NIGERIAN

BANKING
LAW REPORTS
[1990 – 1993]

VOLUME 5

To be cited as: [1990 – 1993] 5 N.B.L.R.

Nigeria Deposit Insurance Corporation

2009
Nigeria Deposit Insurance Corporation
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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/Director, Legal
Department
N.D.I.C.
3. Michael Olufemi Olaitan Member
Legal Practitioner
4. Ahmed Almustapha Member
Registrar-General
Corporate Affairs Commission
5. Gabriel Olukayode Kembi Member
Legal Practitioner
6. Adekunle Oladapo Omowole Member
Legal Practitioner
Corporate Affairs Commission
7. Nasiru Tijani Member
Legal Practitioner
Senior Lecturer, Nigerian Law
School
8. Belema A. Taribo Member
Legal Practitioner
N.D.I.C.
9. Moses Ter-llumun Adaguusu Member
Legal Practitioner
Corporate Affairs Commission
10. Dan Ike Agwu Secretary
Legal Practitioner
N.D.I.C.

iii
 LIST OF JUSTICES OF THE SUPREME COURT
OF NIGERIA AS AT NOVEMBER 30TH, 2007
1. HON. JUSTICE IDRIS LEGBO KUTIGI
(Chief Justice of Nigeria)
2. HON. JUSTICE SYLVESTER UMARU ONU,
CON
3. HON. JUSTICE ALOYSIUS IYORGYER
KATSINA ALU, CON
4. HON. JUSTICE NIKI TOBI, CON
5. HON. JUSTICE DAHIRU MUSDAPHER, CON
6. HON. JUSTICE GEORGE ADESOLA
OGUNTADE, CON
7. HON. JUSTICE SUNDAY AKINOLA
AKINTAN, CON
8. HON. JUSTICE ALOMA MARIAM MUKHTAR,
CON
9. HON. JUSTICE MAHMUD MOHAMMED, CON
10. HON. JUSTICE WALTER SAMUEL NKANU
ONNOGHEN, CON
11. HON. JUSTICE IKECHI FRANCIS OGBUAGU,
CON
12. HON. JUSTICE FRANCIS FEDODE TABAI,
CON
13. HON. JUSTICE IBRAHIM TANKO
MUHAMMAD, CON
14. HON. JUSTICE PIUS OLAYIWOLA ADEREMI,
CON
15. HON. JUSTICE CHRISTOPHER MITCHELL
CHUKWUMA-ENEH, CON

iv
 SENIORITY LIST OF JUSTICES OF
THE COURT OF APPEAL AS AT NOVEMBER
30TH, 2007
1. HON. JUSTICE UMARU ABDULLAHI, CON
(President)
2. HON. JUSTICE ISA AYO SALAMI, (OFR)
3. HON. JUSTICE JAMES OGENYI OGEBE, (OFR)
4. HON. JUSTICE RABIU DANLAMI
MUHAMMAD, (OFR)
5. HON. JUSTICE RAPHAEL OLUFEMI
ROWLAND, (OFR)
6. HON. JUSTICE MUHAMMAD S. MUNTAKA
COOMASIE
7. HON. JUSTICE DALHATU ADAMU, (OFR)
8. HON. JUSTICE BABA ALKALI BA’ABA
9. HON. JUSTICE SAKA ADEYEMI IBIYEYE
10. HON. JUSTICE ZAINAB ADAMU
BULKACHUWA
11. HON. JUSTICE SULEIMAN GALADIMA
12. HON. JUSTICE VICTOR AIMEPOMO O. OMAGE
13. HON. JUSTICE JOHN AFOLABI FABIYI
14. HON. JUSTICE KUMAI BAYANG AKAAHS
15. HON. JUSTICE OLUFUNLOLA OYEOLA
ADEKEYE
16. HON. JUSTICE M. DATTIJO MUHAMMAD
17. HON. JUSTICE AMIRU SANUSI
18. HON. JUSTICE CLARA BATA OGUNBIYI
19. HON. JUSTICE ISTIFANUS THOMAS
20. HON. JUSTICE JAFARU MIKA’ILU
21. HON. JUSTICE AMINAT ADAMU AUGIE
22. HON. JUSTICE ABUBAKAR ABDULKADIR
JEGA
23. HON. JUSTICE STANLEY SHENKO ALAGOA
24. HON. JUSTICE MONICA DONGBAN-
MENSEM
v
 25. HON. JUSTICE NWALE SYLVESTER
NGWUTA
26. HON. JUSTICE MOHAMMED LAWAL
GARBA
27. HON. JUSTICE JEAN OMOKRI
28. HON. JUSTICE TIJANI ABDULLAHI
29. HON. JUSTICE UWANI M. ABBA AJI
30. HON. JUSTICE MARY PETER ODILI
31. HON. JUSTICE KUDIRAT M.O. KEKERE-
EKUN
32. HON. JUSTICE MOHAMMED LADAN
TSAMIYA
33. HON. JUSTICE RAPHAEL CHIKWE AGBO
34. HON. JUSTICE BODE RHODE VIVOUR
35. HON. JUSTICE SOTONYE DENTON-WEST
36. HON. JUSTICE PAUL A. GALINJE
37. HON. JUSTICE JIMI OLUKAYODE BADA
38. HON. JUSTICE OLUKAYODE ARIWOOLA
39. HON. JUSTICE O. GEORGE SHOREMI
40. HON. JUSTICE HELEN M. OGUNWUMIJU
41. HON. JUSTICE OYEBISI FOLAYEMI
OMOLEYE
42. HON. JUSTICE ADZIRA GANA MSHELIA
43. HON. JUSTICE ABDU ABOKI
44. HON. JUSTICE AHMAD O. BELGORE
45. HON. JUSTICE ALFRED P. E. AWALA
46. HON. JUSTICE JUMMAI HANATU SANKEY
47. HON. JUSTICE IBRAHIM MOH’D M.
SAULAWA
48. HON. JUSTICE ALI A.B. GUMEL
49. HON. JUSTICE HUSSEIN MUKHTAR
50. HON. JUSTICE MOJEED A. OWOADE
51. HON. JUSTICE UZO I. NDUKWE-ANYANWU
52. HON. JUSTICE JOHN I. OKORO
53. HON. JUSTICE CHIDI NWAOMA UWA
54. HON. JUSTICE IGNATIUS IGWE AGUBE
vi
 SENIORITY LIST OF JUSTICES OF THE
FEDERAL HIGH COURT OF NIGERIA AS AT
NOVEMBER 30TH, 2007
1. HON. JUSTICE R. N. UKEJE (Chief Judge)
2. HON. JUSTICE A. MUSTAPHA
3. HON. JUSTICE D. D. ABUTU
4. HON. JUSTICE I. N. AUTA
5. HON. JUSTICE M. A. EDET
6. HON. JUSTICE A. A. ABDU-KAFARATI
7. HON. JUSTICE SOBA
8. HON. JUSTICE O. J. OKEKE
9. HON. JUSTICE S. YAHAYA
10. HON. JUSTICE A. BELLO
11. HON. JUSTICE A. O. AJAKAIYE
12. HON. JUSTICE F. F. OLAYIWOLA
13. HON. JUSTICE ADAMU HOBON
14. HON. JUSTICE J. T. TSOHO
15. HON. JUSTICE S. J. ADAH
16. HON. JUSTICE CHUKWURA NNAMANI
17. HON. JUSTICE R. O. NWODO
18. HON. JUSTICE G. C. OKEKE
19. HON. JUSTICE G. K. OLOTU
20. HON. JUSTICE J. E. SHAKARHO
21. HON. JUSTICE L. AKANBI
22. HON. JUSTICE C. M. OLATOREGUN
23. HON. JUSTICE BINTA F. M. NYAKO
24. HON. JUSTICE A. LIMAN
25. HON. JUSTICE S. YAHUZA
26. HON. JUSTICE C. ARCHIBONG
27. HON. JUSTICE I. EJIOFOR
28. HON. JUSTICE A. I. CHIKERE
29. HON. JUSTICE M. L. SHUAIBU
30. HON. JUSTICE SALIU SAIDU
vii
 31. HON. JUSTICE G. O. KOLAWOLE
32. HON. JUSTICE A. O. FAJI
33. HON. JUSTICE B. BELLO ALIYU
34. HON. JUSTICE B. I MOLOKWU
35. HON. JUSTICE A. F. ADETOKUNBO-
ADEMOLA
36. HON. JUSTICE CHUDI NWOKORIE
37. HON. JUSTICE M. I. AWOKULEHIN
38. HON. JUSTICE R. N. OFILI-AJUMOGOBIA
39. HON. JUSTICE L. ALLAGOA
40. HON. JUSTICE A. O. OGIE
41. HON. JUSTICE BABS KUEWUMI
42. HON. JUSTICE UMAR M. GARBA
43. HON. JUSTICE NYAURE BABA
44. HON. JUSTICE A. R. MOHAMMED
45. HON. JUSTICE T. ABUBAKAR

viii
 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 com-
menced 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 institu-
tions. 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, es-
pecially before the establishment of the Central Bank of
Nigeria (CBN), was small scope of operations of participat-
ing 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
ix
[1990 – 1993] 5 N.B.L.R.

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 Certifi-
cates in 1968, Certificates of Deposit in 1975 and the
Bankers’ Unit Fund as well as Stabilization Securities in
1976. The establishment of the CBN also aided the devel-
opment 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 subse-
quent deregulation of the financial system, the banking sys-
tem 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 effi-
ciency 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 depositors 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.

x
 [1990 – 1993] 5 N.B.L.R.

The Nigerian Banking System

2. The Nigeria Deposit Insurance Corporation

One of the key measures introduced during the era of de-
regulation of the banking sector was the establishment of the
Nigeria Deposit Insurance Corporation (N.D.I.C.), with the
promulgation of Decree No. 22 of 1988 now Cap 301 Laws
of the Federation 1990, (as amended). The NDIC was estab-
lished 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 man-
agement as well as the Central Bank of Nigeria’s (CBN’s)
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 impera-
tive. The establishment of NDIC was also informed by the
change in government bank-support policy, the bitter ex-
periences 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, provi-
sion of financial and technical assistance to eligible insured
institutions, prompt payment of guaranteed sums and the
orderly resolution of failed financial institutions.
xi
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

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
come forward to file their claims have been paid their in-
sured 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 publica-
tion 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 (NBLR).
Nigeria Deposit Insurance Corporation
November, 2005

xii
 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 pub-
lication 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
(F.B.T.L.R.) 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 NBLR is a compendium of case law on Nigerian
banking from 1933 to date. The first batch of the compen-
dium contains cases decided between 1933-2002 which I
understand would continue to 2004. Thereafter, the reports
would be published regularly. This initiative will prove
xiii
[1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

invaluable to users who would not have to wade through

different law reports when conducting research on Nigerian
banking case law.
The publication of the NBLR is one reliable means of dis-
seminating 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 NBLR in order
to make profit.
Specialised 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 con-
siderable public interest. I am therefore pleased that the
presentation of the Nigerian Banking Law Reports has be-
come 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

xiv
 PREFACE TO THE
NIGERIAN BANKING LAW REPORTS
The decision of the Nigeria Deposit Insurance Corporation
to publish the Nigerian Banking Law Report has its origin
from its involvement in the implementation of the Failed
Banks (Recovery of Debts) and Financial Malpractices in
Banks Act 1994. The Law was promulgated by the then
Military Government with the combined objectives of re-
covering the debts owed to failed banks and prosecuting
directors, officers and customers of banks who were sus-
pected to have committed banking malpractices, which led
to the collapse of most of the failed banks.
Furthermore, in 1994, when the Corporation was appointed
as the Liquidator to carry out the liquidation of some failed
banks, it was observed that there were hardly any records
relating to the winding up of banks that had failed in the
past. There was also no sufficient data on the causes of the
past bank failures. The Corporation therefore took the initia-
tive, 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 fail-
ures/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 experienced 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.
xv
[1990 – 1993] 5 N.B.L.R.

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 dispensa-
tion, 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 NBLR 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 Prof. Anifalaje, an erudite
professor of law and the Dean of the Faculty of Law, Uni-
versity of Ibadan ably assisted by seasoned Legal Practitio-
ners 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 NBLR. They left
no stone unturned in bringing the Corporation’s dream of
making this worthy contribution to legal knowledge and

xvi
 [1990 – 1993] 5 N.B.L.R.

Preface to the Nigerian Banking Law Reports

research a reality. Their commitment in ensuring the com-

pletion of the project is highly commendable.
Management will on its part do everything possible to en-
sure that publication of the Nigerian Banking Law Reports
(NBLR) is sustained.

G.A. Ogunleye, OFR

Managing Director/Chief Executive
November, 2005

xvii
 TABLE OF CONTENTS

Index of Table of Cases Reported ........................ xxi

Index of Subject Matter ........................................ xxiii
Index of Nigerian Cases referred to...................... xxxvii
Index of Foreign Cases referred to ....................... lvii
Index of Nigerian Statutes referred to .................. lxiii
Index of Foreign Statutes referred to.................... lxix
Index of Nigerian Rules of Court referred to ....... lxxi
Index of Foreign Rules of Court referred to ......... lxxiii
Index of Books referred to.................................... lxxv

xix
 TABLE OF CASES REPORTED
Page
1. A.C.B. Ltd v. Oba ................................................. 621
2. A.C.B. Ltd v. Obmiami Bricks and Stone
(Nig.) Ltd........................................................... 23
3. Adejuwon v. Co-operative Bank Ltd .................... 240
4. Aderibigbe v. Inspector-General of
Police Nigeria ................................................... 1
5. Aforka v. A.C.B. (Nig.) Ltd................................... 728
6. Angyu v. Alkanci .................................................. 218
7. Bank of Credit and Commerce International
v. D. Stephens Ind. Ltd ...................................... 252
8. Chief Solomon Ayansina and Labscenco (Nig.) Ltd
v. Co-operative Bank Ltd .................................. 764
9. F.A.T.B. Ltd v. Ezegbu ......................................... 504
10. F.R.N. v. Osagae .................................................. 433
11. Habib Nig. Bank Ltd v. Koya ............................... 368
12. Highgrade Maritime Services Ltd v. F.B.N. Ltd .. 54
13. I.B.W.A. Ltd v. Kennedy Tran. (Nig.) Ltd ............ 633
14. I.O.M. Nwonye and Sons Co Ltd v.
C.C.B. (Nig.) Plc ............................................... 674
15. Issa v. U.B.N. Ltd ................................................. 422
16. JJCA Faagol Instrument Ltd v. N.B.N. Ltd.......... 391
17. N.A.B. Ltd v. Shuaibu........................................... 112
18. N.B.N. Ltd v. Mobil Oil Nig. Ltd.......................... 742
19. N.B.N. Ltd v. Opeola ............................................ 710
20. N.N.B. Ltd v. Odiase ............................................ 609
21. Obimiami Brick and Stone (Nig.) Ltd v.
A.C.B. Ltd.......................................................... 299
22. Ogundeji v. I.B.W.A. Ltd ...................................... 406
23. Olasehinde v. A.C.B. Ltd...................................... 9
24. Onagoruwa v. I.G.P. ............................................ 151
25. Owena Bank (Nig.) Ltd v. Akintuyi ...................... 205
26. U.B.A. Ltd v. Ibhafidon ........................................ 466
27. U.B.N. Ltd v. Adeuya............................................ 455
28. U.B.N. Ltd v. Ozigi............................................... 82
29. U.B.N. Ltd v. Sax (Nig.) Ltd ................................. 138
30. Veritas Ins. Co Ltd v. Cititrust Inv. Ltd................ 272
31. Victory Merchant Bank Ltd v. Pelfaco Ltd .......... 691
32. Ya’u v. B.O.N. Ltd ................................................ 656
xxi
 INDEX OF SUBJECT MATTER
BANKING
Banker’s book – Admissibility of – Guiding principles –
Section 97(1)(h) and (2)(e) Evidence Act (Cap 112),
Laws of the Federation of Nigeria, 1990 A.C.B. Ltd v.
Oba [1990 – 1993] 5 N.B.L.R. 621
Bank fraud – Onus of proof – On whom lies Highgrade
Maritime Services Ltd v. F.B.N. Ltd [1990 – 1993] 5
N.B.L.R. 54
Banker and customer relationship – Bank closing account
on customer’s request – Motive of customer while
making the request – Whether material Bank of
Credit and Commerce International v. D. Stephens
Ind. Ltd [1990 – 1993] 5 N.B.L.R. 252
Banker and customer relationship – Bank granting loan to
customer – Customer’s inability to repay at agreed
time – Effect – Whether failure to repay a reprehensi-
ble conduct Victory Merchant Bank Ltd v. Pelfaco
Ltd [1990 – 1993] 5 N.B.L.R. 691
Banker and customer relationship – Banker’s refusal to
allow customer to draw on the balance of the
overdraft facility – Measure of damages recoverable
from banker by the customer – Whether such
damages should include loss of anticipated profit Issa
v. U.B.N. Ltd [1990 – 1993] 5 N.B.L.R. 422
Banker and customer relationship – Cheque drawn by
customer made payable to self – Cheque dishonoured
by bank on the ground of subsisting Order of court
stopping withdrawals from account – Whether bank
liable for dishonouring cheque I.B.W.A. Ltd v.
Kennedy Tran. (Nig.) Ltd [1990 – 1993] 5 N.B.L.R.
633

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Nigerian Banking Law Reports

BANKING – continued
Banker and customer relationship – Customer entering
into agreement to sell foreign currency in domiciliary
bank account to a third party – Banker confirmed to
third party that customer’s foreign currency
domiciliary account was in credit – Customer sold the
foreign currency to third party – Banker consequently
issued bank draft in foreign currency from the
domiciliary account of customer in favour of third
party – Third party opened an account with banker
with the bank draft – Banker later discovered that
customer’s foreign currency domiciliary account was
funded with forged bank draft – Banker consequently
dishonoured its bank draft issued to third party –
Liability of banker for refusing to honour its bank
draft U.B.A. Ltd v. Ibhafidon [1990 – 1993] 5
N.B.L.R. 466
Banker and customer relationship – Customer lodged
cheques with banker for clearing – Banker allowed
customer to draw money from his account before
cheques were cleared – Cheques were dishonoured –
Time within which banker must notify customer that
cheques were dishonoured – Liability of banker for
failure to give prompt notice to customer that cheques
were dishonoured Ya’u v. B.O.N. Ltd [1990 – 1993] 5
N.B.L.R. 656
Banker and customer relationship – Dud cheque – Banker
alleging that customer paid in dud cheques – Where
total amount claimed to be lodged by customer was
the same as the total amount banker confirmed to
have received from customer – Allegation that a
cheque is a dud cheque – On whom onus of proof lies
– How allegation of dud cheque proved N.B.N. Ltd v.
Opeola [1990 – 1993] 5 N.B.L.R. 710

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Index of Subject Matter

BANKING – continued
Banker and customer relationship – Duties of banker to
customer having Nigeria bank account and foreign
bank account – Extent of duties of the Nigerian bank
thereof Habib Nig. Bank Ltd v. Koya [1990 – 1993] 5
N.B.L.R. 368
Banker and customer relationship – Duty of care and
confidentiality owed the customer – Scope of – Limits
thereto Habib Nig. Bank Ltd v. Koya [1990 – 1993] 5
N.B.L.R. 368
Banker and customer relationship – How terminated –
Whether bank can unilaterally and arbitrarily
terminate same Bank of Credit and Commerce
International v. D. Stephens Ind. Ltd [1990 – 1993]
5 N.B.L.R. 252
Banker and customer relationship – Nature of relationship
Angyu v. Alkanci [1990 – 1993] 5 N.B.L.R. 218
Banker and customer relationship – Nature of – Whether
governed by simple or special contracts I.O.M.
Nwonye and Sons Co Ltd v. C.C.B. (Nig.) Ltd [1990
– 1993] 5 N.B.L.R. 674
Banker and customer relationship – Overdraft – Implied
overdraft – Mode of proof Olasehinde v. A.C.B. Ltd
[1990 – 1993] 5 N.B.L.R. 9
Banker and customer relationship – Overdraft/loan
granted by banker below the amount requested by
customer – Rate of interest on the overdraft/loan
neither stated nor agreed upon – Whether such loan
interest free – Effect Faagol Instrument Ltd v.
N.B.N. Ltd [1990 – 1993] 5 N.B.L.R. 391
Bank and customer relationship – Who is a customer of a
bank N.N.B. Ltd v. Odiase [1990 – 1993] 5 N.B.L.R.
609

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Nigerian Banking Law Reports

BANKING – continued
Banking transaction relating to loan and overdraft –
Nature thereof I.O.M. Nwonye and Sons Co Ltd v.
C.C.B. (Nig.) Ltd [1990 – 1993] 5 N.B.L.R. 674
Cause of action on unpaid overdraft – When it accrues
Angyu v. Alkanci [1990 – 1993] 5 N.B.L.R. 218
Cheque – Crossed cheque marked “Account payee only”
and “Not negotiable” lodged with banker – Banker
paid cheques to corporate entity different from payee
stated on the cheques – Whether banker was negligent
in paying cheques to third party in favour of whom
cheques not drawn – Whether banker entitled to
protection afforded by section 2(2) Bills of Exchange
Act, 1964 N.B.N. Ltd v. Mobil Oil Nig. Ltd [1990 –
1993] 5 N.B.L.R. 742
Cheque – “Pay Cash” inscribed on cheque – Meaning of
in banking practice – Dishonour of cheque – Whether
amounts to libel I.B.W.A. Ltd v. Kennedy Tran.
(Nig.) Ltd [1990 – 1993] 5 N.B.L.R. 633
Cheque – Purpose Highgrade Maritime Services Ltd v.
F.B.N. Ltd [1990 – 1993] 5 N.B.L.R. 54
Cheque – Uncleared effects – Nature of money drawn by
customer against uncleared effects – Whether cheques
accepted by banker for clearing are to be regarded as
absolute or conditional payments Ya’u v. B.O.N. Ltd
[1990 – 1993] 5 N.B.L.R. 656
Collective Agreement between Nigeria Employers
Association of Banks, Insurance and Allied
Institutions and Association of Employees of Banks,
Insurance and Financial Institutions – Status of –
Whether overrides conditions of service of employer
N.A.B. Ltd v. Shuaibu [1990 – 1993] 5 N.B.L.R. 112

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Index of Subject Matter

BANKING – continued
Contract in foreign currency – Whether court can order its
specific performance U.B.A. Ltd v. Ibhafidon [1990 –
1993] 5 N.B.L.R. 466
Contract of overdraft/loan facility – Offer, acceptance and
consideration – When crystallised JJCA Faagol
Instrument Ltd v. N.B.N. Ltd [1990 – 1993] 5
N.B.L.R. 391
Current account held by limited liability company –
Account in debt – Money paid in by managing
director and sole signatory of company for purpose of
bank draft in his personal capacity – Whether bank
can appropriate the money to offset company’s
indebtedness Ogundeji v. I.B.W.A. Ltd [1990 – 1993]
5 N.B.L.R. 406
Customer’s account – Banker’s right to unilaterally and
arbitrarily close same Bank of Credit and Commerce
International v. D. Stephens Ind. Ltd [1990 – 1993]
5 N.B.L.R. 252
Deposit account – payment of interest thereon – Whether
implied Angyu v. Alkanci [1990 – 1993] 5 N.B.L.R.
218
Freezing of account of customer under Banking
Amendment Decree, 1966 – Banker protected by
section 3 of the Banking Amendment Decree, 1966
Aderibigbe v. Inspector-General of Police Nigeria
[1990 – 1993] 5 N.B.L.R. 1
Inspection of books of account of customer – Section 7
Bankers Books Evidence Act, 1879 – Attitude of
court Onagoruwa v. I.G.P. 5 N.B.L.R. 151
Interest – Bankers right to charge compound interest –
Where derived – Basis of I.O.M. Nwonye and Sons

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Nigerian Banking Law Reports

BANKING – continued
Co Ltd v. C.C.B. (Nig.) Ltd [1990 – 1993] 5 N.B.L.R.
674
Interest on overdraft facilities – Basis of banks to so
charge Aforka v. A.C.B. (Nig.) Ltd [1990 – 1993] 5
N.B.L.R. 728
Letter of credit – Agreement to open same – Duty of bank
discharged once it is opened as agreed – Failure to
communicate confirming bank before particular date
– Plaintiff failing to prove same as sole basis for bank
refusing to confirm – Effect of – Bank not liable in
negligence or for breach of contract for failure to
obtain confirmation before a particular date in the
absence of agreement to that effect A.C.B. Ltd v.
Obmiami Brick and Stone Nig. Ltd [1990 – 1993] 5
N.B.L.R. 23
Letter of credit – Failure of bank to open – Breach of
contract – Measure of damages Obimiami Brick and
Stone (Nig.) Ltd v. A.C.B. Ltd [1990 – 1993] 5
N.B.L.R. 299
Loan – Interest on – Rate of – Whether bank can change
unilaterally U.B.N. Ltd v. Sax (Nig.) Ltd [1990 –
1993] 5 N.B.L.R. 138
Loan – Interest on – Where fixed – Whether bankers can
unilaterally increase U.B.N. Ltd v. Ozigi [1990 –
1993] 5 N.B.L.R. 82
Loans and advances – Interest chargeable on loan and
advances – Determinants of I.O.M. Nwonye and Sons
Co Ltd v. C.C.B. (Nig.) Ltd [1990 – 1993] 5 N.B.L.R.
674
Merger of accounts – Right of banker to merge two
separate accounts – Scope Adejuwon v. Co-operative
Bank Ltd [1990 – 1993] 5 N.B.L.R. 240
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Index of Subject Matter

BANKING – continued
Merger of accounts – Transfer of money from one
customer’s account to another in the same – Where
effected without customer’s consent – Effect
Adejuwon v. Co-operative Bank Ltd [1990 – 1993] 5
N.B.L.R. 240
Merger of separate and distinct accounts – Merger of
same without customer’s authority – Propriety of
Angyu v. Alkanci [1990 – 1993] 5 N.B.L.R. 218
Mortgage – Clause in mortgage deed that security for past
and future advances – Mortgage deed executed two
years after grant of overdraft – Whether enforceable
upon default U.B.N. Ltd v. Adeuya [1990 – 1993] 5
N.B.L.R. 455
Nature of U.B.N. Ltd v. Ozigi [1990 – 1993] 5 N.B.L.R.
82
Negligence – Requirements of negligence against a
Nigerian bank for fraudulent transfer of money
perpetrated in another bank outside Nigeria – Liability
arising therefrom – How determined Habib Nig.
Bank Ltd v. Koya [1990 – 1993] 5 N.B.L.R. 368
Negligence by banker – Scope of duty of care owed
customer by banker – Standard of Habib Nig. Bank
Ltd v. Koya [1990 – 1993] 5 N.B.L.R. 368
Non-customer of a bank using account of customer to
process foreign exchange transaction – Interest of
non-customer known to bank – Bank defaulting –
Whether non-customer can sue the bank N.N.B. Ltd v.
Odiase [1990 – 1993] 5 N.B.L.R. 609
Overdraft – Drawing cheque in excess of amount in
customer’s account – Request for overdraft I.O.M.
Nwonye and Sons Co Ltd v. C.C.B. (Nig.) Ltd [1990
– 1993] 5 N.B.L.R. 674

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Nigerian Banking Law Reports

BANKING – continued
Overdraft facility – Prerequisites of demand for
repayment Angyu v. Alkanci [1990 – 1993] 5
N.B.L.R. 218
Practice of – Principles governing U.B.N. Ltd v. Ozigi
[1990 – 1993] 5 N.B.L.R. 82
Register of shareholders – Conclusiveness of – When
availing – Section 11 Banks and Other Financial
Institutions Decree 25 of 1991 – Whether in conflict
with section 90 Companies and Allied Matters Act
(Cap 59), Laws of the Federation of Nigeria, 1990
F.A.T.B. Ltd v. Ezegbu [1990 – 1993] 5 N.B.L.R.
504
Register of shareholders – Rectification of – Only court
can order F.A.T.B. Ltd v. Ezegbu [1990 – 1993] 5
N.B.L.R. 504
Request to purchase bank draft by non-customer –
Refusal of bank to appropriate money paid for draft
for intended purpose – Effect of refusal Ogundeji v.
I.B.W.A. Ltd [1990 – 1993] 5 N.B.L.R. 406
Section 7 Banker’s Books Evidence Act, 1879 – When
can it be invoked Onagoruwa v. I.G.P. [1990 – 1993]
5 N.B.L.R. 151
Security for banker’s advances – Overdraft granted to
customer was secured by a mortgage – Customer’s
lodgements into the current account exceeded the
overdraft facility granted by banker – Whether the
overdraft should be deemed to have been repaid by
such lodgement – Preconditions for the application of
the principle of appropriation of payments Chief
Solomon Ayansina and Labscenco (Nig.) Ltd v. Co-
operative Bank Ltd [1990 – 1993] 5 N.B.L.R. 764
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Index of Subject Matter

BANKING – continued
Statement of account – Admissibility of – Conditions to
be satisfied – Section 97(2)(e) Evidence Act Cap 112
Laws of the Federation of Nigeria, 1990 –
Prerequisites of A.C.B. Ltd v. Oba [1990 – 1993] 5
N.B.L.R. 621

Statement of account – Importance of same – Evidential

value thereof Owena Bank (Nig.) Ltd v. Akintuyi
[1990 – 1993] 5 N.B.L.R. 205

Statement of account – Tendering of – Procedure –

Section 96(2)(e), Evidence Act (Cap 112), Laws of
the Federation of Nigeria Olasehinde v. A.C.B. Ltd
[1990 – 1993] 5 N.B.L.R. 9

Statement of account bearing interest – Acquiescence of

Customer thereof – Effect – Aforka v. A.C.B. (Nig.)
Ltd [1990 – 1993] 5 N.B.L.R. 728

Transacting banking business without valid licence –

Collecting money deposit from members of the public
with promise of payment of interest – Section 2(1),
(2) Banks and Other Financial Institutions Decree No.
25 of 1991 F.R.N. v. Osagae [1990 – 1993] 5
N.B.L.R. 433

Transacting banking business without valid licence –

Collecting money deposit from members of the public
with promise of payment of interest – Six months
grace period – When applicable – Section 56(1), (2)
Banks and Other Financial Institutions Decree No. 25
of 1991 F.R.N. v. Osagae [1990 – 1993] 5 N.B.L.R.
433

Transacting banking business without valid licence –

Collecting money deposit from members of the public

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Nigerian Banking Law Reports

BANKING – continued
with promise of payment of interest – Those who
represent the directing mind and will of company –
Criminal Liability of – Section 45(1), (2) Banks and
Other Financial Institutions Decree No. 25 of 1991 –
Principle governing F.R.N. v. Osagae [1990 – 1993]
5 N.B.L.R. 433
Transacting banking business without valid licence –
Company issuing advertisement inviting members of
the public to deposit money with it – Section 40(1)
Banks and Other Financial Institutions Decree No. 25
of 1991 – Ingredients of offence F.R.N. v. Osagae
[1990 – 1993] 5 N.B.L.R. 433
Transacting banking business without valid licence –
Company issuing advertisement inviting members of
the public to deposit money with it – Whether in
proving prosecution must call all material witnesses –
section 40(6) Banks and Other Financial Institutions
Decree No. 25 of 1991 F.R.N. v. Osagae [1990 –
1993] 5 N.B.L.R. 433
Unauthorised closure of deposit account – Nature of
damages arising therefrom – General or special
Angyu v. Alkanci [1990 – 1993] 5 N.B.L.R. 218
Witnesses – Sections 90(3) and 148(d) of the Evidence
Act Cap 112 Laws of the Federation of Nigeria, 1990
– Construction and purport of Highgrade Maritime
Services Ltd v. F.B.N. Ltd [1990 – 1993] 5 N.B.L.R.
54
Wrongful dishonour of cheque – Damages arising
therefrom – Parameter for award of Bank of Credit
and Commerce International v. D. Stephens Ind. Ltd
[1990 – 1993] 5 N.B.L.R. 252

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Index of Subject Matter

DAMAGES
Whether a court can award compound interest instead of
ordinary interest on an amount converted for reason
of rendering the award punitive or exemplary N.B.N.
Ltd v. Mobil Oil Nig. Ltd [1990 – 1993] 5 N.B.L.R.
742
DOCUMENT
Interpretation of – Attitude of court U.B.N. Ltd v. Ozigi
[1990 – 1993] 5 N.B.L.R. 82
EVIDENCE
Person interested under section 90(3) of the Evidence Act
Cap 112 Laws of the Federation of Nigeria, 1990 –
Who is – What determines Highgrade Maritime
Services Ltd v. F.B.N. Ltd [1990 – 1993] 5 N.B.L.R.
54
Proof – Burden of proof in civil cases – Allegation of
crime in civil cases – Standard of proof needed
Highgrade Maritime Services Ltd v. F.B.N. Ltd
[1990 – 1993] 5 N.B.L.R. 54
Withholding of evidence – Principle applicable – Section
148(d) of the Evidence Act Cap 112 Laws of the
Federation of Nigeria, 1990 Habib Nig. Bank Ltd v.
Koya [1990 – 1993] 5 N.B.L.R. 368
ILLEGALITY
Raising of by court suo motu – Principles applicable
Veritas Ins. Co Ltd v. Cititrust Inv. Ltd [1990 –
1993] 5 N.B.L.R. 272
INTEREST
Claim of on money lent – Whether makes one a money
lender Veritas Ins. Co Ltd v. Cititrust Inv. Ltd [1990
– 1993] 5 N.B.L.R. 272
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Nigerian Banking Law Reports

MONEY LENDER
Interest – Claim of interest on money lent – Whether
makes one a money lender Veritas Ins. Co Ltd v.
Cititrust Inv. Ltd [1990 – 1993] 5 N.B.L.R. 272
When is a person one – Sections 2 and 4 Moneylenders
Law Cap 85 Laws of Lagos State Veritas Ins. Co Ltd
v. Cititrust Inv. Ltd [1990 – 1993] 5 N.B.L.R. 272

MORTGAGE
Interest carrying even in absence of express provision
U.B.N. Ltd v. Sax (Nig.) Ltd [1990 – 1993] 5
N.B.L.R. 138
Power of sale – Defects in the exercise of – Remedies
available to mortgagor Victory Merchant Bank Ltd v.
Pelfaco Ltd [1990 – 1993] 5 N.B.L.R. 691

PRACTICE AND PROCEDURE

Ex parte application – What court should consider
Onagoruwa v. I.G.P. [1990 – 1993] 5 N.B.L.R. 151
Pleadings – Defendant aware that letters of credit needed
to be confirmed before a particular date – No
agreement to bind the defendant pleaded by plaintiff –
Admission by defendant is immaterial A.C.B. Ltd v.
Obmiami Brick and Stone (Nig.) Ltd [1990 – 1993] 5
N.B.L.R. 23

STATUTE
Pre-1900 Statutes of general application – How
determined Onagoruwa v. I.G.P. [1990 – 1993] 5
N.B.L.R. 151

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Index of Subject Matter

TORT
Negligence – Absence of contract between the parties –
Particulars of negligence pleaded – Effect of A.C.B.
Ltd v. Obmiami Brick and Stone (Nig.) Ltd [1990 –
1993] 5 N.B.L.R. 23

WORDS AND PHRASES

Cheque – Meaning and purpose of Highgrade Maritime
Services Ltd v. F.B.N. Ltd [1990 – 1993] 5 N.B.L.R.
54

xxxv
 INDEX OF NIGERIAN CASES REFERRED TO
A
A.C.B. Ltd v. Ehiemua (1978) 2 S.C. 73 at 76
– 77 97, 102
A.C.B. v. Ojukwu (1968) A.L.R. Comm. 199 287
A.G. Bendel State v. A.G. Federation (1982) 3
N.C.L.R. 1 188
A.G. Kaduna State v. Atta (1986) 4 N.W.L.R
(Part 38) 785 at 794 104, 108
A.G. Oyo State v. Fairlakes Hotels Ltd (1989)
5 N.W.L.R. (Part 121) 255; (1989) 12
S.C.N.J. 1 102, 427
A.G. v. John Holt and Co (1911 – 1914) 2
N.L.R. 1 178
A.R.E.C. Ltd v. Amaye (1986) 3 N.W.L.R.
(Part 31) 653 198
Abaye v. Ofili (1986) 1 S.C. 231 644
Abcos (Nig.) Ltd v. Kango Wolf Power Tools
Ltd (1987) 4 N.W.L.R. (Part 67) 894 293
Abeigbe v. Ugbodume (1973) 1 S.C. 133 228
Abinabina v. Enyimadu 12 W.A.C.A. 171;
(1953) A.C. 207 72, 80
Abiodun v. Adehin (1962) 1 All N.L.R. 550;
(1962) 2 S.C.N.L.R. 305 96
Abusomwan v. Mercantile Bank of Nigeria Ltd
(1987) 3 N.W.L.R. (Part 60) 196 102
Adamu v. Ikharo (1988) 4 N.W.L.R. (Part 89)
474 383, 738
Adegoke Motors Ltd v. Adesanya (1989) 3
N.W.L.R. (Part 109) 250 183
Adejumo and others v. Ayantegbe (1989) 3
N.W.L.R. (Part 110) 417 277
Adejumo v. The Military Governor of Lagos
State (1972) 3 S.C. 45 289
Adekunle v. State (1989) 5 N.W.L.R. 9 (Part
123) 505; (1989) 12 S.C.N.J. 182 229

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Nigerian Banking Law Reports

Adelaja v. Fanoiki (1990) 2 N.W.L.R. (Part

131) 137 479, 642
Ademiluyi v. A.C.B. Ltd (1964) N.M.L.R. 137 644
Adeniji v. Adeniji (1972) 4 S.C. 10 172
Adeniji v. Disu (1958) S.C.N.L.R. 408 262
Adeniji v. State (1992) 4 N.W.L.R (Part 234)
248 443
Aderemi v. Adedire (1966) N.M.L.R. 398 738
Adereti v. A.G. of Western Nigeria (1965) 1
All N.L.R. 254 666
Adesanya v. President, F.R.N. (1981) 2
S.C.N.L.R. 358; (1981) 5 S.C. 112; (1981) 169, 615,
All N.L.R. (Part 1) 1 618
Adeyemi v. Bamidele (1968) 1 All N.L.R. 31 414
Adeyemi v. Fadipe (1975) 1 N.M.L.R. 293 414
Adigun v. A.G. Oyo State (1987) 1 N.W.L.R. 169, 170,
(Part 53) 678 186, 720
Adigun v. A.G. Oyo State (1987) 2 N.W.L.R.
(Part 56) 97 173
Afolabi v. Government of Oyo State (1985) 2
N.W.L.R (Part 9) 734; (1985) S.C. 117 102
African Continental Seaways v. Nigerian
Dredging Roads and General Works
Limited (1977) 5 S.C. 245 664
African Newspapers of Nigeria Ltd v. Coker
(1973) 1 All N.L.R. (Part 1) 564 653
African Petroleum Ltd v. Owodunni (1991) 8
N.W.L.R. (Part 210) 391 475, 494
Afro-Continental Nig. Ltd v. Ayantuyi (1991)
3 N.W.L.R. (Part 178) 211 708
Agbonifo v. Aiwerioba (1988) 1 N.W.L.R.
(Part 70) 325 75, 465
Aguocha v. Aguocha (1986) 4 N.W.L.R. (Part
37) 566 629
Ahmed v. Kassim (1958) S.C.N.L.R. 28,
(1958) 3 F.S.C. 51 288
Aiyetan v. N.I.F.O.R. (1987) 3 N.W.L.R. (Part
59) 48 187

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Index of Nigerian Cases referred to

Ajao v. Alao (1986) 12 S.C. 193; (1986) 5

N.W.L.R. (Part 45) 802 782
Ajayi v. Texaco (Nig.) Ltd (1987) 3 N.W.L.R.
(Part 62) 577 134
Ajayi-Obe v. The Executive Secretary Family
Planning Council of Nigeria (1975) 3 S.C. 1 617
Ajibade v. Mayowa (1978) 9 – 10 S.C. 1 235
Ajide v. Kelani (1985) 3 N.W.L.R. (Part 12)
248; (1985) 11 S.C. 12 335, 339
Ajigi v. C.O.P (1977) 10 S.C. 1 442, 453
Ajikawo v. Ansaldo (Nig.) Ltd (1991) 2
N.W.L.R. (Part 173) 359 733, 739
Akinfolarin v. Akinnola (1988) 3 N.W.L.R.
(Part 81) 235 642
Akinfosile v. Ijose (1960) S.C.N.L.R. 447;
(1960) 5 F.S.C. 192 721
Akinloye v. Eyiyola (1968) N.M.L.R. 92 464
Akinola v. Oluwo (1962) 1 S.C.N.L.R. 352 75
Akinsanya v. U.B.A. Ltd (1986) 4 N.W.L.R. 44, 51,
(Part 35) 273; (1987) N.S.C.C. (Part 2) 968 361
Akpene v. Barclays Bank of Nigeria (1977) 1
S.C. 47 481
Akpor v. Iguoriguo (1978) N.S.C.C. 1115 75
Akporue v. Okei (1973) 12 S.C. 137 644
Alade v. Alemuloke (1988) 3 N.W.L.R. (Part
69) 207 169
Aladegbemi v. Fasanmade (1988) 3 N.W.L.R. 172, 644,
(Part 81) 129 646, 648
Aladetoyinbo v. Adewunmi (1990) 6 N.W.L.R.
(Part 154) 98 751
Alraine (Nig.) Ltd v. M.A. Eshiett (1977) 1
S.C. 89 40
Amadi v. Okoli (1977) 2 S.C. 57 263
Amida v. Oshoboja (1984) 7 S.C. 68 73
Amizu v. Nzeribe (1989) 4 N.W.L.R. (Part
118) 755 at 771 – 772 108
Anibire v. Womiloju CA/1/70/89 Unreported
of 14/4/93 777
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Nigerian Banking Law Reports

Anike v. Emehelu (1990) 1 N.W.L.R. (Part

128) 603 708
Anyaebosi v. R.T. Briscoe Ltd (1987) 3
N.W.L.R. (Part 59) 84 16
Animashaun v. Osuma (1972) 4 S.C. 200 172
Anyaoke v. Adi (1985) 4 S.C. 213 294
Anyaoke v. Adi (No. 2) (1986) 3 N.W.L.R.
(Part 31) 731 294
Aouad v. Kessrawani (1956) S.C. 120; 1 97, 108,
F.S.C. 35; (1956) S.C.N.L.R. 831 617
Aouad v. Nzimiro 10 W.A.C.A. 73 67
A.P. Ltd v. Owodunni (1991) 8 N.W.L.R. (Part
210) 391 475
Arab Bank Nigeria Ltd v. Dantata (1977) 7
S.C. 33 785, 790
Arinze v. State (1990) 6 N.W.L.R. (Part 155)
158 428
Aro v. Faro (1959) L.L.R. 116 644
Atano v. A.G Bendel (1988) 2 N.W.L.R. (Part
75) 201 186
Atiku v. Bodinga (1988) 2 N.W.L.R. (Part 76)
369 169
Atuyeye v. Ashamu (1987) 1 N.W.L.R. (Part
49) 267 263, 718
Awani v. Erejuwa (1976) 11 S.C. 307 654
Awolesi v. N.B.N. Ltd (1962) 1 S.C.N.L.R.
276; (1962) 1 All N.L.R. (Part 1) 172 785, 790
Awosile v. Sotunbo (1986) 3 N.W.L.R. (Part
29) 471 237
Ayanboye v. Balogun (1990) 5 N.W.L.R. (Part
151) 392 464
Ayeni v. Dada (1978) 3 S.C. 35 126
Ayoola v. Odofin (1984) 2 S.C. 120 94
Ayua v. Adasu (1992) 3 N.W.L.R. (Part 231)
598 719
B
B.E.O.O. Industries (Nig.) Ltd v. Maduakoh
(1975) 12 S.C. 91 at 108 41
xl
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

B.O.N. v. Intra Bank S.A. (1969) All N.L.R. 91 212

Bakare v. Ibrahim (1973) 1 All N.L.R. (Part
1) 751 653
Balogun v. Akanji (1988) 1 N.W.L.R. (Part
70) 301 465
Balogun v. Labiran (1988) 3 N.W.L.R. (Part 428, 429,
30) 66 431
Balogun v. N.B.N. Ltd (1978) 3 S.C. 155 263, 496
Bamgbose v. Jiaza (1991) 3 N.W.L.R. (Part
177) 64 385
Bamgboye v. University of Ilorin (1991) 8
N.W.L.R. (Part 207) 1 618
Bank of the North v. Industrial Development
Bank (unreported) CA/K/146/86 of 10/5/88 105
Bank of the North Ltd v. Intra Bank S.A.
(1969) 1 All N.L.R. 91 212
Barclays Bank D.C.O. v. Hassan (1961) All
N.L.R. 836 97, 737
Barclays Bank of Nigeria Ltd v. Abubakar
(1977) 10 S.C. 13 686, 689
Bello v. Diocesan Synod of Lagos (1973) 1 All
N.L.R. (Part 1) 247; (1973) 3 S.C. 103 195, 414
Bello v. Kassim (1969) N.M.L.R. 148 96
Bello v. Ringim (1991) 7 N.W.L.R. (Part 206)
668 431
Ben Thomas Hotels Ltd v. Sebi Furniture Ltd
(1989) 5 N.W.L.R. (Part 123) 523 212
Bisichi Tin Co Ltd v. C.O.P. (1963) N.N.L.R.
71 177
Bookshop House Ltd v. Stanley Ltd (1986) 5
S.C. 119; (1986) 3 N.W.L.R. (Part 26) 87 97
Braithwaite v. Folarin (1938) 4 W.A.C.A. 76 178
British and French Bank Ltd v. Opaleye
(1962) 1 S.C.N.L.R. 60; (1962) 1 All N.L.R. 231, 246,
26 416
Bronik Motors v. Wema Bank Ltd (1983) 1
S.C.N.L.R. 296 169

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 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

C
Chinwendu v. Mbamali (1980) 3 – 4 S.C. 31 268
Chinweze v. Mazi (1989) 1 N.W.L.R. (Part 97)
254 641
Chukwu v. Nneji (1990) 6 N.W.L.R. (Part
156) 363 362
College of Medicine University of Lagos v.
Adegbite (1973) 3 S.C. 149 617
Colony Development Board v. Kamson Ltd 21
N.L.R. 75 96

D
Deduwa v. Okorodudu (1976) 10 S.C. 329 186
Din v. A.G. Federation (1986) 1 N.W.L.R. 171, 196
(Part 17) 471
Dobadina v. Ambrose (1969) N.M.L.R. 24 177
Duriminiya v. C.O.P. (1961) N.N.L.R. 70 230

E
Ebba v. Ogodo (1984) 1 S.C.N.L.R. 372; 72, 75, 80,
(1984) 4 S.C. 84 97, 270, 464
Edokpolo and Co v. Sem Edo Wire Ind. Ltd
(1984) N.S.C.C. 533; (1984) 7 S.C. 119 524
Edun v. Odan Community (1980) 8 – 11 S.C.
103 295
Egbe v. Adefarasin (1985) 1 N.W.L.R. (Part
3) 549 173, 174, 190
Egbo v. Laguma (1988) 3 N.W.L.R. (Part 80)
109 169
Egbunike v. Muonweokwu (1962) 1
S.C.N.L.R. 97; (1962) 1 All N.L.R. 46 720, 785
Egonu v. Egonu (1973) 3 (Part 11) E.C.S.L.R.
664; (1978) 11 – 12 S.C. 111 390, 654
Ejowhomu v. Edok-Eter Mandilas Ltd (1986)
5 N.W.L.R. (Part 39) 1 277
Eka-Eteh v. Nigerian Housing Development
Society Ltd (1973) 6 S.C. 183 at 198 97, 108

xlii
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Ekanem v. Fetuga (1991) 7 N.W.L.R. (Part

204) 449 269
Ekpenyong v. Ayi (1973) 5 S.C. 169 738
Ekpenyong v. Nyong (1975) 2 S.C. 71 390, 534, 654
Ekpoke v. Usilo (1956) 6 – 7 S.C. 187 75
Ekuma v. Silver Eagle Shipping Agencies
(PH) Ltd (1987) 4 N.W.L.R. (Part 65) 472 615
Ekwunife v. Wayne (W.A.) Ltd (1989) 5
N.W.L.R. (Part 122) 422 499
Ekwuno v. Ifejika (1960) S.C.N.L.R. 320;
(1960) 5 F.S.C. 156 720
Elias v. Disu (1962) 1 S.C.N.L.R. 361 126
Elias v. Omo-Bare (1982) 5 S.C. 25 98
Eliochin (Nig.) Ltd v. Mbadiwe (1986) 1
N.W.L.R. (Part 14) 47 198
Emegokwue v. Okadigbo (1973) 4 S.C. 113 628, 664, 738
Emerah and Sons Ltd v. A. G., Plateau State
(1990) 4 N.W.L.R. (Part 147) 788 545
Enahoro Co Ltd v. B.W.A. Ltd (1971) 1 A.L.R. 101, 148,
Comm. 180; (1971) 1 N.C.L.R. 180 149, 690
Enang v. Adu (1981) 11 – 12 S.C. 25 390
Eseighe v. Agholor and another (1990) 7
N.W.L.R. (Part 161) 234 296
Ewarami v. A.C.B. Ltd (1978) 4 S.C. 99 720
Ezeani v. Ejidike (1964) 1 All N.L.R. 402 198
Ezenwosu v. Ngonadi (1988) 3 N.W.L.R. (Part
81) 163 169
Ezeomi v. Aghere (1991) 4 N.W.L.R. (Part
187) 631 196
F
F.R.N. v. Akpovona FHC/B/4C/91 of
15/1/1992 444, 448
Fabunmi v. Agbe (1985) 1 N.W.L.R. (Part 2)
299 129
Fabunmiyi v. Obaji (1968) N.M.L.R. 242 464
Fatoyinbo v. Williams (1956) 1 F.S.C. 87;
(1956) S.C.N.L.R. 274 75
Fregene v. Aweshika (1957) W.R.N.L.R. 156 620
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 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

G
Gaji v. State (1975) 5 S.C. 61 186
Garba v. Federal Civil Service Commission
(1988) 1 N.W.L.R. (Part 71) 449 171
George v. Dominion Flour Mills (1963) 1 100, 173,
S.C.N.L.R. 242, (1963) 1 All N.L.R. 71 293, 664
George v. U.B.A. Ltd (1972) S.C. 24 173
Giwa v. Erinmilokun (1961) All N.L.R. 294;
(1961) 1 S.C.N.L.R. 377 101
Gov. Lagos State v. Ojukwu (1986) 1
N.W.L.R. (Part 18) 621 171, 173
Govt. of Gongola State v. Tukur (1989) 4
N.W.L.R. (Part 117) 592; (1989) 1 ANLR
647 464, 503
Green v. Green (1987) 3 N.W.L.R. (Part 61)
480 654
H
Haco Ltd v. Udeh (1959) N.N.L.R. 61 287
Hart v. Hart (1987) 4 N.W.L.R. (Part 63) 105 262
Highgrade Maritime Services Ltd v. F.B.N.
Ltd (1991) 1 N.W.L.R. (Part 167) 290 632
Holman Brothers v. Kigo (1980) 5 – 7 S.C. at 60 172
I
I.B.W.A. v. Imana (Nig.) Ltd (1988) 3
N.W.L.R. (Part 85) 633 545
I.G.P. v. Kamara (1934) 2 W.A.C.A. 185 178
Ibekwe v. Pearce (1960) N.N.L.R. 12 287
Ibrahim v. Osim (1988) 1 N.W.L.R. (Part 82)
257 494
Idahosa v. Oransaye (1959) S.C.N.L.R. 407 432
Idika v. Esiri (1988) 2 N.W.L.R. (Part 78) 563 270
Ifezue v. Mbadugba (1984) 1 S.C.N.L.R. 427 289
Iguoriguo v. Akpor (1978) N.S.C.C. (Part 1)
1115 75
Ilechukwu v. Iwugo (1989) 2 N.W.L.R. (Part
101) 99 706

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 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Ijebu-Ode L.G. v. Adedeji Balogun and Co

(1991) 1 N.W.L.R. (Part 166) 136 419
Ikenye v. Ofune (1985) 2 N.M.L.R. (Part 5) 1 269
Ikoku v. Oli (1962) 1 S.C.N.L.R. 307; (1962)
1 All N.L.R. (vol. 1) (Part 1) 194 63, 479
Ikomi v. Bank of West Africa (Nig.) Ltd (1965)
A.L.R. Comm. 25 97
Ikonne v. C.O.P. (1986) 4 N.W.L.R. (Part 36)
473 170
Ilouno v. Chiekwe (1991) 2 N.W.L.R. (Part
173) 316 198
Imana v. Robinson (1979) 3 – 4 S.C. 1 100
Imona Russell v. Niger Construction Ltd
(1987) 3 N.W.L.R. (Part 60) 298 618
In Re Tradelinks International (Nig.) Ltd
(1977) C.C.H.C.J. 1155 168, 177
Innih v. Ferado and Co Ltd (1990) 5
N.W.L.R. (Part 152) 604 262
International Drilling Co v. Ajijala (1976) 1
All N.L.R. (Part 1) 117 136
Ipadeola v. Oshowole (1987) 3 N.W.L.R. 335, 339
(Part 59) 18 618
Iroegbu v. Okwordu (1990) 6 N.W.L.R. (Part
159) 643 377
Iyere v. Duru (1986) 5 N.W.L.R. (Part 44) 665 170, 191

J
Johnson v. Maja 13 W.A.C.A. 290 67
Johnson v. Sobaki (1968) 2 All N.L.R. 282 226

K
Kakarah v. Imonikhe (1974) 4 S.C. 151 270, 464
Kalio v. Kalio (1975) 2 S.C. 15 653
Kalu and another v. Mbuko (1988) 3
N.W.L.R. (Part 80) 86 171
Kanada v. Gov. Kaduna State (1986) 4
N.W.L.R. (Part 35) 361 188
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 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

Kate Enterprises Ltd v. Daewoo Nigeria Ltd

(1985) 2 N.W.L.R. (Part 5) 116 721
Khatoun v. Holland West Africa Lines (1961)
All N.L.R. 318 at 323; (1961) 2 S.C.N.L.R.
47 47
Kodilinye v. Odu (1935) 2 W.A.C.A. 336 97, 715, 787
Kolawole v. Alberto (1989) 1 N.W.L.R (Part
98) 382 442
Kotoye v. C.B.N. (1989) 1 N.W.L.R. (Part 98) 186, 701,
419 708
Kufeji v. Kogbe (1961) All N.L.R. 113 704
Kuti v. Balogun (1978) 1 S.C. 52 269
L
L.P.D.C. v. Fawehinmi (1985) 2 N.W.L.R.
(Part 7) 300 169
Lahan v. Lajoyetan (1972) 6. S.C. 190 784
Larinde v. Afiko 6 W.A.C.A. 108 101
Lawal v.G.B. Ollivant (1972) 3 S.C. 124 289
Lewis and Peat (N.R.I) Ltd v. Akhimien (1976)
7 S.C. 157; (1976) 1 F.N.L.R. 80 96, 716, 781
Loke v. State (1985) 1 N.W.L.R. (Part 1) 1 653
M
Macaulay v. N.A.L. Merchant Bank Ltd (1990)
4 N.W.L.R. (Part 144) 283 641
Madukolu v. Nkemdilim (1962) 2 S.C.N.L.R.
341; (1962) 2 S.C.N.L.R. 341 169
Majekodunmi v. N.B.N. Ltd (1978) 3 S.C. 119 100, 617
Makeri v. Kafinta (1990) 7 N.W.L.R. (Part
163) 411 196
Mandilas and Karaberis Ltd v. Otokiti (1963)
1 S.C.N.L.R. 69; (1963) 1 All N.L.R. 22 737
Mason v. State CA/J/48/88 16/11/1989 129
Metronex (Nig.) Ltd v. Griffin and George Ltd
(1991) 1 N.W.L.R. (Part 169) 651 498
Mercantile Bank Ltd v. Onigbanjo (1969)
N.C.L.R. 1 227

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 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Mercantile Bank v. Adalma (1990) 5

N.W.L.R. (Part 153) 747 390, 760
Minister of Internal Affairs v. Shugaba (1982)
3 N.C.L.R. 915 171
Modupe v. State (1988) 4 N.W.L.R. (Part 87)
130; (1988) 9 S.C.N.J. 1 101, 102
Mogaji v. Odofin (1978) 4 S.C. 91 129, 650, 787
Mohammed v. Kano N.A. (1968) 1 All N.L.R.
424 186
Momoh v. Senate of the National Assembly
(1981) 1 N.C.L.R. 21 188
Monier Construction Co Ltd v. Orode (1978)
1 F.C.A. 139 at 146 96
N
N.I.C.O.N. v. Power and Ind. Eng. Co Ltd
(1986) 1 N.W.L.R (Part 14) 1 99
N.I.P.C. v. Thompson Organisation Ltd (1969)
N.M.L.R. 99 16, 664
Nalsa and Team Associates v. N.N.P.C (1991)
8 N.W.L.R. (Part 212) 652 776
Nasr v. Berini (Nig.) Bank Ltd (1968) 1 All 96, 108,
N.L.R. 274 293
National Bank of Nigeria Ltd v. Awolesi
(1964) 1 A.L.R. Comm. 276 97, 101
National Bank of Nigeria Ltd v. Maja (1967) 2
A.L.R. Comm. 327 148
National Investment and Properties Co Ltd v.
Thompson Organisation Ltd
(1969) N.M.L. R. 99 100
Negbenebor v. Negbenebor (1971) 1 All
N.L.R. 210 615
Niger Progress Ltd v. North East Line
Corporation (1989) 3 N.W.L.R. (Part 107) 68 618
Nigerian Maritime Service Ltd v. Afolabi
(1978) 2 S.C. 79 54, 721
Njoku v. Eme (1973) 5 S.C. 293 738
Nneji v. Chukwu (1988) 3 N.W.L.R. (Part 81) 294
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Nigerian Banking Law Reports

184
Nsirimi v. Nsirimi (1990) 3 N.W.L.R. (Part
138) 285 262
Nsude v. Anigbo (1958) N.R.L.N.R. 96 287
Nwabueze v. Okoye (1988) 10 – 11 S.C.N.J.
60; (1988) 4 N.W.L.R. (Part 91) 664 100
Nwachukwu v. Egbuchu (1990) 3 N.W.L.R. 425, 427,
(Part 160) 72 431
Nwadike v. Ibekwe (1987) 4 N.W.L.R. (Part
67) 718 776, 777
Nwangwu v. Nzekwu (1957) S.C.N.L.R. 61; 100, 108,
(1957) 2 F.S.C. 36 617
Nwosu v. State (1990) 7 N.W.L.R. (Part 162)
322 720

O
Obasi v. Onwuka (1987) 3 N.W.L.R. (Part 61)
364; (1987) S.C.N.J. 84 262
Obe v. Executive Secretary F.P.C.N. (1975) 3
S.C. 1 100, 104
Obembe v. Wema Board Estate (1977) 5 S.C.
115 at 138 99, 101, 108
Obeya Memorial Specialist Hospital v. A.G.
Federation (1987) 3 N.W.L.R. (Part 60) 325 701, 703
Obi v. Owolabi (1990) 5 N.W.L.R. (Part 153)
702 362
Obikoya and Sons Ltd v. Gov. Lagos State
(1987) 1 N.W.L.R. (Part 50) 385 169, 195
Obikoya v. WEMA Bank Ltd (1989) 1 N.W.L.R.
(Part 96) 157; (1989) 1 S.C.N.J. 129 615
Obimonure v. Erinosho (1966) 1 All N.L.R. 169
Obisanya v. Nwoko (1974) 6 S.C. 69 262
Obodo v. Olomu (1987) 3 N.W.L.R. (Part 59)
111 294, 296
Ochonma v. Unosi (1965) N.M.L.R. 221 628, 739
Odadhe v. Okujeni (1973) 11 S.C. 343 654
Odi v. Osafile (1987) 2 N.W.L.R. (Part 57)
510 129

xlviii
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Odiase v. Agho (1972) 1 All N.L.R. (Part 1)

170; (1972) 3 S.C. 71 98, 171
Odiba v. Azege (1991) 7 N.W.L.R. (Part 206)
724 386
Odiete v. Okotie (1972) 6 S.C. 83 131
Oduka v. Kasumu (1976) N.M.L.R. 28 738
Odumosu v. A.C.B. Ltd (1976) 11 S.C. 55 426, 427
Odusote v. Odusote (1971) 1 All N.L.R. 219 229
Official Receiver and Liquidator v. Moore
(1959) L.L.R. 46 227
Ogbechie v. Onochie (1986) 2 N.W.L.R. (Part
23) 484 776
Ogbechie v. Onochie (1988) 1 N.W.L.R. (Part
70) 370; (1988) 2 S.C.N.J. 170, 185 94
Ogbu v. Urum (1981) 4 S.C. 1 168
Ogiamen v. Ogiamen (1967) 1 All N.L.R. 191 172
Ogida v. Oliha (1986) 1 N.W.L.R. (Part 19)
786 262
Oguche v. Iliyasu and others (1971) 2 All
N.L.R. 333 287
Oguma Associated Companies (Nig.) Ltd v.
I.B.W.A (1988) 3 S.C.N.J. (Part 1) 13;
(1988) 1 N.W.L.R (Part 73) 658 16, 99
Ogunlade v. Adeleye (1992) 8 N.W.L.R. (Part
260) 409 414
Ojikutu v. A.C.B. (1968) 1 All N.L.R. 40 690
Ojikutu v. Odeh (1954) 4 W.A.C.A. 640 213
Ojo v. Abegunrin (1989) 5 N.W.L.R. (Part
120) 162 739
Ojo v. Adejobi (1978) 3 S.C. 65 at 75 94
Ojogbue v. Nnubia (1972) 1 All N.L.R. (Part
2) 226 94
Ojukwu v. A.C.B. Ltd (1968) 1 All Comm. 161 96
Ojukwu v. Onyeador (1991) 7 N.W.L.R. (Part
203) 286 377
Okafor v. Idigo (1984) 1 S.C.N.L.R. 481 75, 270, 464
Okechukwu and Sons v. Ndah (1967)
N.M.L.R. 368 721
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Nigerian Banking Law Reports

Okoduwa v. The State (1988) 2 N.W.L.R.

(Part 76) 333 186
Okolo v. Uzoka (1978) 4 S.C. 77 72, 80
Okonji v. Njokanma (1991) 7 N.W.L.R. (Part
202) 131; (1989) 4 N.W.L.R. (Part 114) 161 650
Okorie v. Queen (1963) 1 S.C.N.L.R. 24 262
Okorie v. Udom (1960) S.C.N.L.R. 326 262
Okoro v. Delta Steel Co Ltd (1990) 2
N.W.L.R. (Part 130) 87 545
Okosisi v. F.R.N. FHC/B/6C/91 Unreported
23/12/91 441
Okpala v. Ibeme (1989) 2 N.W.L.R. (Part 102)
208 642
Okparaeke v. Egbuonu (1941) 7 W.A.C.A. 53 632
Okpiri v. Jonah (1961) 1 S.C.N.L.R. 174 75
Okubule v. Oyagbola (1990) 4 N.W.L.R. (Part
147) 723 760
Okule v. State (1990) 7 N.W.L.R (Part 164) 58 442
Okumagba v. Egbe (1965) All N.L.R. 62 289
Okupe v. Federal Board of Inland Revenue
(1974) N.S.C.C. 200 640
Okupe v. Ifemembi (1974) All N.L.R. (Part 1)
375 414
Okuoja v. Ishola (1982) 7 S.C. 314 at 349 73
Olaogun Int. Ltd v. S.J. and M. (1992) 4
N.W.L.R. (Part 235) 361 498
Olasehinde v. A.C.B. Ltd (1990) 7 N.W.L.R.
(Part 161) 180 215, 216
Olatunbosun v. NISER Council (1988) 3
N.W.L.R. (Part 80) 25 134
Olawuyi v. Adeyemi (1990) 4 N.W.L.R. (Part
147) 746 628, 718
Oloba v. Akereja (1988) 3 N.W.L.R. (Part 84)
508 169
Oloriode v. Oyebi (1984) 5 S.C. 1 654
Olowosoke v. Oke (1972) 11 S.C. 1 776
Olubode v. Oyesina (1977) 5 S.C. 79 632
Olubusola Stores v. Standard Bank Nigeria
Ltd (1975) 4 S.C. 51 280
l
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Olukade v. Alade (1976) 1 All N.L.R. (Part 1)

67 70
Olatubosun v. NISER Council (1988) 3
N.W.L.R. (Part 80) 25 169
Omogodo v. State (1981) 5 S.C. 5 442, 444
Omoniyi v. Central Schools Board (1988) 4
N.W.L.R. (Part 89) 448 186
Omonuwa v. Wahabi (1974) 4 S.C. 37 232
Onaga v. Micho and Co (1961) 2 S.C.N.L.R.
101 265
Onagoruwa v. Nwokedi (1982) 3 N.C.L.R.
547 169
Onashile v. Idowu (1961) 2 S.C.N.L.R. 53 289
Onobruchere v. Esegine (1986) 2 S.C. 385,
386; (1986) 1 N.W.L.R (Part 19) 799 96, 108
Onyenma v. Amah (1988) 1 N.W.L.R. (Part
73) 772 at 774 21, 22
Opeola v. Falade (1991) 2 N.W.L.R. (Part
173) 303 503
Orewere v. Abiegbe (1973) 9 – 10 S.C. 1 644
Orizu v. Anyaegbunam (1978) 1 L.R.N. 216 at
221 98
Osawaru v. Ezeiruka (1978) 6 – 7 S.C 135 721
Otapo v. Sunmonu (1987) 2 N.W.L.R. (Part
58) 587 169
Owoade v. Omitola (1988) 2 N.W.L.R. (Part
77) 413 738
Oyenuga v. Ife University (1964) 2 A.L.R.
Comm. 327 97
Oyewole v. Standard Bank of West Africa
(1968) 2 All N.L.R. 32 651
Ozigbo v. C.O.P. (1976) 2 S.C. 67 271

P
Pas (Nig.) Limited v. N.N.S. Co Ltd (1990) 6
N.W.L.R. (Part 159) 764 726
Paul v. George (1959) S.C.N.L.R. 510; (1959)
4 F.S.C. 198 293
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Nigerian Banking Law Reports

Peenok Investments Ltd v. Hotel Presidential

Ltd (1983) 4 N.C.L.R. 122 195
Pharmacists Board of Nigeria v. Adegbesote
(1986) 3 N.W.L.R. (Part 44) 707 384

R
R v. Iregbu (1938) 4 W.A.C.A. 32 72
Rickett v. B.W.A. Ltd (1960) S.C.N.L.R. 227; 101, 146,
(1960) 5 F.S.C. 113 687, 689,
762
S
Sabbagh v. Bank of West Africa Ltd (1962)
L.L.R. 174 97
Sachia v. Kwande Local Gov. (1990) 5
N.W.L.R. (Part 152) 548 183
Sagay v. M.N.I. (1977) 5 S.C. 143 172
Salami v. S.B.N. Ltd (1990) 2 N.W.L.R. (Part
130) 106 427
Saraki v. Kotoye (1990) 4 N.W.L.R. (Part
143) 144 707
Savannah Bank v. Ajilo (1989) N.W.L.R. (Part
97) 305 443
SCOA Ltd v. Okoebor (1958) S.C.N.L.R. 303;
(1958) 3 F.S.C. 87 618
Seismograph Service Ltd v. Akporuovo (1974)
6 S.C. 119 386
Sha v. Standard Bank Ltd (1967) 1 A.L.R.
Comm. 209 101
Shell B.P. Petroleum Development Co v. Cole
(1978) 3 S.C. 183 101, 102
Shell B.P. v. Jammal Engineering Ltd (1974)
4 S.C. 33; 1 All N.L.R (Part 1) 542 419
Shell B.P. Ltd v. Abedi (1974) 1 All N.L.R. 1;
(1974) 1 S.C. 23 664, 739
Shell Petroleum v. Otoko (1990) 6 N.W.L.R.
(Part 159) 693 388
Shitta-Bey v. F.P.S.C. (1981) 1 S.C. 40 172

lii
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Shonibare v. Ijale (1960) S.C.N.L.R. 384 100

Skenconsult (Nig.) Ltd v. Ukey (1981) 1 S.C. 6 94, 168,
172, 175,
182, 647
Sketch Publishing Co Ltd v. Ajagbemokeferi
(1989) 1 N.W.L.R. (Part 100) 678 267
Sodipo v. Lemminkainen Oy (1985) 2
N.W.L.R. (Part 8) 547 292
Sodipo v. Lemminkainen Oy (1986) 1 175, 282,
N.W.L.R. (Part 15) 220; (1986) 1 S.C. 197 481, 488
Sommer v. F.H.A. (1992) 1 N.W.L.R. (Part
219) 548 364
Standard Consolidated Dredging and
Construction Co Ltd v. Katonecrest Nigeria
Ltd (1986) 5 N.W.L.R. (Part 44) 791 277
State v. President Oyo North Divisional Grade
‘B’ Customary Court (1969) 2 All N.L.R. 45 647
Stitch v. A.G. Federation (1986) 5 N.W.L.R.
(Part 46) 1007 102
Sule v. Nigerian Cotton Board (1985) 2
N.W.L.R. (Part 5) 17 187
T
Technoplastic v. Jatau (1986) 4 N.W.L.R.
(Part 38) 771 425
Tiamiyu and others v. Ashiru (1955) 2
N.R.N.L.R. 42 287
Tijani v. Akinwunmi (1990) 1 N.W.L.R. (Part
125) 237 377
Tika Tore Ltd v. Abina (1973) N.M.L.R. (Vol.
1) 220; (1973) 12 S.C. 79 525
Timitimi v. Amabebe (l953) 14 W.A.C.A. 374 174
Total Nigeria Ltd v. Nwako (1978) 5 S.C. 1 653
Trans Bridge Co Ltd v. Survey International
Ltd (1986) 2 N.W.L.R. (Part 37) 576 530
Trenco Ltd v. African Real Estate (1978) 4
S.C. 9 416

liii
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

U
U.A.C. (Tech.) Ltd v. Anglo Canadian Cement
Ltd (1966) N.M.L.R. 349 213
U.A.C. v. Taylor 2 W.A.C.A. 67 77, 81
U.B.A. Ltd v. Achoru (1990) 6 N.W.L.R. (Part 264, 360,
156) 254 718
U.B.N. Ltd v. Nnoli (1990) 4 N.W.L.R. (Part
145) 530 384
U.D.C. v. Ladipo (1971) 1 All N.L.R. 102 235
U.T.C. (Nig.) Ltd v. Pamotei (1989) 2
N.W.L.R. (Part 103) 244 212
Udekwu v. Nwosu (1976) 2 A.L.R. Comm.
387 94
Udoh v. O.H.M.B. (1990) 4 N.W.L.R. (Part
142) 52 545
Ugo v. Obiekwe (1989) 1 N.W.L.R. (Part 99)
566; (1988) 2 S.C.N.J. 95 277
Uhunmwangho v. Okojie (1989) 5 N.W.L.R.
(Part 122) 471 443
Ukpai v. Okoro (1983) 2 S.C.N.L.R. 380;
(1983) 11 S.C. 231 169
Uku v. Okumagba (1974) 3 S.C. 35 172, 654
Union Bank (Nig.) Ltd v. Ozigi (1991) 2 141, 142,
N.W.L.R. (Part 176) 677 143, 146,
399, 400,
403, 686
Union Bank (Nig.) Ltd v. Sax (Nig.) Ltd (1991) 399, 400,
7 N.W.L.R. (Part 202) 233 401
Unuwa v. N.T.A. (1961) All N.L.R. 567 97
Uwa Printers v. Investment Trust Ltd (1988) 5
N.W.L.R. (Part 92) 110; (1988) 12 S.C.N.J.
102 427, 429
Uyo v. Egware (1974) 1 All N.L.R. 293 431
Uzor v. Nigeria Stores Workers Union (1973)
9 – 10 S.C. 35 654
W
Western Nig. Development Corporation v.
Abimbola 1966 N.M.L.R. 381 136

liv
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Cases referred to

Williams v. Daily Times of Nigeria Ltd (1990)

1 N.W.L.R. (Part 124) 1 198
Willoughby v. International Merchant Bank
(Nig.) Ltd (1987) 1 N.W.L.R. (Part 48) 105 294
Woluchem v. Gudi (1981) 5 S.C. 291 73, 97, 464
Y
Yesufu v. A.C.B. Ltd (1976) 4 S.C. 1; (1976)
N.M.L.R. 83 16, 177
Yesufu v. A.C.B. Ltd (1980) 1 S.C. 74 495, 630
Yusuf v. Union Bank of Nigeria Ltd
CA/J/24/88 135
Z
Zoramawa v. Alkanci (1972) N.N.L.R. 15 98

lv
 INDEX OF FOREIGN CASES REFERRED TO
A
Addis v. Gramophone Co Ltd (1909) A.C. 488 135
Ali v. Saad (No. 2) (1976) 1 A.L.R. Comm.
405 96
American Cyanamid Co v. Ethicon Ltd (1975)
A.C. 306 701
Anisminic Ltd v. Foreign Compensation
Commission (1969) 2 A.C. 147 647
Arnott v. Hayes (1887) 36 Ch.D. 731 168, 174,
177, 180
Associate Leisure v. Associated Newspapers
(1970) 2 Q.B. 456 652
Atlantic, The and The Battyk (1946) 62,
T.L.R. 461 79
Australian Apple and Pear Marketing Board
v. Tonking 66 CLR 77 191
B
Baillie v. Oriental Telephone Electric Co Ltd
(1950) 1 Ch.D. 503 526
Bamford v. Bamford (1970) 1 Ch.D. 212 525
Barclays Bank International Limited v. Levin
Brothers (Bradford) Ltd (1976) 3 All E.R.
900 498
Barkway v. South Wale Transport Co Ltd
(1949) 1 K.B. 54 79
Bearmans Ltd v. Metropolitan Police District
Receiver (1961) 1 W.L.R. 634 71, 79
Blackpool Corporation v. Locker (1948) 1 All
E.R. 85 at 92 36
Bolton Engineering Co v. Graham and Sons
Ltd (1957) 1 Q.B. 159 at 172 449
Bradlaugh v. Clarke (1883) 8 App. Cas. 354 107
Bridges v. Berry (1810) 3 Taunt 130; 128 ER
51 667, 669

lvii
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

Buckingham and Co v. London and Midland

Bank (1895) 12 T.L.R. 70 246
Burland v. Earle (1902) A.C. 83 599
C
Camidge v. Allenby (1827) 6 B. and C. 373
(108) E.R. 489 668, 669
Cassell and Co Ltd v. Broome (1972) 2
W.L.R. 645 200
Chatney v. Brasilian Submarine Telegraph Co
(1891) 1 C.B. 79 at 85 107
Commissioner of Taxation v. English Scottish
and Australian Bank (1920) A.C. 683 616
Commonwealth Development Corporation v.
Central Construction Power Corporation
(1968) 3 A.L.R. Comm. 406 at 413 96
Cotter v. National Union of Seamen (1929) 2
Ch. 58 526
Crosskill, Bower, Bower v. Turner (1863) 3 110, 148,
L.J. Ch. 540; (1863) Bear 86 736, 790
Cuthbert v. Roberts Lubbock and Co (1909) 2
Ch.D. 226 666
D
Dinna Bhai and Co Ltd v. Ustaz Estate Ltd
(1969) 2 A.L.R. Comm. 514 at 517 96
E
Everett v. Grifiths and another (1921) 1 A.C.
631 174
Evon v. Noble (1949) 1 K.B. 222 71, 79
F
Fidelitas Shipping Co v. Expertochleb (1966)
1 Q.B. 630 475
Fine Art Society v. Union Bank of London
(1886 – 87) 17 Q.B. 705 753
Foss v. Harbottle (1843) 2 Hare 461 521, 523,
524, 532,
553, 598, 599
Fritz v. Hobson (1880) 14 Ch.D. 542 644
lviii
 [1990 – 1993] 5 N.B.L.R.

Index of Foreign Cases referred to

G
Galler v. Galler (1955) 1 W.L.R. 500 79
Garnett v. Ferrand (1827) 6 B and C 611 189
Garnett v. M’kewan (1872) 2 L.R. 8 Ex. 10 246
George Moore Ice Cream Company v. Rose
77 L. Ed. 1265 541
Gordon v. London City and Midland Bank Ltd
(1902) 1 K.B. 242 751, 753, 754
Great Western Railway Co v. London and
County Banking Co Ltd (1901) A.C. 414 616
Greenhalgh (W.P.) and Sons v. Union Bank of
Manchester (1924) 2 K.B. 153; (1924) All
E.R. Rep. 338 246, 411, 416
Growe v. Clay 9 Ech. 604 (156 E.R. 258) 667
Gwyn v. Godby (1812) 4 Taunt 346 148, 736
H
Hadley v. Baxendale (1854) 9 Ex. 341; (1843
– 1860) All E.R. Rep. 461 40
Haeyener v. Loames 3 C.L. 306 701
Holder v. Inland Revenue Commissioners
(1932) A.C. 624 736
Hornal v. Neuberger Products Ltd (1957) 1
Q.B. 247; (1956) 3 All E.R. 970 652
Howard v. Beall (1889) 23 Q.B.D. 1 177
Howell v. Dering (1915) 1 K.B. 54 781
J
Joachimson v. Swiss Bank Corporation (1921)
3 K.B. 110; (1921) All E.R. 92 226, 617
Johnson Stansfield and Sons v. Butterworth
(1948) 2 E.R 558 at 564 36
Johnson v. Sargant and Sons (1918) 1 K.B.
101 at 103 36
K
Kinlan v. Ulster Bank (1928) 1 I.R. 171 651
Kuruma v. R. (1955) A.C. 1975 126

lix
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

L
Levy v. Abber Corns Slate and Slab Co (1888)
37 Ch. 260 442
Liesbosch Dredges v. Edison Steamship
(1933) A.C. 449 at 460 40
Lion Insurance Co v. Tucker (1883) 12 Q.B.D.
176 107
Litchfield-Spear v. Queen Anne’s Gate
Syndicate (N.2) (1919) 1 Ch. 407 706
Liversidge v. Anderson and another (1942)
A.C. 206 7
London Chartered Bank of Australia v. Whyte
(1879) 4 A.C. 413 (P.C.) 688
M
M’Combie v. Danies (1805) 5 East 538 752
Macfoy v. U.A.C. (1962) A.C. 152 94, 647
Mengana v. Lloyd (1908) L.T. 640 652
Miliangos v. George Frank Textiles Ltd
(1975) 3 All E.R 801; (1976) A.C. 443 498
Mills v. United Country’s Bank Ltd (1912) 9
Chancery 231 96
Morrison v. London County and Westminster
Bank (1914) 3 K B 356 751
P
Paton v. Inland Revenue Commissioners
(1938) A.C. 341 736
Peacock v. Pursell (1863) 14 C.B. (N.S.) E.R.
630 668, 669
Perestrello E. Companhia Limitada v. United
Paint Co Ltd (1969) 1 W.L.R. 579 41, 364
Perry v. Phosphor Bronze Co Ltd (1894) 71
L.T. 854 174, 177, 181
R
R. v. Halliday (1917) A.C. 260, 269 7
Re Jauncey, Bird v. Arnold (1926) Ch. 471 736
Re Kerr’s Policy (1869) L.R. 8 Eq. 331 149
lx
 [1990 – 1993] 5 N.B.L.R.

Index of Foreign Cases referred to

Re: Homer District Consolidated Gold Mines

(1988) 39 Ch.D. 546 521, 598
Reddie v. Williamson (1863) 1 Macph. (Ct. of
Sess.) 228 736
Re Powe, Powe v. Barclays Bank Ltd P. 110 79
Republic of Peru v. Dreyfus Bros and Co
(1988) Ch.D. 348 704
Rookes v. Bernard (1964) 1 All E.R. 367 198
Ross v. London County Westminster and
Parr’s Bank Ltd (1919) 1 K.B. 678 757

S
Sangrove v. Hole (1901) 2 K.B. 1 650
Schorsch Meior GMBN v. Hennin (1975) 1
All E.R. 152 at 156 498
Scott v. Stansfied (1868) L.R. 3 Ex. 200 189
Selangor United Rubber Estates Ltd v.
Cradock (1968) 2 L.R. 289 617
Sirros v. Moore (1974) 3 W.L.R. 459 189
Skinner v. Carter (1948) 1 Ch.D. 387 646
Smallwood v. Gallardo 72 [Link]. 152 541
Smith v. Cooke (1891) A.C. 297 96
Smith v. Selwyn (1914) 3 K.B. 98 286
South Staffordshire Tramways Co v. Ebbsmith
(1985) 2 Q.B. 669 174, 177

T
The Halcyon the Great (1975) 1 All E.R 882 498
Turner v. Stallibrass 67 L.J., Q.B.N.S. 52 47

U
United City Merchants (Investments) Ltd v.
Royal Bank of Canada (1983) 1 A.C. 168 44, 51

W
Warner v. Jacob (1882) 20 Ch.D. 220 108
Waterhouse v. Barker (1924) 2 K.B. 759 174, 177
Watson v. Russel 3B and S.3, 38; 5B and S.968 497

lxi
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

Watt or Thomas v. Thomas (1947) A.C. 484 75

Wolf v. Hamilton (1898) 2 Q.B. 337 481, 487
Woods v. Martins Bank Ltd (1958) 3 All E.R.
166 616
Y
Yourell v. Hibernian Bank Ltd (1918) A.C.
372 736, 790

lxii
 INDEX OF NIGERIAN STATUTES
REFERRED TO
Banking Act, 1969
s 14......................................[1990 – 1993] 5 N.B.L.R. 144
Banking Amendment Decree, 1966
s 1(1) .......................................[1990 – 1993] 5 N.B.L.R. 6
s 3............................................[1990 – 1993] 5 N.B.L.R. 8
s 4(2) .......................................[1990 – 1993] 5 N.B.L.R. 8
Banks and Other Financial Institutions Decree No. 25 of
1991
s 11.....................[1990 – 1993] 5 N.B.L.R. 540, 541, 542,
545, 546, 563, 570, 604, 606
s 40(1) .........................[1990 – 1993] 5 N.B.L.R. 443, 450
s 40(5) .................................[1990 – 1993] 5 N.B.L.R. 443
s 40(6) .................................[1990 – 1993] 5 N.B.L.R. 451
s 45(1) .................[1990 – 1993] 5 N.B.L.R. 443, 448, 450
s 56(1) .................................[1990 – 1993] 5 N.B.L.R. 447
s 56(2) .........................[1990 – 1993] 5 N.B.L.R. 443, 447
s 56(3) .................................[1990 – 1993] 5 N.B.L.R. 447
s 61......................................[1990 – 1993] 5 N.B.L.R. 443
Bills of Exchange Act, 1964
s 2(2)(a) ..............................[1990 – 1993] 5 N.B.L.R. 753
s 2(2)(b) ..............................[1990 – 1993] 5 N.B.L.R. 753
Bills of Exchange Act Cap 35 Laws of the Federation of
Nigeria, 1990
s 47..............................[1990 – 1993] 5 N.B.L.R. 667, 668
s 48 .............................[1990 – 1993] 5 N.B.L.R. 667, 668
s 49..............................[1990 – 1993] 5 N.B.L.R. 667, 668
Companies Act, 1968
s 26(2) .................................[1990 – 1993] 5 N.B.L.R. 595
s 108....................................[1990 – 1993] 5 N.B.L.R. 605

lxiii
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

Companies and Allied Matters Act Cap 59 Laws of the

Federation of Nigeria, 1990
s 65......................................[1990 – 1993] 5 N.B.L.R. 554
s 83(1) .................................[1990 – 1993] 5 N.B.L.R. 605
s 90......................[1990 – 1993] 5 N.B.L.R. 571, 572, 598
s 90(1) .................................[1990 – 1993] 5 N.B.L.R. 601
s 90(1)(a) ....................[1990 – 1993] 5 N.B.L.R. 522, 544
s 90(1)(b) ....................[1990 – 1993] 5 N.B.L.R. 522, 544
s 90(3) .........................[1990 – 1993] 5 N.B.L.R. 523, 544
s 91......................[1990 – 1993] 5 N.B.L.R. 564, 571, 605
s 124....................................[1990 – 1993] 5 N.B.L.R. 528
s 233(1) ...............................[1990 – 1993] 5 N.B.L.R. 603
s 296............................[1990 – 1993] 5 N.B.L.R. 534, 535
Constitution of the Federal Republic of Nigeria, 1979
s 1(1) ...................................[1990 – 1993] 5 N.B.L.R. 188
s 1(3) ...................................[1990 – 1993] 5 N.B.L.R. 188
s 6(6)(b) ......[1990 – 1993] 5 N.B.L.R. 528, 531, 598, 601
s 33(1) .........[1990 – 1993] 5 N.B.L.R. 172, 176, 184, 186
s 138(1) ...............................[1990 – 1993] 5 N.B.L.R. 163
s 195(1) ...............................[1990 – 1993] 5 N.B.L.R. 163
s 220(1) .......................[1990 – 1993] 5 N.B.L.R. 719, 775
s 221(1) .......................[1990 – 1993] 5 N.B.L.R. 720, 775
s 234(1) .......................[1990 – 1993] 5 N.B.L.R. 163, 183
s 234(2)(a) and (b)..............[1990 – 1993] 5 N.B.L.R. 183
s 277(1) ...............................[1990 – 1993] 5 N.B.L.R. 774
Conveyancing Act of 1881
s 19........................................[1990 – 1993] 5 N.B.L.R. 97
Court of Appeal Act, 1981
s 25(2)(a) ............................[1990 – 1993] 5 N.B.L.R. 775
Court of Appeal Act Cap 75 Laws of the Federation of
Nigeria, 1990
s 16......................................[1990 – 1993] 5 N.B.L.R. 632
Criminal Code Act, 1958
s 5........................................[1990 – 1993] 5 N.B.L.R. 287
lxiv
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Statutes referred to

Evidence Act Cap 112 Laws of the Federation of Nigeria,

1990
s 8........................................[1990 – 1993] 5 N.B.L.R. 125
s 34......................................[1990 – 1993] 5 N.B.L.R. 382
s 75......................................[1990 – 1993] 5 N.B.L.R. 632
s 90(3) .......................[1990 – 1993] 5 N.B.L.R. 71, 78, 79
s 96(1) .................[1990 – 1993] 5 N.B.L.R. 379, 380, 381
s 96(1)(a) ............................[1990 – 1993] 5 N.B.L.R. 382
s 96(1)(h) ..............................[1990 – 1993] 5 N.B.L.R. 17
s 96(2)(e).........................[1990 – 1993] 5 N.B.L.R. 17, 18
s 97(1)(h) ............................[1990 – 1993] 5 N.B.L.R. 630
s 97(2)(e).............................[1990 – 1993] 5 N.B.L.R. 630
s 135......................................[1990 – 1993] 5 N.B.L.R. 67
s 136....................................[1990 – 1993] 5 N.B.L.R. 108
s 137......................................[1990 – 1993] 5 N.B.L.R. 63
s 137(1) ...............[1990 – 1993] 5 N.B.L.R. 758, 759, 760
s 138......................................[1990 – 1993] 5 N.B.L.R. 67
s 138(1) ...............................[1990 – 1993] 5 N.B.L.R. 502
s 140......................................[1990 – 1993] 5 N.B.L.R. 67
s 148(d) ....................[1990 – 1993] 5 N.B.L.R. 71, 77, 80,
99, 237, 238, 385, 494
s 149(d) ...............................[1990 – 1993] 5 N.B.L.R. 788
Exchange Control Act, 1962 now Cap 113 Laws of the
Federation, 1990
s 3(1) ...................................[1990 – 1993] 5 N.B.L.R. 488
s 3(2) ...................................[1990 – 1993] 5 N.B.L.R. 488
Foreign Currency (Domiciliary Accounts) Act Cap 151
Laws of the Federation of Nigeria, 1990
s 1(1) ...................................[1990 – 1993] 5 N.B.L.R. 493
s 1(2) ...........................[1990 – 1993] 5 N.B.L.R. 490, 493
s 2(1) ...................................[1990 – 1993] 5 N.B.L.R. 484
s 3(1) ...................................[1990 – 1993] 5 N.B.L.R. 484
s 3(2) ...................................[1990 – 1993] 5 N.B.L.R. 484
s 3(3) ...................................[1990 – 1993] 5 N.B.L.R. 485
s 3(4) ...................................[1990 – 1993] 5 N.B.L.R. 485
s 3(5) ...................................[1990 – 1993] 5 N.B.L.R. 485
lxv
 [1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

s 3(6) ...................................[1990 – 1993] 5 N.B.L.R. 485

Foreign Currency (Domiciliary Accounts) Act Cap 151

Laws of the Federation of Nigeria, 1990 (continued )
s 3(7) ...................................[1990 – 1993] 5 N.B.L.R. 485
s 3(8) ...................................[1990 – 1993] 5 N.B.L.R. 485
s 6(1) ...................................[1990 – 1993] 5 N.B.L.R. 486
High Court Law of Lagos State
s 10......................................[1990 – 1993] 5 N.B.L.R. 172
s 11(1)(a) ............................[1990 – 1993] 5 N.B.L.R. 172
s 88(1) .........................[1990 – 1993] 5 N.B.L.R. 191, 192
Interpretation Act, 1964
s 8........................................[1990 – 1993] 5 N.B.L.R. 287
Interpretation Act Cap 192 Laws of the Federation of
Nigeria, 1990
s 45(1) .................................[1990 – 1993] 5 N.B.L.R. 177
Magistrate’s Court E.R. No. 10 of 1955
s 40..............................[1990 – 1993] 5 N.B.L.R. 178, 179
Moneylenders Law Cap 85 Laws of Lagos State
s 2(c) ...................................[1990 – 1993] 5 N.B.L.R. 289
s 4........................................[1990 – 1993] 5 N.B.L.R. 290
Police Act, 1967
s 4................................[1990 – 1993] 5 N.B.L.R. 193, 194
s 24......................................[1990 – 1993] 5 N.B.L.R. 194
s 24(1) .................[1990 – 1993] 5 N.B.L.R. 172, 193, 194
Second-Tier Foreign Exchange Market Decree No. 23 of
1986
s 15(2)(a) ..[1990 – 1993] 5 N.B.L.R. 34, 35, 52, 347, 361
s 24........................................[1990 – 1993] 5 N.B.L.R. 35
s 24(1) ...................................[1990 – 1993] 5 N.B.L.R. 35
s 24(2) ...................................[1990 – 1993] 5 N.B.L.R. 35

lxvi
 [1990 – 1993] 5 N.B.L.R.

