3 NWLR (Part 26) 63; Overseas Construction Ltd v Greek Enterprises Ltd (1985) 3 NWLR (Part 13) 407; Union Beverages Ltd v Owolabi (1988) 1 NWLR (Part 68) 118. g Pleadings indicate facts parties rely upon for a court to decide their case. There are matters of general pleadings and specific pleadings. Where there is specific pleading of h special damages it must be proved by evidence clearly showing how the damages arise. Parties and court should not presume the court will be their calculator or instant computer. Every item of special damage in statement of claim must have clear evidence to support it. To dump over i one hundred and thirty documents before the court and lead evidence to some and not to others leaves the court no option than to consider those supported by evidence. Therefore, entries which had not been the subject of oral j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Belgore JSC Daniel Holdings Ltd v United Bank for Africa Plc 29 a evidence or examined in court cannot be real evidence. The defect cannot be cured by the examination of the documents by the learned Judge outside the court when considering his b judgment because those documents have not been tried and tested by examination and cross-examination to ascertain their authenticity. Thus, only those tellers tendered and testified upon were lawfully before the court and could be c considered for their authenticity, the others were merely there for conjecture and nothing more. The Counsel and the learned Judge at trial court by abridging the evidence have done injustice to our adjudi- d cative procedure, they have no right to do so. It is therefore one of those instances whereby the appellate court can disturb concurrent findings of fact if they are perverse and led to miscarriage of justice. Claim for e special damages must be strictly proved. See A-G Oyo State v Fairlakes Hotels Ltd (No. 2) (1989) 5 NWLR (Part 121) 255; Osuji v Isiocha (1989) 3 NWLR (Part 111) 623; Kosile v Folarin (1989) 3 NWLR (Part 107) 1. f As for interest on judgment debt it is either based on what the parties agreed to in their contract or the current bank rate. Bank rate, issued by Central Bank of Nigeria in occasional circulars is not a matter to take judicial notice of g under Evidence Act, there must be some evidence of it. But luckily, in the judgment of my learned brother, he adverted to the Judgments Act, 1838 (an English statute of general application up to 1900) whereby he quoted section 11 of that h statute of general application as appropriate to the matter. I agree entirely with the lead judgment on this. For the foregoing and the reasons advanced by my learned brother, Oguntade, JSC in the lead judgment, this appeal partially succeeds and order the same N10,000 as costs in this appeal i to the appellant.

KATSINA-ALU JSC: My Lords, I have had the advantage of reading in draft the judgment delivered by my learned j brother, Oguntade, JSC. I entirely agree with it and for the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC 30 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) reasons stated in it I too, would affirm the order of the court a below granting the plaintiff N68,541.50 instead of the N93,846.50 earlier awarded by the trial court. The said sum of N68,541.50 is however to attract interest at the rate of 4% b per annum with effect from 17 December, 1993 until the judgment debt is fully paid. I also abide by the order for costs. c MUSDAPHER JSC: I have had the honour to read in advance the judgment of my lord Oguntade JSC just delivered with which I entirely agree. In the aforesaid judgment, his Lordship has meticulously, lucidly and comprehensively discussed all the issues of facts submitted for the d determination of the appeal and the cross-appeal. I adopt the reasoning as mine and I according dismiss the cross-appeal and partially allow the appeal. I affirm judgment in favour of the appellant in the sum of N68,541.50 and I also order e interest at rate of 4% per annum with effect from 17/12/93 until its total liquidation and I abide by the order for costs proposed in the said lead judgment. f AKINTAN JSC: I had the privilege of reading before now the leading judgment written by my learned brother, Oguntade JSC which has just been delivered. All the issues raised in the appeal and the cross-appeal are well set out and g fully discussed. I therefore need not repeat them. I entirely agree with his reasoning and conclusion that the court below was right in reducing the award made by the trial court. I also agree that the appellant is entitled to interest on the reduced award at 4% per annum with effect from 17/12/93 h and that there is no merit in the cross-appeal. I hereby dismiss the cross-appeal. I abide by the order on costs made in the leading judgment. i Appeal allowed in part, cross-appeal dismissed.

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Universal Trust Bank Nigeria Ltd v Ajagbule 31 a Universal Trust Bank Nigeria Ltd v Ajagbule and another b COURT OF APPEAL, BENIN DIVISION MUHAMMAD, AMAIZU, ABBA-AJI JJCA Date of Judgment– 1 JULY, 2005 Suit No: CA/B/122/2004 c Banking – Drawdown – Meaning of Banking – Interest rate – Unilateral variation of by bank – Whether permissible Words and phrases – Drawdown – Meaning of d Facts In the instant case, the first respondent is the Chairman and Managing Director of the second respondent company. The e second respondent is a customer to the appellant bank and maintained two current accounts at the appellant’s branch in Akure, Ondo State. Sequel to the request of the second respondent for credit f facilities sometimes in 1996, the appellant granted an overdraft facility of N1.5 million Naira to the second respondent. The first respondent’s property situate at No. 31 (formerly No. 40) Mariatun House Isewa Street, Clerk g Quarters was mortgaged as a collateral for the facility granted. In 1997, an overdraft facility of N5 million Naira was granted by the appellant to the second respondent. The first h respondent personally guaranteed the amount granted. In addition, a deed of hypothecation was entered into between the appellant and the respondents. The second respondent failed to pay the credit facilities to i the appellant in spite of repeated demands. The appellant then took steps to enforce its right under the deed of hypothecation of stock of motor- batteries in the custody of the second respondent. On 3 August, 1999 the appellant j came to the business premises of the second respondent at

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No. 28A, Ondo Road, Akure in Ondo State and insisted on a taking over the management and control of the premises. When the respondents refused to the taking over of their business premises, the appellant sealed the said premises and b stationed both policemen and security men from their office to guard the premises for 24 hours. When all entreaties to the appellant to re-open the premises failed, the respondents on 11 August, 1999 instituted an action against the appellant c at the Owo High Court whereby they claimed the reliefs set out in their statement of claim dated 10 August, 1999. The appellant joined issues with the respondents by its statement of defence and counter-claim dated 28 September, d 1999. The respondents also filed a reply to the defendant’s statement of defence dated 29 September, 1999. The matter proceeded to trial. The respondents called three witnesses while two witnesses gave evidence for the e appellant. 22 exhibits were tendered during the trial. On 17 December, 2003 the court delivered judgment in the suit in favour of the respondents. The court granted the declaratory reliefs sought by the respondents and awarded to the f respondents general damages in the sum of N5,000,000 (five million Naira) and special damages in the sum of N1,580,000 (one million, five hundred and eighty thousand Naira) against the appellant for the sealing of the premises of the second respondent. The appellants counter-claim was g dismissed. The appellant being dissatisfied with the decision of the court appealed against the said judgment by a notice of appeal dated and filed on 11 February, 2004 upon seven h grounds of appeal. The main argument in this case was whether the bank can unilaterally vary the interest rate agreed upon without the consent of customers. i

Held – 1. Where the terms and conditions as to the interest rate payable are specifically stated in the documents constituting j

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Universal Trust Bank Nigeria Ltd v Ajagbule 33 a the agreement between the parties, any variation of the interest rate must be signified by the respondent in writing. The general rule is that where the parties have b embodied the terms of their contract in a written document, extrinsic evidence is not admissible to add to, vary, subtract from or contradict the terms of the written instrument. This is also provided for in section 131(1) of c the Evidence Act. The appellants cannot therefore unilaterally adjust the rate of interest charged. 2. “Drawdown” is an act of drawing on available loan facility granted by the bank to the borrower. d Appeal allowed in part.

Cases referred to in the judgment Nigerian e Abiodun v United Bank for Africa Ltd (1997) 46 LRCN 1 Abubakar v The Government of Taraba State (1997) 51 LRCN 1479 f Adebayo v Ighodalo (1996) 38 LRCN 747; (1996) 5 NWLR (Part 450) 507 Adedeji & Sons Motors Ltd v Immeh (1996) 8 NWLR (Part 465) 240 g Adelaja v Fanoiki (1990) 2 NWLR (Part 131) 137 Adimora v Ajufo (1988) 3 NWLR (Part 80) 1 Agbaje v James (1967) NMLR 49 h Akalonu v Omokaro (2003) 8 NWLR (Part 821) 190 Akintunde v Ojiekere (1971) NMLR 91 Aro v Aro (2000) 3 NWLR (Part 649) 443 i Atanda v Ajani (1989) 3 NWLR (Part 111) 511 Bamayi v A-G of the Federation and others (2001) 90 LRCN 2738; (2001) 12 NWLR (Part 727) 468 j Bamgbose v Jiaza (1991) 3 NWLR (Part 177) 64

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Bank of the North Ltd v Idirisu (2000) 3 NWLR (Part 649) a 373 Benin Rubber Producers Ltd v Ojo (1997) 9 NWLR (Part 521) 388 b Busari v Oseni (1992) 4 NWLR (Part 237) 557 Calabar East Co-op. v Ikot (1999) 14 NWLR (Part 638) 225 Chukujekwu v Olarele (1992) 2 NWLR (Part 221) 80 c Duyile and another v Ogunbayo & Sons Ltd (1988) 1 NSCC (Vol. 19) 385 Ebo v Nigerian Television Authority (1996) 4 NWLR (Part 442) 314 d Ebueku v Amola (1988) 3 SCNJ (Part II) 207; (1988) 2 NWLR (Part 75) 128 Ekpe v Fagbemi (1978) All NLR 107; (1978) 3 SC 209 e Eliochin (Nig) Ltd and others v Mbadiwe (1986) 1 NWLR (Part 14) 47 Emegokwue v Okadigbo (1973) 4 SC 113 Eze v Federal Republic of Nigeria (1987) 1 NWLR (Part 51) f 506 Ezeani v Ejidike (1964) 1 All NLR 402 FATB Ltd v Partnership Investment Co Ltd (2003) 18 g NWLR (Part 851) 35 FMF Ltd v Ekpo (2004) 2 NWLR (Part 856) 100 Garba v Federal Civil Service Commission (1988) LRCN 3485; (1989) 1 NWLR (Part 71) 449 h Gbajor v Ogunburegui (1961) All NLR 853 GMBU v Rivway Lines Ltd (1998) 58 LRCN 3485 Ham Idu v Sahar Ventures Ltd (2004) 7 NWLR (Part 873) i 618 Haway v Mediowa (Nig) Ltd (2000) 13 NWLR (Part 683) 77 Ibile Holdings Ltd v PDSS (2002) 16 NWLR (Part 792) 117 Ibrahim v Ojomo (2004) 4 NWLR (Part 862) 89 j

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Universal Trust Bank Nigeria Ltd v Ajagbule 35 a Idika v Erisi (1988) 2 NWLR (Part 78) 563 Idonidoye-Obu v NNPC (2003) 2 NWLR (Part 805) 589 Inyang v Ebong (2002) 2 NWLR (Part 751) 284 b Ishola v Ajiboye (1998) 1 NWLR (Part 532) 71 Ivienagbor v Bazuaye (1999) 9 NWLR (Part 620) 552 Iwuoha v NIPOST Ltd (2003) 8 NWLR (Part 822) 308 c Kamalu v Umunna (1997) 5 NWLR (Part 505) 321 Kara v Wassah (2001) 18 NWLR (Part 744) 117 Koya v United Bank for Africa Ltd (1997) 1 NWLR (Part d 481) 251; (1997) 46 LRCN 1 Mercantile Bank of Nigeria Plc v Nwobodo (2000) 3 NWLR (Part 648) 297 Mohammed v Klargester (Nig) Ltd (2002) 14 NWLR (Part e 787) 335 NBN Ltd v Opeola (1994) 1 NWLR (Part 319) 126 Niger Construction Ltd v Okugbemi (1987) 11 – 12 SCNJ f 133; (1987) 4 NWLR (Part 67) 787 Niger Progress Ltd v NEL Corporation (1989) 3 NWLR (Part 107) 68 Nkpedem v Udo (2000) 9 NWLR (Part 673) 631 g Nsirim v Nsirim (2002) 94 LRCN 117; (1990) 11 NWLR (Part 138) 285 Obasanjo v Buhari (2003) 17 NWLR (Part 850) 510 h Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 Odiba v Azege (1998) 61 LRCN 4605; (1998) 9 NWLR (Part 566) 370 i Odogu v A-G of the Federation and others (1996) 40/4 LRCN 1454; (1996) 6 NWLR (Part 456) 508 Odulaja v Haddad (1973) 11 SC 357 Odumosu v ACB (1976) 11 SC 55; (1988) 1 NWLR (Part j 72) 601

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Ojegbe v Omotsone (1996) 6 NWLR (Part 608) 591 a Ojo v Victino Fixed Odds Ltd (2000) 9 NWLR (Part 673) 647 Okechukwu v Ndah (1967) NMLR 368 b Okeke v Aondoakaa (2000) 9 NWLR (Part 673) 501 Okochi v Animikwoi (2004) 114 LRCN 2924 Okonkwo v Ogbogu (1996) 37 LRCN 580; (1996) 5 NWLR c (Part 449) 420 Okoronkwo v Chukwueke (1992) 1 NWLR (Part 216) 175 Olowu v Olowu (1985) 3 NWLR (Part 13) 372 d Olujinle v Adeagbo (1998) 4 SCNJ 1; (1988) 2 NWLR (Part 75) 238 Oshinjinrin v Elias (1970) All NLR 153 Oshodi v Eyifunmi (2000) 13 NWLR (Part 684) 298 e Osuji v Isiocha (1989) 3 NWLR (Part 111) 623 Overseas Construction Co Ltd v Creek Enterprises Ltd (1985) 3 NWLR (Part 13) 406 f RCC (Nig) Ltd v Edomwonyi (2003) 4 NWLR (Part 811) 513 Rockonoh Property Co Ltd v Nig Telecommunications Plc (2001) 89 LRCN 2602; (2001) 14 NWLR (Part 733) 468 g Sha (Jnr) v Kwan (2000) 8 NWLR (Part 670) 685 Thor Ltd v FCMB Ltd (2003) 4 NWLR (Part 652) 274 Total Nigeria v Morkah (2002) 9 NWLR (Part 773) 492 h UBN Ltd v Odusote Book Stores Ltd (1996) 42 LRCN 1639; (1996) 9 NWLR (Part 421) 558 UBN Ltd v Ozigi (1994) 3 NWLR (Part 333) 385 i UBN Ltd v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150 UBN v Fajebe Foods Ltd (1998) 6 NWLR (Part 554) 380 Udengwu v Uzuegbu (2003) 13 NWLR (Part 836) 136 Woluchem and others v Gudi (1981) 5 SC 21 j

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Universal Trust Bank Nigeria Ltd v Ajagbule 37 a Foreign Prelin v Royal Bank of Liverpool (1870) LRSFS 92; (1870) LR. 5 Exch b Salomon v Salomon [1897] AC 22

Nigerian statute referred to in the judgment c Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, sections 97(1)(h), 97(2)(e), 131(1), 136, 137(1), 137(2), 138 d Books referred to in the judgment Black’s Law Dictionary (6ed) page 391 Collins English Dictionary e Counsel For the appellant: Adejuyigbe For the respondents: Edaringoyi f ABBA-AJI JCA: (Delivering the lead judgment) This is an appeal against the decision of Justice E A Komolafe of the Ondo State High Court sitting in Owo delivered on the g December, 2003 (sic). The plaintiff’s/respondent’s (hereinafter simply referred to as the respondents) claim against the defendant/appellant are as follows:– h “1. A declaration that any attempt on the part of the defendant to sell by way of public auction or otherwise the 1st plaintiff’s property at No. 31 Mariatun House (formerly No. 40) Asewa Street, Clerks Quarters, Owo in Ondo State which the 2nd i plaintiff mortgaged with the defendant bank is unconstitutional, illegal, ultravires, null and void. 2. A declaration that the 35% interest now being charged per annum by the defendant on the overdraft facility granted to the 2nd plaintiff plus 12% interest on excess advised credit j limit is unconstitutional, illegal, ultravires, null and void.

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3. N5,000,000.00 (Five Million Naira) being general damages a for the illegal sealing of the plaintiff’s business premises at No. 28A Ondo Road, Akure in Ondo State. 4. N20,000.00 (Twenty Thousand Naira) being loss of earning b per day for the illegal sealing of the said plaintiffs business premises at Akure from the 3rd day of August, 1999 until when the said premises is unlocked by the defendant or until when judgment is delivered. 5. An order compelling the defendant to produce and make c available to the plaintiffs, the plaintiffs Current Account 1 number 0050045005 and Current Account 2 number 0050045021 which the plaintiffs opened with the defendant bank at its Akure Branch in Ondo State. d 6. Court to give judgment on the plaintiffs’ indebtedness to the defendant as disclosed in the said statement of accounts in the said account numbers 005004005 and 0050045021.” Pleadings were duly filed and exchanged by the parties. e The appellant filed a counter-claim to the respondent’s claim wherein it claimed as follows:– (1) The sum of N2,762,569.37 being the outstanding f debt on account number 0050045005 as at 30 July, 1999 payable to the defendant. (2) The sum of N1,544,118.63 being outstanding debt as at 5 August, 1999 payable to the defendant. g In the instant case, the first respondent is the Chairman and Managing Director of the second respondent company. The second respondent is a customer to the appellant bank and maintained two current accounts at the appellant’s branch in h Akure, Ondo State. Sequel to the request of the second respondent for credit facilities sometimes in 1996, the appellant granted an overdraft facility of N1.5 million Naira to the second i respondent. The first respondent’s property situate at No. 31 (formerly No. 40) Mariatun House Isewa Street, Clerk Quarters was mortgaged as a collateral for the facility granted. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 39 a In 1997, an overdraft facility of N5 million Naira was granted by the appellant to the second respondent. The first respondent personally guaranteed the amount granted. In b addition, a deed of hypothecation was entered into between the appellant and the respondents. The second respondent failed to pay the credit facilities to the appellant in spite of repeated demands. The appellant c then took steps to enforce its right under the deed of hypothecation of stock of motor batteries in the custody of the second respondent. On 3 August, 1999 the appellant came to the business premises of the second respondent at d No. 28A, Ondo Road, Akure in Ondo State and insisted on taking over the management and control of the premises. When the respondents refused to the taking over of their business premises, the appellant sealed the said premises and e stationed both policemen and security men from their office to guard the premises for 24 hours. When all entreaties to the appellant to reopen the premises failed, the respondents on 11 August, 1999 instituted an action against the appellant f at the Owo High Court whereby they claimed the reliefs set out in their statement of claim dated 10 August, 1999. The appellant joined issues with the respondents by its statement of defence and counter-claim dated 28 September, g 1999. The respondents also filed a reply to the defendant’s statement of defence dated 29 September, 1999. The matter proceeded to trial. The respondents called three witnesses while two witnesses gave evidence for the h appellant. 22 exhibits were tendered during the trial. On 17 December, 2003 the court delivered judgment in the suit in favour of the respondents. The court granted the declaratory reliefs sought by the respondents and awarded to the i respondents general damages in the sum of N5,000,000 (five million Naira) and special damages in the sum of N1,580,000 (one million, five hundred and eighty thousand Naira) against the appellant for the sealing of the premises j of the second respondent. The appellants counter-claim was

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 40 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) dismissed. This is what the trial Judge said while giving a judgment to the respondents:– “1. A declaration that any attempt on the part of the defendants to sell by way of public auction or otherwise the 1st b plaintiff’s property at No. 31, Mariatun House (formerly No. 40) Asewa Street, Clerks Quarters, Owo in Ondo State which the 2nd plaintiff mortgaged with the defendant bank is unconstitutional, illegal, ultra vires, null and void. 2. A declaration that the 35% interest now being charged per c annum by the defendant on the overdraft facility granted to the 2nd plaintiff plus 12% interest on excess advised credit limit is unconstitutional, illegal, ultra vires, null and void. 3. N5,000,000.00 (Five Million Naira) being general damages d for the illegal sealing of the plaintiffs business premises at No. 28A Ondo Road, Akure in Ondo State. 4. N1,580,000.00 (One Million, Five Hundred and Eighty Thousand Naira only) being total loss of earning at the rate of N20,000.00 (Twenty Thousand Naira) per day multiplied e by 78 days (being the number of days for which the plaintiff business premises remained illegally.” The appellant being dissatisfied with the decision of the court appealed against the said judgment by a notice of f appeal dated and filed on 11 February, 2004 upon seven ground of appeal. The grounds of appeal without their particulars are set out below:– “1. The learned trial Judge erred in law when he said–– g ‘I hereby hold in agreement with counsel for the plaintiffs that there was in existence at all material time Central Bank Guideline between 1996 and 1999 and the rate of interest then was 21% (page 9 of the judgment)’. h 2. The learned trial Judge erred in law when he held– ‘In my view the two exhibits A4 and A5 constitute offers capable of acceptance . . . Mere silence of the plaintiffs as to the increase in rate of interest i communicated to the plaintiffs via exhibits A4 and A5 cannot be interpreted as acceptance because the plaintiffs did not protest’ (page 9 of the judgment). 3. The learned trial Judge erred in law when he held that the variation of interest rate from 21% to 33% and 35% is j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 41 a arbitrary and unconstitutional and that the prevailing maximum rate of interest in respect of credit facilities granted by the appellant to the respondents is 21% between 1996 and 1999. b 4. The learned trial Judge erred in law when he held that the appellant was responsible for the sealing of the respondents business premises on 3/8/99. 5. The learned trial Judge erred in law when he awarded the c sum of N1,580,000.00 (One Million, Five Hundred and Eighty Thousand Naira in favour of the respondents as special damages. 6. The learned trial Judge erred in law when he awarded the d sum of N5,000,000.00 (Five Million Naira) as general damages in favour of the respondent. 7. The learned trial Judge erred in law when he held that the appellant has failed to prove its counter- claim.” e In compliance with the rules of this Court, briefs of arguments were exchanged by respective Counsel. In the appellant’s brief settled by Olatunde Adejuyigbe, Esq, dated and filed on 28 September, 2004, seven (7) issues were f distilled from the seven grounds filed as calling for determination in the appeal. The issues read as follows:– (i) Whether the learned trial Judge was right in his finding as to the existence and contents of Central g Bank Guideline between 1996 and 1999 when the said guideline was not tendered in evidence by the respondents. (Ground 1) (ii) Whether the learned trial Judge was right when he h held that exhibits “A4” and “A5” constitute offers capable of acceptance and which cannot be effective without an acceptance by the respondents. (Ground 2) i (iii) Whether the appellant is entitled to increase the interest rate on the facilities granted to the second respondent above 21% per annum. (Ground 3) (iv) Whether the learned trial Judge was right in relying j on the evidence of PW3 for his finding that the

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appellant was responsible for the sealing of the a second respondent’s business premises on 3/8/99. (Ground 4) (v) Whether on the pleadings and evidence before the b court the learned trial Judge was right when he awarded the sum of N1,580,000 (one million, five hundred and eighty thousand Naira) as special damages to the respondents. (Ground 5) c (vi) Whether the sum of N5,000,000 (five million Naira) awarded by the learned trial Judge as general damages in favour of the respondents is proper and justifiable. (Ground 6) d (vii) Whether the learned trial Judge was right when he held that the appellant has failed to prove its counter- claim. (Ground 7) On the other hand, in the respondent’s brief settled by e Tokunbo Aderuboye, Esq, filed on 9/11/2004, he distilled five issues as calling for consideration from the grounds of appeal set out in the appellant’s notice of appeal. The issues formulated are as follows:– f (1) Whether between 1996 and 1999, there were Central Bank Guidelines pegging the rate of interest in respect of overdraft facilities at 21%. g (2) Whether the appellant illegally sealed up the respondent’s business premises. (3) Whether the respondents were entitled to special and general damages awarded to them. h (4) Whether the appellant’s counter-claim is properly before the court and/or whether same has been proved as required by law. (5) Whether the trial Judge’s findings of fact can be said i to be perverse. At the hearing of appeal learned Counsel for the appellant relied and adopted the appellant’s brief of argument dated and filed on 28/9/2004 and the appellants reply brief dated j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 43 a and filed on 16/2/2005 and urged us to allow the appeal. The learned respondent’s Counsel adopted and relied on their brief dated 8/11/2004 and urged us to dismiss the appeal. b In the determination of this appeal, I will adopt the issues as formulated by the appellant as it is more apt and encapsulates all the issues raised in the appeal. c It is observed by the learned respondent’s Counsel in his brief of argument that the seven (7) issues raised for determination by the appellant from the seven grounds of appeal filed by him shows that the appellant merely argued the grounds of appeal rather than arguing the issues for d determination. Learned Counsel cited the cases of Zaccheus Abiodun Koya v United Bank for Africa Ltd (1997) 1 NWLR (Part 481) 251; (1997) 46 LRCN 1; Abubakar v The Government of Taraba State and another (1997) 51 LRCN e 1479 at 1505, that in arguing appeals Counsel are to rely on the issues formulated rather than the grounds of appeal filed. That it is on the basis of the issues that the parties found their contention. f The desirability of formulating issues are so that the material errors sought to be corrected in a judgment on appeal are identified most time, and quite advisedly in appropriate cases from a number of grounds of appeal in g which complaints have been laid in respect of the judgment. The Court and Counsel will then be better able to focus on the resolution of those issues not by taking grounds of appeal one after the other. That is not helpful. It is the issues h that should be the centre of attention and not the grounds in highlighting the complaints brought before the Court in the grounds of appeal under such issues. Generally grounds of appeal highlight the error being sought to be corrected in the i judgment. As said it is not helpful to argue grounds but issues that act as a mirror reflecting the grounds of appeal. See Busari v Oseni (1992) 4 NWLR (Part 237) 557. However, where such is the case, the argument cannot be j disregarded by the court.

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The appellant also in his reply brief attacked the a respondent’s issues 4 and 5 formulated by the respondent as being incompetent. On issue 4 it is argued that the learned trial Judge having specifically found that the counter-claim b is competent and properly before the court, the respondent cannot challenge the competence of the counter-claim as to whether it is properly before the court in the absence of any cross-appeal by the respondent on the issue. That it is not c also an issue that arises from the appellant grounds of appeal citing the following cases: Oshodi v Eyifunmi (2000) 13 NWLR (Part 684) 298 at 332; Obasanjo v Buhari (2003) 17 NWLR (Part 850) 510 at 554; Sha (Jnr) v Kwan (2000) 8 NWLR (Part 670) 685 at 700. d That issue 5 as formulated by the respondents is also incompetent as it does not fall within the scope of or related to the ground of appeal filed by the appellant citing Adelaja e v Fanoiki (1990) 2 NWLR (Part 131) 137 at 148; Ojegbe v Omotsone (1996) 6 NWLR (Part 608) 591 at 598. We were urged to strike it out. It is the law that a respondent cannot formulate issues f outside grounds of appeal filed by the appellant unless he files a cross-appeal or a respondent’s notice. The Supreme Court in Idika v Erisi (1988) 2 NWLR (Part 78) 563 said that a respondent has no business, unless he cross-appeals or at least serves a respondent’s notice framing issues outside g the grounds of appeal filed by the appellant. See also Eze v Federal Republic of Nigeria (1987) 1 NWLR (Part 51) 506. A respondent who did not cross-appeal can only adopt the issues as formulated in the appellant’s brief based on the h grounds of appeal filed by the appellant or at best recast them by giving them a slant favourable to the respondents’ point of view but without departing from the complaint raised by the grounds of appeals. See Atanda v Ajani (1989) i 3 NWLR (Part 111) 511. Any issue not in consonance with the grounds of appeal filed does not fall for determination. In respect of respondent’s issue 4, the issue whether the appellant’s counter-claim is properly before the court or not j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 45 a is not the issue decided by the lower court and not raised by the appellant’s grounds of appeal. The issue posed on these grounds can only be raised by the respondent subject to b across-appeal being filed in view of the finding of the learned trial Judge that the counter-claim is competent and properly before the court. If a finding or decision of a trial court, whether on an issue of fact or law is not challenged in c an appeal to the Court of Appeal, such a finding or decision, rightly or wrongly must not be disturbed for the purpose of the appeal in question. See Oshodi v Eyifunmi (supra). I agree with the learned Counsel for the appellant that the d respondent who did not lodge any cross-appeal against the decision of the learned trial Judge as to the competence of the counter-claim cannot attack the decision of the lower court in their brief or invite this Court to adjudicate on same. e In the absence of a cross-appeal, the respondents have no business to challenge the decision of the trial court in this Court. The courts have stated a number of times that the f traditional role of a respondent in appeal, is to defend the judgment or ruling appealed against. If however, a respondent wishes to depart from this role by attacking or challenging the judgment or ruling in anyway, he or she is g enjoined to file a cross-appeal since the main purpose of a cross-appeal is to correct an error which is in the main appeal. See Obasanjo v Buhari (2003) 17 NWLR (Part 850) 510 at 554 per Kalgo, JSC. For this reason the objection by h the appellant is upheld. On the respondents’ issue five formulated for determination, I also agree with the learned Counsel for the appellant that it is in competent as it does not fall within the i scope of or relate to the grounds of appeal filed by the appellant. I think all that it means is that based on the pleadings of the parties and the evidence adduced, whether the finding of j the learned trial Judge can be said to be perverse. Where an

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 46 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) issue is not covered by any of the grounds of appeal filed, it a is incompetent and will be struck out. See Sha (Jnr) v Kwan (supra). An issue for determination in an appeal is distilled from b the grounds of appeal. An issue not tied to any of the grounds of appeal is improper and will not be countenanced. In the instant case, the respondents issue five does not arise from any of the appellant’s grounds of appeal. See Nkpedem c v Udo (2000) 9 NWLR (Part 673) 631. It is a common ground in the instant appeal that the respondent did not cross-appeal and to that extent he cannot postulate an issue for determination which is not predicated d on an existing ground of appeal. Such a postulation is misconceived and therefore incompetent. It is therefore imperative for Counsel formulating issues for determination to keep in mind that any issue not in consonance with the e grounds of appeal does not fall for determination. See Ebo v Nigerian Television Authority (1996) 4 NWLR (Part 442) 314; Eze v Federal Republic of Nigeria (1987) 1 NWLR (Part 51) 506. It is therefore my view as rightly submitted by f the appellant’s counsel that the respondent’s issue five for determination is incompetent and it is hereby struck out. Having disposed of the preliminary issues in this appeal, I will now turn to the appeal proper. g Issue one is whether the learned trial Judge was right in his finding as to the existence and contents of Central Bank Guidelines between 1996 and 1999 when the said guideline was not tendered in evidence by the respondent. h Learned Counsel for the appellant referred to paragraphs 23 and 25 of the respondent’s statement of claim wherein he pleaded the Central Bank Guidelines and contended that the appellant acted in violation of the guideline. He also referred i to paragraph 5 of the respondent’s statement of defence to the appellant’s counter-claim wherein it was stated that they place reliance on the Central Bank Guideline. It is submitted that by paragraph 11 of the statement of defence j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 47 a and counter-claim, the appellant averred that there is no Central Bank Lending Policy Guideline regulating interest rates on loan and overdraft facilities and/or limiting same to b a maximum amount of 21% per annum. It is submitted that it is trite law that he who asserts must prove referring to the case of Ibrahim v Ojomo (2004) 4 NWLR (Part 862) 89 at 110 and submitted that the onus is on the respondents to proffer legally admissible evidence as to the existence and c contents of the Central Bank Guideline. Learned Counsel referred to the evidence of PW1 under cross-examination where he stated that he has seen the Central Bank of Nigeria Guidelines before and the evidence of PW2 also under d cross-examination where he also admitted seeing the Central Bank of Nigeria Guidelines for the period 1996 to 1999 and submitted that the respondents who have the onus of proving the existence and contents of the document have failed to e tender it in evidence. It is submitted that a party who seeks to rely on a document which is relevant to an issue before the court must produce the document citing FATB Ltd v Partnership Investment Co Ltd (2003) 18 NWLR (Part 851) f 35 at 74; Bamgbose v Jiaza (1991) 3 NWLR (Part 177) 64 at 74; Kara v Wassah (2001) 18 NWLR (Part 744) 117 at 138. It is further submitted that the failure of the respondents to tender the Central Bank of Nigeria Guidelines as exhibit precludes the Court from relying on it as the Court is not g permitted to engage in speculation as to the existence and content of a document not produced before it, referring to the cases FMF Ltd v Ekpo (2004) 2 NWLR (Part 856) 100 at 120; Gbajor v Ogunburegui (1961) All NLR 853; h Mercantile Bank of Nigeria Plc v Nwobodo (2000) 3 NWLR (Part 648) 297 at 319. It is also submitted that the learned trial Judge fell into grave error when he made findings as to the existence i and contents of a Central Bank of Nigeria Guideline between 1996 and 1999 which was not tendered in evidence by the respondents. It is contended that such finding is based on speculation and imagination citing Ivienagbor v j Bazuaye (1999) 9 NWLR (Part 620) 552 at 561. It is further

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 48 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) submitted that it was wrong for the learned trial Judge to a base his finding on the submissions of the respondent’s Counsel regarding the Central Bank of Nigeria Guideline when the document itself was not produced in court citing b Chukujekwu v Olalere (1992) 2 NWLR (Part 221) 86 at 93; Ishola v Ajiboye (1998) 1 NWLR (Part 532) 71 at 81; Aro v Aro (2000) 3 NWLR (Part 649) 443 at 457. It is submitted that the finding by a trial Judge is perverse c citing Iwuoha v NIPOST Ltd (2003) 8 NWLR (Part 822) 308 at 334. We were urged to set aside the perverse finding of the trial court citing Iloabuchi Ebigbo (2000) 8 NWLR (Part 668) 197 at 227. We were urged to resolve this issue in d favour of the appellant and set aside the perverse finding of the learned trial Judge as to the existence and contents of Central Bank of Nigeria Guideline between 1996 and 1999. In his response, learned respondent Counsel submitted e that there were Central Bank Guidelines regulating interest rate at 21% between 1996 and 1999. Learned Counsel referred to overdraft facilities granted to the second respondent in 1996 and 1999 by the appellant, exhibits “A3” f and “D1” that in both letters of offer ie exhibits “A3” and “D1” interest rate was put at 21%. Learned Counsel referred to the Deed of Hypothecation exhibit “A2” wherein it was clearly stated therein on page 1 as follows:– g “UNIVERSAL TRUST BANK OF NIGERIA LIMITED MAXIMUM LENDING RATE OF 21% PER ANNUM”. Learned Counsel referred to the definition of the word “Maximum” from Collins English Dictionary as meaning h the greatest possible amount, degree, highest value of a variable quantity. It is the view of respondents’ counsel that having adduced evidence to the satisfaction of the court, as required by sections 136 and 137(1) of the Evidence Act and tendered exhibits “D1”, “A2” and “A3” in support, the i burden of proof now shifted to the appellant under sections 137(2) and 138 of the Evidence Act to adduce evidence in rebuttal. It is also his view that the position of the respondent is further strengthened by the evidence of DW2 j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 49 a who contrary to the appellant’s pleadings and evidence admitted that there was a Central Bank Lending Policy. He cited and relied on the following cases:– b (1) Chief Victor Woluchem and others v Chief Simon Gudi and others (1981) 5 SC 21; and (2) Niger Construction Ltd v Chief AA Okugbemi (1987) 11 – 12 SCNJ 133 at 135; (1987) 4 NWLR (Part 67) c 787. It is further submitted that the issue at stake is whether or not there was a Central Bank Lending Policy. That while the respondents said there was, the appellant said there was d none but that DW2 said there was such a policy. It is the view of Counsel that what is admitted needs no further proof. That since DW2 conceded to the existence of Central Bank Lending Policy, it is of no use or relevance for the e respondents to tender any document in proof of same citing Steven Omo Ebueku v Sunmonu Amola (1988) 3 SCNJ (Part II) 207 at 209; (1988) 2 NWLR (Part 75) 128. He also cited the following case on the interpretation of statute: GMBU v f Rivway Lines Ltd (1998) 58 LRCN 3485 at 3488; Lt General Ishaya Bamayi v A-G of the Federation and others (2001) 90 LRCN 2738 at 2744; (2001) 12 NWLR (Part 727) 468. It is also the view of the learned Counsel that since there is no g appeal against the finding of the trial court that it has power to intervene, the appellant is deemed to have accepted the correctness of the finding citing Zaccheus Abiodun v United Bank for Africa Ltd (1997) 46 LRCN 1 at 14. That the interpretation of exhibits “A4” and “A5” by the trial court is h perfect and in order and that even if it is otherwise the said finding is not perverse because the lower court relied on other documents before it before reaching the conclusion that the maximum rate of interest is 21%. Learned Counsel i urged us to resolve this issue against the appellant. It is a principle of our law that he who asserts must prove. Section 136 of the Evidence Act, 1990 provides:– “The burden of proof in a suit or proceeding lies on that person j who would fail if no evidence at all were given on either side.”

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Section 137(1) of the Act further provides:– a “In civil cases the burden of first proving the existence or non- existence of a fact lies on the party against whom the judgment of the court would be given if no evidence were produced on either b side, regard being had to any presumption that may arise on the pleadings.” See also Ibrahim v Ojomo (supra); Okechukwu v Ndah (1967) NMLR 368; NBN Ltd v Opeola (1994) 1 NWLR c (Part 319) 126; Chukujekwu v Olarele (1992) 2 NWLR (Part 221) 80; FMF Ltd v Ekpo (2004) 2 NWLR (Part 856) 100. The issue now is whether or not there was a Central Bank of Nigeria Lending Policy between the period 1996 and d 1999 that pegged the interest rate at 21% per annum as argued by the respondents? It is the case of respondents that there was a Central Bank Lending Policy while the appellant said there was none and, e whether the learned trial Judge’s finding that there was such a policy when same has not been produced before it is perverse. It is settled law that a party who seeks to rely on a document which is relevant to an issue before the court must f produce the document before the court for the court to examine, assess and act on same. Documentary evidence where this is relevant, ought to be produced and tendered as they speak for themselves as against the ipse dixit of a witness in respect of such transactions which may not be g readily accepted by the court. See FATB Ltd v Partnership Investment Company Ltd (supra). Where a party leads evidence as to the existence of a h document on a particular issue before the court, the best evidence is the production of the document, unless it is proved to the satisfaction of the court that the document itself cannot be produced. In the instant case, the respondents as rightly submitted by the appellant’s Counsel, i did not tender the Central Bank of Nigeria Guidelines as an exhibit and led no evidence that the Central Bank of Nigeria Guidelines cannot be produced. What then is the basis of the lower court’s finding based on the Central Bank of Nigeria j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 51 a Guidelines? Could such a finding by the lower court in the absence of the Central Bank of Nigeria Guidelines placed before it be said to be perverse as contended by the b appellant’s counsel? It is my humble view that to answer the question, one must consider the pleadings of the parties and the evidence led thereon in proof of the claims before the court and the findings of the learned trial Judge. c In coming to the conclusion that there is such a policy, the learned trial court relied on the evidence of DW2, when he testified at page 53 lines 30-34 of the record that: “The loans advanced to the plaintiffs are interest yielding loans. The d Bank dictates the rate of interest based on cost of funds and prevailing regulation by the Central Bank of Nigeria.” This witness stated further regarding the existence of the Central Bank Lending Policy on re-examination at page 54 lines 6 – e 12 of the record of appeal, that: “The cost of funds dictates the rate of interest of loan facilities and credit monitory guidelines issued by the Central Bank of Nigeria from time to time. The learned trial Judge found that the said evidence f coming from the appellant’s witness is evidence against interest and found same to be admissible against the appellant that the said evidence amounts to an admission as to the existence of Central Bank Regulations citing Kamalu v Umunna (1997) 5 NWLR (Part 505) 321 at 336. The g learned trial Judge concluded as follows:– “Since the maximum rate of interest payable on loan, overdraft and credit facilities is dictated by costs of funds and the Central Bank Guidelines issued from time to time, I hereby hold in h agreement with the counsel for the plaintiffs that there was in existence at all material time Central Bank Guidelines between 1996 and 1999 and the rate of interest then was 21%.” It is my humble view that this finding by the learned trial i Judge cannot be said to be perverse considering the circumstances of this case and same cannot be said to be speculative. It is now settled that a court cannot decide issues on speculation no matter how close what it relies on j may seem to be to the facts. See Ivienabor v Bazuaye

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(supra); Overseas Construction Co Ltd v Creek Enterprises a Ltd (1985) 3 NWLR (Part 13) 406. In the same vein, the court does not speculate on the contents of a document not produced before it. See Gbajor v Ogunburegui (supra). b However, in its facts-finding mission a court is allowed to infer the existence or otherwise of certain things which is a reasonable deduction from facts whereas speculation is not. In the instant case, the finding by the learned trial Judge c could not have been otherwise even without the Central Bank Guidelines placed before it to find that the interest rate chargeable from the overdraft facilities granted to the respondents is 21%. This is so in view of exhibits “A2”, the deed of hypothecation of goods dated the 5/2/98 to secure d the overdraft facility of N5 million Naira dated 18/11/96 and exhibit “D1” offer letter of renewal of credit facility of N1.5 million Naira dated 9/9/97 which documents constitute the agreement of the overdraft facilities granted by the appellant e to the respondents. In exhibits “A2”, “A3” and “D1”, the maximum rate of interest is 21%. In view of the above, it is my considered view that the finding of the learned trial Judge as to the existence of a Central Bank Guideline that f pegged interest rate at 21% between the 1996 and 1999 is neither perverse nor speculative in view of exhibits “A2”, “A3” and “D1”, and I so find. This issue is resolved against the appellant. g Issue two is whether the learned trial Judge was right when he held that exhibits “A4” and “A5” constitute offers capable of acceptance and which cannot be effective without an acceptance by the respondents. h It is the view of the appellant’s Counsel that the general rule of interpretation is that where the words of a document are unambiguous, the operative words should be given their simple and ordinary grammatical meaning citing:– i UBN v Ozigi (1994) 3 NWLR (Part 333) 385 at 403 and Inyang v Ebong (2002) 2 NWLR (Part 751) 284 at 329. It is also the view of the learned Counsel that there is nothing in exhibits “A4” and “A5” which suggest or indicate j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 53 a that the review of interest rates by the appellant is expressed as an offer which is capable of an acceptance by the second respondent. It is submitted that what the appellant by b exhibits “A4” and “A5” did was to convey to the second respondent its decision to review upwards the interest rate applicable to the overdraft facility of the second respondent and the effective date of the new interest rates. c It is the view of the learned Counsel that if exhibits “A4” and “A5” which are unambiguous had been given their simple and ordinary grammatical meaning the learned trial Judge would not have come to the strange and erroneous conclusion that the two exhibits constitute an offer capable d of acceptance and that the respondent must first convey its acceptance before the reviewed interest rates can be effective. It is submitted that the finding of the lower court in respect of exhibits “A4” and “A5” is perverse and e unjustifiable as it is not supported by the contents of the said exhibits. Learned Counsel referred to the following cases, Odiba v Azege (1998) 9 NWLR (Part 566) 370; Udengwu v Uzuegbu (2003) 13 NWLR (Part 836) 136. We were urged f to set aside the perverse finding and resolved the issue in favour of the appellant. However, it is the view of the respondent’s Counsel that the interpretation of exhibits “A4” and “A5” by the lower g court is perfect and in order. It is his view that, assuming without conceding that this Court hold that the contents of the two exhibits were wrongly interpreted, it is submitted that the interpretation or findings cannot be said to be h perverse because the lower court relied on other documents before reaching the conclusion that the maximum rate of interest is 21%. Exhibits “A4” and “A5” are letters dated 11 May, 1999 i and July 23, 1999 written by the appellant to the first respondent, the Managing Director of the second respondent with caption “Review of Interest Rates”. By exhibits “A4” and “A5” the appellant notified the second respondent that j the interest rate applicable to the overdraft facility has been

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 54 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) reviewed upward. Exhibits “A4” and “A5” provide inter a alia:– Exhibit A4 “Universal Trust Bank of Nigeria Ltd b Akure NICON House 211, Arakale Street, Akure, Ondo State. c Tel– 034-231720,230095, 232094 Fax– 034-242094 RC 64591 d 11 May, 1999. The Managing Director Adamaco Nigeria Ltd. 28A Ondo Road, Akure. e Attention– Alh Adams Ajagbule Dear Sir, REVIEW OF INTEREST RATES In view of the present volatility in the money market rates f occasioned by the incessant debit of banks by the CBN for mandatory special treasury bills purchased without notice which has resulted in the over all tight liquidity in the banking system and its attendant upward movement in money market rates, we are g constrained to review our interest rates upward. Accordingly, with effect from 14 May, 1999, the interest rate applicable to your overdraft facility has been reviewed upward to 33% per annum. However, excess above the advised credit limit will attract additional interest charges at 12% per annum. h The advised rates are subject to change from time to time in response to developments in the money market. Thank you for your continued patronage and for believing in us. Yours faithfully, i For– Universal Trust Bank Plc.

(SGD) (SGD) Kola Omomowo P.A.O. Olalemi Asst. Officer (Credit/Mktg) Branch Manager”. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 55 a Exhibit A5 “Universal Trust Bank of Nigeria Ltd Akure b NICON House 211, Arakale Street, Akure, Ondo State. Tel– 034-231720, 230095, 232094 c Fax– 034-242094 RC 64591 July 23, 1999 AKB/26079902/WO/PAO.eas d The Managing Director Adamaco Nigeria Ltd 28A Ondo Road, Akure. e Attention– Alh. Adams Ajagbule Dear Sir, REVIEW OF INTEREST RATES The recent changes in the money market have resulted in an f upward review of rates. In light of this situation, we are constrained to review our interest rates upwards on all borrowing facilities with effect from 26/07/99. We hereby advise that interest rate applicable to your overdraft g facility has been reviewed upwards to 35% per annum. However, excess above the advised credit limit in addition to expired and outstanding credit facility shall attract additional interest charges on 12% per annum. The advised rates are subject h to changes from time to time in response to developments in the money market and would be reviewed downwards as soon as the market situation permits. Thank you for your continued patronage and for believing in us. Yours faithfully, i For– Universal Trust Bank Plc.

(SGD) (SGD) Wole Oni P. A. O. Olalemi j Credit/Mktg Officer Branch Manager”.

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The question is, whether exhibits “A4” and “A5” are offers a capable of acceptance which cannot be effective without acceptance by the respondents. It is my considered view that, to appreciate the fact b whether exhibits “A4” and “A5” are offers capable of acceptance, it is necessary to examine the documents constituting the agreement between the parties whether the agreement empowers the appellant to vary the interest rate c chargeable on the overdraft facility from time to time such that it can unilaterally adjust the rate of interest charged from the overdraft facilities. A careful perusal of exhibit “A2” Deed of Hypothecation d of Goods, exhibit “A3” offer letter dated the 18/11/96 and exhibit “D1”, offer letter dated 9/9/97, which in my view constitute agreement in respect of the overdraft credit facilities the appellant granted the respondents is necessary. e In exhibits “A2”, “A3” and “D1”, all fixed the maximum lending interest rate by the appellant at 21%. There is no clause contained in all the above mentioned exhibits that empowers the appellant to vary the interest chargeable on f the loan or overdraft credit facilities from time to time such that it can unilaterally adjust the rate of interest charged on such overdraft facility without notice to the respondents. See Bank of the North Ltd v Idirisu (2000) 3 NWLR (Part 649) 373. g In the absence of such a clause contained in the contract agreements, what then is the legal effect of exhibits “A4” and “A5”? Are they offers capable of acceptance or are they h automatically binding on the respondents? In the instant case, where the terms and conditions as to the interest rate payable are specifically stated in the documents constituting the agreement between the parties, any variation of the interest rate must be signified to the respondent’s in writing. i The general rule is that where the parties have embodied the terms of their contract in a written document, extrinsic evidence is not admissible to add to, vary, subtract from or contradict the terms of the written instrument. This is also j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 57 a provided for in section 131(1) of the Evidence Act. The appellants cannot therefore unilaterally adjust the rate of interest charged. See Bank of the North Ltd v Idirisu (2000) b 3 NWLR (Part 649) 373; UBN Ltd v Ozigi (1994) 3 NWLR (Part 333) 385; Union Bank v Sax (Nig) Ltd (1994) 8 NWLR (Part 361) 150. Exhibits “A4” and “A5” are therefore offers capable of c acceptance by the respondents. Acceptance is an unconditional assent communicated by the offeree to the offeror. It is therefore my humble view that the finding of the learned trial Judge that exhibits “A4” and “A5” d constitute offers capable of acceptance is neither erroneous nor perverse. I agree with the learned trial Judge that the variation from the agreed interest rate of 21% to 33% and 35% on 11 May, 1999 and 23 July, 1999 within a period of two months and eleven days is not only arbitrary but also e unconstitutional as the increases are out of time with the agreed rate of interest as contained in exhibits “A2”, “A3” and “D1”. This issue is also resolved against the appellant. f Issue three is whether the appellant is entitled to increase the interest rate on the facilities granted the second respondent above 21% per annum. It is the view of the learned appellant’s Counsel that the g terms of the overdraft facilities granted by the appellant to the second respondent as contained in exhibits “A3” and “D1” are duly accepted by the second respondent and therefore the parties are bound by the terms and conditions contained in exhibits “A3” and “D1” and that the interest h rate stated as UTB’s maximum lending rate “currently 21%” clearly underscores the element of variation of the lending interest rate of the appellant. It is submitted that the insertion of the phrase “currently 21%” is beyond argument that its i maximum lending interest rate is not fixed at 21% but subject to variation from time to time. It is also submitted that the tripartite deed of legal mortgage exhibit “A1” duly executed by the appellant and the respondents equally j empowers the appellant to vary the lending interest rate on

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 58 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) the overdraft facilities granted to the respondents. Learned a Counsel referred to clause 2 of exhibit “A1” and submitted that from the contents of exhibits “A1”, “A3” and “D1”, the review of lending interest rate by the appellant is clearly b within the contemplation of the appellant and the respondents and the appellant is therefore entitled to review the interest rate upwards. Citing UBN Ltd v Ozigi (1994) 4 NWLR (Part 333) 385; UBN Ltd v Sax (Nig) Ltd (1994) 8 c NWLR (Part 361) 150; Bank of the North Ltd v Idirisu (2000) 3 NWLR (Part 649) 373. It is therefore submitted that it is not permissible for a court of law to make any finding outside the evidence placed before it by the parties citing Idonidoye-Obu v NNPC (2003) 2 NWLR (Part 805) d 589 at 650. We were urged to resolve the issue in favour of the appellant. In dealing with this issue, it is relevant to consider e exhibits “A1”, “A3” and “D1”, documents constituting the agreement between the parties. Exhibits “A3” and “Dl” provides inter alia as follows:– Exhibit A3 “Universal Trust Bank of Nigeria f Ltd Akure Branch NICON House 221, Arakale Street, g P.M.B. 655, Akure Akure, Ondo State. Tel– 034-231720,230095 h Fax– 034-242094 RC 64591 18 November, 1996 AKB/1124885/96/MAA/AOB.fba i The Managing Director Adamaco Nigeria Ltd 28A Ondo Road, Akure. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 59 a Attention– Alh. Adams Ajagbule Dear Sir, OFFER LETTER b We are pleased to advise that Universal Trust Bank of (Nig.) Ltd. has approved renewal of our line of credit for your company under the following terms and conditions. FacilityA c Amount– N750,000 (Seven Hundred and Fifty Thousand Naira Only) Providing for– Overdraft on current account Purpose– Working capital financing d Pricing– Interest rate– UTB’s max lending rate currently 21% p.a. COT– 3 per mile Repayment– From operational cash flow Tenor– 90 days e Security/Support (1) Legal mortgage on a landed property of Alh. Adams Ajagbule situated at No. 40 Clerks Qtrs., Ondo State. (2) Hypothecation of stock of motor batteries for N2.0 million. f (3) Personal guarantee of the Managing Director, Alh. Adams Ajagbule for N1.5 million.” Exhibit D1 “Universal Trust Bank of Nigeria g Ltd Akure, Branch 221, Arakale Street, h P.M.B. 655, Akure Tel– 034-23 1720, 230095 RC 63491 9 September, 1997 i AKB/1112706/97/RAY/AOB. Fba The Managing Director Adamaco Nig. Ltd. Ondo Road, Akure. j Attention– Alh. Adams Ajagbule

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Dear Sir, a OFFER LETTER We are pleased to advise that Universal Trust Bank of (Nig.) Ltd. has approved renewal of our line of credit for your company under b the following terms and conditions. FacilityA Amount– N1,500,000.00 (One Million, Five Hundred Thousand Naira Only) c Providing for– Overdraft on current account Purpose– Working capital financing Pricing– Interest rate– UTB’s max lending rate currently 21% COT– 3 per mile Repayment– From operational cash flow d Tenor– 365 days (subject to 90-day clean up cycle) Security– (1) Legal mortgage on a landed property of Alh. Adams Ajagbule situated at No. 40 Clerks Qtrs, Ondo State. e (2) Hypothecation of stock of motor batteries for N5,000,000.00 (3) Personal guarantee of the Managing Director, Alh. Adams Ajagbule for N6.5 f million.” From the evidence available before the lower court, it is clear that the terms of the overdraft facilities granted by the appellant to the second respondent are as stated in the offer g letter of 18 November, 1996 exhibit “A3” and the offer letter of 9 September, 1997 exhibit “D1”. It is not in dispute that the terms and conditions stipulated therein were duly accepted by the second respondent. The interest rate stated h therein in exhibit “A3” and “D1” is stated as 21%. Clause 2 of exhibit “A1”, the Tripartite Deed of Legal Mortgage dated 11 November, 1992 read:– “2. While it is the bank’s intention that this facility shall i continue to be available to the borrower until the 30 July, 1993 the bank reserves the right to terminate the facility at any time by notice to the borrower in writing. At such time, the facility will cease to be available and all out standings including, interest and other sums for which the borrower j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 61 a may be liable will become due and payable and also the borrower covenants to pay interest on the balance of the said current account and . . . on any other account and on all monies owing to the bank at the rate of (0.5%) per annum b above the bank’s prime lending rate ruling from time to time. The bank’s prime rate is declared currently at 29% giving an initial gross interest rate of (29.5%) per annum. Interest shall be payable monthly in arrears from the date of initial draw c down or at such other rates and at such other times as the bank may from time to time determine provided always that if the interest or any interest payable on any arrears of interest capitalized under this proviso shall remain unpaid for 2 (two) weeks after the date on which the same ought to have d paid the same shall be added for all purpose to the balance of monies hereby secured (unless the bank shall otherwise by writing expressly elect) and shall thenceforth bear interest payable at the rate and on the days aforesaid and the covenants and provisos contained in these presents and rules e of law or equity in relation to interest on the said balance shall equally apply to interest on such arrears.” A careful perusal of Clause 2 shows that the facility granted the respondents under this deed of Tripartite Legal Mortgage f is available to the borrower, that is the respondents in the instant case until 30 July, 1993 with the right of the bank ie the appellant to terminate the facility at any time by notice in writing to the borrower. Where the bank decides to exercise g this option ie to determinate the facility, then all outstandings, including interest or other sums the borrower may be liable to and payable to the bank at the rate of 0.5% above the bank prime interest rate declared at 29% giving h the initial interest of 29.5% per annum. The clause went on to provide:– “Interest shall be payable monthly in arrears from the date of initial drawdown or at other rates and at such other times as the i bank may from time to time determine . . .” The key word here is “drawdown”. If the entire clause is construed as a whole it will be clear that the interest rate being referred to is the interest payable by the borrower after j the termination of the facility granted by the bank on the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 62 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) unpaid outstandings due to the bank. “Drawdown” is an act a of drawing an available loan facility granted by the bank to the borrower. It is my humble view that the reference to “as the bank may from time to time determine . . .” means the b interest on the outstanding balance due to the bank from the borrower from the date of the initial drawdown. It is trite law that, in construing a statute, the clause will be considered as a whole and not just a part of it in order to c ascertain and fully understand its full meaning, scope and effect.

It is a fundamental principle of interpretation of the words d of a statute that where the words used are clear and unambiguous should be given their ordinary meaning. See Bamaiyi v A-G of the Federation (2001) 90 LRCN 2738, (2001) 12 NWLR (Part 727) 468; Niger Progress Ltd v NEL e Corporation (1989) 3 NWLR (Part 107) 68; Garba v Federal Civil Service Commission (1988) LRCN 3485; (1989) 1 NWLR (Part 71) 449. In the instant case, exhibit “A1”, the Tripartite Deed of f Legal Mortgage was executed on 11 November, 1992 for a facility available until 30 July, 1993. The overdraft facilities granted the respondents by exhibits “A3” and “D1” were granted in 1996 and 1997. The nature of the relationship g between exhibits “A3” and “D1” with exhibit “A1”, the Tripartite Deed of Legal Mortgage does not confer on the appellant the right to charge interest rate arbitrarily. In the circumstances also, I do not agree with the h submission of the learned Counsel for the appellant that the ward “currently” used in exhibits “A3” and “D1” is enough to clothe the appellant with power to unilaterally increase the interest rate from 21% to 33% and 35% within a period i of 2 months and 11 days in the absence of any express provision to that effect in the contract agreement. This is arbitrary use of power and it is therefore unconstitutional and null and void and I therefore so hold. Based on the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 63 a above findings, this issue is also resolved against the appellant. Issue four (4) is whether the learned trial Judge was b relying on the evidence of PW3 for his finding that the appellant was responsible for the sealing of the respondent’s business premises on 3/8/99. c Learned Counsel for the appellant considered the evidence adduced by PW3 vis-à-vis the pleadings of the respondents and submitted that the evidence of PW3 is at variance with the pleadings of the respondents. It is d submitted that parties are bound by their pleadings and any evidence led on facts not pleaded goes to no issue and must not be allowed at the trial. It is submitted that in paragraph 9 of the reply to the statement of defence, the respondents referred to the petition of the appellant to the police on 27 e August, 1999 but said nothing as to what happened sequel to the petition. It is the view of learned Counsel that if the learned trial Judge had adverted his mind to the pleadings of the respondents, he would have discovered that the evidence f of PW3 goes to no issue and therefore has no probative value. He relied on the authority of FATB Ltd v Partnership Investment Co Ltd (2003) 18 NWLR (Part 851) 35 at 57. The Court was urged to expunge the evidence of PW3 from g the record in line with the decision of the Supreme Court cited above. It is further submitted that the evidence of PW3 had no connection with the parties before 27/8/99 when the petition of the appellant was received by the Commissioner h of Police. That PW3 did not mention 3/8/99 as the date the respondent’s business premises was separate by the appellant (sic). We were urged to resolve this issue in favour of the appellant. i In his submission, learned Counsel for the respondents referred to a content of petition dated 27/8/99 written by the appellant against the first respondent to the Commissioner of Police, Akure, Ondo State exhibit “D10” and submitted that j the content of the petition reveals it all. Learned Counsel

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 64 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) also referred to the evidence-in-chief of PW3 and under a cross-examination that the respondent’s business premises was sealed up by the appellant. It is submitted that exhibit “D10” is an admission against interest and that what is b admitted needs no further proof. That the evidence is not contradicted and the court has no alternative but to accept the evidence citing Ebueku v Amola (1988) 3 SCNJ (Part 11) 207 at 209; (1988) 2 NWLR (Part 75) 128; Olujinle v c Adeagbo (1998) 4 SCNJ 1 at 15; (1988) 2 NWLR (Part 75) 238. That the evidence of DW1 and DW2 relating to the sealing of the premises is hearsay and therefore inadmissible d as both DW1 and DW2 were not around at the time the premises was sealed. We were urged to resolve the issue against the appellant. To appreciate this issue fully it is necessary in my view to e go back to the pleadings of the parties and the evidence adduced thereunder to determine whether the appellant was responsible for the sealing of the respondent’s business premises. Respondents’ statement of claim, particularly f paragraphs 28, 29, 30 and 31 are relevant. They are hereby reproduced:– “28. In the light of paragraphs (26 and 27) above, the plaintiffs were shocked and embarrassed when on the 3rd day of g August, 1999, the defendant came to the plaintiffs’ premises at No. 28A Ondo Road, Akure in Ondo State and forcibly sealed the said business premises. 29. Further to paragraph (28) above, the defendant informed the plaintiff that the plaintiffs’ company will remain sealed until h and unless the plaintiffs allow the defendant to take over the control and management of the plaintiffs’ company. 30. The plaintiffs in reaction to paragraphs (28 and 29) above state that the plaintiffs informed the defendant that the action i of the defendant amounts to self help in that there is no agreement oral or written to that effect. The said premises is still under lock and key up to this moment. 31. The plaintiffs aver that the defendant has threatened to sell by way of public auction, the 1st plaintiff’s property situate j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 65 a at No. 31, Mariatun House (formerly No. 40) Asewa Street, Clerks Quarter, Owo in Ondo State which the plaintiffs mortgaged with the defendant bank except the plaintiffs allow the defendant to take over the control and management b of the plaintiffs company.” In response, the appellant averred in paragraph 13(a) – (e) as follows:– “13. The defendant states with reference to paragraphs 28, 29, 30 c and 31 of the statement of claim as follows–– (a) The defendant has a charge on the stock of the plaintiff’s business premises at Nos. 28 and 29 Ondo Road, Akure under the Deed of Hypothecation recited d above in. (b) The defendant has a right of control over the plaintiffs’ business premises and stock as agreed by the parties and evidenced by the letter dated 9 September, 1997. e (c) The plaintiffs allowed the defendant to exercise its right of dual control of the stock and premises until 6th of August, 1999 when it absconded in order to prevent the defendant from realizing on the stock of goods pledged as security. f (d) On 5 August, 1999 the plaintiffs were the persons who locked the doors to the shops but as usual in presence (sic). (e) The defendant while completely oblivious of the fact g that the plaintiffs had approached the court wrote to the plaintiffs in good faith, two letters dated 9 August, 1999, and 11 August, 1999 requesting for reasons for their not showing up for business at the shops as was being done earlier. h The first appellant testified as PW1 and gave evidence as follows:– “. . . On 3 August, 1999, as I was trying to talk to the defendant as to the excessive charge of interest rate the defendant manager and i his officer and security came to my premises at No. 28, Ondo Road, Akure alleging that I was not performing. In view of that he ordered his men to seal my premises and the place was put under lock and key by the defendant. The second day I went to the defendant mutice (sic) to rub mind with him on the issue . . .” (See j page 26 lines 19 – 29 of the record.)

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PW3 testified and corroborated the evidence of PW1 as a follows:– “I can remember 27/8/99 a petition was written by the defendant and sent to the Commissioner of Police. I was assigned to b investigate. The petition is about Adamco and Universal Trust Bank. I invited the plaintiffs as well as the defendant to the scene of crime. On arrival the scene of crime I met one police man and a security man attached to the Universal Trust Bank. All of them were on duty and the place was sealed up by the defendant.” c (See page 40 lines 25-28 and page 41 lines 7-12 of the record.). This witness stated further under cross-examination as follows:– “I said I was at the scene of crime and said it was UTB that sealed d the premises . . .” (See page 42 lines 12 – 13 of the record.) DW1 testified as to the closure of the plaintiffs’ business e premises as follows:– “It is not true that we sealed plaintiffs’ premises. What happened is that it was the plaintiffs who locked the shop at close of business on 5 August and since then he ascribed (sic). On 6 August, 1999 f the plaintiff did not return to shop after the loded (sic) it on 5/8/99. The following week connected (sic) the plaintiff why the shop was not opened on business. We wrote 2 (two) letters in respect of the closure. These are the letters.” The letters dated 9/8/99 and 11/8/99 were admitted in g evidence as exhibits “C2A” and “C2B”. That the letters were to notify the plaintiff’s dual and joint control they have over the premises and his total indebtedness. That it was when it was discovered that the premises was locked and h unsecured that they deployed their own security men and the police to safeguard the place. It is settled law that parties are bound by their pleadings. Evidence not pleaded cannot be allowed at the trial and if i such evidence was admitted then an appellate court is duty bound to strike out such evidence, and must not consider it in the determination of the appeal. In the instant appeal, PW1 testified as to the sealing of the business premises by j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 67 a the defendant as pleaded by them in their statement of claim. PW3 who was an investigation police officer in respect of a petition written to the Commission of Police by the appellant b only confirmed what PW1 said regarding the sealing of their business premises by the appellant. The fact that PW3 had no connection with the parties before 27/8/99 not withstanding so far as the issue he was being assigned to c investigate is the business premises of the respondents, a fact which he so found in the course of his investigation. There was no evidence adduced by the appellant controverting or contradicting these pieces of evidence by the PW1 and PW3 and the lower court was right to have d acted on them. The court could have also acted on the evidence of PWI alone. In any case, there is no rule of law or of practice that says a particular number of witnesses shall be required for the proof of any fact. It is settled that e evidence which is unchallenged through cross-examination not controverted by other evidence and is not by itself incredible is qualified to be accepted and acted upon by the trial court. See Ivienagbor v Bazuaye (1999) 70 LRCN f 225; (1999) 9 NWLR (Part 620) 552; UBN v Fajebe Foods Ltd (1998) 6 NWLR (Part 554) 380. In the circumstances, it is my humble view that the evidence of PW3 lends weight to the respondent’s pleadings that their business g premises was sealed up by the appellant on 3/8/99. The finding is not perverse. This issue is also resolved against the appellant. Issue five (5) is whether on the pleadings and evidence h before the court, the learned trial Judge was right when he awarded to the respondents the sum of N1,580,000 (one million, five hundred and eighty thousand Naira) as special damages. i It is submitted for the appellant that in a claim for special damages full particulars of the claim must be given in the statement of claim citing Benin Rubber Producers Ltd v Ojo (1997) 9 NWLR (Part 521) 388 at 411; RCC (Nig) Ltd v j Edomwonyi (2003) 4 NWLR (Part 811) 513.

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It is submitted that the respondents failed to give a particulars of the loss of earning in their statement of claim which is incurably defective and should have been struck- out by the lower court citing Adedeji & Sons Motors Ltd v b Immeh (1996) 8 NWLR (Part 465) 240. It is the view of learned Counsel that details of repayments made by the second respondent which were set out in paragraph 26 of the statement of claim do not constitute particulars of special c damages in relation to loss of earnings by the second respondent. It is submitted that it is trite law that special damages must not only be pleaded with sufficient particulars, but be strictly proved with credible evidence. The following cases were referred to Osuji v Isiocha (1989) d 3 NWLR (Part 111) 623 at 636; Odulaja v Haddad (1973) 11 SC 357. It is submitted that the respondents did not lead any credible evidence to substantiate the claim for N20,000 as loss of earning per day. It is the view of learned Counsel e that PW1 in his evidence-in-chief merely repeated the claim but failed to substantiate the same with any credible evidence when he said:– “I am asking the court to grant damages of N20,000.00 naira per f day for loss of earning.” It is submitted that the above statement falls short of the strict proof of special damages as stated in Odulaja v Haddad (supra). It is further contended that it is the law that g a claim for special damages must stand or fall on the evidence of the claimant citing the following cases:– Agbaje v James (1967) NMLR 49 at 51-52; Okoronkwo v Chukwueke (1992) 1 NWLR (Part 216) 175 at 195; Haway v h Mediowa (Nig) Ltd (2000) 13 NWLR (Part 683) 77 at 91; Okeke v Aondoakaa (2000) 9 NWLR (Part 673) 501 at 528- 529; Ham Idu v Sahar Ventures Ltd (2004) 7 NWLR (Part 873) 618; Ojo v Victino Fixed Odds Ltd (2000) 9 NWLR (Part 673) 647 at 661. It is therefore submitted that the i award of N20,000 as loss of earning per day to the respondents in the absence of credible, reliable and categorical evidence is arbitrary, capricious and unjustifiable and we were urged to allow the appeal on this ground. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 69 a For the respondents it is submitted that they are entitled to the special damages awarded them. He agreed that special damages must be proved strictly citing F O Akintunde v b Chief E A Ojiekere (1971) NMLR 91 and submitted that in justifying their claims the respondents pleaded in paragraphs 26 and 27 which the appellant admitted in paragraph 12 of the statement of defence and the counter-claim. He c submitted that what is admitted needs no further proof. He referred to the following cases:– Steven Omo Ebueku v Sunmonu Amola (1988) 3 SCNJ (Part 11) 207; (1988) 2 NWLR (Part 75) 128; Karimu Olujinle v Bello Adeagbo d (1984) 4 SCNJ 1; (1984) 2 NWLR (Part 75) 238. We were asked to resolve the issue against the appellant. The respondents claimed the sum of N20,000 (twenty thousand Naira) being loss of earnings per day for the illegal e sealing of the appellants business premises at Akure from 3 August, 1999 until when the said premises is unlocked by the appellant or until when judgment is delivered. The said premises remained sealed for 79 days before the f court directed that the premises should be re-opened on 22/10/99. It is settled principle of law that special damages must not only be pleaded with sufficient particulars but it must be g strictly proved with credible evidence. If the damages claimed are special in nature, credible evidence will have to be called in order that the amount pleaded may be proved. Without such proof no special damages can be granted. See h RCC (Nig) Ltd v Edomwonyi (supra) and Osuji v Osicha (supra). The type of proof required is one that would readily lend itself to qualification or assessment. In the instant case, the respondents pleaded in paragraphs i 26 and 27 of their statement of claim as follows:– “26. The plaintiffs aver that in spite of the incidents referred to in paragraphs (12 & 13) above coupled with the said outrageous interestrate, the plaintiffs were still making reasonable and j regular repayments of their indebtedness to the defendant.

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For instance, the payments for the month of July, 1999 a speaks for itself–– Teller Date Amount Number b 1. 2/7/99 30,000.00 36,2234 2. 2/7/99 20,000.00 (36,2235) Printing 3. 5/7/99 40,000.00 (36,2235) c Error 4. 7/7/990 20,000.00 36,2236 5. 8/7/99 60,000.00 36,2237 6. 13/7/99 20,000.00 36,2238 d 7. 13/7/99 15,000.00 36,2239 8. 14/7/99 20,000.00 36,2240 9. 16/7/99 10,000.00 36,2241 10. 16/7/99 10,000.00 36,2242 e 11. 19/7/99 5,000.00 36,2243 12. 23/7/99 30,000.00 36,2245 13. 29/7/99 Cheque paid in and cleared N150,000.00 (One Hundred and Fifty Thousand Naira). The said tellers and Cheque f are hereby pleaded. 27. In addition to paragraph (25) above, some of the plaintiffs members of staff who confessed as having perpetrated the fraud discovered in the plaintiffs company have in the said g month of July, 1999 made a repayment of N45,000.00 to the defendant vide the plaintiffs account.” In their response to the above paragraphs, the appellant averred in paragraph 12 of his statement of defence as h follows–– “12. With reference to paragraphs 26 and 27 of the statement of claim, the defendant avers that these payments were only made after the bank had called in the facilities as being due for payment vide its letters dated 22 June, 1998, 5 August, i 1998, 10 September, 1998, 9 February, 1999, 22 February, 1999, but were not enough to liquidate the indebtedness.” Paragraph 26 of the statement of claim set out payments made in July, 1999 by the respondents to the appellant j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 71 a which payments range from N5,000 to N150,000. The respondents admitted such payments by their paragraph 12 of the statement of defence and the said payments were b made after the appellant called in the facilities as being due for payment. It is trite law that parties are bound by their pleadings. An averment in a pleading which is admitted need no further c proof. See National Bank of Nigeria v Opeola (1994) 1 NWLR (Part 319) 126. In the instant case, since the appellants having admitted by their pleadings that the respondents were making payments ranging from N5,000 d and N150,000 per month and there was evidence that the respondents’ business premises was illegally sealed by the appellant, and put under lock and key for a period of 79 days as found by the lower court and the further evidence from PW1 that despite the sealing of the premises, the e respondents still pay its staff. It is my view based on the average of the respondent’s returns to appellant in July, 1999 as pleaded in their statement of claim, the respondents are entitled to the award N20,000 per day. f I did not agree with the submission of the learned appellant’s Counsel that the learned trial Judge placed reliance on the evidence PW3 as the bases for his finding that the business premises of the respondents was sealed by g the appellant on 3/8/99 and awarded special damages of N20,000 per day to the respondent. There was ample evidence before the lower court from the first respondent (PW1) that the business premise was sealed by the appellant h on 3/8/99. It is my humble view that the award of N20,000 special damages to the respondents is proper and justified in the circumstances. It is based on available evidence before the lower court. The finding is not perverse and I so find. i This issue is also resolved against the appellant. Issue six (6) is whether the sum of N5,000,000 (five million Naira) awarded by the learned trial Judge as general damages in favour of the respondents is proper and j justifiable.

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It is the view of learned Counsel for the appellant that by a the nature of the second respondent’s trading business the quantum of loss arising from the sealing of its premises is ascertainable. The loss can be qualified in terms of loss of b earning and anticipated profit for the number of days during which the premises was sealed in view of paragraphs 33 and 34 of the statement of claim which states an average of sale of N20,000 per day. It is the view of learned Counsel that by c awarding general damages to the respondent when the quantum of loss is ascertainable, the award of general damages is improper. On the principle guiding the award of general damages learned Counsel referred to the case of Calabar East Co-op v Ikot (1999) 14 NWLR (Part 638) 225 d at 243. It is submitted that there must be a material evidence before the trial court showing damage to the respondents resulting from the action of the appellant. He submitted that PW1 only asked the court to grant him general damages for e the ridicules they have put him into and for losing most of his customers without any credible proof. On the point of view of proof, learned Counsel referred to the following cases, Odumosu v ACB (1976) 11 SC 55 at 68 – 69; (1988) 1 f NWLR (Part 72) 601 per Idigbe, JSC; Duyile and another v Ogunbayo & Sons Ltd (1988) 1 NSCC (Vol. 19) 385; Emegokwue v Okadigbo (1973) 4 SC 113; Mohammed v Klargester (Nig) Ltd (2002) 14 NWLR (Part 787) 335. It is g submitted that loss of customers constitute special damage and cannot be the premise for an award of general damages. It is also submitted that the business premises which was said to have been sealed by the appellant belongs to the h second respondent, a limited liability company and thus has no personal feeling and is not therefore susceptible to ridicule. It is further submitted that the first respondent being the Managing Director of the second respondent is not entitled to an award of general damages for any damage to i the second respondent whose business premises was said to have been sealed by the appellant, since a company is a separate and district personality from its directors, citing Salomon v Salomon [1897] AC 22. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 73 a It is also submitted that if the losses suffered by the respondents have been compensated for by an award of special damages the award of general damages to b respondents amounts to double compensation against which the law frowns at citing the following cases:– Ezeani v Ejid Ike (1964) All NLR 402; Oshinjinrin v Elias (1970) All NLR 153; Ekpe v Fagbemi (1978) All NLR 107; (1978) c 3 SC 209. It is further submitted that the award of N5 million Naira as general damages to the respondent for the illegal sealing of the business premises of the second respondent in addition to the sum of N1,580,000 awarded as d special damages for loss of earning amount to double compensation particularly when the general damages was hinged on loss of customers which is an item of special damage. The Court was urged to resolve this issue in favour of the appellant. e For the respondents it is submitted that the award of N5 million Naira general damages for the illegal sealing of their business was proper. He cited and relied on the case of f Union Bank of Nigeria Ltd v Odusote Book Stores Ltd (1996) 42 LRCN 1639; (1996) 9 NWLR (Part 421) 558 and submitted that the quantum of general damages need not be pleaded or proved as, is generally presumed bylaw. He also relied on the following cases, Rockonoh Property Co Ltd v g Nig Telecommunications Plc (2001) 89 LRCN 2602; (2001) 14 NWLR (Part 733) 468; Prelin v Royal Bank of Liverpool (1870) LRSFS 92; (1870) LR. 5 Exch. It is the view of learned Counsel that having regard to the circumstances of h this case, the respondents’ quantum of loss is not ascertainable as submitted by the appellant, that it is indeed at large. It is further submitted that the first respondent is the Chairman and Managing Director of the second respondent i and the sole signatory to the second respondent. That he also personally guaranteed the overdraft facilities granted to the second respondent company. That the first respondent also mortgaged his personal property as security for the j overdraft facilities granted the second respondent. That the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 74 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) first respondent is three all role (sic) into one, the guarantor, a Chairman and Managing Director of the second respondent and the owner of the property mortgaged. On the attitude of the Appellate Court to the award of b general damages learned Counsel referred to the case of Joseph Odogu v A-G of the Federation and others (1996) 40/4 LRCN 1454 at 1467; (1996) 6 NWLR (Part 456) 508. c It is also the view of learned Counsel that the court should not disturb the award of general damages having regard to the fact that the act of the appellant in sealing of the business premises amounted to self help. He referred to the case of Chief D M Okochi and others v Chief Amukali Animikwoi d and others (2004) 114 LRCN 2924 at 2942. Learned Counsel also urged the court to consider the petition exhibit “D10” written against the first respondent by the appellant to the Commissioner of Police investigated by PW3 which e suggest that the allegation against the first respondent is a criminal allegation. It is submitted that the first respondent was in the process exposed to public ridicule, odium and his reputation was put into question. That it is not out of place f for the first respondent to ask for general damages for ridicule they have made him unto. On the issue of double compensation, it is submitted that g the issue was never made a ground of appeal and not one of the issues for determination and should therefore be discountenanced citing:– Okonkwo v Ogbogu (1996) 37 LRCN 580 at 582; (1996) 5 NWLR (Part 449) 420; Olowu v Olowu (1985) 3 NWLR (Part 13) 372 at 375. It is therefore h contended that the award of special and general damages do not amount to double compensation. He relied on the following cases:– Eliochin (Nig) Ltd and others v Victoria Ngozi Mbadiwe (1986) 1 NWLR (Part 14) 47; Odiba v i Azege (1998) 61 LRCN 4605 at 4626; (1998) 9 NWLR (Part 566) 370; Ezeani v Ejidike (1964) 1 All NLR 402 and urged the Court to hold that there is no question of double compensation and against the appellant. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 75 a It is settled law that general damages are always made as a claim at large. The quantum need not be pleaded and proved. The award is quantified by what in the opinion of a b reasonable person is considered adequate loss, or inconvenience which flows naturally, as generally presumed by law, from the act of the defendant. It does not depend upon calculation made and figure arrived at from specific c items. See Rockonoh Property Co v N1TEL (2001) 89 LRCN 2602 at 2611; (2001) 14 NWLR (Part 733) 468; Odulaja v Haddad (supra); Osuji v Isiocha (supra). The learned trial Judge in awarding general damages to d the respondents had this to say:– “In the instant case, the plaintiffs are asking for N5 million Naira general damages–– ‘for the ridicules they have put me into and losing most of e my customers’.” The type of damage reproduced above which the plaintiffs are claiming is concerned with non-pecuniary losses which I must admit is difficult for me to assess without having to rely on the f opinion or the judgment of a reasonable man. The defendants never by way of cross-examination challenged the evidence of the 1st plaintiff (PW1). This claim was pleaded in the plaintiff’s statement of claim as set out in paragraph 40 thereof. g . . . In the instant case applying the definition of the of the term ‘general damages’ as defined by Martin, B. in Prelin v Royal Bank of Liverpool (Supra) to the claim of the plaintiffs, this court has no option other than to accept the amount claimed by the plaintiffs for h general damages being an assessment based on the opinion and judgment of a reasonable man. In the circumstances the plaintiffs are entitled to the amount claimed as general damages and I so hold.” i Now before delving into the issue whether the award of N5 million Naira general damages to the respondents amounts to a double compensation which the law frowns at in view of the award of N1,580,000 special damages to the j respondents, I will now proceed to consider whether the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 76 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) award of the general damages in the circumstance of this a case is justifiable. From the judgment of the lower court quoted above, it is clear that the learned trial Judge based its findings in respect b of his award of general damages on the ground that the claim is concerned with non-pecuniary losses which are difficult to assess but to rely on the opinion or judgment of a reasonable man having regard to the circumstances of the c case. The claim was awarded for ridicule which the appellant have put the respondents through and for losing most of its customers. However, it is argued by the appellant that the award of d general damages is improper where the quantum of loss is ascertainable citing UBN Ltd v Odusote Bookstores Ltd (supra); Kerewi v Odegbesa (supra). That since the respondents claimed to be making an average sale of e N20,000 per day shows that the quantum of loss is ascertainable and the award of general damages is improper. That the absence of credible evidence of damage makes the award of general damages improper. f From the point of view of proof, general damages are classified into two categories:– (1) that in which they (damages) may be inferred eg in case of defamation or personal injury to plaintiff g when pain and suffering may be presumed; (2) that in which they will not be inferred but must be proved (for instance damages arising by way of general loss of business following injury). See h Odumosu v ACB (supra). It is my humble view that the quantum of loss that is ascertainable in the instant case is the N20,000 per day loss of earning which is in the region of special damages which i has been ascertained and established by the respondents. In the circumstances, I agree with the submission of learned counsel for the respondents that having regard to the circumstances of this case, the respondent’s quantum of loss j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 77 a is not ascertainable and that it is indeed at large. I also agree with him that the quantum of loss relating to the ridicule, humiliation and negative impression the respondents were b exposed to when they were ordered out of their business premises by the appellant’s security agents and their business premises put under lock and key were not ascertainable. Coupled with the fact that policemen had to come into the business premises in full glare of the general c public to carry out investigation bordering on exhibit D10, the petition written by the appellant against the first respondent (sic). Based on the foregoing, it is my humble view that the respondents’ quantum of loss is not d ascertainable and I so find. It is also argued by the appellant that the second respondent whose business premises was alleged to have been sealed is a legal person that has no personal feeling and e is not therefore susceptible to ridicule. It is also contended that a Director cannot be made personally liable for the acts and default of his company and in the same vein a Director like the first respondent cannot be entitled to damages for f any injury suffered by his company. It is argued for the respondents that the first respondent is the Chairman and Managing Director of the second respondent’s company. He is the sole signatory to the g second respondent’s account. That apart from that he personally guaranteed the overdraft facilities granted the second respondent and mortgaged his personal property as security for the overdraft facilities granted. That first h respondent is three all rolled into one. In fact these are facts that are borne out by evidence before the lower court and there is no rebuttal evidence from the appellant. Blacks Law Dictionary (6ed) at page 391 defines general damages as:– i “Such as the law itself implies or presumes to have accrued from the wrong complained of, for the reason that they are its immediate, direct and proximate result, or such as necessarily result from the injury, or such as did in fact result from the wrong, directly and approximately, and without reference to the special j character, condition, or circumstances of the plaintiff.”

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In view of the above and the entire circumstances of this a case, it is my humble view that this instant case is clearly distinguishable with the circumstance in the case of Salomon v Salomon (supra). I am not unmindful however, of the b position of the law that while a Director of a company cannot be made personally liable for the acts and default of his company and in the same vein, a Director cannot be entitled to damages for any injury suffered by his company. c The instant appeal present a unique position and it is my view that pain and suffering in form of ridicule may be inferred to the first respondent and is entitled to some measure of general damages which may be assessed in the opinion or judgment of a reasonable man as it is concerned d with non-pecuniary losses which are difficult to estimate. Let me pause to ask the question whether in the circumstances of this case, the award of general damages to e the respondents coupled with award of special damages amounts to double compensation? It is settled law that when a man has been fully compensated under one head of damages for a particular f injury, it is improper to award him damages in respect of the same injury under another head. In other words, a plaintiff who has been awarded special damages should not be awarded an additional amount as general damages, as that would amount to double compensation, which, the court g should always refrain from granting. See Ibile Holdings Ltd v PDSS (2002) 16 NWLR (Part 792) 117; Total Nigeria v Morkah (2002) 9 NWLR (Part 773) 492; UBN Ltd v Odusote Bookstores (supra); Oshinjinrin v Elias (supra); h Ezeani v Ejidike (supra); Ekpe v Fagbemi (supra). The question is, was the learned trial Judge in error when he granted the award of general damages for the illegal sealing of the business premises of the second respondent? i My answer is clearly in the negative. The cases referred to above deal with cases of personal injury which is not the case in the instant case. The Supreme Court in Eliochin (Nig) Ltd v Mbadiwe (supra) held that if special damages are j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 79 a claimed in addition to general damages, in an action for trespass, special damages will be awarded if strictly proved in addition to general damages. Also in Odiba v Azegbe b (supra), it was also held that where special damages have been strictly proved, the respondent is also entitled to aggravated damages. See also Ezeani v Ejidike (supra). It is also my view in the instant case that the award of c special damages along with that of general damages by the lower court does not amount to double compensation and I so hold. An appellate court does not ordinarily alter or interfere d with an award of damages made by the lower court except where the award is shown to be either manifestly too high or manifestly too low or where it was based on a wrong principle of law. It is my humble view in the circumstances e of this case, that the award of N5 million Naira general damages is manifestly too high and this Court should interfere to review the award. Consequently the award of N5 million Naira general damages to the respondents is hereby f reviewed to the sum of N2 million Naira general damages. This I consider in the opinion of a reasonable man adequate loss or inconvenience which flows naturally from the acts of the appellant. This is also without prejudice to the award of g special damages. This issue is resolved partly in favour of the appellant. Issue seven (7) is whether the learned trial Judge was right when he held that the appellant has failed to prove its h counter-claim. Learned Counsel for the appellant stated the appellant’s counter-claim, the evidence of DW2 exhibit “C1”, the affidavit verifying the statement of account filed by the i appellant and exhibits “WA1” and “WA2” for accounts No. 50045021, reflecting a debit balance of N2,762,569.37 as at July, 1999 and account No. 50045005 reflecting a debit balance of N1,544,118.63 and submitted that the appellant j did establish the indebtedness of the second respondent by

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 80 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) virtue of exhibits “WA1” and “WA2” attached to exhibit a “C1” citing Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 at 215 per Olagunju, JCA wherein he said, “proof of entry in a banker’s book is the method appropriate b for establishing by the bank of the indebtedness of a customer”. It is also submitted that PW1 under cross- examination stated that he was indebted to the appellant as at 26 June, 1999, when he wrote the appellant asking to c be allowed to be repaying N200,000 monthly as per exhibit “D3”. It is the view of learned Counsel on the authorities of Akalonu v Omokaro (2003) 8 NWLR (Part 821) 190 and Thor Ltd v FCMB Ltd (2003) 4 NWLR (Part 652) 274 that the first respondent having admitted its d indebtedness to the appellant as at 26 June, 1999 vide exhibit “D3” as confirmed in the oral testimony of PW1, failed to lead evidence to show that its obligation to the appellant has been discharged. It is further submitted that the appellant e having led cogent, credible and categorical oral and documentary evidence at the lower court in proof of its counter-claim is entitled to judgment for the sum claimed as shown in the statement of account attached to exhibit “C1”. f He referred to the case of Adimora v Ajufo (1988) 3 NWLR (Part 80) 1. It is submitted that exhibit “D7” which was prepared by PW2 is predicated on the said Central Bank Guidelines g which was not tendered in evidence at the lower court. It is also submitted that the respondent having failed to tender the Central Bank of Nigeria Guidelines which formed the basis of exhibit “D7” cannot rely on the exhibit as it has no h probative value. We were urged to resolve this issue in favour of the appellant. For the respondent it is submitted that the counter-claim has not been proved as required by law. i It is submitted that there are two statement of accounts before the court ie exhibit “D7” prepared by the respondents and exhibit “C1” prepared by the appellant. Exhibit “D7” was prepared on the basis of 21% interest while “C1” was j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 81 a prepared on the basis of between 21% and 35% interest. It is submitted that the position of the respondents that at all material times between 1996 and 1999 there was a Central b Bank Lending Policy and that the maximum interest rate is 21%, while the contention of the appellant was that lending rate was deregulated and as such the appellant was at liberty to charge as high as 35% interest rate and upon which c exhibit “C1” was based. It is further submitted that DW1 testified in line with the appellants pleading that there was no Central Bank Guidelines regulating interest rate between 1996 and 1999 d while DW2 testified contrary to the pleading of the appellant both in his evidence-in-chief and under cross-examination and maintained that there was Central Bank Guidelines that regulated interest rate at all material time between 1996 and e 1999. It is argued that this is evidence against interest warranting the dismissal of the appellant’s counter-claim. He cited and relied on the authority of Adebayo v Ighodalo (1996) 38 LRCN 747; (1996) 5 NWLR (Part 450) 507; Nsirim v Nsirim (2002) 94 LRCN 117; (1990) 11 NWLR f (Part 138) 285 and Woluchem v Gudi (supra). We were urged to resolve the issue against the appellant. The appellant, by its statement of defence and counter- g claim dated 8 September, 1999, claimed against the respondents jointly and severally as follows:– (a) The sum of N2,762,569.37 (two million, seven hundred and sixty-two thousand, five hundred and h sixty-nine Naira, thirty-seven Kobo) being outstanding debt on account No. 50045021 as at 30 July, 1999. (b) The sum of N1,544,118.63 (one million, five i hundred and forty-four thousand, one hundred and eighteen Naira, sixty-three Kobo) being outstanding debt as at 5 August, 1999. From the counter-claim stated above, the total indebtedness j of the respondents to the appellant is N4,306,688 (four

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 82 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) million, three hundred and six thousand, six hundred and a eighty-eight Naira). It is submitted by the appellant that they tendered exhibit “C2B”, letter dated 11 August, 1999 stating total indebtedness of the respondents and referred to the b evidence of DW2 regarding the total indebtedness of the respondents to the appellant. They also tendered exhibit “Cl” the affidavit verifying the statement of account filed by the appellant in respect of the two accounts being c operated by the respondents and referred to cases of Obijiaku v NDIC (supra) and submitted that proof of entry in banker’s book is the method appropriate for establishing by the Bank of the indebtedness of a customer. This is so in view of the provision of section 97(1)(h) and 2(e) of d the Evidence Act when an occasion arises for a bank to prove the antecedents of a given transaction when there is such an occasion between it and its customers. However, this is not the position in the instant case. The issue in the e instant appeal is with the regard to the percentage of interest rate calculated and charged by the appellant while making entries in respect of the two accounts being operated by the respondents to arrive at the total indebtedness of the f respondents. The percentage of the interest rate calculated by the appellant in arriving at the total indebtedness is between 21% and 35% which was vehemently denied by the respondents. g Now the question is, was the learned trial Judge in error when he held that the appellant has not proved his counter- claim? What was the basis for the finding that the appellant has not proved his counter-claim? h In arriving at such a finding the learned trial Judge considered all the exhibits tendered by the parties in the proceedings and these include exhibits “A1”, “A2”, “A3” and “D1” which documents the court finds as constituting i the agreement between the parties. The lower court considered exhibits “A4”, “A5”, “A6”, “D1”, “D2”, “D3”, “D4”, “D5”, “D8”, “D9” and “D10” tendered by the appellant in proof of his counter-claim. The learned trial j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Universal Trust Bank Nigeria Ltd v Ajagbule 83 a Judge considered all the exhibits and came to the conclusion as follows:– “. . . Exhibit D6 is an extract from the minutes of the meeting of b the Board of Directors of the 2nd plaintiff as far back as 2 October, 1997, when exhibit D6 is read in conjunction with exhibit D1 dated 9/9/97, it is quite obvious that exhibit D6 was issued pursuant to exhibit D1.” c In paragraph 2 of exhibit “D6” the board resolved as follows:– “It is hereby resolved that the credit facilities offered by Messrs Universal Trust Bank Nigeria Ltd upon the terms and conditions as contained in the Bank’s letter of offer dated 9 September, 1997 d and as may be renewed from time to time be hereby accepted upon the said terms and conditions.” Exhibit “D6” is subject to the terms and conditions contained in exhibit “D1”. One of the terms and conditions e set out in exhibit “D1” is rate of interest fixed at 21%. The phrase “as may be renewed from time to time” do not relate to interest rate. It relate to facilities. Hence exhibit “D6” cannot be interpreted to mean that the plaintiffs accepted to f the variation of interest as may be varied from time to time as defendant have tried to convince this Court. To hold to this view is erroneous. The sum total of all that I have been saying is that the g defendant has failed to prove their counter-claim. On the other hand, the plaintiffs have by the preponderance of evidence proved their case. It is not in dispute that the entries in the statement of h accounts nos. 50045021 and 50045005 were made based on the interest rate at 21% and 35% respectively. It is based upon this calculation that brought the total indebtedness of the respondents from the two accounts to N4,544,118.63k i which the appellant’s counter-claimed. The issue of interest rate chargeable based on exhibits “A2”, “A3” and “D1” and as upheld by this court is 21% and not 35% based on the appellant’s calculation. It is also on record before the lower j court that the respondent produced exhibit “D7”, the audited

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 84 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) statement of accounts of the second respondent which was a tendered and admitted before the lower court without any objection. In the said audited statement of account of the respondents interest rate therein was calculated at the rate of b 21% not 35%. The said audited statement of account by the calculation of interest rate at 21%, showed that the respondents have discharged all their obligations to the appellant in respect of the overdraft facilities granted to it c from the two accounts the respondents operate with the appellant, to the extent that they have a credit balance in the said accounts to the tune of N600,000 (six hundred thousand Naira) which the appellant now owe the respondents. Having found in the instant case that the interest rate d chargeable from the respondents’ two accounts operated with the appellant and the subject matter of this appeal is 21% and not 35%, it follows therefore that the appellant has nothing to counter-claim against the respondents. By the e content of exhibit “D7”, the respondents have discharged the burden placed on them to show that the loan has been repaid. See Akalonu v Omokaro (supra) and Thor Ltd v FCMB Ltd (supra). Since the respondent’s indebtedness to f the appellant was arrived at based on 35% interest which this Court found to be oppressive, excessive, arbitrary and unconstitutional and therefore null and void; this issue is also resolved against the appellant. g In conclusion, it is my view, based on the foregoing that this appeal fails subject to the award of general damages which has been reviewed from N5 million Naira to N2 million as canvassed under issue six (6) and it is hereby h dismissed. The judgment of the lower court is hereby affirmed. The respondents are entitled to costs which is fixed at N5,000 only. i

MUHAMMAD JCA: I have read in draft the judgment just delivered by my learned brother, Abba-Aji, JCA. She had admirably set out the facts of the appeal and has j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Muhammad JCA Universal Trust Bank Nigeria Ltd v Ajagbule 85 a exhaustively dealt with all the issues raised in the appeal. I am in complete agreement with her reasoning and conclusion. The appeal is partially allowed by reducing the b award of the general damages from N5 million to N2 million. I abide by all the consequential orders made in the leading judgment including the order as to costs.

AMAIZU JCA: I have had the advantage of reading in c advance the judgment just delivered by my learned brother, Abba-Aji, JCA. I agree with her reasoning and conclusion. I have nothing useful to add. d I abide by the consequential order made in the said judgment including the order on costs. Appeal allowed in part.

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a Onuselogu Enterprises Ltd v Afribank (Nigeria) Plc

COURT OF APPEAL, ENUGU DIVISION b GALADIMA, ADEKEYE, MIKA’ILU JJCA

Date of Judgment: 4 JULY, 2005 Suit No.: CA/E/32/2001

Banking – Interest – Rate of – What determines – Section 15 c Banking Act Cap 28 Laws of the Federation of Nigeria, 1990

Facts d The appellant was an engineering contractor and customer of the respondent who had a fixed deposit of N18 million which was given to the respondent as collateral to secure an overdraft of N5 million which was later e increased. When disagreement arose about the state of the appellant’s account, both parties willingly submitted the dispute to arbitration by a legal practitioner. The arbitrator f gave the appellant an award of N7,893,408.34 together with interest of 21% thereon from 1/9/94 till the date of judgment and 5% interest from then until the judgment sum was liquidated. g The lower court awarded the sum of N7,893,804.34 with interest of 21% per annum to the respondent being what the appellant admitted of its indebtedness. h Being dissatisfied with this judgment, the appellant appealed to the Court of Appeal.

