DIAMOND BANK LIMITED v. PAMOB WEST-AFRICA LIMITED (2014)

DIAMOND BANK LIMITED v. PAMOB WEST-AFRICA LIMITED

(2014)LCN/7656(CA)

In The Court of Appeal of Nigeria

On Tuesday, the 9th day of December, 2014

CA/E/17/2008

RATIO

EVIDENCE: BURDEN OF PROOF; WHO HAS THE BURDEN OF PROOF IN A SUIT

COURT: DUTY OF COURTS; THE DUTY OF THE TRIAL COURT TO EVALUATE AND ASCRIBE PROBATIVE VALUE TO THE EVIDENCE OF WITNESSES

It is also the law that evaluation and ascription of probative value to the evidence of witnesses is the primary duty of the trial court who has the privilege of watching and hearing the witnesses and their demeanour but as regards documentary evidence, an appellate court is in as good position as the trial court to conduct the evaluation and form its own opinion on them. per. MISITURA OMODERE BOLAJI-YUSUFF, J.C.A.

COURT: DUTY OF COURTS; THE FACT FINDING DUTY OF THE TRIAL COURT

DAMAGES: GENERAL DAMAGES; HOW TO MEASURE DAMAGES FOR BREACH OF CONTRACT

The claim for general damages simply by the respondent in this case is inappropriate. In the law of contract, there is no dichotomy between special and general damages. It is settled that the measure of damages for breach of contract is the loss flowing naturally from the breach and is reasonably within the contemplation of the parties at the time of contract. Apart from damages naturally resulting from the breach, no other form of general damages can be contemplated. See Chitex Industries Ltd Vs Oceanic Bank Ltd (2005) 8 SCM page 53 at 59-60 where the Supreme Court stated the principle governing damages recoverable for breach of contract as follows:
“Generally the amount of damages to be paid to a person for breach of contract is the amount it will entail to put that person in the position he would have been if there had not been any breach of contract See IDAHOSA VS ORONSAYE (1959) 4 F.S.C. 166. In the case OMOUNUWA VS WAHABI (1926) 4 SC 37, this Court per Idigbe JSC said:
“It is settled that the governing purposes of damages is to put the party whose rights have been violated in the same position, so far as money can do as if the rights have been observed, xxxxxx.
In cases of breach of contract the aggrieved party is only entitled to recover such part of the loss actually resulting as was at the time of the contract reasonably foreseeable as liable to result from the breach. What was at that time reasonably so foreseeable depends on the knowledge then possessed by the parties or, at all events by the party who later commits breach of contract xxxxxxxxx
In cases of breach of contract a plaintiff is only entitled to damages naturally flowing or resulting from the breach. See SWISS NIGERIAN WOOD INDUSTRIES IETD Vs DOGO (1971) 1 UILR 337, AGBAJE VS NATIONAL MOTORS (1971) 1 UILR 119. The measure of damages, in such cases of breach of contract, is in the terms of the loss which is reasonably within the contemplation of the parties at the time of contract. See WROUGHT IRONN (1970) NCCR 295. ATRAINE Vs ESHTETTT (1977) 1 SC 89. When considering damages arising from a breach of a contract there is no room for damages which are merely speculative or sentimental unless these are specifically provided for by the express terms of the contract.” per. MISITURA OMODERE BOLAJI-YUSUFF, J.C.A.

Before Their Lordships

AMIRU SANUSIJustice of The Court of Appeal of Nigeria

EMMANUEL AKOMAYE AGIMJustice of The Court of Appeal of Nigeria

MISITURA OMODERE BOLAJI-YUSUFFJustice of The Court of Appeal of Nigeria

Between

DIAMOND BANK LIMITEDAppellant(s)

AND

PAMOB WEST-AFRICA LIMITEDRespondent(s)

MISITURA OMODERE BOLAJI-YUSUFF, J.C.A. (Delivering The Leading Judgment): The Respondent herein as the plaintiff before the High Court of Anambra State, Onitsha Judicial Division in its Amended Statement of Claim claimed a sum of N10,000,000.00 (Ten Million Naira) as general damages for breach of contract by the appellant. The respondent’s case is that the respondent applied for a letter of credit for the sum of N100,000.00 (one hundred thousand dollars) from the appellant at its Onitsha branch. The appellant approved and issued a letter of credit for $83,500.00 (Eighty three Thousand, Five Hundred Dollars) and for which form ‘M’ was completed by the respondent and required documents were collected from the respondent. The appellant by its letter of 18th October, 1993 cancelled the letter of credit granted to the respondent and returned the respondent’s documents.