Index of Nigerian Statutes referred to

Second-Tier Foreign Exchange Market Act Cap 405 Law

of the Federation of Nigeria, 1990
s 5(1) ...................................[1990 – 1993] 5 N.B.L.R. 489
s 7........................................[1990 – 1993] 5 N.B.L.R. 489

lxvii
 [1990 – 1993] 5 N.B.L.R.

Index of Foreign Statutes Referred to in the Report

INDEX OF FOREIGN STATUTES

REFERRED TO
Bankers’ Books Evidence Act, 1879
generally .............................[1990 – 1993] 5 N.B.L.R. 178
s 7........[1990 – 1993] 5 N.B.L.R. 169, 175, 184, 187, 188
s 10......................................[1990 – 1993] 5 N.B.L.R. 175

Bills of Exchange Act, 1882

s 82..............................[1990 – 1993] 5 N.B.L.R. 501, 758

lxix
 INDEX OF NIGERIAN RULES OF COURT
REFERRED TO
Court of Appeal Rules, 1981 as amended
Order 3 rule 2(2) .................[1990 – 1993] 5 N.B.L.R. 718
Order 3 rule 2(7) .................[1990 – 1993] 5 N.B.L.R. 262

High Court of Lagos State (Civil Procedure) Rules, 1972

Order 10 rule 1 ...........[1990 – 1993] 5 N.B.L.R. 272, 275
Order 10 rule 2............[1990 – 1993] 5 N.B.L.R. 272, 275

High Court of Oyo State (Civil Procedure) Rules 1978

Order 14 rule 5..............[1990 – 1993] 5 N.B.L.R. 19, 782
Order 14 rule 9....................[1990 – 1993] 5 N.B.L.R. 782

High Court of Ondo State (Civil Procedure) Rules, 1987

- Order 23 rules 1 – 5..........[1990 – 1993] 5 N.B.L.R. 208

lxxi
 INDEX OF FOREIGN RULES
REFERRED TO
English Supreme Court Rules (White Book) 1988 Edition
Order 6 rule 2(4) .................[1990 – 1993] 5 N.B.L.R. 227

lxxiii
 INDEX OF BOOKS REFERRED TO
Aguda, Akinola Law and Practice Relating to Evidence in
Nigeria
pages 168 – 175, para 14 – 06, 14 – 08,
14 – 09 .................................[1990 – 1993] 5 N.B.L.R. 71

Chalmers on Bills of Exchange (13ed)

pages 338 – 339 ..................[1990 – 1993] 5 N.B.L.R. 664
Chitty on Contracts, Specific Contracts (12ed)
page 246, para 2586............[1990 – 1993] 5 N.B.L.R. 231

Chitty on Contracts (24ed) Volume 1

Chapter 2, page 21 ..............[1990 – 1993] 5 N.B.L.R. 402
Chapter 3, pages 63 – 64 ....[1990 – 1993] 5 N.B.L.R. 402

Chitty on Contracts (26ed) Volume 1

page 982, para 1551 ...........[1990 – 1993] 5 N.B.L.R. 667
Chorley, Lord The Law of Banking (6ed)
page 319..............................[1990 – 1993] 5 N.B.L.R. 267

De Smith’s Constitutional and Administrative Law 1973

page 370..............................[1990 – 1993] 5 N.B.L.R. 189
Gatley on Libel and Slander (7ed)
page 103, article 221 ..........[1990 – 1993] 5 N.B.L.R. 650
Gower Modern Company Law (3ed)
page 582..............................[1990 – 1993] 5 N.B.L.R. 600
page 594..............................[1990 – 1993] 5 N.B.L.R. 602

Halsbury’s Laws of England

page 115, para 155 .............[1990 – 1993] 5 N.B.L.R. 790
page 423, para 928 .............[1990 – 1993] 5 N.B.L.R. 707
para 944 ..............................[1990 – 1993] 5 N.B.L.R. 705

lxxv
[1990 – 1993] 5 N.B.L.R.

Nigerian Banking Law Reports

Halsbury’s Laws of England (3ed) Volume 2

page 172, para 322 .............[1990 – 1993] 5 N.B.L.R. 246

Halsbury’s Laws of England (4ed) Volume 3

para 48 ................................[1990 – 1993] 5 N.B.L.R. 271
page 50, para 62 .................[1990 – 1993] 5 N.B.L.R. 651
paras 155, 157,
160 ......................[1990 – 1993] 5 N.B.L.R. 106, 687, 688
para 160 ..............................[1990 – 1993] 5 N.B.L.R. 110

Halsbury’s Laws of England (3ed) Volume 7

para 302 ..............................[1990 – 1993] 5 N.B.L.R. 605
para 366 ..............................[1990 – 1993] 5 N.B.L.R. 594
para 368 ..............................[1990 – 1993] 5 N.B.L.R. 594

Jowitts, Earl Dictionary of English Law

page 1879,
“Without prejudice” ...........[1990 – 1993] 5 N.B.L.R. 448
Kerr on Injunction ................[1990 – 1993] 5 N.B.L.R. 704

McGregor on Damages (14ed)

page 16, para 17 .................[1990 – 1993] 5 N.B.L.R. 231

Megarry’s Note on Quasi Legislation

60 L.Q.R 125, 129 .............[1990 – 1993] 5 N.B.L.R. 591

Orojo Nigerian Commercial Law and Practice, Volume 1

page 364..............................[1990 – 1993] 5 N.B.L.R. 227
Oxford English Dictionary
“Stipulate” ..........................[1990 – 1993] 5 N.B.L.R. 106
Paget’s Law of Banking (8ed)
page 145..............................[1990 – 1993] 5 N.B.L.R. 501

Phipson on Evidence (9ed)

para 599 ................................[1990 – 1993] 5 N.B.L.R. 96
lxxvi
 [1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)

M.F. Aderibigbe v. Inspector-General of Police Nigeria and others 1

a
M.F. Aderibigbe v. Inspector-General of Police
Nigeria and others
b HIGH COURT OF LAGOS STATE
BAKARE J
Date of Judgment: 25 AUGUST 1975 Suit No.: LD/1073/73

c Banking – Freezing of account of customer under Banking

Amendment Decree, 1966 – Banker protected by section 3 of
the Banking Amendment Decree, 1966

Facts
d
The plaintiff seeks against the defendants jointly and sever-
ally a declaration to the effect that the embargo placed upon
the running of his printing business and the operation of his
account with the National Bank Limited by the said defen-
e
dants or either of them is unconstitutional, ultra vires and
void. He also claims against the second and third defendants
jointly and severally the sum of N20,000 as general damages
for their unlawful interference with the operation of his bank
f account and printing business.
Some time in 1972 a case of embezzlement involving a
large sum of N140,000 at the Central Bank, Kano, was re-
ported to the Police. One of the persons suspected by the
g police in connection with the crime was Peter Adeniran, a
relation of the plaintiff who was at the material time the
Senior Supervisor of the said bank.
The suspect was detained by the police. The plaintiff went
h to the Police to arrange bail for the suspect but his request
was refused.
Later, the police searched the house of the plaintiff and
took away some documents. During investigation, the police
i
suspected that part of the missing money had found its way
into the plaintiff’s accounts with the third defendants, the
National Bank of Nigeria Ltd, and that the plaintiff had used
part of this money in purchasing new machines for his print-
j ing business at Ilorin.
[1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)

2 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Acting under the provisions of the Banking Amendment a

Decree, 1966, the first defendant ordered that the account of
the plaintiff with the third defendant be frozen and an em-
bargo was also placed on the new machines. b
At the trial, it was disclosed that the accounts of the plain-
tiff with the third defendant had been de-frozen and that the
embargo on his property at Ilorin had also been removed,
following the discharge of Peter Adeniran in the criminal c
charge preferred against him. The plaintiff denied being in
any way connected with the embezzlement of the money
with which Peter Adeniran was charged.
Section 1(1) of the Banking Amendment Decree, 1966 d
provides as follows:–
“Where the Head of the Federal Military Government has reason-
able cause to suspect that transactions, whether before or after the
commencement of this Decree, in the accounts of persons (herein-
after referred to as ‘the accounts’) with any bank are such as may e
involve the offences of bribery, corruption, extortion or abuse of
office, he may direct the issue of orders addressed to the manager
of the bank where the accounts are, or are believed by him to be,
or in the alternative addressed to the head office of a bank requir- f
ing the bank to prepare or cause to be prepared a record of transac-
tions in the accounts of the persons named in the orders over the
period, not exceeding six years, stated therein; and the manager
shall prepare and certify the record for delivery as required on or
before a prescribed date.” g
Section 3 of the Banking Amendment Decree, 1966 provides
as follows:–
“Where the manager complies with an order made under this De-
cree, or with any direction or requirement thereafter of a bank ex- h
aminer, the bank and all person complying with the order and, as
the case may be, any direction or requirement of a bank examiner,
shall be indemnified from liability to the extent of compliance
therewith, and accordingly no action, claim, suit or demand by or
on behalf of any person whose account is investigated pursuant to i
any such order, shall lie against the bank or any person so comply-
ing with the order.”
By the Banking (Delegation of Powers) Order, 1969 the
power of the Head of Federal Military Government to direct j
 [1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)

M.F. Aderibigbe v. Inspector-General of Police Nigeria and others 3

a the issues of Orders under section 1(1) was delegated to the

Inspector-General of Police.

b Held –
By the provision of sections 3 and 4(2) of the Banking
Amendment Decree, 1966 the defendants could not be liable
in damages.
c
Editorial Note
This case was reported in (1967–1975) 2 N.B.L.R. 618 but
due to a printing error, some pages were omitted. The entire
d case is reproduced in this volume.
Cases referred to in the judgment
Foreign
e Liversidge v. Anderson and another (1942) A.C. 206
R v. Halliday (1917) A.C. 260, 269
The Zamora (1916) 2 A.C. 77, 107
f Nigerian statute referred to in the judgment
Banking Amendment Decree, 1966, sections 1(1), 3 and 4(2)

Counsel
g For the plaintiff: Adigun (holding Akande’s brief)
For the first defendant: Esan
For the second defendant: Awopetu
h For the third defendant: Babalola

Judgment
BAKARE J: The plaintiff’s writ which was filed on the 10th
i October 1973 is indorsed as follows:–
“The plaintiff seeks against the defendants jointly and severally a
declaration to the effect that the embargo placed upon the running
of his printing business and the operation of his account with the
National Bank Ltd by the said defendants or either of them since
j August, 1972 is unconstitutional, ultra vires and void.
[1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)
Bakare J
4 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The plaintiff claims against the 2nd and 3rd defendants jointly and a
severally the sum of N20,000 (£10,000) as general damages for
their unlawful interference with operation of his said bank account
and printing business during the said period.
b
The plaintiff also seeks an order of court abrogating the aforesaid
embargo and also an injunction restraining the said defendants or
either of them from further interference with the plaintiff’s free-
dom to operate his said business and or bank account.
The plaintiff further seeks an order to recover from the 1st defen- c
dant the keys to his printing workshop, the documents relating to
his cutting machine, share certificates, business registration certifi-
cate and other properties taken away by the Police between Au-
gust, and December, 1972 and are still detained by them despite
repeated demands.”
d
The facts as revealed by the pleadings and which are not in
dispute are that sometime in 1972 a case of embezzlement
involving a large sum of N140,000 at the Central Bank,
e
Kano was reported to the police.
One of the persons suspected by the police in connection
with the crime was Peter Adeniran, a relation of the plaintiff
who was at the material time the Senior Supervisor of the f
said Bank. Peter Adeniran was arrested and detained at the
C.I.D. Headquarters Alagbon, Ikoyi.
The plaintiff went to the police to arrange bail for the sus-
pect, but his request was refused. g
On 12th August, 1972 the house of the plaintiff was
searched by the police and some documents were taken
away. In the course of the investigation, the police suspected
that part of the missing money had found its way into the h
plaintiff’s accounts with the third defendants, the National
Bank of Nigeria Ltd, and that the plaintiff had used part of
the money in purchasing new machines for his printing press
at Ilorin. i
Acting under the provisions of the Banking Amendment
Decree, 1966, the first defendant ordered that the account of
the plaintiff with the third defendant be frozen and an em-
bargo was also placed on the new machine. j
 [1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)
Bakare J
M.F. Aderibigbe v. Inspector-General of Police Nigeria and others 5

a Before pleadings were delivered, an application filed on

behalf of the plaintiff “for interim injunction (i) restraining
the first defendant from debarring him from the operation of
b his printing business and (ii) restraining all the defendants
from debarring him from the operation of his account with
the third defendant” was refused by Dosumu J on 28th Janu-
ary, 1974.
c Thereafter, on his application for relief under the said De-
cree, approval was granted to the plaintiff to withdraw a
maximum of N100 per week from the frozen account with
effect from the 24th of April, 1974. Exhibit J refers.
d
It is pertinent to record that at the close of business on the
22nd March, 1974 (while embargo was still in force) the
plaintiff had with the third defendant a fixed deposit balance
of N23,524.40 and a current account credit balance of
e N660,550.

At the trial, it was disclosed that the accounts of the plain-

tiff with the third defendant had been de-frozen and that the
f embargo on his property at Ilorin had also been removed.
In his testimony, the plaintiff disclosed that his account
was de-frozen following the discharge of Peter Adeniran in
the criminal charge preferred against him. The plaintiff
g denied being in any way connected with the embezzlement
of the money with which Peter Adeniran was charged.
The plaintiff stated that he borrowed the money from two
friends whose name he supplied to the police. Under cross-
h
examination, the plaintiff admitted that the cost of the new
machine for the press he purchased was a little over N8,000
and that his fixed deposit of well over N22,000 was made in
one day. The freezing of his accounts was done in the course
i of police enquiry into the Central Bank’s missing money.
The plaintiff stated that he borrowed N29,000 from two
friends between 1971 and 1972 out of which he transferred
N22,000 into the fixed deposit account from his current
j account.
[1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)
Bakare J
6 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Section 1(1) of the Banking Amendment Decree, 1966 a

provides as follows:–
“Where the head of the Federal Military Government has reason-
able cause to suspect that the transactions, whether before or after b
the commencement of this decree, in the accounts of persons
(hereinafter referred to as ‘the accounts’) with any bank are such
that may involve the offences of bribery, corruption, extortion or
abuse of office, he may direct the issue of orders addressed to the
manager of the bank where the accounts are, or are believed by c
him to be, or in the alternative addressed to the head office of a
bank to prepare or cause to be prepared a record of transactions in
the accounts of the persons named in the orders over the period,
not exceeding six years, stated therein; and the manager shall pre-
pare and certify the record for delivery as required on or before a
d
prescribed date.”
By the Banking (Delegation of Powers) Order, 1969 the
power of the Head of the Federal Military Government to
e
direct the issue of orders under section 1(1) was delegated to
the first defendant.
The pertinent question to ask is, was there any reasonable
cause to order investigation of the plaintiff’s accounts? f
In the course of police investigation into the alleged em-
bezzlement, the house of the plaintiff was searched. Docu-
ments were found which showed that he had substantial
amounts in the bank. One Prince Sijuade from whom the g
plaintiff said he borrowed N18,000 admitted loaning this
huge amount to the plaintiff although he was not a financier
and could not produce documents in respect of the said loan.
During the material period, the plaintiff also purchased new h
printing machines worth N8,000.
Can any one say in the circumstances that the suspicion of
the Police that the part of the money alleged embezzled
found its way into the plaintiff’s account was not reason- i
able?
I am satisfied that there was overwhelming evidence to
justify the suspicion and therefore reasonable cause for the
action of the first defendant. j
 [1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)
Bakare J
M.F. Aderibigbe v. Inspector-General of Police Nigeria and others 7

a In Liversidge v. Anderson and another (1942) A.C. 206 (a

case of detention under reg. 18B of the Defence (General)
Regulations, 1939) Lord Macmillan stated at 253–254 as
b follows:–
“I turn now to the nature of the topics as to which the Secretary of
State is under the regulation to have reasonable cause of belief.
They fall into two categories. The Secretary of State has to decide
c (1) whether the person proposed to be detained is a person of hos-
tile origin or associations or has been recently concerned in certain
activities, but he has also to make up his mind, (2) whether by rea-
son thereof it is necessary to exercise control over him. The first of
these requirements relates to matters of facts, and it may be that a
d court of law, if it could have before it all the Secretary of State’s
information – an important ‘if’ – might be able to say whether
such information would to an ordinary reasonable man constitute a
reasonable cause of belief. But how could a court of law deal with
the question whether there was reasonable cause to believe that it
e was necessary to exercise control over the person proposed to be
detained, which is a matter of opinion and policy, not of fact? A
decision of this question can manifestly be taken only by one who
has both knowledge and responsibility which no court can share.
f As Lord Parker said in The Zamora (1916) 2 A.C. 77 at page. 107:
‘Those who are responsible for the national security must be the
sole judges of what the national security requires.’ It would be
obviously desirable that such matters should be made the subject
of evidence in a court of law or otherwise discussed in public.”
g
I may also quote the words of Lord Finlay, L.C. in R v. Hal-
liday (1917) A.C. 260 at 269:–
“It seems obvious that no tribunal for investigating the question
h whether circumstances of suspicion exists warranting some re-
straint can be imagined less appropriate than a Court of law.
The question is one of preventive detention justified by reasonable
probability, not of criminal conviction which can only be justified
i by legal evidence.”

With respect, I adopt the reasoning in the above case for the
view I hold, quite apart from the evidence, of the reasonable
cause to suspect which led to the freezing of the plaintiff’s
j account by the first defendant.
[1990 – 1993] 5 N.B.L.R. (HIGH COURT OF LAGOS STATE)
Bakare J
8 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Although it could be said that police investigation into the a

case of the alleged embezzlement was tardy, it would not be
justifiable to say that there was no reasonable cause for
suspicion which led to the freezing of the plaintiff’s ac- b
counts and the embargo placed upon the running of his
printing business.
In the face of the evidence that the plaintiff’s accounts had
been defrozen and the embargo on his printing press re- c
moved, his claims No. 3 and 4 can no longer stand.
There is yet the claim for damages against the second and
third defendants. Rightly, the two defendants offered no
evidence. d
The third defendant is protected by section 3 of the Bank-
ing Amendment Decree, 1966 which provides as follows:–
“Where the manager complies with an order made under this De- e
cree, or with any direction or requirement thereafter of a bank ex-
aminer, the bank and all persons complying with the order and, as
the case may be, any direction or requirement of a bank examiner,
shall be indemnified from liability to the extent of the compliance
therewith, and accordingly no action, claim, suit or demand by or f
on behalf of any person whose account is investigated pursuant to
any such order, shall lie against the bank or any person so comply-
ing with the order.”
Section 4(2) of the said Decree also protects the bank exam- g
iner.
It follows therefore that the plaintiff is not entitled to the
declaration and injunction sought against the three defen-
dants and his claim for damages against the three defendants h
and his claim for damages against the second and third de-
fendants also fails.
The plaintiff’s claims against the defendants are accord-
ingly dismissed with costs.
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)

J.O. Olasehinde v. African Continental Bank Ltd 9

a
J.O. Olasehinde v. African Continental Bank Ltd
COURT OF APPEAL, IBADAN DIVISION
b AKPABIO, OGWUEGBU, SULU-GAMBARI JJCA
Date of Judgment: 3 MAY 1990 Suit No.: CA/I/129/87

Banking – Banker and customer relationship – Overdraft –

Implied overdraft – Mode of proof
c
Banking – Statement of account – Tendering of – Procedure
– Section 96(2)(e), Evidence Act Cap 112 Laws of the Fed-
eration of Nigeria
d
Facts
The appellant as a customer of the respondent bank main-
tained two current accounts. One of the accounts was oper-
e ated by the appellant in his personal name and the other was
operated in his business name.
The respondent brought two separate suits against the ap-
pellant claiming the sum of N55,995.41k and N61,684.87k
f respectively being the amount of money drawn including
interest, commission and/or other charges on the defendant’s
accounts. The two suits were consolidated for trial.
The appellant in his defence not only denied ever receiving
g any loan or overdraft from the respondent, but also counter-
claimed for a total of N67,125 which he said were amounts
deliberately omitted from being credited into his account
No. 6363 as well as “self debited cheque” paid into said
h account by one Mr Fadina, the erstwhile manager of respon-
dent’s Ife Branch at the material time.
During the trial, the respondent tendered the statement of
account as exhibits C and D. When the appellant wanted to
i tender the statement of account in his possession with which
he intended to prove fraud on the part of the respondent, it
was rejected on the ground that they were not pleaded. There
was also tendered exhibits G–G4 which were letters of com-
j plaint written by the appellant to the Head Office of the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)

10 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

respondent complaining that there were unauthorised debit- a

ing of his accounts by the Branch Manager of respondent’s
bank at Ile-Ife.
At the end of the trial, the learned trial Judge found as a b
fact that all cash lodgements paid into appellant’s account
No. 6363, were duly credited to the said account, and also
that there was no trace or evidence of any “self debited
cheques” paid into any of the appellant’s accounts. On the c
other hand, certified or examined copies of ledger cards in
respect of appellant’s two accounts were duly tendered by
the respondent, and they showed clearly that as at 28th Au-
gust, 1984 the amount claimed by the respondent, was out- d
standing against the appellant in their books. The learned
trial Judge therefore gave judgment in favour of the respon-
dent in the said sum of N117,680.28 plus 10% interest
charged on the judgment debt from the date of the writs up e
till date of judgment, and thereafter a further interest of 5%
charged until the judgment debt was fully paid.
The appellant appealed on the grounds, inter alia, that the f
trial Judge erred in law to have admitted exhibits C and D in
evidence when they were inadmissible by virtue of section
96(1)(h) and 2(e) of the Evidence Act.
Held – g

1. The statement of accounts exhibits C and D were prop-

erly admitted as there was evidence of comparison of
those exhibits with the respondent’s books of account as h
required under section 96(2)(e) of the Evidence Act and
going by the said exhibits C and D without more, the ap-
pellant was clearly indebted to the respondent in the
amount claimed. i
2. The appellant in his statement of defence with counter-
claim did not specifically say that he would tender his
bank statement to prove allegations of “self-debiting
cheques” but that was understood or implied. This is j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)

J.O. Olasehinde v. African Continental Bank Ltd 11

a because, the Rules of Court on pleadings requires a party

to state concisely in numbered paragraphs “the material
facts” of his case on which he relied but “not the evi-
b dence with which those facts are to be proved”.
Clearly the bank statements which were sought to be ten-
dered by the appellant were pieces of evidence and not “ma-
terials facts” which ought to have been pleaded.
c
Appeal allowed. Retrial ordered.

Cases referred to in the judgment

d Nigerian
Anyaebosi v. R.T. Briscoe Ltd (1987) 3 N.W.L.R. (Part 59) 84
N.I.P.C. v. Thompson Organisation Ltd (1969) N.M.L.R. 99
e Oguma v. I.B.W.A. (1988) 1 N.W.L.R. (Part 73) 658
Onyenma v. Amah (1988) 1 N.W.L.R. (Part 73) 772 at 774
Yesufu v. A.C.B. Ltd (1976) 4 S.C. 1

f Nigerian statute referred to in the judgment

Evidence Act (Cap 112) Laws of the Federation of Nigeria,
1990, section 96(2)(e)

g Nigerian Rules of Court referred to in the judgment

High Court of Oyo State (Civil Procedure) Rules 1978,
Order 14 Rule 5

h Counsel
For the appellant: Olujinmi (with him Lajide)
For the respondent: Lawal
i Judgment
AKPABIO JCA: (Delivering the lead judgment) This was an
appeal against the decision of Alao J of the High Court of
Oyo State, holden at Ile-Ife in consolidated Suits No.
j HIF/59/84 and HIF/60/84 dated 30th April, 1986 in which
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
12 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

he found the defendant/appellant liable to the plain- a

tiff/respondent in the sum of N117,680.28, being amount of
overdraft and interest charges etc. granted to the appellant
by respondent at the appellant’s request with N300 costs in b
favour of plaintiff/respondent.
At the trial Court, the respondent originally brought two
separate suits against the appellant as follows:–
In Suit No. HIF/59/84 the plaintiff/respondent claimed the c
sum of N55,995.41k, being the amount of money drawn
including interest, commission and/or other charges by the
defendant on the defendant’s current account No. 0332 with
the respondent’s branch at Ile-Ife, Oyo State, as at 28th d
August, 1984.
In Suit No. HIF/60/84 the sum of N61,684.87 was simi-
larly claimed as amount outstanding on current account No.
6363 as at the same date. e
Account no. 0332 was said to have been operated in his
personal name of “Joseph Olalere Olasehinde”, while ac-
count no. 6363 was operated by him in his business name
and style of “Olalere Joseph Olasehinde Trading Store”. f
Since the appellant was the sole signatory in respect of
both accounts the two suits were consolidated by the court
on an application brought by the plaintiff/respondent on 27th
day of May, 1985. The appellant in his defence not only g
denied ever receiving any loan or overdraft from the respon-
dent but also counter-claimed for a total of N67,125 which he
said were amounts deliberately omitted from being credited
into his account No. 6363 as well as “self debited cheque” h
paid into said account by one Mr Fadina, the erstwhile man-
ager of respondent’s Ife Branch at the material time.
At the end of the trial the learned trial Judge found as a
fact that all cash lodgements paid into appellant’s account i
no. 6363, were duly credited to the said account, and also
that there was no trace or evidence of any “self debited
cheques” paid into any of the appellant’s accounts. On the
other hand, certified or examined copies of ledger cards in j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
J.O. Olasehinde v. African Continental Bank Ltd 13

a respect of appellant’s two accounts were duly tendered by

the respondent, and they showed clearly that as at 28th Au-
gust, 1984 the amount claimed by the respondent was out-
b standing against the appellant in their books. The learned
trial Judge therefore gave judgment in favour of the respon-
dent in the said sum of N117,680.28 plus 10% interest
charged on the judgment debt from the date of the writs up
c till date of judgment, and thereafter a further interest of 5%
charged until the judgment debt was fully paid.
The appellant being dissatisfied with the above judgment
now appealed to this Court on three grounds as follows:–
d
1. The learned Judge erred in law to have admitted exhibits
C and D which are glaringly inadmissible by virtue of
section 96(1)(h) and (2)(e) of the Evidence Act.
e Particulars of Errors
It is trite law that only admissible evidence can be admit-
ted. The High Court admitted inadmissible evidence
f upon which it based its decision.
2. The decision of the learned Judge is against the weight
of evidence.

g 3. The learned Judge erred in law by giving judgment to

the plaintiff which had failed to discharge the onus
placed on it for such judgment.
Briefs of arguments were duly filed and exchanged and
h issues for determination formulated.
The appellant formulated seven issues for determination as
follows:–
i (i) Whether exhibits C and D were properly admitted in
evidence.
(ii) Whether on the materials before the court it could be
said that the respondent satisfactorily made out a case
j in law to entitle it to judgment.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
14 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

(iii) Whether it is open to a trial court to go outside the a

pleadings and the evidence before him in reaching his
decision.
(iv) Whether a party to a case need to plead the evidence b
to establish an averment in his pleading and whether it
is open to a party to tender a document in support of
his case based solely on the pleadings of the other
party. c
(v) Whether a trial court is entitled to make findings of
facts without first evaluating the evidence.
(vi) Whether, where the plaintiff fails in his evidence to d
state the reliefs he is seeking it is open to the court to
make any award in his favour.
(vii) Whether it is open to a trial Judge to carry out his own
private investigation of documents tendered as exhibit e
before him.
The respondent on the other hand formulated as many as
eleven issues for determination as follows:–
f
1. Whether the plaintiff/respondent’s pleadings that the
defendant/appellant (paragraph 4 of the statement of
claim) was granted overdraft facilities cannot include the
fact that the defendant drew a cheque for a sum of g
money in excess of what he had in his account with the
respondent?
2. Whether having regard to the nature of the transaction
between the plaintiff/respondent and the defendant/ h
appellant, and the documents that have transpired be-
tween them, e.g. exhibit B, which initiated the request
for overdraft facilities from the respondent?
3. Whether having regard to the conduct of the respondent i
in not responding to letters of demand and statements of
his accounts, which debited those accounts with various
sums, it can be said that there has been no proof that the
appellant is not owing the respondent? j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
J.O. Olasehinde v. African Continental Bank Ltd 15

a 4. Whether having regard to the fact that P.W1 gave evi-

dence that he compared exhibits C and D with the ledger
before signing them, it can be said that those exhibits
b were not properly admitted under section 96(1)(h) and
(2)(e) of the Evidence Act?
5. Whether the learned trial Judge made any finding not
supported by evidence?
c 6. Whether it is not a mere technical requirement that a
plaintiff should always repeat the reliefs he is claiming
after enunciating the facts and stating the reliefs in his
claim?
d 7. Whether having considered exhibits C and D with exhib-
its B and F among others, it can be said that the respon-
dent has not satisfied the requirement of section 37 of
the Evidence Act?
e
8. Whether there is any need for the respondent to prove
separately the amount on each cheque.
ALTERNATIVELY whether the respondent has not
f proved same as shown in exhibits C and D.
9. Whether the learned trial Judge was wrong in examining
exhibits C and D which were addressed upon by the par-
ties and against which allegation of dubious entries were
g made by the appellant?
10. Whether the statement of account sought to be tendered
by the appellant but rejected by the lower court, was
pleaded?
h 11. Whether in any event, having regard to the enormous
amount involved in this case, the fact that there is a dis-
closure of indebtedness on the part of the appellant to the
plaintiff, the Court of Appeal should not send this case
i back to the High Court for a trial de novo.
I have carefully considered all the evidence adduced in this
case, the pleadings of the parties, as well as the legal argu-
ments of learned Counsel on both sides and find that in spite
j of the multiplicity of issues for determination formulated by
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
16 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

learned Counsel on both sides, there is at the end of the day a

only one principal question for determination in this appeal
which the learned Counsel for the appellant had himself
succinctly stated under “Issues for decision in the lower b
court” at page 2 of his briefs as follows:–
“Based on the pleadings and the evidence the only issues for de-
termination was –
Whether there was satisfactory proof of the amount claimed by
c
the plaintiff from the defendant.”
It was the contention of learned Counsel for the appellant
that there was not sufficient proof of appellant’s indebted-
ness to the respondent because the statements of account
d
exhibits C and D tendered by the respondent to prove their
case were inadmissible because they contravened section
96(1)(h) and (2)(e) of the Evidence Act. Even though the
admission of these exhibits were not opposed at the trial
court, he cited the cases of Yesufu v. A.C.B. (1976) 4 S.C. 1 e
and N.I.P.C. v. Thompson Organisation (1969) N.M.L.R. 99
and submitted that:–
“The court has a duty to reject inadmissible evidence even when
the opposing counsel raises no objection to its admissibility.” f
Two further cases were also cited by learned Counsel for
appellant in the course of the oral argument of this case to
show that it was not sufficient merely to tender ledger cards
in court without also tendering the cheques by means of g
which money were withdrawn or cashed by the defendant.
The cases were (1) Anyaebosi v. R.T. Briscoe Ltd (1987) 3
N.W.L.R. (Part 59) 84 and (2) Oguma v. I.B.W.A. (1988) 1
N.W.L.R. (Part 73) 658. h
Learned Counsel also quarrelled with the way the appel-
lant’s case was handled with levity at the lower court by the
learned trial Judge. Appellant was not allowed to tender the
statements of account in his possession with which he in- i
tended to prove fraud on the part of the respondent on the
untenable ground that they were not pleaded. Learned Coun-
sel for the appellant also referred to exhibits G–G4 which
were letters of complaints written by the appellant to the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
J.O. Olasehinde v. African Continental Bank Ltd 17

a Head Office of the respondent complaining that there were

unauthorised debiting of his accounts by the branch manager
of respondent’s bank at Ile-Ife. Yet the learned trial Judge
b hardly made mention of such exhibits in his evaluation of
the evidence. Last but not the least, he pointed to the fact
that the respondent at the trial court could not tender any
letter of application for loan or overdraft by the appellant,
c leading to the present debit balance. They could also not say
how much of the money now being claimed was principal
and how much was interest, commission and other charges.
In view of all these, he submitted that the respondent did not
prove its case satisfactorily at the lower court and so the case
d
should have been dismissed. He therefore urged this Court
to allow this appeal.
In reply to the above learned Counsel for the respondent
e maintained that exhibits C and D, i.e., the statements of
account prepared by the respondent were properly admitted
and conformed with the provisions of section 96(1)(h) and
(2)(e) of the Evidence Act. He referred to the evidence of
PW1 who testified on oath that he had compared exhibits C
f
and D with the ledger, i.e. book of account of plaintiff’s
bank and found them correct. He cited the case of Yusuf v.
Eruobodo (1979) 2 O.Y.S.H.C. (Part 1) 37 and submitted
that it was enough to tender exhibits C and D to prove the
g case of the respondent. He contended further that if the ap-
pellant disputed the contents of exhibits C and D, he should
have filed what he considered to be the proper statement of
his own account.
h
Regarding the absence of a formal letter of application in
respect of the present overdraft, he submitted that the mere
fact that the appellant signed a cheque to withdraw money
when he knew that he had no money or insufficient money
i to meet such cheques, which cheques were nevertheless
honoured, must be construed to mean an application for an
overdraft. In any case, exhibits B and H were evidence that
appellant requested for overdraft facilities. As regards the
j wrongful rejection of documents which appellant sought to
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
18 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

tender, he submitted that the said documents were not a

pleaded and so could not be accommodated.
In conclusion he urged the court to dismiss this appeal, but
if the court was not minded to do so, the case should be sent b
back for re-trial as a serious/substantial case of debt has
been disclosed against the appellant.
I have carefully considered all the evidence adduced in this
case at the trial court as well as the legal arguments of c
learned Counsel on both sides made both in their briefs and
orally in court and made the following conclusions:–
(1) That the statement of accounts, exhibits C and D, in my
view, were properly admitted as there was evidence of d
comparison of those exhibits with the respondent’s
books of account as required under section 96(2)(e) of
the Evidence Act.
(2) Going by exhibits C and D without more, the appellant e
was clearly indebted to the respondent in the amount
claimed.
However, there seems to have been more than meets the
eyes in this case, because of the series of letters admitted f
and marked as exhibits G–G4, which showed that as early as
14th July, 1980, i.e. even before the present action was insti-
tuted, the appellant had been writing to the Head Office of
respondent’s bank in Lagos, complaining seriously about g
fraudulent or unjustified interference with his account by
one Mr M.A. Fadina, the manager of A.C.B. Ltd, Ile-Ife
Branch. When these complaints appeared to have been fal-
ling on deaf ears, the appellant briefed a lawyer in person of h
one Barrister A.A. Odetunde to handle the matter for him,
and that one wrote exhibits G2 and G4 dated 15th August,
1980 and 3rd June, 1983 respectively. Still there appeared to
have been no reply to any of these letters until the respon- i
dent instituted the present action against the appellant.
Appellant in his defence not only denied being indebted to
the respondent in the amount claimed, but made certain
specific allegations against Mr Fadina, the then branch j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
J.O. Olasehinde v. African Continental Bank Ltd 19

a manager of respondent’s bank at Ile-Ife, and actually

counter-claimed specific amounts. One expected that at the
trial, the appellant would produce his own copies of the
b statement of accounts and show to the court the entries he
alleged to be “self debiting entries”. The appellant in actual
fact sought to do precisely that when at page 43 of records
he sought to tender certain documents as his statement of
c account. But the respondent objected that the said docu-
ments were not pleaded. And most surprisingly the said
objection was upheld by the learned trial Judge. Such a
strategy clearly looked to me as if somebody was trying to
sweep something under the carpet. It is true that the appel-
d
lant in his “Statement of Defence with counter-claim” did
not specifically say that he would tender his bank statement
to prove allegations of “self debiting cheques” but that was
understood or implied. The rules of court on pleadings re-
e
quires a party to state concisely in numbered paragraphs “the
material facts” of his case on which he relies, but “not the
evidence with which those facts are to be proved” (see Order
14 Rule 5 of Oyo State High Court (Civil Procedure) Rules
f of 1978). Clearly the bank statements which were sought to
be tendered by the appellant were pieces of evidence and not
“material facts” which ought to have been pleaded. The
object of pleadings, as is well known, is to prevent a party
g from being taken by surprise. The respondent in its “Reply
to Statement of Defence and Counter-claim” had clearly
stated that it used to send statement of account periodically
to the appellant. It was to be expected then at the trial that
h the appellant would seek to tender some of these “State-
ments” to prove his case. I do not see therefore that the pro-
posed tendering of those statements or any other document
for that matter with a view to proving “false” or “self debit-
i ing,” could be said to have taken the respondent by surprise.
By opposing the tendering of those documents, the respon-
dent had clearly given the impression that it was hiding
something, which may be brought to light if those docu-
j ments were tendered.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
20 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

I should also mention that in spite of the damaging imputa- a

tions made against Mr Fadina in the statement of defence
and Counter-claim of the appellant, the respondent in its
reply made no mention whatsoever about the said Mr b
Fadina, and whether the allegations made against him were
ever investigated by their Head Office, and if so with what
result. In fact, one expected that the respondent would have
called the said Mr Fadina as witness to come and deny under c
oath all the allegations made against him by the appellant.
But they did not do so. It was only in their evidence that
PW1 (Lambart Onwunchumba) said as follows:–
“It is not correct that Mr Fadina, a one time Manager of the plain- d
tiff’s Ile Ife branch made unauthorised self-debited payments of
N6,700.”
To my mind such a statement was at best hearsay, as it
should have come from Mr Fadina, and not from someone e
else. As for the whereabouts of Mr Fadina himself, he was
said to have retired in 1985, on reaching retirement age.
That, in my view could not have prevented him from coming
to testify for the bank if he was duly subpoenaed to come f
and do so. PW1 also stated that Mr Fadina was the manager
of Ile-Ife Branch of the A.C.B. from 1977 to 1979, when the
PW1 was only a clerk at that time.
One Mr Nuru Salami who said he was an accountant of the g
bank at that time also testified as PW2 and made the follow-
ing assertion at page 40 lines 19–24 of the records:–
“I saw the defendant’s petitions as a result of which an Inspector
was sent from the Head Office to the branch office at Ife here to h
audit the accounts. The Inspector invited Mr Olasehinde to our
branch at Ife and he came there to meet him. The Inspector did not
find any fault in the two accounts.”
Here again, apart from the fact that such explanation was i
never pleaded anywhere in the reply to statement of defence
and counter-claim, the said explanation was also hearsay, as
the inspector who actually came to audit the account should
have been called to testify. And of course the witness (PW2) j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
J.O. Olasehinde v. African Continental Bank Ltd 21

a could not remember the name of the auditor, and he did not
also know whether any written report was issued.
The sum total of the above is that the respondent did not
b
make any meaningful and effective defence to the counter-
claim of the appellant. It however succeeded in preventing
him from tendering certain documents which could have
helped him to prove his case if they contained the facts al-
c leged by him. But since he was not allowed to tender them,
one cannot really say whether they could have favoured the
appellant or not. In such a situation, I think that this Court
has a duty to send this case back for the rejected documents
d to be admitted in a retrial, as I hold the view that they were
wrongly rejected.
Even if I say that the respondent had successfully proved
its claim against the appellant, what of the counter-claim?
e
Also even if it was said that no dubious or doubtful entries
were found in the statement of accounts exhibits C and D,
what of “doubtful omissions”. Whether there was or was no
omission would not be known unless one compared exhibits
f C and D, with their equivalent held by the appellant. In my
view, it is necessary that the counter-claim be tried to its
logical conclusion because, if it succeeds, the amount then
owed to the respondent would be considerably reduced, if
g not wiped out altogether. On the authority of the case of
Onyenma v. Amah (1988) 1 N.W.L.R. (Part 73) 772 at 774, I
hold that this is a suitable case to be sent back for retrial. In
that case, the Enugu Division of this Court per Olatawura
h JCA held as follows:–
“An order for retrial inevitably implies that one of the parties, usu-
ally the plaintiff, is being given another opportunity to relitigate
the same matter and certainly before deciding to make such an
i order appellate tribunal should satisfy itself that the other party is
not thereby being wronged to such an extent that there would be a
miscarriage of justice. A retrial is not appropriate where it is mani-
fest that the plaintiff’s case failed in toto and that no irregularity of
a substantial nature is apparent on the records or shown to the
j court (Ayoola v. Adebayo (1969) 1 All N.L.R. 159 referred to).”
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, IBADAN DIVISION)
Akpabio JCA
22 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Having thus applied the warning contained in Amah’s case
(supra) to the facts of this case, I am of the firm view that
the justice of this case can only be met if this case is sent
back for retrial, as already suggested by learned Counsel for b
the respondent himself.
This appeal therefore succeeds and is hereby allowed. The
judgment of the lower court is hereby set aside. In its place,
it is hereby ordered that this case be remitted to the lower c
court for a trial de novo by another Judge of Oyo State High
Court at Ile-Ife. Cost of this appeal is assessed at N300 in
favour of the appellant.
d
SULU-GAMBARI JCA: I entirely agree with the reasons set
out by my learned brother, Akpabio JCA, in his judgment
just read, a preview of which I have had.
I also subscribe to the order of costs as made in the lead e
judgment.
OGWUEGBU JCA: I have read the lead judgment of my
brother, Akpabio JCA, with which I am in complete agree-
ment. There is no doubt that the defence and counter-claim f
of the appellant were not given adequate consideration by
the learned trial Judge.
The appeal is therefore allowed by me. The case is remit-
ted to the High Court of Oyo State, Ile Ife Judicial Division g
for hearing de novo by another Judge with N300 costs in
favour of the appellant.
Appeal allowed, retrial ordered.
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)

African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 23

a
African Continental Bank Limited v.
Obmiami Bricks and Stone (Nig.) Limited
b COURT OF APPEAL, ENUGU DIVISION
UWAIFO, KATSINA-ALU, OGUNTADE JJCA
Date of Judgment: 31 MAY 1990 Suit No.: CA/E/96/89

Banking – Letter of credit – Agreement to open same – Duty

c
of bank discharged once it is opened as agreed – Failure to
communicate confirming bank before particular date –
Plaintiff failing to prove same as sole basis for bank refus-
ing to confirm – Effect of – Bank not liable in negligence or
d for breach of contract for failure to obtain confirmation
before a particular date in the absence of agreement to that
effect

e Practice and procedure – Pleadings – Defendant aware that

letters of credit needed to be confirmed before a particular
date – No agreement to bind the defendant pleaded by plain-
tiff – Admission by defendant is immaterial
f Tort – Negligence – Absence of contract between the parties
– Particulars of negligence pleaded – Effect of
Facts
g The plaintiff obtained an import licence for goods and ma-
chinery and other equipments. It was for an amount of
N1,202,830. It did not have funds. It asked the defendant to
open a letter of credit in favour of a seller KLOSA and
STAAS and also asked for a loan less than the value of the
h
import licence. The defendant eventually approved the sum
of N690,000 upon conditions. It was revealed from the
pleadings and evidence adduced that an agreement to open a
letter of credit by the defendant on behalf of plaintiff had
i been entered into by the two parties on the same day the
letter conveying the approval of the loan was written, that is,
by 19th September, 1986. While action was being taken on
the letters of credit, the law (Decree No. 23 – Second-Tier
j Forex Market Decree, 1986) regarding access to foreign
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)

24 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

exchange was altered and two foreign exchange markets a

(first tier and second tier foreign exchange markets) were
soon to become operative, the first Tier market was cheaper
than the second Tier Market. The transaction of the type for b
which the opening of the letters of credit had been agreed
between the parties would have to be funded from the cost-
lier foreign exchange market if it was not concluded on or
before the last day of the coming into effect of the said law, c
that is before 29th September, 1989.

What this meant was that for a transaction to benefit from

the cheaper market, a confirmed and irrevocable letter of
credit had to be established before the coming into effect of d
the new law. This development only came up after the
agreement to open a letter of credit had already been entered
into by the parties. The date of coming into effect of the law
was also not known until 24th September, 1986 in an ex- e
traordinary Gazette as Government Notice No. 650. The
date was 29th September, 1986. Subsequently the sellers
(KLOSA and STAAS) by a telex message dated 25th Sep-
tember, 1986 to the plaintiffs requested that the letters of f
credit be confirmed by Deutsche Bank in Germany. The
plaintiff contacted the defendant and brought this to its
knowledge, requesting it to send a telex message to
Deutsche Bank to confirm the opening of the letters of g
credit. The defendant eventually sent the telex to Deutsche
Bank on 26th September, 1980 (being a Friday) at about
4.20p.m. The plaintiff alleged that as at that time the con-
firming bank had closed business and so the letters of credit h
could not be confirmed before the coming into effect of the
new law on 29th September, 1986. Its complaint before the
court was that it was the negligence by the defendant that
caused its failure to transact the letter of credit under the
i
cheaper market so they should be responsible for the loss
suffered thereunder by the plaintiff.

The defendant in its statement of defence denied responsi-

bility although at the same time making some admissions of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)

African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 25

a certain averments by the plaintiff. Due to irregularities in the

legal representation, the defendant did not adduce evidence.
Though from the pleadings the plaintiff seemed to have
b founded its action on negligence and pleaded particulars of
same, the learned trial Judge based his judgment on an al-
leged breach of contract and awarded a total sum of
N10,827,305.25 as special damages and dismissed the coun-
c terclaim of the defendant.
The defendant aggrieved, appealed to the Court of Appeal.
Held –
d 1. That the agreement or contract between the parties was
that the defendant/appellant agreed to open an irrevoca-
ble letter of credit and it opened one.

e 2. That the plaintiff/respondent had not shown by evidence

of substance or probative value that Deutsche Bank or
banks in Germany closes business by 4p.m. to support
its claim that the bank (Deutsche Bank) refused to con-
firm the letter solely because of that reason, so the de-
f
fendant/appellant cannot be liable.
3. Since the application by the plaintiff/respondent did not
state that the letter of credit was to be confirmed there
g was no contract between the parties which the defen-
dant/appellant breached or negligently performed to
make it liable in damages for failing to send the telex on
25th September, 1986.
h 4. Though the plaintiff/respondent pleaded particulars of
negligence, it was clear that the action was based on
contract and there was no contract from which the al-
leged tort of negligence could be founded.
i 5. Since the plaintiff only pleaded the fact of an awareness
of the contents of the telex message about the need to
confirm the letters of credit before a particular date and
not that the defendant/appellant agreed to be so bound,
j the mere fact that the defendant/appellant in its statement
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)

26 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

of defence gave an impression that it was so bound does a

not make it liable.
Obiter
b
“If I were however to hold the defendant liable, the amount of
damages would have been the difference in Naira between the cost
of buying foreign exchange from the first and second Tier Foreign
Exchange Markets in respect of later financing the said L.C. This
is partially on the basis that a defendant cannot be liable for dam- c
ages that are too remote. As said by Lord Wright in Liesbock
Dredger v. Edison Steamship (1933) A.C. 449 at 460.”

Per curiam
“The law is that there is need for a plaintiff to give sufficient warn- d
ing of particulars of special damages in the pleading to the defen-
dant so that he may know the case he has to meet. This was so
held in B.E.O.O. Industries (Nigeria) Ltd v. Maduakoh and
another (1975) 12 S.C. 91 at 108 where the Supreme Court ap- e
proved Lord Donovan’s observation in Perestrello E. Companhia
Limitada v. United Paint Co Ltd (1969) 1 W.L.R. 570 at 579.”
Appeal allowed.

Cases referred to in the judgment f

Nigerian
Akinsanya v. United Bank for Africa (1986) 4 N.W.L.R.
(Part 35) 273 g
Alraine (Nig.) Ltd v. M.A. Eshiett (1977) 1 S.C. 89
B.E.O.O. Industries (Nig) Ltd v. Maduakoh and another
(1975) 12 S.C. 91 at 108
h
Khatoun v. Holland West Africa Lines and another (1961)
All N.L.R. 318 at 323; (1961) 2 S.C.N.L.R. 47

Foreign
i
Blackpool Corporation v. Locker (1948) 1 All E.R. 85 at 92
Hadley v. Baxendale (1854) 9 Ex. 341; (1843–1860) All
E.R. Rep. 461
Johnson v. Sargant and Sons (1918) 1 K.B. 101 at 103 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)

African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 27

a Johnson Stansfield and Sons v. Butterworth (1948) 2 E.R.

558 at 564
Perestrello E. Companhia Limitada v. United Paint Co Ltd
b (1969) 1 W.L.R. 570 at 579
Turner v. Stallibrass 67 L.J., Q.B.N.S. 52
United City Merchants (Investments) Ltd v. Royal Bank of
c Canada (1983) 1 A.C. 168

Nigerian statute referred to in the judgment

Second-Tier Foreign Market Decree No. 23 of 1986, sec-
d tions 15(2)(a), 24(1) and (2)

Counsel
For the appellant: Williams, S.A.N. (with him Ibe and Wil-
e liams)
For the respondent: Anyamene, S.A.N. (with him Emole)
Judgment
f UWAIFO JCA: (Delivering the lead judgment) The introduc-
tion into the Nigerian financial system of multiple and dif-
fering foreign exchange markets has made a lot of difference
to business. The rates of exchange are not the same. The
g transition from a single foreign exchange market came about
in September, 1986. It was rather sudden, and consequently
it caused an unusual rush in banking activities within the
short period of transition allowed. This appeal deals with the
h law backing the transition as it affected or tended to affect
the transaction between the parties to open a letter of credit
(LC) at that time.
On 27th April, 1989 at the Enugu High Court, Ozobu J,
i gave judgment in a claim for N22,650,337.50 being special
damages as follows:–
Particulars of special damages
1. Loss of 1,109 metric tons or 22,180 (50kg)
j bags of super-white cement at N70 per bag N 1,552,600
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
28 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

2. Loss of 15,125 kos or 605 (25kg) bags of a

bayerferrox (iron) oxides at N240 per bag N 145,200
3. Demurrage N 194,151.29
4. Interest charged by the defendant on afore- b
said loan to the plaintiff from 24th Septem-
ber 1986 to 31st January, 1989 N 353,138.96
5. Loan from, and accrued interest thereon
charged by Co-operative and Commerce
Bank (Nigeria) Limited N 393,247.25 c
6. Rental for warehouse at Ogbor Hill, Aba N 12,000
7. Loss of profit N 20,000,000
Total N22,650,337.50
d
The learned trial Judge awarded the plaintiff a total sum of
N10,827,305.25 as special damages. The plaintiff seems to
have founded its action on negligence and pleaded the par-
ticulars of the alleged negligence in paragraph 13 of the
e
amended statement of claim. This will be referred to later
and fully considered. But the learned Judge no doubt based
his judgment on an alleged breach of contract as will be
shown. The counter-claim filed by the defendant was at the
same time dismissed. f
The defendant being aggrieved appealed against the judg-
ment. It originally complained on three grounds but these
were later substituted with six grounds. Three issues were
formulated by the defendant for determination by this Court. g
Those issues were accepted by the plaintiff as properly aris-
ing in this appeal. I shall for obvious reasons set out ground
3 and issue 2. They appear to draw attention although I shall
consider the other issues as well. Ground 3 reads:– h
“The Court below erred in law in giving judgment in favour of the
Plaintiff on the ground that the defendant bank is in breach of con-
tract to send out the letter of credit through the telex message on
25/9/86.
i
Particulars of Error
(a) Paragraph 12 of the Statement of Claim bases the claim
of the Plaintiff on the allegation that the defendant ne-
glected to open the letter of credit before the close of
business on 26/9/86. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 29

a (b) the plaintiff’s 3rd witness said on oath that the opening
of the letter of credit was completed around 1 p.m. on
25/9/86.
b (c) no law requires that the opening of the letter must be
communicated to the beneficiary of the credit (KLOSA
and STAAS) or the Confirming Bank (Deutsche Bank)
on 25/9/86 or not later than that date.
(d) the ground aforementioned on which judgment was
c
based was not pleaded and cannot be supported by the
evidence.”
The second question for determination (i.e. issue 2) was then
d stated as follows:–
“Whether the Plaintiff’s case that the Deutsche Bank refused to
confirm the credit issued by the defendant bank solely because of
the fact that the credit so issued was not communicated to KLOSA
and STAAS on 26/9/86 was valid and was the one upon which the
e court below entered judgment in its favour.”
The facts of the case in a nutshell are these. The plaintiff
obtained an import licence for goods and machinery and
f other equipment. It was for an amount of N1,202,830. It did
not have funds. It asked the defendant to open an LC for it
and at the same time for a loan less than the value of the
import licence. The defendant eventually approved the sum
g of N690,000 upon conditions. An agreement to open the LC
would appear to have been reached on the same day the
letter conveying the approval of the loan was written, that is,
19th September, 1986. While action, it seems, was being
taken on the LC, the law regarding access to foreign ex-
h
change was altered and two foreign exchange markets were
soon to become operative. One was cheaper than the other.
The transaction of the type for which the opening of the LC
had been agreed between the parties would have to be
i funded from the costlier foreign exchange market if it was
not concluded on or before the last day of the coming into
effect of the said law. In this particular case a confirmed and
irrevocable LC had to be established if it was to benefit from
j the cheaper market.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
30 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The final step taken by the defendant to have the LC con- a

firmed by a foreign banker (Deutsche Bank of West Ger-
many) suggested at the instance of and upon the pressure by
the plaintiff was on 26th September, 1986 at 4.20p.m. by b
tested telex message (exhibit 1A). That was the last that was
heard of the effort to get the plaintiff to purchase from the
cheaper foreign exchange market. The plaintiff now com-
plains that the defendant was responsible for its failure to c
transact that LC on that market. The goods intended to be
purchased were super white cement and bayerferrox (iron)
oxides said to be needed by the plaintiff for the production of
multi-coloured cast stone bricks for sale. The defendant in its
d
statement of defence denied responsibility although at the
same time making some admissions of certain averments by
the plaintiff. Somehow the defendant did not adduce evidence.
What led to this can be shortly stated. The defendant was e
being defended by Mr U.N. Anya and with him was Mr E.
Ibe. On 14th February, 1989 after plaintiff’s third witness
had testified half way, Mr Anya announced that Mr Ibe
would conduct the case for the defendant and asked to be f
discharged from further participation in the defence. The
court granted the request. Mr Ibe then sought for and was
granted an adjournment. Thereafter he brought an applica-
tion by originating summons before the Chief Judge ques-
g
tioning the propriety of the assignment Order made by the
Chief Judge of Anambra State to enable Ozobu J to con-
clude this case which he had begun before he was posted to
another Judicial Division. He then applied to Ozobu J by
h
motion to stay further proceedings pending the determina-
tion of the originating summons. This was refused. Mr Ibe
then asked to be discharged from the case on 23rd February,
1989. The learned Judge said he would not do that in respect
of that day’s hearing and the plaintiff concluded its case that i
day. Mr Ibe did not appear in that court anymore. He more
or less abandoned the case in a most unethical manner. He
denied his client the opportunity of putting its defence be-
fore the court on a mere technical and untenable objection. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 31

a On the day this appeal was argued, i.e. on 8th March,

1990, Mr Anyamene for the plaintiff applied to amend the
second sentence of paragraph 12 of the amended statement
b of claim to show that the defendant failed to communicate
the opening of the LC to Deutsche Bank before the close of
business on 26th September, 1986. Chief Williams for the
defendant did not oppose on the ground that it would make
c no difference to the case. The amendment was duly granted.
The said paragraph 12 now reads:–
“According to the telex message which the plaintiff received from
KLOSA and STAAS dated 25th September, 1986, contents of
which the plaintiff’s managing director personally brought to the
d knowledge of the defendant, the Deutsche Bank was eager to con-
firm the letter of credit to beat the SFEM deadline if only the de-
fendant acted quickly. Despite this telex message, the defendant
still failed to communicate the opening of the said letter of credit
e to Deutsche Bank before the close of business on the 26th Sep-
tember, 1986.”
It is immediately necessary to refer to paragraph 13 of the
amended statement of claim and reproduce it to make it
f plain what the defendant was alleged to have failed to do, or
neglected to do. The said paragraph reads:–
“On Friday, 26th September, 1986, at about 11 a.m. the plaintiff’s
managing director called at the defendant’s office in Lagos to col-
lect plaintiff’s copy of the telex message of 25th September, 1986,
g prepared by the defendant’s employee one Mr Okonkwo of foreign
business department conveying to Deutsche Bank by telex mes-
sage that the irrevocable letter of credit had been opened in favour
of the plaintiff’s beneficiary KLOSA and STAAS. But after a con-
h siderable waste of time, at about 4 p.m. the defendant informed the
plaintiff’s managing director that a telex message prepared on
25/9/86 was after all not sent out and that the message would be
sent out in the evening. The plaintiff avers that it was negligence
by the defendant that prevented the sending of the message on
i 25/9/86.
Particulars of Negligence
Fully aware as per the exporter’s letter dated 28th August, 1986,
that Deutsche Bank in Frankfurt, Western Germany was eager to
j confirm the letter of credit, the defendant failed to advise the said
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
32 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

bank of the opening of an irrevocable letter of credit and even a

when a telex to that effect was prepared on the 25th September,
1986, the telex message was not sent out on that date, even though
the defendant was aware that SFEM would come into effect on
Monday 29th September, 1986 and that a telex message sent out b
on 26th September, 1986, evening which was Friday could not
reach the addressees till Monday 29th September as 27th and 28th
being Saturday and Sunday respectively were work free days in
Nigeria and in Western Germany.” c
The combined effect of the above paragraphs 12 and 13
shows that the plaintiff asserted the negligence of the defen-
dant as a basis for the damages it suffered in this transaction.
The alleged exporter’s letter of 28th August was not ten- d
dered. Looking at paragraph 8 of the amended statement of
claim, it is plain that it contains the true agreement or con-
tract between the parties. It reads:–
“On the 19th of September, 1986, the defendant undertook the e
duty to establish an irrevocable letter of credit for the importation
of the said raw materials as specified in the pro forma invoice No.
N/1084A/86 of 8th August, 1986, from KLOSA and STAAS, and
in consequence took possession of the original pro forma invoice
f
of KLOSA and STAAS.”
There is no argument that the defendant performed this
contract. What the defendant agreed to open from the said
paragraph 8 was an irrevocable LC. It did open one. Victor g
Kenayo Obiekwe (PW3) said:–
“. . . Mr Okonkwo had the duty of preparing the Letter of Credit,
he prepared it, sent to Mr Okocha who in turn sent it to Mr Akiola
Asst. Controller of Foreign Bureau of the Department. At about h
12.15 p.m. on 25/9/86, we took the Telex Register to Mr Awu-
kuzu, Asst. General Manager Operation who immediately signed
it. From his table the Register was taken to the General Manager
Mr Olie, C.N. for his signature which he did. When everything on
the Letter of Credit was done before 1 p.m. I celebrated because I i
had beaten the Second Tier Foreign Exchange Market (SFEM)
which was to take effect on Monday 29/9/86.”
It is not known in this case all the terms on which the LC
was opened, since the application by the plaintiff to the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 33

a defendant to open the LC was not tendered. It was important

to tender that application because it is said that:–
“A letter of credit comes into being as the result of a formal writ-
b ten application by the applicant, usually the buyer of goods, which
is at the same time a request, a mandate and an indemnity. It re-
quests the banker to issue or ‘open’ the credit, sets out the condi-
tions on which he is to act and holds him covered in respect of his
doing so . . . As the application is the foundation on which the
c credit itself is based it is essential that, in the interests of both
buyer and banker, it should be couched in precise and unambigu-
ous language. It need hardly be added that it should take account
of the practical implications and possible consequences of compli-
ance with the mandate it embodies.”
d
See Paget’s Law of Banking (8ed) page 633. The LC itself
was also not tendered so as to know its terms.
The question of making the said LC confirmed seemed to
e have arisen later. In fact, the letter written by the defendant
to the plaintiff on 19th September, 1986 (exhibit G) shows
that the plaintiff made an application on 16th July, 1986 for
an LC. It was not there mentioned that the credit was to be
f confirmed. The LC opened by the defendant would appear,
however, to be irrevocable. It is No. EN/86/HQ.371/86 for
DM836,002 80. The opening of that LC would seem to have
preceded the telex later sent for it to be confirmed as per
g exhibit 1A, whose opening sentence reads:–
“PLEASE ADVICE AND CONFIRM OUR IRREVOCABLE LC
EN4/86/ HQ.371/86 FOR DM836,002.80 FAVOUR KLOSA and
STAAS AVAILABLE AGAINST PRESENTATION OF THE
FOLLOWING DOCUMENTS FOR NEGOTIATION AT BENE-
h FICIARY’S LOCATION.”
It must be realised that the question of Deutsche Bank com-
ing into the matter as the confirming bank was arranged by
the sellers, KLOSA and STAAS. That arrangement was
i communicated to the plaintiff at its address at Enugu by
KLOSA and STAAS as per telex dated 25th September,
1986 (exhibit L). The said telex reads:–
“THIS IS TO CONFIRM THAT WE CONTACTED DEUTSCHE
j BANK IN GERMANY TODAY AFTER HAVING BEEN
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
34 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

ADVISED BY YOU THAT ACB IS GOING TO RELEASE a

YOUR L/C AS PER OUR NEGOTIATIONS. THEY CON-
FIRMED TO US THEIR READINESS TO ADD THEIR CON-
FIRMATION TO THE L/C AFTER RECEIPT OF SAME
ACCORDING TO TERMS AND CONDITIONS GIVEN TO b
YOU BY LETTER ALREADY. WE HOPE THAT ACB WILL
ACT QUICKLY.”
It seems to me, as I said earlier, that the need to have a con-
firmed irrevocable LC came much later than the time a con- c
tract was reached by the parties for the opening of an
irrevocable LC on 19th September, 1986. At that time it
would appear there was nothing officially known of the
second-tier foreign exchange market (SFEM). The aver- d
ments in paragraphs 9, 10 and 11 of the amended statement
of claim that the defendant then knew of SFEM, and that the
plaintiff had by 22nd September, given it all relevant docu-
ments to take steps to meet the deadline and so qualify under e
the first tier, cannot really be supported by facts. It appears
that the reality of the coming of SFEM was not established
until Decree No. 23 known as Second-Tier Foreign Ex-
change Market Decree, 1986 was published in Lagos on f
24th September, 1986 in an Extraordinary Gazette as Gov-
ernment Notice No. 650. That was when Government notice
of it was legally given to the banks and their customers. At
least no other source of knowledge was pleaded.
g
It was obviously that Decree that made the plaintiff want to
secure confirmation of its LC. It sought to do this by itself
scouting for a confirming banker. It appeared to have got
one through the efforts of the sellers. That was what gave h
rise to exhibit L. It was after exhibit L was received by the
plaintiff (not before 25th September) that pressure was put
on the defendant by the plaintiff to see how the LC would be
confirmed under section 15(2)(a) of Decree No. 23. The
transactions permitted to benefit from the first-tier market i
under the said section 15(2)(a) must ensure that (a) all
documentations prescribed by the Central Bank to be rele-
vant to the transaction concerned were submitted to the
Central Bank; (b) the obligation to which the documentation j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 35

a relates has, having regard to the nature of such transaction,

become due and payable and (c) the corresponding naira
component of the transaction has been deposited with the
b Central Bank, whichever occurs last. As regards the present
case, the plaintiff would benefit from the first-tier market if,
after complying with the above conditions, its transaction
then fulfilled the provisions of section 15(2)(a) which are
c that:–
“. . . any transaction covered by a specific import licence issued in
1985 or 1986 for which a confirmed and irrevocable letter of credit
was established on or before the last day immediately preceding
the commencement of this Decree.”
d
The Decree by itself does not state when its provisions
commenced nor the date they were to commence. Section 24
thereof provides as follows:–
“24 (1) This Decree may be cited as the Second Tier Foreign
e
Exchange Market Decree, 1986.
(2) This Decree shall come into force on such date as the
Minister may, by order published in the Gazette ap-
point.”
f
No such Order of the Minister was tendered before the trial
court or this Court. But I had, in the interest of justice, read
the Gazette in which the Order was published. It is Supple-
ment to Official Gazette Extraordinary No. 59 Volume 73 of
g 25th November, 1986. The Order is Statutory Instrument 25
of 1986 whose date of commencement was 23rd September,
1986. The date of publication, no doubt, created an unusual
situation particularly in respect of a Statutory Instrument.
h
The plaintiff might have given a thought to the actual ef-
fective date of the Statutory Instrument (a delegated legisla-
tion) and made representations to the Central Bank of
Nigeria in the interest of his business instead of blaming the
i defendant since by the very provisions of section 24 of De-
cree No. 23 of 1986 the date of the coming into effect of the
said Decree was to be made known only by publication in
the Gazette. That would seem to suggest that the date of
j publication should in law be the earliest effective date (see
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
36 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Johnson v. Sargeant and Sons (1918) 1 K.B. 101 at 103; a

Blackpool Corporation v. Locker (1948) 1 All E.R. 85 at 92;
Jackson Stansfield and Sons v. Butterworth (1948) 2 All
E.R. 558 at 564, all of which comment on when a delegated b
legislation should ideally come into effect). I do not intend
to say more than that). So in fact it could have at best been a
matter of speculation as to when the Decree would indeed
come into operation at the time the defendant was making c
effort over the confirmation of the LC. It is, in my view a
grave matter to attempt to saddle the defendant with liability
in the circumstances of the publication of that order.
Although evidence was not brought to controvert some d
aspects of PW3’s evidence, for reasons I have earlier given,
it seems to me that it was impossible from the available
evidence for any step to be taken by the defendant to ask
Deutsche Bank to add their confirmation to the LC before e
exhibit L was received. It is most unlikely that PW3 trav-
elled to Lagos on 24th September, as given in evidence by
him in the company of one Njemanze, an official of the
defendant bank, with “all the relevant documents” which
f
were delivered to the defendant bank’s Lagos Office. This is
because KLOSA and STAAS had not then approached
Deutsche Bank and exhibit L had not even come into exis-
tence as at that date. The defendant could not therefore have
gone to Lagos on 24th September, armed with the necessary g
assurance with which to instruct the defendant to telex
Deutsche Bank for confirmation of its LC which “ACB is
going to release”. It seems a fair view to take that the plain-
tiff’s third witness most probably proceeded to Lagos after h
he got exhibit L on 25th September and that he might have
arrived there late.
Anyway, whatever the position, the plaintiff by paragraph
12 of its amended statement of claim (read along with para- i
graph 13) based its cause of action on the failure of the de-
fendant to act quickly on the telex (exhibit L) to beat the
SFEM deadline. The last sentence of paragraph 12 reads:
“Despite this telex message, the defendant still failed to j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 37

a communicate the opening of the said LC to Deutsche Bank

before the close of business on the 26th September, 1986”.
Now, it is of utmost importance that if the defendant is to be
b held liable in that regard, it must be shown by the plaintiff:
(1) that the defendant did not send the telex on the 26th
September, or that it sent it after the close of business that
day by Deutsche Bank; (2) that the defendant was aware that
c Deutsche Bank close their business at 4p.m.; (3) that
Deutsche Bank did not send their confirmation solely on the
ground that the telex got to Germany after 4p.m. (i.e. at
4.20p.m.).
d It has not been shown by evidence of substance or of pro-
bative value that Deutsche Bank or banks in Germany close
business at 4p.m. In this particular case a communication
from Deutsche Bank by way of telex or letter that the telex
e by the defendant got to them too late for their action as their
closing hour was 4p.m. would have been of probative value.
The fact that PW3 said in evidence that banks in West Ger-
many close at 4p.m. does not shift any burden onto the de-
fendant to rebut. Again, it was not pleaded and not given in
f
evidence that the defendant was aware that banks in Ger-
many close at 4p.m. or that they could not act on the day a
telex was sent if sent after 4p.m. It was such a vital and
material fact in the circumstances of this case that it was
g necessary to plead it. Furthermore, there is nothing that can
be relied upon up till now apart from the hearsay contained
in exhibit L that Deutsche Bank was ready to add their con-
firmation. It is also not clear why Deutsche Bank did not act
h having regard to the fact that it would appear that the con-
firmation, as stated in exhibit L, was to have been given
“according to terms, and conditions given to you by letter
already”, since that letter is not in evidence.
i I do not see that the defendant’s liability can be founded on
its failure to send the telex on 25th September, which the
learned trial Judge called a breach of contract. There was no
such contract. I cannot also in all the circumstances come to
j the conclusion that the alleged negligence of the defendant
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
38 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

caused the plaintiff any damage. In fact, it has not been a

proved that the defendant was in breach of any duty it owed
the plaintiff.
I must by way of passing remarks say that the pleading in b
certain aspects are misleading and that some facts may have
been wrongly assumed. I refer to some examples. In para-
graphs 1, 3 and 4 of the statement of claim it is pleaded as
follows:– c
“1. The plaintiff is a limited liability company having its head
office, at No. 1 Rustique Mews (off Rehabilitation Road)
behind Enugu Airport, Emene, Enugu and carries on com-
mercial business of moulding and manufacturing of multi- d
coloured cast stone bricks.
3. In June, 1986 the plaintiff completed the erection of
rustique machineries (sic) and other equipment ready to
commence production of multi-coloured cast stone bricks at
its factory at Emene, Enugu, but the production depended e
on the essential raw materials, namely, super white cement
and bayerferrox (iron) oxides and which could only be im-
ported from overseas.
4. After much expenditure and efforts, on or about 9th May, f
1986, the plaintiff obtained an import licence No.
80V0006496 dated 9th May, 1986 valid for foreign ex-
change to import the said raw materials worth N1,202,830
and specified in the import licence from all countries ex-
cluding South Africa provided such goods were supplied to g
the plaintiff on or before the 31st December, 1986. The
plaintiff will rely on this document during trial.”
The above averments were answered in the statement of
defence as follows:– h
“2. The defendant admits paragraphs 1 and 2 of the plaintiff’s
statement of claim.
3. Paragraph 3 of the statement of claim. The defendant admits
paragraph 3 of the statement of claim to the extent only that i
the defendant was aware of the fact that the plaintiff had
erected plants and machineries (sic) in the factory and was
awaiting raw materials in order to commence production.
But the defendant denies that both Bayer Ferrous oxides
and Super white cement were raw material. Rather only j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 39

a Bayer Ferrous oxides was to be used as raw materials, while

Super white cement was to be sold for money or money’s
worth. This was so stated in the plaintiff’s letter of applica-
tion for the opening of credit addressed to the defendant
b which letter, dated the 16th day of July, 1986, will be
founded upon at the trial of this suit.
5. Paragraph 4 of the statement of claim. The defendant admits
paragraph 4 of the statement of claim to the extent only that
c the plaintiff obtained an import licence dated the 9th day of
May, 1986 and submitted the same to the defendant before
the expired (sic) date of 31st day of December, 1986. But
the defendant humbly would observe that the plaintiff did
not submit the import licence to the defendant until the 16th
d day of July, 1986 when he submitted the same with his ap-
plication for LC and overdraft to finance the purchase of
goods and export expenses.”
The import licence in question was issued on 9th May, 1986
e for, a value of N1,202,830. It was admitted as exhibit F. The
description of the items to be imported for that amount was
as follows:–
“Iron oxides, earth colours containing 70% or more by combined
f weight of iron evaluated as F203 Portland Cement, cement fonder,
slag cement, super sulphate cement and similar hydraulic cements
whether or not coloured or in the form of clinker miami stone
manufacturing machinery, Brick making manufacturing, complete
Rustique Brick manufacturing machinery.”
g The plaintiff in paragraph 3 of its statement of claim gave
the impression that in June, 1986 it had completed the erec-
tion of Rustique machinery and other equipment. The defen-
dant in paragraph 3 of its statement of defence surprisingly
h admitted this. Also in paragraph 4 of the statement of claim
the plaintiff pleaded that the value of the import licence was
for only raw materials. The defendant did not expressly or
impliedly deny this.
i There is no doubt that these averments are misleading. The
import licence dated 9th May, 1986 talks about Rustique
machinery and other machinery. It is quite perplexing that
the plaintiff pleaded that these machines were erected in
j June, 1986, and then pleaded in paragraph 4 that the import
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
40 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

licence was for raw materials worth N1,202,830. This raises a

a query as to what machines were at that time to be used for
the moulding of blocks for sale from super white cement and
bayerferrox (iron oxides) for which so much projected loss b
from sales was claimed as special damages.
I have observed also that some documents and evidence
have not been made available. All these matters have to a
large extent made a determination of this case unduly diffi- c
cult or problematic. But I am satisfied from the evidence
tendered and the Decree that the plaintiff failed to prove that
the defendant acted in breach of contract or was negligent to
cause it damage or loss. If I were however to hold the defen- d
dant liable, the amount of damages would have been the
difference in naira between the cost of buying foreign ex-
change from the first and second-tier foreign exchange mar-
kets in respect of later financing the said LC. This is e
partially on the basis that a defendant cannot be liable for
damages that are remote. As said by Lord Wright in Lies-
bosch Dredges v. Edison Steamship (1933) A.C. 449 at
460:– f
“The law cannot take account of everything that follows a wrong-
ful act; it regards some subsequent matters as outside the scope of
its selection, because ‘it were definite for the law to judge the
cause of causes, or the consequences of consequences. . . . In the
varied web of affairs the law must abstract some consequences as g
relevant, not perhaps on grounds of pure logic, but simply for
practical reasons.”
In other words, I would have disallowed any damages that
were not within the contemplation of the parties at the time h
of the contract: see Hadley v. Baxendale (1854) 9 Ex. 341;
(1843–1860) All E.R. Rep. 461; Alraine (Nig.) Ltd v. M.A.
Eshiett (1977) 1 S.C. 89; or not arising from the alleged
negligence. i
Now, coming specifically to the items of special damages,
the loss of profit should have been particularised in the
pleading so as to give notice to the defendant as to how the
profit of N20,000,000 was arrived at. It is not enough to j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 41

a have stated that figure as part of special damages, as the

plaintiff did, as to do that from the point of view of pleading
is not better than stating an amount as general damages. The
b defendant was entitled to know beforehand how many
blocks would have been moulded from the said raw materi-
als, the cost price of each block or a given quantity thereof
and the selling price. The cost of production would take
c account of all overheads stated in items 1 and 6 of the par-
ticulars of special damages and the difference between this
and selling price would be the profit.
It was therefore vital to have specifically pleaded the pro-
d jected amount of blocks, the cost price and the selling price.
Such particulars cannot properly be revealed in evidence as
was done by PW3 by way of surprise as the defendant could
have been in no position then to controvert them effectively.
e The law is that there is need for a plaintiff to give sufficient
warning of particulars of special damages in the pleading to
the defendant so that he may know the case he has to meet.
This was so held in B.E.O.O. Industries (Nigeria) Ltd v.
f Maduakoh and another (1975) 12 S.C. 91 at 108 where the
Supreme Court approved Lord Donovan’s observation in
Perestrello E. Companhia Limitada v. United Paint Co Ltd
(1969) 1 W.L.R. 570 at 579 as follows:–
g “If a plaintiff has suffered damage of a kind which is not the nec-
essary and immediate consequence of the wrongful act, he must
warn the defendant in the pleadings that the compensation claimed
will extend to this damage, thus showing the defendant the case he
has to meet and assisting him to compute a payment into
h court . . .”
Lord Donovan then went further to deal with the need and
obligation to particularise items of special damages as fol-
lows at pages 579–580:–
i
“The same principle gives rise to a plaintiff’s undoubted obligation
to plead and particularise any item of damage which represents out
of pocket expenses, or loss of earnings, incurred prior to the trial,
and which is capable of substantially exact calculation. Such dam-
j age is commonly referred to as special damage or special damages
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
42 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

but is no more than an example of damage which is ‘special’ in the a

sense that fairness to the defendant requires that it be pleaded.
This obligation to particularise in this latter case arises not because
the nature of the loss is necessarily unusual, but because a plaintiff
b
who has the advantage of being able to base his claim on a precise
calculation must give the defendant access to the facts which make
such calculation possible.”
The matter is clearly stated in Mayne and MacGregor on
Damages (12ed) (1961) at paragraph 970, where the learned c
editors write:–
“Special damages consists in all items of loss which must be speci-
fied by (the plaintiff) before they may be proved and recovery
granted. The basic test of whether damage is general or special is d
whether particularity is necessary or useful to warn the defendant
of the type of claim and evidence, or of the specific amount of
claim, which he will be confronted with at the trial” (italics added
by me).
e
It must be clearly understood from the entire nature of all the
special damages claimed by the plaintiff in items 1, 2, 4, 6
and 7 in this case that it was asking both for the capital and
other overheads he would have incurred in the September,
f
1986 transaction and also for the alleged loss of profit. That
is improper. This is so because if that transaction of Septem-
ber, 1986 had come true (under the First Tier Foreign Ex-
change Market), the plaintiff would have had to pay for the
raw materials, pay demurrage and rental where necessary g
and pay interest on the loan it got from the defendant.
Whether it would have taken up to about two years to re-
pay the loan would have depended on unforeseen contingen-
h
cies. The claim in items 3 and 5 for demurrage and for loan
from the Co-operative and Commerce Bank (Nigeria) Lim-
ited and interest thereon was necessitated by a later LC
opened by the plaintiff. That has nothing to do directly with
the September 1986 transaction since, in any event, apart i
from the LC for September 1986, the plaintiff would neces-
sarily have had to open other LCs for its business under the
Second Tier. So in effect, the plaintiff placed no order that
was paid for as regards the September 1986 transaction. It j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Uwaifo JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 43

a might have missed that opportunity. Therefore all it could

hope to get in an action like this, as an alternative to the
difference computed in naira between the cost of buying
b foreign exchange from the First and Second Tier Foreign
Exchange Markets as I earlier said in this judgment, if prop-
erly asserted and proved as a necessary consequence of that
loss of opportunity, would have been loss of profit and no
other. The plaintiff unfortunately has failed in both alterna-
c
tives, and in all respect it did not claim for the difference in
naira for inability to purchase from the First Tier Foreign
Exchange Market or properly plead and prove loss of profit.
In any event it failed to prove breach of contract or negli-
d gence.
I must however point out by way of emphasis that from the
evidence of PW3, items 3, 4, 5 and 6 are alleged expenditure
or liabilities incurred by the plaintiff on a completely differ-
e ent transaction from the one that failed to materialise in
September, 1986. It is a misconception to think that the
defendant could in any way be held responsible for these
amounts.
f I will accordingly allow this appeal and set aside the judg-
ment of the lower court together with the order for costs. I
dismiss the plaintiff’s claim as being without merit. As re-
gards the counter-claim, there was no basis for dismissing it
g by the lower court when issues had not been joined on it and
no formal ruling was given as to its propriety. The dismissal
is set aside and an order that the counter-claim be placed
back on the cause list for trial is made. I assess costs in fa-
h vour of the defendant at N1,000 in the court below and
N1,500 in this Court.
KATSINA-ALU JCA: I have read in draft the judgment just
delivered by my learned brother, Uwaifo JCA. I am in com-
i plete agreement with his reasoning and conclusion.
In the determination of this appeal it is necessary to estab-
lish the relevant contract between the plaintiff and the de-
fendant. It is now settled that there are four separate and
j distinct contracts which arise from a transaction consisting
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Katsina-Alu JCA
44 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

of an international sale of goods to be financed by means of a

a confirmed irrevocable letter of credit. In United City Mer-
chants (Investments) Ltd v. Royal Bank of Canada (1983) 1
A.C. 168 the House of Lords per Lord Diplock said:– b
“It is trite law that there are four autonomous though intercon-
nected contractual relationships involved. (1) The underlying con-
tract for the sale of goods, to which the only parties are the buyer
and the seller; (2) the contract between the buyer and the issuing
bank under which the latter agrees to issue the credit and either c
itself or through a confirming bank to notify the credit to the seller
and to make payments to or to the order of the seller (or to pay,
accept or negotiate bills of exchange drawn by the seller), against
presentation of stipulated documents; and the buyer agrees to re- d
imburse the issuing bank for payments made under the credit. For
such reimbursement the stipulated documents, if they include a
document of title such as bill of lading, constitute a security avail-
able to the issuing bank; (3) if payment is to be made through a
confirming bank the contract between the issuing bank and the e
confirming bank authorising and requiring the latter to make such
payments and to remit the stipulated documents to the issuing
bank when they are received, the issuing bank in turn agreeing to
reimburse the confirming bank for payments made under the
credit; (4) the contract between the confirming bank and the seller f
under which the confirming bank undertakes or pay to the seller
(or to accept or negotiate without recourse to drawer bills of ex-
change drawn by him) up to the amount of the credit against pres-
entation of the stipulated documents.” g
See also Akinsanya v. United Bank for Africa (1986) 4
N.W.L.R. (Part 35) 273.
I agree with Chief Williams for the defendants that the in-
stant appeal is directly concerned with the second contract, h
i.e. the contract between the plaintiffs herein and their
banker – the defendant herein.
Paragraph 8 of the amended statement of claim and para-
graph 11 of the statement of defence seek to show that there i
was a contract for the opening of an irrevocable letter of
credit. Paragraphs 8 reads as follows:–
“8. On the 19th of September, 1986, the defendant undertook
the duty to establish an irrevocable letter of credit for the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Katsina-Alu JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 45

a importation of the said raw materials as specified in the pro

forma invoice No. N/1084A/86 of 8th August, 1986, from
KLOSA and STAAS, and in consequence took possession
of the original pro forma invoice of KLOSA and STAAS.”
b
And paragraph 11 of the statement of defence reads:–
“11. The defendant admits paragraph 8 of the statement of claim,
to the extent only that in its normal course of duty it com-
c menced to establish irrevocable letter of credit on satisfying
itself that the preliminary requirements for opening of ir-
revocable letter of credit such as the funds and the pro
forma invoice have been met by the plaintiff.”

d There is no doubt that the defendant admitted entering into

an agreement with the plaintiff to open a letter of credit in
favour of the plaintiff’s overseas supplier KLOSA and
STAAS. This agreement was concluded on 19th September,
e 1986. The question therefore is whether the defendants per-
formed their part of the contract.
Victor Kanayo Obiekwe was the managing director of the
plaintiff company. He gave evidence as PW3. Part of his
f testimony reads:–
“. . . Mr Okonkwo has the duty of preparing the letter of credit,
he prepared it, sent to Mr Akinola Asst. Controller of Foreign Bu-
reau of the department. At about 12.15 p.m. on 25/9/86 we took
g the Telex Register to Mr Awukuzu, Asst. General Manager Opera-
tion who immediately signed it. From his table the Register was
taken to the General Manager Mr Olie C.N. for his signature
which he did, when everything on the letter of credit was done
before 1p.m. I and some staff of the defendant company began to
h celebrate.”
The evidence of PW3 Victor Obiekwe shows that a letter of
credit was in fact issued before 1p.m. on 25th September,
1986. On the opening of the letter of credit the defendants
i had performed their part of the contract. The defendant
herein was then obligated merely to notify KLOSA and
STAAS (the seller) either itself or through a confirming
bank, in this case the Deutsche Bank suggested by the plain-
j tiffs. It follows therefore that the defendant having sent a
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Katsina-Alu JCA
46 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

telex to inform Deutsche Bank owed no further duty as a

whether to ensure that the plaintiff was able to pay the seller
(KLOSA and STAAS) on the First Tier Foreign Exchange
Market. It must be remembered that under the second con- b
tract indicated in the Royal Bank of Canada’s case, the de-
fendant in law is not to act within a time schedule to notify
the confirming bank.
But the plaintiff’s case is premised on an alleged contrac- c
tual obligation on the part of the defendant to ask Deutsche
Bank to confirm the letter of credit on or before 26th Sep-
tember, 1986. Indeed it is their case that the relevant con-
tract concluded before 1p.m. on 25th September, 1986 was d
not communicated to the confirming bank before 4p.m. on
26th September, 1986 which was a Friday. See paragraph 12
of the statement of claim which reads as follows:–
“12. According to the telex message which the plaintiff received e
from KLOSA and STAAS dated 25th September, 1986,
contents of which the plaintiffs Managing Director person-
ally brought to the knowledge of the defendant, the
Deutsche Bank was eager to confirm the letter of credit to
beat the SFEM deadline if only the defendant acted quickly. f
Despite this telex message, the defendant still failed to
communicate the opening of the said letter of credit to
Deutsche Bank before the close of business on the 26th
September, 1986.”
g
I have already indicated that the agreement to issue a letter
of credit was reached on 19th September, 1986. No where in
paragraph 8 was it ever stated that the defendant undertook
to ask Deutsche Bank to confirm the letter of credit on or
h
before 26th September, 1986. It must be pointed out that the
parties did not have the Second Tier Foreign Exchange Mar-
ket Decree No. 23 of 1986 in their contemplation when they
entered into this contract. The decree itself was published on
24th September, 1986 and came into force on 29th Septem- i
ber, 1986. A careful perusal of paragraph 12 of the statement
of claim will show that the case put forward was not that
there was any such contract but only that the defendant was
aware that the Deutsche Bank was eager to confirm j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Katsina-Alu JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 47

a the letter of credit “to beat the SFEM deadline if only the
defendant acted quickly”.
There indeed was no such contract. The plaintiffs could not
b have known of the SFEM Decree before it was promulgated
on 24th September, 1986. And the telex message certainly
did not form part of or vary the contract into which the par-
ties had already entered. More than that the telex message
c indicating readiness to confirm was not from Deutsche Bank
but from a third party. It constituted no more than hearsay
evidence. There is nothing other than that hearsay (which is
no evidence at all) that Deutsche Bank had agreed to con-
d firm. Therefore I also hold that there was no breach of con-
tract on the part of the defendant.
I am also in complete agreement with the views on dam-
ages. I too dismiss the appeal with costs as assessed and
e abide by the order in respect of the counter-claim.
OGUNTADE JCA: This case raises some difficulties arising
mainly from the poor presentation of the defendant/
appellant’s case on the pleading. It seems to me that a
f pleader must ensure that he does not through a careless and
imprecise pleading lead the court into a situation where the
pleading is taken as making an admission of a fact when
such fact has only been half-heartedly or ambivalently
g pleaded by his adversary. This is the more so where the
statement that smacks of an admission is equally consistent
with a true admission of an adversary’s pleading as it is with
a denial of it. This in my view is what has happened in this
case.
h
The plaintiff’s claim as framed before the lower court
would appear to be founded on the negligent performance of
a duty arising from a contract by the defendant/appellant. It
was a claim in contract and not on the tort of negligence as
i
some of the averments in the plaintiff’s amended statement
of claim would appear at first to suggest (see Khatoun v.
Holland West Africa Lines and another (1961) All N.L.R.
318 at 323; (1961) 2 S.C.N.L.R. 47 and Turner v. Stallibrass
j 67 L.J. Q.B.N.S. 52).
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Oguntade JCA
48 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The first thing to do is to identify the contract, a breach of a

which the plaintiff sued upon.
In paragraphs 8, 9, 10, 11 and 12 (as amended before this
Court) and 13 of the statement of claim, the plaintiff pleaded b
thus:–
“8. On the 19th September, 1986, the defendant undertook the
duty to establish an irrevocable letter of credit for the im-
portation of the said raw materials as specified in the pro c
forma invoice No. N/1084A/86 of 8th August, 1986, from
KLOSA and STAAS, and in consequence took possession
of the original pro forma invoice of KLOSA and STAAS.
9. The second tier foreign exchange market (SFEM) was to
come into operation on the 29th September, 1986 and only d
confirmed letter of credit completed before that date would
be transacted under the first tier market while others from
that date would be under the second tier market which is
costlier than the first tier. The defendant was aware of this
fact and also that several importers and banks were expedit-
e
ing actions so as to beat that date and benefit from the first
tier market.
10. The plaintiff promptly complied fully with the terms and
conditions stipulated in the defendant’s letter of undertaking f
dated 19th September, 1986.
11. Although the defendant was aware that the second tier
foreign exchange market (SFEM) would come into opera-
tion on Monday 29th September, 1986, and all relevant
documents were submitted to the defendant’s branch office, g
Enugu, on or before Monday, 22nd September, 1986, to en-
able the branch office to prepare all relevant documents in
good time to meet the deadline, the defendant neglected to
take the necessary steps to beat the said deadline. h
12. According to the telex message which the plaintiff received
from KLOSA and STAAS dated 25th September, 1986,
contents of which the plaintiff’s managing director person-
ally brought to the knowledge of the defendant, the
Deutsche Bank was eager to confirm the letter of credit to i
beat the SFEM deadline if only the defendant acted quickly.
Despite this telex message, the defendant still failed to
communicate the opening of the said letter of credit to
Deutsche Bank before the close of business on the 26th
September, 1986. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Oguntade JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 49

a 13. On Friday, 26th September, 1986, at about 11a.m. the

plaintiff’s managing director called at the defendant’s office
in Lagos to collect plaintiff’s copy of the telex message of
25th September, 1986, prepared by the defendant’s em-
b ployee, one Mr Okonkwo of foreign business department
conveying to Deutsche Bank by telex message that the ir-
revocable letter of credit had been opened in favour of the
plaintiffs beneficiary KLOSA and STAAS. But after a con-
c siderable waste of time, at about 4p.m. the defendant in-
formed the plaintiff’s managing director that a telex
message prepared on 25/9/86 was after all not sent out and
that the message would be sent out in the evening. The
plaintiff avers that it was negligence by the defendant that
d prevented the sending of the message on 25/9/86.”