Held – i Interest is chargeable as provided by section 15 of the Banking Act Cap 28 Laws of the Federation of Nigeria, 1990 on advances, loans or credit facilities. Dismissing the appeal. j

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Onuselogu Enterprises Ltd v Afribank (Nigeria) Plc 87 a Nigerian statutes referred to in the judgment Arbitration and Conciliation Act Cap 19 Laws of the Federation of Nigeria, 1990, sections 1, 2, 3, 4, 5, First b Schedule, articles 3, 18(1), 18(2), 19(1), 19(2), 31 and 32 Banking Act Cap 28 Laws of the Federation of Nigeria, 1990, section 15 c Book referred to in the judgment Ronald Bernstein The Hand of Arbitration Practice published by Sweet and Maxwell, page 18 d Counsel For the appellant: Uko (Mrs) (with her Unigwe (Mrs) and Okon (Mrs) e For the respondent: Akaraiwe

Judgment GALADIMA JCA: (Delivering the lead judgment) This is an f appeal against the judgment of Agbo J of the Enugu High Court delivered on 16/11/2000 in an arbitration award in favour of plaintiff (hereinafter referred to as “the respondent”) in a claim brought against the defendant g (herein after referred to as “the appellant”). The case of the appellant is that he is an engineering contractor and customer of the respondent who had a fixed deposit of N18 million which was given to the respondent as h a collateral to secure an over draft of N5 million which was later increased. When disagreement arose about the state of the appellant’s account, both parties willingly submitted the i dispute to arbitration by a legal practitioner. The arbitrator gave the appellant an award of N7,893,408.34 together with interest of 21% thereon from 1/9/94 till the date of judgment and 5% interest from then until the judgment sum is j liquidated.

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Being dissatisfied with this judgment, the appellant a appealed to this Court on six grounds, three with the notice of appeal and three added by leave of this Court. In the appellant’s brief dated and filed on 19/11/2003, the b three issues for determination as framed therein are as follows:– “(1) Was the court below not in error in determining the suit of the plaintiff after it found that the parties submitted their c dispute to an arbitrator who made an award. (2) And as a corollary, was the court below not in error in not striking out the suit for being premature. (3) In the alternative, if the suit was maintainable, was the court d below not in error in awarding the sum of N7,893,804.34 with interest of 21% per annum to the respondent on the evidence before it, and the finding of the court there on.” Respondent submitted four issues for determination thus:– e “1. Whether there was indeed arbitration previous to the suit between the parties within the meaning of the Arbitration and Conciliation Act, 1988, Chapter 19 Laws of the Federation of Nigeria, 1990 which is to ask more specifically– f (a) Whether exhibit ‘e’ was in fact an arbitral award; and (b) Whether the meetings between the parties of 31 August, 1994 and 1 September, 1994 constituted arbitration proceedings within the meaning of Arbitration and Conciliation Act Cap. 19 Laws of the Federation of g Nigeria, 1990. (2) Whether the learned trial Judge indeed found that there was arbitration between the parties within the meaning of the Arbitration and Conciliation Act Cap. 19 Laws of the h Federation of Nigeria, 1990; (3) Whether the suit was indeed premature as a result of the clause giving defendant/appellant up to 31 December, 1994 to pay up 30% of the difference in the parties respective book i values of outstanding indebtedness. (4) Whether the respondent is not in fact entitled to the judgment sum of N7,893,408 with interest of 21% per annum to the respondent in the light of appellant’s admission vide exhibit ‘E’ that it owed the respondent the said sum.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA Onuselogu Enterprises Ltd v Afribank (Nigeria) Plc 89 a I have carefully considered the issues raised by the respective parties in their brief of argument. The three issues formulated by the appellant are apt and these arise for b determination of this appeal. However, the first and second issues, which deal with arbitration and the jurisdiction of the lower court to determine the dispute thereunder, can be considered together. These issues arise from grounds 1, 4, 5 c and 6 of the grounds of appeal. It is the submission of the learned Senior Advocate that the court below had no jurisdiction to entertain the action brought before it because under the Terms of the Settlement the action was premature. d Learned Counsel for the respondent submitted that there was neither arbitration agreement, arbitration proceedings nor arbitral award made. That exhibit “E” was an agreement reached between the parties in the presence of a legal practitioner who signed as witness and not as arbitrator. e The relevant law in this country dealing with arbitration is the Arbitration and Conciliation Act of 1988, Cap 19 Laws of the Federation of Nigeria, 1990 (which I will hereinafter f refer to simply as the “Act”). A fairly good understanding of the term “arbitration agreement”, its proceedings and rules are essential, as far as this appeal is concerned. Arbitration agreement is where two g or more persons agree that a dispute or potential dispute between them shall be resolved and decided in a legally binding way by one or more impartial persons in a judicial manner, upon evidence put before him or them. The h agreement is called an arbitration agreement or a submission to an arbitral proceeding when after a dispute has arisen, it is put before such person or persons for decision. The procedure is called arbitration and the decision when made is called an award. It was Ronald Bernstein in his book titled i The Hand of Arbitration Practice, published by Sweet and Maxwell in conjunction with the British Chartered Institute of Arbitrators, who says at page 18 thus:– “To constitute an arbitration agreement in the sense of an j agreement to refer future disputes to arbitration, it is sufficient

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(though not desirable) to say merely ‘dispute to be settled by a arbitration’ such a provision in a written agreement governed by English Law, would be an arbitration agreement and its defects or omission would be corrected by court if necessary.” b The foregoing definitions hold weight on the basis of sections 1–5 of the Act. Therefore, arbitral proceedings should not be taken lightly by both Counsel and the parties. They are recognized means of resolving disputes. It must be c stressed, therefore, that there must be an agreement to arbitrate, which is a voluntary submission to arbitration. In my humble view, there is no arbitration agreement contained in any clause to any document between the parties or in the exchange of letters tendered as exhibits “A– G2” in the court d below between the parties. These are the bundle of documents leading to the transaction which gave rise to this case now on appeal. I am yet to see any documented arbitration agreement between the parties to submit possible e dispute to arbitration. If so, the absence of this agreement to my mind, robs exhibit “E” of the status of an arbitral award. Although under the common law, an oral agreement to f submit present or future differences to arbitration may be valid and enforceable but section 1(1) and (2) of the Act have clearly displaced this common law principle. There is neither oral nor written agreement to arbitrate between the parties. Exhibit “E” therefore fails to meet the mandatory g requirement of the Act. I am inclined to hold the view that the question of arbitration being raised now is an afterthought for the h following reasons. The question that readily comes to mind is that if there was arbitration between the parties and that there was an award valid on the face of it, why did the appellant fail to enforce it under section 31 of the Act, which provides for its enforcement by leave of the court? It is i noted that the appellant as defendant not only did they fail to raise issue of competence of lower court to try the suit on ground of a previous arbitration between parties, they as well failed to make any attempt whatsoever to enforce the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA Onuselogu Enterprises Ltd v Afribank (Nigeria) Plc 91 a arbitral award, but rather submit to six years of litigation instituted by the respondent to recover their debt. I do not think there was arbitration between the parties. b Learned trial Judge was equally right to have so held. My attention has been drawn to the meetings of 31/8/94 and 1/9/94 between the parties. These do not constitute arbitration proceedings within the meaning of the Act. It is c not unusual that such meetings are held between banker and a debtor or customer for the purpose of recovering debts. Exhibit “E” spelt out the modality for repayment of appellant’s debt in the matter. d It is note worthy too that arbitration proceedings are governed by the Arbitration Rules as provided for in the First Schedule of the Act which has a total of 41 articles giving directions and procedural guidelines for arbitral e proceedings. None of the articles was followed or shown to have been complied with in the making of exhibit “F”. In the respondent’s brief the relevant articles and section not duly complied with have been reproduced. The articles offended f have been listed as article 18(1) and (2) which provides for statement of claim; article 19(1) and (2) making provision of statement of defence, article 3 notice of arbitration and articles 31 and 32 dealing with the form and effect of the g award. It is crystal clear that the real intention of the legislature in these articles where the word “shall” was used, was to make those provisions mandatory. The second issue of the appellant, which is being h considered with the first, is a corollary. It is that whether the lower court was not in error in not striking out the suit for being premature. This question arises from ground 6 of the grounds of appeal. The learned trial Judge’s commentary on i the “prematurity” or otherwise of this suit based on exhibit “E” is misunderstood by the appellant. In his final summation learned trial Judge said thus:– “The effect of the plaintiff reneging on the terms of exhibit ‘E’ is j that it cannot enforce the payment of the 30% difference but

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defendant’s book value of the indebtedness to the plaintiff remains a intact.” (See page 105 lines 18 – 23.) 31 December, 1994 was the time stipulated by exhibit “E” for the appellant to pay up N55,910.80 or 30% difference in b the book values between the parties. The end of December that year imposed by exhibit “E” was in respect of the 30% extra only and not in respect of the entire sum owed. If 30% was paid by the appellant it would have enabled c respondent’s overdraft facility as stipulated by exhibit “E”. Learned Counsel for the appellant proposed an alternative question for determination. It is that if the suit was maintainable, whether the lower court was right in awarding d the sum of N7,893,408.34 with interest of 21% per annum to the respondent on the evidence before it and the finding of the court thereon. This question arises from grounds 2 and 3 of the grounds of appeal. It is noteworthy that the judgment e of the lower court was based on the admitted sum of N7,893,408.34 by the appellant in exhibit “E”. In paragraph 12(b) and (c) of appellant’s amended statement of defence appellant averred thus:– f “The defendant further says that exhibit ‘E’ has determined all the issues between the parties including the defendant indebtedness to the plaintiff.” In the same exhibit “E” reproduced in the judgment of the g lower court at page 101 line 26 to page 103 line 33 clearly stated that there was conflict as to the respective book values of the parties wherein the appellant claiming a book value (or admitted indebtedness) of N7,893,408.34, which became h the judgment sum, and the respondent claiming a book value (what it insisted the appellant owed it) of N9,874,777.67. At page 104 lines 5-13 the learned trial Judge put it succinctly this way:– i “The position therefore was that while the books of the plaintiff showed the defendant’s indebtedness as N9,872,777.67, that of the defendant showed its indebtedness as N7,893,408.34. That what was in dispute was the nearly N3 million difference between the books of the said parties. This sum in the defendant’s books is j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA Onuselogu Enterprises Ltd v Afribank (Nigeria) Plc 93 a made up of the N5 million overdrafts and excess of N12,893,408.34.” The learned trial Judge was thus correct in giving judgment b for the sum of N7,893,408.34 being what appellant admitted as its indebtedness. He could not have done otherwise. I find the appellant’s argument in paragraph 14 at page 4 of their brief that “it is impossible to deduce from the plaintiff’s c statement of claim how the indebtedness of N9,844,609.07 claimed in the suit was arrived at” incorrect because paragraph 13 of the statement of claim clearly states that overdraft facility of N5 million was approved for the d appellant which pleading was admitted by the appellant at paragraph 5 of amended statement of defence dated 8/4/2000. On the interest rate, respondent’s application on initial e mortgage sum of N5 million brought the sum to N9,879,777.67 an addition of N4,874,777.67 per exhibit “E”. Appellant disputed these interest application (sic) but conceded to interest applications of additional amount of f N2,893,408.34. Interests are chargeable as provided by section 15 of the Banking Act Cap 28 Laws of the Federation of Nigeria, 1990 on advances, loans or credit facilities. However, the learned trial Judge held that the respondent had not satisfied it as to interest rate applications. g He had this to say on page 107 line 25 of the record of proceeding:– “I am of the opinion that at least when the interest rates were h unregulated, the parties ought to have been ad idem. Even for the regulated period, the Central Bank circulars relied upon were not placed before the court to enable it determine compliance. I make bold to say that even when interest regime is regulated and Section 15 of the Banking Act is made to apply, the margin between i minimum and maximum rates of interest shall be subject to negotiations between the bank and its customer.” The learned trial Judge after this passage went on to enter judgment in favour of the respondent in the sum of j N7,893,408.34 being their book value as at 31/8/94 and 21%

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA 94 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) interest rate per annum being the agreed interest rate on the a overdraft transaction from 1/9/94 till the date of judgment. I agree with the respondent that the appellant got judgment on its own terms, which he still now appealed against that b judgment which was fairly decided. It is in view of the foregoing that I consider that this appeal is lacking in merit in its entirety. It is dismissed. The judgment of the lower court is hereby affirmed. I assess c costs of N10.000 in favour of the respondent.

ADEKEYE JCA: I had read before now the judgment just delivered by my learned brother Suleiman Galadima, JCA. I d agree with his reasoning and conclusion after a meticulous consideration of the issues involved in this appeal. I have no doubt too that delving into the facts in issue before the trial court the learned trial Judge fairly decided the suit between the parties by entering judgment in favour of the respondent e to the tune of N7.893.804.34 with interest at 21% per annum. I also dismiss the appeal for being unmeritorious. I affirm the judgment of the lower court, and adopt the award of N10,000 costs in favour of the respondent. f MIKA’ILU JCA: Having read in draft the lead judgment just delivered by my learned brother, Suleiman Galadima, JCA I agree with the reasoning and conclusion therein. I find that g there is no merit in this appeal and I dismiss it. I affirm the judgment of the lower court. I award the same order as to costs as awarded in the lead judgment. Appeal dismissed.

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Nigerian Advertising Services Ltd v United Bank for Africa Plc 95 a Nigerian Advertising Services Ltd and another v United Bank for Africa Plc and another b SUPREME COURT OF NIGERIA BELGORE, ONU, EJIWUNMI, EDOZIE, AKINTAN JJSC

Date of Judgment: 8 JULY, 2005 Suit No.: SC.18/2000 c Mortgage – Power of sale – Exercise of – Mortgagor offering to pay mortgage debt before sale – Mortgagee refusing and going ahead with sale – Effect d Mortgage – Power of Sale – Whether mortgagee can be restrained

Facts e The dispute culminating into this appeal emanated from a mortgage transaction under which the second appellant, in consideration of a loan and overdraft facilities granted by the f first respondent Bank to the first appellant, mortgaged to the first respondent Bank his property at No. 52, Norman Williams Street, South-West, Ikoyi, Lagos. In default of repayment, the first respondent gave to the appellants written notices of its intention to sell the mortgaged g property. On 3/4/89, the first respondent gave to the appellants a final notice of sale and in reaction, the appellants in their reply dated 17/4/89 asked for an extension of 4 weeks “to produce a better offer” having known that the h first respondent had got an offer of N1.2 million. Subsequently, the appellants on 21/4/89, intimated the first respondent’s solicitor, that they had got an offer of N1.3 million. Consistent with that, the appellants on 11/5/89 i presented to the first respondent a bank draft for N1.3 million as liquidation of the mortgage debt which at the time stood at N700,395.93. The first respondent declined to accept the said bank draft alleging that the mortgaged j property had been sold on 28/4/89.

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In consequence of the foregoing, the appellants as a plaintiffs by a writ of summons dated 18/10/89 filed in the High Court of Lagos State in Suit No. L/2182/89 commenced an action against the first respondent as b defendant claiming, inter alia, that the purported sale of the plaintiffs’ property is null and void and an order to set aside the same. Pleadings were filed and exchanged. In the statement of defence and amended counter-claim filed by c the defendant bank, it denied the plaintiffs’ claim and counter-claimed for rent and mesne profits as well as the possession of the mortgaged property. In the ensuing trial, each party called witnesses to d substantiate its case and at the end, the learned trial Judge, Adeyinka, J in a reserved judgment delivered on 16/12/92, found against the plaintiffs, dismissing their claim and entering judgment for possession of the mortgaged property in favour of the second defendant. e Dissatisfied with the judgment, the plaintiffs as appellants lodged appeal to the Court of Appeal, Lagos Division. The second respondent who presumably bought the mortgaged f property on application was joined in the suit as an interested party. The Court of Appeal by a unanimous decision delivered on 2/6/99 dismissed the plaintiffs/appellants’ appeal and affirmed the judgment of the trial court. Against that decision of the Court of Appeal, g the appellants have lodged the present appeal.

Held – 1. It is a well-established principle of law that a mortgagee h will not be restrained on the exercise of his power of sale merely because the mortgagor objects to the manner in which the sale is being arranged or because the mortgagor has commenced a redemption action in court. i But the mortgagee will be restrained if the mortgagor pays the amount claimed by the mortgagee into court. 2. The sale of the mortgaged property after the appellants had tendered the bank draft of N1.3 million could not j

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Nigerian Advertising Services Ltd v United Bank for Africa Plc 97 a have been done in good faith without collusion with the purchaser. The sale therefore was null and void. Appeal allowed. b Cases referred to in the judgment Nigerian c Akanmu v Adigun (1993) 7 NWLR (Part 304) 218 Bajoden v Iromwanimu (1995) 7 NWLR (Part 410) 655 Enang v Adu (1981) 11–12 SC 25 d Honika Sawmill Nig Ltd v Hoff (1994) 2 NWLR (Part 326) 252 Insurance Brokers of Nigeria v ATM Co Ltd (1996) 8 NWLR (Part 466) 316 e Lokoyi v Olojo (1983) 8 SC 61; (1983) 2 SCNLR 127 Nigerian Housing Development Society v Mumuni (1977) 2 SC 57 f Obmiami Brick & Stone Nig Ltd v ACB Ltd (1992) 3 NWLR (Part 229) 260 Olagunyi v Oyeniran (1996) 6 NWLR (Part 453) 127 Temco Engineering and Co Ltd v SBN Ltd (1995) 5 NWLR g (Part 397) 607

Nigerian statutes referred to in the judgment Evidence Act, section 149(d) h Counsel For the appellants: Uwechue (with him Okolo) i For the first respondent: Chukwurah (Mrs) For the second respondent: Shasore (with him Ademola)

AKINTAN JSC: (Delivering the lead judgment) The j appellants, as plaintiffs, instituted this action in the Lagos

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Judicial Division of the High Court of Lagos State as Suit a No. L/2112/89 against the present first respondent as defendant. The present second respondent was joined as an interested party when the case was on appeal at the court b below. The plaintiffs’ claim arose over a dispute between the plaintiffs and the f irst respondent bank. It was over a purported sale of the second appellant’s house at 52 Norman Williams Street, South-West, Ikoyi, Lagos which was c mortgaged to the first respondent as security for overdraft facilities granted by the bank to the first appellant but guaranteed by the second appellant. The first respondent contended that the house was sold d when it exercised its power of sale under a deed of mortgage. The appellants disagreed that there was in fact any sale or if there was one, it was made in breach of the terms of the deed of mortgage. The plaintiffs therefore filed e their action in which they claimed the following reliefs from the court:– “(a) A declaration that the purported sale of the plaintiffs’ property known and described as 52, Norman Williams f Street, South-West, Ikoyi, Lagos is null and void and of no effect whatsoever. (b) A declaration that the purported sale of the plaintiffs’ said house by the defendant is not in accordance with the g provisions of the law. (c) An order setting aside the purported sale of the said property by the defendant on the ground that the sale was fraudulent and/or made in bad faith. h (d) A declaration that an offer of N1.3 Million had been made to the plaintiffs for their property by another person and this was communicated to the defendant and its solicitors, Mr. Obembe, before their purported sale of the same property for i a lesser amount of N1.2 million. (e) A declaration that the purported sale is also null and void because it was contrary to the terms of the mortgage agreement between the plaintiffs and the defendant.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA Nigerian Advertising Services Ltd v United Bank for Africa Plc 99 a The parties filed their respective pleadings. The defendant/ first respondent filed an amended counter-claim in which it counter-claimed as follows:– b “The defendant, as trustee for the purchaser, hereby claims against the 2nd plaintiff, Chief A. Megafu– (a) Rent and mesne profits in respect of the property at No. 52, Norman Williams Street, South West, Ikoyi, Lagos. c (b) Possession of the said property.” At the trial which took place before Adeyinka, J the second plaintiff/appellant gave evidence for the plaintiffs and he d was duly cross-examined by learned Counsel for the defence. His evidence was in line with the plaintiffs’ pleadings. He told the court, inter alia, that he presented a draft for full payment of his indebtedness to the bank but e was refused by the bank on the ground that the house had been sold to an unnamed buyer for N1.2 million even though he had earlier told the bank that he had an offer of N1.3 million for the same property. He denied that there was a f sale of the property at the time he presented the draft for full settlement of his indebtedness to the bank. The case for the defence was presented by one Francis Okunfolami, the loans recovery officer of the bank. He told g the court, inter alia, that the second plaintiff’s property in question was mortgaged to his bank as security for the overdraft facilities granted to the plaintiffs. When the plaintiffs failed to pay up their indebtedness to his bank, h they decided to sell the property. The witness admitted under cross-examination that the second plaintiff had asked, in a letter he wrote to the bank, to be given four weeks to pay the debt. He said they did not reply to the letter and that i the second plaintiff brought the draft which they rejected before the expiration of the four weeks he had earlier requested in his letter. The witness also admitted that the property was sold by j private negotiation. His answer to some of the questions put

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA 100 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) to him under cross-examination as recorded on page 89 of a the record are, inter alia as follows:– “The property was sold by private negotiation. We did not publish it. The property has been sold before he brought his cheque. I b cannot remember the exact date it was sold. It was sold in 1988. I cannot remember the month.” The defendant closed its case at the end of the evidence of their only witness and learned Counsel for the respective c parties addressed the court. The learned trial Judge thereafter delivered his reserved judgment in the case on 16/12/92. The learned Judge dismissed the plaintiffs’ claims. He granted the defendant’s counter-claim and N100 costs was awarded d to the defendant. The plaintiffs’ appeal to the court below was dismissed with N3,000 as costs to the respondent. The present appeal is against the judgment of the court below. The appellants filed five grounds of appeal against the e said judgment of the court below. The parties filed their briefs in this Court. The appellants formulated the following three issues as arising for determination in their brief:– “i. Whether the Court of Appeal was right in upholding f the decision of the trial court that the mortgaged property was sold on 28 April, 1989, on the ground that the 1st appellant had admitted the sale in its pleadings and evidence, having regard to the findings of the trial Judge that the parties had joined issue on that g matter in their pleadings and that the onus was on the defendant to establish that it had sold the mortgaged property. ii Whether the Court of Appeal was right in treating the evidence of the 2nd plaintiff as to what one Mr. h Obembe (who did not testify) had told him of the date of the purported sale as evidence of fact of the sale on the said date. iii Whether the Court of Appeal was right in failing to i consider the application of Section 149(d) of the Evidence Act Cap. 112 against the 1st respondent for failing to provide any evidence to support its averments that it had sold the mortgaged property executed a deed of mortgage in favour of the purchaser and paid the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA Nigerian Advertising Services Ltd v United Bank for Africa Plc 101 a purchase money into the 1st plaintiff’s account before the cheque for the redemption of the mortgage was presented.” b As I have stated earlier above, the second respondent was joined as an interested party by an order of the Court of Appeal. Each of the two respondents filed a respondent’s brief in this court. The first respondent formulated five c issues as arising for determination in the first respondent’s brief while two issues were formulated in the second respondent’s brief. All the issues formulated in the two respondents’ briefs are, however, well covered in the three issues raised in the appellants brief. I therefore do not d consider it necessary to reproduce the issues formulated in the two briefs filed by the respondents. I believe that the three issues formulated by the appellants are quite adequate in resolving the questions raised in the appeal. e On the appellants’ issue 1, it is submitted that it was quite clear from the pleadings of the parties that the parties joined issues on whether the property was sold on 28 April, 1989 before the mortgagor tendered a bank draft for N1.3 million f to redeem the mortgage on 11 May, 1989. Reference is made to the evidence of the only witness called by the defence in the case. It is submitted that the said witness failed to tell the court the exact date the property was sold. g The learned justices of the Court of Appeal are therefore said to have acted wrongly when they held that the sale was made on 28 April, 1989 when no such evidence was tendered at the trial. They are therefore said to be wrong h when they upheld the findings of fact made by the learned trial Judge that the sale was made before the appellants presented the cheque for full payment of their indebtedness to the bank when no such evidence was tendered before the i trial court. It is submitted in reply in the two briefs filed by the two respondents that it was clear from the plaintiffs’ claim and pleadings filed in the case that the plaintiffs acknowledge j that there was sale of the mortgage property. It is therefore

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA 102 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) submitted that it was not necessary for the defence to lead a evidence in denial of the sale. It is clear from the appellants’ claim, which I have already set out above that the main grouse of the appellants was b directed at the sale of the mortgaged property. They clearly asked, in the first leg of their claim, for “a declaration that the purported sale of the plaintiffs’ property . . . is null and void and of no effect whatsoever”. They also asked in their c third claim, for “an order setting aside the purported sale of the said property by the defendant on the ground that the sale was fraudulent and/or made in bad faith”. The appellants also set out in their pleadings that they had earlier d informed the first respondent that they received an offer for N1.3 million Naira for the house and also wrote the first respondent to ask for four weeks to enable them settle their indebtedness. The first respondent bank did not reply to any e of the two information conveyed to it in the two letters from the appellants. The second appellant also contended in his evidence at the trial that there was no sale and if there was one, it was f fraudulent in that the purported sale of the house for N1.2 million was made after he informed the first respondent that he already had an offer of N1.3 million and after he asked for 4 weeks within which to fully settle the indebtness to the bank. g The only witness who testified for the respondents, on the other hand, could not tell the court the exact date or month when the sale was made. He said the sale was not published h or advertised. He merely said that the sale was made before the second appellant brought his cheque for full settlement of his indebtedness to the bank. It may also be mentioned that when the second appellant presented his cheque at the bank, he was merely told that the house had been sold. He i was not shown the statement of his bank account where and the date the purchaser of the house paid the purchase money into the bank account. It is very ridiculous for the respondents to hold that there was no need for them to lead j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA Nigerian Advertising Services Ltd v United Bank for Africa Plc 103 a evidence to rebut the allegation clearly made by the appellants that there was no sale or that if there was one, it was fraudulent. b On the other hand, the first respondent contended that it relied on the averments contained in paragraph 9 of the plaintiffs’ statement of claim to the effect that the appellants were told that the house was sold on 28/4/89. The plaintiffs c had pleaded as follows in the paragraph 9:– “The plaintiffs aver that a bank draft No. 017466 dated 11/5/89 for N1.3 million drawn on Nigerian Merchant Bank Ltd. was presented to the defendant on 11/5/89 for the liquidation of the d mortgage debt, but was rejected by the defendant on the ground of the property having been sold on 28/4/89 thereby denying the plaintiffs opportunity to redeem their property.” The plaintiffs merely pleaded in that paragraph 9 what the e second plaintiff was told when he went to present the bank draft in the bank. It is definitely wrong to hold that the plaintiffs had by that averment admitted both the sale and the date of sale of the property. An admission, as defined in f Black’s Law Dictionary (6ed) 1990, page 47, is “a statement made by one of the parties to an action which amounts to a prior acknowledgment by him that one of the material facts relevant to the issues is not as he now claims.” The position g of the law is that facts admitted require no further evidential proof. See Bajoden v Iromwanimu (1995) 7 NWLR (Part 410) 655; Obmiami Brick & Stone Nig Ltd v ACB Ltd (1992) 3 NWLR (Part 229) 260 at 301 and Olagunyi v Oyeniran (1996) 6 NWLR (Part 453) 127 at 143. In the instant case, h the plaintiffs’ case was that there was no sale as at the time they presented the cheque for full settlement of their indebtedness to the bank or if there was in fact a sale, it was fraudulent to sell the mortgaged property for N1.2 million i after the bank had been informed of a higher offer of N1.3 million for the same property. The onus was therefore on the defence to establish that there was in fact a sale and that the sale was made before the plaintiffs notified the bank of a j higher offer of N1.3 million. In other words, the defence

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA 104 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) would need to plead and lead credible evidence in support of a the date the sale was made. As has been shown above, the only witness for the defence failed to satisfy this requirement. b The law is settled that an averment in pleadings is no evidence and cannot be so construed. They are mainly to set out the evidence that a party is likely to present so that the other side would not be caught unaware or unprepared. The c averments in pleadings must be proved by evidence except, however, where they are admitted by the other party. See Akanmu v Adigun (1993) 7 NWLR (Part 304) 218 at 231; Honika Sawmill Nig Ltd v Hoff (1994) 2 NWLR (Part 326) d 252 at 260 and Insurance Brokers of Nigeria v ATM Co Ltd (1996) 8 NWLR (Part 466) 316 at 328. In the instant case, the defendant had pleaded in paragraph 14 of its statement of defence as follows:– e “In reply to paragraph 9 of the statement of claim, the defendant avers that it has sold the mortgage property, executed a deed of assignment in favour of the purchaser and paid the purchase money into the plaintiff’s account before the plaintiffs presented a bank draft for N1.3 million for the liquidation of the mortgaged f debt.” But the defence failed to lead any evidence in support of the above averments pleaded. The only witness for the defence g merely told the court that the property was sold in 1988 and that he could not remember the month. He said nothing about averments in their pleadings concerning payment of the amount realised from the sale of the property into the plaintiffs’ bank account. If that evidence was given, the h entry in the plaintiffs statement of account would have probably confirmed whether the date the payment was made into the account was before or after the plaintiffs notified the bank of the higher offer of N1.3 million the plaintiffs i received for the property which the bank now sold for a lesser sum of N1.2 million. The plaintiffs’ allegation of fraud made against the defendant would have been debunked. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA Nigerian Advertising Services Ltd v United Bank for Africa Plc 105 a As already declared above, pleadings could not replace evidence. Any pleaded fact which is not given in evidence is therefore deemed abandoned. The defence therefore failed to b controvert all the very serious allegations levelled against it on the sale of the property. The findings of fact made by the trial court on the issue are therefore totally erroneous. The court below was also in error when it affirmed the judgment c premised on those erroneous findings of fact. The law is settled that this Court will only disturb concurrent findings of the lower courts in very rare instances, such as where there is insufficient evidence to d support them or there is glaring miscarriage of justice clearly shown to have occurred. See Enang v Adu (1981) 11–12 SC 25; Lokoyi v Olojo (1983) 8 SC 61 at 68; (1983) 2 SCNLR 127 and Bajoden v Iromwanimu (1995) 7 NWLR (Part 410) 655 at 670. e In the instant case, the main dispute before the trial court was whether the sale of the property was made before the plaintiffs offered to settle the debt owed the bank and if so, f whether the sale was made before or after the plaintiffs notified the first respondent of a higher offer for the building. Although the first respondent pleaded the date the sale “was made”, it failed to lead evidence in support of its pleadings. The trial court therefore failed to hold that the g evidence led in support of the plaintiffs’ case stood uncontroverted. The result was that the plaintiffs’ claim was wrongly dismissed by the trial court and the counter-claim was wrongly granted by the same trial court. Similarly and h based on the same reasons, the court below was wrong when it affirmed the judgment of the trial court by dismissing the appellants’ appeal. There is therefore merit in the appeal on the appellants’ issue 1. i The question raised in the appellants’ issue 2 is whether the court below was right in treating the evidence of the second plaintiff as to what Mr Obembe had told him regarding the date of the purported sale as evidence of the j fact of the sale on the said date. As I have said earlier above,

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA 106 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) this was the information that prompted the plaintiffs to a commence their action. It was the same information that they were challenging in court. That information could therefore not be evidence against them at the trial. b Also in issue 3, the appellants raised the question whether the court below was right in failing to consider the application of section 149(d) of Evidence Act, against the first respondent for failing to provide any evidence to c support its averment that it had sold the mortgaged property, executed a deed of assignment in favour of the purchaser and paid the purchaser money into the first plaintiff account before the draft for the redemption of the mortgage was d presented. Section 149(d) of the Evidence Act provides that:– “149. The court may presume the existence of any fact which it thinks likely to have happened, regard being had to the e common course of natural events, human conduct and public and private business, in the irrelation to the facts of the particular case, and in particular the court may presume – (d) that evidence which could be and is not produced f would, if produced, be unfavourable to the person who withholds it.” The appellants again raised in this issue the failure of the defence to lead evidence in support of the averments in their g pleadings. As I have fully discussed above the effect of the failure, I need not repeat same again. In conclusion, I allow the appeal. I accordingly set aside h the judgment of the Court of Appeal delivered in this case on 9 June, 1999 including all the orders made therein. Also set aside the judgment of Adeyinka, J delivered in the case on 16 December, 1992 and all the orders made therein. In their place, I hereby order that the plaintiffs proved their i claim before the court and I accordingly enter judgment for them as per their claim. I hold that the defendant’s counter- claim failed and I accordingly make an order dismissing it. The appellants are entitled to their costs both at the High j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JCA Nigerian Advertising Services Ltd v United Bank for Africa Plc 107 a Court, the Court of Appeal and in this Court which I assess respectively as N3,000, N5,000 and N10,000. All the costs are to be paid by the first respondent. b BELGORE JSC: Clearly the purported sale of the property by defendant bank was not in good faith. The whole was done stealthily and in secrecy whereby even the appellant/mortgagor was not given access to his account so c that the alleged purchase would not be known. Equity of redemption is a strong point in equity and it cannot lightly be vitiated. The purported sale is null and void. I therefore agree with Akintan, JSC that the appeal has merit. I also d allow it with the same consequential orders as to costs as the judgment of Akintan, JSC.

ONU JSC: Having been privileged to read before now the e judgment of my learned brother, Akintan, JSC just delivered, I agree with him that the appeal must perforce succeed. In the circumstances, I too allow the appeal and make f similar consequential orders inclusive of cost awarded in favour of the appellants.

EJIWUNMI JSC: I, having had the advantage of reading the g draft of the judgment just delivered by my learned brother, Akintan, JSC, I also uphold this appeal for the reasons given in the said judgment and also abide with the orders made with regard to costs in favour of the appellant. h EDOZIE JSC: The dispute culminating into this appeal emanated from a mortgage transaction under which the second appellant, in consideration of a loan and overdraft facilities granted by the first respondent Bank to the first i appellant, mortgaged to the first respondent Bank his property at No. 52, Norman Williams Street, South-West Ikoyi, Lagos. In default of repayment, the first respondent gave to the appellants written notices of its intention to sell j the mortgaged property. On 3/4/89, the first respondent gave

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC 108 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) to the appellants a final notice of sale and in reaction, the a appellants in their reply dated 17/4/89 asked for an extension of 4 weeks “to produce a better offer” having known that the first respondent had got an offer of N1.2 million. b Subsequently, the appellants on 21/4/89, intimated the first respondent’s solicitor, that they had got an offer of N1.3 million. Consistent with that, the appellants on 11/5/89 presented to the first respondent a bank draft for N1.3 c million as liquidation of the mortgage debt which at the time stood at N700,395.93. The first respondent declined to accept the said bank draft alleging that the mortgaged property had been sold on 28/4/89. d In consequence of the foregoing, the appellants as plaintiffs by a writ of summons dated 18/10/89 filed in the High Court of Lagos State in Suit No. L/2182/89 commenced an action against the first respondent as defendant e claiming, inter alia, that the purported sale of the plaintiffs’ property is null and void and an order to set aside the same. Pleadings were filed and exchanged. In the statement of defence and amended counter-claim filed by the defendant bank, it denied the plaintiffs’ claim and counter-claimed for f rent and mesne profits as well as the possession of the mortgaged property. In the ensuing trial, each party called witnesses to substantiate its case and at the end, the learned trial Judge, g Adeyinka, J in a reserved judgment delivered on 16/12/92, found against the plaintiffs, dismissing their claim and entering judgment for possession of the mortgaged property in favour of the second defendant. h Dissatisfied with the judgment, the plaintiffs as appellants lodged appeal to the Court of Appeal, Lagos Division. The second respondent who presumably bought the mortgaged property on application was joined in the suit as an i interested party. The Court of Appeal by a unanimous decision delivered on 2/6/99 dismissed the plaintiffs/ appellants’ appeal and affirmed the judgment of the trial court. Against that decision of the Court of Appeal, the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Nigerian Advertising Services Ltd v United Bank for Africa Plc 109 a appellants have lodged the present appeal. Briefs of argument were filed by the appellants and each set of the two respondents with issues for determination formulated b therein. From the pleadings, evidence and issues agitated by the parties, I think that the crux of this case is whether as at 11/5/89, when the second appellant presented to the first c respondent Bank a draft of N1.3 million in liquidation of the mortgage debt, the first respondent mortgagee had exercised its power of sale to effect the sale of the mortgaged property. This point is evident from paragraphs 9 of the statement of d claim and paragraphs 14, 15 and 16 of the defendants’ statement of defence – reproduced hereunder:– Statement of Claim “9 The plaintiffs aver that a Bank draft No. 017466 dated e 11/5/89 for N1.3 drawn on Nigerian Merchant Bank Ltd, Broad Street Branch in favour of the defendant was presented to the defendant on 11/5/89 for the liquidation of the mortgage debt but was rejected by the defendant on the ground of the property having been sold on 28 April, 1989 f thereby denying the plaintiffs opportunity to redeem their property. The plaintiffs plead this document and will rely on it at the trial of this action.” Statement of Defence g “14 In reply to paragraph 9 of the statement of claim, the defendant avers that it had sold the mortgaged property executed a deed of assignment in favour of the purchaser and paid the purchase money into the 1st plaintiff’s account h before the plaintiff presented a Bank draft for N1.3million for the liquidation of the mortgage debt. 15. The defendant avers that the willingness and manifestation of the plaintiffs’ intention to redeem the mortgaged property came too late, in that the defendant as mortgagee/vendor had i sold and transferred title to the purchaser hence the defendants’ refusal to accept the said Bankdraft. 16. . . . A letter informing the plaintiffs that the property has been j sold will be relied and founded upon.”

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From the state of the pleadings, it is common ground that on a 11/5/89, the appellants presented or tendered to the first respondent bank a draft of N1.3 million more than was sufficient to liquidate the mortgage debt. The first b respondent refused to accept the draft on the ground that before the draft was tendered, the mortgaged property had been sold. That would have been a complete defence to the appellants’ action if that allegation were established. The c onus is on the party who asserts to prove its assertion. At the trial, the first respondent’s sole witness testifying in-chief stated at pages 87 and 88 thus:– “My name is Francis Okunfolami . . . I am a loan recovery officer with U.B.A . . . During the course of business, the plaintiff applied d for overdraft and loan which was granted to him. It was in 1979 to be due by 1982, but unfortunately he did not pay up. We wrote letter of demand. Court . . . e The three letters of demand dated 9/12/88, 5/6/89 and 3/4/89 are admitted in evidence as exhs. D2, D3 and D4 respectively. ‘When he failed to pay up after series of letter of demand, we decided to realise one of the securities he mortgaged for the f facility by selling his property at No. 52, Norman Williams Street, Ikoyi. The property was sold to Mrs. Okwesa. We prepared a deed of assignment in her favour. The original deed was given to her as the purchaser. This is a copy of the deed of assignment.’ g Court– The copy of the deed of assignment is tendered and no objection admitted in evidence as exh. D5. Cross-Exam. . . h I know that the plaintiff brought a cheque to our bank before the four weeks. Obembe said we got a cheque for N1.2 million. We went and sold the property, I have never seen Mrs. Okwesa. I don’t know whether she signed any document with our bank . . . The property has been sold before he brought his cheque. I cannot i remember the exact date it was sold. It was sold in 1988. I cannot remember the exact month . . .” It is evident from the above excerpts of the evidence of the sole witness of the respondent bank that it had not j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC Nigerian Advertising Services Ltd v United Bank for Africa Plc 111 a established by credible evidence that the mortgaged property was sold before 11/5/89 when the appellants tendered their bankdraft. If, as pleaded by the respondent in paragraph 14 b of the statement of defence that the purchase money was paid into the appellants’ account, the best evidence to that effect would have been the appellants’ statement of account which was in the custody of the first respondent. Again the c letter pleaded in paragraph 16 of the statement of defence in which the Bank claimed to have informed the appellants that the property had been sold was not tendered despite the averment that the Bank would rely on it. By section 149(d) of Evidence Act, the presumption is that there was no such d letter. The deed of assignment exhibit “25” was made on 12 September, 1989. It seems to me manifest that the respondent Bank was unable to discharge the burden of proving that it had sold the mortgaged property before e 11/5/89 when the draft of N1.3 million was presented to it by the appellants. The irresistible inference, therefore, is that as at that date the mortgaged property had not been sold. What then is the legal consequence? In this regard, I think f the statement of law in the case of Nigerian Housing Development Society and another v Yaya Mumuni (1977) 2 SC 57 is apposite. In that case, this Court per Sir Udo Udoma, JSC as he then was had this to say:– g “It is a well established principle of law that a mortgagee will not be restrained on the exercise of his power of sale merely because the mortgagor objects to the manner in which the sale is being arranged or because the mortgagor has commenced a redemption h action in court (see Adams v Scott (1859) 7 WR 213). But the mortgagee will be restrained if the mortgagor pays the amount claimed by the mortgagee into court (see Hickson v Darlow (1883) 23 Ch. D 690).” i See also the case of Temco Enginering & Co. Ltd v SBN Ltd (1995) 5 NWLR (Part 397) 607. I am of the view that the sale of the mortgaged property after the appellants had tendered the bank draft of N1.3 j million could not have been done in good faith without

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Edozie JSC 112 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) collusion with the purchaser. The sale therefore was null and a void. The appellants are entitled to their claim. The foregoing is in support of the leading judgment just delivered by my learned brother, Akintan, JSC. I agree with b him that the appeal is meritorious and is hereby allowed with all the consequential orders contained in the leading judgment. Appeal allowed. c

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Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd 113 a Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd and others b SUPREME COURT OF NIGERIA KUTIGI, KATSINA-ALU, EJIWUNMI, MUSDAPHER, AKINTAN JJSC Date of Judgment: 8 JULY, 2005 Suit No.: SC. 22/2001 c Garnishee – Principles applicable Garnishee – Order – When final – When interlocutory

Facts d The main issue raised in this appeal is whether a garnishee order made absolute by a court is an interlocutory or final order. e Held – 1. Applications for garnishee proceedings are made to the court by the judgment creditor and the orders of the court usually come to two steps:– The first is a garnishee f order nisi. Nisi is a Norman-French word and it means “unless”. It is therefore an order made, at that stage, that the sum covered by the application be paid into court or to the judgment creditor within a stated time unless there g is some sufficient reason why the party on whom the order is directed is given why the payment ordered should not be made. If no sufficient reason appears, the garnishee order is then made absolute and that ends the h matter in that the party against whom the order absolute is made is liable to pay the amount specified in the order to the judgment creditor. The court thereafter becomes functus officio as far as that matter is concerned in that i the Judge who decided the matter is precluded from again considering the matter even if new evidence or argument are presented to him. 2. During the period between when the order nisi and the j order absolute are made, the matter would still be

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pending before the court. In other words, the a proceedings would still be at the interlocutory stage. But once the order absolute is made, there would be nothing left before the court in the matter. The court has, at that b stage, completely determined the matter between the parties as far as the proceedings are concerned. The court would be functus officio. There would then be nothing left to be determined by the court. The question c of the proceedings, at that stage, being interlocutory would therefore not arise. Appeal allowed. d Cases referred to in the judgment Nigerian

Akinsanya v United Bank for Africa Ltd (1986) 7 SC (Part 1) e 233 Odutola v Oderinde (2004) All FWLR (Part 217) 615; (2004) 12 NWLR (Part 888) 574 Omonuwa v Oshodin (1985) 2 SC 1 f Western Steel Works Ltd. v Iron and Steel Workers Union (1986) 3 NWLR (Part 30) 617 g Foreign Blakey v Latham (1889) 43 Ch D 25 Bozson v Altrinchan Urban District Council (1903) 1 KB 547 h Choice Investments Ltd v Jeronmimon (Midland Bank Ltd, Garnishee) [1981] 1 All ER 225 Salaman v Warner (1891) 1 QBD 734 i

Book referred to in the judgment Words & Phrases Legally Defined (3ed) Volume 2, pages 301, 313 – 314 j

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Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd 115 a Counsel For the appellant: Kanu Respondent not represented. b Judgment KATSINA-ALU JSC: (Delivering the lead judgment) At the High Court of Abia State in the Osisioma Judicial Division, c Boney Marcus Industries Ltd as plaintiff commenced an action against Nichimen Co. Nigeria Ltd as defendant in suit no. HOS/229/96. Judgment was given in favour of the plaintiff on 19 May, 1997. d In due course, the plaintiff filed garnishee proceedings praying that it be paid the judgment debt in the hands of Metcome Nigeria Ltd and Union Bank Nigeria Plc as garnishees. e On 17 February, 1998 the High Court gave a ruling. In it the High Court ordered as follows:– “IT IS HEREBY ORDERED, pursuant to Section 85 of the f Sheriffs and Civil Process Law Cap. 118 Laws of the Eastern Nigeria, 1963 applicable in Abia State, that the money belonging to the judgment debtor in possession of the 1st garnishee which money is in the 1st garnishee’s account with the 2nd garnishee be attached to satisfy the judgment debt, together with the costs of the g garnishee proceedings.” Although dissatisfied with the ruling, the second garnishee/ appellant promptly complied with the order embodied therein by sending to the Registrar of the trial high court on h 25 February, 1998 a cheque for an amount representing the balance in the first garnishee’s account with it. Thereafter on 27 March, 1998, the second garnishee, Union Bank Nigeria Ltd filed a notice of appeal against the said ruling. It is as to i the competence of that notice that the plaintiff/judgment creditor has raised the objection that has given rise to the present proceedings. At this stage, I wish to point out, although obvious, that j the second garnishee/appellant (Union Bank of Nigeria Plc)

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC 116 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) was not a party to the proceedings in suit no. HOS/229/96 a which resulted in the judgment sought to be executed by the garnishee proceedings. It is not the decision in that suit against which the appeal under challenge has been filed. The b decision in question as I have shown above is the decision of 17 February, 1998 making the garnishee order absolute against the second garnishee/appellant. It should be understood that it is to the garnishee proceedings that the c second garnishee/appellant was a party and in which it had rights and obligations. As I have already indicated, the judgment creditor, Boney Marcus Industries Ltd in its reaction to the appeal filed d against the garnishee order absolute, filed a notice of preliminary objection under Order 3 rule 15(1) of the Court of Appeal Rules challenging the competence of the appeal for the following reasons:– e (i) The ruling made by the court below on 17 February, 1998, was interlocutory. (ii) An appeal against that ruling ought to have been filed within 14 days. f (iii) The notice of appeal in this case was filed on 27 March, 1998 and is therefore filed out of time and without leave of court. g (iv) The ruling of the court below made on 25 May, 1998 to the effect that the notice of appeal is void and incompetent stands and has not been appealed against. h (v) By reason of the foregoing, the notice of appeal is void and the Court of Appeal therefore lacks the jurisdiction to entertain any proceedings based on that. i On 7 December, 2000 the Court of Appeal by a majority decision upheld the preliminary objection and held that the garnishee order absolute made by the High Court on 17 February, 1998 was an interlocutory decision and that the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd 117 a appeal filed on 27 March, 1998 by the second garnishee/ appellant was out of time and therefore incompetent. The second garnishee has further appealed to this Court. b In the appellant’s brief filed on behalf of the second garnishee, one issue was set down for the determination of this Court. It reads:– “Whether having regard to the circumstances of the case the final c garnishee order contained in the ruling of the court of first instance (Hon. Justice Mba Uduma, at the Osisioma Judicial Division of the High Court of Abia State) dated 17 February, 1998 is an interlocutory or final decision.” d The plaintiff/judgment creditor filed its respondent’s brief. It also raised a sole issue for the determination by this Court. It reads:– “Whether the majority decision of the Court of Appeal below to the effect that the decision of the High Court made on the 11 e February, 1998 was interlocutory and that an appeal therefrom outside fourteen days was incompetent is justifiable.” I am in complete agreement with the parties that the central question in this appeal is whether the ruling of the Abia f State High Court given on 11 February, 1998 was an interlocutory decision or a final decision. The contention on behalf of the plaintiff/judgment creditor is that the ruling in the garnishee proceedings was g an interlocutory decision. Based on this contention, it was submitted that having been filed more than 14 days without the leave of court having been sought and obtained, the notice of appeal is incompetent. h The issue for determination is simple really. It was needlessly made difficult and complicated by learned Counsel for the parties and the court below. The issue is not recondite. There is a plethora of cases decided by this Court i on this issue. I do not think it is necessary to review the submission of Counsel for the parties except to state that for its part the second garnishee/appellant has contended that the decision j of the High Court on 17 February, 1998 is a final decision

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC 118 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) because it determined the rights of the parties before it. It a relied on several cases decided by this Court on the point. This area of law in the Nigerian context need not raise any confusion, ingenuity of Counsel notwithstanding. There are b cases galore decided by this Court on this point to the effect that a decision of a court is final when it determines the rights of the parties. It seems to me therefore that the real test for determining this question ought therefore to be this:– c does the judgment or order as made, finally dispose of the rights of the parties? If the judgment or order has determined the rights of the parties, then it is unquestionably a final order; but if it does not, it is then an interlocutory order. See d Bozson v Altrinchan Urban District Council (1903) 1 IL 13 SS47. Unarguably, the question of what is an interlocutory or final decision before now had engaged the attention of the e courts in this country. However, this Court has, in Omonuwa v Oshodin and another (1985) 2 SC 1 given an authoritative decision on the matter. In that case this Court held that:– “. . . a decision between the parties can only be regarded as final f when the determination of the court disposes of the rights of the parties, (and not merely an issue), in the case.” In Akinsanya v United Bank for Africa Ltd (1986) 7 SC (Part 1) 233 this Court decided that:– g “. . . What renders an order of a court interlocutory or final with respect to a matter before it is its effect on the rights of the parties to the litigation. In all the cases, the test and dominant consideration has been whether the rights of the parties have been finally determined or not.” h See also Western Steel Works Ltd v Iron and Steel Workers Union (1986) 3 NWLR (Part 30) 617. This court has recently in Odutola v Oderinde (2004) All FWLR (Part 217) 615; (2004) 12 NWLR (Part 888) 574 i restated the position of the law. The court, per Kutigi JSC held:– “An order or decision is final when it finally disposes of the rights of the parties, that is to say, the decision or order given by the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd 119 a court is such that the matter would not be further brought back to the court itself, as in this case.” Perhaps, I should refer to a few English cases which have b been adopted in this country. In Salaman v Warner (1891) 1 QBD 734 at 736 Lopes L, in giving a more precise characterisation of final judgment or order said:– “I think a judgment or order would be final within the meaning of c the rules, when whichever way it went, it would finally determine the matter in dispute.” In Blakey v Latham (1889) 43 Ch D 25 the court said:– “I cannot help thinking that no order in an action will be final d unless a decision upon the application out of which it arises, but given in favour of the other party to the action would have determined the matter in dispute.” In Bozson v Altrinchan District Council (1903) 1 KB 547, e Lord Alverstone CJ in concurrence with the Earl of Halsbury LC, on the point said at pages 549 – 550:– “It seems to me that the real test for determining this question ought to be this – does the judgment or order as made finally dispose of the rights of the parties? If it does, then, I think it ought f to be treated as a final order; but if it does not, it is then, in my opinion, an interlocutory order.” In the instant case, the plaintiff, Boney Marcus Ind Ltd obtained judgment against the defendant Nichimen Co. g (Nigeria) Ltd. This was on 19 May, 1997. Thereafter the plaintiff filed garnishee proceedings against Metcome (Nig) Ltd and Union Bank of Nigeria Plc to realise the judgment debt and costs. On 17 February, 1998, the trial Judge granted h the application and accordingly made an order absolute, the terms of which I have earlier on in this judgment reproduced. The second garnishee – Union Bank of Nigeria Plc filed a i notice of appeal on 27 March, 1998 against that ruling. The plaintiff raised a preliminary objection to the competence of that notice on the ground that the appeal was filed out of time. It was the plaintiff’s contention that the garnishee j order absolute was an interlocutory decision and that being

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC 120 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) so, an appeal against it should and must be filed within 14 a days. The court below ruled that the garnishee order absolute was an interlocutory decision. The question to be resolved in this appeal is really b whether the decision of the trial court was interlocutory or final. I think the resolution of this question would depend on whether the garnishee order as made disposed of the rights of the parties before the court. c The order of the trial court was:– “. . . that the money belonging to the judgment debtor in possession of the 1st garnishee which money is in the 1st garnishee’s account with the 2nd garnishee be attached to satisfy d the judgment debt, together with the costs of the garnishee proceedings.” The above was the final garnishee order. In other words, it was an order absolute. It was a final decision of the court. A e judicial decision is said to be final when it leaves nothing to be judicially determined thereafter in order to render it effective and capable of execution. That is to say that the matter would not be brought back to the court itself for f further adjudication. Clearly, by the order of the court above, the trial court had determined the rights of the parties before it. I must state again that the appellant promptly complied with the order of the court. g This Court, in Odutola v Oderinde (2004) All FWLR (Part 217) 615; (2004) 12 NWLR (Part 888) 574 restated the position of the law in this respect. The court, per Kutigi JSC held:– h “An order or decision is final when it finally disposes of the rights of the parties, that is to say, the decision or order given by the court is such that the matter would not be further brought back to the court itself, as in this case.” See Akinsanya v United Bank for Africa Ltd (supra); i Western Steel Works Ltd Iron & Steel Workers Union (supra); Omonuwa v Oshodin and another (supra). In my judgment, based on the authorities I have cited, the order of 17 February, 1998 was a final order. In effect, the notice of j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Katsina-Alu JSC Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd 121 a appeal filed on behalf of the second garnishee/appellant on 28 February, 1998 was filed within time. In the result (sic) find no merit in the preliminary objection, which is b accordingly overruled. The appeal therefore succeeds and I allow it. The decision of the court below is set aside. The plaintiff/judgment creditor/objector shall pay costs of N10,000 in this Court c and N5,000 in the court below to the second garnishee/appellant.

KUTIGI JSC: I read in advance the judgment just delivered d by my learned brother Katsina-Alu JSC. I agree with him that the garnishee order absolute made by the High Court on 17 February, 1998 was a final order. The appeal therefore succeeds and it is hereby allowed. The decision of the court below is set aside. I endorse the order for costs. e EJIWUNMI JSC: As I have had the opportunity of reading the draft of the judgment just delivered by my learned brother, Katsina-Alu JSC, I also allow the appeal for the f reasons given in the said judgment. I also make the same orders made with regards to costs.

MUSDAPHER JSC: I have read before now the judgment of g my lord, Katsina-Alu JSC with which I entirely agree for the same reasons which I adopt as mine, I too find this appeal meritorious and is allowed by me. The decision of the lower court in upholding the preliminary objection is set aside, in h its place, the preliminary objection is dismissed. I abide by the order for costs contained in the aforesaid judgment.

AKINTAN JSC: The main issue raised in this appeal is whether a garnishee order made absolute by a court is an i interlocutory or final order. Garnishee proceedings are a process of enforcing a money judgment by the seizure or attachment of the debts due or accruing due to the judgment debtor which form part of his property available in j execution. It is therefore a species of execution of debts for

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JSC 122 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) which the ordinary methods of execution are inapplicable. a By this process, the court has power to order a third party to pay directly to the judgment creditor the debt due or accruing due from him to the judgment debtor, or as much b of it as may be sufficient to satisfy the amount of the judgment and the costs of the garnishee proceedings. See Words & Phrases Legally Defined (3ed) Volume 2, pages 313 – 314. c Applications for garnishee proceedings are made to the court by the judgment creditor and the orders of the court usually come to two steps:– The first is a garnishee order nisi. Nisi is a Norman-French word and it means “unless”. It d is therefore an order made, at that stage, that the sum covered by the application be paid into court or to the judgment creditor within a stated time unless there is some sufficient reason why the party on whom the order is e directed is given why the payment ordered should not be made. If no sufficient reason appears, the garnishee order is then made absolute and that ends the matter in that the party against whom the order absolute is made is liable to pay the f amount specified in the order to the judgment creditor. The court thereafter becomes functus officio as far as that matter is concerned in that the Judge who decided the matter is precluded from again considering the matter even if new evidence or argument are presented to him. See Choice g Investments Ltd v Jeronmimon (Midland Bank Ltd, Garnishee) [1981] 1 All ER 225 at 328 and Words & Phrases Legally Defined, Volume 2, page 301. h During the period between when the order nisi and the order absolute are made, the matter would still be pending before the court. In other words, the proceedings would still be at the interlocutory stage. But once the order absolute is made, there would be nothing left before the court in the i matter. The court has, at that stage, completely determined the matter between the parties as far as the proceedings are concerned. The court would be functus officio. There would then be nothing left to be determined by the court. The j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Akintan JSC Union Bank of Nigeria Plc v Boney Marcus Ind. Ltd 123 a question of the proceedings, at that stage, being interlocutory would therefore not arise. For the above reasons and the fuller reasons given in the b lead judgment written by my learned brother, Katsina-Alu JSC, which I had read before now, I agree that the garnishee order made absolute by the trial High Court was a final order and not interlocutory. I therefore agree with the conclusions c made in the lead judgment that the appeal should succeed. I too allow the appeal and set aside the decision of the court below with costs as assessed in the lead judgment. Appeal allowed.

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a Akanmu v Co-Operative Bank Plc and others

COURT OF APPEAL, IBADAN DIVISION b IBIYEYE, TABAI, AGBO JJCA Date of Judgment: 15 JULY, 2005 Suit No:. CA/I/272/2001

Banking – Indebtedness of customer – How proven c Facts This appeal is against the judgment of Honourable Justice Jimi Bode sitting at the Osun State High Court, Osogbo which judgment was delivered on 12 February, 2001. This d appellant was the plaintiff in the suit while the respondents were the defendants/cross-claimants. The appellant had in paragraph 39 of his amended statement of claim in the court below claimed of the defendant now respondents as e follows:– “1. Declaration that the amount entered as debit balance in the plaintiff’s Account No. PA. 11 with the 1st defendant is not a true and accurate reflection of the plaintiffs. f 2. Declaration that the plaintiff is not liable to pay any charge by whatever name called on any debit entries, improperly or wrongly entered by the 1st and 3rd defendants in the plaintiff’s account. g 3. An Order directing the 1st and 3rd defendant to furnish to the plaintiff, a true and accurate statement of the plaintiff’s Account No. PA. 11. 4. Declaration that the exercise of the power of rights of sale by the defendants of the plaintiff’s properties situate, lying and h being at Gbongan/ Osogbo Road, Owode via Ede. Osun State which are Woleysam Petrol Station and two bungalow buildings covered by deed of mortgage registered as No. 29 at Page 29 in Volume 43 and No. 30 at Page 30 in Volume i 43 respectively of the Land Registry in the office at Osogbo is null and sold and of no effect. 5. A declaration that the purported auction Sale/notice by the second defendant to the plaintiff is defective for non compliance with Auctioneer’s Law Cap. 10. Laws of Oyo j

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Akanmu v Co-Operative Bank Plc 125 a State of Nigeria. 1978 (applicable in Osun State and it is therefore null and void. 6. Injunction restraining the defendants, their agents, servants, b officers and/or privies from taking an step (sic) or any further steps towards or in pursuance of the decision of the defendants to sell the plaintiff’s properties situate lying and being at Gbongan/Osogbo station and two bungalow buildings covered by deed of mortgage registered as No. 29 c at Page 29 in Volume 43 and No. 30 at Page 30 in Volume 43 respectively of the Lands Registry in the office at Osogbo. 7. Any other relief that the plaintiff may be entitled to in this suit. d 8. The plaintiff claims the sum of N1,200,000.00 (One Million, Two Hundred Thousand Naira), one (sic) and third defendants jointly, severally and collectively being the cost of the plaintiffs 40 (Forty) Tons (640 bags) of Graded cocoa e beans which the first and third defendants removed and sold from the plaintiffs Cocoa Store in his absence without the plaintiff’s knowledge, consent and/or authority in January, 1990. 9. The plaintiff claims the sum of N192,000.00 (One Hundred f and Ninety-two Thousand Naira) being the cost of the plaintiff’s 640 (Six Hundred and Forty) empty bags of cocoa beans which the first and third defendants removed and sold from the plaintiffs cocoa store in his absence without his g knowledge, consent and/or authority sometime in January, 1990. 10. Interest at the rate of 15% (Fifteen percent) from the 15 January, 1990 till the judgment is delivered and at the rate of 10% from date of judgment till judgment debt is fully paid.” h The respondents joined issues with the appellants in their statement of defence and denied the claims. The first defendant/respondent further counter-claimed. i After taking evidence from the parties and taking their addresses, the court below in its judgment dismissed the plaintiff’s claim and granted the first defendant’s counter- claim in full. Dissatisfied with that judgment, the appellant j on 2 May filed this appeal.

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To fully appreciate these provisions of the Evidence Act a Cap 112 Laws of the Federation of Nigeria, 1990, section 97(1)(h) and 97(2)(e) are set out hereunder:– “97 (1) Secondary evidence may be given of the existence, b condition or contents of a document in the following cases– (h) When the document is an entry in a banker’s book. . . . c (2) The secondary evidence admissible in respect of the original documents referred to in the several paragraphs of subsection (1) of this section is as follows– (e) in paragraph (h) the copies cannot be received as d evidence unless it be first proved that the book in which the entries copied were made was at the time of making one of the ordinary books of the bank, and that the entry was made in the usual and ordinary course of business, and that the book is in e the custody and control of the bank, which proof may be given orally or by affidavit by a partner or officer of the bank, and that the copy has been examined with the original entry and is correct, which proof must be given by some person who f has examined the copy with the original entry and may be given orally or by affidavit.”

Held – g 1. The appropriate method used by a bank to establish the indebtedness of its customer is through the entries in its books. Because of the bulky nature of these books, the banker is allowed to prove these entries by secondary h evidence. But this is regulated by sections 97(1)(h) and 97(2)(e) of the Evidence Act. 2. As found by the court below, exhibit “AA” and “BB” are not correct copies of the banker’s books. They should i not have been admitted in evidence in proof of defence case and where so wrongly admitted ought to have been expunged from the records. The court founded its judgment for the respondent in its counter-claim entirely j

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Akanmu v Co-Operative Bank Plc 127 a on these exhibits. That judgment must go with these exhibits. Appeal allowed in part. b Cases referred to in the judgment Nigerian c Akinloye v Eyiyola (1968) NMLR 92 George v Dominion Flour MilIs Ltd (1963) 1 SCNLR 117 Oasazuwa v Edo State Civil Service Commission (1999) 4 d NWLR (Part 597) 155 Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 Ransome Kuti v A-G, Federation (1985) 2 NWLR (Part 6) 211 e Yassin v Baclays Bank DCO (1968) NMLR 380 Yesufu v ACB Ltd (1976) All NLR 328 f Nigerian statute referred to in the judgment Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, sections 97 (1)(h) and 97 (2)(e) g Counsel For the appellant: Fashola For the respondent: Fowe h Judgment AGBO JCA: (Delivering the lead judgment) This appeal is against the judgment of Honourable Justice Jimi Bode i sitting at the Osun State High Court, Osogbo which judgment was delivered on 12 February, 2001. This appellant was the plaintiff in the suit while the respondents were the defendants/cross-claimants. The appellant had j in paragraph 39 of his amended statement of claim in the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA 128 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) court below claimed of the defendants now respondents as a follows:– “1. Declaration that the amount entered as debit balance in the plaintiff’s Account No. PA. 11 with the 1st defendant is not a b true and accurate reflection of the plaintiffs. 2. Declaration that the plaintiff is not liable to pay any charge by whatever name called on any debit entries, improperly or wrongly entered by the 1st and 3rd defendants in the plaintiff’s account. c 3. An order directing the 1st and 3rd defendant to furnish to the plaintiff, a true and accurate statement of the plaintiff’s Account No. PA. 11. 4. Declaration that the exercise of the power of rights of sale by d the defendants of the plaintiff’s properties situate, lying and being at Gbongan/ Osogbo Road, Owode via Ede, Osun State which are Woleysam Petrol Station and two bungalow buildings covered by deed of mortgage registered as No. 29 e at Page 29 in Volume 43 and No. 30 at Page 30 in Volume 43 respectively of the Land Registry in the office at Osogbo is null and void and of no effect. 5. A declaration that the purported auction sale/notice by the second defendant to the plaintiff is defective for non f compliance with Auctioneer’s Law Cap. 10 Laws of Oyo State of Nigeria, 1978 (applicable in Osun State and it is therefore null and void. 6. Injunction restraining the defendants, their agents, servants, g officers and/or privies from taking any step or any further steps towards or in pursuance of the decision of the defendants to sell the plaintiff’s properties situate lying and being at Gbongan/Osogbo station and two bungalow buildings covered by deed of mortgage registered as No. 29 h at Page 29 in Volume 43 and No. 30 at Page 30 in Volume 43 respectively of the Lands Registry in the office at Osogbo. 7. Any other relief that the plaintiff may be entitled to in this suit. i 8. The plaintiff claims the sum of N1,200,000.00 (One Million, Two Hundred Thousand Naira) 1st (sic) and 3rd defendants jointly, severally and collectively being the cost of the plaintiffs 40 (Forty) Tons (640 bags) of Graded cocoa beans which the 1st and 3rd defendants removed and sold from the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 129 a plaintiffs Cocoa Store in his absence without the plaintiff’s knowledge, consent and/or authority in January, 1990. 9. The plaintiff claims the sum of N192,000.00 (One Hundred b and Ninety Two Thousand Naira) being the cost of the plaintiff’s 640 (Six Hundred and Forty) empty bags of cocoa beans which the 1st and 3rd defendants removed and sold from the plaintiffs cocoa store in his absence without his knowledge, consent and/or authority sometime in January, c 1990. 10. Interest at the rate of 15% (Fifteen percent) from the 15 January, 1990 till the judgment is delivered and at the rate of 10% from date of judgment till judgment debt is fully d paid.” The respondents joined issues with the appellants in their statement of defence and denied the claims. The first defendant/respondent further counter-claimed from e paragraphs 21 to 26 of the amended statement of defence as follows:– “21. The defendants plead and repeat paragraphs 1 – 20 of the amended statement of defence by way of counter claim and f aver further as follows. 22. The various credit facilities granted to the plaintiff were done in the normal course of banking business which facilities attracted varying rates of interest as stipulated from time to g time by the 1st defendant and capitalized monthly. 23. The statements of account were never controverted by the plaintiff. 24. The various credit facilities which were fully utilized by the h plaintiff resulted in the plaintiff becoming indebted to 1st defendant in the sum of N498,857.76 (Four Hundred and Ninety Eight Thousand, Eight Hundred and Fifty-Seven Naira and Seventy Six Kobo). i 25. The plaintiff instead of paying up his just debt applied for stoppage of interest on his account which request was rejected. 26. Where of the 1st defendant counter claims against the plaintiff the sum of N498,857.76 (Four Hundred and Ninety- j Eight Thousand, Eight Hundred and Fifty Seven Naira and

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Seventy Six Kobo) being the plaintiff’s indebtedness to it as a at the 21 June, 1995. Interest on the said sum at the rate of 21% per annum from the 22 June, 1995 until whole debt is finally liquidated”. b After taking evidence from the parties and taking their addresses, the court below in its judgment dismissed the plaintiff’s claim and granted the first defendant’s counter- claim in full. Dissatisfied with that judgment, the appellant c on 2 May filed this appeal. He set out the following grounds of appeal:– “1. The learned trial Judge erred in law and on facts when he held thus– d ‘. . . That the plaintiff is not entitled to N1,200,000.00 (One Million, Two Hundred Thousand Naira) from the defendants because the cocoa was removed and sold from the plaintiff’s store with his knowledge, consent e and authority. I also hold that the defendants are not liable to pay N192,000.00 (One Hundred and Ninety Two Thousand) being cost of 640 empty bags of cocoa beans because it was removed and sold from the plaintiff’s cocoa store with the plaintiff’s consent, f knowledge and authority.’ Particulars of Error (i) The sale of the graded 40 tons of Cocoa beans and the g 640 empty cocoa bags by the 1st defendant was without the express or ostensible authority from the plaintiff to sell same. (iiii) The sale of the graded 40 tons of cocoa beans and the h 640 empty cocoa bags by the 1st defendant was tainted with undue influence exercised over the plaintiff by the 1st defendant knowing fully well that the plaintiff was in custody at Iyaganku Police Station, Ibadan for an alleged armed robbery case. i 2. The learned trial Judge erred in law in entering judgment for the defendants/respondents when the evidence of D.W.1 Oladayo Oladipo (the only witness to the defendants/ respondents) at the trial was at variance with their pleadings. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 131 a Particulars of Error (i) The defendants/respondents witness (i.e. D.W.1) claimed at the trial to have visited the plaintiff not less b than 4 (four) times at Iyaganku, police station, Ibadan and at Agodi prisons on about 5 (five) occasions and that during one of his visits to the plaintiff, the plaintiff called him and requested that the 1st defendant should help him sell his cocoa whereas this c piece of evidence was never pleaded in the amended statement of defence and counter claim. (iiiiii) The D.W.1 gave evidence at the trial that he weighted the cocoa in the presence of the following– d The Police; One of the wives; The bank; The person who wanted to buy it but all those were e not pleaded in the amended statement of defence and counter-claim. 3. The learned trial Judge erred in law and on the facts by not holding that the sale of the plaintiff/ appellant’s 40 tons of graded cocoa beans and 640 empty cocoa bags by the 1st f defendant to one Alhaji Omidiran was illegal thereby rendering the whole contract of sale null and void. Particulars of Error (i) The plaintiff/appellant’s 40 tons of graded cocoa g beans and the 640 empty cocoa bags were not part of the properties the plaintiff/ appellant provided as securities to the 1st defendant. (ii) Sale of the plaintiff/appellant’s properties which are h not included in the security provided by the plaintiff without an order of the court is invalid, null and void. (iii) The sale of the plaintiff/appellant’s 40 tons of graded cocoa beans and the 640 empty cocoa bags were not i witnessed by an officer or officers duly authorised by the court. (iv) The sale of the plaintiff/appellants graded 40 tons of cocoa beans and 640 empty cocoa bags was not authorised by the order of any court and there was no j application before any court to carry out the said sale.

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(v) The name of the police who witnessed the sale, his or a her force number, his or her rank in the force or his or her police station was never identified and that police was never called as a witness. b (vi) One of the plaintiff/appellant’s wives and the bank who witnessed the sale was not identified. (vii) The person who purchased the plaintiff/ appellant’s graded cocoa beans and the empty cocoa bags, Alhaji Hammed Omidiran never appeared throughout the c trial. 4. The learned trial Judge erred in law when he failed to hold that the 1st defendant exceeded his authority and acted illegally by disposing by way of sale the plaintiff/appellant’s d 40 tons of graded cocoa beans and 640 empty cocoa bags when there were no express or implied authority from the plaintiff/ appellant to the 1st defendant/respondent to sell the goods. Particulars of Error e (i) The securities provided by the plaintiff/ appellant as collateral for the grating of the loan by the 1st defendant are– (a) 2 bungalows at Owode, Ede; f (b) Petrol Station at Owode, Ede and (c) Passbook No. 296 with N4,916.05 credit balance. (ii) It never included 40 tons of graded cocoa beans and g 640 empty cocoa bags. (iii) The collateral securities are the legal properties of the plaintiff/appellant which he offered to the 1st defendant in respect of the loan transaction between h the plaintiff and the 1st defendant. (iv) Although the loan facility granted to the plaintiff/appellant by the 1st defendant was said to expire in February, 1990, the 1st defendant sold the 40 i tons of the graded cocoa and 640 empty cocoa bags before the expiry date. (v) The right to enforce the payment of debt (if any) by legal action is limited to the securities provided by the plaintiff/appellant to the 1st defendant. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 133 a 5. The learned trial Judge erred in law and on facts by not awarding to the plaintiff, the market value of 40 tons of graded cocoa beans and 640 empty cocoa bags as at the time of sale by the 1st defendant/respondents when market value b was N1,200,000.00 for the 40 tons of graded cocoa beans and N192,000.00 for the 640 empty bags of cocoa beans. Particulars of Error (i) It is a common ground between the parties that the c 409 tons of cocoa beans were graded before the sale. (ii) The defendants/respondents did not state the cost price of a ton of graded cocoa beans and the cost of an empty cocoa bag in his evidence before the lower d court. (iii) In rebuttal of the value of the 40 tons of graded cocoa beans and 640 empty cocoa bags as N1,200,000.00 did not adduce any evidence or call any expert opinion on cocoa price or even call the person that bought the e cocoa to give evidence. (iv) The sale of the graded cocoa beans by private arrangement between the 1st defendant/respondent and one Alhaji Omidiran is not sale in market overt. f (v) The sale of graded cocoa beans without an auction notice to do so is not sale in market overt. 6 The learned trial Judge erred in law and on facts by holding the ‘the 1st defendant through and statement of account g exhibits “AA” and “BB” was able to show that the plaintiff was owing the 1st defendant the sum of N498,857.76. as at 21/6/95’ and thereby came to a wrong decision. Particulars of Error h (a) Exhibit ‘AA’ and ‘BB’ were made and prepared by the 1st defendant without the consent and knowledge of the plaintiff/ appellant. (b) Exhibit ‘AA’ and ‘BB’ were self serving document (sic) i to suit the purpose of the 1st defendant/respondent. (c) The 1st defendant/respondent having admitted that there were machine error (sic) in the calculation of the accounts of the plaintiff, the learned trial Judge ought to have expunged exhibits ‘AA’, exhibits “AA” and “BB” j from the records.

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7. The learned trial Judge erred in law when he held as follows– a ‘The defendant on the other hand tendered exhibits “AA” and “BB” i.e. the statement of account of the plaintiffs. The D.W1 stated that exhibits “AA” and b “BB” were produced from the ordinary books of the bank. Although there are machine errors in said exhibits “AA” and “BB” but according to D.W.1 and exhibit “AA” the plaintiffs indebtedness as at 1995 was N498,857.76.’ c Particulars of Error (a) The learned trial Judge no doubt believed that there were machine errors in the calculation of the account of the plaintiff; he still went to find for the defendant on d uncertain facts and figures. (b) The degree of machine error in the calculation of the account of the plaintiff was never resolved. (c) The award of N498,857.75k to the 1st defendant as debt of the plaintiff was based on mere imagination, whims e and caprices of the Judge. (d) The machine error admitted by the defendant is enough for the Judge to hold that the plaintiff was not indebted to the 1st defendant/ respondent. f (e) The D.W.1 testified at the lower court that the 1st defendant does not operate weekend banking vat (sic) exhibits “AA” and “BB” show that on 4/4/87 (which was a (Saturday) the plaintiff/appellant withdrew the g sum of N11,500.00 from the 1st defendant with cheque No. 293117; the amount which was debited into the plaintiff/appellant’s account. (f) On 13/2/84 the plaintiff paid N300.00 to the 1st defendant through Teller No. 314548 (exhibit “D”) h which was not reflected in the statement of account, i.e. exhibits “AA” and “BB”. (g) On 27/2/84 the plaintiff paid N300.00 to the 1st defendant through Teller No. 314549 (i.e. exhibit “D”) i which was not reflected in the statement of account i.e. exhibits “AA” and “BB”. (h) The plaintiff/appellant paid N1,000.00 to the 1st defendant through Teller No. 176903 (exhibit D7) on 22/1/92 but it was reflected in the statement of account j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 135 a i.e. exhibits “AA” and “BB” to have been paid on 20/1/92. (i) The plaintiff paid N250.00 to the 1st defendant through b Teller No. 288330, i.e. exhibit “Dl”, on 8/5/91 but it was reflected in the statement of account, exhibit “AA” and “BB” to have been paid on 6/5/91. (j) The payment of N1,000.00 which the plaintiff made to the 1st defendant through exhibit “D3”, Teller No. c 757574 of 31/7/89 is reflected to have been paid on “July, 1989” (k) The plaintiff paid N500.00 through Teller No. 757576 of exhibit “D3” on 9/8/89 but it was recorded in exhibits d “AA” and “BB” to have been paid on 7/8/89. (l) The plaintiff paid N100.00 to the 1st defendant on 21/5/90 through Teller No. 757585. exhibit “D3” but it was recorded in exhibits “AA” and “BB” i.e. the e statement of account to have been paid on 1/ 5/90 which was a public holiday. (Worker’s Day). (m) The plaintiff paid N1,400.00 to the 1st defendant on 23/12/88 through Teller No. 422044 (exhibit “D2” but it was recorded to have been paid in on 13/12/88 in f exhibits “AA” and “BB” i.e. the statement of account. (n) The plaintiff paid N1,000.00 to the 1st defendant on 23/1/89 by Teller No. 422050, exhibit “D2” but exhibits “AA and “BB” show that it was paid on 25/1/89. g (o) The plaintiff paid N4,500.00 on 6/4/87 to the 1st defendant through Teller No. 684454 i.e. exhibit “D4” which is never reflected in the statement of account, i.e. exhibits “AA” and “BB”. h (p) The plaintiff paid N2,500.00 to the 1st defendant on 11/8/86 through Teller No. 988760, exhibit “D6”, but it reflected on exhibits “AA” and “BB” to have been paid in on 21/8/86. i (q) On 9/3/87, the plaintiff paid N1,500.00 to the 1st defendant through Teller No. 988797, exhibit “D6”. But it was recorded in exhibits “AA” and “BB” to have been paid in on 16/3/87. 8. The learned trial Judge erred in law and on facts by not j dismissing the counter claim of the 1st defendant as there

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were no evidence led as to the claim of N498,857.76 a allegedly owed to the 1st defendant by the plaintiff. Particulars of Error (a) Having held that there were machine errors in the b account of the plaintiff, the counter claim should have been dismissed. (b) D.W.1 stated as follows– “And as at 1995, the plaintiff’s indebtedness to the 1st defendant was N498,857.76k”. c No further evidence apart from erroneous exhibits “AA” and “BB” to support the counter-claim. (c) D.W.1 Oladiya Oladipo was only a senior manager of the 1st defendant and not an accountant or auditor of the d 1st defendant/ respondent.” The appellant filed his brief of argument and reply brief. The respondents filed their brief of argument. The appellant set out two issues for determination on page 5 paragraphs 201 e and 202 of his brief as follows:– “201. Whether the 1st and 3rd defendants/respondents had shown that the plaintiff/appellant gave them authority to sell his forty Tons (40 Tons) of the graded cocoa beans and the six f hundred and forty empty bags (640 bags) when the defendants/ respondents did not plead such evidence. 202. Whether the learned trial Judge was right in relying on and making use of exhibits “AA” and “BB” (statement of account) when there was an admission of error in their g productions.” The respondent on the other hand distilled only one issue for determination and that is “whether it is the appellant who is indebted to the first respondent or vice versa”. h A careful perusal of the grounds of appeal shows that neither the two issues distilled by the appellant nor the single issue by the respondent cover fully the issues arising from the grounds of appeal for determination. When i however the respondents issues for determination is joined to appellant’s two issues, the grounds of appeal appear fully covered. I shall therefore take the three issues in determining this appeal. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 137 a The first issue for determination raised by the appellant is “whether the 1st and third defendants/respondents had shown that the plaintiff/ appellant gave them authority to sell b his forty tons of his graded cocoa beans and the six hundred and forty empty bags when the defendants/ respondents did not plead such evidence”. On this issue, appellant’s counsel had argued strenuously that the evidence of the only defence c witness that he was authorised by the plaintiff/appellant to sell the cocoa beans and bags in contention is at variance with the paragraph 8 of the plaintiffs pleading which state inter alia:– d “The 1st defendant, through the assistance of 2nd defendant took prompt steps to salvage the plaintiff’s situation by assisting him in selling some of his graded cocoa beans to his major suppliers who credited the proceeds of same into the plaintiffs account to reduce his indebtedness.” e DW1 had testified that he had visited the appellant in custody five times and was authorised by the appellant to dispose of the appellant’s cocoa beans which he did and paid the proceeds into the appellant’s bank account with the first f defendant/respondent. The appellant’s position here is that paragraph 8 of the defendant’s pleadings having stated that the third defendant assisted the first defendant in selling the graded cocoa beans, g any evidence that any other person played any role in the said sale go to no issue. Appellant’s counsel had laboured under the very wrong impression that a litigant is expected in his pleadings to plead all the EVIDENCE he will be h placing before the court in urging his case. That is wrong. In all courts of pleadings, what a party is required to plead are the FACTS upon which he would be founding his case. Appellant’s Counsel rightly stated the legal position when i in his argument he had said:– “It is fundamental that issues before the court are decided on the pleadings of the parties. A party must state all the material facts which he relies upon in support of his claim before the court. j Material facts not pleaded cannot be raised at the trial. See Chief

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(Dr.) (Mrs.) Olufunmilayo Ransome Kuti & Ors. v A.G. a Federation & Ors. (1986) 6 S.C. 246 at 306; (1985) 2 NWLR (Pt. 6) 211.” There is no way it can be concluded that paragraph 8 of the b plaintiff’s pleadings suggest of no other activity by any other person acting on behalf of the first defendant who is an artificial person except the third defendant. It is an accepted fact that the DW1 was at all material times an employee of c the first defendant. The appellant’s counsel’s appreciation of paragraph 8 of plaintiff’s pleadings is too constricted. Evidence by other persons outside the third defendant that they acted on behalf of the first defendant/respondent in its d relationship with the plaintiff and partook in the contentious sale of the plaintiff’s cocoa beans and bags come comfortably within the ambit of paragraph 8 of the plaintiff’s pleadings. The court below was right in admitting e the evidence of DW1 that he was authorised by the plaintiff to sell plaintiff’s cocoa beans and bags and that the money realized from the sale was paid into the plaintiff’s account with the first defendant. I find no merit in appellant’s issue No. 1. f Issue No. 2 is “Whether the trial court was right in relying on and making use of exhibits “AA” and “BB” (statement of account) when there was an admission of error in their g production.” Exhibits “AA” and “BB” were statements of account prepared by the respondent. They show that as at 1995 the appellant was indebted to the respondent in the sum of N498,857.76. Exhibits “AA” and “BB” constitute h secondary evidence of the respondents’ banker’s book. The court below found as of fact that the exhibits contained “Machine errors”. In effect the exhibits do not contain the correct record in the banker’s books. The appropriate method used by a bank to establish the indebtedness of its i customer is through the entries in its books. Because of the bulky nature of these books, the banker is allowed to prove these entries by secondary evidence. But this is regulated by section 97(1)(h) and 97(2)(e) of the Evidence Act. See j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 139 a Obijiaku v NDIC (2002) 10 NWLR (Part 774) 201 at 215; Yassin v Barclays Bank DCO (1968) NMLR 380; Yesufu v ACB Ltd (1976) 1 All NLR 328. b To fully appreciate these provisions of the Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 referred to above section 97(1)(h) and 97(2)(e) are set out hereunder:– “97 (1) Secondary evidence may be given of the existence, c condition or contents of a document in the following cases– (h) when the document is an entry in a banker’s book. (2) The secondary evidence admissible in respect of the d original documents referred to in the several paragraphs of subsection (1) of this section is as follows– (e) in paragraph (h) the copies cannot be received as evidence unless it be first proved that the book in which the entries copied were made was at the e time of making one of the ordinary books of the bank, and that the entry was made in the usual and ordinary course of business, and that the book is in the custody and control of the bank, which proof f may be given orally or by affidavit by a partner or officer of the bank, and that the copy has been examined with the original entry and is correct, which proof must be given by some person who has examined the copy with the original entry and g may be given orally or by affidavit.” As found by the court below, exhibits “AA” and “BB” are not correct copies of the banker’s books. They should not have been admitted in evidence in proof of defence case and h where so wrongly admitted ought to have been expunged from the records. The court founded its judgment for the respondent in its counter-claim entirely on these exhibits. That judgment must go with these exhibits. i The respondent in its brief of argument raised a single issue” who is owing who”? The appellant as plaintiff admitted in his pleadings to having taken some loans from the respondent and secured them by mortgaging to the respon- j dent some property. It is the attempt by the respondent to

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA 140 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) realize those mortgages that gave rise to this suit. The a appellant claims to have fully repaid these loans and the interests accruing thereon. He who alleges proves. The appellant took out this suit in 1995. On 10 January, 1994 he b wrote exhibit “Y” to the respondent. Exhibit “Y” is reproduced hereunder:– “Wolesam Petroleum, Owode Ede, c Osogbo. The Branch Manager. Co-operative Bank Plc., Osogbo. d Dear Sir, Re– Interest on overdraft I hereby request and beg the management to please for now stop charging monthly interest on my secured overdraft with your e Osogbo Branch. My predicament started when I was robbed in 1990 and was erroneously detained at the police station for more than 5 months before I was discharged and acquitted. Since the incident, my business has suffered a great set back. f For now I deal with petty trade to enable me meet the two ends. I am through this forum appealing to the management to stop the interest charged monthly so as to enable me operate my account to the best of my ability. g Awaiting your favourable reply. Yours faithfully, Sgd. MEMUDU AKANMU”. The first paragraph of exhibit “Y” says it all. Appellant was h pleading with the respondent “to please for now stop charging monthly interest on my secured overdraft with your Osogbo branch”. How much was outstanding he neither pleaded nor proved. Having not discharged the onus placed i on him to prove his case, the court below was right in holding the appellant indebted to the respondent. On the whole, the appellant’s appeal against the dismissal of his case fails and is hereby dismissed. His appeal against j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Agbo JCA Akanmu v Co-Operative Bank Plc 141 a the judgment allowing the counter-claim succeeds. How- ever, it having been found that the appellant is in fact indebted to the respondent, dismissing the counter-claim b will constitute a travesty of justice. Following in the footsteps of the Supreme Court in Yesufu v ACB Ltd (1976) 1 All NLR 328 I hereby non-suit the respondent in its counter-claim. There shall be no order as to costs. c IBIYEYE JCA: I have had the advantage of reading in draft the judgment of my learned brother Agbo, JCA. I agree with him that the appeal on the main claim has no merit and it is accordingly dismissed. The judgment of the trial court in the d main appeal is thereby affirmed. The respondent’s counter-claim, however, appears to be meritorious. This is so because issue 2 has a grouse with the propriety of exhibits “AA” and “BB” (the statements of e account of the appellant). It is not in doubt from the state of the record of proceedings that these two exhibits are secondary items of evidence having been produced from one of the ordinary books of the respondent in keeping with f section 97(1)(h) of the Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 (hereinafter referred to as the Evidence Act). In view of the peculiar nature of making use of extracts from banker’s book of entries, paragraph (h) of g section 97(1) of the Evidence Act must be read along with paragraph (e) of section 97(2) of the same Act. The provision of both paragraphs referred to have already been reproduced in the lead judgment. What is of particular h moment in section 97(2) (supra) vis-à-vis the instant case is “. . . The copy has been examined with the original entry and is correct . . .”. The learned trial Judge found as a fact that exhibits “AA” and “BB” contained “Machine errors”. In view of the patented errors found in exhibits “AA” and i “BB” they did not attract any probative value. They ought to have been rendered inadmissible by the learned trial court. The learned trial Judge, with due regard, failed to do so. It is settled that where a matter has been improperly received in j evidence in the court below, even when no objection has

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, IBADAN DIVISION) Ibiyeye JCA 142 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) been raised, it is the duty of the appellate court to reject and a decide the case on admissible or legal evidence as doing so will serve the best interest of justice. See George v Dominion Flour Mills Ltd (1963) 1 All NLR 71; (1963) 1 b SCNLR 117; Akinloye v Eyiyola (1968) NMLR 92 and Osazuwa v Edo State Civil Service Commission (1999) 4 NWLR (Part 597) 155. In the instant case, exhibits “AA” and “BB” which are not legally admissible are disregarded c and expunged. Since exhibits “AA” and “BB” were pivotal to the granting of the counter-claim to the respondent and those exhibits have been expunged or discountenanced, the said claim is thereby rendered baseless. Issue 2 is resolved in favour of the appellant, judgment entered in favour of the d respondent in respect of the counter-claim by the trial court is set aside. The appeal succeeds in part. I make no order as to costs. TABAI JCA: I had a preview of the leading judgment e prepared by my learned brother Agbo, JCA I agree with the reasoning and conclusion. There is no merit in the appeal in respect of the claim and is accordingly dismissed by me also. There is, however f merit in the appeal in respect of the counter-claim and which is accordingly allowed by me also. The judgment with respect to the counter-claim is therefore set aside. I abide by the consequential orders in the leading judgment. g Appeal allowed in part, counter-claim dismissed.

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Ndoma-Egba v African Continental Bank Plc 143 a Ndoma-Egba v African Continental Bank Plc b SUPREME COURT OF NIGERIA KUTIGI, ONU, KALGO, PATS-ACHOLONU, OGUNTADE JJSC Date of Judgment: 15 JULY, 2005 Suit No.: SC.40/2001

Banking – Account – Partnership account – Mandate c thereon – Two parties to sign jointly – Duty of bank to comply Banking – Banker and customer relationship – Negligence of bank in paying forged cheque – How determined – Duty d of court Banking – Cheques – Allegation by customer in pleadings that cheque forged because he did not sign cheque – e Whether use of the word “forge” connotes “forgery” in a criminal offence – Burden of proof on customer – Whether beyond reasonable doubt – Section 138(1) Evidence Act Banking – Cheques – Forged cheque – Implication of – f Negligence by bank in paying – How determined section 2 Bills of Exchange Act Banking – Joint account – Mandate that both signatories to sign – Duty of bank to honour instructions – Extent of g Facts The plaintiff/appellant was the senior partner in a law firm registered as Ndoma Egba, Ebiri and Company. The law h firm had a registered office at Calabar. It maintained a current account No. 0576 with the defendant, bankers, at the defendant’s branch situate at Calabar Road, Calabar. It was a “clients account”. In order to operate the account, the law i firm filled with the defendant a mandate, which indicated that the cheques and instruments of the law firm, to be valid, ought to be jointly signed by the two legal practitioners in the law firm, that is, the plaintiff Victor j Ndoma Egba and Richard David Ebri. A card showing the

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144 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) specimen signatures of the two legal practitioners was filled a and left with the defendant. The law firm later paid a cheque for N500,000 into its account with the defendant. The cheque had been received b for a client of the law firm Messrs. Reynold Construction Company Ltd (hereinafter referred to as RCC). RCC later instructed the law firm to pay a part of the N500,000 to its sister company called NWRD. The law firm issued the c cheque on 12/3/93. On 30/3/93 plaintiff called at the defendant’s branch to ascertain if the cheque issued had been paid. He was however informed that although the said cheque for N375,000 had not yet been presented the law d firm had only N2,000 in its account. Upon further enquiry, the plaintiff discovered that three different cheques for N225,000, N31,000 and N75,000 had been paid out of the account on 1/3/93, 1/3/93 and 12/3/93 respectively. These e came to a total sum of N331,000. The cheques for N31,000 and N75,000 had been paid to one Oluwaseyi Fabelurin and the one for N225,000 to the defendant. The plaintiff pleaded that the defendant had been f negligent by not observing the instructions left with it on the mandate card as to who could validly sign cheques and instruments on behalf of the law firm. The cheque, issued by the law firm to NWRD was dishonoured by the defendant on g its presentment. Embarrassed, the plaintiff by its letters wrote to the defendant to demand a refund or restitution. The defendant denied liability. The plaintiff claimed from the defendant/respondent for h the following:– “(i) The sum of N331,000.00 unlawfully withdrawn from the plaintiff’s Current Account No. 05756 as a result of the defendant’s negligence and collusion. i (ii) Interest on the principal sum calculated at the rate of 52% from the date of withdrawal until judgment. (iii) N5 million (Five Million Naira) being general damages for breach of contract, negligence for breach of contract, negligence and loss of reputation.” j

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Ndoma-Egba v African Continental Bank Plc 145 a The defendant denied plaintiff’s claim. It pleaded that on 1/3/93, Mr Richard D Ebri wrote to the defendant requesting for a bank draft for N225,000 in favour of a stated company. b The law firm’s cheque for N225,000 was annexed to the letter. The other withdrawals of N31,000 and N75,000 were made by the law firm’s accountant Oluwaseyi A Fabelurin who had hitherto made huge withdrawals on the law firm’s c behalf. The plaintiff had introduced the accountant to the defendant and the defendant had in good faith dealt with him. The cheques against which the three payments were made had carried signatures, which were regular on their face. The signatures on the cheques were those of the d plaintiff and Mr Richard Ebri. Mr Richard Ebri had not complained that his signature was forged. The defendant pleaded that the plaintiff had been negligent or contributorily negligent. e The trial Judge heard the case on this state of pleadings. The learned trial Judge awarded to the plaintiff the sum of N331,000 being the amount alleged to have been unlawfully f withdrawn from the account of the law firm and a further sum of N502,000 as general damages. Dissatisfied with the said judgment, the defendant brought an appeal against it before the Court of Appeal, Calabar Division (hereinafter g referred to as the “court below”). The court below in its judgment on 11/4/2000, allowed the appeal. It set aside the award made by the trial court and dismissed the plaintiff’s suit. h The plaintiff appealed to the Supreme Court.

Held – 1. The plaintiff’s case as conceived and put across would i succeed, as it did, if he succeeded in showing that he did not sign the signature ascribed to him in exhibits “2”, “3” and “4”. The use of the word “forge” in the context of this case cannot be equated with the use of the same j word as “forgery” in a criminal offence. “Forge” in this

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case has a secondary connotation and it means no more a than that the plaintiff did not sign the cheques exhibits “2”, “3” and “4”. Section 138(1) would apply only where the commission of a crime is imputed to a person b in a civil trial. As the plaintiff was not saying that a particular person had forged his signature, he did not bear the burden of establishing the case on a standard beyond reasonable doubt. c 2. The plaintiff in its mandate exhibit “1” left written instructions and notice with the defendant that its cheques must only be signed by the two partners jointly. Clearly therefore the defendant had notice of the limit on d the authority of PW2 to sign cheques on behalf of the partnership. Sections 5, 10 and 15 of the Partnership Act, 1890 only offer protection to an outsider dealing with a member of a partnership only to the extent that the outsider is unaware of the limit of the authority of the e partners with whom he is dealing. 3. Where a bank agrees to honour instructions signed by both account holders in a joint account, it imputs (sic) a negative duty not to honour instructions not signed by f both account holders. This duty also could, in theory, have been owed jointly, but must to make sense have been owed to the account holders severally, because the only purpose of requiring two signatures was to obviate g the possibility of independent action by one account holder to the detriment of the other. A duty on the defendants, which could only be enforced jointly with the party against the possibility of whose misconduct a h safeguard, was sought, and where the occurrence of such misconduct through the negligent breach of mandate by the defendants would deprive the innocent party of any remedy, would in practical terms be worthless. Indeed, it would be worse than worthless, because a customer i would reasonably rely on the two signature safeguard and refrain from active supervision of the account, only to find when loss (allegedly irreparable) has resulted that the reliance was misplaced. j

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Ndoma-Egba v African Continental Bank Plc 147 a 4. When the plaintiff and PW2 jointly executed the mandate form exhibit “1”, it must have dawned on the defendant that each wanted to protect himself from a b situation where the other could unilaterally withdraw the partnership funds. The defendant therefore owed each of the two partners the duty not to allow either of them to draw funds from the partnership account without the c concurrence of the other, which concurrence must be signified by the signature of that other as stated in exhibit “1”. It amounts to making a nonsense of the purpose of giving the mandate exhibit “1” for the court below to rely on the Partnership Act, 1890 to create an d escape route for the defendant in its obligations to the partners. 5. It is not the law that when a banker pays money out from e a customer’s account on a cheque which he believes to be genuine but which turns out to be a forgery, the banker, is willy nilly liable. The basis of liability in such a case is the failure to exercise reasonable care and diligence to process this cheque before payment. If there f is cogent evidence, which the court accepts, that the banking official before paying out money from a customer’s account on a forged cheque did all that is necessary to compare the signature on the cheque, which g turns out to be forged with the specimen signature of the customer in its possession, the basis of liability in negligence is displaced. In the instant case however, there was not a shred of evidence on the pre-payment h formalities done by the defendant by the clerk or official who paid, as to whether the signature of plaintiff on exhibits “2”, “3” and “4” was at any stage compared with the plaintiff’s specimen signature on exhibit “1”. i 6. In coming to the conclusion as to a banker’s negligence, it is always important to look at the disputed signature and compare same with the authentic signature to discover if the dissimilarities are so obvious as to be j easily discernible.

