D. RADDA VENTURES (NIG) LTD & ANOR v. UNITY BANK PLC
(2022)LCN/16308(CA)
In The Court Of Appeal
(KADUNA JUDICIAL DIVISION)
On Monday, July 25, 2022
CA/K/37/2018
Before Our Lordships:
Amina Audi Wambai Justice of the Court of Appeal
Abubakar Mahmud Talba Justice of the Court of Appeal
Mohammed Baba Idris Justice of the Court of Appeal
Between
1. D. RADDA VENTURES NIG. LTD. 2. ALHAJI DIKKO UMARU RADDA APPELANT(S)
And
UNITY BANK PLC. RESPONDENT(S)
RATIO:
THE DISCOVERY OF THE COURTS WHEN THERE IS A DISPUTE BETWEEN A BANK AND ITS CUSTOMERS IN RELATION TO THE RECOVERY OF LOAN
Another principle of law to which our attention was drawn and which the Respondent allegedly failed to comply with is that where there is a dispute between a bank and its customers in relation to recovery of loan advanced by the banker to the customer, the questions the Court should consider are whether the Appellant was granted loan by the Respondent if so, how much, what was the interest agreed, how much if any has the Appellants paid out of the loan, but that Respondent did not disclose all these facts which requires explanation by oral evidence to clarify the contentious issues A.C.B PLC V. N.T.S. (NIG) LTD (2007) 1 NWLR (Pt. 1016) 596 at 628 G-H. AMINA AUDI WAMBAI, J.C.A.
THE BEST WAY TO PROVE A PAYMENT INTO A BANK ACCOUNT IS BY THE PRODUCTION OF A BANK TELLER
Payment into a bank account is best proved by the production of a bank teller or an acknowledgement showing on the face of it that the bank has received the payment. The bank teller is usually stamped with official stamp of the bank and initialed by the cashier. It is such a bank teller that prima facie constitutes proof of payment of the sum there in indicated and a customer after producing such a teller or receipt has sufficiently proved payment of the money unless challenged. See SALEH V. BANK OF THE NORTH LTD (2006) 6 NWLR (Pt. 976) 316, UBA PLC V. GODM SHOES INDUSTRIES NIG. PLC (2011) 8 NWLR (Pt. 1256) 590, AEROFLOT V. U.B.A (1986) 3 NWLR (Pt. 27) 188 at 190. The Appellant did not produce any bank teller or any document from the bank acknowledging the receipt of such sums thus their claim was not supported by any documentary evidence as required by law. On this score, the Appellants’ first ground or grudge fails. AMINA AUDI WAMBAI, J.C.A.
THE SETTLED LAW IN A CLAIM FOR UNPAID DEBT OR LOAN
It is settled law that in a claim for unpaid debt or loan where the overall debit balance is disputed, the statement of account alone cannot on its own amount to sufficient proof to fix liability on the customer. The person claiming the sum on the basis of the overall debit balance mustadduce both documentary and oral evidence to explain clearly the entries in the account and how the overall debit balance was arrived at. See BILANTE INTERNATIONAL LTD V. NDIC (2011) ALL FWLR (Pt. 598) 804, NAGEBU V. UNITY BANK PLC (2013) ALL FWLR (Pt. 698) 881. AMINA AUDI WAMBAI, J.C.A.
AMINA AUDI WAMBAI, J.C.A. (Delivering the Leading Judgment): This appeal is against the judgment of the Kaduna State High Court in suit No KDH/KAD/999/2012 delivered by Hon. Justice Bashir Sukola on 5th February 2014 wherein summary judgment was entered in favor of the Respondent (Plaintiffs therein) against the Appellants (Defendant therein)
By its writ of summons and paragraph 10 (a) (b) (c) of its Statement of Claim, the Respondent as Plaintiff Claimed the following reliefs.
(a) The sum of Forty-Nine Million and Twenty Five Thousand, Four Hundred and Ninety Three Naira, Forty Nine Kobo (N49,025,493.49k) only being the money payable by the Defendants to the plaintiff for the money lent by the plaintiff to the first Defendant as its Bankers and at its request and for interest agreed to be paid on money due as at the close of business on the 21st day of December, 2011.