A close examination of the above extracts from plaintiff’s

amended statement of claim reveals that the plaintiff had
only pleaded one contract made on 19th September, 1986,
e by which the defendant/appellant agreed to open a letter of
credit for the plaintiff in favour of KLOSA and STAAS in
West Germany. According to the pleading, it was only on
25th September, 1986, six days after the pleaded contract
f that the plaintiff’s managing director brought a telex mes-
sage to the attention of the defendant/appellant, the sub-
stance of which is that the Deutsche Bank would confirm a
letter of credit in favour of the sellers if one was communi-
g cated to it (Deutsche Bank) before the close of business on
26th September, 1986. It was never pleaded that the defen-
dant/appellant agreed that it would communicate the letter of
credit to Deutsche Bank before 26th September, 1986. All
h that the plaintiff pleaded was the knowledge or an awareness
of the contents of the telex message. Not that the defen-
dant/appellant agreed to be so bound.
In the principle of pleading, it is settled that a defendant
i could only admit a fact pleaded by a plaintiff. If the plaintiff
did not plead a contract, it is unexpected and indeed unac-
ceptable that the defendant would admit the existence of a
contract not pleaded. It is the plaintiff that nominated the
j issues for adjudication in a civil case and not vice versa
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Oguntade JCA
50 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

unless the defendant has a counter-claim. As the plaintiff did a

not plead the existence of another contract made on 25th
September, 1986, it was not therefore open to the defen-
dant/appellant to admit that such a contract existed. b
However, the defendant/appellant in paragraphs 18, 19 and
19(a) of the amended statement of defence pleaded thus:–
“18. Paragraph 12 of the statement of claim. The defendant
denies paragraph 12 of the Statement of Claim and states c
that it is not true that the letter of credit was not opened on
the 25th day of September, 1986. The defendant opened a
letter of credit on the 25th day of September, 1986 and
communicated the same to the Deutsche Bank the same
day. It is not the duty of the defendant to inform a benefici- d
ary of the letter of credit that its letter of credit has been es-
tablished and opened. It is the duty of the advising or
correspondent bank and in this case Deutsche Bank which
is to advise the supplier and in this case Klosa and Staas. e
19. Paragraph 13 of the statement of claim. The defendant
denies in the strongest terms paragraph 13 of the statement
of claim and the plaintiff is put to the strictest proof thereof.
19 (a) In further answer to paragraph 13 of the Statement
f
of Claim. The defendant avers that it made it clear
to the plaintiff that the defendant could not guaran-
tee any line or lines of credit and that the defendant
could not therefore be held liable in any manner
whatsoever for non-confirmation of the letter of g
credit. This was initially agreed upon between the
plaintiff and the defendant and the agreement was
put into writing in a document dated 24th day of
September, 1986. The document will be relied
upon at the trial of this suit” (italics mine). h
The impression one gets by reading paragraph 18 of the
amended statement of defence is that the defendant/appellant
had by contract bound itself to send Deutsche Bank a telex
message concerning the letter of credit issued at the instance i
of the plaintiff in favour of KLOSA and STAAS before the
close of business on 26th September, 1986. This is because
the defendant/appellant pleaded that it actually did so. This
by itself would suggest that the defendant had admitted the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Oguntade JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 51

a averment in paragraph 12 of the amended statement of

claim.
In United City Merchants (Investments) Ltd v. Royal Bank
b of Canada (1983) 1 A.C. 168, Lord Diplock discussed the
four autonomous though interconnected contracts which can
arise from a transaction upon a confirmed letter of credit. He
referred to the second of such contracts thus:–
c “The contract between the buyer and the issuing bank under which
the latter agrees to issue the credit and either itself or through a
confirming bank to notify the credit to the seller and to make pay-
ments to or to the order of the seller (or to pay, accept or negotiate
bills of exchange drawn by the seller) against presentation of stipu-
d lated documents; and the buyer agrees to reimburse the issuing bank
for payments made under the credit. For such reimbursement the
stipulated documents, if they include a document of title such as
bill of lading, constitute a security available to the issuing bank”.
e See Akinsanya v. United Bank for Africa Ltd (1986) 4
N.W.L.R. (Part 35) 273.
The type of contract referred to in above passage by Lord
Diplock is the one used by the parties in this case. So that,
f the defendant/appellant would ordinarily have the duty to
notify the sellers, KLOSA and STAAS, or Deutsche Bank
(sellers’ agent) of the opening of the letter of credit. The
defendant/appellant would not ordinarily have the duty to
g notify either the sellers or the agent on a particular date.
Judicial authorities would appear to suggest however that
this should be done within a reasonable time as would not
frustrate the commercial purpose of the transaction.
h As I said earlier, the defendant/appellant pleaded that it
notified Deutsche Bank of the opening of the letter of credit
by telex on 25th September, 1986. In the contract properly
pleaded by the plaintiff, it would be immaterial if the defen-
i dant had sent the notification a week later than it did since it
would still have thus fulfilled its contractual duty to open a
letter of credit in favour of KLOSA and STAAS.
But the date 26th September, 1986 assumed decisive im-
j portance in this case on the pleadings and evidence only by
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Oguntade JCA
52 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

reason of section 15(2)(a) of the Second Tier Foreign Ex- a

change Market Decree, 1986 published on 24th September,
1986 which provides:–
“. . . any transaction covered by a specific import licence issued in b
1985 or 1986 for which a confirmed and irrevocable letter of credit
was established on or before the last day immediately preceding
the commencement of this Decree.”
The case of the plaintiff is that it was forced to purchase c
foreign exchange for the transaction with KLOSA and
STAAS on the second tier at a rate higher than it would have
paid if the defendant/appellant had notified Deutsche Bank
of the letter of credit before 26th September, 1986. d
The evidence before the lower court from PW3 is that the
defendant/appellant did not open the letters of credit on 25th
September, 1986. That being so the defendant/appellant who
did not by the contract made on 19th September, 1986 have e
any obligation to notify the sellers or their agents on a par-
ticular date would appear not to be in breach of that contract
and since the plaintiff had not pleaded any other agreement
whereby the defendant/appellant had agreed to send a notifi- f
cation to Deutsche Bank on or before 26th September, 1986,
the mere fact that the defendant/appellant pleaded that it sent
a notification on 25th September, 1986 would not bring into
existence a contract not shown by plaintiff to exist. g
This is the major misfortune of the plaintiff’s case. It is
such that, one can say, that even at the close of pleadings,
the plaintiff’s case had as conceived been destined to fail.
The plaintiff would need to plead and prove this new con- h
tract (taking the pleaded contract of 19th September, 1986 as
the old contract) in order to succeed. Not having pleaded it,
the question of liability of the defendant/appellant could not
arise. i
The truth of the matter is that even if the defendant/
appellant had seen the contents of the telex message, exhibit
17, the defendant/appellant’s awareness of the situation
mentioned in the exhibit is not the same thing as saying that j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, ENUGU DIVISION)
Oguntade JCA
African Continental Bank Ltd v. Obmiami Bricks and Stone (Nig.) Ltd 53

a the defendant/appellant was bound to accommodate that

situation one way or the other. A banker must be expected to
have at heart the interest of its customers. But a banker is not
b an insurer of the occurrence of an event in respect of which
it has not bound itself by contract.
The judgment of my learned brother, Uwaifo JCA, has
dealt with the question of damages payable to the plaintiff.
c In the event I am held wrong in my views as to the liability
of the defendant/appellant, I fully endorse his views on the
question of damages and adopt them as mine. I think the
damages awarded can be faulted on the ground of their re-
d moteness. Assuming that I had been able to hold the appel-
lant liable I would not have awarded more than the
difference between the cost of purchasing plaintiff’s/
respondent’s goods on the SFEM rate and purchasing the
e same goods on the second tier rate.
I would allow this appeal with costs as in the lead judg-
ment. I also agree that the counter-claim was wrongly dis-
missed. I make an order setting aside the order dismissing
f the counter-claim. It is ordered that the counter-claim be
placed back on the cause list for normal trial.
Appeal allowed.
Re-trial ordered for counter-claim.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

54 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Highgrade Maritime Services Limited v. First Bank

of Nigeria Limited
b
SUPREME COURT OF NIGERIA
WALI, BELGORE, KARIBI-WHYTE, KAWU, OBASEKI JJSC
Date of Judgment: 18 JANUARY 1991 Suit No.: SC. 211/1988

Banking – Bank fraud – Onus of proof – On whom lies c

Banking – Cheque – Purpose
Banking – Witnesses – Sections 90(3) and 148(d) of the
Evidence Act Cap 112 Laws of the Federation of Nigeria,
d
1990 – Construction and purport of
Evidence – Person interested under section 90(3) of the
Evidence Act Cap 112 Laws of the Federation of Nigeria,
1990 – Who is – What determines e
Evidence – Proof – Burden of proof in civil cases – Allega-
tion of crime in civil cases – Standard of proof needed
Words and phrases – Cheque – Meaning and purpose of
f
Facts
The appellant as plaintiff before the lower court opened a
current account with the respondent on 10th August, 1983 g
with the sum of N100 at the respondent’s Airport Branch,
Port Harcourt. Subsequent to the opening of the aforesaid
current account, the appellant on 11th August, 1983 lodged a
First Bank of Nigeria cheque for the sum of N1,568,946.35
h
drawn by Parkinson Nigeria Limited on Ikeja Branch of the
same bank, i.e. First Bank, into his newly opened current
account at Airport Branch, Port Harcourt. The appellant’s
account was subsequently credited with the value of the
cheque on the same day and because of the large sum in- i
volved and in accordance with banking practice the same
account was equally debited with the same amount stated on
the lodged cheque. The cheque was thereafter sent to Ikeja
branch of the respondent for collection and to ascertain the j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 55

a genuineness of same. The Ikeja branch contrary to banking

practice for amount over N2,000 through mere paper trans-
action rather than through a coded telegram informed
b the respondent that payment had been effected on the
cheque. The unusual manner in which Ikeja Branch advised
payment prompted the respondent to suspect fraud on
the cheque and sent another telegram to Ikeja branch to
c confirm whether exhibits 12 and 12A relating to the cheque
as well as the signature thereon originated from Ikeja, and
also, whether Parkinson Nigeria Limited alleged to have
drawn the cheque had account with Ikeja Branch of the
d respondent. The Ikeja branch responded by denying that
exhibits 12 and 12A ever originated from them, and that the
signature on the exhibits were forged, and also, that the
drawer of the cheque, Parkinson Limited, had no account
e with the branch.
After verifying the genuineness or otherwise of the cheque,
the appellant’s managing director, one Benedict Ume, sub-
sequently came to the respondent branch with a cheque in
f order to withdraw the sum of N63,000 from the appellant’s
account on the strength of the questionable cheque ascer-
tained to be forged. The respondent then invited the police
and the appellant’s managing director was arrested and
g subsequently detained. At the time of the arrest, appellant’s
Managing Director had only N19.50 to his credit in the said
account.
The appellant subsequently instituted an action at Port
h Harcourt High Court against the respondent claiming the
sum of N1,568,966.35 as money had and received by the
respondent on behalf of the appellant and which the respon-
dent failed to pay to the appellant despite repeated demands.
i The respondent denied liability for the appellant’s claim and
the matter proceeded to trial. The trial Judge gave judgment
in favour of the appellant. On appeal to the Court of Appeal,
the judgment was reversed. The appellant thereafter ap-
j pealed to the Supreme Court.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

56 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Held –
1. A cheque in strict sense is an order or request for pay-
ment. Until the cheque is honoured or cleared and the b
amount stated on it paid, it is not money.
2. It is trite law that where fraud is alleged, it must be spe-
cifically pleaded and particulars of the fraud given to en-
able the party defending the allegation understand the c
case he is facing and prepare his defence.
3. By virtue of section 90(3) of the Evidence Act, no state-
ment made by a person interested at a time when pro-
ceedings were pending or anticipated involving a dispute d
as to any fact which the statement might tend to establish
is admissible in evidence. This provision excludes
documents made in anticipation of litigation by a person
not personally interested. Therefore, the law is that a e
document made by a party to a litigation or a person oth-
erwise interested when proceedings are pending or an-
ticipated is not admissible. The disqualifying interest is a
personal not merely interest in an official capacity. f
Where, however, the interest of the maker is purely offi-
cial or as a servant without a direct interest of a personal
nature, the document is not thereby excluded.
4. Section 148(d) of the Evidence Act deals with failure to g
call evidence and not failure to call a particular witness
where a party can prove his case without calling such
witness.
5. In civil cases, the onus of proving a particular fact is h
fixed by the pleadings. It does not remain static, but
shifts from side to side. The correct position of the law is
that the onus of adducing further evidence is on the per-
son who would fail if such evidence was not produced. i
On the other hand, where the commission of crime is di-
rectly in issue, the party alleging must prove it beyond
reasonable doubt.
Appeal dismissed. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 57

a Cases referred to in the judgment

Nigerian
Abinabina v. Enyimadu 12 W.A.C.A. 171
b
Agbonifo v. Aiwerioba (1988) 1 N.W.L.R. (Part 70) 325
Akinola v. Oluwo (1962) 1 S.C.N.L.R. 352
Akpor v. Iguoriguo (1978) N.S.C.C. 1115
c
Amida v. Oshoboja (1984) 7 S.C. 68
Aouad v. Nzimiro 10 W.A.C.A. 73
Ebba v. Ogodo (1984) 1 S.C.N.L.R. 372
d Ekpoke v. Usilo (1956) 6–7 S.C. 187
Fatoyinbo v. Williams (1956) S.C.N.L.R. 274
Ikoku v. Oli (1962) 1 S.C.N.L.R. 307
e Johnson v. Maja 13 W.A.C.A. 290
Nigerian Maritime Service Ltd v. Afolabi (1978) 2 S.C. 79
Okafor v. Idigo (1984) 1 S.C.N.L.R. 481
f Okolo v. Uzoka (1978) 4 S.C. 77
Okpiri v. Jonah (1961) 1 S.C.N.L.R. 174
Okuoja v. Ishola (1982) 7 S.C. 314
Olukade v. Alade (1976) 1 All N.L.R. (Part 1) 67
g
R v. Iregbu (1938) 4 W.A.C.A. 32
U.A.C. v. Taylor 2 W.A.C.A. 67
Woluchem v. Gudi (1981) 5 S.C. 291
h
Foreign
Barkway v. South Wale Transport Co Ltd (1949) 1 K.B. 54
Bearmans Ltd v. Metropolitan Police District Receiver
i
(1961) 1 W.L.R. 634
Evon v. Noble (1949) 1 K.B. 222
Galler v. Galler (1955) 1 W.L.R. 500
j Re Powe, Powe v. Barclays Bank Ltd P. 110
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

58 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Nigerian statute referred to in the judgment a

Evidence Act (Cap 112) Laws of the Federation of Nigeria,
1990, sections 90(3), 135, 137, 138 and 148(d)
b
Book referred to in the judgment
Aguda Law and Practice Relating to evidence in Nigeria,
pages 168–175, paragraphs 14–06, 14–08, 14–09
c
Counsel
For the appellant: Muoma
For the respondent: Anyamene, S.A.N. (with him Obutte
(Mrs)) d

Judgment
WALI JSC: (Delivering the lead judgment) On 22nd Octo-
ber, 1990, I dismissed this appeal and indicated to give my e
reasons for doing so today. By a Writ of Summons filed in
the High Court of the Port Harcourt Judicial Division on
17th October, 1983, the plaintiff, High Grade Maritime
Services Limited, claimed against the defendant, First Bank f
of Nigeria Limited, situate at Aba Road, Port Harcourt, as
follows:–
“The plaintiff’s claim against the defendant is the total sum of
N1,568,966.35 (One Million, Five Hundred and Sixty-eight Thou- g
sand, Nine Hundred and Sixty-six Naira, Thirty-five Kobo) being
money had and received by the defendant to the use of the plaintiff
at Port Harcourt within the jurisdiction of this Honourable Court in
the course of the defendant’s business as a banker and in respect of
the plaintiff’s Current Account No. 02025984 with the defendant’s h
branch at Aba Road, Port Harcourt, commonly or popularly known
as the Airport Branch.
The plaintiff has closed the said account with the defendant and
demanded the aforesaid sum of money, being the balance standing i
to the plaintiff’s credit in the said account.
The defendant has since failed and still refused to comply with the
plaintiff’s demand aforesaid.
WHEREOF the plaintiff has suffered damage and claims against
the defendant the said debt or liquidated sum of N1,568,966.35 j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 59

a (One million, Five Hundred and Sixty-eight Thousand, Nine Hun-

dred and Sixty-six Naira, Thirty-five Kobo) being money had and
received by the defendant to the use of the plaintiff.”
b The defendant denied the plaintiff’s claim. Pleadings were
ordered, filed and exchanged and issues joined on material
facts. At the end of the hearing of the case, the learned trial
Judge, Fiberesima J, delivered a reserved judgment in which
c he concluded:–
“From the evidence before me and particularly from the conscious
admissions by the defence of receiving the cheque and proceeds
and of exhausting the cheque and of having the exhausted cheque
in its custody, I hold that as between the plaintiff and its bankers
d the amount is recoverable by the plaintiff as money paid by plain-
tiff. Accordingly there must be judgment for the plaintiff for the
amount claimed.
The defendant is to pay to the plaintiff the sum of N1,568,966.35
e (One Million Five Hundred and Sixty-eight Thousand, Nine Hun-
dred and Sixty-six Naira, Thirty-five Kobo) being money had and
received to the use of the plaintiff.”
The defendant, aggrieved by the judgment, appealed against
f it to the Court of Appeal, Enugu Division. In a unanimous
judgment of that court, delivered by Kolawole JCA it al-
lowed the appeal and concluded:–
“It was established beyond doubt that the appellant did not receive
g credit for the sum of N1,568,946.35 for the reasons which I have
earlier given. The result is that this appeal succeeds and the judg-
ment of Fiberesima, J. dated 13th September, 1984 is set aside. In
its place judgment is hereby entered for the respondent in the sum
of N19.50 representing the balance standing to its credit with the
h appellant as at 16th August, 1983. The appellant is awarded costs
of N1,000 in the lower court and N500 in this court inclusive of
N207 out of pocket expenses.”
The plaintiff has now appealed to this Court.
i The facts involved in this case have been admirably and
adequately stated in the lead judgment of the Court of Ap-
peal by Kolawole. They are as follows:–
“On 10th of August, 1983 the respondent opened a current account
j with the appellant with a sum of N100. On 11th August, 1983 the
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
60 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

respondent deposited a First Bank of Nigeria cheque Ikeja Branch a

for the sum of N1,568,946.35 into its current account at the appel-
lant’s Airport Branch Port Harcourt. The cheque was said to have
been drawn by Parkinson Nigeria Limited on the Ikeja Branch of
the First Bank of Nigeria Limited. The respondent’s account was b
credited with that amount the same day but as it is usual in bank-
ing practice, the respondent’s account was debited with the same
amount because the amount was very heavy. The cheque was then
sent to Ikeja for collection. This was to ascertain whether the c
cheque was a genuine cheque or not. The response from Ikeja that
payment had been effected was sent in an unusual way of a mere
paper transaction, whereas the usual practice whenever an amount
was over N2,000 was that the message conveying payment would
be by coded telegram. Because of the unusual manner in which the d
Ikeja Branch advised payment, the appellant suspected fraud and
they sent a telegram to the Ikeja Branch for confirmation whether
exhibits, 12 and 12A which conveyed that the cheque had been
cleared originated from them. They also sent a letter and Ikeja
Branch replied by exhibit 13 on October 12th, 1983, that exhibits e
12 and 12A were not from them and that the signature on them
was forged.
The appellant also wrote to verify whether Parkinson Nigeria Lim-
ited, the company alleged to have been the drawer of the cheque, f
had an account with the Ikeja Branch of the First Bank of Nigeria
Limited, the Ikeja Branch replied by exhibit 14 that there was no
such account.
After these enquiries when Benedict Ume who testified as the
Managing Director of the respondent came with a cheque to with- g
draw N63,000 from the account, the appellant invited the Police
and he was arrested. At the time of his arrest he had N19.50 to his
credit having earlier withdrawn N80 on the 16th August, 1983.”
Henceforth the plaintiff and the defendant will be referred to h
as the appellant and the respondent respectively.
Briefs of arguments were filed and exchanged which were
orally elaborated upon. The appellant formulated eight is-
sues in his brief while the respondent formulated only one i
issue. I prefer to adopt the approach of the respondent as
regards the issue for determination because not only does
it embrace the relevant issues raised by the appellant in
his brief but it is also the main issue that has arisen for j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 61

a determination in this appeal. In my view the issue can be

reframed as follows:–
“Whether the Court of Appeal was right in its conclusion from the
b evidence adduced at the trial, that the appellant failed to prove that
the Port Harcourt Branch of the respondent had collected the pro-
ceeds of a cheque for N1,568,946.35 from its Ikeja Branch for
crediting to the appellant’s account at its Port Harcourt Branch
situate along Aba Road.”
c
Before I go into the main issue as reframed above, I wish to
specifically deal with issues Nos. 6 and 7 in the appellant’s
brief. It is on the allegation of fraud by the appellant. They
read:–
d
“2.06. Was fraud specifically pleaded, particularised and proved
beyond reasonable doubt by the respondent against the ap-
pellant at the trial in the High Court of the Rivers State in
Port Harcourt before Fiberesima, J?
e
2.07. If fraud was not proved against the appellant, what then
was the respondent’s contractual obligation to the appellant
and had the respondent discharged the contractual obliga-
tion to the appellant?”
f It was the submission of learned Counsel for the appellant
that since the respondent did not specifically plead fraud, the
Court of Appeal misdirected itself in law when it made a
finding that fraud was established. He argued that it was not
g for the appellant to prove his innocence by adducing evi-
dence when the respondent who raised the fraud did not
prove it. He referred to sections 134, 137(1), 138 and 141 of
the Evidence Act and also the decisions in Usenfowokan v.
h Idowu (1969) 1 All N.L.R. 125; Igbinosa v. Aiyogbaigbe
(1969) 1 All N.L.R. 99; Omoboriowo v. Ajasin (1984) 1 S.C.
206; (1984) 1 S.C.N.L.R. 108; Fabunmi v. Agbe (1985)
N.W.L.R. (Part 2) 299; N.I.P.C. v. B.W.A (1962) 1 All
i N.L.R. 556; [1962] 2 S.C.N.L.R. 324; Yassin v. Barclays
Bank (1968) N.M.L.R. 380 and Mobil Oil v. Coker (1975)
S.C. 175.
In reply to the submissions above the respondent con-
j tended that the issue of fraud was raised collaterally and
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
62 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

evidence adduced to show that the documents, that is, the a

Parkinson cheque exhibits 12 and 12A which are the
“cheques for collection advice of Fate Form” and “the inter
Branch Transfer Voucher” respectively were not genuine. b
It is trite law that where fraud is alleged, it must be specifi-
cally pleaded and particulars of the fraud given to enable the
party defending the allegation understand the case he is
facing and prepare his defence (see Davy Bros. v. Garret c
(1877) 7 Ch. 473 and United Africa Co Ltd v. Taylor (1936)
2 W.A.C.A. 67). On the issue of fraud, the respondent
averred in the following paragraphs of his statement of de-
fence that:– d
“7. The defendant vehemently denies paragraph 10 of the
statement of claim and in further answer thereof, the defen-
dant avers that it neither told the plaintiff nor wrote to the
plaintiff to that effect, instead, it was the Managing Director
of the plaintiff Company, Mr Benedict Umeh, who came to e
tell the defendant that the cheque had been paid, that even
increased the defendant’s doubts.
8. The defendant denies the averment contained in paragraph
11 of the statement of claim. And in further answer thereto, f
the defendant avers that payment on the cheque in favour of
the plaintiff company’s Managing Director for N63,000
(Sixty-three Thousand Naira) was refused by the defendant
because there was no confirmation that the cheque for
N1,568,946.35 has been paid at the Ikeja Branch of the de- g
fendant’s Bank, where it was sent for collection.
13. Paragraph 15 of the statement of claim is denied. The bal-
ance standing to the credit of the plaintiff company’s ac-
count is N20 (Twenty Naira) and not N1,568,966.35, since
h
the N1,568,946.35 was not paid or credited into the plaintiff
company’s account. This being so, because there was no
genuine proof of such payment from the First Bank of Ni-
geria Limited, Ikeja Branch.
16. The defendant again denies paragraph 18 of the statement i
of claim. In further answer thereto, the defendant avers that
the cheque for N1,568,946.35 drawn on Ikeja Branch of the
defendant bank, cannot be produced by the defendant since
it was not returned to the defendant. Furthermore, the Ikeja
Branch of the defendant company claims no knowledge of j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 63

a the said cheque since it did not emanate from them. The
said Ikeja Branch did, however, confirm that the whole
transaction was fraudulent in their letters dated the 12th Oc-
tober, 1983 and 9th November, 1983 and will be founded
b upon at the trial.”
The averments in the paragraphs supra raise the issue of
fraud and provide sufficient particulars for the appellant to
understand the case he was facing (see U.A.C. Co Ltd v.
c Taylor (1936) 2 W.A.C.A. 67 particularly at 71 (P.C.)). The
manner of the pleading may look inelegant, but certainly not
inadequate to inform the appellant of the nature of the case
he was to face and defend.
d The appellant also made reference to sections 134, 137(1),
138 and 141 of the Evidence Act. These sections in general
deal with burden of proof. In civil cases, the burden of prov-
ing a particular fact is fixed by the pleadings. Where a
e commission of crime is directly in issue, the party alleging
must prove it beyond reasonable doubt (see Benson Ikoku v.
Enuoh Oli (1962) All N.L.R. 194; (1962) 1 S.C.N.L.R. 307
and also section 137(1) of the Evidence Act).
f In the present case the respondent called DW1, the branch
manager of the respondent who gave evidence as to the
system in operation in the bank when a large amount is paid
by a customer into his account by a cheque. He said:–
g “On 11th August, 1983, Mr Ume came and deposited an Ikeja
cheque for N1,568,946.35. It was said to have been drawn by one
Parkinson Nigeria Limited drawn on Ikeja Branch of First Bank.
We credited the account the same day. Exhibit 4 shows that his
account was credited with the Ikeja cheque, after crediting his ac-
h count we then debited it because the amount is very heavy. We
debited the account and then sent the cheque to Ikeja for collection”.
The witness went on to explain the step next taken if the
paid-in cheque is drawn on another Bank or another branch
i of the respondent’s bank. And since the cheque in dispute
was drawn on another branch of the respondent which is
situate outside Port Harcourt, he said:–
“We sent it to Ikeja to ascertain whether the cheque was a genuine
j cheque. If it is, they would reply to us that the amount has been
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
64 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

paid. We sent it to Ikeja for collection, it is not Port Harcourt a

cheque. The account on which the cheque is being drawn is
at Ikeja. We received the proceeds of the payment which means
the cheque has been paid, but the proceeds was sent by paper
which was unusual. Such an amount over N2,000 should be by b
coded cablegram not just paper. The one I received was not
coded.”

This made him become suspicious of both exhibits 12 and

12A as a result of which letters were sent to the Ikeja Branch c
of the respondent for clarification and confirmation. The
Ikeja Branch of the respondent replied by exhibits 13 and 14
respectively in which not only did they deny the genuineness
of exhibits 12 and 12A, but also that Parkinson Nigeria d
Limited, the alleged drawer of the cheque in favour of the
appellant, had no account with the respondent’s Branch at
Ikeja.
e
DW2, who was at the material time the attempted fraud
was perpetrated and was working in the respondent’s Ikeja
branch, denied ever receiving a cheque for N1,568,946.35
drawn in favour of the appellant. When exhibits 12 and 12A
f
were shown to him he denied also that they emanated from
the respondent’s Ikeja branch and that the purported signa-
tures on them were not that of Mr Adesote (DW3) who was
then his accountant and was therefore familiar with his sig-
nature. On Parkinson Nigeria Limited, the alleged drawer of g
the disputed cheque, DW2 testified that:–
“I was at Ikeja branch for four years. I do not know any customer
name Parkinson Nigeria Limited. I am very sure about it, there is
no such account. The cheque for N1,568,946.35 was never re-
h
ceived by our branch when I was there. Because Parkinson had no
account no proceeds were remitted to Port Harcourt. I have not
seen the cheque for N1,568,946.35. We did not see the cheque.
We did not give value for the cheque.” i
DW3, Thompson Adesote, who was at the material time the
accountant at the Ikeja Branch of the respondent, denied
ever signing exhibits 12 and 12A. He also confirmed that
exhibits 12 and 12A do not bear the signatures of Mr Osi j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 65

a with which he is also familiar. On the cheque for

N1,568,946.35, DW3 testified thus:–
“I cannot recollect having seen the cheque for the amount of
b N1,568,946.35 and no proceeds were remitted to Port Harcourt of
that amount.”
Mr Osi, DW4, denied signing exhibits 12 and 12A. He said
in his evidence:–
c “. . . In 1983 around August I was in charge of Cantonment of
First Bank, Mainland, Lagos, in the Military barracks. I was in
Cantonment branch from 6th September, 1982 to February 19th,
1984. The signatures bearing my name on exhibits 12 and 12A are
not mine. So that at the time the signature were written I was not at
d
that Ikeja branch of First Bank.”
DW6, Alhaji Idris Mohammed, admitted knowing PW1 very
well but denied knowing the company Hightrade Maritime
e Limited.
In rebuttal of this strong and conclusive evidence of
fraudulent motives, the only evidence adduced by the appel-
lant was that of PW2, Benedict Ume, its managing director,
f whose only defence to the attempted fraud is that he paid the
cheque for N1,568,946.35 on 11th August, 1983 into the
appellant’s account with respondent’s branch situate at Port
Harcourt Aba Road, drawn in favour of the appellant by a so
g called Parkinson Nigeria Limited on its account with Ikeja
Branch of the respondent. He said:–
“I remember 10th day of August, 1983, that was the day the plain-
tiff opened an account with the defendant company with N100. I
h also remember 11th August, 1983 that was the day the plaintiff
paid into defendant company a cheque for N1,568,946.35. The
cheque was dated 20th July, 1983. The N100 and the
N1,568,946.35k was paid in with Teller, these are the tellers ad-
mitted without objection as: teller of 10/8/83 for N100 exhibit 3;
i teller of 11/8/83 for N1,568,946.35 exhibit 4. After the payment of
the cheque for N1,568,946.35, I continued to go to the defendant
company to know whether it had been cleared or not, and on 22nd
September,1983, I was told by the bank Manager that the cheque
had been cleared, on that 11th September, 1983. The defendant
j company advised the plaintiff in writing that the cheque had been
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
66 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

sent to Ikeja for collection; the written advice is admitted without a

objection as exhibit 5. On the 16th August, 1983, plaintiff com-
pany withdrew N80 from the account. Then on 23rd September,
1993 the defendant company informed the plaintiff that the cheque
had been cleared so the plaintiff issued a cheque for N63,000 and b
presented for payment. The bank instead of paying the N63,000
called in the police, the cheque was not returned to the plaintiff,
the money was also not paid”.
He admitted under cross examination that Parkinson Nigeria c
Limited issued the N1½ million cheque to appellant though
he did not know the latter’s office in Ikeja. He further testi-
fied:–
“Parkinson Nigeria Limited issued the N1½ million cheque to the d
plaintiff company, at that time with head office at Ikeja. I cannot
remember the address off-head, their engineer came down here. I
have not been to their office at Ikeja. I gave them receipt. I have
not given them any invoice. I did not know that the cheque did not
originate from a cheque book which belong to Parkinson Nigeria e
Limited. I did not know that it originated from a cheque book is-
sued to an individual. I was charged to Chief Magistrate Court,
Port Harcourt in Charge No. PMC/292C/83 in, my name as an
individual Benedict Ume and not in respect of the plaintiff Com- f
pany or connected with it. I pleaded not guilty to any transaction
of N63,000. I do not know that I have not got 1½ million naira
with the defendant company.”
It is to be noted that it was part of the respondent’s case that g
the cheque was drawn from a cheque book issued to an
individual and not to Parkinson Nigeria Limited. This was
contained in exhibit 14 tendered and admitted in evidence
through DW1, exhibit 14 shows that the cheque purportedly
h
drawn by Parkinson Nigeria Limited was from a cheque
book No. IE/1647301–400 issued to one Gregory Batuboh
Umoh, an employee of Messrs Cadbury Nigeria Limited
whose account with respondent’s branch at Ikeja, opened on
25th February, 1982, has been virtually dormant with a i
negligible balance. The appellant did not call Parkinson
Nigeria Limited to prove the authenticity and genuineness of
the cheque purportedly issued by them, which from the
evidence adduced appeared to have been lost between Port j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 67

a Harcourt and Ikeja branches of the respondent. Looking at

the evidence adduced by the respondent in proof of the alle-
gation of fraud, it is now for the appellant to call evidence to
b exonerate itself. PW1 is the managing director of the appel-
lant. This burden is shifted on the appellant by sections 135,
138 and 140 of the Evidence Act. See Johnson and another
v. Maja and others (1951) 13 W.A.C.A. 290; Aouad v.
c Nzimiro and another 10 W.A.C.A 73 and Nigerian Maritime
Services Ltd v. Bello Afolabi (1978) 2 S.C. 79 at 84 where
this Court emphasised that:–
“. . . in the arena in a civil case, the onus of proof does not remain
d static, but shifts from side to side. The correct position in law is
that the onus of adducing further evidence is on the person who
would fail if such evidence was not produced.”

In my view and having regard to the evidence adduced in

e this case, the Court of Appeal was perfectly right to arrive at
the following conclusion:–
“Now learned Senior Advocate contended that no issue was raised
in the pleadings as to whether or not Parkinson Nigeria Limited
f had or had not an account with the Ikeja Branch of the appellant
Bank. It seems to me that learned Senior Advocate has overlooked
the fact that this was plaintiff/respondent’s case. It came out of its
principal mouthpiece that Parkinson Nigeria Limited issued the
cheque in question. The respondent did not prove that it was
g within the knowledge of the appellant that the cheque presented
for payment did not belong to Parkinson but to Gregory Batuboh
Umoh and that as a matter of fact, Parkinson Nigeria Limited who
was alleged to have issued the cheque on its Ikeja branch account
h had no such account with the appellant.”

The main issue contains complaints against:–

(a) the reversal by the Court of Appeal of the finding of fact
i by the trial court; and
(b) the Court of Appeal’s subsequent findings on the evi-
dence that the appellant had failed to prove his case and
therefore did not deserve to have the judgment given in
j his favour by the trial court.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
68 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

It was the submission, of the appellant that the respondent a

did not adduce legal and admissible evidence on which the
Court of Appeal could rely to make the findings and the
conclusion it arrived at. Learned Counsel made reference to b
exhibits 12 and 12A and submitted that since these were
made by the respondent, their contents could not be con-
strued to the detriment of the appellant. On the unaccounted
cheque for N1½ million, allegedly drawn by Parkinson c
Nigeria Limited, in favour of the appellant, it was his sub-
mission that the duty is on the respondent to call Parkinson
Nigeria Limited to disprove the genuineness and authenticity
of the cheque. He further submitted that the duty is on the
d
respondent to call Mr Gregory Batuboh Umoh, the customer
of the respondent and from whose personal cheque book the
controversial cheque was issued, to testify and substantiate
the respondent’s case. He referred to section 148(d) of the
Evidence Act and urged this Court to invoke its provision e
against the respondent in the circumstances of this case.
On exhibits 13 and 14, it was the contention of the learned
Counsel for the appellant that they were suspect as the for- f
mer (exhibit 13) was a fabrication in anticipation of the
proceedings which the appellant had threatened to take
against the respondent while the latter (exhibit 14) was made
after the commencement of the court proceedings by the g
appellant. He described both exhibits 13 and 14 as very
desperate efforts by the respondent to cover up and avoid
liability. He then referred to the evidence adduced by the
respondent and submitted that since the respondent had
h
admitted receiving the controversial cheque and which was
never returned to the appellant or dishonoured, the respon-
dent had no right to debit the appellant’s account already
credited with the proceeds of the cheque. It was also the
submission of learned Counsel for the appellant that there i
was no pleading that exhibits 12 and 12A were not signed by
persons authorised to sign them and therefore the evidence
of DW2, DW3, DW4 and DW5 go to no issue. He submitted
that it was an error of law on the side of the Court of Appeal j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 69

a to rely and base its conclusions and judgment on documents

of doubtful evidential value and which were inadmissible
under section 90(3) of the Evidence Act. He urged this Court
b to allow the appeal, set aside the judgment of the Court of
Appeal, and restore the judgment of the trial court.
In reply to the submissions above, learned Counsel for the
respondent submitted that exhibits 12 and 12A were prop-
c erly admitted in evidence and that it was self defeating for
the appellant to say that exhibits 12 and 12A were not ad-
missible as the learned trial Judge heavily relied on them to
give judgment for the appellant.
d Exhibits 12 and 12A were given in evidence by the re-
spondent to prove that the whole transaction was nothing but
an attempt to defraud the respondent of the sum of N1½
million purportedly paid by the appellant into his account.
e They were admitted through DW1 without objection. The
controversial cheque for N1,568,946.35 was paid into the
appellant’s account by PW1 on 11th August, 1983. It was, as
it is the normal banking practices, credited to the appellant’s
f account which was immediately debited pending clearance.
It was immediately sent to Ikeja Branch of the respondent on
which it was drawn. Thereafter DW1 said:–
“We received the proofs of the payment which means the cheque
g has been cleared, but the proceeds was sent by paper which was
unusual. Such an amount over N2,000 should be by coded cable-
gram not just paper. The one I received was not coded. These are
the documents we received as purported payment advice.
‘Cheques for Collection Advice of Fate Form’ dated 12/08/83 and
h ‘Inter Branch Transfer Voucher’ dated 7/9/83 admitted without
objection as exhibits 12 and 12A respectively: It is usual to use
exhibits 12 and 12A for such heavy amount, for such heavy
amount coded cable was normally used, that is why I say pur-
ported proceeds. We suspected there was fraud so we sent a tele-
i gram to Ikeja Branch of the First Bank to confirm that exhibits 12,
and 12A came from them, they denied that they were [not] from
them.”
To substantiate the evidence of DW1, the respondent called
j DW2, DW3 and DW4 each of whom affirmatively testified
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
70 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

that exhibits 12 and 12A were not genuine. The testimonies a

of these witnesses, i.e. DW1 to DW4, were not discredited
by the appellant.
Even learned Counsel for the appellant, Chief Muoma, in b
his final address in the trial court did not attack the admis-
sion of exhibits 12 and 12A in evidence, but relied on them
to support the appellant’s claim. At the expense of repeating
myself, the duty was on the respondent to prove fraud and in c
the course of that exhibits 12 and 12A were tendered and
admitted. Without these two exhibits, the appellant would
have nothing to rely on to claim the purported and abortive
claim of the clearance and payment of the proceeds of the d
controversial cheque. Where a document is admissible in
civil proceedings under certain conditions and same is ad-
mitted with procedural defect but without objection, the
appeal court will not upset the trial court’s decision solely e
on the ground of inadmissibility of such a document (see
Olukade v. Alade (1976) 1 All N.L.R. (Part 1) 67).
Section 93 provides that:–
“93(1) Primary evidence means the document itself produced for f
the inspection of the court.
(2) Where a document has been executed in several parts,
each part shall be primary evidence of the document.
(3) Where a document has been executed in counterpart,
each counterpart being executed by one or some of the g
parties only, each counterpart shall be primary evidence
as against the parties executing it.”
The main contention of the appellant under subsection (3) of
section 93 supra is that exhibits 13 and 14 were made by h
persons interested and in anticipation of proceedings against
the appellant.
It is not in all circumstances where a servant of an em-
ployer wrote a document on the latter’s behalf that it be- i
comes inadmissible by virtue of section 90(3) of the
Evidence Act. Exhibits 13 and 14 were written by DW2 as a
servant of the respondent in reply to an inquiry sent from the
respondent’s bank to ascertain the genuineness of exhibits j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 71

a 12 and 12A before honouring the appellant’s cheque – ex-

hibit 7. This in my view is not tantamount to making DW2 a
person interested in the proceedings as contemplated in
b section 90(3) of the Evidence Act. The mere fact that he was
the author of exhibits 13 and 14 in his capacity as servant of
the respondent, and which is a party to the present suit, did
not make him a party interested, as he had no direct interest
c in the matter (see Bearmans Ltd v. Metropolitan Police
District Receiver (1961) 1 W.L.R. 634; The Atlantic and the
Baltyk (1945) 62 T.L.R. 461). A person is held not to be
interested under subsection (3) of section 90 of the Evidence
Act when he has no temptation to depart from the truth on
d
one side or the other, a person not swayed by personal inter-
est, but completely detached, judicial impartial independent
(see Evon and Evon v. Noble (1949) 1 K.B. 222. See also
Aguda Law and Practice Relating to Evidence pages 168–
e 175, particularly 172–175, paragraphs 14-06, 14-08, and 14-
09). Is that true of the situation in this case? My answer will
certainly be in the affirmative. I need not repeat the evidence
of the appellant adduced in proof of his claim against re-
f spondent, suffice it to say that all that was done was to prove
payment of the controversial cheque drawn by the alleged
Parkinson Nigeria Limited on its account with respondent’s
Ikeja branch in favour of the appellant. When the respondent
g through the vigilance of DW1 discovered that the purported
clearance of the controversial cheque was a fraud, the duty
shifted on the appellant to adduce evidence to prove:–
(a) the genuineness of the cheque by Parkinson Nigeria
h
Limited;
(b) that Parkinson Nigeria Limited had sufficient funds with
the respondent in its Ikeja account of the respondent’s
i branch to cover the controversial cheque.
Subsection (d) of section 148 of the Evidence Act deals with
failure to call evidence and not failure to call a particular
witness where a party can prove his case without calling
j such a witness (see Tawaliu v. M.M. Kassim (1969) 1
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
72 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

N.M.L.R. 148). The respondent had called witnesses that a

proved that not only was there an attempt to defraud it of the
amount being claimed on the controversial cheque but also
that Parkinson Nigeria Limited had no account with the b
respondent at its Ikeja branch. It was then for the appellant
to call evidence to rebut the presumption which it could only
do by adducing evidence to the contrary. By refusing to do
that, it can safely be presumed that such evidence would, if c
given, be unfavourable to the appellant. The courts are
called upon to presume the existence of one fact from the
existence of a proved fact where such presumption is irre-
sistible, that is when there is no other reasonable presump- d
tion which fits all the facts (see R v. Okereke Iregbu 4
W.A.C.A. 32).
In the circumstance, the respondent had no duty to honour
exhibit 7 when it had satisfied itself that there was not suffi- e
cient money in the appellant’s account to meet the demand.
It is abundantly clear that the learned trial Judge had failed
in his duty to properly consider the evidence before him f
which led him to drawing wrongful conclusions from the
evidence he accepted (see Ebba v. Ogodo (1984) 1
S.C.N.L.R. 372; Okolo v. Uzoka (1978) 4 S.C. 77 at 86, per
Obaseki JSC). g
In my view the Court of Appeal was perfectly right and
justified in re-evaluating and re-considering the whole evi-
dence which the learned trial Judge had failed to do, in order
to arrive at a just decision. The findings of fact and the con- h
clusions arrived at by Kolawole JCA in this case, cannot be
faulted. See Abinabina v. Enyimadu (1953) 12 W.A.C.A.
171; (1953) A.C. 207 where the court commented on inter-
ference by the Court of Appeal with the findings of fact of i
the trial court, as follows:–
“1. In order to obviate the practice there must be some miscar-
riage of justice or violation of sound principle of law or
procedure which result in a miscarriage of justice. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 73

a 2. The term ‘miscarriage of justice’ means a prejudice to the

chance of the other party to get the judgment of the court in
his favour.”
b See also Amida and others v. Oshoboja (1984) 7 S.C. 68 at
89; Woluchem v. Gudi (1981) 5 S.C. 291 at 326 and Okuoja
v. Ishola (1982) 7 S.C. 314 at 349.
The rules of procedure regarding the filing of pleadings is
c meant to assist the parties to make clear to one another, their
respective cases so that each one can adequately prepare his
evidence. Once this is achieved the court will not adhere to
mere technicalities raised by ingenuity of Counsel to pervert
d the course of justice. The court should not be used and ma-
nipulated through technicalities, as a vehicle for perpetrating
injustice. I entirely endorse the expression of my learned
brother Kolawole JCA that “nowhere in the rules of plead-
e ings will the court of law and equity allow technicalities of
pleadings to be employed as an engine of fraud”.
This appeal on the whole lacks merit. It fails and is accord-
ingly dismissed. The judgment and consequential orders of the
f Court of Appeal are hereby affirmed. N500 costs is awarded
to the respondent in this appeal against the appellant.
OBASEKI JSC: On 22nd October, 1990, this appeal came
for hearing and arguments of Counsel were heard. After
g hearing Counsel and studying the brief filed by the parties
together with the record of proceedings and judgment in the
court below, I dismissed the appeal for lack of merit and
adjourned the reasons for the judgment till today. I now
h proceed to give them. But before now, I had the advantage
of reading the draft of the Reasons for the Judgment just
delivered by my learned brother, Wali JSC, and I agree with
his opinions on all the issues raised in the appeal.
i The appellant’s claim was one for money had and received
to the use of the appellant and in the terms set out in the writ
reads:–
“The plaintiff’s claim against the defendant is the total sum
j of N1,568,966.35 (One Million, Five Hundred and Sixty-eight
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Obaseki JSC
74 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Thousand, Nine Hundred and Sixty-six Naira, Thirty-five Kobo) a

being money had and received by the defendant to the use of the
plaintiff at Port Harcourt within the jurisdiction of this Honourable
Court in the course of the defendant’s business as a banker and in
respect of the plaintiff’s Current Account No. 02025984 with the b
defendant’s branch at Aba Road, Port Harcourt commonly or
popularly known as the Airport Branch.
The plaintiff has closed the said account with the defendant and
demanded the aforesaid sum of money being the balance standing c
to the plaintiff’s credit in the said account.
The defendant has since failed and still refused to comply with the
plaintiff’s demand.”
d
The appellant succeeded in the High Court and in giving
him judgment the learned trial Judge found and held as
follows:–
“From the evidence before me and particularly from the conscious e
admissions by the defence of receiving the cheque and proceeds
and of exhausting the cheque and proceeds and of having ex-
hausted the cheque in its custody, I hold that as between the plain-
tiff and its banker, the amount is recoverable by the plaintiff as
money paid by the plaintiff. Accordingly, there must be judgment f
for the plaintiff for the amount claimed.
The defendant is to pay to the plaintiff the sum of N1,568,966.35
(One Million, Five Hundred and Sixty-eight Thousand, Nine Hun-
dred and Sixty-six Naira, Thirty-five Kobo) being money had and g
received to the use of the plaintiff.”

The defendant appealed, and won. The plaintiff lost in the

appeal because the evidence on record did not support the
findings of fact made by the learned trial Judge. h

The evidence on record only supported the finding that the

appellant deposited a First Bank of Nigeria cheque drawn on
Ikeja Branch of the First Bank of Nigeria Limited at Port i
Harcourt.
The finding that the defendant received the proceeds and
exhausted the cheque is not borne out by the evidence. The
contrary is supported by the evidence. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Obaseki JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 75

a The Court of Appeal was therefore justified in reviewing

the facts, and reversing the findings of fact. Where findings
of fact are not supported by the evidence, a Court of Appeal
b has the duty and the power to interfere and in reversing the
findings make the proper findings of fact justified by the
evidence (see Fatoyinbo v. Williams (1956) 1 F.S.C. 87;
(1956) S.C.N.L.R. 274; Chief Frank Ebba v. Ogodo (1984)
c 1 S.C.N.L.R. 372; Okafor v. Idigo (1984) 1 S.C.N.L.R. 481;
Watt or Thomas v. Thomas (1947) A.C. 484, 487, 488; Aki-
nola and another v. Oluwo and others (1962) 1 All N.L.R.
224; Akpor v. Iguoriguo and others (1978) N.S.C.C. Vol. 19
(Part 1) 1115; Okpiri and others v. Jonah and others (1961)
d
1 S.C.N.L.R. 174; Agbonifo v. Aiwerioba and another
(1988) 1 N.W.L.R. (Part 70) 325 and Ekpoke v. Usilo (1978)
6–7 S.C. 187).
e The appellant only had N20 left in its account which it
opened with cash deposit of N100.
A cheque in strict sense, is an order or request for pay-
ment. Until the cheque is honoured or cleared and the
f amount stated on it paid, it is not money.
When the appellant proved that the cheque was deposited,
it should have proceeded to prove that the amount stated in
the cheque was paid to, and received by the respondent. The
g respondent having joined issue on this point with the appel-
lant, the burden of proof is on the appellant and it failed
woefully to discharge the burden. This is more so as there is
evidence that the drawer of the cheque is unknown to and
h has no account with the Ikeja branch of the First Bank of
Nigeria Limited.
It was for the above reasons and the reason lucidly set out
in the reasons for judgment delivered by my learned brother,
i Wali JSC, that I dismissed the appeal on 22nd October,
1990.
KARIBI-WHYTE JSC: After arguments of Counsel in this
appeal on 22nd October, 1990 and having already read the
j records of appeal and the briefs of argument adopted in
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Karibi-Whyte JSC
76 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

argument, I summarily dismissed the appeal on the ground a

that it completely lacked any merits.
I have read the judgment of my learned brother, Wali JSC,
in this appeal. I agree entirely with his reasoning. The facts b
of the case so very clearly and comprehensively stated in
Wali JSC’s judgment, I entirely adopt for the purposes of
my judgment.
Learned Counsel for the appellant has filed five grounds of c
appeal. It is somewhat surprising that eight issues for deter-
mination were formulated from the five grounds of appeal.
This is to say the least an undesirable prolixity in the light of
the real issue for determination involved in the grounds of d
appeal. This Court has constantly counselled and warned
Counsel to refrain from prolixity in the formulation of issues
for determination. The principle has always been and still is
that an issue should be formulated as encompassing a num- e
ber of grounds of appeal. It is undesirable to split a ground
of appeal into more than one issue; thereby rendering the
issues wider than the grounds of appeal complained of.
In my opinion the only issue before us, as was in the courts f
below, is whether the plaintiff failed to prove that the Aba
Road Branch, Port Harcourt of the respondent Bank had
collected the proceeds of a cheque from the Ikeja branch of
the bank and credited appellant’s account at its Aba Road g
branch, Port Harcourt. More tersely formulated, it is:–
“Whether the Court below was right in holding on the evidence
before it at the trial that Appellant failed to prove that the Aba
Road Branch, Port Harcourt of the respondent Bank having col- h
lected the proceeds of a cheque for N1,568,946.35 from the Aba
Road Branch, Port Harcourt, had failed to refund the money to the
appellant.”
This covers the formulation of the many issues by learned i
Counsel for appellant. I will confine myself to this main
issue.
Before discussing the issue I advert to ground 5 relating to
the finding of fraud. These are issues 6 and 7 as formulated j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Karibi-Whyte JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 77

a by appellant. I agree with the reasoning and conclusion of

my learned brother, Wali JSC, on the allegation of fraud
made by the respondent. I agree entirely that the submission
b of learned Counsel for the appellants that respondent did not
specifically plead fraud and the court below could not have
found fraud established is clearly misconceived. It is clear
from paragraphs 7, 8, 13 and 16 of the statement of defence
c that these are averments raising very strong inference of
fraud. The particulars are sufficient to lead appellant from
which he should have understood the case of the defendants
to meet (see U.A.C. v. Taylor 2 W.A.C.A. 67). I think the
d facts averred are sufficient to raise allegation of fraud. I have
already referred to the main issue in this appeal. The issue
consists of complaints against the reversal by the court be-
low of findings fact of the trial court, and the subsequent
e finding by the court below that appellant failed to prove his
case and therefore did not deserve to have judgment in his
favour.
The argument was directed essentially at the right of the
f court below, an appellate court, to reverse and set aside
findings of fact of the trial court. It was submitted that there
was no legally admissible evidence upon which the court
below could have acted. This was founded on the fact that
g exhibits 12 and 12A having been made by respondents
should be construed in favour of the appellants. Learned
Counsel referred to the cheque, which was unaccounted
for, and the subject matter of the action and submitted
h that the onus of proof that it is not genuine is on the respon-
dent. Learned Counsel invited the court to invoke the provi-
sion of section 148(d) of the Evidence Act against the
respondent.
i Continuing his submission learned Counsel for the appel-
lant contended that exhibits 13 and 14 were suspect. He
submitted that exhibit 13 was a fabrication and exhibit 14
was made after the commencement of the court proceedings
j by the appellant, as a desperate effort to avoid liability.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Karibi-Whyte JSC
78 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Learned Counsel for the appellant referred to the evidence a

and submitted that respondent had received the controversial
cheque and credited the account of the appellant. The
cheque having not been dishonoured, respondent had no b
right to debit the account of the appellant already credited
with the proceeds. Learned Counsel commented on exhibits
12 and 12A and submitted that they are documents of evi-
dential value and inadmissible. He submitted that the Court c
of Appeal was wrong to have relied on such evidence.
Learned Counsel for the respondent in his submission ar-
gued that exhibits 12 and 12A were admissible and that the
learned trial Judge relied heavily on them. He pointed out d
that they were given in evidence to expose the attempt to
defraud by the appellant. Learned Counsel explained that the
practice of crediting the account on receipt of a cheque and
subsequently debiting the same account pending clearance is e
normal banking practice. Evidence was called to show that
exhibits 12 and 12A were not genuine. The admission of
exhibits 12 and 12A in the trial court was not challenged.
I shall consider here the submission by appellant that ex- f
hibits 13 and 14 were made by persons interested and in
anticipation of proceedings and, therefore, inadmissible in
evidence. I cannot with justification agree with this submis-
sion. It is not disputed that exhibits 13 and 14 were made by g
DW2 as a servant of the respondent. It was admitted it was
written in the ordinary course of duty. It is in the course of
an inquiry by the respondent bank to ascertain the authentic-
ity of exhibits 12 and 12A, before it could honour exhibit 7, h
namely, the appellant’s cheque, now the subject matter of
dispute. This, in my opinion, does not make DW2 or the
official or servant maker of the document, a person inter-
ested in the proceedings as provided in section 90(3) of the i
Evidence Act.
Section 90(3) Act provides as follows:–
“Nothing in this section shall render admissible as evidence any
statement made by a person interested at a time when proceedings j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Karibi-Whyte JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 79

a were pending or anticipated involving a dispute as to any fact

which the statement might tend to establish.”
It seems to me the provision excludes documents made in
b anticipation of litigation by a “person not personally inter-
ested” in the results of the litigation. Thus the general prin-
ciple is that the document made by a party to a litigation or
person otherwise interested when proceedings are pending
c or is anticipated is not admissible (Barkway v. South Wales
Transport Co Ltd (1949) K.B. 54). The disqualifying interest
is a personal not merely interest in an official capacity (see
Bearmans Ltd v. Metropolitan Police District Receiver
d (1961) 1 N.L.R. 634). Where, however, the interest of the
maker is purely official or as a servant without a direct inter-
est of a personal nature, there are decided cases that the
document is not thereby excluded (see Evon v. Noble (1949)
e 1 K.B. 222; The Atlantic and The Battyk (1946) 62, T.L.R.
461; Re Powe, Powe v. Barclays Bank Ltd (1956) P.110;
Galler v. Galler (1955) 1 W.L.R. 400).

f The nature of the disqualifying interest will depend upon

the nature of duty undertaken by the servant. Where from
the nature of the duty he can be relied upon to speak the
truth, and that he will not be adversely affected thereby, the
g document has always been admitted in evidence. This is
because the rationale of the provision is that he must be “a
person who has no temptation to depart from the truth on
one side or the other a person not swayed by personal inter-
h est, but completely detached judicial, impartial, independ-
ent”.
Of course, before there will exist a disqualifying interest,
or a person will be regarded as “a person interested” there
i must exist a real likelihood of bias. Hence, where an official
is discharging a ministerial duty which does not involve any
personal opinion, the question of bias will not be in issue.
Such document will be admissible under section 90(3) of the
j Evidence Act.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Karibi-Whyte JSC
80 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The facts in this case have not disclosed that any of the a
witnesses for the respondents had a personal interest in the
result of the litigation. The court below was therefore right
to have admitted and acted on exhibits 13 and 14. b
The onus of proof at the end of the case is on the appellant
to prove on the balance of probabilities, that:–
(i) the cheque he paid into his account at the Aba Road
branch, Port Harcourt of the respondent bank was a c
genuine cheque issued by Parkinson Nigeria Limited;
(ii) that Parkinson Nigeria Limited had sufficient funds
with the respondent bank at Ikeja, to cover the cheque
so issued. d
It is only from such admissible evidence that the court can
find for the appellant. In this case respondent did not only
give admissible evidence of an attempt by the appellant to
defraud it of the amount claimed, but had gone further to e
show that Parkinson Nigeria Limited, whose cheque appel-
lant relies upon for funds to credit the account at the Aba
Road Branch, Port Harcourt, of the respondent bank, had no
such account. Appellant has failed to prove that he paid any f
money into the account at Aba Road, Port Harcourt.
In the circumstances, it is not conceivable that there could
be any legal duty on the respondent to honour exhibit 7. I do
not think the facts of this case require calling in aid the pre- g
sumption under section 148(d) of the Evidence Act.
It is clear that the learned trial Judge had failed to properly
consider the evidence before him and therefore came to the
wrong conclusions (Okolo v. Uzoka (1978) 4 S.C. 77; Ebba h
v. Ogodo (1984) 4 S.C. 84; (1984) S.C.N.L.R. 372).
In the circumstances, the Court of Appeal is perfectly justi-
fied to reconsider and re-evaluate the whole evidence which
the learned trial Judge had failed to do and arrive at a just i
decision on the evidence before it (see Abinabina v. Enyi-
madu 12 W.A.C.A. 171; (1953) A.C. 207). The above was
why I affirmed the decision of the Court of Appeal that the
judgment of the trial Judge be set aside in its entirety. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Karibi-Whyte JSC
Highgrade Maritime Services Ltd v. First Bank of Nigeria Ltd 81

a Appellant shall pay costs assessed at N500 to the respon-

dent.
KAWU JSC: I had the advantage of reading, in draft, “Rea-
b sons for Judgment” just delivered by my learned brother,
Wali JSC. I entirely agree with the reasons and will respect-
fully adopt them as my reasons for dismissing the appeal on
the 22nd October, 1990. I too will award costs assessed at
c N500 in favour of the respondent.
BELGORE JSC: The respondent in paragraphs 8, 13 and 16
of the statement of defence clearly indicated the presence of
fraud, that is to say, that the cheque (which finally got lost in
d the bank branches) was not genuine, and that the drawee,
Parkinson Limited was a fake company. The appellant there-
fore knew all along about the case the defence confronted
him with at the trial court (U.A.C. Co Ltd v. Taylor 2
e W.A.C.A. 67).
Above all, the appellant did not have sufficient funds in the
account to meet the amount on the spurious cheque.
It is clear on the evidence before the trial court that the ap-
f
pellant attempted to defraud but the vigilance at the bank
(respondent) made this impossible. The appellant has exhib-
ited extraordinary courage in going to court on a claim
tainted with dishonesty ab initio. No court will ever grant
g such a prayer.
It is for the foregoing reasons and the fuller reasons in the
reasons advanced by my learned brother, Wali JSC, which I
adopt as mine, that I, on 22nd October, 1990, dismissed this
h
appeal.
Appeal dismissed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

82 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Union Bank of Nigeria Limited v. Prof. Albert
Ojo Ozigi
COURT OF APPEAL, KADUNA DIVISION b
OGUNDERE, AIKAWA, MOHAMMED JJCA
Date of Judgment: 23 JANUARY 1991 Suit No.: CA/K/45/90

Banking – Loan – Interest on – Where fixed – Whether bank-

ers can unilaterally increase c

Banking – Nature of
Banking – Practice of – Principles governing
d
Document – Interpretation of – Attitude of court
Facts
The plaintiff in the court below who is the respondent in this
appeal claimed reliefs against the defendant/appellant as e
follows:–
“i. A declaration that the defendants are only entitled to charge
on any loan, overdraft or banking facilities granted to the
plaintiff banking interest prevailing as at the time the plain- f
tiff was granted the said loan, overdraft and/or banking fa-
cilities.
ii. A declaration that the defendants cannot unilaterally and
arbitrarily increase the banking interest payable on the loan,
overdraft or banking facilities granted to the plaintiff with- g
out the knowledge and consent of the plaintiff.
iii. A declaration that the plaintiff having paid a sum of
N229,900.33 out of a total loan of N250,000 granted to him
by the defendant sometime in 1982 cannot be owing the de-
fendant a staggering amount of N353,632.09 or anything in h
the neighbourhood of that amount.
iv. A declaration that the plaintiff having paid a total sum of
N261,632.50 as at 15/11/88 to the defendant on the princi-
pal loan/overdraft of N250,000 based on the agreed 11% in- i
terest rate, he (the plaintiff) is only indebted to the
defendant in the sum of N116,076.10 as at the said l5th No-
vember, 1988.
v. Pursuant to sub-paragraph (iv) supra, an order permitting
the plaintiff to settle the said outstanding indebtedness of a j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 83

a sum of N116,076.10 to the defendant by monthly instal-

ment of a sum of N3,500.
vi. An order of injunction restraining the defendants either by
b themselves, agents, servants, privies or through any person
however from selling, alienating or advertising for sale the
plaintiff’s landed property situate lying and being at Osho-
chokodo, Okene covered by Customary Right of Occupancy
No. OKLG/LAN/CRO/830 and on which a hotel known
c and called OBONGARA GUEST INN AND RESTAU-
RANT LIMITED is built unless and until the plaintiff de-
faults in meeting the monthly instalmental payment as
prayed for.”
d The case for the plaintiff in the court below was as follows:
The plaintiff had obtained a loan of N250,000 from the
defendant in 1982 at the prime rate plus 2% per annum, that
is, 11% per annum for the completion of the plaintiff’s hotel
e called Obongara Guest Inn and Restaurant Ltd situate at
Okene. The plaintiff then mortgaged to the defendant his
landed property at Oshochokodo Okene covered by a cus-
tomary right of occupancy No. OKLG/LAN/CRO/830 on
f which the Obongara Guest Inn and Restaurant Ltd was built.
The plaintiff had since 1982 made a total payment of
N229,000 to the defendant out of the said loan of N250,000.
In 1984 to 1985 the plaintiff could not make any payment as
g he was in detention being a civil commissioner in the gov-
ernment of Kwara State during the Second Republic 1979 to
1983. On 30th January, 1988 the defendants demanded the
sum of N353,632.09k in respect of the said loan of
N250,000 and in respect of which the plaintiff had paid
h
N229,900.33, and threatened to sell off the plaintiff’s inn
used as a collateral, which said inn and restaurant was then
worth over N1.5 million. Out of the N20,000 monthly gross
income he earns from the said inn, staff salaries and mainte-
i nance cost take N16,000 and therefore he can now only
afford to pay N3,500 as monthly instalment. If the defen-
dants were allowed to sell his property worth over
N1.5million, it might be at a give away price to recover their
j purported claim of a little over N0.35million.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

84 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The defendant’s case was that the plaintiff as at 15th April, a

1988, owed the defendant N360,210.37 which represented
the total sum advanced and accumulated interest charges and
other incidental expenses in respect of which the plaintiff b
mortgaged his landed property known as Obongara Guest
Inn and Restaurant Ltd as well as a building situate at Inike
in Okene covered by customary rights of occupancy No.
OKLG/LAN/CRO/826 issued by the Okene Local Govern-
ment. The said Deeds of Mortgage were registered as No. 29 c
at page 29 Volume 20 as well as No. 40 at page 40 in Vol-
ume 20 of the Land Registry at Ilorin. The defendant also
averred that he was entitled to charge bank interest on the
outstanding amount on the said loan at the rate from time to d
time stipulated by the bank as provided under Decree No. 1
of 1969 under which the Central Bank of Nigeria as the
monetary authority regulates and notified the defendant the
rate of interest to be charged on loans and advances which e
was notified to the plaintiff on 17th September, 1988. The
defendant also relied on the Central Bank of Nigeria Credit
Policy Guidelines for 1987 fiscal year as amended at 31st
July, 1987, as well as letters to the plaintiff dated 17th Sep- f
tember, 1987, and 3rd March, 1988, including the letter on
demand dated 13th January, 1988. The defendant called for
the payment of the outstanding sum and the plaintiff ac-
knowledged his indebtedness to the bank in its letter of 12th
January, 1988 whereupon the defendant prayed that the g
plaintiff’s claim be dismissed. Olagunju J, after taking and
considering evidence led by the parties, on 6th June, 1989
entered judgment for the plaintiff as per his claim.
h
The defendant bank dissatisfied with that judgment filed
eight grounds of appeal.
Held –
i
1. The Law of Banking is a specie of the Law of Contract,
with the special usages of commercial transactions in
money, including the use of special documents and
collaterals such as mortgages and debentures thrown in.
As regards loans and overdrafts granted by a bank to a j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 85

a customer, the basis are founded on negotiations through

offer and acceptance.
2. It is trite law that the formation of a contract is not gov-
b erned by rigid but by flexible rules, namely, that there
must be a definite offer, by one party, called the offeror,
and communicated to the other party, called the offeree
who accepts the offer, unless the offeror, the first party,
c dispenses with such communication.
3. Offer and acceptance constitute an agreement provided
that the two parties reached a consensus ad idem, that is
the intention of both parties on what is agreed is identi-
d
cal.
4. An acceptance of an offer may be demonstrated by the
conduct of the parties as well as by their words or by
e documents that have passed between them.
5. A customer may borrow from a bank by way of loan or
overdraft. A loan is a matter of a special agreement. An
agreement for an overdraft must be supported by good
f consideration that is, to pay interest on it, which may be
express or implied.
6. Drawing a cheque where there are not sufficient funds to
meet it amounts to a request for an overdraft.
g
7. The position of a banker taking a legal mortgage for a
definite amount terminates the relationship of banker
and customer as to that amount. The effect is to consti-
h tute a loan account to be kept distinct from the current
account. Where a mortgage is taken to secure a floating
balance or current account, the relationship of banker
and customer continues.
i 8. By the universal custom of bankers, a banker has the
right to charge simple interest at a reasonable rate on all
overdrafts. An unusual rate of interest, interest with pe-
riodical rates, or compound interest can only be charged
j by an express agreement.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

86 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

9. If the relationship is altered into that of mortgagee and a

mortgagor by the taking of a mortgage, interest must be
calculated according to the terms of the mortgage.
10. Where there is a fixed rate of interest on a bank over- b
draft, receipt of the statement of account by the borrower
without protest is deemed to be an acceptance of the
fixed rate.
11. A contract or document is to be construed in their ordi- c
nary meaning as questions of facts.
12. When the language is not only plain but admits of one
meaning, as in Clause 3, the task of interpretation is neg-
d
ligible. Words in a document are to be construed not
only according to the ordinary meaning, but also accord-
ing to the ordinary meaning of the words as applied to
the subject matter, in this case, banking with regard to
which they are used. e
13. It is a cardinal principle of construction of a document
that a party is presumed to have intended what he in fact
said in a document as that the words therein must be
f
construed as they stand.
14. Applying all these principles the plaintiff in the court
below, having set up a credible case by discharging the
burden of proof on him under section 136 of the Evi- g
dence Act, which was not demolished under cross-
examination, the onus shifted on the defendant to ex-
plain that it applied Clause 3 properly to the transaction,
which it failed to do.
h
15. Where the interest is fixed the bankers cannot alter it
unilaterally without an agreement with the borrower.
16. The bank is under an obligation to communicate its
intention to increase the interest rate over and above the i
rate agreed by the parties when the loan was secured.
This will give the borrower notice of the increase of his
liabilities so that if he has any objection he could raise it.
Appeal allowed in part. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 87

a Cases referred to in the judgment

Nigerian
b A.C.B. Ltd v. Ehiemua (1978) 2 S.C. 73 at 76–77
Abiodun v. Adehin (1962) 2 S.C.N.L.R. 305
Abusomwan v. Mercantile Bank of Nigeria Ltd (1987) 3
N.W.L.R (Part 60) 196
c
Afolabi v. Government of Oyo State (1985) 2 N.W.L.R (Part
9) 734
Amizu v. Nzeribe (1989) 4 N.W.L.R. (Part 118) 755 at 771–
d 772
Aouad v. Kessrawani (1956) S.C. 120; 1 F.S.C. 35
Attorney-General Kaduna State v. Atta (1986) 4 N.W.L.R
(Part 38) 785 at 794
e
Attorney-General Oyo State v. Fairlakes Hotels Ltd (No. 2)
(1989) 5 N.W.L.R (Part 121) 255 at 277
Ayoola v. Odofin (1984) 2 S.C. 120
f Bank of the North v. Industrial Development Bank (unre-
ported) CA/K/146/86 of 10th May, 1988
Barclays Bank D.C.O. v. Hassan (1961) All N.L.R. 836
g Bello v. Kassim (1969) N.M.L.R. 148
Bookshop House Ltd v. Stanley Ltd (1986) 3 N.W.L.R. (Part
26) 87
Ebba v. Ogodo (1984) 1 S.C.N.L.R. 372
h
Eka-Eteh v. Nigerian Housing Development Society Ltd
(1973) 6 S.C. 183 at 198
Elias v. Omo-Bare (1982) 5 S.C. 25
i
Enahoro and Co Ltd v. Bank of West Africa Ltd (1971) 1
A.L.R. Comm. 180 at 196–197
George v. Dominion Flour Mill Ltd (1963) 1 S.C.N.L.R 242
j Giwa v. Erinmilokun (1961) 1 S.C.N.L.R. 377
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

88 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Ikomi v. Bank of West Africa (Nig.) Ltd (1965) A.L.R. a

Comm. 25
Imana v. Robinson (1979) 3–4 S.C. 1
Kodinlinye v. Odu (1935) 2 W.A.C.A. 336 b
Larinde v. Afiko 6 W.A.C.A. 108
Lewis and Peat Ltd v. Akhimien (1976) 1 F.N.L.R. 80
Majekodunmi v. National Bank of Nigeria Ltd (1978) 3 S.C. c
119 at 127
Modupe v. State (1988) 4 N.W.L.R. (Part 87) 130
Monier Construction Co Ltd v. Orode (1978) 1 F.C.A. 139 d
at 146
N.I.C.O.N. v. Power and Ind. Eng. Co Ltd (1986) 1 N.W.L.R
(Part 14) 1
Nasr v. Berini (Nig.) Bank Ltd (1968) 1 All N.L.R 274 e
National Bank of Nigeria Ltd v. Awolesi (1964) 1 A.L.R.
Comm. 276 at 286
National Investment and Properties Co Ltd v. Thompson
f
Organisation (1969) N.M.L.R. 99
Nwabueze v. Okoye (1988) 4 N.W.L.R. (Part 91) 664
Nwangwu v. Nzekwu (1957) S.C.N.L.R. 61; (1957) 2 F.S.C.
36 g
Obe v. Executive Secretary F.P.C.N. (1975) 3 S.C. 1
Obembe v. Wemabod Estate (1977) 5 S.C. 115 at 138
Odiase v. Agho (1972) 1 All N.L.R. (Part 1) 170 h
Ogbechie v. Onochie (1988) 1 N.W.L.R. (Part 70) 370
Oguma Associated Companies Nig. Ltd v. I.B.W.A (1988) 1
N.W.L.R (Part 73) 658
Ojogbue v. Nnubia (1972) 1 All N.L.R. (Part 2) 226 i
Ojukwu v. A.C.B. Ltd (1968) 1 All Comm. 161
Onobruchere v. Esegine (1986) 1 N.W.L.R (Part 19) 799
Orizu v. Anyaegbunam (1978) 1 L.R.N. 216 at 221 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 89

a Oyenuga v. University of Ife (1964) 2 A.L.R. Comm. 327

Rickett v. B.W.A. Ltd (1960) S.C.N.L.R. 227
Shell B.P. Petroleum Development Co v. Cole (1978) 3 S.C.
b
183 at 195–196
Shonibare v. Ijale (1960) S.C.N.L.R. 384
Skenconsult v. Ukey (1981) 1 S.C. 6
c Udekwu v. Nwosu (1976) 2 A.L.R. Comm. 387
Woluchen v. Gudi (1981) 5 S.C. 291 at 309
Zoramawa v. Alkanci (1972) N.N.L.R. 15
d
Foreign
Ali v. Saad (No. 2) (1976) 1 A.L.R. Comm. 405
Bradlaugh v. Clarke (1883) 8 App. Cas. 354
e
Chatney v. Brasilian Submarine Telegraph Co (1891) 1 C.B.
79 at 85
Commonwealth Development Corporation v. Central Con-
f struction Power Corporation (1968) 3 A.L.A. Comm. 406 at
413
Crosskill v. Bower Turner (1863) 3 L.J. Ch. 540 at 544
Dinna Bhai and Co Ltd v. Ustaz Estate Ltd (1969) 2 A.L.A.
g Comm. 514 at 517
Lion Insurance Co v. Tucker (1883) 12 Q.B.D. 176
Macfoy v. U.A.C. (1962) A.C. 152
h Mills v. United Country’s Bank Ltd (1912) 9 Chancery 231
Smith v. Cooke (1891) A.C. 297
Warner v. Jacob (1882) 20 Ch.D. 220
i
Nigerian statutes referred to in the judgment
Conveyancing Act of 1881, section 19
Evidence Act (Cap 112), Laws of the Federation of Nigeria,
j 1990, sections 136, 148(d)
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

90 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Books referred to in the judgment a

Halsbury’s Laws of England (4ed), Volume 3, paragraphs
155, 157 and 160
Oxford English Dictionary b
Phipson on Evidence (9ed), paragraph 599

Counsel
c
For the appellant: Bello
For the respondent: Olanipekun

Judgment d
OGUNDARE JCA: (Delivering the lead judgment) The plain-
tiff in the court below who is the respondent in this appeal
claimed reliefs against the defendant/appellant as follows:–
“i. A declaration that the defendants are only entitled to charge e
on any loan, overdraft or banking facilities granted to the
plaintiff banking interest prevailing as at the time the plain-
tiff was granted the said loan, overdraft and/or banking fa-
cilities.
ii. A declaration that the defendants cannot unilaterally and
f
arbitrarily increase the banking interest payable on the loan,
overdraft or banking facilities granted to the plaintiff with-
out the knowledge and consent of the plaintiff.
iii. A declaration that the plaintiff having paid a sum of g
N229,900.33 out of a total loan of N250,000 granted to him
by the defendant sometime in 1982 cannot be owing the de-
fendant a staggering amount of N353,632.09 or anything in
the neighbourhood of that amount.
iv. A declaration that the plaintiff having paid a total sum of h
N261,632.50 as at 15/11/88 to the defendant on the princi-
pal loan/overdraft of N250,000 based on the agreed 11% in-
terest rate, he (the plaintiff) is only indebted to the
defendant in the sum of N116,076.10 as at the said l5th No- i
vember, 1988.
v. Pursuant to sub-paragraph (iv) supra, an order permitting
the plaintiff to settle the said outstanding indebtedness of a
sum of N116,076.10 to the defendant by monthly instal-
ment of a sum of N3,500. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 91

a vi. An order of injunction restraining the defendants either by

themselves, agents, servants, privies or through any person
however from selling, alienating or advertising for sale the
plaintiff’s landed property situate lying and being at Osho-
b chokodo, Okene covered by Customary Right of Occupancy
No. OKLG/LAN/CRO/830 and on which a hotel known
and called OBONGARA GUEST INN AND RESTAU-
RANT LIMITED is built unless and until the plaintiff de-
c faults in meeting the monthly instalmental payment as
prayed for.”
The case for the plaintiff in the court below is as follows:–
The plaintiff had obtained a loan of N250,000 from the
d defendant in 1982 at the prime rate plus 2% per annum, that
is, 11% per annum for the completion of the plaintiff’s hotel
called Obongara Guest Inn and Restaurant Ltd situate at
Okene. The plaintiff then mortgaged to the defendant his
landed property at Oshochokodo Okene covered by a cus-
e
tomary right of occupancy No. OKLG/LAN/CRO/830 on
which the Obongara Guest Inn and Restaurant Ltd was built.
The plaintiff has since 1982 made a total payment of
N229,000 to the defendant out of the said loan of N250,000.
f In 1984 to 1985 the plaintiff could not make any payment as
he was in detention being a civil commissioner in the gov-
ernment of Kwara State during the Second Republic, 1979
to 1983. On 30th January, 1988 the defendants demanded
g the sum of N353,632.09k in respect of the said loan of
N250,000 and in respect of which the plaintiff had paid
N229,900.33, and threatened to sell off the plaintiff’s inn
used as a collateral, which said inn and restaurant is now
h worth over N1.5 million. Out of the N20,000 monthly gross
income he earns from the said inn, staff salaries and mainte-
nance cost take N16,000 and therefore he can now only
afford to pay N3,500 as monthly instalment. If the defen-
i dants were allowed to sell his property worth over
N1.5million, it may be at a give-away price to recover their
purported claim of a little over N0.35million.
The defendant’s case was that the plaintiff as at 15th April,
j 1988, owed the defendant N360,210.37, which represented
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
92 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

the total sum advanced and accumulated interest charges and a

other incidental expenses in respect of which the plaintiff
mortgaged his landed property known as Obongara Guest
Inn and Restaurant Ltd as well as a building situate at Inike b
in Okene covered by customary rights of occupancy No.
OKLG/LAN/CRO/826 issued by the Okene Local Govern-
ment. The said deeds of mortgage were registered as No. 29
at page 29 Volume 20 as well as No. 40 at page 40 in Vol- c
ume 20 of the Land Registry at Ilorin. The defendant also
averred that he was entitled to charge bank interest on the
outstanding amount on the said loan at the rate from time to
time stipulated by the bank as provided under Decree No. 1 d
of 1969 under which the Central Bank of Nigeria as the
monetary authority regulates and notified the defendant the
rate of interest to be charged on loans and advances which
was notified to the plaintiff on 17th September, 1988. The e
defendant also relied on the Central Bank of Nigeria Credit
Policy Guidelines for 1987 fiscal year as amended at 31st
July, 1987, as well as letters to the plaintiff dated 17th Sep-
tember, 1987, and 3rd March, 1988, including the letter on f
demand dated 13th January, 1988. The defendant called for
the payment of the outstanding sum and the plaintiff ac-
knowledged his indebtedness to the bank in its letter of 12th
January, 1988 whereupon the defendant prayed that the g
plaintiff’s claim be dismissed. Olagunju J, after taking and
considering evidence led by the parties, on 6th June, 1989
entered judgment for the plaintiff as per his claim.
The defendant bank, dissatisfied with that judgment filed h
eight grounds of appeal. In this Court the parties have ex-
changed briefs of argument.
In the appellant’s brief the issues for determination were
i
set out as follows:–
“1. Whether the plaintiff (the respondent herein) proved his
case on admissible evidence before the trial court as to enti-
tle him to all the reliefs granted to him by the learned trial
Judge. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 93

a 2. Whether the learned trial Judge was not in error to have

IMPLIED 11% per annum flat rate of interest into the writ-
ten agreement of the parties i.e. exhibits 5 and 6 when
clause 3 of the agreement clearly made provision for the
b rate of interest applicable to the loan, and the parties never
agreed or intended that 11% per annum shall be the interest
rate on the loan.
3. Whether the learned trial Judge was not in error in shifting
c on the defendant the burden of proving or disproving the
unsubstantiated assertion made by the plaintiff to the effect
that he (plaintiff) settled interest rate applicable to the loan
with Alhaji Maiyaki Usman, whereas the settlement was not
reflected in exhibits 5 and 6 signed subsequent to the al-
d leged negotiation.
4. Whether the learned trial Judge was not in error in modify-
ing the terms of the Deed of Legal Mortgage signed in 1982
by oral evidence of a purported negotiation held in 1981.
e 5. Whether, on a proper interpretation of clause 3 of exhibits 5
and 6 the rate of interest payable on the loan received by the
plaintiff was not subject to variation from time to time.
6. Whether the plaintiff was not liable to pay the sum of
f N368,443.50k being the actual sum owed by the plaintiff to
the defendant as at 19th October, 1988 as reflected in exhib-
its 4 to 4s.
7. Whether the order of instalmental payment made by the
trial court is justifiable.
g
8. Whether there are sufficient reasons to justify the order of
injunction made by the trial court restraining the defendant,
being an unpaid mortgagee from realising its money by the
sale of the mortgaged properties.
h 9. Whether the judgment of the trial court is not against the
weight of evidence.”
Shittu A. Bello, Esq., learned Counsel for the appellant, in
the appellant’s brief noted that the plaintiff’s case at the trial
i was that the overdraft of N250,000 attracted an agreed con-
stant rate of 11% interest per annum and that having paid a
total of N261,632.50 as at 15th November, 1988 he had only
N116,076.10 balance to pay as at 15th November, 1988. The
j summation of the case of the defendant on the contrary was
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
94 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

that exhibits 5 and 6 the deeds of mortgage signed by the a

plaintiff in 1982 contained a clause 3 as follows:–
“All interest payable on the moneys hereby secured shall accrue
from day to day at the rate from time to time stipulated by the b
Bank and may be capitalised at such intervals as the Bank may
from time to time prescribe but not more often than monthly and
added to the money hereby secured and shall thereupon bear inter-
est accordingly at the rate aforesaid.”
c
The appellant submitted that exhibits 4–4s were the state-
ments of the plaintiff’s indebtedness calculated in accor-
dance with Clause 3 aforesaid (see pages 216–218 of the
record and the evidence of DW1). It was further submitted d
that since the learned trial Judge rejected exhibit 1, the
memorandum on which the plaintiff relied in proof of a
fixed rate of interest is extrinsic to the agreement of the
parties, the case of the plaintiff could not stand (see record e
page 251; Udekwu v. Nwosu (1976) 2 A.L.R. Comm. 387).
It was then submitted that as regards issue 1 the plaintiff’s
case should have been dismissed since he failed to prove
that the parties agreed to 11% per annum flat rate, the more f
so as exhibit 1 the main evidence relied upon was not admit-
ted. See Ogbechie and others v. Onochie and others (1988) 2
S.C.N.J. 170, 185; (1988) 1 N.W.L.R. (Part 70) 370; Ayoola
v. Odofin (1984) 2 S.C. 120 where the Supreme Court re- g
jected the traditional evidence of the appellant upon which
he founded his claim and dismissed it; Skenconsult (Nig.) v.
Ukey (1981) 1 S.C. 6 where the Supreme Court applied the
dictum of Lord Denning, M.R. in Macfoy v. U.A.C. (1962) h
A.C. 152 that nothing could be built on a void act, exhibit 1,
in the appeal in hand. It was then submitted that the judg-
ment that should follow from the rejection of exhibit 1 was
the dismissal of the plaintiff’s case (Ojogbue and another v. i
Ajie Nnubia (1972) 1 All N.L.R (Part 2) 226). Therefore, the
amount of credible evidence demanded of the plaintiff under
section 136 of the Evidence Act was not proved just as the
plaintiff in Abdul Mamid Ojo v. Primate E.O. Adejobi and j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 95

a others (1978) 3 S.C. 65 at 75 failed in his claim appealed to

the Supreme Court.
It was submitted that the learned trial Judge misconstrued
b the provision of Clause 3 of exhibits 5 and 6 in the face of
the evidence of DW1 at pages 249–250 of the record thus:–
“The rate of interest, according to the defendant’s witness, her
Lokoja Branch Manager, Mr Augustine Gibai, changed 5 times
c between January, 1982 and January, 1989 during which the pre-
vailing rates were as follows:–
a. Between 11/1/82 and Sept., 1984 13½%
b. From Sept., 1984 to Aug., 1986 13%
d c. From Sept., 1986 to Aug., 1987 15%
d. From Sept., 1987 to Feb., 1988 21½%
e. From March, 1988 to Aug., 1988 18½%
f. From Sept. 1988 to Jan., 1989 19½%”
e
Further it was submitted that all these were reflected in the
bank’s statements for the period December, 1981 to 19th
October, 1988 inclusive in exhibits 4–4s. At pages 244–255
f of the record, the learned trial Judge opined in support of a
fixed 11% rate of interest as follows:–
“Apart from exhibit 1 on which the plaintiff relied which as I have
found is inadmissible to vary or contradict the mortgage deeds the
plaintiff also insisted that he came to an agreement with the defen-
g dant’s Assistant General Manager Operations, Alhaji Maiyaki
Usman, with whom he settled on the 11% fixed rate of interest.
That evidence was not contradicted by the defendant who was in a
position to do so. Neither was Alhaji Maiyaki Usman nor the
h Lokoja Branch Manager at the time of the transaction called nor
any record of the deliberation touching on the fixture of the rate of
interest of 13½% produced by the defendant. Failure of the defen-
dant to adduce evidence on that material point justifies the infer-
ence that such evidence if adduced would be unfavourable to the
i bank and I draw that inference. See Ogwa Nweke Onah v. The
State (1985) 3 N.W.L.R. (Part 12) 236. Therefore, I find as a fact
that the rate of interest on the loan agreement between the parties
was settled at 11% per annum and I imply that rate into the two
Mortgage Deeds, exhibits 5 and 6, to interpret Clause 3 of each
j Deed.”
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
96 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

It was then submitted that the learned trial Judge was wrong a
to make these findings and should have applied the rate of
interest given by DW1, as it is wrong to imply into a deed,
which fully expressed the contract between the parties by b
adding anything else (Mills v. United Country’s Bank Ltd
(1912) 9 Chancery 231; Commonwealth Development Cor-
poration v. Central Construction Power Corporation (1968)
3 A.L.R. Comm. 406 at 413; Smith v. Cooke (1891) A.C. c
297). The more so as there was no ambiguity in clause 3. A
fortiori as the Supreme Court enforced a clause in pari ma-
teria with clause 3 in Ojukwu v. African Continental Bank
Ltd (1968) 1 All Comm. 161. As to Issue 3 there was no
d
proof of any subsequent agreement which varied, exhibits 5
and 6, the burden of which laid on the plaintiff under sec-
tions 134 and 136 of the Evidence Act (Abiodun and others
v. Adehin and others (1962) 1 All N.L.R. 550; (1962) 2
e
S.C.N.L.R. 305. See Messrs Lewis and Peat Ltd v. Akhimien
(1976) 1 F.N.L.R. 80, 85. See also Nasr v. Berini (Nig.) Bank
Ltd (1968) 1 All N.L.R. 274). It was then submitted that
section 148(d) of the Evidence Act was improperly applied
as it was for the plaintiff, not the defendant to prove the f
alleged negotiation. Bello v. Kassim (1969) N.M.L.R. 148 in
which it was held that a party is not bound to call a particu-
lar witness if he can prove his case otherwise. It was there-
fore wrong for the lower court to speculate that the evidence g
of Alhaji Maiyaki Usman if called would have been unfa-
vourable to the case of the defendant bank (see Monier Con-
struction Co Ltd v. Chief Orode (1978) 1 F.C.A. 139 at 146;
George Onobruchere v. Eseghine (1986) 2 S.C. 385, 386; h
(1986) 1 N.W.L.R. (Part 19) 799). As to Issue 4 it was sub-
mitted that oral evidence cannot nullify a written agreement
just as previous negotiation cannot alter a subsequent written
agreement (Dinna Bhai and Co Ltd v. Ustaz Estate Ltd i
(1969) 2 A.L.R. Comm. 514, 517; Ali v. Saad (No. 2) (1967)
1 A.L.R. Comm. 405; Colony Development Board v. Kam-
son Ltd and others 21 N.L.R. 75. See Phipson on Evidence
(9ed) paragraph 599). As to Issue 5 the question of the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 97

a variation of rates of interest from time to time rested on the

interpretation of clause 3 and it was the duty of the plaintiff
to prove that the facts contained in that clause do not exist
b (Ikomi v. Bank of West Africa (Nig.) Ltd (1965) A.L.R.
Comm. 25; Halsbury’s Laws of England (3ed) Volume 11
page 323 paragraph 517; Michael John Aouad and another
v. Kessrawani (1956) 1 F.S.C. 35; (1956) S.C.N.L.R. 83;
c Bookshop House Ltd v. Stanley Ltd (1986) 5 S.C. 119;
(1986) 3 N.W.L.R. (Part 26) 87; Oyenuga and others v. Ife
University (1964) 2 A.L.R. Comm. 327; National Bank of
Nigeria Ltd v. Awolesi (1964) 1 A.L.R. Comm. 276 at 286).
As to Issue 6 on the correct amount of plaintiff’s debt as
d
reflected in exhibits 4–4s the evidence of DW1 is conclu-
sive. Barclays Bank D.C.O. v. Memunatu Hassan (1961) All
N.L.R. 836 where it was held that as the defendant has re-
ceived statements of account from time to time showing the
e applicable amounts being charged for interest and even if
she were illiterate had the means of being informed of the
amounts debited against her in that respect and, as there is
no evidence that she bothered to query that amount in any
f way, she must be deemed to have accepted those charges
and at the rate at which they were calculated. As to Issue 7
on instalmental payment of judgment debt this should be
refused on the authority of A.C.B. Ltd v. Ehiemua (1978) 2
g S.C. 73, 76–77. As to Issue 8 on injunction it was submitted
that the trial court was wrong to restrain the defendant from
exercising his power of sale under the mortgage (see Assad
Sabbagh v. Bank of West Africa Ltd (1962) L.L.R. 174;
h section 19 of the Conveyancing Act, 1881; Eka-Eteh v.
Nigerian Housing Development Society Ltd and 1 other
(1973) 6 S.C. 183, 198).
As to issue 9 that the judgment was based on issues not in
i dispute but raised suo motu by the trial court based on inad-
missible evidence the appeal should be allowed (Ebba v.
Ogodo (1984) 4 S.C. 84; (1984) 1 S.C.N.L.R. 372; Kodil-
inye v. Odu (1935) 2 W.A.C.A. 336–337; Woluchem v. Gudi
j (1981) 5 S.C. 291 at 309; Unuwa v. N.T.A. (1961) All
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
98 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