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7. Under section 2 of the Bills of Exchange Act, 1882, a a forged or an unauthorised cheque is inoperative. It may well be that the defendant may have its remedies against PW2 who was shown to have signed exhibits “2”, “3”, b “4” and “16”, but that will not alter the fact that the defendant was negligent in honouring exhibits “2”, “3” and “4” which did not carry a valid signature of the plaintiff as per exhibit “1”. c Appeal allowed.

Cases referred to in the judgment Nigerian d ACB Plc v Haston (Nig) Ltd (1997) 8 NWLR (Part 515) 110 Adelaja v Alade (1999) 6 NWLR (Part 608) 544 Akinloye v Eyiyola (1968) NMLR 92 e Akinola v Oluwo (1962) 1 SCNLR 352 Duriminiya v Commissioner of Police (1961) NLR 70 Elias v Omo-Bare (1982) 1 All NLR 70 f Ezeonwu v Onyechi (1996) 3 NWLR (Part 438) 499 Ikenye v Ofune (1985) 2 NWLR (Part 5) 1 Ikoku v Oli (1962) 1 SCNLR 307 Jobi v Oshilaja (1963) 1 SCNLR 31 g Nwobodo v Onoh (1984) 1 SCNLR 1 Omoboriowo v Ajasin (1984) 1 SCNLR 108 Wilcox v Queen (1961) 2 SCNLR 296 h

Foreign Arab Bank v Ross (1952) QBD 216 Catlin v Cyprus Finance Corporation (London) Ltd (1983) 1 i All ER 809

Nigerian statute referred to in the judgment Bills of Exchange Act, 1882, section 24 j

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Ndoma-Egba v African Continental Bank Plc 149 a Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, sections 108(1), 137(1) and 138(1) b Foreign statute referred to in the judgment Partnership Act, 1890, sections 5, 10 and 15

Book referred to in the judgment c Paget’s Law of Banking (8ed) page 474 Counsel For the appellant: Okwusogu d Respondent absent and unrepresented

Judgment OGUNTADE JSC: (Delivering the lead judgment) The e appellant was the plaintiff at the Calabar High Court of Cross-River State. He brought the suit for and on behalf of Ndoma Egba, Ebiri & Co. (hereinafter referred to as “the Law firm”). He claimed against the respondent as the f defendant for the following:– “(i) The sum of N331,000.00 unlawfully withdrawn from the plaintiff’s Current Account No. 05756 as a result of the defendant’s negligence and collusion. g (ii) Interest on the principal sum calculated at the rate of 52% from the date of withdrawal until judgment. (iii) N5 million (Five Million Naira) being general damages for breach of contract, negligence for breach of contract, negligence and loss of reputation.” h The parties filed and exchanged pleadings after which the suit was heard by Ita J. In a reserved judgment on 22/9/98, the trial Judge awarded to the plaintiff the sum of N331,000 being the amount alleged to have been unlawfully i withdrawn from the account of the law firm and a further sum of N502,000 as general damages. Dissatisfied with the said judgment, the defendant brought an appeal against it before the Court of Appeal, Calabar Division (hereinafter j referred to as the “court below”). The court below in its

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 150 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) judgment on 11/4/2000, allowed the appeal. It set aside the a award made by the trial court and dismissed the plaintiff’s suit. The plaintiff has brought before us an appeal against the judgment of the court below. In the appellant’s brief b filed by plaintiff’s counsel, the issues for determination in the appeal were identified as the following:– “1. Were their Lordships right in holding that the appellant did not prove that P.W.1’s signature on exhibits 2, 3 and 4 were c forged? 2. Were their Lordships right in holding that the appellant as plaintiff were (sic) estopped from raising the issue of forgery? 3. Were the withdrawals from the appellant’s account lawful d and was the award of damages by the trial court justified?” The respondent formulated its own set of issues for determination. A comparison of respondents issues with the appellant’s shows that in substance both sets are similar. I e shall be guided in this judgment by the appellant’s issues. I intend to consider each of the issues serially. It is necessary that I expose briefly the facts giving rise to the dispute out of which this appeal arose as pleaded by the parties. f The plaintiff was the senior partner in a law firm registered as Ndoma Egba, Ebiri and Company. The law firm had a registered office at Calabar. It maintained a current account No. 0576 with the defendant, bankers, at the g defendant’s branch situate at Calabar Road, Calabar. It was a “clients account”. In order to operate the account, the law firm filed with the defendant a mandate, which indicated that the cheques and instruments of the law firm to be valid, h ought to be jointly signed by the two legal practitioners in the law firm that is the plaintiff Victor Ndoma Egba and Richard David Ebiri. A card showing the specimen signatures of the two legal practitioners was filled and left i with the defendant. The law firm later paid a cheque for N500,000 into its account with the defendant. The cheque had been received for a client of the law firm Messrs. Reynold Construction j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 151 a Company Ltd (hereinafter referred to as RCC). RCC later instructed the law firm to pay a part of the N500,000 to its sister company called NWRD. The law firm issued the b cheque on 12/3/93. On 30/3/93 plaintiff called at the defendant’s branch to ascertain if the cheque issued had been paid. He was however informed that although the said cheque for N375,000 had not yet been presented the law c firm had only N2,000 in its account. Upon further enquiry, the plaintiff discovered that three different cheques for N225,000, N31,000 and N75,000 had been paid out of the account on 1/3/93, 1/3/93 and 12/3/93 respectively. These came to a total sum of N331,000. The cheques for N31,000 d and N75,000 had been paid to one Oluwaseyi Fabelurin and the one for N225,000 to the defendant. The plaintiff pleaded that the defendant had been e negligent by not observing the instructions left with it on the mandate card as to who could validly sign cheques and instruments on behalf of the law firm. The cheque, issued by the law firm to NWRD was dishonoured by the defendant on its presentment. Embarrassed, the plaintiff by its letters f wrote to the defendant to demand a refund or restitution. The defendant denied liability. The plaintiff therefore sued as earlier stated above. g The defendant denied plaintiff’s claim. It pleaded that on 1/3/93, Mr Richard D Ebiri wrote to the defendant requesting for a bank draft for N225,000 in favour of a stated company. The law firm’s cheque for N225,000 was annexed to the letter. The other withdrawals of N31,000 and h N75,000 were made by the law firm’s accountant Oluwaseyi A Fabelurin who had hitherto made huge withdrawals on the law firm’s behalf. The plaintiff had introduced the accountant to the defendant and the defendant had in good i faith dealt with him. The cheques against which the three payments were made had carried signatures, which were regular on their face. The signatures on the cheques were those of the plaintiff and Mr Richard Ebiri. Mr Richard Ebiri j had not complained that his signature was forged. The

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 152 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) defendant pleaded that the plaintiff had been negligent or a contributorily negligent. The trial Judge heard the case on this state of pleadings. The plaintiff testified as PW1 and his partner Richard David b Ebiri as PW2. The plaintiff maintained as he pleaded that the signature ascribed to him in the cheques with which the sum of N331,000 was withdrawn from the account of the law firm was not his own, and not in accordance with the c mandate given to the defendant vide exhibit “1”. The photocopies of the cheques with which the total sum of N331,000 was withdrawn were tendered as exhibits “2”, “3” and “4”. Plaintiff however agreed that the signature of his d partner Mr Richard Ebiri was on exhibits “2”, “3” and “4”. In his evidence the plaintiff who testified as P.W.1 said:– “Mr. Ebiri was not in charge of the general management of the partnership. I am the head of the firm and senior partner. Mr. Ebiri e is a partner. It is not true that we do not work in concert with my partner. It is the oldest surviving partnership in Calabar and has grown from strength to strength in spite of A.C.B. Ltd. Our mandate to the defendant is that all cheques must be signed by both of us, not either of us. All instructions to the bank also must f be signed by both of us. My partner’s signature in exhibits 3 and 4 were not forged. The documents shown to me appear to be the original copies of exhibits 3 and 4. I had a partnership accountant by name Oluwaseyi Fabelurin. His g duty was to keep the books whether or not we were around. It will include handling banking transactions but will exclude signing my signature. The cheque book and stubs are kept in the Accounts Department under the care of the Accountant. He takes care of everything in the Accounts Department. h No, it is not true that as at date of commencement of this suit, all bank statements had been duly delivered to the partnership. Exhibits 2, 3 and 4 were obviously and patently, forged. My signatures there bore no resemblance whatsoever to mine. It i should have been obvious to every person. The signatures on exhibits “2”, “3” and “4” are definitely not mine. They are not in the least similar to my signature on exhibit “1”. It is like comparing a car and a bicycle. There is no resemblance at all. I am entitled to my claims in the suit.” (Italics mine.) j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 153 a PW2’s evidence on pages 128 – 129 of the record is brief. I produce it in full:– “I know P.W.1 and that he brings this action by authority of the b law firm of Ndoma Egba, Ebiri & Co., in his capacity as senior partner. I know the defendant as a company that has been bankers to our law firm. The law firm has an account with the defendant opened by way of dual mandate signatures to have been effected always by Victor Ndoma Egba and myself. I have seen exhibits 1, c 2, 3 and 4. The signatures on the mandate card (exhibit D and those on exhibits 2, 3 and 4) are mine. Yes, I am familiar with the signature of P.W.1. The signature of P.W. 1 is on exhibit I. Those on exhibit 2, 3 and 4 are definitely not his signature. Yes I made d exhibit 16. Cross-examination By Mrs. Akobune, Yes I said I signed exhibit 16. I am aware that the defendant complied with exhibit 16. I am not aware whether the obligation to e the Federal Superphosphate Fertilizer Company was met. I am convinced that PW1’s signature in exhibit 1 is not the same as that in exhibits 2, 3 and 4. We had an Accountant by name O. Fabelurin. In the absence of PW.1 I run the firm on my own not in conjunction with the accountant. I and P.W.1 jointly run the firm’s f banking transaction. The accountant only carries out accounting transactions. I and P.W.1 alone carry out banking transactions. Yes all cheques issued by the firm may be signed by me and P.W.1.” The remarkable thing about the evidence of PW1 and PW2 g is that neither of them explained the procedure followed in drawing out money from the bank and how the cheques exhibits “2”, “3” and “4” came to be signed by PW2 and not signed by the plaintiff. Strangely too the defence Counsel h under his cross-examination did not attempt to elicit from PW1 and PW2 evidence on these points. The defendant called one witness. He testifies as DW1. In his evidence under cross-examination at pages 138 – 139 of i the record, DW1 said:– “I have seen exhibit 1 (plaintiffs asked to read it out in full by counsel) The name of the account in our books is Ndoma Egba, Ebiri & Co. I seen (sic) on exhibit 1 that ‘both must sign’ but it is j not their instruction to the defendant, it is for our office use. The

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signatures were not put on the mandate card by the defendant. a They were put by the signatories, Victor Ndoma-Egba and Richard Ebiri. In further answer, mandates are given through resolution of a Registered Company. Where a respondent is absent the bank will now insist on all the signatures in the signatory card signing. So, b signature does not bear the mandate. Rather, I now say that the account holder do not give mandate in the signature card. Yes, I told the Court that in exhibit 1, the resolution column was nil. In order (sic) words therefore, all the signatories on exhibit I must c sign. In orders (sic) words, the mandate on exhibit 1 is that Richard Ebiri & Victor Ndoma Egba must sign together. I still maintain my previous statement that the defendant is not a Banker to Ndoma Egba, Ebiri & Co. as a registered company, but a joint account. Yes, I brought exhibit 16. The heading is Ndoma Egba, d Ebiri & Co. No. I did not take instructions from a partnership that does not exist in exhibit 16. Exhibit 16 was signed by Richard Ebiri alone, even though told the court that both signatures (sic) must sign.” e The trial Judge in his judgment at pages 163 – 166 of the record made findings of fact thus:– “1. Both parties agree that the specimen signature of P.W. 1 is the true, genuine, regular and acceptable one. I take it as f agreed that it is therefore the basis or reference point for comparing and determining any other signature in dispute between the parties. 2. I have perused the signatures on exhibit 1 and that attached g to exhibit 14 and I find them similar in all material particulars and characteristics. 3. I have also compared by way of examination the signature on exhibit 1 on one hand, and those on exhibits 2, 3 and 4 on the other hand and I clearly find the following obvious and h material differences, namely– (a) The general impression of that on exhibit 1 is that of a normal, free signature whilst that on exhibit 2, 3 and 4 are those of a copied or printed effort. i (b) The writing in one gives the impression of a fast smooth and minute one whilst the others are that of a laborious pains taking, calculated, premeditated one and are obviously larger. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 155 a (c) In the 1st the stroke connecting ‘N’ and ‘D’ is slanting and obvious. In the others it is horizontal or absent entirely. b (d) In the 1st the longline or stroke under the signature is straight and clearly extends beyond the last alphabet (a). In the others it ends abruptly with the ‘a’. (e) In the 1st the last word ‘a’ is itself long and extensive. In the others it has no line to it and ends sharply and c abruptly with the ‘a’. (f) In the 1st the ‘E’ of Egba appears like a big ‘q’ and the proceeding ‘a’ connects it with 4 line (sic) at the upperside. In the others the connection is at the d bottomside and it looks like an ‘E’ instead of ‘o’. (g) In the 1st the ‘g’ of Egba below the long line is preceded by 2 dots in the other sit is between the 2 dots. (h) In the 1st the character of the alphabets are smallest, e sedate, smooth and uniform. In the others they are abrupt, noisy’, obvious loud and clear. 4. The plaintiff in paragraph 9 of the amended statement of claim pleaded and sought to rely at the trial on the report of an handwriting (sic) expert. Ref. No. DXX/21/93 dated f 4/5/93 and the police report on the fraud. But the defendant in paragraph 15 of the amended statement of defence stated that it would object to the tendering of the two reports at the trial. I take it that the defendant did not g want the said reports to be tendered at all. I further take it that it is not open to them to approbate and reprobate. 5. The signatures on exhibits 2, 3 and 4 were not made or authorised by P.W.1, and he never ratified or adopted or h condoned them at all throughout and till date. 6. The said signatures were clearly made without his consent or knowledge, and to the material detriment and loss of the plaintiff’s firm. On the question of negligence etc– i 1. That the defendant returned the cheque for N375,000 00 attached to exhibit 14 unpaid, because the account was no more in funds as stated by Mr. Omenye, their Manager. 2. That the defendant declined or refused to call any of its j officers who has direct and personal knowledge relating to

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the unauthorised withdrawal in exhibits 2, 3 and 4 because it a would be adverse to their interest to do so. 3. That the defendants ought to have been put on notice that payment of exhibits 2, 3 and 4 is irregular because of the irregular signatures of P.W.1 thereon, the huge amounts b withdrawn within a short period of time, and all the surrounding circumstances of this particular case. 4. That neither the Branch Manager, the verifying officer or the pay officer was called so (sic) establish good faith, due care c or lack of negligence or collusion in the payments complained of especially as the purported signatures of P.W.1 on exhibits 2, 3 and 4 were so self evidently dissimilar or irregular as compared to that in exhibit I in their custody, and intended for the very purposes of comparison. That the d unauthorised withdrawals could have been aborted had the defendants’ officers taken or made even minimal due care and enquiry. That the wrongful dishonour of the cheque attached to exhibit II by the defendant is a direct and e foreseeable consequence of the defendant’s negligence in wrongfully paying out in exhibits 2, 3 and 4, in clear breach of their contractual obligation in exhibit I, not to honour cheques that are not duly signed or issued by both partners i.e. and P.W.2.” f The court below reversed the judgment of the trial court on three grounds. The first was that – as the plaintiff had pleaded that his signature was forged, he bore the burden of proving that allegation beyond reasonable doubt. It held that g as the plaintiff did not call handwriting experts to show that his signature was forged on exhibits “2”, “3” and “4”, he ought not have succeeded. Secondly, the court below, held that since PW2 a partner in the law firm was shown to have h written a letter exhibit “16” authorising that the cheque exhibit “2” be paid, the plaintiff was estopped from contending that any of exhibits “2”, “3” and “4” was forged. Reliance was placed on sections 5, 10 and 15 of the Partnership Act, 1890 of England. Thirdly, that as it was i shown that the fraudulent withdrawals were indeed authorised, the plaintiff had failed to establish that the cheque for N375,000 it issued to its client was wrongfully dishonoured. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 157 a Was the court below right in its views that the plaintiff/ appellant did not show that exhibits “2”, “3” and “4” were forged? At page 258 of its judgment the court below said:– b “Where a party denies making a document which he is alleged to have executed or thumb printed, such denial is tantamount to saying that the document is a forgery or fake. In such a situation, the burden of proof of the forgery rests on the party who alleges, since forgery is a crime, the onus of proof on him who alleges is c proof beyond reasonable doubt; Ikoku v Oli (1962) 1 S.C.N.L.R. 307, Adelaja v Alade (1999) 6 NWLR (Pt. 608) 544 at 557 to 558.” In coming to the conclusion that the trial Judge erroneously d took it upon himself to compare the signature on exhibits “2”, “3” and “4” (the cheques with which withdrawals were made) with that on exhibit “1” (specimen signatures of PW1 and PW2), the court below said:– e “It cannot be disputed that a Judge has the power to make comparison of signatures or writings independent of an expert evidence. But he has some limitations on the matter beyond which he cannot go. Where the comparison is not very obvious but involves matters which are in the competence of an expert, it will f not be proper for the judge to constitute himself an expert and proceed to form his own opinion on a handwriting in the issue– Udekeson Ent. Ltd. v Okafor FCA/B/1103/78 of 13/8/9 . . . From the above extract, it cannot be gainsaid that the trial Judge had not assumed the role of an expert indetermining whether the disputed g signature in question was forged. This, he is not permitted to do, he not being a witness nor a handwriting expert”. In his appellant’s brief, Counsel submitted that on the undisputed evidence before the trial court, there was no h doubt that only the two partners in the law firm could validly sign cheques and instruments on behalf of the firm. Further, that there was evidence from both the plaintiff and PW2 that the signature of the plaintiff on exhibits “2”, “3” and “4” i was forged. As against this evidence, the only defence witness offered a mere denial. It was submitted that the trial judge who saw the witnesses testify was entitled to make his findings on the matter in view of section 108(1) of the j Evidence Act. Counsel relied on The Queen v Wilcox (1961)

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2 NSCC 274, (1961) 2 SCNLR 296; Jobi v Oshilaja (1961) a 1 SCNLR 31; (1963) 1 All NLR 12; (1963) NSCC Vol. 3 and 5. Counsel said that it was obvious that the court below had not itself examined the handwritings before it rejected b the findings of the trial Judge. He submitted that this Court could itself make the comparison. Respondent’s Counsel submitted that the plaintiff had pleaded in its statement of claim that it would rely on the c evidence of a handwriting expert in proof of the fact that the signatures on exhibits “2”, “3” and “4” were forged. As it had so pleaded, the plaintiff could not rely on oral testimony to prove facts contained in a written record Elias v Omo- d Bare (1982) 1 All NLR 70; ACB Plc v Haston (Nig) Ltd (1997) 8 NWLR (Part 515) 110 at 131. Counsel argued that since an expert was not called to testify, section 149(d) of the Evidence Act should have been invoked. Counsel relied e on Ezeonwu v Onyechi (1996) 3 NWLR (Part 438) 499 at 528; Ikenye v Ofune (1985) 2 NWLR (Part 5) 1; (1985) 4 SC (Part 1) 8 at 22. Now in paragraph 9 of its amended statement of claim, f the plaintiff pleaded:– “9. The plaintiff then demanded for all the cheques upon which these withdrawals were made. An inspection of the cheques produced by the defendant revealed that all the withdrawals were made with cheques bearing forged signatures. All the g cheques (except the cheque of 1/3/93 for N225,000.00) were made payable to one Oluwaseyi Fabelurin an Accountant employed by the plaintiff, while the cheque for N225,000.00 was made payable to the defendant. The defendant is hereby h put on notice to produce all the cheques pleaded in paragraph 8 above or their copies at the trial. At the trial of this case, the plaintiff shall also rely on the report of an (sic) handwriting expert Reference No. DXX/21/93 dated 4 May, 1993 and the police report on the fraud.” i The defendant in paragraphs 11 and 17 of its amended statement of defence pleaded:– “11. Still in further denial of the said paragraph 8 of the plaintiff’s amended statement of claims the defendant says that the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 159 a sums of N31, 000.00 and N75.000.00 were authorised withdrawals made by the plaintiff to his accountant Fabelurin A. Oluwaseyi who has been making huge withdrawals for the plaintiff for many years. Besides, the plaintiff is silent on b the signature of his partner who also signs the partnership account cheques with him. The defendants say that the total sum of N331,000.00 (Three Hundred and Thirty-one Thousand Naira) allegedly withdrawn from the plaintiff’s c law firm Account No. 05756 was duly authorised by the plaintiff by his conduct. 17. In further answer to the said paragraph 10, the defendant avers that– d (i) the signatures on the cheques alleged by the plaintiff to be fraudulent, which is denied, were those of the plaintiff and resembled the approved signatures supplied by the plaintiff and his partner on the specimen signature card, e (ii) at the trial the defendant will contend that the plaintiff’s signature on the cheque were those of the plaintiff’s and his partner who has not complained of his signature being forged and he is not a party to this f action; (iii) the defendant denies that the signatures were not those of the plaintiff and his partner and the withdrawals complained of were made by the plaintiff and his g partner on cheques regularly signed by them and issued to Mr. Oluwaseyi Fabelurin, an accountant, employed by the plaintiff who was entrusted to handle the accounts and finances of the plaintiff(s). h (iv) paragraph 10 (iii) is specifically denied. The plaintiff is being mischievous in his allegation. The withdrawal of the sum of N225,000.00 (Two Hundred and Twenty-five Thousand Naira) was authorised by the plaintiff’s partner in his letter to the defendant dated i 1 March, 1993, requesting for a Bank draft to be issued in favour of Federal Super Phosphate Fertilizer Company Ltd, Kaduna, which request was duly complied with. The letter of 1 March, 1993, which was accompanied by a cheque No. 388684 duly j authorised by both partners is hereby pleaded The

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(sic) said amount was paid by bank draft and not a across the counter as alleged.” The case put before the trial court by the plaintiff deserves to be meticulously and reflectively analysed in order to b determine whether he had set out to establish the commission of a crime by anybody such as would impose on him the necessity to establish a case of forgery beyond reasonable doubt. The case of the plaintiff was that when the c law firm opened an account with the defendant it was given a mandate form to fill so that those who could validly sign cheques for the law firm might be identified. Exhibit “I” was that mandate form. Exhibit “I” shows that the two partners d Victor Ndoma-Egba and Richard David Ebiri must jointly sign a cheque to be valid. The cheques which were issued to draw out total sum of N331,000 were tendered as exhibits “2”, “3” and “4”. PW2, Richard Ebiri acknowledged that he e signed each of exhibits “2”, “3” and “4”. Plaintiff however said that he did not sign any of them. PW2 also stated that the signatures ascribed to plaintiff on exhibits “2”, “3” and “4” did not belong to him. The sum total of the forgery involved here viewed from plaintiff’s angle was that f plaintiff did not sign exhibits “2”, “3” and “4”. It was never the case of the plaintiff that any named person had actually forged exhibits “2”, “3” and “4”. The plank of the plaintiff’s case was that he did not sign the cheques. On the other g hand, the defendant in paragraphs 11 and 17 reproduced above pleaded that it was the plaintiff who signed the signatures ascribed to him on exhibits “2”, “3” and “4”. Indeed, the defendant could have escaped liability for h plaintiff’s claim only if it established that it was the plaintiff and not any one else who signed exhibits “2”, “3” and “4”. It is therefore apparent that it was the defendant and not the plaintiff who bore the burden of establishing that it was the i plaintiff and not anyone else who signed exhibits “2”, “3” and “4”. In Nwobodo v Onoh (1984) All NLR 1 at 77, (1984) 1 SCNLR 1 at 72 Obaseki, JSC discussed the nature of the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 161 a offence of forgery and the proof of it in relation to section 137(1) of the Evidence Act thus:– “Forgery as defined under the Criminal Code reads– b Section 465 A person who makes a false document or writing knowing it to be false, and with intent that it may in any way be used or acted upon as genuine, whether in Nigeria or elsewhere to the prejudice of any person or with intent that any person may be in the c belief that it is genuine be induced to do, or refrain from doing any act whether in Nigeria or elsewhere is said to forge the document or writing.” To bring an indictment for the offence of forgery under d section 465 of the Criminal Code, it must contain the important ingredient of knowledge except the word “forgery” is used in the indictment. The whole essence of an examination of the pleading for e the purpose of determining whether it alleges a criminal offence or not is brought about by section 138(1) of the Evidence Act. The sub-section provides:– “If the commission of a crime by a party to any proceeding is f directly in issue in any proceeding civil or criminal, it must be proved beyond reasonable doubt.” It amounts to this therefore:– g (1) that the allegation must be made to a party to the case; and (2) that the commission of the crime shall be directly in issue, or in other words, that it is the commission of h the crime that must be proved before the plaintiff or the petitioner (as in this case) could succeed in his action. If this were the case, then the allegation which constitutes i the crime must be proved beyond reasonable doubt as if it were a criminal case that was on and not on the balance of probabilities. It is plainly the case that the plaintiff had not made the j allegation that it was the defendant who forged the signature

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 162 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) of the plaintiff on exhibits “2”, “3” and “4”. The plaintiff’s a case as conceived and put across would succeed, as it did, if he succeeded in showing that he did not sign the signature ascribed to him in exhibits “2”, “3” and “4”. The use of the b word “forge” in the context of this case cannot be equated with the use of the same word as “forgery” in a criminal offence. “Forge” in this case has a secondary connotation and it means no more than that the plaintiff did not sign the c cheques exhibits “2”, “3” and “4”. Section 138(1) would apply only where the commission of a crime is imputed to a person in a civil trial. As the plaintiff was not saying that a particular person had forged his signature, he did not bear the burden of establishing the case on a standard beyond d reasonable doubt. In Omoboriowo v Ajasin (1984) All NLR 105 at 110; (1984) 1 SCNLR 108, this court per Bello, JSC (as he then was) drew a distinction between a case where it is necessary e to prove the allegation of crime beyond reasonable doubt and another where such allegation even if made does not form the bedrock of the case as to entail the necessity to prove it beyond reasonable doubt. The learned JSC said:– f “Again, in my reasons for judgment in Nwobodo v Onoh (Supra), I considered fully the scope of Section 137(1) of the Evidence Act and its application to the pleadings of a particular case as qualified by the principle of severance of pleadings as demonstrated in g Nwankwere v Adewunmi (1967) N.M.L.R. 45 at 48 and Arab Bank v Ross (1952) 2 Q.B. 216 at 229. In the case on hand, at the close of his case during the hearing of the petition, the petitioner abandoned the allegations of crimes. It follows therefore that in so far as the petition was founded on h those allegations, it must be dismissed. However, if the averments alleging crimes against the 2nd respondent were excised from the petition there still remained in the body of the petition sufficient averments without putting directly in issue the commission of a crime by a party to sustain the petition.” (Italics mine.) i In Arab Bank Ltd v Ross (supra) at page 229, Lord Denning, MR said:– “Under the rules of pleading, as I have always understood them, a pleader, who has pleaded more than he strictly need have done, j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 163 a can always disregard the unnecessary or surplus averments and rely simply on the more limited ones.” Even if it is argued that the plaintiff had pleaded “forgery” b in the sense postulated under section 137(1) of the Evidence Act, it cannot escape notice that in paragraph 17 (iii) and (iv) of the amended statement of claim, the plaintiff had pleaded thus:– c “(iii) The defendant is in breach of her duty to the plaintiff in purporting to act on the alleged instructions of one signatory to the account when the plaintiff’s mandate to the defendant was joint, that is, between Victor Ndoma-Egba and Richard D. Ebiri acting together. d (iv) The defendant is in breach of her duty of care and negligence to the plaintiff.” The above two averments wherein the word “forge” was not e employed, fully captures the nature and essence of plaintiff’s case. Guided by this, one sees readily that the reference made in some paragraphs of the amended statement of claim to fraud and forgery amounted to unnecessary and surplus averments which did not in a juridical sense, add any value f to the plaintiff’s case. The court below was of the view that the trial court ought to have held the plaintiff to the standard of proof prescribed under section 137(1) of the Evidence Act. I think, with respect to their Lordships of the court g below that they were wrong to have imposed that extra burden on the plaintiff. It is my respectful view that in order to succeed, the plaintiff only needed to show that the defendant did not abide by the terms of the mandate given it h vide exhibit “1” as to who could validly sign cheques and bank instruments on behalf of the plaintiff. In coming to the conclusion that the plaintiff’s signatures on exhibits “2”, “3” and “4” were different from the i specimen signature on exhibit “1”, the trial judge compared the disputed signatures on exhibits “2”, “3” and “4” with that on exhibit “1”. He then made extensive findings of fact to the effect that the signatures of the plaintiff on exhibits j “2”, “3” and “4” differed from the specimen signature of the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 164 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) plaintiff in exhibit “1”. However the court below took the a view that the trial Judge had by doing so turned himself into an expert. Section 108(1) of the Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 provides:– b “108 (1) In order to ascertain whether a signature, writing seal or finger impression is that of the person by whom it purports to have been written or made, any signature, writing, seal or finger impression admitted or proved to the satisfaction of the court to have been written or c made by that person may be compared with the one which is to be proved although that signature, writing, seal or finger impression has not been produced or proved for any other purpose.” d In Wilcox v Queen (1961) 2 SCNLR 296, De-Lestang CJ, Federal Supreme Court of Nigeria observed:– “It is not unusual for the courts in a clear case to form their own opinion as to handwriting and in R v Smith 3 Cr. App. R.87 as well e as in Rex v Rickard upon which Mr. David relies, the Court of Criminal Appeal in England formed its own opinion by comparing the handwriting alleged to be that of the appellant with a genuine specimen of his handwriting. So also did the West African Court of Appeal in R v Apena 13 W.A.C.A. 173. In the present case, the f dissimilarities between the signatures on the cheque and the genuine signatures of Nwobu are apparent to the naked eye and in our view, the course pursued by the learned Judge was not improper in the circumstances.” g The court below was in error to have concluded that the trial Court could not on its own compare plaintiff’s specimen signature on exhibit “1” with the disputed signatures on exhibits “2”, “3” and “4”. There is no doubt however that h the procedure adopted by the trial judge is wrong. Having identified the dissimilarities between the signature of the plaintiff on exhibit “1” and the signatures on exhibits “2”, “3” and “4”, the trial judge should have read to the parties in court his observations as to the dissimilarities and called for i the reactions of parties on such observations. In Duriminiya v Commissioner of Police (1961) NLR 70, the Court said:– “A trial is not an investigation, and investigation is not the function of a court. A trial is the public demonstration and testing j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 165 a before a court of the cases of the contending parties. The demonstration is by assertion and evidence, and the testing is by cross examination and argument. The function of a court is to decide between the parties on the basis of what has been so b demonstrated and tested. What was demonstrated in court at the trial failed to support the prosecution case and this magistrate should have dismissed the case. It was not part of his duty to do cloistered justice by making an inquiry into the case outside court c not even by the examination of documents which were in evidence, when the documents had not been examined in court and the Magistrate’s examination disclosed things that had not been brought out and exposed to test in court, or were not things that, at least must have been noticed in court.” (Italics mine.) d The findings made by the trial court upon a comparison of the plaintiff’s signatures on exhibits “1” and exhibits “2”, “3” and “4” must therefore be discountenanced. But that is not the end of the matter. As I observed earlier, plaintiff e denied that he signed exhibits “2”, “3” and “4”. PW2, the partner of the plaintiff who was familiar with the signature of the plaintiff confirmed that the signatures of exhibits “2”, “3” and “4” ascribed to plaintiff were not his. The only f defence witness gave the evidence on the point. He said:– “I have seen exhibits 3 and 4. The plaintiff’s signature on them are not, forged. They bear the same features and characteristics as the g signature card which is exhibit 1. Also since P.W.2 (Mr. Ebiri) admitted his own signature on exhibits 3 and 4, we are entitled to pay to the payee (Oluwaseyi Fabelurin) who is the accountant to the partnership. I have seen exhibit 2 and I maintain that the signatures of the h plaintiff bear the same features and characteristics. By the plaintiff I mean P.W.1 on record.” There were thus two versions of the evidence before the trial judge. The version given by plaintiff and PW2 needed to be i compared with that given by DW1. This was a civil case and the trial Judge had the duty to decide which of the two versions of the evidence to accept. He accepted the version of the plaintiff. It was not open to the court below to reverse j such findings of fact. See Akinola v Oluwo (1962) All NLR

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224; (1962) 1 SCNLR 352 and Akinloye v Eyiyola (1996) a NMLR 92. I am satisfied therefore that the trial court was right to have found that plaintiff did not sign the signatures on exhibits “2”, “3” and “4” which were ascribed to him. b Was the court below right in holding that the appellant was estopped from raising the issue of forgery? At pages 265–266 of the record, the court below in coming to the conclusion that the plaintiff/appellant was c estopped from denying that the acts of PW2 as an agent of the law firm were in the course of the business of the partnership. The court below said:– “In the face of the above two extracts it cannot be seriously d contended that the account in question is not a partnership account. It is immaterial that it was opened as a client’s account. I am dearly (sic) of the view that Sections 5, 10 and 15 of the Partnership Act, 1890 are applicable to the circumstances of the case. The sections provide–– e ‘Section 5– Every partner is an agent of the firm and his other partners for the purpose of the business of the partnership, and the acts of every partner who does any act for carrying on in the usual way business of f the kind by the firm of which he is a member bind the firm and his partners, unless the partner so acting, has in fact no authority, to act for the firm in the partnership matter, and the person with whom he is dealing either knows that he has no authority g or does not know or believe him to be a partner. Section 10– Whereby any wrongful act or omission of any partner acting in the ordinary course of the business of the firm, or with the authority of his co partners, loss or injury is caused to any person not being a h partner in the firm or any penalty is incurred, the firm is liable therefore to the same extent as the partner so acting or omitting to act. Section 15– An admission or representation made by any i partner concerning the partnership affairs and in the ordinary course of business is evidence against the firm.’ Applying the above provisions to the instant case, it seems clear to me that exhibit 16 and exhibit 2 being the acts of P.W.2 as agent j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 167 a of the partnership and the acts having been done in the ordinary course of business are binding on P.W.1 as well as on the partnership firm. b Since P.W.2 had signed exhibits 2, 3 and 4 and wrote exhibit 16, he had by his act induced the appellant bank to act on exhibits 2, 3, 4 and 16 and neither he nor P.W.1 nor the firm is permitted to set up P.W.2s own act to the prejudice of the appellant whom P.W.2 had misled. I resolve this issue in favour of appellant.” c I think that the court below completely misunderstood the purport of sections 5, 10 and 15 of the Partnership Act, 1890, England in relation to the ascertained facts of this case. The learned authors of Lindley on Partnership (14ed) d at page 254 discussing the general rules guiding the applicability of section 5 of the Partnership Act, 1890 write:– “The consequences of the general rule contained in Section 5 of e the Partnership Act, 1890 are– (1) That if an act is done by one partner on behalf of the firm and it was done for carrying on the partnership business in the ordinary way, the firm will prima facie he (sic) liable f although in point of fact the act was not authorised by the other partners. (2) That if an act is done by one partner on behalf of the firm, and it was not done for carrying on the partnership in the ordinary way, the firm will prima facie not be liable. g In the first case the firm will be liable unless the one partner had in fact no authority to bind the firm, and the person dealing with him either was aware of that want of authority or did not know or believe him to be a partner whilst in the h second case the firm will not be liable unless an authority to do the act in question, or some ratification of it, can be shown to have been conferred or made by the other partners.” i And at pages 302–303 of the same work the authors write:– “By Section 5 of the Partnership Act, 1890 every member of a partnership is declared to be the agent of the firm, so far as is necessary for the transaction of its business in the ordinary way and to this extent his authority to act for the firm may be assumed j by those who, knowing him to be a partner, have no knowledge of

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the real limits of his authority. If his authority has been restricted a to narrower limits, still the firm will be bound to all persons who, knowing or believing him to be a partner, deal with him bona fide without notice of the restriction, so long as he acts within the wider limits set by that section. On the other hand, if a person b seeks to fasten upon the firm liability in respect of some act of one of the members which does not fall within the limits of his authority as set by that section, a more extensive authority must be shown to have been actually conferred upon him by the other c partners, and if no sufficient authority can be shown, the firm will not be liable, even though the person seeking to charge it had no notice of the real authority possessed by the partner with whom he dealt.” d Notice of want of authority:– “The immateriality of notice of want of authority in the last case, and its materiality in the former, is a necessary consequence of the law of agency. A firm can only be made liable for what is done by one of its members on the supposition that the act in question was e authorised by the other members. Now, as by law they are held prima facie to authorise all acts done in carrying on the business of the firm in the usual way they cannot escape liability for any act of this character unless they can show that the apparent authority to f do it did not exist, and was known not to exist. But when it is sought to make the firm liable for some act not prima facie authorised by it, an actual authority by it must be shown; ignorant the person seeking to charge it may have been of what was authorised and what was not in the case now supposed the firm did g not mislead him; and if he was misled by the representations of the partner with whom he dealt, his remedy is against that partner; just as when an agent untruly represent (sic) his authority, a person dealing with him acquires no right against the principal, but must look to the agent for indemnity.” h It is undisputed, on the facts presented in this case, that the plaintiff in its mandate exhibit “1” left written instructions and notice with the defendant that its cheques must only be signed by the two partners jointly. Clearly therefore the i defendant had notice of the limit on the authority of PW2 to sign cheques or behalf of the partnership. Sections 5, 10 and 15 of the Partnership Act, 1890 only offer protection to an outsider dealing with a member of a partnership only to the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 169 a extent that the outsider is unaware of the limit of the authority of the partners with whom he is dealing. In the instant case, the defendant in the evidence of DW1 said at b page 138:– “I have seen exhibit 1 (plaintiffs asked to read out in full by counsel) the name of the account in our books is Ndoma Egba, Ebiri & Co. I see on exhibit 1 that ‘both must sign’ but it is not their instruction to the defendant it is for our office use.” c In coming to the conclusion that sections 5, 10 and 15 of the Partnership Act, 1890 estopped the plaintiff from claiming damages, the court below dwelt at length on the implications of exhibit “16” a letter written by PW2 to which was d annexed the cheque exhibit “2”. The letter exhibit “16” reads:– “Ndoma Egba Ebiri & Co., e Barristers at Law & Solicitors 31 March, 1993. The Manager, African Continental Bank Plc., f Calabar Road, Calabar. Dear Sir, Re– Bank Draft g Kindly issue a bank draft of N225,000.00 (Two Hundred and Twenty-Five Thousand Naira only) in favour of Federal Super Phosphate Fertilizer Company Ltd, Kaduna. Enclosed herewith is our bank cheque No.388684 in your favour. h Treat as urgent. Yours faithfully. For Ndoma Egba, Ebiri & Co. Sgd– Richard D. Ebri. i Partner”. PW2 agreed writing the above letter. But the defendant should not have honoured the letter and the cheque exhibit “2” for N225,000 annexed to it since both did not bear j the signature of the plaintiff as given in exhibit “1”. It is

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC 170 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) difficult to understand why the court below placed reliance a on exhibit “16” and sections 5, 10 and 15 of the Partnership Act, 1890 to conclude that the defendant, a banker could honour exhibit “2” without complying with the mandate b given it in exhibit “1”. An instructive case in this connection is Catlin v Cyprus Finance Corporation (London) Ltd [1983] 1 All ER 809 at 816 where the court said:– c “The defendants agreed to honour instructions signed by both account holders. This no doubt imported a negative duty nor to honour instructions not signed by both account holders. This duty also could, in theory, have been owed jointly, but must (to make d sense) have been owed to the account holders severally, because the only purpose of requiring two signatures was to obviate the possibility of independent action by one account holder to the detriment of the other. A duty on the defendants, which could only been (sic) forced jointly with the party against the possibility of e whose misconduct a safeguard, was sought, and where the occurrence of such misconduct through the negligent breach of mandate by the defendants would deprive the innocent party of any remedy, would in practical terms be worthless. Indeed, it would be worse than worthless, because a customer would f reasonably rely on the two signature safeguard and refrain from active supervision of the account, only to find when loss (allegedly irreparable) has resulted that the reliance was misplaced. The reality of this transaction was otherwise. Mrs. Catlin wanted, and thought she had obtained an undertaking from the bank that orders g for payment would not be honoured without her signature. I cannot conceive that the bank for its part did not intend to incur such an obligation to her (and also, mutatis mutandis, to Mr. Catlin). Had she raised the question at the out set I feel sure that they would h have assured her of the personal protection which she obtained from the mandate. The duty of complying with a simple mandate or pain of indemnifying the customer is not, after all something which is to a banker either unfamiliar or onerous.” When the plaintiff and PW2 jointly executed the mandate i form exhibit “1”, it must have dawned on the defendant that each wanted to protect himself from a situation where the other could unilaterally withdraw the partnership funds. The defendant therefore owed each of the two partners the duty j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 171 a not to allow either of them to draw funds from the partnership account without the concurrence of the other, which concurrence must be signified by the signature of that b other as stated in exhibit “1”. It amounts to making a nonsense of the purpose of giving the mandate exhibit “1” for the court below to rely on the Partnership Act, 1890 to create an escape route for the defendant in its obligations to c the partners. I am satisfied that the court below clearly misunderstood the import of sections 5, 10 and 15 of the Partnership Act, 1890. The defendant in paragraph 19 of its amended statement d of defence pleaded that the plaintiff had been himself negligent thus:– “19. Paragraph 11 of the plaintiff’s amended statement of claim is denied. The said matters complained of were wholly caused or contributed to by the negligence and recklessness of the e plaintiff. Particulars of Negligence (i) Failure to keep his cheque books securely safe. (ii) Failure to exercise due care and supervision over his f Accountant – Mr. Fabelurin A. Oluwaseyi. (iii) Failure to exercise due care, sufficient or any, checks and balances and/or supervision over his Accountant – Mr. Fabelurin A. Oluwaseyi– g (iv) Failure to adhere to the precautionary measures given to defendant’s customers including the plaintiff as contained in every cheque book issued to its customers. This (sic) precautionary measures as contained in the defendant’s cheque books are hereby h pleaded; (v) Signing blank cheques for his ‘Accountant’ and leaving him to fill in the amounts; (vi) Failure to have regular consultations with his partner i especially on matters touching the partnership account and money; (vii) Lack of diligence in the conduct of the partnership business; (viii) Insufficient knowledge of accounts and Business j management.”

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At the trial however, no evidence was called by the a defendant in proof of the facts pleaded on the negligence of the plaintiff. The plaintiff did not lead evidence to show how exhibits “2”, “3” and “4” came to be signed by PW2 alone b and not by himself. The learned authors of Pagets Law of Banking (8ed) at page 474 write– “No doubt many of the earlier cases speak of a banker being bound to know his customer’s signature and of its being ipso facto negligence if he is misled by a forgery but there can be no legal c obligation of the sort, the law does not compel or exact the impossible and as pointed out by Mathew J. in London and River Plate Bank v Bank of Liverpool (1896) 1 Q.B. 7, if the forgery is cleverly executed, the banker may not be able by any amount of d care to ascertain whether or not his customer’s signature is a forgery . . . As counter balancing estoppel, it should seem therefor to be a question of fact whether the banker by exercising a due amount of care should have detected his customer’s supposed signature to be e a forgery.” (Italics mine.) DW1 testified that the signatures on exhibits “2”, “3” and “4” were consistent with those on exhibits “1” and that the signatures bear similar features and characteristics. However f DW1 did not testify that he had been the defendant’s official who caused exhibits “2”, “3” and “4” to be honoured in the first place. There was therefore no evidence that the defendant’s official or clerk who honoured exhibits “2”, “3” g and “4” had first compared the signatures on them with those on the mandate card exhibit “1”. The evidence of DW1 on the point was his opinion. It is difficult to hold in the circumstances that the defendant had exercised a due h amount of care to ascertain if the signature ascribed to the plaintiff in exhibits “2”, “3” and “4” was in fact his signature as in exhibit “1”. It needs be said however that the basis of the liability ascribed to the defendant is in the tort of negligence. It is not i a case of absolute liability. The question is: Had the defendant exercised due care and diligence in the procedure it adopted in making payments on exhibits “2”, “3” and “4”? The degree of perfection achieved in the simulation of the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Oguntade JSC Ndoma-Egba v African Continental Bank Plc 173 a genuine signature of a customer may be so high that even the banker may not be able to discover it is a forgery. It is not therefore the law that when a banker pays money out b from a customer’s account or a cheque which he believes to be genuine but which turns out to be a forgery, the banker, is willy nilly liable. The basis of liability in such a case is the failure to exercise reasonable care and diligence to process this cheque before payment. If there is cogent evidence, c which the court accepts that the banking official before paying out money from a customer’s account on a forged cheque did all that is necessary to compare the signature on the cheque, which turns out to be forged with the specimen d signature of the customer in its possession, the basis of liability in negligence is displaced. In the instant case however, there was not a shred of evidence on the pre- payment formalities done by the defendant by the clerk or e official who paid, as to whether the signature of plaintiff on exhibits “2”, “3” and “4” was at any stage compared with the plaintiff’s specimen signature on exhibit “1”. In coming to the conclusion as to a banker’s negligence, it is always f important to look at the disputed signature and compare same with the authentic signature to discover if the dissimilarities are so obvious as to be easily discernible. And finally is the third issue, which queries whether the g withdrawals from the plaintiff’s account were lawful. I have discussed above the case of the plaintiff as to exhibit “1”. It was the case of the plaintiff that unless its cheques were jointly signed by the two partners – the plaintiff and PW2, h no payment should be made by the defendant from the plaintiff’s account. The evidence, which the trial court accepted was that exhibits “2”, “3” and “4” against which the defendant made payments were not signed by plaintiff in i accordance with the mandate exhibit “1”. The points of defence which the defendant canvassed in their amended statement of defence were:– (1) That one of plaintiff’s parties wrote to the defendants j to pay on exhibit “2”.

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(2) That the plaintiff authorised the payment on exhibits a “3” and “4” to its accountant Mr Fabelurin Oluwaseyi. (3) That the plaintiff had introduced his accountant Mr b Fabelurin A Oluwaseyi to the defendant. (4) That the signatures on exhibits “2”, “3” and “4” were those of the plaintiff’s partners. c (5) That the plaintiff had been itself negligent in the manner it handled its cheque book. At the conclusion of trial however, most of these points of defence had no evidence in support of them. d Even if one of plaintiff’s partners had written exhibit “16” to the defendant to pay N225,000 that did not confer on the defendant an authority to ignore the terms contained in the mandate exhibit “1”. The same may be said in relation to the e two payments made to plaintiff’s accountant vide exhibits “3” and “4”. There was also no evidence of the negligence of the plaintiff as pleaded. The attempt by the defendant to rely on estoppel ought not have succeeded before the court f below. Under section 24 of the Bills of Exchange Act, 1882, a forged or an unauthorised cheque is inoperative. It may well be that the defendant may have its remedies against PW2 who was shown to have signed exhibits “2”, “3”, “4” g and “16”, but that will not alter the fact that the defendant was negligent in honouring exhibits “2”, “3” and “4” which did not carry a valid signature of the plaintiff as per exhibit “1”. h In the final conclusion, this appeal succeeds. It is allowed. The judgment of the court below is set aside and the judgment of the trial court is restored. The plaintiff/appellant is entitled to costs in the court below and in this Court which i I fix at N5,000 and N10,000 respectively. KUTIGI JSC: I read in advance the judgment just delivered by my learned brother Oguntade JSC. I agree with his reasoning and conclusion to allow the appeal. It is really j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Kutigi JSC Ndoma-Egba v African Continental Bank Plc 175 a difficult to see how the defendant could have escaped liability in this case after the plaintiff has clearly established that the defendant had failed to abide by the terms of the b mandate (exhibit “1” in the proceedings) filed by the plaintiff with the defendant to the effect that the cheques and instruments of the plaintiff to be valid, ought to be jointly signed by the two legal practitioners in the firm, that is the c plaintiff Victor Ndoma-Egba and Richard David Ebiri. The breach was no doubt responsible for the loss of funds claimed herein. I accordingly allow the appeal, set aside the judgment of d the Court of Appeal and restore that of the trial High Court. I endorse the order for costs made in the said judgment.

ONU JSC: Having read before now the draft judgment of my learned brother Oguntade JSC I agree with him that e there is merit in this appeal which I accordingly allow for the reasons assigned therein. The plaintiff/appellant is entitled to costs in the court below and in this Court which I fix at N5,000 and N10.000 respectively. f KALGO JSC: I have had the opportunity of reading in draft the judgment just delivered by my learned brother Oguntade JSC and I am in full agreement with his reasoning and g conclusions reached therein. He has fully and clearly in my view, dealt with the main issues in controversy between the parties and I entirely agree with him that there is merit in the appeal. I accordingly allow it and set aside the decision of h the Court of Appeal delivered on 11 April, 2003, and restore that of the trial court. I award N10.000 costs to the appellant against the respondent.

PATS-ACHOLONU JSC: I have read in advance the i judgment of my learned brother Oguntade JSC and I broadly and generally agree with him. On the face of the appeal to unravel what really happened in order to determine on whom the onus of proof would rest it would at first appear to j be the appellant. On a closer examination of the proceedings

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF NIGERIA) Pats-Acholonu JSC 176 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) it becomes inevitable that the onus of proof to show that the a signature is that of the appellant lies on the respondent and not the appellant who had emphatically denied it. The respondent did not succeed in discharging the onus. b In the circumstances, the appeal succeeds and I abide by the orders in the leading judgment. Appeal allowed.

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International Trust Bank Plc v Kautal Hairu Company Ltd 177 a International Trust Bank Plc v Kautal Hairu Company Ltd b COURT OF APPEAL, KADUNA DIVISION BA’ABA, JEGA, KEKERE-EKUN, JJCA

Date of Judgment: 2 AUGUST, 2005 Suit No:. CA/K/22/99 c Banking – Interest – When claimable

Facts d The facts of this case as can be seen from the totality of the records presented before this Court inclusive of the filed briefs, are as follows:– By a writ of summons dated 18 July, 1997, the respondent e herein filed an action against the appellant under the undefended suit. No leave of court was sought nor obtained to issue, enter or place the writ of summons on the undefended list. The parties then engaged in f negotiating an out of court settlement but while these negotiations were on, the respondent pressed for judgment before the court and this the court acceded to on 26 August, 1997. In the course of the arguments on whether judgment on the undefended list should be g entered against the appellant, Counsel representing the appellant challenged the claim for interest and urged the court not to award that claim. The learned trial Judge failed to record or rule on the arguments of Counsel, but in h a ruling given on 24 November, 1997 upon an application by Counsel to the appellant that he corrects what he thought was a slip in the judgment of the lower court acknowledged that objection to award interest was indeed i raised but was neither recorded nor ruled upon by him for the reasons that he thought the parties will resolve that in their negotiations. The objections of Counsel to the appellant to the award of interest have not been heard and j determined one way or the other by the lower court.

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Held – a 1. For a claim of interest to properly exist for determination in a court of law, it must be stated in the endorsement of the claims to the writ of summons or in the statement of b claim, also the grounds upon which the claim of interest is based must be stated whether the claim is based on contract or statute. Consequently, before a person can succeed on a claim of interest, he must endorse the claim c on the writ and also plead facts which would show that he is entitled to such interest. In the instant case, the respondent having sued under the undefended list must state in the endorsement of the claims to writ of d summons or in the affidavit whether the claim of interest is based on contract or statute and the grounds upon which the claim is based. Per curiam e “In the appeal at hand, the respondent in his particulars of claim before the lower court merely claim against the appellant interest of 15% per annum on the sum of $120,000 American Dollars from the April, 1995 to the date of f Judgment. His suit is on the undefended list there is nothing in his Writ of Summons or in the affidavit before the court stating whether the claim of interest is based on contract or statute and the grounds upon which the claim is based. I have carefully perused the Writ of Summons and affidavit g evidence before the court as filed by the respondent there is nothing whatsoever showing or indicating the circumstances or grounds upon which the claim of 15% per annum on the $120,000 is based.” h 2. The law is that payment of interest on a debt must be strictly proved by evidence for a trial court will not infer payment of interest from alleged usage or custom unless such usage or custom is established by evidence. i 3. Interest will be payable where there is an express agreement to that effect and that such an agreement may be inferred from a course of dealing between the parties. In the instant case since neither the supporting affidavit j

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International Trust Bank Plc v Kautal Hairu Company Ltd 179 a to the writ nor the writ itself disclosed any agreement between the parties as the basis for the award of the interest, the award of the interest on the principal sum b cannot be sustained. 4. The respondent has not by his writ of summons or in his affidavit in support of his claim on the undefended list disclosed the grounds upon which he based his claim of c 15% interest per annum on the $120,000. Therefore his claim of 15% interest per annum on the said sum of $120,000 before the lower court is not sustainable. Appeal allowed in part. d Cases referred to in the judgment Nigerian Adigun v A-G, Oyo State (1987) 1 NWLR (Part 53) 678 e Akor and others v Abu (1988) 3 NWLR (Part 85) 696 Akpabuyo Local Government v Duke (2001) 7 NWLR (Part 713) 557 f Alfotrin Ltd v A-G, Federation (1996) 9 NWLR (Part 475) 634 Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) 422 Eriobona v Obiora (1999) 8 NWLR (Part 616) 622 g Fawehinmi Construction Co Ltd v Obafemi Awolowo University (1998) 6 NWLR (Part 553) 171 Himma Merchant Ltd v Aliyu (1994) 5 NWLR (Part 347) 667 h Jos Steel Rolling Co Ltd v Benestielli Nig Ltd (1995) 8 NWLR (Part 412) 201 Mikailu v The State (2001) 8 NWLR (Part 715) 469 i Okoro v Okoro and another (1998) 3 NWLR (Part 540) 65 Otpo v Sunmonu and others (1987) 2 NWLR (Part 58) 587 Saeby Jerstober Maskinfabrk A/S v Olaogun Enterprises Ltd (1999) 14 NWLR (Part 637) 128 j Shylion v Aseiw (1994) 6 NWLR (Part 353) 670

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Nigerian rules of court referred to in the judgment a High Court of Kano State (Civil Procedure) Rules, 1988, Order 23 rule 3(1), Order 23 rule 3(4), Order 23 rule 4 b Book referred to in the judgment Stroud’s Judicial Dictionary (4ed) Volume 2

Counsel c For the appellant: Offiong (with him Olawoyin and Fakoya) For the respondent: Sadik d Judgment JEGA JCA: (Delivering the lead judgment) This is an appeal against the judgment of the Kano High Court of Justice presided over by Honourable Justice Mohammed Umar e Alkali in Suit No. K/430/97 wherein he entered judgment on the undefended list against the appellant on 26 August, 1997 in the sum of $120,000 American Dollars plus 15% interest from 26 April, 1995 to 26 August, 1997 and thereafter f interest at 10% court rate from 26 August, 1997 until judgment debt is fully liquidated. The appellant is not satisfied with the judgment and has filed an appeal dated 30 September, 1999 after obtaining an extension of time from this Court on 29 September, 1999. There were two grounds g of appeal on the original Notice of Appeal. This Court on 22 April, 2002 granted leave to the appellant to amend its Notice of Appeal. The appellant has now filed and served the amended Notice of Appeal dated 25 Apri1, 2002 which h pursuant to the leave granted by this Court inter alia now includes an additional ground of appeal and raised a fresh issue to wit whether the lower court had the jurisdiction to hear and give judgment in this case as an undefended list i suit. The facts of this case as can be seen from the totality of the records presented before this Court inclusive of the filed briefs, are as follows:– By a Writ of Summons dated j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA International Trust Bank Plc v Kautal Hairu Company Ltd 181 a 18 July, 1997, the respondent herein filed an action against the appellant under the undefended suit. No leave of court was sought nor obtained to issue, enter or place the writ of b summons on the undefended list. The parties then engaged in negotiating an out of court settlement but while these negotiations were on, the respondent pressed for judgment before the court and this the court acceded to on 26 August, c 1997. In the course of the arguments on whether judgment on the undefended list should be entered against the appellant, Counsel representing the appellant challenged the claim for interest and urged the court not to award that d claim. The learned trial Judge failed to record or rule on the arguments of Counsel, but in a ruling given on 24 November, 1997 upon an application by Counsel to the appellant that he corrects what he thought was a slip in the judgment of the lower court acknowledged that objection to e award interest was indeed raised but was neither recorded nor ruled upon by him for the reasons that he thought the parties will resolve that in their negotiations. The objections of Counsel to the appellant to the award of interest have not f been heard and determined one way or the other by the lower court. Upon the three grounds of appeal as contained in the g amended Notice of Appeal filed by the appellant dated the 25 April, 2002, learned Counsel for the appellant formulated three issues for determination. The issues are:– “1. Whether the lower court was right in awarding interest of h 15% per annum on the sum of $120,000 American Dollars from the 26 April, 1995 to the 26 August, 1997 in favour of the respondent. 2. Whether the appellant was not denied a fair hearing on the issue of interest claimed by the respondent having regard to i the acknowledgment of the lower Court that it failed to record and rule on behalf of the appellant. 3. Whether the entire judgment on the undefended list including the award of interest made by the Judge was not a j nullity.”

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The respondent also formulated three issues for deter- a mination. The issues are stated thus:– “1. Whether the respondent is entitled to claim interest against the appellant on a call deposit account at the rate of 15% on b the sum of $120,000 US Dollars and whether the lower court was right in awarding the said interest. 2. Whether the appellant is entitled to be heard in an Undefended Suit procedure where the appellant failed and refused to file any paper after being served with the Writ of c Summons containing the claim of the Respondent against it. 3. Whether the appellant can now raise a Preliminary Objection at an appellate stage in an undefended suit proceeding.” When this appeal was heard on 10 May, 2005 learned d Counsel for the appellant Mr OEB Offiong adopted the appellant’s brief of argument which was deemed filed by an order of this Court on 21 May, 2002 and urged the Court to allow the appeal. e Learned Counsel for the respondent Mr RA Sadik adopted the respondent’s undated brief of argument filed pursuant to court order of extension of time dated 7 February, 2005 and urged the court to dismiss the appeal. f The issues formulated by the appellant and the respondent are not exactly dissimilar accordingly, the issues as formulated by the appellant would adequately disposed of this appeal. g Issue No. 1 – Whether the lower court was right in awarding interest of 15% on the sum of $120,000 American Dollars from 26 April, 1996 to 26 August, 1997 in favour of the respondent. h On this issue, the learned Counsel for the appellant submits that the learned trial Judge was wrong to have awarded interest of 15% per annum on the sum of $120,000 i to the respondent when the respondent had neither established a right to such interest nor did he make a sufficient endorsement of the claim for interest so as to raise the claim for determination neither was there any proof of how they came about the right to interest and the rate of j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA International Trust Bank Plc v Kautal Hairu Company Ltd 183 a interest. It is further submitted for the appellant that it is now well-settled that a claim of interest could only arise either (a) as a right or b (b) where there is a power conferred by statute to do so in the exercise of the court’s discretion. It is further the contention of the appellant that a claim of interest as of right arises where it is contemplated by the c agreement of the parties or under mercantile custom or under a principle of equity such as breach of a fiduciary relationship. Reference made to Ekwunife (Trading Under the Name and Style of Gonglobe Associates and Company) v d Wayne (West Africa) Ltd (1989) 5 NWLR (Part 122) 422 at 445; Himma Merchants Ltd v Aliyu (1994) 5 NWLR (Part 347) 667 at 676 G-H; Jos Steel Rolling Co Ltd v Bernestieli Nig Ltd (1995) 8 NWLR (Part 412) 201 at 208; Enahoro v e IBWA Ltd (1991) 1 NCLR 180. Learned Counsel for the appellant argues that even if interest is not claimed on the writ but facts are pleaded on the statement of claim and evidence is given which show f entitlement thereto, the court may if satisfied with the evidence award the claim of interest. That adjudication on the plaintiffs right to interest in such case is like any other issue in the case based on the evidence placed before the g court. The evidence called at the trial will in such a case establish the proper rate of interest and the date from which it should begin to run whether from the accrual of the cause of action or otherwise. Reference made to Saeby Jerstober Maskinfabrk A/S v Olaogun Enterprises Ltd (1999) 14 h NWLR (Part 637) 128 at 144 H–145 A–B; Akpaboyo Local Govt v GO Duke (Trading under the Name & Style of Giffobas Ventures) (2001) 7 NWLR (Part 713) 557 at 573 11–574 A–B. Counsel for the appellant urges us to uphold i its complaint under Issue 1 that the lower court erred in awarding the claim for interest to the respondent and to set aside the award and dismiss the claim. In reply to the submissions on Issue No. 1, learned Counsel j for the respondent submits that the nature of the contract

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA 184 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) between the appellant and the respondent herein was that of a banker/customer relationship where the respondent deposited its money in the sum of $120,000 US Dollars in a call deposit with the appellant. It is the contention of the b respondent’s counsel that once a customer makes a deposit in a call deposit account, the customer is entitled to interest on the said deposit. Submits that the appellant and the respondent were in agreement that the said deposit by the respondent was an investment with the appellant that this c was confirmed by Exhibits “KHL3” and “KHL4” attached to the claim of the respondent against the appellant before the lower court. Counsel further submits that the respondent was entitled to the interest claimed in this suit at the rate of d 15% which claim the appellant did not deny or dispute before the lower court. That the claim of the respondent was with the appellant for almost two months before the date of judgment which the appellant never challenged at all. Thus, e the respondent was entitled to judgment in the sum claimed inclusive of the rate of interest. Learned Counsel for the respondent argues that the lower court was right in awarding the interest at 15% in favour of the respondent as the appel- f lant did not challenge same at the hearing of the suit under the undefended list. That the Counsel that represented the appellant before the lower court admitted that the appellant was owing the respondent thus they did not file any paper. That admission by a Counsel is binding on the client. g Issue No.1 as formulated by the appellant concerns the justification on the award of 15% interest per annum on the sum of $120,000 American Dollars from 26 April, 1995 to 26 August, 1997 in favour of the respondent. The claim of h 15% interest by the respondent is contained in paragraph 2 of the respondent’s particulars of claim as filed in the lower court, the said paragraph 2 of the respondent’s particulars of claim read thus:– i “2. The plaintiff also claims against the defendant an interest of 15% per annum on the said sum of U.S $120,000 from the date of deposit that is 26 April, 1995 to date of judgment and 10% court rate from the date of judgment until final liquidation of the entire judgment debt.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA International Trust Bank Plc v Kautal Hairu Company Ltd 185 a This Court stated clearly the position of the proper procedure for raising claim of interest on a sum claimed in an action in Jos Steel Rolling Co Ltd v Bernestielli Nig Ltd b (supra). This Court stated thus:– “For a claim of interest to properly exist for determination in a court of law, it must be stated in the endorsement of the claims to the Writ of Summons or in the Statement of Claim also the grounds upon which the claim of interest is based must be stated c whether the claim is based on contract or statute. Consequently, before a person can succeed on a claim of interest, he must endorse the claim on the writ and also plead facts which would show that he is entitled to such interest. In the instant case, the d respondent having sued under the undefended list must state in the endorsement of the claims to Writ of Summons or in the affidavit whether the claim of interest is based on contract or statute and the grounds upon which the claim is based. (Himma Merchants Ltd. v Aliyu (1994) 3 NWLR (Pt. 347) 667 referred to).” e In the appeal at hand, the respondent in his particulars of claim before the lower court merely claim against the appellant interest of 15% per annum on the sum of $120,000 American Dollars from April, 1995 to the date of judgment. f His suit is on the undefended list, there is nothing in his writ of summons or in the affidavit before the Court stating whether the claim of interest is based on contract or statute and the grounds upon which the claim is based. I have g carefully perused the writ of summons and affidavit evidence before the court as filed by the respondent there is nothing whatsoever showing or indicating the circumstances or grounds upon which the claim of 15% per annum on the h $120,000 is based. The law is that payment of interest on a debt must be strictly proved by evidence for a trial court will not infer payment of interest for alleged usage or custom unless such usage or custom is established by evidence. In i Akpabuyo Local Government v Duke (supra) this Court states the law thus:– “Interest will be payable where there is an express agreement to that effect and that such an agreement may be inferred from a course of dealing between the parties. In the instant case since j neither the supporting affidavit to the writ nor the writ itself

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disclosed any agreement between the parties as the basis for the a award of the interest, the award of the interest on the principal sum cannot be sustained. (Alfortin Ltd. v A.G. Federation (1996) 9 NWLR (Pt. 475) 634; Ekwunife v Wayne (W.A) Ltd. (1989) 5 NWLR (Pt. 122) 422 referred to).” b As stated earlier in this judgment, the respondent has not by his writ of summons or in his affidavit in support of his claim on the undefended list disclosed the grounds upon c which he based his claim of 15% interest per annum on the $120,000. Therefore his claim of 15% interest per annum on the said sum of $120,000 before the lower court is not sustainable. Accordingly, Issue No.1 is resolved against the respondent in favour of the appellant. d Issue No. 2 – Whether the appellant was not denied a fair hearing on the issue of interest claimed by the respondent having regard to the acknowledgment of the lower court that e it failed to record and rule on the objection made on behalf of the appellant. Learned Counsel for the appellant submits that in this case the learned trial Judge acknowledged that the appellant had f raised objections to the claim for interest of 15% per annum when the respondent applied for judgment. That he also acknowledged that he did not note it. From the record of appeal it is also obvious that he did not determine the g objections of the appellant by ruling on those objections. Learned Counsel contends that it was the duty of the Honourable Judge to record fully the proceedings before him including the objections raised by the appellant to the h claim for interest at 15% per annum. Counsel referred to section 84 of the Kano State High Court Law Cap 57 Volume 2 Laws of the Kano State. Counsel also referred to Shylion v Aseiw (1994) 6 NWLR (Part 353) 670 at 687 and 695; Otpo v Sunmonu and others (1987) 2 NWLR (Part 58) i 587 at 624; Fawehinmi Construction Co Ltd v Obafemi Awolowo University (1998) 6 NWLR (Part 553) 171 at 182. Further, Counsel for the appellant submits that the trial Judge failed in his duty first to record the objections of the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA International Trust Bank Plc v Kautal Hairu Company Ltd 187 a appellant and also failed in his duty to decide the objections of the appellant. Counsel contends that the learned trial Judge was bound to rule on the objections of the appellant b regarding the claim for interest and his failure to do so constituted a denial of fair hearing guaranteed to the appellant under the Constitution. Reference made to Eriobona v Obiora (1999) 8 NWLR (Part 616) at 622; c Okoro v Okoro and another (1998) 3 NWLR (Part 540) 65 at 74; Akor and others v Abu (1988) 3 NWLR (Part 85) 696 at 713; Mikailu v The State (2001) 8 NWLR (Part 715) 469 at 487; Adigun v A-G, Oyo State (1987) 1 NWLR (Part 53) 678. For the meaning of the word “hearing”, Counsel d referred to Stroud’s Judicial Dictionary (4ed) Volume 2. Finally on Issue No. 2, Counsel urged that the decision to award interest of 15% per annum on the sum of US$120,000 reached in violation of the appellant’s constitutional right to e fair hearing be set aside as a nullity. In reply on Issue No.2, learned Counsel for the respondent submits that the appellant was not entitled to be heard on whatever issue before the lower court in an undefended suit f as it failed to file any notice of intention to defend the suit after being served with the writ of summons containing the detailed claim of the respondent against it. Learned Counsel for the respondent argues that the question of not recording g what the appellant said or submitted before the lower court on the issue of awarding interest did not arise because the appellant did not file any notice of intention to defend. That the position of the law as rightly held in the case of Ben h Thomas Hotels Ltd v Sebi Furniture Co Ltd (1989) 12 SCNJ 71 is that once a party/defendant to an undefended suit does not file notice of intention to defend is not entitled to be heard on the date of hearing. i The complaint of the appellant on Issue No. 2 was that he was denied a fair hearing on the issue of interest claimed by the respondent having regard to the acknowledgment of the lower court that it failed to record and rule on the objections j made on behalf of the appellant.

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The case against the appellant at the lower court was a heard and determined under what is known as the undefended list and Order 23 of the Kano State High Court (Civil Procedure) Rules, 1988 set out clearly the procedure b to be adopted in the disposal of a case brought under the undefended list procedure and in the instant appeal Order 23 rules 3(1) and (4) of the Kano State High Court (Civil Procedure) Rules are relevant in the determination of Issue c No. 2 under consideration. Order 23 rule 3(1) states:– “If a party served with this Writ of Summons and affidavit delivers to the Registrar a notice in writing that he intends to defend the Suit together with an affidavit disclosing a defence on the merit, the court may give him leave to defend upon such terms as the d court may think just.” Order 23 rule 4 states:– “Where any defendant neglects to deliver the notice of defence and affidavit prescribed by Rule 3(1) or is not given leave to e defend by the court, the suit shall be heard as an undefended suit and judgment given thereon, without calling upon the plaintiff to summon witnesses before the court to prove his case formally.” From the printed record of proceedings before the court f specifically page 12 of the record of proceedings and the of (sic) 31 July, 1997, it is clear that the case against the appellant is being heard on the undefended list and if the appellant intends to contest the suit under the law he must g filed his notice of intention to defend the suit within the time allowed by the law together with an affidavit disclosing a defence on the merit for the consideration of the lower court which may give him leave to defend upon such terms as it h may think just. In the instant appeal, there is nothing whatsoever indicating that the appellant has filed notice of intention to defend or was given such leave to defend. The failure of the appellant to comply with the provisions of Order 23 rule 3(1) of the Kano State High Court (Civil i Procedure) Rules leaves the lower court with only one option that is to apply the provisions of Order 23 rule 4 of the Kano State High Court (Civil Procedure) Rules that is to enter judgment in the undefended suit. The Supreme Court j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA International Trust Bank Plc v Kautal Hairu Company Ltd 189 a in Ben Thomas Hotels Ltd v Sebi Furniture Ltd (supra) held thus:– “By the provisions of Order 3 Rules 8 – 12 of the High Court of b Kwara State (Civil Procedure) Rules, 1975, when a case entered on the ‘undefended list’ comes to court on the return date, the court has one and only one duty, namely to see whether the defendant has filed a Notice of Intention to defend and an affidavit. If no such notice and affidavit has been filed within five c days before the return date, the court has no choice in the matter but to proceed to judgment.” In the appeal at hand going by the above pronouncement of the Supreme Court, since there is nothing to show that the d appellant has filed a Notice of Intention to defend with an affidavit disclosing a defence on the merit. The only option opened to the lower court is to proceed to judgment. Therefore the issue that the appellant has not been heard on e the issue of 15% interest does not arise at all. If at all he wants to be heard on the issue, he has to comply with the procedure prescribed by Order 23 rule 3(1). Accordingly, Issue No. 2 is resolved against the appellant in favour of the f respondent. Issue No. 3 – Whether the entire judgment on the undefended list including the award of interest made by the Judge was not a nullity. It is submitted for the appellant that g the respondent neither sought for nor obtained leave to issue, place or enter the writ of summons for hearing on the undefended list and thus rendering the hearing of the suit on the undefended list and judgment delivered on 26 August, h 1997 including the award of interest a nullity. Reference made to Cash Affairs Finance Ltd and another v Inland Bank Nig Plc (2000) 5 NWLR (Part 658) 568 at 587 – 589; Maley v Isah (2000) 5 NWLR (Part 658) 651. i In reply to the submissions of learned Counsel to the appellant on Issue No. 3, learned Counsel to respondent submits that the preliminary objection now raised by the appellant that the respondent did not obtain leave to file the j suit under the undefended suit is an afterthought. That this

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Jega JCA 190 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) objection ought to be raised timeously. That the suit was a filed before the lower court on 18 July, 1997 and the writ was served on the appellant on 23 July, 1997 but the appellant did not say anything in respect thereof till 22 b April, 2002 when it applied for leave to raise it for the first time on appeal. Counsel for the respondent contends that the preliminary objection is late as the appellant has taken steps by paying the principal sum of $120,000. Reference made to c Saraki v Kotoye (1990) 4 SCNJ 97. The printed record before the Court clearly indicates that the suit of the respondent is on the undefended list. The writ itself at page 2 of the printed record is marked undefended d list. The proceedings of 31 July, 1997 at page 12 of printed record shows beyond any iota of doubt that the suit is on the undefended list. The appellant through his Counsel participated fully in the proceedings and did not object that e the suit was not properly brought on the undefended list. In the cause of the proceedings of 26/8/97 the Counsel to the appellant admitted the claim of the respondent and promised to pay. It is on record that the appellant has taken steps by f paying the principal amount in the sum of $120,000 US Dollars. I therefore see no merit whatsoever in Issue No. 3 as formulated by the appellant. Accordingly, the issue is resolved against the appellant in favour of the respondent. g In the result, since Issue No.1 is resolved in favour of the appellant, the appeal partially succeeds. Accordingly, an order is hereby made setting aside the award of 15% per annum interest on the US$120,000 from 26 April, 1995 to h 26 August, 1997. However, the appeal against the principal sum lacks merit and is hereby dismissed. The judgment in the sum of $120,000 and 10% court interest with effect from 26/8/97 till the judgment sum is fully liquidated in favour of the respondent in Suit No. K/430/97 delivered on 26/8/97 by i Alkali J is hereby affirmed. No order as to costs.

BA’ABA JCA: I have read in draft the judgment of my learned brother, Jega JCA just delivered. I agree with his j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, KADUNA DIVISION) Ba’Aba JCA International Trust Bank Plc v Kautal Hairu Company Ltd 191 a reasoning and conclusion reached in the said judgment. I however wish to add some few words of mine just for the purpose of emphasis. b In my view, having studied the three issues formulated by the appellant, the main issue for determination in this appeal is issue number (1), whether the lower court was right in awarding interest of 15% per annum on the sum $120,000 c from 26 April, 1995 to 26 August, 1997 in favour of the respondent. In the case of Alfotrin Ltd v A-G Federation (1996) 9 NWLR (Part 475) 634 at 664, the Supreme Court of Nigeria d held that at common law and as a general rule, interest is not payable on a debt or loan in the absence of expressed agreement or some cause of dealing or custom to that effect. See Ekwunife v Wayne (WA) Ltd (1989) 5 NWLR (Part 122) e 422 at 445. Guided by these authorities, it seems clear that since neither the supporting affidavit to the writ nor the writ itself disclosed any agreement between the parties as the basis for f the award of interest, the award of interest on the princpal sum can not be sustained. In regard to the award of interest on the judgment debt, it g needs not be specifically claimed before it is awarded. The award is at the discretion of the court and is regulated by rules. See Himma Merchant Ltd v Aliyu (1994) 5 NWLR (Part 347) 667. h Having regard to what has been stated above, issue number one must be resolved in favour of the appellant. The appeal therefore partially succeeds and it is therefore allowed while the appeal in respect of the claim of the i principal sum of $120,000 having been admitted is dismissed. In the result, the order awarding 15% interest by the lower court is hereby set aside while the judgment of the trial court j in respect of the main claim of $120,000 is affirmed by me.

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For these and more fuller reasons contained in the leading a judgment, I too, partially allow the appeal and abide by the consequential orders contained in the leading judgment including that on costs. b

KEKERE-EKUN JCA: I have had the opportunity of reading in advance the lead judgment just delivered by my learned brother, Jega JCA c I agree with his reasoning and conclusion, which I respectfully adopt his as mine. I agree with the order as to costs as contained in the lead judgment. Allowed appeal in part. d

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NNB International Bank Plc v Triumph Bank Plc 193 a NNB International Bank Plc v Triumph Bank Plc

FEDERAL HIGH COURT OF NIGERIA, LAGOS DIVISION b MUSTAPHA J Date of Judgment: 17 NOVEMBER, 2005 Suit No.: FHC/L/CS/1148/2004

Banking – Bank in receivership – Whether can still charge c interest on loans Banking – Winding-up of bank – Petition – Who can present – Sections 36, 38, 55 and 58 Banks and Other Financial Institutions Decree No. 25 of 1991 and section 410(b) d Companies and Allied Matters Act Cap. 59 Laws of the Federation of Nigeria, 1990 Company law – Bank – Winding-up of – Who can present petition – Sections 36, 38, 55 and 58 Banks and Other e Financial Institutions Decree No. 25 of 1991

Facts The petitioner brought a petition for the winding-up of the f respondent who contended that the petitioner had no locus standi, not being one of the category of persons who could do so. g Held – 1. Part XV of the Companies Act deals generally with winding-up of companies. In its section 410 it lists those who can present a petition to wind-up a Company. A h creditor which the petitioner is, is conferred with powers under section 410(b) of the Companies Act to present a petition to the Court for winding-up of a company. But while the Companies Act deals generally with winding- i up of Companies, BOFID deals specifically with winding-up of banks. 2. It is provided in section 36 of BOFID that notwithstanding anything contained in any law or j Memorandum and Articles of Association of a bank,

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where the CBN or an appointed person has pursuant to a an order under section 34 of BOFID, assumed control of a bank whose paid-up capital is lost or unrepresented by available assets CBN may with the approval of the b President and Commander-in-Chief of the Armed Forces of the Federal Republic of Nigeria make an order revoking the bank’s licence and requiring its business to be wound-up. c 3. Under section 38(1) of BOFID, it is after the CBN Governor has made an order revoking the licence of a bank and requiring the business of the bank to be wound-up that the bank whose licence has been revoked, d shall within 14 days of the date of the order apply to the Federal High Court for an order winding-up the affairs of the bank and if the bank fails to apply to the Federal High Court within the aforesaid period, the CBN e Governor may apply to Federal High Court to wind-up the bank. 4. If the Governor is satisfied that it is in the public interest to do so, he may without waiting for the aforesaid period f to elapse, appoint NDIC or any other person as the official receiver or as a provisional liquidator and NDIC or such other person shall have the power conferred by or under the Companies Act and shall be deemed to have g been appointed as provisional liquidator by the Federal High Court for the purpose of the Companies Act. 5. Even though section 55(1) of BOFID provides that the provision of BOFID shall apply without prejudice to the h provisions of the Companies Act, it goes further to say in section 55(2) that where any provision of the Companies Act is inconsistent with that of BOFID the provision of BOFID shall prevail. i 6. Section 36 of BOFID having been enacted notwithstanding anything contained in any law, overrides the provision of section 410(1)(a) of the Companies Act. As a special provision pertaining to banks, section 36 of j

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NNB International Bank Plc v Triumph Bank Plc 195 a BOFID has derogated from the general provision of section 410(1)(b) of the Companies Act which applies only to winding-up of companies. The maxim is special b words derogate from general ones. The law-makers would be taken to have in their minds the provision of section 410 of the Companies Act when they enacted section 36 of BOFID. c 7. Per curiam “My understanding of the provisions of BOFID particularly sections 36 and 38 thereof is that before an application is made to wind-up a bank, the banking licence of that bank d must have been revoked by the Governor of CBN with the approval of the President, Commander-in-Chief of the Armed Forces of the Federal Republic of Nigeria and that the application can only be presented by the Bank whose licence has been revoked, the Governor of CBN or any other person e appointed by the Governor of CBN. The wisdom behind the provisions of sections 36 and 58 of BOFID is not far to seek. A bank is not like an ordinary company, shareholders and depositors funds are involved. These shareholders and f depositors may run into thousands. These funds need to be protected. If every creditor to whom a bank is indebted to the sum exceeding N2, 000 (two thousand naira) is allowed to present a winding-up petition, the result could be devastating. This is more so in this country where there is a g growing penchant for resorting to court actions even in disputes that can be easily resolved. I hold that the petitioner, does not fall into the categories of the people who can present a petition to wind-up the h respondent bank and so lacks the locus standi to present this petition.” Striking out the petition. i Cases referred to in the judgment Nigerian Financial Merchant Bank Ltd v NDIC (1995) 6 NWLR (Part j 400) 226

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Oriental Airlines Ltd v Air Via Ltd (1998) 12 NWLR (Part a 577) 271 Tate Ind Plc v Devcom Merchant Bank Ltd (2004) 17 NWLR (Part 901) 182 b Wema Bank Plc v Merchant Bank of Africa FHCLR (1996) 687

Nigerian statutes referred to in the ruling c Banks and Other Financial Institution Decree No. 25 of 1991, sections 32, 33, 34, 36, 37(1), 38, 38(1), 40, 55(1), 55(2) Companies and Allied Matters Act Cap 59 Laws of the d Federation of Nigeria, 1990, sections 77, 409, 409(a), 410, 410(1), 410(1)(a), 410(1)(b)

Counsel e For the petitioner: Ntephe For the respondent: Akinbola (with him Nwagwu)

Judgment f MUSTAPHA J: On 9 December, 2004 NNB International Bank Plc hereinafter referred to as the “petitioner” filed a petition in this Court to wind-up Triumph Bank Plc hereinafter referred to as the “respondent” under the g Companies and Allied Matters Act. On 17 December, 2004 the petitioner brought a motion pursuant to Rule 19 of Companies Winding-Up Rules, 2001 to advertise the petition. In reaction the respondent on 2 February, 2005 filed h a notice of preliminary objection to the hearing and granting of the petitioner’s motion to advertise on the following grounds:– 1. The winding-up petition filed by the petitioner is i premature and/or defective having failed to comply with the provisions of sections 32 and 33 of Banks and Other Financial Institutions Decree No. 25 of 1991. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, LAGOS DIVISION) Mustapha J NNB International Bank Plc v Triumph Bank Plc 197 a 2. The Petitioner lacks locus standi to institute this petition as it’s only the CBN Governor under section 36 of BOFID that can apply to the Federal High Court b to wind-up a bank. 3. The petitioner has failed to comply with section 37(1) of BOFID. 4. The letters of demand as exhibited by the petitioner c are incurably defective as they do not satisfy the requirements of a statutory demand as provided in law. d The two applications were taken together. In his address, the learned Counsel for the petitioner placed reliance on all five paragraphs of the affidavit filed in support of the motion to advertise the petition. e According to the learned Counsel, the procedural pre- condition is that the affidavit verifying the petition should have been filed and served, a fact which has been deposed to in the affidavit filed in support of this motion. He therefore f submitted that the stage is now set for the Court to proceed under Rule 19(2) of the Winding-Up Rules, 2001 and make the order being sought in the motion. In his own address, the learned Counsel for the g respondent submitted that the winding-up petition filed is premature and/or defective having failed to comply with the provisions of sections 32 and 33 of Banks and Other Financial Institutions Decree No. 25 of 1991 hereinafter h referred to as “BOFID”. It was argued that the petitioner having failed to apply to the Governor of CBN to declare the respondent as a failing Bank and to take over the management of the respondent Bank, cannot and is debarred i from applying to the Court to wind-up the respondent bank. He observed that the major ground upon which this petition was filed, is that the respondent is unable to pay its debt and submitted that the circumstance under which a j company shall be deemed to be unable to pay its debt is

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, LAGOS DIVISION) Mustapha J 198 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) defined in section 409 of the Companies and Allied Matters a Act, 1990 hereinafter referred to as “the Companies Act” and referred to Exhibits “A3”, “A4” and “A5” attached to the petition and stated that the respondent gave reason for b not being able to repay the debt upon demand. He cited the case of Oriental Airlines Ltd v Air Via Ltd (1998) 12 NWLR (Part 577) 271 at 280 in support of the submission that once a debtor has given a reason for being unable to pay its debt c upon demand the Court shall not treat the situation as a neglect in determining its ability to pay or not to repay its debt. Referring to sections 36 and 38 of BOFID, he contended d that the petitioner lacks locus standi to present a petition to wind-up a Bank as it is only the Governor of CBN that has the authority upon approval of the President of the Nation to apply to this Court for a bank to be wound-up. The CBN it e was argued, must authorise NDIC before NDIC can file a petition to wind-up a bank. According to the learned Counsel, section 38 of BOFID provides that for the Governor of CBN or his nominee f to present a petition for winding-up a bank before the Court, such a bank’s banking licence must have been revoked, and so failure of the petitioner to prove to this Court that the banking licence of the respondent has been revoked g by the Governor of CBN, is fatal to the presentation of this petition and same should not be entertained by this Court. It was further submitted that the respondent was not given h reasonable opportunity of making representation if there is a case against it as required by section 37(1) of BOFID and has therefore even put paid to the exercise of even the CBN Governor to revoke the licence. i Section 409(c) of the Companies Act was referred to in support of the submission that before this Court makes an order that the respondent is unable to pay its debt or not, it has to look at the prospective liability of the company. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, LAGOS DIVISION) Mustapha J NNB International Bank Plc v Triumph Bank Plc 199 a Exhibits “A1”, “A2” and “A3” are said to be defective because they do not satisfy the requirement of sections 409(a) and 77 of the Companies Act as to the content and b the person that is empowered to give such a demand. Reliance was placed on the case of Tate Ind Plc v Devcom Merchant Bank Ltd (2004) 17 NWLR (Part 901) 182 at 220. The Court was urged to decline jurisdiction. c In his reply on points of law, the learned Counsel for the petitioner contended that sections 32 and 33 of BOFID do not oblige an unpaid creditor to apply to the CBN Governor to wind-up a company that is a bank. He referred to section d 410(1) of the Companies Act which specifies the category of persons that can bring winding-up proceedings in support of his submission that a creditor derives his locus standi not from BOFID but from the Companies Act and that the e Petitioner can apply that a bank be wound-up. According to him BOFID recognizes this when in its section 55(1) provides that in matters of winding-up, provisions of BOFID shall apply without prejudice to the provisions of the f Company Act. He referred to the cases of Wema Bank Plc v Merchant Bank of Africa FHCLR (1996) 687 and 691 as per Bioshogun J and Financial Merchant Bank Ltd v NDIC (1995) 6 NWLR (Part 400) 226 – 240. g He therefore submitted that BOFID does not extinguish the right of a creditor to commence under the Companies Act, winding-up proceedings against a company which is also a bank. h On the question whether the condition for commencing winding-up proceeding has been satisfied, he submitted that the demand made in this case fully complied with sections 409(a) and 77 of the Companies Act in that the Petitioner i has pleaded the date of service of the demand and has shown that at the time this matter was commenced on December 2004 more than three weeks had elapsed from date of delivery of the demand at the respondent’s company head j office. The case of Oriental Airlines v Air Via Ltd (supra)

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, LAGOS DIVISION) Mustapha J 200 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) was distinguished from this case in that in this case the debt a is not being disputed. He urged the Court to grant the application to advertise and dismiss the notice of preliminary objection. b In his own reply the learned Counsel for the respondent, referred to section 55(2) of BOFID which provides that where there is any inconsistency between provisions of c BOFID and CAMA, the provision of BOFID shall prevail and submitted that inasmuch as section 410 of the Companies Act conflicts with section 40 of BOFID as to who could file a winding-up petition against a bank, then d section 410 of the Companies Act shall be invalid to the extent of such inconsistency. The case of Financial Merchant Bank Ltd v NDIC (supra) is said not to apply to this case because it relates to a bank whose licence at the time had already been revoked. e The first issue that calls for determination is whether the Petitioner has locus standi to present this petition. In doing so I only need to examine the petition wherein it is averred f that the petitioner is a bank licensed in Nigeria and carrying on business at divers (sic) branches and at its head office at 290A Akin Adesola Street, Victoria Island, Lagos. The respondent was established to carry on the business of g merchant banking and to transact and do all matters and things incidental thereto. It is further averred that the respondent is unable to pay its debts and that on 1 November, 2004 the outstanding debt was N54,742,816.14. The petitioner was said to have served on the respondent on h 1 November, 2004 at the respondent’s Head Office at 186 Awolowo Road, Ikoyi, Lagos a demand under the petitioner’s hand, requiring the respondent to pay the said debt. The respondent has however been unable to pay the sum or to i secure or compound for it to the reasonable satisfaction of the petitioner. The petitioner therefore prays that the respondent bank be wound-up by the Court under the Companies Act. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, LAGOS DIVISION) Mustapha J NNB International Bank Plc v Triumph Bank Plc 201 a It is not in dispute the fact that the respondent that is being sought to be wound-up is a Bank. The fact that the respondent is indebted to the petitioner has not been b disputed. Part XV of the Companies Act deals generally with winding-up of companies. In its section 410 it lists those who can present a petition to wind-up a company. A creditor which the petitioner is, is conferred with powers under section 410(b) of the Companies Act to present a c petition to the Court for winding-up of a company. But while the Companies Act deals generally with winding-up of companies, BOFID deals specifically with winding-up of banks. d It is provided in section 36 of BOFID that notwithstanding anything contained in any law or memorandum and articles of association of a bank, where the CBN or an appointed person has, pursuant to an order under section 34 e of BOFID, assumed control of a bank whose paid-up capital is lost or unrepresented by available assets, CBN may with the approval of the President and Commander-in-Chief of the Armed Forces of the Federal Republic of Nigeria make f an order revoking the bank’s licence and requiring its business to be wound-up. Under section 38(1) of BOFID, it is after the CBN Governor has made an order revoking the licence of a bank and requiring the business of the bank to g be wound-up that the bank whose licence has been revoked, shall within 14 days of the date of the order apply to Federal High Court for an order winding-up the affairs of the bank and if the bank fails to apply to the Federal High Court h within the aforesaid period, the CBN Governor may apply to Federal High Court to wind-up the bank. If the Governor is satisfied that it is in the public interest to do so, he may without waiting for the aforesaid period to elapse, appoint NDIC or any other person as the official receiver or as a i provisional liquidator and NDIC or such other person shall have the power conferred by or under the Companies Act and shall be deemed to have been appointed as provisional liquidator by the Federal High Court for the purpose of the j Companies Act.

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Even though section 55(1) of BOFID provides that the a provision of BOFID shall apply without prejudice to the provisions of the Companies Act, it goes further to say in section 55(2) that where any provision of the Companies Act b is inconsistent with that of BOFID the provision of BOFID shall prevail. To my mind, section 36 of BOFID having been enacted notwithstanding anything contained in any law, overrides c the provision of section 410(1)(a) of the Companies Act. As a special provision pertaining to banks, section 36 of BOFID has derogated from the general provision of section 410(1)(b) of the Companies Act which applies only to d winding-up of companies. The maxim is “special words derogate from general ones”. The law-makers would be taken to have in their minds the provision of section 410 of the Companies Act when they enacted section 36 of BOFID. e My understanding of the provisions of BOFID particularly sections 36 and 38 thereof is that before an application is made to wind-up a bank, the banking licence f of that bank must have been revoked by the Governor of CBN with the approval of the President, Commander-In- Chief of the Armed Forces of the Federal Republic of Nigeria and that the application can only be presented by the g bank whose licence has been revoked, the Governor of CBN or any other person appointed by the Governor of CBN. The wisdom behind the provisions of sections 36 and 58 of BOFID is not far to seek. A bank is not like an ordinary company, shareholders and depositors funds are h involved. These shareholders and depositors may run into thousands. These funds need to be protected. If every creditor to whom a bank is indebted to the sum exceeding N2,000 (two thousand Naira) is allowed to present a i winding- up petition, the result could be devastating. This is more so in this country where there is a growing penchant for resorting to Court actions even in disputes that can be easily resolved. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, LAGOS DIVISION) Mustapha J NNB International Bank Plc v Triumph Bank Plc 203 a I hold that the petitioner, does not fall into the categories of the people who can present a petition to wind-up the respondent bank and so lacks the locus standi to present this petition. The motion to advertise the petition is refused and the petition itself is struck out.

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a African Continental Bank Plc and another v Okorie

COURT OF APPEAL, ENUGU DIVISION b OGEBE, GALADIMA, ADEKEYE JJCA Date of Judgment: 24 NOVEMBER, 2005 Suit No.: CA/E/l8/2003

Banking – Interest – Principles applicable c Facts The initial claim of the plaintiff against the defendants jointly and severally dated 18/5/87 and filed on 19/5/87 was subsequently amended. The amended statement of claim d dated 6/9/96 and filed on 30/9/96 reads as follows:– “(i) A declaration that upon the payment of the sum of N105,074.81 to the 1st defendant by the plaintiff on 14 December, 1987, the plaintiff had fully and finally paid off e his outstanding indebtedness to the 1st defendant. (ii) A declaration that the plaintiff is entitled to the refund of all excess interest charged and unmerited/unauthorised charges debited to his Account No. 085 by the 1st defendant amounting to N50,647.38. f (iii) An order of perpetual injunction restraining the defendants or their servants or agents or privies from selling the plaintiff’s properties situate at Plot 8, Block A1, New Haven East Layout and Plot 1, Block 4, Ogui New Layout g otherwise known as No. 12 Onyiuke Street, Ogui New Layout, Enugu and Plot 9, Block 43 Asata, Enugu. (iv) Payment of N100,000.00 (One Hundred Thousand Naira) damages to the plaintiff for malicious publication; (v) An order of court directing the defendants to return to the h plaintiff his original documents of title in respect of the above three properties and issue him with a formal deed of release.” Consequential to the amended statement of claim, the i defendants amended their statement of defence dated and filed on 4/10/96. During the trial, the plaintiff and his witnesses gave evidence. The defendants also testified. Some exhibits were j

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African Continental Bank Plc and another v Okorie 205 a tendered. At the end of the trial, the learned trial Judge entered judgment in favour of the plaintiff restraining the defendants or their servants, agents or privies from selling b the plaintiff’s properties situate at Plot 8, Block A1, New Haven East Layout, Enugu and Plot 1, Block 4, Ogui New Layout, Enugu and Plot 9, Block 43 Asata, Enugu. With respect to the claim of N100,000, he declined jurisdiction c because appropriate fees were not paid for this claim. The court also ordered the defendants to return all original documents of title in respect of the three properties and to effect a formal deed of release to the plaintiff. d Dissatisfied with the judgment, the defendants lodged an appeal to this court.

Held – e In banking transactions, the question of steady accrual of interest on a particular account is a matter the court is expected to take judicial notice of under section 74 of the Evidence Act Cap 112 Laws of the Federation of Nigeria, f 1990. However there must be evidence. The rate of interest is never static. It fluctuates according to the dictates of the Central Bank of Nigeria, as provided by section 15 of the Banking Act Cap 28 Laws of the Federation of Nigeria, g 1990. Appeal dismissed.

