CHIEF BEN IFEANYI OKOYE & ANOR v. ECO BANK NIGERIA PLC & ANOR
(2019)LCN/12718(CA)
In The Court of Appeal of Nigeria
On Friday, the 8th day of February, 2019
CA/L/263/2014
RATIO
COURT AND PROCEDURE: WHEN THE DECISION OF A COURT IS PERVERSE
“For a decision by a Court of law, which was what the award on costs is, to be perverse, it must be shown not to be based and supported by the relevant and material pleadings and evidence placed before the Court by the parties. In the case of NEPA v. Ososanya (2004) 1 SC (Pt. 1) 159, (2004) 5 NWLR (867) 601, it was held by the apex Court; per Iguh, JSC, that: – ‘A decision of a Court is perverse when it ignores the facts or evidence before it and, when considered as a whole, amounts to a miscarriage of justice.’ See also Atolagbe v. Shorun (1985) 1 NWLR (2) 260; Adimora v. Ajufo (1988) 3 NWLR (80) 1; Agina v. Agina (1991) 4 NWLR (185) 358; CSS Bookshops Ltd v. Rg. T. M. C. Rivers State (2006) ALL FWLR (319) 819; Oladipo v. M. L. G. A. (2010) 5 NWLR (1186) 117.” PER MOHAMMED LAWAL GARBA, J.C.A.
EVIDENCE: WHAT IS AN ADMISSION
“Since an admission is a statement; oral or documentary, or conduct which suggests any inference or gives any reasonable impression as to any fact in issue or relevant fact made by a person, the entire facts and circumstances or con in which the statement was made as to any fact in issue or relevant, have to be taken into account or considered in order to determine whether the statement constitutes and amounts to an admission in law or not. See Anason Farms Limited v. NAL Michant Bank (1994) 3 NWLR (331) 241, Nwankwo v. Nwankwo (1995) 5 SCNJ, 44.” PER MOHAMMED LAWAL GARBA, J.C.A.
INTERPRETATION: MEANING OF ‘SHAREHOLDERS’ AND ‘BANKS’
“Shareholder’ is defined in Black’s Law Dictionary 9th Edition, at page 1500 as follows: – ‘One who owns or holds a share or shares in a company, esp a corporation. ‘Also term share owner.’ Then ‘minority shareholder’ is defined as A shareholder who owns less than half the total shares outstanding and thus cannot control the corporation’s management, or single handedly elect directors.’ A bank customer in its simple term, means a person; natural or corporate, who transacts any banking business with a bank in the ordinary and usual course of its services as a bank registered and/or licenced under the Companies and Allied Matters Act (CAMA) and the Banks and other Financial Institutions Act (BOFIA).” PER MOHAMMED LAWAL GARBA, J.C.A.
JUSTICES
MOHAMMED LAWAL GARBA Justice of The Court of Appeal of Nigeria
JOSEPH SHAGBAOR IKYEGH Justice of The Court of Appeal of Nigeria
JAMILU YAMMAMA TUKUR Justice of The Court of Appeal of Nigeria
Between
1. CHIEF BEN IFEANYI OKOYE
2. NORTHGATE LIMITED Appellant(s)
AND
1. ECO BANK NIGERIA PLC
(Substituted by Order of Court dated 6th June, 2012)
2. MR. ALADE AGBABIAKA (SAN)
(Trading Under the name and style of Alade Agbabiaka (SAN) & Co. Sued as Legal Practitioners for and minority Shareholders of Defunct International Trust Bank Plc.) Respondent(s)
MOHAMMED LAWAL GARBA, J.C.A. (Delivering the Leading Judgment):
This appeal is against the judgement entered in favour of the 1st Respondent by the Federal High Court, Lagos, against the Appellants, on the 8th November, 2012 and is premised on eleven (11) grounds contained on the Notice of Appeal dated 11th February, 2017. In the judgement, the Appellants? counter claim was dismissed and so in the Amended Appellant Brief filed on the 8th March, 2017, deemed on the 14th January, 2018, the following issues are submitted to the Court for decision in the appeal;
i. Whether despite the settlement agreement the 1st Respondent (Plaintiff) could still maintain this claim against the Appellants (1st and 2nd Defendants) ? Ground 10
ii. Whether from the totality of evidence before the lower Court the 1st Respondent proved it claim to entitle it to judgement ? Grounds 1, 2, 3, 4, 5, 6 and 11.
iii. Whether the 2nd Appellant as Counter Claimant proved its counter-claim to entitle it to judgement. ? Ground 7
iv. Whether the interests awarded to the 1st Respondent was justifiable in law and or equity. ? Ground 8
v. Whether the award of costs against the 1st and 2nd Appellants was proper in the light of the partial success of the defence. ? Ground 9.”
Not satisfied with some part of the judgement, the 1st Respondent also filed a Notice of Cross Appeal dated and filed on the 28th November, 2012 on three grounds. In the Amended 1st Respondent brief filed on 11th April, 2017, deemed on 14th November, 2018, four (4) issues were formulated for determination in the appeal and cross appeal as follows: –
(1) Whether the Court below erred in law when it refused to treat the 1st Respondent’s suit as unopposed and consequently enter judgement in its favour in the entire sum stated on the writ of summons, after holding Appellants’ witnesses (particularly the evidence of the alleged expert witness; DW2), being the crux of the Appellants alleged defence, are inadmissible (through wrongly admitted in evidence)
Formulated from Grounds a, b and c in the Notice of Cross Appeal.
(2) Whether the Court below was right when it held that the Terms of Settlement executed by the Minority Shareholders in SUIT NO: FHC/L/CS/1361/2005 dealing with the manager of the defunct International Bank and Oceanic Bank International Plc, does not absolve the Appellants from liabilities emanating from the facilities availed the 2nd Appellant (guaranteed by the 1st Appellant) leading to the instant suit
Formulated from Ground 10 of the Appellants? Amended Notice of Appeal.
(3) Whether from the facts and circumstances of the suit herein, particularly the admission of indebtedness by the Appellants, the Court below was right in entering judgement (in part) in favour of the 1st Respondent and dismissing the counter claim of the Appellants for lacking merit?
Formulated from Ground 1, 2, 3, 4, 5, 6, 7 and 11 of the Appellants? Amended Notice of Appeal.
(4) Whether from the facts and circumstances of the suit herein, the Court below, having entered judgement in favour of the 1st Respondent in the amount admitted by the Appellants, was right to have awarded pre and post judgement interest, and cost of the action in favour of the judgement creditor (the 1st Respondent herein)?
Formulated from Ground 8 and 9 of the Appellants? Amended Notice of Appeal.
The 1st and 2nd Respondents’ brief was filed on 18th May, 2017, also deemed on the 14th November, 2018, wherein two (2) issues are raised for decision in the cross appeal.
In addition, the Appellant’s Reply brief filed on 28th March, 2018, deemed on 14th November, 2018 and the Cross Appellant’s Reply brief filed was filed on 21st November, 2018 to complete the settlement of briefs.
The 2nd Respondent did not file a brief in the appeal.
I intend to consider the issues formulated by the Counsel for the parties for their respective appeals.
Appellants’ Submissions on the Appeal
It is submitted on issue 1 that the Lower Court was wrong in the finding that the settlement agreement between shareholders of the defunct International Trust Bank, Plc (ITB) and 1st Respondent only settled claims in respect of minority shareholders of ITB and did not extend to the Appellants? indebtedness to the 1st Respondent. The recital and clauses 1(a)(ii) 3(a) and 4(h) of the agreement were cited for the argument that the agreement applies to all disputes and possible claims arising from the relationship between the parties, including the right of set off against any mutual debts between them. The case of Solicitor General Western Nigeria v. Dr. Adebonojo (1971) ALLNLR 181 @ 192 was referred on interpretation of words used in a document and it is contended that the facility granted to the 2nd Appellant by the 1st Respondent was secured by the shareholdings of the 2nd Appellant in the defunct ITB which were also the subject matter of the suits which led to the settlement agreement between the parties. That since the parties, aware of these facts, agreed to settle all claims in respect of the shares, including the lien thereon, the 1st Respondent’s claim are covered by the agreement as shown in paragraph 36 of the 1st Respondent’s statement of claim and Exhibit C3; paragraph iii.
According to learned Counsel, the stock over which the 1st Respondent had a lien for the facility granted the 2nd Appellant were the share holdings of the latter which was converted into cash and transferred to the 2nd Respondent as custodian and that the settlement agreement resolved the value of the shares.
He argues further that without the shares as security, the 1st Respondent would not have granted the facility to the 2nd Appellant and so the shareholding of the 1st and 2nd Appellants were an intrinsic part of the facility transaction in Exhibit C3.