N.L.R. 567; Elias v. Omo-Bare (1982) 5 S.C. 25 at 47; Odi- a

ase and another v. Agho (1972) 1 All N.L.R. (Part 1) 170).
Also a Judge is not competent to depart from the case placed
before him (Orizu v. Anyaegbunam (1978) 1 L.R.N. 216 at b
221). Finally it was submitted that all the irregularities
pointed out in the judgment of the lower court occasioned
the miscarriage of justice and the appeal should be allowed
(Zoramawa v. Alkanci (1972) N.N.L.R. 15). c
Wole Olanipekun, Esq., learned Counsel for the respon-
dent both in the respondent’s brief of argument and viva
voce submitted that the appellant’s issues were not relevant
as he preferred the following issues raised at page 516 of the d
records:–
“i. Whether the learned trial Judge was right in holding that the
rate of interest on the loan agreement between the parties
was settled at 11% per annum. e
ii. Whether the appellant could unilaterally increase the inter-
est rate payable on the loan granted to the respondent.
iii. Having regard to the uncontroverted evidence and figures
given by the respondent in arriving at the outstanding bal- f
ance of his indebtedness to the appellant coupled with the
fact that DW1 could not explain how exhibit 4s was arrived
at, whether the lower court was right in accepting the sum
of N116,076.10 as the correct amount owed the appellant
by the respondent as at 15th November, 1988. g
iv. Whether the order for instalmental payment of a sum of
N3,500 per month granted by the lower court was reason-
able.
v. In view of the circumstances of this case and having regard h
to the sum of N261,632.50 already paid by the respondent
to the appellant as at 15/11/88 ‘out’ of a total loan of
N250,000, whether the grant of an injunction by the lower
court in terms of prayer (vi) of the respondent’s reliefs is
i
justified.
vi. Having regard to the uncontroverted evidence of the re-
spondent and the surrounding circumstances of this case,
whether judgment ought not to have been given in his fa-
vour.” j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 99

a It was then submitted that Issue No. 1 deals with grounds 1–

2; Issue No. 2 covers ground 3; Issue No. 3 covers ground 4;
Issue No. 4 covers ground 5; Issue No. 5 covers ground 6
b and Issue No. 6 covers ground 7. As to whether the lower
court was right in holding that the rate of interest was settled
at 11%, see record page 206 lines 10–15 and 28–32; page
208 lines 10–20. It was then submitted that as the plaintiff
c was not cross-examined at all by the defendant Counsel on
the agreement reached between him and Alhaji Maiyaki
Usman relating to the fixing of the interest rate at 11%
which was not denied by DW1 that should be taken as the
d authentic evidence of the rate of interest and apart from
exhibit 1 on page 255 of the record lines 1–5 the lower court
made the finding that the rate of interest was settled at 11%
based on plaintiff’s uncontroverted evidence on a further
construction of the said clause 3 (see Obembe v. Wema Board
e
Estate (1977) 5 S.C. 115 at 138; Oguma Associated Compa-
nies Nig. Ltd v. I.B.W.A. (1988) 3 S.C.N.J. (Part 1) 13 at 33–
34; (1988) 1 N.W.L.R. (Part 73) 658; National Insurance
Corporation of Nigeria v. Power and Industry Eng. Co Ltd
f
(1986) 1 N.W.L.R. (Part 14) 1 at 4). It was then submitted
that clause 3 in exhibits 5 and 6 contained no clear provision
as to the rate of interest payable. And this view is supported
by page 7 of the appellant’s brief where it was submitted
g that the trial Judge ought to have applied the rates of interest
given in evidence by DW1 instead of implying strange rate
of interest not intended by the parties. Also the failure of the
appellant to call Alhaji Maiyaki Usman to rebut the evidence
h of the plaintiff was fatal to the defendant’s case under sec-
tion 148(d) of the Evidence Act. Besides, exhibits 5 and 6
did not mention any sum N250,000. See record page 114
lines 25–26 on exhibit 5 wherein it was stated that the loan
i granted under this agreement is N100,000 and at page 124
lines 26–27 on exhibit 6 where it was stated that the amount
of loan granted under this agreement is N100,000. Notably
as there was no signature in the spaces provided for directors
j and secretary in exhibits 5 and 6 the appellant did not
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
100 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

execute either of the two documents (see record page 278 a

lines 13–29). Therefore, as the sum of N250,000 was not
mentioned on exhibits 5 and 6 which are inchoate as they
were not executed by the appellant the lower court drew the b
inference based on the negotiation with Alhaji Maiyaki
Usman that the loan granted to the respondent was
N250,000. As such the inference was drawn in favour of the
appellant. It follows that the inference of 11% per annum c
fixed interest should also be drawn in favour of the respon-
dent. Also the plaintiff/respondent pleaded 11% per annum
interest whereas the statement of defence contained no rate
of interest. Therefore all the defendant/appellant’s evidence d
relating to 20% interest or any other rate goes to no issue as
the parties are bound by their pleadings (National Invest-
ment and Properties Co Ltd v. Thompson Organisation Ltd
(1969) N.M.L.R. 99; George and others v. Dominion Flour
e
Mill Ltd (1963) 1 All N.L.R. 71; (1963) 1 S.C.N.L.R. 242).
See also Majekodunmi v. National Bank of Nigeria Ltd
(1978) 3 S.C. 119, 127 where the Supreme Court held that
an acceptance of an offer may be demonstrated by the con-
duct of a party as well as by their words or by documents f
that have passed through them (Nwangwu v. Nzekwu (1957)
2 F.S.C. 36, 37; (1957) S.C.N.L.R. 61; Obe v. Executive
Secretary F.P.C.N. (1975) 3 S.C. 1).
g
As to whether the appellant could unilaterally increase the
interest rate the defendant pleaded the Central Bank of Nige-
ria Credit Policy Guidelines for the 1987 Fiscal Year as
amended; throughout the proceedings the said document was
h
not tendered which was found by the trial court at page 265
lines 4–7 and 18–26; and that the non-production is fatal to
the case of the defendants (Shonibare v. Ijale (1960)
S.C.N.L.R. 384; Imana v. Robinson (1979) 3–4 S.C. 1 at 9–
10). A fortiori as the appellant has not attacked that finding, i
it therefore remains unassailable (Nwabueze v. Obi Okoye
(1988) 10–11 S.C.N.J. 60; (1988) 4 N.W.L.R. (Part 91)
664). Also no evidence was led as to any banking practice,
usage, or custom, which gave the appellant the right to j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 101

a unilaterally vary upwards interest rate (Enahoro and Co Ltd

v. Bank of West Africa Ltd (1971) 1 A.L.R. Comm. 180,
196–197; Larinde v. Afiko 6 W.A.C.A. 108; Giwa v. Erin-
b milokun (1961) All N.L.R. 294, 296; (1961) 1 S.C.N.L.R.
377). It was submitted that the following cases cited by the
appellant were misleading (Sha v. Standard Bank Ltd (1967)
1 A.L.R. Comm. 209; National Bank of Nigeria Ltd v.
c Awolesi (1964) 1 A.L.R. Comm. 279). Besides exhibits 4–4s
at pages 88–107 of the record did not give any detail or even
guidelines as to the rate of interest being charged. DW1
could not say how the figures therein were arrived at. Also
they were only sent to the plaintiff at his request before the
d
case. Therefore Barclays Bank v. Hassan cited by the appel-
lant being a High Court case is also not relevant as evidence
of how 10% monthly compound interest was calculated was
shown on the account sent to the customer in that case. See
e
also Rickett v. B.W.A. Ltd (1960) 5 F.S.C. 113 at 118; (1960)
S.C.N.L.R. 212 where the Supreme Court held that com-
pound interest on an overdraft is only chargeable where the
customer agrees to it.
f
On the question whether the lower court was right in ac-
cepting the sum of N116,076.10 as the outstanding amount
owed the appellant by the respondent, see record page 211
g lines 4–5 where the plaintiff said that he had repaid to the
defendant the total of N261,632.50; and also at pages 212–
213 where he calculated the interest and gave the court accu-
rate figures (see also the findings of the learned trial Judge at
pages 272–273). Also the plaintiff was not cross-examined
h
on the figure N116,076.10. Therefore it was then submitted
that the only version of evidence on that issue was that given
by the plaintiff/respondent. (see record page 274 lines 31–
32, and 275 lines 1–8 (see Obembe’s case already cited;
i Shell B.P. Petroleum Development Co v. Cole (1978) 3 S.C.
183, 195–196; Modupe v. The State (1988) 9 S.C.N.J. 1 at 4;
(1988) 4 N.W.L.R. (Part 87) 130). Further, the plaintiff did
not admit owing N353,632.09 in exhibit 7. Further exhibits
j 4–4s was not self-explanatory (see Attorney-General Oyo
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
102 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

State v. Fairlakes Hotels (No. 2) (1989) 5 N.W.L.R. (Part a

121) 255 at 277). On the question whether the lower court
was right in accepting the sum of N116,076.10 as the out-
standing amount owed the appellant by the respondent, see b
record page 211 lines 4–5 where the plaintiff said that he
had repaid to the defendant the total of N261,632.50; and
also at pages 212–213 where he calculated the interest and
gave the court accurate figures (see also the findings of the c
learned trial Judge at pages 272–273). Also the plaintiff was
not cross-examined on the figure N116,076.10. Therefore it
was then submitted that the only version of evidence on that
issue was that given by the plaintiff/respondent see record d
page 274 lines 31–32, and 275 lines 1–8 (see Obembe’s case
already cited; Shell B.P. Petroleum Development Co v. Cole
(1978) 3 S.C. 183, 195–196; Modupe v. The State (1988) 9
S.C.N.J. 1 at 4; (1988) 4 N.W.L.R. (Part 87) 130). Further, e
the plaintiff did not admit owing N353,632.09 in exhibit 7.
Further exhibits 4–4s was not self-explanatory (see Attor-
ney-General Oyo State v. Fairlakes Hotels (No. 2) (1989) 5
N.W.L.R. (Part 121) 255 at 277). f
As to the reasonableness of instalmental payment of
N3,500 per month, it was submitted that having regard to the
circumstances, it was fair and reasonable (A.C.B. Ltd v.
Ehiemua (1978) 2 S.C. 73, 76–77). As to the order of injunc- g
tion the defendant could not complain as it was subject to
the plaintiff meeting the instalment payment and to prevent
the auction of the plaintiff’s/respondent’s landed property.
As to the question of miscarriage of justice it was submitted h
that none had occurred nor been proved (Abusomwan v.
Mercantile Bank of Nigeria Ltd (1987) 3 N.W.L.R. (Part 60)
196). Also the appellant failed to produce the Central Bank
of Nigeria directives (Stitch v. A.G. Federation (1986) 5 i
N.W.L.R. (Part 46) 1007, 1027, 1030; Afolabi v. Govern-
ment of Oyo State (1985) S.C. 117, 128–129, 136–138, 164–
213; (1985) 2 N.W.L.R. (Part 9) 734). It was finally submit-
ted that the appeal should be dismissed. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 103

a I have given the briefs and record of this appeal deep

thought. One of the difficulties in this appeal is the finding
of the lower court against the admissibility of that exhibit 1,
b a directive from the assistant general manager, Union Bank
Headquarters, Lagos that their Lokoja branch manager
should charge the prime rate plus 2% which he totalled 11%
on the loan between the parties. Also that it was extrinsic to
c exhibit 5, a mortgage deed executed by the plain-
tiff/respondent mortgagor in respect of the first N100,000
overdraft, and exhibit 6, the mortgage deed by the same
mortgagor when the loan or overdraft was increased to
N200,000. In the same breath the lower court found that as
d
the assistant general manager from Lagos, Alhaji Maiyaki
Usman, with whom the respondent negotiated and settled an
interest rate of 11% in exhibit 1, was not called, nor was the
plaintiff’s/respondent’s evidence contradicted on that score,
e therefore the fixed rate of 11% p.a. interest stayed; where-
upon he found as a fact that the rate of interest on the loans
secured by the mortgage deeds, exhibits 5 and 6, as stated in
common clause 3 to them was 11% per annum.
f
The lower court also found that there was no evidence by
the defendant/appellant as to what the Central Bank direc-
tives or prime bank rate was pursuant to sections 29 and 40
of Central Bank of Nigeria Act No. 50 of 1968 and No. 4 of
g 1969, and therefore did not accept the evidence of DW1,
Augustine Gibai that the interest rate changed five times
between January, 1982 and January, 1989 as follows:–
1. 11th January, 1982 to Sept., 1984 – 13½% per annum
h
2. Sept., 1984 to Aug., 1986 – 13% per annum
3. Sept., 1986 to Aug., 1987 – 15% per annum
4. Sept., 1987 to Feb., 1988 – 21½ % per annum
i
5. March, 1988 to Aug., 1988 – 183/4% per annum
6. Sept., 1988 to Jan., 1989 – 193/4% per annum
The lower court then opined that the defendant/appellant
j wrongfully and unilaterally imposed the above stated rates.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
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104 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Further the lower court held that there was no evidence led a
in proof of paragraphs 7 and 7a of the amended statement of
defence, which averred that the plaintiff was informed of the
various changes in the interest rate. Also, exhibits 8 and b
11E, letters of 17th September, 1987 dealing with interest
rate No. 4 above, and exhibits 9 and 11F of 3rd March, 1988
dealing with interest rate No. 5 above, the pair of which
purported to deal with two interest rates were shown under c
cross-examination of DW1 to be self-contradictory in sev-
eral particles and was hurriedly prepared for the purpose of
the litigation in hand.
In the face of the unsatisfactory evidence led by the de- d
fence and the detailed credible evidence of the plaintiff on
the loan, year by year repayments, interest, and outstanding
balance from 1982 to 1988 which at 11% fixed rate showed
the plaintiff paid N257,400.33 to the Bank and by his calcu- e
lation only owed the bank N116,076.10, the learned trial
Judge granted all the reliefs sought by the plaintiff.
What then is the law regarding these transactions? The
f
Law of Banking is a specie of the Law of Contract, with the
special usages of commercial transactions in money, includ-
ing the use of special documents and collaterals such as
mortgages and debentures thrown in. As regards loans and
overdrafts granted by a bank to a customer, the basis are g
founded on negotiations through offer and acceptance. In
Attorney-General Kaduna State and others v. Atta and oth-
ers (1986) 4 N.W.L.R. (Part 38) 785 at 794, I opined thus:–
h
“It is trite law that the formation of a contract is not governed by
rigid but by flexible rules, namely, that there must be a definite
offer, by one party called the offeror, and communicated to the
other party called the offeree who accepts the offer; unless the of-
feror, the first party dispenses with such communication. See Ajayi i
Obe v. The Executive Secretary Family Planning Council of Nigeria
(1975) 3 S.C. page 4. Offer and acceptance constitute an agreement
provided that the two parties reached a consensus ad idem, that is
the intention of both parties on what is agreed is identical. Thus, in
Majekodunmi and another v. National Bank of Nigeria Ltd j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 105

a (1978) 3 S.C. pages 119 at 127 the Supreme Court per Fatayi-
Williams JSC as he then was, opined thus:–
‘An acceptance of an offer may be demonstrated by the con-
b duct of the parties as well as by their words or by documents
that have passed between them.’
See also Carlill v. Carbolic Smoke Ball Company (1893) 1 Q.B.D.
256 at 269.”
c Thus in the case at hand, the negotiations for the loan agree-
ment was evidenced by exhibit 1 dated 28th December,
1981 which was a letter under the hand of the Assistant
General Manager, Lagos Operation, Union Bank, Headquar-
d ters 40 Marina, Lagos and addressed to the Manager, Lokoja
Branch which set out in broad outlines the directives on the
subject: Obongara Guest Inn and Restaurant, Professor Al-
bert Ozigi. A copy was also sent to the area manager,
e Ibadan. Exhibit 1 is not only relevant, but also admissible. It
is therefore deemed duly admitted in evidence. It is common
knowledge that a bank manager cannot entertain applica-
tions for large overdrafts or loans except as directed by the
f bank headquarters, as in this case. Exhibit 1 authorised the
Lokoja Branch of Union Bank to allow the plaintiff to com-
plete and execute the loan application forms at the Lokoja
Branch of Union Bank, which constituted the bank’s offer of
g a loan; and its acceptance by the plaintiff crystallised in the
loan agreement. This is a practical demonstration of the
dictum of Fatayi-Williams JSC, quoted above. The deeds of
mortgages, exhibits 5 and 6, were security documents on the
collaterals that is, the hotel and residence of the plaintiff
h
mortgaged to secure the loan. Exhibits 5 and 6 were there-
fore independent and separate agreements under seal. There
could be a loan agreement simpliciter, without any collat-
eral. Collaterals, which are taken to protect the interests of a
i bank, could be an assignment of the benefits of an insurance
policy, or a debenture over all the assets of a company in-
cluding plants and machinery (see CA/K/146/86 of 10th May,
1988 Bank of the North v. Industrial Development Bank and
j others). Common clause 3 provided for the calculation of
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
106 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

interest from time to time. If exhibit 1 were inadmissible, a

there will be no evidence on the initial rate of interest, and
the loan agreements could be deemed free of interest, as the
deeds of mortgage did not state specific interest rates. It b
reads:–
“3. . . . All interest payable on the moneys hereby secured shall
accrue from day to day at the rate from time to time stipu-
lated by the Bank and may be capitalised at such intervals
as the Bank may from time to time prescribe but not more c
often than monthly and added to the moneys hereby secured
and shall thereupon bear interest accordingly at the rate
aforesaid.”
The word ”stipulate” according to the Concise Oxford Eng- d
lish Dictionary means “mention or insist upon as essential
part of agreement; demand as part of a bargain or agree-
ment”. The appellant therefore had an obligation under
Clause 3 to notify the mortgagor plaintiff/respondent of the e
change in and demand interest rates from time to time start-
ing with the offer of 11% in exhibit 1. Failure to do this
nullifies the variation of interest rate in that clause and fixed
the rate at 11% p.a. f
According to Halsbury’s Laws of England (4ed), Volume
3, paragraphs 155, 157, 160:–
“A customer may borrow from a bank by way of loan or overdraft.
A loan is a matter of a special agreement. An agreement for an g
overdraft must be supported by good consideration that is, to pay
interest on it, which may be express or implied. Fleming v. Bank of
New Zealand (1900) A.C. 577 (P.C.). Drawing a cheque where
there are not sufficient funds to meet it amounts to a request for an
overdraft. Cuthbert v. Roberts Lubbock and Co. (1909) 2 Ch. 226. h
The position of a banker taking a legal mortgage for a definite
amount terminates the relationship of banker and customer as to
that amount. The effect is to constitute a loan account to be kept
distinct from the current account. Where a mortgage is taken to i
secure a floating balance or current account, the relationship of
banker and customer continues.
By the universal custom of bankers, a banker has the right to
charge simple interest at a reasonable rate on all overdrafts. Cross-
kill v. Bower, Bower v. Turner (1863) 32 L.J. Ch. 540, 544. An j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 107

a unusual rate of interest, interest with periodical rates, or compound

interest can only be charged by an express agreement.
If the relationship is altered into that of mortgagee and mortgagor
by the taking of a mortgage, interest must be calculated according
b
to the terms of the mortgage. Ferguson v. Fyfte (1841) 8 CI and
Fin 121; London Chartered Bank of Australia v. White (1879) 4
App. Cas. 413 P.C. Where there is a fixed rate of interest on a
Bank overdraft, receipt of the statement of account by the bor-
c rower without protest is deemed to be an acceptance of the fixed
rate. Barclays Bank D.C.O. v. Hassan (1961) All N.L.R. 836, 839
(High Court) Charles, J., Pappoe v. IBWA (1933) 1 W.A.C.A.
287.”

d Thus exhibit 4, the statements of account of the respondent

which is based on various interest rates, is bad in law as it
does not comply with proper banking usage, nor was the
testimony of DW1 on the unstipulated various interest rates
in compliance with Clause 3. No loan account of the respon-
e
dent, rendered periodically to him was tendered, nor the
letters of notification of changes of interest rates. What was
a loan agreement was treated like an overdraft with a fixed
rate of interest, at least as can be inferred from exhibit 4. It
f does not appear as if the Union Bank officials understood or
appreciated the full purport of Clause 3.
In this regard, a contract or document is to be construed in
their ordinary meaning as questions of facts (Bradlaugh v.
g
Clarke (1883) 8 App. Cas. 354). The second step is the legal
effect to be given to them, that is, the effect of the words is a
question of law (Chatney v. Brasilian Submarine Telegraph
Co (1891) 1 C.B. 79, 85 per Lindley, LJ). When the lan-
h guage is not only plain but admit of one meaning, as in
clause 3, the task of interpretation is negligible. Words in a
document are to be construed not only according to the
ordinary meaning, but also according to the ordinary mean-
i ing of the words as applied to the subject matter, in this case,
banking with regard to which they are used (Lion Insurance
Co v. Tucker (1883) 12 Q.B.D. 176). This notion is encom-
passed in the maxim ut res magis valeat quam pareat, which
j means in order that the document may be valid rather
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
108 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

than perish. It is a cardinal principle of construction of a a

document that a party is presumed to have intended what he
in fact said in a document as that the words therein must be
construed as they stand (Nwangwu v. Nzekwu and another b
(1957) 2 F.S.C. 36, 37; (1957) S.C.N.L.R. 61 per Foster
Sutton FCJ. See Attorney-General Kaduna State and others
v. Atta and others (1986) 4 N.W.L.R. (Part 38) 758, 795–
796; Aouad and another v. Kessrawani (1956) 1 F.S.C. 35, c
36; (1956) S.C.N.L.R. 77; Amizu v. Nzeribe (1989) 4
N.W.L.R. (Part 118) 755, 771–772). Clause 3 can therefore
only be construed as indicated above.
Applying all these principles the plaintiff in the court be- d
low, having set up a credible case by discharging the burden
of proof on him under section 136 of the Evidence Act,
which was not demolished under cross-examination, the
onus shifted on the defendant to explain that it applied e
Clause 3 properly to the transaction, which it failed to do
(Onobruchere v. Esegine (1986) 2 S.C. 385, 386; (1986) 1
N.W.L.R. (Part 19) 799; Nasr v. Berini (Nig.) Bank Ltd
(1968) 1 All N.L.R 274, 299; Obembe v. WEMA Board f
Estate (1977) 5 S.C. 115, 138).
I will now deal with declaration v and vi together. As to
declaration v on instalmental payments, this Court, having
held that the respondent still owes the appellant g
N116,076.10 in declaration iv, which has been granted,
ought not to deprive the bank the immediate recovery of that
sum without good reasons. As to declaration vi, the respon-
dent should be reminded that the bank still possesses the h
potent weapon of a mortgagee to exercise its power of sale
on the only condition that it acts in good faith. Warner v.
Jacob (1882) 20 Ch.D. 220 cited with approval by the Su-
preme Court in Eka-Eteh v. Nigeria Housing Development i
Society Ltd (1973) 6 S.C. 183, 198 is the authority for the
preposition that “if a mortgagee exercise his power of sale
bona fide for the purpose of realising his debt, and without
collusion with the purchaser, the court will not interfere, j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ogundare JCA
Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 109

a even though the sale is disadvantageous, unless the price is

so low as in itself to be evidence of fraud”.
Now, the respondent suggests that he be allowed to pay the
b balance in monthly instalments of N3,500, which means
excluding interest of N42,000 yearly by which the debt will
be liquidated over 2½ years. Even with the current rate of
interest limited to about 20% in the 1991 Budget, 20% sim-
c ple interest over 2½ years will be over N57,000, assuming
my arithmetic is correct. The court must hold the balance of
justice equitably. Therefore, it seems to me that the respon-
dent must realise whatever assets he has to repay the balance
d on the loan within four months. I do realise that it may take
that long to find purchasers for valuable assets.
In brief, the respondent shall pay the balance of N116,076
debt within four months from the date of this judgment plus
e 10% interest per annum. The appeal fails as to declarations i,
ii, iii, iv. It succeeds as to declarations v and vi to the extent
indicated herein with N500 costs against the appellant.
MOHAMMED JCA: I agree with my learned brother, Ogun-
f dere JCA, in the lead judgment, the draft of which I read in
advance, that this appeal fails in regards to declarations i, ii,
iii and iv filed by the plaintiff/respondent at the court below.
I also agree that the appeal must succeed against the declara-
g tions made by the lower court in favour of the respondent in
declarations v and vi.
My learned brother has considered all the salient issues
raised in this appeal and has left me with very little to add.
h
This case has given me anxious moments on the charge of
interests, which the bankers do in this country on loan
agreement. After reading the decision of Charles J, of an
English High Court, which is of persuasive authority over
i my decision, I have to agree that where the interest is fixed
the bankers cannot alter it unilaterally without an agreement
with the borrower. Many a time in this country interests over
loans are increased by bankers unilaterally. I have not come
j by a case where the borrower challenged an increase in bank
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Mohammed JCA
110 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
interest over the rate agreed upon by the parties on the day
the agreement was signed.
I am not unmindful of the terms of the deed of mortgage b
signed by the respondent when he took the loan. Clause 3 of
that agreement contained the following terms:–
“All interest payable on the moneys hereby secured shall accrue
due from day to day at the rate from time to time stipulated by the
Bank and may be capitalised at such intervals as the Bank may c
from time to time prescribe but not more often than monthly and
added to the money hereby secured and shall thereupon bear inter-
est accordingly at the rate aforesaid.”
It seems to me that the bank shall have a free hand, as is d
always the case in this country, to fix interest as it pleases
without communicating same to the borrower. I will unhesi-
tatingly say that such a practice is wrong. It is my view that
the bank is under an obligation to communicate its intention e
to increase the interest rate over and above the rate agreed
by the parties when the loan was secured. This will give the
borrower notice of the increase of his liabilities so that if he
has any objection he could raise it. In the case in hand the
f
bank went on increasing the rates of interest without com-
municating same to the respondent. In view of the opinion of
the learned author in Halsbury’s Laws of England (4ed)
paragraph 160, the appellants are wrong to ignore such vital
communication to the respondent. I will stress where the g
learned author of Halsbury’s opined that by the universal
custom of bankers a banker has the right to charge simple
interest at a reasonable rate on all overdrafts (see Crosskill v.
Bower Turner (1863) 3 L.J. Ch. 540, 544). h
It is my strong view that even in respect of loan agree-
ments, a banker cannot raise an unusual rate of interest
without obtaining an express agreement with the borrower.
For the reasons I have given above and the fuller reasons i
in the lead judgment, I shall dismiss the appeal against the
declarations sought in i, ii, iii and iv. The appeal is allowed
in respect of declarations v and vi. I abide by the orders
made in the lead judgment on costs. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Union Bank of Nigeria Ltd v. Prof. Albert Ojo Ozigi 111

a AIKAWA JCA: I entirely agree with the lead judgment de-

livered by my learned brother, Ogundere JCA. I earlier read
it in draft before now, and I agree that this appeal has no
b merit in respect to declaration of i, ii, iii and iv filed by the
plaintiff/respondent with the lower court. However, the
appeal ought to succeed against the declaration made by the
lower court in favour of the respondent in the declarations
c for v and vi.
My learned brother has considered all the salient issues
raised in this appeal and he has fully dealt with them in the
lead judgment. Therefore, I hereby dismiss the appeal
d against the declarations sought in i, ii, iii and iv. The appeal
is allowed in respect of declaration of v and vi. I also abide
by the orders made as to costs in the lead judgment.
Appeal allowed in part.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

112 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Nigeria-Arab Bank Limited v. J.E.A. Shuaibu
COURT OF APPEAL, KADUNA DIVISION
NDOMA-EGBA, ADIO, OKEZIE JJCA b
Date of Judgment: 10 APRIL 1991 Suit No.: CA/J/147/90

Banking – Collective agreement between Nigeria Employers

Association of Banks, Insurance and Allied Institutions and c
Association of Employees of Banks, Insurance and Financial
Institutions – Status of – Whether overrides conditions of
service of employer
d
Facts
The respondent was a manager of the appellant. He was
dismissed for exceeding his credit level and for wilful dis-
obedience of lawful orders. He challenged this dismissal in e
court averring that his dismissal was unconstitutional and a
violation of the Rules governing his conditions of service as
contained in the Collective Agreement between Nigeria
Employers Association of Banks, Insurance and Allied Insti- f
tutions and Association of Employees of Banks, Insurance
and Financial Institutions.
The lower court found for him and awarded him damages.
The employers (appellant) appealed to the Court of Appeal. g
This case is being reported only on the status of the agree-
ment supra.
h
Held –
The Collective Agreement of Association of Banks, Insur-
ance and Allied Institutions, etc is at best a “gentlemen’s
agreement” an extra legal document totally devoid of sanc- i
tions. It is a product of trade unionist pressure. To be bound
by it, the employee must prove that the employer of labour
subscribed to it.
Appeal allowed. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 113

a Cases referred to in the judgment

Nigerian
Ajayi v. Texaco (Nig.) Ltd (1987) 3 N.W.L.R. (Part 62) 577
b
Ayeni v. Dada (1978) 3 S.C. 35
Elias v. Disu (1962) 1 S.C.N.L.R. 43
Fabunmi v. Agbe (1985) 1 N.W.L.R. (Part 2) 299
c International Drilling Co v. Ajijala (1976) 1 All N.L.R.
(Part 1) 117
Mogaji v. Odofin (1978) 4 S.C. 91
d Odi v. Osafile (1987) 2 N.W.L.R. (Part 57) 510
Odiete v. Okotie (1972) 6 S.C. 83
Olatunbosun v. NISER Council (1988) 3 N.W.L.R. (Part 80)
25
e
Foreign
Addis v. Gramophone Company Ltd (1909) A.C. 488
Kuruma v. R (1955) A.C. 1975
f
Nigerian statute referred to in the judgment
Evidence Act (Cap 112), Laws of the Federation of Nigeria,
1990, section 8
g
Counsel
For the appellant: Pyiki
For the respondent: Olatunji
h
Judgment
NDOMA-EGBA JCA: (Delivering the lead judgment) In the
High Court of Bauchi State, Bauchi Judicial Division, the
i respondent as plaintiff claimed against the defendant bank,
herein the appellant, on a Writ of Summons indorsed as
follows:–
“(1) A declaration that his purported dismissal from service by the
j defendant through a letter dated 31/8/88 is unconstitutional
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
114 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

contrary to natural justice and contrary to the rules govern- a

ing his conditions of service.
(2) An order reinstating him to service and payment of arrears
of his salary.” b
Alternatively, the respondent claimed general and special
damages totalling N700,000. Pleadings were ordered, filed
and exchanged.
c
In a finally amended statement of claim filed in course of
the evidence of the respondent at the hearing, the latter
pleaded that he was employed by the appellant bank in writ-
ing on 23rd May, 1980, on a salary of N5,000 a year. His d
appointment was confirmed in 1981, with the conferment of
“signatory B Powers”.
Respondent claimed to have performed his duties dili-
gently and satisfactorily. He therefore rose on merit after e
about seven years of service to the appellant bank to the
status of Manager “B”.
On 25th November, 1987 the area manager at the time in
f
charge of the Northern Branches of the appellant bank, Al-
haji S.B. Abdulkadir, accompanied by the secretary of a
company registered as Cotos Nigeria Limited, presented a
cheque of N1 million. This was received and lodged in the
account of the latter. g

On the same day, he (respondent) was instructed by Mr

Abdulkadir (area manager) to pay the sum of N200,000 out
of the account of Cotos Nigeria Limited. The payee was not h
definitely stated in the statement of claim referred to above.
Before the instruction pleaded and the representation
made, Alhaji Abdulkadir furnished the respondent with
certain documents including a copy of the board of direc- i
tors’ resolution appointing him (Abdulkadir) chairman of
Cotos Nigeria Limited, hereinafter referred to as the com-
pany, a certificate of Form CO7 completed in the registry
showing that Abdulkadir had been appointed the director of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 115

a the company and a letter signifying his acceptance of the

directorship.
Abdulkadir told the respondent that his (Abdulkadir) col-
b leagues at the Head Office were aware of his new position in
the company. He (Alhaji S.B. Abdulkadir) signed the inter-
nal voucher both for the company and for his employer, the
Nigeria Arab Bank authorising the payment of the N200,000
c to him (Abdulkadir).
Respondent averred that he was “satisfied” with the genu-
ineness of the documents presented by Abdulkadir before
releasing the money (N200,000). He claimed to have acted
d in obedience to the instructions of his area manager, Abdul-
kadir and maintained that the transaction was regular and
consistent with the prevailing banking practice.
Respondent was also of the view that the lodgement of the
e N1 million into the company’s account was for the benefit
of his employer. He mentioned an earlier transaction carried
out on the instructions of the predecessor of the company
involving N65,000 which was authorised by the assistant
f general manager of the appellant.
On the 13th of July, 1988, the respondent was instructed to
proceed on his annual leave on completion of which, he was
to resume at a new station thereafter to begin an attachment
g course at the Head Office. Whilst in Lagos, he was asked by
the executive director of the appellant bank about the trans-
action regarding the withdrawal of N200,000 from the com-
pany’s account. Respondent specifically pleaded that he
h briefed the executive director about the transaction. The
latter asked him, the respondent, to put his briefing in writ-
ing. He did so, promising that a more comprehensive report
would be submitted after going through the records at his
i branch in Bauchi (see paragraphs 11–13 of the final state-
ment of claim at page 27).
On 25th August, 1988, the respondent was served with a
letter of transfer to the Credit and Marketing Department of
j his employer, at the Head Office.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
116 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Before he (respondent) resumed at his new posting, the a

appellant wrote to dismiss him from his employment.
The respondent complained that he was neither queried nor
afforded opportunity to defend himself before the severe b
disciplinary action was taken against him as required in the
terms of his employment. He was not previously warned
of it.
c
He, the respondent, averred that his dismissal is “unconsti-
tutional” and not only contrary to natural justice but a viola-
tion of the Rules governing his (sic) conditions of service as
contained in the Collective Agreement between Nigeria d
Employers Association of Banks, Insurance and Allied Insti-
tutions and Associations of Employees of Banks, Insurance
and Financial Institutions (see paragraphs 14–17 of the
statement of claim to which I will duly refer).
e
The respondent further stated that he was at the time of his
purported dismissal at a salary of N20,944 excluding perqui-
sites which were itemised and set out in paragraph 18 of the
relevant statement of claim. Besides this, he was regularly f
subscribing to a pension scheme at 5% of his annual salary.
He claimed in the alternative N839,413.25 in addition to
general damages of N161,586.75. The special damages were
specifically itemised and set out in paragraph 21 of the g
statement of claim.
Issues were joined in a statement of defence filed before
the finally amended statement of claim and in the course of h
proceedings (see pages 11–13 of compiled record).
The admitted facts are these: The respondent was at the
time of his dismissal a senior staff of the appellant’s bank.
He worked diligently and satisfactorily and was promoted i
on merit to a managerial status “B”. The company paid the
sum of N1million into its account at Bauchi Branch of the
bank. This was reflected in the statement of account. The
latter could not, however, confirm or deny the representation j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 117

a made to the respondent by its area manager, the late Abdul-

kadir.
The respondent was asked to proceed on leave soon after
b the event with instructions that he should resume at the
Marketing and Credit Department of appellant’s Head Of-
fice in Lagos. While in Lagos, the respondent was asked by
the managing director of the bank to brief him on the trans-
c action involving the withdrawal of N200,000 from the com-
pany’s account. After the briefing, respondent was requested
to make a written statement on the matter. He did so. The
appellant was not aware that a comprehensive statement was
d promised by the respondent.
It was disputed in the statement of defence aforementioned
that the appellant bank approved the directorship of the late
Abdulkadir in the company. It categorically denied that there
e was such approval. Rather there was a letter of objection to
it. An area manager of the appellant’s establishment could
not approve facilities or withdrawals of such a scale to cus-
tomers without prior authorisation from the Head Office.
f Moreover, the respondent had on 30th January, 1987 re-
ceived written instructions from the Head Office of the ap-
pellant’s bank directing the suspension of all payments in
the Bauchi Branch in respect of the company’s account.
g
Directions from the Head Office supersedes those of the
area office.
The act of the respondent as Manager “B” was in all re-
h spect irregular and contrary to the appellant’s banking rules.
It was a management direction that payments to the com-
pany should be stopped.
The respondent was queried for the irregular transaction
i and afforded the opportunity of being heard.
It was not true that the respondent could not secure another
employment because of his dismissal from the employment
of the appellant’s bank, nor was his dismissal unconstitu-
j tional or an infringement of the rules of natural justice.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
118 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The appellant bank pleaded that the court should dismiss a

the claim brought by the respondent.
The evidence produced by the parties in support of their
respective positions at the trial was actually in line with the b
state of pleadings. In his evidence in support of the claim,
the respondent admitted that he had the authority to approve
facility to the ceiling of N1,500 for a customer. He main-
tained that Abdulkadir was not only the area manager super- c
vising the Northern Branches of the Bank, he was the
chairman of the company and that his appointment as such
was known to the Head Office of the appellant’s bank in
Lagos. He, however, admitted that the transaction by which d
he (respondent) released the money to Abdulkadir was on an
internal withdrawal voucher and not by cheque. The former
is used for withdrawals from savings while cheques are used
from current account. The internal withdrawal voucher in e
question is exhibit D.
To the respondent’s knowledge, Mr Abdulkadir was not
queried until he died.
The respondent claimed that appellant’s head office was f
aware of the transaction but he did not say how. He, how-
ever, recognised that the Head Office was the ultimate au-
thority. He stated:–
“Before my letter of dismissal I was not issued with any written or g
oral query on the said transaction. The Bank has collective agree-
ment regarding the services of Senior Staff of the Bank. It was in
writing and given to each employee. I was given one. I can iden-
tify my own if seen by the title. This is the one given to me by the h
defendants. Tendered. No objection. Document given to plaintiff is
admitted and marked exhibit ‘G’. I see page 4 paragraph ‘C’ of
Exh. ‘G’ on Dismissal. This provision was not complied with by
the Department. I was never informed that disciplinary action was
being contemplated against me.” i
Respondent appears to have adopted by implication the
contents of his written explanation to the query. In this con-
nection, he admitted in his evidence on oath thus: “I pro-
ceeded to the Head Office Lagos on 23rd August, 1989. On j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 119

a reporting to Executive Director (Operations) he asked me

what I knew about withdrawal of N200,000 – orally. He said
that since the Directors were calling on him the next day I
b was the Manager of the Branch then should brief him on the
said N200,000 withdrawal. I explained to him about the said
N200,000 withdrawal orally, he then directed me to commit
our discussions in writing to enable him study it overnight
c and be able brief the Cotos Nig. Ltd Directors the next day. I
did so in writing same date of my arrival in Lagos on 23rd
August, 1988. I told him that l did not know that I would be
required to discuss the N200,000 as I had come for a course
that I could write in detail on the subject if I was allowed to
d
rush back to Bauchi for relevant documents but he said that
it was not necessary as I was merely writing as an insider in
defence of the Bank. The next day 24th August, 1988 I was
instead given a letter of transferring me to the Department of
e Credit and Marketing – Head Office” (sic).

The appellant bank testified in its defence through the in-

cumbent branch manager, Bauchi, Mr Dali Lawal (DW1).
f He took over from the respondent and gave evidence
through the records in the branch. He mentioned that the
invariable practice of the appellant bank is to forward all
applications for credit facilities to the area office for ap-
proval for amounts not exceeding N50,000. Above, the
g
approval would have to come from the Head Office in La-
gos. Withdrawal from current accounts could only be made
by cheque drawn on the payee. Withdrawals from savings
accounts are with vouchers. He stated:–
h
“If it is an internal transaction then a contra voucher is used if the
amount is below N1,000–N5,000.”
Payments within that level must be authorised by two offi-
i cers on grade “A” signatories. N10,000 and above must be
counter-signed by signatories “A” and the accountant or
assistant manager.
DW1 tendered documents relating to the banking practice
j as described above. On the objection of Mr Pyiki for the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
120 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

respondent, these were rejected by the learned trial Judge a

that they were not pleaded. I will return to this later.
On resumption of evidence, Mr Lawal identified exhibit D.
He could not however, say if the bank inspectors raised a b
query on it. An Area Manager is not a signatory to the
branch operations. Facilities can only be granted on suffi-
cient funds. The company (Cotos Nigeria Limited) was only
N1,000 in credit. c
Harrison Ade Adu testified as DW2. He was at the mate-
rial time Bank Secretary and Head of Legal Department at
the Head Office of appellant’s bank. Admittedly, the com-
d
pany had been a customer of the bank (appellant). There had
been an internal misunderstanding between it and its share-
holders. As a result its account with the appellant bank be-
came inoperative on definite instructions from the Head
Office at the bank. The Bauchi Branch was also instructed to e
stop withdrawals from the company’s account. The letter
containing the instruction was tendered as pleaded in para-
graph 9 of the statement of defence. It was admitted in evi-
dence as exhibit J after the objection to its admissibility was f
overruled.
The account of the company became fully operative again
after a re-consideration of the Head Office. g
DW2 confirmed that the respondent was not queried in
writing but orally. He made representations in writing in
answer to the Executive Director. The written letter was
tendered but was, on the objection of Mr Pyiki, rejected. h
There was no reason given for excluding it. I will consider
this point further. The management considered the respon-
dent’s written explanation and found that he acted without
authority in allowing a withdrawal of N200,000 from the i
company’s account. He was in consequence summarily
dismissed from his employment.
After reviewing the sum total of the evidence adduced and
the legal authorities cited before him in the addresses of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 121

a Counsel, Ike Okoye J found for the respondent on the fol-

lowing terms:–
“I accept and find that the plaintiff (respondent) is entitled to some
b measure of general damages. This breach of contract as perpe-
trated by the defendants (appellants) who were in a position to
know the limits of their power vide exhibit ‘G’ left much to be
desired. I hereby do award the plaintiff the sum of N18,500 as
general damages. In the circumstances, there will be judgment for
c the plaintiff against the defendant Bank in the sum of N173,500
made up as follows:–
(1) N155,000 being special damages for wrongful dismissal.
Total Damages N173,500.”
d After the foregoing signed conclusion, the learned trial
Judge appears to have reopened the case to hear Counsel on
costs. Mr Pyiki for the respondent demanded N505 costs.
Enwezor, Esq. for the appellant bank conceded N250. The
e learned trial Judge awarded N450 against the appellant bank.
I observe here and now that it seems to me irregular for the
learned trial Judge to have reopened the case after signing
his judgment and without any application for costs by Coun-
f sel. Indeed, the question of costs is at the discretion of the
court. It appears to me, however, that there was no basis for
the exercise of the trial court’s discretion on cost. Further-
more, there is no indication that the decision on costs was
g considered and signed before the court rose for the day. This
action may not vitiate the proceedings. It should not, how-
ever, be encouraged.
Completely dissatisfied with the judgment, the appellant
h
Bank appealed to this Court complaining that:–
“Ground 1:
The judgment is against the weight of evidence.
i Ground 2:
The learned trial Judge proceeded on a wrong principle of law
and without any basis in awarding to the plaintiff a lump sum
of N155,000 as special damages and N18,500 as general dam-
ages for wrongful dismissal and this error has occasioned a
j miscarriage of justice.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
122 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Ground 3: a
The learned trial Judge erred in law in rejecting the plaintiff’s
written defence to the query given him dated 23rd August,
1988 in evidence and this error has occasioned a miscarriage
of justice.
b
Ground 4:
The learned trial Judge misdirected himself on the facts and
evidence in holding that the plaintiff was not queried nor af-
forded the opportunity of being heard before his dismissal in c
exhibit ‘F’.
Ground 5:
The learned trial Judge misdirected himself in holding as fol-
lows: ‘The DW1 was not in the Bauchi Branch when the pay- d
ment of N200,000 was made out of the said Cotos Nigeria
Limited account. He relied mainly on what he was told.’ I give
no weight to his evidence. And again that DW2 had an interest
to serve in this case and by these misdirections, the defendant
was denied a fair hearing at the trial. e
Ground 6:
The learned trial Judge misdirected himself on the evidence
and facts of the case when he erroneously held as follows:
‘Again, it is quite clear that if the said sum of N200,000 was f
withdrawn from the account of Cotos Nigeria Limited on
25/11/87 on the instructions of the Area Manager (North) Al-
haji S.B. Abdullahi who was also the Chairman of the said
Cotos Nigeria Limited the same Bank keep quiet from 1987
when the said Abdulkadir was there and alive only to harass g
the plaintiff in 1998 as late as August. . . . . The Area Manager
North is the eye and ear of the Head Office of the defendant in
the Northern States. It is therefore presumed that the knowl-
edge of the said Area Manager (North) about the said with-
drawal of N200,000 must be imputed to the defendant Bank.’ h
Ground 7:
The learned trial Judge misdirected himself on the plain mean-
ing of exhibit J. In holding as follows: ‘Upon a careful reading
of the said letter, I cannot see anything therein to suggest that i
the Bank Management gave a directive or instruction that no
money should be paid out of Cotos Nigeria Limited account
by the Broad Street Branch. It is at best a courteous communi-
cation by the Officer to a colleague for reasons best known to
him.’ ” j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 123

a The particulars appended to each of the grounds of appeal

enumerated above are amply stated in the compiled record
(see pages 76–79).
b Briefs were exchanged as required by the Rules of this
Court.
The issues identified for the appellant are formulated and
set forth at page 3 for determination in its brief of argument.
c These are, inter alia:–
“(a) WHETHER OR NOT the learned trial Judge followed
correct legal principles in awarding the sum of N155,000
as special damages and N18,500 as general damages in
d favour of the respondent when the respondent’s contract
of employment is governed by the common law without
a statutory flavour.
(b) WHETHER the learned trial Judge was right in rejecting
in evidence the respondent’s written defence to the with-
e drawal of N200,000 from Cotos Nigeria Limited when
same was pleaded by both the appellant and the respon-
dent in their pleadings.
(c) WHETHER OR NOT in view of the respondent’s dis-
f obedience to the appellant’s instruction in exhibit J there
was a wrongful dismissal of the respondent by the appel-
lant.
(d) WHETHER OR NOT considering the manner of evalua-
tion of the evidence of the appellant’s witnesses by the
g learned trial Judge, the appellant had fair hearing at the
lower court.
(e) WHETHER OR NOT there is a misdirection on the part
of the learned trial Judge on the purport and plain mean-
h ing of the words in exhibit J.”
On his part, the respondent expressed and presented out two
questions to be settled. They read:–
“(1) Whether or not the learned trial Judge was right when he
i held that the respondent was wrongfully dismissed.
(2) If he was wrongfully dismissed, what was the measure of
damages?”
It seems to me that the issue which actually spreads through
j the facts of this appeal is the rejection of the respondent’s
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
124 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

explanation to the purported unauthorised withdrawal of the a

sum of N200,000 from the company’s account on the repre-
sentation made by the area manager of the appellant bank at
the material time. It hinges significantly on the burden of b
proof in civil cases and the onus on the respondent to prove
convincingly the averments made in his pleadings. I will
consider this point in some detail later.
The rejection of the explanation is a ground of appeal in c
this case.
Related to the aforesaid, is the question of the validity of
the respondent’s summary dismissal from his employment
d
with the appellant bank.
The next question to be considered is whether the quantum
of damages awarded to the respondent is consistent with the
generally known precepts in the computation of damages. e
Connected with this is the issue of double compensation in a
single case and whether, in any case, the special damages
claimed in the alternative to general damages flowing from
the cause of action, were proved as averred in the finally f
amended statement of claim.
Respondent admitted that he was questioned at the head
office of the appellant about the unauthorised transaction
with the late area manager of the bank, purportedly on be- g
half of the Company. As a result of the inquiry, he tendered
a written explanation. This was rejected at the trial without
any reasons stated in the record.
By his own evidence on oath, as mentioned earlier, the re- h
spondent, about his written reply to the query on the irregu-
larity complained of in the operation of the company’s
(Cotos Nigeria Limited) account in Bauchi Branch of the
bank, did not appear to have supported the exclusion of the i
said explanation from the proceedings by the learned trial
Judge without any reason stated. Respondent’s evidence
referred to is extensively quoted herein-before, and this is
consistent with paragraphs 12 and 13 of his final pleadings. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 125

a The appellant rejoined in paragraph 10 of the statement of

defence.
By the course of action aforesaid, the learned trial Judge,
b with due respect undoubtedly unintentionally, swung the
respondent’s case to a position from which it could be rea-
sonably inferred that he was inconsistent. His case is thus
perverted on a material point. I will consider this issue more
c fully in relation to “admissibility” and “relevancy” of evi-
dence.
Generally, a trial court is not bound to give reasons in a
court note for every step taken during proceedings in a case
d before it, else the volume of the record would be stupen-
dous. I think, however, that on important matters such as the
rejection of evidence duly pleaded and otherwise relevant,
and in respect of which an objection has been taken by an
e opposing Counsel to its admissibility, the court ought to
record its reasons for accepting or disallowing the evidence.
His view thus becomes a decision, appealable.
For the reasons which follow shortly, I am profoundly of
f the opinion that the respondent’s written explanation was
wrongly excluded from the proceedings of the court below.
The exclusion of the respondent’s explanation to the query,
the contents of which are admittedly not in dispute, is baf-
g fling.
The said document was pleaded, relevant and supported by
the respondent’s own evidence on oath. Besides this, a
proper foundation had been laid for it to form part of the
h record of proceedings at the trial. My view is that if the
rejected evidence is not restored on record or otherwise used
a failure of justice would certainly occur, a suppression of
the truth.
i Although admissibility and relevance are distinct concepts
in the law of evidence, the former being a question of law
and the latter of fact, by section 8 of the Evidence Act what
is relevant is admissible, unless there are compelling reasons
j to exclude it or that the evidence is hearsay.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
126 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Brett F.J. adopted the dictum of Lord Goddard in the case a

of Kuruma v. R (1955) A.C. 197 P.C. at 204 and stated in
Elias v. Disu (1962) 1 All N.L.R. 214; (1962) 1 S.C.N.L.R.
361 that in determining whether a particular piece of evi- b
dence is admissible. “It is the relevancy of the evidence that
is important and not how the evidence was obtained.”
In Ayeni v. Dada (1978) 3 S.C. 35, Fatayi-William JSC, as
he then was, observed that the question of admissibility of c
evidence is distinct from the question of weight to be at-
tached to it. “Weight”, in the context of this observation,
means relevancy.
It is trite that the power of a trial court to reject evidence is d
limited to testimony which is clearly inadmissible. It does
not extend nor could it be stretched to reject legally admissi-
ble evidence pleaded and relevant to the matters at issue.
Ground 3 of the appeal relating to issue (d) in the appel- e
lant’s brief of argument seems to me well taken.
It is within the competence of this Court to act on the writ-
ten explanation of the respondent to the oral query issued to
him for the said unauthorised dealings with the company f
(Cotos) and the erstwhile area manager of the Northern
States (Abdulkadir) of the appellant bank excluded by the
learned trial Judge.
In the instant appeal, however, there is other sufficient evi- g
dence on record for the determination of the appeal either
way even if the rejected statement is not used on the line
suggested above. Grounds 6 and 7 of the appeal, relating to
issue (c) in the appellant’s brief of argument, are together h
central. For this purpose, exhibit J which forms part of the
proceedings after an objection to its admissibility was over-
ruled, is relevant. The pertinent part of it says:–
“Please do not allow the Customer (Cotos Nigeria Limited) to i
withdraw from the account but payment can be received into it.”
In spite and in fact in defiance of his employer’s official
instructions, the respondent, by his admission, released the
sum of N200,000 to Abdulkadir on an internal voucher j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 127

a completed by the latter and signed by both of them (respon-

dent and Abdulkadir). The Head Office of the appellant
bank was not informed of the transaction involving such a
b staggering amount of money.
The haste with which the transaction was carried out seems
inexplicable.
The management became aware of it through the returns
c made despite the mechanism for quick communications
generally known to be provided at all branches of the bank.
It is not disputed that an area manager could only approve
credit facilities to the limit of N50,000 while the respondent
d
in his status, is confined to N1,500 ceiling.
The use of an internal voucher instead of a cheque for the
withdrawal of the sum of money complained of, was, unde-
e niably, contrary to the prevailing banking practice in the
appellant’s establishment. The irregularity of the transaction
was therefore total, and on the part of the respondent,
grossly negligent and disquieting.
f The only defence raised by the respondent was a plea, in
military parlance, of “superior orders” of the area manager.
Respondent could not resist the latter’s representation, even
if it was apparently irregular and indefensible.
g The representations made, according to the respondent, by
the area manager (Abdulkadir) that he was the incumbent
chairman of the company (Cotos) by virtue of his position in
the appellant bank and a director of it (Cotos) were not true
h and the documents presented to the respondent in support of
the claim were, according to DW1, fictitious, a situation that
could have been easily and quickly verified from the Head
Office of the Bank in Lagos.
i From the evidence on record, it seems to me that there was
some scheming: The respondent appears to have withheld
the whole truth about the transaction in question.
In view of the entire evidence produced and which was not
j in substance effectively challenged by the respondent, it
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
128 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

could not be controverted that the latter not only disobeyed a

the instructions of his employer (the appellant) but acted to
its discredit and detriment.
Mr Pyiki for the respondent had argued that exhibit J ought b
to have been rejected on grounds of irrelevancy and for
being at variance with the pleadings. He contended further
that exhibit J was addressed to the branch manager at Broad
Street in Lagos and not to the respondent in Bauchi. I see no c
basis whatsoever for the respondent’s denial of knowledge
of the contents of exhibit J, neither does learned Counsel
really believe his own argument in support of it.
In fact, exhibit J was addressed to the manager of the ap- d
pellant’s branch at Broad Street, Lagos, but it was endorsed
to the assistant general manager in charge of Operations and
to the branch manager in Bauchi.
DW2, the successor to the post in Bauchi branch tendered e
exhibit J during his evidence for the appellant at the trial of
his custody in the day-to-day management of the branch.
The authenticity and source of it could not therefore be in
doubt as suggested by Mr Pyiki on behalf of the respondent. f
Without any prepared grounds or base if any existed, the
learned trial Judge surprisingly rushed to the conclusion at
page 58 line 35 to page 49 of the printed record, that he
believed that the respondent (plaintiff) was never instructed g
to stop any dealings with the company (Cotos) and that
exhibit J was never communicated to the respondent.
If the learned trial Judge “carefully” read through exhibit J
as recorded in his judgment and still arrived at the conclu- h
sion aforesaid, it seems to me, with respect, that the logical
inference to be drawn from the situation is that he over-
looked the contents of exhibit J in circumstances that it
could be readily accepted that the totality of the evidence i
recorded at the trial was not properly assessed, appraised
and evaluated.
Saying this in other words, the trial court was absolutely
convinced, rather too early in the proceedings of the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 129

a respondent’s (plaintiff’s) case. In the position it took, it

could hardly sufficiently consider the other version of the
controversy before reaching the decision appealed from. It is
b therefore incumbent on this Court and having regard to the
sum total of the evidence recorded at the hearing, to adjust
this on the scale, without necessarily hearing further evi-
dence, in order to achieve a reasonably balanced verdict.
c It has been decided, time and again, that the expression “I
believe” this or that witness cannot be a cure for all ills nor
is the mere pronouncement of the words open to truth and
nothing but the truth. It must be clearly shown in the record
d that there was a plinth for such conclusion. The reverse of
the principle declared by Obaseki JSC in David Fabunmi v.
Abigail Agbe (1985) 1 N.W.L.R. (Part 2) 299 would appear
equally correct. Similar observations were made in the deci-
e sion of this Court (Jos Zone) in Tsako Mason v. The State
CA/J/48/88 delivered on 16th November, 1989.
In Paul Odi v. Osafile (1987) 2 N.W.L.R. (Part 57) at 510,
the Supreme Court tersely explained the principle thus:–
f “In the evaluation of the evidence adduced at a trial, it is wrong for
the trial Judge to first consider the evidence in support of the case
for the one party and accept same before considering the case for
the other party. The proper procedure is to put the two sets of fact
g on an imaginary scale, weigh one against the other then decide
upon the preponderance of credible evidence which weighs more,
accept it in preference to the other and then apply the appropriate
one.”

h Obvious contradictions were not reconciled in the instant

appeal.
See also the eminent observations of Fatayi-Williams JSC,
as he then was, in Mogaji v. Odofin (1978) 4 S.C. 91 by
i which he emphasised the need to maintain fair balance in
judgments.
In view of the comments I have made, grounds 6 and 7 of
the appeal connected with issues (d) and (e) succeed.
j Ground 5 is predicated on the same facts. It also succeeds.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
130 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Ground 1 rests on fact. The facts are on record and these a

have been fully examined in relation to the conclusions of
the learned trial Judge on relevant issues in the instant ap-
peal. I am therefore in agreement with the learned Counsel b
for the appellant bank that the judgment appealed from is
insupportable as observed earlier.
The learned trial Judge did not sufficiently assess, appraise
and evaluate the evidence before him in order to arrive at a c
balanced conclusion. Ground 1 of the appeal therefore suc-
ceeds. It is a general ground which is not connected with any
of the issues expressed and set out for decision.
In regards to the comments made by the learned trial Judge d
on exhibit J, admitted after the objection of learned Counsel
for the respondent was overruled, I think there is a miscon-
ception of the meaning of the expression generally known in
pleadings as a “going to no issue”. This in my view means e
that issues which were not specifically joined will not be
taken as matters in controversy. These cannot therefore be
raised at the hearing of a case unless by the employment of
the process of amendment of pleadings taken within a rea- f
sonable time. The opponent in the case will in the circum-
stances be given the opportunity to rejoin by a consequential
amendment of his own pleadings.
It is settled in many cases that only facts upon which a g
party to litigation relies to prove his case may be pleaded
and not the evidence in proof of them. Not every conceiv-
able detail relating to the facts should necessarily be stated.
There are matters which may be inferred from the facts h
averred. Pleadings are not intended to be essays or thesis.
Facts are usually stated in outline.
The learned trial Judge appears to have had a change of
mind as the record suggests, after admitting exhibit J (the i
instructions given to the respondent not to allow withdraw-
als from the account of Cotos Limited). He, with respect,
preferred to say that exhibit J was not addressed to the
respondent and that the appellant did not give any such j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 131

a instructions, thereby unwittingly leaving an exit for the

respondent to avoid the implications of his admissions.
I think the message conveyed in exhibit J was explicit and
b understood by the respondent as pleaded in paragraph 10 of
the statement of defence in page 12 of the record. None of
the parties could rebound from these.
c Respondent was led in evidence by Counsel and the appel-
lant was cross-examined. It was not suggested to the latter
that exhibit J was contrived.
In paragraph 10(a) of the final amended statement of
d claim, the respondent averred:–
“The Area Manager is a superior officer and a member of the de-
fendant’s management whose instructions override earlier instruc-
tions (if any) of an officer junior to him. This same averment was
e repeated in the final amendment statement of claim dated 20th
October, 1989 at pages 16–19 of the records in paragraph 10(a)
thereof.”
See pages 3–6 of the record. The respondent did not tender
f the earlier instructions he claimed to have received from a
junior officer and how this were countermanded by that of a
superior officer.
It is obvious that the respondent, as plaintiff in the court of
g first instance, did not discharge the onus on him to prove his
case on a balance of probabilities.
Where the burden is on the plaintiff to establish certain
h facts relevant to his case, he must discharge it “by proving
by evidence which will convince the court or tribunal of the
probability of his case on the point in issue” (see Odiete v.
Okotie (1972) 6 S.C. 83).
i The evidence of DW1 and DW2, having not been success-
fully refuted on the official message, exhibit J stands against
the respondent for unchallenged evidence ought to be ac-
cepted as proof of the facts it contains, unless there is other
j evidence to effectively rebut it.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
132 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

There is yet another phase to issue (c) in the appellant’s a

brief of argument. This is equally important in the determi-
nation of this appeal. It poses the question was the dismissal
of the respondent wrongful? b
Exhibit G, the collective agreement of Association of
Banks, Insurance and Allied Institutions, etcetera is, at best,
a “gentlemen’s agreement”; an extra-legal document totally
devoid of sanctions. It is a product of trade unionist’s pres- c
sure.
The respondent claimed both in his pleadings and in his
evidence adduced in support of them, that the tenure and
security of his employment with the appellant rest on Article d
4(c) of exhibit G. It reads:–
“Before either summary dismissal or warning letter is effected, the
employee shall be given a query and afforded the opportunity of
defending himself in writing except where the employee has ab- e
sconded.”
There is no evidence that the appellant as an employer of
labour subscribed to the foregoing. Even if exhibit G had the
quality and force of law as they say “properly so-called”, f
that is, it was brought about by known process of law-
making, then the provision of Article 4(11) that an employee
may be summarily dismissed for “wilful disobedience of
lawful order or serious negligence” is noticeable. The re- g
spondent ought to have taken this into account in his plead-
ings and evidence. He appears to have conveniently avoided
that.
However, the terms and conditions upon which the re- h
spondent accepted the employment offered by the appellants
are contained in exhibit A, letter of appointment. It states:–
“You are at liberty to resign your appointment during probation
giving notice of two weeks or two weeks pay in lieu. Also the i
bank is at liberty to dispense with your service if you do not meas-
ure up to standard by giving you notice of two weeks or two
weeks pay in lieu of notice.”
The emphasis is provided. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 133

a Exhibit A is binding on the appellant and the respondent.

Mr N. Enwezor, Counsel for the appellant at the trial, val-
idly contended, in my judgment, that the terms of the re-
b spondent’s employment with the appellant were not derived
from statute or from exhibit G. The relationship is based
primarily on the law of master and servant at common law
and on exhibit A to which I have referred.
c Respondent has offered no consistent explanation in ex-
hibit J, the effect of which has been sufficiently, I think,
considered in this judgment. The act of the respondent was,
indeed, “flagrant” disregard of the instructions of the
d appellant. By that the respondent could not be said to have
maintained the standard of service expected on him.
Respondent’s entire defence that he acted on the instruc-
tions of his area manager, Abdulkadir lacks credibility.
e
With the duration of the experience in banking the respon-
dent claimed for which he was amply compensated by rapid
promotions, he ought to know the limitations of the author-
ity of an area manager vis-à-vis that of the management at
f
the apex. The authority of the former is clearly penultimate.
Measuring up to standard in exhibit A (supra) of an em-
ployee is not confined to his efficiency at work. It includes a
g commitment to safeguard the interest of his employer, rea-
sonably minimise financial losses and maintain the reputa-
tion and goodwill of the establishment.
In summary, any act outside the scope of an employee’s
h duties in his employer’s establishment which is prejudicial
to the latter’s interest is wilful misconduct, considering the
nature of the business and service in which his master is
bound to provide to the customers.
i Applying the principles stated to the situation of the pre-
sent appeal, the respondent did not prove his mettle to the
end. If he did earlier, he subsequently soiled it.
I now return to the point made by learned Counsel for
j the appellant at the trial of this case that the terms and
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
134 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

conditions of service of the respondent are neither statutory a

nor based on the Constitution. These are controlled by the
common law and on exhibit A. Under both, the misconduct
exhibited by the respondent in this case justifies instant b
dismissal.
In Professor Dupe Olatunbosun v. NISER Council (1988)
3 N.W.L.R. (Part 80) 25 at 31, the Supreme Court defined
c
“misconduct” as follows:–
“Under Common Law and statute law, disobedience of lawful
order from any servant high or low, big or small is viewed
with seriousness such conduct normally and usually attracts the
penalty of summary dismissal as disobedience ranks as one of the d
worst forms of misconduct in any establishment. To warrant sum-
mary dismissal it is enough that the conduct of the servant is
of such a grave and weighty character as to undermine the rela-
tionship of confidence which should exist between master and e
servant.”

See also Ajayi v. Texaco (Nig.) Ltd (1987) 3 N.W.L.R. (Part

62) 577 at 579, where the Supreme Court held thus –
“There is no fixed rule of law defining the degree of misconduct f
which would justify a dismissal. It is enough that the conduct of
the servant is of a grave and weighty character as to undermine the
confidence which should exist between him and the master. Work-
ing against the deep interest of the employer clearly amounts to g
gross misconduct entitling the employer to premptorily [sic] dis-
miss the employee irrespective of the condition of service.”

The legal authorities I have cited are consistent with the

definition of MacIyne in his impressive book on Unfair h
Dismissal (2ed) at page 229. The author stated:–
“There is no fixed Rule of Law defining the degree of misconduct
which will justify summary dismissal. The conduct complained of
has to be looked at in the context of (a) the nature of the business i
(b) the normal circumstances which prevail at the particular estab-
lishment and (c) the employees position. If the conduct, judged in
the light of the above circumstances is seen as a deliberate flouting
of the contractual conditions, then summary dismissal is justified”
(the italics is mine). j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 135

a For purposes of consistency, I also refer to the decision of

this Court in Alhaji Lasisi A. Yusuf v. The Union Bank of
Nigeria Ltd CA/J/24/88 yet to be reported.
b The second phase of issue (c) in the appellant’s brief is
central to the decision in this appeal. On this, I stand by my
view that the dismissal of the respondent is justified.
Granting that there are valid grounds to hold that the re-
c spondent’s dismissal was not wrongful, the damages
awarded as a result appear to have been computed on wrong
principles. The sum of N155,000 was awarded as special
damages and N18,000 as general damages, for a servant who
d was still virtually at the first rung of the managerial status in
the appellant’s employment. Respondent was at an annual
salary of approximately N21,000. It is clear that the trial
court did not sufficiently advert its mind to the fact that the
e heads of damages claimed were in the alternative. It was
double compensation to have awarded both. Furthermore,
the special damages were not specifically proved as laid.
I am inclined to the view of learned Counsel for the appel-
f lant as suggested earlier, that the learned trial Judge was
considerably affected by moral and non-legal considerations
in his approach to assessment of damages. He observed:–
“. . . Apart from the anxiety the plaintiff was no doubt put in a
g state of discomfort having been thrown into the consuming fires of
the current state of unemployment in the country. He was incon-
venienced by the irregular and arbitrary abuse of power by the
defendant. . . I accept and find that the plaintiff is entitled to some
h measure of general damages.”
This, I fear, is irrelevant in the assessment for damages
arising from wrongful dismissal of an employee. For this
proposition I have reminded myself that the case before the
i court below was not that of defamation.
In Addis v. Gramophone Company Ltd (1909) A.C. 488 at
491, the guideline was provided thus:–
“Where a servant is wrongfully dismissed from his employment
j the damages for the dismissal cannot include compensation for the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
136 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

manner of the dismissal, for his injured feelings or for the loss he a
may sustain from the fact that the dismissal of itself makes it more
difficult for him to obtain fresh employment.”
The principle stated was adopted and followed in the deci- b
sion in The International Drilling Company Nigeria Ltd v.
Ajijala (1976) 1 All N.L.R. (Part 1) 117 where Obaseki JSC
held:–
“It was outside the province of the learned trial Judge to look c
anywhere for terms of termination of the contract other than in
Agreement Exh. A. The principles of law governing the award of
damages were stated recently by this court in (1) Western Nig.
Development Corporation v. Jimoh Abimbola 1966 N.M.L.R. 381
at 382 (2) Nigeria Produce Marketing Board v. A.J. Adewunmi d
(1972) 1 All N.L.R. (Part 2) Page 433. In the latter case we stated
the law as follows at page 437.”
Ajegbo JSC in Western Nigeria Development Corporation v.
Jimoh Abimbola (supra) had earlier declared:– e
“. . . The plaintiff was given a letter of appointment Exh. H para-
graph 5 of that letter reads as follows: ‘Your employment may be
terminated by the Board or yourself by giving one month’s notice
in writing or by paying one month salary in lieu of such notice f
except in the case of dismissal for an offence prejudicial to the
interest of the Board. The plaintiff’s appointment was governed by
the contract to which he entered at the time of his appointment. If
he had been given one month’s notice before termination of his
appointment he would have had no claim whatever on the corpora- g
tion. But he was not given notice and he is entitled to one month
salary in lieu of notice. That is all he can get as damages; other
matters that the Judge considered are irrelevant.”
All the grounds of appeal filed and argued having succeeded h
along with the issues tied to them in the appellant’s brief of
argument, this appeal succeeds.
As the claims of the plaintiff/respondent are not estab-
lished, I will refrain from making my own assessment of the i
damages I consider reasonable.
In the end, this appeal succeeds and is hereby allowed. The
judgment of Ike Okoye J is consequently set aside and an
order for the dismissal of the plaintiff’s/respondent’s claims j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Ndoma-Egba JCA
Nigeria-Arab Bank Ltd v. J.E.A. Shuaibu 137

a substituted. Costs is assessed and fixed at N50 (Fifty Naira).

If the judgment hereby set aside before this appeal has been
satisfied, the plaintiff/respondent shall disgorge on the terms
b awarded.
ADIO JCA: I have had the privilege of reading in draft, the
judgment just delivered by my learned brother, Ndoma-Egba
JCA, with which I agree. I also abide by the consequential
c order including the order for costs.
OKEZIE JCA: After reading the judgment of my learned
brother, Ndoma-Egba JCA, in this appeal, I have considered
it unnecessary to state my own reasons which agree in all
d respects with his own, I therefore adopt them as mine.
Appeal allowed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

138 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Union Bank of Nigeria Limited v. Sax (Nig.)

Limited and others
b
COURT OF APPEAL, KADUNA DIVISION
OKUNOLA, AIKAWA, MOHAMMED JJCA
Date of Judgment: 16 MAY 1991 Suit No.: CA/K/146/90

Banking – Loan – Interest on – Rate of – Whether bank can c

change unilaterally
Mortgage – Interest carrying even in absence of express
provision
Facts
This was an appeal against the judgment of Gbadeya J, of
Kwara State High Court, Ilorin, delivered on 28th June,
1988. The facts of this case briefly put were as follows:– e
The respondents/cross-appellants obtained a loan from the
appellant. The written agreements on the loan were exhibits
25, 26 and 27 which provided that the respondents/cross-
appellants would pay interest on the loan. Both parties f
agreed that the debt owed the appellant by the cross-
appellant/respondents (hereinafter referred to as the respon-
dents) stood at N304,120 as at 1st February, 1986. The trial
court gave judgment on 29th June, 1989 in this with 11% g
interest per annum from 1st February, 1986 until the loan is
fully paid. There is a dispute as to the rate of interest charge-
able on the loan from 3rd September, 1987, the date of ex-
hibit 24, up to the date of judgment (29th June, 1989), hence h
this appeal by the appellant herein against the decision of the
High Court. The respondent also cross-appealed.
Held –
1. The law as it stands today is that where the interest is i
fixed the bankers cannot alter it unilaterally without an
agreement with the borrower. This is why it is manda-
tory on the banker to communicate such increase to and
get the consent of the customer. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Union Bank of Nigeria Ltd v. Sax (Nig.) Ltd and others 139

a 2. By the universal custom of bankers a banker has the

right to charge simple interest at a reasonable rate on all
overdrafts.
b 3. However, when considering whether interest is payable
on overdrafts Nigerian courts must, inter alia, have a re-
gard to the custom of bankers in Nigeria.
4. A mortgage debt carries interest even in the absence of
c an express provision. In the light of the foregoing it is
not unconscionable for the bank to charge the 11% inter-
est on the overdraft during the period of the negotiations
between the parties for additional facility.
d Appeal dismissed.

Cases referred to in the judgment

e Nigerian
Enahoro Co Ltd v. Bank of West Africa Ltd (1971) 1 A.L.R.
Comm. 180
National Bank of Nigeria Ltd v. Maja (1967) 2 A.L.R.
f Comm. 327
Union Bank of Nigeria Ltd v. Ozigi (1991) 2 N.W.L.R. (Part
176) 677

g Foreign
Crosskill, Bower, Bower v. Turner (1863) 32 L.J. Ch.D. 540
at 544
Gwyn v. Godby (1812) 4 Taunt 346
h Re Kerr’s Policy (1869) L.R. 8 Eq. 331

Counsel
For the appellant: Alhassan
i For the respondent: Baiyeshea
Judgment
OKUNOLA JCA: (Delivering the lead judgment) This is an
j appeal against the judgment of Gbadeyan J of Kwara State
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
140 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

High Court, Ilorin, delivered on 28th June, 1988. The facts a

of this case briefly put are as follows:–
The respondents/cross-appellants obtained loan from the
appellant. The written agreements on the loan are exhibits b
25, 26 and 27 which provide that the respondents/cross-
appellants shall pay interests on the loan. Both parties
agreed that the debt owed the appellant by the cross-
appellant/respondents (hereinafter referred to as the respon- c
dents) stood at N304,120 as at 1st February, 1986. The trial
court gave judgment on 29th June, 1989 in this with 11%
interest per annum from 1st February, 1986 until the loan is
fully paid. There is dispute as to the rate of interest charge-
able on the loan from 3rd September, 1987, the date of ex-
hibit 24, up to the date of judgment (29th June, 1989), hence
this appeal by the appellant herein against the decision of the
High Court. The respondent also cross-appealed. Both par- e
ties filed their briefs of argument.
From the grounds of appeal filed by both parties, the fol-
lowing issues arise for determination in both the appeal and
cross-appeal:– f
1. Whether the written agreements between the parties (i.e.
exhibits 25, 26 and 27) bind the appellant to grant addi-
tional loan to the respondents.
g
2. Whether the failure and/or refusal of the appellants to
grant additional facilities to the respondents despite as-
surances given by the appellants frustrated and ruined
the business of the respondents having regard to the evi- h
dence adduced at the trial court.
3. Whether if the answer to issue No. 2 is in the affirmative
it is unconscionable for the appellants to charge any in-
terest whatsoever on the overdraft facility it granted to i
the respondents in 1982.
4. Whether on a careful perusal of exhibits 25, 26 and 27
any rate of interest was agreed upon by the parties or
whether any interest was fixed at all and, if not, whether j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
Union Bank of Nigeria Ltd v. Sax (Nig.) Ltd and others 141

a such an uncertain and ambiguous contract can be en-

forced.
5. Whether the appellants could charge any interest higher
b than 11% on the overdraft it granted to the respondents
having regard to the evidence placed before the court.
Both parties relied on their briefs filed herein and made oral
c submission in respect of certain issues for emphasis. In this
regard learned Counsel for the appellants Ibrahim O. Alhas-
san submits with respect to exhibit 24 in which the respon-
dent was informed of the variation of the interest rate that, if
the learned trial Judge had made findings in respect of this
d
exhibit, he would have come to a different conclusion.
Learned Counsel also adopts the appellant’s reply to the
cross-appellant’s brief. He contended that the gist of the
cross-appeal is that the appellant’s action (i.e. refusal to
e grant an additional loan facility) frustrated the cross-
appellant’s/respondent’s business.
Learned Counsel for the respondent, after adopting his
f brief, submitted that the appellant could not vary the interest
rate chargeable on the overdraft from 11% which was the
lending rate between 1980 and 1982 when the overdraft was
granted to any other arbitrary rate of interest without the
g consent of the respondent. He referred to the evidence of
PW1 on oath to the effect that they did not agree to any
higher rate of interest. He contended that this witness was
neither cross-examined nor did the other party give evidence
to the contrary. He argued that they merely relied on exhibits
h
25, 26 and 27 of the mortgage deed. He referred to Union
Bank v. Ozigi (1991) 2 N.W.L.R. (Part 176) 677 ante where
this Court held that banks had no right to arbitrarily increase
interest rate without communicating this to the debtor and
i the debtor agreeing thereto. He contended that in Ozigi’s
case the bank gave evidence at the court below of how they
increased interest whereas in the instant case the bank did
not give evidence but instead filed a counter affidavit which
j they later abandoned. He therefore urged the court to follow
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
142 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Ozigi’s case by dismissing the appeal. Since exhibit 24 came a

first before the suit was filed, it cannot take the place of oral
evidence they proffered.
On the cross-appeal, he submitted that the refusal of the b
bank to grant an additional facility to them after their initial
representation to grant same frustrated their business. He
appealed to the court to apply the doctrine of equity since
the bank could not deny the representation they made to c
them for the additional loan to buy raw materials. He con-
tended that it was unconscionable for the bank to turn
around to ask them to pay their indebtedness and charge
interest on the existing loan, particularly for the period they
were waiting for the additional loan. He therefore urged this
Court to give judgment in their favour.
By way of reply, learned Counsel for the appellant, Mr Al-
hassan, urged the court to distinguish the situation in Ozigi’s e
case from the instant case since all the evidence adduced in
the lower court were well considered with findings made by
the lower court whereas in the instant case exhibit 24 was
never considered. f
I have given due consideration to the records, parties’
briefs and their arguments viva voce in this appeal. From the
issues raised and canvassed by both parties, it appears that
issues (1)–(3) can be taken together since they all deal with g
whether or not the failure of appellants to grant additional
facilities to the respondents did not frustrate and ruin their
business while issues (4)–(5) simply deal with the question
as to whether the appellants could unilaterally charge inter- h
est rates on a loan or overdraft without an agreement with
the borrower. I shall start with the last primary issue encom-
passing issues 4 and 5 first and take the former last.
On the second primary issue relating to the unilateral al- i
teration of interest rates by the banks, the appellant’s Coun-
sel relying on exhibit 24, a letter communicating the new
interest rate of 21% and a penalty of 2% to the respondent
for this variation, referred to the standard clause in exhibits j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
Union Bank of Nigeria Ltd v. Sax (Nig.) Ltd and others 143

a 25, 26 and 27, the legal mortgage on the properties used by

the respondents to secure the overdraft under consideration.
The clause is the fashionable provision in mortgage agree-
b ments to be bound by any future review of interest by the
Central Bank of Nigeria. It will be recalled from the unchal-
lenged evidence of the respondent in the lower court that the
agreed rate of interest in this case was 11% per annum. This
c was not disputed by the appellant herein. The respondent’s
position is that it is this 11% interest that should apply and
not the one based on the standard clause in exhibits 25–27
for variation of the interest rate which is a contract to the
d future, thus offending against the doctrine of certainty in
contract. The contention of both sides came for considera-
tion recently by this Court in a case which is in pari materia
with the one under consideration as it also centred on the
standard clause in the legal mortgage in that case as in this
e
case. In fact the clause was couched in exactly the same
language as those in exhibits 25, 26 and 27 in the instant
case. This was the case of Union Bank of Nigeria Ltd v. Prof
Albert Ojo Ozigi (1991) 2 N.W.L.R. (Part 176) 677. In that
f
case, the bank, which was the same as the one in the instant
case offered no evidence to justify a variation in the interest
rate but relied solely on the standard clause in their deed of
legal mortgage which is exactly the same as in the instant
g case. The respondent gave unchallenged evidence to the
effect that at the time of getting the overdraft, 11% was the
agreed interest rate. The bank as in the instant case insisted
on the prevailing interest rate based on the standard clause.
h The issue that came for consideration was, as in the instant
case, whether in a situation where the rate of interest charge-
able on a loan taken from a banker is fixed, the banker can
alter it unilaterally without an agreement with the borrower.
i The Court of Appeal at 692 answered this question per
Ogundare, JCA as follows:–
“As to whether the appellant could unilaterally increase the inter-
est rate the defendant pleaded the Central Bank of Nigeria Credit
j Policy Guidelines for 1987 fiscal Year as amended; throughout the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
144 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

proceedings the said document was not tendered which was found a
by the trial court at page 265 lines 4–7 and 18–26; and that the
non-production is fatal to the case of the defendants: Shonibare v.
Ijale (1960) S.C.N.L.R. 384, Imana v. Robinson (1979) 3–4 S.C. 1
at 9–10. A fortiori as the appellant has not attached that finding, it b
therefore remains unassailable Nwabueze v. Obi Okoye (1988) 10–
11 S.C.N.J. 60: (1988) 4 N.W.L.R. (Part 91) 664. Also no evi-
dence was led as to any banking practice, usage or custom which
gave the appellant the right to unilaterally vary upwards interest c
rate. Enahoro and Co. Ltd v. Bank of West Africa Ltd (1971) 1
A.L.R. Comm. 180, 196–197; Larinde v. Afiko 6 W.A.C.A. 108;
Giwa v. Erinmilokun (1961) All N.L.R. 294, 296: (1961) 1
S.C.N.L.R. 377. It was submitted that the following cases cited by
the appellant were misleading: Shaw v. Standard Bank Ltd (1967)
1 A.L.R. Comm. 209: National Bank of Nigeria Ltd v. Awolesi
(1964) 1 A.L.R. Comm. 279. Besides, exhibits 4–4s at pages 88 to
107 of the records did not give any detail or even guidelines as to
the rate of interest being charged. DW1 could not say how the fig-
ures therein were arrived at. Also they were only sent to the plain- e
tiff at his request before the case. Therefore, Barclays Bank v.
Hassan cited by the appellant being a High Court case is also not
relevant as evidence of how 10% monthly compound interest was
calculated and shown on the account sent to the customer in that
f
case. See also Ricket v. B.W.A. Ltd (1960) 5 F.S.C. 113 at 188:
(1960) S.C.N.L.R. 227, where the Supreme Court held that com-
pound interest on an overdraft is only chargeable where the cus-
tomer agrees to it.”
g
From the above, it is conceded that the Central Bank of
Nigeria (hereinafter referred to as “CBN”) Credit Policy
Guidelines regulate the banking system. Section 14 of the
Banking Act, 1969 (now largely irrelevant though not re-
jected) does not touch the question of new interest rates h
displacing the old ones but this is what is in vogue today.
For example, in the interest rate policy for 1991 issued by
the CBN in circular Ref. No. DG/DM and BP/RD/Vol. 1/7
dated 2nd January, 1991, the CBN addressed the banks as i
follows:–
“1. In the Monetary Policy Circular No. 25 for fiscal year 1991
just issued, banks are required to observe a maximum
spread of 4 percentage points between their average cost of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
Union Bank of Nigeria Ltd v. Sax (Nig.) Ltd and others 145

a funds (including administrative expenses) and their maxi-

mum lending rates. This measure has become necessary be-
cause the regulation of interest rates had in the recent past,
been accompanied by a structure of deposit and lending
b rates which had been largely unresponsive to the steady de-
cline in inflation rate and increase in excess liquidity in the
system. Moreover, effective bank lending rates have di-
verged considerably from the market determined Minimum
c Rediscount Rate (MRR) by about 10 per cent.
2. In the light of these distortions, it has become evident that
some guidance is required for the orderly evolution of fi-
nancial markets and the promotion of growth and develop-
ment of the economy. As announced in the Budget Speech
d of Mr President, Banks’ lending rates should with immedi-
ate effect not exceed 21.0 per cent per annum. Furthermore,
banks are required to maintain savings deposit rates of not
less than 13.5 per cent per annum. The envisaged structure
e of interest rates would ensure a positive return on savings,
promote growth and development, as well as allow com-
petitive profit margins for banks on their credits.
3. In accordance with the normal banking practice, it is ex-
pected that the new lending rates will apply IMMEDI-
f
ATELY to all new and outstanding loans. However, Banks,
shall honour contractual rates in respect of existing
time/term deposits.”

g It can be seen from paragraph 3 of the above circular for

Interest Rate Policy for the current year 1991 that the new
lending rates will apply immediately to all new and out-
standing loans. There is no doubt that this will definitely
lead to a review of interest rates on existing facilities in the
h
banks. Agreed that this is the situation in which the banks
find themselves now and perhaps in the periods under re-
view, will it not be expedient for the banks to communicate
this to their customers and get their consent as the CBN bad
i done to them too via the various circulars and in compliance
with the requirement of our law? This, I hold that our banks
have failed and are failing to do. In the instant case, no such
effort was made by the bank. The question of complying
j with the guideline of the Supreme Court in the case of Rickett
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
146 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

v. B.W.A. Ltd (1960) 5 F.S.C. 113 at 118; (1960) S.C.N.L.R. a

212 that compound interest on an overdraft is only charge-
able where the customer agrees to it will not arise for im-
plementation. This is the problem confronting the banks in b
this country today which can only be solved by the banks
themselves by not taking the customers for granted in mat-
ters of interest rate. The law as it stands today is that, where
the interest is fixed, the bankers cannot alter it unilaterally c
without an agreement with the borrower. This is why it is
mandatory for the banker to communicate such increase to
and get the consent of the customer. This matter was clearly
brought into focus by Uthman Mohammed JCA in Ozigi’s
case (supra) at 697 paragraphs E–H and 698 paragraphs A
and B as follows:–
“This case has given me anxious moments on the charge of inter-
est which the bankers do in this country on loan agreement. After
reading the decision of Charles, J of an English High Court which e
is of persuasive authority over my decision I have to agree that
where the interest is fixed the bankers cannot alter it unilaterally
without an agreement with the borrower. Many a time in this
country, interests over loans are increased by bankers unilaterally. f
I have not come by a case where the borrower challenged an in-
crease in Bank interest over the rate agreed upon by the parties on
the day the agreement was signed.
I am not unmindful of the terms of the deed of mortgage signed by
respondent when he took the loan. Clause 3 of that agreement con- g
tained the following terms:–
‘All interest payable on the moneys hereby secured shall accrue
due from day to day at the rate from time to time stipulated by
the Bank and may be capitalised at such intervals as the Bank h
may from time to time prescribe but not more often than
monthly and added to the money hereby secured and shall
thereupon bear interest accordingly at the rate aforesaid.’
It seems to me that the Bank shall have a free hand, in this coun- i
try, to fix interest as it pleases without communicating same to the
borrower. I will unhesitatingly say that such a practice is wrong. It
is my view that the bank is under an obligation to communicate its
intention to increase the interest rate over and above the rate
agreed by the parties when the loan was secured. This will give the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
Union Bank of Nigeria Ltd v. Sax (Nig.) Ltd and others 147

a borrower notice of the increase of his liabilities so that if he has

any objection he could raise it. In the case in hand the bank went
on increasing the rates of interest without communicating same to
the respondent. In view of the opinion of the learned author in
b Halsbury’s Laws of England (4ed), Volume 3 paragraph 160 the
appellants are wrong to ignore such vital communication to the
respondent. I will stress where the learned author of Halsbury’s
opined that by the universal custom of bankers (the bank) has the
c right to charge simple interest at a reasonable rate on all overdraft.
See Crosskill v. Bower, Bower v. Turner (1863) 32 L.J. Ch. 540, 544.
It is my strong view that even in respect of loan agreements a
banker cannot raise an unusual rate of interest without obtaining
an express agreement with the borrower.”
d
It can be observed from clause 3 of the deed referred to
above that following words were used:–
“All interest payable on the moneys hereby secured shall accrue
from day to day at the rate from time to time stipulated by the
e
Bank . . .”
An examination of the definition of the word “stipulate”
from Concise Oxford Dictionary as meaning “mention” or
f insist upon an essential part of an agreement, demand as part
of a bargain or agreement, I agree with Ogundare JCA at
695 of Ozigi (supra) when he said:–
“The appellant therefore had an obligation under clause 3 to notify
the mortgagor Plaintiff Respondent of the clause in and demand
g
interest rates from time to time starting with the offer of 11% in
exhibit 1. Failure to do this nullifies the variation of interest rate in
that clause and fixed the rate at 11% p.a.”
Now that I have settled the issue of the interest rate payable
h
on the overdraft under review, it is necessary to consider the
second primary issue of whether or not it is unconscionable
for the respondent to pay any interest on the overdraft/loan
under review since the rejection to grant the respondent the
i additional banking facility promised by the appellant ruined
the respondent’s business thereby causing the delay of re-
spondents in fulfilling their obligations to the bank. I have
considered the arguments of both parties on this issue. To
j start with, it can be observed that there was ample evidence
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
148 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

of negotiation for an additional loan facility between the a

respondents and appellants which finally broke down. This
was clearly put by the learned trial Judge at page 208 lines
22–end and page 209 lines 1–18 thus:– b
“Upon a careful perusal of all the exhibits, not only is there no
firm intention and promise, by the defendant Bank to give addi-
tional facility, everything still being at the negotiation stage, there
is no conclusive, binding and enforceable agreement on same. (See c
Co-Operative Bank of Eastern Nigeria v. Maria Eke (1979) 2 FNR
190). There is no agreement and, nay, duty on the defendant Bank
to give a loan just for the asking. There is no discernible firm in-
tention and promise in the Bank’s letters to the Plaintiffs. I am
unable to find any frustration to the plaintiff’s business by the de-
fendant Bank. In the light of the foregoing, it is not unconscion-
able for the Bank to enforce that which is mutually agreed, or,
even when, it is not expressly agreed, in the normal banking prac-
tice it is an implied term that an interest will be charged on the
overdraft facility. (See the unreported decision of this Court in Suit e
No: KWS/76/85 International Bank for West Africa Ltd v. Chief
Jimoh Anibilowo Shittu delivered on 30th May, 1986).”

I agree with the learned trial Judge on the above pro-

f
nouncement more so when it is viewed that it is trite that by
the universal custom of bankers, a banker has the right to
charge simple interest at a reasonable rate on all overdrafts
(see Crosskill v. Bower, Bower v. Turner (1963) 32 L.J Ch.
540, 544 and Gwyn v. Godby (1812) 4 Taunt 346). However, g
when considering whether interest is payable on overdrafts
Nigerian Courts must, inter alia, have a regard to the custom
of bankers in Nigeria. In this regard the Supreme Court has
pointed out in Enahoro Company Ltd v. Bank of West Africa h
Ltd (1971) 1 A.L.R. Comm. 180 that reliance on English
Banking custom, as established by decisions of English
courts, is inappropriate. Thus in National Bank of Nigeria
Ltd v. Maja and others (1967) 2 A.L.R. Comm. 327, Alex- i
ander J (as he then was) had earlier said:–
“There is no evidence . . . whether (the rate of interest charged
from time to time) is in accordance with the customs of bankers in
Nigeria or fair and reasonable.” j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
Union Bank of Nigeria Ltd v. Sax (Nig.) Ltd and others 149

a But such custom of bankers in Nigeria must be proved by

evidence until it is judicially noticed. Thus, in Enahoro v.
B.W.A. Ltd (supra) the court rejected the respondent bank’s
b contention that such custom applied without proof of the
banking customs in Nigeria and held, reversing the decision
of the trial court, that no interest was payable by either of the
defendants on a huge amount of overdraft since there was no
c evidence of any agreement to pay interest on the overdraft
guaranteed by the second defendant and no evidence was
called on the banking custom in Nigeria nor had the alleged
custom been judicially noticed in Nigeria. The situation in
the instant case is different in that clause 4 exhibit 25 consti-
d
tutes evidence of agreement by the parties to pay interest on
the overdraft which had been earlier on fixed at 11%. See Re
Kerr’s Policy (1869) L.R. 8 Eq. 331 where it was held that a
mortgage debt carries interest even in the absence of an
e express provision (see also Law of Real Property by R.E.
Megarry and H.W.R. Wade (4ed) (1975) page 946, para-
graph 3). In the light of the foregoing I hold that it is not
unconscionable for the bank to charge the 11% interest on
f the overdraft during the period of the negotiations between
the parties for additional facility.