Cases referred to in the judgment h Nigerian Arowolo v Akapo (2003) 8 NWLR (Part 823) 451; (2004) All FWLR (Part 208) 807 i CBN v Ozigi (1994) 3 SCNJ 42 FBN v Uwada (2003) 2 NWLR (Part 805) 485 Hashidu v Goje (2003) 15 NWLR (Part 843) 352; (2004) All j FWLR (Part 228) 662

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Jinadu v Esurombi-Aro (2005) All FWLR (Part 251) 349; a (2005) 14 NWLR (Part 944) 142 Osun State Govt v Dalami (Nig) Ltd (2003) 7 NWLR (Part 818) 72 b Remalo Ltd v NBN Ltd (2003) 16 NWLR (Part 846) 235 Wilson v Oshin (2000) FWLR (Part 14) 2311; (2000) 9 NWLR (Part 673) 442 c Nigerian statutes referred to in the judgment Banking Act Cap 28 Laws of the Federation of Nigeria, 1990, section 15 d Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, section 74

Counsel e For the appellants: Okereke For the respondent: Anike

Judgment f GALADIMA JCA: (Delivering the lead judgment) The initial claim of the plaintiff against the defendants jointly and severally dated 18/5/87 and filed on 19/5/87 was subsequently amended. The amended statement of claim g dated 6/9/96 and filed on 30/9/96 reads as follows:– “(i) A declaration that upon the payment of the sum of N105,074.81 to the 1st defendant by the plaintiff on 14 December, 1987, the plaintiff had fully and finally paid off h his outstanding indebtedness to the 1st defendant. (ii) A declaration that the plaintiff is entitled to the refund of all excess interest charged and unmerited/unauthorised charges debited to his Account No. 085 by the 1st defendant i amounting to N50,647.38. (iii) An order of perpetual injunction restraining the defendants or their servants or agents or privies from selling the plaintiff’s properties situate at Plot 8, Block A1 New Haven, East Layout and Plot 1, Block 4 Ogui New Layout j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA African Continental Bank Plc and another v Okorie 207 a otherwise known as No. 12 Onyiuke Street, Ogui New Layout, Enugu and Plot 9, Block 43 Asata, Enugu. (iv) Payment of N100,000.00 (One Hundred Thousand Naira) b damages to the plaintiff for malicious publication. (v) An order of court directing the defendants to return to the plaintiff his original documents of title in respect of the above three properties and issue him with a formal deed of release.” c Consequential to the amended statement of claim, the defendants amended their statement of defence dated and filed on 4/10/96. d During the trial, the plaintiff and his witnesses gave evidence. The defendants also testified. Some exhibits were tendered. At the end of the trial, the learned trial Judge entered judgment in favour of the plaintiff restraining the defendants or their servants, agents or privies from selling e the plaintiff’s properties situate at Plot 8, Block A1, New Haven East Layout, Enugu and Plot 1, Block 4, Ogui New Layout, Enugu and Plot 9, Block 43 Asata, Enugu. With respect to the claim of N100,000, he declined jurisdiction f because appropriate fees were not paid for this claim. The court also ordered the defendants to return all original documents of title in respect of the three properties and to effect a formal deed of release to the plaintiff. g Dissatisfied with the judgment, the defendants lodged an appeal to this Court filing a notice of appeal containing three grounds of appeal. Distilled from the grounds are the following two issues:– h “1. Whether the plaintiff has satisfactorily proved that he has liquidated the entire debt and interest owed the defendant/ appellant (the bank) in respect of the facilities granted him by paying on 14 December, 1987 the sum of N105,074.81 i which plaintiff’s witness said was based on calculation up to 27 July, 1987, what happened to the interest element between July, 1987 and December, 1987 (sic). 2. Whether the appellant bank as a financial institution regulated by Central Bank was entitled to comply with j Central Bank guidelines or not. A decision on the above

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issues will determine whether the respondent is entitled to a have his property documents returned to him without further payment or not.” Learned Counsel for the respondent raised the following b three issues for determination:– “1 Whether the credible evidence offered at the trial on the side of the plaintiff/respondent do not (sic) outweigh that offered for the 1st defendant/ appellant when placed side by side on c an imaginary scale. 2. Whether, when the onus shifted to the 1st defendant at the trial, on the issue of the applicable interest on the loan and the accuracy or otherwise of the 1st defendant’s com- putations of the plaintiff’s indebtedness, they (the defendant) d led enough credible evidence to dislodge the case of the plaintiff/respondent. 3. Whether there was not enough credible evidence in the circumstances of this case to support the trial court’s e conclusion that the payment of N10,907.81 by the plaintiff/ respondent extinguished the plaintiff/respondent indebtedness to the defendant/appellant.” I must observe that the issues that arise from the decision of f the lower court were most inelegantly formulated in the briefs of the parties in this appeal. To my mind the question that can arise for determination in this appeal ought to be set out thus:– g “Whether in the circumstances of this case, there was enough evidence to support the conclusion reached by the trial court that the payment of N105,074.81 by the respondent to the appellant extinguished the respondent’s indebtedness which thereby entitled the plaintiff to the judgment and orders made by the court.” h All other issues raised in the briefs such as the interest accruable from July, 1987 to December, 1987 and the consequential order of perpetual injunction, liability for damages for malicious publications and the demand for the i return of the title documents of the mortgaged properties are incidental and quite dependent on whether the respondent has made out a successful claim so as to be entitled to such claims. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA African Continental Bank Plc and another v Okorie 209 a It is the contention of the appellants that the respondent did not satisfy the trial court with credible evidence that he has liquidated the entire and accrued interest on the loan b granted him by the appellant. That the respondent was granted a total of N200,000 loan at agreed interest rate of 11,5% per annum. In return, he gave out his properties as security. Following this, a mortgage deed, exhibit “A”, was c executed. That the respondent repaid only N105,074.81 on 14/12/87 as against his total indebtedness of N151,452.22 as at 15/5/87. It is further contended by the appellants that the mere fact d that an action had been instituted in court does not mean that the interest accruable on the account will stop running. That the respondent is bound to pay the fees, expenses and interest charged on his account. e The learned Counsel for the respondent on the other hand submitted that the payment of N105,074.81 made on 14/12/87 to the appellants finally discharged and relieved the respondent of his indebtedness to the bank. f This appeal really turns to be essentially on the question whether the learned trial Judge was right in his conclusion when he held that the payment of N105,074.81 finally discharged and relieved the respondent of his indebtedness. g My careful study of the judgment of the trial court shows clearly that the learned trial Judge did embark on a meticulous consideration, analysis and evaluation of the evidence offered by the parties. Competing claims were carefully weighed. The gist of the respondent’s case is that h the figure shown on the statement of account, exhibit “O” issued to him by the appellant in respect of his overdraft in his current account was inaccurate, inflated, bloated, unauthorised and illegal charges (sic) and that the interest i rate claimed was higher than what was contained in the legal mortgage. Respondent as PW1 contended that the figure N155,772.19 posted as his debit balance in exhibits “B” and “C” was not satisfactory. The respondent employed the j service of an accountant to compare compilation of interest

2 [2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA 210 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) charges so as to ascertain the accuracy of the charges on his a account. He used the Central Bank guidelines and came to the conclusion that the bank debited the respondent with excess interest charges and other unauthorised charges b amounting to N50,647.38. It would appear to me that this evidence in exhibit “J” was neither challenged nor contradicted. DW1 admitted the assertion when he said in his evidence that the appellants were charging between 1,5% c and 2% interest above the Central Bank of Nigeria’s guidelines. I refer to paragraph 10 of the respondent’s statement of claim where he pleaded that the condition upon which the sum of N105,074.81 was paid to the first appellant was in full and final settlement and was discharged d of his indebtedness. Appellants in their amended statement of defence acknowledged receiving the respondent’s solicitor’s letter to that effect. Parties in fact joined issues on the question of settlement of the indebtedness of the e respondent. Each party was therefore to lead evidence in proof of his own position on this matter. Therefore, when the respondent testified and tendered evidence of payment and excess interest rate and some unmerited and f unauthorised charges, the appellants had the uphill task of countering these claims. They failed to challenge or cross- examine PW2, the accountant who prepared exhibit “J” as to the propriety or applicability of the interest rate used by him g to re-check and re-compute the respondent’s statement of account. Appellants were therefore taken to have admitted the accuracy and correctness of exhibit “J”. What is more, as I have observed DW1 an employee of the first appellant testified and conceded under cross-examination in the h record that the first appellant charged interest on the respondent’s account at a rate higher than the maximum interest rate prescribed by the Central Bank of Nigeria credit guidelines. i With the state of affairs as stated above, the appellants were bound to prove that any other sum of money was still outstanding to the respondent’s credit balance on his account. The receipts evidencing the alleged expenses for j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA African Continental Bank Plc and another v Okorie 211 a which the respondent’s account was debited were not tendered. Appellants are expected to effectively challenge exhibits “F” and “J” by leading evidence of whatever other b calculations avail them showing how the respondent has not discharged his indebtedness. The letter, which the appellants’ Counsel wrote in reply to exhibit “F” though pleaded, was not tendered. If indeed the appellants rejected the conditions on which the money was forwarded, they would c have led evidence to that effect. They failed to do so. There was no oral or documentary evidence showing the rejection of the condition upon which the respondent forwarded the sum of N105,074.81. d In respect of interest, I must say that there was no evidence before the trial court of any additional amount by way of interest or charges that accrued to the benefit of the first appellant on the respondent’s account which would e fault or negate the amount paid by the respondent in full satisfaction of the indebtedness. Statement of account revising the indebtedness up to 14/12/87 showing any additional sum as having been debited against the f respondent is necessary. This was not placed before the court. I agree with the learned Counsel for the respondent when he submitted in his brief that the trial court should not be expected to indulge in speculating as to whether any g additional sum was debited between July, 1987. A very clear and precise evidence becomes necessary to show that some other sum of money was still outstanding on the respondent’s account. It was not enough to plead the amount h outstanding, there must be concrete evidence led. In banking transactions, the question of steady accrual of interest on a particular account is a matter the court is expected to take judicial notice of under section 74 Evidence Act Cap. 112 Laws of the Federation of Nigeria, 1990. However; there i must be evidence. The rate of interest is never static. It fluctuates according to the dictates of the Central Bank of Nigeria, as provided by section 15 Banking Act Cap 28 Laws of the Federation of Nigeria, 1990. See also the case of j CBN v Ozigi (1994) 3 SCNJ 42, 59 – 60. The question that

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Galadima JCA 212 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) was commendably resolved by the lower court was that by a what authority did the first appellant increase the interest. Weighing the evidence of PW1, PW2 and DW2, the learned trial Judge in his judgment, came to the following b conclusion on page 88 of the record:– “Indeed . . . the 1st defendant called no evidence on this vital issue it is indeed obvious that whereas exhibit M in clause I thereof stipulated 9% as the rate of interest, DW1 boldly assorted (sic) (meaning asserted) that 1st defendant and plaintiff agreed on 11%. c The question is whether it is permissible for DW1 to vary conditions in exhibit M on oath, off-handedly. I have grave doubts whether he can do this. See Union Bank Ltd v Ozigi (1994) 3 SCNJ 42 at 59 – 60.” d From the above, the learned trial Judge concluded that the first appellant charged the respondent interest in excess of that approved by the Central Bank of Nigeria in violation of the mutual agreement between the parties. e Since I have held that upon acceptance of the conditions in exhibit “F” the respondent’s debt had become extinguished, he incurred no debt. I also find no justification in claiming any incidental expenses in the process of trying f to effect sale of the respondent’s mortgaged property. It is now trite that the appellate court will not interfere with evaluation of evidence of trial court. The evaluation of relevant and material evidence and the ascription of g probative value to such evidence are the primary duty (sic) of the trial court; because it heard and assessed the witnesses while they testified. This is what happened in the case at hand. The learned trial Judge carefully evaluated and h appraised the facts of this case. It is not my business to substitute my view for that of the trial court. See Wilson v Oshin (2000) FWLR (Part 14) 2311; (2000) 9 NWLR (Part 673) 442; Jinadu v Esurombi-Aro (2005) All FWLR (Part i 251) 349; (2005) 14 NWLR (Part 944) 142. In the result, I hold that there is no merit in the appeal and I accordingly dismiss it. Respondent is entitled to costs which I assess at N7,000 against the appellants. j

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African Continental Bank Plc and another v Okorie 213 a OGEBE JCA: I had a preview of the lead judgment of my learned brother, Galadima JCA just delivered and I agree with his sound reasoning and conclusion. b This is an appeal that should not have been brought to this Court. It is a waste of judicial time. It has no merit whatsoever. I also dismiss it with costs as assessed in the lead judgment. c ADEKEYE JCA: I had a preview of the judgment just delivered by my learned brother, Suleiman Galadima JCA. I agree with him that the major issue for determination by this d Court is whether in the circumstance of this case, there was enough evidence to support the conclusion reached by the trial court that the payment of N105,074.81 by the respondent to the appellants terminated the respondent’s indebtedness which thereby entitled the plaintiff to the e judgment and orders made by the court. Parties joined issues on this crucial issue. In the process of writing the judgment, the learned trial f Judge apparently had put the credible evidence adduced individually by the parties on each side of the imaginary scale before coming to the conclusion that the evidence of the respondent was weightier, and consequently came to the conclusion reached by him. Even going by the evidence on g printed record, the appellants failed to produce all those vital facts required to establish their claim before the court particularly that the sum of N105,074.81 paid on 14/12/87 to the first appellant did not finally discharge and relieve the h respondent of his indebtedness to the bank. The first appellant did not counter the evidence of payment of N105,074.81 in full and final settlement of the debt, charges of excess interest rates and some unauthorised i charges from the respondent’s account. The evidence of the accountant, PW2, engaged by the respondent to re-check and re-compute the respondent’s statement of account, Exhibit “J” and Exhibit “F” were unchallenged by the first j appellant. More importantly, it is also glaring that the first

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 214 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) appellant charged interest on the respondent’s account at a rates between 1,5% and 2% higher than the maximum interest rates prescribed by the Central Bank of Nigeria Credit Guidelines. Exhibit “M” stipulated 9% whereas the b respondent was charged 11%. The appellants did not lead evidence to challenge or reject the conditions on which the respondent forwarded the sum of N105,074.81. Remalo Ltd v NBN Ltd (2003) 16 NWLR (Part 846) 235; FBN v Uwada c (2003) 2 NWLR (Part 805) 485. In effect, the Court was left to conjecture or speculate on the vital evidence required to establish the appellants’ case, particularly that some other sum of money was still outstanding on the respondent’s account besides the N105,074.81. There is no iota of doubt d that the trial court had enough evidence to support its finding, and this Court has no reason to interfere with such finding or find to the contrary. Hashidu v Goje (2003) 15 NWLR (Part 843) 352; (2004) All FWLR (Part 228) 662; e Osun State Govt v Dalami (Nig) Ltd (2003) 7 NWLR (Part 818) 72; Arowolo v Akapo (2003) 8 NWLR (Part 823) 451; (2004) All FWLR (Part 208) 807. For the foregoing reasons and in addition to those f mentioned in the lead judgment, I also find no merit in the appeal. It is accordingly dismissed. I abide the consequential orders made including the order on costs. Appeal dismissed. g

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Wema Bank Plc and others v Abiodun 215 a Wema Bank Plc and others v Abiodun b COURT OF APPEAL, LAGOS DIVISION AKAAHS, OGUNBIYI, GARBA JJCA Date of Judgment: 24 NOVEMBER, 2005 Suit No.: CA/L/408/2001

Mortgage – Power of sale – When arises – Statutory notice c – Sections 19(1) and 20 Conveyancing and Law Property Act, 1881 Mortgage – Sale of property – Notice not given – Whether sale vitiated d Mortgage – Sale of property – Purchaser buying in good faith – Effect – Section 21 Conveyancing and Law of Property Act, 1881 e Mortgage – Sales by Auction Law – Effect on mortgagee’s power of sale

Facts f The appellant herein, a banker was the first defendant in the court below with the second and third defendants being an auctioneer and the buyer of the subject matter of the claim respectively. The respondent in this appeal was however the g plaintiff. The plaintiff is resident in Ibadan and the first defendant also carries on business in Ibadan, Oyo State at all times material to the case. Both are parties to contracts of loan and h banking advances. The plaintiff is a director of a company called Rasamin Industries Ltd and a customer of a personal current account no. 1729 with the first defendant’s branch in Mokola, Ibadan. The said company also holds a separate i current account with the said same bank. Sometime in 1981, the plaintiff executed a deed of legal mortgage over her, the plaintiff’s, house at no.16 Ajileye Street, Bariga, Lagos to serve banking credit and j facilities given to Rasamin Industries Ltd. The deed was

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216 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) dated 11 May, 1981 and registered as no. 19 at page 19 in a Volume 1829 tendered as Exhibit “P3” and reproduced at pages 33 to 41 of the record of appeal. Consequently, the money due on the company’s account was duly repaid but a b release or discharge was not made of the legal mortgage. The reason for the refusal of release was based on an allegation by the appellant that subsequent to the repayment of the first mortgage, that the plaintiff had again agreed to c using the same mortgaged property to secure the account of another company called Niks Travels Ltd (yet another customer of first defendant at the same branch). The Chief Promoter and Managing Director of this latter company is one Mrs Adenike Giwa, a daughter of the plaintiff; the latter d company holds a current account no. 4427 with a loan account no. 364 opened at same first defendant’s Mokola Branch, Ibadan. The appellant further alleged that in documentation of the latter contract of loan and security, the e plaintiff wrote a letter dated 17 September, 1984 (admitted as Exhibit “D11” at page 285 of the record) and later executed a contract of guarantee as well as a memorandum of deposit both dated 26 March, 1985. f That sometimes by 1987 Niks Travels Ltd had defaulted and first defendant in seeking to recover the money due, did set out to sell the plaintiff’s said landed property. g The plaintiff in reacting to the proposed sale filed an action in Suit No. 1/779/88 in the High Court of Oyo State, Ibadan and claimed against the first defendant (as the only defendant in that case) for a declaration that the first h defendant is not entitled to exercise any power of sale as mortgagee and for an injunction to restrain the proposed sale. Parties joined issues in their pleadings but the case did not i go on to trial. Both parties agreed to a term of settlement which same was signed and filed in court upon which the court’s judgment was predicated. Both judgment and an enrolled order of court were admitted as part of exhibit “D2” j

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Wema Bank Plc and others v Abiodun 217 a at pages 265 to 268 of the record. Paragraphs 3 and 4 of the terms of settlement states as follows:– “3. The plaintiff shall make monthly installmental payment of b N5,000.00 into the Account No. 364/ 4427 until the debt is finally liquidated. 4. The plaintiff agrees that failure to pay the installments for a period of three (3) months would make the whole debt fall due and the bank will be entitled to sell the mortgaged c property by public or private auction.” That notwithstanding the said terms agreed upon by parties and despite several reminders by the appellant, the plaintiff/ respondent had repeatedly failed to make payments and d consequent upon which the first defendant/appellant instructed the second defendant to sell the property in issue. Same was accordingly sold to the third defendant and as a result of the sale therefore, the plaintiff instituted the action e in Suit No. ID/1731/92 in the court below. The learned trial Judge entered judgment for the plaintiff against the defendants jointly and severally and thereby making several orders on 24 June, 1998. Being dissatisfied f with the said judgment, the first defendant immediately and on 30 June, 1998 commenced this appeal. The provision of section 21(1) of the Conveyancing and Law of Property Act, 1881 applicable in Lagos State is g relevant and states:– “Where a conveyance is made in the professed exercise of the powers of sale conferred by this Act, the title of the purchaser shall not be impeached on the ground that no case has arisen to authorise the sale or that due notice was not given or that the h power was otherwise improperly or irregularly exercised but any person damnified by an unauthorised or improper or irregular exercise of the power shall have his remedy in damages against the person exercising the power”. i Held – 1. Generally in Lagos State, a mortgagee’s power of sale arises immediately a mortgage debt becomes due but that power is not exercisable until statutory notice of j three months has been given. This is provided for by the

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provision of sections 19(1) and 20 Conveyancing and a Law of Property Act, 1881. On the authority of Nigerian Housing Dev Society Ltd v Mumuni (1977) NCLR 241, the foregoing requirement may be excluded either b altogether or be varied by agreement of parties per section 19(2) of the same Act. 2. The provision of section 21(2) of the Conveyancing Act, 1881 is to protect a purchaser buying and a mortgagee c selling the mortgaged property in good faith. It cannot be used as an instrument of fraud. It has therefore always been recognized that the right to exercise a power of sale must have arisen before a mortgagee can pass a good d title to the purchaser free from the equity of redemption. In other words, the mortgage debt must have fallen due. Once the mortgage debt has fallen due, even if the stipulated notice to sell the mortgaged property has not been given by the mortgagee to the mortgagor, a e purchaser buying from the mortgagee will acquire an unimpeachable title. 3. It is trite law therefore that where the power of sale has arisen (sic) the stipulated notice has not been given, the f legal effect is an regularity, with the proper remedy in damages against the person exercising the power. It does not therefore warrant the setting aside of the sale. 4. The purpose of Sales by Auction Law as provided from g the explanatory note is “to provide for the licensing of auctioneer and to regulate sales by auction”. It is also plain that the law is not intended to regulate a mortgagee’s power of sale. This is because nowhere in all the h sections of the law is the mention made of mortgages. It follows therefore that a right of action by the mortgagor is not within the scope and wording of the Sales by Auction Law. i 5. In other words, any of such non-compliance by auctioneer therefore cannot affect the right and title of the purchaser. Appeal allowed. j

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Wema Bank Plc and others v Abiodun 219 a Cases referred to in the judgment Nigerian Bank of the North Ltd v Akorede (1995) 1 NWLR (Part 374) b 736 British Bata Shoe Ltd v Melikian (1956) NSCC 91; (1956) SCNLR 321 c Coker v Sanyaolu (1976) 9 – 10 SC 203 Ijale v A-G, Leventis (1961) All NLR 792; (1961) 2 SCNLR 386 Iwuoha v NIPOST (2003) 4 SC (Part 11) 37; (2003) 8 d NWLR (Part 822) 308 Madukolu v Nkemdilim (1962) 1 All NLR 581; (1962) 2 SCNLR 341 Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR e (Part 524) 198 Mark v Eke (2004) 1 SC (Part 11) 1; (2004) 5 NWLR (Part 865) 54 f Ndaeyo v Ogunnaya (1977) 1 SC 11 Ngige v Capital Bancorp Ltd (1999) 7 NWLR (Part 609) 71 Nigerian Housing Dev Society Ltd v Mumuni (1977) NCLR 241 g Oguchi v FMB Nigeria Ltd (1990) 6 NWLR (Part 156) 330 Okolo v Union Bank (2004) 1 SC (Part 1) 1; (2004) 3 NWLR (Part 859) 87 h Okwunakwe v Opara (2000) 14 NWLR (Part 687) 334 Osolu v Osolu and others (2003) 6 SC (Part 1) 1; (2003) 11 NWLR (Part 832) 608 Standard Bank Nigeria Ltd v Ikomi (1972) 1 All NLR (Part i 1) 4

Foreign Bassil v Honger 14 WACA 569 j Bell v Holmes [1956] 3 All ER 449

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Bradlaugh v Clarke (1883) 8 APP case 354 a Fidelitas Shipping Co Ltd v V/O Exportchleb (1966) 1 QB 630 d 640 b Henderson v Henderson (1843) 3 Hare 104; 67 ER 313 Hunter v Steward (1861) 4 De G.F.& J 168; 45 ER 1148 Knowles v Roberts (1888) 38 Ch D 263 Lord Denning in Macfoy v UAC (1962) AC 152 c Ord v Ord [1923] 2 KB 432 Philips v Britannia Hygienic Laundry Co Ltd [1923] 2 KB 832 d Plymouth Corporation v Hurrell (1869) 20 LT 473; (1968) 1 QB 455 Thoday v Thoday (1964) P 181; [1964] 1 All ER 341 e Nigerian statutes referred to in the judgment Constitution of the Federal Republic of Nigeria, 1979, sections 219, 236, 239 f Constitution of the Federal Republic of Nigeria, 1999, sections 70, 240 Conveyancing and Law of Property Act, 1881 (applicable to Lagos State), section 21 g Sales by Auction Law of Lagos State, sections 19, 20, 21

Nigerian rules of court referred to in the judgment h High Court of Lagos State (Civil Procedure) Rules, 1994, Order 2 rule 1 High Court of Oyo State (Civil Procedure) Rules, 1988, Order 10 rule 1 i Counsel For the appellants: Odujinrin For the respondent: Awolade j

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Wema Bank Plc and others v Abiodun 221 a Judgment OGUNBIYI JCA: (Delivering the lead judgment) The appellant herein, a banker was the first defendant in the b court below with the second and third defendants being an auctioneer and the buyer of the subject matter of the claim respectively. The respondent in this appeal was however the plaintiff. c Briefly and as a background history of this case, the plaintiff is resident in Ibadan and the first defendant also carries on business in Ibadan, Oyo State at all times material to the case. Both are parties to contracts of loan and banking d advances. The plaintiff is a director of a company called Rasamin Industries Ltd and a customer of a personal current account No. 1729 with the first defendant’s branch in Mokola, Ibadan. The said company also holds a separate e current account with the said same bank. Sometimes in 1981, the plaintiff executed a deed of legal mortgage over her, the plaintiff’s, house at no.16 Ajileye Street, Bariga, Lagos to serve banking credit and facilities f given to Rasamin Industries Ltd. The deed was dated the 11 May, 1981 and registered as No. 19 at page 19 in Volume 1829 tendered as Exhibit “P3” and reproduced at pages 33 to 41 of the record of appeal. Consequently, the money due on g the company’s account was duly repaid but a release or discharge was not made of the legal mortgage. The reason for the refusal of release was based on an allegation by the appellant that subsequent to the repayment of the first mortgage, that the plaintiff had again agreed to using the h same mortgaged property to secure the account of another company called Niks Travels Ltd (yet another customer of first defendant at the same branch). The Chief Promoter and Managing Director of this latter company is one Mrs i Adenike Giwa, a daughter of the plaintiff; the latter company holds a current account no. 4427 with a loan account No. 364 opened at same first defendant’s Mokola Branch, Ibadan. The appellant further alleged that in j documentation of the latter contract of loan and security, the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 222 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) plaintiff wrote a letter dated 17 September, 1984 (admitted a as exhibit “D11” at page 285 of the record) and later executed a contract of guarantee as well as a memorandum of deposit both dated 26 March, 1985. b That sometime by 1987 Niks Travels Ltd had defaulted and first defendant in seeking to recover the money due, did set out to sell the plaintiff’s said landed property. The plaintiff in reacting to the proposed sale filed an c action in Suit No. 1/779/88 in the High Court of Oyo State, Ibadan and claimed against the first defendant (as the only defendant in that case) for a declaration that the first defendant is not entitled to exercise any power of sale as d mortgagee and for an injunction to restrain the proposed sale. Parties joined issues in their pleadings but the case did not go on to trial. Both parties agreed to a term of settlement e which same was signed and filed in court upon which the court’s judgment was predicated. Both judgment and an enrolled order of court were admitted as part of exhibit “D2” at pages 265 to 268 of the record. Paragraphs 3 and 4 of the f terms of settlement states as follows:– “3. The plaintiff shall make monthly installmental payment of N5,000.00 into the Account No. 364/ 4427 until the debt is finally liquidated. g 4. The plaintiff agrees that failure to pay the installments for a period of three (3) months would make the whole debt fall due and the bank will be entitled to sell the mortgaged property by public or private auction.” h That notwithstanding the said terms agreed upon by parties and despite several reminders by the appellant, the plaintiff/respondent had repeatedly failed to make payments and consequent upon which the first defendant/appellant instructed the second defendant to sell the property in issue. i Same was accordingly sold to the third defendant and as a result of the sale therefore, the plaintiff instituted the action in Suit No. ID/1731/92 in the court below. The writ of summons was taken out on 21 July, 1992 wherein the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 223 a plaintiff claimed as per paragraph 32 of her amended statement of claim dated 12 October, 1994 against the three defendants as follows:– b 1. A declaration that the purported sale to the third defendant by the first and second defendants of the house and landed property of the plaintiff situate lying and more particularly described in one deed of c conveyance registered as No. 27 at Page 27 in Volume 1477 of the Lands Registry in the office at Lagos is null and void and should be set aside. 2. A declaration that the first defendant by itself or its d servants or agents including the second defendant are not entitled in law or in equity (whether under any instrument of mortgage or otherwise whatsoever) to exercise any power of sale of the plaintiff’s said landed property. e 3. A declaration that the purported auction sale notice published in the “Sunday Herald” of 26 April, 1992 at page 15 is null and void, illegal and not in conformity with the provisions of Sale by Auction Law Cap. 126 f Volume VI Laws of Lagos State, 1973. 4. That an account be taken of all rents received by the defendants from the date of the purported sale of the property in question to the third defendant until the g FINAL determination of this suit and immediate payment of same to the plaintiff. 5. N1,000,000 (One Million Naira) special and general damages for denying the plaintiff access to and the use h of her personal properties kept in one of the six flats and for trespass, wrongful and illegal auction of the plaintiff’s landed property situate lying and being at No. 16 Ajileye Street, Bariga, Lagos State. i 6. An order of perpetual injunction restraining the defendants by themselves, their agents, servants or privies from interfering with the plaintiff’s peaceable and lawful possession and enjoyment of the said j property.

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It is pertinent to state that the first and second defendants by a their amended statement of defence at pages 105 – 109 of the record had the following to say at paragraphs 10(3) and 11 among others: b “10(3). The plaintiff is not entitled to the reliefs sought in this suit. 11. In the premises, defendants state that plaintiff’s action is an abuse of the process of court and should be dismissed with c costs.” It is also relevant to restate that at page 178 of the record, it is clearly stated that the third defendant neither entered an appearance nor did he file any statement of defence in the d action. While the plaintiff testified on her behalf and tendered exhibits “P1”–“P3”, the first and second defendants called only one witness and also tendered exhibits “D1” – “D18”. At the end of the day and having considered the case for both parties, the learned trial Judge entered judgment for e the plaintiff against the defendants jointly and severally and thereby making several orders on 24 June, 1998. Being dissatisfied with the said judgment, the first defendant immediately and on 30 June, 1998 commenced this appeal. f With the leave of the Court having been sought and obtained the appellant has filed an amended notice of appeal containing six grounds and filed on 22 October, 2002. Briefs of arguments were settled by parties in accordance g with the rules of this court. While the appellants brief was dated 8 April, 2003, it was however deemed filed and served on 9 April, 2003 pursuant to an order of court sought and obtained on the said 9 April, 2003. The respondent also filed h a brief dated 15 March, 2005 which same was deemed filed and served on the same date also pursuant to an order of court obtained the said same date. The appellant further filed a reply brief dated and filed 22 March, 2005. From the said i amended notice and grounds of appeal, the appellant has distilled four issues for determination as follows:– 1. Whether by virtue of Order 10 rule 1 of the High Court of Oyo State (Civil Procedure) Rules, 1988 or at all the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 225 a High Court of Oyo State lacks jurisdiction to hear or determine the previous suit; or whether if that court has jurisdiction, the court below is competent to nullify the b decision in the previous suit. 2. Whether, regardless of any difference in the cause of action in a previous proceeding and a subsequent one, a party is not estopped from contending in a subsequent c action the contrary of any point of law or of fact which, having been distinctly put in issue in a previous proceeding, has been decided against him. 3. Whether the plaintiff is entitled to three months’ notice d or at all of intention to sell the mortgaged property or whether failure to give such a notice is a sufficient ground to set aside the sale made. 4. Whether a breach of an auctioneer’s duty to give e notice(s) required under sections 19, 20 and 21 of the Sales by Auction Law of Lagos State confers a civil right of action against the auctioneer or mortgagee for damages or for setting aside of a sale made in exercise of f a mortgagees power of sale. On behalf of the respondent, three issues were formulated by her Counsel in response to the appellant’s brief of arguments and the issues are as follows:– g 1. Whether there is a valid deed of legal mortgage between the respondent and the first appellant to enable the first appellant to exercise its power of sale with specific reference to the respondent’s landed property which h situate, lying and being at No. 16, Ajileye Street, Bariga, Lagos State, the subject matter of this suit. 2. Whether the setting aside of the sale to the third appellant by the second appellant of the respondent’s i landed property which situate lying and being at No. 16 Ajileye Street, Bariga, Lagos State and the nullification of the previous Suit No. 1/779/88 by the lower court has occasioned any miscarriage of justice to warrant the j intervention of this Court.

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3. Whether the doctrine of res judicata is applicable in the a peculiar circumstances of this suit to estop the respondent from instituting this suit in the High Court of Lagos State. b It is significant at this point in time to mention that from the record of appeal before us, the notice of appeal reveal that the three defendants all appeared to be dissatisfied with the judgment of the lower court and indicated their intentions to c appeal. With reference to pages 297–303 however, the two notices of appeal were filed on behalf of the first and second defendants who shared the same Counsel. Furthermore and with specific reference to the amended notice of appeal and d the brief of arguments filed by the same appellants’ Counsel, the impression given is that the only one appellant in this appeal is the first defendant. This is evidenced at page 3 of the appellant’s brief whose treatment of the issues has been e taken serially. The first defendant is therefore the only appellant in this appeal. The appellant’s issue No. 1 relates to whether the court below was competent and therefore had the jurisdiction to f nullify the decision of the High court of Oyo State in a previous suit by virtue of Order 10 rule 1 of the High Court of Oyo State (Civil Procedure) Rules, 1988. Learned Counsel argued that if the court in the previous suit had g properly exercised jurisdiction, then the court below would be incompetent to review the decision of that court, whose judgment should therefore subsists (sic) and ultimate to which the appellant would be entitled to sell the mortgaged h property under and by virtue of the judgment in the said previous suit. That with issues having been joined by parties on the question of jurisdiction learned Counsel stressed the arguments made by both counsel on the position of Order 10 rule 1 of the High Court Rules (supra) and its inapplicability i to the case at hand. That it is the practice of the High Court of Justice in England that applies in the circumstances and by virtue of which the Oyo State High Court has jurisdiction. That the provision of the rule does not apply to j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 227 a question of jurisdiction of a High Court of justice to determine an action relating to land situate outside the court’s territorial jurisdiction. In substantiating his b submission, the learned Counsel noted the said rule with approval and which he argued is in pari materia with various other rules of court amongst which fell for construction in the cases of Ngige v Capital Bancorp Ltd c (1999) 7 NWLR (Part 609) 71; Ndaeyo v Ogunnaya (1977) 1 SC 11 both of which concern actions in tort on the one hand and British Bata Shoe Ltd v Melikian (1956) NSCC 91; (1956) SCNLR 321; which relates to an action for specific performance of a contract on the other hand. That in Ngige d Capital Bancorp Ltd (supra) it was held that the rule of court on proper venue did not apply in the circumstances of the case. Counsel further argued that the question at hand relates to an issue of territorial jurisdiction and not one of e proper venue. That the learned trial Judge was therefore wrong in his conclusion in respect of Order 10 rule 1 of Oyo State High Court (Civil Procedure) Rules, 1988 at page 196 as he did. f Further still that the determination of the territorial jurisdiction of the High Court of Oyo State is not by reference to rules of court but should be either to the Constitution and the law conferring jurisdiction or by g examination of the cause of action. That the High Court of Oyo State is a court of unlimited jurisdiction which was established under section 270 of the Constitution of the Federal Republic of Nigeria, 1999 and under the High Court h Law of Oyo State. That the jurisdiction of the court is therefore with in a territorial limit, and which in general would not extend beyond the territorial bounds of Oyo State. Despite and notwithstanding the foregoing, learned i Counsel opined that the Court is, in addition, conferred with “all the jurisdiction, powers and authorities, which are vested in or capable of being exercised by the High Court of Justice in England” (section 10 High Court Law of Oyo j State). That the Court is also empowered to administer law

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 228 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) and equity “concurrently and in the same manner as they are a administered by the High Court of Justice of England”. And that where there is “any conflict or variance between the rules of equity and of the common law with reference to the b same matter, the rules of equity shall prevail”. (Sections 13 and 15 respectively.) Great emphasis was placed on the authority in the case of British Bata Shoe Ltd v Melikian (supra) which Counsel related the applicable nature of the c principles under our law. Also in his further submission, learned Counsel contended the main question for determination which is, whether the first defendant has a right to sell the house as a mortgagee. d That based on the authority of British Bata Shoe Ltd v Melikian (supra), and upon the equitable principles applied therein, he argued, that the court had jurisdiction in the matter and consequent to which the first defendant was e entitled validly to sell the immovable mortgaged property at Lagos. On the competence of the court below to review a decision of the High Court of Oyo State, the learned Counsel f submitted in the negative once the previous court is properly seized of jurisdiction to hear the action in the previous suit as canvassed herein before. That in the circumstance, it is therefore not open to the court below to review the judgment g of that court on any ground whatsoever. That the High Court of a State is generally a court of unlimited jurisdiction and with power of each being limited to its territorial bounds. That it follows therefore that the High Court of one State h does not form part of the hierarchy of courts for any other state. Further reference was made to section 240 of the 1999 Constitution. In view of the way and manner in which the respondent’s i Counsel argued all the three issues he formulated together, it might in the circumstance be pertinent and more convenient to first of all take all the submissions made by the appellant in respect of the four issues raised. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 229 a The appellant’s second issue therefore relates to the question of estoppel. In other words, the learned Counsel contended that regardless of any difference in the cause of b action in a previous proceeding and a subsequent one, a party is estopped from contending in a subsequent action the contrary of any point of law or of fact which having been distinctly put in issue in a previous proceeding has been decided against him. The learned Counsel in support of his c argument cited the authorities in the cases of Coker v Sanyaolu (1976) 9 – 10 SC 203 at 222 and Standard Bank Nigeria Ltd v Ikomi (1972) 1 All NLR (Part 1) 5. With further reference made to section 54 of the Act that same d “does not speak of the claim, but of the facts directly in issue in the previous case”. This Counsel contended per Bairamian FJ in Madukolu v Nkemdilim (1962) 1 All NLR 581; (1962) 2 SCNLR 341. Further reliance was made on e the various pronouncements made in a number of decided authorities of Fidelitas Shipping Co Ltd v V/O Exportchleb [1966] 1 QB 630 at 640 and Thoday v Thoday (1964) P 181 at 198; [1964] 1 All ER 341.The learned Counsel high- f lighted the necessary pre-requisites before the doctrine could be operational. That on the one hand, the issues may be the same, although the form of action and the marshalling of the parties may be different. On the other hand, the issues may be distinct, though both relate to the same transaction or g property. That the test is to inquire whether the same evidence would support both issues. Learned Counsel urged for a heavy reliance on the earlier authority of the case of Standard Bank of Nigeria Ltd v Ikomi (supra). h In the said case, the respondent in a previous suit had instituted an action against the appellant seeking a declaration that a deed of guarantee and/or charge signed by him in favour of the appellant was void. That the i court however upheld the validity of the documents. In a subsequent action by the appellant, claim was made for specific performance of the respondent’s undertaking given to the appellant to make and execute on demand a valid j legal mortgage. The respondent pleaded that the previous

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 230 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) proceedings had no bearing on the reliefs sought by the a appellant in the subsequent proceedings and that the subject matter of the actions in the respective suits were not the same. In an appeal to the Supreme Court, their Lordships b upheld the contention of the appellant and held that “it was not competent for the respondent to contend in any subsequent proceedings between the parties that the documents were void”. c Learned Counsel further argued that a party cannot raise a claim or defence, which was open to him in the previous proceedings. That he is required to bring forward his whole case on the first occasion. Reliance was made d on the principle of the decision in Ijale v A-G, Leventis (1961) All NLR 792; (1961) 2 SCNLR 386 where the plea of res judicata was held to apply. That regardless of whether or not the cause of action and reliefs sought in e the court below are different from those of the previous proceedings, Counsel opined and specifically outlined and related issues which are common to both proceedings, and that having been settled in the previous proceedings, neither party ought to be allowed to re-assert any of f the separate issues in the subsequent proceedings in the court below. This submission Counsel argued is predicated upon the principles of issue estoppel per rem judicatam. The four common similarities identified are therefore as g follows:– (1) Whether the plaintiff Rasamin Industries Ltd was indebted to first defendant or first defendant had h wrongfully refused to release the property at No. 16 Ajileye Street, Bariga, Lagos. (2) Whether the property at No. 16 Ajileye Street, Bariga, Lagos was later mortgaged by plaintiff to i secure the account of Niks Travel Ltd. (3) Whether plaintiff was an illiterate person or whether she authorised the use of her property at Lagos as security for loan advanced to Niks Travels Ltd. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 231 a (4) Whether the first defendant had legal right to sell the plaintiff’s property at No.16, Ajeleye Street, Bariga, Lagos under and by virtue of a mortgage. b Learned Counsel in the premise therefore re-asserted and urged this Court to set aside the finding and decisions of the court below on any of the foregoing similarities on ground of estoppel (per rem judicatam). c The third issue raised by the appellant relates to whether the plaintiff is entitled to a three month notice or at all of the intention to sell the mortgaged property or and if so whether failure to give such a notice is sufficient ground to set aside d the sale made. In his constructive arguments and submission, the learned appellant’s Counsel re-asserted the first defendant’s power which is exercisable under the judgment in the previous suit. That the said defendant is therefore e under no duty by any stretch of imagination to give either a three months’ notice or the one month notice required in the deed of mortgage. That the issue of notice has no application at all and it may not also be implied. Reference in support f was made to the case of Knowles v Roberts (1888) 38 Ch D 263 at 272. That with the plaintiffs defaulting under the terms of the judgment, the first defendant was entitled to sell. That the power of sale exercised was made in good g faith and consequent to which it ought not be set aside. An authority in support was the case of Okwunakwe v Opara (2000) 14 NWLR (Part 687) 334 at 339 – 340. Reference was also made to section 21(1) of the Conveyancing and Law of Property Act, 1881 which Counsel argued is h applicable in Lagos State. Learned Counsel in his further stance argued that even if the trial court was right that the plaintiff was entitled to notice and the requisite had not been given (which is not the case) the appropriate i remedy ought to be in damages against the first defendant. That the decision setting aside the sale clearly overrides the provision of section 21(1) of the Conveyancing and Law of Property Act, 1881, which the court below has no juris- j diction to do so.

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The appellants issue No. 4 raises a question whether a a breach of an auctioneer’s duty to give notice(s) required under sections 19, 20, 21 and 22 of the Sales by Auction Law of Lagos State confers on a mortgagor a civil right of b action against the auctioneer or mortgagee for damages or for setting aside of sale made in exercise of a mortgagee’s power of sale. The determination of this question, learned Counsel argued must depend on a consideration of the entire c Sales by Auction Law and the circumstances. Cited to buttress the submission was the case of Philips v Britannia Hygienic Laundry Co Ltd [1923] 2 KB 832 at 841 per Atkin LJ. d Counsel in further re-examining the Sales by Auction Law of Lagos State, reaffirmed its intention which is to regulate a mortgagee’s power of sale in the absence of any mention at all of either mortgages, or any allied related ideas e and matters throughout the provisions. That the law prescribes penalty for each breach of the performance of the duties created in specified manners. The case of Philips v Britainia Hygenic Laundry (supra) was again in point. f Learned Counsel also contended and submitted that a breach under the Sales by Auction Law is one not against any individual (as argued above) but against the state who alone can maintain an action thereof. In grounding the support, Counsel cited the case of Bradlaugh v Clarke g (1883) 8 APP case 354. That where in exercise of a mortgagee’s power of sale, there is non-compliance with provisions as to notice required under Sales by Auction Laws, such non-compliance cannot affect the right and title h of the purchaser. An authority to buttress the contention was the case of Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR (Part 524) 198 at 217 and 218 per Adamu JCA. The learned Counsel in the circumstance has urged us to allow i the appeal and thereby set aside the judgment of the court below. In response to the appellant’s brief of arguments, the learned respondent’s Counsel as a preliminary, dwelt on the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 233 a failure of the appellant to formulate an issue in respect of his ground of appeal No. 4. Counsel therefore urged us to deem the said ground as having been abandoned. b The Counsel affirmatively poised that all the issues formulated and argued in the appellant’s brief will become relevant for consideration if and only when the basic issue of the need for the existence of a valid and enforceable contract c has been established between the first appellant and the respondent. In other words, it must first be established that a binding deed of legal mortgage exists between the first appellant and the respondent, to enable the former to enforce d its power of sale against the latter. The learned Counsel copiously submitted the reliance of the appellant on the combined effect of exhibits “D9”, “D10” and “D11” to have created a legal mortgage between the respondent herein in e its favour to secure the facility granted in favour of Niks Travels Ltd. That the appellant actually relied on the same deed of legal mortgage dated 11 May, 1981 previously used to secure the facility earlier granted in favour of another company called Rasamin Industries Ltd which had repaid its f loan but the bank refused to execute a deed of release to formally terminate the existence of the said legal mortgage. The main question raised by the respondent’s Counsel g therefore related to the letter tendered as exhibit “D11”. That is to say whether it was capable of swapping the respondent’s obligations under the facility granted to Rasamin Industries Ltd and secured with the deed of legal mortgage dated 11 May, 1981 (exhibit “P3”) with the alleged h respondent’s obligations as a guarantor of the facility granted to Niks Travels Ltd using the same deed of legal mortgage. Counsel further submitted that as at the time the first appellant first alleged that Niks Travels defaulted, and i threatened to file Suit No. I/779/99 in Oyo State High Court tendered as exhibit “D2”, the first appellant lacked the capacity to carry out its threat. That there was no basis whatsoever for the filing of the said case upon empty threat j by the first appellant.

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That in the subsequent case at the lower court, the learned a trial Judge considered all the issues in his judgment and concluded that the bank had no legal right to sell the plaintiff’s/ respondent’s property in question. That there has been no b appeal against all the specific findings of facts by the trial court. Counsel therefore submitted that the learned trial Judge did exercise his judicial discretion properly by nullifying the previous Suit No. I/779/88 otherwise known as the “Ibadan case” as well as setting aside the purported c auction sale of the respondent’s landed property by the first and second appellants to the third appellant. The respondent’s second issue is whether the nullification of the previous Suit No. I/779/88 and the setting aside of the d sale by auction to the third appel1ant had occasioned any miscarriage of justice to warrant the intervention of this court. In rebuking the conduct of the first appellant, learned Counsel submitted its behaviour as unbecoming of a reput- e able financial institution. That in an appropriate situation the bank could sell a mortgaged property, but that there must however be sufficient documentation to enable its doing so. That in the present case, there was no basis whatsoever for f the first appellant to have sold the respondent’s house whether by public auction or private treaty as contended by the learned appellant’s Counsel. Counsel in support cited the authorities of Osolu v Osolu and others (2003) 6 SC (Part 1) g 1 at 17; (2003) 11 NWLR (Part 832) 608 and Bank of the North Ltd v Akorede (1995) 1 NWLR (Part 374) 736 at 748, wherein this Court quoted an English case with approval to the effect that “. . . if the bank are (sic) at liberty to act (like the first appellant herein) commerce and industry would be h greatly handicapped”. Counsel therefore disqualified the arguments by the learned appellant’s Counsel at pages 15 to 18 of their brief as both misconceived and untenable. That the learned trial Judge at page 222 of the record made i specific findings of facts of the absence of any notice of sale given to the plaintiff. The respondent’s third issue relates to the doctrine of res judicata and in respect of which his Counsel urged us to j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 235 a discountenance the arguments by the appellant’s Counsel. Counsel relied on Lord Denning in Macfoy v UAC (1962) AC 152 at 160 wherein the learned jurist had this to say:– b “. . . the orders being void, there is even no need for an order of the court to set them aside . . . though it is sometimes convenient to have the court declare them to be so.” That this was precisely what the respondent did at the trial c court where she sought specific declaration to set aside the previous Suit No. I/779/88, which the lower court accordingly granted same at pages 199 to 200 of the record. That the basic fact remains that a bank that lacks relevant d document entitling it to sell the property of a principal borrower or his guarantor cannot legally exercise any power of sale. Consequently, Counsel therefore argued that the case of Standard Bank Nigeria Ltd v Ikomi which was cited e by the appellant’s counsel supra will not apply in this case. This conclusion was based on the premise that the Ibadan case was not decided on the issue whether the property in dispute was actually mortgaged to the bank or not. That it f was at the hearing of the Lagos case that the issue of nullity of the alleged mortgage was exposed and resolved by the trial court. Learned Counsel in view of the fundamental defect in the g first appellant’s claim had urged for a disregard of all the arguments of the appellant’s Counsel which were predicated on the existence of a valid and binding deed of legal mortgage which the bank could enforce. Counsel in the final h result had therefore urged for the dismissal of this appeal and to award substantial cost against the appellants. In response to the respondent’s brief of arguments, the learned appellant’s Counsel had further filed a reply brief i wherein he raised an objection to the first issue formulated by the respondent’s Counsel. The learned appellant’s Counsel vehemently submitted that same be discountenanced as not relevant because it did not properly arise for determination j in this appeal with same not formulated from any ground of

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 236 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) appeal. This Court is also urged to decline to consider any a argument on the said issue but to discountenance same. These are therefore the arguments and submissions of Counsel in this appeal. b As a prelude to the determination of the matter before us, I have earlier on stated my observation that there is only one appellant in this appeal. It follows therefore that the reference made by the respondent’s Counsel to several c appellants is disregarded. The next consideration is the effect of the objection raised on the appellant’s reply brief in respect of the respondent’s issue No. 1 upon which arguments have been greatly d canvassed in paragraphs 5.03 to 5.16 of the brief of argument. The issue raised is whether there is a valid deed of legal mortgage between the respondent and first appellant as to enable an exercise of a power of sale by the first e appellant? The determination of the relevance of this issue and its effect has to be resorted to the appellants’ grounds of appeal as per the amended notice of appeal dated 21 October, 2002. f It is trite law that issues in an appeal must arise from and relate to the grounds of appeal. Any issue outside this specification is alien and has no foundational basis. In a plethora of authorities it has been well settled that neither a g party nor a court is permitted to argue or deal with an issue not related to any ground of appeal. The said following authorities cited by learned appellant’s Counsel are relevant – Mark v Eke (2004) 1 SC (Part 11) 1 at 22; (2004) 5 NWLR (Part 865) 54 per Musdapher JSC also the case of Okolo v h Union Bank (2004) 1 SC (Part 1) 1 at 11; (2004) 3 NWLR (Part 859) 87. Tobi JSC further in the case of Iwuoha v NIPOST (2003) i 4 SC (Part 11) 37 at 49; (2003) 8 NWLR (Part 822) 308 also had this to say:– “It is elementary law that issues for determination must be formulated from the grounds of appeal, whether the issues arise from the appellant’s brief or the respondent’s brief.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 237 a It follows therefore that formulation of issues must not and should not under any circumstance whatsoever be framed in the abstract but in concrete terms arise and relate to the b ground filed. Consequently, for the respondent to have either facts or points of law resolved in his favour, it is indispens- able that issues in his brief should properly reflect what facts or law are in dispute in the appeal; that is to say either in the c notice of appeal or in across-appeal or further still in a respondents’ notice as the case may be. There is in the present case neither a cross-appeal nor is there any respondent’s notice as rightly submitted by the appellant’s Counsel. d Having regard to the amended notice of appeal and relating same to the said objected issue raised, same is not an issue distilled or formulated from any of the six grounds of appeal contained there in the said notice. Further still and e with all the grounds raising issues relating to error or misdirection in law they are involving questions of law alone. The issue raised by the respondent apparently involves a question of mixed law and fact. Same is alien to any of the grounds of appeal before us and it is therefore not f relevant as it does not properly arise for determination in this appeal. As rightly submitted by the learned appellant’s counsel therefore the respondent’s issue No. 1 as well as the arguments thereon are all incompetent without foundation g and are accordingly struck out. For the determination of this appeal I will adopt the appellants issues Nos. 2, 3 and 4 but will formulate a different issue No. 1 and also an additional issue No. 5. h The five issues are therefore as follows:– (1) Whether the learned trial Judge was right to have held that the appellant lacked the power of sale or i foreclosure of the plaintiff/respondent’s property situate at No. 16 Ajileye Street, Bariga, Lagos. (2) Whether regardless of any difference in the cause of action in a previous proceeding and a subsequent j one a party is not estopped from contending in a

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subsequent action the contrary of any point of law or a of fact which having been distinctly put in issue in a previous proceedings, has been decided against him. (3) Whether the plaintiff is entitled to three months’ b notice or at all of intention to sell the mortgaged property or whether failure to give such a notice is a sufficient ground to set aside the sale made. (4) Whether a breach of an auctioneer’s duty to give c notice(s) required under sections 19, 20 and 21 of Sales by Auction Law of Lagos State confers a civil right of action against the auctioneer or mortgagee for damages or for setting aside of a sale made in d exercise of a mortgagee’s power of sale. (5) Whether the deductive summary of the appellant’s case is that warranting the intervention of this Court? e The determination of the five issues would be made serially. For the consideration of the first issue, I would at the initial make reference to page 225 of the record of appeal wherein the learned trial Judge among others found and held f as follows:– “. . . the bank had no legal right to sell plaintiff’s property at No. 16, Ajileye Street, Bariga, Lagos by virtue of the legal mortgage exhibit P3, the equitable mortgage exhibits D11 and D10 and the judgment exhibit D2 in the Ibadan case.” g The matter in this appeal is very simple and straightforward and which same had been briefly stated supra. I would further wish to restate that having regard in particular to the h record at pages 265 and 266, the reproduction of the comprehensive terms of settlement between the parties at the High Court of Oyo State in Suit No. I/779/88 is of relevant significance and same which states as follows:– i “Terms of Settlement The parties have agreed the following terms in settlement of this suit– 1. That the plaintiff as at 27.5.89 is indebted to the defendant to the tune of Five Hundred and Fifty-Five Thousand, One j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 239 a Hundred and Five Naira Ninety Two Kobo (N555,105.92k) being loan overdraft granted plus interest. 2. The said loan/overdraft shall attract 10% interest annually b from the date of judgment. 3. The plaintiff shall make monthly instalmental payment of N5,000.00 into the Account No. 364/ 4427 until the debt is finally liquidated. 4. The plaintiff agrees that failure to pay the installments for a c period of three (3) months would make the whole debt fall due and the bank will be entitled to sell the mortgaged property by public or private auctions. 5. On failure of the plaintiff to pay 3 months installments as d aforesaid the interest rate on the loan/overdraft shall revert to 20% per annual. Whereof both parties hereunder agree the above terms be made the judgment of the court in this action dated this 9 June, 1989.” e It is also apparent that both parties did sign to the terms of settlement which was entered as the judgment of the court per the enrolment order made at pages 267 and 268 accordingly. It is further glaring that the parties to the suit at page 265 were Alhaja (Chief) Aminatu Abiodun and Wema f Bank Ltd being the plaintiff and defendant respectively, who are also the same parties to this appeal. It is further evident from the terms of settlement that the parties both did submit themselves to the jurisdiction of the court and there existed g between them some personal obligation arising out of a contract of banking loan secured by the plaintiffs personal guarantee and mortgage of her house at No. 16 Ajileye Street, Bariga, Lagos. The subsequent enrolment of the h judgment of the court which related the plaintiff’s claim is clearly spelt out on the property the subject matter in issue between the parties being a purported mortgage agreement. Having regard and in the light of the terms of settlement i (supra) could it be right and as argued by the respondent that the appellant had no right to sell the respondent’s house as a mortgagee? It is pertinent to restate that by the nature of the terms entered, the plaintiff had compromised the dispute, j comprised in the previous suit, giving rise to the terms of

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 240 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) settlement, for a consideration. In other words, she was able a to arrest her property from being sold in consideration of the settlement to offset the loan. It is not in dispute that the plaintiff had therefore admitted the indebtedness and hence b the promise to pay in installments and further authorised the defendant “to sell the mortgaged property” in the event of default. The judgment of court and orders were made according to the terms which were freely agreed upon, c entered into and signed by parties. It is not the plaintiff/ respondent’s case that she was either forced, induced or mislead into signing the terms between them. Further still and by the very act of parties entering an d agreement the effect thereof is to bring into existence an independent case within the existing suit but on different parameter with that of the former. The legal effect of the outcome of the latter case therefore holds to override all e other considerations as it forms the nucleus of a new relationship between the parties. The plaintiff/respondent cannot be allowed to go back on her own undertaking. To do that would amount to reducing the function of the court to a mere instrument of toiling convenience. f Subjecting to court’s jurisdiction is a serious business. Parties therefore are to be wary and cautions (sic) of consequential effects of their undertakings. The provision of g Order 10 rule 1 of the High Court of Oyo State (Civil Procedure) Rules, 1988 cannot on the effect of exhibit “D2” serve a hiding shield to the respondent. The document was her own making being the architect thereof. She has been caught up in her net and cannot now be allowed to eat her h cake and also have it. In the circumstance and without having to belabour the issue, it is my humble opinion that the term of settlement is very much binding between parties. In the event of the i respondent’s failure to pay, paragraph 4 of the term of settlement had given the appellant an open cheque “to sell the mortgaged property by public or private auction”. The mode of sale in my opinion is at the bank’s discretion and j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 241 a prerogative, and has nothing to do with the choice of the respondent, who cannot call it to question. It follows therefore that the resolution of issue No.1 is in b favour of the appellant. In other words, the learned trial Judge greatly erred in holding that the appellant had no right of sale of the plaintiff/respondents property situate at No. 16, Ajileye Street, Bariga, Lagos. c Issue No.2 relates to the doctrine of estoppel and its applicability to the case at hand. At pages 199 to 200 of the record, for instance, the learned trial Judge held and said:– “The issue in the instant case is whether the sale of the property in d the exercise of the bank’s power of sale under the judgment exhibit D2 was valid which is different from the issue in the Ibadan case on whether or not the bank had power of sale. I hold that the judgment exhibit D2 in Ibadan case does not operate as estoppel per rem judicatam to estoppel the plaintiff from e instituting this action.” It is trite law that for the operation of the principle of estoppel the issues must be the same in both proceedings. Wilmer LJ in Thoday v Thoday (1964) an English decision f for instance reaffirmed his stance of the proposition, the determination which would give rise to detailed analysis of the issue sought to be raised as against the previous having regard to the pleadings under challenge as well as the g judgment forming the basis of the challenge. It is a trite principle of law that although in latter litigation, the cause of action between the parties may be different from that contended in previous proceedings, nevertheless, a party is estopped from contending the con- h trary of any point of law or fact which having been distinctly put in issue, has been decided against him. This proposition was well-canvassed in the case of Coker v Sanyaolu (1976) 9 – 10 SC 203 at 222; also the case of Standard Bank i Nigeria Ltd v Ikomi (1972) 1 All NLR (Part 1) 4. The provision of section 54 of the Evidence Act is also of great relevance, and same reproduced states as follows:– “Every judgment is conclusive proof, as against parties and j privies, off acts directly in issue in the case, actually decided by

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the court, and appearing from the judgment itself to be the ground a on which it was based; unless evidence was admitted in the action in which the judgment was delivered which is excluded in the action in which that judgment is intended to be proved.” b Bairamian FJ in Madukolu v Nkemdilim (supra) had the following also to say at page 588 on the interpretation of section 53 now 54 of the Evidence Act (supra):– “The rule of res judicata is derived from the maxim of nemo debet bis vexari pro-eadem causa. It is the causa that matters and a c plaintiff cannot by formulating a fresh claim, re-litigate the same causa. That is why Section 53 of the Evidence Act does not speak of the claim, but of the facts directly in issue in the previous case.” The plaintiffs in that case were debarred by that decision d from claiming a declaration of title in a fresh case based on the same cause of action. It is significant and of note that section 54 of the Evidence Act “does not speak of claim but of the facts directly in issue in the previous case”. e Certain renown jurists of imminent recognition have on the subject also made notable pronouncements which are worthy of adoption. For example Lord Denning MR in the decided authority of Fidelitas Shipping Co Ltd v V/O f Exportchleb (1966) 1 QB 630 d 640 among others had this to say:– “. . . once an issue has been raised and distinctly determined between the parties, then, as a general rule, neither party can be allowed to fight that issue all over again.” g Diplock LJ also in Thoday v Thoday (supra) succinctly laid down among others and said:– “If in litigation on one such cause of action any of such separate issues whether a particular condition has been fulfilled is h determined by a court of competent jurisdiction, either on evidence or on admission by a party to the litigation, neither party can, in subsequent litigation between them on any cause of action which depends on the fulfillment of the identical condition, assert that the condition was fulfilled if the court has in the first litigation i determined that it was not, or deny that it was fulfilled if the court in the first litigation determined that it was.” It would appear apparent from the foregoing laid down legal principles that the salient underlying deduction gives an j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 243 a inclination that on the one hand, the issues may be the same, although the form of action and the marshalling of the parties may be different. On the other hand, the issues may b be distinct though both relate to the same transaction or property. The test however is to inquire whether the same evidence would support both issues. A further relevant and illuminating authority is the ancient c decision in the case of Bell v Holmes [1956] 3 All ER 449. Also in case of Ord v Ord [1923] 2 KB 432, the rule of res judicata has been stated at page 454 and said:– “If the res – the thing actually and directly in dispute – has been d already adjudicated upon, of course by a competent court, it cannot be litigated again.” The following sentence, quoted at page 455 from Hunter v Steward (1861) 4 De G.F.& J 168 at 178; 45 ER 1148 at e 1152 is especially confirmative:– “One of the criteria of the identity of two suits, in considering a plea of res judicata is the inquiry whether the same evidence would support both.” f The case of Standard Bank of Nigeria Ltd v Ikomi under reference (supra) is where in a previous suit the respondent had instituted against the appellant seeking a declaration that a deed of guarantee and or charge signed by him in favour of g the appellant was void. The court however upheld the validity of the documents. In a subsequent action by the appellant claim was made for specific performance of the respondent’s undertaking h given to the appellant (under the documents, previously upheld as valid in the previous suit) to make and execute on demand a valid legal mortgage. The respondent pleaded that the previous proceedings had no bearing on the reliefs i sought by the appellants in the subsequent proceedings. He further contended that the subject matter of the actions in the respective suits were also not the same. The trial Judge held upon submission by Counsel that j the memorandum and charge tendered in support of the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 244 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) appellant’s claim for specific performance were unenforce- a able. On appeal, the appellant’s Counsel argued that the earlier action related to the same documents tendered and marked as exhibits “A” and “B” in the subsequent action. b Furthermore that as the respondent had failed to obtain the declaration sought in the previous suit, that the documents were void, and it would be an abuse of process to allow him re-open the matter challenging the validity of the same docu- c ments again in the subsequent proceedings whether on ground relied upon by him in the earlier case or on any new grounds. Their Lordships of the apex court in upholding the appellant’s contention had this to say at page 14 of the report:– d “It was not competent for the respondent to contend in any subsequent proceedings between the parties that the documents were void.” The learned respondent’s Counsel in his submission argued the inapplicability of the Standard Bank’s case to the issue e at hand on the ground that the Ibadan case was not decided on the consideration whether the property in dispute was actually mortgaged to the bank or not. I would in (sic) that behalf restate that the question whether a valid legal f mortgage existed between parties is not a matter relevant to this appeal. That issue as earlier stated was wrongly formulated and which same was accordingly struck out. The argument by the learned respondents’ Counsel g against the said authority is not tenable therefore. On a further general principle of the wider application of the concept of res judicata, its phenomenal extent is not h short or close circuited. In other words and in practical terms, a party cannot for instance raise a claim or defence which was open to him in the previous proceedings, but is required to lay on the table his whole case on the first occasion. The case of Ijale v A-G, Leventis (supra) was i well-expounded on this proposition wherein it was held as follows:– “I believe I state the rule of the court correctly when I say that, where a given matter becomes the subject of litigation in, and of j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 245 a adjudication by, a court of competent jurisdiction, the court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of the b matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence or even accident, omitted part of their case. The plea of res judicata c applies; except in special cases, not only to points upon which the court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.” d This deduction was per Madarikan JSC in Standard Bank Ltd v Ikomi (supra) at pages 13 and 14 of report, in quoting Wigram C in Henderson v Henderson (1843) 3 Hare 104; 67 ER 313 at 319. e In summary of the analytical and cumulative deductions of the terms of settlement exhibit “D2”, it is easily identifiable that certain facts deduced therefrom are also directly in issue in the subsequent proceedings before the f lower court. In other words, it is no longer in dispute that the plaintiff/ respondent is indebted to the first defendant/appellant in the g sum specified at clause 1 of the term of settlement. Also that the property No. 16 Ajileye Street, Bariga, Lagos was the subject of mortgage between parties, which same was authorised by the plaintiff to serve as security for loan advanced to Niks Travels Ltd. Further still and by the very h nature of clause 4 of the term of settlement, it is not in question that the first defendant had the legal right to sell the property of the plaintiff the subject matter of this appeal, under and by virtue of a mortgage. Exhibit “D2” reproduced i (supra) is very explicit. By virtue of the terms entered into by the parties, freely and without compulsion, it is no longer open in the court below to have adjudicated on the subject matter. This is, and as rightly submitted by the learned j appellant’s Counsel, because the court below no longer had

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA 246 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) jurisdiction to adjudicate thereon. The authority in the case a of Bassil v Honger 14 WACA 569 at 572 is relevant in point. It is my humble view therefore that the doctrine of estoppel applies to this appeal and in respect of which issue b No. 2 is determined in favour of the appellant. The next issue No. 3 is whether the plaintiff is entitled to be given three months’ notice of intention to sell or at all; and whether failure to give such notice alone is sufficient c ground to set as idea sale. On behalf of the plaintiff, it is argued that adequate notice required under Sales by Auction Law of Lagos State is not given, and the court is urged to set aside the sale on that d score. This was the plaintiff Counsel’s argument at the lower court although no such was advanced on the brief before us. The appellant’s Counsel however dwelt at great length on the issue and relevance of notice. In arriving at its findings, e for instance, the court below at page 227 of the record held and said:– “I hold that the sale of the plaintiff’s property at No.16, Ajileye Street, Bariga, Lagos was not in accordance with Sections 19, 20, f 21 and 22 Sales by Auction Law of Lagos State and is therefore null and void.” Generally in Lagos State, a mortgagee’s power of sale arises immediately a mortgage debt becomes due but that the g power is not exercisable until statutory notice of three months has been given. This is provided for by the provision of sections 19(1) and 20 Conveyancing and Law of Property Act, 1881. On the authority of Nigerian Housing Dev h Society Ltd v Mumuni (1977) NCLR 241, the foregoing requirement may be excluded either altogether or be varied by agreement of parties per section 19(2) of the same Act. Having regard to the matter under consideration, reference to clause 7 of exhibit “P3” for instance requires that only i one month notice be given on the original mortgage. The said exhibit was by clause 15 later varied to cover the credit given to Niks Travels Ltd instead of Rasamin Industries Ltd. In the course of documentation of the new arrangement j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 247 a between parties, exhibits “D9”, “D10” and “D11” emerged. The reproduction of “D11” at page 285 of the record for instance would be relevant which same states as follows:– b “The Managing Director, Wema Bank (Nig.) Ltd., Oyingbo, Lagos. Dear Sir, c I hereby wish to transfer my property presently under mortgage to my daughter Mrs. Adenike Giwa for her utilization. I authorise her to take full possession of the document and all a sundry. By so doing, I stand as guarantor for the facilities that she is applying for. d Yours faithfully (Sgd.) Alhaja Aminat Abiodun”. e On the authority of exhibit “P3”, it is apparent that a notice of one month was agreed between parties which same however had been further altered by the terms of settlement filed and the judgment given thereupon per exhibit “D2”. f The document exhibit “D2” is by consent of parties and therefore a compromise of dispute in the previous suit and also of parties’ rights under statute or under the mortgage in question. Significantly therefore and having regard to the said judgment, the question of either statutory notice of three g months or even the one months’ notice initially per exhibit “P3” no longer applied. By the very nature of exhibit “D2” the issue of notice had been done away with. Lord Romilly, in Plymouth Corporation v Hurrell (1869) 20 LT 473; h (1968) 1 QB 455 had this pronouncement to make:– “Prima facie everybody would suppose that a compromise means that the question is not to be tried over again. That is the first meaning of compromise. When I compromise a law suit with my i adversary, I mean that the question is not to be tried over again.” In the same vein, Bowen LJ in his expression also in the case of Knowles v Roberts (1888) 38 Ch D 263 at 272 said:– “As soon as you have ended a dispute by a compromise you have j disposed of it.”

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On the authority of exhibit “D2”, the first moment that the a plaintiff failed to pay the agreed installment in accordance with the term of judgment, the first defendant was entitled to sell. At paragraph 9(12) of the amended statement of b defence at pages 105 – 109 of the record for instance, there was a failure to pay by the plaintiff despite a repeated demand made by the first defendant in accordance with the terms of settlement. In the absence of a denial by the c plaintiff of that averment or rebuttal of the evidence by the defence given thereon, it is deemed that the plaintiff had admitted having not made such payments. It is also significant to note that there is no provision in the judgment exhibit “D2” as to any notice of any sort whatsoever. The d interpretation follows that once plaintiff defaults in payment under the judgment, the first defendant is without more, entitled to sell, because from that moment, payment of any sum less than the whole amount due cannot bar the first e defendant from exercising his right of sale. On the question whether failure to give notice alone (without more) is sufficient ground to set aside a sale, the provision of section 21(1) of the Conveyancing and Law of f Property Act, 1881 applicable in Lagos State is relevant and states:– “Where a conveyance is made in the professed exercise of the powers of sale conferred by this Act, the title of the purchaser shall g not be impeached on the ground that no case has arisen to authorise the sale or that due notice was not given or that the power was otherwise improperly or irregularly exercised but any person damnified by an unauthorised or improper or irregular h exercise of the power shall have his remedy in damages against the person exercising the power.” Oguntade, JCA in Oguchi v FMB Nigeria Ltd (1990) 6 NWLR (Part 156) 330 at 343 also had the following i pronouncements to make:– “The provision of Section 21(2) of the Conveyancing Act, 1881 is to protect a purchaser buying and a mortgagee selling the mortgaged property in good faith. It cannot be used as an instrument of fraud. It has therefore always been recognized that j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 249 a the right to exercise a power of sale must have arisen before a mortgagee can pass a good title to the purchaser free from the equity of redemption. In other words, the mortgage debt must have fallen due. Once the mortgage debt has fallen due, even if the b stipulated notice to sell the mortgaged property has not been given by the mortgagee to the mortgagor, a purchaser buying from the mortgagee will acquire an unimpeachable title.” It follows from the foregoing therefore that the provision of c section 21 of the Conveyancing and Law of Property Act (supra), seeks to protect the mortgagee as well as the purchaser in good faith. In other words, it is significant that the mortgage debt must have fallen due and also that both d mortgagee and the purchaser sold and bought in good faith. In the case at hand, there is no evidence of any fraud or improper exercise imputed upon either the mortgagee or the purchaser. The first defendants/appellant’s power of sale had e also arisen under exhibit “D2”, with paragraph 9(12) of the amended statement of defence very much overwhelming that the mortgage debt had fallen due. It is trite law therefore that where the power of sale has f arisen the stipulated notice has not been given, the legal effect is an irregularity, with the proper remedy in damages against the person exercising the power. It does not therefore warrant the setting aside of the sale. The authority in point is Okwunakwe v Opara (2000) 14 NWLR (Part 687) 334 at g 339-340. As rightly submitted and argued i (sic) the learned appellant’s counsel, to which no contrary argument was advanced by the respondent, even if taken for granted the plaintiff was entitled to notice, (which is not the case at h hand), the appropriate remedy in the circumstance of this case is in damages against the first defendant. The third issue raised therefore is resolved in favour of the appellant. In other words, the plaintiff is in no way i entitled to either three months’ notice or at all of the intention to sell the mortgaged property. I further hold that even if she was (which is not the case), the failure to give such a notice is not a sufficient ground to set aside the sale j made.

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Issue No. 4 like No. 3 was not addressed by the a respondent on her brief of arguments. Same is therefore taken as admitted. The issue of complaint in a nut shell borders on the remedy properly available to a mortgagor b where a sale is made of a mortgaged property by public auction without adequate notice required having been given by an auctioneer prior to the sale. In other words, whether a mortgagor has a right to an action solely on the ground that c an auctioneer has failed to give notice as required. The treatment of the issue relates and calls to question sections 19, 20, 21 and 22 of the Sales by Auction Law of Lagos State. The court below took the view and held that the sale was contrary to the said sections and was therefore null and d void. The learned appellant’s Counsel submitted that the determination of this question must depend on a e consideration of the whole Sales by Auction Law and the circumstances. Atkin LJ for instance in the case of Philips v Britannia Hygienic Laundry Co Ltd [1923] 2 KB 832 at 841 had the following to say:– f “In my opinion, when an Act imposes a duty of commission or omission, the question whether a person aggrieved by a breach of the duty has a right to action depends on the intention of the Act. Was it intended to make the duty one which was owed to the party aggrieved as well to the State, or was it public duty only? g That depends on the construction of the Act and the circumstances in which it was made and to which it relates. One question to be considered is, Does the Act contain reference to a remedy for breach of it? Prima facie if it does that is the only remedy.” h The purpose of Sales by Auction Law as provided from the explanatory note is “to provide for the licensing of auctioneer and to regulate sales by auction”. It is also plain that the law is not intended to regulate a mortgagee’s power i of sale as rightly submitted by the learned appellant’s Counsel. This is because nowhere in all the sections of the law is the mention made of mortgages. It follows therefore that a right of action by the mortgagor is not within the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 251 a scope and wording of the Sales by Auction Law. Upon a critical perusal and analyses of the relevant applicable sections 19, 20 and 21 the deductive intendment is clear that b the law creates duties which are to be performed by auctioneers in favour of the public in general and not in favour of any individual person, or even of an ascertainable class of persons to cover mortgagor for example. It is also c apparent that penalties have been provided for a breach of the said sections. To provide a remedy different from that clearly stated therefore, would be going outside and violating that stipulated. Again, the authority in the case of Philips v Britannia Hygienic Laundry (supra) at 838 is in d point and states:– “The principle that where a specific remedy is given by a statute, it thereby deprives the person who insists upon a remedy of any other form of remedy than that given by the statute, is one which is e very familiar and which runs through the law.” Further still and in the absence of any breach against an individual, the remedy could only lie to the state who alone has the right to maintain an action. This has been f propounded in the ancient English authority of the case of Bradlaugh v Clarke (1883) 8 App case 354. On the effect of the mortgagees non-compliance with provision of notice required under the Act, Adamu JCA g among others held as follows in the case of Majekodunmi v Co-operative Bank Ltd (1997) 10 NWLR (Part 524) 198 at 217 and 218:– “As we have seen under the 2nd issue once the power of sale h arises and becomes exercisable, its improper or irregular exercise will not make the purchaser’s title impeachable . . . The auctioneer in the present case was only invited as an agent or independent contractor of the 1st respondent for the purpose of the auction sale and since it was his field of expertise for which he had acquired a i license to practice, he should be held responsible in damages for any injury suffered by the appellant for his (i.e. auctioneer’s) non- compliance with the Auctioneers Law.” In other words, any of such non-compliance therefore cannot j affect the right and title of the purchaser.

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Further still and at paragraphs 15, 16, 17 and 18 of the a plaintiff’s statement of claim at pages 78 – 84 of the record, it was averred that although the property was alleged for sale by public auction, it was nevertheless “secretly sold”. It b follows without more that with the alleged failure the question of Sales by Auction Law would not rightly apply to the sale as submitted by the learned appellant’s Counsel. The said issue no. 4 is in the circumstance also resolved in c favour of the appellant. The fifth and last issue is whether the deductive summary of the appellant’s case is that warranting the intervention of this court? d The learned respondents’ Counsel submitted a negative view to this issue and firmly argued the lack of basis for the action taken by the appellant as a reputable financial e institution. That in (sic) appropriate situation, the bank could sell a mortgaged property, but only subject to sufficient documentation. Counsel relied on the case of Bank of the North Ltd v Akorede (1995) 1 NWLR (Part 374) 736 at 748 where, in quoting an English case with approval, it was held f thus:– “. . . if the banks are at not liberty to act commerce and industry would be greatly handicapped.” g That the bank ought to have given the respondent a notice before selling her property. Counsel relied on the specific finding of fact by the trial court at page 222 as follows:– “I find as a fact that no notice of sale was given to the plaintiff by h the banks letter exhibits D14 to D17.” Counsel on the premise submitted proper exercise of judicial discretion by the trial court and which he argued did not occasion any miscarriage of justice to warrant the i intervention of this Court. Cited in support was the case of Osolu v Osolu and others (2003) 6 SC (Part 1) 1 at 17; (2003) 11 NWLR (Part 832) 608. He therefore urged this Court not to intervene. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Ogunbiyi JCA Wema Bank Plc and Others v Abiodun 253 a The issue relating to notice has been greatly dealt with supra and which does not further call for deliberation. I would only wish to say that with the deductions and findings b made by the lower court at page 222 of the record reproduced supra, it is certain that his Lordship of the trial court grievously fell into an error by not averting his mind to the effect of the terms of settlement exhibit “D2”, by the c parties. The reliance sought to be made on the case of Bank of the North Ltd v Akorede (supra) does not help the respondent’s case. The said respondent’s counsel seems to have also fallen into the same trap of error by the learned trial Judge. The issue of notice as arrived at supra, does not d avail the respondent. It is also neither relevant nor applicable to the matter at hand. Contrary to the submission advanced by the said learned Counsel therefore, the setting aside of the sale by auction has occasioned a serious miscarriage of e justice to the appellant and warranting the intervention of this Court. The said issue No.5 is also resolved in favour of the appellant. In the result and having regard to the totality of this f appeal before us, same I hold is meritorious and therefore succeeds. The appeal is allowed and the judgment of Honourable Justice A F Adeyinka of the High Court of Lagos State sitting at Ikeja dated 24 June, 1998 in Suit No. g ID/1731/92 is hereby set aside. There shall also be cost awarded to the appellant in the sum of N10,000. h AKAAHS JCA: I read in draft the judgment of my learned brother Ogunbiyi JCA, which dealt with all the issues raised exhaustively. I agree with the conclusion reached that the appeal has merit and should be allowed. I wish to comment i briefly on the judgment of the Oyo State High Court sitting in Ibadan in Suit No. I/779/85 (admitted in evidence as exhibit “D2” in Suit No. ID/1731/92) which was nullified by the High Court of Lagos State. The learned trial Judge found j that the property at No. 16 Ajileye Street, Bariga, Lagos

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State the subject-matter of the Ibadan case was not situated a in Ibadan, not even in Oyo State but at Bariga in Lagos State. Relying on Order 10 rule 1 High Court of Oyo State (Civil Procedure) Rules, 1988 which is in pari materia with b Order 2 rule 1 High Court of Lagos State (Civil Procedure) Rules, 1994, the learned trial Judge held that the High Court of Oyo State sitting at Ibadan lacked jurisdiction under Order 10 rule 1 of the Rules of that court to adjudicate on c the subject-matter of that case situate at No. 6 Ajileye Street, Bariga in Lagos State (See page 197 lines 10 – 14). Order 2 rule 1 of the High Court of Lagos State (Civil Procedure) Rules, 1994 states as follows:– d “All suits relating to land, or any mortgage or charge there on or any other interest therein, or for any injuries thereto, and also all actions relating to personal property distrained or seized for any cause, shall be commenced and determined in the Judicial Division in which the land is situated, or the distress or seizure e took place.” This provision of the High Court (Civil Procedure) Rules notwithstanding, does not give a carte blanche to the High f Court of Lagos State to nullify the judgment of the Oyo State. A judgment can be declared null and void by the court which delivered the judgment or by another court of concurrent jurisdiction within the State or by the Court of Appeal (see sections 219 and 236 of 1979 Constitution). g Section 239 of 1979 Constitution States that:– “The High Court of a State shall exercise jurisdiction vested in it by this Constitution or by any law in accordance with the practice and procedure (including the service and execution of all civil and h criminal processes of the court) from time to time prescribed by the House of Assembly of the State.” Section 3(2) of the Constitution states that:– “Each State of Nigeria named in the first column of Part 1 of the i First Schedule to this Constitution shall consist of the area shown opposite thereto in the second column of that Schedule.” The jurisdiction of the Lagos High Court therefore does not extend beyond the territorial limits of Lagos State. When the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, LAGOS DIVISION) Akaahs JCA Wema Bank Plc and others v Abiodun 255 a cross-border injunction was granted by the Enugu State High Court to determine that the term of office of the Governor of Anambra State had ceased, it was not the High b Court of Anambra State that declared the order null and void but the Court of Appeal. See Ngige v Achukwu (2005) 2 NWLR (Part 909) 123. As was decided in the Ngige’s case by Ogebe JCA at page 143 supra:– c “The High Court can only make an order or issue such writs and give such directions as it may consider appropriate for enforcing or securing the enforcement within the state of any right to which the person who makes the application may be entitled.” It must be emphasized that it was the respondent who d instituted the action before the Oyo State High Court, Ibadan to forestall the sale of her property in Lagos which she had mortgaged to the appellant and it was in the course of the proceedings that the parties reached an agreement leading to e the terms of settlement. The respondent was fully aware that the property was located in Lagos but chose to institute the action in Ibadan. Once the appellant acted pursuant to the terms of settlement and sold the property, an innocent f purchaser for value will acquire good title unless the sale was set aside within the stipulated period as provided in section 50 of the Sheriffs and Civil Process Act. For this and the more detailed reasons contained in the g lead judgment, I also allow the appeal and abide by the consequential orders contained in the judgment.

GARBA JCA: My learned brother Ogunbiyi JCA had given h me a draft of the lead judgment prepared by her before now. For all the reasons given therein, my view is that this appeal is one of merits and deserving of success. I join my learned brother in allowing the appeal and setting aside the i decision of the court below. I also abide by other consequential orders made in the lead judgment. Appeal allowed.

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a Vibelko Nigeria Ltd and another v Nigeria Deposit Insurance Corporation b COURT OF APPEAL, ENUGU DIVISION GALADIMA, ADEKEYE, MIKA’ILU JJCA Date of Judgment: 30 NOVEMBER, 2005 Suit No.: CA/E/183/99

Banking – Loan – Granted to a company – Director of c company – Whether liable for Failed banks tribunal – Veil of incorporation – When to lift – Section 3(3)(b)(ii) Failed Bank Decree No. 18 of 1994 d Facts This is a cross-appeal against the judgment of the Failed Banks (Recovery of Debts and Financial Malpractices in Banks) Tribunal, Enugu Zone I delivered on 12 October, e 1998. The main appeal in the matter was struck out on 16 January, 2002. The cross-appellant was the Nigeria Deposit Insurance Corporation the receiver for Pan African Bank Ltd, a failed bank. It was the applicant before the Failed f Bank Tribunal where it claimed against Vibelko Nigeria Ltd and Chief Ignanus Kogbara as respondents/debtor jointly and severally as follows:– (a) An order of the tribunal for the recovery of the sum g of– (1) N10,012,687.18; (2) N333,612.96. h (b) An order of the tribunal for the payment of N10,346,300.12 at the rate of 21% per annum from 31 July, 1996 and until the judgment debt is liquidated. i The foregoing claim arose out of loans and facilities granted to the first cross-respondent a limited liability company, whose chairman was the second cross-respondent, and loans to second cross-respondent on his personal account which j

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Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 257 a was quite separate and distinct from the account of the first cross-respondent, second cross-respondent was (sic) individual customer of the bank in his own right and name, and also the b chairman of the first cross-respondent company. While the suit was pending, the second cross-respondent fully settled his personal indebtedness arising from the loan and facilities granted him on his personal account. The tribunal was then left with only the claim against the first cross-respondent. c Parties had settled issue for trial and this was as agreed by learned Counsel for both parties, and the appropriate rate of interest applicable to the facilities having regard to the terms and circumstances. Counsel for parties relied on written d submission and documents which were admitted in evidence, fifty six by the cross appellant exhibits “APV1” – “APV56”, and the cross-respondents, three marked “RV1” – “RV3”. The honourable Tribunal gave judgment in the e cross-appellants’ favour for the sum of N10,302,705.46 less the sum of N1,050,000 that had been paid by the second cross-respondent during the course of the trial. It however failed to hold the second cross-respondent liable jointly and f severally with the first cross-respondent for the debt and did not lift the veil of incorporation. The cross-appellant filed a cross-appeal against the portion of the judgment that exonerated the second cross-respondent from liability. g Section 3(3)(b)(ii) of Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Decree No. 18 of 1994 stipulates as follows:– The Tribunal shall in the exercise of its powers under this h Decree:– “(b) Lift the corporate veil of a body corporate, where it is necessary for the purpose of revealing its members who may be– (ii) Liable jointly or severally for the debts owed by the i corporate body to a failed bank”. Held – 1. There is a clear distinction between a company and its j directors and members in terms of corporate liability.

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Upon incorporation of a company it becomes a body a corporate and in the eyes of the law, a person as distinct from its members or shareholders. Therefore a director of an incorporated company cannot be held liable for the b loan granted in favour of the company unless he is either a surety or guarantor of the loan granted to the company. A company is an artificial legal entity which is separate and distinct from its shareholders and directors, or from c the members and organs of the company. 2. The tribunal is therefore only vested with the discretion of lifting the corporate veil of any company wherever it is necessary for the purpose of revealing its members. It d is in the interest of justice that a court or tribunal will lift the corporate veil, it will never be lifted to give a party an advantage in law or as a matter of course. An incorporated limited company is always regarded as a e separate and distinct entity from its shareholders and directors. The consequence of recognising the separate personality of a company is to draw the veil of incorporation over the company. No one is entitled to go f behind the veil. This corporate veil shall however be cracked in the interest of justice. Particularly where the company is used as a mask or sham used by the director to avoid recognition in the eyes of equity, the court must be ready and willing to open the veil of incorporation to g see the characters behind the company in the interest of justice. Since a statute will not be allowed to be used as an excuse to justify illegality or fraud, and once there is clear evidence of fraud or illegality the veil will be h lifted. Appeal dismissed.

Cases referred to in the judgment i Nigerian Adeyemi v Lan & Baker (Nig) Ltd (2000) 7 NWLR (Part 663) 33 j

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Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 259 a Adimora v Ajufo (1988) 3 NWLR (Part 80) 1 A-G of Ondo State v A-G of Ekiti State (2001) 17 NWLR (Part 743) 706 b AIB v Lee and Tee Industries Ltd (2003) 7 NWLR (Part 819) 366 Amadi v NNPC (2000) 10 NWLR (Part 674) 76 c Amokeodo v IGP (1999) 6 NWLR (Part 607) 467; (2001) FWLR (Part 33) 344 Awolowo v Shagari (1979) 6 – 9 SC 51 Awuse v Odili (2003) 18 NWLR (Part 851) 116 d Buhari v Obasanjo (2003) 15 NWLR (Part 843) 236 Buhari v Yusuf (2003) 14 NWLR (Part 841) 446 Co-operative Bank Ltd v Obokhare (1996) 8 NWLR (Part e 468) 579 DB Financial Services Ltd v Adesola (2000) 8 NWLR (Part 668) 170 Ekretsu v Oyobebere (1992) 9 NWLR (Part 266) 438 f FDB Financial Services Ltd v Adesola (2003) 8 NWLR (Part 668) 170 Finnih v Imade (1992) 1 NWLR (Part 219) 511 g Ifezue v Mbadugba (1984) SCNLR 427 Lawal v Oke (2001) 7 NWLR (Part 711) 88 Maximum Insurance Co Ltd v Owoniyi (1994) 3 NWLR (Part 331) 194 h Nwosu v Imo State Environmental Sanitation Authority (1990) 2 NWLR (Part 135) 688 Obijuru v Ozims (1985) 2 NWLR (Part 6) 167 Ogbodu v Quality Finance Co Ltd (2003) 6 NWLR (Part i 815) 147 Onyero v Nwadike (1996) 9 NWLR (Part 471) 231 UBN Ltd v Penny-Mart Ltd (1992) 5 NWLR (Part 240) 228 j UBN v Dawodu (2003) 4 NWLR (Part 810) 287

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Foreign a Re City Equitable Inc Co (1925) CR 407 Re Patrick & Lyon Ltd (1933) Ch 786 b Nigerian statute referred to in the judgment Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Decree No. 18 of 1994, section 3(3)(b)(ii) c

Books referred to in the judgment Company Law and Practice in Nigeria by Olakunle Orojo at page 87 d Modern Practice Journal of Finance and Investment Law Volume 2, No. 1 (1998) page 76 Palmers Company Law Volume 1 (24ed) at page 156 e Counsel For the appellant/cross-respondent: Essien For the respondent/cross-appellant: Efik f Judgment ADEKEYE JCA: (Delivering the lead judgment) This is a cross-appeal against the judgment of the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks g Tribunal, Enugu Zone I delivered on 12 October, 1998. The main appeal in the matter was struck out on 16 January, 2002. The cross-appellant is the Nigeria Deposit Insurance Corporation, the receiver for Pan African Bank Ltd, a failed h bank. It was the applicant before the Failed Bank Tribunal where it claimed against Vibelko Nigeria Ltd and Chief Ignatius Kogbara as respondents/debtor jointly and severally as follows:– i (a) An order of the tribunal for the recovery of the sum of– (1) N10,012,687.18; (2) N333,612.96. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 261 a (2) An order of the tribunal for the payment of N10,346,300.12 at the rate of 21% per annum from 31 July, 1996 and until the judgment debt is b liquidated. The foregoing claim arose out of loans and facilities granted to the first cross-respondent, a limited liability company, whose chairman is the second cross-respondent, and loans to c second cross-respondent on his personal account which was quite separate and distinct from the account of the first cross-respondent. Second cross-respondent was individual customer of the bank in his own right and name, and also the chairman of the first cross-respondent company. While the d suit was pending, the second cross-respondent fully settled his personal indebtedness arising from the loan and facilities granted him on his personal account. The tribunal was then left with only the claim against the first cross-respondent. e Parties had settled issue for trial and this was as agreed by learned Counsel for both parties, and the appropriate rate of interest applicable to the facilities having regard to the terms and circumstances. Counsel for parties relied on written f submission and documents which were admitted in evidence, fifty six by the cross-appellant exhibits “APV1” – “APV56”, and the cross-respondents three marked “RV1” – “RV3”. The Honourable Tribunal gave judgment in the g cross-appellants’ favour for the sum of N10,302,705.46 less the sum of N1,050,000 that had been paid by the second cross-respondent during the course of the trial. It however failed to hold the second cross-respondent liable jointly and h severally with the first cross-respondent for the debt and did not lift the veil of incorporation. The cross-appellant filed a cross-appeal against the portion of the judgment that exonerated the second cross-respondent from liability. Vide pages 221–222 of the record of appeal. Parties settled i records and exchanged briefs in accordance with the rules of the Court of Appeal, 2002. When this cross-appeal was argued, the cross-appellant adopted and relied on the brief filed on 15/5/2000 and the reply brief filed on 11/6/2001. j The cross-respondent relied on the brief filed on 11/6/2001.

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The cross-appellant in its brief formulated two issues as a follows:– “(1) Whether or not the learned chairman was right to have gone outside issues settled by the parties for which evidence was b proffered and to which she was addressed on and to consider issues not settled by the parties thereby exculpating the 2nd cross- respondent. (2) Whether or not the learned chairman was right exculpating the 2nd cross-respondent from liability for the debts of the c 1st cross-respondent when from Section 3(3)(b)(ii) of the Failed Banks Decree a mandatory obligation was placed on the tribunal to lift the veil of in corporation of the 1st appellant.” d These issues are related to the four grounds of appeal filed by the cross-appellant. Vide pages 223–224 of the record. The cross-respondent settled three issues as follows:– e (i) Whether on the available evidence before the tribunal, the second cross-respondent to the cross- appeal ought to be held responsible for the indebtedness of the first cross-respondent in this f case. (ii) In what circumstance will the provisions of section 3(3)(b)(ii) of the Failed Banks Decree be invoked to lift the veil of incorporation? g (iii) Are those circumstances available in the case under appeal having regard to the proved facts before the Honourable Tribunal? As the issues distilled by both parties in this cross-appeal are h similar, I shall adopt the issues formulated by the cross- appellant for the purpose of this appeal. The first issue for determination is, whether or not the learned Tribunal Chairman was right to have gone out- i side the issue settled by the parties for which evidence was proffered and to which she was addressed on, to consider issues not settled by the parties, thereby exculpating the second appellant from liability. The cross-appellant j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 263 a submitted that the pronouncement of the learned chairman on the second cross-respondent and all other issues not settled by the parties amounted to formulating issues for the b parties despite the fact that the only issue in controversy had been settled. Issues in the matter were settled in accordance with the rules of court, Order 30 of the Federal High Court (Civil Procedure) Rules, 1976 applicable to the tribunal by virtue of the Failed Banks Tribunal Decree, whereas the c only issue for determination as settled by the parties was:– “What is the appropriate interest rate applicable to the overdraft facility granted to the respondent/debtor by the nature of the terms and circumstances surrounding the facility.” d All other issues were deemed admitted including the liability of the second cross-respondent for the debts of the first respondent. The second cross-respondent did not owe any debt in his personal capacity, leaving only the debt owed by e the first cross-respondent. The learned trial Judge failed to advert his mind to the fact that there was no claim against the second cross-respondent in his personal capacity. By exonerating the second cross-respondent from liability, the f chairman went outside the issues settled for trial and formulated new issue for the parties suo motu. The tribunal’s decision should have been restricted to the applicable interest rate with the second cross-appellant being liable, g jointly and severally for the debt having been made a necessary party to the suit. The cross-appellant cited the cases of Maximum Insurance Co Ltd v Owoniyi (1994) 3 NWLR (Part 331) h 194; Nwosu v Imo State Environmental Sanitation Authority (1990) 2 NWLR (Part 135) page 688 at 729; Obijuru v Ozims (1985) 2 NWLR (Part 6) 167; Adimora v Ajufo (1988) 3 NWLR (Part 80) 1 at 12. i The cross-respondent replied that there was no evidence against the second cross-respondent to warrant his being held liable to pay the debt of the first cross-respondent. From the state of pleadings they had effectively joined j issues with the cross-appellant on the ground of joint

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 264 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) liability, as to the liability of the second cross-respondent as a a guarantor of the loan to the first cross-respondent. Courts are bound to decide only on the case as formulated on the pleadings. In the course of proceedings, the tribunal raised b the issue of the second cross-respondent’s guarantorship of the first cross-respondent’s facility as it arose from the parties pleadings and accorded the parties thereof opportunity to advance arguments on the issue based on the c evidence before the court vide page 204 of the record. Conclusion that there was no evidence before it to show that the second cross-respondent guaranteed the loan of the first cross-respondent was a finding of fact of the court which an appellate court will be very reluctant to interfere with. The d name of the second cross-respondent remained in the suit because he was part of the original claim, but settled his liability when the suit was pending. Finnih v Imade (1992) 1 NWLR (Part 219) 511; Ekretsu v Oyobebere (1992) 9 e NWLR (Part 266) 438. The second issue is whether or not the learned Chairman was right in exculpating the second cross-respondent from liability for the debts of the first cross-respondent when from f section 3(3)(b)(ii) of the Failed Banks Decree, a mandatory obligation was placed on the tribunal to lift the veil of incorporation of the first cross-respondent. Both parties agreed that the second cross-respondent was the chairman, g director and shareholder of the first cross-respondent, and that he negotiated all the facilities granted by the first cross- respondent. The second cross-respondent signed 23 out of the 24 letters written by the first cross-respondent to the h cross-appellant and this prompted the cross-appellant to continue to give them overdrafts. It is clear from the letters that the second cross-respondent did not distinguish himself from the first cross-respondent. The learned tribunal chairman was wrong to hold that the guarantee forms should i have been tendered by the cross-appellant. Since the tribunal found that there had been virtually no credits but only withdrawals on the account, the interest of justice demands that he will not be allowed to hide behind the veil of j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 265 a incorporation, the tribunal should have invoked section 3(3)(b)(ii) of the Failed Banks Decree. The literal interpretation of the word “” in the statute imposed a mandatory b obligation on the tribunal to lift the veil of incorporation in the interest of justice and to hold the second cross- respondent liable, jointly and severally for the debts having found as a fact that the second cross-respondent negotiated all the facilities which started in 1979. c The cross-respondent replied that there is no mandatory provision in section 3(3)(b)(ii) of the Failed Banks Decree, as the court is allowed to exercise its discretion under that d section. The law has provided for situation (sic) which the court may have to lift the corporate veil of a company both at common law and in the statutes and they are principally where illegality and fraud is discernible from the activities e of the individual members of the company. In the absence of any such evidence of fraud or illegality the court will not exercise its discretion of lifting the corporate veil as such will not be necessary as contemplated under section 3(3)(b)(ii) of the Failed Banks Decree. The section will be f invoked against a director who receives money by way of loan for the execution of a contract or other project with intent to defraud fails to apply the money for the purpose for which it was received. g The corporate veil cannot be lifted to give the other litigant an advantage at law. That section cannot be interpreted to import what the legislature does not intend, to h derogate from the legal principle of separate corporate entity for a limited liability company. The cross-appellant have (sic) failed to adduce any evidence of fraud or illegality against the second cross-respondent vis-à-vis the loan transaction. As to the interpretation of the word “shall” in i the provision, it shall be read together with the rest of the provisions therein and will show that is directory in nature and not mandatory. It is permissive in essence as the tribunal must first be satisfied that it is necessary to lift the veil j before exercising its discretion as given to it by the decree.