On issue 2, it is submitted that 1st Respondent did not prove its case as required by law as it only relied on the statement of account showing a debit balance without demonstrating how the amount was arrived at since the 2nd Appellant had denied and showed the correct position of its account with the 1st Respondent which was in credit. Also, that the 1st Respondent did not show the interest rates and charges upon which the calculations in its statement of account were made, were in line with the offer made to the 2nd Appellant as required by the law stated in Bilante v. NDIC (2011) ALLFWLR (598) 804 @ 819.
It is also submitted that the 2nd Appellant did not admit any debt to the 1st Respondent as was erroneously held by the Lower Court, without a consideration of all the avernments in the 2nd Appellant’s Statement of Defence as required in MTN Nigeria Communication Limited v. WI Gatap Trade & Investment Limited (2012) 26 WRN, 119 @ 140. In further argument, Counsel said that Exhibit D7; a document authored by the 1st Respondent specifically confirmed the existence of the fixed deposit account into which the 2nd Appellant’s money was temporarily blocked to be later substituted with a mortgage on landed property for the facility granted by the 1st Respondent.
Furthermore, that the 1st Respondent made admission of the fixed deposit and it required no further proof under Section 42 of Evidence Act. The Lower Court was said to have required a standard of proof not provided for by the law in civil matters and so was wrong to say that there was no proof of the fixed deposit account even in the face of the evidence of DW3 which showed a deposit of N66,000,000.00 into the account as a condition precedent for the draw down on the facility granted the 2nd Appellant save for the mere denial by DW1 that there was no fixed deposit, Counsel contends, no evidence was led by the 1st Respondent to challenge the claim by the 2nd Appellant on the fixed deposit.
Arguments on the issue 2 are adopted for issue 3 and it is submitted that the Lower Court was wrong to have dismissed the 2nd Appellant’s Counter Claim. The Court is urged to reverse the decision and make a finding that the counter claim was proved in the sum claimed.
On issue 4, it is submitted that the award of 22% interest from the 16th May, 2012 until judgement, was erroneous as it was neither claimed nor proved by the 1st Respondent as is required by law; being pre-judgement interest.
Learned Counsel said that even though the law recognizes the right to interest in a claim for return of money arising from commercial transactions, held for a long without justification, there are two (2) conditions that are necessary before an award could be made as follows: –
(i) Denial by the Defendant for the plaintiff to the use of its money and
(ii) The use of the money by the Defendant.
The case of NGSC Limited v. N.P.A. (1990) 1 NWLR (129) 741 was relied on for the submission and it is contended that the 1st Respondent had by its own application ex-parte dated 11th May, 2011; denied the 2nd Appellant the use of its money with the 2nd Respondent worth over N600,000,000.00 which was later reduced to N200,000,000.00 by the Lower Court on 29th July, 2011. That the award of interest in favour of the 1st Respondent from 16th May, 2011 until judgement; which covered the period it denied the 2nd Appellant the use of its money, is perverse as it could not be said to have denied the 1st Respondent the use of its money or to have used the money itself during the period in question.
It is the further argument of Counsel that the money of the 2nd Appellant was constructively in possession of the 1st Respondent who was not entitled to interest on its claim even if it succeeded. In any event, if interests was to be awarded, it should have been at the rate upon which the money was fixed upon the direction by the Lower Court. Counsel said and he urges the court to set aside the award.
On issue 5, it is submitted that since the 1st and 2nd Appellants had partially succeeded in their defence of the 1st Respondent’s claim for N177,123,139.67, the award of costs against them alone was inequitable as the 1st Respondent also failed partially in its claim. The Court is urged to set aside the award of costs against the Appellants for being perverse and inequitable.
In conclusion, the Court is called upon to allow the appeal, dismiss the 1st Respondent’s claim and enter judgment in favour f the 2nd Appellant on its counter claim.
1st Respondent’s Submissions on the Appeal
It is submitted that the Appellants in their issues 1 and 3 are approbating and reprobating at the same time on the settlement between the parties, which under issue 1 they say precluded the 1st Respondent from suing them on the facility granted them and under issue 3, that they are entitled to their counter claim, arising from the same facility affected by the settlement agreement. It is argued that by their counter claim which is a separate and distinct action, the Appellants have admitted that the terms of the agreement do not preclude the parties from taking actions against any of them on issues not relating to the scheme of merger between International Trust Bank and Oceanic Bank International, Plc (OBI). The Court is urged to so hold and resolve the issue in favour of the 1st Respondent.
In the alternative, it is submitted that the subject of the agreement and the 1st Respondent’s suit against the Appellants are different and that the Lower Court was right to have held that the 1st Respondent’s suit was not part of the claims settled in the agreement after a proper interpretation of the terms thereof and concluding that the Appellant’s liability to the 1st Respondent was not discharged by the agreement. Reference was made to clause 3(a) of the agreement and it is maintained that it is in respect of the scheme of Merger as it relates to the capacity of the Appellant’s as minority shareholders of International Trust Bank and not the relationship of a blanker/customer between them the 1st Respondent. Clause 4(h) of the agreement is said to apply only to the 1st Appellant and 1st Respondent in relation to the scheme of merger and not applicable to the 2nd Appellant who was not a minority shareholder of International Trust Bank or a party the agreement.
The arguments on its issue 3 are to the effect that the Lower Court was right to have entered judgement for the 1st Respondent in the sum admitted by the Appellants which, in law, required no further proof by the 1st Respondent. Reference was made to, among others, the Ruling by the Court on Appellants’ application to amend their Notice of Appeal. Facts said not to be in dispute and evidence of DW1 and DW2 on alleged admission were set out and it is submitted that the indebtedness of the Appellants to the 1st Respondent was settled by their admission on the authority of Ehinlanwo v. Oke (2008) LPELR-1054 (SC), (2008) 6-7 SC (Pt. II) 123 and Taiga v. Moses-Taiga (2012) 10 NWLR (1308) 219 @ 244. Relying on Nwabuoku v. Onwordi (2006) LPELR-2082 (SC), learned Counsel said the Lower Court had the power to evaluate documentary evidence and was right in according weight to Exhibit D3 on the admission of indebtedness by the Appellants and rejecting Exhibit D4 on the alleged amount in a fixed deposit account which was successfully challenged by the 1st Respondent. That the Lower Court was not bound to accord weight to a piece of evidence merely because it was given by an expert, but it has to be evaluated like every other evidence in a case to determine its weight as was stated in A.N.T.S v. Atoloye (1993) 6 NWLR (298) 233 @ 253. According to learned Counsel, the letter of offer of the facility to 2nd Appellant (Exhibit D7) which provided that the said fixed deposit was to be used as security does not discharge the burden on the Appellants to show that the fixed deposit was actually lodged as was rightly found by the Lower Court.
It is also the case of Counsel that Lower Court which saw the dismeanour of DW3 rightly disbelieved him on the existence of the fixed deposit account which the Appellant did not know about before the report in Exhibit D4. Once again, the Lower Court is said to be right in entering judgement in favour of the 1st Respondent based on the admission by the Appellants of their indebtedness in Exhibit D3 and evidence of DW1 and DW2. The Court is urged to resolve the issue in 1st Respondent?s favour.
On the award of pre-judgment interest and costs, argued under issue 4, the submissions are that the Lower Court was right to have awarded both based on the admission of indebtedness by the Appellants as at May, 2011 and their refusal to pay the admitted sum, theryineby deng the 1st Respondent the use of its money from then until judgement was delivered by the Lower Court. The case of NGSC Limited v. NPA (supra) is said to support the position.
It is further submitted that the award costs is discretionary and that it follows event on the authority ofAkinbobola v. Plisson Fisko (1991) 1 NWLR (167) 27 @ 278 and Olokunlade v. Samuel (2011) 17 NWLR (1276) 290 @ 322. It is contended that since the counter claim of the Appellants was dismissed, being a separate action, the dismissal attracted costs to the 1st Respondent who defended it and the admission of indebtedness by the Appellants and the partial success of the 1st Respondent’s claim in the judgement delivered in its favour, also attracted costs for prosecuting the claim. The Lower Court is said to be right in awarding costs in favour of the 1st Respondent in the circumstances. O.O.M.F Limited v. N.A.C.B. Limited (supra) and ACB, Plc v. N.T.S. Nigeria Limited (2007) 1 NWLR (1016) 596 @ 627 were referred to on the nature of a counter claim and the Court is urged to resolve the issue in favour of the 1st Respondent.
In conclusion, the Court is prayed to dismiss the appeal and affirm the decision by the Lower Court.
In the Appellant?s Reply brief, relying onMetal Construction (West Africa) Limited v. Aboderin (1998) 8 NWLR (563) 538 @ 547, it is submitted that the Appellants did not approbate and reprobate on the settlement agreement since it was a defence in the first instance and an alternative in the second instance which the Appellants are entitled to rely on in the case as the 1st Respondent owed money to them. That if the defence on the settlement had succeeded, it would have ended the dispute between the parties and its failure led to the consideration of the counter claim by the Appellant. The Ruling of the Court on the Appellants’ application to amend their Notice of Appeal was said not to have decided the issue of admission in indebtedness by the Appellants which was an issue in the appeal, at the interlocutory stage against the law as stated in Mobil Oil Nigeria Plc v. Kena (2001) 1 NWLR (695) 555 @ 564.