By its 2nd further amended statement of defence, the appellant’s case was that its acceptance to bid for foreign exchange on behalf of the respondent at central Bank of Nigeria did not amount to an approval of allocation of foreign exchange or issuance of letters of credit to the respondent. The Federal Government of Nigeria disburses foreign exchange to the central Bank of Nigeria to allocate same to genuine importers by biding system done through the banks as agents of the importers. The appellant’s bids at auctions 34 and 35 conducted at the central Bank of Nigeria on 30/9/93 and 7/10/93 were unsuccessful. The appellant included the respondent’s name in its bid schedule at Auction 35 fixed for 14/10/93 but had to withdraw the item because the respondent cancelled its request for foreign exchange and demanded for the return of its documents by its letter dated 13/10/93.

The court below after hearing witnesses of both parties and considering the documents tendered awarded a sum of N2,000,000:00 (two million naira) as general damages in favour of the respondent for breach of contract by the appellant. The judgment was delivered on 29th June, 2006.

The appellant is aggrieved by that judgment and has appealed to this court on 8 grounds contained in the Amended Notice of Appeal dated 7th November, 2008 and deemed as properly filed on 5th March, 2009. Briefs of Argument were filed and exchanged by counsel. The appellant’s brief of argument is dated 11th March, 2009 and filed on 31st March, 2009. It was deemed as properly filed on 25th October, 2010. The respondent’s brief of argument is dated 23rd November, 2010 and filed on the same day. The appellant’s reply brief is dated 25th February, 2011 and filed 25th February, 2011. It was deemed as properly filed on 26th February, 2013. The respondent’s reply on points of law in respect of preliminary objection is dated 5th March, 2013 and filed on the same day. All the briefs were adopted on 27th October, 2014.

The respondent filed a notice of preliminary objection dated 23rd November, 2010 and filed on the same day. The grounds of the objection are:
1. Issue No. 1 formulated by the appellant/respondent is incompetent as it does not relate to any of the grounds of appeal contained in the Appellant’s Amended Notice of Appeal and ought not to have been argued with incompetent ground 7 of the Amended Notice of Appeal.
2. Ground 7 of the appellant’s Amended Notice of Appeal is incompetent as the particulars of the ground of appeal does not relate to the ground of appeal.
3. The brief of argument filed by the appellant/respondent is incompetent for failure of the appellant to pay necessary fees as prescribed by the Court of Appeal rules 2007.

The argument in support of the objection was incorporated into the respondent’s brief. At the hearing of the appeal, the learned respondent’s counsel withdrew grounds 1 and 2 and the arguments in support and they were struck out.

On ground 3 which is failure to pay necessary fee prescribed by the rules of this court, counsel submitted that the appellant’s 45 days within which to file its brief started running from 28/5/2008 when the record of appeal was deemed properly filed. According to him, the appellant filed its brief on 31st March, 2009 and paid filing fee of N2,000.00 (Two Thousand Naira). The appellant was granted extension of time up till 25th October, 2010 to the its brief. He argued that by the Court of Appeal Rules, 2007, the appellant is statutorily required to pay one hundred naira (N100,00) per day for 835 days for failure to file its brief up and until 25th October, 2007. He submitted that non-payment of the required statutory fee renders the appellant’s brief filed out of time incompetent and not properly filed before this court and consequently robs this court of the jurisdiction to entertain this appeal, he relied on Ukpabio Vs N.F.V.C.B (2008) 9 NWLR pt.1092 page 219 at 244-245 (H-A), Ukangwu vs Pitt (2009) 9 NWLR Pt.1147 page 465 at 471 (F-H), Ekpeto vs Wanogho (2001) 8 NWLR Pt.716 page 665 at 667(6). He urged the court to discountenance the appellant’s brief and dismiss the appeal.

