BLESSED INNOMA ENT. NIG. LTD. & ANOR V. UNION BANK OF NIGERIA PLC.
(2013)LCN/6278(CA)
In The Court of Appeal of Nigeria
On Monday, the 10th day of June, 2013
CA/E/240/2005
JUSTICES
MOJEED ADEKUNLE OWOADE Justice of The Court of Appeal of Nigeria
ISAIAH OLUFEMI AKEJU Justice of The Court of Appeal of Nigeria
EMMANUEL AKOMAYE AGIM Justice of The Court of Appeal of Nigeria
Between
1. BLESSED INNOMA ENT. NIG. LTD.
2. INNOCENT C. UKPABIA Appellant(s)
AND
UNION BANK OF NIGERIA PLC. Respondent(s)
RATIO
THE KEY ELEMENT OF THE TORT OF NEGLIGENCE
The tort of negligence including bankers negligence presupposes (i) duty of care (ii) breach of duty (iii) resulting consequential damages.
See Makwe v. Nwukor (2001) 6 M.J.S.C. 179. PER OWOADE, J.C.A.
MOJEED ADEKUNLE OWOADE J.C.A. (Delivering the Leading Judgment): This is an appeal against the judgment of C.E. Iyizoba J. in the Onitsha Judicial Division of the Anambra State High Court of Justice sitting at Otuocha delivered on the 18th day of July 2005.
The Plaintiffs/Appellants claim against the Respondent crystalised in their further Amended Statement of Claim dated and filed on 27/4/2004.
Paragraph 19 of the said Plaintiffs/Appellants pleading aver thus:
19. Wherefore, the Plaintiffs claim from the Defendant as follows:
(a) An order of court restraining the Defendant or her agents from exercising her right of lien in respect of the security held for this facility which is the property located at 233 Works Layout Owerri, Imo State pending the determination of the suit.
(b) Immediate refund to the Plaintiffs of the sum of Eight hundred thousand naira (N800, 000.00) being lodgement made by the 2nd plaintiff into the Plaintiff’s account number 00024/01 090 with the Defendant’s bank.
(c) A declaration that the Plaintiffs are not indebted to the Defendant bank in the sum of five hundred and fourteen thousand, eighty naira, seventy two kobo (N514, 080.72) as contained in the Defendant’s letter dated 4/6/93 or any amount at all.
(d) A declaration that the Defendant is not entitled to charge more than the agreed interest rate of 29.5% without the mutual agreement of both parties.
(e) A declaration that the Defendant is not entitled to operate or juggle with the 1st Plaintiffs account number 00024/01 090 without the authorization of the Plaintiffs.
(f) N10,000.000.00 (Ten million naira) general damages for unlawfully tampering or juggling with the 1st Plaintiff’s account aforesaid without the consent of the Plaintiffs and for injuries suffered in consequence thereof.
By its Amended Statement of Defence dated 8/4/1994 and filed on 14/4/94, the defendant contend that the Plaintiffs/Appellants are not entitled to the reliefs claimed and urged a dismissal of the Plaintiffs/Appellants suit.
The facts of the case are as follows: The 1st Appellant, a Limited Liability Company of which the 2nd Appellant is its Managing Director maintained an account for its business with the defendant bank at its New Market Road Onitsha Branch. By an offer letter admitted in evidence as Exhibit B, the Respondent bank granted the 1st Appellant an overdraft facility of N250, 000.00 under terms and conditions stated therein. In particular, the Plaintiffs claimed the rate of interest agreed was 29.5%. As security for the facility, the 2nd Appellant’s property situate at Plot 223 Work Layout Owerri was mortgaged to the Respondent. The deed of legal mortgage was admitted in evidence as Exhibit A.
When the Appellants received the statement of account for September and October, 1992, they noticed some irregularities.
For example, a cash deposit of N100,000.00 credited to the Appellant’s account of 29th of September 1992 was reversed to debit. A cash lodgment of N300,000.00 was on record on 30/11/92 and reversed to debit on 1/12/92.