On award of interest, it is maintained that even if there was to be interest, pre-judgement, it should be at the rate upon which the money ordered by the Lower Court to be placed at Guaranteed Trust Bank pending the judgment and not the rate awarded by that Court in its judgement.
Arguments in the Reply brief on Exhibit D7 in relation to the existence of a fixed deposit account are further arguments on the issue and do not deal with or answer new issue raised or arising from the 1st Respondent’s brief.
Resolution of the Appeal
The crux of the Appellants’ issue 1 is that in view of the settlement Agreement the 1st Respondent could not maintain its claim against them. In its judgement, the Lower Court found and held that the claims by the 1st Respondent are different and not covered by the said settlement agreement which was in respect of the merger scheme between the 1st Respondent and minority share holders of International Trust Bank, among whom were the Appellants.
This was the reasoning the Lower Court, at pages 1167 – 69 of Vol. 3 of the Record of Appeal; The term of settlement arose as a result of a dispute between the Plaintiff and the minority shareholders of the defunct International Trust Bank Plc also made up of 1st and 2nd Defendants concerning their shareholdings at the time merger transaction was concluded wherein the minority shareholders inclusive of the 1st to 2nd Defendants complained of unfairly prejudicial and discriminatory treatment meted to them whereas, this suit concerns the inability of the 1st and 2nd Defendants to liquidate their outstanding indebtedness to the Plaintiff.
It is proper to quickly point out that the issue of the 1st and 2nd Defendants’ indebtedness or the facility the 1st and 2nd Defendants obtained from the Plaintiff did not or was not part of the claim settled as reflected in the terms of settlement. The claims that were settled as reflected in the term of settlement were claims in respect of the scheme of merger as it relates to the whole or entire minority shareholders inclusive of the 1st and 2nd Defendants in their capacity as shareholders of the defunct International Trust Bank Plc and cannot by any stretch of imagination be extended to include the 1st and 2nd Defendants? indebtedness to the Plaintiff that did not form part of terms of agreement.
It is to be noted that the 1st and 2nd Defendants are not the only minority shareholders that were parties in the terms of settlement in the scheme of merger in the earlier suit. Therefore in my humble view, the 1st and 2nd Defendants cannot be discharged from liability in their indebtedness to the Plaintiff on account of the terms of settlement in a scheme of merger involving persons other than the 1st and 2nd Defendants. This is so because those other minority shareholders other than the 1st and 2nd Defendants do not have any collateral issue of indebtedness with the Plaintiff.
What the term of settlement in effect simply says in my humble view is that all existing disputes claims and causes of action between the minority shareholders of defunct International Trust Plc and the Plaintiff as regard their shareholding are fully and finally settled by the terms of settlement between the parties involved and this for the umpteenth time does not involve the 1st and 2nd Defendants’ indebtedness to the Plaintiff.
In its Amended Statement of Defence and Counter Claim of 29th November, 2011, in paragraphs 27-30, the 2nd Appellant averred that the settlement agreement arose out of a dispute between the 1st Respondent and the minority shareholders of International Trust Bank that went to Lower Court as Suit No.FHC/L/CS/1361/05 and its purpose was to fully and finally settle all claim of the minority share holders and the 1st Respondent; ‘Whether such claims are civil or otherwise and all possible claims or issues arising from the relationship of the parties.’
By their own showing in the avernments, the settlement agreement between them and 1st Respondent was in respect of all claims arising from their relationship of being minority shareholders in International Trust Bank which was taken over by the 1st Respondent and its alleged refusal to continue any transaction with them as such shareholders. Admittedly therefore, the settlement agreement between the 1st Respondent and the minority shareholders of International Trust Bank among whom were the Appellants, reached in the named suit before the Lower Court was in respect of and related to them only in their capacity or position as members of the minority shareholders of the international Trust Bank. The agreement was limited to the rights and obligations of the parties thereto in their positions as shareholders and owners of the defunct International Trust Bank. Clause 19 1(a)(ii) of the agreement relied on by the Appellants, bears that position in its term or when it provides that: –
‘The parties agree that the cash settlement and the obligations set forth in this Agreement shall constitute full and final settlement of any and all claims and causes of action by the minority shareholders against oceanic bank, central bank of Nigeria or other regulatory institutions or by oceanic bank against the minority shareholders whether civil or otherwise and all possible claims or issues relating to the allegations contained in the existing disputes between the parties and any and all possible claims arising from the relationship between the parties.’
Clause 3(a), also cited and relied heavily on by the Appellants explicitly stated that the rights and obligations of the parties to the agreement referred to therein and to which the terms were applicable were those that arose, arising or would arise out of and in respect of the scheme of merger which gave rise to the suit initiated by the minority shareholders of International Trust Bank.
The clause provides that: –
Except such rights and obligations which shall accrue from the date of these terms of settlement onwards, both parties wholly and unconditionally release and discharge each other from any and all hitherto existing obligations, claims, demands, debts, actions, agreements, damages and liabilities against either party both in law and in equity under the scheme of merger or the Court’s ruling in any Court known or unknown, whether vicarious, derivative of direct including those which arise out of the scheme of merger or the ruling of the Court and or the existing dispute. (Underline supplied)
Perhaps I should point out that these terms of the settlement agreement are very clear, unambiguous straight forward and so are to be accorded their ordinary, simple, plain and natural meanings in the con employed by the parties thereto, in line with requirement of the principle of law on interpretation of documents and contracts or agreement between the parties. Ihunwo v. Ihunwo (2013) 8 NWLR (1357) 550, INEC v. Akuma (2013) 11 NWLR (1366) 494, Unity Bank Plc v. Olatunji (2015) 5 NWLR (1452) 203, Mortgages PHB Limited v. S.T.I. Company Plc (2016) 6 NWLR (1509) 465.
The parties set out in the agreement were Oceanic Bank International Plc and the minority shareholders of the defunct International Trust Bank (represented by the 2nd Appellant and two (2) others) and who agreed, inter alia, in paragraphs 1(a)(i) and 4(b) thereof as follows: –
1. Oceanic Bank hereby agrees as follows:
a. Oceanic Bank shall upon the signing of this Agreement by the parties and securing Central Bank of Nigeria (CBN) final approval;
(i) Pay to the Minority shareholders the total sum of =N=2,308,929, 238.00 (Two Billion, Three Hundred and Eight Million, Nine hundred and Twenty Nine Thousand, Two Hundred and Thirty Eight Naira only) (‘the cash settlement’) as a global settle for all the approximately 46% of the minority shareholders of the defunct International Trust Bank Plc.
4 Parties hereby agree as follows: –
b. These Terms of Settlement constitute the entire agreement between the parties herein with respect to the subject matter hereof (the scheme of Merger and the ruling of the Court dated the 19th July, 2007) and the existing dispute, and supersedes any and all prior negotiations, agreements, awards, Court judgments and dispute resolution processes between the parties with respect to the subject matter hereof.? (Underline supplied)
These terms agreed to by the parties to the settlement agreement have put it beyond viable legal argument that the agreement related, limited to and was in respect of only the scheme of merger, which was its subject matter, and nothing else. The argument that, because the 2nd Appellant was in addition to being one of the minority shareholders of International Trust Bank, an account holder who had operated and maintained individual account/s with the said International Trust Bank and so the agreement applied to its individual account/s, overlooks the fundamental differences between the two (2) capacities. Whereas shareholders of International Trust Bank; majority and minority, were the owners of the share capital upon which the bank was founded, individual account/s holders of the bank; whether shareholders or not, were mere customers of the Bank in relation to the accounts opened, operated and maintained by them at the bank which had no connection or relationship, howsoever, with the shareholding or ownership of the bank. ‘Shareholder’ is defined in Black’s Law Dictionary 9th Edition, at page 1500 as follows: –
‘One who owns or holds a share or shares in a company, esp a corporation. ‘Also term share owner.’
Then ‘minority shareholder’ is defined as A shareholder who owns less than half the total shares outstanding and thus cannot control the corporation’s management, or single handedly elect directors.’
A bank customer in its simple term, means a person; natural or corporate, who transacts any banking business with a bank in the ordinary and usual course of its services as a bank registered and/or licenced under the Companies and Allied Matters Act (CAMA) and the Banks and other Financial Institutions Act (BOFIA).