This is particularly so as the parties never went beyond the

g process of negotiation and a conclusive and binding agree-
ment never emerged from the negotiations. I agree that the
negotiation terminated with exhibit 8, the letter of refusal of
the additional facility. There is no doubt that the bank could
h have acted more prudently as a shrewd business institution
to prevent the delay in the whole transaction. However, their
failure to be so shrewd is not grave enough to deprive them
of their interest. This is more so as they are not under any
obligation to provide the additional loan to the respondents
i
under exhibits 25, 26 and 27.

Having now dealt with the two primary issues, it is my

view that issues (1)–(5) have been taken care of since they
j are all subsumed in the two primary issues disposed of supra.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Okunola JCA
150 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

In sum, this appeal fails and it is dismissed. The judgment a

of Gbadeyan J of the High Court of Justice Ilorin dated 28th
June, 1989 that interest payable on the debt of N304,120
shall be at the rate of 11% per annum from 1st February, b
1986 until final settlement of same is hereby affirmed.
The cross-appeal on the decision of the aforesaid Judge
that the appellants’ conduct in failing to give additional
overdraft facilities to the respondents did not frustrate the c
respondents’ business (to escape payment of interest) also
fails for the reasons given above and it is accordingly dis-
missed.
Since each party has failed, each party shall bear its own d
costs.
MOHAMMED JCA: I agree.
AIKAWA JCA: I agree. e
Appeal dismissed.
Cross-appeal dismissed.
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 151

a
Dr. Gabriel Olusoga Onagoruwa v. Inspector-
General of Police and others
b COURT OF APPEAL, LAGOS DIVISION
TOBI, AWOGU, KALGO JJCA
Date of Judgment: 17 JULY 1991 Suit No.: CA/L/318/88

c Banking – Inspection of books of account of customer –

Section 7 Banker’s Books Evidence Act, 1879 – Attitude of
court
Banking – Section 7 Banker’s Books Evidence Act, 1879 –
d When can it be invoked
Practice and procedure – Ex parte application – What court
should consider

e Statute – Pre-1900 Statutes of general application – How

determined
Facts
The first appellant is a legal practitioner. He has his practice
f at No. 96 Lagos Street, Ebute-Metta, Lagos. Like most per-
sons of his societal status, he has a bank account. That ac-
count number is 4080. Like most legal practitioners, he has a
separate clients’ account. That account number is 4570.
g Similarly, like most law firms, the law firm of Chief G.
Ayodele Onagoruwa and Co has a chambers account. That
account number is 4425. It would appear that the first appel-
lant was, at the material time, a legal practitioner in the law
h firm of Chief G. Ayodele Onagoruwa. So also is the second
appellant. As a matter of fact, they instituted the action,
which is the subject of appeal “for themselves and on behalf
of the Law Firm of Chief G. Ayodele Onagoruwa and Co”.
i The first respondent is the Inspector-General of Police.
Section 195(1) of the 1979 Constitution establishes the of-
fice of the Inspector-General of Police. The second respon-
dent is the Commissioner of Police, Lagos State Command.
j Again the same subsection of the Constitution establishes
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

152 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

the office of Commissioner of Police for each State. The a

second respondent clearly comes under the subsection, as he
is the Commissioner of Police of Lagos State, in charge of
the State Command. b
The third respondent is the Attorney-General of the Fed-
eration. Section 138(1) of the Constitution establishes the
office of Attorney-General of the Federation. The fourth
respondent is the Attorney-General of Lagos State. Section c
176(1) of the Constitution establishes the office of the At-
torney-General for each State. The fourth respondent clearly
comes under the subsection, as he is the Attorney-General of
Lagos State. The fifth respondent is the National Bank of d
Nigeria Ltd. It is a bank duly incorporated in Nigeria. And
the last but not the least, is the sixth respondent. He is a
Judge of the High Court of Lagos State. Although he is sued
in his person as Honourable Justice M.A. Olugbani, the e
office he holds as a Judge is established under section
234(1) of the Constitution.
In order to really appreciate the basis of the action in the
lower court, it is necessary to go to the beginning of the f
matter. It all started between the first appellant and one
Alhaja Tayibat Adeniyi. She was a former client of the law
firm of Chief G. Ayodele Onagoruwa and Co. She lodged a
complaint on 8th April, 1988 with the Lagos State Director g
of Public Prosecutions, who, at the material time, was Mr
Abiodun Kessington. He is now a Judge of the High Court
of Lagos State. In the complaint, Alhaja Adeniyi made alle-
gations of fraud against the first appellant. h
On 9th June, 1988, the first appellant was duly charged
before the Chief Magistrate’s Court, Yaba for stealing. He
was charged as follows in charge No A/240/88:–
“That you Dr. Olu Onagoruwa (m) of Onagoruwa and Co. firm of i
Solicitors at No. 96 Lagos Street, Ebute-Metta, Lagos State be-
tween 1982 and 1988 did steal the sum of N720,000 being pro-
ceeds from the sale of land situated at Ifako and Gbagada in the
Lagos Magisterial District property of Alhaja Tayibat Adeniyi (f)
and thereby committed an offence contrary to section 390(8)(b) of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 153

a the Criminal Code Cap 31,Volume II, Laws of Lagos State of Ni-
geria, 1973.”
While the criminal action was pending in the Magistrate’s
b Court, Yaba, a document emanating from the office of the
second respondent was sent to the sixth respondent suppos-
edly for action. Since the document is of great importance in
the determination of the issues in this appeal, it is repro-
c duced hereunder:–
“IN THE SUPREME/MAGISTRATE’S COURT OF THE IKEJA
JUDICIAL DIVISION/MAGISTERIAL DISTRICT:
FROM THE COMMISSIONER OF POLICE,
d LAGOS STATE COMMAND HQTS, IKEJA.
20TH DAY OF JUNE, 1988.
SIR,
APPLICATIONS UNDER SECTION 7 OF THE BANKERS
e ACT 1897 (42 VIC. CII) (IN CONJUNCTION WITH SECTION
96 LAW OF THE EVIDENCE ORDINANCE CHAPTER 62
LAW OF FEDERATION OF NIGERIA, 1958; AND SECTION
45(1) OF THE INTERPRETATION ORDINANCE LAWS OF
THE FEDERATION: SECTION 40 MAGISTRATE COURT NO.
f
10 1955)
I hereby apply for an order of this Honourable Court that the In-
spector-General of Police or any Police Officer(s) be at liberty to
inspect and take copies of ledger and or any records of: MESSRS
g DR. GABRIEL OLUSOGA ONAGORUWA ‘M’ OF CHIEF G.A.
ONAGORUWA and CO., 24/26 LAGOS STREET, EBUTE-
METTA. Having particulars of accounts with: THE NATIONAL
BANK OF NIGERIA LTD of OYINGBO EBUTE-METTA, LA-
GOS BRANCH AND TO FREEZE ACCOUNTS NOS. 4425,
h 4080 AND 4570.
(Sgd.)
for: INSPECTOR GENERAL OF POLICE
i I, the undersigned Hon. Justice M.A. Olugbani hereby make an
order of this court on THE NATIONAL BANK OF NIGERIA
LTD of the aforementioned address to grant facilities as prayed
above to the Inspector-General of Police or the Police Officer
named herein as INSP. VICTOR OSUJI and SGT. C. UNDIE.
j Dated this day the 20th of June, 1988
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

154 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

(Sgd.) a
M.A. OLUGBANI
JUDGE”
On 22nd June, 1980, the fifth respondent addressed a letter b
with Reference No. LAW/CN/0.15447/30 to the first appel-
lant to the effect that accounts nos. 4425, 4080 and 4570
have been ordered to be frozen pursuant to a court order
dated 20th June, 1988. The letter reads:– c
“Ref: LAW/CN/0.1547/30
22nd June, 1988
Chief Dr. Olu Onagoruwa,
d
96, Lagos Street,
Ebute Metta,
Lagos.
Dear Sir, e
ACCOUNTS NOS. 4425
4080
4570
Please find attached photocopies of the Court order served on the f
Bank dated the 20th June, 1988 wherein the Bank was ordered to
freeze the above accounts which you operate at the Oyingbo
Branch of the Bank.
Since the Bank cannot flout the court order, it has no choice but to
g
obey it.
The above is therefore for your information.
Yours faithfully,
for: NATIONAL BANK OF NIGERIA LIMITED h
(Sgd)
M.I. OLAWOYE (MRS)
SENIOR LEGAL OFFICER (I/C)
MIO/AA” i
Attached to the above letter were two documents. One was
signed by the sixth respondent. The other was purportedly
signed by a Chief Magistrate whose name does not appear
on the document. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 155

a Arising from the above, the appellants brought an applica-

tion in the High Court under the Fundamental Rights (En-
forcement Procedure) Rules, 1979, praying for the following
b reliefs against the respondents:–
“1. A DECLARATION that an order purportedly made by
Honourable Justice Olugbani administratively in his Cham-
bers on the 20th of June, 1988 on an application by the
Commissioner of Police Lagos State Command on behalf of
c the Inspector-General of Police on a sheet of paper headed
“In the Supreme/Magisterial District” freezing current ac-
counts Numbers 4425, 4080 and 4570 kept in the Oyingbo
Branch of the National Bank of Nigeria Limited and being
d operated by the Applicants, constitute a flagrant and violent
violation of the Applicants’ constitutional rights under sec-
tions 33(4) and (5), 34 and 40 of the Constitution of the
Federal Republic of Nigeria, 1979.
2. A DECLARATION that the action of Police in freezing the
e current accounts of the applicants whilst criminal Charge
No. A/240/88 (Commissioner of Police v. Dr Olu Ona-
goruwa) is pending, amount to executive interference with
the proceedings of the criminal charge in the Magistrate
f Court and is therefore contrary to section 33(1), (4) and (5)
of the Constitution of the Federal Republic of Nigeria,
1979.
3. AN ORDER quashing the purported order made by Hon-
ourable Justice M.A. Olugbani dated 20th June, 1988 freez-
g ing the current accounts numbers 4425, 4080 and 4570
being operated or kept by the Oyingbo Branch of the Na-
tional Bank of Nigeria Limited.
OR ALTERNATIVELY
h AN ORDER defreezing the current accounts numbers 4425,
4080 and 4570 being kept at the Oyingbo branch of the Na-
tional Bank of Nigeria Limited by the Applicants.
4. AN ORDER directing the National Bank of Nigeria Lim-
i ited to continue the banking operations in respect of the cur-
rent accounts numbers 4425, 4080 and 4570 as if the
purported order of the Honourable Justice M.A. Olugbani
never existed.
5. A DECLARATION that the order made by Justice
j M.A. Olugbani consequent upon the application of the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

156 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Commissioner of Police on behalf of the Inspector-General a

of Police on the 20th of June, 1988 freezing the current ac-
counts numbers 4425, 4080 and 4570 operated by the Ap-
plicants at the Oyingbo Branch of the National Bank of
Nigeria Limited is unconstitutional, illegal, null and void in b
that no law authorises the Police and Justice M.A. Olugbani
to freeze the current account as was done in this respect.
6. AN INJUNCTION restraining the Respondents whether by
themselves, their agents, servants and or privies from fur- c
ther interference in any manner whatsoever with the normal
operations of the accounts numbers 4425, 4080 and 4570
operated by the applicants at the Oyingbo branch of the Na-
tional Bank of Nigeria Limited to the detriment of the Ap-
plicants. d
7. N500,000 (Five hundred thousand naira) as exemplary
damages against the Inspector-General of Police, Commis-
sioner of Police of Lagos State Command and Honourable
Justice M.A. Olugbani jointly and severally for unlawful in-
terference with the current accounts of the Applicants. e
AND for such further order or orders as this Honourable Court
may deem fit to make in the circumstances upon the grounds set
out in the copy statement served along with this application.
AND FURTHER TAKE NOTICE that at the hearing of this appli- f
cation the Applicants will rely on the affidavit of Dr. Gabriel Olu-
soga Onagoruwa used in obtaining the leave of the said court and
served along with this application.”
The matter was heard by Agoro J (as he then was). After g
considering the application in some detail, he did not see his
way clear in granting it. He dismissed it.
Dissatisfied with the ruling, the appellants filed a notice of
appeal on seven grounds of appeal. h
Section 7 of the Bankers’ Books Evidence Act, 1879 is
hereby reproduced:–
“On the application of any party to a legal proceeding a court or
judge may order that such party be at liberty to inspect and take i
copies of any entries in banker’s book for any of the purposes of
such proceedings. An order under this section may be either with
or without summoning the bank or any other party, and shall be
served on the bank three clear days before the same is obeyed,
unless the court or judge otherwise directs.” j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 157

a Held –
1. It is clear from the wording of section 7 of the Bankers’
Books Evidence Act that before the section is invoked,
b there must be a legal proceeding within the meaning of
section 10 of the Act, which defines judicial proceeding
as “any civil or criminal proceeding or inquiry in which
evidence is or may be given and includes arbitration”. In
c other words, before a Judge can give an order under the
section, a legal proceeding must be in existence. And in
our context, the legal proceeding must be commenced in
accordance with the High Court of Lagos State (Civil
d Procedure) Rules, 1972 or any other enabling rules, such
as the Fundamental Rights (Enforcement Procedure)
Rules, 1979. It is never the intention of the draftsman
that an action is initiated by invoking the section itself.
e 2. The section vests in a Judge a discretionary power. This
is borne out by the use of the permissive “may” which
lacks the element of invariable compulsion or invariable
peremptory order. By the section a Judge has the juris-
f diction to grant the application. He also has the jurisdic-
tion to refuse it. There lies the discretionary power. Like
every other discretionary power, it must be exercised ju-
dicially and judiciously in the light of the circumstances
g of the case and not in vacuo or in vacuum.
3. In order to enable a Judge to exercise his discretionary
power under the section, an applicant must present be-
fore him sufficient materials. And this an applicant can
h do by way of affidavit with relevant exhibits, if neces-
sary or if need be. A bare application without more can-
not meet the adjectival requirements of the section 7
procedures. In such a situation, a Judge is entitled to
i hold that an applicant has not discharged the burden
placed on him. The above is in respect of the first limb
of the section.
4. By the second limb the application could be made ex
j parte or on notice. In other words, in this context the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

158 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

fifth respondent and the appellants may or may not be a

put on notice. Although by the section, an application ex
parte is valid, a Judge should be fairly reluctant or loathe
making an order on an application ex parte. And in the b
instant case where the accounts of the applicants had to
be frozen, a Judge would have no alternative than to put
them on notice. By that cautious judicial act, he would
have complied not only with the provisions of section c
33(1) of the 1979 Constitution but also with the audi al-
teram partem rule.
5. In the circumstances of the instant case, the sixth re-
spondent was in error in giving the order in an applica- d
tion ex parte, thus depriving the appellant of the right to
contest the application. The Judge is expected to exer-
cise utmost caution with a view not to expand the al-
ready onerous frontiers of the section beyond the reach e
of the applicants. This is more so when the section is a
direct violation of the common law principle of secrecy
between a banker and his customer as it relates to the
state of account of the latter. f
6. The determination of a statute as one of general applica-
tion will depend upon the manner and general content of
the particular statute vis-à-vis its contextual application.
If from the matter of the statute it is not capable of gen- g
eral application vis-à-vis the circumstances of the case,
the statute cannot be held to be one of general applica-
tion. In determining the manner of the statute test, the
court must examine the generality of the wordings of the h
particular statute.
7. The court would be reluctant to throw open to inspection
a party’s account in the bank kept by his bankers unless
a strong case were made out for doing so. But if a spe- i
cial case is made for the exercise of the Judge’s discre-
tion, then it is different.
8. A strong and special case must be an intense, ardent and
exceptional case. It must be a peculiar and distinctive j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 159

a case, in which the circumstances must be compelling. A

strong and special case must be beyond the ordinary
stream of affairs.
b 9. By the use of the two telling words “strong” and “spe-
cial”, a burden has been placed on the applicants who
want the inspection of the accounts. It entails, in the cir-
cumstances of this case, affidavit evidence, which
c should show a “strong and special case”.
10. The courts of this land have an adjudicatory duty to
discourage parties to bring motions ex parte in matters,
which in reality will directly affect the interest of an-
d other party. And even where such motions are brought, it
is in the interest of justice that they order that the motion
ex parte be made inter partes.
11. The second option in section 7 in which the appellants
e and the fifth respondent were not given an opportunity to
be heard before the accounts of the former were frozen is
unconstitutional. The section is ultra vires section 1(3)
thereof. The section therefore crumbles in its entirety
f since it is impossible to salvage the consistent aspect of it.
Appeal granted.

Cases referred to in the judgment

g Nigerian
A.G. Bendel State v. A.G. Federation (1982) 3 N.C.L.R. 1
A.G. v. John Holt and Co (1911–1914) 2 N.L.R. 1
h A.R.E.C. Ltd v. Amaye (1986) 3 N.W.L.R. (Part 31) 653
Adegoke Motors Ltd v. Adesanya (1989) 3 N.W.L.R. (Part
109) 250
Adigun v. A.G. Oyo State (1989) N.W.L.R. (Part 53) 678
i
Aiyetan v. N.I.F.O.R. (1987) 3 N.W.L.R. (Part 59) 48
Alade v. Alemuloke (1988) 3 N.W.L.R. (Part 69) 207
Atano v. A.G. Bendel State (1988) 2 N.W.L.R. (Part 75) 201
j Atiku v. Bodinga (1988) 2 N.W.L.R. (Part 76) 369
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

160 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Bello v. Diocesan Synod of Lagos (1973) 1 All N.L.R. (Part a

1) 247
Bisichi Tin Co Ltd v. C.O.P. (1963) N.N.L.R. 71
Braithwaite v. Folarin (1938) 4 W.A.C.A. 76 b
Bronik Motors v. Wema Bank Ltd (1983) 1 S.C.N.L.R. 296
Deduwa v. A.G. Bendel State (1988) 2 N.W.L.R. (Part 75)
201 c
Din v. A.G. Federation (1986) 1 N.W.L.R. (Part 17) 471
Dobadina v. Ambrose (1969) N.M.L.R. 24
Egbe v. Adefarasin (1985) 1 N.W.L.R. (Part 3) 549
d
Eliochin (Nig.) Ltd v. Mbadiwe (1986) 1 N.W.L.R. (Part 14)
47
Ezeani v. Ejidike (1964) 1 All N.L.R. 402
Ezeomi v. Aghere (1991) 4 N.W.L.R. (Part 187) 631 e
Gaji v. State (1975) 5 S.C. 61
I.G.P. v. Kamara (1934) 2 W.A.C.A. 185
Ilouno v. Chiekwe (1991) 2 N.W.L.R. (Part 173) 316 f
In Re Tradelinks International (Nig.) Ltd (1977) C.C.H.C.J.
1155
Iyere v. Duru (1986) 5 N.W.L.R. (Part 44) 665
g
Kanada v. Gov. Kaduna State (1986) 4 N.W.L.R. (Part 35)
361
Kotoye v. C.B.N. (1989) 1 N.W.L.R. (Part 98) 419
L.P.D.C. v. Fawehinmi (1985) 2 N.W.L.R. (Part 7) 300 h
Madukolu v. Nkemdilim (1962) 2 S.C.N.L.R. 341
Makeri v. Kafinta (1990) 7 N.W.L.R. (Part 163) 411
Mohammed v. Kano N.A. (1968) 1 All N.L.R. 424 i
Momoh v. Senate of the National Assembly (1981) 1
N.C.L.R. 21
Obikoya and Sons Ltd v. Gov. Lagos State (1987) 1
N.W.L.R. (Part 50) 385 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 161

a Olatunbosun v. NISER Council (1988) 3 N.W.L.R. (Part 80)

25
Oloba v. Akereja (1988) 3 N.W.L.R. (Part 84) 508
b Omoniyi v. Central Schools Board (1988) 4 N.W.L.R. (Part
89) 448
Onagoruwa v. Nwokedi (1982) 3 N.C.L.R. 547
c Peenok Investment Ltd v. Hotel Presidential Ltd (1983) 4
N.C.L.R. 122
Sachia v. Kwande Local Gov. (1990) 5 N.W.L.R. (Part 152)
548
d Skenconsult (Nig.) Ltd v. Ukey (1981) 1 S.C. 6
Sule v. Nigerian Cotton Board (1985) 2 N.W.L.R. (Part 5)
17
e Ukpai v. Okoro (1983) 2 S.C.N.L.R. 380
Williams v. Daily Times (1990) 1 N.W.L.R. (Part 124) 1
Yesufu v. A.C.B. Ltd (1976) N.M.L.R. 83

f Foreign
Arnott v. Hayes (1887) 36 Ch.D. 731
Cassell and Co Ltd v. Broome (1972) 2 W.L.R. 645
g Garnett v. Ferrand (1827) 6 B. and C. 611
Howard v. Beall (1889) 23 Q.B.D. 1.
Perry v. The Phosphor Brooze Co Ltd (1894) 71 L.T. 854
Rookes v. Bernard (1964) 1 All E.R. 367
h
Scott v. Stansfied (1868) L.R. 3 Ex. 200
Sirror v. Moore (1974) 3 W.L.R. 459
Waterhouse v. Barker (1924) 2 K.B. 759
i
Statutes referred to in the judgment
Nigerian
Constitution of the Federal Republic of Nigeria, 1979, sec-
j tions 1(1), (3), 33(1)
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

162 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

High Court Laws of Lagos State, section 11(1)(a) a

Interpretation Act (Cap 192), Laws of the Federation of
Nigeria, 1990, section 45(1)
Magistrate’s Court E.R. No. 10 of 1955, section 40 b
Police Act, 1967, sections 4, 24(1)

Foreign
Bankers’ Books Evidence Act, 1879, section 7 c

Book referred to in the judgment

De Smith’s Constitutional and Administrative Law 1973,
page 370 d

Counsel
For the appellants: Olanrewaju (with him Jacobs, Utulu-
John, Adam and Ndidi (Miss)) e
For the first, second and third respondents: Ekpo, Principal
State Counsel, Fed.
For the fourth and sixth respondents: Mrs Adeyemi, Lagos
f
State

Judgment
TOBI JCA: (Delivering the lead judgment) The first appel- g
lant is a legal practitioner. He has his practice at No. 96
Lagos Street, Ebute-Metta, Lagos. Like most persons of his
societal status, he has a bank account. That account number
is 4080. Like most legal practitioners, he has a separate
h
clients’ account. That account number is 4570. Similarly,
like most law firms, the law firm of Chief G. Ayodele Ona-
goruwa and Co has a chambers account. That account num-
ber is 4425. It would appear that the first appellant was at
the material time a legal practitioner in the law firm of Chief i
G. Ayodele Onagoruwa. So also is the second appellant. As
a matter of fact, they instituted the action, which is the sub-
ject of appeal “for themselves and on behalf of the Law Firm
of Chief G. Ayodele Onagoruwa and Co”. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 163

a The first respondent is the Inspector-General of Police.

Section 195(1) of the 1979 Constitution establishes the of-
fice of the Inspector-General of Police. The second respon-
b dent is the Commissioner of Police, Lagos State Command.
Again the same subsection of the Constitution establishes
the office of Commissioner of Police for each State. The
second respondent clearly comes under the subsection, as he
is the Commissioner of Police of Lagos State, in charge of
c the State Command.
The third respondent is the Attorney-General of the Fed-
eration. Section 138(1) of the Constitution establishes the
office of Attorney-General of the Federation. The fourth
d respondent is the Attorney-General of Lagos State. Section
176(1) of the Constitution establishes the office of the At-
torney-General for each State. The fourth respondent clearly
comes under the subsection, as he is the Attorney-General of
e Lagos State. The fifth respondent is the National Bank of
Nigeria Ltd. It is a bank duly incorporated in Nigeria. And
the last, but not the least, is the sixth respondent. He is a
Judge of the High Court of Lagos State. Although he is sued
f in his person as Honourable Justice M.A. Olugbani, the
office he holds as a Judge is established under section
234(1) of the Constitution.
In order to really appreciate the basis of the action in the
g lower court, it is necessary to go to the beginning of the
matter. It all started between the first appellant and one
Alhaja Tayibat Adeniyi. She was a former client of the law
firm of Chief G. Ayodele Onagoruwa and Co. She lodged a
complaint on 8th April, 1988 with the Lagos State Director
h
of Public Prosecutions, who, at the material time, was Mr
Abiodun Kessington. He is now a Judge of the High Court
of Lagos State. In the complaint, Alhaja Adeniyi made alle-
gations of fraud against the first appellant.
i
On 9th June, 1988, the first appellant was duly charged
before the Chief Magistrate’s Court, Yaba for stealing. He
was charged as follows in Charge No. A/240/88:–
“That you Dr. Olu Onagoruwa (m) of Onagoruwa and Co. firm
j of Solicitors at No. 96 Lagos Street, Ebute-Metta, Lagos State
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
164 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

between 1982 and 1988 did steal the sum of N720,000 being pro- a
ceeds from the sale of land situated at Ifako and Gbagada in the
Lagos Magisterial District property of Alhaja Tayibat Adeniyi (f)
and thereby committed an offence contrary to section 390(8)(b) of
the Criminal Code Cap 31Volume II, Laws of Lagos State of Ni- b
geria, 1973.”

While the criminal action was pending in the Magistrate’s

Court, Yaba, a document emanating from the office of the
c
second respondent was sent to the sixth respondent suppos-
edly for action. Since the document is of great importance in
the determination of the issues in this appeal, I should repro-
duce it hereunder:–
d
“IN THE SUPREME/MAGISTRATE’S COURT OF THE IKEJA
JUDICIAL DIVISION/MAGISTERIAL DISTRICT:
FROM THE COMMISSIONER OF POLICE,
e
LAGOS STATE COMMAND HQTS, IKEJA.
20TH DAY OF JUNE, 1988.

SIR,
f
APPLICATIONS UNDER SECTION 7 OF THE BANKERS
ACT, 1897 (42 VIC. CII) (IN CONJUNCTION WITH SECTION
96 LAW OF THE EVIDENCE ORDINANCE CHAPTER 62
LAW OF FEDERATION OF NIGERIA, 1958; AND SECTION
45(1) OF THE INTERPRETATION ORDINANCE LAWS OF g
THE FEDERATION: SECTION 40 MAGISTRATE COURT ER
NO. 10, 1955)
I hereby apply for an order of this Honourable Court that the
Inspector-General of Police or any Police Officer(s) be at liberty h
to inspect and take copies of ledger and or any records of:
MESSRS DR. GABRIEL OLUSOGA ONAGORUWA ‘M’ OF
CHIEF G.A. ONAGORUWA and CO., 24/26 LAGOS STREET,
EBUTE-METTA. Having particulars of accounts with: THE NA-
TIONAL BANK OF NIGERIA LTD of OYINGBO EBUTE- i
METTA, LAGOS BRANCH AND TO FREEZE ACCOUNTS
NOS; 4425, 4080 AND 4570.
(Sgd.)
for: INSPECTOR GENERAL OF POLICE j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 165

a I, the undersigned Honourable Justice M.A. Olugbani hereby make

an order of this court on THE NATIONAL BANK OF NIGERIA
LTD of the aforementioned address to grant facilities as prayed
above to the Inspector-General of Police or the Police Officer
b named herein as INSP. VICTOR OSUJI and SGT. C. UNDIE.
Dated this day the 20th of June, 1988.
(Sgd.)
M.A. OLUGBANI
c JUDGE”
On 22nd June, 1980, the fifth respondent addressed a letter
with Reference No. LAW/CN/0.15447/30 to the first appel-
lant to the effect that accounts nos. 4425, 4080 and 4570
d
have been ordered to be frozen pursuant to a court order
dated 20th June, 1988. The letter reads:–
“Ref: LAW/CN/0.1547/30
22nd June, 1988
e
Chief Dr. Olu Onagoruwa,
96, Lagos Street,
Ebute Metta,
Lagos.
f
Dear Sir,
ACCOUNTS NOS. 4425
4080
4570
g
Please find attached photo copies of the Court Order served on the
Bank dated the 20th June, 1988 wherein the Bank was ordered to
freeze the above accounts which you operate at the Oyingbo
Branch of the Bank.
h Since the Bank cannot flout the court order, it has no choice but to
obey it.
The above is therefore for your information.
Yours faithfully,
i for: NATIONAL BANK OF NIGERIA LIMITED
(Sgd)
M.I. OLAWOYE (MRS)
SENIOR LEGAL OFFICE (I/C)
j MIO/AA”
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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166 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Attached to the above letter were two documents. One was a

signed by the sixth respondent. The other was purportedly
signed by a Chief Magistrate whose name does not appear
on the document. b
Arising from the above, the appellants brought an applica-
tion in the High Court under the Fundamental Rights (En-
forcement Procedure) Rules, 1979, praying for the following
reliefs against the respondents:– c
“1. A DECLARATION that an order purportedly made by
Honourable Justice Olugbani administratively in his Cham-
bers on the 20th of June, I988 on an application by the
Commissioner of Police Lagos State Command on behalf of
the Inspector-General of Police on a sheet of paper headed
d
“In the Supreme/Magisterial District” freezing current ac-
counts Numbers 4425, 4080 and 4570 kept in the Oyingbo
Branch of the National Bank of Nigeria Limited and being
operated by the Applicants, constitute a flagrant and violent e
violation of the Applicants’ constitutional rights under sec-
tions 33(4) and (5), 34 and 40 of the Constitution of the
Federal Republic of Nigeria, 1979.
2. A DECLARATION that the action of Police in freezing the
current accounts of the applicants whilst criminal Charge f
No. A/240/88 (Commissioner of Police v. Dr Olu Ona-
goruwa) is pending, amount to executive interference with
the proceedings of the criminal charge in the Magistrate
Court and is therefore contrary to section 33(1), (4) and (5)
g
of the Constitution of the Federal Republic of Nigeria,
1979.
3. AN ORDER quashing the purported order made by Hon-
ourable Justice M.A. Olugbani dated 20th June, 1988 freez-
ing the current accounts numbers 4425, 4080 and 4570 h
being operated or kept by the Oyingbo Branch of the Na-
tional Bank of Nigeria Limited.
OR ALTERNATIVELY
AN ORDER defreezing the current accounts numbers 4425, i
4080 and 4570 being kept at the Oyingbo branch of the Na-
tional Bank of Nigeria Limited by the Applicants.
4. AN ORDER directing the National Bank of Nigeria Lim-
ited to continue the banking operations in respect of the cur-
rent accounts numbers 4425, 4080 and 4570 as if the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 167

a purported order of the Honourable Justice M.A. Olugbani

never existed.
5. A DECLARATION that the order made by Justice M.A.
b Olugbani consequent upon the application of the Commis-
sioner of Police on behalf of the Inspector-General of Police
on the 20th of June, 1988 freezing the current accounts
numbers 4425, 4080 and 4570 operated by the Applicants at
the Oyingbo branch of the National Bank of Nigeria Lim-
c ited is unconstitutional, illegal, null and void in that no law
authorises the Police and Justice M.A. Olugbani to freeze
the current account as was done in this respect.
6. AN INJUNCTION restraining the Respondents whether by
themselves, their agents, servants and or privies from fur-
d ther interference in any manner whatsoever with the normal
operations of the accounts numbers 4425, 4080 and 4570
operated by the applicants at the Oyingbo branch of the Na-
tional Bank of Nigeria Limited to the detriment of the Ap-
e plicants.
7. N500,000 (Five Hundred Thousand Naira) as exemplary
damages against the Inspector-General of Police, Commis-
sioner of Police of Lagos State Command and Honourable
Justice M.A. Olugbani jointly and severally for unlawful in-
f terference with the current accounts of the Applicants.
AND for such further order or orders as this Honourable Court
may deem fit to make in the circumstances upon the grounds set
out in the copy statement served along with this application.
g AND FURTHER TAKE NOTICE that at the hearing of this appli-
cation the Applicants will rely on the affidavit of Dr. Gabriel Olu-
soga Onagoruwa used in obtaining the leave of the said court and
served along with this application.”
h The matter was heard by Agoro J (as he then was). After
considering the application in some detail, he did not see his
way clear in granting it. He dismissed it.
Dissatisfied with the ruling, the appellants filed a notice of
i appeal on seven grounds of appeal. Briefs passed among the
parties. Learned Counsel for the appellants formulated seven
issues for determination; learned Counsel for the first, sec-
ond and third respondents formulated five issues, while
j learned Counsel for the fourth and sixth respondents six
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
168 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

issues. The fifth respondent did not file any brief. Neither was a
it represented by Counsel. The briefs run into several pages.
At the hearing in this Court, Mr Ayo Olanrewaju, repre-
sented the appellants while Mrs E. Ekpo, Principal State b
Counsel represented the first to third respondents. Both
Counsel made brief oral submissions in expatiation of their
briefs. The fourth and sixth respondents were not repre-
sented. Presenting the 87-page brief of the appellants, c
learned Counsel, Mr Olanrewaju, pointed out that there was
no legal proceedings between the first appellant and the first
respondent warranting the order given by Olugbani J in the
document already quoted above. He also pointed out that the d
appellants were not even given any notice that the accounts
would be frozen so that they could have an opportunity to
make adequate representation before any order was made.
To Counsel, it was all a two-man game between the first e
respondent and the sixth respondent.
Dealing with the Statutes under which the sixth respondent
purportedly acted upon as basis for freezing the three ac-
counts, Counsel submitted that none of them vested such f
power in the respondent. To Counsel, the sixth respondent
was even wrong to have entertained the application of the
first respondent for the inspection and examination of the
books or entries kept by the fifth respondent in the absence g
of affidavit evidence. Learned Counsel cited Arnott v. Hayes
(1887) 36 Ch.D. 731 and In Re Tradelinks International
(Nig.) Ltd (1977) 6 C.C.H.C.J. 1155.
h
Dealing with issue no. 2, learned Counsel submitted that
Agoro J (as he then was) was entitled to set aside the null
order or orders made by the sixth respondent. The only con-
dition precedent to such setting aside and which immedi-
ately confers validity on such order setting aside such null i
order or orders is that the order or orders sought to be set
aside must be clearly demonstrated to be null and void,
Counsel contended. He relied on Skenconsult (Nig.) Ltd and
another v. Ukey (1981) 1 S.C. 6; Ogbu v. Urum (1981) 4 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 169

a S.C. 1; Obimonure v. Erinosho (1966) 1 All N.L.R.; Madu-

kolu v. Nkemdilim (1962) 1 All N.L.R. 587; (1962) 2
S.C.N.L.R. 341; Ukpai v. Okoro (1983) 11 S.C. 231 at 264;
b (1983) 2 S.C.N.L.R. 380. He contended further that since the
sixth respondent had no jurisdiction to make the order or
orders, Agoro J (as he then was) was entitled to set aside the
order or orders so made. On the issue of jurisdiction, Coun-
c sel cited Oloba v. Akereja (1988) 3 N.W.L.R. (Part 84) 508
at 526; Ezenwosu v. Ngonadi (1988) 3 N.W.L.R. (Part 81) 163
at 168, Egbo v. Laguma (1988) 3 N.W.L.R. (Part 80) 109 at
113; Atiku v. Bodinga (1988) 2 N.W.L.R. (Part 76) 369 and
Alade v. Alemuloke (1988) 1 N.W.L.R. (Part 69) 207 at 215.
d
On issue no. 3, learned Counsel submitted that the act of
the sixth respondent violated the provisions of sections 33(1)
and 40 of the Constitution. Therefore section 7 of the Bank-
e ers’ Books Evidence Act, 1879 being inconsistent with the
rights of the citizens entrenched in the Constitution is void.
Counsel relied on Obikoya and Sons Ltd v. Governor of
Lagos State (1987) 1 N.W.L.R. (Part 50) 385 at 400;
f L.P.D.C. v. Chief Fawehinmi (1985) 2 N.W.L.R. (Part 7)
300; Adigun v. Attorney-General of Oyo State (1987) 1
N.W.L.R. (Part 53) 678 at 707; Otapo v. Sunmonu (1987) 2
N.W.L.R. (Part 58) 587; Onagoruwa v. Nwokedi (1982) 3
g N.C.L.R. 547 at 550 and Olatubosun v. NISER Council
(1988) 3 N.W.L.R. (Part 80) 25 at 47.

On issue no. 4 as it relates to the sixth respondent, learned

Counsel said that the judicial duty of a Judge which can only
h
be performed in exercise of judicial power, can be exercised
only when parties bring a dispute to the court or Judge for
determination. He cited Senator Adesanya v. The President
of the Federal Republic of Nigeria (1981) 5 S.C. 112; (1982)
i 2 S.C.N.L.R. 358 and Bronik Motors Ltd v. Wema Bank Ltd
(1983) 1 S.C.N.L.R. 296 at 336–337. If judicial duty can
only be properly exercised pursuant to a judicial power, and
judicial power in turn can be exercised properly and wor-
j thily only when controversies or disputes are submitted by
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
170 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

disputants or parties to a case to the court for determination a

or adjudication, it means, by appropriate understanding that,
where no disputes or controversies are submitted for deter-
mination, then there will be no judicial power in existence b
pursuant to which a judicial duty can be exercised, Counsel
argued. He submitted that in the instant case no controversy
or dispute that called for determination existed between the
appellants and the first and second respondents and no one c
was submitted to the sixth respondent for adjudication. This
clear absence of controversy or dispute calling for judicial
decision Counsel submitted, rendered the judicial power of
the sixth respondent non-existent. He referred the court to d
Ikonne v. C.O.P. and Nnannanwa v. Wachakwu (1986) 4
N.W.L.R. (Part 36) 473.

Counsel further submitted that where a judicial officer did

e
or omitted to do an act other than a judicial duty as in this
case, any order made pursuant to the doing of that act or
omission was not only void but the judicial officer could not
validly plead judicial immunity in a subsequent action for
f
damages against him since he had by himself, robbed him-
self of his judicial immunity by going outside his judicial
duty. Citing the case of Iyere v. Duru (1986) 5 N.W.L.R.
(Part 44) 665, learned Counsel submitted that the sixth re-
spondent could not claim judicial immunity as he did not act g
in exercise of any judicial power when he made the freezing
order. Since the sixth respondent made the order freezing the
bank accounts of the appellants pursuant to a non-existent
law, and injury was occasioned to the appellants in conse- h
quence thereby, the appellants’ claim for damages against
the sixth respondent had to succeed, once it was shown or
established that he, in making the freezing order, acted
unlawfully, illegally, invalidly, illegitimately and unconsti- i
tutionally, Counsel argued. To Counsel, the appellants did
not need to prove any particular injury before their claim for
damages could succeed. He relied on Adigun v. Attorney-
General, Oyo State (supra). j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 171

a Dealing further on the issue of damages as it relates to the

first and second respondents, Counsel, relying on the defini-
tion of the word “official” in Black’s Law Dictionary, sub-
b mitted that the first and second respondents’ acts, being
unauthorised, they could not be said to have performed their
official duties. Assuming (without conceding) that the act of
applying for a freezing order on the applicant’s bank ac-
c counts was actually authorised, the moment the act did not
conform to any particular statute or law in force in Lagos
State, made the act illegal, unlawful and invalid, Counsel
argued. Nowhere in the Police Act, 1967, was the first and
d second respondents authorised to freeze any citizen’s bank
account even when investigation into an alleged offence
committed by such a citizen, Counsel claimed.
Counsel contended that the act of the first and second re-
e spondents in freezing the appellants’ bank accounts whilst
criminal charge No. A/240/88 was pending amounted to
unlawful executive interference with the proceedings in the
Magistrate’s Court. It was for that reason illegal and bad, as
f it was no more than a course of force, Counsel submitted.
He called in aid Governor of Lagos State v. Chief Ojukwu
(1986) 1 N.W.L.R. (Part 18) 621 at 636 and Garba v. Fed-
eral Civil Service Commission (1988) 1 N.W.L.R. (Part 71)
g 449.

Justifying the appellants’ claim of N500,000 damages,

Counsel relied on Minister of Internal Affairs v. Shugaba
h (1982) 3 N.C.L.R. 915 and Kalu and another v. Mbuko
(1988) 3 N.W.L.R. (Part 80) 86 at 105.
On issue no. 5, learned Counsel submitted that the learned
trial Judge was in error when he dismissed the application of
i the appellants after coming to the conclusion that he had no
jurisdiction to entertain the matter. Citing Din v. Attorney-
General of the Federation (1986) 1 N.W.L.R. (Part 17) 471,
Counsel submitted that the trial Judge ought to have struck
j out the matter instead of dismissing it.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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172 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

On issue no. 6, Counsel submitted that the learned trial a

Judge was wrong in invoking suo motu the provisions of
sections 4 and 24(1) of the Police Act in justifying the freez-
ing order of the sixth respondent. He relied on Odiase v. b
Agho (1972) 3 S.C. 71 at 77; Ogiamen v. Ogiamen (1967) 1
All N.L.R. 191 at 196; Adeniji v. Adeniji (1972) 4 S.C. 10 at
17; Balogun v. A.C.B. Ltd (l972) 1 S.C. 77; Animashaun v.
Osuma (1972) 4 S.C. 200; Sagay v. M.N.I. (1977) 5 S.C. c
143; Shitta-Bey v. F.P.S.C. (1981) 1 S.C. 40. Counsel finally
urged the court to allow the appeal.
Presenting the brief of the first, second and third respon-
dents, Mrs E. Ekpo, Principal State Counsel, Federal Minis- d
try of Justice, submitted that the sixth respondent was
empowered by section 7 of the Bankers’ Books Evidence
Act, 1879 and section 11(1)(a) of the High Court Law, La-
gos State to freeze the bank accounts in the way he did. She e
further submitted that, by section 10 of the High Court Law,
the sixth respondent was entitled to fall back on English
Law. Counsel submitted that section 33(1) of the Constitu-
tion, which deals with fair hearing, was not excluded by the
f
Bankers’ Books Evidence Act. To Counsel, section 33(1)
envisaged the full hearing in substantive suits when both
parties would be heard and not in interlocutory matters. If
section 33(1) prohibited motion ex parte, “our Supreme
Court Judges would not have been emphasising the need to g
preserve the res”, Counsel said. She relied on Vaswani Trad-
ing Co v. Savalakh and Co (1972) 12 S.C. 77 at 82; Okafor
v. Nnaife (1987) 4 N.W.L.R. (Part 64) 131 at 138 and
Holman Brothers v. Kigo (1980) 5–7 S.C. at 60. h
Counsel submitted that a High Court Judge could only set
aside the judgment of a Judge of co-ordinate jurisdiction if
the judgment was a nullity. She called the court’s attention
to Skenconsult (Nig.) Ltd v. Ukey (1981) 1 S.C. 6; Aladeg- i
bemi v. Fasanmade (1988) 3 N.W.L.R. (Part 81) at 129 and
Uku v. Okumagba and others (1974) 3 S.C. 35 and Ilorin v.
Ondo CSC (1983) 4 N.C.L.R. 634. Counsel also contended
that, by virtue of section 6(6)(i) of the 1979 Constitution, the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 173

a sixth respondent and the lower court could exercise the

inherent jurisdiction conferred on them to decide and inter-
pret the provisions of section 7 of the Bankers Books Evi-
b dence Act. She relied on Adigun v. Attorney-General of Oyo
State (1987) 2 N.W.L.R. (Part 56) at 97. She added, how-
ever, that the inherent power did not entitle the court to
review its own decision. If it were otherwise, there would be
c no finality about any judgment of the court and every af-
fected litigant would bring further appeals ad infinitum.
In an effort to justify the action of the first and second re-
spondents, Counsel relied on sections 4 and 24 of the Police
d Act, 1967 and the 22-paragraph affidavit of Mr S. Yal, Dep-
uty Superintendent of Police. She claimed the averments
were not denied in the appellants’ affidavit.
Contending that a Judge is only bound by the facts
e pleaded, Counsel relied on George v. Dominion Flour Mills
Ltd (1963) 1 All N.L.R. 71; (1963) 1 S.C.N.L.R. 117 and
George v. U.B.A. Ltd (1972) 2 S.C. 24.
On the liability of the sixth respondent, learned Counsel
f submitted that a Judge of a Supreme Court of record was not
liable in tort for any judicial act performed by him within his
jurisdiction even though he was malicious. Reliance was
placed on Egbe v. Justice Adefarasin and others (1985) 1
g N.W.L.R. (Part 3) 549.
On the liability of the first and second respondents, Coun-
sel submitted that they could not be liable for acts lawfully
done within the performance of their duties. She relied on
h section 7 of the Bankers Books Evidence Act, 1879, and
sections 4 and 24 of the Police Act.
Distinguishing the facts of this case from those of Chief
Ojukwu v. Governor of Lagos State (supra) learned Counsel
i urged the court to dismiss the appeal as it lacked merit and
affirm the judgment of the lower court.
Mrs O.P. Adeyemi prepared the brief for the fourth and
sixth respondents. Counsel submitted in her brief that it was
j competent for the police to seek the order made by the sixth
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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174 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

respondent. She relied on section 53 of the Criminal Proce- a

dure Law (Cap 32), Volume II, Laws of Lagos State, section
4 of the Police Act and sections 10 and 11(1)(a) of the High
Court Law, Lagos State. b
Dealing with whether the order made by the sixth respon-
dent was void or voidable, learned Counsel referred to sec-
tion 7 of the Bankers Books Evidence Act, 1879 and
submitted that the section gave unlimited power to a Judge c
to order inspection of a bankers book before trial whether
the book related to the account of a party to the litigation or
to that of a third party. Counsel relied on Waterhouse v.
Barker (1924) 2 K.B. 759; South Staffordshire Tramways d
Co v. Ebbsmith (1985) 2 Q.B. 669; Perry v. Phosphor
Bronze Co Ltd (1894) 71 L.T. 854 and Arnott v. Hayes
(1887) 36 Ch.D. 731. Counsel submitted that it was open to
a party in a subsequent proceeding to plead that the decision e
of a court of limited jurisdiction was given without jurisdic-
tion and therefore a nullity, the fact that no proceeding had
been taken to set aside the decision notwithstanding. She
relied on Timitimi v. Amabebe (l953) 14 W.A.C.A. 374. f
Contending further that an order made by a court of compe-
tent jurisdiction even in ignorance of some essential fact
which went to the validity of the order was not void or a
nullity and the order stood and could not be ignored until it g
was set aside. Learned Counsel submitted that the order
made by the sixth respondent was neither void nor voidable,
and that the order stood.
Relying on section 88(1) of the High Court Law and the h
cases of Egbe v. Justice Adefarasin (supra); Onitiri v.
Ojomo 21 N.L.R. 19; Everett v. Grifiths and another (1921)
1 A.C. 631 at 632, Counsel submitted that the sixth respon-
dent was not liable in consequence of the order he made. i
Dealing with the ruling of the lower court, Counsel sub-
mitted that Agoro J (as he then was) was not wrong in refus-
ing to set aside the order made by the sixth respondent. She
called the court’s attention to section 6(5)(d) of the 1979 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 175

a Constitution and the cases of Barclays Bank of Nigeria Ltd

v. Central Bank of Nigeria (1976) 1 All N.L.R. 409 at 421,
Skenconsult Nig. Ltd v. Ukey (supra) and Macfoy v. U.A.C.
b (1962) A.C. at 152.
On the issue of Agoro J (as he then was) raising the provi-
sions of sections 4 and 24(1) of the Police Act suo motu,
Counsel submitted that the learned trial Judge did not exceed
c his duty as a Judge by relying on the sections. She relied on
Chief Sodipo v. Lemminkainen Oy (1986) 1 N.W.L.R. (Part
15) 220. Counsel finally urged the court to dismiss the ap-
peal as it lacked merit.
d
Having dealt with the submissions of all the Counsel, I
should now deal with each of the issues raised by the appel-
lants seriatim. The first issue deals with the statutes cited in
e the application addressed to the sixth respondent. First is
section 7 of the Bankers’ Books Evidence Act, 1879:–
“On the application of any party to a legal proceeding a court or
judge may order that such party be at liberty to inspect and take
f copies of any entries in banker’s book for any of the purposes of
such proceedings. An order under this section may be either with
or without summoning the bank or any other party, and shall be
served on the bank three clear days before the same is obeyed,
unless the court or judge otherwise directs.”
g
It is clear from the above wordings that before the section is
invoked, there must be a legal proceeding within the mean-
ing of section 10 of the Act, which defines “judicial pro-
ceeding” as “any civil or criminal proceeding or inquiry in
h
which evidence is or may be given and includes arbitration”.
In other words, before a Judge can give an order under the
section, there must be in existence a legal proceeding. And
in our context, the legal proceeding must be commenced in
i accordance with the High Court of Lagos State (Civil Proce-
dure) Rules, 1972 or any other enabling rules, such as the
Fundamental Rights (Enforcement Procedure) Rules, 1979.
It is never the intention of the draftsman that an action is
j initiated by invoking the section itself.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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176 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The section vests in a Judge a discretionary power. This is a

borne out by the use of the permissive “may” which lacks
the element of invariable compulsion or invariable peremp-
tory order. By the section a Judge has the jurisdiction to b
grant the application. He also has the jurisdiction to refuse it.
There lies the discretionary power. Like every other discre-
tionary power, it must be exercised judicially and judi-
ciously in the light of the circumstances of the case and not c
in vacuo or in a vacuum.
In my view, in order to enable a Judge to exercise his dis-
cretionary power under the section, an applicant must pre-
sent before him sufficient materials. And this an applicant d
can do by way of affidavit with relevant exhibits, if neces-
sary or if need be. A bare application without more cannot
meet the adjectival requirements of the section 7 procedures.
In such a situation, a Judge is entitled to hold that an appli- e
cant has not discharged the burden placed on him. The
above is in respect of the first limb of the section.
Now to the second limb, which is the second sentence. By
the second limb an application could be made ex parte or on f
notice. In other words, in our context the fifth respondent
and the appellants may or may not be put on notice. Al-
though by the section, an application ex parte is valid, a
Judge should be fairly reluctant or loathe making an order g
on an application ex parte. And in the instant case where the
accounts of the applicants had to be frozen, a Judge would
have no alternative than to put them on notice. By that cau-
tious judicial act, he would have complied not only with the h
provisions of section 33(1) of the 1979 Constitution but also
with the audi alteram partem rule.
In the circumstances of the instant case, the sixth respon-
dent was in error in giving the order in an application ex i
parte, thus depriving the appellants’ right to contest the
application. I expected the Judge to exercise utmost caution
with a view not to expand the already onerous frontiers of
the section beyond the reach of the applicants. This is more j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 177

a so when the section is a direct violation of the common law

principle of secrecy between a banker and his customer as it
relates to the state of account of the latter.
b
On the interpretation of the section, see generally Water-
house v. Barker (1924) 2 K.B. 759; South Staffordshire
Transways Co v. Ebbsmith (1895) 2 Q.B. 669; Perry v.
Phosphor Bronze Co Ltd (1894) 71 L.T. 854; Arnott v.
c Hayes (1887) 36 Ch.D. 731; Howard v. Beall (1889) 23
Q.B.D. 1; In Re Tradelinks International (Nig.) Ltd (1977) 6
C.C.H.C.J. 1155.

d There is still one more aspect. Does the section enjoin or

empower the sixth respondent to freeze the accounts of the
applicants? I have read the section a couple of times and I
cannot place my hands on any enabling provision.
e Let me take the next section – section 96 of the Evidence
Act. The section is rather long. I will therefore not reproduce
it here. Frankly, I am at a loss why section 96 is cited in the
application. The more I read it the more the section distances
f itself from the application. I do not see the nexus between
the application and section 96, a section that deals essen-
tially with secondary evidence. Or could the appropriate
subsection be subsection (2)(e)? I think not. On the section,
g see generally Bisichi Tin Co Ltd v. Commissioner of Police
(1963) N.N.L.R. 71; Dobadina and another v. Ambrose
(1969) N.M.L.R. 24; Yesufu v. A.C.B. Ltd (1976) N.M.L.R.
83.
h
That takes me to section 45(1) of the Interpretation Act.
The section provides thus:–
“Subject to the provisions of this section in so far as other provi-
i sion is made by any Federal Law, the common law of England and
the doctrines of equity, together with the statutes of general appli-
cation that were in force in England on the 1st day of January,
1900, shall be in force in Lagos and, in so far as they relate to any
matter within the exclusive competence of the Federal Legislature,
j shall be in force elsewhere in the Federation.”
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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178 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

This is the reception clause. By the subsection, the English a

common law, the doctrines of equity together with the stat-
utes of general application that were in force in England on
1st January, 1900 came into operation in Lagos subject to b
the qualifications placed under section 45(2) and (3). For
judicial interpretation of the subsection, see generally Attor-
ney-General v. John Holt and Co (1911–1914) 2 N.L.R. 1;
Inspector-General of Police v. Kamara (1934) 2 W.A.C.A. c
185 and Braithwaite and another v. Folarin (1938) 4
W.A.C.A. 76.
The question is, how relevant is the subsection to the issue
before us? Perhaps only to the extent that the Bankers’ d
Books Evidence Act, 1879 is a statute of general application.
Although I agree that the Bankers’ Books Evidence Act,
1879 is a statute of general application, I would like to make
the point that not all pre-1900 statutes qualify automatically e
as statutes of general application. The determination of a
statute as one of general application will depend upon the
manner and general content of the particular statute vis-à-vis
its contextual application. If from the matter of the statute it f
is not capable of general application vis-à-vis the circum-
stances of the case, the statute cannot be held to be one of
general application. In determining the manner of the statute
test, the court must examine the generality of the wording of g
the particular statute.
I now come to section 40 of the Magistrate’s Court E.R.
No. 10 of l955. The section provides thus:–
“In any cause a magistrate may on application of either party, or of h
his own motion, make such order for the inspection by the Court,
the parties or witnesses, of any movable or immovable property,
the inspection of which may be material to the proper determina-
tion of the question in dispute, and give such direction regarding
such inspection as the Magistrate may think of it.” i
The above section applies to a Magistrate. The sixth respon-
dent is not a Magistrate. He is a Judge of the High Court of
Justice. How does he come by the invocation of the above
section? What law authorises him to invoke a power of a j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 179

a Magistrate in limine or on the threshold? In law, the law

establishing it and not that establishing some other court
basically and generally binds a court of law. While a court
b exercising an appellate jurisdiction can draw attention to a
lower court for not complying with a provision of a statute
establishing it in the process of invoking its interpretative
jurisdiction, it is not competent to make use of a section of
c that statute as if it is bound by it. In the instant case the sixth
respondent had no business whatsoever with section 40 of
the Magistrate’s Courts Law, as basis for making the order.
And what is more, it does not appear to me that section 40 is
still applicable in Lagos State, having regard to section 43 of
d
the Magistrate’s Courts Law, which is however similarly
worded as section 40. And this raises not only a jurisdic-
tional problem but also a large jurisprudential problem. Can
a court of law invoke a non-existent law? In the instant case,
e was the sixth respondent entitled to invoke section 40 of the
Magistrate’s Court E.R. No. 10 of 1955, a non-existent law,
assuming (but without conceding) that he had jurisdiction to
so invoke it in the circumstances?
f
In law, a non-existent statute is dead. It is moribund and
cannot be saved or salvaged anymore. Certainly not by the
court. The legislature can by a subsequent legislative act
g give life to a dead law by a conscious act. A court of law is
not competent to make use of a dead statute.
I have examined the so-called enabling statutes in turn. I
now come to the larger issue. And it is this. I cannot find the
h sections of the laws empowering the sixth respondent to
freeze the bank accounts of the appellants or any other bank
accounts for that matter. I have since seen the problem. The
application form in its original content did not anticipate
i freezing of accounts. Let me state in pleno the relevant re-
quest as contained in the form:–
“I hereby apply for an order of this Honourable Court that the In-
spector-General of Police or any Police Officer(s) be at liberty to
j inspect and take copies of ledger and or any records of Messrs . . .”
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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180 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

That is the clear wording of the application. What is ex- a

pected of the first and second respondents is to fill in the
name of the affected person with the particulars of the ac-
counts to be inspected and the bank where this could be b
done. The first and second respondents did all that but
moved further and added the following:–
“. . .AND TO FREEZE ACCOUNTS NOS. 4425, 4080 AND
4570.” c
This is where they went wrong and that is the crux of the
action. If the first and second respondents had stopped at the
word “branch” in the application without the above addition,
this matter probably may not have assumed this large di- d
mension.
I have carefully gone through the briefs of both the first,
second and third respondents on the one hand, the fourth and
sixth respondents on the other, and I do not with respect, e
agree with the contentions of Counsel. I should point out
that the case of Arnott v. Hayes (supra), which learned
Counsel for the first, second and third respondents largely
relied upon support the case of the applicants. In the brief, f
Counsel quoted what Bowen J said in respect of section 7,
namely:–
“I also think that great caution should be exercised in acting under
this power, and I have no reason to doubt that Judges do exercise g
such caution . . . It seems to me obvious that the object of the sec-
tion being to enable the applicant to get copies of the entries, in-
spection is necessary in order to determine what entries should be
copied, and the Judge should in such a case be careful as far as
possible to limit the order to entries which may be wanted.” h
I have supplied the italics for emphasis only. A number of
questions arise from Arnott in the context of the exercise of
the purported power on the part of the sixth respondent. Did
he use “such caution” in the matter? Was he really “careful i
as far as possible to limit the order to entries which may be
wanted”? He did not. He went to “town” on an unguarded
voyage of discovery like Christopher Columbus, like Vasco
Da Gama and coming nearer home like Mungo Park. But j
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 181

a could he have done so in the circumstances of the law? No,

he ought not to have gone that far, despite what I may un-
guardedly call the “foreign element” in the application. And
b here “foreign elements” mean the element of freezing of the
accounts.
Learned Counsel also cited the case of Perry v. The Phos-
phor Bronze Co Ltd. In Perry an affidavit was filed. But in
c this case, an affidavit was not filed. Lindley LJ said in the
case:–
“The court would be reluctant to throw open to inspection a
party’s account in the bank kept by his bankers unless a strong
d case were made out for doing so . . . But if a special case is made
for the exercise of the judge’s discretion, then it is different.”
Two issues are involved in the above statement of Lindley
LJ quoted in the brief of first, second and third respondents.
e The first one is the caution that the court should be reluctant
to throw open to inspection a party’s account in the bank.
The rationale behind this is to protect the secrecy of com-
munication between a bank and its customers, particularly in
relation to the account. The second one is that the secrecy
f
can only be disturbed if a strong and special case is made. In
my view, a strong and special case must be an intense, ar-
dent and exceptional case. It must be a peculiar and distinc-
tive case, in which the circumstances must be compelling. A
g strong and special case must be beyond the ordinary stream
of affairs. By the use of the two telling words “strong” and
“special”, Lindley LJ has rightly thrown the burden on the
applicants who want the inspection of the accounts. How
h will the burden be discharged? Just by a completion of the
application form? I think not. It is much more than that. In
my humble view, it entails, in the circumstances of this case,
affidavit evidence, which should show a “strong and special
i case”. There was no such evidence and so the sixth respon-
dent could not have been satisfied to order the inspection of
the accounts, not to talk of freezing them.
Learned Counsel for the fourth and sixth respondents, in
j her effort to justify the application, relied on section 53(1) of
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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182 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

the Criminal Procedure Code. With the greatest respect to a

her, section 53(1) is not an authority for the act of the first
and second respondents. I think I should drop the first issue
now. I have said enough. b
I now go to the second issue. Let me state the principle of
law as adumbrated in the cases over the years. The general
position of the law is that a court of co-ordinate jurisdiction
has not the jurisdiction to set aside the judgment of another c
court of similar jurisdiction. That is the function of an appel-
late court. But this remains good law as long as it is regarded
as the general position of the law. It is not sacrosanct. It is
not the last word on the issue. There is an exception to the d
general position of the law. Let me state the exception.
Where an order of a court of co-ordinate jurisdiction is a
nullity, ab initio, it could be set aside by another court of
similar jurisdiction without much ado. This seems to be the e
trend of the decisions in Skenconsult (Nig.) Ltd and another
v. Ukey (1981) 1 S.C. 6 and the group of cases.
Learned Counsel for the appellants agrees with the above
position of the law. Learned Counsel for the first, second f
and third respondents also agree with the above position of
the law. Learned Counsel for the fourth and sixth respon-
dents does not seem to agree with the position.
In the instant case, the learned trial Judge, Agoro J (as he g
then was), when invited by Counsel for the applicants to set
aside the order of the sixth respondent, said in his ruling:–
“I regret that this High Court cannot accede to the request by the
Applicants for lack of jurisdiction in the matter because Honour- h
able Justice E. Olugbani presides over a court with co-ordinate
powers, duties and jurisdiction.”
Was the learned trial Judge correct in the circumstances of
the case before him? In Skenconsult (supra) which I had i
earlier referred to, Nnamani JSC of blessed memory, said:–
“It is, therefore, my view that it is the High Court from which the
Order complained of emanated that must set it aside not necessar-
ily the Judge of that High Court who originally made the order. In
the circumstances of this case, I hold that the High Court of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 183

a Bendel State presided over by Maidoh, J. ought to have set aside

the offending orders.”
Idigbe JSC (also of blessed memory) gave a helping hand:–
b “I agree that the High Court of Bendel State (not merely Ekeruche,
J. or Maidoh, J) had inherent power to set aside the orders in ques-
tion.”
In the more recent case of this Court in its Jos Division,
c Adio JCA in Sachia v. Kwande Local Government Council
and others (1990) 5 N.W.L.R. (Part 152) 548, while relying
on Skenconsult said at 556:–
“If the judgment of a court is a nullity because of lack of jurisdic-
d tion, the same court or other court of co-ordinate jurisdiction may
set aside the judgment.”
I should like to emphasise the point that there is only one
High Court of a State in each State of the Federation. That is
e the High Court of the State duly established under section
234(1) of the 1979 Constitution. That court consists of a
Chief Judge and other Judges. That is the position under
section 234(2)(a) and (b) of the same Constitution. There-
fore, if a Judge of the same High Court gives an order with-
f
out jurisdiction, another Judge of the same High Court
should be given an opportunity to have a look at the order
with a view to quashing it. That will keep the matter within
the same “house”. One can even say on the lighter side that
g after all they are brothers and it will be much more tolerable
on the part of the brother who gave the null order to have it
nullified by his brother than an appellate court for that mat-
ter. On a more serious breath, an order, which is a nullity, is
h something, which the person affected by it, is entitled to
have set aside ex debito justitiae (see Adegoke Motors Ltd v.
Dr. Adesanya and another (1989) 3 N.W.L.R. (Part 109)
250).
i Jurisdiction is the pillar upon which the entire case stands.
Filing of an action presupposes that the court has jurisdic-
tion. And in the context of the instant case, the first and
second respondents in presenting the application before the
j sixth respondent held the view that the sixth respondent had
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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184 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

jurisdiction to entertain it. But once the adverse party shows a

it, as it is shown here, that the court has no jurisdiction, the
foundation of the case is not only shaken but also entirely
broken. The case crumbles. In effect, there is no case before b
the court for adjudication. That is the end of the litigation,
unless the action is filed in a court of competent jurisdiction;
in which case it is resuscitated de novo.
In the instant case, while the criminal charge is pending in c
the Magistrate’s Court, Yaba, the application for freezing
the accounts of the appellants was made to the High Court,
Ikeja where the sixth respondent made the order. That apart
it is clear from my analysis of all the supposedly enabling d
sections of the laws, that in law the sections are not applica-
ble and therefore inapposite to the case. Therefore the order
the sixth respondent made is a nullity and the learned Judge,
Agoro J (as he then was) was perfectly entitled to set it e
aside. That he did not do so, is unfortunate.
I now go to the third issue. It is in respect of section 7 of
the Bankers’ Books Evidence Act, 1879 vis-à-vis section
33(1) of the 1979 Constitution. I had earlier reproduced the f
section. I will not repeat it here. The only relevant aspect
here is that the section vests in the Magistrate two options.
The first option is to put the bank or any other party on no-
tice. The second option is to take the application ex parte g
and deal with it accordingly. In the instant case, for reasons,
which are not apparent on the record, the sixth respondent
left the first option and invoked the second option.
h
It is elementary law that there are two types of applications
or motions. One is application ex parte, which is a proceed-
ing brought on behalf of one interested party without notice
to, and in the absence of the other. And the word “absence”
here means legal absence as opposed to physical absence. It i
is this type that the sixth respondent invoked. The second
one is the application on notice that is the application in
which the adverse party is put on notice thereof. It is an
application inter partes. j
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 185

a In determining whether an application should be brought

ex parte or on notice, the applicant cannot listen to the paro-
chial and sensitive dictates of his conscience or whims. So
b also is a Judge whose duty is to grant it. It is rather a hard
matter of hard law to be considered in the light of the pre-
vailing circumstances when the application is brought.
Generally an application ex parte could be made in two
c main circumstances. First, when time is the essence of the
application. Second, when from the nature of the applica-
tion, the interest of the adverse party will not be affected. In
these two circumstances a court will be right in exercising
d its discretion in granting an application ex parte.
But where the application will affect the interest of the ad-
verse party, a court of law should insist and order that the
adverse party be put on notice. There are two main ways of
e doing this. Either the court orders that the application ex
parte be served on the adverse party which automatically
makes it an application on notice or the applicant files a
separate application on notice. In a good number of cases,
f Counsel usually files the two applications simultaneously.
There exist some applications ex parte, which really do not
directly affect the legal rights of the adverse party. One such
application is for representative action. There are quite a few
g others. But in most cases, and it is a matter of experience,
applications directly affect the rights of the adverse party.
The law certainly frowns upon a situation where a court of
law grants such applications at the ex parte level.
h
Our jurisprudence, as an off-shoot of the common law tra-
dition of England is premised or predicated upon the adver-
sary system with its in-built rules of natural justice and fair
play, as opposed to the inquisitorial system, continental
i fame and integrity of the French prototype and the like. And
this position of the law is as old as the age of our imported
law which dates back to 1861, when the Englishman in his
colonising expedition floated from the shores of his native
j River Thames, the common law of his country to what later
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186 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

became known as Nigeria. The basic aim of the adversary a

system is to ensure that parties in litigation should be
equally treated with all fairness and candour to their mutual
egalitarian advantage. Where one party gets more advantage b
than the other, an appellate court will certainly intervene in
the interest of justice and fair play.

Apart from the common law system as stated above, we

c
have a written Constitution, which clearly provides for fair
hearing in the litigation process.

Section 33(1) of the Constitution clearly provides for it.

Whether a party in a case has got a fair hearing or fair trial d
depends upon the impression of a reasonable person or dis-
passionate visitor who was present at the trial; whether from
his observation justice has been done to the parties in the
litigation that he watched (see generally Mohammed v. Kano e
Native Authority (1968) 1 All N.L.R. 424; Alhaji Gaji v. The
State (197S) 5 S.C. 61; Omoniyi v. Central Schools Board
(1988) 4 N.W.L.R. (Part 89) 448).
f
The basic criteria and attributes of fair hearing include (a)
that the court or tribunal shall hear both sides not only in the
case but also in all material issues in the case before reach-
ing a decision which may be prejudicial to any party in the g
case; (b) that the court or tribunal shall give equal treatment,
opportunity and consideration to all concerned; (c) that the
proceedings shall be heard in public and all concerned shall
have access to and be informed of such a place of public
h
hearing; and (d) that, having regard to all the circumstances
in every material decision in the case, justice must not only
be done but must manifestly and undoubtedly be seen to
have been done (see Kotoye v. Central Bank of Nigeria
(1989) 1 N.W.L.R. (Part 98) 419; Adigun v. Attorney- i
General Oyo State (1987) 1 N.W.L.R. (Part 53) 678; De-
duwa v. Okorodudu (1976) 10 S.C. 329; Atano v. A.G.
Bendel State (1988) 2 N.W.L.R. (Part 75) 201; Okoduwa v.
The State (1988) 2 N.W.L.R. (Part 76) 333). j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 187

a Applications or motions ex parte in their strict content are

antithesis to both the common law principles of fair hearing
and section 33(1) of the Constitution. In respect of the com-
b mon law principles, the doctrine of audi alteram partem
comes into play. It simply means hear the other side (see
generally Aiyetan v. The Nigerian Institute of Oil Palm Re-
search (1987) 3 N.W.L.R. (Part 59) 48; Sule v. Nigeria
c Cotton Board (1985) 2 N.W.L.R. (Part 5) 17).
The burden is on the party alleging breach of the right to
fair hearing and indeed the audi alteram partem rule to
prove the breach. The party alleging must prove (a) that
d there was a matter before a court; (b) that he was not given
an opportunity to be heard; (c) that he had the right to be
heard, that is he had locus standi in the matter; (d) that even
if he was heard, the hearing was inadequate and therefore
e unfair. Have the appellants satisfied the above requirements
in the circumstances? I would think so. There is clear evi-
dence that the application, which resulted in the freezing of
their accounts, was granted by the sixth respondent without
f giving them a hearing. The order was made completely
outside them. The fifth respondent of the order informed
them. This resulted in their action in the lower court.
I think the courts of this land have an adjudicatory duty to
g discourage parties to bring motions ex parte in matters,
which in reality will directly affect the interest of another
party. And even where such motions are brought, it is in the
interest of justice that they order that the motion ex parte be
h made inter partes.
On the constitutionality or otherwise of section 7 of the
1879 Act, Agoro J (as he then was) said:–
“The learned counsel for the Applicants also said that his clients
i were not given the right to fair hearing under section 33(1) of the
1979 Constitution before Honourable Justice Olugbani made the
order dated 20th June, 1988. It seems that the short answer to that
complaint would be found in the language of section 7 of the 1879
Act in England to the effect, an order under this section may be
j made either with or without summoning the bank or any other
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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188 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

party. It seems perfectly clear that the learned Judge could make a
the said order as he did without hearing the bank concerned or the
other party to the legal proceeding.”
With respect, I part ways with the learned trial Judge here. It b
is trite law that where any statutory provision is in conflict
with the Constitution, the latter would prevail. This is the
essence of the supremacy clause built into section 1(1) of the
Constitution, vindicated by section 1(3) thereof. On the c
supremacy of the Constitution, see Momoh v. Senate of the
National Assembly and others (1981) 1 N.C.L.R. 21; Attor-
ney-General of Bendel State v. Attorney-General of the
Federation and others (1981) 1 N.C.L.R. 21; Kanada v.
Governor, Kaduna State (1986) 4 N.W.L.R. (Part 35) 361. d
As I indicated earlier, section 7 gave two options to the
sixth respondent. It is a well settled canon of statutory inter-
pretation that where the property rights of the citizen are
e
involved, as in the instant case, a court should lean in favour
of an interpretation which will vindicate the constitutional
rights of the citizen to property. I expected the learned Judge
to interpret section 7 in line with this basic canon. While it is
the position of the law that a court should not quickly jump f
to the conclusion that a particular statute is in violation of a
constitutional provision and therefore a nullity, it is also the
law that on no account should a court of law fail to protect
the Constitution in its interpretative jurisdiction. Being the g
supreme law of the land, the Constitution has precedence
over and above all laws including the “almighty” section 7
of the 1879 Act of England.
In the circumstances, I am of the firm view that the second h
option in section 7 in which the appellants and the fifth
respondent were not given an opportunity to be heard before
the accounts of the former were frozen is unconstitutional.
The section is ultra vires section 1(3) thereof. The section i
therefore crumbles in its entirety since it is impossible to
salvage the consistent aspect of it.
Now to the fourth issue. It deals with damages in respect of
the acts of the first, second and sixth respondents. I will j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 189

a take them in turn. The learned trial Judge held that they are
not liable to damages. As learned Counsel for the appellants
started with sixth respondent, I might as well follow that
b line.
The main issue in respect of the sixth respondent is
whether he is judicially immune from civil liability in re-
spect of the role he played in this matter. Judicial immunity
c arises from two angles: immunity under the common law
and immunity as provided by statutes. Judicial immunity,
though not provided for in the Constitution, is an important
common law safeguard of the independence of the judiciary
d as the third arm of government. As an important safeguard,
the courts have zealously and jealously guided and guarded
its application in the judicial process essentially in favour of
the judge qua adjudicator.
e The immunity of Judges for any acts done or words spoken
in their judicial capacity in a court of law is not conferred
for the protection or benefit of the Judges but for the benefit
of the public, which interest it is that the Judges should be at
f liberty to exercise their functions with independence and
without fear of consequences (see Scott v. Stansfied (1868)
L.R. 3 Ex. 200 at 223; Garnett v. Ferrand (1827) 6B and C
611 at 625). De Smith in his book on Constitutional and
g Administrative Law (1973) said at page 370:–
“Judicial immunities from suit are conferred not for the benefit of
judges but for the benefit of the administration of justice. The risk
that a judge may abuse his privilege by making gratuitously de-
famatory remarks for reasons of personal rancour is considered to
h be less than the risk of his abstaining for reasons of prudence from
condemning inequity in appropriate language.”
In the English case of Sirros v. Moore (1974) 3 W.L.R. 459,
the Court of Appeal said at 467 on the judicial immunity of
i
a Judge:–
“The words which he speaks are protected by an absolute privi-
lege. The orders which he gives, and the sentences which he im-
poses cannot be made the subject of civil proceedings against him.
j No matter that the Judge was under some gross error or ignorance,
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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190 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

or was actuated by envy, hatred and malice, and all uncharitable- a

ness, he is not liable to an action. The remedy of the party ag-
grieved is to appeal to a Court of Appeal or to apply for habeas
corpus, or a writ of certiorari, or take some such step to reverse
his ruling. Of course, if the Judge has accepted bribes or been in b
the least degree corrupt, or has perverted the course of justice, he
can be punished in the criminal courts. That apart, however, a
Judge is not liable to an action for damages. The reason is not be-
cause the Judge has any privilege to make mistakes or to do c
wrong. It is so that he should be able to do his duty with complete
independence and free from fear.”
In Egbe v. Justice Adefarasin and another (1985) 1
N.W.L.R. (Part 3) 549, the Supreme Court held (1) that a
d
Judge of a superior court of record is not liable in tort for
any judicial act performed by him within his jurisdiction
even though he be malicious; (2) that no action lies for acts
done or words spoken by a Judge in the exercise of his judi-
cial office, although his motive is malicious and the acts or e
words are not done or spoken in the honest exercise of his
office; (3) that the immunity granted at common law to the
Judge is based on public policy.
f
Now, I come to the statutory immunity. Section 88(1) of
the High Court Law of Lagos Cap 52 provides thus:–
“No Judge shall be liable for any act done by him or ordered to be
done by him in the discharge of his judicial duty, whether or not
within the limit of his jurisdiction to do so or order to be done the g
act in question.”
Learned Counsel for the appellants, Mr Olanrewaju took
time in examining the ambit of the expression “judicial
power” as it relates to the provision. While I am in sympathy h
with the argument of Counsel as it relates to the exercise of
judicial power, the operative words in the section are “judi-
cial duty”. The word “judicial” ordinarily means pertaining
to a Judge or court of justice. It also has the connotation of i
something established by statute or arising from the process
of law. “Judicial” in a nutshell means judge-like.
In the circumstances of the above definition, I cannot agree
with the fairly parochial and restricted definition given by j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 191

a Counsel to the expression in section 88(1) as relating only to

physical controversies or disputes between parties in a court
of law.
b In my humble view, a Judge outside the four walls of the
court, sitting as an adjudicator qua Judge, can perform judi-
cial duty. A Judge can perform his judicial duties in his
chambers. In Iyere v. Duru (1986) 5 N.W.L.R. (Part 44) 665,
c a case which learned Counsel relied upon heavily, Obaseki
JSC said at 682:–
“Judicial acts have not been confined to orders made while a tri-
bunal is sitting in court. The term ‘judicial’ does not necessarily
d mean acts of a Judge or legal tribunal sitting for the determination
of matters of law.”
See also Australian Apple and Pear Marketing Board v.
Tonking 66 C.L.R. 77.
e I think I should take the case of Iyere further, as Counsel
mainly relied on it. That case dealt with judicial immunity as
it relates to a justice of the peace. We are here dealing with a
Judge of the High Court, not a justice of the peace. I do not
f want to believe that they exercise similar judicial functions.
I do not also want to believe that they exercise similar juris-
diction. Apart from the clear difference in nomenclature,
they exercise quite different jurisdictions and judicial duties
g and functions. Therefore Iyere cannot be authority for the
case we have on our hands.
The word “judicial” may refer to the discharge of duties
exercisable by a Judge or Justice in court. Or to administra-
h tive duties which need not be performed in court, but in
respect of which it is necessary to bring to bear a judicial
mind, that is, a mind to determine what is fair and just in
respect of the matter under consideration.
i Flowing from this is the question whether the sixth re-
spondent, in giving the order in the application, performed a
judicial duty within the meaning of section 88(1), as to en-
able him to seek the immunity in the subsection. Did he
j merely exercise a clerical or ministerial function or a judicial
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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192 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

or quasi-judicial function? Generally, and as a matter of a

experience, a number of judicial officers (and I extend this
expression for this purpose to the magisterial bench) see
themselves as exercising clerical or ministerial functions. A b
good number of them do not take the time and the trouble to
read carefully the court process before they append their
signatures. To such judicial officers, it is merely a clerical or
ministerial function. c
But that is wrong. That is rather a careless way of handling
a serious judicial or quasi-judicial duty. A judicial officer is
certainly not a robot to act with mechanical automation to
sign a court process without examining it. He has a legal d
duty to examine the four walls of the process to satisfy him
that it complies with the law before signing it. And, to that
extent, he performs either his Judicial or quasi-judicial du-
ties or functions, depending upon the nature of the process e
before him.
In the instant case, I am of the opinion that the sixth re-
spondent performed a judicial duty within the meaning of
section 88(1) of the High Court Law, when he gave the f
order freezing the accounts of the appellants. He is therefore
immune from civil liability arising directly from the per-
formance of his legal duties. Therefore he is not liable in
damages and I so hold. g
I now go to the first and second respondents. On the issue
of liability or otherwise of the first and second respondents,
the learned trial Judge held that they were not liable in dam-
ages to the appellants as they were performing their official h
and statutory duties. The word “official” means pertaining to
an office; depending on the proper office or authority. It
means something done by authority. The word “statutory”
means either enacted by statute or depending on statute for i
its authority.
From the above meanings, the questions arise:–
Was the freezing of the accounts of the appellants really
official in the sense that it was an authorised act by the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 193

a proper office of the first and second respondents? Was the

freezing of the accounts of the appellants either enacted by
statute or authorised by statute? If it was authorised by stat-
b ute, what statute?
I have dealt with the four so-called enabling statutes con-
tained in the application, which resulted in the null order
made by the sixth respondent. I should at this stage have a
c look at the sections relied upon by the learned trial Judge
and Counsel for the first, second and third respondents. The
learned trial Judge relied on sections 4 and 24(1) of the
Police Act (Authority to Reprint) Act, 1967 as legal basis for
d the freezing of the accounts of the appellants. In the first
place, it is fairly curious to me how sections 4 and 24(1) of
the Act came into the picture in this matter. The application
which gave rise to the order of the sixth respondent, did not
e contain sections 4 and 24(1) as two of the enabling provi-
sions. And so the first and second respondents could not
have acted under them. The “enabling” provisions were four
and they were clearly named as if it was the intention of the
f first and second respondents to act under the sections in the
Police Act, they should have specifically relied upon them.
But they did not. And so the two sections, even for that
reason alone, are completely out of the way.
g Assuming that I am wrong, let me in the alternative exam-
ine the merits of the provisions vis-à-vis the specific act of
freezing the accounts of the appellants. First section 4. This
section provides for the general duties of the Police. They
h are: (1) the prevention and detection of crime; (2) the appre-
hension of offenders; (3) the preservation of law and order;
(4) the protection of property; (5) the due enforcement of all
laws and regulations with which they are directly charged,
i including the performance of such military duties as may be
required of them.
Section 4, which is generically and omnibusly worded,
should be interpreted with utmost care and circumspection.
j The section cannot be interpreted beyond its already onerous
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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194 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

content. It is not my understanding that the section will act a

like a reservoir to accommodate with ease all police actions,
legal or illegal. It is not my understanding that section 4 will
act as a spare part to goad all police acts and inactions into b
legal functionality just by the press of the police button or
the alarm of the police whistle. That is not the use that the
draftsman has carved for section 4.
Because of its large and apparently volatile language, c
which is generally inimical to the rights of the citizen, sec-
tion 4 should be interpreted, whenever possible, liberally in
favour of the rights of the citizen. This is consistent with the
well established canons of statutory interpretation. d
I move to section 24(1). It is a less common subsection and
so I state herein verbatim ad literatim the subsection for ease
of reference and analysis:–
“A superior police officer may by authority under his hand author- e
ise any police officer to enter any house, shop, warehouse, or other
premises in search of stolen property, and search therein and seize
and secure any property believed to have been stolen, in the same
manner as he would be authorised to do if he had a search warrant,
and the property seized, if any, corresponded to the property de- f
scribed in such search warrant.”
Section 24, in its clear wording, does not need the assistance
of a court of law for its execution. It concerns only police
personnel and not the courts. By the section, authority of g
entry for the purposes of search and seizure of stolen prop-
erty moves from a superior police officer to any police offi-
cer. The court has no role or function to play under the
section 24(1) situation. So where lies the impact of the sub- h
section on the freezing of the accounts of the appellant?
None. And there cannot be.
If a statute encroaches on the private rights of the citizen or
individual, as the contents of sections 4 and 24(1) show, the i
courts must insist upon strict and rigid adherence to the
formalities laid down by the statute. And so in the context of
the instant case, section 24(1) cannot be successfully roped
into the issue before us without doing violence to its very j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 195

a clear provisions. After all, the subsection clearly provides

for a procedure to be followed and since such procedure was
not followed and cannot in law be followed, in the circum-
b stances of this case, the subsection will not be prepared to
accept the burden the learned trial Judge gave to it. The
subsection lacks legal, functional and factual capacity to
carry the burden.
c It has been settled by a long line of authorities that courts
should construe fortissime contra proferentes any provision
of the law, which gives or governs compulsory acquisition
of a person’s property. The statute should be construed
d strictly against the acquiring authority and sympathetically
in favour of the complaint by the owner or possessor of the
property against any irregularity in the procedure for acqui-
sition as laid down by the enabling statute (see Maxwell
e Interpretation of Statutes (12ed) pages 251–258. See also
Obikoya and Sons Ltd v. The Governor of Lagos State
(1987) 1 N.W.L.R. (Part 50) 385; Peenok Investments Ltd v.
Hotel Presidential Ltd (1983) 4 N.C.L.R. 122; Alhaji Bello
v. The Diocesan Synod of Lagos and others (1973) 1 All
f
N.L.R. (Part 1) 247).
In an attempt or in an effort to protect property of either
the Government or the citizenry under section 4, the police
should ensure that it does not in the process deprive the
g
citizen or individual of his right to property guaranteed in
the Constitution. That will amount to throwing away the
bath water with the baby in it. I seem to see such a situation
here. While trying to ensure that a successful criminal
h
prosecution in the Magistrate’s Court, Yaba, was not ren-
dered nugatory, as it affected the property rights of Alhaja
Tayibat Adeniyi, the police, in my view, took an irregular
action not supported by the so-called enabling provisions of
i the law, not only to antagonise but arrest the bank accounts
of the appellants, on the “judicial” authority of the sixth
respondent. Since by our adversary system and a fortiori by
section 33(5) of the 1979 Constitution, the first appellant
j is presumed innocent until the contrary is proved by the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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196 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

prosecution at the Magistrate’s Court, Yaba, the freezing of a

his accounts with fifth respondent is, to say the least, unfor-
tunate and sad. The long and short of it all is that neither
section 4 nor section 24(1) of the Police Act is authority for b
the freezing of the accounts of the appellants and I so hold.
Therefore, the first and second respondents are liable in
damages. I will return to the issue of damages anon.
In the light of my conclusion on the fourth issue, I do not c
see the necessity for me to take the sixth issue. That will be
a mere academic exercise. And courts of law, not being
teaching or research institutions are never interested in hy-
pothetical academic issues. In my view, issue no. 6 materi- d
ally dovetails into issue no. 4, particularly in the light of my
conclusions in respect of the latter. I therefore leave issue
no. 6 alone. And that does not make any difference to this
judgment. e
I now take the fifth issue. It is much more straightforward.
The law involved is most elementary. Let me state it
quickly. Where a court holds that it has no jurisdiction to
entertain a matter, it must strike out the matter and not dis- f
miss it. It has no such jurisdiction or competence to dismiss
the action (see Din v. Attorney General of the Federation
(1986) 1 N.W.L.R. (Part 17) 471; Makeri v. Kafinta (1990) 7
N.W.L.R. (Part 163) 611; Ezeomi v. Aghere (1991) 4 g
N.W.L.R. (Part 187) 631).
A court of law can dismiss a matter when it has been heard
on its merits and not when the matter had to abate on
h
grounds of lack of jurisdiction. Jurisdiction, as a matter of
law, and not a matter of fact, could be regularised by a plain-
tiff in certain instances. It is not like the facts of a case
which are constant like the sun rising from the east and
setting in the west everyday. And so if a suit is dismissed on i
grounds of lack of jurisdiction, the plaintiff will have no
opportunity to cure it, if it is legally possible so to do. Let
trial courts not dismiss suits on the ground that they do not
have jurisdiction to entertain them. Let them merely strike j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 197

a out such suits. It is possible the plaintiff may like to have a

second bite at the cherry if the law allows him to do so.
I promised returning to the issue of damages. I now return
b to it. The respondents are six. I have held that the sixth re-
spondent is not liable in damages. That leaves the list to five.
From the way issue no. 4 is worded and the generality of the
brief, I have the impression that the appellants are not press-
c ing the issue of damages in respect of the third, fourth and
fifth respondents. I say so because apart from the specific
mention of the first, second and sixth respondents in issue
no. 4, nowhere in the brief is the third, fourth and fifth re-
d spondents mentioned in respect of damages. Of course, I
have since referred to the seventh relief, which is so clear on
the issue. At the time I was struggling with the interpretation
of the contents of the brief I had not looked at the relief.
e That was quite my fault. Now the clear relief no. 7 seeks
thus:–
“N500,000 (Five Hundred Thousand Naira) as exemplary damages
against the Inspector-General of Police, Commissioner of Police,
Lagos State Command and Honourable Justice M.A. Olugbani
f jointly and severally for unlawful interference with the current
accounts of the Applicants.”
Before I undertake the exercise of awarding damages, let me
take time off to say one or two words in respect of the third,
g fourth and fifth respondents who have escaped the dragnet
of damages. I think Counsel who drafted the reliefs is vindi-
cated in law by excluding the three respondents. As a matter
of both law and fact, they are nominal defendants. They
h found themselves in the suit as a matter of satisfying the
statutory flavour and nothing more. They did not perform
any act or acts against the appellants. In law, nominal defen-
dants are not condemnable in damages. After all damages
i follow the cause. And so where there is no cause, there will
be no damages.
The appellants ask for N500,000 exemplary damages
against the first, second and sixth respondents. The three
j respondents say they are not liable for damages, not to talk
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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198 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

of exemplary damages. And so the gap of the dispute is a

enormous. Let me see whether the law can close up the gap.

Since 1964, the law on exemplary damages in England has b

changed drastically. That was in the case of Rookes v. Ber-
nard (1964) A.C. 1129; (1964) 1 All E.R. 367. Lord Devlin
was in it all. The House of Lords held that except in three
instances, exemplary damages would not be awarded against
c
a defendant however outrageous his conduct may be. The
three instances are (1) where there is an express authorisa-
tion by statute; (2) in the case of oppressive, arbitrary or
unconstitutional action by the servants of the government;
(3) where the defendant’s conduct had been calculated by d
him to make a profit for himself, which might well exceed
the compensation payable to the plaintiff.

Since 1964, Nigerian Courts have largely relied on the de- e

cision. The first case known to me is Ezeani v. Ejidike
(1964) 1 All N.L.R. 402, where Brett JSC called in aid
Rookes. Since then, the doctrine enunciated in the case has
formed the basis of determining whether exemplary dam- f
ages should be awarded or not (see A.R.E.C. Ltd v. Amaye
(1986) 3 N.W.L.R. (Part 31) 653; Eliochin (Nig.) Ltd v.
Mbadiwe (1986) 1 N.W.L.R. (Part 14) 47; Chief Williams v.
Daily Times of Nigeria Ltd (1990) 1 N.W.L.R. (Part 124) 1; g
Ilouno and others v. Chiekwe (1991) 2 N.W.L.R. (Part 173)
316).

Exemplary damages comes with the element of punitive-

h
ness. In short, it is in most cases designed, and in the context
of this case, to punish a defendant for an abhorrent behav-
iour or conduct. A wilful and intimidating conduct, which
prima facie is aberrant but oppressive, arbitrary and uncon-
stitutional conduct of a defendant. It is designed to teach the i
defendant some hard lesson for the unusual and unexpected
inhuman or outrageous conduct so that the particular con-
duct does not come the way of the defendant again. That is
the very essence of the second condition indicated above. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 199

a From the facts of the case, it is the appropriate condition.

Whether it is directly applicable and therefore irrevocable in
the circumstances of this case, is a different thing altogether.
b I shall return to this anon. The first condition on an enabling
statute is not appropriate here. So also is the third condition.
There is neither an enabling statute on the particular issue
before me, nor evidence that the first and second respon-
c dents’ conduct had been calculated by them to make a profit
for themselves which might well exceed the compensation
payable to the appellants.

The basic principle of law that he who asserts must prove

d the truth or correctness of his assertion, which permeates the
entire fabric of our adversary system, is also applicable to
the proof of exemplary damages. But the proof required is
substantially different from the general stream of proof of
e damages, including proof of special damages, proof of gen-
eral damages and proof of aggravated damages.