Again, on 30/12/92, the Appellant was credited with the sum of N400,000.00 which was again reversed to debit on 1/2/93.
The Appellants claim that these sums, total of N800,000.00 were paid into the account personally by the 2nd Appellant.
Appellant claimed that the tellers and other banking documents were stolen by armed robbers on the 28th of July 1993. The Respondent wrote several letters demanding that the Appellants should pay the sum N514, 080.72 being the outstanding balance of his overdraft facility and that if he did not pay within a specified period, steps would be taken to realize the security held for the overdraft”. The Appellants claimed no such amount is owed.
The Respondent, on the other hand claimed inter alia that the credit entries of N100,000.00, N300,000.00 and N400,000.00 were erroneously passed by their computer clerk.
The entries were accordingly reversed on the discovery of the errors. The Appellants were duly informed of the reversal. The Respondent denied the loss of the Appellants tellers and other bank documents to armed robbers since the Appellants did not report the loss to the Respondent as required by banking practice. The Respondent alleged that the claim was a mere after thought to cover for their inability to produce evidence of the lodgment of the sums totaling N800,000.00.
In proof of their case, the 2nd Appellant gave evidence and called one other witness.
The sole witness for the Defendant/Respondent, Eme Linus Uka, gave evidence as DW1.
After the review of evidence and submissions of counsel, the learned trial judge held inter alia at page 174 of the record that:
“I am satisfied that the Plaintiffs have failed to adduce credible evidence that the 2nd Plaintiff lodged into the account of the 1st Plaintiff the total sum of N800,000.00. I am also satisfied that the reversal of the erroneous entries were not unlawful. It is understandable that such error could occur once but to have occurred repeatedly creates the impression of crass incompetence, at best, or at worst, deliberate manipulation of the Plaintiffs account in order to create room for fraud. The attempt by the plaintiffs to capitalize on this sorry state of affairs created in the bank by unscrupulous and negligent stall I am afraid, cannot succeed.
The web or lies strewn by the Plaintiff in this attempt turned out too weak and too obvious to sustain their case”.
And finally, at pages 175 – 176 of the record, the learned trial judge concluded thus:
“In the circumstances, I hold that the Plaintiffs have failed to substantiate their claims that the 2nd Plaintiff lodged the sum of N800,000.00 into the 1st Plaintiffs account No. 00024/01090 at Universal Trust Bank of Nigeria, New Market Road Onitsha. They have also failed to satisfy me that the defendant is not entitled to charge more than 29.5% interest on the facility granted to them. The Plaintiffs failed to prove that they suffered any injury entitling them to any damages. This case is therefore bound to be dismissed and it is hereby dismissed”.
Dissatisfied with the judgment, the Plaintiffs/Appellants filed a Notice of Appeal (containing seven grounds of appeal) in this court on 25/7/2005. By order of this Honourable Court, the Appellants filed a further Amended Grounds of Appeal (containing only six (6) grounds of appeal) and dated 19/5/20l0 on 18/4/2013.
The relevant briefs of argument are the:
(i) Amended Appellants brief filed on 19/5/2010 but deemed filed on 9/11/2010.
(ii) Amended Respondent’s brief of argument dated 17/11/2010 but filed on 22/11/2010.
(iii) Amended Reply to the Respondent’s brief filed on 19/5/2010 but deemed filed on 9/11/2010.
Learned counsel for the Appellants nominated three (3) issues for determination namely:
1. Whether the learned trial judge was right in holding that the Plaintiffs/Appellants failed to prove that the sum of N800,000.00 was lodged by the 2nd Plaintiff/Appellant into the 1st Plaintiff/Appellant account with the Respondent Bank at their Onitsha Branch Office.
2. Whether the learned trial judge was right in holding that the Plaintiff’s/Appellants did not suffer any injury entitling them to damages.
3. Whether the judgment of the learned trial judge is sustainable.
Learned counsel for the Respondent adopts the issues nominated by the Appellants.
On Issue No. 1, learned counsel for the Appellants submitted that the Appellants proved their case on the balance of probabilities that the sum of N800,000.00 was lodged by the 2nd Appellant into the 1st Appellant’s account.