The appellant’s counsel in his reply brief submitted that failure to pay filing fees is different from failure to pay penalty for late filing of brief. He further submitted that the authorities relied on by the respondent’s counsel relate to non-payment of filing fees and therefore inapplicable to the present case. He argued that the appellant’s brief having been deemed properly filed and served without an objection from the respondent’s counsel, this court cannot turn round to set aside its own ruling by holding that the appellant’s brief is incompetent. He argued further that what the respondent’s counsel is asking this court to do is to sit on appeal over its own ruling. He relied on Buhari vs. Obasanjo (2005) All FWLR (Pt.273) page 1 at 100 (F-G). He urged the court to overrule the objection.

In his reply on points of law in respect of the objection, the respondent’s counsel argued that failure to raise objection to the appellant’s application for extension of time to file its brief and to deem same as properly filed and served cannot amount to waiver of payment of mandatory filing fee as the law is clear that parties cannot by consent waive mandatory provisions of statute. He submitted that the appellant had enough time since the preliminary objection was raised to pay the fee but chose to take cover under the ruling of the court.

By virtue of Order 12 Rule 1 of the Court of Appeal Rules 2007 and part A of the Third Schedule thereto, the fee for filing of brief of argument is N2,000.00 (Two thousand Naira) and N100.00 (One hundred naira) for each additional day thereof for failure to file brief within the prescribed period. The N2, 000.00 prescribed for filing was paid. The additional fee of N100.00 (One Hundred Naira) per day was not paid. The appellant applied for an order to deem his brief filed out of time as properly filed and served and the application was granted. Thus the appellant’s brief has already been regularized whether rightly or wrongly and cannot be revisited by this court. The respondent’s objection ought to have been raised at the time the appellant moved the court to regularize his brief and not after the brief has been regularized. The style of the respondent’s counsel amount to intentionally laying an ambush for the appellant so as to score a technical victory thus making litigation to look like a game of chess.

I am of the view that failure to pay the prescribed penalty is an irregularity which does not render the brief void since it can be rectified if brought to the attention of the court at the appropriate time . Where the brief has been regularized by an order of court pursuant to a formal application to the court by the appellant which a respondent had the opportunity to oppose but chose not to do so, the respondent has waived his right to complain about the incompetency. I am of the view that the contention of the appellant’s counsel that the fee for filing a brief of argument is different from the fee prescribed for failure to file a brief within time is correct. Though the two fees are prescribed by the rules, the consequence of failure to pay each set of fee are not the same. While payment of the filing fee is a condition precedent to the exercise of jurisdiction by the court, failure to pay the penalty for filing outside the prescribed period is an irregularity which if brought to the attention of the court at the appropriate time can be rectified. For these reasons, the preliminary objection is hereby overruled.

In respect of the substantive appeal, the appellant’s counsel distilled four issues for determination as follows:
1. Whether the respondent established its claim that the appellant agreed to source for foreign exchange on behalf of the respondent via Export proceeds.
2. Whether the appellant opened or issued a letter of credit on behalf of the respondent and later cancelled same. Thus resulting in a breach of contract.
3. Whether the respondent’s claim and evidence led in proof of General Damages for breach of contract and learned trial judge’s award of general damages for breach of contract were in law competent or tenable, and whether the amount of damages awarded was not excessive.
4. Whether the respondent established its claim on a balance of probabilities.
The respondent’s counsel formulated the following issues for determination.
1. Whether the learned trial judge misdirected himself in evaluating and ascribing probative value to Exhibits “R” and “A” and in finding as a fact that the respondent’s application to the appellant for foreign exchange was through the appellant’s export process and not through CBN foreign exchange market.
2. Whether the learned trial judge misdirected himself by holding that the appellant opened a letter of credit for the respondent and later cancelled it thus putting an end to the contract resulting in breach of contract.
3. Whether the learned trial judge erred in law by awarding general damages to the respondent in an action for breach of contract, and whether the general damages of two million naira (2,000000.00) awarded by the trial judge is excessive.
4. Whether considering the totality of the evidence adduced at the trial, the learned trial judge failed to appreciate upon preponderance of evidence which side the scale weighed having regard to the burden of proof.