Undoubtedly, the reasoning of the Lower Court that the settlement agreement executed between Oceanic Bank and the minority shareholders of the defunct International Trust Bank in respect of the scheme of merger of the two (2) banks was not applicable and did not apply or affect the rights and obligations of individuals customers of International Trust Bank who operated and maintained accounts with the bank before the merger, accords with the law and common commercial ordinary sense. The position of the Appellants as minority shareholders in International Trust Bank was different and distinct from their position as individual customers of the bank who maintained accounts before it was merged/taken over by the Oceanic Bank in the Scheme of merger in respect of which the settlement agreement was reached. The rights and obligations of Appellants as minority shareholders in International Trust Bank were what the agreement specifically (as demonstrated in the relevant clauses and paragraphs thereof above) provided for and the parties to the agreement are bound by all the terms and conditions stipulated therein to which they freely and voluntarily endorsed and agreed upon. The agreement did not make even the remotest reference to the rights and obligations of individual account holders of International Trust Bank before the merger in any of the terms and conditions set out therein for the arguments of the Appellants that they are discharged of the liability in such accounts to be legally tenable and sustainable, on both facts and the law.
For emphasis, clauses 1(a)(ii) and 3(a) of the Agreement do not leave any doubt about the nature of the rights and obligations to which it applied and was applicable. Once more they provide that: –
(ii) The parties agree that the settlement and the obligations set forth in this Agreement shall constitute full and final settlement of any and all claims and causes of action by the minority shareholders against Oceanic Bank, Central Bank of Nigeria or other regulatory institutions or by Oceanic Bank against the minority shareholders whether civil or otherwise and all possible claims or issues relating to the allegations contained in the existing disputes between the parties and any and all possible claims arising from relationship between the parties.
3(a) Except such rights and obligations which shall come from the date of the these Terms of Settlement onwards, both parties wholly and unconditionally release and discharge each other from any and all hitherto existing obligations, claims, demands, debts, actions, agreements, damages and liabilities against either party both in law and in equity under the Scheme of merger or the Court?s ruling in any Court known or unknown, whether vicarious, derivative, or direct including those which arise out of the Scheme of Merger or the ruling of the Court and or the existing dispute.
It is beyond argument that the obligations dealt with, provided for and agreed to by the parties to the agreement in the clauses are those of Oceanic Bank and the minority shareholders of International Trust Bank of which the Appellant?s are only a part, in their position as such minority shareholders, in respect of the merger with or take over by Oceanic Bank. The agreement has absolutely nothing to do with the rights and obligations of individual accounts/holders as customers of the defunct International Trust Bank. Clause 4(h) of the agreement relied on by the Appellants for the argument does not suggest that the right of set off against any mutual debts between the parties provided therein, is a right that arose outside the terms and conditions set out in the agreement. The provisions of the clause are that: –
h. The Parties agree that no right of set off against any mutual debts between them shall be exercised outside these Terms of Settlement.
It needs to be noted that the mutual right of set off mentioned in the Clause can only reasonably mean the right of both sides/parties to the agreement in respect the disputes between them which arose from the scheme of merger. The disputes between the parties to the agreement did not arise from and was not between account holders as customers of International Trust Bank and Oceanic Bank which took it over or with which it was merged, in respect of the accounts as at the time of the takeover or merger.
I find the arguments of the Appellants wanting in merit and the issue is resolved against them.
On the 2nd issue, the Appellants did not deny or dispute, but admitted, that the defunct International Trust Bank granted the 2nd Appellant overdraft facilities vide the letters of offer dated 17th November, 2003 and 8th March, 2005 which were personally guaranteed by the 1st Appellant and that the facilities were fully utilized. The 1st Respondent in proof of the debt alleged to have arisen from the facilities, tendered, among other documents, the Letters of Offer; as Exhibits C3 and the statement of account No.0911001006090 with International Trust Bank, (renumbered account No. 0006242083 with Oceanic Bank International) showing transactions from 01/01/2006 to 16th May, 2011; as Exhibit B6.
The 2nd Appellant in paragraph 6 of the Amended Statement of Defence averred that it operated two (2) current accounts with the defunct International Trust Bank with Nos. 100-046591-001 and 1000-046591-031 and in paragraph 14, deposed that it engaged a consultant to reconcile the statement of the 1st account; i.e. 1000-046591-001 given to it by the 1st Respondent on the debt said to be owed.
The 2nd Appellant then averred in paragraph 20 that: –
‘When the rates of interest were adjusted and the wrong charges and penalties were removed the account balance as at the 25th May 2011, when monies belonging to the 2nd Defendant were frozen on the application of the Plaintiff, amounted to =N=130,675,555,46DR. This position was contained in the statement of account created from the reconciliation and which is here titled Oceanic 1st Statement Reconciliation’
It was also the case of the 2nd Appellant in paragraphs 21 and 22 that: –
21. The Consultants also noticed that the sum of =N-66 Million Naira held in deposit which was blocked as security for a =N-60 Million overdraft facility was never credited into the 2nd Defendant?s account. This was despite the fact that the usual practice was to credit the 2nd Defendant?s account with deposits which had matured. In line with banking custom and practice the said sum was credited to the account upon maturity of the facility.
22. A new statement of account which is titled Oceanic 2nd Statement Reconciliation was therefore produced which took this credit into consideration. The result was that the balance on the 2nd defendant’s account with the Plaintiff as at the 25th May 2011 amounted to a credit amount of =N=58,337,708.62.
The 1st Respondent in paragraphs 10, 11 and 12 of the Reply to 2nd Defendant Amended Statement of Defence and Defence to Counter Claim dated 30th November, 2011 said that the facilities granted the 2nd Appellant were operated in its account No: 0911001006090 with International Trust Bank (re numbered 000624203) which the 2nd Appellant stopped servicing before the merger.
The 2nd Appellant conceded in paragraph 6 of the 2nd Defendant/Counter Claimant Amended Reply to Plaintiffs Amended Defence to counter claim dated 12th March, 2012 that its account No.1000-046591-001 later became account No. 0911001006090 with Oceanic Bank International.
In its judgement, the Lower Court found that on the state of pleadings and the evidence placed before it, the Appellants admitted owing the sum of N130,675,555.46 debt to the 1st Respondent on the facility granted to the 2nd Appellant. At page 44 of the judgement, which appears at page 1159 of Vol. 3 of the Record of Appeal, the Lower Court had stated, inter alia, that: –
‘The 2nd Defendant has admitted the sum of 130,675,555.46 as debit balance as at 25th May, 2011 in the account of the 2nd Defendant with the Plaintiff. I will make reference to this figure later in this judgement.’
The next reference made to the figure ?in the judgment is at page 51 thereof, at page 1166 of the Record of Appeal, thus:-
I also hold the view that the 1st and 2nd Defendants are indebted to the Plaintiff in the sum of N130,675,555.46. This is because it is the figure accepted by the 1st and 2nd Defendants to be their debit balance in the 2nd Defendant’s account with the Plaintiff as at 25th May, 2011.
Apparently, the finding by the Lower Court that the 2nd Appellant admitted ‘and accepted’ the sum mentioned was predicated on the 2nd Appellant?s Oceanic Statement Reconciliation put in evidence as Exhibit D3; mentioned in paragraph 20 of the 2nd Defendant Amended Statement of Defence, set out earlier.
By the provision of Section 20 of the Evidence Act, 2011 (Section 19 of the 2004 Act) an admission, for the purpose of evidential proof of a fact, is defined as follows: –
‘An admission is a statement, oral or documentary, or conduct which suggests any inference as to any fact in issue or relevant fact, and which is made by any of the persons, and in the circumstance, hereafter mentioned in this Bill.’ See alsoNigerchin Industries Limited v. Oladehin (2006) ALLFWLR (327) 557, N.A.S. Limited v. UBA (2005) 7 SC (Pt. II) 139, Buhari v. INEC (2008) MJSC (special Edition) 198, Attorney General, Nasarawa State v. Attorney General, Plateau State (2012) 3 MJSC (Pt. III) 118.
Since an admission is a statement; oral or documentary, or conduct which suggests any inference or gives any reasonable impression as to any fact in issue or relevant fact made by a person, the entire facts and circumstances or con in which the statement was made as to any fact in issue or relevant, have to be taken into account or considered in order to determine whether the statement constitutes and amounts to an admission in law or not. See Anason Farms Limited v. NAL Michant Bank (1994) 3 NWLR (331) 241, Nwankwo v. Nwankwo (1995) 5 SCNJ, 44.
For instance, in the determination of whether a party has admitted a fact in issue or relevant to a case in his pleadings, the entire avernments in the pleadings have to be wholistically considered as they represent the case put forward by the party and not one or some only, of the pleadings. See Buhari v. Obasanjo (2005) 13 NWLR (941) 1 @ 71, Ali v. NDIC (2014) LPELR-22422, Titiloye v. Olupo (1991) 7 NWLR (205) 519.