That, in their further, further Amended Statement of Claim, the Plaintiffs/Appellants averred in paragraph 12(a) as follows:-
“That the lodgments made on the 29/9/92, for one hundred thousand naira (N100,000.00), on 30/11/92 for Three hundred thousand naira (N300,000.00) and on 30/12/92 for Four hundred thousand naira (N400,000.00) as stated supra in paragraph 12 were made by the 2nd plaintiff personally”.
He submitted that the 2nd Plaintiff/Appellant also gave evidence of the said lodgments at page 149 of the record although he did not tender any bank tellers to back up his claim. Still, on page 149, the 2nd Plaintiff/Appellant stated how he was attacked by armed robbers and his car together with the tellers was removed by armed robbers at gun point.
Counsel submitted that the Respondent bank admitted that exhibit “C – C4” being bank statements with respect to the 1st Plaintiff/Appellant’s account emanated from their custody.
That the said documents indicated that credit entries totaling N800, 000.00 were made at various times in favour of the 1st Plaintiff/Appellant.
The Respondent bank, said counsel, in paragraph 9 of their Amended Statement of Defence admitted that such credit entries were made in the 1st Plaintiffs/Appellant’s account and went ahead to state that the entries were erroneously passed by its computer clerk into the 1st Plaintiff’s/Appellant’s account and these entries were accordingly reversed on discovery.
Counsel submitted that the Respondent’s contention is that the 2nd Plaintiff/Appellant did not pay any money into the 1st Plaintiff/Appellant’s account and that whatever entries that were made in the said account was occasioned by computer error.
Learned counsel for the Appellants submitted that the Respondent’s only witnesses at pages 157 – 158 of the record during cross- examination stated as follows:
Question: The reversal in the credits in the Plaintiffs account, into what account was it paid in?
Answer: It was reversed into the suspense account because the error was computer generated.
Question: Who owns the suspense account?
Answer: It does not belong to anybody.
Question: The Manager of the Bank… were relieved of their duties because they embezzled the Plaintiffs money.
Answer: These staff of the bank were dismissed because they gave huge unauthorized loans. Their sack had nothing to do with this case.
Counsel submitted that by the evidence of the Respondent, there is an admission on oath that the sum of N800,000.00 cash which was paid into the 1st Plaintiff/Appellant’s account was later withdrawn and kept in a suspense account which belongs to nobody. That, it is therefore not in doubt that the physical cash of N800,000.00 passed through the 1st Plaintiff’s/Appellant’s account at the material time relevant to this case. This, he said is different and absolutely inconsistent with the Respondent’s contention of computer error.
Counsel argued that this piece of evidence as vital as it appears was swept under the carpet and referred to as speculative and irrelevant by the learned trial judge. He submitted that the admission by the Respondent’s only witness is binding on the Respondent and does not require further qualification.
He referred to the cases of Nwankwere v. Usorji 10 S.C.N.J. 38;
Onuugwa v. The State (1976) 2 S.C. 169:
Standard Consolidated Dredging and Construction Company Ltd. and Anor. v. Katanescret Nig. Ltd. (1986) 5 N.W.L.R. 23 (b) and 151 of the Evidence Act Cap. 112 Laws of the Federation.
Learned counsel submitted further that by counts 10, 11 and 12 of charge NO. FBT/1B/CR/1/98 – Federal Republic of Nigeria v. Patience Nwachukwu & Others, the Respondent’s Onitsha Bank Manager and his credit officers were charged to court for tampering with and manipulating the 1st Plaintiffs/Appellant’s account amongst other things and dismissed from the bank. He argued that the obvious conclusion is that the Bank officials unlawfully removed the Plaintiffs N800,000.00 from the 1st Plaintiff/Appellant’s account to suspense account where it eventually disappeared resulting in the charge at the Failed Banks Tribunal Ibadan. The situation in the instant case, said counsel, is far miles away from computer error.