In order to succeed, a plaintiff must be able to prove any of

f the three conditions enunciated in Rookes, which were later
followed in Ezeani, and the group of cases. A plaintiff need
not prove all the three conditions to succeed. Once he proves
any of the three conditions, a court of law will award exem-
g plary damages.
The question is whether the appellants have satisfied the
burden of proof. Let me briefly take each of the conditions
in him. First, whether there is an enabling statute on the
h
issue. None was canvassed before this Court. None is known
by me. It is trite law that a party who relies on a particular
statute either as a sword or as a shield should specifically
plead it. Let me move to the third condition before I come to
i the second. It is more convenient to reverse the order. There
is no proof of the third condition. From the facts of this case,
there is no evidence that the first and second respondents
were influenced in their conduct by financial gains. No.
j None. That was never their interest.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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200 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The second condition, though appropriate in the circum- a

stances of this case, has not been proved by the appellants,
to exist on the balance of probability or on the preponder-
ance of evidence. While I entirely agree that the first and b
second respondents qualify as servants of government within
the context of Rookes (see Cassell and Co v. Broome (1972)
2 W.L.R. 645) the condition has not been proved by evi-
dence to exist. c
Let me sound more relevant and specific. An oppressive
conduct is an overburdensome conduct; a tyrannical and
overpowering conduct. An arbitrary conduct is a despotic,
capricious and absolute conduct arising mainly from acci- d
dent rather than from an established rule. An unconstitu-
tional act is an act committed outside the provisions of the
Constitution or, in more general language, an act that is
outside the law; or an illegal act. e
From the above diction one can facially come to the con-
clusion that the conduct of the first and second respondents
come within the second condition. But it is not so. Because
of the penal nature of the exemplary damages, courts of law f
should distinguish between bona fide conduct and mala fide
conduct on the part of a defendant and, in this context, the
first and second respondents. In the case of the former, a
court of law should not award exemplary damages. But in g
the case of the latter, a court of law should. In the instant
case, the first and second respondents did not take the law
into their hands, so to say. They sought an order of court.
That particular conduct is not consistent with a mala fide h
mind. Rather it is consistent with a bona fide mind.
In all the categories of damages, exemplary damages seem
to be the most expensive one. And I use the expression in a
relative sense in the context of a particular case with particu- i
lar facts in relation to all the other categories of damages.
Being so, a court of law must be very cautious and careful in
awarding exemplary damages. Before a court of law can
lawfully show the conduct of the defendant as an example j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 201

a by way of awarding exemplary damages, it must be clear

that there is no other alternative by way of awarding either
aggravated damages or general damages. While exemplary
b damages are punitive in nature, aggravated damages or gen-
eral damages are compensatory in nature.
A court of law cannot award exemplary damages merely
for the asking. A court of law cannot award exemplary dam-
c ages merely because the court as an adjudicator is annoyed
with the conduct of the defendant. Like the award of every
other category of damages, a court of law should not intro-
duce into the arena of award any personal sentiments. The
d court should, as usual, remove itself from the arena of con-
test and examine the real turn of events in the case dispas-
sionately before coming to the conclusion that the plaintiff
deserves nothing else than exemplary damages.
e Where a case for exemplary damages has not been made
by the plaintiff, the court can still award damages stripped of
its exemplary content. And this the court will be able to do
so taking into consideration the particular facts of the case in
f relation to the damages suffered by the plaintiff.
And in the light of the above, I would like to express my
little worry on the failure of the appellants (I do not want to
use the harder word, refusal) to give the specific lodgements
g in the bank accounts at the material time. That information
was enviously kept away from the court under lock and key.
While that information is not necessary in the award of
exemplary damages, it is really necessary in the calculation
h of general damages in the circumstances of this case.
There is evidence that the accounts were frozen in June,
1988. If this Court was let into the amount in the accounts at
the material time, it should have been in a better position to
i come out with a more scientific assessment of the damages
in this matter, using the multiplicand and multiplier doctrine.
But we are denied of that valuable information. While I am
in sympathy with the appellants not to make their lodge-
j ments a public affair, they cannot eat their cake and still
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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202 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

have it intact in their hands. That is both a logical and physi- a

cal impossibility.
I shall return to the issue of damages later. Let me take a
short recess to make one or two pertinent statements of a b
ministerial nature. The case deserves such statements.
As Judges of the superior courts of this country, courts are
duty bound to protect the Constitution in the performance of
our judicial duties. That is part of the Oath of Allegiance we c
took on assumption of office. As Judges of the superior
courts of this country, we should also and always have at the
back of our minds the judicial oath we took on that eventful
day that we were sworn as Judges. The judicial oath also d
enjoins all of us “to preserve, protect and defend the Consti-
tution of the Federal Republic of Nigeria”.
That is not all. Under the common law, we, as judicial of-
ficers, are under a legal duty to do justice to all manner of e
people coming before us without let or hindrance, without
fear or favour. By the nature of our duty, we are bound only
to look at the facts of the case before us and apply the law in
the way we understand it. Let us err only on the side of the f
law and the law alone.
In the performance of our judicial duties, no party is more
important than the other. They are of equal status as far as
the live issues before the court are concerned. We must do g
equal justice to the parties. Apart from the constitutional and
statutory protections to certain parties and litigants, we as
Judges should be upright in our adjudicatory functions
across the board, come rain, and come sunshine. Our only h
interest should be doing justice to the parties through law.
Nigeria is a democracy and by the grace of the Almighty
God it will remain a democracy for all times. The foundation
of any democracy is anchored on the rule of law both in its i
conservative and contemporary meaning. Putting it naively,
we are paid mainly and essentially to uphold the rule of law
in the entire polity. And so, once we fail to uphold the rule
of law, anarchy, despotism and totalitarianism will pervade j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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Dr. Gabriel Olusoga Onagoruwa v. Inspector-General of Police and others 203

a the entire society. The social equilibrium will be broken.

Law and order breaks down. Everybody will be his own
keeper and God for us all. We, as Judges, cannot afford to
b see society decay to such an irreparable level. We must rise
up fully to our duties by vindicating the tenets of the rule of
law in our practised democracy.
I should not be understood as saying that the sixth respon-
c dent is guilty of all the above. That is not the point I am
making. But I am rather surprised that he appended his sig-
nature to that application which has no basis in law. And by
that conduct, the sixth respondent, instead of protecting the
d citizen’s right to property, assisted the executive to violate
the rights. That looks to me to be a paradox, to say the least.
But this Court cannot find him liable to damages because of
the judicial immunity surrounding him as a Judge. I have so
held.
e
In the common law tradition, I refuse to think that the
founders of the doctrine of judicial immunity really had in
mind as their primary reason, the protection of the Judge qua
adjudicator. Rather they had in mind the creation of a forum
f where the Judge can enjoy maximum independence in the
performance of his judicial duties. I think all of us in the
judiciary should realise that original concept which is still
the law.
g
I now take the last run. It is on the amount of damages.
Learned Counsel for the appellants, Mr Olanrewaju
drummed into us the tottering value of the naira and urged
us to take that into consideration in the award of damages. I
h think he is right. For quite some time now, the monetary
system of the world in the global economic recession, has
radically and inevitably changed. The Naira is no longer a
stable and enduring currency. It floats in the money market
i adversely. It also floats in the Nigeria wind not because of
its physical lightness but because of its loss of monetary
value. After all, the Naira is now one heavy coin.
In these days of racing inflation where the buying or pur-
j chasing power of the Naira falls drastically (and painfully
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
204 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

so) everyday and therefore not commensurate to the quality a

and quantity of goods bought, a Judge should, in the assess-
ment of damages, consider the current market situation. It
will be most unrealistic to ignore this fundamental aspect b
and merely theorise with principles of law and facts and
figures presented to him in court by Counsel and witnesses.
While the Judge is not expected to play the role of a house-
wife at Sangross Market, Lagos or the Kasuwa Kurmi Mar-
ket of Kano or the Ogbete Market of Enugu by sampling c
prices of goods randomly, he must always remind himself
that market prices escalate by leaps and bounds and they
affect the purchasing power of the Naira.
d
After a very careful consideration of the matter before me
and in the light of the above analysis of the legal position, I
hereby award the sum of N30,000 as general damages
against the first and second respondents for the role they
played which resulted in the freezing of the accounts. I also e
order that the accounts, that is, accounts nos. 4425, 4570 and
4080 with the fifth respondent be defrozen with immediate
effect, and in any case not later than twenty-four hours after
the delivery of this judgment. I also order the fifth respon- f
dent to immediately, and not later than twenty-four hours
after the delivery of this judgment to resume full
banker/customer relationship with the appellants in their
usual custom and practice. g
I award N450 cost in favour of the appellants.
AWOGU JCA: I agree with the reasoning and conclusions
reached in the judgment just delivered. I too allow the ap-
peal with N450 costs in favour of the appellants. h
KALGO JCA: I have had a preview of the judgment just
delivered by my learned brother, Niki Tobi JCA, and I
agree with the reasoning and conclusions reached therein.
I therefore allow the appeal of the appellant and award i
him N450 costs against the respondents. I also abide by the
consequential orders made by my learned brother in the lead
judgment, including the order as to damages.
Appeal allowed. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)

Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 205

a
Owena Bank (Nig.) Limited v. Adejumo Edmond
Akintuyi
b COURT OF APPEAL, BENIN DIVISION
ADIO, AKPABIO, EJIWUNMI JJCA
Date of Judgment: 15 NOVEMBER 1991 Suit No.: CA/B/61/91

c Banking – Statement of account – Importance of same –

Evidential value thereof
Facts
d
The respondent as defendant in the High Court applied for
numerous overdrafts and loans from the appellant bank
through exhibit DA1–DA9 representing the applications and
approvals for the overdraft/loan including the conditions for
e the granting of the aforesaid facilities. The total original
overdraft/loan facilities was N252,000 which by sheer neg-
ligence of the defendant escalated with addition of interest
charges to the whopping sum of N506,975.48k. Due to the
f inability of the respondent to settle his indebtedness to the
plaintiff or any part of same, the plaintiff instituted this
action under the undefended list as provided under Order 23
of the Ondo State High Court (Civil Procedure) Rules, 1987
g to recover the overdraft/loans granted to the respondent. The
appellant subsequently got judgment against the defendant
under the undefended list, which judgment the respondent
subsequently brought an application to set aside. The lower
h court heard the application and consequently set aside the
judgment.
The appellant bank appealed against the lower court ruling
contending, inter alia, that under Order 23 of the High Court
i of Ondo State (Civil Procedure) Rules, 1987 relevant to the
application the trial Judge had no power to set aside any
judgment given under the undefended list and also that the
respondent had not disclosed any defence on merit to war-
j rant the setting aside of the aforementioned judgment.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)

206 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Held – a
Ledger cards or statements of account are only methods of
proof, and not a defence.
b
Appeal allowed.

Cases referred to in the judgment

Nigerian c
B.O.N. v. Intra Bank S.A. (1969) All N.L.R. 91
Ben Thomas Hotels Ltd v. Sebi Furniture Ltd (1989) 5
N.W.L.R. (Part 123) 523
d
Ojikutu v. Odeh (1954) 4 W.A.C.A. 640
Olasehinde v. A.C.B. Ltd (1990) 7 N.W.L.R. (Part 161) 180
U.A.C. (Tech.) Ltd v. Anglo Canadian Cement Ltd (1966)
N.M.L.R. 349 e

U.T.C. (Nig.) Ltd v. Pamotei (1989) 2 N.W.L.R. (Part 103)

244
f
Nigerian Rules of Court referred to in the judgment
High Court of Ondo State (Civil Procedure) Rules, 1987,
Order 23 Rules 1–5
g
Judgment

AKPABIO JCA: (Delivering the lead judgment) This is an

appeal against a Ruling of the Ondo State High Court sitting
h
at Akure in Suit No. AK/135/90 delivered on 15th January,
1991, in which Adebayo J set aside his judgment earlier
given in the suit on 8th November, 1990 in favour of the
plaintiff under the undefended list, and thereafter gave leave
to defendant to defend the suit and also ordered him to file i
his defence within 14 days from 15th January, 1990 with
N500 costs in favour of the plaintiff. The suit was then or-
dered to be removed from the “Undefended List” into the
“Ordinary Cause List” to be tried on its merits. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 207

a The plaintiff feeling aggrieved about the above decision

has appealed to this Court on two grounds which will soon
be set out in this judgment. But first, the facts of the case.
b In an action placed on the undefended list at the Ondo
State High Court, pursuant to Order 23 of the Ondo State
High Court (Civil Procedure) Rules, 1987 the plaintiff
claimed from the defendant as follows:–
c “The Plaintiff’s claim against the Defendant is for:–
(i) A sum of N506,975.48k (Five Hundred and Six Thousand,
Nine Hundred and Seventy Five Naira, Forty Eight Kobo)
being outstanding indebtedness (inclusive of interest) of the
d Defendant to the Plaintiff as at close of business on 31st
August, 1990 on the Loan/Overdrafts granted by the Plain-
tiff to the Defendant at the Defendant’s requests at Akure
between 1984 and 1987.
(ii) Interest of 27% per annum on the said sum of
e N506,975.48k from 31st August, 1990 until judgment is de-
livered in this case and thereafter interest to be calculated as
per the order or judgment of the Court until the whole or to-
tal indebtedness or judgment debt is finally and/or totally
f liquidated.”
The writ of summons was accompanied by an affidavit stat-
ing the circumstances under which the indebtedness arose
and to this was attached Nine documents marked as exhibit
g DA1–DA9.
Exhibit DA1 was a letter dated 18th October, 1984 written
by the defendant to the plaintiff applying for an overdraft of
two thousand Naira (N2,000). This was granted, and the
h approval for same conveyed to defendant in a letter (exhibit
DA2) dated 23rd October, 1984, which also set out the con-
ditionalities for the said loan/overdraft.
Then on 7th February, 1985, the defendant again in an-
i other letter exhibit DA3 applied for the sum of N175,000
(One Hundred and Seventy-five Thousand Naira) as a hous-
ing loan. In reply to this, the sum of N150,000 (One Hun-
dred and Fifty Thousand Naira only) was granted, and
j approval for same conveyed to defendant in a letter exhibit
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
208 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

DA4 dated 21st October, 1985. The conditionalities attached a

to this loan were also spelt out in the said letter.
Lastly, the defendant again on the 16th September, 1986,
in a letter exhibit DA5 applied for yet another loan tagged b
by him as “Supplementary Housing Loan of N250,000”.
Once more a lower amount of N100,000 was granted and the
approval for this was communicated to the defendant in their
letter exhibit DA7 dated 30th January, 1987. Conditionali- c
ties for this further enhancement loan was also set out.
Needless to say, defendant acknowledged receipt of all the
letters from the bank, and agreed to abide by the condition-
alities set out therein. d
Thereafter there was no indication that defendant refunded
the whole or any part of the above amount. Rather the indi-
cation was that by sheer neglect, defendant had allowed
what was originally only N252,000 to escalate by the addi- e
tion of interest charges to the walloping figure of
N506,975.48k.
The plaintiff justifiably became apprehensive, and so insti-
tuted this action under the Undefended List, as provided f
under Order 23 of the Ondo State High Court (Civil Proce-
dure) Rules, 1987.
As the provisions of this Order and Rules of Court have
featured prominently in the arguments of this appeal, and g
likely to do even more so in this Judgment, I consider it
expedient to set out the entire provision of the Order which
read as follows:–
“THE UNDEFENDED LIST h
1. Whenever application is made to a court for the issue of a
writ of summons in respect of a claim to recover a debt or
liquidated money or any other claim and such application is
supported by an affidavit setting forth the grounds upon i
which the claim is based and stating that in the deponent’s
belief there is no defence thereto, the court shall, if satisfied
that there are good grounds for believing that there is no
defence thereto, enter the suit for hearing in what shall
be called the ‘Undefended List’, and mark the writ of j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 209

a summons accordingly, and enter thereon a date for hearing

suitable to the circumstance of the particular case.
2. There shall be delivered by the plaintiff to the Registrar
upon the issue of the writ of summons as aforesaid, as many
b
copies of the above mentioned affidavit as there are parties
against whom relief is sought, and the Registrar shall annex
one such copy to each copy of the writ of summons for ser-
vice.
c 3. (1) If the party served with the writ of summons and affida-
vit delivers to the Registrar a notice in writing that he in-
tends 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 Court may
d think just.
(2) Where leave to defend is given under this rule, the action
shall be removed from the Undefended List and placed
on the Ordinary Cause List; and the Court may order
e pleadings, or proceed to hearing without further plead-
ings.
4. Where any defendant neglects to deliver the notice of de-
fence and affidavit prescribed by Rule 3(1) or is not given
leave to defend by the Court, the suit shall be heard as an
f undefended suit, and judgment given thereon, without call-
ing upon the plaintiff to summon witnesses before the court
to prove his case formally.
5. Nothing herein shall preclude the Court from hearing or
g requiring oral evidence, should it so think fit, at any of the
proceedings under Rule 4.”
It should be mentioned that after the institution of this action
it was difficult to effect personal service of the writ of sum-
h mons on the defendant. And so an application for substituted
service was made whereupon the defendant was served by
posting the writ of summons and other court processes on
his last known place of abode. The case was fixed for hear-
ing on 8th November, 1990. Under Order 23 Rule 3(1)
i
above, any defendant who felt he had a good defence, and so
wanted to defend the action should file a “notice of intention
to defend” before the suit was heard and judgment delivered.
(In other jurisdictions, e.g. Lagos, such notice should be
j given five clear days before the return date).
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
210 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

In the instant case the writ of summons was served on the a

defendant on 21st September, 1990, while the suit was heard
on 8th November, 1990. During the interval of 48 days
which ensued, the defendant filed no notice of intention to b
defend.
In the absence of any such notice, the learned trial Judge
duly gave judgment in favour of the plaintiff, as per his writ
of summons on 8th November, 1990. It should be mentioned c
that after the writ of summons was served on the defendant,
he instead of proceeding under the “Undefended List” provi-
sions to file his notice of intention to defend, proceeded
whether intentionally or otherwise, under the general provi- d
sions to enter appearance on 29th October, 1990.
He later averred in an affidavit that he was advised by his
Counsel that he had 30 days after entry of appearance to file
his statement of defence. There was no other affidavit by his e
Counsel to say that he gave such an advice in error and so
his sins should not be visited on his client. When he later
learnt that judgment had already been entered against him
under the “Undefended List”, the defendant brought an f
application to set the judgment aside and it was duly set
aside, as already mentioned above.
The plaintiff was dissatisfied with the said ruling, and so
appealed to this Court on two grounds as follows:– g
“GROUNDS OF APPEAL
(1) The learned trial Judge erred in law by setting aside his
judgment given in favour of the plaintiff under the ‘unde-
fended list’ on 8th November, 1990. h
WHEN
(i) Under and by virtue of ORDER 23 of the High Court
(Civil Procedure) Rules, 1987 of Ondo State he has no
power or jurisdiction to set aside any judgment given
i
under the ‘Undefended List’.
(ii) He has no jurisdiction, either statutory or otherwise to
set aside any judgment given on merit by him;
(iii) He could not (and cannot) sit as an appeal court over his
own decision. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 211

a (2) The learned trial Judge misdirected himself in law by set-

ting aside his judgment dated 8th November, 1990 and or-
dering a retrial of the case.
b WHEN
(i) No defence on merit has been shown by the defendant;
(ii) There is no material before the court to justify the or-
der.”
c Briefs of arguments were later filed and exchanged, and
issues for determination formulated. The appellant formu-
lated three issues for determination as follows:–
“ISSUES FOR DETERMINATION
d 1. WHETHER having regard to the provisions of Order 23 of
the Ondo State High Court (Civil Procedure) Rules, 1987,
the lower Court could set aside any judgment given under
‘the Undefended List’.
e OR
2. WHETHER the lower court has jurisdiction to set aside its
own judgment given on merit.
3. Assuming (without conceding) that the lower court could
f set aside its own judgment, whether the respondent’s affi-
davit as shown on page 31 shows any defence on merit to
warrant the exercise of that discretion in his favour.”
The respondent on the other hand formulated two issues
g which almost amounted to the same thing as follows:–
“ISSUES FOR DETERMINATIONS
(1) Whether the Ondo State High Court can set aside its own
judgment as in this case; and
h (2) Whether the High Court, Akure that tried this case was right
in setting aside the judgment in question.”
I have carefully considered all the surrounding facts of this
case as disclosed in the records, the provisions of Order 23
i of Ondo State High Court (Civil Procedure) Rules, 1987,
which appear to be different from those of some other
States, as well as the legal arguments of learned Counsel on
both sides made both in their written briefs, and orally in
j court, and come to the following conclusions.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
212 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

From the issues postulated above by learned Counsel on a

both sides, there appear to be only two main issues for de-
termination in this appeal as follows:–
(a) Whether, under Order 23 of Ondo State High Court b
(Civil Procedure) Rules, 1987, the court had any power
to set aside its judgment given under the Undefended
List procedure; and
(b) If so, whether the affidavit sworn to by the respondent c
herein on the 12th November, 1990 disclosed sufficient
defence on the merits as to warrant the setting aside of
the judgment given under the Undefended List.
Regarding issue no. (a), it was the contention of the appel- d
lant that the court had no power to set aside any of its judg-
ments given under the Undefended List, as such judgments
are judgments on the merits and not default judgments under
Order 37 Rule 9 of the General Rules. In support of this e
contention the following cases were cited:–
1. Bank of the North Ltd v. Intra Bank S.A. (1969) 1 All
N.L.R. 91 at 95, 97 and 98;
f
2. Ben Thomas Hotels Ltd v. Sebi Furniture Ltd (1989) 5
N.W.L.R. (Part 123) 523 and many others.
He submitted finally on this point that having passed his
judgment and signed the enrolled order the learned trial g
Judge became functus officio, and so only a Court of Appeal
could review the matter.
The learned Counsel for the respondent on the other hand,
while conceding that there was nothing under Order 23 h
authorising the setting aside of a judgment obtained under
the Undefended List, nevertheless submitted that there was
provision for setting aside any judgment delivered in a mat-
ter taken by default of appearance under Order 14 of the i
Ondo State Rules of the High Court.
He cited the case of U.T.C. (Nig.) Ltd v. Pamotei (1989) 2
N.W.L.R. (Part 103) 244 which was heavily relied upon by
the learned trial Judge in setting aside his judgment. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 213

a I have carefully read all the cases cited above, and others
not cited, and would say that, whether a judgment delivered
under the Undefended List could be set aside or not, depends
b on the provisions of the relevant Rules of Court. From the
entire Provisions of Order 23 set out above, there is no such
provision in the Ondo State High Court (Civil Procedure)
Rules, although such a provision could be found in Kwara
c State or Lagos State Rules.
In the case of U.A.C. (Tech.) Ltd v. Anglo Canadian Ce-
ment Ltd (1966) N.M.L.R. 349, Ikpeazu J clearly made a
distinction between a “default judgment” obtained under
d Order XL of the High Court Rules of Lagos State, and a
judgment obtained under Undefended List governed by
Order III Rules 9–14 of the Lagos State (Civil Procedure)
Rules and concluded that “such judgment is a judgment on
e the merits and is not default judgment at all”. But in the case
of A.Y. Ojikutu v. Francis E. Odeh Trading as Odeh Trading
Co (1954) 14 W.A.C.A. 640, the matter was treated slightly
differently.
f In that case which was also brought under the Undefended
List, the relevant rule required the defendant to put in his
notice of intention to defend and affidavit of grounds of
defence, against a claim on the Undefended List, five days
g before the hearing. The defendant’s solicitor put them in two
days before.
At the hearing plaintiff’s solicitor asked for judgment. De-
fendant’s solicitor said it was his fault in not reading the
h rule, and asked for time to put in an affidavit to that effect,
but the trial Judge refused, and gave judgment and the de-
fendant appealed.
The Judge ought to have given the defendant permission to
i file an affidavit on terms. In that case, Thesiger LJ made the
following observations:–
“Blunders must take place from time to time, and it is unjust to
hold that because a blunder during interlocutory proceedings has
j been committed, the party blundering is to incur the penalty of not
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
214 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

having the dispute between him and his adversary determined a

upon the merits.”
One was almost carried away by the above dictum to say
that the appeal in this case should be allowed, and the case b
remitted to the court below for re-trial on the merits. But
first one had to see whether there was any genuine reasons
for failure to file a notice of intention to defend at the appro-
priate time, and also whether the affidavit filed by the re- c
spondent disclosed any “prima facie defence to the claim”.
And that will bring us to consideration of the second ques-
tion for determination. However, before doing that the first
question for determination must be answered. From the d
provisions of Order 23 Rules 1–5 already set out above,
nowhere is it provided that after giving judgment under the
Undefended List, the same Judge could set aside his judg-
ment, unlike the provisions in some other States, such as that e
in Kwara State.
I hold therefore that, in view of the absence of any provi-
sion under Order 23 of Ondo State High Court (Civil Proce-
dure) Rules, 1987, governing Undefended List procedure, f
the learned trial Judge had no power to set aside his own
judgment. Only an Appeal Court could do so.
Regarding the second question as to whether the affidavit
sworn to by the respondent on 12th November, 1990 dis- g
closed sufficient defence on the merits as to warrant the
setting aside of the judgment given under the Undefended
List one has to look at the said affidavit to give an answer.
h
The appellant in his brief submitted that it disclosed no
defence whatsoever, whereas the respondent was of the view
that it did, and the learned trial Judge also appeared to hold
this view. The operative paragraphs of the said affidavit are
paragraphs 7 and 8 which read follows:– i
“7. That I wish to defend the action because apart from the
bank not sending me any statement of account, the state-
ment of account marked exhibit DA9 attached to the sum-
mons is all a 1990 statement of interests on the said loan. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 215

a 8. That I do not believe that my true account with the bank

could be up to N506,975.48 claimed against me.”
From the above averments, I regret to say that I cannot see
b that any of the paragraphs has raised what might be called a
prima facie defence to the action, as to warrant a fresh trial
being ordered. In the first place, the respondent did not deny
obtaining any loan from the appellant bank. Rather the re-
c spondent’s Counsel at page 1 of his brief openly stated that
the respondent admitted owing appellant the principal sum
claimed.
Secondly, there was no averment that respondent had ever
d paid any amount which could have had the effect of reduc-
ing his indebtedness. Thirdly, there is nothing in the affida-
vit to show that respondent was quarrelling with interest
charges, such as that he was being charged interest at a rate
e higher than what was agreed upon. All he said was that he
did not believe that his true account with the bank could be
up to the figure claimed against him, without stating what
were the grounds for such disbelief.
f In the case of Olasehinde v. African Continental Bank Ltd
(1990) 7 N.W.L.R. (Part 161) 180 (C.A.), the A.C.B. had
claimed the sum of N117,680.28 against the defen-
dant/appellant as overdraft and interest charges. The appel-
g lant in his defence not only denied ever receiving any loan
or overdraft from the respondent, but also counter-claimed
for a total of N67,125 which he said were amounts deliber-
ately omitted from being credited into his account, as well as
h self debited cheque paid into his account by the erstwhile
manager of the respondent’s Ife branch at the material time.
He had his copies of bank statements with which he was
prepared to prove his case, but the trial Court had disallowed
i them on the ground that they were not pleaded.
In other words the counter-claim of the appellant had not
been properly considered. The Court of Appeal, Ibadan
(Sulu-Gambari, Ogwuegbu and Akpabio JJCA) held that the
j appellant’s counter-claim was not properly considered and
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
216 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

that his copies of bank statements were wrongly rejected. a

The case was therefore remitted to the lower court for re-
trial by another Judge. In the instant case, one wonders what
the lower court would be looking for, if the case was sent b
back for re-trial. For instance, the respondent averred at
paragraph 7 of his affidavit that: “the 8 line statement of
account marked exhibit DA9 attached to the summons is all
1990 statement of interests on the said loan”. That is true, c
but what was the court to do about that? There was no alle-
gation that any of those figures was wrong. As I said earlier,
there was no allegation that the interest was calculated on
wrong principles or figures. One must concede that if there
d
had been a full-scale trial, the appellant bank would have
been obliged to tender all the ledger cards from the date of
inception of the loan up to the date of trial, to see how the
final figure was arrived at, which was not done. In this re-
gard it was open to the respondent to have called for his full e
statement, which could have been given to him. Rather he
maintained an attitude of studied indifference, and deliber-
ately refused to go near them. It was even a tug of war be-
fore they could get him to serve by substituted service. f

In any case, it must be pointed out that ledger cards or

statements of accounts are only methods of proof, and not a
defence. In the case for Olasehinde v. A.C.B. (supra), the g
Bank tendered all the requisite ledger cards to prove their
case, but the court still ordered a re-trial because the appel-
lant contended that there were certain payments he made
which were not reflected on the ledger cards. In the instant h
case the respondent is not contending that there was any
omission or unauthorised entries in his account.

The fact that respondent could now complain about “the 8

line statements of accounts marked exhibit DA9 attached to i
the summons” means that he got all the papers used to sup-
port the application for the “Undefended list”, before the
date of hearing. If he had any bones to pick with the appli-
cant about the balance of his account, he should have gone j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Akpabio JCA
Owena Bank (Nig.) Ltd v. Adejumo Edmond Akintuyi 217

a to make them at or before the trial court, and not wait till
after judgment before coming here.
On the totality of the foregoing, I hold that the second
b question for determination must also be answered in the
negative, namely that the affidavit of the respondent did not
disclose any defence as to warrant this case being sent back
for re-trial on the merits at the court below. The whole of
c respondent’s conduct appears to me to be nothing but a
calculated attempt to stall for time, while at the same time
aggravating his own indebtedness.
This appeal therefore succeeds and is hereby allowed. The
d ruling of the learned trial Judge dated 15th January, 1991 is
hereby set aside, and his judgment dated 8th November,
1990 in which judgment was given for the plaintiff as per its
writ of summons is hereby restored.
e Cost of this appeal is assessed at N500 in favour of the ap-
pellant.
ADIO JCA: I have had the advantage of reading, in draft,
the judgment just delivered by my learned brother, Akpabio
f JCA, and I agree that the appeal should be allowed. I too
allow the appeal and I abide by the consequential orders,
including the order for costs.
EJIWUNMI JCA: As I was privileged to have read in ad-
g
vance the judgment just delivered by my learned brother,
Akpabio JCA, for the reasons advanced in the judgment,
which I adopt as my own, the appeal is allowed by me with
N500 as costs to the appellant.
h
Appeal allowed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

218 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Bala Angyu v. Alhaji Shehu Malami
Majidadi Alkanci
COURT OF APPEAL, KADUNA DIVISION b
MOHAMMED, MUSDAPHER, OKUNOLA JJCA
Date of Judgment: 12 DECEMBER 1991 Suit No.: CA/K/102/91

Banking – Banker and customer relationship – Nature of

c
relationship
Banking – Cause of action on unpaid overdraft – When it
accrues
Banking – Deposit account – payment of interest thereon – d
Whether implied
Banking – Merger of separate and distinct accounts –
Merger of same without customer’s authority – Propriety of
e
Banking – Overdraft facility – Prerequisites of demand for
repayment
Banking – Unauthorised closure of deposit account – Nature
of damages arising therefrom – General or special f

Facts
The first respondent, who was the managing director of the
second respondent, operated three separate and distinct g
accounts namely (i) personal savings account; (ii) personal
current account; and (iii) short-term deposit account, with
the second appellant at its branch along Ahmadu Bello Way
Sokoto, wherein the first appellant was the manager of the h
said branch between 1984 and 1989. The second respondent
which is the first respondent company also maintained a
current account with the second appellant at the same
branch. i
The first respondent being an illiterate person who could
neither read nor write consequently operated all his three
accounts through the officers of the second appellant, par-
ticularly the first appellant who used to write out cheques for j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 219

a the first respondent whenever there was need for same, and
as a result of the banking dealings between them, the first
respondent reposed overwhelming confidence in the offi-
b cials of the bank and did not bother to question what they
did on his behalf. The officials of the second appellant espe-
cially the first appellant subsequently capitalised on the
illiteracy of the first respondent to manipulate the accounts
c operated through him. Some time in 1988 the first appellant
wrongfully withdrew the sum of N8,000 from the first re-
spondent’s account without the latter’s knowledge. The first
respondent on becoming aware of this unauthorised with-
d drawal from his account confronted the first appellant who
apologised and promptly refunded the said sum to the re-
spondent who acknowledged the receipt of same. Sequel to
this unauthorised withdrawal the first respondent became
e uncomfortable in further dealing with the second appellant
and its officers. He thereafter commissioned Messrs Olusola
Adekanola and Co, a firm of chartered accountants to carry
out an independent investigation on all the four accounts
f maintained with the second appellant. The result of the in-
vestigation revealed a lot of irregular transactions and with-
drawals of large sums of money without the first
respondent’s knowledge. Based on the accountant’s report,
g the first respondent demanded from the appellants the sum
of N1,844,643.37k. Following the refusal of the appellants
to pay the money demanded for, the respondents took out a
writ of summons and claimed against the appellants jointly
h and severally, the sum of N2,844,643.37 as special and
general damages for fraudulent debits, unauthorised trans-
fers, contentious debits, undue interest charges and damages
suffered by the respondents. The second appellant in the
same suit counter-claimed for the sum of N686,499.05k
i
against the first appellant for unpaid overdraft.
The learned trial Judge, Omokri J, entered judgment in fa-
vour of the respondents for the sum N683,809.84k and
j struck out the counter-claim of the second appellants.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

220 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The appellants were dissatisfied with the learned trial a

Judge decision and consequently appealed to the Court of
Appeal.
Held – b
1. An agreement regulating the relationship of banker and
customer is implied from course of dealing between
them, in the absence of express agreement to the con-
trary. c
2. Where in consonance with agreement, express or im-
plied between a banker and customer whereby a cus-
tomer’s several accounts, as in this case, deposit and
personal accounts, are to be kept distinct and separate, d
the banker has no right to combine the accounts or trans-
fer assets or liabilities from one account to another with-
out reasonable notice of the intention to do so or without
the assent of the customer. e
3. Where an overdraft is granted by a bank to a customer, it
is implied in the relationship subsisting between a
banker and customer that cause of action for repayment
will not accrue until there has been a formal demand or f
notice given and demand becomes a necessary prerequi-
site to an action for recovery where the overdraft con-
tracts provide that, in default of any instalments, the
principal sum will become payable on demand. g
4. Demand that will satisfy formal demand for the repay-
ment of overdraft must be specifically made in which the
bank requests for settlement of the overdraft within a pe-
riod of time, and if the customer fails to meet the dead- h
line, the bank can go to court and take out a writ. Letters
drawing customer’s attention to position of his account
do not qualify as a demand for repayment, neither does
issuance of writ of summons amounts to demand unless i
same is issued and served on the customer on the due
date for the repayment of the overdraft.
5. Generally, the unauthorised closure of a deposit account
by a bank without a customer’s consent or authority will j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 221

a make the bank liable for general damages. In this case

the action of the second appellant in closing the short
deposit account of the first respondent attracted a claim
b for general and not special damages. If, however, there is
a pre-determined agreeable rate of interest between the
banker and the customer, the customer will equally be
entitled to claim the agreed interest as special damages
c in addition to general damages.
6. Where a debt or liquidated demand is due and payable at
the date of issue of the writ, no previous demand for
payment is necessary, since the service of the writ itself
d constitutes such a demand. Conversely, if the debt is due
but not payable at the date of the issue of the writ, or if
the debt is not present but is to accrue, a previous de-
mand for its payment is necessary.
e 7. The existence of a deposit account per se involves pay-
ment of interest. The advantage that a customer gains by
opening a deposit account is that the banker pays interest
on the sum paid into such account.
f Appeal dismissed.

Cases referred to in the judgment

Nigerian
g
Abeigbe v. Ugbodume (1973) 1 S.C. 133
Adekunle v. State (1989) 5 N.W.L.R. 9 (Part 123) 505
Ajibade v. Mayowa (1978) 9–10 S.C. 1
h
Awosile v. Sotunbo (1986) 3 N.W.L.R. (Part 29) 471
British and French Bank v. Opaleye (1962) 1 S.C.N.L.R. 60
Duriminiya v. C.O.P. (1961) N.R.N.L.R. 71
i Johnson v. Sobaki (1968) 2 All N.L.R. 282
Mercantile Bank Ltd v. Onigbanjo (1969) N.C.L.R. 1
Odusote v. Odusote (1971) 1 All N.L.R. 219
j Official Receiver and Liquidator v. Moore (1959) L.L.R. 46
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)

222 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Omonuwa v. Wahabi (1974) 4 S.C. 37 a

U.D.C. v. Ladipo (1971) 1 All N.L.R. 102

Foreign b
Joachimson v. Swiss Bank Ltd (1921) All E.R. 92

Nigerian statute referred to in the judgment

c
Evidence Act (Cap 112), Laws of the Federation of Nigeria,
1990, section 148(d)

Foreign Rules of Court referred to in the judgment

d
English Supreme Court Rules (White Book) 1988 Edition,
Order 6 Rule 2(4)

Books referred to in the judgment

e
Chitty on Contracts, Specific Contracts (12ed) paragraph
2586, page 246
McGregor on Damages (14ed) paragraph 17, page 16
Orojo Nigerian Commercial Law and Practice, Volume 1, f
page 364

Counsel
g
For the appellants: Aluko-Olokun (with him Bamiyi)
For the respondents: Ojo (with him Adeyi)

Judgment h
MOHAMMED JCA: (Delivering the lead judgment) This is
an appeal from the judgment of Omokri J of Sokoto State
High Court, in a suit in which the respondents as plaintiffs
sued the appellants and claimed against them jointly and i
severally for the sum of N2,844,643.37 as special and gen-
eral damages. The claim was based on fraudulent debits,
unauthorised transfers, contentious debits, undue interest
charges and damages suffered by the respondents. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 223

a The respondents are customers of the second appellant, at

its branch along Ahmadu Bello Way, Sokoto, and the first
appellant was the manager of the said branch between 1984
b and 1989. The first respondent, who is the managing director
of the second respondent, operates three accounts with the
second appellant, in the following manner:–
“1. Alkanci Alhaji Shehu Malami Majidadi (Personal Current
c Account).
2. Shehu Malami Alkanci (Personal savings Account No.
03D:947).
3. Alhaji Shehu Malami Alkanci (Short Term Deposit Ac-
count).”
d
The second respondent maintained a current account only.
The first respondent was an illiterate person and could nei-
ther read nor write in English language. He therefore oper-
e ated the four accounts through the officers of the second
appellant, particularly the first appellant, who also wrote
cheques for him. It has been alleged in the pleadings of the
respondents that the first respondent reposed so much confi-
dence in the officials of the bank, including the first appel-
f lant, and did not question whatever they did on his behalf
until sometime in 1988 when the first respondent became
aware that the sum of N8,000 had been cashed from his
current account without his knowledge.
g
On confronting the first appellant with this discovery he
was said to have apologised and promptly refunded the said
sum of N8,000 to the first respondent. The first respondent
issued him with a receipt which had been admitted as exhibit
h
141 in this suit. After this incident the first respondent be-
came apprehensive about the condition of his accounts and
therefore commissioned a firm of chartered accountants to
investigate all four the accounts mentioned above. The result
i of the investigations revealed a lot of irregular transactions
and withdrawals of large sums of money from those ac-
counts without the knowledge of the first respondent. Based
on the accountant’s report, the first respondent demanded
j from the appellants the sum of N1,844,643.37k. When there
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
224 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

was no response from the appellants he went to court and a

took out a writ claiming the sum of N2,844,643.37k, being
special and general damages, for what I described above.
The second appellant counter-claimed for the sum of b
N686,449.05k against the first appellant for the overdraft
which was yet to be paid.
At the end of the trial, Omokri J entered judgment in fa-
vour of the respondents, but for the sum of N683,809.84k c
and struck out the counter-claim. It is against the said judg-
ment that the appellants have appealed to this Court. At the
initial stage eight grounds of appeal were filed and later,
following an application through a motion on notice 5, more d
grounds were added, making the total to be 13 grounds of
appeal. The grounds, plus their respective particulars, cover
about nine foolscap papers and I do not intend to reproduce
them in this judgment. e
The issues formulated by the appellants’ Counsel are also
very wide and could be taken as 16 short statements of facts
which the learned Counsel headed as “Issues for Determina-
tion”. It is important to note that issues for the determination f
of appeal are short questions raised against one or more
grounds of appeal and are meant to be a guide to the argu-
ments and submissions to be advanced in support of the
grounds of appeal. I have gone through those issues and g
since they are more in numbers than the grounds of appeal I
found a number of them repetitive of the arguments raised in
the grounds of appeal.
h
I have also gone through the issues formulated by the
learned Counsel for the respondents for the determination of
this appeal and I do not hesitate to point out that those issues
are better framed and they cover most of the grounds filed
by the appellants against the decision of the lower court. i
However, in order to project the issues raised by the appel-
lants’ Counsel, in the appellants’ brief, I have endeavoured
to paraphrase them in shorter questions and which could
easily be understood in the following manner:– j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 225

a “1. Whether the learned trial Judge was right to hold that the
filing of a counter-claim does not amount to a demand for
debt owed by the 1st respondent.
b 2. Whether the contents of the investigation report are admis-
sible in law when the expert who made it is a witness in the
case.
3. Whether the Court acted properly in making the award of
general damages.
c
4. Whether the trial Judge acted properly in awarding the
values of cheque Nos. 866830/001301 and 366830/001303
to the 1st respondent in the circumstances of this case.
5. Whether the trial Judge was right to give judgment in fa-
d vour of the respondent having regards to pleadings and evi-
dence.
6. Whether the award of N8,000 and N3,500 made against the
cheques marked exhibits 1 and 3 respectively was proper.
e 7. As in issue 6
8. Whether in view of the pleadings the trial court is right to
hold that exhibits 10 and 12 were mysterious cheques not
emanating from the respondents.
f 9. As in issue 8.
10. Whether the trial Judge was correct in holding that the
appellants were liable for the total sum of N95,000 repre-
sented on cheques marked as exhibits 9 and 11 by compar-
g ing the handwriting of 1st appellant and the handwriting on
those exhibits.
11. Whether the standard of proof required in a criminal allega-
tion had been discharged by the respondents.
h 12. Whether reasonable inference was drawn by the trial Judge
in comparing the handwriting of 1st appellant with the
handwriting in exhibits 9, 11, 72, 74, 79, 87, 88, 94, 95, 97
and 98.
13. Whether the learned trial Judge was right to award N30,000
i to the respondent as loss of interest on his closed short de-
posit account.
14. As in issue 13.
15. Whether the learned trial Judge rightly invoked section
j 148(d) of the Evidence Act against the appellants.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
226 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

16. Whether it was right of the trial Judge to hold that the a
interests charged on the respondents’ accounts were undue
and unjustifiable.”
A number of issues formulated by the learned Counsel for b
the respondents, in the respondents’ brief, have been consid-
ered in the formulation which I have recast above, in the
appellants’ brief. It is however, my view, that the following
four issues in the respondents’ brief are pertinent for the c
determination of the appeal and I reproduce them below:–
“1. Whether the appellants are liable for honouring cheques that
are irregular.
2. Whether the appellants could close the 1st respondent’s d
short-time deposit account without notice to him.
3. Whether the 1st appellant and his predecessors in office
manipulated the respondents’ accounts, and if so whether
the 2nd appellant is vicariously liable.
e
4. Whether the respondents’ case is premised on fraud or
forgery.”
On the first issue the learned Counsel for the appellants, Mr
Aluko-Olokun, argued that the learned trial Judge was f
wrong to strike out the first appellant’s counter-claim on the
ground that there was no prior demand from the first appel-
lant before the counter-claim was filed. He argued that the
counter-claim was a sufficient demand since it is equivalent g
to a writ issued by the first respondent. He referred to the
case of Joachimson v. Swiss Bank Ltd (1921) All E.R. 92 at
94 and 95. The learned Counsel for the respondents, Mr
Bayo Ojo, replied that the learned trial Judge was quite right
h
to strike out the counter-claim because there was no demand
made on the respondents to liquidate the so-called overdraft.
He referred to Johnson v. Sobaki (1968) 2 All N.L.R. 282 at
282. The learned Counsel, quite rightly, in my view, dis-
tinguished the decision in Joachimson’s case (supra) with i
the facts of the case in hand and submitted that in that case
it was a customer who was claiming from the bank, unlike
the case in hand, in which the bank is claiming from the
customer. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 227

a I have looked into the facts of Joachimson’s case and I

agree with the learned Counsel for the respondents that it is
not on all fours with the case in hand. In view of the absence
b of a Supreme Court’s or this Court’s authority, the High
Court’s case of Johnson v. Sobaki (supra) is very helpful. A
reference had been made to the case of Official Receiver and
Liquidator v. Moore (1959) L.L.R. 46 at 50–51 in which it
c was held that where an overdraft is granted by a bank the
cause of action should not be deemed to have arisen until
there has been a demand made or notice given.
In Nigerian Commercial Law and Practice by Olakunle
d Orojo, Volume 1 at page 364, the learned author held that
where an overdraft is granted by the bank, the cause of ac-
tion does not arise until there has been a demand made or
notice given. It is an implied term in the relationship be-
e tween a banker and his customer that there should be no
right of action for the repayment of an overdraft until there
has been a demand made or notice given. It has, however,
been held that the issue of a writ amounts to a demand (see
Mercantile Bank Ltd v. Onigbanjo (1969) N.C.L.R. 1). It is
f
common sense to insist that a demand has to be made before
the cause of action arises. The customer had been granted
the overdraft after normal application before the bank and
under ordinary banking practice the overdraft attracts inter-
g est. So until a demand for payment of the overdraft is made
and the customer fails to pay there is no cause for parties to
go to court. See also the English Supreme Court Practice
(White Book) 1988 Edition, under Order 6 Rule 2(4) where
h it is held as follows:–
“Where a debt or liquidated demand is due and payable at the date
of the issue of the writ, no previous demand for payment is neces-
sary, since the service of the writ itself constitutes such a demand
i (see Joachimson v. Swiss Bank Corporation (1921) 3 K.B. 110
C.A. and see para. 49/1/16, n. “Judgment debtor’s bank balance”).
On the other hand, if the debt is due but not payable at the date of
the issue of the writ, or if the debt is not present but is to accrue, a
previous demand for its payment is necessary (see Bradford Old
j Bank Ltd v. Sutcliffe (1918) 2 K.B. 833, per Scrutton, L.J. page
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
228 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

848). Again, if a debt is payable by instalments but the contract a

provides that in default the principal sum should become payable
‘on demand’, a demand is a necessary prerequisite to an action for
the recovery of the principal debt, since it is an essential ingredient
in such a cause of action (Esso Petroleum Co. Ltd v. Alstonbridge b
Properties Ltd and Others (1975) 1 W.L.R. 1474; (1975) 3 All
E.R. 358).”
It has been argued that some letters written to the first re-
spondent, drawing attention to the position of his account, c
amounted to a demand. The learned trial Judge reproduced
those letters in his judgment and, quite rightly in my view,
rejected them as not amounting to a demand. The demand
must be specifically made in which the bank requests for d
settlement of the overdraft within a period of time and, if the
customer fails to meet the deadline, the bank can go to court
and take out a writ. A counter-claim is like any claim and
can never arise until a justiciable action arises. There is no e
justiciable action in a situation where a customer who ob-
tains an overdraft from a bank in the ordinary practice of
banker and customer and who has not been demanded to
settle, is sued in court over the overdraft. f
I have considered the judgment of the learned trial Judge
and observed that he had only struck out the counter-claim;
thus permitting the second appellant to come back again
after submitting the necessary demand for payment. I also g
observe that the two actions, i.e. the respondents’ claim and
the counter-claim, should not be tried together, under the
ordinary practice because the respondents’ claim against the
appellants is based on a criminal charge against the officials h
of the bank. The counter-claim, on the other hand, is based
on a normal transaction between a bank and its customers
with no illegality or crime involved.
It is always clear that in deciding whether to dismiss or i
strike out an action, the court exercises a discretion (Abeigbe
v. Ugbodume (1973) 1 S.C. 133). If the court exercises its
discretion and strikes out an action it is the duty of the ap-
peal court to look into the decision and be satisfied that the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 229

a discretion had been exercised judicially. In matters of discre-

tion, no one case can be an authority for another, and the
court cannot be bound by a previous decision to exercise its
b discretion in particular way (see Odusote v. Odusote (1971)
1 All N.L.R. 219). I have looked into the reasons given by
the learned trial Judge which guided him to strike out the
second appellant’s counter-claim and I am satisfied that he
c acted judicially. That ground of appeal fails.
I now move on to ground no. 2 which had been formulated
against ground 10. The argument of the learned Counsel for
the appellants is that the learned Judge had erred in utilising
d the findings recorded in exhibit 128, the investigation report
of the auditors. Counsel submitted that the investigation
report do not constitute evidence upon which the court can
act, and referred to a Supreme Court decision where it was
e held that it was unnecessary to tender a medical report when
the doctor who wrote it was a witness in the case (Adekunle
v. The State (1989) 12 S.C.N.J. 182 at 192; (1989) 5
N.W.L.R. (Part 123) 505). It is quite correct that it is unnec-
essary to tender the medical report once the doctor is a wit-
f
ness. But where the report is from an expert who has
prepared voluminous papers, it is desirable to have the re-
port made into an exhibit for easy reference by the Court.
This is always the case in cases involving accounts or engi-
g neering reports. It has always been the practice to admit and
act on the report submitted by accountants, engineers and
surveyor, even if they appear to testify as witnesses in court.
What is important is that the expert must explain in court
h what he has prepared and how he arrived at his decision
during the course of his duty.
The court must take note not to embark on investigations
and comparisons of documents or exhibits without being
i called upon to do so. There should be evidence pointing to
the discrepancies in the entries, in a report which would lead
the trial court to make the necessary analysis and compari-
sons. The learned trial Judge was aware of the consequences
j of such an exercise if there is no evidence to support it.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
230 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Hence his warning to himself after reference to the case of a

Duriminiya v. Commissioner of Police (1961) N.N.L.R. 70
at 73–76. The auditor who undertook the investigation of the
accounts of the respondents had given evidence and had b
been subjected to rigorous cross-examination, over the evi-
dence, and the contents of his report during the trial. I there-
fore do not agree with the learned Counsel for the appellants
that the learned trial Judge had erred in considering the c
report in his judgment.
Next, Mr Aluko-Olokun argued that the award of N30,000
as general damages for loss of interest due to the closure of
the short-term deposit account was erroneous because the d
award was made arbitrarily. The claim partakes of the nature
of special damages which needs to be specifically pleaded
and proved. Counsel argued that there was no claim for loss
of interest and no plea that any interest was derivable or e
claimable for the short-term deposit. He further submitted
that there was neither pleading nor evidence to support the
decision to award interest. Counsel then finally said that the
existence of a deposit account per se does not involve pay- f
ment of interest. Everything depends on the terms of the
agreement between the banker and the customer.
Mr Ojo for the respondents referred to the judgment of the
learned trial Judge and reproduced it in extenso, in order to g
show that the first appellant acted without authority or no-
tice, in closing the short deposit account of the first respon-
dent. In doing so, Counsel submitted that the appellants had
denied him of the interest that would have accrued on the h
short deposit account and that naturally occasioned dam-
ages.
It is quite clear from the evidence before the court that the
finding of the learned trial Judge that the closure of the short i
term deposit account of the first respondent with deposit of
N50,000 and its eventual transfer to his personal account
was without his authority. This decision, in my view, is un-
assailable. See also the evidence of PW4, a senior manager j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 231

a in the Central Bank, who told the court that a transfer of

money from a deposit account to a current account must be
preceded by a written instruction from the customer asking
b for such a transfer. Following the decision of the Supreme
Court in the case of British and French Bank v. Opaleye
(1962) 1 All N.L.R. 26 it is plain that:–
“Where by agreement express or implied, a customer’s several
c accounts with a banker are to be kept distinct and separate, the
banker has no right to combine them or to transfer assets or li-
abilities from one account to another, without reasonable notice of
the intention so to do, or without the assent of the customer.”

d The second point is that the learned trial Judge was wrong to
award interest when it was not specifically claimed. Here
again I will refer to British and French Bank v. Opaleye
(supra) where it was held that in the absence of an express
agreement, an agreement regulating the relationship of
e
banker and customer is implied from the course of business
between them. I believe that it has gained notoriety which
requires no proof that the advantage that a customer gains by
opening a deposit account is that the banker pays interest on
f sums paid into such account (see Chitty on Contracts Spe-
cific Contract (12ed) paragraph 2586 at page 246).
I do not agree that the existence of a deposit account does
g not per se involve payment of interest. It is plain without
saying so that it does. 1 am also of firm view that the action
of the second appellant in closing the short-term deposit
account of the first respondent attracts a claim for general
and not special damages. This is because there is no evi-
h
dence of any agreement between the banker and the cus-
tomer over which rate of interest the bank would pay against
the deposit account. It is only where such is available and
the bank fails to pay that the damages become special since
i damages are within the contemplation of the parties. What
the first respondent suffered was pecuniary loss, and since
such loss could not be estimated accurately, it is general
damages (see McGregor on Damages (14ed) paragraph 17 at
j page 16).
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
232 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

General damages is such a loss which flows naturally from a

the defendant’s act. It need not be specifically pleaded. It
arises by inference of law and need not be proved by evi-
dence. It suffices if it is generally averred. The measure of b
general damages in terms of money is a matter for the jury
under the direction of a Judge or by the Judge himself where
he sits without a jury to decide (see Omonuwa v. Wahabi
(1976) 4 S.C. 37). The learned trial Judge is therefore quite c
in order to award interest on a short-term deposit account as
general damages, even though the respondents have not
specifically adduced any evidence over the issue. Also, I
entirely agree that an award of N6,000 per year over a
d
N50,000 short term deposit account is reasonable. That
appeal also fails.
Mr Aluko-Olokun moved on to the issue concerning ex-
hibits 10 and 12. Those were cheque No. 366830/001301 for e
N76,000 and cheque No. 366830/001303 for N40,000. He
argued that the cheques were not referred to in the statement
of claim. Counsel also alleged that nowhere in the pleadings
was the allegation made that the first appellant wrote exhib-
f
its 9, 11, 72, 74, 79, 87, 88, 94, 95, 97 and 99. In answer to
the above submission, Mr Bayo Ojo, referred to paragraphs
9 and 10 of the statement of claim which read thus:–
“9. The plaintiffs also aver that specifically between 1984 and
1988 the defendant, acting for himself and the 2nd defen- g
dant, fraudulently manipulated the said four accounts to the
plaintiff’s detriment in breach of the banker/customer rela-
tionship between them.
10. The plaintiffs aver that they became embarrassed and their h
business suffered as a result of the position of these per-
sonal and company’s accounts and as a result, they commis-
sioned Messrs Olusola Adekanola and Co., a firm of
Chartered Accountants to carry out an independent investi-
gation on the account in November, 1988.” i
Counsel then argued that the pleading was supported by
evidence where PW2 denied issuing exhibits 10 and 12. I
have read carefully the judgment of the learned trial Judge
on these cheques. I must admit that it is interesting to read j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 233

a how the learned Judge painstakingly considered how the

cheques were issued and cashed. I understand the argument
of Mr Aluko-Olokun that the cheques were not specifically
b mentioned in the pleadings. But there is a general damages
reference about the issuance of cheques and manipulation of
the respondents’ accounts. Mr Ojo argued that the cheques
they issued were No. 366830/265301A for N33,791.56k and
c cheque No. 366830/265303 for N300. Both have been found
by the chartered accountant to have been cancelled. N76,000
were later withdrawn from the first respondent’s account
through the use of a cheque No. 366830/001301 and
d N40,000 were also withdrawn through the use of the cheque
No. 366030/001303. The learned trial Judge established,
through the evidence of the chartered accountants, PW1. that
those two cheques did not emanate from the cheque book of
e the first respondent because his cheque book had still 56
leaves yet to be used and the number of the last cheque leaf
is 366830/001300. When first appellant gave evidence he
could not establish that a new cheque book had been sup-
f plied to the first respondent. If one reads the answers given
by the first appellant when he gave evidence as DW1 one
can be convinced that the first appellant had been involved
in manipulation of the account of the respondents. I will
g reproduce an extract for easy perusal:–
“I see exhibit 126. It belongs to the 1st plaintiff. It has not been
exhausted. The number of the last cheque leaf in exhibit 126 is
001300. In exhibit 126, there are 56 unused cheque leaves. Exhibit
h 126 is a booklet of 100 cheques leaves. A customer is given a new
cheque book when the old one is exhausted, and also when the old
one is lost. Exhibit 10 was made out for N76,000. The number of
exhibit 10, is 001301. The number of the cheque in exhibit 10
i ought to come after the unused cheque leaf in exhibit 126. I see
exhibit 102, it is for the sum of N33,791.56. The cheque No. is
265301A, dated 16/7/87. I see exhibit 58 and I see the transaction
dated 30/12/87, the cheque which was remitted on that day is
cheque No. 001301 for N76,000. If a cheque is for instance 301A,
j it is reflected in the ledger as simply 301.”
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
234 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Mr Ojo also referred to the remaining cheques earlier listed a

above and urged the court to look at the writing in exhibits
10, 18 and 139 which the first appellant admitted writing.
Counsel argued that one does not need a handwriting expert b
before coming to the conclusion that the same writer wrote
the remaining cheques. After looking at the cheques, I agree
that the learned trial Judge was absolutely correct that the
same writer wrote those cheques. Here again I agree with Mr c
Ojo that the arguments on grounds 12 and 13 have failed.
Issue No. 5 was formulated by the learned Counsel for the
appellant against ground 1. This is the omnibus ground and
it is trite that since there is imputation of crime against the d
first appellant, the claim and allegations must be proved
beyond reasonable doubt. I think Mr Aluko-Olokun has a
particularly bad case. It was opened through the discovery of
an illegal withdrawal of N8,000 from the account of the first e
respondent and when the first appellant was confronted he
admitted taking out the money. He refunded the money and
was issued with a receipt. It is quite clear that the first appel-
lant had admitted doing many unprofessional acts as a f
banker against the accounts of the respondents. Consider the
following:–
“I see exhibit 1, the amount in words is different from the amount
in figures, but the cheque was honoured. I agree that exhibit 1 g
ought not to have been honoured. I see exhibit 3. The amount in
words is also different from the amount in figures. but the cheque
was honoured.”
I also refer to the evidence of DW2, Hadizat Kubura Ameso. h
She is the manager of Sokoto Market branch of Union Bank
Nig. Ltd. She too was alleged to be involved in writing
cheques for PW2. I refer to part of her evidence where her
role was also found questionable:–
i
“I was not negligent in authorising payment in exhibits 1 and 3. I
agree I erred in authorising payment on exhibits 1 and 3. The sig-
nature of the 1st plaintiff appears on exhibits 1 and 3. When exhib-
its 1 and 3 were presented, I did not see the 1st plaintiff
physically.” j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 235

a I am quite satisfied, after going through the pleadings and

evidence that the learned trial Judge evaluated the evidence
properly and concluded his judgment by giving regard to the
b weight of evidence adduced before him.
The argument of the learned Counsel for the appellants in
support of issues nos. 6 and 7 are to me the weakest, consid-
ering the overwhelming evidence against the honouring of
c cheques No. 366830/000667 for N1,000 which was altered
to N9,000 and cheque No. 366830/000320, also for N1,000,
which was altered to N4,500. The amount in the first cheque
was written thus “One thousand only”, but the amount in
d figures was recorded as “N9,000 only”. In the second
cheque, the same method was followed. This time the writ-
ing was made in Hausa language. Thus it was written
“Naira dubu” and in figures “N4,500”. In both cases the
e highest amount had been cashed. Both cheques were pleaded
in paragraph 22(d) and (e) of the statement of claim and
evidence was adduced by both PW1 and PW4 showing the
clear discrepancies on the face of the two cheques. The first
f appellant admitted that cheque No. 1 was wrongly cashed
and he personally authorised payment for the cheque. He
refunded the N8,000 and received a receipt for the said re-
fund. The evidence which the learned trial Judge believed
g does not in anyway deviate from the pleadings (see Ajibade
v. Mayowa (1978) 9–10 S.C. 1. See also U.D.C. v. Ladipo
(1971) 1 All N.L.R. 102).
I have dealt with matters disclosed in issues no. 8 and 9
h above in the judgment and I do not intend to repeat them. It
is always advisable for parties formulating issues and fram-
ing grounds of appeal to try and avoid repetitive issues and
grounds. Repetition does not improve one’s argument fur-
i ther.
Equally exhibits 9, 11, 72, 74, 79, 87, 88, 94, 95, 97 and 98
had been well considered in this judgment above where I
mentioned that I agree with the learned trial Judge’s opinion
j that the first appellant was the writer of those exhibits of
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
236 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

cheques. The appellants have not advanced any argument to a

convince me that the trial Judge’s opinion was erroneous.
The particulars in support of ground 6 under which issues
Nos. 13 and 14 were framed have also been dealt with under b
issue No. 3. I have made considerable finding on that issue
and Mr Aluko-Olokun is only repeating the short and precise
argument which he advanced against the award of N30,000
as general damages over the loss of interest when the first c
respondent’s short deposit account was transferred without
his authorisation.
I now refer to the argument the learned Counsel for the
appellants advanced in support of the issue formulated d
against ground 7. This issue concerns an award of the sum
of N316,309.84. Before the commencement of the trial, the
chartered accountant employed by the first respondent to
investigate the matter concerning his accounts sent a letter e
seeking for the appellants to produce a number of cheques
(listed) for the accountant’s perusal. The bank produced
some waste cheques, and wrote back saying that it could not
supply some of the cheques required, because they were in f
the bank’s archives. The relevant evidence explaining the
bank’s inability to produce the cheques is pertinent to this
appeal. I reproduce the answer given by the first appellant,
in his evidence as follows:– g
“I see exhibit 128H, all the cheques listed therein are not in Court.
23 of the cheques are before the Court. The rest of the cheques are
in the archives of the 2nd defendant. They are still with the 2nd
defendant. They are not in court because they are very difficult to
bring. I see exhibit 128I, not all the cheques listed therein are be- h
fore the Court. 66 of them are before the court, but the rest for the
same reasons stated above cannot be brought.”
The total amount of the cheques was N316,309.84. The
learned trial Judge considered the bank’s failure to produce i
the cheques in his judgment and also took note of the fact
that the first respondent had testified to the fact that a num-
ber of cheques said to have been cashed by him were forger-
ies. The first respondent said that he could not remember j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 237

a having signed them. Now the learned trial Judge considered

the evidence adduced in respect of some of the cheques
produced and since some of them have been found to have
b been forged, the learned trial Judge applied the provisions of
section 148(d) of the Evidence Act and found as follows:–
“From the evidence of DW1, I am satisfied that the waste cheques
exist. I am also satisfied that since some of the waste cheques were
produced, the others could be produced. I am, satisfied that they
c
have not been produced and that they are being withheld by the
defendants who could very well have produced them. Accord-
ingly, I hold that if the waste cheques had been produced, they
would have been unfavourable to the defendants. I am left with no
d alternative than to hold the 2nd defendant having failed to produce
the waste cheques for the contentious debits are liable to PW2 in
conversion in the sum of N316,309.84, the total value of the
cheques not produced.”

e It was on the above finding that Mr Aluko-Olokun based

issue no. 15. He argued unconvincingly that no notice to
produce was actually served on the appellants. But the first
appellant admitted that they received the notice but could
not produce the cheques because they were in the second
f
appellant’s archives and difficult to be brought. The Counsel
is here in open conflict with the evidence adduced for the
appellants before the trial court. It makes the argument of
Mr Aluko-Olokun even weaker when it is observed that 23
g of the cheques applied for had been produced before the
Court. Mr Ojo submitted that those cheques were pieces of
documentary evidence in existence which the appellants
refused to bring before the Court because their contents
h would be against the appellants’ interest. He further submit-
ted, quite rightly, in my view, that the conditions for the
applicability of section 148(d) of the Evidence Act as al-
luded to by the Supreme Court in Awosile v. Sotunbo (1986)
i 3 N.W.L.R. (Part 29) 471 at 487 have been met in this case,
to warrant the trial Judge rightly applying the provision of
the law.
I quite agree with the submission of Mr Ojo, and from
j the evidence, both oral and documentary, from the printed
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
238 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

records, the learned trial Judge had no alternative but to a

apply the provisions of section 148(d) of the Evidence Act
and accept that those cheques could not be produced because
the appellants knew that, if they were, their contents would b
be against the interests of the appellants.
The last issue over the interest charged against the over-
drawn account cannot be considered now because the case
concerning the overdrawn account has been struck out. The c
interest cannot reasonably be claimed without considering
the overdraft facilities which were said to have been granted
to the first respondent. The learned trial Judge made a find-
ing over the issue in the following decision:– d
“I observed that the plaintiffs are claiming a refund of the undue
interest charged amounting to N390,146.85, under the claim for
special damages. This in my view is unjustified and unsustainable
as there is no evidence that the plaintiff paid the interest charged. e
The best the court can do in the circumstances is to hold that the
interest charges are not justifiable and the plaintiffs are not liable
to pay. Accordingly, I find that the interest charged amounting to
N390,146.85, are undue, and unjustified and the plaintiffs are not
liable to pay.” f
It was the very learned trial Judge who exercised his discre-
tion and struck out the overdraft claim. Now since the issue
has not been decided yet the question over how much inter-
est must be paid against the overdraft does not arise. The g
learned trial Judge is in error to find that the interest was
undue and unjustified. He was also in error to declare that
the respondents were not liable to pay interest against the
overdraft. Ground of appeal no. 16 therefore succeeds. The h
order made by the learned trial Judge that the first respon-
dent is not liable to pay interests against the overdraft
granted to him by the second appellant is hereby set aside.
The order needs not be made since the claim of the second i
appellant in the counter-claim has been struck out.
Apart from the issue of interest charged against the claim
in the counter-claim for payment of the overdraft which the
learned trial Judge erroneously made, this appeal fails and it j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, KADUNA DIVISION)
Mohammed JCA
Bala Angyu Ltd v. Alhaji Shehu Malami Majidadi Alkanci 239

a is dismissed. The respondents are entitled to the costs of the

appeal which I assess at N700.
MUSDAPHER JCA: I have had the opportunity to read the
b draft of the judgment of my Lord Uthman Mohammed JCA
just delivered and with which I am in total agreement. For
the reasons advanced by him, which I hereby adopt as mine,
I too do hereby find the appeal mostly unmeritorious and I
c therefore agree with all the consequential orders made in the
aforesaid judgment.
OKUNOLA JCA: I have had the opportunity to read the lead
judgment just delivered by my learned brother, Uthman
d Mohammed JCA, with which I am in total agreement with
all his reasoning and conclusions. I also abide by the orders
made in the said judgment as to costs.
Appeal dismissed.
e
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)

240 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Oloyede Adejuwon v. Co-operative Bank Limited
and others
COURT OF APPEAL, BENIN DIVISION b
EJIWUNMI, ADIO, KOLAWOLE JJCA
Date of Judgment: 17 JANUARY 1992 Suit No.: CA/B/39/90

Banking – Merger of accounts – Right of banker to merge c

two separate accounts – Scope
Banking – Merger of accounts – Transfer of money from one
customer’s account to another in the same – Where effected
without customer’s consent – Effect d
Facts
The first appellant, a businessman and an industrialist was
the managing director of the second appellant, a registered e
company. Both appellants were customers of the respondent
commercial bank and they both maintained savings and
current accounts with the respondent at its Akure Branch
where the transaction that led to the present appeal took f
place. In the course of a banking transaction between the
parties the second appellant, acting through its managing
director, the first appellant, applied to the respondent for a
bank guarantee to enable the company execute a contract for g
International Breweries Limited Ilesha and, pursuant to this
need, the first appellant requested the respondent bank to
transfer the sum of N60,000 from the second appellant cur-
rent account into the first appellant’s savings account and
h
the transfer was effected as instructed. Subsequent to the
transfer of the aforesaid sum, it turned out that the guarantee
was no longer needed to execute the contract, and this de-
velopment was to the knowledge of the respondent. The
respondent thereafter without the consent and authority of i
the first appellant unilaterally transferred the sum of
N60,000 back from the first plaintiff savings account into
the second plaintiff current account, and this unilateral act of
the respondent angered the first plaintiff who immediately j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)

Oloyede Adejuwon v. Co-operative Bank Ltd and others 241

a commenced the legal action which culminated into the pre-

sent appeal. At the trial court the appellant claimed:–
(a) Declaration that the purported transfer of the sum of
b N60,000 belonging to the plaintiff from his savings ac-
count no. 21242 with the defendant into the current ac-
count of Ositelu Brothers (Nig.) Ltd. Akure without the
knowledge and consent of the first appellant is ultra vires
c null, void and of no effect.
(b) An order for the payment of the sum of N60,000 plus
interests due thereon from 19th May, 1982 until judg-
ment is delivered be made payable to the first plaintiff by
d the defendant.
Upon conclusion of hearing the learned trial Judge refused
the reliefs sought for by the appellants. Aggrieved, the ap-
pellants appealed to the Court of Appeal.
e Held –
1. Once a banker agrees with his customer to open two or
more accounts, the banker cannot unilaterally without
the consent of the customer move either assets or liabili-
f ties from one account to the other, since the basis of his
agreement with his customer is that the two accounts
shall be kept separate.
2. In the absence of any agreement or of circumstances
g from which such agreement could reasonably be im-
plied, a bank has no power to transfer money from the
account of one customer to the account of another cus-
tomer.
h In the instant case, since there were in existence two
separate accounts, the first account was in the name of
second appellant, Ositelu Brothers Ltd, Akure and the
other in the name of Oloyede Adejuwon, it was wrongful
i for the respondent bank to have transferred assets in the
savings account of the first appellant to the current ac-
count of the second appellant as the two accounts are
separate accounts, held by different persons.
j Appeal allowed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)

242 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Cases referred to in the judgment a

Nigerian
British and French Bank Ltd v. Opaleye (1962) 1 S.C.N.L.R.
b
60

Foreign
Buckingham and Co v. London and Midland Bank (1895) 12
TLR 70 c
Greenhalgh (W.P.) and Sons v. Union Bank of Manchester
(1924) 2 K.B. 253

Counsel d
For the appellants: Adegoroye
For the respondent: Akingbade
e
Judgment

EJIWUNMI JCA: (Delivering the lead judgment) In the

court below in Suit No. AK/122/87, the plaintiffs com-
menced this action against the defendant asking for the fol- f
lowing reliefs:–
(a) Declaration that the purported transfer of the sum of
N60,000 belonging to the first plaintiff from his savings
account no. 21242 with the defendant into the current ac- g
count of Ositu Brothers (Nig.) Ltd, Akure without the
knowledge and consent of the first plaintiff is ultra vires,
null, void and of no effect.
(b) An order for the payment of the sum of N60,000 plus h
interests due thereon from 19th May, 1982 until judg-
ment is delivered be made payable to the first plaintiff by
the defendant.
The parties following the order for pleadings, duly filed and i
exchanged same. At the trial, the first plaintiff gave evidence
in his behalf and that of the second plaintiff, and called
no further witnesses. Similarly the defendant called only
one witness, and at the close of the hearing of evidence, j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
Oloyede Adejuwon v. Co-operative Bank Ltd and others 243

a following addresses by learned Counsel for the parties, the

learned trial Judge delivered a considered judgment at the
end of which the reliefs sought by the plaintiffs were re-
b fused.
The facts leading to the judgment on appeal are fairly sim-
ple and straightforward and may be stated basically as fol-
lows: The first plaintiff is a businessman and an industrialist,
c while the second plaintiff is a registered company with the
first plaintiff as its managing director. The defendant is a
commercial bank and has a branch in Akure where the
transactions that led to the present action took place. The
d two plaintiffs are customers of the bank, and the first plain-
tiff had been such a customer since 1977. It is an admitted
fact that on 18th May, 1982, the second plaintiff acting
through the managing director, the first plaintiff, applied to
e the defendant for a bank guarantee to enable the company to
execute a contract with the International Breweries Limited
Ilesha. To this end, the first plaintiff asked that a sum of
N60,000 be transferred from the second plaintiff’s current
f account no. 346 into a savings account in the name of the
first plaintiff. But afterwards it transpired that the defendant
refused to approve the guarantee as the Akure Branch of the
defendant did not have the requisite power to grant the said
g guarantee. In any event, the first plaintiff claimed that he no
longer needed the guarantee of the defendant as the Interna-
tional Breweries paid the mobilisation fee of N100,000 to
the first plaintiff to execute the contract between them. That
sum was paid to the defendant on 24th May, 1982 (see ex-
h
hibit B). Now, as far as the plaintiffs were concerned, the
transaction with the defendant remained as agreed. The first
plaintiff claimed that he did not authorise the defendant to
pay any part of the sum of N60,000 transferred from the
i current account of the second plaintiff into the savings ac-
count opened in his name. And as far as he is concerned, the
second plaintiff was always in credit, and was not aware of
any debit in its accounts with the defendant. In any event,
j the first plaintiff claimed that the defendant never informed
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
244 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

them of their accounts as no statement of accounts were a

forwarded to them by the defendant. The defendant on the
other hand while admitting that the first plaintiff caused the
sum of N60,000 to be transferred into a savings account b
made out in his name from the current account standing in
the name of second plaintiff, it claimed that that sum stood
as a guarantee against the loan guarantee sought by the first
plaintiff. When the first plaintiff wrote to the defendant that c
the loan was no longer required, the defendant caused the
said sum of N60,000 to be transferred back into the current
account standing in the second plaintiff’s name.
As I have said above, the learned trial Judge found against d
the plaintiffs hence this appeal. In pursuance thereof, the
plaintiffs filed three grounds of appeal. In accordance with
the Rules of this Court, briefs of arguments were filed and
exchanged for and on behalf of the parties by their respec- e
tive Counsel. The plaintiffs from henceforth shall be referred
to as appellants and the defendant/respondent.
The appellants in their brief, their learned Counsel set
down two issues for the determination of this appeal. They f
read:–
“(1) That the Lower Court having rejected the respondent’s plea
of first appellant’s authority to exercise right of lien over
the first appellant’s deposit which he said he did as per
paragraphs 4 and 5 of the statement of defence is it right to g
have dismissed the appellant’s case on the basis of exhibits
‘A’ and ‘C’ which did not in any way affect the appellants
case unfavourably? and
(2) Since the respondent had in his statement of defence para- h
graph 1 admitted the salient fact, in issue, have the appel-
lants any further need to prove admitted facts by evidence?”
For the respondent, the following are the issues identified in
the respondent’s brief for the determination of this appeal:– i
“(1) Whether the defendant/respondent’s admission in para-
graph 1 of his statement of defence relieved the plaintiff of
proving that the transfer of the sum of N60,000 from first
appellant Saving Account No. 21242 by the defendant/
respondent is ultra vires, null and void and of no effect. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
Oloyede Adejuwon v. Co-operative Bank Ltd and others 245

a (2) Whether the plaintiff/appellant discharged the burden of

proof placed on them as plaintiff at the court below as to be
entitled to judgment.
(3) Whether on grounds of public policy equity and good con-
b
science having regard to the circumstances of this case the
appellants are entitled to judgment for recovery of a further
sum of N60,000.”
After a careful perusal of the pleadings, the evidence led at
c
the trial, the judgment of the lower court, and the grounds of
appeal filed against that judgment, it seems to me that the
main issue for consideration in this appeal is whether the
respondent as bankers of the appellants is entitled to transfer
d funds from the account of the first appellant to that of the
second appellant without obtaining the prior consent of the
first appellant.
It is common ground from all the facts revealed in this case
e
that the first appellant caused the respondent to open a sav-
ings account in his name with the transfer of the sum of
N60,000 from the current account that was in operation by
the second appellant with the respondent bank. It is also
f common ground that after some time, the respondent caused
the said sum of N60,000 to be transferred back from the
savings account of the first appellant into the current account
that was being operated by the second appellant.
g
It is also not disputed that the first appellant was the man-
aging director of the second appellant and was therefore, at
least a signatory, if not the sole signatory of the cheques of
the second appellant. However, be that as it may, the conten-
h
tion of the first appellant is that he did not authorise the
respondent to transfer the sum of N60,000, deposited in his
savings account with the respondent into the account of the
second appellant. But for the respondent, on the other hand,
i it is argued that the respondent has every right to effect the
transfer in order to bring the account of the second appellant
into credit. It is further argued for the respondent that such a
transfer is justified because the two accounts are operated by
j the same person.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
246 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Now, though learned Counsel for the parties did not cite a
any decided case to justify their submissions, I will refer to
the case of British and French Bank Ltd v. RA. Opaleye
(1962) 1 All N.L.R. 26, (1962) 1 S.C.N.L.R. 60 where, upon b
facts similar to these that have arisen in this case, the learned
Counsel for the appellant in that case advanced arguments of
the kind now urged upon us in this appeal.
The Federal Supreme Court in the British and French c
Bank case (supra) refused to accept the contention of the
appellant that a bank can transfer funds from two separate
accounts of a customer without the consent of a customer,
and dismissed the appeal of the bank. The main facts in the d
British and French Bank case (supra) that led to the appeal
in that case as stated at page 27 of the judgment reads thus:–
“Mr Opaleye, the customer, had two accounts at the Bank, one in
his own name, and another in the name of Fekerno Brothers, of e
which he was the sole account holder, and which will be referred
to as the firm’s account. The firm’s account was overdrawn to the
extent of £500, and when a cheque of £350 was paid into the pri-
vate account the Bank decided to utilise money from the private f
account in order to reduce the overdraft in the firm’s account and
told the customer that he could not draw on his private account.
Then the customer told Bank that the £350, less his commission,
belonged to a stranger whose property he had sold, but this aspect
of it does not seem to make any difference in the case. The point in
g
the case is whether the Bank was entitled to combine the two ac-
counts without notice and without the consent of the customer.
The learned Acting Chief Magistrate thought not, and the learned
Chief Justice thought not also. The Bank has argued that that was h
mistake in law.”
Bairamian FJ who delivered the lead judgment considered
the following cases: Garnett v. M’kewan (1872) 2 L.R. 8 Ex.
10; Greenhalgh (W.P.) and Sons v. Union Bank of Manches- i
ter (1924) 2 K.B. 253; Buckingham and Co v. London and
Midland Bank (1895) 12 T.L.R. 70 and referred to the state-
ment of law given in Volume 2 of Halsbury’s Laws of Eng-
land (3ed) at 172 paragraph 322, which reads:– j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
Oloyede Adejuwon v. Co-operative Bank Ltd and others 247

a “Combination of different accounts unless precluded by agree-

ment, express or implied from the course of business, the banker is
entitled to combine different accounts kept by the customer in his
own right, even though at different branches of the same bank, and
b to treat the balance, if any, as the only amount really standing to
his credit.”
Bairamian FJ, commenting upon this statement of the law
then said at page 28 thus:–
c
“The point about the customer having different accounts ‘in his
own right’ is probably this, namely, that he has both accounts in
his name, and that neither account is a trust account.”
His Lordship then considered in depth Garnett v. M’Kewan
d and Greenhalgh’s case (supra), before quoting with ap-
proval, the dictum of Swift J in the Greenhalgh’s case (su-
pra) by saying at page 29 of his Lordship’s judgment thus:–
“Here we are concerned with the question of moving money from
e one account to another. Swift, J., said in the Greenhalgh case at
page 164:–
‘If a banker agrees with his customer to open two or more ac-
counts, he has not, in my opinion, without the assent of the
f customer, any right to move either assets or liabilities from the
one account to the other, the very basis of his agreement with
his customer is that the two accounts shall be kept separate,
and if the customer pays bills drawn upon him not into his
general account, where they will be discounted and he will re-
g ceive the benefit of being able to draw against them, but into
an account in which they will only be used either to pay bills
accepted by the bank or bills drawn by the customer which
they are specifically to meet, I do not think a banker, any more
h than any other individual can change them from the one ac-
count into the other without the customer’s assent. On this
point it seems to me that the only question to be decided is,
what is the agreement between the banker and the customer?
And, if that agreement is, as I find it to be in this case, that
i there shall be a general account into which bills are paid as
cash and that there shall be an account into which bills shall
be paid for some other purpose, bills or their proceeds cannot
be moved from one account to the other at the whim of the
banker without the consent, express or implied, of the cus-
j tomer.’
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
248 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

It turns out to be a question of the agreement between the cus- a

tomer and the bank. Apparently, as one may infer from the open-
ing part of that passage, the agreement to keep the two accounts
distinct and separate is inherent in the fact that the banker has
agreed with his customer to open two or more accounts.” b
His lordship Bairamian FJ continuing, illustrated the princi-
ple further by saying as follows at page 30:–
“If the bank may merge them without notice, one can see that it c
may do him great harm. Suppose, for example that the customer
has a private account and a business account; that the business
account is in funds, but the other is in debit, the customer, not
knowing what the bank has done or will do, gives out cheque on
his business account to pay trade debts, say for goods bought. If d
the bank does not honour them on presentation, it will do him
harm. That is illustrated in Buckingham and Co. v. London and
Midland Bank Ltd (supra). There the customer had a loan account
relating to a secured advance, and a current account; the bank
thought that the security was inadequate and transferred the loan e
account to the current account, with the result that cheques given
on the current account were not honoured by the bank. The bank
called evidence of managers of banks for the custom entitling a
bank to close an account without any obligation to give notice. The
f
learned trial Judge Matthew, J. left these questions to the jury:–
(1) Was it the course of dealing between the plaintiff and de-
fendants that plaintiff was to be allowed to draw upon his
open account without reference to his loan account?
(2) If yes, then was the plaintiff entitled to a reasonable notice g
that that course of business would be discontinued?
(3) Was such a reasonable notice given?
The jury answered (1) and (2) in the affirmative and (3) in the
negative, and awarded damages. The dominant point in the case is h
the importance attached to the course of business between the cus-
tomer and the bank.
In effect, the course of business between them implies a contract
by which the relation of banker and customer is regulated. In the i
case in hand, before the £350 was paid into the private account,
that account had a credit of under £2, and the firms’ account had a
debit of £500. Such being the case, the Bank could not say that
they kept an eye on the private account, but the customer could
say that he was being allowed to overdraw on the firm’s account j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
Oloyede Adejuwon v. Co-operative Bank Ltd and others 249

a without reference to the state of his private account and could, in

my view rightly, argue that the case fell within the exception in the
statement of the law given in Halsbury, which was quoted earlier
in this judgment.”
b
The appeal of the bank was dismissed in the British and
French Bank case (supra) as their Lordships of the Federal
Supreme Court concluded that in that case one account is in
the name of Apollo Opaleye, Rafiu Afolabi Bello and the
c
other account is in the name of Fekemo Brothers, and said:
“I think it can be said with justice that that very strongly
implied an agreement to keep them separate and distinct,
without any right on the part of the bank to combine them or
d to transfer assets from one account to the other, at any rate
not without reasonable notice of the intention so to do.”
In the case in hand, and as I have said previously there are
e in existence two separate accounts in operation by the appel-
lants with the respondent bank. The first account is in the
name of the second appellant, Ositu Brothers Limited,
Akure, and the other in the name of Oloyede Adejuwon the
first appellant. Having regard to the decision in the case of
f British and French Bank (supra), to which I have made
copious reference it is quite clear that the defendant has no
right to have transferred the assets in the savings account
standing in the name of Oloyede Adejuwon the first appel-
g lant to the current account of the second appellant Ositu
Brothers Limited, Akure, without the consent of the first
appellant, as the two accounts are plainly separate accounts
and held by different persons.
h
Before concluding this judgment, I deem it proper to ob-
serve that the learned trial Judge in the course of her judg-
ment noted that the first appellant had due notice of the
transfer by reason of the statement of account, exhibit C.
i After a careful perusal of this document, it does not seem to
me that the observation of the learned trial Judge is borne
out by the transactions entered into that account as nowhere
was it recorded that a sum of N60,000 was transferred into
j that account from the savings account of the first appellant.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Ejiwunmi JCA
250 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Be that as it may, it is clear that the first appellant was not a

notified by the respondent of its intention to transfer the sum
of N60,000 from the savings account of the first appellant to
the current account of the second appellant, nor was his b
consent obtained before the money was transferred, and for
the reasons already given, the respondent ought to have been
held liable for its conduct by the lower court.
In the result, this appeal must succeed, and it is hereby up- c
held by me. The judgment and orders of the lower court are
hereby set aside. In its place, it is hereby ordered that the
first appellant shall be paid the sum of N60,000 with interest
fixed at the rate of 10% from 19th May, 1982 until the date d
of this judgment.
As the appellants are entitled to their costs, they are hereby
awarded the sum of N500 only to be paid by the respondent.
KOLAWOLE JCA: I agree. e
ADIO JCA: I have had the advantage of reading in draft the
judgment just read by my learned brother, Ejiwunmi JCA,
and I agree with it. I also abide by the orders made in the
f
leading judgment of my learned brother including the order
for costs.
I, however, want to make some comments by way of em-
phasis. The facts have been fully set out in the lead judg- g
ment. No evidence was produced to show that any of the
appellants at the time of opening any of the accounts or at
any time thereafter agreed that the respondent could do what
the respondent did without the consent of the appellants. In
h
the absence of any agreement or of circumstances from
which such an agreement could reasonably be implied, the
respondent had no power to transfer money from the account
of one customer to the account of another customer. In the
present case, the appellants knew that the sum of N60,000 i
had been transferred to the savings account and they knew
that the guarantee which they thought was needed was no
longer necessary. They, however, refrained from requesting
that the said sum of N60,000 be re-transferred to the current j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, BENIN DIVISION)
Adio JCA
Oloyede Adejuwon v. Co-operative Bank Ltd and others 251

a account. The reasonable inference was that they wanted the

said sum of N60,000 to remain in the savings account so as
to earn interest like any other money deposited in a savings
b account. Such intention or wish which was perfectly legiti-
mate and lawful could not be frustrated by the unilateral act
of the respondent.
It is for the foregoing reasons, and the fuller reasons given
c by my learned brother in the lead judgment that I agree with
it.
Appeal allowed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)

252 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Bank of Credit and Commerce International
(Nigeria) Limited v. D. Stephens Industries
Limited and others b
COURT OF APPEAL, PORT-HARCOURT DIVISION
EDOZIE, NDOMA-EGBA, OMOSUN JJCA
Date of Judgment: 23 JANUARY 1992 Suit No. CA/E/260/88

c
Banking – Banker and customer relationship – Bank closing
account on customer’s request – Motive of customer while
making the request – Whether material
Banking – Banker and customer relationship – How termi- d
nated – Whether bank can unilaterally and arbitrarily ter-
minate same
Banking – Customer’s account – Banker’s right to unilater-
ally and arbitrarily close same e
Banking – Wrongful dishonour of cheque – Damages arising
therefrom – Parameter for award of

Facts f
The respondents were the plaintiffs and the appellants the
defendants in the lower court. The second respondent is the
managing director of the first respondent, a limited liability
company which manufactures tarpaulin products in Port g
Harcourt. The first respondent maintained current account
no. 01002915 with the first appellant a commercial bank at
its branch located at No. 27, Aba Road, Port Harcourt
wherein the second appellant was the manager of the said h
branch.
On 20th June, 1984 Rivers State Government cheque for
the sum of N255 drawn on Pan African Bank limited was
paid into the account of the first respondent with the first i
appellant. The second respondent who was a signatory to the
respondent account with the appellant honestly believing
that cheque paid in would have matured before 26th June,
1984, issued a cheque for the sum N230, i.e. exhibit B, in j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)

Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 253

a favour of the first respondent on the strength of the maturity

of the Rivers State Government cheque already paid into the
first respondent’s account. When the second respondent
b presented the cheque of 26th June, 1984 to the first appel-
lant, he was told that the account was without sufficient
funds to meet the cheque, and same was consequently dis-
honoured and endorsed with the words “Drawer’s attention
c required”. The second respondent angered by this develop-
ment instructed the second appellant, i.e. the branch man-
ager, to close the first respondent account with the branch
and this instruction was dutifully carried out leading to the
closure of the first respondent’s account which was accom-
d
panied by the issuance of banker’s cheque for the sum of
N251.15. The trial court held that the offending words were
libellous, and that the respondent’s account with the appel-
lant had not been duly closed and further that the respon-
e dents were entitled to substantial damages assessed at
N25,000.
The appellant being dissatisfied with the decision appealed
f to the Court of Appeal.
Held –
1. The relationship of banker and customer is in theory
terminable in any of the ways by which contracts may be
g
determined, however in practice the relationship comes
to an end upon the happening of the following:–
(a) Death of the customer;
h (b) Mutual agreement;
(c) Proper notice by one party to the other;
(d) Mental disorder of the customer;
i (e) Bankruptcy or winding-up of either party.
The account in question in this case was closed by mu-
tual agreement of the parties and for there to be mutual
agreement, the customer or respondent in this case re-
j quested or consented that the account be closed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)

254 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

2. A banker cannot unilaterally or arbitrarily close a cus- a

tomer’s account in credit without giving the customer a
reasonable notice of its intention to so close the account.
3. A customer of a bank, whether he is a trader or not, will b
be entitled to damages in cases of wrongful dishonour of
cheques by banks provided such claim for damages
arises in contract. In the instant case the claim for dam-
ages arose in the tort of defamation and not in contract. c
4. Where, on demand of a customer, the bank closes his
account, the motive or disposition of the customer in
making the demand is immaterial.
Appeal allowed. d

Cases referred to in the judgment

Nigerian
e
Adeniji v. Disu (1958) S.C.N.L.R. 40
Amadi v. Okoli (1977) 7 S.C. 57
Atuyeye v. Ashamu (1987) 1 N.W.L.R. (Part 49) 267
Balogun v. N.B.N. Ltd (1978) 3 S.C. 155 at 167 f
Chinwendu v. Mbamali (1980) 3–4 S.C. 31
Ebba v. Ogodo (1984) 1 S.C.N.L.R. 372
Ekanem v. Fetuga (1991) 7 N.W.L.R. (Part 204) 449 at 493 g
Hart v. Hart (1987) 4 N.W.L.R. (Part 63) 105
Idika v. Esiri (1988) 2 N.W.L.R. (Part 78) 563
Ikenye v. Ofune (1985) 2 N.W.L.R. (Part 5) 1 h
Innih v. Ferado Agro and Co Ltd (1990) 5 N.W.L.R. (Part
152) 604
Kakarah v. Imonikhe (1974) 4 S.C. 151
i
Kuti v. Balogun (1978) 1 S.C. 52
Nsirimi v. Nsirimi (1990) 3 N.W.L.R. (Part 138) 258 at 296
Obasi v. Onwuka (1987) 3 N.W.L.R. (Part 61) 364
Ogida v. Oliha (1986) 1 N.W.L.R. (Part 19) 786 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)

Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 255

a Okafor v. Idigo (1984) 1 S.C.N.L.R. 481

Okorie v. Queen (1963) 1 S.C.N.L.R. 24
Okorie v. Udom (1960) S.C.N.L.R. 326
b Onaga v. Micho and Co (1961) 2 S.C.N.L.R. 101
Ozigbo v. C.O.P. (1976) 2 S.C. 67
Sketch Publishing Co Ltd v. Ajagbemokeferi (1989) 1
c N.W.L.R. (Part 100) 678
U.B.A. Ltd v. Achoru (1990) 6 N.W.L.R. (Part 156) 254 at
288