I have compared the issues formulated by both counsel, the issues are the same but couched in different words. I will for the purpose of determining this appeal utilizes the issues formulated by the appellant’s counsel; I find them to be clearer.

On issue 1, which is about the agreed source of the foreign, the appellant’s counsel submitted that PW1’s evidence on direct allocation of foreign exchange is at variance with the respondent’s pleading in paragraph 5(a) of the Amended Statement of Claim where it is averred that the respondent applied for sourcing of foreign exchange through export proceeds which is by sourcing for foreign exchange through parallel market. Counsel referred to each of the exhibits tendered at the court below including exhibit Q (The Statement of claim filed on 26th January, 1994), he submitted that the story of sourcing for foreign exchange through export proceeds is an afterthought as it came 3 years after the commencement of this suit. He further submitted that neither party led evidence to the effect that a bid form is an internal document of any bank which every importer is supposed to fill, the learned trial judge simply imported that piece of evidence on his own into the judgment.

The respondent’s counsel in response submitted that the onus of proving that exhibit R is not a Diamond Bank Ltd Bid Form, that it is the Central Bank of Nigeria’s Bid Form and that the appellant went for bidding is on the appellant which the appellant did not discharge. On exhibit A which is the note on the complimentary card of the appellant’s manager, counsel submitted that the content of exhibit A is very clear and unambiguous and should be allowed to speak for itself, he relied on Emefuna Vs Ngwu Mohaike (1993) 3 NWLR PT.283 Page 612 at 626.

In reply, the appellant’s counsel submitted that the mere admission of the respondent that it signed exhibit “R” which was an instruction to source foreign exchange on its behalf from the Central Bank of Nigeria ran violently in conflict with the respondent’s case.

It is most appropriate to start the consideration of this issue from the pleading of both parties. The law is trite that parties are bound by their pleadings. The averments of the respondent in respect of this issue can be found in paragraphs 2, 3, and 5a of the Amended Statement of Claim on pages 17-19 of the Record of Appeal. The averments are reproduced below:
“2. In September, 1993 the plaintiff applied for a letter of credit from the Defendant’s Bank at the Onitsha branch to the tune of $100,000.00 (One Hundred Thousand Dollars). Consequent upon the said application, the Defendant through its Branch Manager confirmed in writing that the defendant can only approve $83,500 (Eighty Three Thousand five Hundred dollars) and asked the Plaintiff to amend its form “M” accordingly. The written document by the said Branch Manager will be founded upon at the trial.
3. As a result of the foregoing, to plaintiff applied for $83,500 (Eighty three Thousand Five Hundred Dollars) which the Defendant accordingly approved following the approval by the defendant of the letter of credit to the tune of $83,500 (Eighty three Thousand Five Hundred dollars). The Defendant approved in our client’s favour form “M” and entered No.B/A 930992 in the form. Thereupon the Defendant collected the following documents from the plaintiff:-
a. Proforma invoice No. VP 196 96/93
b. Set of Form “M” N. MB 796775 (2 copies)
c. Form C3, 1 No 339717 (2 Copies)
d. P. I. D. D. No 8605850
e. Insurance Certificate No 545586
f. Tax Clearance
g. Certificate of Incorporation. The documents stated as (a) to (e) in this paragraph will be relied upon at the trial,
5. Surprisingly by the Defendant’s letter of October 18, 1993 with reference No DBL/ON/93/CWC/62/02 to our client the Defendant cancelled the letter of credit which it earlier granted the plaintiff. This is a breach. At all material times the plaintiff had sufficient funds to its credit in the Defendant Bank as a customer to cover the amount in the letter of Credit.
5a. the said num of $83,500 was from export Proceeds, not from bidding. If a customer goes for bidding at 1993/1994 the customer cannot be allocated with the whole amount he bided for. The Central Bank of Nigeria allocates in bits or in parts therefore there will no need for submission of all the documents submitted to the Defendant. Letter written by five Industries Ltd, a Sister Company of the Plaintiff Company dated 13/5/94 and letter to the said Five Industries Ltd by Lion Bank of Nig. Ltd dated 25/10/94 will be founded upon.”