Counsel submitted that the learned trial judge’s contention at page 174 of the record that “what is in issue here is not whether or not cash was lodged into the plaintiff s account but whether the 2nd Plaintiff lodged the alleged sum into the account is completely misconceived.
That, the Respondent’s case is that no money was lodged into the 1st Plaintiffs/Appellant’s account at all time material to this case and that the amount credited in the said account was in error by reason of computer problems.
He submitted that computer error presupposes the transfer of figures from one document to another and cannot degenerate into physical cash capable of being transferred from the 1st Plaintiff’s account to the suspense account from where it eventually disappeared.
Counsel submitted that the combined effect of the Charge No. FBT/IB/CR/1/98 FRN v. Mrs. Patience Nwachukwu and Others and the unqualified admission of the DW1 points unequivocally to the fact that the 2nd Plaintiff/Appellant actually lodged the sum of N800,000.00 as claimed. There is no evidence at the lower court to show that somebody else other than the Appellants is claiming to have lodged the N800.000.00 in the Appellant’s account.
Counsel submitted further that the rejection of exhibit ‘L’ as unreliable by the learned trial judge as proof of the loss of the tellers is most misconceived. The said Exhibit “L” he said is a police extract from Nnewi Divisional Police Station, which said police station is superior to the Oraifite police post.
That, by S.258 of the Police Act Cap. 359 LFN 1990, Police Posts are not authorized to issue police extracts.
That, from the contents of the police extract from Oraifite Police Post contained at page 46 of the record, the 2nd Appellant made a report of the loss of the car together with some important documents. The inability of the 2nd Appellant to include the bank tellers in the said report should not be held against him bearing in mind the circumstances surrounding his frame of mind immediately after the armed robbery attack. That, by the said police extract from Oraifite Police Post, the 2nd Appellant was advised to report subsequently and make a formal report. Exhibit “L” is the product of the said formal report. He submitted that the said Exhibit “L” is substantially the same as the report from the Oraifite Police Post contained at page 46 of the record and ought not to have been rejected.
On Issue No. 1, learned counsel for the Respondent submitted that the crucial issue between the parties is whether the credit entries in Exhibits C1 – C4 which were reversed by the Respondent were actual cash lodgments made by the 1st Appellant through the 2nd Appellant. He argued that the burden of proving that the credit entries were actual cash lodgments rests squarely on the Appellants by virtue of S. 135 (1)(2) and S. 136 of the Evidence Act Cap. 112 LFN 1990 and that the Appellants have not discharged that burden.
Counsel submitted that for the Appellants to prove the lodgments, the lodgments tellers have to be produced. The 2nd Appellant and PW2, the Banking consultant admitted that when money is lodged physically into an account, the payee retains a copy of the lodgment teller. No tellers evidencing lodgments were tendered in evidence by the Appellants. Appellants relied solely on Exhibits C1 – C4 as evidence of actual or physical lodgment of the monies, but these lodgments were denied by the Respondent in its pleadings and therefore Appellants needed to do more than just relying on Exhibits C1 – C4.
Respondent by credible evidence, said counsel established that the credit entries in Exhibits C1 – C4 were computer generated errors and that Appellants were informed of the errors immediately they were detected by the Respondent through a letter dated 4th June 1993 (i.e. Exhibit H) that, the Appellants on receipt of exhibit H were satisfied with the Respondent’s explanation as to the credit entries and their reversal and did not in any of their further or future correspondences raise the Issue of tellers. PW1 under cross-examination admitted not replying to exhibit H. (Page 139 of the record).
Counsel submitted that about four (a) letters were written to the Respondent by the Appellants between the time they were informed of the reason for the reversals of the credits and the date of the alleged armed robbery attack, but that in none of the letters did they make any mention of the tellers with which they lodged the sum of N800, 000.00 (Eight hundred thousand naira) This fact, was admitted by 2nd Appellant under cross-examination at page 152 of the record.
Counsel submitted that it is pertinent to note that Appellants did not report the armed robbery attack or loss of the tellers and cheque book to the Respondent as required by banking rules and Practice.