Looking at the aggregate of the facts in the 2nd Appellant?s Amended Statement of Defence, it is clear that even though the 2nd Appellant denied owing the sum shown on the 1st Respondent?s Statement of Account; Exhibit B6 due to alleged wrongful entries of interests, charges, etc, it accepted and stated in paragraph 20, (as shown above) that it engaged a consultant who after reconciliation and the wrong charges and rates of interest were removed, the account showed a debit balance of N130,675,555.46DR as at May 25th, 2011. This is an unequivocal admission and acceptance by the 2nd Appellant that by its own calculations after all its alleged wrong interest rates, charges and penalties were removed by its own consultant, the position of its account with the defunct International Trust Bank was in the debit or debt of the sum stated therein on the report of the consultant. By dint of the provision of Section 23 of the Evidence Act, 2011 (Section 20 of 2004 Act) statements made by person to whom a party to a suit has expressly referred for information in reference to a matter in dispute, are admissions.
The 2nd Appellant’s consultant to whom it referred its complaints and objections on the 1st Respondent’s Statement of Account showing its indebtedness in the account with International Trust Bank returned a verdict in his Report; i.e. Exhibit D3 that, after sifting all the sum on wrong interest rates, charges and penalties from the said account, the 2nd Appellant as at 25th May, 2011, owed a debt of N130,675,555.46DR to the 1st Respondent. The 2nd Appellant cannot later be heard to disown that position by reference to a counter claim which is a separate and distinct action, and which was in respect of a different account allegedly operated or maintained by the 2nd Appellant at International Trust Bank.
The counter claim by 2nd Appellant was independent of the claim by the 1st Respondent against it which was based on the account, admittedly operated and maintained by the 2nd Appellant.
With the clear admission of indebtedness of the sum of N130,675,555.46 by the 2nd Appellant in the account it operated and maintained at International Trust Bank before its takeover by or merger with Oceanic Bank, by the provisions of Section 123 of theEvidence Act, 2011 (Section 75 of 2004 Act) no further proof was required in law for such admitted indebtedness. See Skye Bank Plc v. Akinpelu (2010) 9 NWLR (1198) 179; Attorney General, Nasarawa State v. Attorney General, Plateau State (supra); Bunge v. Governor, Rivers State (2006) ALL FWLR (325) 1 Oseni v. Bajulu (2009) 18 NWLR (1172) 164, Agbanelo v. UBN Limited (2000) 7 NWLR (666) 534. In the circumstances, the burden of proof of the sum admittedly owed by the 2nd Appellant in its pleadings and evidence was obviated by the admission and so the 1st Respondent had no duty to prove the said sum as rightly found by the Lower Court.
It must be pointed out that the Lower Court did not enter judgement for the 1st Respondent on the basis of its statement of account admitted as Exhibit B6, but on the basis of the admission of indebtedness by the 2nd Appellant and so the argument that the 1st Respondent did not prove its claim to be entitled to judgement is non sequitur. The Lower Court had later found that the 1st Respondent did not satisfactorily prove the sum claimed in Exhibit B6 and the finding is the subject of the 1st Respondent’s cross appeal, treated under issue 1 of the 1st Respondent’s Amended brief.
On the 2nd Appellant’s Counter Claim, the case made in paragraph 18 of the Amended Statement of Defence and Counter Claim, was that the 2nd Appellant was granted an overdraft facility vide the offer letter dated 17th November, 2003 for a tenor of 60 days and it was secured by a lien on fixed deposit of N66,000,000.00 held by the 2nd Appellant in the bank. Then as seen earlier, in paragraphs 21 and 22 (set out above) it was averred that the 2nd Appellant?s Consultant noticed that the said sum of 66 Million Naira held in fixed deposit blocked as security for a N60 Million overdraft facility was never credited into its account such that as at 25th May, 2011, the account showed a credit amount of N58,337,708.62 for the 2nd Appellant.
The 1st Respondent’s case was that the facility granted the 2nd Appellant vide the offer letter dated 17th November, 2003 has long been liquidated by it and that claim was not based on the said facility, but on the facility granted the 2nd Appellant vide the offer letter dated 8th March, 2005. See paragraphs 38 and 39 of the 1st Respondent’s Amended Statement of Defence and Defence to the Counter Claim dated 12th March, 2012.
On the state of the pleadings of the counter claim, the evidential burden of proof was on the 2nd Appellant who asserted and alleged the existence of the fixed deposit account and the sum of N66,000,000.00 held therein and that it was used as a security for the facility granted by the offer letter of 17th November, 2003. In addition, it needed to show that the said facility was not liquidated by it at the time International Trust Bank was merged with or taken over by Oceanic Bank and that the lien placed on the account was still extant. It was the 2nd Appellant who was to fail if no evidence at all was called in respect of the counter claim and until it satisfactorily discharged the burden of proof as required by the law in Sections 131, 132, 131(1) and 134 of the Evidence Act, 2011, the counter claim was liable to fail and be dismissed. Daodu v. NNPC (1998) 2 NWLR (138) 355; Kala v. Potiskum (1998) 3 NWLR (540) 1; Itauma v. Akpe-Ime (2000) 7 SC (Pt. II) 24; Alhaji Otaru & Sons Limited v. Idris (1999) 6 NWLR (606) 330, Longe v. FBN Plc (2006) 3 NWLR (967) 228, Agbi v. Ogbeh (2006) 11 NWLR (990) 65.
The Lower Court was right when it stated in its judgement at pages 1161-2 of Vol. 3 of the Record of Appeal that: –
‘In my humble but firm view, where there is a dispute as regard whether or not there was a fixed deposit by the 2nd Defendant, it is the duty of the 2nd Defendant to produce certificate of the fixed deposit or any evidence of lodgement of funds in that regard whether it was by cash or cheque. If it was by cheque, the particulars of the cheque must be shown. If it was by cash the deposit slip issued by the Bank must be provided. If it was by electronic transfer the particulars ought to have been provided. He who asserts must prove. The 2nd Defendant relied on Exhibit D7 being the offer letter for the application for the loan of N60 Million naira wherein the alleged fixed deposit 66 million naira was used as a security. The Plaintiff stated that the facility referred to in Exhibit D7 does not form part of the Plaintiff?s claim in this suit and that the facility has long been liquidated by the 2nd Defendant.
It is my view that the 2nd Defendant ought to have provided evidence of lodgement of the funds as there is a dispute as to whether the facility the fixed deposit was allegedly used as security had been cleared by the 2nd Defendant.’
After a review and assessment of the evidence adduced by the 2nd Appellant through DW2, DW3 and Exhibit D7; letter of offer dated 17th November, 2003, there on the counter claim, the Lower Court, again rightly, concluded at pages 1165-6 of the Record of Appeal that:-
“Based on the evidence before me, I doubt if indeed there was a fixed deposit of 66 Million naira belonging to the 2nd Defendant which has not been liquidated upon maturity before the statement of account was served on the 2nd Defendant on 16/8/2007.”
I should state that neither the oral evidence of DW2 and DW3 nor the Exhibit D7 was credible and sufficient to, prima facie and on the balance of probabilities, show the existence of the alleged fixed deposit account operated by the 2nd Appellant at the material time or that the alleged sum was blocked or a lien placed thereon for the purpose of the facility admittedly granted to the Appellant vide the offer letter of 8th May, 2005 upon which the 1st Respondent?s claim was predicted. In addition, there was no evidence that the facility granted to the 2nd Appellant vide the offer letter dated 17th November, 2003 for which the sum of N66,000,000.00 was used as security had not been fully liquidated and utilized by the 2nd Appellant before it applied for the facility of 8th March, 2005 or before International Trust Bank was merged with Oceanic Bank. It should be remembered that by the terms and conditions in Exhibit D7, the facility of 17th November, 2003 was for and to last for only 60 days tenor and it is not the case of the 2nd Appellant that the facility of 8th March, 2005 was also secured by the alleged fixed deposit account containing the missing N66,000,000.00 to be taken into consideration in the determination of its indebtedness in the account on which the facility was granted.
I agree with the Lower Court when it stated at page 1163 of the Record of Appeal, that:-
I have no doubt in my mind whatsoever that the issue of computing or crediting the alleged fixed deposit of 66 Million naira into the account of the 2nd Defendant was based on assumption.
In the above premises, the 2nd Appellant did not adduce credible evidence in support and proof of its counter claim as required by the law and the Lower Court was right to have dismissed it.
The next issue is on the award of pre-judgement interest on the sum entered in favour of the 1st Respondent. As rightly stated by learned counsel for the parties, the judicial principles of law on the award of pre-judgement interest in cases resulting from commercial transactions, are firmly settled. Broadly, there are two (2) categories of situations in which a Court of law has the power to award interest in a case as follows: –
(1) Where interest is claimed as of right on the basis of agreement or contemplation by the parties, under a recognized mercantile practice or custom or under the principle of equity where the relationship between the parties is/was judiciary. See Texaco Overseas Nigeria Limited v. Pedmer Nigeria Limited (2002) 13 NWLR (785), 526, (2002) FWLR (126) 885, International Trust Bank Plc v. K.H.C. Limited (2006) 3 NWLR (968) 443,Balogun v. E.O.C.B. Nigeria Limited (2007) 5 NWLR (1028) 584. For this type of interest, the law generally requires a party to specifically plead and sufficiently prove the fact of the right to the interest claimed in order to justify the award by the Court. Interest claimed as of right by a party can only be properly awarded on sufficient pleadings and satisfactory evidence in proof thereof by the party. See Daniel Holdings Limited v. UBA Plc (2005) 13 NWLR (943) 533, MECL Limited v. Agility & Brothers Enterprise Nigeria Limited (2006) ALLFWLR (298) 1289, Afribank Nigeria Plc v. Akwara (2006) ALLFWLR (204) 401, Petgas Resources Limited v. Mbanefo.