(b) Interest at the rate of 21% per annum from 1st day of January, 2015 until payment or judgment and 10% thereafter until final payment.
(c) The plaintiff also claims cost of bringing this action.
He also filed a motion on Notice for summary judgment accompanied with a 12 paragraph affidavit, a written address and some documents.
Upon being served with the processes, the Appellants as defendants/counter-claimants filed a statement of defence and counter-claim with the necessary processes, a counter-affidavit of 26 paragraphs and a written address.
In his ruling, the learned trial Judge reviewed the affidavit evidence of both parties and arrived at the conclusion that the Appellants have no good defence to the Respondent’s claim and accordingly entered summary judgment in favor of the Respondent. In doing so the Court found inter alia.
“The Defendant’s statement of account against the 21–12–11 shows a debit balance of N49,025,493.40 unpaid by the Defendant.
On the other hand, the defendants by paragraph 8 of its counter affidavit shows that they made certain payments into its account without attaching proof of bank tellers evidencing the said deposits.
The claims by the Defendants of effecting payments into its account with the plaintiff is not backed up by any document in the nature of a teller orany negotiable instrument. I find these claims unproved and fail to counter the documentary evidence attached by the plaintiffs and served on the defendants.”
It concluded
“In consequence, therefore, judgment is summarily hereby entered for the plaintiff and against the Defendants jointly and severally per the plaintiff’s Writ of Summons and paragraph 10 (a) and (b) of the plaintiff’s Statement of Claim dated 28/11/2012.“
Upset by the decision, the Appellants commenced this appeal by a Notice of appeal filed on 14/02/2014 containing five grounds of appeal.
In the Appellant’s brief of argument filed on 1/2/2019 and settled by S.A. Audu, ESQ two issues were nominated for determination, to wit:-
(1) Whether the trial lower Court was right when it entered summary judgment in favour of the Respondent when from the Appellant’s statement of Defence, Counter affidavit and written address, the Appellant raised triable issues that required the suit to be transferred to the general cause list and tried on its merit (Grounds 1, 2, 3 and 4)
(2) Whether the learned trial Judge has a legal duty to hear,determine and make pronouncement on the Appellants’ Counter–Claim which is a distinct suit from the main suit (Ground 5).
The Respondent did not file any brief of argument nor was here presented at the hearing of the appeal on 2/6/2022 though was served hearing Notice. This appeal was therefore heard only on the Appellant’s brief of argument.
A sole issue is sufficient to determine this appeal as couched below:
WHETHER THE TRIAL COURT WAS RIGHT WHEN IT ENTERED SUMMARY JUDGMENT FOR THE RESPONDENT AND DISMISSED THE APPELLANT’S COUNTER-CLAIM.
APPELLANTS’ SUBMISSION
Arguing his issue NO 1, learned Counsel submitted that the Respondent did not attach any documentary evidence/Exhibit to the affidavit in support of the application for summary judgment but the learned trial Judge in entering judgment for the Respondent held that the plaintiff (now Respondent) annexed documents executed by both parties regarding the loan the plaintiff/Respondent granted to the defendants/Appellants. The lower Court, learned Counsel argued, was thus in grave error to have referred to none existent documents.
Learned Counselreferred to the averments at paragraphs 1-22 in the statement of defence and counter-claim, and depositions at paragraphs 1-26 of the counter-affidavit to argue that had the learned trial Judge averted his mind to the Communal reading of the averments he would have ordered a trial on merit rather than enter summary judgment for the Respondent.
According to him, once a defendant by his affidavit shows that he has a good defence or a fair case of defence or raises a triable issue as the Appellants have done here, such a defendant should be allowed to defend the suit calling in aid the cases of NKWO MARKEY V. OBI (2010) 4 SCNJ 81 @ 95, MAC GRESOR ASSOCIATES LTD V. NIG. MERCHURHY BANK LTD (1996) 2 SCNJ 72 @ 82 and Order 11 Rule 4 of the Rules of the lower Court, 2007.