This fact was admitted by PW1 under cross-examination at page 139 of the record. And, that the only reasonable conclusion is that PW1 did not loose any tellers or cheque book as the right action would have been to report to their bankers so as to forestall any fraud in their account.
Counsel submitted that nowhere in the evidence of Dw1 was physical cash mentioned.
What was mentioned was the entry of the credits in the Appellant’s account. What is in Issue is whether the credit entries in the Appellant’s account were actually backed up with actual lodgment of cash or not. The DW1 did not state that physical cash was transferred from the 1st Appellant’s account to a suspense account rather it was the credit entries that were transferred to a suspense account as the credit entries were erroneously generated by the computer.
Learned counsel for the Respondent submitted further that the Appellants have also placed much emphasis and value on charge No. FBT/1B/CR/1/98 Federal Republic of Nigeria vs. Patience Nwochukwu & Ors and Particularly on counts 10, 11 and 12 of the said charge to establish that the bank officials tempered and manipulated the Plaintiffs/Appellants account and concluded that the banks officials removed the Appellants N800,000.00 (Eight Hundred Thousand Naira) from the 1st Plaintiff/Appellant’s account to a suspense account where it eventually disappeared which is miles away from a computer error.
Counsel pointed out that Charge No. FBT/IB/CR/1/89 (supra) was admitted on 30th April, 2007 as additional evidence on appeal by the Court of Appeal.
He submitted that Charge NO. FBT/IB/CR/I/98 FRN v. Patience Nwachukwu & Ors. Does not have any relevance with the facts in Issues in this appeal and if anything, the said charge further strengthens the case of the Respondent that the Appellants have all along been indebted to the Respondent especially as the Charge in Count II reveals that 1st Appellant was indebted to the Respondent in the sum of N776,743.00.
The Appellants, said counsel, are the beneficiaries of the alleged offence because by conceding their debit balances, interests payable on the account on the debit level were denied the Respondent Bank. Even on the preponderance of evidence, the Charge cannot transform to the proof of the facts that the Respondent unlawfully reversed the sums of N800,000.00 (Eight hundred thousand naira) from the 1st Appellant’s account. The Appellants were not charged as accused persons in Charge NO. FBT/IB/CR/I/98 (supra) and therefore their reliance on it’s of no use.
Finally, or Issue No. one, Respondent’s counsel submitted that a Charge is a mere allegation of commission of crime against an accused person and until proven guilty, the accused person remains innocent. He referred to S .36 (5) of the Constitution of the Federal Republic of Nigeria 1999.
In deciding Appellants Issue No. 1, it is obvious that the learned counsel for the Appellants totally misconceived the position of the law in relation to the facts of the case in this appeal.
In the trial court, the Appellants alleged that they physically deposited the total sums of N800,000.00 into the 1st Appellant’s account. That, would have been cheap to prove in the absence of a denial by the Respondent.
The Respondent on the other hand averred and gave evidence that the entries in exhibit C1 – C4, which the Appellants themselves relied on are products of computer errors which were discovered and that both the fact of the errors and the reversals that were consequentially effected were communicated to the Appellants. That the Appellants tacitly accepted and/or acquiesced in these position of things.
From this moment on, the evidential burden of proving either that the moneys were physically paid by the Appellants into the 1st Appellant’s account and/or that the entries and reversals in the 1st Appellant’s account were effected by the Respondent fraudulently or in bad faith became that of the Appellants.
This burden by the Appellants could not have been discharged either on account of the loss of teller by the Appellants to armed robbers or by the content of counts 10, 11 and 12 in Charge No. FBT/IB/CR/1/98 FRN v. Patence Nwachukwu & Ors both of which the Appellants have made much ado about.
He who asserts must Prove.
By Section 136(1) of the Evidence Act 2011, the burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence.
See Lonse v. F.B.N. (2006) 3 NWLR (Pt. 967) 228.
Daodu v. N.N.P.C. (1998) 2 N.W.L.R. (Pt. 538) 355.
Kala v. Potiskum (1998) 3 NWLR (Pt. 540) 1.