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The cross-respondent concluded that it will defeat the spirit a of corporate legal practice if the corporate veil were to be lifted as a matter of course. The honourable Tribunal found as a fact that there was no proof that the second cross- b respondent guaranteed the loan to the first cross-respondent. The cross-respondent cited cases and referred to legal books as follows: Amokeodo v IGP (1999) 6 NWLR (Part 607) 467; (2001) FWLR (Part 33) 344 at 347; FDB Financial c Services Ltd v Adesola (2000) 8 NWLR (Part 668) 170 at 174; Re Patrick & Lyon Ltd (1933) Ch 786 at 790; Re City Equitable Inc Co (1925) CR 407; Modern Practice Journal of Finance and Investment Law Volume 2, No. 1 (1998) page 76; Company Law and Practice in Nigeria by Olakunle d Orojo page 87; Palmers Company Law Volume 1 (24ed) at page 156. I have carefully considered the argument and submission of the cross-appellant and cross-respondents on the two e issues for determination. I shall consider them as argued by the parties. The bone of contention in issue number one is whether the honourable Tribunal was right to have pronounced upon and exonerated the second cross- f respondent from liability in respect of the indebtedness of the first cross-respondent to the cross- appellant thereby going outside the issue settled by the parties in their pleadings. Before the tribunal, parties filed and exchanged g pleadings. It is trite that issues between parties are tried on their pleadings and the parties are bound thereby, while the courts are, like the parties, bound to decide on issues as formulated h (sic) the parties in their pleadings. In the h consideration of any issue raised for determination of this Court being an appellate court, is bound by the evidence on printed record. From the state of pleadings before the honourable Tribunal parties joined issues in their pleadings regarding the joint liability of the cross-appellant and cross- i respondent. Vide page 3 of the record paragraphs 6.12 and 6.18. Amended cross-respondents reply at page 195 of the record paragraph 5(d). Address of Counsel to the applicant under the caption, “Is the 2nd cross-respondent/debtor liable j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 267 a vide pages 174 – 175 of the record”. At page 203, the honourable Tribunal asked “What of the guarantee of the 1st cross-respondent’s facility by second cross-respondent b denied in paragraph 5(d) of the reply”? Both parties addressed the court on this issue thereafter. Vide pages 203-205 of the record. In the findings of the honourable Tribunal, the chairman held inter alia:– c “Before concluding, the position of the 2nd respondent must be made clear. In the applicants (sic) application, the 2nd respondent was named as the guarantor of the facilities. There is no evidence of this before the tribunal. d It is for this reason judgment shall be entered only against the 1st respondent, the account holder which is a limited company.” I have read the record over and over, and I hold that the foregoing conclusion of the honourable Tribunal cannot be e faulted. I see nowhere in the records or more important in the evidence of the cross-appellant where it can show any evidence of document of guarantee or bond executed by the second cross respondent in favour of the first respondent. In short the honourable tribunal did not entertain any issues f outside those formulated or on which parties joined issues on their pleadings. UBN v Dawodu (2003) 4 NWLR (Part 810) 287; Lawal v Oke (2001) 7 NWLR (Part 711) 88; Onyero v Nwadike (1996) 9 NWLR (Part 471) 231. g There is a clear distinction between a company and its directors and members in terms of corporate liability. Upon incorporation of a company it becomes a body corporate and in the eyes of the law, a person is distinct from its members h or shareholders. Therefore a director of an incorporated company cannot be held liable for the loan granted in favour of the company unless he is either a surety or guarantor of the loan granted to the company. A company is an artificial i legal entity, which is separate and distinct from its shareholders and directors, or from the members and organs of the company. Ogbodu v Quality Finance Co Ltd (2003) 6 NWLR (Part 815) 147; Co-operative Bank Ltd v Obokhare j (1996) 8 NWLR (Part 468) 579; AIB Ltd v Lee & Tee

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Industries Ltd (2003) 7 NWLR (Part 819) 366; UBN Ltd v a Penny Mart Ltd (1992) 5 NWLR (Part 240) 228. The first issue is resolved in favour of the second cross- respondent. b In the second issue this court is to decide whether or not the learned Chairman was right in exculpating the second cross-respondent from liability for the debts of the first cross-respondent when from section 3(3)(b)(ii) of the Failed c Banks Decree a mandatory obligation was placed on the tribunal to lift the veil of incorporation of the first cross- respondent. d I have condoned the finding of the honourable Tribunal exonerating second cross-respondent from liability in respect of the debt incurred by the first cross-respondent, a limited liability company, as there was no adequate evidence in support of gauranting (sic) such debts. I shall proceed to e consider the effect of section 3(3)(b)(ii) of the Failed Banks Decree No.18 of 1994 on the relationship of the cross- respondents, the second cross-respondent being Chairman, Director and Shareholder of the first cross-respondent vide f pages 1–3 and 194 of the record of proceedings. Section 3(3)(b)(ii) stipulates as follows:– The Tribunal shall in the exercise of its powers under this Decree (D):– g “(b) Lift the corporate veil of a body corporate, where it is necessary for the purpose of revealing its members who may be– (ii) Liable jointly or severally for the debts owed by the h corporate body to a failed bank”. Both parties addressed the court on the interpretation of the word “shall” in the foregoing provision of the decree. In the interpretation of a statute, the main object is to discover the i intention of the lawmaker which is deducible from the language used. Once the language of a statute is clear and unambiguous, the court will give an ordinary or literal interpretation to it. The literal construction must be followed j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 269 a unless that would lead to absurdity and inconsistency with the provision of the statute as a whole. The court of law in the exercise of its interpretative jurisdiction must stop where b the statute stops. Awolowo v Shagari (1979) 6 – 9 SC 51; Buhari v Yusuf (2003) 14 NWLR (Part 841) 446; Buhari v Obasanjo (2003) 15 NWLR (Part 843) 236; A-G of Ondo State v A-G of Ekiti State (2001) 17 NWLR (Part 743) 706; c Awuse v Odili (2003) 18 NWLR (Part 851) 116. The entire statute must be read together and not in isolation, in order to arrive at the nature of the obligation imposed on the tribunal from the meaning of the key words d shall and necessary. Ordinarily, the word shall when used in an enactment is capable of bearing many meanings. It may be implying futurity or implying a mandate or direction or given e permission. If it is used in a mandatory sense then the action to be taken must obey or fulfil the mandate exactly. If it is used in the directory sense then the action to be taken is to obey or fulfil the directive substantially. Amadi v NNPC f (2000) 10 NWLR (Part 674) 76; Ifezue v Mbadugba (1984) SCNLR 427. I do not share the view that the word shall in section 3(3)(b)(ii) of the Failed Bank Decree is meant to be g mandatory or imperative hence the word necessary should not have been used in the statute simultaneously. It is my impression that the word shall used in the statute read together with when it is necessary is meant to be permissive h or directive. It is synonymous with “may”. The tribunal is therefore only vested with the discretion of lifting the corporate veil of any company wherever it is necessary for the purpose of revealing its members. It is in i the interest of justice that a court or tribunal will lift the corporate veil, it will never be lifted to give a party an advantage in law or as a matter of course. An incorporated limited liability company is always regarded as a separate j and distinct entity from its shareholders and directors. The

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 270 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) consequence of recognizing the separate personality of a a company is to draw the veil of incorporation over the company. No one is entitled to go behind the veil. This corporate shall however be cracked in the interest of justice. b Particularly where the company is used as a mask or sham used by the director to avoid recognition in the eyes of equity, the court must be ready and willing to open the veil of incorporation to see the characters behind the company in c the interest of justice. Since a statute will not be allowed to be used as an excuse to justify illegality or fraud, and once there is clear evidence of fraud or illegality the veil will be lifted. FDB Financial Services Ltd v Adesola (2000) 8 NWLR (Part 668) 170; Adeyemi v Lan & Baker (Nig) Ltd d (2000) 7 NWLR (Part 663) 33. There was no evidence of intention to defraud or any illegality manifested by the second cross-respondent m (sic) e the transaction with the bank on behalf of the first cross- respondent that would have made it necessary for the chairman of the tribunal to lift the veil of incorporation of the first cross-respondent. The learned chairman of the f tribunal was therefore right in exculpating the second cross- respondent from liability for the debts of the first cross- respondent. The second issue is therefore resolved in favour of the cross-respondent. g In the final analysis, I find no merit in this appeal. It is dismissed accordingly with N10,000 costs in favour of the cross-respondents. h GALADIMA JCA: I have had the advantage of reading in draft the judgment of my learned brother, Adekeye JCA just delivered. I agree entirely for the reasons so lucidly set out in the lead judgment, which I adopt as mine. I too, dismiss this appeal for lacking in merit. I abide by the order for costs i of N10,000 in favour of the cross appellants.

MIKA’ILU JCA: I have had the opportunity of reading in draft the lead judgment just delivered by my learned brother, j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Mika’Ilu JCA Vibelko Nigeria Ltd v Nigeria Deposit Insurance Corporation 271 a OO Adekeye JCA. I agree with the reasons given therein and the conclusion reached thereof. I also dismiss the appeal. I award the same order as to costs as in the leading b judgment. Cross-appeal dismissed.

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a Auto Import Export v Adebayo and others

SUPREME COURT OF NIGERIA ONU, KATSINA-ALU, OGUNTADE, MOHAMMED, OGBUAGU JJSC b Date of Judgment: 16 DECEMBER, 2005 Suit No.: SC/49/1997

Banking – Bills of exchange – Drawer, acceptor and endorser of bills –Liabilities of c Banking – Bills of exchange – Liabilities of parties thereunder – Determination of – Applicable law – Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 d Banking – Bills of exchange – Parties thereto – Who are? – Liabilities of – Section 30 Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 Banking – Bills of exchange – Waiver or renunciation – e Right of a holder under a bill – How done – Section 62 Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990 Banking – Bills of exchange – “Without recourse” endorsed f on bill – Implication of Banking – Guarantee – Discharge of surety – Effect Words and phrases – “Without recourse” – Endorsed on g Bill of exchange – Meaning of

Facts The plaintiff, a Romanian company engaged in the business h of exportation of motor vehicles and spare parts from Romania reached an agreement on 18/10/69 with a company incorporated in Nigeria Continental Motors and Engineering Company Ltd (hereinafter referred to as the “Nigerian buyer”) to sell to the latter various motor vehicles and spare i parts (hereinafter referred to as “the goods”). Written agreements were entered into as to the manner the Nigerian buyer was to pay for the goods. For the purpose of this case, the relevant agreement that was entered into in May, 1971 j

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Auto Import Export v Adebayo 273 a stipulates that the third respondent National Bank of Nigeria would give 100% cover or guarantee to the plaintiff for the credit granted to the Nigerian buyer. It was agreed that 20% b of the value of the goods would be paid for within six months of the delivery of the goods to the Nigerian buyer and the balance of 80% was to be paid within two years of delivery. The balance of 80% was to attract 5% interest per annum. The third respondent on 4/5/71 and 27/6/70 duly c gave to the plaintiff written guarantees for the credit extended to the Nigerian buyer. The appellant shipped goods worth US$9,314,565.58 to the Nigerian buyer. The Nigerian buyer defaulted in its obligation to pay for the goods. d On 2/10/72, an extra-ordinary resolution was passed winding-up the Nigerian buyer. The plaintiff in an effort to recover the value of the goods shipped to the Nigerian buyer from the third respondent under the deeds of guarantee, e instructed its solicitors to wind-up the third respondent bank. Meanwhile, the third respondent appointed the first respondent as the receiver/manager of the Nigerian buyer. In the attempt to avert being wound-up, the third respondent f agreed to pay the sum due to the plaintiff for the goods sold to the Nigerian buyer. The third respondent actually paid a substantial portion of the amount due leaving a balance of $1.7 million. Some of the assets of the Nigerian buyer were g acquired by the second respondent. The assets were worth US $1.7 million. On 20/5/95, a meeting was held between the plaintiffs, first, second and third respondents. A written agreement was reached as to the manner the outstanding h sum of $1.7 million was to be liquidated through the issuance of three bills of exchange. The bills were later issued but not in the manner agreed. The bills were dishonoured upon presentment. The second respondent agreed that it was indebted to the plaintifff for $1.7 million. i In these circumstances, the plaintiff issued its writ of summons claiming against the defendants jointly and severally the sum of N1,089,743.50 being the balance (plus interest) of the price of motor vehicles, spare parts and j machinery.

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The respondents denied the claims. a The defence of the third respondent was that as the three bills of exchange were endorsed by all the parties and sent to the plaintiff in accordance with the terms of the agreement, b exhibit “5”, the third respondent was discharged from further liability to the plaintiff because the bills of exchange were endorsed “without recourse” to the third respondent. c Held – 1. Once a bill of exchange which ex facie fulfils all the essential pre-requisites as stipulated under the Act has come into existence, the determination of the liabilities d of the parties to the bill must be determined as laid down under the Act. The plaintiff/appellant by negotiating the bills in the form in which they were drawn gave them the appearance of bills validly drawn under the law. If e the plaintiff had rejected the bills and insisted that they be drawn in accordance with exhibit “5”, it could not have become an issue in the proceedings that the bills were improperly issued. Having agreed that the bills f were validly drawn by negotiating them, the plaintiff/appellant could not stop the courts below from treating the said bills otherwise than provided under the Bills of Exchange Act. g 2. Under the Bills of Exchange Act, the first and second respondents as drawer and acceptor respectively of the bills should have been held jointly and severally liable to pay the total value of the bills which is US $1.7 million. h There was no basis to exclude the first respondent from liability as the two courts below did. Their liability is as prescribed under sections 54 and 55 of the Bills of Exchange Act above. i 3. The phrase “without recourse” endorsed on a Bill of Exchange conveys to subsequent endorsees and holders in due course that the endorser of such endorsed bill is not liable on the bills. j

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Auto Import Export v Adebayo 275 a In the instant case, the plaintiff/appellant having negotiated the bills, which carried the endorsement “without recourse”, would appear to have accepted that b it had no right of action against the third respondent under the Bills of Exchange Act. The third respondent having negatived its liability on the bills of exchange could not be held liable on said bills. c 4. The phrase “without recourse” endorsed on a bill of exchange used in making a qualified endorsement of a negotiable instrument, signifies that the endorser means to save him self from liability to subsequent holders, and d is a notification that, if payment is refused by the parties primarily liable, recourse cannot be had to him. An endorser “without recourse” specially declines to assume any responsibility for payment. He assumes no e contractual liability by virtue of the endorsement itself, and becomes a mere assignor of the title to the paper, but such an endorsement does not indicate that the endorsee takes with notice of defects, or that he does not take on f credit of the other parties to the note. 5. For a holder of a bill to waive or renounce his right under the bill, the same must be in writing. An oral agreement is not sufficient, let alone a waiver by g conduct. Such a renunciation or such evidence of writing should be that of the holder, in this case, the plaintiff and not that of the third defendant. The fact that the plaintiff on sighting the wrongly drawn bills, presented them to h the bank for payment without an immediate protest that the bills were wrongly drawn, does not and cannot mean that the plaintiff (appellant) has waived or renounced its right as to the mode of issue. i 6. By section 38(2) of the Bills of Exchange Act, a holder in due course can enforce payment against all parties liable on the bill while section 30(1) had made every party whose signature appears on a bill parties to the bill. j Hence, every party whose signature appears on a bill is

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a party to the bill. Thus, in the alternative, the appellant a being a holder in due course can recover the value of the bill from all the respondents jointly and severally, especially from the third respondent if not as drawer b then as a party to the bills. Therefore it goes without saying that the appellant is entitled to be compensated by all the parties to the bills especially the third respondent being the last indorser. The amount of compensation c should be the amount disclosed on the face of the bills, which in this case is N1,700,000. 7. A release of the principal debtor by the creditor will not discharge the surety if he has ceased to be a surety and d become himself a principal debtor, or has previously paid part of the debt and given a security for the remainder, or has, in consideration of an extension of time to himself by the creditor, bound himself without e the principal debtor’s concurrence to pay the whole sum for which he was originally surety only, or has expressly agreed to remain liable, so that there is then no ground for the presumption that he is impliedly discharged. f Appeal allowed.

Cases referred to in the judgment Nigerian g Adebanjo v Brown (1990) 3 NWLR (Part 141) 661 Adegoke Motors Ltd v Adesanya (1989) 3 NWLR (Part 109) 250; (1989) 5 SCNJ 80 Adesanya v Otuewu (1993) 1 NWLR (Part 270) 414 h African Petroleum v Owodunni (1991) 8 NWLR Part 210) 391 A-G, Bendel State v A-G, Federation (1982) 3 NCLR 1 i AIDC v Nigeria Liquified Natural Gas Ltd (2000) 4 NWLR (Part 653) 494; (2000) 2 SCNJ 119; (2000) 2 SC 57 Akpapuna v Nzeka II (1983) 2 SCNLR 1 AP Ltd v Owodunni (1991) 8 NWLR (Part 210) 391 j

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Auto Import Export v Adebayo 277 a Arinze v First Bank of Nig Ltd (2004) 5 SCNJ 183; (2004) 12 NWLR (Part 888) 663; (2004) 5 SC 160 Ariori v Elemo (1983) 1 SC 13; (1983) 14 NSCC 1; (1983) 1 b SCNLR 1 Arubo v Aiyeleru (1993) 3 NWLR (Part 280) 126 Bello v NBN Ltd (1992) 6 NWLR (Part 246) 206 c BON Ltd v Yau (2001) 5 SCNJ 168; (2001) 10 NWLR (Part 721) 408 Boshali v Allied Commercial Exporters Ltd (1961) 2 SCNLR 322 d Carribean Trading & Fidelity Corporation v NNPC (1992) 7 NWLR (Part 252) 161 Chinwendu v Mbamali (1980) NSCC 128 e Eboni Finance & Securities Ltd v Wole-Ojo Technical Services Ltd (1996) 7 NWLR (Part 461) 464 Emegokwue v Okadigbo (1973) 4 SC 113 f Enang v Adu (1981) 11 SC 25 Eze v Okechukwu (2002) 12 SCNJ 258; (2002) 18 NWLR (Part 799) 348 g Ezomo v Oyakhire (1985) 1 NWLR (Part 2) 195 Fadare v A-G Oyo State (1982) 4 SC 1 Fasade v Babalola (2003) 4 SCNJ 287; (2003) 11 NWLR h (Part 830) 26 FATB Ltd v Partnership Investment Co Ltd (2003) 2 SCNJ 1; (2003) 18 NWLR (Part 851) 35 Fawehinmi Construction Co Ltd v Obafemi Awolowo i University (1998) 5 SCNJ 44; (1998) 6 NWLR (Part 553) 171 FCDA v Naibi (1990) 3 NWLR (Part 138) 270 j FHA v Sommer (1986) 1 NWLR (Part 17) 533

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Fortune International Bank Plc v Pegasus Trading Office a (2004) 1 SCNJ 292; (2004) 1 SC (Part11) 164; (2004) 4 NWLR (Part 863) 369 George v Dominion Flour Mill Ltd (1963) 1 SCNLR 117 b Gurara Securities & Finance Ltd v TIC Ltd (1999) 2 NWLR (Part 589) 29 Ibodo v Enarofia (1980) NSCC 195; (1980) 5 – 7 SC 42 c Igwe v AICE (1994) 8 NWLR (Part 363) 459 Laguro v Toku (1992) 2 NWLR (Part 223) 278 Lewis & Peat (NRI) Ltd v Akhimien (1976) 7 SC 157 d Mainagge v Gwamna (2004) 7 SCNJ 361; (2004) 7 SC (Part11) 86; (2004) 14 NWLR (Part 893) 323 Mojekwu v Iwuchukwu (2004) 4 SCNJ 180; (2004) 11 NWLR (Part 883) 196 e Ndayako & Jikantoro v Dantoro (2004) 5 SC (Part 11) 1; (2004) 13 NWLR (Part 889) 187 Niger Construction Ltd v Okugbeni (1987) 4 NWLR (Part 67) 787 f Nwadiaro v SPDC Ltd (1990) 5 NWLR (Part 150) 322 Odua Inv Co Ltd v Talabi (1997) 10 NWLR (Part 523) 1 Ogboru v Ibori, a decision of the Court of Appeal, Benin g Division on 13/7/05 Oladoye v Mil Administrator, Osun State (1996) 12 SCNJ 192; (1996) 10 NWLR (Part 476) 38 h Olatunde v Obafemi Awolowo University and another (1998) 5 NWLR (Part 567) 178; (1998) 4 SCNJ 59 Rean Ltd v Aswani Textile Industries (1991) 2 NWLR (Part 176) 639 i Royal Exchange Assurance (Nig) Ltd v Aswani Textiles Ltd (1992) 3 NWLR (Part 227) 1; (1992) 2 SCNJ 346 Salawal Motor House Ltd v Lawal (1999) 9 NWLR (Part 620) 692 j

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Auto Import Export v Adebayo 279 a Saraki v Kotoye (1990) 4 NWLR (Part 143) 144; (1990) 6 SCNJ 31 Trade Bank Plc v Chami (2003) 13 NWLR (Part 836) 158 b Ume v Okoronkwo (1996) 12 SCNJ 404; (1996) 10 NWLR (Part 477) 133 Usman v Garke (2003) 7 SCNJ 38; (2003) 14 NWLR (Part 840) 261 c Yoye v Olubode (1974) 10 SC 209

Foreign d Charterhouse Credit Co Ltd v Tolly [1963] 2 All ER 432 Fullers Theatre and Vaudeville Co Ltd v Rofe (1923) AC 435 (PC) Karsales (Harrow Ltd) v Wallis [1956] 2 All ER 866 e Lever Brothers Ltd v Bell [1931] 1 KB 557 Matthews v Smallwood (1910) 1 Ch 777 Mc Call Brothers Ltd v Hargreaves [1932] 2 KB 423 f McDonald v Nash (1924) AC 625 National Sales Corporation v Bernardi [1931] 2 KB 188 North-Western Salt Company Ltd v Electro Lytic Alkali Co g Ltd [1913] 3 KB 422 Re George Francis v Bruce (1890) 44 Ch D 627 Re Vandervell’s Trusts No. (2) [1974] 3 All ER 205 h Rimal v Carthwright (1924) WN 229 (CA) Ross T Smith & Co. Ltd v TD Bailey Son & Co [1940] 3 All ER 60 Selwyn v Garfit (1888) 38 Ch D 273 i Serbeh v Karikan (1939) 5 WACA 34 Shaw v Shaw (1954) 2 QB 429 Smyth Ross J & Co Ltd v Banley, Sons & Co [1940] 3 All j ER 60

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State v MCtaque (1927) 173 MIN 153 a Suisse Atlantique Societe D‘armament Maritime SA v N V Rotterdamsche Kolen Centrale (1967) 1 AC 361 b Vivyan v Vyan 30 Beav 65; 54 ER 817

Nigerian statutes referred to in the judgment Bills of Exchange Act Cap 21 Laws of the Federation of c Nigeria, 1958, sections 27(2), 30(1), 30(2), 38(2), 55(2)(a), 55(2)(b); 55(2)(c), 56, 59 – 64, 62, 62(1), 62(2) Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990, sections 16(a), 16(b), 30, 54(a), 54(b)(i), d 54(b)(ii), 54(b)(iii), 55(1)(a), 55(1)(b), 55(2)(c)

Nigerian rules of court referred to in the judgment High Court of Lagos State (Civil Procedure) Rules, 1972, e Order 16 rule 11

Books referred to in the judgment Andrew & Millet Law of Guarantees (1ed) at pages 162 – f 163 Black’s Law Dictionary (5ed) at pages 370 – 371 Black’s Law Dictionary (6ed) at page 1580 g Black’s Law Dictionary (7ed) at page 1574 Byles on Bills of Exchange (23ed) at pages 129, 130, 168 Chitty on Contract Volume 2 (24ed) h Halsbury’s Laws of England (3ed) Volume 14 at paragraph 1175 Halsbury’s Laws of England (4ed) Volume 20 at page 158 paragraph 291 i Jowitts Dictionary of English Law page 253 paragraph 378 Rowlatt on Principal & Surety (3ed) at page 102 Supreme Court Practice 1985 Volume 1 at pages 261 – 262 j

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Auto Import Export v Adebayo 281 a Counsel For the appellant: Sagay b For the second respondent: Delano For the first and third respondents: Ajayi (with him Ajibore and Tebira) c Judgment OGUNTADE JSC: (Delivering the lead judgment) The appellant, a Romanian Company was the plaintiff at the Lagos High Court. It had on 14/11/79 issued its writ of d summons against three defendants claiming for the following:– “The plaintiff’s claim against the defendants jointly and/or severally is for the sum of N1,089,743.50 (U.S.$1,700,000.00) e being the balance of (plus interest) of the price of motor vehicles, spare parts and machinery (hereinafter called ‘The goods’) sold and delivered by the plaintiff in Lagos to Continental Motors and Engineering Company Ltd now under the Management and Receivership of Mr. Basil Adenrele Adu liquidator (herein- f after called the 1st defendant) which said goods were by an agreement between the 1st defendant and the 2nd defendant transferred to the 2nd defendant for reward, the payment of which said sum of N1,089,743.50 (US$1,700,000) having been g guaranteed by the 3rd defendant by virtue of a memorandum in writing dated the 20 May, 1975 been (sic) to balance price of motor vehicles, spare part and machinery – N990,448.00 (US$1,153,500) To interest as 5% per annum up to and including 20/5/75 as agreed h – N99,295.50 (US$1,153,500) = N1,089,743.50 (U.S.$1,700,000) The defendants have refused to pay despite repeated demands, and the plaintiff also claims interests on the said sum of N1,089,743.50 (US$1,700,000) at the rate of 12% per annum from i 3/12/77 until the date of judgment and thereafter at the rate of 6% per annum until the judgment debt and costs have been fully paid.” In the course of the trial before the High Court, the plaintiff j amended its statement of claim, and another defendant,

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Mr JAA Adebayo (now the first respondent) was joined to a the suit as the second defendant. The plaintiff later withdrew its suit against Mr Basil Adenrele Adu, who had at the inception of the suit been sued as first defendant. b Pleadings having been filed and exchanged, the suit was heard by Candide Johnson CJ (of blessed memory). The plaintiff called one witness. The present third respondent who was identified at the trial as the fourth defendant also c called one witness. On 16/7/86, the learned Chief Judge in his judgment concluded thus:– “On the views above held, it is my judgment that the 3rd defendant remains liable to the plaintiff for the payment of the agreed sum of d $1.7 million dollars otherwise N1,089,743.50k as claimed in the writ. I find no case made out against the 2nd and 4th defendants on the claim and the case is dismissed against 3rd defendant in the sum of e N1,089,743.50k with interest at 12% per annum from 2/12/77 until today and thereafter interest at 6% per annum until the judgment debt and interest are fully paid.” It is necessary that I observe here that the second defendant f before the High Court is now described in this appeal as first respondent, the third defendant as second respondent and the fourth defendant as third respondent. This observation becomes necessary in order to align the description of g parties in the High Court with their description in the court below and this Court. The second respondent was dissatisfied with the judgment h of the trial court. It brought an appeal against it. The plaintiff was also dissatisfied. It brought a cross-appeal of its own. The Court of Appeal (Lagos Division) heard the appeal. In its judgment on 1/7/96, the court below struck out the appeal by the second respondent and dismissed the cross-appeal i by the plaintiff. The result was that the judgment of the trial court remained undisturbed. The plaintiff, dissatisfied with the judgment of the court below, has come on a last appeal before this Court. In its appellant’s brief, the issues j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 283 a identified as arising for determination in the appeal are these:– “(1) Whether the appellant had waived its right of recovering the b balance of the debt of $1.7 million and interest from the 3rd respondent and whether the 3rd respondent can validly rely on the defence of waiver where such was not pleaded. (2) Whether upon a proper construction of exhibit 5, the endorsement of the three (3) drafts, exhibits 8, 8A, 8B by the c 3rd respondent was a mere formality or a recognition of the 3rd respondent’s continued indebtedness to the appellant and a duty under the Bills of Exchange Act to pay the said sum of $1.7 million plus interest to the appellant. d (3) Whether upon a proper construction of exhibit 5, the appellant’s right to payment against the 3rd respondent should be determined on the basis of the three (3) irregularly drawn drafts, exhibits 8, 8A and 8B or its further amended statement of claim. e (4) Given the circumstances of this case and upon a proper construction of exhibit 5, whether the words ‘without recourse’ indorsed on the three drafts, exhibits 8, 8A and 8B operate to exclude the 3rd respondent from liability of paying f the sum of $1.7million plus interest given the circumstances of the transaction.” The first and third respondents through their Counsel filed a joint brief wherein the (sic) identified the under mentioned g issue, as arising for determination:– “(1) Whether the appellant, having taken advantage of the two benefits open to it i.e. by accepting the 3 drafts as drawn without protests or rejection (sic) could at a later date h complain that the drafts were wrongly or irregularly drawn. (2) Whether the 2nd respondent as the acceptor of the three bills of exchange is the person primarily liable on the bills as drawn to the appellant? i (3) Was there any further liability attaching to the 1st and 3rd respondents when the 2nd respondent had admitted in writing owing the appellant the entire sum of US$1,700,000.00 US (sic) dollars claimed in the action in its letter dated 12/12/75 pleaded in paragraph 35 of the further j amended statement of claim?

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(4) Whether the phrase ‘without recourse’ inserted in the a agreement exhibit 5 protected both the 1st and 3rd respondents from liability in the sum of US$1,700,000.00.” The second respondent by its Counsel raised one solitary b issue for determination thus:– “Whether the 1st and 3rd respondents have discharged their obligation to pay for goods sold and delivered to the 1st respondent.” c It is appropriate for me to say at this stage that the second respondent against whom the trial court and the court below gave judgment has not appealed to this Court against the judgment of the court below. One would ordinarily wonder d why the plaintiff had pursued this appeal to this Court, since there is in any case a judgment in its favour against the second respondent. The plaintiff in its notice of appeal stated the reliefs being sought from this Court thus:– e “An order setting aside the decision of Court of Appeal dismissing the cross-appeal and entering judgment against the 2nd and 4th defendants jointly and severally for the sum of US$1,700,000.00 (One Million, Seven Hundred Thousand US Dollars) July, 1996 (sic)”. f Since the plaintiff never withdrew its claim against the second respondent and since there is in any case an extant judgment against the second respondent, it is fair to conclude that what the plaintiff seeks by its appeal is a g judgment against all of first, second and third respondents jointly and severally for the sum claimed. The issues for determination raised by the first, second and third respondents are all amply accommodated under h appellant’s issues. I shall therefore be guided by the appellant’s issues. These issues dovetail unto each other. I intend to discuss all four of them together. But before doing so, I intend to examine and expose the pleadings upon which i the suit was tried. The facts pleaded by the parties may be summarised thus:– The plaintiff, a Romanian company engaged in the business of exportation of motor vehicles and spare parts j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 285 a from Romania reached an agreement on 18/10/69 with a company incorporated in Nigeria Continental Motors and Engineering Company Ltd (hereinafter referred to as “the b Nigerian buyer”) to sell to the latter various motor vehicles and spare parts (hereinafter referred to as “the goods”). Written agreements were entered into as to the manner the Nigerian buyer was to pay for the goods. For the purpose of this case, the relevant agreement that was entered into in c May, 1971 stipulates that the third respondent National Bank of Nigeria would give 100% cover or guarantee to the plaintiff for the credit granted to the Nigerian buyer. It was agreed that 20% of the value of the goods would be paid for d within six months of the delivery of the goods to the Nigerian buyer and the balance of 80% was to be paid within two years of delivery. The balance of 80% was to attract 5% interest per annum. The third respondent on e 4/5/71 and 27/6/71 duly gave to the plaintiff written guarantees for the credit extended to the Nigerian buyer. The appellant shipped goods worth US $9,314,565.58 to the Nigerian buyer. The Nigerian buyer defaulted in its f obligation to pay for the goods. On 2/10/72, an extraordinary resolution was passed winding-up the Nigerian buyer. The plaintiff in an effort to recover the value of the goods shipped to the Nigerian buyer g from the third respondent under the deeds of guarantee instructed its solicitors to wind-up the third respondent bank. Meanwhile, the third respondent appointed the first respondent as the Receiver/Manager of the Nigerian buyer. h In the attempt to avert being wound-up, the third respondent agreed to pay the sum due to the plaintiff for the goods sold to the Nigerian buyer. The third respondent actually paid a substantial portion of the amount due leaving a balance of $1.7 million. Some of the assets of the Nigerian buyer were i acquired by the second respondent. The assets were worth US $1.7 million. On 20/5/95, a meeting was held between the plaintiffs, first, second and third respondent. A written agreement was reached as to the manner the outstanding j sum of $1.7million was to be liquidated through the issuance

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC 286 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) of three bills of exchange. The bills were later issued but not a in the manner agreed. The bills were dishonoured upon presentment. The second respondent agreed that it was indebted to the plaintiff for $1.7 million. In these b circumstances, the plaintiff issued its writ of summons claiming as earlier stated. The first and third respondents in their further amended statement of defence denied plaintiff’s claim in particular c they pleaded in paragraphs 2B, 2C, 2D, 4, 7(e) and 8 of the amended statement of defence thus:– “2B. With further reference to paragraphs 26, 27 of the further amended statement of claim, the 2nd and 4th defendants d admit the averment in these paragraphs to the extent that the sum of $1.7 million dollars or (N 1,089,741.50) owing by the 3rd defendant to the plaintiff by the 3rd defendant drawing three drafts on the 3rd defendant Messrs Obikoya & Sons Ltd for– e (a) $500,000.00 due on 1/12/75; (b) $600.000.00 due on 1/12/76; (c) $600,000.00 due on 1/12/77; and These drafts would be accepted by the 3rd defendant and, f returned to the 4th defendant Bank. The plaintiff ‘without recourse’ to the Bank as full and final payment for the balance of all amounts due to the words ‘without recourse’ inserted in the Memorandum of Agreement dated 20 May, g 1975. 2C. With reference to paragraph 37 of the said further amended statement of claim dated 22 December, 1983, these defendants admit paragraph 37 of the statement of claim to the extent that the 3rd defendant failed and refused to make h payment in breach of the Memorandum of Agreement of the 20 May, 1975 while the 2nd and 4th defendants deny categorically any demand by the plaintiff from them the recovery of the said amount of $1.7 million dollars or i 1,089,743.50). 2D. The 2nd and 4th defendants will rely on both legal and equitable defences at the trial of this action especially that these defendants are not liable since the 2nd defendant had transferred all the assets of the Continental Motors and j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 287 a Engineering Company Ltd to the 3rd defendant A. Obikoya & Sons Ltd who have accepted liability to pay the outstanding bills amounting to $1.7million U.S. Dollars or (N 1,089.743.50). b 4. The 4th defendant will contend at the trial that it has discharged its obligations on the Memorandum of Agreement dated 20/5/75 and has no further liabilities to discharge to the plaintiff and the 2nd defendant will also contend that he will c not be liable since he has transferred all assets of Continental Motors Engineering Company Ltd to the 3rd defendant A. Obikoya & Sons Ltd who then accepted liability for the sum of $1.7 million U.S. Dollars in accordance with the agreement dated 20/5/75. d 7(e) The 3rd defendant having accepted the three drafts i.e–– (1) $500,000.00 due on 1/12/75; (2) $600,000.00 due on 1/12/76; and e (3) $600,000.00 due on 1/12/77 drawn by the 2nd defendant and accepted by the 3rd defendant A. O. Obikoya & Sons Ltd and endorsed by the 4th defendant to the Romania Bank without recourse to the 4th defendant denies any liability to plaintiff in the said sum f of $1.7 million dollars interest claimed (N 1,089,743.50) nor in any sum or at all. 8. In further answer to paragraph 33 of the further amended statement of claim, the 4th defendant contends that the said 3 g drafts amount to $1.7 million dollars were regularly drawn in compliance with the provisions of the Memorandum of Agreement dated 20 May, 1975. In the alternative the 2nd and 4th defendants contend that, the 3rd defendant having accepted to provide fund for payment of the drafts will be h liable to dishonouring the bills.” The second respondent in paragraphs 1 to 4 of its amended statement of defence pleaded thus:– i “1. Save except as are hereinafter specifically admitted the 3rd defendant denies each and every allegation of fact contained in the further amended Statement of Claim as if each were set out seriatim and separately denied. 2. The 3rd defendant denies paragraphs 1–4, 7–42 of the further j amended statement of claim.

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3. If (which is not admitted) the 3rd defendant is under a a contractual obligation to pay any sum of money to the plaintiff such obligation cannot be performed without the consent of the Federal Minister of Finance given pursuant to the Exchange Control Act, 1962. b 4. Neither the Federal Minister of Finance nor the Central Bank (to whom he (sic) Minister’s powers have been duly delegated) have given his permission or consent to the transaction giving rise to the alleged obligations of the 3rd c defendant to pay money to the plaintiff.” At the trial, the plaintiff’s only witness testified in support of plaintiff’s case. The witness called by the third respondent also testified. d At page 311 of the record, the only defence witness testified thus:– “There is an agreement by the parties for 3rd defendant to pay the amount claimed. Exhibit 5 shown to the witness. I identify exhibit e 5 as the agreement. The three drafts were endorsed by all the parties and sent to Romanian Company. In Banking, ‘without recourse’ discharge (sic) the endorser from liability. All assets of the Continental Motors were duly transferred to Obikoya & Sons as agreed.” f It is apparent that the only defence which the third respondent canvassed at the trial was that as the three bills of exchange were endorsed by all the parties and sent to the plaintiff in accordance the terms of the agreement, exhibit g “5”, the third respondent was discharged from further liability to the plaintiff because the bills of (sic) were endorsed ‘without recourse’ to the third respondent. h The first matter to be considered is exhibit “5”. Did the terms of exhibit “5” extend enough to absolve the third respondent from liability to the plaintiff on the outstanding sum of $1.7 million? The trial court in its judgment almost exclusively relied on exhibit “5” and the futile attempts by i parties to comply with its terms. At pages 368–369 of the record, the trial court in its judgment said:– “All the agreed terms except those in paragraph 4 (ii) gave no cause for dispute. The drafts were issued but not by the bank as j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 289 a agreed. They were accepted by the 3rd defendant and the plaintiff also accepted the endorsement without complaint and negotiated it. The complaint arose because the proceeds of the bills of exchange were not paid to the plaintiff. The drafts exhibits 8 – 8a b were dishonoured and duly protested by exhibits 9 – 9B. The amount of $1.7 million dollars due on the said bills remain unpaid hence this action. It is not and cannot be disputed that the basis of this action is the agreement in exhibit 5. The question, which I c believe the court is called upon to decide is, which of the defendants 2 – 4 is liable to make good het (sic) sum due”? (Italics mine.) From the question which the trial court framed in the passage underlined above, one gets the impression that the d trial court believed that the plaintiff’s case was solely based on the dishonoured bills of exchange. I shall later in this judgment discuss the correctness of that approach. The trial court went further at pages 371–373 of the record to express e the views, which spelt the death knell to the plaintiff’s case against third respondent thus:– “There is no doubt that the plaintiff was entitled to insist on the issue of the drafts in the terms of exhibit 5. When; however it f accepted and negotiated the drafts as issued though wrongly, it is deemed by at least conduct, have (sic) waived its insistence on its right to the proper made of issue. Is the obligation of the 4th defendant we may ask, discharged by that act of waiver? To this end we have recourse to the term g ‘without recourse’ to the bank exhibit 5. Can the plaintiff come back again to the 4th defendant after accepting the drafts as issued on the failure to eslise (sic) the proceeds? The answer would appear to be no. But let us examine it fully. The 4th defendant had h got the drafts prepared though wrongly and endorsed it to the Romanians, ‘without recourse’ to it i.e. the Bank. At that stage the 4th defendant’s obligation would appear to have been fully discharged on acceptance by the plaintiff without protest or rejection. The full import and meaning of the words ‘without i recourse’ is again provided in Black’s Dictionary (Supra) when in defining recourse it states–– ‘To recur. The right of a holder of a negotiable instrument to recover against a party secondarily liable, e.g. prior endorser. Therefore, if a prior endorser signs without recourse, he j exempts himself from liability for payment.’

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Again the same author defined the phrase ‘without recourse’ thus– a ‘This phrase, used in making a qualified endorsement of a negotiable instrument, signifies that the endorser means to save himself from liability to subsequent holders, and is a notification b that, if payment is refused by the parties primarily liable, recourse cannot be had to him. An endorser “without recourse” specially declines to assume any responsibility for payment. He assumes no contractual liability by virtue of the endorsement itself, and becomes a mere assignor of the title to the paper, but such an c endorsement does not indicate that the endorsee takes with notice of defects, or that he does not take on credit of the other parties to the note.’ Is the discharge of the 4th defendant complete as between the d parties primarily liable? 3rd defendant is the person primarily liable to discharge the outstanding debt.” The court below took the same view with the trial court when at pages 553–554 of the record it said in its e judgment:– “In this case, waiver was not specifically pleaded by any of the parties at the trial. The nearest of this was in paragraph 2D of the statement of defence of the first and 3rd respondents where they pleaded reliance on both legal and equitable defences. But from f the pleadings of the parties and the evidence at the trial, it is not in dispute that there was an irregularity or breach of the terms and conditions of exhibit 5 by which the parties were bound, in drawing up the three drafts exhibits 8, 8A and 8B. The pleading g and evidence has shown that despite this irregularity, the plaintiff/respondent accepted the drafts and acted on them accordingly. Under this situation, the trial court, in my respectful view, is entitled to assume from the conduct of the plaintiff/respondent, that having failed to raise any objection at h the time the drafts were presented to it, has decided to abandon its right to have the drafts correctly drawn up in compliance with the provisions of exhibit 5. I agree with the learned Chief Judge when, in his judgment at p. 371 of the record said – i ‘There is no doubt that the plaintiff was entitled to insist on the issue of the drafts in terms of exhibit 5. When however it accepted and negotiated the drafts as I said though wrongly, it is deemed by at least conduct to have waived its insistence on its right to the proper mode of issue.’” j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 291 a Since waiver was the central basis upon which the two courts below decided the case, it is necessary to examine closely exhibit “5” in relation to exhibits “8”, “8A” and b “8B” in order to ascertain whether or not the plaintiff had by accepting and negotiating exhibits “8”, “8A” and “8B” waived its right to insist on performance by the third respondent of the terms of exhibit “5”. The relevant part of c exhibit “5” provides:– “4. Agreement has today been reached at this meeting as follows–– (i) The Bank has agreed to pay to the Romanians by d giving instructions to the Central Bank of Nigeria and/or the Bank’s Foreign correspondents within 48 hours to pay the sum of U.S$5,293.781.97. (ii) The Bank would draw three drafts on Messrs. Obikoya & Sons Ltd for–– e (a) $500,000.00 due 1/12/75; (b) $600,000.00 due 1/12/76; (c) $600,000.00 due 1/12/77. f totalling U.S $1,700,000.00. These drafts would be accepted by Messrs Obikoya & Sons Ltd and returned to the Bank within 7 days from the date of this agreement. The Bank will endorse these drafts to the Romanians, without recourse to the Bank, as full and g final payment for the balance of all amounts due to the Romanians. (iii) In consideration of (ii) above, the bank has agreed to transfer to Messrs. A. Obikoya & Sons Ltd, all the h assets of Continental Motors and Engineering Company Ltd taken over by the Receiver and Manager, excluding freehold landed properties, as at 14 October, 1974 subject to the following conditions– i (a) all debts due to the Continental Motors and Engineering Company Ltd as at 14 October, 1974 will be collected by Messrs. A. Obikoya & Sons Ltd for account of and on behalf of the Receiver and Manager and/or the Bank, after j deducting commission at the agreed rate.

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(b) The Receiver and Manager and/or Bank will a account to Obikoya & Sons Ltd for proceeds of all assets sold from 14 October, 1974 up-to-date, less expenditure incurred. b (c) The Bank will not pay any custom duty, rents, N.P.A. charges or any other expenses whatsoever in respect of the goods. (d) The Bank will not be responsible for payment of any expenses in respect of, or incurred by, c Continental Motors and Engineering Company Ltd in any respect whatsoever after 21 May, 1975 with the exception of the salaries and wages of staff who are on the register of the Company as at 20 May, 1975 and in respect of d such staff, the Bank’s liability would be limited to salaries, wages and allowances up to 4 June, 1975 plus where necessary, salary in lieu of notice for a period not exceeding one month e from that date.” Under the terms of exhibit “5” above in paragraph 4(ii), the third respondent was to draw three drafts on the second respondent for a total sum of US $1,700,000. The sum of US f $500,000 was due on 1/12/75, US $600,000 due on 1/12/76 and US $600,000 due on 1/12/77. These drafts were to be accepted by the second respondent and returned to the third respondent within seven days. The third respondent would g then endorse the drafts to the plaintiff without recourse to itself. It was in an attempt to satisfy the terms of the agreement between the parties that the bills exhibits “8”, “8A” and “8B” were made. Whereas, under exhibit “5”, the h third respondent was to draw the bills of exchange, the bills exhibits “8”, “8A” and “8B” were in fact drawn by the first respondent. The bills were accepted by the second defendant and later they were endorsed by the third respondent to the plaintiff. The third respondent which had not drawn the bill i as was required of it under exhibit “5” then endorsed the bills “without recourse” to itself. The bills when later negotiated were dishonoured. The plaintiffs protested them and later sued. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 293 a Both the trial court and the court below took the view that since the bills exhibits “8”, “8A” and “8B” were not drawn in accordance with the terms of exhibit “5”, the plaintiff was b at liberty to return the drafts and ask that they be redrawn; and that having negotiated the bills in the form in which they were drawn, the plaintiff had thereby waived its right to contest that the bills were improperly issued. c The first and third respondents’ Counsel in his brief of argument before this Court argued that since the plaintiff/appellant accepted the bills without protesting that they were irregularly drawn or issued, it had waived its right d to complain later. Counsel relied on Ariori v Elemo (1983) 1 SC 13 at 18; (1983) 1 SCNLR 1; Adegoke Motors Ltd v Adesanya (1989) 3 NWLR (Part 109) 250 at 255; Smyth Ross J & Co Ltd v Banley, Sons & Co [1940] 3 All ER 60 and Odu’a Investment Co Ltd v Talabi (1997) 10 NWLR e (Part 523) 1 at 50 – 57. Plaintiff’s/appellant’s Counsel for his part argued that waiver, being an equitable defence could not be relied upon f to defeat or override a party’s right to property. He relied on Ogboru v Ibori, a decision of the Court of Appeal, Benin Division on 13/7/05. Counsel further argued that in any case parties did not raise “waiver” in their pleadings. g Now in Ariori and others v Elemo and others (1983) NSCC 1 at 8; (1983) 1 SCNLR 1 at 13, this Court per Eso JSC discussed the nature of waiver thus: “In the context of this appeal therefore, the first question that one h asks is ‘what is waiver’? Rather than define the word, it is probably appropriate just to describe its concept. For as Pollock said, waiver is a simple and wholly untechnical concept perhaps the most powerful and flexible instrument to be found in any system of court jurisprudence. The concept of waiver must be one i that presupposes that the person who is to enjoy a benefit or who has the choice of two benefits is fully aware of his right to the benefit or benefits, but he either neglects to exercise his right to the benefit, or where he has a choice of two, he decides to take one but not both, see – Vivyan v Vyan 30 Beav 65 as per Sir John j Romilly M.R. at p. 74 (reported also in 54 E.R. 817). The exercise

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has to be a voluntary act. There is little doubt that, a man who is a not under any legal disability should be the best judge of his own interest. If therefore, having full knowledge of the rights, interests, profits or benefits conferred upon or accruing to him by and under the law, but he intentionally decides to give up all these, or some b of them, he cannot be heard to complain afterwards that he has not been permitted the exercise of his rights, or that he has suffered by his not having exercised his rights. He should be held to have waived those rights. He is, to put it in another way, estopped from c raising the issue. See also Halsbury Laws of England, 3rd Edition, Volume 14, Para. 1175.” The trial court and the court below rightly held in my view that was open to the plaintiff/appellant to have refused to d accept the bills exhibits “8”, “8A” and “8B” on the ground that they were not drawn in the manner agreed in exhibit “5” and that not having so refused them had waived its right to complain that the bills were not validly issued. It is however e important to understand the nature of the right that the plaintiff/ appellant waived by such non-objection. The deep error into which both courts below fell was to assume that the plaintiff/appellant by negotiating the bills had thereby agreed to forfeit its right of action against the third f respondent on the contract of guarantee. But first let me deal with the argument by the plaintiff’s/ appellant’s Counsel that “waiver” was not an issue on the g pleadings. It must be understood that the law applicable to bills of exchange is largely statutory, and in Nigeria, the applicable law is the Bills of Exchange Act Cap 35 Laws of the Federation of Nigeria, 1990. Once a bill of exchange h which ex facie fulfils all the essential pre-requisites as stipulated under the Act has come into existence, the determination of the liabilities of the parties to the bill must be determined as laid down under the Act. The plaintiff/ appellant by negotiating the bills in the form in which they i were drawn gave them the appearance of bills validly drawn under the law. If the plaintiff had rejected the bills and insisted that they be drawn in accordance with exhibit “5”, it could not have become an issue in the proceedings that the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 295 a bills were improperly issued. Having agreed that the bills were validly drawn by negotiating them, the plaintiff/ appellant could not stop the courts below from treating the b said bills otherwise than as provided under the Bills of Exchange Act. It is only to that extent that the plaintiff/ appellant could be said to have waived its right. Given the circumstances of this case, it was only c necessary for the third respondent to plead the facts which estopped the plaintiff/appellant from contesting that the bills were not issued in accordance with the terms of exhibit “5”. And precisely this was what the third respondent did in d paragraphs 7(e) and (8) of its further amended statement of defence earlier reproduced. Once more I reproduce it:– “7. (e) The 3rd defendant having accepted the three drafts i.e– (1) $500,000.00 due on 1/12/75; e (2) $600,000.00 due on 1/12/76; and (3) $600,000.00 due on 1/12/77 drawn by the 2nd defendant and accepted by the 3rd defendant A. O. Obikoya & Sons Ltd and endorsed by the f 4th defendant to the Romania Bank without recourse to the 4th defendant denies any liability to the plaintiff in the said sum of $1.7 million dollars with interest claimed (N1,089,743.50) nor in any sum or at all. 8. In further answer to paragraph 33 of the further amended g statement of claim, the 4th defendant contends that the said 3 drafts amount to $1.7million dollars were regularly drawn in compliance with the provisions of the Memorandum of Agreement dated 20 May, 1975. In the alternative the 2nd h and 4th defendants contend that, the 3rd defendant contend that, (sic) the 3rd defendant having accepted to provide funds for payment of the drafts will be liable to dishonouring the bills.” What the third defendant pleaded above was that the i plaintiff, having received and negotiated exhibits “8”, “8A” and “8B” in the form in which they were drawn could no longer argue that they were not validly issued. I think that the argument of plaintiff’s/appellant’s Counsel that the j third respondent did not plead waiver is not well-founded.

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A party’s duty is to plead relevant facts and to leave the a court to apply the law or determine the consequences in law upon the facts pleaded. In Nwadiaro v Shell Development Co Ltd (1990) 5 NWLR b (Part 322 at 333– 34, Kolawole JCA (of blessed memory) when confronted with a similar position observed:– “The settled principle of law which is of great antiquity and which has been restated in many authoritative decisions of the courts was c stated by Farwell, L.J. thus– ‘But, as the point of pleading is of some importance and was strenuously argued, I propose to state my opinion on it. Order XIX Rule 4 provides that – d ‘every pleading shall contain, and contain only, a statement in a summary form of the material facts on which the party pleading relies . . . – i.e., the pleader must plead facts, not law, and must not plead the evidence in support of his facts’. e (See North-Western Salt Company Ltd. v Electro Lytic Alkali Co. Ltd. (1913) 3 K.B. 422 at 425). There is a vital distinction between pleading law, which is not permitted, and raising a point of law in a pleading, which is f permitted under Rule 1 of Order 29 aforementioned. Pleading law obscures or conceals the facts of the case; raising a point of law defines or isolates an issue or question of law on the facts as pleaded.” g Scrutton LJ put it in another way. He observed in Lever Brothers Ltd and others v Bell and another [1931] 1 KB 557. “The practice of the courts is to consider and deal with the legal h result of pleaded facts, although the particular result alleged is not stated in the pleading.” The inferences of law to be drawn from the pleaded facts need not be stated in pleadings. Thus, if the material facts i are alleged, it is not necessary to plead an implied warranty. (Per Denning LJ in Shaw v Shaw (1954) 2 QB 429 at 441). (See also The Supreme Court Practice 1985 Volume 1 pages 261 – 262). j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 297 a Similarly in Re Vandervell’s Trusts (No. 2) [1974] 3 All ER 205 at 213 Lord Denning MR said:– “It is sufficient for the pleader to state the material facts. He need b not state the legal result. If, for convenience, he does so, he is not bound by, or limited to, what he has stated. He can present, in argument any legal consequence of which the facts permit. The pleadings in this case contained all the material facts.” c Surely, the plaintiff/appellant in that case could not have expected the courts below not to treat the bills as valid bills of exchange when ex facie they comply with the requirements of the law under the Bills of Exchange Act Cap 35. In that narrow sense, it is my view that the two courts below d were right in holding that the plaintiff/appellant by negotiating the bills had waived its right to complain as to the manner the bills were drawn. e Sections 16, 54 and 55(1)(a) and (b) of the Bills of Exchange Act Cap 35 provide:– “16. The drawer of a bill and any endorser may insert there in (sic) an express stipulation– f (a) negativing or limiting his own liability to the holder; (b) waiving as regards himself some or all of the holder’s duties”. 54. The acceptor of a bill by accepting it– g (a) engages that he will pay it according to the tenor of his acceptance; (b) is precluded from denying to a holder in due course–– (i) the existence of the drawer, the genuiness of his h signature, and his capacity and authority to draw the bill; (ii) in the case of a bill payable to drawer’s order, the then capacity of the drawer to endorse, but i not the genuiness or validity of his endorsement; (iii) in the case of a bill payable to the order of a third person, the existence of the payee and his then capacity to endorse but not the genuiness j or validity of his endorsement.

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55. (1) The drawer of a bill by drawing it–– a (a) engages that on due presentment it shall be accepted and paid according to its tenor, and that if it be dishonoured, he will compensate the holder b or any endorser who is compelled to pay it, provided that the requisite proceedings on dishonour be duly taken; (b) is precluded from denying to a holder in due course the existence of the payee and his then c capacity to endorse”. The relevant facts of this case which were undisputed are these:– d (1) That the first respondent drew the bills exhibits “8”, “8A” and “8B”. (2) That the second respondent was the acceptor of the said exhibits “8”, “8A” and “8B” and that the e acceptance was unqualified. (3) That the third respondent negatived his liability on the bills by endorsing it “without recourse”. (4) That the bills on presentment were dishonoured. f Under the Bills of Exchange Act, the first and second respondents as drawer and acceptor respectively of the bills should have been held jointly and severally liable to pay the total value of the bills which is US $1.7 million. There was g no basis to exclude the first respondent from liability as the two courts below did. Their liability is as prescribed under sections 54 and 55 of the Bills of Exchange Act above. h The liability of the third respondent under the Bills of Exchange Act is however a different matter. Section 16 of the Act permits an endorser to limit or negative its liability under a bill of exchange. The plaintiff/appellant having negotiated the bills, which carried the endorsement “without i recourse”, would appear to have accepted that it had no right of action against the third respondent under the Bills of Exchange Act. The meaning of the phrase is as explained in the passage of the judgment of the trial court which I j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 299 a reproduced earlier. Put simply, the phrase conveys to subsequent endorsees and holders in due course that the third respondent was not liable on the bills. b The conclusion is inevitable that the third respondent having negatived its liability on the bills of exchange could not be held liable on the said bills. The two courts below, in so far as they relied on section 16 of the Bills of Exchange c Act were right in their conclusion that the third respondent could not be held liable under exhibits “8”, “8A” and “8B”. But was the third respondent entitled to walk away free from liability under plaintiff’s suit? I think not. The two d Courts below viewed plaintiff’s claim rather too narrowly. They both assumed that plaintiff’s claim against the third respondent was based exclusively on the dishonoured bills of exchange. But a perusal of plaintiff’s pleadings reveals e that plaintiff’s case was more broadly based than appreciated by the two courts below. Plaintiff’s claim was founded on two planks namely (1) the dishonoured bills of exchange exhibits “8”, “8A” and “8B” and (2) the deeds of f guarantee, which the third respondent executed in order to get the plaintiff (sic) grant credit to the Nigerian buyer. In paragraphs 13, 14, 15, 24, 25, 26, 27 and 28 of the further amended statement of claim, the plaintiff pleaded thus:– g “13. By a guarantee in writing dated 4 May, 1971, given by the 4th defendant to the plaintiff, the 4th defendant guaranteed to the plaintiff payment of the value of the various tractors and spare parts supplied by the plaintiff to the said Continental Motors and Engineering Company Ltd in accordance with h the said Agreement dated 27 June, 1970 and the additional sales contract dated 4 May, 1971, and under the terms and conditions therein expressed. 14. It was further a term of the said Guarantee that the said i Guarantee shall be a continuing guarantee for all moneys due and payable and to become due and payable to the plaintiff as above. The plaintiff will at the trial of this action rely on the said Guarantee for its full terms and effect. 15. In pursuance of the said Agreement the said Continental j Motors and Engineering Company Ltd got the 4th defendant

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to provide the necessary respective irrevocable Bank a Guarantee and, upon the 4th defendant opening the necessary respective irrevocable Letters of Credit in favour of the said Auto-Tractor Bucharest at the 4th defendant’s London Branch, the various vehicles and spare parts as agreed under b the said Agreements shipped by the Auto-Tractor Bucharest to the said Continental Motor and Engineering Company Ltd in Lagos which took delivery of the same in Lagos, between 1970 and 1972 at the total invoice price of US$9,314,565.58. c 24. The 4th defendant Bank then appointed Mr. J. A. Adebayo, as the receiver and Manager of the said Continental Motors and Engineering Company Ltd (the 2nd defendant) and called a meeting of the representatives of the plaintiff, A. Obikoya and Sons Ltd (the 3rd defendant) and the said d Receiver and Manager to explore the possibilities of settling the outstanding account. 25. The meeting was held in Lagos on the 20 May, 1975 and a Memorandum of Agreement dated 20 May, 1975 was drawn e up and signed by the representatives of the plaintiff, A.Obikoya and Sons Ltd, the 4th defendant Bank and the said Receiver and Manager. 26. Under the said Agreement, the 4th defendant agreed to pay f the sum of US$9,314,565.58 representing the invoice value only of all the vehicles, spare parts and components shipped to the said Continental Motors and Engineering Company Ltd by the 4th defendant, and also less an amount to be agreed for which a draft was to be drawn by the 4th g defendant on 3rd defendant and to be accepted by the 3rd defendant and endorsed by the 4th defendant in favour of the plaintiff in full and final settlement of the outstanding account. h 27. It was further agreed under the said agreement, inter-alia, as follows– (1) The 4th defendant agreed to pay to the plaintiff by giving instructions to the Central Bank of Nigeria and/or the 4th defendant’s foreign correspondents the sum of i US$293,781.97 (2) The 4th defendant should draw three drafts on the 3rd defendant for–– (a) US$500,000.00 due on 1 Dec. 1975; j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 301 a (b) US$600,000.00 due on 1 Dec. 1976; and (c) US$600,000.00 due on 1 Dec. 1977 Totalling US$1,700,000.00 b These drafts should be accepted by the 3rd defendant and returned to the 4th defendant which endorse (sic) them to the plaintiff in full and final settlement of the outstanding account. The plaintiff will at the trial of this action, rely on the said c drafts for their full terms and effect. 28. The said sum US$1,700,000.00 represents the value put on all the assets of the said Continental Motors and Engineering Company Ltd excluding free hold landed properties which d the said Receiver and Manager of Continental Motors and Engineering Company Ltd would transfer to the 3rd defendant under the said agreement.” In the above paragraphs, the plaintiff pleaded that it granted e credit to the Nigerian buyer on the basis of deeds of guarantee executed in its favour by the third respondent. A default did occur when the Nigerian buyer could not pay for the goods supplied it by the plaintiff. In accordance with the f terms of the deeds of guarantee, the third respondent agreed to pay the whole of the money owed to the plaintiff by the Nigerian buyer. Indeed, the third respondent did pay about US $7.5 million dollars out of the money leaving a balance of US $1.7 million. g It was in order to lessen or remove the burden on the third respondent that exhibit “5” was made. The underlying assumption upon which the terms of exhibit “5” were agreed as made manifest by events leading to the making of exhibit h “5” was that the bills, exhibits “8”, “8A” and “8B” when drawn and paid would release the third respondent from further liability to the plaintiff on the deeds of guarantee. The reality underlying exhibit “5” was that the identified i assets of the Nigerian buyer worth US $1.7 million would be acquired by the second respondent so that a release could be secured by third respondent for that amount upon payment of the bills of exchange exhibits “8”, “8A” and “8B”. As it j turned out, the bills were dishonoured. It seems clear to me

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC 302 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) that the dishonour of the bill was as much an injury to the a plaintiff as it was to the third respondent since it destroyed the only lifeline thrown to the third respondent to extricate itself from the obligations it entered into under the deeds of b guarantee for the debts owed by the Nigerian buyer. It would in my view amount to a monumental failure of justice to allow the third respondent who guaranteed the repayment of the credit granted by the plaintiff to the Nigerian c buyer to walk away free from liability while the debt, the repayment of which it guaranteed remained unpaid. The two courts below should have seen that the recourse to exhibit “5” and the drawing of bills of exchange was the d culmination of the attempts made by the plaintiff to force the third respondent to honour its obligation under the deeds of guarantee rather than an escape route for the third respondent. Indeed, it would have turned out to be a true e escape route had the second respondent honoured the bills of exchange it accepted. It seems to me also that the error of the two courts below was in treating plaintiff’s case as solely an action under a f dishonoured bill of exchange. If the plaintiff had elected to base its claim solely on the Bills of Exchange Act, there would have been no need for it to plead the transactions between it and the Nigerian buyer pursuant to which the g third respondent executed deeds of guarantee in its (plaintiff’s) favour. The plaintiff would only have pleaded the facts, which enabled the liabilities of the parties to the bills to be determined under the Bills of Exchange Act. This h is because, consideration, an important element under the law of contract is generally presumed in an action brought under the Bills of Exchange Act. Further, in the manner the two courts below treated the issue of waiver, it was assumed that what the plaintiff waived was the right to be paid the i balance due to it under the deeds of guarantee executed in its favour by the third respondent. It is however manifest that the right, which the plaintiff could be deemed to have waived is not to contest that the liabilities under the bills be j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Oguntade JSC Auto Import Export v Adebayo 303 a determined otherwise than as provided under the Bills of Exchange Act. In the final conclusion, the judgments of the two courts b below are set aside. In its place, judgment is given against the first, second and third defendants jointly and severally for the sum of US $1.7million. The judgment sum shall attract interest at the rate of 12% per annum from 2/12/77 c until 16 July, 1986 when the judgment of the trial court was given and thereafter interest at 6% per annum until the judgment debt and interest are fully paid. The appellant is entitled to costs against the third respondent which I fix at d N10,000. ONU JSC: Having been privileged to read before now the judgment just delivered by my learned brother, Oguntade JSC I entirely agree with him that the appeal is meritorious e and it is therefore allowed by me. By way of brief expatiation I wish to add as follows:– Four issues were formulated as arising for determination f and it is my desire to consider them together as an embodiment with emphasis on only issues 1 and 2 as being sufficient to dispose of the appeal. The two issues taken together are set out hereunder as follows:– g Issues 1 and 2 considered together:– (a) Whether the appellant had waived its right of recovering the balance of the debt from the third respondent and whether the third respondent can rely h on the defence of waiver when such was not pleaded (ground 1) (b) Whether or not the endorsement of the three (3) drafts, exhibit “8”, “8A” and “8B” by the third i respondent was a mere formality or a recognition of the third respondent’s continued indebtedness to the appellant (grounds 2 and 3). The learned trial Judge at pages 370 – 371 of the record, j dealt with the general meaning of waiver and came to the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC 304 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) conclusion that when the appellant accepted and negotiated a the wrongly issued drafts, it had at least by conduct waived its insistence on its right to the proper mode of issuance. We were then referred to pages 129 and 130 of Byles on Bills of b Exchange (23ed) M Megrah and FR Ryder to the effect that:– “the Code contains the following provisions in reference to the renunciation by the holder of his rights on a bill or note, Section c 62(1) when the holder of a bill at or after its maturity absolutely and unconditionally renounces his rights against the acceptor the Bill is discharged. The renunciation must be in writing unless the Bill is delivered up to the acceptor.” It is next submitted on appellant’s behalf that from the above d opinion and the provision of the law which is in pari materia with section 62 of the Nigerian Bills of Exchange Act, it becomes obvious that waiver as it relates to Bills of Exchange which will amount to a renunciation of one’s e right in that bill must be in writing. Appellant further submitted that from the facts of this case, one of the holder’s rights on the bill was that it should be drawn by the third defendant. The plaintiff, it is pointed out, did not f renounce this right in writing. Thus, the third defendant by its letter dated 15 October, 1974 (exhibit “4”) had accepted liability and responsibility for the payment of the outstanding amount and proposed that 30% of that amount g which represented the price of the goods transferred to the second defendant/appellant would be settled in the following way:– “A draft or drafts would be drawn by Continental Motors on the h Mr. Obikoya’s Company, accepted by that Company and endorsed to you (plaintiff) without recourse to Continental Motors or the Bank.” That this proposal has been altered by the plaintiff, it further added, is obvious when one looks at Clause 4(ii) of i the Memorandum of Agreement. The third defendant by failing to prepare the drafts properly, it is emphasised, has clearly breached the provisions of the Memorandum of Agreement. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 305 a The appellant therefore contended that ordinarily, it would appear that since the appellant went ahead to negotiate the irregularly-drawn three (3) drafts immediately b they were sent to it, that the appellant has waived its rights of having the drafts properly drawn, noting that under the Bills of Exchange Act Cap 21 (ibid), renunciation of a holder’s rights must be in writing for such a waiver to afford c a discharge to the other parties unless the bill is delivered up to the acceptor. It is further submitted that under the Bill of Exchange Act Cap 21, the conduct of that plaintiff which will be sufficient d to constitute a waiver is for the plaintiff to renounce its rights unconditionally to the Bill. Ordinarily, it is further contended, such renunciation must be in writing, otherwise, the mere acceptance and negotiation of the Bill even though e they were improperly drawn without more, is with great respect, insufficient to be construed as a waiver of the plaintiff’s right to the Bill. Section 62 of the Bills of Exchange Act Cap 21 Laws of f the Federation whose sub-sections (1) and (2) are in pari materia with section 62 Bills of Exchange Act, 1882 which in pari passu states:– g “62 (1) When the holder of a Bill at or after its maturity absolutely and unconditionally renounces his rights against the acceptor, the bill is discharged and the renunciation must be in writing unless the bill is delivered up to the accept or h 62 (2) The liabilities of any party to a bill may in like manner, be renounced by the holder before, at or after its maturity, but nothing in this section shall affect the rights of a holder in due course without notice of the i renunciation”. (Italics for emphasis.) See the case of Rimal v Carthwright (1924) WN 229 (CA) which dealt with section 62 of the Bills of Exchange Act, 1882, in which it was held that in an action on a Bill of j Exchange, evidence could not vary its terms nor in view of

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC 306 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) section 62 of the Bills of Exchange Act, 1882 could a parole a agreement be a discharge”. I therefore agree with the appellant’s submission that, for a holder of a bill to waive or renounce his right under the b bill, the same must be in writing. An oral agreement is not sufficient, let alone a waiver by conduct. Such a renunciation or such evidence of writing should be that of the holder, in this case, the plaintiff and not that of the third c defendant. See Re George Francis v Bruce (1890) 44 Ch D 627. The fact that the plaintiff on sighting the wrongly drawn bills, presented them to the bank for payment without an d immediate protest that the bills were wrongly drawn, does not and cannot mean that the plaintiff (appellant) has waived or renounced its right as to the mode of issue. Sections 59 – 64 of the Bill of Exchange Act Cap 21, it must be e emphasized, deal with the issue of discharge of bills; express waiver being the mode by which a bill is discharged. Full compliance with the mode of waiver, it must be pointed out, is very imperative for the rest provisions dealing with that f kind of discharge to apply. In this wise, I agree with the appellant’s submission that the third defendant must bear its responsibility to pay either under the continuing guarantee or as indorser under the Bills g of Exchange Act Cap 21 (ibid). The appellant further argued that assuming without conceding that section 62(1) of the Act does not apply to the h circumstances of this case in respect of the third respondent, as it (third respondent) was not an acceptor of the three bills, by virtue of the agreement of 20 May, 1995, (exhibit “5”) and the third respondent assumed the position of the principal debtor. For this reason, I am in agreement with the i appellant that it falls on its shoulders primarily to settle all the outstanding debts owing to the appellant including the $1.7 million dollars now in dispute. I am therefore in agreement with the appellant that any person who is acting j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 307 a in any manner howsoever to pay or defray the balance of the indebtedness is doing so as an agent of the third respondent. According to the agreement, the respondent was to draw the b drafts on Messrs Obikoya & Sons Ltd, which will accept and return same to the third respondent which will then endorse it “without recourse” to the appellant. Rather than sticking to the above mode, the drafts were drawn by Mr JAA Adebayo c (second defendant in the trial court) and the receiver/ manager of the Continental Motors & Engineering Company which later endorsed to Messrs Obikoya & Sons Ltd, who by the agreement was to take over the assets of the Continental Motors & Engineering Company. d I agree with the appellant’s submission to the effect that since the drafts were irregularly drawn and the third respondent did not query it but rather went ahead to endorse e it to the appellant and having assumed the position of a principal debtor in recognition of the original guarantorship agreement it should assume the responsibility expected of a disclosed principal. f I agree with the appellant’s submission therefore that the liability of a drawer of a defective bill to the holder is not in doubt and since the Continental Motors and Engineering Company Ltd, drew the bills as agents of the third g respondent is the drawer of the bills and waiver of right against it must be expressly done in accordance with section 62(1) of the Bill of Exchange Act (ibid). Also, note should be taken of the fact that section 30(2) of Bills of Exchange Act has made every holder of a bill a holder in due course. h By section 38(2) of the Act, a holder in due course can enforce payment against all parties liable on the bill while section 30(1) had made every party whose signature appears on a bill parties to the bill. Hence, every party whose i signature appears on a bill is a party to the bill. Thus, in the alternative, the appellant being a holder in due course can recover the value of the Bill from all the respondents jointly and severally, especially from the third respondent if not as j drawer then as a party to the bills.

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From the foregoing, it goes without saying that the a appellant is entitled to be compensated by all the parties to the bills especially the third respondent being the last indorser. The amount of compensation should be the amount b disclosed on the face of the bills, which in this case is $1,700,000. Be it noted that as an indorser of the bill to the appellant, the third respondent has the same liability as the drawer of the bill. This is because every indorser of a bill is c in the nature of a new drawer, and is liable to every proceeding holder in default of acceptance or payment by the drawer. See Byles on Bills of Exchange (23ed) at page 168; Mc Call Brothers Ltd v Hargreaves [1932] 2 KB 423. Also McDonald v Nash (1924) AC 625; National Sales d Corporation v Bernardi [1931] 2 KB 188. From the foregoing, I hold that the court below with due respect, was grossly in error when it upheld the general definition of waiver as adopted by the trial court instead of e confining itself to the mode stipulated in section 62(1) and (2) of the Bills of Exchange Act. The court below by failing to consider subsection 2 of section 62 rather became ill- equipped and arrived at a wrong conclusion that the whole f of section 62, which provides in mandatory terms for express waiver, does not apply in this case. It is for this that I arrive at the conclusion that the whole of section 62, which provides in mandatory terms for express waiver does not g apply in this case. It is for this reason that I agree with the appellant’s reason that in order for a party to a bill may (sic) be liable as provided in section 55 of the Act, the holder must have expressly waived his right or denounced the h liabilities of the parties. As I agree that this is not the case in the matter under consideration, there is therefore no iota of waiver by the appellant vide Rimal v Cartwright (1924) 1 WN 229 (CA) where it was held that in an action on a bill of exchange, evidence could not vary the terms neither can a i parole agreement be a discharge. It was n (sic) contended that assuming without conceding that section 62 of the Bills Exchange Act has no application to the matter under consideration whether it can be that the conduct of the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 309 a appellant in this case amounts to a waiver in the ordinary sense of the word? The contention of the respondent is that the attitude of the appellant amounted to a waiver when in b sighting the wrongly drawn bills, it did not immediately protest, it rather presented same to the bank for payment and only protested it when it could not be accepted for payment in the bank due to insufficiency of funds. I am of the view that this cannot amount to waiver. In the first place, there is c no time limit stipulated in the agreement of 20 May, 1975 (exhibit “5”) as to the protestation of irregularity in the mode of drawing the bills. d Secondly, I agree that the irregularity in drawing the bill amounts only to a breach of the contract comprised in the agreement (exhibit “5”) and the limiting period in breach of contract cases being six years and that this period has not e lapsed before the protestation was made neither has it lapsed before the present action was instituted. I agree that it can be argued that the appellant delayed protesting the irregular issue of the bills, the delay without more does not constitute waiver. While it may be evidence tending to establish it, f such evidence is by no means conclusive. See African Petroleum v Owodunni (1991) 8 NWLR Part 210) 391 at 416, paragraphs E–F where this court (per Nnaemeka-Agu JSC) defined waiver as an abandonment of a right and g showing by words or conduct not to insist on the right, and went on further to state as follows:– “I do not even agree that there has (sic) delay on the part of the defendant to raise the invalidity of the notice. But assuming but h not agreeing that there was delay, such a delay of itself does not constitute a waiver. At best, it may be some evidence tending to establish it, but is not conclusive. See Selwyn v Gorfit 38 Ch.D. 873 per Bowen, L.J.” i In that regard, I agree with the appellant’s contention that the mere fact that it waited for the bills to be dishonoured before coming back to demand the payment of the debt from the respondents (sic). Even if the appellant proceeded to j waive its right of insisting that the bills be of exhibit “5”, it

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC 310 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) has not waived its right arising from the exhibit, that is the a right of being paid the balance of $1,700,000 jointly or severally by the respondents. In Arubo v Aiyeleru (1993) 3 NWLR (Part 280) 126 at 145 – 146 paragraphs H – A, this b Court considered the case of a defendant who securing a final judgment in court went back and submitted himself to a tribunal of inquiry which sought to enquire into the subject matter of the action that led to the judgment. The contention c of the opposing party in a later suit was that the defendant had waived his right, having taken part in the proceedings of the tribunal of inquiry. Nnaemeka-Agu, JSC there held as follows:– d “Definitely mere participation in the inquiry cannot per se constitute a waiver. But assuming but not agreeing that a judgment of court could be waived in such a way as to bar the successful party from insisting upon . . . of jurisdiction is so conclusive and binding upon the parties and their privies. I have my doubts as to e whether a right arising from it can be waived”. (Italics for emphasis supplied by me.) Appellant next pointed out how the above cited case dealt with the issue of waiver of right to rely on a judgment of the f court while the case in hand is dealing with waiving the right to insist on an agreement. Appellant opined thereupon that the agreement provided for its right to be paid for the goods supplied for which the third respondent was a guarantor and g provides also the mode of paying the debt. Such that if the method of payment provided in the agreement fails or is waived by the appellant, the right to be paid still subsists. The more so, it is added, when it that the three bills be re- h issued in accordance with the position of exhibits, the appellant’s contention and claim having all along been that the balance of US$1,700,000 be paid to it (sic). The court below went ahead to hold that the trial court i was right in assuming that the appellant has waived its rights to have the drafts drawn in accordance with the provisions of exhibits, the court not having held that the appellant has lost its right to insist that the balance of US $1,700,000 be j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 311 a paid to it jointly and severally by all the respondents as per its statement of claim especially in relation to the third respondent which originally guaranteed the debt and by b exhibit “5” had undertaken to play a substantial role in paying the debt to the appellant. Furthermore, it was pointed out, the circumstances that led to appellant suing the respondent were that the drafts bounced due to insufficiency c of funds. It was appellant’s further contention that no person can be said to have abandoned his right of being paid a debt owing to him simply because he negotiated a worthless cheque which ordinarily would have entitled the drawer and the endorser to some kind of penal reward. d The issuance of a dud cheque, it was therefore further contended, being a criminal offence and consequently against the Nigerian public policy and as such, no person is e endowed with the competence to waive a right that is not only for his personal enjoyment. The appellant’s right to insist that the respondents be made to pay their indebtedness to the appellant which it had failed to do through a method f which is both morally questionable and/or legally objectionable, is not a right that crystallizes for the sole benefit of the appellant but the larger society. See where this court held in Ariori v Elemo (1983) 1 SCNLR 1 at 13 paragraphs D-E to the effect that:– g “When a right is conferred solely for the benefit of an individual there should be no problem as to the extent to which he could waive such right.” h This Court further went on to hold at page 15 of the same report with approval in another case of A-G of Bendel State v A-G of the Federation and others (1981) 10 SC 1 at 54; (1982) 3 NCLR 1 where it opined that:– i “The law does not permit a person to contract himself out of or waive as the effect of a rule of public policy.” It was further contended that since the issuance and or endorsement of a dud cheque has been made a crime by the j State, an individual has nothing at all to waive in that

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC 312 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) respect, adding that this Court rested the matter when it held a as follows:– “Once the act is completely within the competence of either the State or . . . the court, the party to the case has nothing to waive.” b It is submitted further that no person should be said to have waived his or her right to complain that any or all the parties that played fraud on him should not be made to regularise the irregularity especially when their regularity has been c made by the state to attract a criminal sanction as in the instant case. Waiver, it is emphasized should be a voluntary action as no party should be tricked into waiving its right and conclusively the waiving of right should not be such that d can embarrass the administration of the law nor made to defeat public justice. See State v MCtaque (1927) 173 MIN 153. The defence of waiver being a defence available to the defendant, must be clearly raised in the statement of e defence. See Caribbean Trading and Fidelity Corporation v NNPC (1992) 7 NWLR (Part 252) 161 at 185 paragraphs A- B (per Tobi JCA) as he then was, when he observed thus:– “Waiver, being a defence available to a defendant must be clearly f raised in the statement of defence. Where it is not raised, then the defendant cannot lead evidence on it. This is borne out from the elementary rule of pleadings that a party is bound by his pleadings. He cannot, as a matter of general principle, raise a matter either in the course of trial or on appeal to embarrass the opponent.” (Italics g for emphasis.) The court below at page 23 vide page 553 lines 13 – 27 of the records found that none of the parties pleaded waiver h specifically and that the nearest to that was in paragraph 2D of the statement of defence of the first and third respondents (in the trial court) where they pleaded reliance on both legal and equitable defences and that the issue of waiver was the assumption of the learned trial Judge. The appellant further i pointed out that since there are many legal and equitable defences, for a party to plead as the first and third defendants namely, the second and third respondents herein did, in the trial court, is to say the least, engage (sic) in a j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 313 a very wide traverse, so general that it becomes neither here nor there. It has in fact the potency of taking the opposing party by surprise vide George and others v Dominion Flour b Mills Ltd (1963) 1 All NLR 71 at 77; (1963) 1 SCNLR 117 and indeed runs contrary to the spirit and provision of Order 16 rule 11 of the High Court of Lagos (Civil Procedure) Rules, 1972 which provides as follows:– c “The defendant or plaintiff (as the case may be) must raise by his pleading all matters which show the action or counterclaim not to be maintainable or that the transaction is either void or voidable in point of law, and all such grounds of defences or reply as the case may be, as if not raised would be likely to take the opposite party d by surprise, or would raise issues of fact not arising out of the preceding pleadings, as for instance, fraud, Limitation Decree, 1966, release, payment, performance, facts showing illegality either by an enactment or by common law, or by the Law Reform e (Contracts) Act, 1961.” The courts have established over time and beyond contest it is argued and that the purpose of pleading is to narrow down the notice of parties what they are to face in court (sic). See f the cases Emegokwue v Okadigbo (1973) 4 SC 113; Lewis & Peat (NRI) Ltd v Akhimien (1976) 7 SC 157 (sic) were cited in support. The defence it is the appellant’s contention that there is the need for the respondent to plead it specifically g with adequate particularizations. See this Court’s decision in Adebanjo v Brown (1990) 3 NWLR (Part 141) 661 and if it is a legal defence, it becomes a demurrer with the consequence that the respondents have admitted in its h totality, the case of the appellant but rely on the point of law. In the instant case, the respondents are enjoined by law to plead it. See Fadare v A-G, Oyo State (1982) 4 SC 1; FCDA v Naibi (1990) 3 NWLR (Part 138) 270 at 281 paragraphs E- F, where this Court cited with approval the Fadare case i (supra) (per Nnamani JSC) thus:– “It is also settled that some cases such as cases of demurrer, the defendant need not lead any evidence. He is in such a case taken to accept all the facts as established by the plaintiff but perhaps relies j on some point of law. See Fadare v Attorney-General of Oyo State

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(1982) 4 SC 1. Where a defendant relies on a special defence it is a trite that such a defence has to be specifically pleaded.” (Italics for emphasis.) The pleading of the respondents especially the third b respondent that they will rely on all legal and equitable defences, I agree is too vague and general and amounts to no traverse at all. In Adesanya v Otuewu (1993) 1 NWLR (Part 270) 414 at 455 paragraphs D – F this Court had c occasion to comment on the weight of a general traverse as follows:– “But I must ask myself– what is the value of such a general denial of important and material allegations of fact. The answer is of d course, nil. In saying so, I shall reiterate what this court had to say, per Idigbe, J.S.C., about general denials in the case of Messrs Lewis & Peat (NRI) Ltd. v Akhimien (1976) 7 SC 157 at 163 – 4 where he stated– ‘we must observe however that in order to raise an issue of fact in these circumstances there must be made a e proper traverse, and a traverse must be made either by a denial or non-admission either expressly or by necessary implication. So that if a defendant refuses to admit a particular allegation in the statement of claim, he must state so specifically . . .’”. f Finally, I agree with the appellant’s submission that the defence of waiver is not pleaded and the trial court and the court below were wrong in holding otherwise since parties and court are bound by pleadings proved at the trial. See g Adesanya v Otuewu (supra). Mindful of the fact that the court cannot raise the issue of waiver suo motu and place reliance on it in reaching a decision, adding that this Court has always held that courts should refrain from making out a h case for a party which he does not make himself. See per Kawu JSC in Adebanjo v Brown (supra) at page 675. It is a trite principle of law, emphasised by the appellant, that parties are bound by the pleadings and evidence while a i matter not pleaded goes to no issue vide Akpapuna v Obi Nzeka II (1983) 2 SCNLR 1; Laguro v Toku (1992) 2 NWLR (Part 223) 278; FHA v Sommer (1986) 1 NWLR (Part 17) 533. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 315 a Furthermore, since no defence of waiver was pleaded, the court cannot rely on it to find in favour of the defendant. It is noteworthy to point out that the only time when the issue of b waiver was raised at the trial of this action was during address by the Counsel to the third respondent qua fourth defendant, adding that the Counsel’s oral address or brief of argument however sound, cannot be a substitute for credible evidence upon which the court is obliged to rely upon in c reaching a decision. In fact, the address of Counsel is supposed to deal only with the evidence before the court and not to supplant the inadequacy of evidence given at the trial. See Salawu Yoye v Olubode and others (1974) 10 SC 209 at d 215, where Ibekwe JSC held thus:– “We would only point out however, that, as far as the facts of any given case are concerned, the address of counsel is supposed to deal only with the evidence before the court. But the mere mention e of a matter in the course of such address is never a substitute for the evidence that has not been led. Nor can it supplement the inadequacy of the evidence already given at the trial.” See also Bello v NBN Ltd (1992) 6 NWLR (Part 246) 206 at f 220, paragraphs B – C wherein Achike JCA as he then was had this to say:– “It must be stressed that mere submission of counsel no matter how alluring can never serve as substitute for the evidence – oral or documentary – necessary to construe the law.” g See also the two similar Supreme Court decisions of Niger Construction Ltd v Okugbeni (1987) 4 NWLR (Part 67) 787 cited in support thereof by Edozie JCA as he then was in h Igwe v AICE (1994) 8 NWLR (Part 363) 459 at 481 paragraph B. I therefore share the appellant’s view that since the respondents qua defendants in trial court did not plead “waiver” no evidence was given in support thereof and Counsel cannot provide such a serious missing link by way i of oral address. Consequently, the trial court and the Court of Appeal lack the requisite competence to rely on the submission of Counsel to anchor their judgments on the unpleaded defence of a waiver since waiver must be j specifically pleaded.

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Issue No. 2. a Whether or not the endorsement of the three (3) drafts, exhibits “8”, “8A” and “8B” by the third respondents to the appellant was a mere formality or a recognition of the third b respondent’s continued indebtedness to the appellant. (Grounds 2 and 3). By a letter dated 21 May, 1975, the third respondent bank third respondent has accepted to pay to the appellant the sum c of $5,293,781.97 and obtain the acceptance of the second respondent (AO Obikoya & Sons Ltd) to the three (3) drafts exhibit “8”, “8A” and “8B” totalling $1,700,000 which was also to be paid to the appellant. These were to be the final d sums which the appellant was entitled to from the contract of supply of motor spare parts which it had with Continental Motors and Engineering Company Ltd now under receivership of the first respondent. Be it noted that at all e material times, the third respondent was the guarantor of the contract sum, the letter under reference was received in evidence in the trial court as exhibit “6” (see pages 407-408 of the records). The said letter was predicated upon the Deed f of Agreement executed on 20 May, 1975 by the representatives of the appellants, the second and the third respondents. Be it noted that in the said Deed of Agreement, appellant was to forego the winding-up of the third g respondent who in turn was to take absolute responsibility of paying the indebtedness of the Continental Motors and Engineering Company Ltd to the appellant vide exhibit “5” at pages 402 – 407 of the records. By Clause 4 of the Deed h of Agreement, third respondent unequivocal (sic) substituted the contract of guarantee for personal liability. The legal consequence of exhibit “5”, particularly clause 4 thereof is that third respondent is to all intents and purposes now the principal debtor to the appellant or that its liability as a i guarantor will continue or be reinforced since it is now undertaking to pay the contract sum even by itself. The law is settled that the creditor will not discharge a surety if he has ceased to be a surety and become himself the principal j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 317 a debtor, or has previously paid part of the debt given as security for the remainder. See Halsbury’s Laws of England (4ed) Volume 20, page 158, paragraph 291 where the b learned authors stated as follows:– “A release of the principal debtor by the creditor will not discharge the surety if he has ceased to be a surety and become himself a principal debtor, or has previously paid part of the debt and given a security for the remainder, or has, in consideration of an c extension of time to himself by the creditor, bound himself without the principal debtor’s concurrence to pay the whole sum for which he was originally surety only, or has expressly agreed to remain liable, so that there is then no ground for the presumption that he is d impliedly discharged.” It is then stressed and I agree, that in the case in hand, the third respondent has become personally liable though flowing from the reason of its (guarantorship) to the e appellant when it signed exhibit “5”. Furthermore, the third respondent had paid part of the debt and promised to complete same by issuance of three drafts endorsed to the appellant and by this, the third respondent expressly f undertook to remain liable. From exhibit “5”, it is also evident that the former principal debtors to wit, Continental Motors & Engineering Company Ltd, were not parties to the agreement and this should mean that their involvement in g the issuance of the three (3) drafts should not affect the liability of the third respondent to the appellant. I agree with the third respondent’s submission that since it in effect assumed personal liability of the debt to the h appellant, it cannot in any way be exempted from liability when the indebtedness has not been satisfied, the obligation imposed on it by exhibit “5” being to pay the sums of US $5,293,781.97 and US$1,700,000. Two modes, it was i stressed were stipulated by the agreement for the payment of the two sums by third respondent giving instructions to the Central Bank of Nigeria and/or the third respondent’s foreign correspondents within 48 hours of the meeting j where the agreement was made to pay appellant.

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This, it was demonstrated, was complied with by the a applicant as evidenced by exhibit “6”. The second mode adopted by the agreement which was to be for payment of the remaining sum ie US$1,700,000 it is b added, was stated in exhibit “5”, page 404 of the records as follows: “The bank would draw three drafts on Messrs A. Obikoya & Sons Ltd for c (a) $500,000 due 1/12/75; (b) $600,000 due 1/12/76; and (c) $600,000 due 1/12/77 totalling US$1,700,000. These drafts would be accepted by Messrs d A. Obikoya & Sons Ltd and returned to the Bank within 7 days from the date of this agreement. The bank will endorse these drafts to the Romanians, without recourse to the bank as full and final payment for the balance of all e amounts due to the Romanians.” Appellant further submitted that in trying to pay the above sum this stipulated mode was not followed. Rather, it was added, the drafts were drawn by the receiver/manager of the f first respondent. The three (3) drafts, having been drawn on Continental Motors and Engineering Ltd having been endorsed to second respondent who in turn endorsed same to third respondent which in compliance with the plan contained in exhibit “5”, then endorsed it “without recourse” g to the appellant. In addition, it was submitted that the mere fact that a stipulated mode or method of payment of debt fails does not dispose of the debt, neither will it have the effect of discharging the obligation on the debtor. It is h therefore contended that the obligation on the debtor can only be discharged when the debt has been settled. The fact that the creditor waited to see whether the method adopted in trying to pay him will or will not succeed i does not mean that he has waived his right of being paid by those who are jointly and severally liable to him. This is significantly the more so when the third respondent is now the principal debtor by virtue of exhibit “5”. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 319 a The court below and the court of first instance, it would appear, placed much emphasis on the mode of payment instead of the payment of the debt itself. Significantly, it is b not equitable in the least to discharge a debtor only on the ground that the method by which he intended to pay as per an earlier arrangement which was not adopted which led to the debt not being satisfied. What is more, it is the third c respondent which caused the confusion by not following the terms of exhibit “5” but in thus having suffered no damage as a result of reliance on the so called waiver by the appellant. Moreover, third respondent has not complained of being overreached by the action of the appellant in trying to d recover the debt. Neither, in my view has the third respondent been in any way, a victim of the so called forbearing conduct of the appellant. The lower court was not correct, in my view, to absolve the third respondent of e responsibility in respect of the debt. In this regard, I agree with the appellant that it is only when the act of the appellant is aimed at overreaching or the third respondent has fallen victim of the purported forbearing conduct of the f appellant that the appellant can be restrained by equity to insist on its right. See REAN Ltd v Aswani Textile Industries (1991) 2 NWLR (Part 176) 639 at 666 paragraph E–F where Tobi JCA as he then was said: g “There are however instances when in the interest of justice and fair play, a court of law can infer the existence of a forbearing conduct which has developed into a compromise. One of such instances is when the forbearer wants to take advantage of his own forbearing conduct with a view to overreaching his opponent who h is already the victim of the forbearing conduct. In such a situation, a court of law as a court of equity, is entitled to invoke the well established principles of estoppel by conduct.” I am therefore in agreement with the appellant’s submission i that in view of the fact that by exhibit “5”, the third respondent had assumed the position of the principal debtor due to initial guarantorship agreement, its liability remains until the total debt due to appellant is liquidated. I agree with j appellant also that it was in recognition of this fact that the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC 320 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) third respondent endorsed the drafts to the appellant which a drafts the appellant would not have been entitled to act upon if the third respondent had not so endorsed. It is for this reason that I agree with learned Counsel for appellant’s b submission that the court below was wrong to hold that the endorsement by the third respondent on the drafts in favour of the appellant were a surplusage. As a matter of fact, third respondent endorsed the three (3) drafts (exhibits “8” and c “8B” to appellant because it has legal and contractual duty to do so in accordance with the agreement contained in paragraph 4(ii) of exhibit “5”. Furthermore, I agree with appellant’s submission that the d third respondent is personally liable to the appellant under section 55(2) of the Bill of Exchange Act in that the third respondent is an endorser of the three bills. This is because section 55(2) provides:– e “(2) The endorser of a bill by endorsing it–– (a) engages that on due presentment it shall be accepted and paid according to its tenor, and that if it be dishonoured he will compensate the holder or a subsequent endorser f who is compelled to pay it, provided that the requisite proceedings on dishonour be duly taken. (b) Is precluded from denying to a holder in due course the genuiness and regularity in all respects of the drawer’s signature and all previous endorsements. g (c) Is precluded from denying to his immediate or subsequent endorsee that the bill was at the time of his endorsement a valid and subsisting bill, and that he had then a good title thereto.” h Be it noted that the appellant promptly protested the non- payment of the drafts after the dishonour through a notary public, Mr Ladosu Ladapo, Esq., as earlier pointed out and as required by law, after which the appellant com- i menced this action in the High Court. In any case, it has never been the case of the respondents that the requisite proceedings were not taken by the appellant on dishonour of the drafts. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 321 a In the case in hand, it is not in dispute that the appellant is a holder of the bills. The court below so held on page 24 paragraphs 10 – 15 of its judgment (page 554 of the record b of appeal). However, the learned Justices of the Court below went ahead, erroneously in my view, to absolve the third respondent of liability by holding that it was not an acceptor. c Thus, I agree with the appellant that even though the third respondent may not be liable to it (appellant) as an acceptor of the bills, it still remains liable as an endorser of the bills. Had the two courts below considered the above section, they d would have reached a different conclusion. Therefore, I agree with the appellant further that pursuant to section 55(2)(c) of the Bills of Exchange Law, it does not lie in third respondent’s mouth to raise any (sic) as to the genuineness e or regularity of the drafts since it is an endorser of the bills. Further, I hold that the endorsement by the third respondent on the three drafts cannot be superfluous because under section 27(2) of the Bills of Exchange Act Cap 21 f (ibid) the third respondent is a party to the bill having signed it or endorsed it. This fact entitles the appellant to be a holder for value not only as regards the acceptor but all parties to the bill, including the third respondent. g Thus, even if the third respondent had signed the bill as a stranger, it still assumes the liability of an endorser. See sections 27(2) and 56 of the Act (ibid), the latter which provides:– h “Where a person signs a bill otherwise than as a drawer or acceptor, he thereby incurs the liabilities of an endorser to a holder in due course”. Also see the importance of section 30 of the same Bills of i Exchange Act which provides:– “Every party whose signature appears on a bill is prima facie deemed to have become a party thereto for value.” From the foregoing, it is evident therefore that the third j respondent is a party to the bills having endorsed them to the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC 322 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) appellant, and if the appellant has waived its right against a the third respondent, it must be by the mode provided under section 62(2) of the Bills of Exchange Act. The court below failed to consider section 62(2) of the b Bills of Exchange Act when it held that the entire section did not apply to this case in that the third respondent was not the acceptor of the bill. Had the learned justices of the Court of Appeal considered sub-section 2 of section 62 thereof, they c would have held third respondent liable as a party to the bill (not as an acceptor) and consequently, they would have also held that for the holder in this case, (the appellant) to renounce its right under the bill with respect to any party d to the bill, such renunciation must be in writing as provided in sub-section 1 of section 62 (ibid) which applies to acceptors. In the alternative, the appellant argued that Continental e Motors Ltd acted as the agent of the respondent in drawing the three (3) drafts. This fact was admitted at page 15 of the respondent’s brief in answer to the cross-appeal reproduced at page 502 of the records where the respondents f submitted:– “(i) Since in this case, the Continental Motors & Engineering Company Ltd was shown to have issued the draft instead of the respondent bank, it is submitted that the former being an g agent of the respondent bank, there is; in our considered opinion, no breach of the agreement dated 20 May, 1975 as what the agent did by issuing the drafts was deemed to have been done by its principal, the National Bank of Nigeria Ltd, but in this case both were protected from liability h having regard to the provision in the section “without recourse.” The appellant then contended that the phrases “without recourse” cannot avail any of the parties especially the i principal (National Bank of Nigeria, the third respondent) for which the Continental Motors were acting because it is against all known tenets of justice, rules of equity and notions of public policy for a party in crime (payment j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 323 a of the appellant with dud drafts) to be protected by any form of exclusion clause however wisely inserted not even by agreement of parties, since parties cannot by agree- b ment amend the criminal laws of the country by way of excluding a criminis party from liability. Accordingly, I agree with the appellant that since the third respondent did not draw the drafts in accordance with the agree- c ment (exhibit “5”) as found by the two courts below, it cannot be aided by the exclusion clause “without recourse” being the party in breach. See Suisse Atlantique Societe D‘armament Maritime SA v N V Rotterdamsche Kolen Centrale (1967) 1 AC 361; Charterhouse Credit Co Ltd d v Tolly [1963] 2 All ER 432; Karsales (Harrow Ltd) v Wallis [1956] 2 All ER 866 at 868; Boshali v Allied Commercial Exporters (1961) 1 All NLR 917; (1961) 2 SCNLR 322; See also Halsbury’s Law of England (4ed) e page 253, para 378. It was next argued on appellant’s behalf that since the exclusion clause “without recourse” cannot avail the third respondent, it means that it is liable as it would have been f without the clause and if Continental Motors was acting as agent to the third respondent in drawing the drafts, its action binds the bank (National Bank of Nigeria) wholly especially as it is a disclosed principal. The bank will then be directly g responsible for the liability incurred by its agents when it turned out that there is insufficiency of fund to satisfy the three (3) drafts. It is for this reason that I agree with the appellant that the court below was in grave error when it h absolved the bank (third respondent) of responsibility in the whole transaction. The trial court on page 373, paragraphs 10 – 15 of the record of appeal which holding was not appealed against that although there was an irregularity in i the mode of issue of drafts, that irregularity does not discharge the debt unless there are clear terms in the agreement that an acceptance of a defective draft absolves the parties liable and discharges the debtor from obligation j to pay.