Books referred to in the judgment

d
Halsbury’s Laws of England (4ed) paragraph 8, Volume 3
Lord Chorley The Law of Banking (6ed) Ch. 13, page 319

e Counsel
For the appellants: Shomade (with him Brown)
For the respondents: Anyanwu

f Judgment

EDOZIE JCA: (Delivering the lead judgment) The action

which culminated in this appeal is founded in defamation. It
arose from the alleged wrongful dishonour of the plaintiffs’
g cheque by an endorsement thereon by the defendants with
the words “DRAWER’S ATTENTION REQUIRED”,
which the plaintiffs contend are libellous of them and in
consequence of which, by their particulars of claim, dated
h 3rd October, 1994 in Suit No. PHC/317/84 in the Port-
Harcourt High Court, they claimed against the defendants
jointly and severally the sum of N1,000,000 (One Million
Naira) as damages. Pleadings were duly ordered, filed and
i exchanged. At the trial, the parties gave evidence in support
of their respective pleadings.
In his considered judgment dated 27th January, 1987 the
learned trial Judge, R.P.G. Okara of blessed memory, upheld
j the plaintiffs’ case and awarded them N25,000 as damages.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
256 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The facts which gave rise to the case may be summarised a

as hereunder: The respondents were the plaintiffs and the
appellants the defendants in the lower court. The second
respondent is the managing director of the first respondent, a b
limited liability company carrying on business as manufac-
turers of tarpaulin products in Port Harcourt. The first appel-
lant is a commercial bank and the second appellant its
branch manager at its branch located at No. 27 Aba Road, c
Port Harcourt. The first respondent was a customer at the
said branch where it maintained a current account no.
01002915 to which the second respondent was the signatory.
According to the respondents, on 20th July, 1984, a Rivers d
State Government’s cheque for N255 drawn on Pan African
Bank Ltd. Port Harcourt in favour of the first respondent
was paid into the first respondent’s account with the first
appellant’s branch at No. 27 Aba Road, Port Harcourt, here- e
after to be referred to as the branch simpliciter. Apparently,
in the faith that value might have been given on the cheque,
before 26th July, 1984, the second respondent on that date
made out a cheque for N230 on that account in favour of the
f
first respondent. He presented that cheque, the same day at
the branch but he was told that the account was without
sufficient funds to meet the cheque. He angrily went into the
office of the manager of the branch, that is, the second ap-
pellant, to demand that the cheque be cashed but that was to g
no avail. The respondents’ cheque for N230 was tendered
and admitted as exhibit B, although the appellants main-
tained that it was not the very cheque that was presented.
h
In respect of the Rivers State Government’s cheque for the
sum of N255, the appellants explained that the cheque was
originally paid into the first respondent’s account at the first
appellant’s branch on 11th July, 1984. Thereafter the appel-
lants lodged it for clearing on 12th July, 1984 but it was i
returned on 16th July, 1984 with the endorsement “No
Schedule”. The appellants represented the cheque on Friday,
20th July, 1994 but as clearing rule allows for four days
excluding intervening Saturday and Sunday, value was j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 257

a given for the cheque on 25th July, 1984 when the value of
the cheque, that is, the sum of N255 was credited into the
first respondent’s account at the branch.
b The appellants further explained that it was on 23rd July,
and not 26th July, that the second respondent presented the
cheque for N230, exhibit B, and that as at that date, that is,
23rd July, 1984, the first respondent’s account had only a
c credit balance of N6.75 since the Rivers State Government’s
cheque for N255 had not then matured. On account of that,
the first respondent’s cheque for N230 could not be hon-
oured. The appellants alleged that because the cheque for
d N230, exhibit B, was not honoured, the second respondent
entered the office of the second appellant and having failed
to get him to honour the cheque, demanded, in a fit of tem-
per, that the first respondent’s account at the branch be
e closed. In obedience thereto, the appellants on 2nd August,
1984 closed the account and made out in favour of the first
respondent a banker’s cheque for the sum of N251.15 being
the credit balance on the account.
f The cause of action in this case however is not the appel-
lants’ refusal to honour the first respondent’s cheque for
N230, exhibit B, which is said to be the subject of another
pending suit. The gravamen of the respondent’s case is that
g on 30th July, 1984 the first respondent issued a cheque No.
212516, exhibit A, for the sum of N162.45k in favour of a
company known as “A. John Ibisimewari and Sons Enter-
prises” on the first appellant’s branch. It was issued to the
company, a pharmaceutical company, in payment for drugs
h
sold to the respondents. When the cheque was presented at
the appellants’ branch for payment, it was dishonoured and
endorsed with the words “DRAWERS ATTENTION RE-
QUIRED”, which words were published or addressed to Mr
i Ibisimewari and other officials of the first appellant’s
branch. It is the respondents’ case that by the words com-
plained of, they have been injured in their character, credit
and reputation and have been brought into public scandal,
j odium and contempt, hence the present action. For their part,
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
258 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

the appellants stated that the respondents’ cheque for a

N162.45k, exhibit A, was a crossed cheque and that al-
though dated 30th July, 1984, from the endorsement on it, it
was paid by the drawee into its account with the first bank b
on 8th August, 1984 and was presented to the appellants’
branch through the clearing house on 9th August, 1984.
Since the first respondent’s account with the appellants
branch had been closed on 2nd August, 1984, the cheque,
exhibit A was endorsed with the words complained of. The c
appellants denied that the words complained of bore the
defamatory meaning ascribed to them by the respondents.
Finally, the second respondent denied ordering the appel-
lants to close the first respondent’s account. d
Upon the foregoing facts, the learned trial Judge held that
the offending words endorsed on the cheque, exhibit A were
libellous; that the respondents’ account with the appellant
branch has not been closed and that the respondents were e
entitled to substantial damages assessed at N25,000. The
following extracts contain the highlights of the judgment on
crucial issues:–
1. “In the case of Jayson v. Midland Bank Ltd (1967) 2 f
Lloyds’ Law Report 563, the jury upon being asked
whether the words ‘Refer to Drawer’ lowered the reputation
of the plaintiff in the minds of right thinking people an-
swered in the affirmative – Yes.
g
In the present case, there is evidence of the reaction of the
drawee of the cheque. He first went to give the 2nd plaintiff
a dressing down and later consulted a solicitor who wrote in
exhibit C what PW1 thought of the plaintiffs- a person in-
capable of paying even an amount of N162.45. I recall that h
under cross-examination the 2nd defendant as DW4 agreed
that it was uncomplimentary to refer a cheque for want of
funds. I have also considered closely the innuendoes put
forward by the plaintiffs in their pleadings. While not agree-
ing with all of them, there is no doubt that the words are of i
defamatory nature. I have therefore no hesitation in coming
to the conclusion that the words did indeed lower the repu-
tation of the plaintiffs in the eyes of right thinking ordinary
persons, that is, libellous on the plaintiffs” (P. 86 lines 25–
34, P. 97 lines 1–8). j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 259

a 2. “In summary, it is my finding that the closing of the ac-

count by the defendants was not properly done. If indeed
the 2nd plaintiff demanded closure in a fit of temper the de-
fendants ought to have raised the matter again in a calmer
b and more sober occasion and atmosphere than that de-
scribed by the defendants when the 2nd plaintiff asked that
the account be closed and should have then informed the
plaintiffs in writing when the account would be closed.
Having by conduct led the plaintiffs to believe that the ac-
c count was yet existing the defendants would be estopped
from denying that it was indeed existing” (P. 90 lines 1–11).
3. “I shall now deal with the matter of damages. The publica-
tion was not in the nature of publishing it to the whole
world. It was a rather limited publication. It is recalled that
d there was the contention of the plaintiffs not being traders
and therefore not being entitled to damages to a dishon-
oured cheque. The question of whether or not a person is
entitled to damages on a dishonoured cheque arises when
claim is in contract. Even the case of Balogun v. National
e Bank of Nigeria Ltd (1978) 3 S.C. 155 has widened the
scope of persons entitled to damages on dishonoured
cheques. In any event a company such as the 1st plaintiff
which is said to be a manufacturing company can be said to
be a trader. But the claim here is in libel and the damages to
f be awarded would be considered only in that regard. They
are general damages. The damages claimed are N1 million.
Dr. Onagoruwa has asked the court to take into considera-
tion in awarding damages the way the defence has been
conducted. I agree the defence was very committed to put-
g ting the plaintiffs in a bad light. All the same I do not think
that damage to the extent of N1 million was caused. The
publication was limited and it is my assessment and view
that the sum of N25,000 would be adequate and proper to
award as damages.
h
I therefore award damages in the sum of N25,000. Judg-
ment for plaintiffs accordingly” (P. 90 lines 30 to 34, P. 91
lines 1–22).
It is against the above judgment that the appellants have
i appealed to this Court. The notice of appeal dated 27th Janu-
ary, 1987 contains ten grounds of appeal which read as fol-
lows:–
“1. The learned trial Judge erred in law and on the facts in
j holding that the account of the 1st plaintiff with the 1st
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
260 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

appellant had not been closed at the time material to this a

action when:
i. Chief Warmate who was referred to in paragraph 10 of
the statement of claim and the 2nd plaintiff demanded b
the immediate closure of the 1st plaintiff’s account.
ii. Exhibit D which the learned trial Judge held was not
dated was in fact August 9th, 1994 and was acknowl-
edged to have been received by the 1st appellant on
August 9th, 1984. c
2. The learned trial Judge erred in law and on the facts in
holding that July 30th, 1994 appearing on exhibit A, which
is a specially crossed cheque is the date material to the ac-
tion and not August 9th, 1994, which was the date when d
exhibit A came through the clearing house to the 1st appel-
lant.
3. The learned trial Judge erred in law and upon the facts in
rejecting ‘Reject’, which is the teller written out by 1st e
plaintiff witness and dated August 8th, 1984 for depositing
exhibit A into his action (account).
4. The learned trial Judge erred in law and upon the facts in
not dismissing the claim against the 2nd defendant who was
not acting throughout the transaction in his personal capac- f
ity but as servant and agent of the 1st defendant.
5. The learned trial Judge erred in law and upon the facts in
awarding N25,000 damages which was far in excess of the
damages suffered and was an erroneous assessment of the g
damages in law.
6. The learned trial Judge erred in law and on the facts in
awarding damages in favour of the plaintiffs when there
was no evidence on record that the plaintiff is a trader.
h
7. The learned trial Judge erred in law and on the facts in
awarding N25,000 damages against the defendants when he
held that there was limited publication of libel if any.
8. The learned trial Judge erred in law and upon the facts in i
awarding damages in favour of the 2nd plaintiff who suf-
fered no injuries in respect of exhibit A.
9. The learned trial Judge erred in law and upon the facts in
holding that the account of the 1st plaintiff with the 1st
defendant was irregularly closed when the claim of the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 261

a plaintiffs before him was not for irregular closure of ac-

count of the 1st defendant.
10. The judgment is against the weight of evidence.”
b Briefs of arguments were filed, exchanged and adopted by
Counsel for the parties at the hearing of the appeal. In the
appellants’ brief of argument dated and filed on 24th April,
1990, four issues for determination were formulated at page
c 5 as follows:–
“i. What is the relationship of a banker and customer?
ii. What is the consequence of the breach of the relationship of
a banker and customer where the banker refused to honour
the customer’s cheque?
d
iii Is the date appearing on a crossed cheque issued by a bank
customer to another person which was subsequently paid
into an account at a later date deemed to be the date when
the cheque should be debited in the customer’s account or
e the date appearing on the cheque when it passes through the
clearing house?
iv. Is a customer of a bank who is not a trader entitled to ag-
gravated damages?”
f In the respondents’ brief dated and filed on October 30th,
1990 at page 4 thereof, the following three issues were iden-
tified for determination in this appeal:–
“a. Whether the account of the 1st plaintiff with the 1st
g appellant had been closed at the time material to this ac-
tion.
b. Whether the award of N25,000 as damages to the plain-
tiff against the defendants was excessive in the circum-
stances of this case.
h
c. Whether the 1st plaintiff cannot be regarded as a trader
and therefore entitled to aggravated damages and if it is
not whether the sum of N25,000 awarded by the lower
court can be regarded as aggravated damages.”
i I have examined carefully the above issues for determination
formulated by the learned Counsel for both parties. I have
observed that issues (i) and (ii) in the appellants’ brief are
not directly related to any grounds of appeal. Issues for
j determination are distilled from the grounds of appeal. An
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
262 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

issue not tied to any ground of appeal is improper and will a

not be countenanced (Ogida v. Oliha (1986) 1 N.W.L.R.
(Part 19) 786; Ezekiel Hart v. Ezekiel Hart (1987) 4
N.W.L.R. (Part 63) 105). Again I observe that no issues b
were framed nor arguments advanced on grounds 3, 4 and 8
of the grounds of appeal. It is well settled that a ground of
appeal on which no argument is presented is deemed to have
been abandoned (Ukarico Obasi and another v. Eke Onwuka c
and others (1987) 3 N.W.L.R. (Part 61) 364; (1987) S.C.N.J.
84). Learned Counsel for the respondent in the last para-
graph of his brief at page 9, commenting on the grounds of
appeal stated, inter alia:–
d
“This appeal has not been properly contended by the Appellants.
The grounds of appeal filed by the appellants are not only repeti-
tive but also failed to show particulars of error as claimed by the
appellants” (italics mine).
e
By the italicised words, the respondents appear to be saying
that the grounds of appeal are incompetent for failure to give
particulars of errors alleged. It is observed that the attack on
the grounds of appeal is a preliminary objection, the notice f
of which has not been given in accordance with Order 3
Rule 15(a) of the Court of Appeal Rules, 1981. Learned
Counsel for the respondents did not indicate whether the
objection relates to all the grounds of appeal, for if they did g
and the objection succeeds, the notice of appeal would have
been a nullity. If all the grounds of appeal are incompetent
thereby making the notice of appeal a nullity, the Court of
Appeal has power to strike out the notice of appeal under
h
Order 3 Rule 2(7) of the Court of Appeal Rules (Chief O.N.
Nsirimi v. E.A. Nsirimi (1990) 3 N.W.L.R. (Part 138) 285 at
296; Innih v. Ferado and Co Ltd (1990) 5 N.W.L.R. (Part
152) 604 at 615). It is well settled that a ground of appeal
that alleges errors in law without furnishing particulars is i
incompetent (Okorie v. Udom (1960) S.C.N.L.R. 326;
Adeniji v. Disu (1958) S.C.N.L.R. 408; Okorie v. Queen
(1963) 1 S.C.N.L.R. 24; Obisanya v. Nwoko (1974) 6 S.C.
69 at 77). A ground of appeal alleging an error in law will j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 263

a not however be struck out as incompetent where it has in-

corporated in it the particulars of errors alleged (Atuyeye v.
Ashamu (1987) 1 N.W.L.R. (Part 49) 267; Amadi v. Okoli
b (1977) 7 S.C. 57). I have examined the grounds of appeal
carefully and I take the view that the notice of appeal is not
a nullity. Ground 10 of the notice of appeal is the omnibus
ground which does not require any particulars to sustain
c it. There are particulars to ground one although not specifi-
cally so labelled. Some of the grounds of appeal, for exam-
ple grounds 6 and 7, have incorporated in them the
particulars of error and are therefore not incompetent. I am
d of the view that there are enough competent grounds of
appeal to support the issues for determination which I will
set out anon.
From the grounds of appeal and issues thereon as formu-
e
lated by learned Counsel for the appellants, I consider that
two issues are germane to this appeal. The first and the only
serious issue is whether the learned trial Judge was right in
holding that the first respondents’ account with the first
f appellants’ branch had not been closed at the material time.
The second, which is less serious is whether the award of
N25,000 made in favour of the respondents is excessive. I
will deal with the latter issue first. In his argument in this
g regard, learned Counsel for the appellant at page 14 of his
brief referred to the case of Balogun v. National Bank of
Nigeria Limited (1978) 3 S.C. 155 at 167 and submitted that
it is only a trader who is entitled to substantial damages in
h cases of wrongful dishonour of cheques by banks and by
implication that the first respondent is not a trader. This
contention, with all due respect, is misconceived. As the
learned trial Judge held, rightly in my view, the question of
i whether or not a person is entitled to damages on a dishon-
oured cheque arises when the claim is in contract. The claim
in the instant case is in the tort of defamation and not in
contract. Even if it were in contract, the learned trial Judge
j did find that the first respondent is a trader. This finding is
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
264 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

supported by the evidence of PW2 at page 18 lines 16–19 a

where he said:–
“We manufacture tarpaulin goods. We sell them to customers.
Apart from manufacturing, we also sell and buy goods.” b
In his finding, the learned trial Judge stated at page 91 lines
7–9:–
“In any event a company such as the 1st plaintiff which is said to
be a manufacturing company can be said to be a trader.” c
There is no appeal against the above finding to the effect
that the first respondent is a trader. It follows that, as it is a
trader, the basis of the contention of learned Counsel for the
appellant does not exist. Even if the first respondent were d
held not to be in the business of trading, the judgment of the
learned trial Judge on the question of damages cannot be
faulted.
This is so, because the first respondent, being a manufac- e
turer of tarpaulin products, is a company in business. In the
case of Balogun (supra), the Supreme Court, as observed by
the learned trial Judge, had widened the scope of persons
entitled to damages in dishonoured cheques when it held that f
a solicitor whose cheque drawn on her clients’ account was
wrongfully dishonoured is a person in business and entitled
to substantial damages as it is undoubtedly in business.
Finally, it is well to bear in mind the attitude of the appel- g
late court to award of damages by a trial court. The govern-
ing principle was restated recently by the Supreme Court,
per Nnaemeka-Agu JSC in the case of U.B.A. Ltd v. Achoru
(1990) 6 N.W.L.R. (Part 156) 254 at 288 as follows:– h
“It is useful in this respect to reiterate the governing principle
which has been stated in many English and Nigerian cases. It is
this: that the appellate court ought not to reverse the finding and
verdict of a trial Judge as to the amount of damages merely be-
cause it thinks that if it had tried the case at first instance it might i
have awarded a lesser sum. In order to justify the reversal of a trial
judge on the question of an amount of general damages awarded,
the appellate court ought to satisfy itself either that the trial Judge
acted upon some wrong principle of law or that the amount
awarded was so extremely high or so very low as to make it in the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 265

a opinion of the appellate court, an extremely erroneous estimate of

the damage to which the plaintiff is entitled: See on this Flint v.
Lovell (1935) 1 K.B. 354 (CA), Davies v. Powell Duffryn Collier-
ies (1942) A.C. 601, H.L. Nance v. British Columbia Electric Riv
b (1951) A.C. 601, P. 613 (P.C.); George Onaga and Ors. v. Micho and
Co. (1961) 1 All N.L.R. 324, 105–106; (1961) 2 [Link]. 101.”
In George Onaga and others v. Micho and Co (supra),
Unsworth FJ, delivering the judgment of the Federal Su-
c preme Court, said thus:–
“The last ground of appeal was that the damages awarded to the
plaintiff were excessive. We allowed the ground of appeal to be
argued in so far as it relates to items of general damages but for
d future guidance I would record that a ground of appeal in these
terms is much too indefinite. This court does not intervene on a
question of damages unless the trial judge acted upon some wrong
principle of law or the amount awarded was so extravagant or so
small as to make it an entirely erroneous estimate of the damages.
e In these circumstances, a party appealing against damages should
specify with particularity the wrong principle of law alleged if he
wishes to argue that the judge acted on wrong principle.”
The only alleged wrong principle of law upon which the trial
Judge was said to have acted in the award of damages is that
f
a non-trader whose cheque is wrongfully dishonoured is not
entitled to substantial damages. As has been demonstrated
earlier in this judgment, that principle has no application
from the facts of this case. The appeal on the issue of dam-
g ages therefore fails.
It now remains to consider the more serious and vital issue
in this appeal which is whether the learned trial Judge was
wrong in holding that the plea of justification implicit in the
h
defence of the appellant, that is to say, that the account in
question, had been closed at the material time is unavailing.
I regard this as a vital issue because, if the account had been
closed at the material time then the endorsement of the
i cheque, exhibit A, with the words complained of would not
have been actionable. It is important to appreciate that the
operative moment is the time when the endorsement com-
plained of was made on the cheque, exhibit A, according to
j the appellants, it was on 9th August, 1984 when exhibit A
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
266 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

was presented through the clearing house. If at that material a

time the account in question had not been closed and was in
sufficient funds to meet the value of the cheque, then, in the
absence of any acceptable explanation, the appellants stood b
to be mulcted in damages.
Both in their pleadings and evidence in court, the appel-
lants contended that at the request of the second respondent,
on 23rd July, 1984 they closed the account in question on c
2nd August, 1984 and that the respondents’ cheque, exhibit
A, was presented through the clearing house on August,
1984 after the closure of the account. Paragraphs 12 and 14
of the amended statement of defence are pertinent and they d
read thus:–
“12. The defendants state the 2nd Plaintiff caused so much
commotion at the Bank premises, shouting, abusing the 2nd
Defendant and finally demanded that the 1st Plaintiff’s ac- e
count with the 1st Defendant be closed immediately. The
1st Defendant thereafter closed the 1st Plaintiffs’ account
and made out a bank’s cheque for the sum of N251.15k in
favour of the 1st plaintiff.
f
14. The 1st Defendant states that the 1st Plaintiff through the
2nd Plaintiff requested that the 1st Plaintiff’s account be
closed on July 23, 1984. Thereafter the 1st Defendant
closed the 1st Plaintiff’s account and accordingly informed
the Plaintiff. The 1st Defendant further avers the 1st Plain- g
tiff’s cheque No. 212516 for the sum of N162.45k came
through the clearing house on August 9th, 1984 when the
1st Plaintiff’s account had been closed on August 2nd,
1984.” h
In support of the above averment on the question of the
demand by the respondents for the account to be closed,
DW2, Celina Taka, at page 33 lines 21–26 testified as fol-
lows:– i
“He (2nd plaintiff) was annoyed and shouted at the manager that
he gave him two weeks to leave the country since he did not pay
the cheque . . . In annoyance 2nd plaintiff demanded that his ac-
count be closed.” j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 267

a See also the evidence of DW3 at page 37 lines 9–15, DW4

at page 31 lines 1–3. The respondents in their statement of
claim made no mention about giving instruction that the
b account be closed nor did they file a reply to that effect, but
they did as they were entitled to do, on the authority of
Sketch Publishing Co Ltd and others v. Ahaji Ajagbemoke-
feri (1989) 1 N.W.L.R. (Part 100) 678 lead evidence to deny
c ever giving such instruction. Thus, in his evidence, the sec-
ond respondent, as PW2 testified at page 18 1ines 14 and 15
as follows:–
“I did not authorise the bank to close down my account.”
d
It is evident from the above facts that while the appellants
maintained that the respondent demanded that their account
be closed the respondent denied making such a demand. The
e learned trial Judge did not, it would appear, make any spe-
cific finding on the issue. Instead of doing so, he engaged in
making an unnecessary distinction between a demand to
close an account made in a fit of temper and one made on a
f more sober occasion and atmosphere. Where, on demand of
a customer, the bank closes his account, the motive or dispo-
sition of the customer in making the demand seems to be
immaterial. In The Law of Banking by Lord Chorley (6ed) at
g Chapter 13 page 319 thereof, the learned authors stated that
although the relationship of banker and customer is in theory
terminable in any of the ways by which contracts may be
determined, in practice, it comes to an end in any of the
following ways: (a) death of the customer; (b) mutual agree-
h
ment; (c) proper notice by one party to the other; (d) mental
disorder of the customer; and (e) bankruptcy or winding-up
of either party. The method relevant to this appeal is mutual
agreement. For there to be mutual agreement, the respondent
i must have requested or consented that the account be closed.
The appellants’ case is that the respondents requested or
demanded that the account be closed. The respondents have
denied this. The learned trial Judge failed to make a specific
j finding on this. This is fatal to the judgment.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
268 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Perhaps, a severer blow to the judgment is the reason given a

by the lower court in holding that the account in question
had not been closed. In this regard, the learned trial Judge at
page 88 lines 3–15 had this to say:– b
“I would have thought so myself and so it sounds rather as if the
2nd defendant went on to close the account out of pique, if indeed
the 2nd plaintiff demanded its closure in a fit of temper. DW2 and
DW3 described the demand by 2nd defendant as out of anger. It
was untidily done that the defendants did not there and then even c
ask for the cheque or cheque book that was apparently yet with the
2nd plaintiff. They even continued to send to the plaintiffs state-
ments of their account with them (Exh. F and F1). The statements
of account meant that up to August 1984 the defendants regarded d
the 1st plaintiff as their customer and by conduct made the plain-
tiffs to believe that they were yet customers of the bank and had an
account from which to draw” (italics mine).
Concluding on the closure of the account, the learned trial e
Judge at page 90 lines 7–11 said:–
“Having by conduct led the plaintiffs to believe that the account
was yet existing the defendants would be estopped from denying
that it was indeed existing.”
f
It is manifest from the above extracts that the reason given
by the learned trial Judge for holding that the account in
question had not been closed is that the appellants by their
conduct in sending statements of accounts, exhibits F–F1, to g
the respondents, represented to them that the account was
still in operation and therefore were estopped from denying
that it was so. The question to ask is whether that was the
case of the respondents either in the pleadings or in evi-
h
dence. It was certainly not the case of the respondents. In
Chinwendu M. v. Mbamali and another (1980) 3–4 S.C. 31,
the Supreme Court held that it is not necessary to plead
estoppel in any particular form so long as the matter consti-
tuting the estoppel are stated in such a manner to show that i
the party pleading relies upon them as a defence or in an-
swer. In the instant case, the only averment which has the
semblance of the matter in question is contained in para-
graph 15(iv) of the statement of claim which reads thus:– j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 269

a “15(iv) The current account of the 1st plaintiff with the 1st
Defendant was in funds. The Plaintiffs will rely on a let-
ter dated 9th August, 1988 written to the Managing Di-
rector of the 1st Plaintiff by the 1st Defendant branch at
b Port Harcourt.”
It is respectfully submitted the this averment cannot support
the plea of estoppel referred to by the learned trial Judge.
c The statements of accounts, exhibits F–F1, mentioned were
not tendered by the respondents but by the appellants; the
statements of accounts which the second respondent witness
sought to tender were successfully objected to; there is no
evidence that the respondents saw exhibits F–F1 prior to the
d
issuance of exhibit A. The dates of the last entries in exhibits
F and F1 are 31st August and 31st July, 1984 respectively. If
the respondents ever saw these exhibits it must have been
after 31st July, 1984, that is after the controversial cheque,
e exhibit A, was issued on 30th July, 1984. Therefore the
drawer of exhibit A was not at all influenced by exhibits F–
F1. By raising the issue of estoppel, the learned trial Judge
was making for the respondents a case different from that
f which they have made. It is a well settled principle that the
court is not competent to make a case for a party which the
party did not put forward (Ekanem v. Fetuga (1991) 7
N.W.L.R. (Part 204) 449 at 473; George O. Ikenye v. Ofune
g (1985) 2 N.M.L.R. (Part 5) 1 at 4; Kuti v. Balogun (1978) 1
S.C. 52).
Against the learned trial Judge’s reliance on estoppel, there
exists a strong body of evidence both oral and documentary
h
pointing unequivocally to the fact that the account under
consideration had been closed as at 2nd August, 1984. DW2
and DW3 testified to that fact. Exhibit D is the appellants’
bank draft dated 2nd August, 1984 for N251.15 sent to the
i respondents under cover of appellants’ letter also marked
exhibit D informing the respondents of the closure of their
account on 2nd August, 1984. The letter exhibit D from the
stamp of it was received by the respondents on 9th August,
j 1984. It is my view that in the face of the overwhelming
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT-HARCOURT DIVISION)
Edozie JCA
270 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

evidence pointing to the fact that the account had been a

closed, the learned trial Judge was wrong in holding the
contrary view.
It is trite law that where the court of trial fails to appraise b
the facts and make a specific finding of fact on points which
are crucial to the proper determination of the case before it,
an appellate court will intervene not to set aside the judg-
ment of the lower court on the case (Uzor Idika and others v. c
Ndukwe Erisi and others (1988) 2 N.W.L.R. (Part 78) 563).
Again, it is settled in a long line of cases that an appellate
court will not ordinarily interfere with the findings of fact by
the trial Judge except it is shown that such finding of fact is d
perverse or unsound (see Ebba v. Ogodo and others (1984) 1
S.C.N.L.R. 372; (1984) 4 S.C. 84; Okafor v. Idigo (1984) 1
S.C.N.L.R. 481; Kakarah and another v. Imonikhe and
another (1974) 4 S.C. 151). It is my view that since the e
learned trial Judge had failed to make a specific finding on
whether or not the second respondent demanded that the
account be closed and having contrary to the trend of evi-
dence held that the account had not been closed, that finding f
is perverse and cannot support the judgment.
In the result this appeal succeeds and is allowed. Accord-
ingly, the judgment of the lower court is hereby set aside
and in substitution therefore, the respondents’ claim is dis- g
missed with costs to the appellants assessed at N500 in the
lower court and N750 in this Court.
NDOMA-EGBA JCA: I had the opportunity of reading be-
forehand the lead judgment prepared and just read by my h
learned brother, Edozie JCA. For the reasons given therein
and the conclusions arrived at, I also allow the appeal and
adopt the orders as to cost.
OMOSUN JCA: I have read in draft the judgment of my i
learned brother, Edozie JCA, just delivered. I agree that the
appeal be allowed. A decision should be in accordance with
the law and the court should not strain the law out of sympa-
thy or out of displeasure with a party. Bad cases make bad j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, PORT HARCOURT DIVISION)
Omosun JCA
Bank of Credit & Com. Int. (Nig.) Ltd v. D. Stephens Ind. Ltd & others 271

a law. I am unable to appreciate the learned trial Judge’s rea-

soning that the appellants should have waited for a cooler
atmosphere for tempers to simmer down before closing the
b account. It seems to me that the learned Judge overlooked
the fact that on the cheque being dishonoured, the second
respondent stormed into second appellant’s office to per-
suade him to honour the cheque. He failed. In anger, he told
c him to close the account. A banker’s draft was sent to him
which reflected the amount to his credit in the closed ac-
count. On these facts, the learned trial Judge should have
held that the account was closed and the appellants ceased to
be customers of the bank. On the pleadings and evidence,
d
that was the only conclusion to be reached. It cannot be
otherwise.
The court applies common sense in evaluating the evi-
e dence and drawing inferences from the primary facts. Of
course, a court of appeal usually accepts the trial Judge’s
impression of the witnesses, there is no need for him to
explain why he is, or is not impressed with a witness
f (Ozigbo v. Commissioner of Police (1976) 2 S.C. 67). On
the other hand, the appeal court is in as good a position to
make inferences from the primary facts.
A banker is not entitled arbitrarily to close a current ac-
g count in credit. He must give a customer reasonable notice
(see Halsbury’s Laws of England (4ed) paragraph 48, Vol-
ume 3). That is not the case here. The respondents de-
manded that their account be closed. It is irrelevant whether
h second respondent was in a fit of temper or not. Thereafter
he was effectively communicated that the account was
closed. They had due notification.
For these reasons and the fuller ones stated in the lead
i judgment of Edozie JCA, I agree that the appeal be allowed.
I abide by the order of costs made in the lead judgment.
Appeal allowed.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

272 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

a
Veritas Insurance Co Limited v. Cititrust
Investments Limited
COURT OF APPEAL, LAGOS DIVISION b
SULU-GAMBARI, KALGO, TOBI JJCA
Date of Judgment: 11 FEBRUARY 1992 Suit No.: CA/L/168/91

Illegality – Raising of by court suo motu – Principles appli-

cable c

Interest – Claim of on money lent – Whether makes one a

moneylender
Moneylender – Interest – Claim of interest on money lent – d
Whether makes one a moneylender
Moneylender – When is a person one – Sections 2 and 4
Moneylenders Law Cap 85 Laws of Lagos State
e
Facts
The appellant was sued for the sum of N120,000 with inter-
est, being money payable under a bond of credit guaranteed
by the plaintiff. f
The defendant, not having complied with rules of court,
the plaintiff obtained judgment under Order 10 Rules 1 and
2 of the High Court of Lagos (Civil Procedure) Rules, 1972.
The appellant, greatly dissatisfied with the judgment ap- g
pealed to the Court of Appeal contending in the main that
the transaction was tainted with illegality under the Money-
lenders Law of Lagos State, because the interest charged
was excessive. h
The plaintiff in his pleadings at the lower court claimed,
however, to be an investment company which the appellant
also admitted.
For the purpose of clarity, section 2(c) of the Moneylend- i
ers Law which defines the categories of those who are not
moneylenders provides that:–
“Any person bona fide carrying on the business of banking or in-
surance or bona fide carrying on any business, not having for its j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Veritas Insurance Co Limited v. Cititrust Investments Limited 273

a primary object the lending of money in the course of which and

for the purposes whereof he lends money.”
Held –
b
1. According to the provision of section 2(c) of the Money-
lenders Law of Lagos State, there are three categories of
persons who cannot be called or designated as money
lenders within the meaning of the law. First is a banker,
c second is an insurer and the third category is an omnibus
one. It is the person who does not have for its primary
object the lending of money.
2. The word “primary” contextually means main, major,
d
chief or highest in rank or importance. By the provisions
a person may not necessarily qualify as a moneylender
although he is involved in money lending in so far as he
is able to show that money lending is not his primary ob-
e ject. In other words, once the person is able to show that
money lending is a subsidiary or secondary object, or
merely ancillary, he is not caught by the provisions.

f 3. It is not the understanding of the law that, once a plain-

tiff claims interest on an amount the transaction auto-
matically comes within the ambit or purview of the
Moneylenders Law or any other law.
g 4. The onus of proving that one is a moneylender as pro-
vided under section 4 of the Moneylenders Law is on the
person asserting.
5. In the instant case, since the plaintiff pleaded that he was
h an investment company and the defendant/appellant ad-
mitted so, it has not been proved that plaintiff was a
moneylender.
6. A trial Judge is entitled to raise the issue of illegality suo
i motu. This depends, however, upon the circumstances of
the case. It is not a rule of the thumb nor a rule of the
hand either. He can do so only when the issue is so ob-
vious, so clear and so unequivocal from the pleadings
j before him. The adversary system of our legal system
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

274 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

will not allow a Judge to raise the issue of illegality suo a

motu on mere speculative or conjectional pleadings.
7. Furthermore, illegality of a contract as a defence must be
pleaded. b
Appeal dismissed.

Cases referred to in the judgment

Nigerian c
Abcos (Nig.) Ltd v. Kango Wolf Power Tools Ltd (1987) 4
N.W.L.R. (Part 67) 894
Adejumo v. The Military Governor of Lagos State (1972) 3 d
S.C. 45
Anyaoke v. Adi (1986) 3 N.W.L.R. (Part 31) 731; (1985) 4
S.C. 213
Edun v. Odan Community (1980) 8–11 S.C. 103 e
George v. Dominion Flour Mills (1963) 1 S.C.N.L.R. 242,
(1963) 1 All N.L.R. 71
Lawal v.G.B. Ollivant (1972) 3 S.C. 124
Nasr v. Berini (Nig.) Bank Ltd (1968) 1 All N.L.R. 274 f
Nneji v. Chukwu (1988) 3 N.W.L.R. (Part 81) 184
Obodo v. Olomu (1987) 3 N.W.L.R. (Part 59) 111
Onashile v. Idowu (1961) 2 S.C.N.L.R. 53 g
Paul v. George (1959) S.C.N.L.R. 510, 4 F.S.C. 198
Sodipo v. Lemminekainem OY (1986) 1 S.C. 197
Willoughby v. International Merchant Bank (Nig) Ltd (1987)
1 N.W.L.R. (Part 48) 105 h

Nigerian statute referred to in the judgment

Moneylenders Law (Cap 85), Laws of Lagos State, sections
2(c), 4 i

Nigerian Rules of Court referred to in the judgment

High Court of Lagos State (Civil Procedure) Rules, 1972,
Order 10 Rules 1 and 2 j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)

Veritas Insurance Co Limited v. Cititrust Investments Limited 275

a Counsel
For the appellant: Ojo-Williams
For the respondent: Opasanya
b
Judgment

TOBI JCA: (Delivering the lead judgment) We are called

c upon in this appeal to determine two basic and main issues:
Firstly, the applicability or otherwise of the Moneylenders
Law (Cap 85) Laws of Lagos State in this case; second,
whether a court on vacation has competence and jurisdiction
d to sit and deliver judgment.
We will have a look at them but let me narrate the back-
ground facts first.
Cititrust Investments Limited filed an action in the court
e
below. She is the respondent in the appeal. I can call her
either the respondent for short or the longer name of the
plaintiff/respondent. Either is correct, though I prefer the
former. She claimed the sum of N120,000 with interest at
f the rate of 5% being money payable by the second defen-
dant/appellant under a credit guarantee bond issued by the
latter to secure the repayment of N100,000 with interest. She
is, in short, the appellant.
g
The appellant was duly served the writ of summons. She is
Veritas Insurance Co Ltd. She entered appearance through
her Counsel in the chambers of Messrs Akin Akintoye
Company. That was on 15th July, 1987. Although the re-
h
spondent served the appellant with the statement of claim,
the appellant failed to file her statement of defence within
time. On 10th November, 1987, the respondent applied for
final judgment by summons under Order 10 Rules 1 and 2 of
i the High Court of Lagos (Civil Procedure) Rules, 1972. In
other words, the respondent commenced Order 10 proceed-
ings, a shorter journey to obtaining judgment. Most, if not
all Counsel, like it. They urge the courts to invoke it at the
j slightest turn, they love it.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
276 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The summons for judgment was also duly served on the a

appellant. The appellant did not show up in court when the
summons for judgment was argued on 7th December, 1987.
Ruling was reserved for 29th December, 1987. Came 29th b
December, 1987, the learned trial Judge delivered his ruling.
He gave final judgment to the respondent “in the sum of
N120,000 with interest at the rate of 5% from 28th July,
1987 until the judgment is fully liquidated”. Again the ap- c
pellant was not in court. 29th December, 1987 fell in the
court’s vacation period.
Being dissatisfied with the ruling of the learned trial Judge,
the appellant has come to us. She filed five grounds of ap- d
peal, with particulars. Let me state the grounds of appeal
without the particulars. That is more convenient:–
“(1) The learned trial Judge erred in law in granting judgment to
the respondent without first ensuring compliance with the e
Rules of Court. The judgment was therefore irregular.
(2) Further and or alternatively to ground 1 above, the judg-
ment was null and void having been entered when all the
conditions precedent to the exercise of jurisdiction by the
learned trial Judge had not been fulfilled. f
(3) That the learned trial Judge erred in law in sitting as a court
and then to grant and award costs in favour of the respon-
dent on a day when it lacked competence and jurisdiction in
civil matters. g
(4) Further and alternatively to ground 3 above, the judgment
was null and void and the proceeding wherein the judgment
was entered was incompetent for lack of jurisdiction.
(5) The learned trial Judge erred in law in granting judgment to h
the respondent to enforce payment under a collateral guar-
antee bond when the original loan transaction secured by
the bond was ex facie illegal and unenforceable and when
the issue of illegality of the whole transaction had not been
determined by the Honourable Court.” i
Briefs were filed and exchanged. Counsel for the appellant
formulated thirteen issues for determination, Counsel for the
respondent four. The issues formulated by learned Counsel
for the appellant are not only verbose but prolix, to a near j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 277

a unmanageable detail. They dovetail in some material par-

ticulars. Some of them crash into one another.
An issue is a point in dispute in the litigation. An issue is a
b point on which a question depends. An issue is a question
waiting for the court’s decision or ripe for the court’s deci-
sion. In sum, an issue is a beehive of contest or dispute in
the litigation as claimed by the party formulating or framing
c it.
In Chief Ejowhomu v. Edok-Eter Mandilas Ltd (1986) 5
N.W.L.R. (Part 39) 1, the Supreme Court, following the
decision in Akintola v. Solano (1986) 2 N.W.L.R. (Part 24)
d 598 defined an issue as the question in dispute between the
parties necessary for the determination of the court (see also
Adejumo and others v. Ayantegbe (1989) 3 N.W.L.R. (Part
110) 417; Standard Consolidated Dredging and Construc-
e tion Co Ltd v. Katonecrest Nigeria Ltd (1986) 5 N.W.L.R.
(Part 44) 791; Ugo v. Obiekwe (1988) 2 S.C.N.J. 95; (1989)
1 N.W.L.R. (Part 99) 566).
A case is not argued on the issues formulated. A case is
f argued, strictly speaking, on the body of the brief after the
issues. Where issues are formulated in a way that gives the
impression that the case is argued, they are no more issues
but something else. They have moved away from the pre-
g cinct or province of issues, straying into the arguments in the
brief. That is not proper. That is not good. And too many
issues could give rise to such an impression, if not outright
conclusion. In my humble view, the main function of issues
h is to act as a mirror to the arguments advanced in the brief.
They are periscopic on the arguments in the brief.
Like the adventurist honey explorer in the beehive, who
applies all his professional skill and technical knowhow, to
i avoid a killing sting of the bee, by some sheer manipulation
of some dexterous acumen in the honey-collecting process,
so also is the “issue” formulator. His objective is to win his
case. Like the honey explorer, he does not want to get hurt
j in the process. He is sensitive to his case and he must be.
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
278 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

And so he parochially formulates the issues to his advantage a

and therefore to the disadvantage of the opponent. No court
of law can fault that strategy; after all a party must take its
own case and not that of the opponent. Whether he succeeds b
in the strategy is a different thing altogether.
But the issue here is different. The issues are quite a few
too many. An issue may raise a question of law. An issue
may raise a question of fact. In either case, it brings out in c
clear perspective or focus the law or fact contested. An issue
is really an issue if it is precise, concise and runs directly to
the “pulpit” of the case without equivocation.
Once an issue is formulated, there is no need in repeating d
it. Although the art of repetition is the lawyer’s professional
armoury of firing his points through to the court, courts do
not like unnecessary repetitions, particularly in briefs. The
courts have so little time to chase too many cases and so e
there is need for economy of time all through the litigation
process, either of first instance or in an appeal. And Counsel
have a major role to play in this matter.
In the instant case, quite a number of the issues are victims f
of floody repetitions to the extent that they give rise to bor-
ing and jerky reading all to no avail. Perhaps I can afford to
sound more relevant. Issues Nos. 1, 2, 3, 4, 7, 8 and 10 deal
directly with the Moneylenders Law Cap 85 Laws of Lagos g
State. In my view, Counsel was really in a position to reduce
the issues, and this he could have successfully done by some
little effort at collating and co-ordinating them. It is part of
good formulation of issues for Counsel to take issues to- h
gether rather than separately. Counsel seems to have in-
dulged in the latter. And that is where he went wrong. I
think I have said enough. I should drop it now.
I have carefully examined the issues formulated by Coun- i
sel for the respondent and they appear adequate to me. I
therefore state them in pleno:–
(i) Whether the plaintiff (respondent) proved its case
and was entitled to the judgment obtained and j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 279

a whether the judgment thus obtained was judgment

on the merits or not.
(ii) Whether in this case the plaintiff’s claim was for
b money had and received or for money lent under the
Moneylenders Law.
(iii) Whether the claim of the plaintiff as formulated in
both the writ of summons and statement of claim ex
c facie raises the issue of illegality.
(iv) Whether a vacation court Judge is competent to
deliver judgment during Christmas vacation period,
on a matter he had previously heard and adjourned
d for judgment particularly when the direction by the
authority of the Chief Judge was to the effect that
cases already fixed for the period of the vacation be
heard unless all the parties thereto do not agree.
e
I now take the case of the appellant as presented in both the
main brief and in the reply brief. Learned Counsel for the
appellant, Mr S.L. Ojo-Williams, relied on his brief and
made no oral submission in expatiation thereof. The main
f theme of his argument is that the transaction hovers or piv-
ots around the Moneylenders Law. He therefore predicated
his argument on that law.

g He submitted that the Moneylenders Law prima facie ap-

plies to every contract of loan between all persons and to all
lenders in Lagos State except those exempted under section
2 of the Law or those specifically exempted by the State
Commissioner. He referred the court to sections 2 and 3 of
h
the Law. The Law Counsel submitted further applies to all
persons who lend money at an interest and a presumption is
created that such persons are deemed moneylenders until the
contrary is proved. He referred to section 4. To Counsel, the
i respondent did not rebut the presumption that she was a
moneylender. He submitted further that since the respondent
charged an interest of 20% for three months, she must be
presumed to be a moneylender. Counsel picked holes in the
j judgment of the learned Judge that he failed to consider and
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
280 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

resolve the money-lending status of the respondent vis-à-vis a

the law.
On Counsel’s claim that the respondent was a money-
lender, he argued that in order to obtain judgment under b
Order 10 Rules 1 and 2, she ought to have satisfied Order 3
Rules 4 and 8 which prescribed the nature of the endorse-
ment that a writ of summons in a moneylender’s action must
contain before the writ could be deemed specifically en- c
dorsed and available for summary judgment under Order 10.
It was the submission of Counsel that both the writ and the
statement of claim did not contain sufficient endorsement to
satisfy the requirement of Order 3 Rule 8. d
Replying on the Supreme Court’s decision of Olubusola
Stores v. Standard Bank Nigeria Ltd (1975) 4 S.C. 51 and
Atilade v. Atilade (1968) 1 All N.L.R. 27 at 29, learned
Counsel submitted that non-compliance with the laid-down e
procedure in Order 10, made the judgment of the learned
trial Judge invalid and irregular and should therefore be set
aside.
Still dealing with the nature and ambit of the contract, f
learned Counsel contended that since the respondent charged
interests on the loan, the claim comes within the purview of
section 15 of the Moneylenders Law, the breach of which is
provided for in section 16 thereof. Counsel submitted that g
since respondent was in breach of sections 15 and 16 of the
law, the original loan transaction was consequently illegal.
He relied on Onyuike v. Okeke (1976) 3 S.C. 1 at 7; Da
Rocha v. Hussain 1 F.S.C. 89; (1958) S.C.N.L.R. 280 and h
Chief Sodipo v. Lemminkainen OY and another (1985) 7
S.C. (Part 1) 492 at 526, (1985) 2 N.W.L.R. (Part 8) 547.
Dealing with the issue of the trial Judge giving his judg-
ment during the Christmas vacation, learned Counsel sub- i
mitted that, since the case was a civil matter and not a
criminal matter, the court lacked jurisdiction to deliver the
judgment during the vacation period. To Counsel, a vacation
court can only sit and entertain any civil matters only when j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 281

a Order 48 Rule 5 of the (Civil Procedure) Rules of the High

Court of Lagos State is complied with, i.e. when the matter
is urgent or all the parties concerned request that the court
b should sit. Relying on Madukolu and others v. Nkemdilim
(1962) 1 All N.L.R. 587 at 595; (1962) 2 S.C.N.L.R. 341
and Itaye v. Ekaidere (1978) 9 10 S.C. 34 at 47, Order 48
Rule 6 and Aguda Practice and Procedure paragraphs 33,
c 14 at page 417, learned Counsel urged the court to hold that
the judgment is invalid and to set it aside. He also urged the
court to order a re-trial of the case on its merits.
Learned Counsel for the respondent was not in court to
d present his brief. There being no explanation for his absence,
we took the brief as argued. That is the position of the law.
Where briefs have been filed, the absence of one or all of the
parties and their Counsel does not attract any sanction what-
e soever of the court and the appeal will be treated as having
been duly argued and will be considered as such for pur-
poses of judgment (see Ogbu v. Urum (1981) 4 S.C. 1 and
Adeka and others v. Vaaita (1987) 1 N.W.L.R. (Part 48)
f 134).
And so, I now proceed to deal with the argument in the
brief. Learned Counsel for the respondent, Mr Seye
Opasanya, contended that when money has been received by
g one person which in justice belongs to another, under cir-
cumstances which render the receipt of it a receipt by the
defendant to the use of the plaintiff, the latter may recover as
for money had and received to his use. He relied on Royal
h Bank of Canada and others v. Regem (1911–13) All E.R.
846 at 851. He submitted that since the principal debtor has
failed to pay on the due date, the respondent has the right to
claim the return of the money from the appellant. He relied
i on National Bolivian Navigation Co v. Wilson (1880) A.C.
176, as well as Royal Bank of Canada v. Regem (supra).
Counsel contended further that the action was for money
had and received and not for money lent under the Money-
j lender’s Law, thus making that law inapplicable to the
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
282 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

action. Denying further that the respondent is a money- a

lender, Counsel claimed that she was in fact an investment
company.
Flowing from the above, learned Counsel argued that the b
issue of non-compliance with Order 3 Rule 8 does not arise,
since the transaction that led to the action is not governed by
the Moneylender’s Law. To Counsel, the respondent’s ac-
tion is governed by Order 3 Rules 4 and 5 of the (Civil Pro- c
cedure) Rules of Lagos State. The indorsement made on the
writ of summons commencing the action sufficiently satis-
fied the requirement of the said Orders and Rules of Courts,
Counsel claimed. d
On the issue of illegality, Counsel pointed out that the pa-
pers before the court do not justify the claim of the appel-
lant. In the circumstances of the claim, it was not possible
for the trial Judge to hold that the transaction was illegal. e
Pointing out that the appellant had all the opportunity to
raise the issue of illegality at the trial Counsel submitted that
it was a sham to raise the issue after judgment.
He also submitted that the learned trial Judge was right in f
not considering the issue in his judgment as it was not raised
by any of the parties in the trial. The learned trial Judge was
therefore under no duty to consider and resolve the issue. He
relied on Sodipo v. Lemminkainen OY (1986) N.W.L.R. g
(Part 15) 220 at 233.
On the issue of the excessiveness of interest charged on the
loan, learned Counsel called in aid section 15(1)(a) of the
Moneylenders Law and submitted that the provisions ap- h
plied only to interest chargeable on loans which were calcu-
lated on a yearly basis. It would not apply, for instance, to
interest chargeable on a loan transaction which was repay-
able after a three-month period of its advancement, Counsel i
argued. He submitted that section 15(1)(a) was inapplicable
to the transaction which has given rise to this appeal.
Assuming, without conceding, that the respondent was in
breach of section 15, learned Counsel submitted that the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 283

a appellant’s argument was rather hasty, ill-timed and prema-

ture, having failed to satisfy or explain away the conditions
precedent before such a plea could be raised. He submitted
b that, where injuries were inflicted on an individual under
circumstances which constituted a felony, that felony could
not be made the foundation of a civil action at the suit of the
person injured against the person who had inflicted the inju-
c ries until the latter had been prosecuted or a reasonable
excuse shown for his non-prosecution. Counsel relied on
Smith v. Selwyn (1914) 3 K.B. 98; U.A.C. v. Taylor (1934) 2
W.A.C.A. 67 and A.C.B. v. Ojikutu (1968) A.L.R. (Com-
mercial) 199.
d
Dealing with the delivery of the judgment during the
Christmas vacation of the court, learned Counsel moved into
the realm of interpretation of statutes. In interpreting a stat-
e ute, the intention of the Legislature is paramount, Counsel
contended. To him, the court should deduce the intention of
the Legislature from the words used in the statute when the
words are clear and unambiguous. The court must not infer
an intention which does not appear in the words of the en-
f
actment. The meaning and intention of a statute are to be
gathered from the literal interpretation of the words used
rather than extraneous notions of what is just or expedient,
Counsel argued. He relied on Maizabo v. Sokoto Native
g Authority (1957) S.C.N.L.R. 142, (1957) 2 F.S.C. 13 and
African Newspapers v. Federal Republic of Nigeria (1985) 2
N.W.L.R. (Part 6) 137.
Counsel submitted that in interpreting Order 48 Rule 5(1),
h
this Court should not only consider the purport of the rule,
but also give the wordings of the rule their ordinary and
natural meaning. He contended that the emphasis of the rule
was on the word “hear”, the purport of this being to ensure
i that none of the parties to a suit was prejudiced in presenting
its case by having the matter heard during a period when the
courts and lawyers were supposed to be on vacation. He
argued that to ascribe a different interpretation to the rule
j would lead to absurdity and inconsistency with Order 48
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
284 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Rule 4 whereas it is a fundamental principle of interpretation a

that a provision of a statute, or document, should not be
construed in isolation of other provisions contained in the
statute or document, they must all be read together to pro- b
duce a harmonious result, Counsel argued. He relied on
Akaighe v. Idama (1964) 1 All N.L.R. 322.
Learned Counsel also contended that failure on the part of
the appellant to act timeously when he knew that the judg- c
ment was to be delivered during the Christmas vacation was
prejudicial to her case. Contending that equity did not aid
the indolent, Counsel submitted that the appellant’s hands
were not only unclean but they were tardy. Therefore the d
attempt to nullify the judgment ought to be frustrated and
refused, Counsel submitted.
Counsel further argued that what was done during the va-
cation was not hearing the case but rather only the judgment e
was delivered. He finally urged the court to dismiss the
appeal as it lacked merit.
Learned Counsel for the appellant, in reply, submitted that
the principle in Royal Bank of Canada v. Regem (supra) f
cited by Counsel for the respondent did not apply. To
learned Counsel, the principle applied only in so far as plain-
tiff’s claim is in fact for money “had and received”. This
simpliciter means the sum actually had and received and is g
limited to cases where repayment is enforceable in law. He
cited A.C.B. v. Oladipo (1957) 13 W.A.C.A. 285.
On the presumption under section 4, learned Counsel sub-
h
mitted that the law did not offer a discharge from the re-
quirements of that section. Section 2 did not offer a
discharge from the requirements of section 4; rather section
2 is the general definition section of the law and it merely
defines who a moneylender is, Counsel contended. There- i
fore it was incumbent on the respondent at the trial Court to
rebut the presumption, Counsel submitted. He relied on
Orojo Nigeria Commercial Law Practice Volume 1 at page
856. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 285

a Contending that there is a clear admission on record by the

respondent through her Counsel, that the business of the
respondent is “the lending of money to customers”, Counsel
b referred to what he called “further better records at para-
graph 21”.
On the issue of interest, learned Counsel submitted that
section 15(1) of the law applies to all classes of interests and
c loans however calculated. He called in aid section 18(2) of
the Law.
Learned Counsel submitted further that the rule in Smith v.
Selwyn (supra) is not applicable in the circumstances of this
d case because the matter is not a felony but a misdemeanour.
Assuming (without conceding) that the offence contrary to
section 15(1) of the Moneylenders Law amounts to a felony,
learned Counsel described the rule in Smith v. Selwyn as
e antiquated as it has since been abrogated in England by a
1967 legislation. While relying on Oyewale v. Okoli (1974)
N.N.L.R. 40, learned Counsel did not assist the court on the
1967 legislation which abrogated the English common law
f principle enunciated in Smith v. Selwyn.
Learned Counsel submitted that the hearing of a case in-
cludes the delivery of judgment. He relied on Anyaoke v. Adi
(1986) 4 S.C. 213; (1986) 3 N.W.L.R. (Part 31) 731 and
g Ezenwa v. Mazeli (1955) 15 W.A.C.A. 67. He finally urged
the court to allow the appeal.
Before I go into the merits of this appeal, it is necessary to
take a little time off to deal with the way the briefs were
h written. This Court, and indeed the Supreme Court, have,
time without number, expanded and expatiated on the basic
principles for writing briefs. While most Counsel have over
the relatively short period of introducing brief writing in our
i practice and procedures, mastered the art of writing briefs, a
few others are still in the learning process.
Both briefs have a common characteristic, and it is the lack
of co-ordination and symmetrisation of thought. Let me
j make myself clearer. From the facts, the case falls into two
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
286 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

fairly distinct and neat compartments. The first compartment a

is the applicability or otherwise of the Moneylenders Law of
Lagos State. This involves the interpretation of the provi-
sions of the law, particularly sections 2 and 4 thereof. Re- b
lated issues are those of illegality and interest on the loan.
That appears to me as the first compartment. The second
compartment is the delivery of the judgment during the
Christmas vacation. This involves the interpretation of the c
rules of court and all that.
I expected both Counsel to develop their arguments with
the above in mind. They did not. They both mixed the dif-
ferent compartments indiscriminately, thus creating so much d
confusion in the mind of the brief reader that I am. Both
Counsel randomly moved from one issue to another at will,
and with little or no regard for some flow of legal thought
and even traditional essay practice. This is not the best ap- e
proach.
Although there are no hard and fast rules governing the
writing of briefs in terms of style (as style is a personal
matter of the writer), there are established procedures of f
arranging briefs. Brief writing is different from writing a
composition in a typical classroom setting. Brief writing is a
technical venture which requires skill. It also requires pa-
tience. It is a function which needs great expertise, an exper- g
tise which can only be acquired by a very serious application
of a highly organised professional mind.
Learned Counsel for the respondent would seem to have
urged this Court to invoke the rule in Smith v. Selwyn. The h
rule could be stated thus:–
“An action for damages based upon an offence the defendant
committed against the plaintiff is not maintainable so long as the
defendant has not been prosecuted or a reasonable excuse shown
for his having not been prosecuted and the proper course for the i
court to adopt in such a case is to stay further proceedings in the
action until the defendant has been prosecuted.”
The above is in summary the rule, the so-called rule which
has given so much problem to our criminal justice system. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 287

a The question is whether the rule really applies in Nigeria.

Counsel for the respondent says it applies. Counsel for the
appellant says it does not apply in the circumstances of the
b case. None of them says that it does not apply at all under
Nigerian law.
The courts generally think the rule applies. Thus, in Haco
Ltd v. Udeh (1959) N.N.L.R. 61 and Ibekwe v. Pearce
c (1960) N.N.L.R. 12 the rule was applied. In Tiamiyu and
others v. Ashiru (1955) 2 N.R.N.L.R. 42; Nsude v. Anigbo
(1958) NRLNR 96 and A.C.B. v. Ojukwu (1968) A.L.R.
Comm. 199, the courts distinguished the cases and circum-
d stances of the cases from those of Smith v. Selwyn. In Ogu-
che v. Iliyasu and others (1971) 2 All N.L.R. 333, it was
held that the rule applies only when the plaintiff is the in-
formant, not when he is a suspect.
e It appears that the decisions to the effect that the rule ap-
plies in Nigerian Law were made per incuriam. It is my
view that the rule is not applicable in Nigeria in view of very
clear two local statutory provisions. Section 5 of the Crimi-
f nal Code Act, 1958 is one. Section 8 of the Interpretation
Act, 1964 is another. Let me state verbatim ad literatim the
provisions of the two statutes: First, section 5. The section
provides that the Criminal Code:–
g “shall not affect any right of action which any person would have
had against another if the act had not been passed.”
Second, section 8. The section provides thus:–
“An enactment shall not be construed as preventing the recovery
h of damages in respect of injury attributable to any act by reason
only of the fact that the enactment provides for a penalty, forfei-
ture or punishment in respect of the Act.”
In the light of the above statutory provisions, it is not correct
i to contend, in the way learned Counsel for the respondent
contended, that the rule applied in the case. It does not.
Apart from the clear position of our law, it does not even
seem to be a sensible thing to stop a plaintiff from instituting
j an action merely because the criminal action on the same
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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288 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

matter has not been prosecuted. Certainly, a man who is a

aggrieved should have nothing to do with a criminal matter
before instituting a civil action. The criminal matter is the
concern of the State, so to say, while the civil matter is the b
concern of the aggrieved individual.
There is yet another aspect of looking at the rule in Smith
v. Selwyn. It would appear that the Rule itself is now an
anachronism, even in England, since the enactment of the c
Criminal Justice Act of 1967, an Act which put to final rest
the erstwhile distinction between felony and misdemeanour.
It does not therefore seem that the rule is still applicable in
England. Why in Nigeria, then? d
It should have been a different matter if there was an ena-
bling statute. There is none. If anything, there is an une-
nabling statute, if I may say so. Or better still, there are
unenabling statutes. The first is the Criminal Code Act. The e
second is the Interpretation Act. I had earlier mentioned
them.
I now come to the heart of the matter, and it is the con-
struction of the Moneylenders Law of Lagos State. The law f
is the cynosure of the entire appeal. Apart from the second
aspect relating to the delivery of the judgment during the
Christmas vacation of the court, the appeal hinges on the
applicability or otherwise of the Moneylenders Law. g
Before I take the specific relevant provisions of the law, let
me take some few random but relevant principles of statu-
tory interpretation. And so once again we have the problem
h
of statutory interpretation. It vexes us daily. Not only us, but
other courts. The task of construing the provisions of any
statute is like fitting a jigsaw puzzle. The pieces are most
times jumbled up, but the courts face squarely their interpre-
tative jurisdiction. In interpreting a statute, the meaning and i
intention of the legislation must be collected from the plain
and unambiguous expressions used therein rather than from
any notions which may be entertained as to what is just or
expedient (see Ahmed v. Kassim (1958) S.C.N.L.R. 28, j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 289

a (1958) 3 F.S.C. 51). The object of all statutory interpretation

is to discover the intention of the law makers which is de-
ducible from the language used. Once the meaning is clear,
b the courts are to give effect to it. The courts are not to defeat
the plain meaning of a statute by an introduction of their
own words, as was done in the case of Okumagba v. Egbe
(1965) All N.L.R. 62. That will be tantamount to a process
c of judicial legislation (see Ifezue v. Mbadugba (1984) 1
S.C.N.L.R. 427). The literal construction must be of the
statute as a whole (see Onashile v. Idowu (1961) 2
S.C.N.L.R. 53; (1961) 1 All N.L.R. 313; Adejumo v. The
Military Governor of Lagos State (1972) 3 S.C. 45; Lawal v.
d
G.B. Ollivant (1972) 3 S.C. 124).
I will be very much guided by the above random principles
in the interpretation of the relevant provisions of the Money-
e lenders Law Cap 85 Laws of Lagos State. Section 2 of the
law is the definition or interpretation clause. It defines inter
alia who a moneylender is. The first leg of the definition is
inclusive, not exclusive. For our purpose, it is the second leg
f which is material. It provides for four specific instances
when a person is not a moneylender within the meaning of
the law. I think the relevant provision is (c). It provides
thus:–
g “Any person bona fide carrying on the business of banking or in-
surance or bona fide carrying on any business, not having for its
primary object the lending of money, in the course of which and
for the purposes whereof he lends money.”
As it is, (c) provides for three categories of persons who
h
cannot be called or designated as moneylenders within the
meaning of the law. First is a banker. Second is an insurer
and the third category is the omnibus one. It is the person
who does not have for its primary object lending of money.
i The word “primary” contextually means main, major, chief
or the highest in rank or importance. By the provisions, a
person may not necessarily qualify as a moneylender al-
though he is involved in money lending in so far as he is
j able to show that money lending is not his primary object. In
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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290 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

other words, once the person is able to show that money a

lending is a subsidiary or secondary object, or merely ancil-
lary, he is not caught by the provisions.
For our purpose, section 2 as it stands is meaningless b
unless read along with section 4. Section 4 provides:–
“Save as excepted in paragraphs (a), (b), (c) and (d) of the defini-
tion of moneylender in section 2 any person who lends money on
interest or who lends a sum of money in consideration of a larger c
sum being repaid shall be presumed to be moneylender until the
contrary be proved.”
And so we come to the hilt of the matter, section 4 raises a
presumption of who a moneylender is. The presumption is
d
not watertight. The presumption is rebuttable and it can be
rebutted. There is therefore nothing sacrosanct in section 4.
As it is, the burden of proving paragraphs (a), (b), (c) and
(d) of section 2 lies on the person alleging the exceptions.
And that person is the respondent. That is borne out by our e
elementary evidential rules of burden of proof. He who
asserts must prove the truth of his assertion.
Now, I move to the evidence. In paragraph 1 of the state-
ment of claim, the respondent avers as follows:– f
“The plaintiff is a limited liability company incorporated under the
Companies Act, 1968 and carrying on business as an investment
company at 21/25 Broad Street, Lagos.”
By the proposed statement of defence, which was exhibited g
to the affidavit dated 8th January, 1988 of Simeon
Nwankoro Okoro, the managing director of the appellant,
the above paragraph of the statement of claim was admitted.
Paragraph 1 of the proposed statement of defence reads:– h
“The 2nd defendant admits all the averment contained in para-
graph 1.”
What further evidence is really required to prove the primary
investment status of the respondent? Why the furore on the i
part of the appellant on the face of the admission above? In
the law, an admission against interest is valuable and a court
of law is entitled to make use of it. An admission basically
puts an end to proof. This is because, by the admission, the j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 291

a parties no more join issues on the matter. Since proof pre-

supposes a dispute and since admissions drowns the element
of dispute, proof becomes superfluous.
b This Court, and indeed any other court for that matter, is
entitled to make use of the proposed statement of defence. It
is a document in the court’s file which was used by the ap-
pellant. It does not matter whether at the time the judgment
c was delivered the document was not available. And so, I
have made use of the document.
That is not the end of the matter. I should still move further
and this time to the writ of summons. What does it say?
d There are two reliefs. The first one is for the sum of
N140,000 being “money had and received by the first de-
fendant from the plaintiff to the use of the first defendant
and guaranteed by the second to fourth defendants subject
e however to the claim being limited to the sum of N120,000
with respect to the second defendant”. The second relief is
for an order of the interlocutory injunction.
And so I ask the question: where is the claim for breach of
f a money-lending agreement? There is a world of difference
between a claim of money had and received and one on
breach of an agreement on money lending. Learned Counsel
for the appellant made heavy weather out from a reasonably
g fine cloud on the issue of interest. As it is, the respondent
claimed an interest of 5% on the amount. It is certainly not
my understanding of the law that once a plaintiff claims
interest on an amount, the transaction automatically comes
h within the ambit or purview of the Moneylenders Law. That
is certainly new learning to me and I will refuse to learn it.
There is no such provision either in the Moneylenders Law
or in any other law. And here learned Counsel for the appel-
i lant was not helpful.
Learned Counsel however referred us to what he calls “fur-
ther better records at paragraph 21” in his reply brief.
Frankly, I do not know what he really means. I have in obe-
j dience checked through the case file and I cannot place my
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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292 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

hands on such a document. I have seen a document bearing a

the name of “appellant in support of Further and Better
Records of Appeal”. It is a document of about 32 pages. If
that is the document he has in mind, I must say that it is not b
arranged in paragraphs as such. It is rather arranged in
pages.

Counsel owes a duty to his client and the court to make

accurate and specific references to a document he relies c
upon in vindication of the case of his client. He has to be
exact and precise. In a case where the documentation is
enormous, Counsel will be helpful to the court to clearly and
specifically found upon the document he is relying upon. d
Where this is not done, the court will be left to float in an
ocean and it can never come ashore with the document in-
tact. That will be bad, not for the court, but for the client.
e
Let me pause here to take the related issue of illegality
raised by Counsel for the appellant in this appeal. He did not
raise it at the trial. He expected the learned trial Judge to
raise it suo motu. He said so in so many words in his brief. f
He cited a few cases to support his position. I agree entirely
with him that a trial Judge is entitled to raise the issue of
illegality suo motu. This, however, depends upon the cir-
cumstances of the case. It is not a rule of the thumb. It is not g
a rule of the hand either. He can do so only when the issue is
so obvious, so clear and so unequivocal from the pleadings
before him. The adversary system that we operate in our
legal system will not allow a trial Judge to raise the issue of
h
illegality suo motu on mere speculative or conjectural plead-
ings. Once a trial Judge does that, he exposes himself to an
appellate attack as he has no jurisdiction to raise issues suo
motu by the operation of his whims and caprices. In Chief
Sodipo v. Lemminekainem Oy and another (1986) 1 S.C. i
197; (1985) 2 N.W.L.R. (Part 8) 547, a case cited by the
learned Counsel for the appellant, the Supreme Court held
that the trial Judge was justified in not raising the issue of
illegality suo motu. j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 293

a And this is more so because of the additional requirement

of the law that illegality of contract, as a defence, should, in
the first place, be pleaded. Order 16 Rule 11 of the High
b Court of Lagos (Civil Procedure) Rules, 1972 is clear on this
(see also Nasr v. Berini (Nig) Bank Ltd (1968) 1 All N.L.R.
274; George v. Dominion F.M. (1963) 1 S.C.N.L.R. 242,
(1963) 1 All N.L.R. 71; Paul v. George (1959) S.C.N.L.R.
c 510; (1959) 4 F.S.C. 198; Abcos (Nig.) Ltd v. Kango Wolf
Power Tools Ltd (1987) 4 N.W.L.R. (Part 67) 894).
Now, what is the evidence relied upon by learned Counsel
for the appellant on the issue of illegality? There is also a
d related question. I might as well pose it. If there is any such
evidence, was illegality ex facie manifested in the statement
of claim? Counsel relied on a 20% interest charge and re-
lated that to the provisions of the Moneylenders Law. I do
e not see how illegality applies here.
And that takes me to the larger issue whether the Money-
lenders Law is applicable to this case. I have taken some
time to analyse the relevant provisions of the law. It remains
f now to state the conclusion of my analysis and it is that the
Moneylenders Law, contrary to the contention of the learned
Counsel for the appellant, is not applicable to the case and I
so hold. Since the law is inapplicable, then Order 3 Rule 8 of
g the High Court of Lagos (Civil Procedure) Rules, 1972
relied upon by learned Counsel, is also inapplicable. In other
words, there was no breach of the rule by the respondent in
the commencement of the action. That takes me to the end
h of the first basic and main issue.
I now take the second one. It is on the issue of delivering
judgment during the Christmas vacation. The first issue to
be the considered is whether a judgment is part of the hear-
i ing of a case. Learned Counsel for the appellant submitted
that it is. Learned Counsel for the respondent submitted that
is not. If the word is given a restrictive and restricted inter-
pretation, it will certainly exclude the delivery of a judg-
j ment. This is when the word is only used in the context of
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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294 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

the parties giving evidence followed by submission of a

Counsel. That will technically exclude the delivery of judg-
ment.
That is a rather narrow and probably naïve way of looking b
at the otherwise generic expression in the litigation process.
A larger way of looking at the expression in our context is
whether a matter can be said to be completed without the
delivery of judgment. In other words, can a litigation come c
to an end without the Judge delivering the judgment. The
answer is simple and straightforward. It is that there cannot
be an end to the litigation without the judgment. Although
the point is conceded that there are instances when a ruling d
terminates a matter, that is not the issue before us. I will
therefore not pursue it.
It is common place that a hearing of a case extends to and
includes the delivery of judgment. It cannot be otherwise e
(see Anyaoke v. Adi (1986) 3 N.W.L.R. (Part 31) 731;
(1985) 4 S.C. 213). In the circumstances, I am of the view
that the delivery of the judgment on 29th December, 1987
violated Order 48 Rule 5 of the High Court of Lagos (Civil f
Procedure) Rules, 1972.
What then is the effect of the violation? Learned Counsel
for the appellant says the judgment is a nullity. Should it be
so? If so, why? The courts have over the years drawn a di- g
chotomy between incurable and curable non-compliance
with Rules of Court. The courts, in the exercise of their
discretionary powers, in the light of the circumstances of the
case, decide whether non-compliance with the Rules of h
Court could be treated as mere irregularity, which could be
cured.
The Supreme Court and this Court have said it time with-
out number that the interest of the courts of the land should i
be to do substantial justice and not technical justice (see
Willoughby v. International Merchant Bank (Nig.) Ltd
(1987) 1 N.W.L.R. (Part 48) 105; Obodo v. Olomu and
another (1987) 3 N.W.L.R. (Part 59) 111; Nneji and others j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 295

a v. Chief Chukwu and others (1988) 3 N.W.L.R. (Part 81)

184; Edun v. Odan Community (1980) 8–11 S.C. 103).
Although rules of the court are meant to regulate the con-
b duct of a case, they cannot be masters of the court. It is the
contrary and it is that the court is the master of its own rules.
And no servant is bigger than the master. That is not a hu-
man conduct.
c The function of the court is to use the armoury of its rules
to do justice in the matter. The armoury, for a change, can-
not this time around, be weapons for war but for justice
through peace and to the egalitarian advantage of the parties.
d Once rules become an affront and hurdle to or wedge against
justice, the court is entitled to meander its way through the
rules in search of justice. Once rules involve themselves in
direct confrontation with justice, once rules directly antago-
e nise the well-settled principles of justice, the rules must
invariably succumb and give way to justice par excellence.
The court is not entitled to stand on arid legalism by doing
“justice” to the rules and injustice to the matter before it. By
f that approach, the court has done “justice” in inverted co-
mas. The court has reversed justice and has done injustice.
While a court of law should follow his own rules, let it
take the earliest opportunity to retrieve its steps when it is in
g the interest of justice to do so. It should not allow itself to
fall headlong into a ditch in the course of following its rules.
It can never remain afloat or alive to do justice. That will be
serious. Litigants will not be happy. The courts themselves
h will not be happy too.
I have pontificated enough. Now I come to the problem on
hand, and I pose a question: What injustice did the appellant
suffer by the delivery of judgment during the vacation pe-
i riod? To be precise, what injustice did the appellant suffer
by the delivery of the judgment on 29th December, 1987,
instead of on 2nd January, 1988? What is the essence of
judgment vis-à-vis the role or roles of the parties in the
j judgment delivery process? I do not think I have made
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
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296 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

myself clear. Let me pose an ancillary question: What role a

does any of the parties play when a judgment is being deliv-
ered? I think I now sound clearer.
Parties and or their Counsel sit in court and listen to the b
judgment being delivered. They do not play any role beyond
listening and at times taking down random notes in the
course of the delivery of the judgment. Some do not take
notes. They just listen and leave the court at the end of the c
judgment, with the usual cliché “as the court pleases”, even
when the pleasure of the court is not the pleasure of the
party who lost the case.
In my view, since the appellant, even if in court, was not to d
take any legal steps to vindicate his legal “right”, if any, he
has not suffered any injustice. The best she should have
done was to apply to arrest the judgment. In my opinion,
failure to do so is not tantamount to a miscarriage of justice, e
in the light of the circumstances of and level of the non-
compliance with the rules. The appellant merely raised and
fomented a heavy storm inside a very small tea cup. Beyond
the turbulence of the storm there is really nothing. Perhaps f
the position should have been different if the matter was at
the stage of physically taking evidence or at the point of
address (see generally Obodo v. Olomu (supra); Eseighe v.
Agholor and another (1990) 7 N.W.L.R. (Part 161) 234). g
The above apart, the rules on the issue are not sacrosanct
or final. I say so because the rules allow two instances where
judgment could be delivered during vacation. This means
that it is not the intention of the rule makers to securely and h
stringently close the door of the court against litigation dur-
ing vacations. Part of the door is open to litigants. In my
view, no injustice will be done if part of the same door is
open to accommodate the type of situation in this matter. i
An injustice must cause a party some disadvantage in the
trial process. An injustice must result in some adversity or
unfairness in the trial process. While a mere withholding of
a right of a person may be injustice in general parlance, in j
 [1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
Veritas Insurance Co Limited v. Cititrust Investments Limited 297

a my view, in law, a mere withholding of a right which is

dormant cannot amount to an injustice. And here, it is my
view that the right to be present during the delivery of judg-
b ment is nothing more than a dormant right, in the sense that
beyond listening to the judgment, no other consequential
right accrues to the party. After all, either of the parties is
constitutionally entitled to a copy of the judgment after
c delivery.
The long and short of it is that this Court cannot find its
way clear in allowing the appeal on that ground.
Let me take one last point suo motu. Since the point does
d not affect our decision one way or the other, I can take it. It
is in respect of the reply brief of the appellant. A reply brief,
like a reply to a statement of defence, follows the issues
raised in the respondent’s brief. It is unlike a private corre-
e spondence where the replier takes the liberty to touch other
issues, and let the only limitation be the sky. A party reply-
ing to a respondent’s brief has no such liberty to go to town
beyond the trip of the respondent. He cannot. Otherwise, it is
f not a reply brief but something else.
In law, a reply brief must not introduce fresh points. It
must be confined to the new point or points raised in the
respondent’s brief, if any and no more. In other words, a
g reply brief must be a reply and nothing else and nothing
more.
Counsel, in a number of times, are tempted to use the fo-
rum of the reply brief to introduce “green” areas in the sense
h of newness or innovation. I see in Counsel for the appellant
such a temptation. The issue of paragraph 21 of what Coun-
sel called further better records is one. There are a few oth-
ers. He cannot raise such issues in his reply brief. He ought
i to have raised them in his main brief. The opportunity is lost
to him and he cannot in law revive it without much ado.
Having said that, I come to the last and crucial aspect.
It is the dismissal of the appeal. Let me formally do that. In
j view of the analysis of the legal position, this appeal is
[1990 – 1993] 5 N.B.L.R. (COURT OF APPEAL, LAGOS DIVISION)
Tobi JCA
298 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

unmeritorious and it is hereby dismissed. I award N300 a

costs in favour of the respondent.
SULU-GAMBARI JCA: I agree.
b
KALGO JCA: I agree with the reasoning and conclusions
reached in the judgment just delivered by my learned
brother, Tobi JCA. I have nothing to add. I abide by the
consequential orders he has made therein including the or-
ders as to costs. c
Appeal dismissed.
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 299

a
Obimiami Brick and Stone (Nig.) Limited v. African
Continental Bank Limited
b SUPREME COURT OF NIGERIA
OLATAWURA, BABALAKIN, KAWU, OMO, WALI JJSC
Date of Judgment: 27 MARCH 1992 Suit No. SC.: 186/1990

c Banking – Letter of credit – Failure of bank to open –

Breach of contract – Measure of damages
Facts
d The plaintiff sued the defendants, now respondent, in this
appeal for the sum of N13,000,000 for special and general
damages. The case of the appellant as presented in the trial
court was that the plaintiff/appellant was a manufacturing
e company. It manufactured cast stone bricks in various col-
ours for sale to the public. To assist in its business, it applied
for and obtained an import licence which was valid for for-
eign exchange. The import licence was admitted and marked
f exhibit F. It was as a result of this that the plaintiff/appellant
approached the defendant/respondent for a loan to import
the goods. The application for the loan was granted. Having
obtained the approval, the managing director of the plain-
g tiff/appellant by name Victor Obiekwe (PW3) travelled to
Western Germany and made arrangements with one firm,
KLOSA and STAAS, for the shipment of the goods to Nige-
ria and the foreign company “agreed to ship the goods and
also give credit due through Deutsche Bank”. The bank was
h
also in Western Germany. The managing director of the
plaintiff/appellant came home and got in touch with the
defendant/respondent to open a letter of credit in favour of
Deutsche Bank. The defendant/respondent gave certain
i conditions to be accepted by the plaintiff/appellant. These
conditions were clearly set out in exhibit G. The plaintiff
accepted all the conditions and the managing director sub-
mitted all the documents to the Enugu Branch office of the
j defendant. These documents were taken to Lagos by one
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

300 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Njemanze, an official of the defendant. The managing direc- a

tor accompanied him to Lagos on 24th September, 1986.
Their documents were duly delivered in Lagos Headquar-
ters of the defendant. It was also one Mr Okwonkwo, a staff b
member of the defendant, who prepared the letter of credit
which was eventually handed to one Mr Akinola, Assistant
Controller of the Foreign Bureau Department.
As at 1p.m. on 25th September, 1986 everything necessary c
to be done concerning the second-tier foreign exchange
market popularly called SFEM had been done because
SFEM effective date of commencement was 29th Septem-
ber, 1986. d
Before going into the evidence led in support of the claims,
it was necessary to mention at this early stage of this judg-
ment, that the sole purpose of this exercise was to enable the
e
plaintiff take advantage of the first-tier foreign exchange
market which was cheaper than SFEM. In order to take
advantage of this provision any body who purchased foreign
exchange must before the commencement date of the SFEM
which was 29th September, 1986 comply with section 15(2) f
of the Second-Tier Foreign Exchange Market Decree, 1986
which as said earlier, came into effect on 29th September,
1986.
g
The managing director of the plaintiff asked for a copy of
the Telex allegedly sent to Western Germany. This was on
25th September, 1986 at about 2.30p.m. He said Mr Okocha
told him to come back the following day to collect the copy.
h
On 26th September, 1986, he went to him but he was not
given a copy, the reason was that the defendant did not find
the telex register. It was 3p.m. on that day, i.e. 26th Septem-
ber, 1986, that he was informed the message was in fact not
sent. Thereafter an employee of the defendant, one Miss i
Idowu, was instructed to write another message. This was
done, but the telex message was taken to the defendant’s
telex room at 4p.m. This time was vital as would be seen
later. j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 301

a According to the managing director, he had lost the chance

of benefitting under the first-tier market. He was then ad-
vised by the defendant to bid under the SFEM with a prom-
b ise to reimburse him for the loss under the first-tier market.
He agreed and therefore succeeded under bid 12. The man-
aging director gave evidence of loss as itemised in the
amended statement of claim. Two witnesses were therefore
c called by the plaintiff to show that no telex message was
ever sent to Western Germany let alone being received. The
defendant did not put up appearance in court after the first
and second PWs gave evidence. In fact, they were com-
pletely absent as at the time PW3 concluded his evidence-in-
d chief. Consequently PW3 was not cross-examined. At the
end of the case, the learned Counsel, Mr Anyamene, S.A.N.,
addressed the court. Judgment was delivered by Eze-Ozobu
J (as he then was) in favour of the plaintiff for the sum of
e N10,827,305.25k, with costs assessed at N4,000.
The defendant appealed to the Court of Appeal, Enugu Di-
vision. In a unanimous decision, the appeal was allowed.
The judgment of the High Court was set aside. This has now
f led to the appeal in the Supreme Court.