Demonstrating that the Appellants have a good defence, learned Counsel argued that the Respondent did not produce the up-to-date Appellants’ statement of account as the payments by the Appellants in 2012 were not exhibited contending that such failure attracts the invocation of Section 167 (d) of the Evidence Act for withholding the statement of account citing the cases of UNION BANK OF NIG.PLC V. BORINI PRONO CO. LTD (1998) 4 NWLR (Pt. 547)- 640 at 653 A-G and OCHIN V. EKPECHI (2000) 5 NWLR (Pt. 656) 225 at 242. He also itemized the arbitrary and unilateral interests charged by the Respondent contrary to the conditions agreed by the parties as highlighted at paragraphs 6–17 of the counter – affidavit at pages 52–54 of the record which he contended raises triable issue requiring explanation by the Respondent, by calling oral evidence.
Further to this, Counsel submitted that the Appellants also rely on the defence of fraud which they pleaded and particularized at paragraph 18 of the statement of defence stressing that interest on loan granted must be arrived at upon calculation of agreed rates having regards to the period covered in the computation.
Still on the statement of account it was submitted that it is not a sufficient explanation of the debit and lodgments in the customer’s account but that a bank claiming a sum of money on the basis of the overall balance therein must adduce both documentary and oral evidence to show how the overall debit balance was arrived at citing the cases of WEMA BANK PLC V. OSILARU (2008) 10 NWLR (Pt.1094) 150 at 179-180 YESUFU V. A. C.B. (1986) 1-2 SC 49, FIRST BANK OF NIG PLC V. A. MAMMAN (NIG) LTD (2001) FNLR (Pt. 31) 2890.
Another principle of law to which our attention was drawn and which the Respondent allegedly failed to comply with is that where there is a dispute between a bank and its customers in relation to recovery of loan advanced by the banker to the customer, the questions the Court should consider are whether the Appellant was granted loan by the Respondent if so, how much, what was the interest agreed, how much if any has the Appellants paid out of the loan, but that Respondent did not disclose all these facts which requires explanation by oral evidence to clarify the contentious issues A.C.B PLC V. N.T.S. (NIG) LTD (2007) 1 NWLR (Pt. 1016) 596 at 628 G-H.
Learned Counsel also opined that the lower Court did not appreciate that the summary judgment procedure is not aimed at shutting out a defendant who shows that he has a good defence. NISHI ZAWA V. JETHWANI, (1984) ALL NLR 420, nor is the trial Judge to decide at that stage whether the defence put up by the defendant in the affidavit will succeedbut only to see whether the defendant has disclosed a dispute between the parties. That the Appellants did show that they made out a prime facie defence,IMONIYAME V. SONEB ENTERPRISES (2010) 1 SCNJ 303 at 321.
As to what constitutes or gives rise to a triable issue, the cases of ATAGUBA & CO. V. GURA (NIG) LTD(2005) 8 NWLR (Pt. 927) 429 G.M.O. NWORAH & SONS CO. LTD V. AFAM AKPUTA ESQ (2010) 9 NWLR (Pt.1200) 443, SPD (NIG) LTD V. ARHOJOE (NIG) LTD (2006) 3 NWLR (Pt. 966) 173 at 190-191 were cited.
It was also his submission that the Respondent’s claim does not fall within the cases to be determined by the summary judgment procedure as there are serious and contentious dispute between the parties.
On their issue 2 dealing with the non-consideration of their counter-claim by the lower Court which they contend is erroneous, it was submitted that a counter-claim being a separate action, it is necessary for the plaintiff to file a defence against it in order to join issues with the counter-claimant and where the plaintiff fails to do so, he will be deemed to have admitted the counter-claim and the counter-claim deemed uncontroverted.NIG. HOUSING DEVELOPMENT SOCIETY LTD. V. YAYA MUMUNI (1972) 2 SC 57 at 58-86, OGBONNA V. A.G. IMO STATE (1992) 1 NWLR (Pt. 647) 698.
In further argument, it was contented that the fate of a counter-claim does not depend on the plaintiff’s claim nor fail merely because the main claim by the opposite party succeeded JERIC NIG.LTD V. U.B.N. (2000) 12 SCNJ 184 at 187-188. Thus, he submitted the failure of the learned trial Judge to consider the counter–claim amounts to breach of the Appellant’s right to fair hearing, urging us to so do and resolve the issue and the appeal in favour of the Appellants.