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It is in the same wise that I agree with the appellant’s a submission that since there is no such clear agreement to absolve the debtors of their responsibility in case of any irregularity, the respondents who are jointly and severally b liable to pay the debt are still very much obliged to settle the bill of the appellant, and further to this is that the courts below are in grave error to have relied on the unpleaded doctrine of waiver to absolve the third respondent for the c liability incurred by its agents when it turned out that there is insufficiency of fund to satisfy the three (3) drafts. It is for this reason that I also agree with the appellant’s submission that the court below was in grave error when it absolved the bank (third respondent) of responsibility in the whole d transaction. The trial court had held that although there was an irregularity in the mode of issue of drafts, that irregularity does not discharge the debt unless there are clear terms in the agreement that an acceptance of a defective draft e absolves the parties liable and discharges the debtor from obligation to pay. Since there is no such clear agreement to absolve the f debtors of their responsibility in case of any irregularity, appellant asserts, the respondents who are jointly and severally liable to pay the debt are still much obliged to settle the bill of the appellant. Further to this is the fact that the courts below are in grave error to have relied on the g unpleaded doctrine of waiver to absolve third respondent of responsibility in respect of the payment of the outstanding US $1.7million, when there is no agreement to the effect that any of the parties to the agreement (exhibit “5”) will be h discharged when there is an irregularity in issuance of the bills. The appellant finally submits and I agree with it that the words “without recourse” cannot be an escape route as held i by the court below for the third respondent because the clause cannot be taken out of the contract for the purpose of interpretation. I am in agreement with the appellant that it should be interpreted having regard to other parts of the j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onu JSC Auto Import Export v Adebayo 325 a agreement (exhibit “5”) and that when this is done, it will be seen that the clause cannot have any meaning when other stipulations of the agreement are not complied with. b For the foregoing reasons and the fuller ones given in the judgment just delivered by my learned brother Oguntade, JSC with which I am in entire agreement, I too allow the appeal and make similar consequential orders as to costs as c contained therein.

KATSINA-ALU JSC: I have had the advantage of reading in draft the judgment of my learned brother, Oguntade JSC. d I agree with it and, for the reasons which he gives, I too, would allow the appeal and set aside the judgments of the two courts below. In their place, I enter judgment against the first, second and third defendants jointly and severally for e the sum of US $1.7 million. The judgment sum shall attract interest at the rate of 12% per annum from 2/12/77 until 16 July, 1986 when the judgment of the trial court was given and thereafter interest of 6% per annum until the judgment f debt and interest are fully paid. The appellant is entitled to costs of N10,000 against the third respondent.

MOHAMMED JSC: This appeal is against the judgment of g the Court of Appeal, Lagos Division delivered on 1/7/1996. In that judgment the appellant’s cross-appeal against the judgment of the Lagos State High Court of Justice of 16/7/1986, was dismissed. Aggrieved by this dismissal of its h cross-appeal, the appellant, which was the plaintiff at the trial high court and cross-appellant at the court below, has now appealed to this Court. In the appellant’s brief of argument, the following four i issues were distilled from the grounds of appeal:– “1. Whether the appellant had waived its right of recovering the balance of the debt of $1.7 million and interest from the 3rd respondent and whether the 3rd respondent can validly rely j on the defence of waiver where such was not pleaded.

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2. Whether upon a proper construction of exhibit 5, the a endorsement of the three (3) drafts, exhibits 8, 8A and 8B by the 3rd respondent was a mere formality or a recognition of the 3rd respondent’s continued indebtedness to the appellant and a duty under the Bills of Exchange Act to pay the said b sum of $1.7 million plus interest to the appellant. 3. Whether upon a proper construction of exhibit 5 the appellant’s right to payment against the 3rd respondent should be determined on the basis of the three (3) irregularly c drawn drafts, exhibits 8, 8A and 8B or its further amended statement of claim. 4. Given the circumstances of this case and upon a proper construction of exhibit 5, whether the words ‘without d recourse’ endorsed on the three drafts, exhibits 8, 8A and 8B operate to exclude the 3rd respondent from liability of paying the sum of $1.7 million plus interest given the circumstances of the transaction.” e A close scrutiny of the four issues above shows that a complaint touching on the liability of the third respondent to pay the appellant the remaining balance of the sum of $1.7 million debt, formed the kernel of the dispute for resolution in all the four issues concerned. In other words, this appeal f can be easily disposed off by the resolution of a simple and single issue of whether having regard to the obligations of the parties in this appeal under the deed of guarantee executed by the third respondent and the later agreement in g exhibit 5 between the parties, the third respondent has discharged its obligation to pay the appellant for the goods sold and delivered by it to the first respondent. h Starting with the obligation of the parties under the contract of guarantee executed by the third respondent in favour of the appellant, the record of this appeal particularly the further amended statement of claim of the appellant as the plaintiff at the trial high court, shows quite clearly i that the appellant’s reliefs sought in that court were partly grounded upon that deed of guarantee. Paragraphs 13, 14, 15, 24, 25, 26, 27 and 28 of the plaintiff’s further amended statement of claim at pages 261–262 and 267–268 j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Mohammed JSC Auto Import Export v Adebayo 327 a respectively of the record of the appeal which are instructive on the basis of the claim of the appellant against the third respondent in particular, are quoted below:– b “13. By a guarantee in writing dated 4 May, 1971, given by the 4th defendant to the plaintiff, the 4th defendant guaranteed to the plaintiff payment of the value of the various tractors and spare parts supplied by the plaintiff to the said Continental Motors and Engineering Company Ltd in accordance with c the said agreement dated 27 June, 1970 and the additional sales contract dated 4 May, 1971, and under the terms and conditions therein expressed. 14. It was further a term of the said guarantee that the said d guarantee shall be a continuing guarantee for all moneys due and payable and to become due and payable to the plaintiff as above. The plaintiff will at the trial of this action rely on the said guarantee for its full terms and effect. e 15. In pursuance of the said agreement, the said Continental Motors and Engineering Company Ltd got the 4th defendant to provide the necessary respective irrevocable Bank guarantee and, upon the 4th defendant opening the necessary respective irrevocable Letters of Credit in favour of the said f Auto-Tractor Bucharest at the 4th defendant’s London Branch, the various vehicles and spare parts as agreed under the said agreements shipped by the Auto-Tractor Bucharest to the said Continental Motors and Engineering Company Ltd in Lagos which took delivery of the same in Lagos, g between 1970 and 1972 at the total invoice price of US$9,324,565.58 24. The 4th defendant Bank then appointed Mr. J.A.A. Adebayo, as the Receiver and Manager of the said Continental Motors h and Engineering Company Ltd (the 2nd defendant) and called a meeting of the representatives of the plaintiff, A. Obikoya and Sons Ltd (the 3rd defendant) and the said Receiver and Manager to explore the possibilities of settling the outstanding account. i 25. The meeting was held in Lagos on the 20 May, 1975 and a Memorandum of Agreement dated 20 May, 1975 was drawn up and signed by the representatives of the plaintiff, A. Obikoya and Sons Ltd, the 4th defendant bank and the said j Receiver and Manager.

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26. Under the said Agreement, the 4th defendant agreed to pay a the sum of US$9,314,565.58 representing the invoice value only of all the vehicles, spare parts and components shipped to the said Continental Motors and Engineering Company Ltd by the 4th defendant, and also less an amount to be b agreed for which a draft was to be drawn by the 4th defendant on 3rd defendant and to be accepted by the 3rd defendant and endorsed by the 4th defendant in favour of the plaintiff in full and final settlement of the outstanding c account. 27. It was further agreed under the said agreement, inter-alia as follows– (1) The 4th defendant agreed to pay to the plaintiff by d giving instructions to the Central Bank of Nigeria and/or the 4th defendant’s Foreign Correspondents the sum of US$293,781.97. (2) The 4th defendant should draw three drafts on the 3rd defendant for– e (a) US$500,000 due on 1 December, 1975; (b) US$600,000 due on 1 December, 1976; and (c) US $600,000 due on 1 December, 1977 f Totalling US$1,700,000. These drafts should be accepted by the 3rd defendant and returned to the 4th defendant which should endorse them to the plaintiff in full and final settlement of the outstanding g account. The plaintiff will at the trial of this action, rely on the said drafts for their full terms and effect. 28. The said sum US$1,700,000 represents the value put on all the assets of the said Continental Motors and Engineering h Company Ltd excluding freehold landed properties which the said Receiver and Manager of Continental Motors and Engineering Company Ltd would transfer to the 3rd defendant under the said agreement.” The obligation of the third respondent to the appellant in i relation to the payment of the entire debt incurred by the first respondent is not at all in doubt taking into consideration the evidence of the appellant in support of those paragraphs of its further amended statement of claim j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Mohammed JSC Auto Import Export v Adebayo 329 a adduced at pages 302–303 by the only witness who testified for the plaintiff/appellant when he said:– “In 1975 4th defendant (now 3rd respondent in this appeal) issued b some bank guarantees. We called on the 4th defendant to pay up when Continental Motors (now 1st respondent in this appeal) failed to pay. We instructed a lawyer to take action to wind-up the Bank. The Bank then gave us a payment proposal in a letter. This is the letter tendered no objection admitted and marked exhibit ‘4’. c When the Bank defaulted on the proposal we gave our lawyer further instruction to wind up the bank for $40 million dollars. As a result of this step a meeting was held on 20/5/75 when a final agreement was reached and signed between representatives of our company, Eurhanmy manager/receiver Continental Motors, d Obikoya and the N.B.N. Ltd. This is the memo of agreement tendered. No objection admitted and marked exhibit 5. 4th defendant paid about 5 million dollars after exhibit 5 and we were informed in writing. Letter tendered, no objection admitted and marked Exhibit 6. We accepted the terms in exhibit 5 by a letter to e the 4th defendant. No objection admitted and marked exhibit 7. We are now waiting for the payment of $1.7 million dollars.” Although this witness was crossed-examined at page 304 of the record, his evidence-in-chief as to the liability of the f fourth defendant which is now the third respondent in this court, to pay the outstanding debt to the appellant, remained virtually unchallenged. No wonder, the agreement between the parties for the settlement of the debt in exhibit “5” in g order to keep the third respondent as a bank afloat, shows that the third respondent had already paid the sum of $7.5 million dollars of the appellant’s debt leaving a balance of only $1.7 million dollars. In this respect, from the part of the h pleading of the appellant earlier quoted in this judgment and the evidence adduced in support thereof, it is not at all in doubt that the third respondent as the bank which guaranteed the payment of the entire debt to the appellant, remained liable to pay the debt as long as the first respondent the main i debtor, was in default of payment. See Fortune International Bank Plc v Pegasus Trading Office (GMBH) (2004) 4 NWLR (Part 863) 369 at 389; African Insurance Develop- ment Corporation v Nigeria Liquefied Natural Gas Ltd j (2000) 4 NWLR (Part 653) 494 at 505 – 506.

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The next question for determination reading (sic) the a liability of the third respondent to pay the remaining balance of the debt of $1.7 million dollars to the appellant, is whether the appellant had waived the liability of the third b respondent by accepting and agreeing with the mode of payment through three separate bank drafts endorsed by the third respondent ‘without recourse’ to it in satisfaction of full and final payment to the appellant when these drafts c were returned unpaid because there were no funds in the account of the second respondent on which the drafts were drawn? The trial court and the court below relied heavily on the interpretation of the term “without recourse” used by the third respondent on each of the bank drafts, in Jowitt’s d Dictionary of English Law and Black’s Dictionary of English Law, which gave the meaning of the term as, “without further liability”. This interpretation was upheld by the trial court and affirmed by the court below in e exonerating the third respondent from further liability in paying the remaining sum of $1.7 million dollars to the appellant. To me, the appellant’s complaint that the stand taken by the lower court was wrong in law, appears to be f well-founded. The transaction involved in the implementation of the terms of the agreement between the parties in this appeal in exhibit “5”, involved a mode of payment in bank drafts spanning over a period of two years. There is no g doubt at all that the transaction was carried out under the Bills of Exchange Act which contains relevant provisions on the respective rights of the parties. Sections 16 and 62 of this Act which are relevant in the determination of whether or h not the appellant was deemed to have waived its right to have recourse to the third respondent for the payment of the remaining debt when the second respondent failed to pay, are as follows:– i “16. The drawer of a bill and any endorser may insert therein an express stipulation– (a) negativing or limiting his own liability to the holder; (b) waiving as regards himself some or all of the holder’s duties j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Mohammed JSC Auto Import Export v Adebayo 331 a 62 (1) When the holder of a bill at or after its maturity absolutely and unconditionally renounces his rights against the acceptor, the bill is discharged and the renunciation must be in writing unless the bill is b delivered up to the acceptor. (2) The liability of any party to a bill may in like manner be renounced by the holder before, at, or after its maturity, but nothing in this section shall affect the c rights of a holder in due course without notice of the renunciation.” Taking into consideration the above provisions of the Bills of Exchange Act and the evidence on record on the d transaction between the parties in this appeal towards implementing the provisions or terms of the agreement in exhibit “5”, in the absence of clear evidence in writing signifying express waiver of rights, I am not prepared e to agree that the appellant had waived its rights to resort to the third respondent for the payment of the sum of $1.7 million dollars. This is because the evidence is quite clear from the record that the second respondent which assumed the new liability and responsibility of paying this f remaining sum of $1.7 million dollars to the appellant upon taking over the assets and liabilities of the first respondent which was the principal debtor, is certainly not in a position to pay this sum with virtually nothing in its account in the g bank. For the foregoing reasons and the fuller reasons in the lead judgment of my learned brother, Oguntade JSC, I will also allow this appeal. Accordingly this appeal is hereby h allowed. The judgments of the trial court of 16/7/1986 and that of the court below of 1/7/1996, are hereby set aside. In place of those judgments, judgment in the sum of $1.7 million dollars being part of the remaining balance of debt, i shall be entered for the plaintiff now appellant against the second, third and fourth defendants who are now first, second and third respondents respectively. I abide by the remaining orders on interest and costs as contained in the j lead judgment.

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OGBUAGU JSC: The facts in this case as presented by the a appellant, are agreed to and adopted by the respondents. In other words, the facts are not in dispute as painstakingly treated in the lead judgment of my learned brother, b Oguntade JSC. There is no doubt in my mind and as rightly held by the court below at pages 547 and 548 of the records, that:– “Unfortunately, the three drafts, exhibits 8, 8A and 8B, were c drawn by the 3rd respondent on the Continental Motors, were accepted by the appellant, endorsed them to the 3rd respondent who then endorsed them ‘without recourse’ to the plaintiff/ respondent ‘incomplete breach of the provisions of exhibit 5, clause 4 (ii). When exhibits 8, 8A and 8B were presented for d payment, they were dishonoured as the appellant failed to supply the necessary funds to pay for them’.” (Italics mine.) What becomes plain to me, are:– “i. That the said drafts/bills were dishonoured. Reason– e Because of insufficient funds in the account of the 2nd respondent in Wema Bank. ii The 3rd respondent guaranteed payment. iii The 1st respondent, is still having or enjoying the goods f supplied. iv That the amount of US$1.7 million dollars remain unpaid.” Sincerely, the justice of this case, has compelled the appellant, to cry out to the high heavens and to this Court for g justice. This is because, the appellant is entitled to the money admitted by 1st, 2nd and third respondents, belongs to it. This is having regard to the undisputed findings of fact by the trial court at page 369 of the records, that the drafts h exhibits “8”, “8A” and “8B”, were dishonoured and that the appellant, duly protested by exhibits “9” and “9B” and that “The amount of $1.7 million dollars due on the said Bills remain unpaid hence this action”. i The learned trial Judge at the same page 369, had this to say, inter alia:– “The complaint arose because the proceeds of the bills of exchange were not paid to the plaintiff . . . It is not and cannot be j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC Auto Import Export v Adebayo 333 a disputed that the basis of this action is the agreement in exhibit 5. The question which I believe the court is called upon to decide is, which of the defendants 2 – 4 is liable to make good the sum due? b All of them deny liability. By exhibit 5, I do not see what action the 2nd defendant is expected to perform towards the payment of the sum due. The assets of the Company in liquidation have been transferred to and accepted by the 3rd defendant who c also admitted indebtedness to the plaintiff in the sum of $1.7 million dollars. Besides the uncontradicted oral evidence on this issue, the acceptance of the 3rd defendant in exhibits 8-8B is fully supportive of that fact admission. It is equally not d disputed that the bills of exchange were issued contrary to the terms in exhibit 5. Instead of the Bank i.e. the 4th defendant issuing the drafts, they were issued by the 2nd defendant. Of course under the agreement 2nd defendant had no obligation to issue the drafts. Those drafts were therefore wrongly issued”. e (Italics mine.) Of course, these are all findings of fact by the learned trial Judge. The lower court, indeed and in clear language at page 557 lines 13 to 17, stated as follows:– f “. . . The 3rd respondent, is not now turning back to claim the value of the three drafts, nor is he (sic) running away from liability as a result of committing any deliberate mistake. There is no evidence to that effect.” (Italics mine.) g Let me briefly touch/deal with the principle of waiver. The concept of waiver, is said to be that a person who is under no legal liability and having full knowledge of his right or interest conferred on him by law, and who intentionally, h decides to give them (or some of them) up, cannot be heard to complain that he has not been permitted to exercise those right or that he has been denied the enjoyment of those interests. See Ariori and others v Elemo and others (1983) 1 i SC 13 at 48 – 49; (1983) 14 NSCC 1 at 20; (1983) 1 SCNLR 1 at 25 – per Eso JSC; Ezomo v Oyakhire (1985) 1 NWLR (Part 2) 195; Adegoke Motors Ltd v Adesanya and another (1989) 3 NWLR (Part 109) 250 at 292; (1989) 5 SCNJ 80 – j per Karibi-Whyte JSC.

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Waiver is defined as the abandonment of a right. a However, to amount to a waiver – express or implied, two elements it is settled, must co-exist namely:– i. The party against whom the doctrine is raised, must b have knowledge or be aware of the act or omission which constitutes the waiver; and ii. He must do some unequivocal act adopting or recognizing the act or omission, See Olatunde v c Obafemi Awolowo University and another (1998) 5 NWLR (Part 567) 178; (1998) 4 SCNJ 59 at 79 – per Iguh JSC, in which the cases of Matthews v Smallwood (1910) 1 Ch 777 at 786; Fullers Theatre d and Vandeville Co Ltd v Rofe (1923) AC 435 (PC); Ariori and others v Elemo and others (supra) were referred to. In the case of Matthews v Smallwood (supra), it was held e that a right to re-enter under a lease, is not waived by the lessor, unless, knowing the facts on which the right arises, he does something unequivocal which recognises the continuance of the lease. f It need be stressed and this is settled, that waiver, is the intentional and voluntary surrender or relinquishment of a known privilege or right by a party entitled to the same, which, at his option, could have insisted upon. g As a matter of fact, it is said that waiver is not all that simple. See Fawehinmi Construction Co Ltd v Obafemi Awolowo University (1998) 5 SCNJ 44 at 54; (1998) 6 h NWLR (Part 553) 171. It is also said to be a curious phenomenon. That it can, in certain circumstances, be available to a plaintiff as well as to a defendant. That when available to a plaintiff, it is always that he needs not to plead it as such. That he can simply rely on the failure of i the defendant, to insist on a right to which he is entitled. See Prince Fasade and others v Prince Babalola and another (2003) 4 SCNJ 287 at 302; (2003) 11 NWLR (Part 830) 26. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC Auto Import Export v Adebayo 335 a Thus, in order to establish a waiver, it must be shown, that some step has been taken which is only necessary or only useful if the objection has been actually waived or has never b been entertained. See Saraki v Kotoye (1990) 4 NWLR (Part 143) 144; (1990) 6 SCNJ 31. In the case of Ariori and others v Elemo and others (supra) referred to (Part 523) 1; (1997) 7 SCNJ 600, Idigbe c JSC at page 22 of the NSCC Report, defining the word waiver, had this to say:– “By way of a general definition, waiver – the intentional and voluntary surrender or relinquishment of a known privilege and a d right, it therefore, implies a dispensation or abandonment by a party waiving of a right or privilege which at his option, he could have insisted upon.” Obaseki JSC on his part at page 25 of the same report, e opined as follows:– “Waiver is according to Words and Phrases legally defined Volume 5, page 301, 1969 Edt – reprinted 1874 defined as the abandonment of a right. A person who is entitled to the benefit of a statutory provision, may waive it and allow the transaction to f proceed as though the provision did not exist.” In the case of Bank of the North Ltd v Alhaji Bala Yau (2001) 5 SCNJ 168 at 192, (2001) 10 NWLR (Part 721) 408 – Karibi-Whyte JSC stated thus:– g “It is well settled that waiver is an abandonment of a right. Two elements must co-exist to constitute a waiver - First the party against who the doctrine is invoked must have knowledge or be aware of the act or omission which constitutes h the waiver and secondly, there must be on the part of the person against who (sic) the doctrine is invoked, some unequivocal act adopting or relinquishing the act or omission. See Olatunde v Obafem Awolowo University (1998) 5 NWLR (Part 567) 178.” i See also recently, the case of Eze v Okechukwu and others (2002) 12 SCNJ 258 at 271; (2002) 18 NWLR (Part 799) 348. It must always be borne in mind and this is also settled, j that waiver, may be inferred/implied by the courts from a

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC 336 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) conduct that is inconsistent with the continuance of a right a on minimum or slight evidence. For instance, section 50(2)(b) of the Bills of Exchange Act Cap 35 Laws of the Federation, 1990, provides for right of waiver. See Bank of b the North Ltd v Alhaji Bala Yau (2001) 5 SCNJ 168 at 184; (2001) 10 NWLR (Part 721) 408 – per Achike JSC (of blessed memory). In the case of Ross T Smith & Co. Ltd v TD Bailey Son & c Co [1940] 3 All ER 60 at 70 referred to in Eze v Okeclzukwu (supra), Lord Wright observed as follows:– “The word ‘waiver’ is a vague term used in many senses. It is always necessary to ascertain in what sense and with what d restrictions it is used in any particular case. It is sometimes used in the sense of election where a person decides between two mutual rights . . . I (sic) is also used where a party expressly or impliedly give (sic) up a right to enforce a condition or rely on a right rescind a contractor prevents performance, or any right by e laches.” Tobi JCA (as he then was) in the case of Carribean Trading & Fidelity Corporation v NNPC (1992) 7 NWLR (Part 252) 161 at 185; (in the appellant’s reply brief at page 7, the part f is erroneously stated to be 25) stated thus:– “Waiver carries some element of abandonment of a known legal right. By his conduct, the person gives a clear impression that he is not ready to pursue his legal right in the matter. He may not say so g in specific words. He may not say so at all. But once his conduct shows that trend, a court of law will hold that he has waived his right.” See also the definition of waiver in Black’s Law Dictionary, h (15ed) (sic) (it is 5ed) reproduced at pages 370-371 of the records. See also the definitions contained in the 6ed, page 1580 and now in the 7ed at page 1574. I respectfully, concede and agree, with the finding of my i learned brother, Oguntade JSC in the lead judgment, that there are facts duly pleaded by the first and third respondents in paragraphs 7(e) and 8 of their further amended statement of defence as appear at pages 327 to 339 j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC Auto Import Export v Adebayo 337 a of the records which constitute/amount to the defence of waiver. It seems to me, with respect, that all the other issues – b nos. 2, 3 and 4 of the appellant, deal with its same issue no. 1. I will however, make some additional contribution by way of emphasis. I have already stated herein above, that the payment of the said debt, was guaranteed by the third c respondent. Firstly, the purpose or why exhibit “5”, was entered into by the parties, is quite clear and not in doubt. Secondly, the third respondent had made a part-payment of the sum of d $5,293,781,92. Clause 3 of exhibit “5” reads as follows:– “A Testament tripartite agreement although not reduced into writing and signed by all the parties, had previously been reached by all the parties whereby the Bank (i.e. the 3rd respondent) would e pay only U.S$9,314,565.58 representing the invoice value only of goods shipped to Continental Motors and Engineering Company Ltd less a total of US$2,320,783.61 already paid by the Bank, and receipt of which was acknowledged by the Romanian.” (Italics f mine.) It is noted by me, that from Clause 1 of exhibit “5”, the said meeting of all the parties, was convened at the instance of the third respondent. The purpose of the said meeting:– g “Was to explore further, the possibilities of reaching agreement in respect of the settlement of all the indebtedness of Continental Motors & Engineering to the Romanians which transaction was guaranteed by National Bank of Nigeria Ltd (i.e. the 3rd h respondent).” (Italics mine.) Exhibit 5 was signed by all the parties and therefore in law, the contents, were binding on all of them. It is therefore, surprising to me why the parties, especially the first and i third respondents, are equivocating and shifting the buck, so to speak/as it were, in respect of the balance which appears to me, to be a smaller amount. It is noted by me, that even the trial court, found as a fact, that the third respondent j guaranteed the payment of the indebtedness.

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At page 366 of the records, the learned trial Judge at lines a 1 to 15 stated thus:– “The history of the case reveals the facts that Continental Motors and Engineering Company Ltd imported some goods from the b plaintiff for which no payment was made. That transaction was guaranteed by the 4th defendant the National Bank of Nigeria Ltd. When inspite of several demands for payment no settlement was reached, the plaintiff instruct edit’s (sic) (its) solicitor who commence (sic) (meaning to) commence winding up proceedings c against the defendant. Consequent on the threat posed by proceedings, a meeting was held between all the parties concerned in the transaction and an agreement reached which was committed to writing and evidenced by exhibit 5. It is that d agreement exhibit 5 which is the basis of the present action.” (Italics mine.) I will now deal with who is a guarantor and what a guarantee means. In the case of Trade Bank Plc v Khalid e Barakat Chami (2003) 13 NWLR (Part 836) 158 cited and relied on by the appellant, the Court of Appeal, stated/held at page 216 as follows:– “A guarantor is technically a debtor because where the principal f debtor fails to pay a debt, the guarantor will be called upon to pay the loan so guaranteed. The guarantor can however, be absolved from liability if he can show that the principal debtor has paid the loan”. (Italics mine.) As rightly submitted by the learned Counsel for the g appellant in their reply brief, in the instant case, the debt remains unpaid. In my respectful view and I so hold, that the third respondent as the guarantor, is liable to pay the same since the second respondent, is unable to pay, more h so, as the said cheques/drafts, were dishonoured by reason of the fact that the second respondent, did not have sufficient funds in its account with its bankers to take care of the indebtedness or for the sums stated in the said cheques/ i bills. In the case of Fortune International Bank Plc v Pegasus Trading Office (GMBH) and others, also reported in (2004) 1 SCNJ 292 and (2004) 1 SC (Part 11) 164, (Not Fortune j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC Auto Import Export v Adebayo 339 a International Bank Plc v Fimseno Holdings Nig. Ltd as cited by the appellant in its brief. Although, it is also reported in (2004) 4 NWLR (Part 863), the page is 369 and the ratio or b reference, is at page 389), this Court per Uwaifo JSC, stated/held that the tendency is that the law appears to have moved to the centre to make the right of the creditor less conditional. That the creditor is now entitled to proceed c against the guarantor, without or independent of the incident of the default of the principal debtor. The learned jurist referred to the views expressed in Andrew & Millet, Law of Guarantees (1ed) pages 162 – 163. The said principle or view, was approved by this Court in the case of African d Insurance Dev Corporation v Nigeria Liquified Natural Gas Ltd (2000) 4 NWLR (Part 653) 494 at 505 – 506; (2000) 2 SCNJ 119; (2000) 2 SC 57 – per Ayoola JSC to the effect that:– e “The fact that the obligations of the guarantor arise only when the principal has defaulted in his obligations to the creditor does not mean that the creditor has to demand payment from the principal or from the surety, or give notice to the surety, before the creditor f can proceed against the surety. Nor does he have to commence proceedings against the principal, whether criminal or civil, unless there is an express term in the contract requiring him to do so.” (Italics mine.) g Once again, by way of emphasis and this is also settled, the liability of the guarantor, becomes due and mature, immediately the debtor/borrower, becomes unable to pay its/his outstanding debt. The guarantor’s liability, is then h said to have, crystallized. See Royal Exchange Assurance (Nig) Ltd v Aswani Textiles Ltd (1992) 3 NWLR (Part 227) 1; (1992) 2 SCNJ 346; Eboni Finance & Securities Ltd v Wole-Ojo Technical Services Ltd and others (1996) 7 i NWLR (Part 461) 464 at 476 CA; Salawal Motor House Ltd and another v Lawal and another (1999) 9 NWLR (Part 620) 692 at 706 CA. I am aware and this is also settled, that a question arises as j to the manner a surety or guarantor becomes bound only to

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC 340 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) the letter of his engagement ie the guarantee agreement. The a answer is said to be that he/it, has no further liability outside the agreement, because he/it, normally receives no benefit or compensation. See the case of Gurara Securities & Finance b Ltd v TIC Ltd (1999) 2 NWLR (Part 589) 29 at 47 CA. In other words, the surety/guarantor is bound merely according to the proper meaning and effect of the written agreement. See also Rowlatt on Principal & Surety (3ed) page 102 and c Chitty on Contract, Volume 2, (24ed). From the above principles of law, I hold that the third respondent, certainly, is liable to discharge its obligations under the said guarantee. The second respondent and his d learned Counsel are right in not opposing this appeal. Their stance is not surprising to me. It is as expected. Afterwards, its appeal to the Court below, was struck out and it has not appealed against it in this Court. As I stated earlier in this e judgment, the said goods were sold and delivered to the first respondent and the goods were or are still in their possession. In its brief, it is stated/submitted at page2, inter alia, thus:– f “. . . As it relates to the 2nd respondent the success of this appeal does not discharge it of liability but only means that the 1st and 3rd respondents are jointly liable together with it . . .” (Italics mine.) g This, in my view, is an honest admission, that the appellant, is entitled to be paid the balance of the debt owed to it. The payment of the entire debt have (sic) been guaranteed by the third respondent. h Learned Counsel in the conclusion in their said brief, stated as follows:– “In conclusion, this Honourable Court is urged to allow the appeal i and hold that the 1st and 3rd respondents remain liable to pay for the balance of the goods sold and delivered to the1st respondent.” So be it. My answer therefore, to the lone issue of the second respondent, is rendered in the negative. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC Auto Import Export v Adebayo 341 a Finally, although there are concurrent judgments of two lower courts, there is again, the attitude of an appellate court such as this Court in respect thereof which is now firmly b established in a line of decided authorities to the effect, that concurrent findings of fact of two lower courts, will not be upheld, unless they can be justifiably defended from available evidence. See recently, Mojekwu v Iwuchukwu c (2004) 4 SCNJ 180 at 196 – per Uwaifo JSC (2004) 11 NWLR (Part 883) 196. In other words, the principle is said to have long been crystallized, that an appellate court, will not interfere with d the concurrent findings of two courts on issue of fact except there is (sic) established, a miscarriage of justice from perverse findings or violation of some principles of law or procedure. See Alhaji Ndayako & Jikantoro and others v e Alhaji Dantoro and others (supra) at 170 (2004) 5 SC (Part 11) 1; (2004) 13 NWLR (Part 889) 187 – per Edozie JSC, citing several cases therein, Francis C Arinze v First Bank of Nig Ltd (2004) 5 SCNJ 183 at 188; (2004) 12 NWLR (Part 888) 663 at 673; (2004) 5 SC 160 – per Belgore JSC, citing f also several cases therein and Mainagge v Gwamna (2004) 7 SCNJ 361 at 372; (2004) 7 SC (Part 11) 86; (2004) 14 NWLR (Part 893) 323 – per Akintan JSC also citing several cases therein. See earlier cases of Oladoye and others v The g Military Administrator, Osun State and others (1996) 12 SCNJ 192 at 207; (1996) 10 NWLR (Part 476) 38; Ume v Okoronkwo and another (1996) 12 SCNJ 404 at 413; (1996) 10 NWLR (Part 477) 133; Usman v Garke (2003) 7 SCNJ h 38 at 55; (2003) 14 NWLR (Part 840) 261 and First African Trust Bank Ltd v Partnership Investment Co Ltd (2003) 2 SCNJ 1 at 20; (2003) 18 NWLR (Part 851) 35 just to mention but a few. i Therefore, since the said practice of the Court is not to disturb or interfere with the concurrent findings of two lower courts, unless there are particular circumstances dictating otherwise – see Serbeh v Karikan (1939) 5 WACA 34; j Chinwendu v Mbamali (1980) NSCC 128; Ibodo and others

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Ogbuagu JSC 342 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) v Enarofia and others (1980) 12 NSCC 195; (1980) 5– 7 SC a 42; Enang and others v Adu (1981) 11 SC 25 and many others, the instant case leading to this appeal, in all the circumstances, is one of those, with respect, that this Court b will and must interfere with the said judgments of the two lower courts. The said judgment of the lower court, the Court of Appeal, affirming the decision/judgment of the high court, is hereby set aside by me. I hold that the third c respondent, is liable to pay the balance of $1.7 million dollars of the price/cost of the goods sold and delivered to the first respondent. It is from the foregoing and the fuller detailed judgment d of my learned brother, Oguntade JSC that I too, allow the appeal which is meritorious. I abide by the consequential orders including those in respect of costs. Appeal allowed. e

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Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 343 a Nigeria Deposit Insurance Corporation v O’Silvawax International Ltd and another b COURT OF APPEAL, ENUGU DIVISION OGEBE, ADEKEYE, MIKA’ILU JJCA Date of Judgment: 26 JANUARY, 2006 Suit No.:– CA/E/126/2001 c Banking – Banker/customer relationship – Whether within jurisdiction of Federal High Court – Section 250(1) 1979 Constitution amended by Decree No. 107 of 1993 Jurisdiction – Federal High Court – Banker/customer d relationship – Whether within jurisdiction of Federal High Court – Section 230(1) 1979 Constitution amended by Decree No. 107 of 1993 e Facts The brief facts of the case are that the second respondent Sylvanus Ifediegwu is the Managing Director of the first respondent O’Silvawax International Ltd. The second f respondent as a customer of the Co-operative and Commerce Bank (Nigeria) Plc. Niger Bridge Head Branch maintained a current account through which a loan of N1,800,000 (one million, eight hundred thousand Naira) was g approved for him on 18 May, 1993. As collateral for the loan, the second respondent deposited the customary right of occupancy in respect of his building at Odekpo. The deed of mortgage executed for the building could not be registered as the second respondent failed to obtain the consent of the h chairman of the Ogbaru Local Government in respect of his building and also omitted to submit his tax clearance certificate. The second respondent failed to refund his loan and as at 24 May, 1994, the loan together with the interest i stood at N2,241,834.41 (two million, two hundred and forty one thousand, eight hundred and thirty four Naira, forty one Kobo). Co-operative and Commerce Bank Plc became distressed which caused the bank to involve itself in a drive j to recover all the outstanding loans granted to its customers.

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During the process, the officials of the bank took three cars, a the property of the second respondent in distress in view of his outstanding loan, a Peugeot 505, a Mercedes Benz car and a Pathfinder Jeep. The second respondent brought an b action under the Fundamental Rights (Enforcement Procedure) Rules on 8 November, 1996. In granting the motion ex parte for leave, the Federal High Court ordered the release of the respondent’s cars. The bank filed a notice c of preliminary objection on 20 November, 1996 on the ground that the court lacked jurisdiction to entertain the application, it also opposed the substantive motion on notice by filing a counter-affidavit. The Co-operative and Commerce Bank went into liquidation before the d preliminary objection was heard, and the order for its winding-up was made on 12/3/98. The name of Co-operative and Commerce Bank was struck out in the suit on 26/4/99. The Nigeria Deposit Insurance Corporation thereupon e became the applicant in the motion for preliminary objection challenging the jurisdiction of the Federal High Court in the application brought pursuant to the Fundamental Rights (Enforcement Procedure) Rules. f The court heard the parties on the objection on 8 May, 2001. In his considered ruling delivered on 4 May, 2001, the learned Judge overruled the said preliminary objection and held that the court has abundant jurisdiction to hear and g determine the case on merit. Being aggrieved by the ruling, the Nigeria Deposit Insurance Corporation filed its notice of appeal to the Court of Appeal on 18 May, 2001. h

Held – 1. Although section 230(1) of the 1979 Constitution amended by Decree No. 107 of 1993, now in pari i materia with section 251(1) of the 1999 Constitution confers exclusive jurisdiction on the Federal High Court to adjudicate on matters connected with banks and banking thereby reducing the hitherto unlimited j

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Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 345 a jurisdiction of the High Court of various States, the High Court of a State still has jurisdiction to entertain claims connected with banks and banking except such claims b are connected with fiscal measures or revenue of the Federal Government. 2. Ordinary cases involving banker/customer relationship such as dispute in respect of overdraft, negligent c payments of forged cheques or negligent dishonouring of customer’s cheques and all banking transactions having nothing to do with the Federal Revenue fall within the jurisdiction of the State High Court. As this d appeal emanated from a dispute in respect of overdraft between a bank and its customer, it falls within the jurisdiction of a state High Court. The submission of the appellant that NDIC is a Federal Government Agency e and therefore the matter should be heard by the Federal High Court is irrelevant and inapplicable. Appeal allowed. f Cases referred to in the judgment Nigerian Adebayo v FCDA (1998) 6 NWLR (Part 552) 118 g Akinbode v Chief Registrar High Court of Oyo State and others (2003) 3 NWLR (Part 808) 585 Alli v Adesinloye (2000) 7 CRCN; (2000) 6 NWLR (Part 660) 177 h Anigboro v Sea Trucks (Nig) Ltd (1995) 6 NWLR (Part 399) 35 Bi Zee Bee Hotels Ltd v Allied Bank (Nig) Ltd (1996) 8 NWLR (Part 465) 176 i Bronik Motors Ltd v Wema Bank Ltd (1983) 1 SCNLR 296 CCB (Nig) Plc v Ozubu (1998) 3 NWLR (Part 541) 290 De Lluch v Societe Bancaire (Nig) Ltd (2003) 15 NWLR j (Part 842) 1

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Egbe v Adefarasin (1987) 1 NWLR (Part 47) 1 a FBN Plc v Jimiko Farms Ltd (1997) 5 NWLR (Part 503) 81 Holec Projects (Nig) Ltd v Dafeson International Ltd (1999) b 6 NWLR (Part 607) 490 Jammal Steel Structures Ltd v ACB Ltd (1973) 1 All NLR (Part 2) 208 Julius Berger (Nig) Plc v Omogui (2001) 15 NWLR (Part c 736) 401 Kokoro Owo v Lagos State Government (1995) 6 NWLR (Part 404) 760 d Kolo v Plc (2003) 3 NWLR (Part 806) 216 Nigerian Industrial Development Bank Ltd v Fembol (Nig) Ltd (1997) 2 NWLR (Part 489) 543 NIPOST v Adepoju (2003) 5 NWLR (Part 813) 224 e Oamen v Owenan (1993) 8 NWLR (Part 311) 358 Obiefuna v Okoye (1961) 1 All NLR 357 Okechukwu v Etukokwu (1998) 8 NWLR (Part 562) 513 f Omotayo v Nigerian Railway Corporation (1992) 7 NWLR (Part 254) 471 Onyenucheya v Mil Adm, Imo State (1997) 1 NWLR (Part g 482) 429 Owena Bank (Nig) Plc v Punjab National Bank (2000) 5 NWLR (Part 658) 635 h Peterside v IMB (Nig) Ltd (1993) 2 NWLR (Part 278) 712 Sea Trucks (Nig) Ltd v Pyne (1999) 6 NWLR (Part 607) 514 Sokoto Local Govt v Amale (2001) 8 NWLR (Part 714) 224 i Uka v Irolo (1996) 4 NWLR (Part 441) 218 Union Bank of (Nig) Plc v Intergrated Timber and Plywood Producers Ltd (2000) 12 NWLR (Part 680) 99 Uzoukwu v Ezeonu II (1991) 6 NWLR (Part 200) 708 j

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Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 347 a Nigerian statutes referred to in the judgment Companies and Allied Matters Act No 59 Laws of the Federation of Nigeria, 1990, section 38(1) b Constitution of the Federal Republic of Nigeria, 1979 as amended by Decree No. 107 of 1993, sections 40(1), 42(1), 230(1)(d) c Constitution of the Federal Republic of Nigeria, 1999, sections 44(1), 251(1)(d) Nigeria Deposit Insurance Corporation Act Cap 301 Laws of the Federation of Nigeria, 1990, sections 13(2), 22 d Torts Law of Anambra State Cap 135 of 1986, section 99(1)(b)

Nigerian rules of court referred to in the judgment e Fundamental Rights (Enforcement Procedure) Rules Cap 62 Laws of the Federation of Nigeria, 1990, Order 1 rule 3

Counsel f For the appellant: Ugolo For the respondent: Akputa

Judgment g ADEKEYE JCA: (Delivering the lead judgment) This is an appeal against the ruling of the Federal High Court, Enugu Division delivered on 4 May, 2001. The brief facts of the case are that the second respondent Sylvanus Ifediegwu is h the Managing Director of the first respondent O’Silvawax International Ltd. The second respondent as a customer of the Co-operative and Commerce Bank (Nigeria) Plc Niger Bridge Head Branch maintained a current account through i which a loan of N1,800,000 (one million, eight hundred thousand Naira) was approved for him on 18 May, 1993. As collateral for the loan, the second respondent deposited the customary right of occupancy in respect of his building at j Odekpo. The deed of mortgage executed for the building

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 348 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) could not be registered as the second respondent failed to a obtain the consent of the chairman of the Ogbaru Local Government in respect of his building and also omitted to submit his tax clearance certificate. The second respondent b failed to refund his loan and as at 24 May, 1994, the loan together with the interest stood at N2,241,834.41 (two million, two hundred and forty one thousand, eight hundred and thirty four Naira, forty one Kobo). Co-operative and c Commerce Bank Plc became distressed which caused the Bank to involve itself in a drive to recover all the outstanding loans granted to its customers. During the process, the officials of the bank took three cars, the property of the second respondent in distress in view of his d outstanding loan, a Peugeot 505, a Mercedes Benz car and a Pathfinder Jeep. The second respondent brought an action under the Fundamental Rights Enforcement Procedure Rules on 8 November, 1996. In granting the motion ex parte for e leave, the Federal High Court ordered the release of the respondent cars. The Bank filed a notice of preliminary objection on 20 November, 1996 on the ground that the court lacked jurisdiction to entertain the application, it also f opposed the substantive motion on notice by filing a counter-affidavit. The Co-operative and Commerce Bank went into liquidation before the preliminary objection was heard, and the order for its winding-up was made on g 12/3/98. The name of Co-operative and Commerce Bank was struck out in the suit on 26/4/99. The Nigeria Deposit Insurance Corporation thereupon became the applicant in the motion for preliminary objection challenging the jurisdiction of the Federal High Court in the application brought h pursuant to the Fundamental Rights (Enforcement Procedure) Rule. The court heard the parties on the objection on 8 May, 2001. In his considered ruling delivered on 4 May, 2001, the learned Judge overruled the said i preliminary objection and held that the court has abundant jurisdiction to hear and determine the case on merit. Being aggrieved by the ruling, the Nigeria Deposit Insurance Corporation filed its notice of appeal to this Court j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 349 a on 18 May, 2001. This Court also granted the appellant’s application for departure from the rules and ordered that the bundle of documents compiled and marked exhibit “A” by b the appellant be used as the record of appeal. Parties thereafter filed and exchanged briefs. When this appeal was heard on 30 November, 2005, the appellant adopted and relied on the appellant’s brief filed 14/6/2005. The c respondents adopted and relied on the respondents’ amended brief filed on 27/5/2005. In the appellant’s brief, four issues were distilled for the determination of this Court as follows:– d “(a) Whether the Federal High Court has jurisdiction to hear and determine this suit in view of the fact that it was filed sixteen months after the happening of the event contrary to Order 1 Rule 3 of the Fundamental Rights (Enforcement Procedure) Rules Cap. 62 Laws of the Federation of Nigeria, 1990. e (b) Whether the Federal High Court has jurisdiction to hear and determine this suit, which is a dispute between an individual Customer and his Bank in respect of transactions between individual Customer and the Bank. f (c) Whether the Federal High Court was right in law when he failed to rule on issues, which were properly raised before it. (d) Whether a dispute arising from a simple contract between an individual Customer and his Bank can be upgraded to a Fundamental Rights (Enforcement Procedure) Rules g action.” The respondents in their brief adopted the four issues formulated in the appellant’s brief as their own. The respondents incorporated in their brief, a preliminary issue h that this appeal CA/E/126/2001 is incompetent, as it is connected with the same issue raised in Suit No. CA/E/109M/97, which this same Court of Appeal determined on 29/3/99 and made the order that the appeal sought i to be facilitated by CCB (Nig) Plc is incompetent. Co-operative and Commerce Bank Plc was then dismissed as a dead person and as such cannot maintain any suit in court. The Federal High Court made an order winding- j up CCB (Nig) Plc on 12/3/98, and with that order, it has

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 350 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) seized (sic) to have legal personality and thus incapable a of maintaining a suit or prosecuting an appeal. Any order made against a non-existing party is ipso facto null and void. It is against this null order in FHC/EN/M129/96, that b the appellant is appealing. The appeal is consequently incompetent. The appellant in the reply brief referred to page 112 of the record of appeal. It is the proceedings of the court on 8 of c May, 2000 which reflected the parties and appearance. The parties were Nigeria Deposit Insurance Corporation as applicant and O’Silvawax International as respondent. The name of CCB Nig Plc was struck out from the suit, all facts d relating to the loan granted to the second respondent by CCB still subsisted, and the respondents did not apply to withdraw them. The applicant Nigeria Deposit Insurance Corporation is the liquidator of and former Managing Agent e of CCB. It has connection with this suit by way of recovery of the loan granted by CCB to the second respondent, hence, it has to be joined as a party in the suit. The lower court did not make an order against a non-existing party in effect, f CCB which is now dead following the courts Order of 12/3/98. This appeal is therefore competent. I do not need to belabour this issue. As has been rightly pointed out in the appellant’s reply brief, the parties to the g application for preliminary objection to the issue of the jurisdiction of the lower court are as shown at page 112 of the record. They are Nigeria Deposit Insurance Corporation as applicant and O’Silvawax International as respondent. h The name of CCB was struck out from this case through an application and by consent of Counsel for the parties on 26/4/99. It cannot therefore be resuscitated as a party on 4 May, 2000 by the same court. The order of the lower court being appealed against is a valid and subsisting order of that i court, which makes this appeal equally competent. The objection raised by the respondents to the competence of this appeal is thereby overruled. The issues for determination as settled by the appellants shall be considered by this Court j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 351 a for the purpose of this appeal. I shall however compress them into three as follows:– “(1) Whether Federal High Court has jurisdiction in this matter b which according to the Fundamental Rights (Enforcement Procedure) Rules is statute barred? (2) Whether a matter of breach of simple contract between a Bank and its Customer can now be altered to a Fundamental Rights action or an action to be heard exclusively by the c Federal High Court? (3) Whether the learned trial Judge was not in error to have omitted to rule on all the issues properly raised before him.” The applicant/appellant in the first issue for determination, d which is whether the Federal High Court has jurisdiction in the matter which according to the Fundamental Rights (Enforcement Procedure) Rules is statute-barred, submitted and referred to Order 1 rule 3(1) of the Fundamental Rights e (Enforcement Procedure) Rules Cap 62 Laws of the Federation of Nigeria, 1990, which stipulated that leave shall not be granted unless application is made within twelve months from the date of the happening of the event, matter f or act complained of, or such period as may be prescribed by any enactment. The cars of the respondent, subject matter of the application for enforcement of fundamental rights were g impounded on 24 July, 1995, while motion ex parte for leave was filed on 8/11/96. From the 24 July, 1995 to 8 November, 1996 is a period of sixteen months which is outside the twelve months prescribed by Order 1 rule 3 of h the Fundamental Rights (Enforcement Procedure) Rules. Throughout the motion papers, statement and affidavit, nowhere was the delay accounted for and the court was not urged to excuse the said delay of four months. i This suit was therefore statute-barred. The applicant/ appellant cited the cases of Omotayo v Nigerian Railway Corporation (1992) 7 NWLR (Part 254) 471 at 483 484; Anigboro v Sea Trucks (Nig) Ltd (1995) 6 NWLR (Part 399) j 35 at 58 – 59; Egbe v Adefarasin (1987) 1 NWLR (Part 47)

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1 at 20. Vide pages 4 29 and 32 61 of the record. The a respondent however replied that the twelve-month limitation period according to Order 1 rule 3(1) of the Fundamental Rights (Enforcement Procedure) Rules, is not applicable b where the wrong is a continuous wrong. An action can be brought outside the twelve-month period at any time during the continuation of the wrong. The act complained of by the respondents was continuous in nature, an action can be c brought under the 12-month period and at anytime during the continuation of the wrong. The respondents referred to the case of Uzoukwu v Ezeonu II (1991) 6 NWLR (Part 200) 708 at 759. d The second issue for determination is whether a matter of breach of contract between a bank and its customer can now be upgraded to a Fundamental Rights action, or an action to be heard exclusively by the Federal High Court? The e applicant/appellant argued and submitted that the issue involved in this matter is that of a simple contract between a Bank and its customer whereupon the customer failed to repay the loan granted to them by the bank, same cannot be upgraded to a Fundamental Rights (Enforcement Procedure) f Rules action. The claims of the respondents are proprietary in nature. Section 99(1)(b) of the Torts Laws of Anambra State, 1986, Cap 135 allows a bank to invoke a right of distress where a customer refused to liquidate a loan. g The appellant referred to the cases of CCB (Nig) Plc v Ozobu (1998) 3 NWLR (Part 541) 290 at 307 – 309; Peterside v IMB (Nig) Ltd (1993) 2 NWLR (Part 278) 712 at 731; Sea Trucks (Nig) Ltd v Pyne (1999) 6 NWLR (Part h 607) 514; Oamen v Owenan (1993) 8 NWLR (Part 311) 358 at 368; Holec Projects (Nig) Ltd v Dafeson International Ltd (1999) 6 NWLR (Part 607) 490 at 499; Sokoto Local Govt v Amale (2001) 8 NWLR (Part 714) 224 at 240 D – F. i The respondents adopted the wrong procedure by invoking the Fundamental Rights (Enforcement Procedure) Rules rather than seeking remedy by filing an ordinary writ of summons in the High Court of Enugu State. The appellant j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 353 a cited the case of Kokoro Owo v Lagos State Government (1995) 6 NWLR (Part 404) 760 at 765. The appellant also submitted that a limited liability b company cannot commence an action for infringement or contravention of Fundamental Rights under the Constitution or the (Enforcement Procedure) Rules, which covers only “every individual, every citizen, and a citizen”. A limited c liability company is not a human being. The appellant buttressed the submission with the case of Okechukwu v Etukokwu (1998) 8 NWLR (Part 562) 513 at 532. The relationship between the respondents and the Co- d operative and Commerce Bank of (Nig) Plc, now in liquidation and being represented by the Nigeria Deposit Insurance Corporation is that between an individual customer and his bank, as the respondents maintained an e account in CCB (Nig) Plc. Second respondent was granted a loan by the bank and the cause of the dispute was the refusal of the second respondent to refund the said loan granted to him by CCB. f In view of this relationship between the respondents and CCB as banker and customer relationship, the Federal High Court lacks jurisdiction to hear and determine the suit, as this has been ousted by the proviso to paragraph (d) of g section 230(1) of the 1979 Constitution as amended by Decree No. 107 of 1993, which is in pari materia with section 251(1)(d) of the 1999 Constitution. The appellant made reference to these cases:– Union Bank of Nigeria Plc v h Integrated Timber and Plywood Producers Ltd (2000) 12 NWLR (Part 680) 99; Bi Zee Bee Hotels Ltd v Allied Bank (Nig) Ltd (1996) 8 NWLR (Part 465) 176 at 185; Nigerian Industrial Development Bank Ltd v Fembol (Nig) Ltd (1997) i 2 NWLR (Part 489) 543 at 564; FBN Plc v Jimiko Farms Ltd (1997) 5 NWLR (Part 503) 81. The respondents replied that in this application, the acts of CCB and NDIC are in issue. By virtue of sections 13(2), 22 j and other sections of the NDIC Act Cap 301 Laws of the

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Federation, 1990, the NDIC is clearly an agent of the a Federal Government of Nigeria, the Federal High Court and no other court has jurisdiction in the suit. The respondent referred to the case of Onyenucheya v Mil Adm, Imo State b (1997) 1 NWLR (Part 482) 429 at 449. The respondents disagree with the submission that the subject matter of the dispute is that of simple contract. It is a case of violation of the respondents’ fundamental right to c enjoy his movable property as enshrined in section 40 of the 1979 Constitution. The appellant cannot seek a defence under the law of distress to justify the unconstitutional seizure of the respondents’ property or on the guise of a d simple contract. There is an equitable mortgage between the parties, which did not cover or envisage the seizure of the property of the respondents in the event of default of payment of the loan by the respondents. The right of distress in the appellant by seizure of the property can only amount e to defence of the respondents’ claim and not an issue that will ground the questioning of the courts jurisdiction. The issue of the loan transaction between the respondents and CCB cannot be relied upon by the appellant as a defence. f The appellant was not a party to the loan transaction and has no privity therein, and cannot rely on forceful seizure of the defendants’ property as a defence. The appellant has no legal right to project right of distress by CCB which is now g dead, as a defence. On the submission that the first respondent being a limited liability company is not capable of bringing an action under Fundamental Rights Procedure, the respondents submitted that the operative words in h section 42(1) of the 1979 Constitution and section 46(1) of the 1999 Constitution is any person. The combined reading of section 42(1) of 1979 Constitution, section 46(1) of the 1999 Constitution and section 38(1) of the Companies and Allied Matters Act Cap 59 Laws of the Federation of i Nigeria, the first respondent can enforce fundamental right claims under the 1979 or 1999 Constitution, as every company shall have all the powers of a natural person of full capacity. The relief claimed by the respondent is within the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 355 a ambit and the contemplation of section 40(1) of the 1979 and section 44 of the 1999 Constitution. Issue No. 3 is whether the learned trial Judge was not in b error to have omitted to rule on all the issues properly raised before him. The appellant recounted all the issues raised before the learned trial Judge in arguing the preliminary objection as follows:– c “(1) The issue that the motion for leave to enforce fundamental rights was brought more than twelve months from the date of the happening of the event. (2) The issue that in view of the proviso to Section 230(1)(d) of d the 1979 Constitution as amended by Decree No. 107 of the 1993, the Federal High Court has no jurisdiction to adjudicate on the dispute. (3) The issue that the subject matter of the dispute was a simple contract between the parties and same cannot be elevated to a e fundamental rights action in view of the right of distress permitted under Section 99 of the Torts Law of Anambra State.” The learned trial Judge recorded two of the foregoing f submissions but he failed to consider them in the ruling. It is the submission of the appellant that a court of law is bound to consider all issues submitted before it, failure to do so amounts to a miscarriage of justice. The appellant g cited cases of Uka v Irolo (1996) 4 NWLR (Part 441) 218 at 236; Adebayo v FCDA (1998) 6 NWLR (Part 552) 118 at 130 – 131. The respondent replied that it is not every error on appeal h that would result in setting aside a judgment but such error must be shown to be substantial and must have occasioned a miscarriage of justice which is not the position here hence the decision of the learned trial Judge should i not be tampered with. The respondent referred to the case of Alli v Adesinloye (2000) 7 CRCN; (2000) 6 NWLR (Part 660) 177. I have painstakingly considered the issues, the argument j and submission of the parties in this appeal. The first issue

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 356 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) for determination is for this Court to consider whether the a application of the respondents for the enforcement of their fundamental rights was statute barred. Their moveable properties – three cars, a Peugeot 504; a Mercedes car and a b Pathfinder Jeep of the respondents were seized by officials of the defunct Co-operative and Commerce Bank (Nig) Plc in their demand for the repayment of a loan granted by the bank to second respondent as a customer. This action was c claimed not to be in contemplation of the agreement between the parties when the loan was granted. The deed of mortgage in respect of the loan could not be registered as the second respondent failed to obtain the consent of the Chairman of his Local Government in respect of the d collateral of the mortgage, he also failed to submit his tax clearance certificate. Order 1 rule 3 of the Fundamental Rights (Enforcement e Procedure) Rules Cap 62 Laws of the Federation of Nigeria, 1990 stipulates that:– “Leave shall nor (sic) be granted to apply for an order under these rules unless the application is made within twelve months from the date of the happening of the event, matter or act complained of, or f such other period as may be prescribed by any enactment or except where a period is so prescribed the delay is accounted for to the satisfaction of the court or Judge to whom the application for leave is made.” g The contents of the foregoing statute are clear, straight forward, and unambiguous. In interpreting same, this Court has to adopt its literal or grammatical meaning. There is no reason or cause to import any other meaning into the statute h so as to bring out the intention of the draftsman. Any application or suit in contemplation of the fundamental rights enforcement procedure must be brought within a period of twelve months from the date of the i happening of the event, matter or act complained of– or (a) Such other period as may be prescribed by any enactment e.g. the limitation law of a state j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 357 a Except where a period is so prescribed, the delay is accounted for to the satisfaction of the court or Judge to whom the application is made. The Applicants before the b Federal High Court on 8 November, 1999 filed a motion ex parte under Order 1 rule 3 of the Fundamental Rights (Enforcement Procedure) Rules, 1979, praying the honourable Court for leave to institute proceedings against c the respondents to enforce the applicant’s right to property guaranteed by Chapter 4, section 40 of the 1979 Constitution as amended, and also for the court to compel the respondents to release forthwith his cars Peugeot 505, Mercedes Benz and Pathfinder to the applicant/respondent. d In the grounds for the application, the applicant/ respondent stated that on 24 July, 1995, the respondents without an enabling court order impounded the applicant’s e cars from his house and premises. In the affidavit verifying the facts in support of the application in paragraph 8 the second applicant/respondent stated:– “That the Respondent without sufficient Notice that my loan was over due for payment, forcefully invaded my premises on the 24 f July, 1995 and impounded my three cars Peugeot 505, Mercedes Benz car and Pathfinder all parked at Onitsha.” The application was specific on the issue of the date of the happening of the event, or the act complained of by them, g simply put at the 24 July, 1995. Between the date of the happening of the event or act complained of the 24 July, 1995 and the filing of the ex parte (sic) on 8 November, 1996 is sixteen months, which is four months outside the h twelve months prescribed by Order 1 rule 3 of Fundamental Rights (Enforcement Procedure) Rules. It is worthy of note that:– i (a) There is no other enactment prescribing the period for bringing this application; or (b) Throughout the motion papers, in the statement j and affidavit verifying facts relied upon in the

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application, this delay of four months was not a explained to court; and (c) There was no order made by court extending the limitation period beyond the twelve months b stipulated in the rules. Vide pages 4, 6, 7, 8, 30 – 31 of the record. In the respondents’ brief, the explanation to the four months is that the act complained of was a continuous wrong, and c by the authority of Uzoukwu v Ezeonu II (1991) 6 NWLR (Part 200) 708 at 759 an action can be brought outside the twelve months. I have to emphasise and explain that the event, matter or act complained of as specified in Order 1 d rule 3 of the Enforcement Procedure Rules in this case is not the loan or default in repayment of the loan, but the impounding or seizure of the cars of the second respondent from his premises and consequently paralyzing his activities. e This event took place on 24 July, 1995 and not on any subsequent dates. The vehicles were not seized by the Bank and its officials at any other dates. A continuous act is applicable to a case of a nuisance, which will be continuous f until abated. The cause of action shall continue to accrue at any date until the nuisance stops, which is not the position here. A cause of action accrues on a date when a breach or any event would warrant a person who is adversely affected g by the act of another to seek redress in court. A legal right to enforce an action is not a perpetual right but a right generally limited by statute. A cause of action will be statute-barred if legal proceedings cannot be commenced in h respect of same because the period laid down by the Limitation Law or Act has elapsed. If the date on the writ is beyond the period allowed by the Limitation Law then the action is statute-barred. Egbe v Adefarasin (1987) 1 NWLR (Part 47) 1; Anigboro v Sea Trucks Nigeria Ltd (1995) 6 i NWLR (Part 399) 35; Obiefuna v Okoye (1961) 1 All NLR 357; Kolo v Plc (2003) 3 NWLR (Part 806) 216; Akinbode v Chief Registrar High Court of Oyo State and others (2003) 3 NWLR (Part 808) 585. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 359 a In this appeal, the time between the date the cause of action accrued and when the action was filed going by the writ, falls outside the limitation period allowed by the b Fundamental Rights (Enforcement Procedure) Rules thereby making this action invalid and incompetent. Where the cause of action of the plaintiff is statute-barred, it affects the legal competence or jurisdiction of the court. Julius Berger (Nig) c Plc v Omogui (2001) 15 NWLR (Part 736) 401. The trial Court consequently had no jurisdiction to exercise in the matter which was then statute-barred. The first issue is resolved in favour of the appellant. d The second issue for determination is whether a matter of breach of simple contract between a bank and its customer can now be altered to a fundamental rights action or an action to be heard exclusively by the Federal High Court. e Section 230(1)(d) of the 1979 Constitution as amended by Decree No. 107 of 1993 is the law applicable at the time of the occurrence between the parties. In this appeal, section 251(1)(d) of the 1999 Constitution is in pari materia with f section 230(1)(d) of 1979 Constitution. Section 230(1)(d) of 1979 Constitution stipulates as follows:– “The Federal High Court shall exercise jurisdiction to the g exclusion of any other court in civil causes and matters arising from– (d) banking, banks, other financial Institutions. Provided that this paragraph shall not apply to any dispute h between an individual Customer and his Bank in respect of transactions between the individual customer and the Bank.” The interpretation of this proviso is that once it is ascertained that the plaintiff is an individual customer of the i Bank, the Federal High Court will not have jurisdiction to adjudicate in the dispute between that plaintiff and his bank. A proviso in a provision of a law is a clause of exception or qualification. It speaks the last intention of a legislature in j a statute. A section of an Act that contains a proviso must be

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 360 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) construed as a whole, each part throwing light on the rest. a NIPOST v Adepoju (2003) 5 NWLR (Part 813) 224. I have examined the applicant’s prayers before the Court, while (sic) the affidavit verifying the facts in support b indicate that there is a bank and individual customer relationship between the parties. The second applicant was in default in the repayment of the loan granted to him by the bank. The bank impounded his three vehicles so as to force c him to repay the loan. Although section 230(1) of the 1979 Constitution amended by Decree No. 107 of 1993, now in pari materia with section 251(1) of the 1999 Constitution confers d exclusive jurisdiction on the Federal High Court to adjudicate on matters connected with banks and banking thereby reducing the hitherto unlimited jurisdiction of the high court of various states, the high court of a state still has e jurisdiction to entertain claims connected with banks and banking except such claims are connected with fiscal measures or revenue of the Federal Government. That the ordinary banker/customer relationship is outside the purview f of paragraph (d) of section 230(1) of 1979 or 251(1) of the 1999 Constitution is supported by Supreme Court judicial authorities. Ordinary cases involving banker/customer relationship such as dispute in respect of overdraft, negligent g payment of forged cheque or negligent dishonouring of customer’s cheques and all banking transactions having nothing to do with the Federal Revenue fall within the jurisdiction of the State High Court. As this appeal emanated h from a dispute in respect of overdraft between a bank and its customer, it falls within the jurisdiction of a State High Court. The submission of the respondent that NDIC is a Federal Government Agency and therefore the matter should be heard by the Federal High Court is irrelevant and i inapplicable. Bronik Motors Ltd v Wema Bank Ltd (1983) 1 SCNLR 296; Jammal Steel Structures Ltd v ACB (1973) 1 All NLR (Part 2) 208; Owena Bank (Nig) Plc v Punjab National Bank (2000) 5 NWLR (Part 658) 635; De Lluch v j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 361 a Societe Bancaire (Nig) Ltd (2003) 15 NWLR (Part 842) 1; Union Bank of (Nig) Plc v Intergrated Timber and Plywood Producers Ltd (2000) 12 NWLR (Part 680) 99. b Under this issue, this Court has to consider whether breach of a simple contract that is a failure to liquidate a loan between a bank and its customer can now be converted to a Fundamental Right (Enforcement Procedure) Rules c action. The relevant provision of the Constitution relied upon is section 44(1) of the 1999 Constitution and Chapter 4 of the 1979 Constitution, section 40(1) which reads as d follows:– “Section 40 (1) No moveable property or any interest in an immovable property shall be taken possession of compulsorily and no right over or interest in e any such property shall be acquired compulsorily in any part of Nigeria except in a manner and for the purposes prescribed by a law. f (2) Nothing in subsection (1) of this section shall be construed as affecting any general law. a...... b...... g c. Relating to leases, tenancies, mortgages, charges, bill of sale or any other rights. Or obligations arising out of contract.” This section of the fundamental rights as regards com- h pulsory acquisition of any property shall not affect any general law affecting the matters and transactions mentioned in subsection (2) of the section. In effect, the Torts Law of Anambra State, 1986 shall be applicable regardless of the i law in respect of compulsory acquisition. Section 99(1)(b) of the Torts Law Cap 135 Laws of Anambra State, 1986 offers a defence to the appellant to take property by way of distress to recover a loan as in this j case and on the other hand, it offers the respondents as

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA 362 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) plaintiffs before a trial court remedy of damages following a a trespass to his goods or property or for an action in detinue. Vide Anambra State Torts Law, 1986. Section 42 of the 1979 Constitution and section 46 of the b 1999 Constitution states:– “Any person who alleges that any of the provisions of this chapter has been is being or likely to be contravened in any state in relation to him may apply to a High Court in that state for c redress.” The issue of distress in section 99(1)(b) of the Torts Law of Anambra State, 1986 was given recognition in the case of CCB (Nig) Plc v Ozubu (1998) 3 NWLR (Part 541) 290 d where distress is reckoned as essentially a common-law remedy whereby a person is empowered to enforce a legal right or obtain a redress for a civil wrong in a summary manner by seizing movable goods and keeping them as a e pledge until satisfaction is obtained. It is not open to a party to complain that he is wronged by an act, the doing of which the law permitted. Nothing lawful could be held illegal or unconstitutional. The seizure of the cars of the respondent is f recognised under the Torts Law of Anambra State, 1986, an action for breach of their Fundamental Rights cannot avail the respondents in the circumstance of this case. They have to seek remedy for their wrong in the High Court of Anambra State under the State Laws. Sokoto Local Govt v g Amale (2001) 8 NWLR (Part 714) 224. Moreover, section 44(1) of the 1999 Constitution and section 40 of the 1979 Constitution envisages a situation h where a property movable or immovable is required for acquisition for the good of the public as the property will be converted into public use. The owners of the property are entitled and are eligible to collect adequate compensation for the property under the law. The seizure of the cars of the i second respondent is not for the purpose of public good neither is the second Respondent entitled to any compensation thereafter. The second issue is hereby resolved in favour of the appellant. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Adekeye JCA Nigeria Deposit Insurance Corp. v O’Silvawax International Ltd 363 a The third issue is whether the Judge was not in error when he omitted to consider all the issues raised before him. In the preliminary objection before the lower court, the Counsel b raised three issues, but the learned trial Judge considered in detail the issue of jurisdiction of the Federal High Court based on section 40(1) of the 1979 Constitution, and the infringement of the property rights of the respondents. The c learned trial Judge failed to consider all the other issues, which queried his jurisdiction to hear the application brought under the Fundamental Rights (Enforcement Procedure) and the jurisdiction of the Federal High Court in the matter. Vide pages 112, 113, 117 – 118 and 120 – 123 of d the record. It is recognised that a Judge as an arbiter may have his or her unique style of judgment writing. It is also not expected that a Judge would write a judgment in which no mistake or fault can be found when appealed against. It is e the duty and role of a Judge, that the judgment or order of every court must demonstrate in full, a dispassionate consideration of all the issues properly raised and heard by the court. Where it failed to do so and a miscarriage of f justice is occasioned such judgment or order would be set aside by an appellate court. In the application before the lower court, it is obvious that the learned trial Judge hurriedly jumped into the conclusion when he said that:– g “This court has abundant jurisdiction to hear and decide the case on its merit”. It is obvious that he failed to give proper consideration to the legal implications in the application before the Court, h which the preliminary objection tried to highlight. It is the duty of an Appellate Court to wade into the matter and set aside the order made by the trial court in the circumstance of the case so as to correct any miscarriage of justice this ruling i had caused. In the final analysis, I hold that there is substance in this appeal, and the appeal is thereby allowed. The ruling of the Federal High Court is set aside and the action brought under j the Fundamental Rights (Enforcement Procedure) Rules

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Cap 62 Laws of the Federation of Nigeria, 1990 is hereby a struck out. Costs of N2,500 is awarded in favour of the appellant. b OGEBE JCA: I had a preview of the lead judgment of my learned brother Adekeye JCA just delivered and I agree entirely with his reasoning and conclusion. I also allow the appeal and abide by the consequential c orders including the order of costs made in the lead judgment.

MIKA’ILU JCA: I have had the opportunity of reading in draft the lead judgment just delivered by my learned brother, d OO Adekeye JCA. I agree with the reasons given therein and the conclusion reached. I find merit in the appeal and I allow it. I set aside the ruling of the Federal High Court and the action brought under the Fundamental Rights e (Enforcement Procedure) Rules Cap 62 Laws of the Federation of Nigeria, 1990 is hereby struck out. I award the same costs as in the lead judgment in favour of the appellant. f Appeal allowed.

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National Universities v Societe Generale Bank (Nigeria) Ltd 365 a National Universities v Societe Generale Bank (Nigeria) Ltd (No.1) b FEDERAL HIGH COURT OF NIGERIA, ABUJA DIVISION CHIKERE J Date of Judgment: 3 FEBRUARY, 2006 Suit No.: FHC/ABJ/M/293/05 c Banking – Banker/customer relationship – Whether Federal High Court has jurisdiction – Section 251(1)(d) Constitution of the Federal Republic of Nigeria, 1999 d Jurisdiction – Federal High Court – Banker/customer relationship – Whether Court has jurisdiction – Section 251(1)(d) Constitution of the Federal Republic of Nigeria, 1999 e Practice and procedure – Undefended list – Defendant raising preliminary objection – Not filing notice of intention to defend – Court overruling objection – Effect f Practice and procedure – Undefended list – Principles applicable

Facts g The plaintiff instituted this action against the defendant. The claim is for:– (a) recovery of the principal amount of N20 million (twenty million Naira only) fixed-term deposit h investment placed with the defendant on 4 March, 2003 together with interest at the rate of 18% per annum until the date of judgment, and thereafter interest at the rate of 10% per annum until final i liquidation, and (b) recovery of the principal amount of N200 million (two hundred million Naira only) fixed term deposit investment placed with the defendant on 15 July, j 2003 together with interest at the rate of 17% per

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annum until the date of judgment, and thereafter a interest at the rate of 10% per annum until final liquidation. The facts relied on are as set out in the affidavit in support of b the claim together with exhibits annexed thereto. On being served with plaintiff’s claim, the defendant did not file a notice of intention to defend but filed a notice of preliminary objection, challenging the jurisdiction of this Court to hear c and determine this suit. The main objection by the defendant is that by virtue of section 251(1)(d) of the 1999 Constitution, this Court lacks the jurisdiction to hear and determine this suit. Section 251 d of the 1999 Constitution deals with the jurisdiction of this Court. Section 251(1)(d) states thus:– “251 (1) Notwithstanding anything to the contrary contained in this Constitution and in addition to such other e 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– (a) relating to the revenue of the Government of the f Federation in which the said Government or any organ thereof or a person suing or being sued on behalf of the said Government is a party; (b) connected with or pertaining to the taxation of g Companies and other bodies established or carrying on business in Nigeria and all other persons subject to Federal taxation; (c) connected with or pertaining to customs and excise duties and export duties, including any h claim by or against the Nigeria Customs Service or any member or officer thereof, arising from the performance of any duty imposed under any regulation relating to customs and excise duties i and export duties; (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 j

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National Universities v Societe Generale Bank (Nigeria) Ltd 367 a banking, foreign exchange, coinage, legal tender, bills of exchange, letters of credit, promissory notes and other fiscal measures; b Provided that this paragraph shall not apply to any dispute between an individual customer and his bank in respect of transactions between the individual customer and the bank.” c The defendant’s Counsel also urged the Court not to proceed to give judgment for failure of defendant to file notice of intention to defend.

Held – d 1. The removal of exclusivity from the jurisdiction of the Federal High Court in respect of disputes between individual customer and his bank by the proviso in e section (1)(d) of Decree No. 107 of 1993 and section 251(1)(d) of 1999 Constitution does not mean that the Federal High Court ceased to have jurisdiction in respect of those disputes but it only means that the jurisdiction is not exclusive to the Federal High Court. It is pertinent to f observe that Decree No. 107 of 1993 ceased to have effect and was repealed by Decree No. 63 of 1999 with effect from 29 May, 1999. This means that section 251 of the 1999 Constitution now deals with jurisdiction and g powers of the Federal High Court in banking matters. (NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107 at 197 – 198 C – A refers.) 2. If the trial court had considered the preliminary h objection and overruled it, it would have proceeded to deal with the application before it if the business of the day permits. The appellant had all the opportunity in this world to have filed his notice of intention to defend and i his affidavit. If he solely relies on the notice of preliminary objection which is just like a gamble and if it is considered and it is overruled, he will have nothing to fall back on and he cannot complain that the trial j court is duty bound to grant him an adjournment so that

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he can put up a defence. This will be overstretching the a principle of the right of fair hearing which is nothing more than a litigant being given an opportunity to present his case before the Court. If you have all ample b opportunity and you do not use it, you cannot be heard when you start to cry of the infringement of your right to fair hearing because nothing has been infringed. The defendant had all the opportunity to file a notice of c intention to defend but decided to gamble with notice of preliminary objection. He does not have any other opportunity to file a notice of intention to defend. (Ogbani v Oti (2000) 8 NWLR (Part 670) 582 at 591 d refers.) 3. Under the undefended list, an application is made to the court for issue of a writ of summons in respect of a claim to recover a debt or liquidated demand. The application e is supported by an affidavit which is filed along with the writ, and which sets out the grounds of the claim and states that in the deponent’s belief, the defendant has no defence to the action. Once the court is satisfied that f there are good grounds for believing that there is no defence thereunto it shall enter the suit for hearing under undefended list and it will be marked accordingly. A copy of the affidavit is served with each copy of the writ, if the defendant is not disputing the claim, he does not g need to do anything. In that case, on the date fixed for hearing, judgment will be given for the plaintiff without him calling evidence in proof of his claim, unless the court, in its own discretion, in the interest of justice, h calls for oral or documentary evidence. Even if the defendant is present in court he cannot take part in the proceedings at the hearing. (Grand Cereals and Oil Mills Ltd v As-Ahel International Marketing and i Procurement Ltd (2000) 4 NWLR (Part 652) 310 at 322 refers.) 4. Where a defendant who has been served with the writ and the affidavit of the plaintiff, delivers to the Registrar j

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National Universities v Societe Generale Bank (Nigeria) Ltd 369 a not less than five days before the date fixed for hearing a notice in writing that he intends to defend the suit together with an affidavit setting out the grounds of his b defence, then the case shall be entered in the general cause list for hearing. (Olubusola Stores v Standard Bank of Nigeria Ltd (1975) 4 SC 51 refers.) 5. Where the defendant gives notice of his intention to c defend but his affidavit does not show reasonable grounds of defence the case will still be heard under undefended list. (ENDC v Durunna (1966–7) 10 ENLR 201 refers.) d Overruling the objection.

Cases referred to in the judgment Nigerian e Ansaldo Nigeria Ltd v National Provident Fund Management Board (1993) 3 NWLR (Part 174) 392 Grand Cereals and Oil Mills Ltd v As-Ahel Intl Marketing f and Procurement Ltd (2000) 4 NWLR (Part 652) 310 Madukolu v Nkemdilim (1962) 1 All NLR (Part 4) 587 National Ports Authority v Eyamba and others (2005) 12 NWLR (Part 939) 409 g NDIC v Okem Enterprises Ltd (2004) 10 NWLR (Part 880) 107 Ogbani v Oti (2000) 8 NWLR (Part 670) 582 h Yau v City Security Ltd (2003) FWLR (Part 165) 498 Nigerian statute referred to in the judgment Constitution of the Federal Republic of Nigeria, 1999, i section 251(1)(d), (q) Counsel For the plaintiff: Oladipo j For the defendant: Abule

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Judgment a CHIKERE J: Leave was granted to the plaintiff/applicant on 27/5/05 to issue a writ of summons against the defendant under the undefended list and to mark the writ of summons b “Undefended List” accordingly, and case adjourned for hearing. The defendants on 25/10/05 filed a notice of preliminary objection challenging the jurisdiction of this Court to hear and determine the issues as disclosed in the c suit. Parties tried out of court settlement, when that failed on 17/11/05 the court ordered that parties file written arguments to the preliminary objection. The defendant’s/applicant’s written argument is dated d 21/11/05 and filed on 22/11/05 while the plaintiff’s/ respondent’s reply opposing the application is [dated] 22/11/05 and filed on 23/11/05. Arguing the preliminary objection IM Abule, Esq. of e Counsel raised the issue of “whether or not this Honourable Court is competent to determine this suit on the Undefended List as initiated by the plaintiff”. Counsel contended that by virtue of section 251(1)(d) of the 1999 Constitution, this f Court lacks the jurisdiction to decide on a matter that is of a banking nature as in this suit, where the dispute is between an individual customer and his bank in respect of business transaction between the individual customer and the bank. g That the plaintiff is a statutory body corporate having been established under the Nigeria University Commission Act, 1974 Cap 283 Laws of Federation of Nigeria, 1990. That plaintiff falls under the proviso of section 251(1)(d) h of the 1999 Constitution, which provision divests this Court of jurisdiction to hear the present suit. That plaintiff/respondent did not comply with Order 24 Rules 1 – 5 in filing of this suit under the undefended list. i That since the suit was not filed or initiated by due process of law this Court cannot therefore exercise its jurisdiction and cited in support Madukolu v Nkemdilim (1962) 1 All NLR (Part 4) 587 at 589 ratio 6. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities v Societe Generale Bank (Nigeria) Ltd 371 a Counsel urged upon Court not to proceed to give judgment for failure of defendant to file notice of intention to defend as there are features which makes this suit b incompetent and cites Yau v City Security Ltd (2003) FWLR (Part 165) 498 at 803 ratio 11. TAB Oladipo, Esq.– opposing the notice of preliminary objection submitted that the plaintiff having been established c by virtue of National Universities Commission Act, 1974 Cap 283 Laws of the Federation of Nigeria, 1990 is an agency or organ of the Federal Government of Nigeria. That the funds of the plaintiff are funds of the Federal Government. d That the present action relates to the recovery of funds of the plaintiff and by extension the funds of the Federal Government and so by virtue of section 251(1)(d) of 1999 e Constitution, the Federal High Court has exclusive jurisdiction to hear and determine same, and cited in support the cases of Ansaldo Nigeria Ltd v National Provident Fund Management Board (1993) 3 NWLR (Part 174) 392 at 403; National Ports Authority v Eyamba and others (2005) 12 f NWLR (Part 939) 409 at 441. Counsel cited case of Nigeria Deposit Insurance Corporation v Okem Enterprise Ltd and others (2004) 10 NWLR (Part 880) 107 and submitted that this Court has g jurisdiction in cases or matters pertaining to banking. That the proviso to section 251(1)(d) is intended to relax the exclusiveness of the jurisdiction of the Federal High Court in cases or matter relating to banking, such that State High h Court may also have and exercise concurrent jurisdiction in such cases and matters and cited Nigeria Deposit Insurance Corporation v Okem Enterprise Ltd (supra) at 185 – 186 paragraph H – B. i Counsel argued that conditions for the exercise of Court’s jurisdiction are present ie that plaintiff is an organ of the Federal Government and the subject matter falls within the exclusive jurisdiction of this Court as stipulated in section j 251(1)(d) and (q) of the 1999 Constitution.

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He argued that Order 24 rules 2, 3(1) only requires service a of the writ of summons and affidavit setting forth the grounds upon which the plaintiff’s claim is served on the defendant. b That proceeding under the undefended list is a fast track one designed to accelerate the hearing of same and prevent abuse associated with the normal proceedings. c That by Order 24 rule 4 where the defendant neglects to deliver a notice of intention to defend and an affidavit disclosing a defence on the merit, the Court may proceed to give judgment without more. d Counsel finally urged Court to dismiss the preliminary objection and award judgment to plaintiff as claimed. The plaintiff instituted this action against the defendant. The claim is for:– e (a) recovery of the principal amount of N20 million (twenty million Naira only) fixed term deposit investment placed with the defendant on 4 March, 2003 together with interest at the rate of 18% per f annum until the date of judgment, and thereafter interest at the rate of 10% per annum until final liquidation, and (b) recovery of the principal amount of N200 million g (two hundred million Naira only) fixed-term deposit investment placed with the defendant on 15 July, 2003 together with interest at the rate of 17% per annum until the date of judgment, and thereafter h interest at the rate of 10% per annum until final liquidation. The facts relied on are as set out in the affidavit in support of the claim together with exhibits annexed thereto. On being i served with plaintiffs claim, the defendant did not file a Notice of Intention to defend but filed a Notice of Preliminary Objection, challenging the jurisdiction of this Court to hear and determine this suit. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities v Societe Generale Bank (Nigeria) Ltd 373 a The crux of the plaintiff’s case are to be found in paragraphs 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25 and 26 that is to say:– b “8. That the plaintiff desires to issue a Writ of Summons against the defendant claiming the recovery of fixed term deposit investments and interest as follows– ‘The plaintiff’s claim is for (a) recovery of the principal c amount of N20 million (Twenty Million Naira only) fixed term deposit investment placed with the defendant on 4 March, 2003 together with interest at the rate of 18% per annum until the date of judgment, and thereafter interest at the of 10% per annum until final liquidation and (b) d recovery of the principal amount of N200 million (Two Hundred Million Naira only) fixed term deposit investment placed with the defendant on 15 July, 2003 together with interest at the rate of 17% per annum until the date of judgment, and thereafter interest at the rate of 10% per e annum until final liquidation.’ 9. That the claim of the plaintiff arose from 2 distinct fixed term deposit investments made by the plaintiff with the defendant. The first deposit consisted of the principal amount f of N20 million (Twenty Million Naira only) invested with the defendant at its Abuja Branch for a tenor of 90 days at the interest rate of 18% per annum. Now produced shown to me and marked exhibit 1 is the plaintiff’s letter dated 26 February, 2003 advising the defendant of the investment. g 10. That in the letter dated 11 March, 2003 the defendant acknowledged the aforesaid fixed term deposit investment and further advised the plaintiff that the effective date of the investment was 4 March, 2003 maturity date was 2 June, h 2003, repayment date was 3 June, 2003 and interest payable at maturity was N887,671.23. Now produced shown to me and marked exhibit 2 is the aforesaid defendant’s letter dated. i 11. That upon maturity, the defendant issued its banker’s draft No. 1343332 dated 3 June, 2003 for the sum of N20 million fixed term deposit investment and delivered the same to the plaintiff under the cover of its letter of the same produced shown to me and marked exhibits 3 and 4 respectively are j the draft and the aforesaid letter.

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12. That in the plaintiff’s letter dated 2 July, 2003, and banker’s a draft and therein instructed the defendant to roll over the principal amount of the fixed term deposit investment of N20 million for a further term of 90 days at the rate of 18% per annum. Now produced shown to me and marked exhibit 5 is b the plaintiffs letter aforesaid. 13. That before the plaintiff could present the defendant’s banker’s draft for N887,671.23 (eight 3 herein) for payment through clearing, the defendant was suspended from the c clearing house by the Central Bank of Nigeria. 14. That the plaintiff is entitled to and claims contractual interest of the sum of N20,887,671.23 left unpaid by the defendant at the rate of 18% per annum from 3 June, 2003 d until the date of judgment and thereafter interest at the Court’s rate. 15. That the second fixed term deposit investment consisted of the principal amount of N200 million (Two Hundred Million e Naira only). In the plaintiff’s letter dated 27 June, 2003, the plaintiff advised the defendant that it had instructed Wema Bank Plc Airport Road, Abuja to transfer the sum N200 million (Two Hundred Million Naira only) to the defendant for investment at the interest rate of 17% per annum for a f tenor of 90 days with effect from the date of receipt of funds. The plaintiff also in the same letter instructed the defendant to acknowledge the investment by way of Deposit Receipt/Certificate. Now produced shown to me and marked exhibit 6 is the plaintiff’s letter. g 16. That the last – mentioned sum was paid to the defendant via the plaintiff’s Wema Bank Plc, Abuja Main Branch banker’s draft number 33562847 dated 8 July, 2003. Now produced shown to me and marked exhibit 7 is the banker’s draft for h the said sum of N200 million paid by Wema Bank Plc to the defendant on the plaintiff’s instruction. 17. That from exhibit 7, I know as a fact that the instrument was presented by the defendant for payment through the clearing i house on 9 July, 2003 and value was received for the full amount of N200 million (Two Hundred Million Naira only) on the instrument by the defendant on 15 July, 2003 and the term of the 90-day tenor thereby expired on 12 October, 2003. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities v Societe Generale Bank (Nigeria) Ltd 375 a 18. That the interest payable by the defendant to the plaintiff or the fixed term deposit investment of N200 million (Two Hundred Million Naira only) for the tenor of 90 days with effect from 15 July, 2003 to 12 October, 2003 at the rate of b 17% per annum is N8,383,561.64 and the plaintiff’s entitled to and claims contractual interest on the sum of N208,383,561.64 left unpaid by the defendant at the rate of 17% per annum from 13 October, 2003 until the date of c judgment and thereafter interest at the Court’s rate. 19. That on or about 14 July, 2003 and before the defendant could issue its Deposit Receipt/Certificate to the plaintiff, the defendant was suspended from the clearing house by the d Central Bank of Nigeria. 20. That following the suspension of the defendant from the clearing house, the plaintiff in the letter dated 16 July, 2003 recalled the principal amount of the fixed term deposit investments in the sum of N220 million (Two Hundred and e Twenty Million Naira only) together with accrued interest. Now produced shown to me and marked exhibit 8 is the plaintiff’s letter dated 16 July, 2003. 21. That in a reply dated 17 July, 2003, the defendant appealed f to the plaintiff to reconsider its request for recall of the fixed deposit investment of N220 Million (Two Hundred and Twenty Million Naira only) and interest and assured the plaintiff that the defendant was not distressed and would fulfil its financial obligation to the plaintiff by payment of g the principal and interest in full upon maturity. Now produced shown to me and marked exhibit 9 is the defendant’s letter dated 17 July, 2003. 22. That after maturity of the aforementioned fixed term deposit h investments, the plaintiff made repeated demands to the defendant by personal contact, telephone calls and letters requesting the liquidation of the principal amount of the investments and interest, but the defendant has made default i in liquidating the same. Now produced shown to me and marked exhibit 10 is the plaintiff’s letter dated 8 February, 2005. 23. That notwithstanding the demand and instruction of the plaintiff to repay the principal amount of the investments and j interest, the defendant has proposed to the plaintiff to convert

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the aforesaid fixed term deposit investments into ordinary a shares of the defendant. Now produced shown to me and marked exhibit 11 is the defendant’s letter dated 26 January, 2005. b 24. That at the Management Committee meeting of the plaintiff held in May, 2005, the proposal of the defendant to convert the fixed term deposit investments into shares of the defendant was rejected. 25. That as a result of failure of the defendant to repay the c principal amount of the fixed term deposit investments together with interest, the plaintiff has been unable to provide grants to federal universities to the extent of the default. d 26. That to the best of my knowledge the defendant has no reasonable defence to the plaintiff’s action.” The main objection by the defendant is that by virtue of section 251(1)(d) of 1999 Constitution, this Court lacks the e jurisdiction to hear and determine this suit. Section 251 of the 1999 Constitution deals with the jurisdiction of this Court. Section 251(1)(d) states thus:– “251 (1) Notwithstanding anything to the contrary contained in f 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 Court in civil causes and matters g (a) relating to the revenue of the Government of the Federation in which the said Government or any organ thereof or a person suing or being sued on behalf of the said Government is a party; h (b) connected with or pertaining to the taxation of Companies and other bodies established or carrying on business in Nigeria and all other persons subject to Federal taxation; i (c) connected with or pertaining to customs and excise duties and export duties, including any claim by or against the Nigeria Customs Service or any member or officer thereof, arising from the performance of any duty imposed under any j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities v Societe Generale Bank (Nigeria) Ltd 377 a regulation relating to customs and excise duties and export duties; (d) connected with or pertaining to banking, banks, b 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, bills of exchange, letters of credit, promissory c notes and other fiscal measures; Provided that this paragraph shall not apply to any dispute between an individual customer and his bank in respect of transactions between the d individual customer and the bank.” The Supreme Court in the case of NDIC v Okem Ent Ltd (2004) 10 NWLR (Part 880) 107 at 197–198 C–A interpreted this proviso as per Kalgo JSC to mean:– e “The removal of exclusivity from the jurisdiction of the Federal High Court in respect of disputes between individual customer and his bank by the proviso in Section (1)(d) of Decree No. 107 of 1993 and Section 251(1)(d) of 1999 Constitution does not mean f that the Federal High Court ceased to have jurisdiction in respect of those disputes but it only, means that the jurisdiction is not exclusive to the Federal High Court. It is pertinent to observe that Decree No. 107 of 1993 ceased to have effect and was repealed by Decree No. 63 of 1999 with effect from 29 May, 1999. This means g that Section 251 of the 1999 Constitution now deals with jurisdiction and powers of the Federal High Court in banking matters.” By the doctrine of stare decisis, I am bound by the decision h of the Supreme Court on this issue. I so hold. The other question is whether the plaintiff is an individual customer or an agent of the Federal Government. i It is not in contention between parties that the plaintiff was established under the Nigerian Universities Commission Act, 1974 Cap 283 Laws of the Federation of Nigeria, 1990. I agree with the plaintiff’s Counsel that the plaintiff is an j agent of the Federal Government and so section 251 of 1999

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Constitution gives this Court the jurisdiction to entertain a suit. The defendant’s Counsel also urged the Court not to proceed to give judgment for failure of defendant to file b notice of intention to defend. In the Court of Appeal case of Ogbani v Oti (2000) 8 NWLR (Part 670) 582 at 591 paragraphs A – C per Opene JCA, delivering the lead judgment held thus:– c “The learned counsel for the appellant has also submitted that even if the issue of jurisdiction is considered and the defendant is overruled that he will be entitled to an opportunity to put in his defence. d I entirely disagree with the learned counsel on this submission as it is not the correct statement of the law. If the trial court had considered the preliminary objection and overruled it, it would have proceeded to deal with the application before it if the business of the day permits. The appellant had all e the opportunity in this world to have filed his Notice of Intention to defend and his affidavit. If he solely relies on the Notice of Preliminary Objection which is just like a gamble and if it is considered and it is overruled, he will have nothing to fall back on f and he cannot complain that the trial court is duty bound to grant him an adjournment so that he can put up a defence. This will be over-stretching the principle of the right of fair hearing which is nothing more than a litigant being given an opportunity to present his case before the Court. If you have all ample opportunity and g you do not use it, you cannot be heard when you start to cry of the infringement of your right to fair hearing because nothing has been infringed.” The defendant had all the opportunity to file a Notice of h Intention to defend but decided to gamble with notice of preliminary objection. He does not have any other opportunity to file a notice of intention to defend. The defendant’s counsel also contended that the plaintiff/ i respondent did not comply with Order 24 rules 1 – 5 of Rule of Court. The Court of Appeal in the case of Grand Cereals and Oil Mills Ltd v As-Ahel International Marketing & Procurement j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities v Societe Generale Bank (Nigeria) Ltd 379 a Ltd (2000) 4 NWLR (Part 652) 310 at 322 paragraph B – F as per Umoren JCA delivering the lead judgment hold thus:– “Under the undefended list, an application is made to the Court for b issue of a writ of summons in respect of claim to recover a debt or liquidated demand. The application is supported by an affidavit which is filed along with the writ, and which sets out the grounds of the claim and states that in the deponents (sic) belief, the defendant has no defence to the action. Once the Court is satisfied c that there are good grounds for believing that there is no defence thereunto it shall enter the suit for hearing under undefended list and it will be marked accordingly. A copy of the affidavit is served with each copy of the writ, if the defendant is not disputing the claim, he does not need to do anything. In that case, on the date d fixed for hearing, judgment will be given for the plaintiff without him calling evidence in proof of his claim, unless the court, in its own discretion, in the interest of justice, calls for oral or documentary evidence. Even if the defendant is present in Court e he cannot take part in the proceedings at the hearing. (UAC (Technical) Ltd v Anglo Canadia Cement Ltd (1966) NMLR 349 Ikpeazu J (as he then was.) Where a defendant who has been served with the writ and the affidavit of the plaintiff, delivers to the Registrar not less than five f days before the date fixed for hearing a notice in writing that he intends to defend the suit together with an affidavit setting out the grounds of his defence, then the case shall be entered in the general cause list for hearing. g See Olubusola Stores v Standard Bank of Nigeria Ltd (1975) 4 SC 51. Where the defendant gives notice of his intention to defend but his affidavit does not show reasonable grounds of defence the case will still be heard under undefended list. (ENDC v Durunna (1966 – 7) 10 ENLR 201 referred to) Page 299 paragraph F).” h In the instant case, I am of the view that the plaintiff/ applicant has fulfilled the requirements for entering a suit under the undefended list. I so hold. i Now the question that arises for this Court to determine is – Is the defendant actually owing the plaintiff? The plaintiff/respondent in paragraphs 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24 and exhibits “1”, j “2”, “3”, “4”, “5”, “6”, “7”, “8”, “9”, “10”, “11”

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J 380 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) respectively has established the debt of N220 million (two a hundred and twenty million Naira) together with the accrued interest against the defendant. This is not denied. Accordingly, judgment is entered in favour of the plaintiff/ b respondents as per the claim.