(2) Where the interest is statutorily provided for, such as in the Rules of a Court where the Court is vested with a discretion to award interest on monetary judgments entered by it. See Haruna Merchants Limited v. Aliyu (1994) 5 NWLR (347) 667, (94) 6 SCNJ (Pt. 1) 87 @ 94-5; Jallco Limited v. Owoniboys Technical Services Limited 4 NWLR (391) 534, (1995) 4 SCNJ, 256 @ 274, G.K.F.I. Nigeria Limited v. NITEL, Plc (2009) 15 NWLR (1164) 344.
The 1st Respondent has claimed interest at the rate of 30% from the 17th May, 2011, until judgment in its statement of claim.
Apparently, being a commercial bank and the transaction which led to the claim, was purely fiduciary, the claim for pre-judgement interest was made as of right even on the basis of recognized merchantile practice and custom in the banking industry. However for the claim to succeed at the rate of interest claimed and the period when it was so chargeable were matters of fact and evidence to be pleaded and proved by the 1st Respondent. However, the award of interest by the Lower Court was not based on the pleadings and evidence of the 1st Respondent, but on admission of indebtedness by the 2nd Appellant to the 1st Respondent. The award of pre-judgement interest by the Lower Court on the admitted sum was at 22% per annum from the 16th May, 2011 until judgement. However, it may be recalled that the admission of the said judgement by the 2nd Appellant was that as at 25th May, 2011, the sum was in debit in its account with International Trust Bank. The correct date for the purpose of the admission was therefore the 25th May, 2011 and not the 15th May, 2011 the date from which the rate of interest was to be charged on the judgment sum.
Learned Counsel for the 2nd Appellant had argued that the 2nd Appellant did not deprive the 1st Respondent of the use of its money since on the application of the 1st Respondent, its money more than that claimed, was put in an account on the order by the Lower Court pending the determination of the case until later when the amount was reduced. According to Counsel, it was the 1st Respondent in the circumstances that deprived the 2nd Appellant of the use of its money while the case lasted in the Court below. All that needs be said on the argument is that though the order by the Lower Court for the initial sum of the 2nd Appellant?s money to be put in an interest yielding account to await the outcome of the case, before the sum was reduced, was made on application by the 1st Respondent, the order was made by the Lower Court in the exercise of its discretion, fully seized of the facts of the claim by the 1st Respondent and the amount sought to be placed in an account pending the determination of the case.
It was the Lower Court and not the 1st Respondent, that had the power to and who made the order for the deposit of the 2nd Appellant’s money in an interest yielding account for the benefit of both parties at the end of the case. While the money was in that account, none of the parties had any form of control over it to be accused of depriving the other of its use as the owner. Even though the 2nd Appellant does not seriously challenge the award of the interest in question, but only the rate awarded, in the case of Ibama v. SPDCN Ltd (1998) 3 NWLR (542) 493 @ 500 and Nig. Gen. Super. Ltd. v. NPA (1990) 1 NWLR (129) 741, it was held that, as a general rule, monetary judgement, usually attracts interest even when none is claimed, particularly in commercial transactions involving financial institutions such as banks based on their merchantile practice and custom.
The 2nd Appellant has not satisfactiously demonstrated in this appeal that the rate of 22% per annum awarded by the Lower Court on the admitted judgement sum as pre-judgement interest was not in line with the rate(s) applicable during the relevant period it was ordered to be charged up to the date of the judgement. Except for the date from which the rate of interest awarded was to be charged; i.e. 16th May, 2011, I do not find reason to warrant interference with the award of the pre-judgement interest by the Lower Court.
I notice that the Appellant’s complaint under the issue is only on the award of the pre-judgement interest and not on the award of post judgement at 10% of the judgement sum from the date of judgement interest by the Lower Court as provided for by its Rules and since there is no complaint from the Appellants in respect thereof, so be it.
The issue is substantially resolved against the Appellants.
The last issue raised by the Appellants is on the award of costs which, it may be remembered, is said by the learned Counsel to be perverse. The law is that, generally, costs follow event and a successful party in litigation is entitled to costs unless there are reason(s), to be shown by a Court, to deprive him of it. See Obayagbona v. Obazee (1972) 5 SC, 246; Amira Nig. Ltd v. Mal. Nig. Ltd (2001) 17 NWLR (742) 464; Idam v. Mene (2009) 17 NWLR (1196) 74. In estimation of costs recoverable and to be awarded to a successful party in a case, expenses on services of Counsel, genuine and reasonable out of pocket expenses incurred in the prosecution of the case and the length of time taken to prosecute the case, are relevant factors to be taken into account by a Court. See Ojiegbe v. Ubani (1961) 2 NSCC, 153; Offshore Constr. Ltd v. Shoreline Lift-Boats Nig. Ltd (2003) 16 NWLR (845) 157 @ 179; Layinka v. Makinde (2002) FWLR (109) 1557, (2002) 10 NWLR (775) 358; Sogunro v. Yeku (2003) 12 NWLR (853) 644 @ 667; ACB Ltd v. Ajugwo (2012) 6 NWLR (1295) 97.
The law is settled that the award of costs by a Court involves the exercise of its judicial discretion, which is required to be exercised judicially, and judiciously; on recognized and established principles and showing discernment and sound reasoning. Odusote v. Odusote (1971) 1 ALLNLR, 219;UBN Ltd v. Nwaokolo (1995) 6 NWLR (400) 127 @ 149, (1995) 4 SCNJ 193; Douglas v. Peterside (1994) 3 NWLR (330) 37; G. K. I. Nig. Ltd v. NITEL (supra); Anyaegbunam v. Osaka (1993) 5 NWLR (294) 449. Costs are therefore not awarded as a punishment against an unsuccessful party or as a bonus to the successful party, but given as compensation and reasonable indemnity for expenses incurred in the initiation and prosecution of a case. Olasope v. NBN (1985) 3 NWLR (2011) 47; Reg. Trustees of Ifeloju v. Kuku (1991) 5 NWLR (189) 65; N. B. C. I. v. Alfyir Nig. Ltd. (1993) 4 NWLR (287) 346 @ 365; Buhari v. Obasanjo (supra); Master Holdings Nig. Ltd v. Okefeina (2011) 6 NWLR (1244) 514.
The award of costs being discretionary, an appellate Court does not ordinarily interfere with the exercise of a discretion by a lower/trial Court that was in a vintage position to fully know and appreciate the facts and circumstances that would justify the order on costs in a case. Unilag v. Aigoro (1985) 1 NWLR (1) 143; Atoyebi v. Bello (1997) 11 NWLR (528) 268; Nwaubani v. Golden Guinea Breweries, Plc. (1995) 6 NWLR (400) 184. In that con, an appellate Court can only interfere with the exercise of a discretion by a lower/trial Court when it is satisfied that the exercise was neither judicial nor judicious as a result of considerations of irrelevant issues or factors or non-consideration of material and relevant facts or misapprehension of the relevant facts or misapplication of established principles of law resulting in the award being arbitrarily excessive or ridiculously low as to make it unsustainable in law for being wrong. See: Elendu v. Ekwoaba (1995) 3 NWLR (386) 704; Ogbuechi v. Gov. of Imo State (1995) 9 NWLR (417) 53; Flemingdon Dv. Nig. Ltd. v. Anaemene (2006) ALLFWLR (301) 1915; Okoye v. N. C. & F. CO. Ltd. (1991) 6 NWLR (199) 501; Adim. v. N. B. C. Ltd (2010) 9 NWLR (1200) 543.
The ground for the complaint by Appellants on the award of costs by the Lower Court, as stated earlier is that the award is perverse. For a decision by a Court of law, which was what the award on costs is, to be perverse, it must be shown not to be based and supported by the relevant and material pleadings and evidence placed before the Court by the parties. In the case of NEPA v. Ososanya (2004) 1 SC (Pt. 1) 159, (2004) 5 NWLR (867) 601, it was held by the apex Court; per Iguh, JSC, that: –
‘A decision of a Court is perverse when it ignores the facts or evidence before it and, when considered as a whole, amounts to a miscarriage of justice.’ See also Atolagbe v. Shorun (1985) 1 NWLR (2) 260; Adimora v. Ajufo (1988) 3 NWLR (80) 1; Agina v. Agina (1991) 4 NWLR (185) 358; CSS Bookshops Ltd v. Rg. T. M. C. Rivers State (2006) ALL FWLR (319) 819; Oladipo v. M. L. G. A. (2010) 5 NWLR (1186) 117.