RESOLUTION OF APPEAL
The pertinent question is whether by the averments in the statement of defence and depositions in the counter-affidavit, the Appellants raised triable issue or a good defence warranting the hearing of the matter on merit.
Parties are in agreement on the principal sum of the facility granted to the Appellants by the Respondent. By paragraph 4 of the statement of claim and the document titled: “APPROVAL OF CREDIT FACILITY’’ (The loan agreement) at pages 17 to 19 of the record, the amount wasN24,000,000,000.
The dispute pertains only to the accrued interests and how the outstanding debit balance of N49,025,493,49 was arrived at. The Appellants’ grounds for challenging the outstanding debit balance are captured at paragraph 18 of the statement of defence and deposed to at paragraphs 6 to 17 of the counter-affidavit. These are principally that:
1. Some repayment made by the Appellants are not reflated in the statement of account but Respondent withheld the true position of the statement of account; unilaterally and charged commission on OD. (paragraphs 6-8,10)
2. The Respondent unilaterally and arbitrarily charged the 1st Appellant 0.75% charges on O D twice on 30th day of July 2010, 0.75% truck leasing facility charges on 31st Dec, 2010 and 2% charges on 14/6/2011 outside the terms and conditions of approved credit facility (paragraph 13).
3. The agreed interest rate is 18% per annum flat and the Respondent never notified the Appellants of any change in the interest rate but Respondent in irregular manner debited the 1st Appellant’s account arbitrarily and without knowledge (paragraphs 14 and 23.
4. Theappellants are not indebted to the Respondent in the sum of N49,025,493,49 claimed or for the other reliefs. (paragraphs 16 and 24).
On the 1st Appellant’s 1st claim of repayments made but not reflected in the statement of account, the 2nd Appellant deposed at paragraph 8
“That all the repayments made by the First Respondent in year 2012 to wit; N7,044,756.00 on the 7th day of February, 2012, N4,300,000.00 on the 28th day of March, 2012 N2,150,000.00 on the 3rd day of October, 2012 and to mention but a few were not reflected in the statement of account exhibited by the Appellant in this suit.”
The lower Court as earlier reproduced held that the said payments into the account was not backed up by any document and that the claim was not proved. The learned trial Judge was right.
Payment into a bank account is best proved by the production of a bank teller or an acknowledgement showing on the face of it that the bank has received the payment. The bank teller is usually stamped with official stamp of the bank and initialed by the cashier. It is such a bank teller that prima facie constitutes proof of payment of the sum there in indicated and a customer after producing such a teller or receipt has sufficiently proved payment of the money unless challenged. See SALEH V. BANK OF THE NORTH LTD (2006) 6 NWLR (Pt. 976) 316, UBA PLC V. GODM SHOES INDUSTRIES NIG. PLC (2011) 8 NWLR (Pt. 1256) 590, AEROFLOT V. U.B.A (1986) 3 NWLR (Pt. 27) 188 at 190. The Appellant did not produce any bank teller or any document from the bank acknowledging the receipt of such sums thus their claim was not supported by any documentary evidence as required by law. On this score, the Appellants’ first ground or grudge fails.
The second ground is the unilateral and arbitrary 0.75% charges on OD twice on 30/7/2010; 0.75% truck hearing facility charges on 31/12/2010 etc.
The Appellant’s statement of account is at pages 25 to 29 of the record. A look at page 28 confirms the Appellant’s complaint of the 0.75% charges being reflected twice on the same 30/7/2010. The reason for such double deduction is not deducible from the Statement of account. Why the same was charged twice on the same 30/7/2010? The statement of account provides no answer and there is no other document front-loaded to explain thisapparent anomaly or an unusual occurrence. The answer can only be found in the realm of speculation which is not a feature of law.
A Court of law relies on evidence in resolving disputes and not on speculation. The Courts are prohibited from embarking on speculation.