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Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 381 a

Macpepple and another v Central Bank of Nigeria b and another FEDERAL HIGH COURT OF NIGERIA, PORT HARCOURT DIVISION NWODO J Date of Judgment: 8 FEBRUARY, 2006 Suit No.: FHC/PH/CS/1406/04 c Banking – Immunity of Central Bank – Section 49(1) Banks and Other Financial Institutions Act No. 25 of 1991 – Whether sustainable under the Constitution of the Federal Republic of Nigeria, 1999 d Injunction – Applicant applying for interlocutory injunction – What to show Injunction – Conditions for the grant of interlocutory e injunction Jurisdiction – Demurrer and jurisdiction – Where demurrer abolished – Whether application on jurisdiction can be filed f without statement of defence Practice and procedure – Demurrer – Abolition of – Issue of jurisdiction – Whether can be raised without statement of defence g Facts The Ruling is in respect of the motion on notice dated 12 July, 2004 seeking the following reliefs:– h 1. Pending the hearing and final determination of the substantive suit herein, an order of interlocutory injunction shall issue, restraining the defendants/ respondents generally and the first defendant/ i respondent in particular, from taking any step, whatsoever and however either by way of administrative or judicial action from removing the first plaintiff/ applicant from the Board of Fortune International j Bank Plc as a Director or interfering with his

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382 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a position in the said Bank, as threatened by the first defendants/respondent in its letter of 30 April, 2004. 2. An order of interlocutory injunction restraining the b first defendant/respondent from invoking any regulatory action of whatever type, including prosecution before any court of law or tribunal, against the first plaintiff/applicant, until a final determination of the substantive suit herein. c 3. An order of interlocutory injunction restraining the defendants/respondents from taking further steps of whatever kind on the relationship between the d second plaintiff/applicant and the second defendant/ respondent pending the final determination of the substantive suit herein. It was the contention of learned Counsel for the first e defendant that from the reliefs sought against the first defendant/respondent that applicants were invoking jurisdiction of this Court to make pronouncements on the regulating powers of the first defendant/respondent f enshrined in section 29(2) of Banks and Other Financial Institutions Act (BOFIA), 1999 as amended and code of conduct for Directors of Banks in Nigeria. He submitted that the Bank referred to in section 49(1) of BOFIA was the first defendant and therefore this Court was stripped of g jurisdiction to hear and determine the claims of the plaintiffs/ applicants against the first defendant/respondent and as sued. The Court was incompetent and forbidden to hear claims against Central Bank of Nigeria. He contended h further that if the Court was devoid of jurisdiction to hear a matter before it, then the basis of exercise of constitutional powers under section 6(1) and (6) of the Constitution is also absent. i Learned SAN IA Adedipe in reply on points of law contended that the incompetence of an action did not amount to want of jurisdiction. He submitted further if plaintiffs’ action could be challenged on want of competence at all it j

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Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 383 a could only be challenged on a statement of defence filed and in compliance with the provisions of Order 25 rules 2, 3 and 4 of Federal High Court (Civil Procedure) Rules, 2000 b because demurrer had been abolished. He submitted that the incompetence of the action had not yet been raised as required by law and did not affect jurisdiction but goes to merit of action. c He further submitted that the Court had jurisdiction to entertain both the action and the motion Section 49(1) of BOFIA provides that neither the Federal Government nor the first defendant shall be subject to any d action, claim or demand by or liability to any person for any act or omission in connection with power conferred on the Government or Bank by the Act. The interpretation section described the word “Bank” as the Central Bank of Nigeria e that is the first respondent.

Held – 1. The application to raise and argue the issue of f jurisdiction of a trial Court and of the competence of the other party can be accepted at any stage of the proceedings and even on appeal without the defendant filing his statement of defence. (Eze v A-G, Rivers State g (2001) 18 NWLR (Part 746) 524 refers.) 2. The conditions for grant of injunction are:– 1. Whether there is a serious question to be tried at the h substantive suit; 2. Balance of convenience; and 3. Inadequacy of damages. (Ogunsola v Usman (2003) FWLR (Part 180) 1465 refers.) i 3. The 1999 Constitution has under section 251(1)(d) provided specifically that the Federal High Court shall exercise exclusive jurisdiction in any action by or against the Central Bank of Nigeria arising from banking j matters. By this constitutional provision of 1999 the

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384 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a Central Bank of Nigeria cannot enjoy any immunity from action involving bank matters. A right conferred or vested by the Constitution cannot be taken away by any other statutory provision except by the Constitution b itself. (A-G, Osun State v International Breweries Plc (2001) 7 NWLR (Part 713) 647 refers.) 4. The 1999 Constitution is supreme. One must not forget the fact that BOFID, 1991 No. 25 was enacted as a c Decree during Military Regime. The present status has changed as regards access to court against the defendant. Section 251(1)(d) is clear on the current position that actions can be instituted against the first defendant in d banking matters. Banking and financial acts include powers conferred on defendant under BOFID. It is paramount to note that the Banks and Other Financial Institutions Act Cap B3 Revised Laws of the Federation e of Nigeria, 2004 which Act is to regulate banking and financial institutions omitted the provision under section 49(1) on immunity of the Central Bank of Nigeria. The present suit against first defendant is competent. f Application granted.

Cases referred to in the ruling Nigerian g Adeyemi v Opeyori (1976) 9 – 10 SC 31 A-G, Osun State v International Breweries Plc (2001) 7 NWLR (Part 713) 647 h Ajomale v Yaduat and another No. 1 (2003) FWLR (Part 182) 1902 Dongtoe v Civil Service Commission Plateau State (2001) 9 NWLR (Part 717) 132 i Eze v A-G, Rivers State (2001) 13 NWLR (Part 746) 524 Madukolu v Nkemdilim (1962) 2 SCNLR 342 Ogunsola v Usman (2003) FWLR (Part 180) 1465 j

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Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 385 a Total Nig Plc v VIIRA (2004) 7 NWLR (Part 873) 446 Usman v Baba (2005) 5 NWLR (Part 917) 113 b Nigerian statutes referred to in the ruling Banks and Other Financial Institutions Act Cap B3 Laws of the Federation of Nigeria, 2004, sections 29(2), 49(1) c Constitution of the Federal Republic of Nigeria, 1999, sections 6(1), 6(6), 251 Evidence Act Cap E14 Laws of the Federation of Nigeria, 2004, sections 86, 88, 89 d Federal High Court Act Cap F12 Laws of the Federation of Nigeria, 2004, sections 7(d),7(e)

Nigerian rules of court referred to in the ruling e Federal High Court (Civil Procedure) Rules, 2000, Order 25 rule 2, Order 25 rule 3, Order 25 rule 4

Counsel f For the plaintiff/applicant: Adedipe For the first defendant/respondent: Onyibo g Judgment NWODO J: This Ruling is in respect of the motion on notice dated 12 July, 2004 filed on 16 July, 2004 by the plaintiff/applicant wherein he seeks the following reliefs:– h I. Pending the hearing and final determination of the substantive suit herein, an order of interlocutory injunction shall issue, restraining the defendants/ respondents generally and the defendants/respondents i in particular, from taking any step, whatsoever and howsoever either by way of administrative or judicial action, from removing the first plaintiff/applicant from the Board of Fortune International Bank Plc as a j Director or interfering with his position in the said

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J 386 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a Bank, as threatened by the first defendants/respondent in its letter of 30 April, 2004; II. An order of interlocutory injunction restraining the b first defendant/respondent from invoking any regulatory action of whatever type, including prosecution before any court of law or tribunal, against the first plaintiff/applicant, until a final determination of the substantive suit herein. c III. An order of interlocutory injunction restraining the defendants/respondents from taking further steps of whatever kind on the relationship between the second d plaintiff/applicant and the second defendant/ respondent pending the final determination of the substantive suit herein. IV. Such further order(s) as the Honourable Court shall e deem fit to make in the circumstances of this case. In support of the application is a 37-paragraph affidavit deposed to by Henry Macpepple exhibiting Exhibit “A” to Exhibit “K”. f The first defendant filed on 21 October, 2004, a four- paragraph affidavit deposed to by Joe T A Gambo exhibiting Exhibits “A” to “D”. g The second defendant filed a counter-affidavit of eight paragraphs deposed to by Frimabo Warmate. On the directive of the Court the Learned SAN, I A Adedipe, SAN and the other learned Counsel filed and h exchanged written submissions in respect of the motion on notice. On 25 October, 2005 the learned Counsel for the plaintiff Chief IA Adedipe, SAN adopted his written submission filed i on 8 February, 2005 and reply on points of law filed on 7 October, 2005, Whilst the learned Counsel for the first defendant FU Onyibo adopted the written submission filed on 28 February, 2005 signed by Eni Akpodiete. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 387 a I refer to the detailed submissions of the learned SAN and the learned Counsel. Learned Counsel for the second respondent did not file any address. I have carefully b considered the averments in the affidavits in support, the submissions of the learned Counsel and issues raised and I have referred to the several cases cited by learned Counsel. The learned SAN formulated two issues for determination c and the learned Counsel for the first defendant raised two issues, one is a new issue not related to the relief sought but which touches on the entire suit – the question of whether the Court is competent to hear the relief sought. The second d issue dependent on the first is whether the order of interlocutory injunction should be granted. I have decided to reframe the issues raised by both Counsel. e In view of the relief sought on the motion paper and the question of competency of the suit, the following issues will be considered:– f Issue I – Whether the present suit and motion is incompetent. Issue II – Whether applicant has shown special circumstances to warrant order of interlocutory g injunction. Issue I – Whether the present motion and suit is incompetent It is the contention of learned Counsel for the first defendant h that from the reliefs sought against the first defendant/ respondent that applicants are invoking jurisdiction of this Court to make pronouncements on regulating powers of the first defendant/respondent enshrined in section 29(2) i of Banks and Other Financial Institutions Act (BOFIA), 1999 as amended and code of conduct for Directors of Banks in Nigeria. He submits that the Bank referred to in section 49(1) of BOFIA is the first defendant and there- j fore this Court is stripped of jurisdiction to hear and

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J 388 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a determine the claims of the plaintiffs/applicants against the first defendant/respondent and as sued. The Court is incompetent and forbidden to hear claims against Central Bank of Nigeria. He contends further that if the Court is b devoid of jurisdiction to hear a matter before it, then the basis of exercise of constitutional powers under section 6(1) and (6) of Constitution is also absent. He cited Ajomale v Yaduat and another No. 1 (2003) FWLR (Part 182) 1902 c at 1911. He finally submits that the Court lacks jurisdiction Court (sic) and cannot make an order for injunction. d Learned SAN I A Adedipe in reply on points of law contends that the incompetence of an action does not amount to want of jurisdiction. He submits further if plaintiffs’ action can be challenged on want of competence at all it can e only be challenged on a statement of defence filed and in compliance with the provisions of Order 25 rules 2, 3 and 4 of Federal High Court (Civil Procedure) Rules, 2000 because demurrer has been abolished. He submits that the incompetence of the action has not yet been raised as f required by law and does not affect jurisdiction but goes to merit of action.

He further submits that the Court has jurisdiction to g entertain both the action and the motion. He referred to section 251(d) of 1999 Constitution, section 7(d) and (e) of Federal High Court Act Cap F12 Laws of Federation of Nigeria, 2004 and cited several other cases. h The Supreme Court in the locus classicus case of Madukolu v Nkemdilim (1962) 2 SCNLR 342; (1962) All NLR 581 set out the criteria that determines whether a court is competent to hear a case. This includes:– i (a) Whether the court has been properly constituted as regards number and qualification. (b) The subject matter of the case is within the jurisdiction of the court and there is no feature in j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 389 a the case which prevents court from exercising its jurisdiction. b (c) The case comes by due process of law and upon fulfilment of any condition precedent to the exercise of jurisdiction. Relying on this criteria set down by the Supreme Court, I c poise (sic) the question whether the present Court is competent to entertain the reliefs before the Court. The plaintiff in paragraph 3.1 of the statement of claim filed on 16 July, 2004 claims against the defendants seven d reliefs. Relief 1 seeks a declaration that the plaintiff has not acted in any manner capable of violating section 29(2) of BOFIA, 1999 (as amended) or Code of Conduct as well as Central e Bank of Nigeria circular. This relief seeks a pronouncement on the act of the plaintiff as relates to the Provisions in section 29(2) of BOFIA. Therefore pronouncement sought involves conduct of f Directors in a Bank. Relief 5 seeks a consequential order against defendant depending on the Court’s decision on the main reliefs, therefore those two reliefs bother (sic) on the first plaintiff (sic) status as Director in Fortune International g Bank and the Central Bank of Nigeria. This subject matter is covered by section 251(d) of the 1999 Constitution. Reliefs 2, 3 and 4 are subject matters which fall within the ambit of section 251(1)(d) of the 1999 Constitution. I do h agree with learned SAN for the plaintiff that the determinant of jurisdiction is the plaintiff’s claim. See Usman v Baba (2005) 5 NWLR (Part 917) 113; Adeyemi v Opeyori (1976) 9 – 10 SC 31. i I do also concede to his submission that the plaintiff’s claim falls within the ambit of jurisdiction conferred on the Federal High Court under section 251(d) of 1999 Constitution and section 7(d) and (e) of the Federal High j Court Act Cap F12 Laws of Federation of Nigeria, 2004.

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J 390 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a However, the learned Counsel for the respondent raised a very important issue of law on whether the defendant enjoys statutory immunity from prosecution to powers conferred on her by the Banks and Other Financial Institutions Act. The b learned SAN’s response is that if the plaintiff’s action can be challenged on want of competence at all it can only be so challenged after statement of defence is filed in compliance with the provisions of Order 25 rules 2, 3 and 4 of Federal c High Court (Civil Procedure) Rules, 2000 and that the incompetence has not been raised as required by law. The question arising from his contention is whether there is any distinction between lack of competence and issue of d jurisdiction. I do concede that an action may be incompetent because a condition precedent to the institution of an action has not been complied with. In other words the Court will have e jurisdiction to adjudicate over the matter only after due process has been followed such as service of writ etc. In Dongtoe v CSC Plateau State (2001) 9 NWLR (Part f 717) SC 132, the Supreme Court held the question of the validity or not of the jurisdiction of the court touches on the competence of the court to hear and determine a cause or matter before it and is fundamental to its exercise of jurisdiction and of adjudication and determination of the g cause before it. Furthermore the Supreme Court in Eze v A- Rivers State (2001) 18 NWLR (Part 746) 524 on when to raise and argue issue of jurisdiction held:– “The application to raise and argue the issue of jurisdiction of a h trial Court and of the competence of the other party can be accepted at any stage of the proceedings and even on appeal”. Clearly the learned Counsel for the defendant is contesting that the suit against the first defendant is incompetent in i view of the provision in section 49(1) of the 1999 No. 25 BOFIA, 1991 as amended. Section 49(1) provides that neither the Federal Govern- ment nor the first defendant shall be subject to any action, j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 391 a claim or demand by or liability to any person for any act or omission in connection with power conferred on the Government or Bank by the Act. The interpretation section b described the word “Bank” as the Central Bank of Nigeria that is the first respondent. Provision in section 49(1) gives the first defendant an immunity from prosecution or to be found liable or execution of power or intended execution of c any power conferred upon the first defendant. The issue of statutory immunity touches on the competence of the court to entertain an action basis of first defendant claims that suit is incompetent because he enjoys immunity. In the instant d case the Court has jurisdiction to entertain the subject matter as conferred under section 251(1)(d) of the 1999 Constitution but the jurisdiction challenged is whether action can be sustained against the first defendant in view of the e statutory immunity stipulated in section 49(1). It is an issue that touches on the jurisdiction of the Court and can be raised at any stage without the defendant filing his statement of defence. I acknowledge that provision in Order 25 rule 1 that demurrer is abolished but the present issue is not on f admission of facts but on whether the action can be sustained against the first defendant under section 49(1). What then is the status of section 49(1) of BOFIA, 1991 in the light of the 1999 Constitution? The 1999 Constitution g has under section 251(1)(d) provided specifically that the Federal High Court shall exercise exclusive jurisdiction in any action by or against Central Bank of Nigeria arising from banking matters. By this constitutional provision 1999 h the Central Bank of Nigeria cannot enjoy any immunity from action involving bank matters. A right conferred or vested by the Constitution cannot be taken away by any other statutory provision except by the Constitution itself. i See A-G, Osun State v International Breweries Plc (2001) 7 NWLR (Part 713) CA 647. The 1999 Constitution is supreme. One must not forget the fact that BOFID 1991 No. 25 was enacted as a Decree j during Military Regime. The present status has changed as

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J 392 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a regards access to court against the defendant; section 251(1) (d) is clear on the current position that actions can be instituted against the first defendant in banking matters. Banking and financial acts include powers conferred on b defendant under BOFID. It is paramount to note that the Banks and Other Financial Institutions Act Cap B3 Revised Laws of the Federation of Nigeria, 2004 which Act is to regulate banking and financial institutions omitted the c provision under section 49(1) on Immunity of the Central Bank of Nigeria. I therefore hold that the present suit against first defendant is competent. Issue II – Whether the Court should grant the application d for injunction First issue to look at is the contention of the learned SAN that none of the counter-affidavit was deposed to by any official of the two banks, rather in the case of first defendant e that the affidavit was deposed to by one Joe TA Gambo described as a law office manager without deponent disclosing the particular official in Central Bank of Nigeria who gave him information. He referred also to the counter- f affidavit of second defendant whose Counsel never appeared in Court to respond to the issues raised. It is the contention of learned SAN that the counter-affidavit offends sections 86, 88 and 89 of Evidence Act. g I have looked at section 86 of the Evidence Act which requires a deponent to state facts of his own personal knowledge or from information which he believes to be true. Whilst section 89 requires that informant be named. h In paragraph three of the counter-affidavit of first defendant filed on 21 October, 2004 deponent stated that he was informed by first defendant. First defendant is the Central Bank of Nigeria and by status of a legal entity is a i person, in the legal parlance as submitted by learned Counsel for first defendant. I therefore concede to the submission of Mr Akpodiete that the deponent in the counter-affidavit did not contravene j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 393 a sections 86, 88 and 89. There is substantial compliance. In respect of the submission of learned SAN that the affidavit contains extraneous matters the onus is on him to identify b those paragraphs of the counter-affidavit that contain extraneous matters before the Court will rule on whether he is correct or not. The Court cannot scrutinise the paragraphs to support his contention. c Now on whether the Court should exercise its discretion and grant the order for injunction; the Appellate Courts in a catalogue of decided cases have set out principles guiding the grant of interlocutory injunction. These are principles d because an application for interlocutory injunction raises the issue of exercise of discretion by the trial court which must be exercised judicially and judiciously in accordance with the prevailing facts and circumstance. e These principles were summarised by the Court of Appeal into three in the case of Ogunsola v Usman (2003) FWLR (Part 180) CA 1465 as follows:– 1. Whether there is a serious question to be tried at the f substantive suit; 2. Balance of convenience and 3. Inadequacy of damages. g It is the contention of the learned SAN that the applicant have (sic) shown there is a serious issue to be tried referred to paragraph 31(a) – (g) where they set out their claims and which basically are founded on the allegations contained in h the statement of claim of the plaintiff. It is the submission of the learned Counsel for the first defendant that plaintiff must show he has a legal right; he submitted that the right to be a Director in Nigeria is subject i to the first defendant. Learned counsel argued sternly on the right of the first plaintiff to be a Director which is dependable (sic) on whether he is in good book (sic) of first defendant and first j defendant being a regulatory body the Court cannot restrain

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J 394 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a him from exercising its powers of removing the first plaintiff/applicant as a Director of Fortune International Bank Plc. I most respectfully disagree with Mr Akpodiete on his submission that the applicant at this stage must establish b legal right. What applicant needs to show at this stage for an interlocutory injunction is that there are serious issues to be tried at the substantive claim and that the claim is not frivolous. The rationale is that question of legal right is tied c to substantive matter is always an issue in contention (sic). The strong contention of Mr Akpodiete in his written submission and the averments in the counter-affidavit support rather than derogate from the fact that there are d serious issues raised in the relief of the plaintiff for determination. I have no doubt from the affidavit evidence before me and the counter-affidavit in relation to the claim of plaintiff that e there are serious questions that offer itself for trial. The applicant seeking pronouncement on serious issues on statutory provision and the questions raised are not frivolous. f The principle argued by Mr Akpodiete that applicant must show legal right is not one of the current guidelines to be considered as it used to be. In fact the attitude of the Appellate Court is that all applicant need show is that he has g serious issues before the court for determination. The first plaintiff’s claim is on his alleged right not to be removed. This right is what he is to establish at trial and not h at this stage of affidavit evidence for injunction. Having found there is a serious question to be tried, the next question is whether damages will be adequate compensation for the temporary inconvenience applicant will suffer and if damages will be inadequate in whose favour is the balance i of convenience (sic)? The learned SAN for applicant contended that the first defendant will not suffer any inconvenience if an injunction is granted and that they can be compensated in damages. In Total Nig Plc v VIIRA j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J Macpepple v Central Bank of Nigeria Continental Trust Bank Ltd 395 a (2004) 7 NWLR (Part 873) CA 446, the Court of Appeal held that:– “The determination of where the balance of convenience lies in an b application for Interlocutory Injunction is an exercise which calls as between the parties for an evaluation of the question of availability in the alternative of adequate remedy in damages with regard to the Applicant’s claim and his ability to meet a gross c undertaking as to damages.” In the instant case plaintiff averred in paragraph 35 of the affidavit in support that as a Director in Fortune Inter- national Bank Plc his removal will adversely affect the d goodwill of the Fortune International Bank. Whilst first defendant in paragraph 3(o) contends that to grant plaintiffs’ application would cause incalculable harm to the general public. Clearly the first defendant has not told the Court his e right as regards the statutory function will be incon- venienced if a temporary order of maintenance of status quo is granted rather first defendant is talking about the effect on the general public. To balance the scale of convenience must be on the basis of both first plaintiff and first f defendant competing rights and the nature of reliefs one and three sought on the motion paper are such that balance of convenience is in favour of a grant of part of the application for injunction as damages will be inadequate g compensation. This is because if status quo is not maintained at this stage, the effect may not be quantifiable in damages. Furthermore the issues raised for determination in the h substantive claim ought to be preserved until the determination of the substantive suit. The first plaintiff has undertaken in paragraph 36 to pay damages for any loss suffered by the defendants for the grant of this order. The i first defendant did not in the counter-affidavit contradict the ability of plaintiff to pay damages if need be. I therefore in the light of the foregoing hold that the plaintiffs have satisfied the conditions for grant of an interlocutory j injunction in respect of part of reliefs one and three.

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, PORT HARCOURT DIVISION) Nwodo J 396 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a It is in the interest of justice that I exercise my discretion in favour of grant of injunction in respect of prayers one and three pending the determination of the claim before the Court. b However prayer two on the motion paper is too vast as couched that grant of same will amount to an unended restraint. The application succeeds in part and I order as follows:– c 1. An order of interlocutory injunction restraining the defendant/respondent from taking any administrative step for removing the first plaintiff/applicant from the d Board of Fortune International Bank Plc as Director pending the hearing and determination of the substantive suit. 2. An order of interlocutory injunction restraining the e defendants/respondents from taking further steps of whatever kind on the relationship between the second plaintiff/respondent pending the final determination of the substantive suit. f 3. Plaintiffs must file an undertaking to indemnify the defendants/respondents in damages if this application should not have been made. 4. Prayer II on Motion Paper is dismissed. g

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Union Bank of Nigeria Plc v Chimaeze 397 a Union Bank of Nigeria Plc v Chimaeze b COURT OF APPEAL, BENIN DIVISION BULKACHUWA, NGWUTA, ABBA-AJI JJCA Date of Judgment: 22 FEBRUARY, 2006 Suit No.: CA/B/182/99

Banking – Wrongful dishonour of customers cheque – c Measure of damages – Principles applicable

Facts This appeal is against the judgment of Edo State High Court d sitting in Benin presided over by Honourable Justice VAO Omage J (as he then was) delivered on 31 May, 1996. The respondent as the plaintiff sued the appellant as the defendant claiming the following reliefs:– e “The Plaintiff claims against the Defendants jointly and severally the sum of Thirty Million Naira (N30,000,000.00k) being special and general damages for breach of contract in that on or about the 10 May, 1994, the Defendants at its Benin City branch, f dishonoured the Plaintiff’s Cheque No. 85053 of 5/5/94 for N205,936.50k in favour of Lever Brothers Nigeria Plc without cause”. In the amended Statement of Claim filed by leave of court g on 11 October, 1994, the plaintiff claimed as “particulars of special damages” as follows:– Money deducted from plaintiff’s account – N 206,000.00k Loss of profit for 1994/95 – N10,000,000.00k h Solicitors fees – N 250,000.00k General Damages – N 19,544.00k Total – N30,000,000.00k i The plaintiff/respondent is a businessman and a trader based in Benin City and an appointed distributor of all Lever Brothers Nigeria Plc products in Edo, Delta, and Kwara States. He also holds a current account No. 1971261605 j with the appellant bank at its Mission Road, Branch Office,

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Benin City. The respondent on 9/5/94 lodged a total sum of a N206,000.00k into his said account through Miss D Nwakaeze, a sales girl and cashier with the respondent. The respondent on 5/15/94 issued cheque no. 85053 for b N205,966.50 (two hundred and five thousand, nine hundred and sixty-six Naira, fifty Kobo) to Lever Brothers Nigeria Plc (LBN) to cover credit purchase of its products. When the said cheque was presented to the appellant for payment on c 10/05/94, it was returned unpaid, with the endorsement “Drawer’s Attention Required”. The respondent’s case was that at the time this cheque to Lever Brothers Nigeria Plc was returned unpaid by the appellant, he had a credit balance of N207,978.00k (two hundred and seven thousand, nine d hundred and seventy-eight Naira) in his account and that a sum of N206,000 (two hundred and six thousand Naira) was wrongly debited from his account. It was also the respondent’s case that the appellant’s dishonour of his e cheque caused him special and general damages. The appellant’s case was that the so-called cash lodgement of N206,000.00k claimed by the respondent was f fictitious in that Miss D Nwakaeze did not lodge any physical cash in the plaintiff’s account. That any document evidencing such lodgement was fraudulent and fictitious book entries. It was the appellants’ case that there was a conspiracy between the respondent’s staff and one of its own g staff to perpetuate the fraud. That when the appellant discovered the fraud, it had no other option than to reverse the fictitious entries. h At the close of evidence, the learned trial Judge in a considered judgment gave judgment to the respondent. The defendant as the appellant being dissatisfied with the said judgment has appealed to this Court. i

Held – 1. A trader is entitled to recover substantial damages for the wrongful dishonour of his cheque without pleading j

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Union Bank of Nigeria Plc v Chimaeze 399 a and proving actual damage. In effect, the plaintiff is entitled to substantial damages from the court without pleading and proving actual damage once it is proved b that the plaintiff’s cheque was wrongfully dishonoured by the defendant Bank and indeed as found by the learned trial Judge in this case. The question of proof of actual loss does not therefore arise in the circumstance c of this case. 2. Damages in such cases are at large which means that in such cases, a court may within reasonable limits make an award of any such sum as the court considers the d circumstance of the breach of contract to honour a cheque warrants although there has been no proof of any actual loss to the customer. 3. Where a banker without justification dishonours a e customer’s cheque, he is liable to a customer in damages for injury to his credit and if the customer is also a trader then damages for such injury to the customers credit will also be at large and the court may award substantial f damages although there is no evidence from such a customer of any actual damage suffered by him. Main appeal dismissed, cross-appeal allowed. g Cases referred to in the judgment Nigerian Aeroflot Soviet Airline v UBA Ltd (1986) 3 NWLR (Part 27) 188 h Akintola v Anyiam (1961) All NLR 508 Allied Bank of Nigeria Plc v Akubueze (1997) 6 KLR 1202 Anaeze v Anyaso (1993) 5 NWLR (Part 291) 1 i Ashubiojo v ACB (1966) 2 All NLR 203 Awoyoolu v Aro (2001) 21 WRN 41 Balogun v Akanji (1988) 1 NWLR (Part 70) 301 j Balogun v National Bank of Nigeria Plc (1978) 3 SC 155

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Balogun v UBA (1992) 6 NWLR (Part 247) 336 a Barje v Gunduma (2001) 13 NWLR (Part 731) 659 Bello v Kassim (1969) NMLR 148 b Buba v The State (1994) 7 NWLR (Part 355) 195 Daniyan v Iyagin (2002) 7 NWLR (Part 760) 345 Daniyan v Iyagin (2002) 8 WRN 44 c Densy Ind (Nig) Ltd v Uzokwe (1999) 2 NWLR (Part 591) 392 Eboh and others v Akpotu (1968) NMLR 278 Egbunike v ACB (1995) 27 LRCN 219 d Eke v Okwaranya (2001) 20 WRN 132 Eke v Okwaranyia (2001) 12 NWLR (Part 726) 181 ELF (Nig) Ltd v Sillo (1994) 6 NWLR (Part 350) 258 e Enang v Adu (1981) 11 – 12 SC 25 Ezekwesili v Agbapuonwu (2003) 9 NWLR (Part 827) 337 Guinness Nigeria Plc v Nwoke appeal no. CA/B/252/98 f Ibido v Enarofia (1980) 5 – 7 SC 42 Ifeanyichukwu Osondu Co Ltd v Akhigbe (1999) 1 NWLR (Part 675) 1 Ijebu-Ode Local Govt v Balogun (1991) 1 NWLR (Part 166) g 136 Ike v Ugbaja (1993) 6 NWLR (Part 301) 539 Imana v Robinson (1979) 3 – 4 SC 1 h Iwego v Ezeugo (1992) 6 NWLR (Part 249) 561 Joe Goldy Co Ltd v CDB Plc (2003) 5 NWLR (Part 814) 586 i Kezie v Iwuoha (1998) 8 NWLR (Part 563) 554 Lawal v Adekoya (1974) 6 SC 83 Lewis & Peat v Akhimien (1976) 7 SC 157; (1976) 1 All NLR (Part 1) 460 j

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Union Bank of Nigeria Plc v Chimaeze 401 a NBC Plc v Borgundo (1992) 2 NWLR (Part 591) 408 Nigeria Bank for Commerce and Industry Ltd (1998) 8 NWLR (Part 613) 119 b Nigeria Bank for Commerce and Industry v Integrated Gas (Nig) Ltd (1998) 8 NWLR (Part 613) 119 Ogbodu v Quality Finance Ltd (2003) 6 NWLR (Part 815) c 147 Okoroji v Enumah (1961) All NLR 191 Olale v Ekwelendo (1989) 4 NWLR (Part 115) 326 d Oniya v Okoliko (1992) 7 NWLR (Part 254) 500 Onuigbo v Nwekeson (1993) 3 NWLR (Part 238) 544 Onwujoba v Obienu (1991) 1 NSCC 494 e Sabru Motors (Nig) Ltd v Rajab Enterprises (Nig) Ltd (2002) FWLR (Part 116) 841 Saliba v Yassin (2002) 13 WRN 59 f Strabag Contruction (Nig) Ltd v Ogarekpe (1991) 1 NWLR (Part 170) 733 Techno v Njoku (2001) 52 WRN 177 g Tewogbade v Akande (1968) NMLR 404 UBN Ltd v Ademuyiwa (1999) 11 NWLR (Part 628) 570 UBN Plc v Jeric (Nig) Ltd (1998) 2 NWLR (Part 536) 63 h UBN Ltd v Nwoye (1996) 35 LRCN 232 Uwa Printer Ltd v Investment Trust Co Ltd (1988) 12 SCNJ (Part 1) 102 Woluchem v Gudi (1981) 5 SC 291 i Foreign Gibbons v West Minster Bank Ltd [1939] 3 All ER 577 j Ziks Press Ltd v Alvan Ikoku 14 WACA 188

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Statute referred to in the judgment a Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, section 14 9(d) b Counsel For the appellant/cross-respondent: Orbih (with him Erameh (Mrs) and Inegbeboh) c For the respondent/cross-appellant: Adodo

Judgment ABBA-AJI JCA: (Delivering the lead judgment) This d appeal is against the judgment of Edo State High Court sitting in Benin presided over by Honourable Justice VAO Omage J (as he then was) delivered on 31 May, 1996. The respondent as the plaintiff sued the appellant as the e defendant claiming the following reliefs:– “The Plaintiff claims against the Defendants jointly and severally the sum of Thirty Million Naira (N30,000,000.00k) being special and general damages for breach of contract in that on or about the f 10 May, 1994, the Defendants at its Benin City branch, dishonoured the Plaintiff’s Cheque No. 85053 of 5/5/94 for N205,936.50k in favour of Lever Brothers Nigeria Plc without cause.” g In the amended statement of claim filed by leave of court on 11 October, 1994, the plaintiff claimed as “particulars of special damages” as follows:– Money deducted from Plaintiff’s – account N206,000,00k h Loss of profit for 1994/95 – N10,000,000.00k Solicitors fees – N250,000.00k General Damages – N19,544.00k i Total – N30,000,000.00k Pleadings were duly filed and exchanged. The respondent testified and called two other witnesses and the appellant called four witnesses. The facts of the case as can be j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 403 a deduced from the pleadings and the evidence of the witnesses are clear and unambiguous. The plaintiff/respondent is a businessman and a trader b based in Benin City and an appointed distributor of all Lever Brothers Nigeria Plc products in Edo, Delta, and Kwara States. He also holds a current account No. 1971261605 with the appellant bank at its Mission Road, c Branch Office, Benin City. The respondent on 9/5/94 lodged a total sum of N206,000.00k into his said account through Miss D Nwakaeze, a sales girl and cashier with the respondent. The respondent on 15/5/94 issued cheque no. d 85053 for N205,966.50 (two hundred and five thousand, nine hundred and sixty-six Naira, fifty Kobo) to Lever Brothers Nigeria Plc (LBN) to cover credit purchase of its products. When the said cheque was presented to the e appellant for payment on 16/05/94, it was returned unpaid, with the endorsement “Drawer’s Attention Required”. The respondent’s case was that at the time this cheque to Lever Brothers Nigeria Plc was returned unpaid by the appellant, f he had a credit balance of N207,978.00k (two hundred and seven thousand, nine hundred and seventy-eight Naira) in his account and that a sum of N206,000 (two hundred and six thousand Naira) was wrongly debited from his account. g It was also the respondent’s case that the appellant’s dishonour of his cheque caused him special and general damages. The appellant’s case was that the so-called cash h lodgement of N206,000.00k claimed by the respondent was fictitious in that Miss D Nwakaeze did not lodge any physical cash in the plaintiff’s account. That any document evidencing such lodgement was fraudulent and fictitious i book entries. It was the appellants’ case that there was a conspiracy between the respondent’s staff and one of its own staff to perpetuate the fraud. That when the appellant discovered the fraud, it had no other option than to reverse j the fictitious entries.

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At the close of evidence, the learned trial Judge in a a considered judgment gave judgment to the respondent as follows:– “It is the judgment of this court that the Defendant should from the b date of this judgment credit the account of the plaintiff No. 85053 with the sum of N206,000.00 (Two Hundred and Six Thousand Naira only). The Defendant shall pay to the Plaintiff, the sum of (One Hundred Thousand Naira) N100,000.00 as general damages, and a separate sum of N250,000.00k (Two Hundred and Fifty c Thousand Naira) as solicitors fees. The total being (N350,000.00k) Three Hundred and Fifty Thousand Naira only which I hereby award to the Plaintiff.” The defendant as the appellant being dissatisfied with the d said judgment has appealed to this Court upon two original grounds of appeal vide a notice and grounds of appeal dated the 4 June, 1996. With leave of this Court granted on 11 June, 2001, the appellant filed three additional grounds of e appeal. The grounds of appeal without their particulars are hereby reproduced:– “1. The learned trial Judge erred in law in awarding the sum of N250,000.00 as special damages. f 2. The judgment is against the weight of the evidence adduced at the trial of the suit. 3. The learned trial Judge erred in law when he held as follows– ‘On the issue of variation of procedure for payment of sums g above N30,000.00, I believe the testimony of P.W.2 that she was directed to make payment of the sum of N206,000.00 to the cashier, who received the money while in the service of the Defendant’. h 4. The learned trial Judge erred when he held as follows–– ‘If the Defendant did not so believe, they would have called Mr. Nwani to deny receipt of the money which I have found that P.W.2 paid to the Defendant through i Nwani. The law of evidence Section 149(d) allows the presumption to be made that the said Mr. Nwani was not called by the Defendant because if the Defendant had called him, his evidence would have been adverse to the Defendant’. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 405 a The learned trial Judge misdirected himself on the evidence when he held that–– ‘I accept as true the testimony of P.W.2 that she paid the b sum shown on MOC3 to the cashier of the Defendant by name A.K. Nwani’.” The respondent, also dissatisfied with the award of general damages, has appealed to this court on a lone ground of c appeal vide a notice and grounds of appeal dated the 6 August, 1996. The ground reads–– “1. The learned trial Judge erred in law when he awarded the Plaintiff the paltry sum of N100,000.00 (One Hundred Thousand Naira) as general damages.” d Briefs of argument were duly filed and exchanged. In the appellants brief settled by the Ferdinand O Orbih Esq. three issues were formulated, viz:– e “(1) Whether or not the learned trial Judge was right in awarding the sum of N250,000.00 (Solicitor’s cost) as special damages to the respondent in the circumstances of this suit. (2) Whether or not the finding of the learned trial Judge on the issue of payment of N206,000.00 was supportable by the f pleadings and evidence adduced by the parties during the trial of this action. (3) Whether or not the learned trial Judge was right in his application of Section 149 (d) of the Evidence Act in the g circumstance of this case.” In the respondent’s brief settled by GC Igbokwe Esq., learned Counsel adopted the issues as formulated by the appellant for the determination of the appeal. These issues h will therefore determine this appeal. Arguing issue one, Orbih Esq., learned Counsel for the appellant submitted that the respondent pleaded in paragraphs 21 and 22 of his amended statement of claim that i his solicitors charged him the sum of N250,000.00k (two hundred and fifty thousand Naira) to prosecute the appeal and that he made a deposit of N150,000.00k (one hundred and fifty thousand Naira). He submitted that these j paragraphs were denied in paragraph 2 of the statement of

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 406 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) defence and argued that the said solicitors’ fee was not a loss a arising from the return of the respondent’s cheque. Orbih Esq. argued that the respondent tendered a receipt of N150,000 and there was no evidence that the respondent b paid N250,000 as claimed by him under cross-examination. He contended that the award of N250,000 by the learned trial Judge was erroneous in that the parties are bound by their pleadings. Learned Counsel argued that the learned c trial Judge did not avert his mind to the obvious contradictions in the evidence of the respondent on this issue before awarding him the sum of N250,000.00k as solicitors’ fees. He contended that the award was wrong in law. d Learned Counsel further submitted that the solicitor’s fee even if proved did not arise as a result of damage suffered by the respondent in the course of any transaction with the appellant as the circumstances that gave rise to the special e damage occurred after the cause of action in this case had arisen. That the solicitor’s fee did not form part of the basis of the breach of contract, the return of the cheque on which the respondent rooted his cause of action. Learned Counsel f also argued that it is against public policy to allow the respondent to pass on the burden of paying his solicitors’ fee to the other party in this case, the appellant. Learned Counsel cited and relied on the unreported case of Guinness Nigeria Plc v Emmanuel Nwoke in appeal no. CA/B/252/98 g where SA Ibiyeye JCA had cause to comment on the award of N500,000.00k special damages being solicitor’s fee. In his response to this issue, learned Counsel for the h respondent, Igbokwe Esq. submitted that the sum of N250,000.00k as special damages was copiously pleaded in paragraphs 21 and 22 of the amended statement of claim while the statement of defence only contains a general traverse of same in paragraph 2. He argued that mere general i denials in pleadings are never sufficient traverse and amounts to no denials at all with the end result that the particular pleaded fact remains unchanged and only requires minimal evidence or none at all to be admitted as proved by j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 407 a the trial court. He cited the following cases – Daniyan v Iyagin (2002) 8 WRN 44; Eke v Okwaranya (2001) 20 WRN 132 and Kezie v Iwuoha (1998) 8 NWLR (Part 563) b 554. Learned Counsel further submitted that the respondent tendered Exhibit ”MOC 7” a receipt for the payment of N150,000.00k deposit with a balance of N100,000.00k. He c argued that the respondent’s answer under cross- examination that he paid his lawyer N250,000 neither amounts to a contradiction nor a contradiction to impugn the finding of the trial Judge citing and relying on Barje v d Gunduma (2001) 13 NWLR (Part 731) 659. On the issue of proof, learned Counsel referred to the following – section 138 of the Evidence Act; Densy Ind (Nig.) Ltd v Uzokwe (1999) 2 NWLR (Part 591) 392 and e Balogun v UBA (1992) 6 NWLR (Part 247) 336. Learned Counsel also submitted that special damages are those that arise after and as a result of the cause of action not before it and that it was wrong for the appellant to argue that f solicitors’ fees as a head of special damages does not form part of the basis of the breach of contract. He relied on the following cases; Strabag Contruction (Nig) Ltd v Ogarekpe (1991) 1 NWLR (Part 170) 733; NBC Plc v Borgundo g (1992) 2 NWLR (Part 591) 408; Onuigbo v Nwekeson (1993) 3 NWLR (Part 238) 544; Uwa Printer Ltd v Investment Trust Co Ltd (1988) 12 SCNJ (Part 1) 102; Techno v Njoku (2001) 52 WRN 177 and Imana v Robinson (1979) 3 – 4 SC 1. h It was also argued by the respondent Counsel that “wrongful dishonour of cheque” cases are sui generis and that damages therein are “at large” citing, Hirat Balogun v NBN (1978) 3 SC 55 and UBN v Nwoye (1996) 3 LRCN i 232. He submitted that a successful plaintiff in wrongful dishonour of cheque cases becomes entitled to recover on several heads of damages even without pleading and proving the said damages citing, Allied Bank Plc v Akubueze (1997) j 6 KIR 1202 and Ashubiojo v ACB (1966) 2 All NLR 203.

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Mr Igbokwe Esq. argued that the unreported case of a Guinness Nigeria Plc v Emmanuel Nwoke (supra) cited by the appellant’s Counsel is not applicable to the present circumstances of this case as it was not based on wrongful b dishonour of cheque where damages are at large. Learned Counsel urged the court to uphold the award of N250,000.00k by the trial Judge as the appellant has not shown any special and or sufficient reason for the said c award to be upset, citing the following cases, Okoroji v Enumah (1961) All NLR 191; Zik Press Ltd v Alvan Ikoku 14 WACA 188; ELF (Nig) Ltd v Sillo (1994) 6 NWLR (Part 350) 258 and Ijebu-Ode Local Govt v Balogun (1991) 1 NWLR (Part 106) 136. d The contention here is whether the learned trial Judge was right in awarding the sum of N250,000.00k solicitor’s cost, as special damages to the respondent in the circumstances of e this case. The respondent pleaded in paragraphs 21 and 22 of his amended statement of claim that his solicitor charged him the sum of N250,000.00k to prosecute this action and that he made a deposit of N150,000.00k. Paragraphs 21 and 22 of the respondent’s amended statement of claim provides f as follows:– “21. Plaintiff avers that he ran and briefed his Solicitors Messrs G.C. Igbokwe & Co. who charged him N250,000. (Two Hundred and Fifty Thousand Naira) only to prosecute this g action. 22. Plaintiff avers that he made a deposit of N150,000 to the said Solicitors who issued him receipt. The Solicitors receipt No. 045 of 24/5/94 shall be founded upon at the trial of this h action.” In reply to the above paragraphs, the appellant made a general traverse to the claim in paragraph 2 of his statement of defence. i Paragraph 2 of the appellant’s statement of defence is hereby reproduced:– “2. The Defendant denies all the allegations in paragraphs 1, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 409 a 23 and 24 as well as the reliefs contained in paragraphs 25 and 26 of the Statement of Claim and shall at the trial put the plaintiff to the strictest proof of the allegations Contained in the said paragraphs.” b A denial in a statement of defence that, “the Defendant denies a paragraph in the Statement of Defence and put the plaintiff to the strictest proof thereof” amounts to insufficient denial or insufficient traverse to put the matter c thus denied in issue. See Daniyan v Iyagin (2002) 7 NWLR (Part 760) 345. If the appellant had intended to make the sum of N250,000 solicitor’s fee an issue, it should have been specifically traversed and/or denied as is with essential and d material allegations in a statement of claim. There should be no general traverse in respect of essential and material allegations. They should be specifically traversed. It is trite law that mere general denials in pleadings are e never sufficient traverse and amounts to no denials at all with end result that the particular pleaded fact remains unchallenged and only required minimal evidence or none at all to be admitted as proved by the trial court. See Ogbodu v f Quality Finance Ltd (2003) 6 NWLR (Part 815) 147 and Eke v Okwaranyia (2001) 12 NWLR (Part 726) 181. The respondent pleaded that his solicitors charged him N250,000.00k to prosecute this case for him. He also went g further to claim the said sum as special damages in paragraph 25 of his amended statement of claim among his other heads of claim before the trial court. It is therefore my considered view that even if paragraphs 21 and 22 of the h appellant’s statement of defence were denied by the appellant, the respondent has established same by preponderance of evidence before the trial court and I therefore so find. i The learned Counsel further argued that there is contradiction in the evidence of the respondent. The contradiction as argued by the appellant’s Counsel was that the respondent’s evidence in chief was that he was charged j N250,000.00k by his solicitor but he paid him N150,000.00k

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 410 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) and he tendered a receipt of N150,000. That under-cross a examination the respondent told the court that he paid his lawyer N250,000.00k and that there was no receipt to prove that this was the case. Learned Counsel argued that the b evidence of the respondent under cross-examination is at variance with his pleadings. The question is, is the contradiction in the evidence of the respondent, as stated by the appellant, sufficient enough as to upset the finding of the c learned trial Judge? The fact that the respondent was charged N250,000.00k was clearly established by the respondent. He also established the fact that he paid N150,000 to his lawyer who issued him with a receipt Exhibit “MOC 7” which bears on its face the payment of d N150,000 being a deposit in the suit and a balance of N100,000.00k. It is not every contradiction in the evidence of a witness that will result in upsetting a trial court’s judgment. For a contradiction to upset a judgment it must be e of such a magnitude as to warrant interference with the conclusion reached by the trial court. In the instant case, the appellant made heavy weather on the evidence of the respondent when he said under cross-examination that he f paid his lawyer N250,000 when in fact it was only N150,000 that was paid. In the circumstances, I agree with the submission of the learned Counsel for the respondent that the respondent’s answer under cross-examination that he g paid his lawyer N250,000 neither amounts to a contradiction nor a sufficient contradiction to impugn the finding of the learned trial Judge, and I so find. Learned Counsel for the appellants also argued that the h solicitor’s fee of N250,000 even if proved did not arise as a result of damage suffered by the respondent in the cause of any transaction with the appellant. Had the breach by the appellant not being occasioned, the respondent would have no cause to engage the services of a legal practitioner and i would not have been charged legal fees of N250,000.00k. Special damages are those that arose after and as a result of the cause of action and not before it and the argument of the appellant that the solicitor’s fee as a head of special damages j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 411 a does not form part of the basis of the breach of the contract is also of no moment. The unreported case of Guinness Nigeria Plc v Emmanuel Nwoke (supra) cited by the b appellant’s Counsel is not decided on the same principle of law as the present appeal and cannot therefore be applied. The concept of public policy cannot be relied upon to prevent a successful litigant in wrongful dishonour of cheque when the customer holds in his account an amount c equivalent to that endorsed on the cheque from the benefit of such awards. See Balogun v National Bank of Nigeria Ltd (1978) 3 SC 155; Ashubiojo v African Continental Bank (1966) 2 All NLR 203; Union Bank of Nigeria Ltd v Nwoye d (1996) 35 LRCN 232. The award by the learned trial Judge cannot be faulted and the finding cannot be disturbed. This issue is resolved against the appellant. e The second issue is whether or not the findings of the learned trial Judge on the issue of the payment of N206,000.00k was supported by the pleadings and the evidence adduced by the parties during the trial of the action. f It was submitted by the learned Counsel for the appellant that the respondent in his statement of claim stated that either himself or his staff had always lodged money into his g account at regular hours and to regular (sic) receiving cashier. That in reply to that statement of fact, the appellant averred that the respondent was duly informed at the inception of his relationship with the bank that all sums of h money above N30,000.00k are to be taken to the note counting room for payment into his account and that the respondent had kept to this regulation. That such sums are not meant to be taken to the cashier. He submitted that the respondent did not deny the above mode of payment pleaded i by the appellant and that the respondent did not make it part of his pleading that after going to the note counting room, PW2 was directed to pay the sum in question to the regular cashier at the counter. Learned Counsel contended that the j evidence believed by the learned trial Judge to the effect that

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PW2 was directed to make payment of the sum of a N206,000.00k to the cashier is not in support of any material averment in the pleading of the parties. That since the issue of mode of payment of sums above N30,000.00k was put in b issue by the appellant and has not been traversed by the respondent it should have been taken as established by the learned trial Judge citing Lewis & Peat v Akhimien (1976) 7 SC 157; (1976) 1 All NLR (Part 1) 460 and UBN Plc v Jeric c (Nig) Ltd (1998) 2 NWLR (Part 536) 63. Learned Counsel further argued that there were obvious material contradictions as to who filled Exhibit “MOC 3” and where it was filled and that these contradictions are material because the appellant put them in issue. Exhibit “MOC 3” is d the original bank teller evidencing the payment of the sum of N206,000.00k into the Bank. Learned Counsel considered the evidence of PW2 and submitted that there is a contradiction in the evidence of PW2 and PW3 as to who e paid in the money and the circumstances surrounding the alleged payment. That had the trial Judge considered these contradictions, he would not have come to the conclusion as he did that PW2 paid the sum shown on exhibit “MOC 3” to f the cashier of the respondent by name I K Nwani. Learned Counsel for the respondent, Igbokwe Esq. submitted that the real issue at stake is whether or not the sum of N206,000.00k was actually paid and received by the g appellant’s cashier, IK Nwani in the course of his employment for and on behalf of the appellant Bank and not whether the mode of payment was irregular or who in fact paid the money. He submitted that the pleadings and h evidence before the court show that the said money was paid to and received by the appellant through his cashier, Mr I K Nwani and as duly accepted by the learned trial Judge. Learned Counsel submitted that the findings of the learned trial Judge before coming to the conclusion he reached were i to the effect:– “(a) That I. K. Nwani was a staff of the Bank. (b) That PW2 made payment as on Exh. MOC 3 to the cashier of the defendant on 9/5/94. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 413 a (c) That Exh MOC 3, of which Exh MOC 4 is not denied to be a counterpart was found in the custody on the defendant’s admission when DW3 said MOC 3 was found in the cubicle of Mr. Nwani. b (d) That the onus shifts on the defendant to rebut the heavy averment of payment of the money on Exh. MOC 3 to Mr. Nwani; this has not been done. (e) That the bank believed the said Exh. MOC 3 as sufficiently c genuine as to feed the contents of it in their computer which produced Exh. MOC 5A and shows a credit in favour of the plaintiff. (f) That “Exhibit MOC 3 was tendered from the custody of the d defendant (bank) upon a notice of it to be produced. (g) That a document is the best proof of its contents, the contents of Exh. MOC 3 cannot be better proved than by the Exhibit itself which says ‘Credit N.M. Okpara Chimaeze total cash N206,000.00’. This contains the stamp of the Defendant e company with the date 9/5/94 and the Signature of the person which DW1 identified as that of the receiving cashier Mr. Nwani . . .”. are based on the evaluation of the evidence at the trial and f paragraphs 9 and 10 of the amended statement of claim that led conclusively to the fact that N206,000.00k was lodged into the respondent’s account, citing Aeroflot Soviet Airline v UBA Ltd (1986) 3 NWLR (Part 27) 188. g Learned Counsel also submitted that the above findings of fact are neither perverse nor manifest substantial error apparent on the face of the record sufficient for this Court to upset the findings of the trial court citing the following h cases: Anaeze v Anyaso (1993) 5 NWLR (Part 291) 1; Ike v Ugbaja (1993) 6 NWLR (Part 301) 539; Ibido v Enarofia (1980) 5 – 7 SC 42; Saliba v Yassin (2002) 13 WRN 59 and Awoyoolu v Aro (2001) 21 WRN 41. Learned Counsel urged i the Court to resolve the issue against the appellant. The issue here is whether or not the findings of the learned trial Judge on the issue of the payment of N206,000.00k was supportable by the pleadings and the evidence adduced by j the parties.

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The argument of the appellant’s Counsel was that the a findings of the learned trial Judge was not supported by any evidence adduced at the trial and in view of the material contradiction in the evidence of PW2 and 3 on Exhibit b “MOC 3” and the failure of the respondent to traverse the averment in the appellant’s statement of defence as regards mode of payment of sums of money exceeding N30,000.00k to the cashier, made the findings of the learned trial Judge c on the issue perverse. To fully appreciate this issue it is necessary in the circumstance to consider the evidence as adduced by the PW2 and PW3 and the findings of the learned trial Judge. This is the evidence of PW2 at the trial:– d “I remember 9/5/94 my Director dropped me at Union Bank Forestry, I went into the Bank, into the counting room, there was congestion. I counted the money and paid in the sum of N206,000.00, which was counted with machine, the cashier stamped my teller within the Bank Hall. I know the Cashier only e inside the bank, not outside.” PW2 stated further under cross-examination:– “The Plaintiff signed the signature on Exhibit MOC 3, the Plaintiff gave the money to me and I handed it over to the Cashier . . . I f went to the note counting room. The person who directed me to Cashier is unknown to me. He is a staff in the Bank. The money was counted at 11.30 a.m. He finished at something to one pm I don’t know the person Cashier (sic) attended to before me. I don’t know how long I waited before it came to my turn, nor do I know g the person after me . . . when huge sums are taken to the Bank, they go to the counting room.” PW3 also testified as follows:– h “In 1992, I opened a Current Account with Union Bank Mission Road, Now Forestry. I opened the Account in my personal name. I was given a Current Number of 1971261605. I always put in the account sufficient sums to meet my needs. I am a Distributor to all Lever Brothers products. I was granted one week credit facilities i of N206,000.00 and N206,000.00 for cheque facility. On 6 May, 1994, I issued a cheque Number 85053 worth N205,936.50k to Lever Brothers to cover my credit purchases. I see NOC1, it is the cheque I issued, the date was 5/5/94 against 6/5/94 on 9 May, 1994. I lodged in N206,000.00 to the Bank, through my Cashier j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 415 a P.W.1 5/5/94 against 6/5/94 on 9 May, 1994 (sic). I lodged in N206,000.00 to the Bank, though my Cashier P.W.1 the Lever Brother presented the (sic) cheque on 12 May, 1994, the Bank returned the cheque. I filled the teller myself, and gave money to b the P.W.1 whom I carried to the Bank. I filled in three tellers, the P.W.2 returned with the tellers at about 3 p.m.” Under cross-examination he stated that:– c “I see NOC 4A. I filled it. It is my hand writing. I signed it. I filled the forms in my office and signed it there. On that day I filled in three tellers. The original and duplicate are from the teller. The 3rd teller is from the booklet, NOC 4. It contains two tellers.” The issue at stake here is as rightly submitted by the d respondent’s Counsel and that is whether or not the sum of N206,000.00k was actually paid and received by the appellants cashier I K Nwani in the course of his employment for and behalf of the appellant Bank and not e whether the mode of payment was irregular or who in fact paid the money. In his findings the learned trial Judge evaluated the evidence of the witnesses as adduced before him and came to the above findings as enumerated by the f respondent’s Counsel reproduced in this judgment and went on to hold as follows at page 63 lines 3 – 10 of the record of appeal:– “On the issue of variation of the procedure for payment of sums g above N30,000.00, I believe the testimony of PW2 that she was directed to make payment of the sum of N206,000.00 to the cashier, who received the money as a staff of the Defendant while in the service of the Defendant. The alleged infraction of the rule does not therefore remove the liability of the Defendant. I hold and h rule therefore, that the Defendant received the said sum of N206,000.00 as the sum lodged by the Plaintiff into his Account No. 85053 with the Defendant on 9/5/94.” There is no reason to disturb the findings of the learned trial i Judge on this issue. Evaluation of evidence and the ascription of probative value to such evidence are the primary functions of a court of trial which saw, heard and duly assessed the witnesses. Where a trial court un- j questionably evaluates the evidence and justifiably assesses

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 416 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) the facts, the duty of the Court of Appeal is to find out a whether there is evidence on record on which the trial court could have acted. Once there is sufficient evidence on record from which the trial court arrived at its findings of facts, b the Court of Appeal cannot interfere. The findings of fact made by a trial court are entitled to respect by an Appellate Court when it is clear that the trial court had adequately performed its primary duty of evaluating and ascribing c probative value to the evidence before it. In such circumstances, such findings are to be approached by an Appellate Court with due caution and not on the basis that it would or might itself found otherwise. The essential d consideration is that there is enough evidence on record from which the trial court findings can be supported. See Enang v Adu (1981) 11 – 12 SC 25; Woluchem v Gudi (1981) 5 SC 291; Iwego v Ezeugo (1992) 6 NWLR (Part 249) 561; Joe Goldy Co Ltd v CDB Plc (2003) 5 NWLR e (Part 814) 586 and Ezekwesili v Agbapuonwu (2003) 9 NWLR (Part 827) 337.

An Appellate Court can in appropriate circumstances look f at the evidence on record and make an objective finding of fact where there has been a perverse finding made by a trial court. An Appellate court is competent to tamper with the evaluation of evidence and or findings of a trial court if they g are not based on proper and dispassionate appraisal of evidence given in support of each parties case or where such findings are perverse in the nature of evidence or where on the face of the record it is clear that justice has not been done in the case. See Lawal v Adekoya (1974) 6 SC 83 and h Balogun v Akanji (1988) 1 NWLR (Part 70) 301. In the instant case the learned trial Judge has dispassionately considered and evaluated the evidence before him before coming to the conclusion that the sum of N206,000.00 has in i fact been paid by the respondent to the appellant’s Bank through its cashier Mr Nwani, and I so find. This issue is also resolved in favour of the respondent against the appellant. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 417 a Issue three for determination is whether or not the learned trial Judge was right in his application of section 149(d) of the Evidence Act in the circumstances of this case. b Learned Counsel for the appellant referred to this passage in the judgment of the learned trial Judge wherein he held as follows:– “The conclusion to be drawn thereby is that the money on NOC.3 c was believed to have been received by Mr. Nwani on behalf of the Defendant. If the Defendant did not so believe, they would have called Mr. Nwani to deny receipt of the money, which I have found that P.W. paid to the Defendant through Mr. Nwani. The law of evidence Section 149(d) allows the presumption to be d drawn that Mr. Nwani was not called by the Defendant because if the Defendant had called him, his evidence would have been adverse to the Defendant . . . the presumption to be drawn thereby is that Mr. Nwani would have admitted receipt of the money from P.W.2 if he was called by the Defendant.” e Learned Counsel submitted that section 149(d) of the Evidence Act does not cover a situation of failure to call a particular witness, rather the section applies where a party f withholds a piece of evidence at his disposal. He cited and relied on the case of Oniya v Okoliko (1992) 7 NWLR (Part 254) 500. The learned Counsel contended that the appellant’s case throughout the trial was that the money, the subject matter of this litigation was never received in its g Mission Road Branch. That DW3 testified that Mr Nwani was no longer in the appellant’s employment and that he could not be found. Learned Counsel contended that the learned trial Judge was wrong to have used section 149(d) of h the Evidence Act against the appellant and urged that the appeal be allowed on this ground. For the respondent it was submitted that based on the trial Judge’s appraisal and evaluation of the pleadings and i evidence in this matter and his findings of fact thereon, his application of section 149(d) of the Evidence Act was sound and cannot be faulted. He submitted that the payment of the sum of N206,000.00k was the major issue in the j determination of the suit and Mr IK Nwani having been

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 418 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) proved and accepted to be within reach of the appellants, he a being on police bail, was the only reasonable person to rebut the presumption of the payment. He argued that the trial Judge was right to have invoked the provision of section b 149(d) of the Evidence Act in the circumstances of this case citing the following cases: Tewogbade v Akande (1968) NMLR 404; Onwujoba v Obienu (1991) 1 NSCC 494 and Akintola v Anyiam (1961) All NLR 508. Mr Igbokwe Esq. c submitted that the case of Oniya v Okoliko (supra) cited by the appellant’s Counsel is inappropriate because it concerns matters where other evidence can be called or led in proof of the particular issue as opposed to where only a particular witness can supply such evidence. Learned Counsel also d urged the Court to resolve this issue in favour of the respondent. The question that arises is whether the learned trial Judge e was justified in his application of section 149(d) of the Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990 to the circumstances of this case. Section 149(d) of the Evidence Act provides:– f “The court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events (sic) human conduct and public and private business, in their relation to the facts of the particular case, and in particular the court may presume – g (a) . . . (b) . . . (c) . . . (d) that evidence which could be and is not produced would, h if produced, be unfavourable to the person who withholds it. (e) . . .”. Generally, section 149 of the Evidence Act permits the court i to draw inference from known facts bearing in mind the common course of natural events. It creates a certain presumptions of facts which is the logical inference of the existence of one fact from the proved existence of other j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 419 a facts. This is also the presumption created by this subsection. The contention of the appellant’s Counsel was that the b subsection does not cover a situation of failure to call a particular witness, rather, it applies in a situation where a party withholds a piece of evidence at his disposal. The evidence in issue here is the evidence of I K Nwani the c appellant’s cashier who received the money and reportably (sic) absconded but admitted to be on police bail by DW3, the appellant’s accountant. The trial Judge found as a fact from his evaluation of d evidence and the pleadings that PW2 made payment as on exhibit MOC 3 to the appellant through Mr IK Nwani who it admitted through DW3 to be its staff. The onus of proof therefore shifted to the appellant to rebut the heavy averment e of payment of the money on Exhibit MOC 3 to Mr Nwani and this has not been done and the said IK Nwani was reported to the police by the appellant and is on police bail vide the testimony of DW3. A party generally speaking, is f not bound to call a particular witness if he can prove his case otherwise. See Bello v Kassim (1969) NMLR 148 and Buba v The State (1994) 7 NWLR (Part 355) 195. But if that party cannot otherwise prove his case and he nevertheless withholds the evidence of such a witness, then the sub- g section will apply. The payment of the sum of N206,000 was a major issue in the determination of the suit and I K Nwani having proved and accepted to be within the reach of the appellants, being h on police bail was the only reasonable person to rebut the presumption of the payment. The evidence of I K Nwani will determine this issue to finality one way or the other, it is therefore my candid view that the failure to call I K Nwani i amounts to withholding of evidence. If money was never received as alleged by the appellant, Mr Nwani the cashier would have cleared this issue. The evidence before the Court was that Mr Nwani was on police bail and not that he could j not be found. The fact that he was on police bail suggest

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(sic) that he could be traced and found. There is therefore no a reason to disturb the finding of the learned trial Judge on the application of section 149(d) of the Evidence Act. This issue is also resolved against the appellant. b On the whole this appeal fails and it is hereby dismissed with a cost of N5,000 to the respondent.

The plaintiff/respondent also cross-appealed against the c award of N100,000.00k as being too small on one ground of appeal vide a notice and ground of cross-appeal dated 6 August, 1996. The ground of the cross-appeal and its particulars reads:– d “GROUNDS OF APPEAL 1. The learned trial Judge erred in law when he awarded the Plaintiff the paltry sum of N100,000.00 (One Hundred Thousand Naira) as general damages. e PARTICULARS OF ERROR (a) The Plaintiff having successfully proved wrongful dishonour of his cheque and his trader status is entitled to substantial damages. f (b) The learned trial Judge held that the total sum of N30,000,000.00k (Thirty Million Naira) claimed by the Plaintiff is “too much at large” and awarded N100,000.00 (One Hundred Thousand) only.” g The parties filed and exchanged briefs of argument. In the cross-appellant’s amended brief of argument deemed filed on 24/11/05, prepared by GC Igbokwe Esq., one issue was h formulated for the determination of the appeal. The issue is:– “Whether having regard to his proved trader status, the value of his dishonoured cheque, entitlement to substantial damages for i wrongful dishonour of his cheque, the value of the Naira and volume of his trade, the N100,000.00 damages awarded was based on wrong principles of law and manifestly too low and paltry to warrant interference of this Honourable Court by an upward review.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 421 a In the cross-respondent’s brief of argument prepared by FO Orbih Esq. one issue was also formulated for determination. The issue is:– b “Whether or not there are circumstances in this case to warrant interference by this court in the award of N100,000.00 (One Hundred Thousand Naira) general damages awarded by the trial court in favour of the Cross-Appellant.” c I will adopt the issue as formulated by the cross-appellant’s counsel as it encapsulates all the points to be canvassed. It is the submission of learned Counsel for the cross- appellant that based on case law and authorities, a trader is d entitled to recover substantial damages for wrongful dishonour of his cheque when he has sufficient funds in his account to meet the value of the said cheque. He cited and relied on the following cases: Balogun v National Bank of Nigeria Plc (1978) 3 SC 155; Asubiojo v ACB (1966) 2 All e NLR 203; Union Bank of Nigeria v Nwoye (1996) 3 LRCN 232 and Gibbons v West Minster Bank Ltd [1939] 3 All ER 577. f Learned Counsel submitted that the learned trial Judge found as a matter of fact that the plaintiff/cross-appellant is a trader. He found as proved that his cheque for N205,936.50 issued in favour of Lever Brothers Nigeria Plc was dishonoured when the cross-appellant had sufficient fund g (sic) in his account and that this dishonour was wrongful for which he is entitled to substantial damages. That it was established before the trial court that the cross-appellant was a major distributor to Lever Brothers Nigeria Plc who h suspended his credit facilities and with whom he had an annual turn over of N50,000,000.00k as a distributor in Edo, Delta and Kwara States. Learned Counsel submitted that based on the above facts and the declining value of the i Naira, that N100,000.00k as general damages in the circumstances is rather paltry and manifestly too low and warrants the interference of this Court for an upward review. Applying the criteria in the cases of Balogun v NBN Plc j (supra) and Allied Bank of Nigeria Plc v Akubueze (1997) 6

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KLR 1202, learned Counsel submitted that a court’s award a of damages are not based on geometric calculations but on peculiar circumstances of each particular case, and submitted that the circumstances of this case will warrant a b much more enhanced award of damages. Learned Counsel urged us to hold that the N100,000.00k awarded by the court below is not enough substantial damages for wrongful dishonour of the plaintiff’s cheque for N205,936.50k when c he is a trader and had sufficient funds in his trade account with the cross-respondent bank. Learned Counsel submitted that an appellate court will not interfere with the trial Judge’s assessment of damages d unless it is shown to be based on wrong principles of law or manifestly too high or too low citing Eboh and others v Akpotu (1968) NMLR 278; Ziks Press Ltd v Alvan Ikoku 14 WACA 188; ELF (Nig) Ltd v Sillo (1994) 6 NWLR (Part e 350) 258 and Ijebu-Ode Local Govt v Balogun (1991) 1 NWLR (Part 166) 136. Learned Counsel further submitted that the cross- appellant from paragraphs 17–23 of his amended statement f of claim, pleaded and led evidence of his losses and damages, yet the trial court held that they were not proved in spite of the cardinal rule of pleadings that undenied averments in plaintiff’s pleadings are deemed to be admitted requiring no further proof by evidence. Learned Counsel g referred to the following cases: Egbunike v ACB (1995) 27 LRCN 219; Olale v Ekwelendo (1989) 4 NWLR (Part 115) 326 and Balogun v UBA (1992) 6 NWLR (Part 247) 336. Learned Counsel therefore submitted that the learned trial h Judge’s award of N100,000.00k was based on a wrongful and misconceived principle of law and manifestly too low based on proven facts of the case. Learned Counsel urged the Court to resolve this single issue in the affirmative. i In his response, learned Counsel for the cross-respondent Mr Orbih Esq. submitted that the learned trial Judge had in mind the principle that a trader is entitled to recover substantial damages for the wrongful dishonour of his j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 423 a cheque without pleading and proving actual damages. That the learned trial Judge not only made reference to this principle of law but also supported them with the cases of b Ashubiojo v ACB (1966) 2 All NLR 482 and Union Bank of Nigeria v Nwoye (1996) 35 LRCN 232, learned Counsel argued that there is therefore, no basis for an intervention with the award of N100,000.00k general damages for breach c of contract. That, it is not the business of an Appellate Court to interfere with general damages awarded by a trial court citing UBA v Ademuyiwa (1999) 11 NWLR (Part 628) 570 and Nigeria Bank for Commerce and Industry v Integrated Gas (Nig) Ltd (1998) 8 NWLR (Part 613) 119 and Sabru d Motors (Nig) Ltd v Rajab Enterprises (Nig) Ltd (2002) FWLR (Part 116) 841. Learned Counsel submitted that the finding of the learned e trial Judge that the appellant failed to prove his annual profit or any of the actual items of special damages pleaded save the solicitor’s fee coupled with the fact that the cross- appellant abandoned his claim for general damages, the f N100,000.00k damages awarded by the learned trial Judge is gratuitous and highly generous in the circumstances. Learned Counsel submitted that the reference by the cross-appellant to the award made by the Supreme Court in g Balogun v National Bank of Nigeria (supra) and the other authorities referred to in the brief are not helpful. He said this is so because the cross-appellant has pointed out in his brief that the award of damages are not based on geometric h calculation but in the peculiar circumstances surrounding each particular case. On the cross-appellant’s submission on the declining value of the Naira, learned Counsel referred to the case of i Ifeanyi Chukwu Osondu & Co Ltd v Akhigbe (1999) 11 NWLR (Part 652) 1 and submitted that the cross-appellant’s argument on the issues are of no moment in the absence of any statistics or evidence on the declining value of the j Naira.

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On the cross-appellant’s argument that the learned trial a Judge failed to apply correctly the principle that a trader is entitled to recover substantial damages for the wrongful dishonour of his cheque without pleading and proving actual b damages, learned Counsel submitted that the cross-appellant lost sight of the fact that he pleaded special damages and the finding of the learned trial Judge that there was no evidence given for actual loss by the cross-appellant as a result of the c defendant’s refusal to honour the plaintiff’s cheque was made against the backdrop of the pleading of the cross- appellant on those issues. That the cross-appellant was wrong to have attacked the findings of the learned trial Judge the way he did in his brief of argument when there d was no appeal against that particular finding. The learned trial Judge made the following finding of fact before coming to the conclusion to award the sum of e N100,000 to the cross-appellant thus:– “PW1 also testified that the Plaintiff is the distributor for LBN (Lever Brothers Nigeria) for Edo, Delta and Kwara States. In cross-examination, the said witness could not say what the annual f profit of the plaintiff was and what Plaintiff paid as annual tax. Throughout the hearing, no evidence was given of the actual value of loss sustained by the plaintiff as a result of the refusal of the Defendant to honour the Plaintiff’s cheque to it, when evidence shows that the Plaintiff has sufficient sum in his Account No. g 85053 . . .” Now the question is, is this finding by the learned trial Judge in line with the principles enunciated in the cases of Balogun v National Bank of Nigeria Ltd (supra); UBN Ltd v Nwoye h (supra) and Ashubiojo v ACB (supra) cited by him to support the proposition that a trader is entitled to recover substantial damages for the wrongful dishonour of his cheque without pleading and proving actual damage? i With due respect to the learned trial Judge having fully appreciated and stated the position of the law regarding a trader’s entitlement to substantial damages for the wrongful dishonour of his cheque without proof, he failed to properly j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 425 a apply the proposition to the circumstances of this case. The learned trial Judge having found that the dishonouring of the plaintiffs cheque was wrongful and having stated that b damages to be awarded are at large, he then came to the conclusion that the sum of N30,000,000 claimed by the plaintiff is too much at large. It is indeed too much at large, but what about the award of a paltry sum of N100,000.00? c The plaintiff (cross-appellant) testified as follows at page 26 of the record of appeal lines 26–36:– “. . . By the action of the Bank, I lost an annual profit of N15 Million Naira, I also lost the goodwill of Brothers. I am a first d class chief in my town. The people threatened to withdraw my title. My annual turnover with LBN Plc is between N55 – N60 Million Naira per annum . . . The Lever Brothers have not written to restore my credit facility.” e Under cross-examination the plaintiff stated further:– “. . . I paid tax and VAT of N5,000.00 and a personal tax of N5,000.00 as Director of a Company. I make profit of over N5 million naira . . .” f The learned trial Judge found as a fact that the plaintiff is the distributor for Lever Brothers Nigeria Plc for Edo, Delta and Kwara States. Perhaps the learned trial Judge ran into a serious error when he stated in his judgment at page 63 lines g 29–2 as follows:– “Throughout the hearing no evidence was given of the actual value of loss sustained by the Plaintiff as a result of the refusal of the Defendant to honour the Plaintiffs cheque to it, when evidence shows that the Plaintiff had sufficient sums in his Account No. h 85053.” The principle of law as stated in the authorities cited by the learned trial Judge is that a trader is entitled to recover substantial damages for the wrongful dishonour of his i cheque without pleading and proving actual damage. In effect, the plaintiff is entitled to substantial damages from the court without pleading and proving actual damage once it is proved that the plaintiff’s cheque was wrongfully j dishonoured by the defendant Bank and indeed as found by

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 426 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) the learned trial Judge in this case. The question of proof of a actual loss does not therefore arise in the circumstance of this case. It has been laid down by a long line of authorities that b damages in such cases are at large which means that in such cases, a court may within reasonable limits make an award of any such sum as the court considers the circumstance of the breach of contract to honour a cheque warrants although c there has been no proof of any actual loss to the customer. The mere dishonour of a cheque by a banker is injurious to a person in trade. This is the rationale of the award without proof of actual loss. Where a Banker without d justification dishonours a customer’s cheque, he is liable to a customer in damages for injury to his credit and if the customer is also a trader then damages for such injury to the customer’s credit will also be at large and the court may e award substantial damages although there is no evidence from such a customer of any actual damage suffered by him. In Balogun v ACB (supra) the Supreme Court held that there is no need for the appellant to plead and prove actual f damage in order to be entitled to substantial damages. As the courts award of damages are not based on any geometric calculations but on peculiar circumstances of each case, I agree with the learned cross-appellant’s Counsel that g the circumstances of this case warrant a much more enhanced award of damages especially when the court found as a matter of fact that the plaintiff/cross-appellant is a trader and that the cheque of N205,936.50k issued in favour of h Lever Brothers Nigeria Plc was dishonoured when the cross- appellant had sufficient fund (sic) in his account and that the dishonour was wrongful for which he is entitled to substantial damages. The trial Judge also found as proved that the cross-appellant was a major distributor to Lever i Brothers Nigeria Plc who suspended its credit facilities and with whom he had an annual business turnover of over N50,000,000.00k as distributor in Edo, Delta and Kwara States. Based on the above facts, even without the declining j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA Union Bank of Nigeria Plc v Chimaeze 427 a value of the Naira being taken into consideration, which is quite legitimate for a court to take into consideration in appropriate cases and in a proper manner in the award of b general damages, the cross-appellant deserves a much more enhanced damage. See Ifeanyi Chukwu Osondu Co v Akhigbe (1999) 11 NWLR (Part 675) 1. The judgment of the court below shows clearly that the c learned trial Judge laboured under a serious misconception of the law relating to award of damages in cases of wrongful dishonour of cheque. The law is basic and remains that a proven trader is entitled to recover substantial damages for d wrongful dishonour of his cheque without pleading and proving actual damage. See Balogun v NBN (supra) and Union Bank of Nigeria v Nwoye (supra). This Court is not unmindful of the fact that an Appellate e Court does not make it its business to interfere with award of general damages by the trial court save when the court is satisfied that the trial Judge acted in the award of such damages upon some wrong principle of law or that, the f amount awarded was so large or small as to make it a completely erroneous assessment of the damages, or, where a finding of the trial court is found to be perverse. See UBN Ltd v Ademuyiwa (1999) 11 NWLR (Part 628) 570 and g Nigeria Bank for Commerce and Industry Ltd (1998) 8 NWLR (Part 613) 119. In the instant case, the learned trial Judge clearly laboured under a serious misconception of the law relating to award h of damages in cases of wrongful dishonour of cheque without pleading and proving actual damages. The Appellate Court therefore has power to review and reassess damages awarded by the trial Judge where the Judge in assessing the i same proceeded upon a wrong principle. See Okorji v Ezumah (1961) All NLR 191; Ifeanyi Chukwu Osondu Co. Ltd v Akhigbe (supra) at page 25. On the whole, it is my considered view that the cross-appeal j succeeds on the only question of damages. Accordingly the

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, BENIN DIVISION) Abba-Aji JCA 428 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) judgment of the High Court of Benin in suit no. B/514/94 a dated 31 May, 1996 in so far as only it makes an award of N100,000.00k only to the cross-appellant is hereby set aside and in substitution therefore, it is ordered that judgment be b entered in favour of the cross-appellant against the cross- respondent in the sum of N1,100,000 (one million, one hundred thousand Naira only). The cross-appellant shall have costs assessed and fixed at N5,000 only. c NGWUTA JCA: I agree with the judgment just delivered by my learned brother Abba-Aji JCA.

BULKACHUWA JCA: I have read before now the judgment d just delivered by my learned brother Abba-Aji JCA. I agree with her reasoning for dismissing the substantive appeal and allowing the cross-appeal. I abide by same and all consequential orders therein including orders as to costs. e Appeal dismissed.

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Saleh v Bank of the North Ltd 429 a Saleh v Bank of the North Ltd b SUPREME COURT OF NIGERIA KUTIGI, KALGO, MUSDAPHER, MUKHTAR, ONNOGHEN JJSC

Date of Judgment: 24 FEBRUARY, 2006 Suit No.: SC. 236/2001 c Banking – Payment of money into account by customer – proof of – How done Evidence – Of bank’s employee – Not around when the transaction done – Whether hearsay d Facts The respondent was a Banker and the appellant was its customer. The appellant was a businessman and a licensed e buying agent based in Maiduguri and was carrying on business under the name and style of “Alhaji Abba Satomi Saleh and Sons”. The case of the respondent was that the appellant opened a current account on 18/3/1971 with the f respondent bank. As from November, 1973, at his request, the appellant was granted overdraft facilities on his own personal account and on the g Licensed Buying Agent Account (hereinafter referred to as LBA account) in the sums of N3000 and N12,000.00 respectively. By 1981, at the request of the appellant, the facilities were increased to a total of N400,000.00. As at 30/9/1988, the debit balance of the appellant’s accounts h stood at N2,041,078.73 inclusive of accrued interest and bank charges. The respondent bank used to send regular statement of accounts and letters reminding him of his indebtedness. The appellant on several occasions both in i writing and orally admitted his indebtedness to the respondent bank. To the chagrin of the respondent, on 3/3/1988, 24/5/1988 and 11/7/1988, the appellant denied his indebtedness to the respondent and alleged that the bank had j mismanaged and mishandled his accounts. The respondent

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430 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) denied the claims of the appellant that his accounts were a mismanaged or mishandled. On his own part, the appellant denied the respondent’s claim and asserted that it was the respondent bank that was b indebted to him in the sum of N1,506,510.00 being the total amount of 8 cheques debited against his account without his authority. The appellant claimed that he discovered that the officials of the respondent bank had mishandled and c mismanaged his accounts. He claimed one Mr Chawai Branch Accountant and one Mr Taiwo Assistant Manager had between 1982 and 1983 manipulated his accounts as a result of which they were retired by the bank. d As mentioned above, the trial Judge dismissed the claims of the bank and entered judgment in favour of the appellant. The Court of Appeal reversed the decision of the trial court by allowing the claims of the bank and by dismissing the e claims of the appellant. He therefore appealed to the Supreme Court. One of the reasons for finding against the respondents at the lower court was that the evidence of the employee of the bank was hearsay since he was not around f when the account was opened.

Held – 1. The mere fact that 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. 2. A company such as the respondent bank herein is a h 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 i evidence is not the one who actually took part in the transaction on behalf of the company. Such evidence nonetheless relevant is admissible, will not be discountenanced or rejected as hearsay evidence. j

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Saleh v Bank of the North Ltd 431 a 3. The best way of proving payment of money into a bank account is by the production of bank teller or an acknowledgment showing on the face of it that the bank b has received the payment. A bank teller duly stamped with the official stamp of the bank and properly initialed by the cashier, constitute prima facie proof of payment of the sum therein indicated and a customer, after c producing such a teller or receipt need not prove more unless payment is being challenged. Appeal dismissed. d Cases referred to in the judgment Nigerian ACB v Gwagwada (1994) 5 NWLR (Part 342) 25 e Aeroflot v UBA (1986) 3 NWLR (Part 27) 188 Akinola v Oluwo (1962) All NLR 352 Anyaebosi v RT Briscoe (Nig) Ltd (1987) 3 NWLR (Part 59) 84 f Debs v Cheko (Nig) Ltd (1986) 3 NWLR (Part 32) 846 Ebba v Ogodo (2000) FWLR (Part 27) 2094; (1984) 1 SC 372 g Ezekwesili v Agbapuonwu (2003) FWLR (Part 162) 2016; (2003) 9 NWLR (Part 825) 337 Igbodin v Obianke (1976) 9 – 10 SC 179 Ishola v SGB (Nig) Ltd (1997) 2 NWLR (Part 488) 405 h Kate Enterprises v Daewoo (Nig) Ltd (1985) 2 NWLR (Part 5) 116 Lawal v Dawodu (1972) 8 – 9 SC 83 i Mogaji v Odofin (1978) 4 SC 91 Ogbu v Ani (1994) 7 NWLR (Part 355) 128 Okoya v Santilli (1994) 4 NWLR (Part 338) 256 j Woluchem v Gudi (1981) 5 SC 291

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Counsel a For the appellant: Umaru For the respondent: Onietan b

Judgment

MUSDAPHER JSC: (Delivering the lead judgment) In the High Court of Justice of Borno State of Nigeria in the c Maiduguri Judicial Division and in Suit No. M/166/88, the respondent herein, Bank of the North Ltd as the plaintiff claimed against the appellant herein as the defendant as follows:– d “. . . the sum of N2,041,078.73 (Two Million, Forty-one Thousand and Seventy Eight Naira, Seventy-three Kobo) against the defendant, being the balance due on overdraft and L.B.A. facilities granted to the said defendant as a customer of the plaintiff at his e request from the period of November, 1973 to about 1987 inclusive of accrued interest and other bank charges thereon as at 30/9/1988 which amount the defendant ought to have repaid long ago but has refused or neglected to pay inspite of several demands f by the plaintiff. The defendant’s indebtedness to plaintiff was admitted in writing on several occasions. The plaintiff claims additionally, interest on the said amount of N2,041,078.73 at the rate of 17% per annum from the 1 October, 1988 till the day of final payment of the judgment debt to be g obtained herein plus costs of this suit.” The appellant, Alhaji Abba Satomi Saleh, as the plaintiff in Suit No. M/32/89 claimed against the respondent, herein as h the defendant, in paragraph 13 of the statement of claim as follows:– “13 (a) A declaration that the removal of the total of N1,506,610.00 by the agent and/or servant of the i defendant from the Current Account No. 400085 and licenced buying agents Account Nos. 410093B and 410096B of the plaintiff through payment on cheques not issued or authorised by the plaintiff is wrong, null and void. j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Musdapher JSC Saleh v Bank of the North Ltd 433 a (b) A declaration that the defendant by the acts of its servant or agents has breached the sacred relationship between a bank and its customer. b (c) An order that the defendant should repay to the plaintiff the total sum of N1,506,610.00 wrongly and negligently debited from the Current Accounts Nos. 410096B and 410093B. (d) N100,000.00 general damages”. c Pleadings were duly settled, filed and exchanged in each of the two suits which were eventually consolidated and tried together by the trial Judge. At the hearing, the respondent d herein called three witnesses and tendered a number of documents, while the appellant testified and called a witness. After the addresses of Counsel, in its judgment delivered on 25/5/1995, the trial court dismissed the claims e of the plaintiff in Suit No. M/166/88, while the claims in Suit No. M/32/89 were allowed. Bank of the North Ltd, the respondent herein felt unhappy and appealed to the Court of Appeal, Jos Division. The Court of Appeal after hearing the appeal, in its judgment delivered on 15/6/1999 reversed the f decision of the trial court by granting the reliefs sought by Bank of the North Ltd in Suit No. M/166/88 and by dismissing the claims of the appellant herein, in Suit No. M/32/89. This, now is an appeal by Alhaji Abba Satomi g Saleh as substituted, with leave of this court, with his son Muazu Abba Satomi Saleh. Now, the parties shall be referred to hereafter as the appellant and the respondent as the case may be. But before I discuss the issue for h determination in this appeal, it shall be necessary to set out the background facts. Based on the pleadings and the evidence led at the trial, the facts of the case may be summarised as follows:– The i respondent is a banker and the appellant was its customer. The appellant was a businessman, a licensed buying agent based in Maiduguri, and was carrying on business under the name and style of “Alhaji Abba Satomi Saleh and Sons”. j The case of the respondent was that the appellant opened

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Musdapher JSC 434 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) a current account on 18/3/1971 with the respondent bank. As a from November, 1973, at his request, the appellant was granted overdraft facilities on is own personal account and on the licensed buying agent account herein referred to as b (LBA account) in the sums of N3,000 and N12,000 respectively. By 1981, at the request of the appellant, the facilities were increased to a total of N400,000. As at 30/9/1988, the debit balance of the appellant’s accounts c stood at N2,041,078.73 inclusive of accrued interest and bank charges. The respondent bank used to send regular statement of accounts and letters reminding him of his indebtedness. The appellant on several occasions both in writing and orally admitted his indebtedness to the d respondent bank. To the chagrin of the respondent, on 3/3/1988, 24/5/1988 and 11/7/1988, appellant denied his indebtedness to the respondent and alleged that the bank had mismanaged and mishandled his accounts. The respondent e denied the claims of the appellant that his accounts were mismanaged or mishandled. On his own part, the appellant denied the respondent’s claim and asserted that it was the respondent bank that f was indebted to him in the sum of N1,506,510 being the total amount of eight cheques debited against his account without his authority. The appellant claimed that he discovered that the officials of the respondent bank had g mishandled and mismanaged his accounts. He claimed one Mr Chawai, Branch Accountant and one Mr Taiwo, Assistant Manager had between 1982 and 1983 manipulated his accounts as a result of which they were retired by the h bank. As mentioned above, the trial Judge dismissed the claims of the bank and entered judgment in favour of the appellant. The Court of Appeal reversed the decision of the trial court i by allowing the claims of the bank and dismissing the claims of the appellant. The appellant has filed five grounds of appeal from which one issue has been identified, formulated and submitted to j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Musdapher JSC Saleh v Bank of the North Ltd 435 a this Court for the determination of the appeal. The issue reads:– “Was the court below right having regard to the pleading the b evidence on the printed record and the circumstances of this case to have reversed the findings and judgment of the trial court?”. The respondent has more or less formulated the same issue for the determination of the appeal. c All the arguments of the appellant centred on and complained of the Court of Appeal setting aside and overruling the findings of facts made by the learned trial Judge. It is argued that the learned trial Judge had properly d reviewed and appraised the entire evidence before he came to the conclusion that the respondent had not “shown on the preponderance of probability that the defendant is owing the bank the amount claimed. The suit is hereby dismissed”. The e Court of Appeal on the other hand, came to the conclusion, that the appellant having pleaded that he repaid the overdraft of N400,000 and would rely on proof thereof on “all the other relevant bank documents showing that he had paid f back to the plaintiff the sum of N400,000.00”. The proof by his mere “ipse dixit” that he had repaid was not enough. He had failed to establish the repayment by adducing evidence through the “relevant documents i.e. tellers, cheques etc”. It g was also the findings of the lower court that the repayments were not specifically pleaded nor were they indeed proved and accordingly, the Court of Appeal found that the appellant had, having admitted the debt, failed to establish that he had paid the debt. h In its judgment, the Court of Appeal held:– “Despite the plethora of documentary evidence . . . which the appellant (the bank) tendered in proof of its case, the learned trial i Judge dismissed its case. In so doing he gave three main reasons; firstly, that one of the three witnesses, PW1, PW2 and PW3 was not there when the respondent opened the account with the bank, secondly, that he believed the respondent paid the amount he claimed he paid and thirdly, that the respondent’s manipulation of j his account as confirmed by DW1 was true.”

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I entirely agree with the opinion of the court below, that the a mere fact that a bank staff was not around when a customer’s bank account is opened was not enough to prevent the staff from testifying or giving evidence on the b customer’s account. See Kate Enterprises Ltd v Daewoo Ltd (1985) 2 NWLR (Part 5) 155; Ishola v SGB (Nig) Ltd (1997) 2 NWLR (Part 488) 405; Anyaebosi v RT Briscoe (Nig) Ltd (1987) 3 NWLR (Part 59) 84 and Igbodin v Obianke (1976) c 9 – 10 SC 179. It is settled law, that a company such as the respondent bank herein is a juristic person and can only act through its agents or servants. Any agent or servant can consequently d 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. Such evidence is none- e theless relevantly admissible, will not be discountenanced or rejected as hearsay evidence. The learned trial Judge was clearly in error to have ignored evidence led by the respondent’s witnesses on the ground merely that they were not around when the appellant opened its account with f respondent bank. In a situation such as this, where the appellant claimed to have repaid the loan overdraft against statements of accounts tendered by the respondent bank showing non- g payment by the appellant, the proof of payment by the mere “ipse dixit” of the appellant cannot be sufficient proof of repayment of the debt. See Debs v Cheko (Nig) Ltd (1986) 6 SC 176. h The best way of proving payment of money into a bank account is by the production of a bank teller or an acknowledgment showing on the face of it that the bank has received the payment. A bank teller duly stamped with the i official stamp of the bank and properly initialed by the cashier, constitutes prima facie proof of payment of the sum therein indicated and a customer, after producing such a teller or receipt need not prove more unless payment is j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Musdapher JSC Saleh v Bank of the North Ltd 437 a being challenged; see Ishola v SGB (Nig) Ltd (supra) and Aeroflot v UBA (1986) 3 NWLR (Part 27) 188. On the issue of the manipulation of the appellant’s b account by the staff of the respondent, in my view, the learned trial Judge failed to consider the evidence led by the respondent, that the complaint of the appellant was fully investigated and was found to be baseless and the appellant c was duly informed in exhibit “L”. The statements of accounts referred to above – exhibits “E1” – “E35” were tendered by the plaintiff/ respondent in proof of the debt owed, the statements of accounts were not falsified by the d appellant and no entry was shown or proved to be wrong. The appellant did not pinpoint any error even when all the cheques issued by him, exhibits “J1” – “J820” were made available to him particular (sic), he did not identify the eight e cheques he disagreed with. I am of the firm view that the allegation of mishandling of the account appears to me to be a mere ploy or subterfuge to avoid repayment of the overdraft. f Further to the above, in exhibits “H1” and “H2”, the appellant wrote to the respondent admitting his indebtedness. I reproduce exhibit “H1” dated 29/11/1982:– “The Area Manager, Bank of the North Ltd., Maiduguri Branch. g Dear Sir, With reference to my letter dated 11/11/1982, I agree to liquidated (sic) my debts from the following sources–– Sources Amount h (a) Construction contract N 656,250.00 (b) Produce business N 212,000.00 (c) School food supply N 168,000.00 i N1,036,250.00

The appellant went further to ask for additional loan or overdraft to “Finance Basalah Industries Ltd., a company j wholly owned by me to the production level.”

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In my view, the trial court completely abdicated its a responsibility of properly evaluating and of appraising the entire evidence led before it. It has also misdirected itself on the onus and inferences from the evidence adduced. But the b law is settled that an appellate court shall not ordinarily interfere with the verdict of a trial court. In the case of Ogbu v Ani (1994) 7 NWLR (Part 355) 128 at 140 Belgore, JSC stated thus:– c “This court has on several occasions warned against interfering with the conclusion of a trial court on facts. A trial court has many advantages a Court of Appeal never has. It sees the witnesses, hears them and assesses their demeanour and makes finding in line with what in law is admissible. It is the trial court that can assess d the veracity of a witness before it. Onuoha v State (1989) 2 NWLR (Pt.101)23. It is not the function of the appellate court to interfere with the findings of trial courts on facts. There are however exemptions to this rule. If the finding is not supported by evidence, e that finding shall be set aside by the appellate court, also when the finding is supported by evidence but that evidence is by law not admissible or the finding is perverse, it will be set aside by the appellate court. See Chukwoeke v Nwankwo (1985) 2 NWLR (Pt. 6) 195; Egbase v Oriareghan (1985) 2 NWLR (Pt. 10) 884; Ajuwa f v Odili (1985) 2 NWLR (Pt. 9) 710; Ogbechie v Onochie (1986) 2 NWLR (Pt. 23) 484; Agbonifo v Aiwereoba (1985) 1 NWLR (Pt. 70) 325.” Since the trial court had abdicated its duty in relation to the g proper appraisal of the evidence, the Court of Appeal was in a good position to do so to ensure that justice is done to both parties. As shown at the beginning of the judgment, the case of the respondent bank was simple and straightforward. h There was no dispute that the appellant at his request applied for and was granted loan facilities. There was no dispute that the appellant enjoyed the facilities. The appellant wrote letters, such as exhibit “III” admitting his indebtedness to the respondent. In his pleadings, he claimed to have repaid i the loans. It was incumbent on him under the circumstances to prove the payment. He cannot by his mere ipse dixit sufficiently prove repayment as against the tendered cheques and the statements of account which he could not falsify. He j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Musdapher JSC Saleh v Bank of the North Ltd 439 a did not prove the repayment as he averred to in his pleadings by relying on “all the other relevant bank documents”. The appellant also claimed that there was a manipulation b of his accounts by the staff of the respondent. He simply failed to establish the allegation and as mentioned above, the respondent caused evidence to be given that the allegation was investigated and was found to be false. The statements c of accounts and the cheques issued by the appellant were all placed before the court and the appellant did not “rely” on them to establish his claims nor did the appellant identify the eight cheques he claimed were not issued by him. I agree d with the decision of the Court of Appeal, that the appellant did not lead credible evidence to entitle him to judgment while the respondent “had led sufficient credible evidence to be entitled to judgment to his claims”. e Under the circumstances, the Court of Appeal is clearly justified in re-evaluating the evidence and in drawing correct inferences from the primary fact established. In the case of Ezekwesili v Agbapuonwu (2003) FWLR (Part 162) 2016; f (2003) 9 NWLR (Part 825) 337, it was held that an appellate court has always the competence to interfere or disturb the evaluation of evidence and findings of fact which are not based on proper and dispassionate appraisal of the evidence g given in support of each party’s case or where such findings are perverse in the nature of the evidence and the pleadings or where on the face of the record, justice has not been done in the case. h Consequently, the Court of Appeal was in a position to have properly evaluated the evidence adduced by the parties in the course of its judgment and to hold that the respondent proved its case on balance of probabilities and the appellant i had failed to establish his claims. See Mogaji v Odofin (1978) 4 SC 91; Woluchem v Gudi (1981) 5 SC 291; Ebba v Ogodo (2000) FWLR (Part 27) 2094; (1984) 1 SC 372. I must in the end resolve this single issue against the j appellant. I accordingly dismiss the appeal and affirm the

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Musdapher JSC 440 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) judgment of the Court of Appeal. The respondent is entitled a to costs assessed at N10,000 against the appellant.