The Appellants here did not attempt to show that the costs awarded by the Lower Court in favour of the 1st Respondent was not supported or based on the facts and evidence placed before but simply argue that since the 1st Respondent?s case only succeeded partially, it means their own defence also succeeded partially and so it was not equitable to award costs against one party only.
The cost of N30,000.00 awarded to the 1st Respondent in the first instance by the Lower Court was based on success of its claim on admission by the 2nd Appellant and since costs follow event, it was for that success.
The N25,000.00 costs awarded in favour of the 1st Respondent, in the second instance by the Lower Court, was based on the failure by the 2nd Appellant to prove and the consequent dismissal of its counter-claim against the 1st Respondent. The failure by the 2nd Appellant to prove the counter claim and the resultant order for its dismissal are the events followed by the award of the costs in favour of the 1st Respondent for defending of the failed counter claim.
The awards are amply borne out by and based on the facts and evidence before the Lower Court and cannot seriously be said to be perverse.
The facts, evidence, findings by the Lower Court and the law, all attest to the entitlement of the 1st Respondent to the costs awarded and so it was equitable in the circumstances of the case to make the awards. The arguments of the Appellants on the issue are not sustainable in law and it is resolved against them.
In the final result, the appeal is wanting in merit and it fails.
I now turn to the Cross Appeal argued in the 1st Respondent?s Amended brief on Issue 1.
The fulcrum of the 1st Respondent?s submissions on the issue is that since the defence of the 2nd Appellant to its claim was based on the Reports of the Appellants? consultant which were admitted in evidence as Exhibits D3, D4 and D6, were inadmissible in law, the Lower Court ought to have disregarded them even though they were admitted in evidence and to have entered judgement in the sum claimed on the writ and in the statement of claim. It is contended, on the authority of Shanu v. Afribank Nig. Plc. (2002) 17 NWLR (795) 185 @ 221 and 222, that even if the issue of admissibility of the Exhibits was not raised, the Lower Court had the duty to expunge them suo motu at judgement stage if found to be inadmissible in law as it could only act on admissible evidence in its decision. According Counsel, the 1st Respondent?s claim should have been treated as undefended since the 2nd Appellant had admitted that it was granted overdraft facilities by the 1st Respondent, but did not produce evidence that it had repaid them as laid down in Okoli v. More Cab Finance Nig. Ltd. (2007) 14 NWLR (1053) 37. It is maintained that although the case of the 1st Respondent was not brought under the undefended list of the Lower Court, the principles in Okoli?s case apply to it since there was no defence from the 2nd Appellant.
The Court is urged to allow the Cross Appeal and dismiss the Appellants’ appeal in limine.
The Cross Respondents raised and argued two (2) issues on the cross appeal in the Cross Respondents? brief filed on 18th May, 2017, deemed on 14th November, 2018 as follows: –
i. Whether Exhibits D3 and D6 are inadmissible in law. (Ground b of the Cross Appeal)
ii. Whether the learned trial was not right when he refused to grant the Cross Appellant its claim as endorsed on the statement of claim and writ of summons on the ground that it failed to show by credible evidence how it arrived at the figures computed in the Plaintiff’s statement of account. (Ground a and c of the Cross Appeal).
Relying on Apena v. Aiyetobi (1989) 1 NWLR (95) 85 @ 94 and Ize-Iyamu v. Alonge (2008) 21 WRN 103 @ 133, it is submitted that Exhibits D3 and D6 are admissible in evidence since DW2, as an expert, was not a person interested at the time when the proceedings were pending under Section 91 (3) of the Evidence Act, 2004 (Section 83(3) of the 2011 Act) and his Reports were an exception to the provision of the section.
On Issue ii, it is submitted that the Cross Appellant did not prove how it arrived at the sum claimed on the Writ and Statement of Claim and reflected in Exhibit B6. That the evidence of DW2 and Exhibits D3 and D4 show the state of the account which was in credit for the 2nd Cross Respondent. It is the case of the Cross Respondents that by the authority ofBilante v. NDIC (2011) ALLFWLR (598) 804 @ 819, it was not enough for the Cross Appellant to merely tender Exhibit B6, but must go further to prove how the debit balance therein was arrived at which the Lower Court rightly found the Cross Appellant did not do. The case of Okoli v. Morecab Finance Nig. Ltd (supra) is said not to be applicable to the Cross Appellant?s case which was not filed under the undefended list procedure, which is a special procedure and in any case, even if the principle stated therein applied, the Cross Respondents by their pleadings and evidence have shown that they did not owe the debt claimed, but has fully paid the facilities granted to it as per Exhibits D3 and D6 and evidence of DW 2.
In conclusion, the Court is urged to dismiss the Cross Appeal.
In the Cross Appellants’ Reply brief, it is submitted that the Cross Respondents’ Issue 1 did not arise from any of the grounds of the cross appeal and so incompetent on the authority Owner, M/V Gongola Hope v. S. C. Nig. Ltd (2007) 15 NWLR (1056) 189 @ 208-9. It is the contention of the learned Counsel for the Cross Appellant that the finding by the Lower Court that the DW2 was a person interested in the proceedings and that Exhibits produced by him are inadmissible, has not been appealed against by the Cross Respondents and remains binding as was stated in Iyoho v. Effiong (2007) 11 NWLR (1044) 31 @ 55 and P. N. Udoh Trading Co. Ltd v. Abere (2001) 11 NWLR (723) 114. The Court is said to lack the jurisdiction to entertain the Cross Respondents? Issue 1 and urged to discountenance their arguments thereon. The cases of Apena v. Aiyetobi and Ize-Iyamu v. Alongeboth cited by the Cross respondents under the issue are said not to avail them because the leave of Court was sought for the experts therein to prepare reports unlike the Cross Respondents’ case.
In the alternative, it is maintained that DW2 was a person interested in the proceedings and the Reports he produced are inadmissible in evidence by virtue of the provisions of Section 83(3) of the Evidence Act.
On Issue II, it is argued that the Exhibit B6, which is said to speaks for itself, shows the indebtedness of the Cross Respondents to the Cross Appeal and so the Lower Court was wrong to say that the Exhibit was merely dumped on it as the evidence of the witness called by the Cross Appellant was not challenged. Once more, the Court is urged to allow the cross appeal.
I would deal with the objection to the Cross Respondents? Issue I raised by the Cross Appellant. The issue is in the following terms (again):
‘Whether Exhibits D3 and D6 are inadmissible in law. (Ground b of the Cross Appeal).’
Ground ‘b’ of the cross appeal from which the issue is indicated to have been formulated is thus: –
b. The Learned Trial Judge erred in law and on facts when he stated that the Plaintiff did not properly and genuinely raise the issue that the Exhibits D3 and D6 were prepared by persons interested consequently admitted same.
PARTICULARS
i. The Plaintiff raised the issue of the admissibility of Exhibits
ii. and D6 during its final address as a point of law.
ii. The 1st & 2nd Defendants with the leave of Court filed supplementary address to address the said point of law which was responded to by the Plaintiff.
iii. The issue of admissibility of a document which is a point of law can be raised at any point of the proceedings.
iv. Exhibits D3 & D6 were without doubt made during the time the proceedings in the subject suit had commenced at the Lower Court and to the knowledge of the Court.
v. The Plaintiff clearly challenged the said Exhibits D3 & D6 in its reply to Statement of Defence.
Without the need to waste verbiage, even a passing glance at the ground and its particulars would easily show that its purport and substance is a complaint on the admissibility of Exhibits D3 and D6, whether or not the issue was properly raised before the Lower Court.
For that reason, the issue raised by the Cross Respondents from the ground on whether the said Exhibits are inadmissible in law is directly derivable from the ground and so is a competent issue for the purpose of the appeal. The objection is misconceived and over-ruled.
The two (2) issues raised in the Cross Respondents’ brief would be considered together.
The Cross Appellant has argued that the Cross Respondent did not challenge its evidence on the claim it made against them and so the case should have been treated as one brought under the undefended list for judgement to have entered for the sum claimed. Admittedly, the case of the Cross Appellant was not brought or filed under the undefended list of the Lower Court provided for in Order 12 of the 2009 Rules, which allow, under Rule 4, judgement to be entered where a defendant neglects to deliver the notice of defence or is not given leave to defend the action. In National Coordinator/CE v. Mabol & Associates Ltd. (2009) 4 NWLR (1131) 267, it was stated that: –
‘An undefended list procedure is a specialized summary procedure by which a specially endorsed writ is issued in respect of a claim to recover a debt or liquidated money meant to obtain a quick or summary judgement for the Plaintiff in clear cases where the Defendant has no defence to the Plaintiff’s claim.’