It is indeed unheard of that interest is chargeable on the same item twice on the same day. Whereas it is so indicated in the statement of account such happens, then it calls for explanation by the Bank why the same interest will be charged on the same item twice on the same day; more so that the said double daily interest affects the overall debit balance outstanding against the Appellants.
The 3rd main complaint is that the agreed interest rate between the parties is 18% flat and the Respondent who has charged higher interest rate did not notify them of any change in the rate. It is not in doubt that by the other conditions of the loan agreement, the bank reserves the right to alter any of the terms and or conditions attached to the facility without recourse to the obligor should the need to alter any term/condition arises (see page 31 of the record).
However, the fact that the bankreserves the right to alter the interest rate at any time does not obviate the necessity to inform the Appellant of any variation as at when affected. None of the documents attached to the motion notified the Appellants of any variation of the interest rate. Neither the demand notice on 17th February 2010 nor the document dated 27/5/2010 titled: “Perfection of equitable mortgage held in respect of your credit facility” gives notice of alteration/variation in the interest rate. The Appellants are entitled to be so notified. Having not notified the Appellants of variation in the interest rate and explained the double interest on OD charged on 30/7/2018, these facts in my humble view raise sufficient triable issue and put to question the actual outstanding debit balance against the Appellants warranting the lower Court to have heard the matter on merit.
It is settled law that in a claim for unpaid debt or loan where the overall debit balance is disputed, the statement of account alone cannot on its own amount to sufficient proof to fix liability on the customer. The person claiming the sum on the basis of the overall debit balance must adduce both documentary and oral evidence to explain clearly the entries in the account and how the overall debit balance was arrived at. See BILANTE INTERNATIONAL LTD V. NDIC (2011) ALL FWLR (Pt. 598) 804, NAGEBU V. UNITY BANK PLC (2013) ALL FWLR (Pt. 698) 881.
As earlier stated the summary judgment procedure is not meant to shut out a defendant who has a good defence and not merely a sham defence. In the instant case, the Appellant’s affidavits have shown that the Appellants have good defence to the claim or at least triable issue that can only be resolved by oral evidence. The apparent unexplained wrong entries in the statement of account which were computed in arriving at the outstanding debit balance raised a trial issue warranting the hearing of the case on merit for the bank to offer an explanation. I am therefore in agreement with the learned Appellants’ Counsel that the Appellants ought to have been granted leave to defend the suit. In the circumstance, I find merit in this appeal and resolve the issue in favour of the Appellants. In the consequence thereof the decision of the lower Court entering summary judgment for the Respondent is set aside. I order that the matter be remitted to the Hon. Chief Judge of Kaduna State for hearing on merit.
Appellant is entitled to cost of N50,000.
ABUBAKAR MAHMUD TALBA, J.C.A.: I had the opportunity of reading in draft, the leading judgment just delivered by my learned brother AMINA AUDI WAMBAI, JCA. A careful perusal of the Appellants’ affidavit shows that the Appellant has a good defence to the claim. In other words, the Appellants’ affidavit have disclosed a triable issue which can only be resolved by oral evidence. It is crystal clear that there are unexplained wrong entries in the statement of account which were computed in arriving at the outstanding debit balance it raises a contentious issue that can be resolved only by being tried. The Court owes it a duty to scrutinize the claims and the verifying affidavit with the attached documents, if any, to ensure that the claim is indeed suitable to be heard under the undefended list procedure. The moment the Court finds that there are issues which require some explanation the case should be transferred to the general cause list for hearing. See Intercontinental Bank Ltd v. Brifina Ltd (2012) 13 NWLR (Pt. 1316) 1 (SC).
In this instant case, the Appellants ought to have been granted leave to defend the suit. Hence this appeal is meritorious and it is allowed.
I abide by the consequential order(s) in the leading judgment.
MOHAMMED BABA IDRIS, J.C.A.: I have had the benefit of reading in draft the lead judgment of my learned brother, Amina Audi Wambi, JCA, just delivered. I agree with the reasoning and conclusion reached. I do not have anything useful to add. I abide by all the orders made therein.
Appearances:
S.A. AUDU. For Appellant(s)
G. GOBIR, ESQ, For Respondent(s)