Held –
Where a banker is found liable for breach of contract to open
g a confirmed and irrevocable letter of credit, the measure of
damages is that which it could reasonably have been fore-
seen would flow from such a breach. In the instant case, the
defendant was aware that failure by it to confirm the letter of
h credit with Deutsche Bank would force the plaintiff to resort
to the second-tier market which was costlier, thus plaintiff
suffered a loss in terms of Naira which was proved by the
plaintiff.
i Appeal allowed in part.
Cases referred to in the judgment
Nigerian
j Ajide v. Kelani (1985) 3 N.W.L.R. (Part 12) 248
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)

302 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Akinsanya v. U.B.A. Ltd (1986) 4 N.W.L.R. (Part 35) 273 a

Chukwu v. Nneji (1990) 6 N.W.L.R. (Part 156) 363
Ipadeola v. Oshowole (1987) 3 N.W.L.R. (Part 59) 18
b
Obi v. Owolabi (1990) 5 N.W.L.R. (Part 153) 702
Sommer v. F.H.A. (1992) 1 N.W.L.R. (Part 219) 548
U.B.A. Ltd v. Achoru (1990) 6 N.W.L.R. (Part 156) 254
c
Foreign
Perestrello E. Companhia Limitada v. United Paint Co Ltd
(1969) 1 W.L.R. 570
d
Counsel
For the appellant: Anyamene, S.A.N. (with him Udogu
(Mrs))
For the respondent: Williams, S.A.N. (with him Williams e
and Bashorun (Miss))

Judgment
f
OLATAWURA JSC: (Delivering the lead judgment) The
appellant issued a writ in the High Court of Anambra State
of Nigeria (now Enugu State), Enugu Judicial Division
against the respondent and claimed as follows:– g
“1. The defendant is a limited liability company whose regis-
tered office is situated at 148 Broad Street, Lagos, and car-
ries on commercial banking business in various places
including 2 Ogui Road, Enugu at which the plaintiff, a lim-
ited liability company maintains a current account and at h
which some of the transactions relating to the subject matter
of this action, were carried out.
2. The plaintiff has suffered damages as a result of negligence
of the defendant or its employees in the course of and i
within the scope of their employment as follows:
(a) In May, 1986, the plaintiff obtained an import license
valid for foreign exchange to import goods worth
N1,202,830 from Klosa and Staas, Western Germany.
The defendant for valuable consideration, undertook to j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 303

a establish a confirmed and irrevocable letter of credit for

the import, but negligently failed to do so before the 29th
of September, 1986, and thus subjected the import to
second tier instead of first tier foreign exchange market
b transaction which resulted in enormous loss to the plain-
tiff.
PARTICULARS OF NEGLIGENCE
Fully aware, as per the exporter’s letter dated 28th August,
c 1986, that Deutsche Bank in Frankfurt was to confirm the
letter of credit, the defendant neglected to notify the said
bank of the issue of the letters of credit and even when a
telex message was misplaced in the defendant’s office and
d was not sent out until a later date when it had become stale
for purposes of Decree No. 28 (sic) of 1986, section
15(2)(a).
(b) In November, 1986, the defendant negligently excluded
the plaintiff benefitting from the proceeds of BID 10 of
e 25th November, 1986 and so the plaintiff’s money of
N559,290 paid at Enugu for which Enugu issued a draft
No. DX/700594 was unutilised, whilst the bank interest
kept accumulating.
f PARTICULARS OF NEGLIGENCE
Though the draft was in possession of the bank, it was
misplaced in the bank’s office, only to be discovered after
the transaction, to the plaintiff’s detriment.
g (c) On the 11th December, 1986 the plaintiff was successful
in the SFEM BID 12 but the defendant negligently failed
to open the letters of credit till 24th of February, 1987,
thus causing unnecessary delay in the arrival of goods
with consequential increase in bank interests etc.
h
PARTICULARS OF NEGLIGENCE
Defendant overlooked to handle the transaction promptly as
it should have been done in ordinary course of business.
i (d) The plaintiff’s goods arrived Nigerian Port on the 12th
of May, 1987 but the defendant negligently failed to
cause necessary steps to be taken for the clearance of the
goods till the 24th of September, 1987 when they ap-
proved clearance thus subjecting the plaintiff to payment
j of heavy demurrage charges, bank interest, etc.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
304 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

PARTICULARS OF NEGLIGENCE a
(e) Fully aware since 12th May, 1987, that the imported
goods were awaiting clearance subject to certain pay-
ments, and fully aware of financial implication of de-
b
layed payment of the clearance charges, the defendants,
contrary to their undertaking, neglected to release money
for payment of the charges until the 24th of September,
1987.
3. The plaintiff has suffered heavy loss and damages as a c
result of the negligence averred above. Wherefore the plain-
tiff claims from the defendant the sum of N13,000,000
(Thirteen Million Naira) special and general damages (N.B.
full particulars of the damages will be pleaded in the state-
ment of claim) from the defendant.” d
Pleadings were ordered, filed and delivered. Both parties
later amended their pleadings. As a result of the issues raised
by both parties in their briefs of argument, I will refer to the
e
amended pleadings later.
The case of the appellant as presented in the trial court was
that the plaintiff/appellant is a manufacturing company. It
manufactures cast stone bricks in various colours for sale to f
the public. To assist in its business, it applied for and ob-
tained an import licence which was valid for foreign ex-
change. The import licence was admitted and marked exhibit
F. It was as a result of this that the plaintiff/appellant ap- g
proached the defendant/respondent for a loan to import the
goods. The application for the loan was granted. Having
obtained the approval, the managing director of the plain-
tiff/appellant, by name Victor Obiekwe (PW3), travelled to
h
West Germany and made arrangements with one firm,
KLOSA and STAAS, for the shipment of the goods to Nige-
ria and the foreign company “agreed to ship the goods and
also give credit due through Deutsche Bank”. The bank is
also in West Germany. The managing director of the plain- i
tiff/appellant came home and got in touch with the defen-
dant/respondent to open a letter of credit in favour of
Deutsche Bank. The defendant/respondent gave certain
conditions to be accepted by the plaintiff/appellant. These j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 305

a conditions were clearly set out in exhibit G. The plaintiff

accepted all the conditions and the managing director sub-
mitted all the documents to the Enugu Branch office of the
b defendant. These documents were taken to Lagos by one
Njemanze, an official of the defendant. The managing direc-
tor accompanied him to Lagos on 24th September, 1986.
Their documents were duly delivered in Lagos Headquar-
c ters of the defendant. It was also one Mr Okwonkwo a staff
member of the defendant who prepared the letter of credit
which was eventually handed to one Mr Akinola, Assistant
Controller of the Foreign Bureau Department.
d As at 1p.m. on 25th September, 1986 everything necessary
to be done concerning the second-tier foreign exchange
market, popularly called SFEM, had been done because the
effective date of commencement of SFEM was 29th Sep-
e tember, 1986.
Before going into the evidence led in support of the claims,
it is necessary to mention at this early stage of this judgment
that the sole purpose of this exercise was to enable the plain-
f tiff to take advantage of the first-tier foreign exchange mar-
ket which was cheaper than SFEM. In order to take
advantage of this provision anybody who purchased foreign
exchange before the commencement date of the SFEM,
g which was 29th September, 1986, had to comply with sec-
tion 15(2) of the Second-tier Foreign Exchange Market
Decree, which as said earlier, came into effect on 29th Sep-
tember, 1986. There was argument about how the plaintiff
h could have known of the commencement date of this De-
cree. I will come to this when the submission made before
us are considered.
The managing director of the plaintiff asked for a copy of
i the telex allegedly sent to West Germany. This was on 25th
September, 1986 at about 2.30p.m. He said Mr Okocha told
him to come back the following day to collect the copy. On
26th September, 1986, he went to him but he was not given
j a copy, the reason was that the defendant did not find the
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
306 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

telex register. It was at 3p.m. on that day, i.e. 26th Septem- a

ber, 1986, that he was informed the message was in fact not
sent. Thereafter an employee of the defendant, one Miss
Idowu, was instructed to write another message. This was b
done, but the telex message was taken to the defendant’s
telex room at 4p.m. This time is vital as will be seen later.
According to the managing director, he had lost the chance
of benefiting under the first-tier market. He was then ad- c
vised by the defendant to bid under the SFEM with a prom-
ise to reimburse him for the loss under the first-tier market.
He agreed and therefore succeeded under bid 12. The man-
aging director gave evidence of loss as itemised in the d
amended statement of claim. Two witnesses were called by
the plaintiff to show that no telex message was ever sent to
West Germany let alone being received. The defendant did
not put up appearance in court after the first and second PWs e
gave evidence. In fact, they were completely absent as at the
time PW3 concluded his evidence-in-chief. Consequently
PW3 was not cross-examined. At the end of the case, the
learned Counsel, Mr Anyamene, S.A.N., addressed the f
Court. Judgment was delivered by Eze-Ozobu J (as he then
was) in favour of the plaintiff for the sum of
N10,827,305.25k, with costs assessed at N4,000.
The defendant appealed to the Court of Appeal, Enugu Di- g
vision. In a unanimous decision, the appeal was allowed.
The judgment of the High Court was set aside. This has now
led to the appeal in this Court.
h
It is necessary to set out in detail the pleadings more so
when no evidence was led by the defendant in the court of
trial. The plaintiff in its amended statement of claim averred
in paragraphs 1–27 as follows:–
i
“1. The plaintiff is a limited liability company having its head
office at No. 1, Rustique Mews (off Rehabilitation Road)
behind Enugu Airport Emene, Enugu and carries on com-
mercial business of moulding and manufacturing of multi-
coloured cast stone bricks. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 307

a 2. The defendant is a limited liability company whose regis-

tered office is situate at No. 106/108 Broad Street, Lagos
and carries on commercial banking business at various
places including No. 2 Ogui Road, Enugu at which the
b plaintiff maintains a current account and which some of the
transactions relating to the subject matter of this action were
carried out.
3. In June, 1986 the plaintiff completed the erection of
c rustique machineries and other equipment ready to com-
mence production of multi-coloured stone bricks at its fac-
tory at Emene Enugu, but the production depended on the
essential raw materials, namely, super white cement and
bayerferrox (iron) oxides which could only be imported
d from overseas.
4. After much expenditure and efforts, on or about 9th May,
1986, the plaintiff obtained an import licence No.
80V0006496 dated 9th May, 1986 valid for foreign ex-
e change to import the said raw materials worth N1,202,830
and specified in the import licence from all countries ex-
cluding South Africa provided such goods were supplied to
the plaintiff on or before the 31st December, 1986. The
plaintiff will rely on this document during trial.
f
5. The plaintiff through its Managing Director, Victor Kanayo
Obikekwe travelled to Western Germany to conclude ar-
rangements with KLOSA and STAAS for credit line: prices
and shipment of the said raw materials. The latter company
g then contacted Deutsche Bank in Western Germany on
plaintiff’s behalf and secured credit line subject to the re-
ceipt of a letter of credit by the said Deutsche Bank. The
condition is contained in their letter of 28th August, 1986.
h This letter will be relied upon at the trial.
6. The plaintiff applied to the defendant for a loan of
N834,850.64 and a letter of credit facilities to be able to
import 1,915 metric tons of super white cement and 24,625
kos (sic) of diverse colours of bayerferrox (iron) oxide (sic)
i from Western Germany.
7. The defendant in a letter of September 19th, 1986 granted
one percent on the N690,000 and a condition that the loan
be repaid from the sales of the product. This letter referred
j to will be founded upon at the hearing of this suit.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
308 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

8. On the 19th of September, 1986, the defendant undertook a

the duty to establish an irrevocable letter of credit for the
importation of the said raw materials as specified in the pro-
forma invoice No. N/1084A/86 of the 8th of August, 1986
from KLOSA and STAAS, and in consequence took pos- b
session of the original proforma invoice of KLOSA and
STAAS.
9. The Second Tier Foreign Exchange Market (SFEM) was to
come into operation on the 29th of September, 1986 and c
only confirmed letter of credit completed before that date
would be transacted under the First Tier Market while oth-
ers from that day would be under the Second Tier Market
which is costlier than the First Tier. The defendant was
aware of this fact and also that several importers and banks
d
were expediting actions so as to beat that date and benefit
from the First Tier Market.
10. The plaintiff promptly complied fully with the terms and
conditions stipulated in the defendants’ letter of undertaking e
dated 19th September, 1986.
11. Although the defendants (sic) was aware that the Second
Tier Foreign Exchange Market (SFEM) would come into
operation on Monday 29th September, 1986, and all rele- f
vant documents were submitted to the defendant’s branch
office, in Enugu, on or before Monday, 22nd September,
1986, to enable the branch office [to] prepare all relevant
documents in good time to meet the deadline, the defendant
neglected to take the necessary steps to beat the said dead- g
line.
12. According to the telex message which the plaintiff received
from KLOSA and STAAS dated 25th September, 1986,
contents of which the plaintiff’s Managing Director person- h
ally brought to the knowledge of the defendant. The
Deutsche Bank was eager to confirm the letter of credit to
beat the SFEM deadline if only the defendant acted quickly.
Despite this telex message, the defendant still failed to
communicate the opening of the said letter to Deutsche
i
Bank before the close of business on the 26th September,
1986.
13. On Friday 26th September, 1986, at about 11a.m. the plain-
tiff’s Managing Director called at the defendant’s office in j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 309

a Lagos to collect plaintiff’s copy of the telex message of

25th September, 1986, prepared by the defendant’s em-
ployee, one Mr Okwonkwo of Foreign Business Depart-
ment conveying to the Deutsche Bank by telex message that
b the irrevocable letter of credit had been opened in favour
of the plaintiff’s beneficiary KLOSA and STASS. But after
a considerable waste of time, at about 4p.m the defendant
informed the plaintiff’s Managing Director that a telex
c message prepared on 25/9/86 was after all not sent out and
that the message would be sent out in the evening. The
plaintiff avers that it was negligence on the part of the de-
fendant that prevented the sending of the said message on
25/9/86.
d
Particulars of Negligence
Fully aware as per the exporter’s letter dated 28th August,
1986 that the Deutsche Bank in Frankfurt, Western Ger-
e
many was eager to confirm the letter of credit; the defen-
dant failed to advise the said bank of the opening of an
irrevocable letter of credit and even when a telex to that ef-
fect was prepared on the 25th September, 1986, the telex
f message was not sent out on that date even though the de-
fendant was fully aware that SFEM would come into effect
on Monday 29th September, 1986 and that the telex mes-
sage sent out on 26th September, 1986 evening which was a
Friday could not reach the addressees till Monday 29th Sep-
g tember, as 27th and 28th being Saturday and Sunday re-
spectively were work free days in Nigeria and in Western
Germany.
14. The plaintiff was forced to request KLOSA and STAAS,
h Western Germany to send another proforma invoice since
the one of 8th August, 1986 was rendered useless due to the
commencement of SFEM. KLOSA and STAAS forwarded
another proforma invoice No. 1084A/86 dated 20th No-
i vember, 1986 after the plaintiff’s Managing Director visited
KLOSA and STAAS Western Germany. The proforma in-
voice was immediately submitted to the defendant on 21st
November, 1986 by the plaintiff. The difference in the price
of the goods between the first and second tiers caused a loss
j of N1,697,800 to the plaintiff.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
310 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Particulars of Loss a
Item 1st Tier 2nd Tier Loss Amount
1. Super 1915m/tons 806m/tons 1109m/tons
White 22180 (50kg)
Cement bags at
b
N70
each bag N1,552,600
2. Bayer 24,62kos 9,500kos 15125kos
(Iron) or 605 (25kg)
at N240
c
each bag N145,200
N1,697,800
Also the plaintiff was forced to obtain an interest free loan
of N140,000 from Denz and Company Limited to settle ex-
d
penses and debts resulting from the negligence of the de-
fendant.
15. In November, 1986 for the purpose of the importation of the
raw materials aforementioned, the plaintiff mandated the e
defendant to participate in auction Bid 10 of 25th Novem-
ber, 1986 on the plaintiff’s behalf but the defendant negli-
gently disqualified the plaintiff from participating on the
ground that the defendant had not a draft No. DX/700594
for N559,290 issued by the defendant’s branch office in f
Enugu, forwarded to and was in possession of the defen-
dant’s head office in Lagos since September, 1986, that is
during the First Tier Foreign Exchange Market so that the
plaintiff’s money N559,290 obtained on loan from the de- g
fendant’s branch office Enugu for which Enugu issued a
draft No. DX/700594 was unutilised whilst the bank inter-
ests on the amount kept on accumulating. The defendant’s
letter on 25th November, 1986 and a foreign exchange req-
uisition form dated 9th December, 1986 from defendant’s h
Enugu Branch office and plaintiff’s letters of 28th Novem-
ber, 1986 and 2nd December, 1986 will be relied upon at
the trial. The defendant is hereby given notice to produce
the said letters and form at the hearing of this case.
i
Particulars of Negligence
Though the draft was in the possession of the bank, it was
negligently not utilised until a later date after the defendant
had disqualified the plaintiff from participation in auction
Bid 10 to the plaintiff’s detriment. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 311

a 16. On 11th December, 1986 the plaintiff was successful in the

SFEM (Second Tier Foreign Exchange Market) BID 12.
The transaction being ‘spot’ market and not ‘forward’ mar-
ket the defendant ought to have immediately on 11th De-
b cember, 1986 opened letter of credit advising the
beneficiary KLOSA and STAAS in Western Germany to
enable KLOSA and STAAS prepare the goods for the
shipment but the defendant negligently treated the transac-
c tion as ‘forward’ market and conveyed the telex message
advising and confirming the irrevocable letter of credit
[Link] 2/87/SFEM HQ. 142/87 LD’6/87 for DM331,603.35
on 13th January, 1987 and opened the irrevocable letter of
credit only on 24th February, 1987, to KLOSA and
d STAAS. This delay meant a delay for the plaintiff to be
paying interest on the borrowed capital which was lying
idle. The defendant is hereby given notice to produce this
letter of 24th February, 1987 at the hearing of this case.

e Particulars of Negligence
The omission of the defendant to handle the transaction
with reasonable despatch required in the circumstances as it
should have been done in the ordinary course of business as
a spot market transaction.
f
17. The shipping documents were sent to the defendant three
weeks before the departure of the ship that brought the
goods to Nigeria and the plaintiff’s goods arrived Nigerian
port at Port Harcourt on the 12th May, 1987. The defendant
g was duly notified in advance of the arrival of the goods. De-
spite the plaintiff’s letter of 5th June, 1987 requesting the
defendant to honour its undertaking including personal calls
by the plaintiff’s representative at the defendant’s office to
h persuade the defendant provide money for the clearance ac-
cording to its undertaking the defendant failed to do so. By
a letter dated 4th June, 1987 written by Port Express Ser-
vices Limited, Port Harcourt to the defendant’s branch of-
fice, Enugu, the defendant was advised that the
i warehousing expenses payable up to the 22nd of June,
1987, in respect of the super white cement consignment was
N110,454.14 but the defendant failed to take the necessary
steps required to enable the plaintiff [to] clear the goods.
The defendant is hereby given notice to produce above re-
j ferred letters at the hearing of this case.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
312 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

18. Earlier on, about 27th May, 1987, KLOSA and STAAS a
wrote Rector International (Nigeria) Limited, Enugu and the
latter in turn wrote to the Managing Director of the plaintiff
company attaching the letter of 27th May, 1987 by KLOSA
and STAAS instructing that the plaintiff could discharge the b
consignment into a warehouse although the practice was
forbidden by the Federal Government of Nigeria.
19. By various letters dated 5th June, 1987, 28th July, 1987,
undated reminder and 21st August, 1987, the plaintiff per- c
sistently requested and reminded the defendant’s branch at
Enugu and employees of the foreseeable consequences
flowing from the defendant’s continued delay to provide the
amount required for clearing the consignment and its con-
tractual or legal duty to see that the goods were cleared in d
accordance with the terms of the defendant’s Enugu branch
office letter of 29th July, 1987, [which] shows that the de-
fendant was aware of the goods’ arrival at Port Harcourt for
the defendant knew in advance when the ship conveying the
goods left port of export and estimated and actual time of e
arrival at Port Harcourt.
20. When Port Express Services Limited, Port Harcourt, the
warehousing agent, wrote to the plaintiff a letter of 10th
July, 1987 and warned that 16,120 bags of 806 metric tons f
of super white cement consignment imported by the plain-
tiff would be included in the list of overtime cargo to be
auctioned by the Federal Government of Nigeria and re-
quested the plaintiff to evacuate them with despatch, the
plaintiff notified the defendant at once but the defendant g
remained adamant and unperturbed.
21. When the defendant failed to provide the money required to
clear the goods the plaintiff had no alternative but to borrow
the sum of N244,971 with interest from the Co-operative
and Commerce Bank (Nigeria) Limited, Enugu, through its
h
Managing Director to enable the plaintiff clear, transport
and store the goods. A total sum of N194,151.29 was paid
by the plaintiff for demurrage and other charges as invoice
PESL N. 017 of the 16th July, 1987, shows. i
22. In compliance with the terms of the loan from the Co-
operative and Commerce Bank (Nigeria) Limited, the super
white cement of 776 metric tons or 15,520 bags were deliv-
ered to the plaintiff but were stored in a warehouse at Ogbor
Hill, Aba, at a storage rent of N1,000 per month. Although j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 313

a the bayerferrox (iron) oxides and 600 broken bags of super

white cement have been delivered in the building at Emene,
Enugu, the plaintiff could not go into production without
the 15,520 bags of cement being released to the plaintiff.
b
23. According to the agreement between the plaintiff and the
Co-operative and Commerce Bank (Nigeria) Limited, their
(sic) super white cement would be released on payment of
N244,971 and any other interest and charges accruing
c
thereto. As the defendant failed to provide the funds for re-
payment of the said sum of N244,971 borrowed from the
Co-operative and Commerce Bank (Nig.) Limited for clear-
ing of the said goods plus accrued interest, which as at 21st
d January, 1988 had amounted to N308,351.25 to the knowl-
edge of the defendant, the said Bank sold the saleable quan-
tity of the said super white cement numbering 12,000 bags
at the end of August, 1988 as the goods had deteriorated by
caking and could not be used for the manufacture of cast
e stone bricks. The said bank charges and rental for the ware-
house at the rate of N1,000 a month for the twelve months
the super white cement remained stored in the said ware-
house. In fact the final figure of the debt and the accrued in-
f terest is N393,247.25.
24. As a result of the facts averred in paragraphs 22 and 23
above, the plaintiff suffers damages for the payment of rent
and for keeping the factory machines idle and the bank in-
g terest in the loan running.
25. The plaintiff’s machines and equipment are now lying idle
and rusting away owing to the acts of negligence exhibited
by the defendant. In consequence the plaintiff will expend
h the sum of N85,000 to service the machineries and equip-
ment before putting them to use.

26. The negligent acts of the defendant have caused the plaintiff
not to manufacture its products resulting in a heavy loss of
i profits of N8,570,215 (it equivalent in the first quarter of
1989 having regard to the depreciated value of the naira be-
ing N20 million).
27. Wherefore the plaintiff claims from the defendant the sum
j of N22,650,337.50 special and general damages.
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
314 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Particulars of Special Damages a

1. Loss of 1,109 metric tons or 22,180
(50kg) bags of super white cement
at N70 per bag N 1,552,600
2. Loss of 15,125 kos or 605 (25kg) b
bags of bayerferrox (iron) oxide
at N240 per bag N 145,200
3. Demurrage N 194,151.29
4. Interest charged by the defendant
on aforesaid loan to the plaintiff c
from 24th September, 1986 to 31st
January, 1989 N 333,138.96
5. Loan from and accrued interest
thereon charged by Co-operative
and Commerce Bank (Nigeria) d
Limited N 393,247.25
6. Rental for warehouse at Ogbor
Hill Aba N 12,000
7. Loss of profit N20,000,000
TOTAL N22,650,337.50” e
In its own defence the defendant’s amended statement of
defence at pages 72–85 of the record reads as follows:–
“AMENDED STATEMENT OF DEFENCE
f
1. Save as hereinafter expressly admitted, the defendant denies
each and every one of the allegations of facts as are con-
tained in the plaintiff’s statement of claim as if the same
have been set out and specially traversed seriatim.
2. The defendant admits paragraphs 1 and 2 of the plaintiff’s g
statement of claim.
3. Paragraph 3 of the statement of claim. The defendant admits
paragraph 3 of the statement of claim to the extent only that
the defendant was aware of the fact that the plaintiff had h
erected plants and machineries in the factory and was await-
ing raw materials in order to commence production. But the
defendant denies both Bayer Ferrous oxides and super white
cement are raw materials. Rather only Bayer Ferrous oxides
were to be used as raw materials, while super white cement i
was to be sold for money or money’s worth. This was so
stated as well as in the plaintiff’s letter of application for the
opening of credit addressed to the defendant which letter
dated the 16th day of July, 1986 will be founded upon at the
trial of this suit. j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 315

a 4. In further answer to paragraph 3 of the statement of claim

the defendant avers that the super white cement was im-
ported, discharged, cleared and collected by the plaintiff in
or about the month of May, 1987. The plaintiff had since
b utilised the said super white cement.
5. Paragraph 4 of the statement of claim. The defendants
admits paragraph 4 of the statement of claim to the extent
only that the plaintiff obtained an import licence dated the
c 9th of May, 1986 and submitted the same to the defendant
before the expired date of 31st December, 1986. But the de-
fendant humbly would observe that the plaintiff did not
submit the import licence to the defendant until the 16th day
of July, 1986 when he submitted the same with his applica-
d tion for letter of credit and overdraft to finance the purchase
of goods and import expenses.
6. In further answer to paragraphs 4 of the statement of claim
the defendant avers that when the plaintiff submitted his
e import licence and the letter dated 16th day of July, 1986
the following facts were in issue and needed to be taken
into consideration.
(a) The plaintiff was not liquid and wanted some money in
addition to the sum already advanced to it. The plaintiff
f was asking for a further credit of N1.287 million.
(b) The credit applied for was to finance the letter of credit,
import duty, freight, insurance and other charges.
(c) The credit is not automatic nor can it be taken for
g granted. It requires the consideration and approval of the
defendant’s board of Directors.
(d) When approval was given for the loan.
(e) When the pre-conditions for the release of the loan were
fulfilled by the plaintiff as are contained in the defen-
h dants’ letter of approval dated 19th day of September,
1986 addressed to the plaintiff.
7. Paragraph 5 of the statement of claim. The defendants
admits paragraph 5 of the statement of claim and in further
i answer to this paragraph the defendant would add that rely-
ing on this understanding between the plaintiff and the
Deutsche Bank in Western Germany the defendant went
ahead and established the letter of credit. But the same
Deutsche Bank turned back and declined to confirm credit
j so established by the defendant and insisted that a cash
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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316 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

cover must be made. This development was promptly a

communicated to the plaintiff in the defendants’ letter dated
the 9th day of October, 1986. This letter will be founded
upon at the trial of this suit. The plaintiff is hereby given
notice to produce the said letter at the trial of this suit. b
8. In further answer to the paragraph 5 of the aforesaid, the
defendant states that in the said letter the defendant advised
the plaintiff to get in touch with the dealers in Western Ger-
many and sort out all the issue of credit line. The plaintiff c
was sent a reminder dated the 4th day of November, 1986
and the plaintiff could not show up on the 25th day of No-
vember, 1986 to collect a Bid form. The defendant will
found upon the letter of reminder dated the 4th day of No-
vember, 1986 and the plaintiff is hereby given notice to d
produce the said letter at the trial of the suit
9. Paragraphs 6 and 7 of the statement of claim. The defendant
denies paragraphs 6 and 7 of the statement of claim and the
defendant avers that the plaintiff applied for an overdraft of
e
N1,639,307.40 made up of N1,056,907 letter of credit,
N360,849 surcharge, N211,381.40 advance import duty and
N10,569 being the plaintiff’s projected bank charges. This
was for the purchase of and importation of Bayer Ferrous
oxide and two brands of cement namely super white cement f
and Portland cement.
10. In further answer to paragraphs 6 and 7 of the statement of
claim the defendant avers that the defendant approved the
sum of N690,000 as a loan to the plaintiff in the defendant’s
letter dated 19th day of September, 1986 addressed to the g
plaintiff. In the defendant’s letter of approval aforesaid the
defendants made the loan subject to 1% commitment fee to
be paid by the plaintiff to the defendant from the proceeds
of the sale of the goods, namely the two brands of cement,
but not from the proceeds of sale of products of the factory.
h
The defendant will at the trial of this suit found upon the
letter of approval of loan to the plaintiff. The plaintiff is
hereby given notice to produce the said letter at the trial.
11. The defendant admits paragraph 8 of the statement of claim i
to the extent only that in its normal course of duty it com-
menced to establish irrevocable letter of credit on satisfying
itself that the preliminary requirements for opening of ir-
revocable letter of credit such as the funds and the proforma
invoice have been met by the plaintiff. j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 317

a 12. Paragraph 9 of the statement of claim. The defendant ad-

mits:
(a) That the Second Tier Foreign Exchange Market (SFEM)
b was to come into effect on the 29th day of September,
1986.
(b) That only confirmed letters of credit which were con-
firmed on or before the 29th day of September, 1986
could be transacted under the First Tier Exchange For-
c eign system.
(c) That the Second Tier Foreign Exchange Market is cost-
lier than the First Tier in the rate of naira exchange for
other world currencies. It is also true that most Banks
d and importers were striving to beat the date line. But the
defendant in spite of the short time it had to scale
through and the unprecedented rush at the Bank the de-
fendant succeeded in establishing the letter of credit with
the confirming bank in Western Germany being
e Deutsche Bank of Frankfurt on the 25th day of Septem-
ber, 1986. The defendant will found upon a copy of the
telex dated the 25th day of September, 1986 which was
tested and found received on the following day the 26th
day of September, 1986.
f
13. In further answer to paragraph 9 of the statement of claim,
the defendant states that the Central Bank of Nigeria regula-
tion requires that on (sic) advance import duty should be
paid before a letter of credit is established. The plaintiff
g paid the advance import duty on the 25th day of September,
1986 and rushed the receipt to the defendant about 4.30p.m
after Banking Hours. The receipt No. 560883 of the 25th
day of September, 1986 will be founded upon at the trial of
this suit.
h
14. In further answer to paragraph 9 of the statement of claim
the defendant states that the defendant properly communi-
cated the establishment of a letter of credit to the plaintiff’s
advising Bank on the same day the 25th day of September,
i 1986 by telex and there and then requested them to confirm
the letter of credit, but they declined to confirm and insisted
on cash cover, a demand which could not have been met be-
fore the 29th day of September, 1986. The defendant further
avers that in line with their requirements stipulated in the
j letter marked 25th day of August, 1986 addressed to the
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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318 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

plaintiff by its suppliers by name KLOSA and STAAS of a

Western Germany by the defendant successfully and
promptly communicated to Deutsche Bank the establish-
ment of a letter of credit in favour of the plaintiff’s suppli-
ers. b
15. Paragraph 10 of the statement of claim. The defendant
denies paragraph 10 of the statement of claim and the plain-
tiff is therefore put to the strictest proof thereof.
16. Paragraph 11 of the statement of claim. The defendant c
admits that it was aware that the First Tier Foreign Ex-
change Market was to come into effect on the 29th day of
September, 1986 but the defendant denies the rest of the
paragraph 11 and the plaintiff is therefore put to the strictest
proof thereof. d
17. In further answer to paragraph 11, the defendant avers that
the plaintiff handed in the last of the relevant documents to
the defendants on the 25th day of September, 1986 being
the advance duty payment receipt and the defendant acted e
on to (sic) matter at once.
18. Paragraph 12 of the statement of claim. The defendant
denies paragraph 12 of the statement of claim and states that
it is not true that the letter of credit was not opened on the
f
25th day of September, 1986. The defendant opened a letter
of credit on 25th day of September, 1986 and communi-
cated the same to Deutsche Bank that same day. It is not the
duty of the defendant to inform the beneficiary of the letter
of credit that its letter of credit has been established and g
opened. It is the duty of the advising correspondent bank
and in this case Deutsche Bank which is to advise the sup-
plier and in this case Klosa and Staas.
19. Paragraph 13 of the statement of claim. The defendant
denies in the strongest terms paragraph 13 of the statement h
of claim and the plaintiff is put to the strictest proof thereof.
19(a) In further answer to paragraph 13 of the statement of
claim. The defendant avers that it made it clear to the
plaintiff that the defendant could not guarantee any i
line or lines of credit and that the defendant could not
therefore be held liable in any manner whatsoever for
non confirmation of the letter of credit. This was ini-
tially agreed upon between the plaintiff and the defen-
dant and the agreement was put into writing in a j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 319

a document dated 24th day of September, 1986. The

document will be relied upon at the trial of this suit.
19(b) In further answer to paragraph 13 of the statement of
claim, it was also agreed between the plaintiff and the
b
defendant that any excess amount of money to be paid
by the defendant over the current Foreign Exchange
rate as contained in a letter of credit due to fluctuation
in the rate of exchange prevailing in the date of final
c settlement in Foreign Exchange should be borne (sic)
by the plaintiff. Pursuant to this the plaintiff executed
in favour of the defendant an indemnity dated 23rd
day of January, 1986. This indemnity will be relied
upon at the trial of this suit.
d 19(c) In further answer to paragraph 13 the defendant avers
that the plaintiff was well aware of the uncertainty at
the time in confirmation of letter of credit. This was
why in plaintiff’s letter dated 24th day of September,
e 1986 addressed to the defendant the plaintiff sug-
gested two alternatives to be adopted by the defendant
in order to achieve confirmation of the letter of credit.
This letter will be founded upon at the trial.
20. Paragraph 14 of the statement of claim. The defendant is
f aware that the Deutsche Bank refused to confirm the letter
of credit before the 29th day of September, 1986 denying
the plaintiff the opportunity of benefitting from the First
Tier Foreign Exchange Market. But the defendant denies
g being responsible for the loss of opportunity or being negli-
gent, reckless or careless in any manner whatsoever in the
defendant’s handling of the plaintiff’s letter of credit, or at
all. The defendant further denies being responsible for the
loss of charges suffered by the plaintiff as a result of which
h the plaintiff missed the First Tier Exchange Market.
21. Paragraph 15 of the statement of claim. The defendant
denies vehemently paragraph 15 of the statement of claim
and the plaintiff is therefore put to the strictest proof
i thereof.
22. In further answer to paragraph 15 of the statement of claim
the defendant states that the plaintiff was disqualified in
the Auction Bid No. 10 of the 25th day of November,
1986 because it did not make a formal application under the
j First Tier Foreign Exchange Market, but had to rely on its
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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320 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

pre-SFEM application No. LC/EN/4/86. The plaintiff was a

invited by the defendant in the defendant’s letter of the 9th
October, 1986 to attend at the defendant’s Enugu Main
Branch for the defendant to explain to it the implications of
the non-confirmation of the letter of credit but the plaintiff b
did not come. The Defendant sent a reminder letter dated
the 4th day of November, 1986 yet the plaintiff did not
come until the 25th day of November, 1986 when it came to
complete a bid form to secure the necessary cash cover.
c
23. In further answer to paragraph 15 of the statement of claim
the defendant states that it was made clear to the plaintiff
that release of the Bank draft amounts to a refund and that
this cannot be done unless and until the defendant received
confirmation from the advising Bank, in this case Deutsche d
Bank of the cancellation of the First Credit established by
the defendant in CC/EN/4/86 with the Bank for the benefi-
ciaries.
24. Paragraph 16 of the statement of claim. The defendant
e
admits paragraph 16 of the statement of claim to the extent
only that the plaintiff was successful in the SFEM (Second
Tier Foreign Exchange Market) bid No. 12 of the 11th day
of December, 1986. The rest of the paragraph is denied by
the defendant. f
25. In further answer to paragraph 16 of (sic) the defendant
states that there is no ‘Spot’ or ‘Forward’ (Market in Nige-
ria). The letter of credit could not have been established on
the 11th day of December, 1986. Besides the Central Bank
of Nigeria requires import duty to be paid in advance before g
a letter of credit could be established. The plaintiff did not
pay the import duty until the 8th day of January, 1987.
26. In further answer to paragraph 16 above the defendant
states that the Central Bank of Nigeria sells only United h
States of America Dollars to Banks at the auction and cred-
its the account of the Bank in the United States of America
Dollars. The plaintiffs purchased a total of 155,136.47US
Dollars at the auction, and not in Deutsche Marks required
by the plaintiff. The defendant had to instruct its US corre- i
spondence Bank in New York to transfer 155,136.47 to the
defendant’s London Branch to enable London Branch [to]
buy 311,603.35 DM at the London ‘spot’ Market. The de-
fendant’s London Branch went to the London ‘spot’ market
and found out that the selling rate was 1,7845 to one US j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 321

a Dollar and that an additional sum of 19,480.14 U.S. Dollars

was required to make up 311,603DM to cover the amount
of the letter of credit. In order not to frustrate the letter of
the credit, the defendant made up the amount of the letter of
b credit and there and then transferred the amount to
Deutsche Bank of Western Germany a gesture which the
plaintiff did not appreciate. There was no delay in any man-
ner whatsoever in the whole transaction having regard to
c the circumstances of the case.
27. Paragraph 17 of the statement of claim. The defendant
denies paragraph 17 of the statement of claim and the de-
fendant in answer to the same, avers that by paragraph 7 of
the defendant’s letter of approval of the loan addressed to
d the plaintiff dated 19th day of September, 1986, the said
paragraph 7 provides that the plaintiff shall bear the cost of
warehousing of the goods and other charges relating to the
clearing of the goods.
e 28. In further answer to paragraph 17 of the statement of claim
the defendant avers that because of the plaintiff’s inability
to pay for the clearance and storage of goods in line with
the provisions of paragraph 7 of the letter of approval afore-
said, the plaintiff applied to the defendant for approval of
f yet another loan in the sum of N110,454 and the approval
took some time to come through. The defendant is not liable
therefore to the plaintiff for any delay of charges, fines or
damages which may have been brought about by the delay
g in clearing and taking delivery of the goods at the Port Har-
court Wharf, or at all.
29. Paragraph 18 of the statement of claim. The defendants
denies paragraph 18 of the statement of claim and avers that
the defendant does not know of any letter dated 27th day of
h May, 1987 written by KLOSA and STASS to Rector Inter-
national Nigeria Limited who in turn wrote to the plaintiff
instructing that the plaintiff could discharge the consign-
ment into a warehouse. The defendant avers categorically
that there is no law in Nigeria which prohibits importers
i
from discharging of their goods in a warehouse as long as
the requirements have been met.
30. The defendant denies paragraphs 19 and 20 of the statement
of claim. The defendant in further answer to paragraphs 19
j and 20 of the statement of claim avers that the grant of loan
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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322 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

which has been applied for by the plaintiff required time to a

process and approve. In this case the plaintiff applied for
grant of further loan and the same was granted by the de-
fendant’s top management. It was not automatic nor was it
obligatory upon the defendant to provide the loan for the b
clearance of the goods.
31. Paragraphs 21 of the statement of claim. The defendant
denies paragraph 21 of the statement of claim as the defen-
dant had no knowledge of the transactions. The plaintiff is c
therefore put to the strictest proof thereof
32. Paragraphs 22, 23 and 24 of the statement of claim. The
defendant denies paragraphs 22, 23 and 24 of the statement
of claim and the plaintiff is therefore put to the strictest
proof. d
33. In further answer to paragraphs 22, 23 and 24 of the state-
ment of claim the defendant says that when the plaintiff’s
application for further loan was approved the defendant
paid the same amounting to N110,454 for clearing, and port e
charges, including demurrage, on behalf of the plaintiff.
The defendant was not aware of the transactions including
agreement between the plaintiff and Co-operative and
Commerce Bank of Nigeria Limited and Comex Interna-
tional Limited in which transactions the plaintiff had to bor- f
row money for clearing the goods or at all.
34. The defendant will contend at the trial of this suit that the
letter of credit was established subject to the Uniform Cus-
toms and Practice for Documentary Credit (1983) Revision
g
LCC Publication No. 400 to which Nigeria has subscribed
which provides inter alia as follows:
Article 18
Banks assume no liability or responsibility for the conse-
quences arising out of delay and/or loss in transit of any h
messages, letters or documents or for delay, mutilation or
other errors arising in the transmission of any telecommuni-
cation. Banks assume no liability or responsibility for errors
in translation or interpretation of technical terms, and re-
i
serve the right to transmit credit terms without translating
them.
Article 20
(a) Bank utilising the services of another bank or other
banks for the purpose of giving effect to the instruction j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 323

a of the applicant for the credit do so for the account and

at the risk of such applicant.
(b) Bank assume no liability should the instructions they
transmit not be carried out, even if they have themselves
b taken initiative in the choice of such other banks.
These provisions will be relied upon at the trial of this suit.
35. Paragraphs 25 and 26 of the statement of claim. The defen-
dant denies paragraphs 25 and 26 of the statement of claim
c and the plaintiff is hereby put to the strictest proof thereof.
36. Paragraph 27 of the statement of claim. The defendant
denies being liable to pay the sum of N13,000,000 (Thirteen
Million Naira) (sic) special and general damages for negli-
d gence; the particulars of which are stated in paragraph 27
sub-paragraph 1, 2, 3, 4, 5, 6, 7, 8, 9(a), (b) and (c) to the
plaintiff or at all. And the defendant will urge the Honour-
able Court at the trial to dismiss the plaintiff’s claim as
speculative and without merit.
e Counter-claim
37. The plaintiff, a company incorporated in Nigeria with
limited liability whose head office is situate at Enugu and
which carries on business at Enugu is indebted to the defen-
f dant a company incorporated in Nigeria, with Limited Li-
ability and whose head office is situate in Lagos carrying on
business in Enugu as a Banker in the sum of N2,276,620.61
(Two Million, Two Hundred and Seventy-six Thousand,
Six Hundred and Twenty Naira, Sixty kobo) as at close of
g business on the 31st of December, 1987 being total loan or
overdraft granted the plaintiff by the defendant at the plain-
tiff’s request. The plaintiff has not repaid all or part of the
loan overdraft to the defendant.
38. The plaintiff has been and is one of the defendant’s numer-
h ous customers and the plaintiff operates a current account
No. B 102966/6374 with the defendant in the defendant’s
Enugu Main Branch at No. 3 Ogui Road, Enugu.
39. On or about the 6th day of March, 1980, the defendant at
i the request of the plaintiff granted the plaintiff a loan or an
overdraft in the sum of N100,000 (One Hundred Thousand
Naira) on compound interest at the rate of 10% (ten percent)
per annum with monthly rests. The plaintiff withdrew the
whole amount from its current account aforesaid. As at
j close of business on the 25th day of January, 1983 the
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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324 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

plaintiff was indebted to the defendant in total sum of a

N141,795.97 (One Hundred and Forty-one Thousand,
Seven Hundred and Ninety-five Naira, Ninety-seven Kobo)
being balance of overdraft and other charges.
b
40. On the 4th day of March, 1983, the sum of N50,000 (Fifty
Thousand Naira) was approved for the plaintiff by the de-
fendant payable within one year, with compound interest at
the rate of 10% (ten percent) per annum with monthly rests.
41. By the defendant’s letter dated 10th day of July, 1986 c
addressed to the plaintiff the defendant raised the limit (sic)
of the loan or overdraft of N650,000 (Six Hundred and Fifty
Thousand Naira) for a further period of 2 years to be repaid
on or before the 15th day of July, 1987 with compound in-
terest at the rate of 13% (thirteen percent) per annum with
d
monthly rests. The plaintiff is hereby given notice to pro-
duce the said letter at the trial of this suit.
42. By a letter dated the 19th day of May, 1986 addressed to the
plaintiff by the defendant the defendant granted the plaintiff e
a further N100,000 (One Hundred Thousand Naira) with
compound interest at the rate of 13% (thirteen percent) with
monthly rests. The plaintiff is hereby given notice to pro-
duce the said letter at the trial of this suit.
f
43. The plaintiff applied for more credit to enable him [to]
purchase and import some goods mentioned in the forego-
ing paragraphs. By the letter dated 19th day of September,
1986 the defendant granted the plaintiff further sum of
N690,000 (Six Hundred and Ninety Thousand Naira) for g
opening of letters of credit for the importation of oxides,
white and Portland Cement. The letter of approval aforesaid
will be founded upon and the plaintiff is hereby given no-
tice to produce the same at the trial of this suit. The plaintiff
was at all times sent a statement of account. h
44. The foregoing approvals are merged in the plaintiff’s Cur-
rent Account No. B10 2966/6374 now computerised as No.
04214508. The defendant delivered to the plaintiff the
statement of account of the plaintiff for the periods (a) i
26/1/83 to 22/4/87 (b) 2/5/87 to 29/5/87 (c) 30/5/87 to
30/6/87 (d) 30/6/87 to 31/8/87 (e) 30/9/87 (f) 1/10/87 to
30/10/87 and (g) 1/11/87 to 31/12/87 and the plaintiff is
hereby given notice to produce the same at the trial of this
suit. Total indebtedness of the plaintiff to the defendant as j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 325

a at close of business on the 31st day of December, 1983 is

N2,276,620.61.
45. By the plaintiff’s letter of the 16th day of July, 1986 to the
b defendant in which the plaintiff applied for more credit or
overdraft, the plaintiff undertook to repay the entire loan or
overdraft with proceeds of sale of the two brands of cement
to be imported by the plaintiff with defendant’s overdraft.
46. The plaintiff has since cleared and taken delivery of goods,
c sold them and refused and/or neglected to pay the defendant
the same overdraft despite repeated demands. The plaintiff
has rather brought this claim in damages for negligence
against the defendant.
d 47. WHEREFORE the defendant counter-claim against the
plaintiff as follows:–
(i) The sum of N2,276,620.61 (Two Million, Two Hundred
and Seventy-six Thousand, Six Hundred and Twenty
Naira, Sixty-one Kobo) (sic) being overdraft with com-
e pound interest granted to the plaintiff by the defendant at
the plaintiff’s request with monthly rests, as at close of
business on the 31st day of December, 1987.
(ii) Compound interest at the rate of 15% per annum with
f monthly rests until judgment is given.”
I will now refer to specific findings of fact made by the
learned trial Judge. Before doing so, however, I need to
remind myself of the claims; failure of the respondent to
g send the telex message to West Germany in order to beat the
SFEM (The Second-Tier Foreign Exchange Market) Decree,
1986 made in Lagos on 15th August, 1986 which came into
force on 29th September, 1986.
h
The learned trial Judge found:–
(i) That all the necessary documents needed by the
defendant to send the telex message to Deutsche
i Bank in Germany was handed over to the defendant;
(ii) That no telex message was sent by the defendant as
claimed in their pleading;
(iii) That exhibit 1A was made in anticipation of litiga-
j tion;
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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326 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

(iv) That by the time the telex message was sent by the a
defendants on 26th September, 1986 the bank in
Frankfurt had closed;
(v) That PW3 was a witness of truth. b
The defendant appealed. The appeal was allowed and the
claims of the plaintiff were dismissed with costs. With re-
gard to the counter-claim, the order of dismissal was set
aside and it was ordered that the counter-claim be heard and c
tried.
Leave of the lower court was obtained to appeal on
grounds of appeal of mixed law and fact. There are six
d
grounds of appeal filed against the judgment. Owing to the
nature of the briefs filed and the issues raised by both parties
the grounds and their particulars though prolix must be pro-
duced hereunder for a better understanding and appreciation
of the submissions made before us. These grounds read as e
follows:–
“1. The Court of Appeal erred in law in the following passage
of its lead judgment which led it to a wrong decision:
‘I do not see that the defendant’s liability can be founded f
on its failure to send the telex on 25th September, 1986
which learned Judge called a breach of contract. I cannot
also in all the circumstance come to the conclusion that
the alleged negligence of the defendant caused the plain- g
tiff any damage. In fact it has not been proved that the
defendant was in breach of any duty owed to the plain-
tiff.’
Particulars of Error
(a) A contract in a very elementary definition is an arrange- h
ment whereby a person undertakes for reward to perform
an act for another.
(b) The defendant admitted in its pleadings that it undertook
for reward to establish a letter of credit for the plaintiff i
and inform Deutsche Bank of Western Germany by telex
message before coming into force of the Second Tier
Foreign Exchange Market in order to enable the plaintiff
to benefit from the more favourable terms of the 1st Tier
foreign Exchange Market. j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 327

a (c) The defendant admitted that unless the said telex mes-
sage was received by the said Deutsche Bank before the
close of business on the 26th of September, 1986 the
plaintiff would lose the financial benefit of the first Tier
b Foreign Exchange Market.
(d) The defendant pleaded that it fulfilled its said obligation.
(e) The court of trial found it defaulted and the defendant
did not appeal against this finding.
c (f) The trial court further held: ‘one would ask what pre-
vented the defendants from sending the message in the
morning hours (i.e. of 26th September, 1986). Their atti-
tude in this regard can be attributed to gross irresponsi-
bility and negligence’.
d
(g) This finding of the trial court accords with the complaint
of the plaintiff. The plaintiff did not found its action on
the tort of negligence as subtly urged by the defendant in
the Court of Appeal and is allowed (sic) by the court.
e (h) The court below therefore was wrong in its conclusion
urged by the defendant that the plaintiff’s action was
based on negligence but the trial court gave judgment to
it for breach of contract.
f 2. The Court of Appeal completely misconceived the com-
plaint of the plaintiff in the trial court upon which the said
Court adjudicated and thereby misdirected itself in law and
on the facts in the following passages of its lead judgment
upon which it grounded its dismissal of the plaintiff’s suit;
g namely, that it was not shown by evidence of substance or
of probative value that Deutsche Bank or banks in Germany
close business at 4 p.m. that ‘the fact that PW.3 said in evi-
dence that banks in West Germany close at 4 p.m. does not
shift my (sic) onus onto the defendant to rebut’; that ‘it was
h not pleaded and not given in evidence that the defendant
was aware that banks in Germany close at 4p.m. or that they
could not act on the day a telex was sent if sent after 4p.m.’;
that there is nothing that can be relied upon till now apart
from hearsay contained in exhibit L that Deutsche Bank
i
was ready to add their confirmation.
Particulars of Misdirection
(a) The complaint of the plaintiff was that because the
defendant did not inform the Deutsche Bank of West
j Germany of the establishment of the letter of credit for
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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328 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

the plaintiff before the close of business on 26th Sep- a

tember, 1986 the plaintiff lost purchasing raw materials
covered by the import licence issued it under the First
Tier Foreign exchange Market which the defendant ad-
mitted was cheaper than in the Second tier Foreign Ex- b
change Market under which it eventually made purchase.
(b) It was the same Deutsche Bank that confirmed another
letter of credit established for the plaintiff by the defen-
dant under the Second Tier Foreign Exchange Market. c
(c) It was the defendant that conducted the bid for the plain-
tiff under the Second Tier Foreign Exchange Market.
(d) The plaintiff pleaded in the particulars under paragraph
13 of its statement of claim both original and amended
that a telex sent out in the evening of Friday after the d
close of business for the day would not beat the 2nd Tier
Foreign Exchange Market.
(e) The pleading of the defendant was that it sent the telex
informing Deutsche Bank on the opening of the letter of e
credit on 25th September, 1986.
(f) It was not the case of the defendant that it was not aware
that banks close in Western Germany by 4 p.m. local
time here.
(g) It is very elementary knowledge that once a business
f
house closes for the day any communication addressed
to it has to await re-opening of the business house on the
next working day.
(h) Evidence is not pleaded. g
(i) The Evidence Act enjoins the court to take judicial
notice of the divisions of time.
(j) It was not the case of the defendant on its pleading that it
did not know of the date of coming into force of the 2nd h
Tier Foreign Exchange Market until 25th September,
1986 as speculated by the Court of Appeal. It pleaded
knowledge of the said date and of the financial repercus-
sions to the plaintiff if the telex message was not re-
ceived by Deutsche Bank before the coming into force of i
the 2nd Tier Foreign exchange market on 29th Septem-
ber, 1986. The 27th and 28th of September, being non-
working days in both Western Nigeria as in Nigeria.
3. The court below misdirected itself in law and on the facts in
the passage of its lead judgment quoted hereunder which j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 329

a led it to reverse the judgment of the court below based on

the proved facts and substitute therefore a judgment based
on conjecture and speculation:
b ‘It seems to me, as I said earlier, that the need to have a
confirmed irrevocable LC came much later than the time
a contract was reached by the parties for the opening of
an irrevocable LC on 19th September, 1986. At that time
it would appear there was nothing officially known of
c the Second-Tier Foreign Exchange Market (SFEM). The
averments in paragraphs 9, 10 and 11 of the amended
statement of claim that the defendant then knew of
SFEM, and that the plaintiff had by 22nd September,
given it all relevant documents to take steps to meet the
d deadline and so qualify under the First-Tier, cannot
really be supported by facts. It appears that the reality of
the coming of SFEM was not established until Decree
No. 23 known as Second-Tier Foreign Exchange Market
e Decree, 1986 was published in Lagos on 24th Septem-
ber, 1986 in an Extraordinary Gazette as Government
Notice No. 650. That was when Government Notice of it
was legally given to the banks and their customers. At
least no other source of knowledge was pleaded.’
f It was obviously that Decree that made the plaintiff wants to
secure confirmation of its LC. It sought to do this by itself
scouting for a confirming banker. It appeared to have got
one through the efforts of the sellers. That was what gave
g rise to exhibit L. It was after exhibit L was received by the
plaintiff (not before 25th September) that pressure was put
on the defendant by the plaintiff to see how the LC would
be confirmed under section 15(2)(a) of Decree No. 23.

h Particulars of Misdirection
(a) The obligation of the defendant to the plaintiff was not
an issue in the trial court.
(b) The defendant pleaded in paragraph 14 of its amended
i statement of defence that in line with the requirements
stipulated in the letter dated 25th day of August, 1986
addressed to Staas of West Germany the defendant suc-
cessfully and promptly communicated to Deutsche Bank
the establishment of a letter of credit in favour of the
j plaintiff’s suppliers.
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330 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

(c) The defendant further pleaded in paragraphs 7 and 14 of a

its amended statement of defence that it was aware that
Deutsche Bank was will (sic) to give credit provided it
received a letter of credit from the defendant and relying
on this understanding between the plaintiff and Deutsche b
Bank it went ahead and established the letter of credit
and that the defendant properly communicated the estab-
lishment of a letter of credit to the plaintiff’s advising
bank on the same day the 25th day of September, 1986
by telex and there and then requested them to confirm
c
the letter of credit but they declined to confirm and in-
sisted on cash cover a demand which could not have
been met before the 29th day of September, 1986.
(d) The learned trial Judge found as a fact that the defendant d
did not send out the telex message to Deutsche Bank of
Western Germany which it averred it did on the 25th of
September, 1986.
(e) The trial court also found that exhibit 1A i.e. the alleged
telex message was a document made in anticipation of e
litigation.
(f) There was no appeal from these findings of fact but the
Court of Appeal held suo motu that the message was
sent, tested and found received the following day 26th f
September, 1986.
4. The court below erred in law in embarking on an evaluation
of the evidence tendered at the trial, when the facts testified
to in evidence by the plaintiff were not challenged in cross-
examination nor rebutted by contrary evidence and were in g
fact believed by the trial court and worse still, basing its
said evaluation on speculation and conjectures.
Particulars of Error
(a) It was sheer speculation for the Court of Appeal, after h
holding that evidence was not brought to controvert
some aspects of the evidence of the principal witness for
the plaintiff, to find that it seemed impossible from the
available evidence for any steps to be taken by the de-
fendant to ask Deutsche Bank to add their confirmation i
to the letter of credit before the letter from Klosa and
Stass dated 25th September, 1986 as received, when the
defendant pleaded that it sent the letter of credit to
Deutsche Bank for confirmation on 25th September,
1986. j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 331

a (b) It was sheer speculation for the court below to hold that
‘it is most unlikely that PW.3 travelled to Lagos on 24th
September, 1986 as given by him in evidence with all
the relevant documents which were delivered to the de-
b fendant bank’s Lagos Office’ when the defendant
pleaded in paragraphs 11 and 12(c) of its defence that it
received all relevant documents from the plaintiff bore
(sic) it opened a letter of credit which it communicated
c to Deutsche Bank on 25th September, 1986.
(c) Evaluation of evidence is the primary and exclusive
function of the trial court subject to exceptions which
were not canvassed by the defendant in the court below.
5. The Court of Appeal erred in law in itself raising remote-
d
ness of damage for the defendant when the defendant did
not specifically make remoteness of damage a ground of
appeal.
Particulars of Error
e (a) The ground of appeal filed by the defendant was that the
‘damages awarded were excessive and unreasonable and
there was no legal or rational ground for making the
award’.
f (b) The defendant never pleaded remoteness of damage in
the trial court.
(c) The observation of the Court of Appeal on pleading how
loss of profits was worked out means that evidence must
g be pleaded contrary to the rules of the pleading.
(d) The other observation of the Court of Appeal on the
damages awarded overlooked the dicta of the Supreme
Court on proof of special damages, namely, that there is
no special category of evidence required by law for
h proof of special damages and that the ipse dixit of the
claimant will suffice in circumstances such as the instant
case.
6. The Court of Appeal erred in law in holding that there was
i no basis for dismissing the defendant’s counter-claim after
it had earlier warned the defendant’s counsel to appear in
the High Court to conduct the case of the defendant and the
said counsel refused to attend the court on the ground that
the defendant instructed him not to appear further in the
j case.
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332 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Particulars of Error a
(a) It was within the discretion of the High Court to dismiss
or strike out the counter-claim.
(b) It is not the function of an appellate court to substitute its b
discretion for that of the trial court.
(c) There was no complaint that the High Court took irrele-
vant considerations into account in exercising its discre-
tion.
(d) A party who files an action in court and refused to pur- c
sue it at the trial will not be heard to complain that his
claim was dismissed.”
The plaintiff who is the appellant in this Court raised four
issues for determination, they are:– d
“(a) Was the court below right on hearing the appeal to make
findings of fact in respect of matters on which issues
were not joined by the defendant in the trial court?
(b) Was the court below right in scouting for evidence and e
basing its judgment on inference drawn from such evi-
dence found out by itself which turned out to be specula-
tive without calling on the parties to address it on such
new found evidence?
f
(c) Was the court below right in raising for the defendant as
a ground of appeal that the damages suffered by the
plaintiff was remote and basing its decision against the
plaintiff on the said ground when remoteness of damage
was not put in issue by the defendant in the trial court g
nor specifically raised by the defendant in its grounds of
appeal?
(d) Was the court below right to set aside the order of the
trial court dismissing the counter-claim and to substitute
therefore an order putting the counter-claim back on the
h
cause list for trial?”
The defendant who is now the respondent formulated four
questions for determination in its amended brief. They are as
follows:– i
“(i) Whether the plaintiff proved the contract which formed the
basis of his action against the defendant.
(ii) Whether the failure or neglect of the defendant to commu-
nicate the fact that it had opened a letter of credit to j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 333

a Deutsche Bank until after the close of business on Friday

26/9/86 constitutes an actionable wrong (whether in con-
tract or in tort) on the part of the defendant.
(iii) Whether the Court of Appeal was justified in rejecting or
b
departing from findings or decisions of the High Court on
matters which were not disputed by the defendant and in
particular whether the said Court of Appeal was right in de-
ciding the following questions:
c (a) The date of the publication of the Second Tier Foreign
Exchange Market Decree, 1986 in the Gazette;
(b) Knowledge on the part of the defendant of the provisions
or requirements of the Decree at the time he entered into
d the contract sued upon with the defendant;
(c) The probable time when the documents relating to the
opening of the letter of credit reached the defendant;
(d) Adequacy of the pleading and the evidence relating to
damages; and
e
(e) Remoteness of damages.
(iv) What order should the court below have made on the defen-
dant’s counter claim.”

f In his oral submission the learned Counsel for the appellant,

Mr Anyamene, S.A.N., referred to the pleadings as straight-
forward but that the lower court went on a voyage of discov-
ery and that the court raised issues that were not raised by
g the parties. Learned Counsel pointed out that the respon-
dent’s Counsel appreciated this but that the lower court did
it in the interest of justice. Learned Counsel then referred to
the defence of the respondent which was that the telex mes-
sage was sent on 25th September, 1986 and confirmed that it
h
was received. A defence which according to the Judge’s
findings was false. But that the Court of Appeal came to the
conclusion that the message was sent. Learned Counsel
submitted that immediately Decree No. 23 of 1986 was
i signed on 15th August, 1986 it became law. Learned Senior
Advocate referred to the pleadings filed by the defendant
especially paragraph 14 of the amended statement of de-
fence. Learned Senior Advocate referred to the respondent’s
j brief on admission and submitted that the respondent’s did
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334 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

not make any admission in respect of what they did not a

know about Seismograph Service Nigeria Ltd v. Eyuafe
(1976) 9–10 S.C. 135; (1976) N.S.C.C. Vol. 17 547 and
submitted that the case relied upon by the respondent is b
inapplicable. Learned Counsel had recourse to paragraph 14
of the amended statement of defence and described it as an
undertaking to send and confirm by telex; and that unless the
telex was sent the Deutsche Bank in Frankfurt could not c
have refused to confirm. Mr Anyamene, S.A.N. referred to
page 236 of the record of appeal where the respondent in its
brief in the lower court speculated why the Deutsche Bank
refused to confirm credit, and further stressed that no appeal
d
was filed against the finding by the trial Judge that the telex
was not sent. Learned Senior Advocate referred to paragraph
14 of the amended statement of claim, where the loss sus-
tained was pleaded. He also referred to the observation of
e
Uwaifo, JCA on this issue on pages 317–318 of the record.
On the issue of a contract for foreign exchange the learned
Senior Advocate submitted once the respondent admitted
that they sent the telex there was no need to produce the
f
form filled for the foreign exchange, he referred to para-
graph 19(a) of the amended statement of defence. Learned
Counsel referred to section 15(2)(a) of the 1986 Decree and
concluded by saying that the respondent disabled the
Deutsche Bank from performing. He finally urged that the g
appeal be allowed.
In his own reply, Chief Williams, S.A.N. submitted that
the appellant has failed to prove the foundations of the basis
h
of the case. He referred to paragraph 12 of amended state-
ment of claim. According to the evidence led, the letter of
credit was opened in Lagos on 25th September, 1986 as
exhibit L is dated 25th September, 1986. It is the contention
of the respondent that it is for the Nigerian Bank to arrange i
for confirmation. Appellant only proved that a letter of
credit was opened but failed to prove failure on the part of
the respondent to despatch the telex on 25th September,
1986. Learned Senior Advocate referred to paragraphs 14 j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 335

a and 20 of the amended statement of claim. Then Chief Wil-

liams submitted that failure to communicate cannot cause
loss once the letter of credit is established. He referred to
b paragraph 8 of the amended statement of claim and finally
adopted his brief.
Mr Anyamene, S.A.N. cited these two cases:–
(1) A.E. Ipadeola and another v. Abiodun Oshwole and
c another (1987) 3 N.W.L.R. (Part 59) 18
(2) Salawu Ajide v. Kadiri Kelani (1985) 3 N.W.L.R. (Part
12) 248; (1985) 11 S.C. 124 at 168 and 173.
d It is better to know whether the contract which formed the
basis of this action has been proved. I have set out earlier the
material findings made by the learned trial Judge on this
issue. In their consideration of the issue of the contract the
lower court said:–
e
“Now, it is of utmost importance that if the defendant is to be held
liable in that regard, it must be shown by the plaintiff:
(1) that the defendant did not send the telex on 26th September,
1986 or that it sent it after close of business that day by (sic)
f Deutsche Bank,
(2) that the defendant was aware that Deutsche Bank close their
business at 4p.m.
(3) that Deutsche Bank did not send their confirmation solely
g on the ground that the telex got to Germany after 4 p.m. (i.e.
at 4.20 p.m.).”
I agree. I think what is more important in the above stipu-
lated conditions is that the telex was sent; if the telex was
h not sent at all, the question of getting there late will not
arise. Paragraph 14 of the amended statement of defence
stated categorically and unequivocally that the telex was
sent. That paragraph states, inter alia:–
i “14. . . . the defendant states that the defendant properly commu-
nicated the establishment of letter of credit to the plaintiff’s
Bank on the same day the 25th day of September, 1986 by
telex and there and then requested them to confirm and in-
sisted on cash cover a demand which could not be met be-
j fore 29th day of September, 1986 . . .”
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336 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

By its pleading conditions (2) and (3) laid down for the a
enforcement of a contract between the parties did not arise
again. It must be appreciated that there cannot be a better
notice of the case a party intends to make than his pleading. b
It is a mere notice and can never be substituted for the evi-
dence required in proof of the facts pleaded, subject how-
ever to an admission made by the other party. Unless a party
through skilful cross-examination discredits the case of the
other party, he is still bound to lead evidence in support of c
his own pleading. Once the evidence led is admissible, rele-
vant and uncontradicted and not discredited by cross-
examination, a court can legally rely on it. The defen-
dant/respondent led no evidence nor tendered any document d
in support of its averment. On the contrary, however, the
plaintiff/appellant led evidence that the telex was not sent, it
called two vital witnesses from NITEL (PW1 and 2) to show
conclusively that no message was sent. I prefer to set down e
verbatim the question put to and the answers by PW2 Eze-
kiel Kilanko Olubode, a technician on Telex Overseas Op-
eration and Maintenance of Telex Services in Lagos Zone.
This is limited to exhibit B tendered by consent. Exhibit B is f
the Bill from NITEL in respect of messages sent overseas by
the defendant during the month of September, 1986. The
crucial dates that month in so far as this case is concerned
are 25th and 26th September, 1986. Exhibit B also shows
“itemised bits of messages showing their dates of dis- g
patch”:–
“Q. You have a Bill for September, 1986 meant for A.C.B?
A. Exhibit B is the Bill for telex messages for A.C.B. for
September, 1986. h
Q. It will not be correct to say that exhibit A is an attach-
ment without a Bill?
A. Exhibit B set out in detail the Bill. It explains in details
the calls made and all the particulars.
i
PUT. Message was sent on 25/9/86 to 41414791
A. Based on exhibit B no message was sent on that day.
PUT. On 26/9/86 the called number confirmed that it re-
ceived a message that was sent to it on 25/9/86.
A. It is not possible.” j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 337

a On the evidence of this technician which the learned trial

Judge believed, nobody should be left in doubt that para-
graph 14 of the amended statement of defence already
b quoted above is false. This takes me to what Chief Williams
in his brief referred to as “The Second Contract” and
whether it was proved. Chief Williams relied on what
Uwaifo, JCA said that the application for the letter of credit
c was not tendered and that consequently it was impossible for
the court to determine “all the terms” of the contract. With
respect that is not the case of the parties. The defen-
dant/respondent did not plead ignorance of any contract but
it showed through its pleading that it was aware of the terms
d
and the purpose, if not, why the defendant in paragraph
19(a) and (c) aver as follows:–
“19 (a) In further answer to paragraph 13 of the statement of
claim. The defendant avers that it made it clear to the
e plaintiff that the defendant could not guarantee any line
or lines of credit and that the defendant could not there-
fore be held liable in any manner whatsoever for non
confirmation of the letter of credit. This was initially
f agreed upon between the plaintiff and the defendant and
the agreement was put into writing in a document dated
24th day of September, 1986. The document will be re-
lied upon at the trial of suit.
19 (c) In further answer to paragraph 13 the defendant avers
g that the plaintiff was well aware of the uncertainty at the
time in confirmation of letter of credit. This was why in
plaintiff’s letter dated 24th day of September, 1986 ad-
dressed to the defendant the plaintiff suggested two al-
ternatives to be adopted by the defendant in order to
h achieve confirmation of the letter of credit. This letter
will be found upon at the trial.”
Why did the defendant/respondent fail to tender this letter?
Neither can the defendant be heard to say that the plaintiff’s
i case “as pleaded did not include any allegation that the de-
fendant undertook to communicate the fact that the letter of
credit was opened to the Deutsche Bank before the close of
business on 26/9/86”. In my view the combined effect of
j paragraphs 8 and 9 of the amended statement of claim shows
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338 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

that 26th September, 1986 was the last day the appellant a
could have benefitted under the first-tier exchange market.
In my view, as analysed above, once the telex was not sent,
it follows that the question of confirmation by Deutsche b
Bank did not arise.
There is no doubt that both parties were aware of the rele-
vant Nigerian Law, i.e. Decree No. 23 of 1986, which I had
earlier referred to as SFEM. The relevant provisions which c
relates to the official first-tier market reads:–
“Any transaction covered by a specific import licence in 1985 or
1986 for which a confirmed and irrevocable letter of credit was
established on or before the last day immediately preceding the d
commencement of this Decree must be settled at the rate of ex-
change prevailing at that material date.”
Chief Williams seems to concentrate on “confirmed and
irrevocable letter of credit” without adverting to the steps to e
be taken before the irrevocable letter of credit should be
confirmed. The confirming bank, in this case Deutsche
Bank, must receive a notification from the defendant, i.e. the
issuing bank, before it can confirm. You can only confirm
f
once there is a request. The telex which ought to convey the
request was not sent; this is the case of the appellant. This to
my mind was why the defendant/respondent averred in
paragraph 12 of the amended statement of claim thus:–
g
“12. The defendant admits:
(a) that the Second Tier Foreign Exchange Market (SFEM)
was to come into effect on the 29th day of September,
1986.
(b) that only confirmed letters of credit which were con- h
firmed on or before the 29th day of September, 1986
could be transacted under the First Tier Foreign Ex-
change system.
(c) that the Second Tier Exchange Market is costlier than i
the First Tier in the rate of the Naira Exchange for other
world currencies. It is also true that most banks and im-
porters were striving to beat the date line. But the defen-
dant in spite of the short time it had to scale through and
the unprecedented rush on the Bank the Defendant j
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Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 339

a succeeded in establishing a letter of credit with the

confirming Bank in West Germany being the Deutsche
Bank of Frankfurt on the 25th day of September, 1986.
The defendant will found upon a copy of the telex dated
b the 25th day of September, 1986 which was tested and
found received on the following day the 26th day of Sep-
tember, 1986.”

c I will repeat again that it has been proved to be false, the

averment that the telex was sent. I agree with Mr Anyamene,
S.A.N. in his oral submission that, unless the telex was sent,
the Deutsche Bank could not have refused to confirm any
letter of credit. I cannot therefore accept the submission of
d
Chief Williams that the appellant has failed to prove the
defendant’s failure to despatch the telex on 25th September,
1986 or on any date before 29th September, 1986.
e The finding in this issue was not challenged on appeal
(Ipadeola and another v. A. Oshowole and another (1987) 3
N.W.L.R. (Part 59) 18; (1987) 5 S.C 376/378; Salawu Ajide
v. Kadiri Kelani (1985) 3 N.W.L.R. (Part 12) 248 (1985) 11
f S.C. 124 at 168 and 173).

In the lead judgment of Uwaifo JCA the learned justice

after citing authorities on delegated legislation and on when
a delegated legislation “should ideally come into effect”
g
said:–
“I do not intend to say more than that. So in fact it could have at
best been a matter of speculations as to when the Decree would
h indeed come into operation at the time the defendant was making
effort over the confirmation of the LC. It is, in my view, a grave
matter to attempt to saddle the defendant with liability in the cir-
cumstances of the publication of that order . . . It is most likely that
PW3 travelled to Lagos on 24th September, as given in evidence
i by him in the company of one Njemanze, an official of the defen-
dant bank ‘with all the relevant documents’ which were delivered
to the Defendant Bank’s Lagos office . . . It seems fair view to take
that the plaintiff’s 3rd witness most probably proceeded to Lagos
after he got exhibit L on 25th September, and that he might have
j arrived there that day.”
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340 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

With respect there was a lot of surmise on the part of the a

lower court about what happened. No doubt the court was
led into this after trying to make a case not based on the
evidence yet to be given by the defendant/respondent in this b
appeal. If the evidence had been duly considered and con-
sideration given to the findings of the trial court, there
should not have been any need for the “discovery” embarked
upon by the lower court. No court has a right to force a party c
to give evidence. After both parties to dispute had been duly
notified of the hearing date and a party for no justifiable
reason decides to, so to say, opt out of the proceedings, the
case presented by either party once it is not discredited in
d
any legal way should be the case to be considered on its
merits. The intention of the other party when it refuses to
take part is no business of the court. This situation is differ-
ent from a position taken by a party who announces not to
call evidence in view of the evidence led by the other party. e

In summarising the plaintiff’s/appellant’s claim, Chief

Williams in his brief said:–
“The only ground on which the plaintiff rested his claim in this f
action was that the defendant was responsible for this failure (fail-
ure that the Deutsche Bank failed to confirm the credit) because he
failed to communicate in time with Deutsche Bank. There is no
valid legal or factual basis for the claim.”
g
Learned Counsel then agreed with the criticism of the lower
court about the visit to Lagos by PW3 and evidence relating
to the time business closed on the last day, i.e. 26th Septem-
ber, 1986. As said earlier the criticisms on which this sub- h
mission is based missed a point of contention which is
whether the telex was sent or not and once it was proved and
found by the Judge that it was not sent, this Court will, in the
absence of any contrary evidence accept that finding.
i
In summary I will hold that there has been a breach of the
contract for which the defendant/respondent is liable.
I now come to the issues of damages. The lower court per
Uwaifo JCA said:– j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 341

a “If I were however to hold the defendant liable, the amount of

damages would have been the cost of buying foreign exchange
from the First and Second-Tier Foreign Exchange Markets in re-
spect of later financing the said Letter of credit.”
b
I agree. The learned justice of the Court of Appeal explained
it better when later in his judgment he said again:–
“Therefore all it could hope to get in an action like this, as an al-
ternative to the difference computed in Naira between the cost of
c buying foreign exchange from the First and Second-Tier Foreign
Exchange Markets as I earlier said in this judgment, if properly
asserted and proved as a necessary consequence of that loss of
opportunity, would have been a loss of profit and no other.”
d In assessing damages one must inevitably look at the claims
filed and as set out in paragraphs 21–27 of the amended
statement of claim already reproduced above. In claim 2(a)
the damages suffered were due to the failure of the defen-
e dant to send telex.
In his evidence concerning the failure to beat SFEM PW3
said:–
“When I failed to beat SFEM, the defendant asked me to utilise the
f money in bidding for the Second Tier and whatever losses I sus-
tain would be taken care of.”
The plaintiff/appellant in paragraph 12 of the amended
statement of claim pleaded this loss. The relevant part of
g paragraph 14 reads:–
“. . . The difference in the price of the goods between the first and
second tiers cause a loss of N1,697,800 to the plaintiff”.
Particulars of Loss
h Item 1st Tier 2nd Tier Loss Amount
1. Super 1915m/tons 806m/tons 1109m/tons
White 22180 (50kg)
Cement bags at
N70
i each bag N1,552,600
2. Bayer 24,625kos 9,500kos 15125kos
(Iron) or 605 (25kg)
at N240
each bag N145,200
j N1,697,800
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
342 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The defendant/respondent in answer to this paragraph 20 of a

the amended statement of defence averred:–
“Paragraph 14 of the Statement of Claim. The defendant is aware
that the Deutsche Bank refused to confirm the letter of credit be- b
fore the 29th day of September, 1986 denying the plaintiff the op-
portunity of benefitting from the First Tier Foreign Exchange
Market. But the defendant denies being responsible for the loss of
the opportunity or being negligent, reckless or careless in any
manner whatsoever in the defendant’s handling of the plaintiff’s c
letters of credit, or at all. The defendant further denies being re-
sponsible for the loss of charges suffered by the plaintiff as a result
of which the plaintiff missed the First Tier Foreign Exchange Mar-
ket.” d
In view of the conclusions reached, I will grant this loss well
calculated and proved.
I now come to the other special damages cited as itemised
e
on page 175 of the Record of Appeal. These are based on
claims 2(b) and 2(d):–
2(b) – I do not see how this can give rise to any special
damage, the complaint is in respect of the bank interest. f
No where had it been alleged that the failure to pay the
loan which in any way must attract interest was due to
any fault as such. A claim for general damages may have
been considered. I will disallow the items based on this. g
2(c) and 2(d) have not been established, exhibit G, i.e.
letter dated 19th September, 1986 laid down certain and
specific conditions which must be met and there was no
evidence led to show these conditions were met. For in- h
stance, condition (7) is clear and unambiguous:–
“7. Costs of joint control of goods e.g. warehousing, and
other charges however incurred in respect of the security
of the goods will be borne by our company.” i
Not a word was said about this in the evidence before the
lower court. It appears to me therefore that claims (iii), (vi)
cannot be maintained. Whereas claim (vii) is speculative. On
the whole, I will dismiss those claims referred to as special j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 343

a damages. There will be judgment in favour of the plain-

tiff/appellant for the sum of N1,697,800 (One Million, Six
Hundred and Ninety-seven Thousand, Eight Hundred Naira
b only) being the difference in the price of goods between the
first and second tier markets.
I now come to the counter-claim. Counter-claim is a cross
action. This must be proved. At the hearing, and in fact in
c the middle of the trial, the defendant completely withdrew
from further participation. The case suffered several ad-
journments. To appreciate the levity with which the defen-
dant treated the proceedings, I reproduce below the
proceedings of 21st March, 1989 up to the time Mr An-
d yamene, SAN closed the case for the plaintiff and addressed
the court:–
“Plaintiff present by Victor Kanayo Obikwe, defendant absent. Mr
A.N. Anyamene, SAN (Miss N.N. Owoh with him) for the plain-
e tiff. No counsel appears for the defendant.
Mr Anyamene: This suit came up today. It is so in order that the
defendants should be served with the Amended Statement of
Claim and also for them to cross-examine the last witness for the
f plaintiff. On the 14/3/89 both Amended Statement of Claim and
hearing notice were served on the defendant personally. Time of
service was 12.30 noon of the said date. We obtained a certified
true copy of the affidavit of service by the bailiff. I tender the affi-
davit of service – received and marked Ex. U. The defendant is not
g here and no counsel appears for him. In the circumstances I urge
the Court to apply Order 24 Rule 13 of the High Court Rules and
proceed with the hearing of the case. This is the third hearing no-
tice served on the defendant and yet the defendant has consistently
absented itself. No indication from the defendants that they have
h any intention to defend the suit. I say so because only yesterday
20/3/89 defendant failed to obtain an interim order from the Court
of Appeal to stop hearing of this case. The defendant’s motion to
that effect at the Court of Appeal is CA/E/31M/89. I informed the
Court of Appeal that this case will go on today and the counsel Mr
i
E.C. Ibe heard me when I announced that the case will go on. Mr
Ibe had appeared for the defendant in this Court up to the 7/3/89.
Ruling: Hearing of this suit now proceeds.
Mr Anyamene: I close plaintiff’s case. And now address the
j Court.”
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Olatawura JSC
344 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

Where a plaintiff or a defendant who files a counter-claim a

abandons his claim without leading any evidence the proper
order to make is to strike out the case or the counter-claim.
The learned trial Judge was wrong to have dismissed the b
counter-claim. While agreeing with the lower court that the
counter-claim was wrongly dismissed, no reason was given
by the lower court for ordering that the counter-claim be
restored “on the cause list for normal trial”. I cannot, with
respect agree with Mr Anyamene, S.A.N. that “a trial court c
is bound to give its reasons for dismissing a claim aban-
doned by the claimant”. If that dismissal is meant to be, and
in fact should be, a judgment of the court, reasons must be
given. It is not for the appellate court to speculate why a d
case was dismissed, non suited or struck out. The reason for
doing so must appear on the record of the lower court. It is
not a case of discretion as canvassed by the appellant, it is in
the interest of justice that a party should know why he has e
lost or won a case. The administration of justice requires
proof of any claim or counter-claim and not surmise or con-
jecture. Chief Williams, S.A.N. is right in his submission
that “a Court of justice ought to be very slow to give final f
judgment in an action or counter-claim when it is aware that
there has been no trial on the merits”. But I disagree that it is
for that reason that the court below ordered that the case be
put back on the cause list. No court should force a party to
proceed with a claim abandoned. In the final analysis the g
counter-claim will be and is hereby struck out.
The appeal has succeeded in part. Costs of this appeal are
assessed at N1,000 in favour of the appellant.
h
KAWU JSC: I have had the advantage of reading, in draft,
the lead judgment of my learned brother, Olatawura JSC,
which has just been delivered. I am in complete agreement
with his reasoning and also with his conclusion that this
i
appeal ought to be allowed. The lower court was definitely
in error when it came to the conclusion that there was no
contract between the parties when the parties in their plead-
ings agreed that there was. In paragraph 8 of the amended
statement of claim, the appellant pleaded as follows. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Kawu JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 345

a “On the 19th of September, 1986, the defendant undertook the

duty to establish an irrevocable letter of credit for the importation
of the said raw materials as specified in the proforma invoice No.
N/1084A/86 of 8th August, 1986, from KLOSA and STASS, and
b in consequence took possession of the original proforma invoice of
KLOSA and STASS.”
This was admitted by the defendant in paragraph 11 of the
amended statement of defence where it averred thus:–
c “11. The defendant admits paragraph 8 of the statement of claim
to the extent only that in its normal course of duty com-
menced to establish irrevocable letter of credit on satisfying
itself that the preliminary requirements for opening irrevo-
d cable letter of credit such as the fund, and the proforma in-
voice have been met, by the plaintiff.”
Furthermore there was the evidence of PW3, the managing
director of the plaintiff company, which evidence was be-
e lieved by the learned trial Judge. There was also overwhelm-
ing evidence that the defendant failed to perform its own
side of the contract and, that being the case, in my view, the
learned trial Judge was right in finding the defendant liable
in damages for breach of contract.
f
For the above reasons, and for the fuller reasons set out in
the lead judgment of my learned brother, Olatawura JSC. I
too will allow the appeal. I abide by all the orders made in
the lead judgment including the order as to costs. I will also
g strike out the defendant’s counter-claim which would appear
to have been abandoned.
WALI JSC: I have had the privilege to read in advance a
copy of the lead judgment of my learned brother, Olatawura
h JSC. I entirely agree with his reasoning and conclusion that
the appeal has merit and must therefore be allowed in part.
On the pleadings and the evidence adduced in this case,
there is a binding contract between the plaintiff/appellant
i
and the defendant/respondent where the latter agreed to open
a confirmed letter of credit for the former to enable him
benefit under the first-tier market which would cease to
operate from 28th September, 1986 (see paragraphs 6, 7, 8,
j 9, 10, 11, 12 and 13 of the amended statement of claim). The
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
346 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

defendant/respondent however failed to establish an irrevo- a

cable and confirmed letter of credit with the Deutsche Bank
in Western Germany. This was confirmed by PW2 who
described himself as “a technical man on telex and also b
overseas operation and maintenance of telex services in
Lagos Zone” when he testified under cross-examination by
the respondent as follows:–
“Q. In Exh. B what is the call number of the message sent on c
26-9-86?
A. It is 41414791.
Q. You raise the Bill coupled with attachment?
A. I agree.
d
Q. You raise the bill and attachments on zonal basis?
A. I do not agree it is centralised.
Q. You have the bill for September, 1986 meant for
A.C.B.?
e
A. Exh. B is the bill for the telex message for A.C.B. 1986.
Q. It will not be correct to say that Exh. A is an attachment
without bill?
A. Exh. B set out in detail the bill. It explains in detail the
calls made and all the particulars. f
PUT: Message was sent on 25/9/86 to 4/4/91.
A. Based on Exh. B no message was sent on that day.
PUT: On the 26/9/86, the called number confirmed that it
received a message that was sent to it on 25/9/86. g
A. It is not possible.”
This evidence goes to confirm the averment in paragraph 13
of the amended statement of claim that no telex was sent to
the Deutsche Bank to confirm the letter of credit purported h
to have been opened by the defendant/respondent in favour
of the plaintiff/appellant.
It is clear from the evidence of the plaintiff/appellant and
his pleadings that time was of the essence in the contract i
(see paragraph 11 of the amended statement of claim). Sec-
tion 15 of the Second-tier Foreign Exchange Market Decree
No. 23 of 1986 which both parties referred to and relied
upon in their pleadings, strengthens the plaintiff/appellant’s j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 347

a case that the time in this particular contract transaction is of

essence, when it provides that
“15(2) The official First Tier Market transaction referred to
b in sub section (1) are as follows:–
(a) any transaction covered by a specific import
licence issued in 1985 or 1986 for which a con-
firmed and irrevocable letter of credit was estab-
lished on or before the last day immediately
c preceding the commencement of the Decree.”
The defendant/respondent admitted in paragraph 12(a) of the
amended statement of defence that the provisions of the
Decree would come into effect on 29th September, 1986 as
d pleaded by the plaintiff/appellant. It is trite that what is ad-
mitted does not require evidential proof. It is also to be
noted that the mere opening of the letter of credit by the
defendant/respondent “without following the necessary steps
e to make it confirmed and irrevocable with the Deutsche
Bank of Western Germany as agreed to between the parties,
did not bring the said letter of credit” within the ambit of
section 15(2) of the SFEM Decree No. 23 of 1986. The
f findings of the learned trial Judge that the defendant’s/
respondent’s attitude in not sending the telex message time-
ously to the Deutsche Bank in West Germany was nothing
short of “gross irresponsibility and negligence” is justified.
g By reason of this breach which forced the plaintiff/appellant
to bid for foreign exchange on the second-tier market to
import goods for which the letter of credit was opened, thus
forcing him to pay more in terms of local currency, he sus-
h tained the loss particularised under paragraph 14 of the
amended statement of claim and which are as follows:–
Item 1st Tier 2nd Tier Loss Amount
1. Super 1915m/tons 806m/tons 1109m/tons
White 22180(50kg) bags
i Cement at N70
each bag N1,552,600
2. Bayer 24,625kos 9,500kos 15125kos
(Iron) or 605(25kg)
at N240 each bag N145,200
j N1,697,800
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Wali JSC
348 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

The loss was proved by the plaintiff/appellant and the award a

of the same to him by the learned trial Judge is hereby af-
firmed. It is to be noted that the defendant/respondent did
not call any evidence in support of his pleadings. Where a b
banker is found liable for breach of contract to open a con-
firmed and irrevocable letter of credit, the measure of dam-
ages is that which it could reasonably have been foreseen
would flow from such a breach. In the present case the de- c
fendant/respondent was aware that failure by it to confirm
the letter of credit with Deutsche Bank would force the
plaintiff/appellant to resort to the second-tier market which
was costlier, thus causing him the loss in terms of Naira, as
d
itemised in his particulars to paragraph 14 of the amended
statement of claim. This loss was proved by the plain-
tiff/appellant and the award of the same to him by the
learned trial Judge is affirmed.
e
As for the rest of the remaining other claims, they have
either not been proved or are purely speculative as found by
the Court of Appeal.
f
It is for these and the more detailed reasons contained in
the lead judgment of my learned brother, Olatawura JSC,
and which I hereby adopt as mine, that I too will allow the
appeal. The appeal succeeds in part and it is allowed. The g
award of N1,697,800 to the plaintiff/appellant as special
damages by the trial court is hereby affirmed. I abide by the
remaining consequential orders, including orders as to cost,
contained in the lead judgment. h
OMO JSC: I have had a preview of the judgment just deliv-
ered by my learned brother, Olatawura JSC, and I agree with
his conclusion that this appeal be allowed on the terms set
out therein. I am also in agreement that the appropriate order i
to make in respect of the counter-claim of the defen-
dant/appellant is one striking same out and not dismissal as
ordered by the trial court, or placing same back on the cause
list of the High Court as ordered by the court below. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 349

a The plaintiff/appellant claimed from the defendant/

respondent the sum of N22,605,357 as special and general
damages resulting from breach of contract under four sepa-
b rate, though inter-related, heads of claim, which are fully
set out in the lead judgment, and will therefore need no
repetition here. It is the plaintiff in a case who sets out what
he is claiming and his success or failure must be decided on
c the basis of his claim(s). It is not the duty of the court to
make out a different case for him. The first head of claim
numbered (a) relates to the contract between the parties
which began with the plaintiff’s/appellant’s application for a
loan to service import licence under the first-tier foreign
d
exchange market (FEM), and ended with the failure of the
defendant/respondent to carry out its undertaking to open an
irrevocable letter of credit on behalf of the plaintiff, and
ensure its confirmation by the Deutsche Bank of West Ger-
e many, before the Second-Tier Foreign Exchange Market
(SFEM) Decree came into effect on 29th September, 1986.
The second head of claim (b) is confined to the loss alleg-
edly resulting from the failure of the defendant/respondent
f bank to ensure that the plaintiff/appellant succeeded in his
bid for the purchase of foreign exchange (BID/10) under
SFEM which took place on 25th November, 1986 after the
defendant/respondent had completed all that was required of
g him to ensure a successful bid. The third head of claim, (c),
deals with an alleged breach of contract occasioned by the
delay of the defendant/respondent in opening letters of credit
to enable the plaintiff/appellant to import materials required
h for his factory, soonest. Although the bid for purchase of
foreign exchange under SFEM (BID 12) did not succeed on
11th December, 1986, letters of credit were not opened until
24th February, 1987 (a period of almost ten weeks). The
i fourth head of claim (d) cover losses arising from alleged
failure of the defendant/respondent to make funds available
to clear the goods when they eventually arrived at Port Har-
court for a period of four months (May/September, 1987).
j The plaintiff/appellant was therefore forced to pay very
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
350 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

heavy demurrage and storage charges. All these heads of a

claim, though separate, are inter-related because they have
their genesis from the application made by the plain-
tiff/appellant to the defendant/respondent for a loan to en- b
able him to import materials for the manufacture of multi-
coloured cast stone bricks in his factory at Enugu.
In the High Court, only the plaintiff/appellant led evidence,
calling three witnesses – its managing director, Victor c
Obiekwe (PW3), and two Nitel officers from Lagos (PW1
and PW2). The defendant/respondent was represented by
Counsel until midway through evidence of PW3, when
Counsel originally representing it sought leave to withdraw d
which was granted. Counsel who appeared thereafter con-
fined their activities/appearances, no doubt on the basis of
instruction given them, to very spirited efforts to ensure that
the case was not completed by the learned trial Judge e
(Ozobu J as he then was); applying unsuccessfully for the
case to be heard de novo by another Judge. On failing to
achieve this objective the defendant/respondent abandoned
its defence of the claim which proceeded to conclusion in its
f
absence. The most important and unfortunate result of this
behaviour is that PW3 who was mainly involved with the
defendant/respondent in the several transactions on which
the claim was based, was not subjected to cross-
examination. His evidence therefore, unless very obviously g
false, cannot be challenged as the defendant/respondent
sought to do on appeal. It was also responsible for the varied
speculations and “voyages of discovery” that the court be-
low slipped into its judgment, as will be shown anon. h
The case of the plaintiff/appellant, briefly stated, is that he
applied to the defendant/respondent for a loan to enable it to
import super white cement and Bayerferrox (iron) oxides for
the manufacture of multi-coloured concrete cast stone bricks i
in its factory at Emene, Enugu State, after obtaining an im-
port licence to import same under the first-tier foreign ex-
change market (FEM). It was part of the contract between
the parties that the defendant/respondent was to open a letter j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 351

a of credit in favour of the exporting company Klosa and

Staas of Germany, and to inform the confirming bank in
Germany, Deutsche Bank, of its issuance, so as to enable it
b confirm the irrevocable letter of credit before 29th Septem-
ber, 1986, when the FFEM would cease to operate and
SFEM came into operation. On that event occurring, the
import licence, nominated as it is for use under FFEM,
c unless utilised, would be valueless. To meet this require-
ment, PW3 testified to taking all steps required of him to
enable the defendant/respondent to meet this essential term
of the contract. Unfortunately, the defendant/respondent sent
the information about the letters of credit late to the con-
d
firming bank, which was therefore not able to confirm same
before SFEM came into operation. As a result of this failure
it had to purchase foreign exchange under SFEM at greatly
increased cost, resulting in a loss of N1,697,800 at that ini-
e tial stage. According to PW3 the defendant/respondent
agreed to absorb this extra cost. Two bids were made by the
defendant/respondent on behalf of the plaintiff/appellant to
purchase foreign exchange under SFEM. The first (BID/10)
f on 25th November, 1986 was unsuccessful, because of the
negligent failure of the defendant/respondent to whom the
necessary funds had been made available in time. The sec-
ond (BID/12) on 11th December,1986 succeeded, but letters
g of credit were not opened until 24th February, 1987, thus
leading to further loss arising from delay in importation. The
goods then arrived at Port Harcourt on 12th May, 1987.
Despite all entreaties to make money available to clear the
h goods, the defendant/appellant failed to release any funds
until 24th September, 1987. As a result the plaintiff/
appellant was forced to borrow from banks and other finance
establishments to settle heavy demurrage/clearance charges,
i in order to prevent the imported items from being sold by
auction. Further loss was occasioned by having to store
some of the items in a hired warehouse. Finally PW3 testi-
fied that as a result of all the delays occasioned, products
j which could have been manufactured for sale were not so
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
352 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

manufactured. This occasioned further loss. The plain- a

tiff/appellant therefore claimed a sum of N22,650,357 as
special and general damages. PW1 and PW2 gave evidence
of the telex facilities given to the defendant/respondent in b
Lagos, with PW2 stating unequivocally under cross-
examination by defendant’s/respondent’s Counsel, that the
defendant/respondent did not send any telex message on
25th and 26th September, 1986. c
Although the defendant/respondent did not lead evidence,
its main defence, as shown by its pleadings (and cross-
examination), to the first head of claim, is that it fulfilled its
obligation to inform Deutsche Bank of the issuance of the d
letter of credit in favour of Klosa and Stass on 25th Septem-
ber, 1986, and that receipt of this message was confirmed to
it on 26th September, 1986. Deutsche Bank however refused
to confirm the letter of credit on the ground that it required e
cash backing for it. This averment was pleaded in paragraph
7 of the amended statement thus
“7 . . . But the same Deutsche Bank turned and declined to
confirm the credit so established by the defendant and in- f
sisted that a cash cover must be made. The development
was promptly communicated to the plaintiff in the defen-
dant’s letter dated the 9th of October, 1986 which letter will
be founded upon at the trial of this suit. The Plaintiff is
hereby given notice to produce the said letter at the trial of g
this suit” (italics mine).
Since the defendant/appellant did not testify and/or PW3
cross-examined by its Counsel, no such letter was produced
h
or other evidence led in proof of this crucial averment. With
regards to the other three heads of claim, the defence as
revealed by the pleadings is that the alleged losses claimed,
if any, were the fault of the plaintiff/appellant. Contrary to
his contention, its failure in Bid 10 (second head of claim) i
was due to its not filling a proper bid application form, de-
spite various reminders. Delay in opening a letter of credit
after successful Bid 12 was denied (third head of claim). On
the fourth head of claim, defendant/respondent pleaded in j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 353

a complete defence of paragraph 7 of the defendant/

respondent’s letter dated 19th September, 1986 which ap-
proved the original loan, exhibit G, and which provides that
b the plaintiff/appellant should bear the cost of “warehousing
and other charges, however incurred in respect of the secu-
rity of the goods”. Generally on the alleged delay between
the successful Bid 12 and the approval of money for clearing
the goods, the defendant/respondent pleaded that the process
c of applying for and approval by its Lagos headquarters of-
fice of the further loan of N110,454 applied by the plain-
tiff/appellant, which was not to be granted as of course it
was not partly responsible for the “delay” complained of.
d The defendant’s/respondent’s counter-claim is for the sum
of N2,276,620.61 being an overdraft with compound interest
granted to the plaintiff/appellant by it at the plain-
tiff’s/appellant’s request as at 31st December, 1986. The
e payment of compound interest at the rate of 15% per annum
“with monthly rests” until judgment is given, was also
claimed.
After hearing the address of the plaintiff’s/appellant’s
f Counsel, the learned trial Judge in a reserved judgment
carefully set out and reviewed the pleadings and evidence
led. He then appraised same and made several findings of
fact, before considering and deciding the legal issues raised.
g Finally he gave judgment for the plaintiff/appellant in the
sum of N10,827,305.25 with N4,000 costs against the de-
fendant/respondent. Some of the most important findings of
fact made by the learned trial Judge are as follows:–
h (1) That time is of the essence of the contract between the
parties, to wit, the opening of the letter of credit and
communicating same to the confirming bank before
coming into effect of SFEM.
i (2) That PW3 is a witness of truth whose evidence is largely
unchallenged. Specifically believed were:–
(a) His version of events between him and the defen-
dant’s/respondent’s servants on 25th and 26th Sep-
j tember, 1986; particularly the fact that the issuance
[1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
354 Nigerian Banking Law Reports [1990 – 1993] 5 N.B.L.R.

of the letter of credit was not communicated to a

Deutsche Bank on 25th September, 1986 as
“pleaded” by the defendant/respondent; and that as a
result b
(b) Deutsche Bank could not confirm the letters of
credit to enable the import licence be utilised under
FFEM.
(3) That the plaintiff/appellant was therefore forced to buy c
foreign exchange under SFEM at a much higher rate of
exchange, thus incurring considerable loss.
He then found the defendants “responsible for the loss suf-
fered by the plaintiff as a result of which the plaintiff missed d
to import under the first tier foreign exchange market”. The
judgment amount ordered included.
(a)N 1,697,800 being loss from purchase under
e
SFEM instead of FFEM.
(b)N 8,570,215 loss of profit.
(c) N 659,806.25 losses occasioned by late clearance
of goods ordered. f
N10,617,811.25
The defendant/respondent was dissatisfied with the judg-
ment of the trial court and so appealed to the Court of Ap-
g
peal against same. Briefs were duly filed in the lower courts
by the parties and the following four issues were set out for
determination:–
“(i) Whether the plaintiff/appellant has successfully proved
contract on which he founds his claim in this action i.e. the h
contract whereby the defendant bank agreed to open a con-
firmed irrevocable letter of credit at his (plaintiff’s) request
in favour of KLOSA and STASS.
(ii) Whether the plaintiff’s case that the Deutsche Bank refused i
to confirm the credit issued by the defendant bank solely
because of the fact that the credit was so issued was not
communicated to KLOSA and STASS on 26/9/86 was valid
and was the one upon which the court below entered judg-
ment in its favour. j
 [1990 – 1993] 5 N.B.L.R. (SUPREME COURT OF NIGERIA)
Omo JSC
Obimiami Brick and Stone (Nig.) Ltd v. African Continental Bank Ltd 355

a (iii) Whether, even if the plaintiff is entitled to damages, there is

any rational or legal basis for the award made by the court
below in this case.
(iv) What order should the court below have made on the defen-
b
dant’s counter-claim.”
In reversing the judgment of the trial court, the court below,
inter alia, held that the only and “true agreement or con-
c tract” between the parties is restricted to the establishment of
an irrevocable letter of credit for the importing of the manu-
facturing items set out in the import licence, and that the
defendant/respondent (appellant before it) performed that
contract. Paragraph 8 of the amended statement of claim was
d relied on in so finding. In its view, the confirmation of the
letter of credit and/or confirming same before 29th Septem-
ber, 1986 were subsequent issues which rose later and are
extraneous to the contract established by exhibit G, the letter
e setting out the c