KUTIGI JSC: I have had the advantage of reading before b now the judgment just delivered by my learned brother, Musdapher JSC. I agree with his reasoning and conclusion that the appeal lacks merit. I accordingly dismiss it with N10,000 costs against the appellant and in favour of the c respondent. The judgment of the Court of Appeal is confirmed.

KALGO JSC: I have had the privilege of reading in advance d the judgment just delivered by my learned brother, Musdapher JSC in this appeal. I entirely agree with him that there is no merit in the appeal and it ought to be dismissed. I dismiss it accordingly and affirm the decision of the Court e of Appeal. I award N10,000 costs in favour of the respondent.

MUKHTAR JSC: I have had a preview of the judgment delivered by my learned brother, Musdapher JSC. The f reliefs sought by the appellant who was then the plaintiff in the High Court of Justice of Borno State are:– “(a) A declaration that the removal of the total of N1,506,610.00 g by the agents and/or servants of the defendant from the Current Account No. 400085, and licensed buying agents Account Nos. 410093B and 410096B of the plaintiff through payments on cheques not issued or authorised by the plaintiff is wrong, null and void. h (b) A declaration that the defendant by the acts of its servants or agents has breached the sacred relationship between a bank and its customer. (c) An order that the defendant should repay the plaintiff the i total sum of N1,506,610.00 wrongly and negligently debited from Current Account No. 400085 and licensed buying agents Accounts Nos. 410096B and 410093B. (d) N100,000.00 general damages.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Mukhtar JSC Saleh v Bank of the North Ltd 441 a Prior to the above claim, the defendant therein in another suit claimed as follows against the respondent in this appeal:– b “Wherefore the plaintiff claims from the defendant the sum of N2,041,078.73 (Two Million, Forty-one Thousand and Seventy- eight Naira, Seventy-three Kobo) being the balance due from him on the facilities granted to him by the plaintiff inclusive of accrued interest and other bank charges thereon as at 30/9/88; plus interest c therein at the rate of 17% per annum from 1 October, 1988 till the day of final payment of the judgment debt due to be obtained herein in addition to the costs of this suit.” The two suits were consolidated and the learned trial Judge d in his judgment found thus in respect of the first suit:– “In view of the evidence reviewed above, I do not think the plaintiff, the Bank of the North has shown on the preponderance of probability that the defendant is owing the bank, the amount e claimed.” In respect of the second suit he found as follows:– “I find it proved by his evidence that his account has been debited by these cheques to a total sum of N1,506,610.00. He is entitled to f his money. I will enter judgment for him against the defendant, the Bank of the North for the sum of N1,506,610.00 and current interest which according to his counsel is 21%.” The Bank of the North was dissatisfied with the decision, so it appealed to the Court of Appeal on ten grounds of g appeal. The Court of Appeal found merit in the appeal, and it allowed it. Alhaji Abba Satomi Saleh was aggrieved by the judgment of the Court of Appeal and he has appealed to this Court on five grounds of appeal. Briefs of argument h were exchanged by learned Counsel. Only one issue for determination was raised in the appellant’s brief of argument, to cover all the five grounds of appeal. The issue is:– i “Was the court below right having regard to the pleadings, the evidence on the printed record and the circumstances of this case to have reversed the findings and judgment of the trial court.” The issue raised in the respondent’s brief of argument is in j pari materia with the above issue.

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The appellant’s grouse is premised on the reversal of the a of facts of the learned trial Judge by the appellate court below, and a portion of the judgment in which there was such reversal, and the appellant is attacking reads:– b “Apart from the fact that the above payments were not specifically pleaded, no documentary evidence was tendered as evidence of the payments despite respondent’s averment in paragraph 8 of his statement of his defence quoted above that he would rely on all the relevant bank documents showing that he paid back to plaintiff the c sum of N400,000.00. It is my candid view that the respondent by the mere “ipse dixit” evidence adduced by him not supported by any bank tellers, credible notes etc had failed to discharge the burden of establishing repayment of the credit facilities granted to d him by appellant.” In his judgment, the learned trial Judge found as follows on the said payments:– “The defendant, Alhaji Satomi in his evidence said that he is not e owing the bank. He said he paid some amounts to his bank account, the amounts include N1,280.00. He said he also paid N60,000.00, N150,000.00, N200,000.00 and N400,000.00, he said his account was mishandled. He said he has no account as 410055, 410040, 410097, 410027, f 410041, 33427, 4100953. I believe his evidence.” I don’t think the defendant/appellant needed to specifically plead the various amounts paid to the respondent, as argued by learned Counsel for he has already pleaded the sum total g of N400,000 which he said he paid back. It is not every fact that needs to be pleaded. See Okoya v Santilli (1994) 4 NWLR (Part 338) 256 and ACB v Gwagwada (1994) 5 NWLR (Part 342) 25. h The only grave omission is the absence of documentary evidence which he could rely on, but which he did not produce. Such evidence that has documents to buttress it are expected to be backed by documents. i This is beyond the question of demeanour for the whole (sic) revolves around documentary evidence. Although it is the prerogative of a trial Judge who sees, watches, and listens to a witness to assess and determine his j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Mukhtar JSC Saleh v Bank of the North Ltd 443 a demeanour, the Appellate Court will interfere where he did not make good use of that advantage, and when a finding based on evidence is perverse and not supported by credible b and cogent evidence. See Akinola v Oluwo (1962) All NLR 352; Lawal v Dawodu (1972) 8 – 9 SC 83 and Woluchem v Gudi (198l) 5 SC 291. With the above reasoning and the detailed treatment of the c issue in the lead judgment, I am of the firm view and agree with my learned brother that the appeal lacks merit and substance, and deserves to be dismissed in its entirety. I abide by all the consequential orders made in judgment. d ONNOGHEN JSC: I have had the opportunity of reading in draft, the judgment of my learned brother, Musdapher JSC just delivered. e I agree with his reasoning and conclusion that the appeal is without merit and should be dismissed. The primary issue in this appeal involves evaluation of evidence, question being whether the appellant proved his f case against the respondent on preponderance of evidence. The facts of the case have been stated in detail in the lead judgment of my learned brother, and I do not intend to repeat them herein except as may be needed to emphasise g point(s) being made. From the facts as pleaded, the appellant has the burden of proving that the respondent negligently debited his account to the tune of N1,506,610. This claim sounds more in special h damages than in general damages. The law is that special damages must not only be specifically pleaded, but it must also be strictly proved. Appellant does not dispute the fact that he took an overdraft/loan facility of N400,000 from the i respondent. However, whereas the respondent avers that appellant has failed to repay the facility, appellant contends that he has done so and that his account was negligently debited to the tune of N1,506,610 which he claims from the j respondent.

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The case of the appellant, are as pleaded inter alia, in a paragraphs 6, 7, 8, 9, 10, 11 and 12 of the statement of claim:– “6. The plaintiff sometime between late 1984 and early 1985 b complained to the then General Manager of the defendant, Maiduguri that certain officers of the defendant bank to wit; Alhaji Chawai and Mr. Taiwo were mishandling his accounts, as a result of which the defendant assigned one of its officers to cross check the operations of the plaintiff’s c accounts. 7. The plaintiff avers that the result of the cross-checking (sic) never made known to him, nor were both Mr. T. Alhaji Chawai asked to explain the complaints of the plaintiff d on the mishandling of Current Account No. 400085 and licensed buying agents accounts Nos. 4l0096B and 410093B. 8. The plaintiff not being satisfied with the continous handling of his accounts by the agents, and/or servant of the e defendant, and on attempt to reconcile his account with the defendant discovered that the agents and/or servants of the defendant had debited on various dates between 1980 and 1982 various sums amounting to sum of N1,506,610.00 from the plaintiff’s 3 accounts with the defendant. f 9. The plaintiff further avers that the debiting of his 3 account– Current Accounts No. 400085 and licensed buying agent account Nos. 410093B and 410096B by the agents and/or servants of the defendant to the tune of N1,506,610.00 was g done by making payments on Bank of the North cheques which were neither issued nor authorised by the plaintiff or made with the plaintiff’s consent. 10. The Bank of the North cheques for which payments were made and money debited from plaintiff’s 3 accounts by the h agents and/or servants of the defendant bank, without the consent, knowledge and/or authority of the plaintiff are as follows–– (a) On current account No. 400085 i 5/11/80 cheque No.005/62 – N 60,000.00 4/3/81 cheque No. 101194 – N 50,000.00 16/3/81 cheque No. 11621 – N 85,000.00 14/8/81 cheque No. 116284 – N 43,000.00 5/5/82 cheque No. 146457 – N 94,800.00 j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onnoghen JSC Saleh v Bank of the North Ltd 445 a (b) License buying agent account No. 410096B 27/1/81 cheque No. 104514 – N 120,000.00 31/1/81 cheque No. 104528 – N 178,000.00 b (c) Licence buying agent account No. 410093B– Cheque No. 147202 – N 100,000.00 Previous amount discovered – N 100,655.00 The plaintiff shall at the trial rely on and tender all the c cheques as stated in paragraph 10 and hereby gives notice under Section 97 of the Evidence Act to the defendant to produce same from its custody. 11. The plaintiff shall also rely on and tender at the trial the d defendant’s ledgers covering current account No. 400085 and licensed buying agents account Nos. 410093B and 410096B, to establish that his 3 accounts with the defendant bank were wrongly and/or negligently debited by the agents and/or servants of the defendant. The defendant is hereby e given notice under Section 97 of the Evidence Act Cap. 112 Laws of the Federation of Nigeria, 1990 to produce at the trial the complete bank ledgers as stated above. 12. The defendant has in spite of demands made by the plaintiff f failed, refused and/or neglected to repay the plaintiff the sum of N1,506,610.00 wrongly and/or negligently debited/ removed from his 3 accounts with the defendant. The plaintiff shall at the trial rely on and tender two letters dated 11/7/88 and 12/10/88 written to the defendant on this issue g . . .” The respondent, of course denied the averments and specifically claimed the sum of N2,041,078.73 as being the balance outstanding on account of loan and credit facilities h granted the appellant, which appellant admitted owing but had refused and/or neglected to pay inspite of repeated demands. At the trial, the appellant testified and called one witness i but did not tender the statement of account or ledgers he pleaded in paragraphs 10 and 11 of the statement of claim, from which it would have been possible to prove his allegations of manipulation of his account by the agents, j and/or servants of the respondent resulting in the negligent

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onnoghen JSC 446 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) and wrongful, debiting of his said accounts. It is equally a very important to note that the appellant also never tendered the eight cheques purportedly forged so as to prove the amount which were allegedly negligently debited to b appellant’s account. Though the appellant failed and/or neglected to tender the aforesaid relevant documents, the respondent duly tendered them in evidence but appellant never relied on same in proof c of his case. He was thus offered an opportunity by the respondent to prove his allegations against the respondent but he woefully failed to utilise same. Surprisingly, the trial court entered judgment in favour of the appellant in the d following words:– “I would therefore not regard this claim by Alhaji Satomi as an afterthought. I find it proved by his evidence that his account has been debited by these cheques to a total sum of N1,506,610.00. He is entitled to his money. I will enter judgment for him against the e defendant, the Bank of the North for the sum of N1,506,610.00 and current interest which according to his counsel is 21%.” It is clear from the statement of claim that appellant never pleaded the issue of interest but the learned trial Judge f awarded 21%, according to the learned trial Judge is what learned Counsel for the appellant claimed – not in the pleadings. That apart, when the figures pleaded as evidenced by the cheques allegedly paid wrongfully by respondent are g added up, the total value is N731,000 but the figure claimed by the appellant as per paragraph 13 of the statement of claim is N1,506,610 which was duly awarded by the learned trial Judge. No one knows what the difference between the sum of N731,000 and N1,506,610 stands for. Certainly, that h sum has not been strictly proved in evidence. However, the learned trial Judge, as stated earlier awarded the whole sum of N1,506,610, being special damages. i When confronted with the facts, the Court of Appeal had no alternative than to re-evaluate the evidence on record and made the following findings:– “Looking at the parties’ pleadings reproduced above, it is clear to me that the respondent having admitted being granted overdraft j

[2004 – 2006] 13 N.B.L.R. (PART II) (SUPREME COURT OF APPEAL) Onnoghen JSC Saleh v Bank of the North Ltd 447 a facilities to the tune of N400,000.00 by the appellant, there is no burden on the appellant to prove that which has been admitted. On the contrary, it is the respondent who asserted repayment who has the burden of proving such repayment . . .” b The Court of Appeal also found that despite the claim of the appellant of having repaid the loan of N400,000, he tendered no document such as bank tellers, credit notes, etc. in proof c and therefore held that appellant failed to discharge the burden placed on him to prove that he repaid the loan. Turning to the case of the respondent, the Court of Appeal found, inter alia thus:– d “In the instant case where the appellant is saying that the respondent has not repaid the overdraft granted to him and has tendered statements of accounts exhibits E1 – E35 showing the outstanding amount, the respondent’s mere ipse dixit evidence of e repayment is insufficient proof thereof . . .”. That apart, there is evidence that appellant admitted his indebtedness to the respondent in various correspondence on the matter which were tendered in evidence. f I hold the view that in view of the facts as pleaded and the totality of the evidence before the lower court, that court is justified in interfering with the rather strange findings of fact by the trial court which were rightly, in my opinion, set g aside by that court. From the appellant’s brief, I am unable to see where learned Counsel for the appellant has demonstrated how the lower court was wrong in its decision by setting aside the judgment of the trial court. In my view, h the lower court took pains to examine the totality of the evidence adduced by the parties, identified and went into the issues raised in the pleadings in arriving at (sic) decision that it is the appellant who has the burden of proving the i allegations of negligently debiting the appellant’s accounts to the tune of N1,506,610 and that he failed to discharge that onus and consequently dismissed his claim. In conclusion, I too find no merit whatsoever in this j appeal which is accordingly dismissed.

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I abide by the consequential orders contained in the lead a judgment of my learned brother, Musdapher JSC including the order as to costs. Appeal dismissed. b

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Continental Trust Bank Ltd v The Gov. of Kogi State of Nigeria 449 a Continental Trust Bank Ltd v The Government of Kogi State of Nigeria and others b FEDERAL HIGH COURT OF NIGERIA, ABUJA DIVISION NYAKO J

Date of Judgment: 10 MARCH, 2004 Suit No.: FHC/ABJ/CS/145/2004 c Banking – Banker/customer relationship – Jurisdiction of Federal High Court Jurisdiction – Federal High Court – Banker/customer d relationship – Federal High Court possessing

Facts e This ruling stems from the objection filed and argued by the first and second defendants on the grounds that the third defendant is not a necessary party to the suit, that the dispute is between the plaintiff as the lender and the first and second f defendants as the borrowers and not the third defendant who is an agency of the Federal Government and that the subject matter is not within the jurisdiction of this Court and urges the Court to strike out the name of the third defendant g from this suit and to strike out the entire suit for want of jurisdiction. The defendants’ argument is to the effect that the subject matter of the suit being one of a banker and its customer, the h Federal High Court lacks jurisdiction to entertain same, and further that being a simple contract the Federal High Court still lacks jurisdiction. i The plaintiff’s argument is that by the authority of NDIC v Okem, the Federal High Court has concurrent jurisdiction with the State High Court, so that even if the third defendant is struck out of the suit the Federal High Court would still j have jurisdiction.

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Held – a In banker/customer relationships both the Federal High Court and High Court of States have jurisdiction (NDIC v Okem (2004) 10 NWLR (Part 880) 107 refers.) b Overruling the objection.

Case considered in the ruling c Nigerian NDIC v Okem (2004) 10 NWLR (Part 880) 107

Counsel d For the plaintiff: Iorshe For the first defendant: Ajulo

Judgment e NYAKO J: This ruling stems from the objection filed and argued by the first and second defendants on the grounds that the third defendant is not a necessary party to the suit, that the dispute is between the plaintiff as the lender and the f first and second defendants as the borrowers and not the third defendant who is an agency of the Federal Government and that the subject matter is not within the jurisdiction of this Court and urges the Court to strike out the name of the g third defendant from this suit and to strike out the entire suit for want of jurisdiction. The defendants’ argument is to the effect that the subject matter of the suit being one of a banker and its customer, the h Federal High Court lacks jurisdiction to entertain same, and further that being a simple contract the Federal High Court still lacks jurisdiction. He relied on the authorities of Onuorah v KRPC Ltd and Savannah Bank Plc v Sani i Ibrahim and that the case of NDIC v Okem was decided per incuriam. Further that the third defendant is not a necessary party in this suit in that what is in dispute is the amount of interest j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Nyako J Continental Trust Bank Ltd v The Gov. of Kogi State of Nigeria 451 a payable to the plaintiff and the fact that it would be paid from the statutory allocation of the defendant, it is not from the Federal Government Revenue as the money would by b this stage become revenue of Kogi State. He urged the Court to grant their relief and strike out the suit. The plaintiff’s argument is that by the authority of NDIC v Okem, the Federal High Court has concurrent c jurisdiction with the State High Court, so that even if the third defendant is struck out of the suit the Federal High Court would still have jurisdiction. On the presence of the third defendant, the plaintiff d argued that for the third defendant to be bound by the decision of the Court they become a necessary party since the third defendant is the one expected to pay to the plaintiff from the first defendant’s share of the allocation. That the e agreement was for both principal sum and interest to be paid from the revenue accruable to the first defendant. He urged the Court to discountenance the object (sic) and assume jurisdiction. f By the admission of the first and second defendants, the case is premised on a relationship of banker and its customer. Since the Counsel on record does not represent the third defendant, I shall ignore all arguments that pertain g to the presence of the third defendant in the suit. But even if the third defendant is struck out of the suit, the subject matter will still be lender/banker and borrower/customer. By the authority of the case of NDIC v Okem (2004) 10 h NWLR (Part 880) 107, the Supreme Court has dealt in detail on the jurisdiction of the Federal High Court and the High Court of the States in banker/customer relationship. If this is the relationship of the parties then even if the i third defendant is struck out of the suit, the Federal High Court will still be vested with jurisdiction over the subject matter. This has gone outside simple contract and cannot fall j under the Onuorah case. Section 251 was found to vest

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First Bank of Nigeria Plc v Jibo 453 a First Bank of Nigeria Plc v Jibo b COURT OF APPEAL, JOS DIVISION AKAAHS, NZEAKO, TSAMIYA JJCA Date of Judgment: 23 MARCH, 2006 Suit No.: CA/J/230/98

Appeal – Additional evidence on appeal – Failure to tender c equitable mortgage at trial court – Application to tender at Court of Appeal – Power of Court of Appeal – Order 1 rule 19(2) Court of Appeal Rules, 2002 d Mortgage – Equitable mortgage – Failure to tender at trial court – Application to Court of Appeal to receive in evidence – Guiding principles Mortgage – Equitable mortgage – How to prove e Facts The appellant’s application at the Court of Appeal sought the following reliefs:– f “1. An order granting leave to the appellant/applicant to give additional evidence on appeal by, tendering the equitable mortgage dated 19/10/82 and registered as No. 247 at Page 247 in Volume II Miscellaneous of the Lands Registry in the g office at Makurdi, copy annexed hereto as exhibit 35A. 2. An order receiving the equitable mortgage exhibit 35A hereto as additional evidence. 3. Leave to amend the appellant’s brief of argument”. h The application is supported with an 8-paragraph affidavit to which was annexed the certified true copy of the equitable mortgage attached as exhibit “35A”. A further affidavit of nine paragraphs still attaching the certified true copy of the i equitable mortgage was deposed to by Bridget Ajah and a second further and better affidavit also containing nine paragraphs to which was attached a copy of the receipt of payment for the amended appellant’s brief marked exhibit j “36” was also deposed to by Bridget Ajah.

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The application was opposed by the respondent and a a counter-affidavit containing five paragraphs was deposed to by John Hiinan, who is the litigation secretary in the law office of S A Ngavan & Co. b The grounds upon which the application is brought are:– 1. Two deeds of mortgage – one legal, the other equitable mortgage were executed by the parties. c 2. Only the legal mortgage was tendered as exhibit “35”. 3. The equitable mortgage which is earlier in time though acknowledged by the respondent was not tendered in evidence. d 4. The existence of this document was discovered only on 1 February, 2005. 5. The former Counsel of the appellant was not aware of the existence of this document. e 6. Both parties had acknowledged the existence of document in their pleadings. Mr Okafor, SAN, in his oral submission argued that the f respondent has not been taken by surprise. He submitted that the mistake in not tendering the document in the court below should not be visited on the applicant and if allowed to stand, can only lead to technical justice and urged this Court to lean on the side of substantial justice by allowing the g appellant (sic) adduce additional evidence. Mr Ngavan, learned Counsel for the respondent in opposing the application relied on the affidavit filed in h opposition and submitted that the grounds upon which the application has been brought are not tenable especially grounds four and five because the document was available but due to the misjudgment of Counsel, he did not tender it as evidence in the lower court. He submitted that where i mistake of Counsel amounts to incompetence or a misjudgment the litigant should not be excused and cited the following cases in support: Elike v Nwankwoala (1984) 12 SC 301 at 310; 312; Mosheshe General Merchants Ltd v j

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First Bank of Nigeria Plc v Jibo 455 a Nigeria Steel Products Ltd (1987) 2 NWLR (Part 55) 110; (1987) 4 SCNJ 11 at 16 – 17; A-G of the Federation v Alkali Modu (1972) 12 SC 29 at 30 – 32. b He therefore urged this Court to dismiss the application.

Held – 1. By virtue of section 133(1) of the Evidence Act, no c evidence of the equitable mortgage may be given in court except the production of the document itself, nor can its contents be contradicted by oral evidence, and, an appeal court is in as good a position as a trial court to d evaluate its effect on the matter before the court, after hearing Counsel for both parties. 2. It is not open as of right to any party to an appeal to adduce new evidence in support of his original case; but, e for the furtherance of justice, the court may, where it thinks fit, allow or require any new evidence to be adduced, such evidence to be either by oral examination in court, by affidavit or by disposition taken before an f examiner or commissioner as the court may direct. A party may by leave of the court allege any facts essential to the issue that have come to his knowledge after the decision of the court below and adduce evidence in g support of such allegations. 3. For additional evidence to be admitted on appeal:– 1. A special ground must exist and 2. The additional evidence to be relevant to the case, the h facts to be admitted as additional evidence must go to the issue in the case. The above conditions have been satisfied. Having regard to the claim of the plaintiff/respondent, the pleadings of i the parties and evidence before the court below in this case, regarding the equitable mortgage sought to be tendered as additional evidence, it is without doubt that the special circumstances exist including the error of j Counsel. The equitable mortgage definitely goes to some

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important issue in the case. They qualify the application a before us to be granted. The relevance of the deed of equitable mortgage is undoubtedly established and it goes to important issues in the case. b 4. Since there was the pleadings and evidence adduced even by the plaintiff of the fact that he executed a deed of equitable mortgage in 1984, it will be in furtherance of justice for the appellate court to avail itself of the c opportunity of seeing the contents of the said equitable mortgage in order to arrive at substantial justice. Special grounds exist to warrant this Court grant (sic) the application so that the appellant can adduce additional d evidence on appeal as a refusal to allow the appellant to adduce the additional evidence will be tantamount to visiting the sins of Counsel on the appellant. The deed of equitable mortgage will have an important effect on the e whole case and it will enable this Court to determine the appeal on the merits. Appeal allowed; cross-appeal dismissed. f Cases referred to in the judgment Nigerian A-G of the Federation v Alkali (1972) 12 SC 29 g Alao v Akanbi (1986) 5 NWLR (Part 46) 1043 Asaboro v Aruwaji (1974) 1 All NLR (Part 1) 140 Elike v Nwakwoala (1984) 12 SC 301 h Mosheshe General Merchants Ltd v Nigeria Steel Products Ltd (1987) 2 NWLR (Part 55) 110 Odiase v Omele (1985) 3 NWLR (Part 11) 82 i Okpanum v SGE (Nig) Ltd (1998) 7 NWLR (Part 559) 537 Okumagba v Esisi (2005) 4 NWLR (Part 916) 501 Orizu v Anyaegbunam (1978) 5 SC 21; (1978) 1 LRN 216 j

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First Bank of Nigeria Plc v Jibo 457 a Foreign Ladd v Marshall [1954] 3 All ER 745 Roe v R McGregor & Sons (1968) 1 WLR 925 b Nigerian rules of court referred to in the judgment Court of Appeal Rules, 2002, Order 1 rule 19(1), Order 1 c rule 19(2) Counsel For the appellant/applicant: Okafor (with him Adanini) d For the respondent: Ngavan

Judgment AKAAHS JCA: (Delivering the lead Ruling) This is an e application brought by the appellant seeking the following reliefs:– “1. An order granting leave to the appellant/applicant to give additional evidence on appeal by, tendering the equitable f mortgage dated 19/10/82 and registered as No. 247 at page 247 in Volume II Miscellaneous of the Lands Registry in the office at Makurdi, copy annexed hereto as exhibit 35A. 2. An order receiving the equitable mortgage exhibit 35A g hereto as additional evidence. 3. Leave to amend the appellants brief of argument”. The application is supported with an 8-paragraph affidavit to which was annexed the certified true copy of the equitable h mortgage attached as exhibit “35A”. A further affidavit of nine paragraphs still attaching the certified true copy of the equitable mortgage was deposed to by Bridget Ajah and a second further and better affidavit also containing nine i paragraphs to which was attached a copy of the receipt of payment for the amended appellant’s brief marked exhibit “36” was also deposed to by Bridget Ajah. The application was opposed by the respondent and a j counter-affidavit containing five paragraphs was deposed to

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Akaahs JCA 458 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) by John Hiinan, who is the litigation secretary in the law a office of S A Ngavan & Co. The grounds upon which the application is brought are:– 1. Two deeds of mortgage – one legal, the other b equitable mortgage were executed by the parties. 2. Only the legal mortgage was tendered as exhibit “35”. 3. The equitable mortgage which is earlier in time c though acknowledged by the respondent was not tendered in evidence. 4. The existence of this document was discovered only on 1 February, 2005. d 5. The former Counsel of the appellant was not aware of the existence of this document. 6. Both parties had acknowledged the existence of document in their pleadings. e Mr Okafor, SAN, in his oral submission argued that the respondent has not been taken by surprise. He submitted that the mistake in not tendering the document in the court below f should not be visited on the applicant and if allowed to stand, can only lead to technical justice and urged this Court to lean on the side of substantial justice by allowing the appellant (sic) adduce additional evidence and relied on Okumagba v Esisi (2005) 4 NWLR (Part 916) 501 at 512 – g 514. Mr Ngavan, learned Counsel for the respondent in opposing the application relied on the affidavit filed in h opposition and submitted that the grounds upon which the application has been brought are not tenable especially grounds four and five because the document was available but due to the misjudgment of Counsel, he did not tender it as evidence in the lower court. He submitted that i where mistake of Counsel amounts to incompetence or a misjudgment the litigant should not be excused and cited the following cases in support: Elike v Nwankwoala and others. (1984) 12 SC 301 at 310 – 312; Mosheshe General j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Akaahs JCA First Bank of Nigeria Plc v Jibo 459 a Merchants Ltd v Nigeria Steel Products Ltd (1987) 2 NWLR (Part 55) 110; (1987) 4 SCNJ 11 at 16 – 17; A-G of the Federation v Modu (1972) 12 SC 29 at 30 – 32. b He therefore urged this Court to dismiss the application. He however informed the Court that he was not opposing the application to amend the appellant’s brief. In paragraph 3 of the affidavit in support of the c application by Bridget Ajah on 22/2/05 she deposed to the following facts:– “3. That I am informed by G. Ofodile Okafor, Esq. (SAN) MCI Arb. counsel to the applicant on Monday 14/2/2005 in the d office at 1.50pm whom I verily believed as follows– (a) That evidence as to the existence of an equitable mortgage between the parties was led by the respondent at the trial court. e That the respondent at page 39 lines 23 to 24 of the record said– ‘These (sic) was an equitable mortgage deed in respect of the loan. It was executed in 1984’. f This statement is supported by paragraph 13(a) of the statement of claim and paragraph ii of the statement of defence. (b) That the equitable mortgage was found by G. Ofolile Okafor, Esq. (SAN) MCI Arb. on the 1/2/2005 while g searching for exhibits 35 to 41 which were not transmitted to the Court of Appeal. (c) That when he was briefed, he reviewed the entire case and is convinced that the deed of equitable mortgage h was an important document on the part of the appellant/applicant. (d) That the equitable mortgage dated 19/10/82 and executed by the applicant and respondent is annexed hereto as exhibit 35A. i (e) That exhibit 35A if received in evidence will have an important effect on the whole case as it will enable the court (sic) determine the appeal on its merit. (f) That exhibit 35A is not a new (sic) evidence and the j respondent will not be taken by surprise.

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(g) That the former counsel being not aware of the a existence of the equitable mortgage did not tender same by (sic) exhibit.” Mr John Hiinan deposed to the following facts in paragraph b 3 of the counter-affidavit dated 28/2/05:– “3. That I am informed by S. A. Ngavan, Esq., counsel to the respondent whom I verily believe that– (a) The document sought to be tendered was available at c the time of the trial of this suit as the appellant/applicant pleaded in paragraph 11 of the amended statement of defence that it would rely on the equitable and legal mortgage deed (sic). d (b) The appellant/applicant failed to tender the equitable mortgage deed now sought to be tendered. (c) The appellant/applicant did not complain at the trial that the document now sought to be tendered was not e available. (d) The trial court had no opportunity of seeing and evaluating the said equitable mortgage deed. (e) The document proposed to be tendered and marked as f exhibit 35A is new evidence as it was not placed before the trial court during the trial and therefore did not form part of the records in this appeal. (f) The respondent will be greatly prejudiced by the grant of this application as the appellant,’ applicant (sic) will g be assisted to patch-up her case. (g) . . .”.

The application to adduce further evidence has been brought h under Order 1 rule 19(1) of the Court of Appeal Rules, 2002 which provides for the general powers of the court. The rule states:– “In relation to an appeal the court shall have all the powers and i duties as to amendment and otherwise of the High Court including without prejudice to the generality of the foregoing words, in civil matters the powers of the High Court in civil matters to refer any question or issue of fact arising on the appeal for trial before, or inquiry and report by, an official or special referee. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Akaahs JCA First Bank of Nigeria Plc v Jibo 461 a In relation to a reference made to an official or special referee, anything which can be required or authorised to be done by, to or before the High Court shall be done by, to, or before the court.” b It appears to me that Order 1 rule 19(2) is more appropriate for the application and it provides as follows:– “The court shall have power to receive further evidence on c questions of fact, either by oral examination in court, by affidavit, or by deposition taken before an examiner or commissioner as the court may direct, but in the case of an appeal from a judgment after trial or hearing of any cause or matter on the merits, no such further evidence (other than evidence as to matters which have d occurred after the date of the trial or hearing) shall be admitted except on special grounds.” It is not in doubt that the equitable mortgage deed was in existence when the parties gave evidence. The plaintiff made e reference to it in paragraph 13(a) of the statement of claim wherein it was pleaded that:– “13. The plaintiff mortgaged his said property to the defendant and was debited with the sum of N150.00 on 14/12/84 being f consent to mortgage. The defendant also illegally debited the plaintiff’s account in the sum following– (a) N600.00 on the 20/12/85 being fees registration of conversion from equitable mortgage to legal mortgage.” g In paragraph 11 of the statement of defence, the equitable mortgage deed was pleaded. It was averred as follows:– “11. In further answer to paragraph 13 of the claim that defendant h will contend that all legal charges complained of by plaintiff were made in accordance with paragraph 1 (one) of the conditions and terms of the loan, specified inter-alia in the defendant’s letter to the plaintiff dated 14 May, 1981. The defendant will also rely in (sic) the equitable and legal i mortgage deed executed by the plaintiff in favour of the defendant. Notice is hereby given.” The document was therefore pleaded but through the inadvertence of Counsel, it was not tendered in the lower j court. In A-G of the Federation v Alkali (1972) 12 SC 29,

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Akaahs JCA 462 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) the Supreme Court presided over by Elias, CJN refused a a similar application when interpreting Order 7 rule 24 of the Supreme Court Rules which states that:– “It is not open as of right to any party to an appeal to adduce b new evidence in support of his original case; but, for the furtherance of justice, the court may, where it thinks fit, allow or require any new evidence to be adduced, such evidence to be either by oral examination in court, by affidavit or by deposition taken before an examiner or commissioner as the court may c direct. A party may by leave of the court allege any facts essential to the issue that have come to his knowledge after the decision of the court below and adduce evidence in support of such allegations.” d The reason given by the Supreme Court for refusing to grant the application to adduce additional evidence was because of the admission in paragraph 7 of the appellant’s affidavit in support of the application that it was due to appellant’s e witness’s inadvertence ie gross negligence, consisting in failure to tender the hire-purchase agreement which formed the basis of the appellant’s claim in the court below, in respect of which specific pleading was filed in the court of f trial. The court went further to say that it would have been otherwise if an application had been made to the court below for permission to tender the document on the ground, as suggested by Counsel, that because of the confusion attendant upon the political crisis in the country during the g relevant period, the document was not available for production until now. However in Asaboro v Aruwaji (1974) 1 (Part 1) All NLR h 140, the Supreme Court in a split decision of 2 to 1 considered a similar application and granted the appellant leave to adduce additional evidence on appeal. In the leading ruling of Coker, JSC at page 131 concurred in by Fatayi- Williams, JSC (as he then was) wherein he relied on i the observations made in Roe v R McGregor & Sons (1968) 1 WLR 925 where the earlier decision of the Court of Appeal in Ladd v Marshall [1954] 3 All ER 745 was considered and applied, he held that the discretion to grant j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Akaahs JCA First Bank of Nigeria Plc v Jibo 463 a leave to adduce new evidence is properly exercised for the “furtherance of justice”. The dissenting opinion of Ibekwe JSC (as he then was) was centred on the fact that the b applicant did not call evidence in the court below but only sought to do so in the appellate court and so felt strongly that since the applicant’s Counsel had chosen not to call any evidence but said he would rely on the plaintiff’s c case, the implication of it is that a defendant who prefers to rely on “the plaintiff’s case is in effect accepting both the favourable and adverse answers given by the plaintiff and his witnesses under cross-examination”. This court in Alao v Akanbi (1986) 5 NWLR (Part 46) 1043 applied the liberal d stance of the majority in Asaboro v Aruwaji (supra). In the lead judgment of Ogundere JCA (of blessed memory), he stated at page 1049 supra that: “New grounds were broken by the Supreme Court in Asaboro v Aruwaji & Anor. (1974) e 1 All NLR 140 at Pages 146 – 147 ” and after scrutinizing the ruling said further at page 1050:– “It would appear from the following case that the Supreme Court after all, in cases of nature, would no longer visit the sins of f commission and omission of others, including counsel for the parties, on helpless litigants. Thus in Ukpe Ibodo v Iguasi Onarofia (1980) 4 – 7 SC 42 at pages 52 – 53, which deal with ‘good and substantial reasons’ for appealing out of time, admittedly matter of procedure, may be prayed in aid of g applications like the one in hand. It was held– ‘this court has stated in several decisions that it is not right to visit the parties with punishment arising out of the mistakes or inadvertence or negligence of counsel and that in such a case the discretion of the h court, although always required to be exercised judicially’ (see– G.B.A. Akiyede v The Appraiser (1971) 1 All NLR 162 at p. 165; Doherty v Doherty (1964) 1 All NLR 299; Tunji Bowaje v Moses Adediwura (1976) 6 SC 143 at 147), should be exercised with a leaning towards accommodating the parties interests without i allowing mere procedural irregularities, brought about by counsel, to preclude the determination of the case on the merits (Ahmadu v Salawu (1974) 1 All NLR (Pt. 11) 318 – 324.” It is to be noted that the plaintiff in his evidence-in-chief j stated that the (sic) executed a deed of equitable mortgage in

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1984. This is what he said on page 39 lines 23 – 24 of the a records:– “There was an equitable mortgage deed in respect of the loan. It was executed in 1984”. b Since there was the pleadings and evidence adduced even by the plaintiff of the fact that he executed a deed of equitable mortgage in 1984, it will be in furtherance of justice for the appellate court to avail itself of the opportunity of seeing the c contents of the said equitable mortgage in order to arrive at substantial justice. Learned Counsel has satisfied me that special grounds exist to warrant this Court grant (sic) the application so that the appellant can adduce additional d evidence on appeal as a refusal to allow the appellant to adduce the additional evidence will be tantamount to visiting the sins of Counsel on the appellant. I agree with the deposition of the applicant that the deed of equitable e mortgage will have an important effect on the whole case and it will enable this Court to determine the appeal on the merit. Accordingly, I overrule the objection and the certified true copy of the deed of equitable mortgage dated 19/l0/82 f and executed by the applicant and respondent which is annexed to the affidavit in support of the motion is admitted in evidence as exhibit “35A”. g As learned Counsel announced that he was not opposing the application to amend the appellant’s brief, the order to amend the said brief is granted and the said appellant’s amended brief dated and filed on 18/4/2005 is deemed as properly filed and served today. h

NZEAKO JCA: In coming to the conclusion to grant appellant/applicant’s application herein, we have noted the for the differing views of the parties set out in their i affidavits oral submission, including the legal authorities cited before us at the hearing of the motion. These have been very carefully outlined by my learned brother Akaahs JCA in his leading ruling, and need not be repeated here. I would j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Nzeako JCA First Bank of Nigeria Plc v Jibo 465 a here affirm my agreement with him to grant the application, adding only a few words of mine. Without doubt, by virtue of Order 1 rule 19(2) of the b Court of Appeal Rules, 2002, the Court of Appeal has powers to receive further or additional evidence on appeal in certain circumstances. The Rule provides as follows:– c “The court shall have power to receive further evidence on questions of fact, either by oral examination in court by affidavit, or by deposition taken before an examiner or commissioner as the court may direct, but, in the case of an appeal from a judgment d after trial or hearing of any cause or matter on the merits, no such full evidence (other than evidence as to matters which have occurred after the date of the trial or hearing) shall be admitted except on special grounds.” e I am to point out that it is the latter arm of the rule which applies to this case, for the trial of the case on the merit had taken place. This rule has been applied by the courts, sometimes granting leave to an applicant to adduce further f evidence and at other times refusing to grant leave, based on their interpretation of the said rule and the circumstances of the particular case. The conditions are strict. That strictness notwithstanding, the appeal courts, while g applying the rule, often hold themselves bound to consider the ends of justice and act judiciously in determining whether to grant or refuse such application for leave to adduce further evidence on appeal. See Asaboro v Aruwaji h (1974) 4 SC 119 at 123 and 124. Another guiding principle is that the special facts and circumstances of each case must be considered, in addition to considering whether or not sufficient diligence has been i put into the application’s effort to secure the particular evidence for use during the trial in the court below. See Asaboro case (supra) at page 125, Coker JSC. These guiding principles are derived from the proviso j to the applicable rule – rule 19(2) (supra) wherein it is

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Nzeako JCA 466 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) provided that in the case of an appeal from a judgment after a trial or the hearing of a case on the merits, no further evidence shall be admitted, other than that matters which occurred after the date of the trial, shall be admitted “except b on special grounds”. In effect, if there are special grounds, the appeal court has powers to admit further evidence even as to matters which occurred or were in existence before the date of the trial. c I see some special grounds in this matter:– The deed of equitable mortgage which was undoubtedly in existence from the commencement of the action is relevant to the case of both parties. Each party pleaded d and/or referred to/relied hereon in his/its pleadings and evidence at the trial. See paragraph 13(a) and 13(b) of the plaintiff/respondent’s statement of claim and paragraph 11 of the defendant/applicant’s statement of defence. e It forms part of the respective cases of the parties. The plaintiff/ respondent relied on it. See paragraph 17 of his statement of claim, where he averred thus:– f “The plaintiff will at the hearing of this suit, use and rely on all correspondences and documents howsoever mentioned or referred to herein and they are hereby pleaded. The defendant is hereby given notice to produce the original of all correspondences and g documents referred to here in at the trial.” (Italics supplied.) The plaintiff/respondent did also mention the equitable mortgage in paragraph 13(a) and (b) of his pleadings. The plaintiff/respondent also testified in relation thereto in h his evidence in court – see page 39 lines 23 – 28 of the record of appeal. The said equitable mortgage, formed the basis of part of the respondent’s complaint against the defendant/appellant in paragraph 3 of his statement of claim i – a debit of N60,000 against him. I hold the firm view that the fact that the said equitable mortgage was pleaded and testified to by the parties is significant in determining whether it will serve the ends of j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Nzeako JCA First Bank of Nigeria Plc v Jibo 467 a justice for all parties in this matter to have it tendered in court. There is proof of its relevance to the case of both parties. Relevancy, under the law of evidence, governed by b the Evidence Act, is an important factor, in deciding whether to admit or reject evidence of a fact sought to be established. Section 6 of the Act provides that evidence may be given in any suit or proceedings of the existence or non-existence of c every fact in issue and proceedings of such other facts as are in the Act declared to be relevant. The matter of relevancy is mentioned here to underscore the judicial importance to both parties herein, of the piece of d evidence now sought to be adduced by the applicant, shown to be relevant to their respective cases before the court. This further justifies the need to adduce that evidence, in spite of the respondent’s opposition to it. e The defendant/applicant also relied on the said equitable mortgage but failed to tender it. Its reason for this failure is in advertence on the part of its Counsel. This, to my mind, qualifies also as a special ground under Order 1 rule 19(2) f (supra). It is well-settled that the inadvertence or negligence of Counsel should not be taken out on the litigant. Also, the need to determine a case on its merit is a compelling factor g in the exercise by a court of justice of its discretion. No party herein, is likely to suffer injustice or the breach of his right of fair hearing, and, it is not oral evidence that is h sought to be adduced in this case. It is documentary evidence which speaks for itself. As a matter of law, by virtue of section 13(1) of the Evidence Act, no evidence of the equitable mortgage may be i given in court except the production of the document itself, nor can its contents be contradicted by oral evidence, and an appeal court is in as good a position as a trial court to evaluate its effect on the matter before court, after hearing j Counsel for both parties.

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I would like to refer to the case of Okpanum v SGE a Nigeria Ltd decided by the Supreme Court and reported in (1998) NWLR (Part 559) 537 at 552 – 553. Although the apex court refused to uphold the decision based on b additional evidence adduced at Court of Appeal in that case, as it was entitled to do, the guiding principle, so succinctly set out in the judgment are relevant in this matter and I have held myself bound to apply them. In the case, the court referred to its decision in Asaboro v Aruwaji (supra) where a c similar application was granted. (See page 547 per Onu JSC). The court also referred to other cases wherein the same application was refused eg Odiase v Omele (1985) 3 NWLR (Part 82) etc. It set out the underlining (sic) d principles guiding the grant or refusal of the application to adduce further evidence: see the leading judgment of Onu JSC at pages 547 – 549. Concurring to the said leading judgment, Uwais, the e learned Chief Justice of Nigeria, pointed out that for additional evidence to be admitted on appeal:– 1. A special ground must exist; and f 2. The additional evidence to be relevant to the case, the facts to be admitted as additional evidence must go to the issue in the case. (See pages 552-553 of the report.) g The above conditions have been satisfied. Having regard to the claim of the plaintiff/respondent, the pleadings of the parties and evidence before the court below in this case, regarding the equitable mortgage sought to be tendered as additional evidence, it is without doubt that the special h circumstances exist, including the error of Counsel. The equitable mortgage definitely goes to some important issue in the case. They qualify the application before us to be granted. The relevance of the deed of equitable mortgage is i undoubtedly established and it goes to important issues in the case. Finally, I am to add that I have identified and taken into account in determining this application, some considerations j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, JOS DIVISION) Nzeako JCA First Bank of Nigeria Plc v Jibo 469 a taken into account by the appeal court which justify the restrictions applied in the exercise of its powers under rule 19(2) (supra). I will mention two of them:– b 1. That court sought to limit themselves to the matters put before them by the parties as stated in Orizu v Anyaegbunam (1978) 5 SC 21 also reported in (1978) 1 LRN 216 at 222. c 2. That granting such leave is against the principles that litigation must be brought to an end (not unnecessarily dragged or reopened). See Asaboro v Aruwaju (supra) at page 125. d Applied to this matter before us, I dare say that none of the foregoing will be breached by granting the application. For, as shown above, both parties had made the equitable mortgage part of their case in the court of trial and its e admission will not elongate the conclusion of the matter in any significant manner or cause injustice. For these and the more detailed reasons in the ruling of my learned brother Akaahs JCA, I too grant all the prayers in f the applicant’s application for leave to adduce additional evidence. I am in full agreement with the orders made in the judgment and the reasons thereof. g TSAMIYA JCA: I entirely agree with the ruling just delivered by my learned brother Akaahs JCA, a draft which 1 have had the privilege of reading. Application allowed.

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a Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd and another b COURT OF APPEAL, ENUGU DIVISION OGEBE, ROWLAND, BADA JJCA Date of Judgment: 27 MARCH, 2006 Suit No.: CA/E/83/2004

Banking – Foreign exchange – Approval slip – Significance c of

Facts The respondents/cross-appellants being the plaintiffs at the d lower court claimed by paragraph 37 of the further, further, further amended statement of claim jointly and severally against the appellant/cross-respondent being the defendant as follows:– e “The total sum of N11,113,663.10 a breakdown of which is shown hereunder– (a) The sum of £13.603.50 or N1,741,248.00 (Naira equivalent as at May 1995) being the value of the sum of £15,000,00 deposited with the defendant in December 1982, for f remittance to Bakaert International Trade, Belgium which it negligently refused or failed to do. (b) The sum of £34,161,056 or N4,372,615.10 (Naira equivalent as at May, 1995) being accumulated interest on the g deposited sum, from January, 1983 – May, 1995. (c) 2l% interest on the said sum of £34,161.05 or N4,372,615.10 from 1 June, 1995 until judgment (d) 5% interest on the judgment debt from the judgment date h until fully paid. (e) The sum of (N5,000,000.00) Five Million Naira being general damages for the loss of sole agency of Bakaert International Trade Belgium occasioned by negligence, refusal or failure of the defendant to remit the sum of i £15,000.00 for £13,603.50 deposited with it in 1982.” The plaintiff’s case was that in December 1982, the first plaintiff approached the defendant to remit the sum of £25,000 to its foreign beneficiary in Belgium ie Bakaert j

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Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 471 a International Trade Belgium (BITB) in settlement of the latter’s consultancy fees. The second plaintiff had obtained approval from the Federal Ministry of Finance and the first b plaintiff paid the aforesaid amount in two instalments of N15,000 and N10,000 in December, 1982 and January, 1983 respectively. The second installment reached its destination within one month, but the first instalment was not remitted c and the plaintiff’s action was for losses sustained as a result of the defendant’s alleged negligence. The defendant’s defence was that it acted as a conduit pipe for transmitting the first plaintiff’s application to the d Central Bank of Nigeria which at the time was vested with sole authority and power regarding foreign exchange transactions under the Exchange Control Act, 1962. The Central Bank of Nigeria CBN authorised the remittance of e the second instalment of N10,000 by general approval but never provided foreign exchange cover for the first instalment, of N15,000, which required Central Bank of Nigeria’s specific action. f The trial court inter alia held that the second plaintiff had no locus standi to sue and his name was struck out. N500,000 was awarded to the first plaintiff for loss of its sole agency. First plaintiff was non-suited for the said sum g of N15,000 with interest while the defendant’s defences relating to exemption clause and statute of limitation of actions were rejected. The defendant appealed against the judgment and the h plaintiffs cross-appealed.

Held – In this case, there is evidence at the lower court, which i evidence was not disputed, that the respondents/cross- appellants secured the foreign exchange approval slip from the Federal Ministry of Finance for the payment into the appellant’s bank for remittance to their foreign principal. j And since the approval slip is itself an allocation paper of

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472 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) foreign exchange that the appellant/cross-respondent ought a to have issued the respondents/cross-appellants with a draft drawn on their overseas correspondent bank. The approval of the Ministry of Finance for allocation of foreign exchange b is all that was needed. Appeal dismissed.

Cases referred to in the judgment c Nigerian Adesanya v The President of the Federal Republic of Nigeria (1981) 2 NCLR 358 d Adimora v Ajufo (1988) 3 NWLR (Part 80) 1 Agbanelo v Union Bank of Nigeria Ltd (2000) 7 NWLR (Part 666) 534 Armels Transport Ltd. v Transco (Nig) Ltd (1974) 11 SC e 237 Cheko v Kano Authority (1966) NMLR 378 Egbe v Adefarasin (1985) 1 NWLR (Part 3) 549 f Egonu v Egonu (1978) 11 – 12 SC 111 Ezeani v Ejidike (1964) 1 All NLR 402 Fasikun II v Oluronke II (1999) 2 NWLR (Part 581) 1 g Ijebu Ode Local Govt. v Adedeji Balogun and Co. Ltd. (1991) 1 NWLR (Part 166) 136 International Messengers (Nig) Ltd v Pego for Industries Ltd (2005) 15 NWLR (Part 947) 1 h Mazin Engineering Ltd v Tower Aluminum (1993) 5 NWLR (Part 295) 526 OAA Co-op Society v NACB Ltd (1999) 2 NWLR (Part 590) 234 i Odum v Chinwo (1978) 6 – 7 SC 251 Oyeyiola v Adeoti (1973) 1 NMLR 103 Savage v Uwaechia (1972) 1 All NLR 251 j

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Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 473 a Savannah Bank (Nig) Ltd v Pan Atlantic Shipping & Trans Agencies (1987) 1 NWLR (Part 49) 212 Thomas v Olufosoye (1986) 1 NWLR (Part 18) 669 b Foreign Schiffahrakontor GMBH v Railway Lines Ltd (1998) 4 KLR (Part 61) 769 c Tsakiroglon & Co Ltd v Noblee & Thorl GMBH [1961] 2 All ER 179 Nigerian statutes referred to in the judgment Actions Law (Cap 3) Laws of Anambra State (applicable in d Enugu State), section 20(1) Book referred to in the judgment Chitty on Contract Volume 1 (25ed) paragraphs 871 – 872 e Counsel For the appellant/cross-appellant: Mogbana For the respondent/cross appellant: Orabueze (Holden the f brief of Obegolu) Judgment BADA JCA: (Delivering the lead judgment) This is an g appeal against the judgment of High Court No. 1 sitting at Enugu Judicial Division of Enugu State, delivered on 12 March, 2003. In order to appreciate this appeal, it is necessary to refer h to the facts leading to the appeal. Briefly, the facts are that the respondents/cross-appellants being the plaintiffs at the lower court claimed by paragraph 37 of the further, further, further amended statement of claim jointly and severally against the appellant/cross-respondent being the defendant i as follows:– “The total sum of N11,113,663.10 a breakdown of which is shown hereunder– (a) The sum of £13,603.50 of N1,741,248.00 (Naira equivalent j as at May, 1995) being the value of the sum of N15,000,00

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deposited with the defendant in December, 1982, for a remittance to Bakaert International Trade, Belgium which it negligently refused or failed to do. (b) The sum of N34,161,056 or N4,372,615.10 (Naira equivalent b as at May, 1995) being accumulated interest on the deposited sum, from January, 1983 May, 1995. (c) 2l% interest on the said sum of £34,161.05 or N4,372,615.10 from 1 June, 1995 until judgment. c (d) 5% interest on the judgment debt from the judgment date until fully paid. (e) The sum of (N5,000,000.00) Five Million Naira being general damages for the loss of sole agency of Bakaert International Trade Belgium occasioned by negligence, d refusal or failure of the defendant to remit the sum of N15,000.00 for £13,603.50 deposited with it in 1982.” The plaintiff’s case is that in December, 1982, the first plaintiff approached the defendant to remit the sum of e N25,000 to its foreign beneficiary in Belgium ie Bakaert International Trade Belgium (BITB) in settlement of the latter’s consultancy fees. The second plaintiff had obtained approval from the Federal Ministry of Finance and the first f plaintiff paid the aforesaid amount in two instalments of N15,000 and N10,000 in December, 1982 and January, 1983 respectively. The second installment reached its destination within one month, but the first installment was not remitted g and the plaintiff’s action is for losses sustained as a result of the defendant’s alleged negligence. The defendant’s defence was that it acted as a conduit pipe for transmitting the first plaintiff’s application to the h Central Bank of Nigeria which at the time was vested with sole authority and power regarding foreign exchange transactions under the Exchange Control Act, 1962. The Central Bank of Nigeria (CBN) authorised the remittance of i the second instalment of N10,000 by general approval but never provided foreign exchange cover for the first instalment of N15,000, which required Central Bank of Nigeria’s specific action. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 475 a The trial court in inter alia held that the second plaintiff had no locus standi to sue and his name was struck out. N500,000 was awarded to the first plaintiff for loss of its b sole agency. First plaintiff was nonsuited for the said sum of N15,000 with interest while the defendant’s defences relating to exemption clause and statute of limitation of actions was rejected. c The defendant appealed against the judgment and the plaintiffs cross-appealed. Briefs were filed and exchanged. The appellant/cross-respondent formulated five issues for determination in this appeal as follows:– d 1. Did the trial Judge not fail to appreciate the provisions and operation of the Exchange Control Act, 1962 in relation to the transaction the subject matter of the suit? (Grounds 1 and 3). e 2. Was the trial court right in holding that the statute of limitation of actions and the exemption clause did not avail as defences to relieve the defendant of liability in the circumstances of the suit? (Grounds 2 and 5). f 3. Whether the trial Judge was correct in its opinion that the defendant was liable in negligence in handling the transaction. (Ground 4). g 4. Whether the court below was right in awarding general damages to the first plaintiff for the alleged loss of its sole agency, having regard to the pleadings and evidence before the court. h 5. Was the trial court wrong in entering a nonsuit with respect to the claim in paragraph 37(1)(a) of the statement of claim instead of dismissing the same. The respondents/cross-appellants also formulated five issues i for determination in this appeal as follows:– 1. Whether from the pleading and evidence in the suit, the plaintiff’s claim raised a suit for money had and received for a consideration that had wholly failed, j involving a refund thereof with an accrued interest

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rather than a claim for specific performance with a particular reference to prayer (1)(a) and reliefs in (b), (c) and (d) of paragraph 37 of the statement of claim. 2. Was the court right to hold that the plaintiff in this b suit did not ask for damages, having regard to the state of pleadings and evidence and the prayers in paragraph 37(1)(e) of the further, further, further amended statement of claim? Was the award of c N500,000 to the plaintiff adequate in the circumstances of this case? 3. Whether the court was right to nonsuit the plaintiff after finding that the defendant was negligent in the d transaction that gave rise to the cause of action in this matter. Was the address on nonsuit at the courts invitation not misconceived and wrong in law? 4. Whether the trial court was right to strike out the e second plaintiff as a party in the proceedings as lacking the standing to sue. 5. Was the trial court right to hold that the second f plaintiff signed an exemption clause as in exhibit “F” Requisition Form without any pleading or evidence in that regard. Does exemption clause, if at all operate in all circumstances including negligence? g At the hearing of this appeal, the learned Counsel of both parties adopted and relied on their respective briefs of argument. In determining this appeal, I think it will suffice to h consider the issues formulated in the appellant’s brief of argument since issues formulated in the cross-appellants’ brief of argument are related to that of the appellant with the exception of issue 4 in the cross appellant’s brief which i shall be taken separately. On issue 1 by appellant/cross-respondent, learned Counsel for the appellant submitted that the lower court misunderstood the import of paragraphs 5, 6 and 7 of the statement of j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 477 a defence and the testimonies of DW1 and DW2 on the procedure for remittance of money abroad. He went further in his submissions that the lower court failed to appreciate b the evidence of DW1 and DW2 and the provision of the Exchange Control Act that the only legitimate source of foreign currency available to commercial banks in 1982 and 1983 was the Central Bank and that only the latter could c control or approve remittance of funds abroad. On the other hand, Counsel for the respondents/cross- appellants in his reply submitted that the lower court was fully appreciative of the role of the Central Bank of Nigeria d and the provisions and operation of the Exchange Control Act, 1962 (now Cap. 113 Laws of the Federal Republic of Nigeria, 1990). In this case, there is evidence at the lower court which e evidence was not disputed, that the respondents/cross- appellants secured the Foreign Exchange Approval Slip from the Federal Ministry of Finance for the payment into the appellant’s bank for remittance to their foreign principal. f And since the approval slip is itself an allocation paper of foreign exchange, it is my view that the appellant/cross respondent ought to have issued the respondents/cross- appellants with a draft drawn on their overseas corres- g pondent bank. The approval of the Ministry of Finance for allocation of foreign exchange is all that was needed. There is no evidence on the record at the lower court that the nation was in short of foreign reserves to meet the h respondents/cross-appellant’s order. Also, the money paid to the appellant/cross-respondent for the transaction was not returned to the respondents/cross-appellants. In view of the foregoing, I resolve issue 1 in favour of the i respondents/cross-appellants that the lower court appreciated the provisions and operation of the Exchange Control Act, 1962, in relation to the transaction which is the subject matter in this suit hence this Court found the appellant/cross- j respondent negligent.

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On issue 2 which deals with limitation of actions and a exemption clause. It was submitted on behalf of the appellant/cross- respondent that the lower court overlooked or failed to b understand the import of the averment in paragraphs 25 and 26 of the statement of defence where the defendant pleaded legal defences. It was argued further that the plaintiff’s action was mainly in negligence. By virtue of section 20(1) c of the Actions Law (Cap. 3) Laws of Anambra State applicable in Enugu State, such action should not be entertained by the court after the expiration of six years front (sic) the date on which the cause of action accrued. d Reference was made to the testimony of PW1 – 01/2/2000 and 9/11/2000 that as far back as 1985 when he discovers the negligence and incompetence on part (sic) of the defendant in handling the N15,000 remittance, he decided to use IBWA in transferring N64,158.02 to Belgium, which e went through. Learned Counsel for the appellant/cross-respondent contended that the plaintiff’s action in negligence accrued in 1985 but not later than 1987 when the Central Bank advised f the plaintiff in exhibit “C”, that the application for refinancing had been rejected as unmatched. He referred to the following cases: Schiffahrakontor GMBH v Railway Lines Ltd (1998) 4 KLR (Part 61) at 769 at 781 – 2; Savage g v Uwechia (1972) All NLR 251 at 261 pet Fatai-Williams JSC; Egbe v Adefarasin and another (1985) 1 NSCC 643 at 658 – 659, per Karibi-Whyte JSC (1985) 1 NWLR (Part 3) 549. h Learned Counsel submitted that the effect of section 20 of the Actions Law is that this action brought in 1995 became totally barred by the statute as from 1993 in respect of their claim as regards the handling of the transaction or in i contract for recovery of the deposit of N15,000. He urged that the two claims should be dismissed. On his part, learned Counsel for the respondents/cross- appellants contended that the transactions between the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 479 a respondents and the appellant did not terminate in 1987. Reference was made to the letters of 30/11/87, 6/11/88, 7/1/94 and 21/12/94 which were all pleaded and also b exhibits D, D1, D3, D4, D5, E, E2, E3 and E4. Reference was also made to the meetings between the respondents and the appellant at the appellant’s zonal office on 31/8/1995 and 21/9/1995. c The appellant/cross-respondent in paragraph 23 of the statement of defence admitted the meetings referred to above. See pages 166 – 167 of the record. It was submitted further on behalf of the respondents/ d cross-appellants that the lower court was in order when it held that the matter was not barred by statute of limitation. In Savannah Bank (Nig) Ltd v Pan Atlantic Shipping & Trans Agencies Ltd and another (1987) 1 NSCC 67 at 70; e (1987) 1 NWLR (Part 49) 212, it was held that:– “A limitation does not act in vacuo. It is the defendant who ought to plead and prove that the claim is statute barred. This will lead in a consideration of the facts or combination of the facts which gave f the plaintiff the right to sue . . . Time will start to run when the cause of action arose. It is therefore absolutely necessary when dealing with limitation statutes, to determine the precise date upon which the cause of action arose. Without this basic facts, (sic) it will be impossible to compute the time.” g Also in Adimora v Ajufo (1988) 1 NSCC 1005 at 1008; (1988) 3 NWLR (Part 80) 1 at 17:– “Cause of action was defined to consist of every fact which it would be necessary for the plaintiff to prove, if traversed, in order h to support his right to judgment – Cooke v Gill (1873) L.R.8 C.P. Page 107– Read v Brown (1888) 22 Q.B.D. Page 128. When these facts have occurred and provided there are in existence a competent plaintiff and a competent defendant, a cause of action is said to accrue to the plaintiff because he can then prosecute an i action effectively. Thus the action of a cause of action is the event whereby a cause of action becomes complete so that the aggrieved party can begin and maintain his cause of action.” In the instant case, after 1987 when the Central Bank j advised the plaintiffs in exhibit “C” that the application for

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA 480 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) refinancing had been rejected as unmatched (sic). Further a correspondence between the parties continued as could be seen by letters of 30/11/87, 6/11/88, 7/1/94 and 21/12/94 which were all pleaded and also exhibits D, D1, D3, D4, D5, b E, E2, E3 and E4. Reference was also made to the meetings between the respondents/cross-appellants and the appellant/cross- respondent at the appellant’s zonal office on 31/8/95 and c 21/9/95. Paragraph 23 of the statement of defence admitted the meetings referred to above. Consequently, it is my view that respondents/cross- appellants’ case was not statute-barred when the action ‘ as d (sic) instituted in 1995 because the cause of action became complete in 1995. And in accordance with section 20(1) of the Actions Law (Cap. 3) Laws of Anambra State applicable in Enugu State, the six years allowed was with effect from e 1995. Concerning the exemption clause, it was submitted on behalf of the appellant/cross-respondent that the lower court misconstrued or failed to appreciate the import of the f exemption clause. It was contended that the exemption clause as couched in this case excluded all liability, even for negligent execution of contract. Counsel referred to Chitty on Contract, Volume 1 (25ed), paragraphs 871 – 872. g On his own part learned Counsel for the respondents/ cross-appellants relied on International Messengers (Nig) Ltd v Pegofor Industries Ltd (2005) 5 SCNJ 120; (2005) 15 h NWLR (Part 947) 1, which held that exemption clause does not avail a party in breach of contract to escape liability. Reference was made to section 190 of the Contract Law Cap 32 Revised Laws of Anambra State, 1991 which states as follows:– i “Nothing in the foregoing shall be construed as to enable a party guilty of fundamental breach of a contract, or a breach of a fundamental term to rely upon an exemption clause so as to escape liability.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 481 a Therefore, as could be seen from above, the exemption clause as couched in this case cannot exclude liability for negligent execution of a contract. b On frustration of contract, it was also contended on behalf of the appellant/cross-respondent that execution of the transaction could be said to have been frustrated by failure of the Central Bank to intervene positively as predicated in c the exemption clause. Counsel referred to: Mazin Engineering Ltd v Tower Aluminium (1993) 6 SCNJ (Part 11) 176; (1993) 5 NWLR (Part 295) 526 and Tsakiroglou & Co Ltd v Noblee & Thorl GMBH [1961] 2 All ER 179. d Counsel for the respondents/cross-appellants submitted that the appellant was in a grave misapprehension of the role of the Central Bank in the transaction and the effect of the approval slip by the Minister of Finance given to the e respondent for the sum of N15,000. He went further in his argument that the issuance of the said foreign exchange approval slip simply means that the foreign exchange had been allocated and set aside to cover the said sum of f N15,000 for the transaction and for the benefit of the applicant transferor or to settle the overseas beneficiary. In Mazin v Tower Aluminium (supra) frustration was defined: g “as the premature determination of an agreement between parties lawfully entered into and in course of operation at the time of its premature determination, owing to the occurrence of an intervening event or change of circumstance so fundamental as to be regarded by law both as striking at the root of the agreement, h and as entirely beyond what was contemplated by the parties when they entered into the agreement.” In this case, there is evidence before the lower court that even though the plaintiffs paid for the first tranche in i December, 1982, the defendant did not follow up with the Central Bank until 1985 in exhibit “B3” and “B4”. (See pages 173 – 175 of the record.) In exhibit “B4” the defendant head office directed j the Garden Avenue, Enugu to enter the remittance for

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA 482 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) refinancing, but it turned out that the refinancing was a exclusively for tangible trade. The application for refinancing was refused with the notation “unmatched” in 1987. b I agree with the submission of Counsel for the respondents/ cross-appellants that the refusal of the application for refinancing in 1987 was not based on lack of foreign exchange but based on the issue of not matching, therefore c in my own view there is no frustration of contract in this transaction. On issue 3, learned Counsel for the appellant/cross- respondent submitted that the court below did not d understand the evidence of DW1 and DW2 when it held the defendant liable in negligence. He went further in his argument that the defendant was not more than a conduit pipe and not an agent who buys foreign currency from the e Central Bank for resale to its customers and therefore not negligent. Learned Counsel for the respondents/cross-appellants contended that the appellant was negligent and that it heaped f the blame on the Central Bank for its inability to perform. In this case, it would be necessary to subject the conduct of the defendant to legal test for negligence in view of the g contention by the defendant that it was not negligent. The essentials of actionable negligence are (1) the existence of the duty of care, (2) breach of that duty and (3) damages suffered as a result of the breach. h The plaintiffs’ case is that in December, 1982 they approached the defendant to purchase the pound sterling equivalent of N25,000 to be remitted to Bakaert Inte- rnational Trade, Belgium. Plaintiffs obtained the requisite i approval from the Minister of Finance and paid the defendant for the foreign currency in two installments of N15,000 and N10,000. They also paid the defendant’s charges. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 483 a The defendant remitted the equivalent of N10,000 which was the second installment but failed to remit the equivalent of N15,000 up to the time the action was filed. b The defendant denied being negligent in handling the transaction. It claimed to be only a conduit pipe and that all foreign exchange transactions at that point in time were vested in the Central Bank of Nigeria. c The moment the plaintiff paid the N15,000 to the defendant for the purchase of foreign currency and the defendant collected its own charges, a duty of care had been established. The defendant ought to have foreseen that if d care was not taken, the plaintiffs would be injured. And breach of the duty would result in damages. In my view, the learned trial Judge’s finding on the issue e on the evidence before her that:– “There is also evidence before me that even though the plaintiff paid for the 1st tranche in December, 1982, the defendant did not follow up with the Central Bank until 1985 in exhibits “B3” and “B4”. And to top this fact is the admission by DW1 that by 1993 f the defendant was yet to return to the plaintiff’s account the N15,000.00 purchase sum it received for the sterling it could not source. The defendant placed no cogent reason for its failure to procure the foreign currency paid for . . . g The defendant’s approach to the contract was at best lackadaisical and I agree with the plaintiff that the defendant is negligent.” cannot be faulted because the defendant had not shown to the satisfaction of the court that they were not negligent, h therefore the decision of the trial Judge on the issue ought not to be disturbed. On issue No. 4, it was contended on behalf of the appellant/ cross-respondent that the lower court had no basis i for holding that the plaintiff was entitled to N500,000 as general damages for the loss of its sole agency of Bakaert International Trade Belgium for failure by the defendant to remit the sum of £13,603.50 or N1,741,248.00 (Naira j equivalent as at May, 1995) to the said beneficiary.

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Reference was made to the statement of claim, the a particulars of loss and particulars of special damage. Learned Counsel for the appellant submitted that the materials before the lower court whether in the pleadings or b the evidence led in court were not enough to establish the existence of any agency or support the award of N500,000 damages to the first plaintiff for the loss of the said sole agency of BITB. c On the other hand, learned Counsel for the respondents/ cross-appellants submitted that the sum awarded as general damages is most inadequate considering what the plaintiff suffered and lost as a result of the action of the defendant. d He referred to the losses enumerated by the plaintiff. He submitted further that even though damages are not easy to quantify and ascertain, the sum claimed by the plaintiff in the circumstances should be upheld by this court as against e the paltry sum of N500,000 awarded by the trial court. He referred to the following cases: Ijebu Ode Local Government v Adedeji Balogun and Co Ltd (1991) 1 NWLR (Part 166) 136; Agbanelo v Union Bank of Nigeria (2000) 4 SCNJ 353 at 369; (2000) 7 NWLR (Part 666) 534. f In order to appreciate what the plaintiffs suffered, I have to refer to the evidence of the second plaintiff at the lower court which is contrary to the contention of the appellant g that the evidence led in court were (sic) not enough to support the award of N500,000 damages to the plaintiff. At pages 181 – 182 of the record, the second plaintiff stated thus:– h “I have suffered tremendous damage. I lost the very business for which this money was meant. I lost my agency because of this business. I lost my credibility with the European companies. I lost the foreign exchange approved for me by the Federal government in the sum of Thirteen Thousand, Six Hundred and Three Pounds i Sterling. I lost the approval from the Federal Ministry of Finance itself and the relevant remittance documents deposited with the bank. I also lost the bank cheque of N38.60 which I paid them then. I am also owing Mr. Schwere the sum of £13,306. The interest ever since then and the bank charges. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 485 a I am also asking for N5 million general damages. I need to go overseas to repair the damage caused me there by this transaction. We are asking ever since we came to court for an interest of 21% on the sum of £13,306 till judgment.” b In Ijebu-Ode Local Government v Adedeji Balogun & Co. Ltd (supra) general damages was defined as such as the law will presume to be the direct natural or probable c consequence of the act complained of or damages resulting from the loss flowing naturally from the breach of contract and is incurred in due consequence of the breach. General damages is not the same as special damages d where one has to itemise and prove all issues being claimed. But whether general or special damages, it must be noted that double compensation should be avoided. e I am fortified in my view above by the observation of Brett JSC in Ezeani v Ejidike (1964) 1 All NLR 402 at 405 referred to in Armels Transport Ltd v Transco (Nig) Ltd (1974) NSCC 582 at 585 thus:– f “Where as has happened here, a plaintiff asking for damages begins by setting out specific items of damages and then adds a claim under the heading of general damages for the sum which will bring the total claimed to a round figure, his claim should always be carefully scrutinized both by the defendant and by the g court in order to see whether he is in fact asking to receive compensation more than once for the same cause of action. An instance of this occurred in Onaga & Others v Micho & Co. (1961) All NLR Page 324, where this court held that having awarded damages for his actual loss under various specific h headings a plaintiff in an action for breach of contract could not receive any further award under the heading of general damages. The measure of damages in an action in tort is not the same as in an action in contract, but the rule against double compensation i remains the same.” After considering the evidence of the plaintiff placed before the trial court, it is clear that the plaintiff suffered damages as a result of the negligent approach of the defendant to j the transaction under consideration. As for the award of

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N500,000 made to the plaintiff, I will comment on it later in a this judgment. It is appropriate to consider now, issue No. 4 in the cross- appellants’ brief of argument which is whether the trial court b was right to strike out the second plaintiff as a party in proceedings as lacking the standing to sue. Learned Counsel for the appellant/cross-respondent c contended that the first plaintiff lacks locus standi to bring this suit because the Federal Ministry of Finance approval was granted in favour of ACE Chukwu. The first plaintiff not being the owner or beneficiary of the approval is not entitled to claim the reliefs in paragraphs 35 to 37 of the d statement of claim. He referred to Adesanya v The President of the Federal Republic of Nigeria (1981) 1 All NLR 1 to 26; (1981) 2 NCLR 358. e He also submitted that the second plaintiff lacks locus standi to sue the defendant because:– • the second plaintiff was not the defendant’s customer for the purpose of remittance of the funds (N15,000) the f subject matter of this action. • the plaintiff never paid the said amount to the defendant for remittance; and g • the Federal Ministry of Finance approval was presented to the defendant by the first plaintiff and not the second plaintiff. • the sole agency alleged to have been lost was that as the h first plaintiff. Learned Counsel also contended that there is no nexus between the second plaintiff and the defendant to warrant invocation of the powers of the court for the determination i of any question as to the civil rights and obligations of the second plaintiff. He referred to Thomas v Olufosoye (1986) 1 NWLR (Part 18) 669. He finally urged that the action must fail for want of locus standi by the plaintiffs. j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 487 a On the other hand, learned Counsel for the respondents/ cross-appellants contended that the second plaintiff did not lack the standing to sue in view of the evidence before the b court of the interest of the second plaintiff. He referred to the evidence of interest of the plaintiffs in this case as follows:– • the foreign exchange approval slip was issued in the name c of the second plaintiff ie exhibit “A”. • to pay for the transaction the second plaintiff used his personal cheque to pay the defendant the sum of N15,000 (£13,603.50) to be remitted to the foreign principal in d Belgium. See exhibit “BB”. Learned Counsel stated that the first and second plaintiffs had joint interest in the transaction with the defendant. e The question whether or not a claimant has sufficient justiciable interest depends on the facts and circumstances of each case. A person who is desirous of invoking the judicial power f of the court must show that either his personal interest will immediately be or has been adversely affected by the action or that he has sustained or is in immediate danger of sustaining an injury to himself, and which interest or injury g is over and above that of the general public. See Adesanya v The President of the Federal Republic of Nigeria (supra). In the instant case, the foreign exchange approval slip was issued in the name of the second plaintiff ie exhibit “A”. h And to pay for the transaction the second plaintiff used his personal cheque to pay the defendant the sum of N15,000 ie (£13,603.50) to be remitted to the foreign principal in Belgium. Exhibit “BB” on page 119 of the record showed i that the first and second plaintiffs had joint interest in the transaction. Furthermore, in order to show the joint interest, paragraph 2 of the further, further, further amended statement of j claim which states that “The 2nd plaintiff is the Chairman/

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Managing Director of the first plaintiff’ was admitted by a paragraph 2 of the further, further, further, further amended statement of defence. See pages 150 and 160 of the record. In the circumstance, it is my view that both the first and b second plaintiffs have joint interests to protect and it could not be said that they lacked the standing to sue.

Finally, coming back to issue No. 5, learned Counsel for c the appellant/cross-respondent submitted that the present order of nonsuit was not informed by unsatisfactory evidence or failure by the plaintiffs to prove their case but because the prayer for specific performances sought cannot d avail the plaintiffs. He went further that an order of nonsuit should not be made where the plaintiffs have failed to establish the case put forward in their pleadings, the proper order to be made in such a situation is outright dismissal of the case. He referred to the following cases: Egonu v Egonu e (1978) 11 – 12 SC page 111 or (1978) NSCC page 575; Odum v Chinwo (1978) 6 – 7 SC page 251 or (1978) NSCC page 438; Oyeyiola v Adeoti (1973) 1 NMLR page 103; Fasikun II v Oluronke II (1999) 2 NWLR (Part 589) 1; OAA f Co-op Society v NACB Ltd (1999) 2 NWLR (Part 590) 234. The learned Counsel for the respondents/cross-appellants submitted that the principle of a nonsuit is that once an order g of nonsuit is made in respect of a suit, that suit ceases to exist but the right of action continues. He referred to Mayaya Cheko v Kano Authority (1966) NMLR 378. In this case, the lower court held that the defendant was h negligent in not remitting the money paid to it by the plaintiff in 1982 and up to 1995 when this suit was initiated and even till date, holding back the money and all the documents lodged with the defendant by the plaintiff for the i said remittance. The lower court non-suited the plaintiffs on the prayer in paragraph 37(1)(a), (b) and (c) of the further, further, further amended statement of claim and gave judgment on the j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 489 a prayer in paragraph 37(1)(e) in favour of the respondents/ cross-appellants. In my view, it is irregular to give judgment to the plaintiff b in damages based on a non-suited matter as in this case. The lower court ought to have examined the claim critically. Since the defendant was found negligent for not remitting the money paid to it in 1982 and the defendant still held on c to the money, therefore considering the pleadings and the evidence of the parties, judgment ought to have been given in favour of the plaintiff since the basis of the negligence was the money deposited with the defendant for remittance d which defendant refused or failed to remit. The prayer in paragraph 37(1)(a) is to have the money back and prayers in (b) and (c) are ancillary to the prayer in paragraph 37(1)(a). e The prayer in paragraph 37(1)(a) did not insist on the remittance as the defendant contracted to do, therefore, the issue of specific performance does not arise. The lower court was therefore wrong in that regard. f In the final analysis, it is my view that this appeal is unmeritorious. It fails and it is accordingly dismissed. The cross-appeal succeeds and it is allowed. The judgment of the lower court dated 12 March, 2003 which struck out the name g of the second plaintiff and non-suited the plaintiff’s claim in paragraphs 37(1)(a), (b) and (c) of the further, further, further amended statement of claim is hereby set aside. In its place judgment is hereby entered in favour of the respondents/ h cross-appellants against the appellant/cross-respondent in the sum of £13,603.50 or N1,741,248 (Naira equivalent as at 1995) being the value of the sum of N15,000 deposited with the defendant in December, 1982 for remittance to Bakaert i International Trade Belgium which it negligently refused or failed to do. The reliefs sought in prayers 37(1)(b) and 37(1)(c) ie the prayer for £34,161,056 being accumulated interest and 21% j interest on the said sum from 1995 until judgment, being

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Bada JCA 490 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) ancillary and tied to the prayer 37(1)(a) are hereby refused a because interest should be awarded to the plaintiffs not as compensation for the damage done but for being kept out of money which ought to have been paid to them. The b respondents/cross-appellants are only entitled to interest on the said sum of £13,603.50 or N1,741,248 being the value of the said N15,000 deposited with the defendant for remittance. c On prayer 37(1)(d),the respondents/cross-appellants are entitled to 5% interest on the judgment debt beginning from 12/3/2003 when the lower court delivered its judgment until the said judgment debt is finally liquidated. d On prayer 37(1)(e), in view of my finding earlier in this judgment that the plaintiffs suffered damages as a result of the negligent approach of the defendant to the transaction, they are entitled to damages but in view of the fact that the e plaintiff’s claim succeeded on paragraph 37(1)(a) and in order to avoid double compensation I will refrain from confirming the award of N500,000 general damages by the lower court. f This shall be the judgment of the court. The respondents/ cross-appellants are entitled to costs of this appeal which is assessed as N10,000 (Ten Thousand Naira) against the appellant/cross-respondent. g

OGEBE JCA: I read before now the lead judgment of my learned brother, Bada JCA just delivered and I agree entirely with his reasoning and conclusion. h He has painstakingly resolved all the issues raised in the appeal and I have nothing useful to add. I also dismiss the appeal and allow the cross-appeal. I endorse all the consequential orders made in the lead judgment including i the order on costs.

ROWLAND JCA: I have had the benefit of reading in draft, the lead judgment of my learned brother Bada JCA just j

[2004 – 2006] 13 N.B.L.R. (PART II) (COURT OF APPEAL, ENUGU DIVISION) Rowland JCA Union Bank of Nigeria Plc v Omniproducts (Nigeria) Ltd 491 a delivered. I agree with his reasoning and conclusion that the appeal lacks merit and should be dismissed. His Lordship has adequately dealt with all the issues b submitted to this Court for the determination of this appeal and I therefore have nothing useful to add. I accordingly find this appeal lacking in merit and I dismiss it. I abide by the consequential orders in the lead judgment including the c order on costs. Appeal dismissed.

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a National Universities Commission v Societe Generale Bank (Nigeria) Ltd (No.2) b FEDERAL HIGH COURT OF NIGERIA, ABUJA DIVISION CHIKERE J Date of Judgment: 4 APRIL, 2006 Suit No.: FHC/ABJ/M/293/05

Garnishee – Order absolute – When not to be made c

Facts The applicant obtained judgment against the defendant, a banking outfit which could not satisfy the judgment debt. d The applicant therefore applied to garnishee the funds of the bank supposed to be with the Central Bank of Nigeria, but the latter averred that the judgment debtor had no funds e with it, instead the bank was owing the Central Bank. The Central Bank therefore submitted that the order nisi should not be made absolute. f Held – 1. Garnishee proceedings are another method by which a judgment for payment of debt may be enforced. It is not every debt that is attachable. The debt must be a present g and existing one. 2. No order absolute will be made where there is doubt as to whether or not the debt attached belongs to judgment debtor. h Refusing the order absolute.

Case referred to in the judgment i Nigerian Banque Del’ Afrique Occidentale v Habu, Iliasu and Savage, in re Northern Nigeria Marketing Board (1964) NNLR 30 j

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National Universities Commission v Societe Generale Bank 493 (Nigeria) Ltd a Barclays Bank DCO v Baderinwa in Re LEDB (1962) 2 All NLR 28 b Central Bank of Nigeria v Adedeji and others (2004) 13 NWLR (Part 890) 226 FMBN Ltd v Desire Gallery Ltd (2004) 13 NWLR (Part 891) 522 c NDIC v Akahall Ltd (2003) 31 WRN 125 Odoho v Task Force Hospital Management (2004) 5 NWLR (Part 867) 627 d Onjewu v Kogi State Ministry of Commerce and Industry and others (2003) 10 NWLR (Part 827) 40 Onwukeme v Onwukeme (1971) NNLR 10 Savannah Bank of Nigeria Plc v Nigeria Deposit Insurance e Corporation and others (2004) 11 NWLR (Part 883) 60 STB Ltd v Contract Resources Ltd (No. 1) (2001) FWLR (Part 72) 1992 f UBN Plc v Bonny Marcus Industry Ltd (2005) 13 NWLR (Part 943) 654

Nigerian statutes referred to in the judgment g Banks and Other Financial Institutions Decree No. 25 of 1991, sections 12, 15, 15(6)(b), 16 Companies and Allied Matters Act Cap 59 Laws of the Federation of Nigeria, 1990, sections 417, 454 h Evidence Act Cap 112 Laws of the Federation of Nigeria, 1990, section 149(d) Sheriff and Civil Process Act Cap S6 Laws of the Federation i of Nigeria, 2004, section 84

Judgment CHIKERE J: By an application dated 6/5/06 this Court j ordered the judgment debtor to show cause why an Order

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J 494 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) absolute should not be granted and adjourned case to 1/3/06 a for order to show cause. On 8/5/06 parties were ordered to file written arguments. The written argument of the plaintiff/judgment creditor as b furnished by FM Femi, Esq. of Counsel is dated 12/5/06 but filed on 15/5/06 and reply on points of law dated 26/5/06 but filed on 30/5/06. c The reply address as furnished by defendant’s Counsel is dated 3/7/06 but filed on 5/7/06. The garnishee reply is dated 22/5/06 but filed on 23/5/06. The application for garnishee order is supported by a 15- d paragraph affidavit and a further affidavit of eight paragraphs, all sworn to by one Moses Awe and two documents annexed as Exhibits “1” and “2” respectively. The garnishee filed a 7-paragraph affidavit showing cause, e dated and filed on 10/3/06. Arguing plaintiff/judgment creditor Counsel submits that by the affidavit showing cause the following facts are discernible: f (1) That the bank license of the judgment debtor had been revoked by the garnishee since 16/10/2006. (2) That at the time of the revocation of the license of the g judgment debtor, its account was in debt to the tune of N18,347,522,076.93. Arguing the issue of the revocation of the licence of the judgment debtor, he submits that the revocation of the h banking license of the judgment debtor by the garnishee under section 12 of the Banks and Other Financial Institutions Decree No. 25 of 1991, merely precludes it from conducting banking business and cites SBN Plc v NDIC i (2004) 11 NWLR (Part 883) 60 at 64 ratio 2. He further submit (sic) that the revocation of the judgment debtor’s banking licence does not stop it from paying its debts nor does it terminate its existence in fact and in law. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities Commission v Societe Generale Bank 495 (Nigeria) Ltd a That the judgment debtor being a body duly registered under the Companies and Allied Matters Act will only cease to exist upon the making of a dissolution order under section b 454 of the Companies and Allied Matters Act Cap 59 Laws of the Federation of Nigeria, 1990. He cites NDIC v Akahall Ltd (2003) 31 WRN 125 at 134 – 135 ratio 13. That, it is not the contention of the garnishee that such order has been c made and in fact no such order has been made. Counsel refers the Court to paragraph 5 of the further affidavit and submits that no winding-up order has been made nor has a provisional liquidator being appointed for d the judgment debtor by the order of a competent court under section 417 CAMA to inhibit the application of the judgment creditor for the grant of a garnishee order absolute. e On the second issue, that the account of the judgment debtor with the garnishee is in debit, he refers to Exhibit “B” of the garnishee’s affidavit and submits that it is too scanty to represent a statement of account of the judgment debtor. f That there is no record of an opening balance. That the account opened with a deficit of over N18 billion and also closed with same deficit. There is no record as to how the deficit came about. g He also refers to paragraphs 9, 10, 11, 12 and 13 of the affidavit in support of plaintiff/judgment creditor’s motion dated 6/02/2006 and section 15 and 16 of the BOFID, 1991 and submits that the judgment debtor is mandated to h maintain cash reserves, special deposit, specified liquid assets, stabilization securities with the garnishee. That under section 15(6)(b) the specified liquid assets, includes treasury bills and treasury certificates issued by the Federal i Government; that all these monetary instruments translates into cash. He posits that the statutory reserves and treasury bill of the judgment debtor in the custody of the garnishee to the j tune of N600 billion as contained in paragraph 9 of

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J 496 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) plaintiff’s affidavit and Exhibit “2”, is unaccounted for in a the judgment debtor’s alleged statement of account, ie the Exhibit “B”. He submits that the failure of the garnishee to account for b the statutory reserves and treasury bills of the judgment debtor in its custody (its Exhibit “B”) is an indication that if it gives account of it, it will not be in its favour, and cites 149(d) Evidence Act Cap 112 Laws of the Federation of c Nigeria, 1990 (sic) case of Odoho v Task Force Hospital Management (2004) 5 NWLR (Part 867) 627 at 631- 632 ratio 3. d He submits that the garnishee has failed to show sufficient reason or cause by its affidavit, which is merely a ruse made to deny the judgment creditor the fruit of its judgment, and therefore urged the honourable Court to exercise its e discretion in plaintiff favour by making the order nisi, absolute while citing case of UBN Plc v Bonny Marcus Industry Ltd (2005) 13 NWLR (Part 943) 654 at 656 ratio 2, FMBN Ltd v Desire Gallery Ltd (2004) 13 NWLR (Part 891) 522 at 528 ratio 7. f S S Gezawa, Esq. of Counsel to the defendant/judgment debtor in his reply states that the judgment debtor aligns itself with all the submissions of the learned Counsel to the g garnishee in its written address dated 22 May, 2006 reply to address of judgment creditor/garnishee, especially the provision of section 84 of the Sheriff and Civil Process Act Cap S6 Laws of the Federation of Nigeria, 2004 provides as h follows; “Where money liable to be attached by Garnishee proceedings is in the custody or under the control of a public officer in his official capacity or in custodia legis, the Order Nisi shall not be made i under the provision of the last proceeding section unless consent to such attachment is first obtained from the appropriate officer in the case (sic) money in the custody or control of a public officer or of the Court in the case of money in custodia legis, as the case may be.” j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities Commission v Societe Generale Bank 497 (Nigeria) Ltd a That in such cases, the order of notice must be served on such public officer or on the Registrar of the Court, as the case may be. b In this section, appropriate officer means:– “a. In relation to money which is in custody of a public officer who holds a public office in the public service of the Federation, the Attorney General of the Federation. c b. In relation to money which is in the custody of public officer who holds a public office in the public service of the State, the Attorney General of the State.” d Counsel submits that the judgment creditor/garnishee failed to fulfil the condition precedent before commencing the garnishee proceeding, and that the order nisi ought not to have been made as this honourable Court lacked the jurisdiction to make the order in the first place. e That in the case of STB Ltd v Contract Resources Ltd (No. 1) (2001) FWLR (Part 72) 1992 at 1927 Holding 6, the Court says:– f “Garnishee Order proceedings are potentially contentious for if the Garnishee disputes the Judgment Creditor’s claim, the question of his liability must have to be tried and determined.” That in the above cited case, (Olagunju, JCA) at pages 1935 g – 1936 cited with approval the case of Onwukeme v Onwukeme (1971) NNLR 10 where Bate SPJ at page 11, have (sic) this to say:– “There is evidence, which I accept, that this money is the balance h of save (sic) in execution of the Judgment Debtor’s property after a Judgment and Order against him in another case had been satisfied and that this money is in the hands of the Deputy Sheriff. The Solicitors-General of the Benue, Plateau State has (sic) given his consent in writing in accordance with Section 84 of the Sheriff i and Civil Process Law.” He also referred Court to the case of Onjewu v Kogi State Ministry of Commerce and Industry and others (2003) 10 NWLR (Part 827) 40. He submits that the failure of the j judgment creditor/garnishor to obtain the consent of the

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J 498 Nigerian Banking Law Reports [2004 – 2006] 13 N.B.L.R. (PART II) attorney-general of the Federation being the appropriate a officer in the instant case, renders the entire proceeding incompetent. That, there is evidence in this proceeding that banking b licence of the judgment debtor had been revoked on 16 January, 2006 as contained in the Federal Republic of Nigeria Official Gazette No. 3 dated the same day, much earlier before the order nisi was obtained. c Counsel submits that, as at the date judgment debtor’s banking licence was revoked, it had over withdrawn its account with the garnishee to the tune of d N18,347,522,076.93 and so, the garnishee has nothing in the account of the judgment debtor with it to attach. Counsel applies for the order absolute to be refused and the earlier order nisi be set aside. e Counsel for the garnishee submits that this garnishee proceeding, so far as it seeks to attach money alleged to be in the custody of the garnishee, is incompetent. That section 84 of the Sheriff and Civil Process Act Cap S6 Laws of the f Federation of Nigeria, 2004 provides as follows and I quote:– “(1) Where money liable to be attached by garnishee proceeding is in the custody or Under the control of a public officer in g his official capacity or in custodia legis, the Order Nisi shall not be made under the provisions of the last preceding Section unless consent to such attachment is first obtained from the appropriate officer in the case of money in the custody or control of a public officer or of the Court in the h case of money in custodia legis, as the case may be. (2) In such cases the order of notice must be served on such public officer or on the Registrar of the Court, as the case may be. i (3) In this Section ‘appropriate officer’ means– (a) in relation to money which is in the custody of a public officer who holds a public office in the public service of the Federation, the Attorney-General of the Federation. j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities Commission v Societe Generale Bank 499 (Nigeria) Ltd a (b) in relation to money which is in the custody of a public officer who holds a public office in the public service of the State, the Attorney-General of the State.” b Counsel contends that the judgment creditor failed to fulfil a condition precedent before commencing the garnishee proceeding, and the order nisi ought not to have been made because this Honourable Court, lacked the jurisdiction to c make the order in the circumstances and cites Onjewu v Kogi State Ministry of Commerce and Industry and others (2003) 10 NWLR (Part 827) 40, 76 paragraph 13 – 77 paragraph H, 89 paragraph G – 90 paragraph A. d He submits that the failure of the judgment creditor/ garnishee to obtain the consent of the Attorney-General of the Federation, who is the appropriate officer in the case of any money in the custody of the garnishee, renders the entire e proceeding incompetent, and order nisi liable to be set aside. Counsel submits that there is no doubt that the garnishee is a public officer, and if there is any money belonging to the judgment debtor in its custody, (which is denied) it holds the f money in its official capacity as a public officer and cites case of Central Bank of Nigeria v Adedeji and others (2004) 13 NWLR (Part 890) 226, 245 paragraphs E and F, MD Muhammad JCA said, concerning the garnishee:– g “The argument whether or not Appellant is a public officer has also been settled with the decision of the Supreme Court in Ibrahim v JSC (1998) 14 NWLR (Part 584) 1 at 11 where it was held thus– h ‘. . . The words public officer or any person in public office as stipulated in Section 2 of the Public Officers (Protection) Law, 1963, not only refer to natural persons or persons sued in their personal names but that they extend to public bodies, artificial persons, institutions or persons sued by their i official names or title’. . .”. Counsel contends that it is trite law that garnishee proceedings involved the attachment of debt due from a third party to the judgment debtor, and the use of the amount j of that debt in liquidating the judgment debt.

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Counsel submits that the banking licence of the judgment a debtor had been revoked as shown in paragraph 4 of the affidavit to show cause. There is also evidence that the judgment debtor had no money due to it from the garnishee. b That the judgment debtor had overdrawn its account by over N18 billion at 13 January, 2006, and up to 15 March, 2006. It is clear that at the date of the service of the order nisi on the garnishee, there was no debt due from the garnishee to c the judgment debtor, which could be attached. Counsel submits that the appropriate thing for this honourable Court to do in the circumstances is to discharge the order nisi made on 14 February, 2006, and cites Banque d Del’ Afrique Occidentale v Habu, Iliasu and Savage, in re Northern Nigeria Marketing Board (1964) NNLR 30 at 34. He further submits that the case of Savannah Bank of Nigeria Plc v Nigeria Deposit Insurance Corporation and e others (2004) 11 NWLR (Part 883) 60 is inapplicable. Counsel submits that it is not the function of garnishee to undertake the dissolution of any bank whose banking licence had been revoked, nor obtain a winding-up order nor have a f provisional liquidator appointed for the judgment debtor. That those are statutory duties of the Nigeria Deposit Insurance Corporation under the Nigeria Deposit Insurance Corporation Act Cap N102 Laws of the Federation of g Federation Nigeria, 2004, sections 5, 24, 25, 26, 27, 28 and 29 of the Act. He posits that the cash reserves, special deposits, specified liquid assets or stabilization securities are not static h and that as a bank deals with other banks, these items change, and a bank may have liabilities in excess of its assets, and consequently its specified liquid assets may become zero, while it has liabilities. i He submits that a garnishee order, apart from relating to a debt due to the judgment debtor from the garnishee, must concern a debt, which is certain in amount at the time of service of the order nisi. The judgment creditor has failed to j

[2004 – 2006] 13 N.B.L.R. (PART II) (FEDERAL HIGH COURT, ABUJA DIVISION) Chikere J National Universities Commission v Societe Generale Bank 501 (Nigeria) Ltd a show by any evidence that at the date it served the garnishee with the order nisi the judgment debtor had “over N600 Million” in the custody of the Garnishee. b Counsel urges the Court to discharge order nisi made. Babajide Oladipo, Esq. replying on points of law submits that section 84 of Sheriff and Civil Process Act Cap S6 c Laws of the Federation of Nigeria, 2004 is inapplicable as garnishee is not a public officer. That the issue of obtaining consent of the honourable Attorney-General was not averred to in the affidavit of garnishee and so submission in that d respect goes to no issue. That the Judgment Creditor had furnished more than enough materials for the exercise of Court’s discretion in its favour. e Garnishee proceedings is another method by which a judgment for payment of debt may be enforced. It is not every debt that are attachable. The debt must be a present and existing one. The Garnishee had disputed to the fact of f having any money of the judgment debtor in its possession. In fact, it had stated that judgment debtor has overdrawn its funds to a debt of N18 million. In the case of Barclays Bank DCO v Baderinwa in Re g LEDB (1962) 2 All NLR page 28, it was held that no order absolute will be made where there is doubt as to whether or not the debt attached belongs to judgment debtor. It’s absolutely clear from submission of Counsel and affidavits h that the judgment debtor has no money with garnishee. The judgment creditor is therefore to look for another way of entering judgment against the judgment debtor. The order nisi is hereby set aside.