N.B.N. Ltd. v. S.C.D.C. Ltd. (1998) 5 NWLR (pt. 548) 144
Braimah v. Abasi (1998) 13 NWLR (Pt. 581) 167.
Alhaji Otaru & Sons Ltd. v. Idris (1999) 6 NWLR (Pt. 606) 330.
Itauma v. Akpe-Ime (2000) 7 SC (Pt. II) 24.
Audu v. Guta (2004) 4 NWLR (Pt. 864) 463.
Mani v. Shanono (2006) 4 NWLR (Pt. 269) 132.
In the instant case, the Appellants failed to discharge the burden of proving their assertion that they physically paid the sums of N800, 000.00 (Eight hundred thousand naiad) into the 1st Appellant’s account in the Respondent Bank.
Issue No 1. is resolved against the Appellants.
On Issue No. 2, learned counsel for the Appellants submitted that the Appellants did suffer great injury and are therefore entitled to damages.
He submitted that the Plaintiffs/Appellants who are in business were denied the access to their N800,000.00 lodged into the 1st Appellant’s account for more than 15 years. Counsel referred to the cases of Salawu v. Union Bank Nigeria Ltd. (1986) 4 N.W.L.R. (Pt. 38) 701.
A.C.B. v. Agbanyin (1960) N.S.C.C. 12 and urged the award of damages to the Appellants.
Learned counsel adopted his above arguments on Issue No. 2 for Issue No. 3 and added that the sum of N800, 000.00 lodged in the Respondent’s account discharged the Appellants of any indebtedness to the Respondent.
On Issues 2 and 3, learned counsel for the Respondent submitted that to be entitled to damages, the Appellants must prove that the lodgment of N800,000.00 (Eight hundred thousand naira) was made and that through the unlawful reversal of the various sums, Appellants have suffered injury due to the non-utilization of the sums.
Counsel submitted that the only injury which the Appellants pleaded was the return of the cheque of N50,000.00 (Fifty thousand naira) issued to Franco Franca Enterprise. That the said cheque was issued on 12th September 1994, after they had commenced the action on 16th August 1993 at the High Court. He further submitted that the cheque was issued despite the fact that Appellants were aware that they were not in credit as Respondent through many letters written to them had threatened to sell the security for the facility if they did not regularize the account. (Exhibit R, D and H refers).
He submitted that the return of the cheque was therefore lawful and had caused no injury to the Appellants.
Finally, on Issues 2 and 3, learned counsel for the Respondent submitted that the alleged unlawful reversals are not a breach of the duty of care since no sums were ever lodged, therefore the Appellants suffered no injury and could not be entitled to damages.
Issues Nos. 2 and 3 are predicated on issue No. 1.
In other words, by the failure of Appellants Issue No. 1,
Issues Nos. 2 and 3 could not succeed.
The tort of negligence including bankers negligence presupposes (i) duty of care (ii) breach of duty (iii) resulting consequential damages.
See Makwe v. Nwukor (2001) 6 M.J.S.C. 179.
In the instant case, the Appellants did not prove any of the above ingredients of negligence as against the Respondents having failed to prove that they ever lodged the sums of N800, 000.00 (Eight hundred thousand naira) into the 1st Appellant’s account. The learned judge was right to have held that the procedures adopted by the Respondents have not occasioned any injury to the Appellants.
Issue Nos. 2 and 3 are also resolved against the Appellants. Having resolved the three (3) Issues in this appeal against the Appellants, the appeal lacks merit and it is accordingly dismissed.
There shall be costs of N30, 000.00 in favour of the Respondent.
ISAIAH OLUFEMI AKEJU, J.C.A: I had the opportunity of reading in its draft form the judgment of my learned brother, MOJEED ADEKUNLE OWOADE JCA just delivered. I am completely in agreement with the reasoning and the conclusion of my learned brother and the appeal is dismissed by me. I abide by the award of costs in favour of the Respondent.
EMMANUEL AKOMAYE AGIM, J.C.A: I agree.
Appearances
R.I. ObumseFor Appellant
AND
Emeka Mozie with H.O. EzeFor Respondent