The undefended list procedure is a special one specifically provided with procedural steps required to be strictly followed and taken by both the parties and the Court before a case could be heard as undefended and judgement entered therein as per the claims on the originating processes. Whereas the Rules of Court allow that a case brought under the undefended list procedure can be transferred to the general cause list for determination where a Defendant is granted leave to defend the action or as the Court may order, the Rules do not say an action commenced by way of ordinary writ of summons and pleadings duly filed and exchanged therein by the parties, can be converted to one under the undefended list procedure for judgement to be entered there under as per the claims endorsed on the writ or/and statement of claim.
In the Cross Appellant?s case, the facts of the debt claimed were vehemently denied and challenged by the Cross Respondents in their statement of defence thus necessitating the calling of evidence by the parties to prove their respective cases.
With pleadings and evidence placed before the Lower Court, the case before it was clearly taken out of the realm of the undefended list procedure and judgement could only be entered on the merit, after and based on the proper assessment or evaluation of the entire material evidence placed before it and not on the basis that there was on defence to the claim.
The argument by the Cross Appellant that the Lower Court should have entered in the case as an undefended one is misplaced and irrelevant for the purpose of the appeal.
The pith of the Cross Appellant’s case is that Exhibit B6; the Statement of Account, alone was sufficient to show the indebtedness of the Cross Respondents, as it speaks for itself. The Exhibit B6 is at pages 865-7 of Vol. 3 of the Record of Appeal and shows only figures in respect of the Account No. 0911001006090 from 6th February, 2006 to 29th October, 2010 with the last figure of 177,123,739 without any indication of whether it is a debt or credit figure.
I have perused the Statements on Oath of the Cross Appellant’s sole witness; one Bernard Idoko, sworn on 18th May, 2011 which appears at page 38-41 of Vol. 1 of the Record of Appeal and the one sworn on 30th November, 2011 at pages 631-637 of Vol. 3 of the Record of Appeal and note that the witness did not even attempt to explain how the figures entered in Exhibit B6 were arrived at or demonstrate the basis of the dates and figures indicated therein in order to, on the balance of probabilities, show that the 2nd Appellant was in fact, indebted to it for the amount claimed as debt owed on its account. In the case of Wema Bank, Plc v. Osilaru (2008) 10 NWLR (1094) 150, this Court, relying on Yusuf v. ACB (1986) 1-2 SC, 49, and Habeeb Nigeria Bank Limited v. Gift Unique Nigeria Limited (2004) 15 NWLR (896) 405, stated that:
‘It is trite that a bank statement of account is not sufficient explanation of debt and lodgements in a customer’s account to charge the customer with the liability for the overall debit shown in the statement of account. Any bank which is claiming a sum of money on the basis of the overall debit balance of a statement of account must adduce both documentary and oral evidence to show how the overall debit balance was arrived at.’
Again, in the later case of Samabey Int. Commercial Limited v. CELTEL Nigeria Limited (2013) LPELR-20758 (CA) the Court, citing a number of judicial authorities had emphasized that: –
‘It is settled law that a statement of account cannot, on its own, amount to sufficient proof to fix liability on a customer for the overall debit balance shown on the account. Any person who is claiming a sum of money on the basis of the overall debit balance in a statement of account is under an obligation to adduce both documentary and oral evidence explaining clearly the entries therein to show how the overall debit balance was arrived at.’
Among the cases cited by the Court are Co-operative Bank Limited v. Otaigbe (1980) NCLR, 215, Biezan Exclusive Guest House Limited v. Union Homes Savings & Loans Limited (2011) 7 NWLR (1246) 246, Bilante v. NDIC (2011) 15 NWLR (1270) 407. The law is therefore that a Statement of Account, alone, cannot speak for itself in satisfactory proof of a debt shown to be the overall debit entered therein against the holder of the account and that a bank claiming such overall debt balance must go further to adduce evidence; documentary and parole, to demonstrate how the entries in the statement of account were arrived at. Section 51 of the Evidence Act, 2011, supports this judicial position when it provides that: –
‘Entries in books of accounts or electronic records regularly kept in the course of business are admissible whenever they refer to a matter into which the Court has to inquire, but such statement shall not alone be sufficient evidence to charge any person with liability.’ (Underline supplied).
Like I have stated before now, the Cross Appellant did not adduce sufficient evidence; documentary or through its sole witness, to demonstrate and show how the entries on the Exhibits B6, showing overall debit balance in the 2nd Appellant’s account, were arrived at and calculated to give the overall debit balance. The Lower Court was on the firm terrain of the law when in its judgement at page 1157 of Vol. 3 of the Record of Appeal, stated that: –
‘Moreso, the statement of account exhibited by them Exhibit B6 shows transaction in the account from 06/2/2006 to 29/10/2010, whereas the loan was given on 8th March, 2005. The Plaintiff has not been able to discharge this burden. Where specific allegations have been made against it; the Plaintiff sought to have shown to the Court how it arrived at its figure Exhibit B6 not being of an assistance in this regard. The first entry on Exhibit B6 shows a debit balance brought forward from a particular date. How did it arrive at this figure. There is no explanation before the Court. For example on 6/2/2006 the debt balance on the account is 45,034,220. How did it arrive at this figure?
It is not the duty of the Court to embark on a voyage of discovery as investigation is not the function of this Court.
With the failure by the Cross Appellant to discharge the legal obligation of demonstrating and showing by credible evidence how the figures or entries in Exhibit B6 were calculated and arrived at in proof of the overall debit balance shown therein, the 2nd Appellant cannot be charged with the liability for it and the claim for the sum was bound to fail.
In that regard, whether or not the Exhibits D3 and D6 were in law admissible in evidence and should have been expunged by the Lower Court was overtaken by the failure to discharge the initial burden of proof on the part of the Cross Appellant.
However, the law is very well known that a Court of law can only decide dispute between the parties in a case before it on the basis of only admissible evidence in law and that it has the power to expunge or disregard any inadmissible evidence which was admitted, at the trial, in the course of writing its judgement.
The case of Shanu v. Afribank, Plc (supra) also reported in (2002) 6 SC (Pt. II) 135, has put the position beyond argument. See also Shittu v. Fashawe (2005) 7 SC (Pt. II) 107, Onochie v. Odogwe (2006) ALLFWLR (317) 544, Ossai v. Wakwah (2006) NWLR (303) 239, Abubakar v. Chuks (2008) 2 MJSC, 190, Suberu v. State (2010) 8 NWLR (1197) 586, FRN v. Usman (2012) 3 MJSC (Pt. 1) 25. On the admission of the Appellant in its pleadings Exhibit D3 for instance, only contains the same admission pleaded to in paragraph 20 of the 2nd Appellant?s Amended Statement of Defence and Statement of Claim, alluded to earlier, with or without which the admission remains effective as what is admitted requires no further proof, remains the law.
On its part, Exhibit D6, upon which the counter claim by the 2nd Appellant was predicated, was not accorded any probative value by the Lower Court since it found that the existence of the fixed deposit account and the amount allegedly deposited therein, was not satisfactorily proved by the 2nd Appellant. The fixed deposit account upon which a lien was allegedly put by the International Trust Bank for the facility granted the 2nd Appellant vide the offer letter of 17th November, 2003, was the foundation of the counter claim which failed for want of satisfactory proof. So at the end of it all, none of the two (2) Exhibits had any material effect on the decision by the Lower Court in the case.
For the above reasons, I find no merit in the cross appeal and it fails.
On the whole, substantially, the appeal by the Appellant’s is lacking in merit and only succeeds in respect of the date on which the rate of the pre-judgement interest was to commence.
The pre-judgement interest awarded by Lower Court shall be with effect from the 25th May, 2011, the date admitted by the 2nd Appellant to be the date on which the judgement sum was owed by it, to the date of judgement. The appeal is dismissed in all other respects.
The cross appeal for being bereft of merit, is dismissed in its entirety.
The parties shall bear their respective costs of prosecuting the appeals.
JOSEPH SHAGBAOR IKYEGH, J.C.A.: I had the honour of reading in print the robust judgment prepared by my learned brother, Mohammed Lawal Garba, J.C.A., (Hon. P.J.), with which I agree with nothing extra to add. I gratefully adopt it as my judgment.
JAMILU YAMMAMA TUKUR, J.C.A.: My learned brother MOHAMMED LAWAL GARBA JCA afforded me the opportunity of reading in draft before today the lead Judgment just delivered and I agree with the reasoning and conclusion contained therein, I adopt the Judgment as mine with nothing further to add.
Appearances:
L.C. Okoli with him, E.O. PalmerFor Appellant(s)
A.O. Divine with him, Grace Ifeoluwa Afolabi for the Cross Appellants/1st Respondents.
2nd Respondent not represented
For Respondent(s)