The appellant’s response to the above averments can be found in paragraphs 3, -11, and 18 of the 2nd further amended statement of defence on pages 23-27 of the record.

By virtue of sections 131-133 of the Evidence Act, 2011, whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts shall prove that those facts exist. When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person. The burden of proof in a suit lies on that person who would fail if no evidence at all were given on either side. Authorities are legion on the principle that he who asserts must prove. The law is also settled that in order to discharge the onus, a part must adduce cogent and credible evidence that has
direct relevance to the matter in controversy, see Mrs. Oluwaseun Agboola vs United Bank for Africa plc & Ors (2011) LPELR 9353(SC). In the instant case, the initial burden was on the respondent to prove by cogent and credible evidence that the foreign exchange he applied for was from Export proceeds and not from bidding at the Central Bank and this he must do by presenting cogent and credible evidence. The evidence PW1 is that the respondent approached the appellant in September, 1993 for allocation of foreign exchange through its manager, Mr. Eke. Mr. Eke informed the respondent that the appellant had $100,000 Dollars for the respondent through export proceeds and the appellant was prepared to open letters of credit if the respondent had the naira equivalent. According to PW1, the appellant paid the naira equivalent and the letter of credit was opened. After opening the letters of credit, Mr. Eke sent a written note to the appellant that the head office had allocated $83,500.00 to the respondent and that form M and the invoice should be amended accordingly. The note and form M were admitted as exhibits A and C. The law is that where there is oral as well as documentary evidence, the documentary evidence should be used as a hanger by which the oral evidence will be assessed.

I have carefully considered the contents of exhibits A and C. With due respect to the learned trial judge, it cannot be concluded from the contents of exhibit A that the appellant allocated or approved the sum of 983,500.00 from the export proceed. For clarity sake, I reproduced the contents of exhibit A
“I’ve spoken with my head office & it appears they don’t have up to $100,000.00. They will only do the $83,500 as I confirmed to them earlier please amend your form ‘M’/invoice”

This in my view does not in any way constitute an approval of definite allocation of foreign exchange from what was referred to as export proceeds. A definite allocation of foreign exchange by the appellant means the appellant would not need to have recourse to the Central Bank of Nigeria. In my view, that is not the case here. PW1 admitted signing exhibit C (Form M). If the Central Bank is not involved in the transaction, why did he have to sign form M. It is clear on the face of form M that it is an application to the Central Bank of Nigeria(CBN) to purchase foreign currency in the sum of 983,500.00 for importation of cast glass from Peinex Comercia Exterior Ltd. Form M signed by the respondent contains instructions to importers of goods into Nigeria. A holistic reading of the instructions clearly show that the form must be completed by the importer and handed over to the importers bank for onward transmission to Central Bank of Nigeria (C.I.S.S.) office for processing. It is also stipulated on that form that no letter of credit may be opened without a processed form M in the hands of the importer’s bank.

It is my view that the signing of form M is a clear confirmation that the foreign exchange will be sourced from the Central Bank of Nigeria. Clause 3 in the form clearly confirms the averment of the appellant that no commercial bank in Nigeria could approve or issue a letter of credit to a foreign supplier of goods to a Nigerian importer guaranteeing to pay for a certain goods on behalf of the importer when the Central Bank of Nigeria had not yet considered and/or approved the importer’s application for foreign exchange with which to pay for the goods. This case is similar to Nwagwu vs F.B.N. Plc (2003) LPELR 4478(CA) In that case, the appellant (plaintiff before the trial court) completed a similar application to purchase foreign currency (form M), which the respondent also signed and stamped just like the parties in this case. The seller of the goods being imported complied with the terms of the letters of credit informed the respondent (F.B.N. PLC) and demanded payment. Contrary to its undertaking in the letters of credit, the respondent failed to pay on the ground that it was waiting for CBN to release foreign exchange and that its file on the matter was missing.

The appellant sued the respondent and claimed for loss of profit, refund of excess deposit and interest thereon. The trial judge upheld the contention of the respondent that registration of form M by the appellant meant that payment of the supplier was subject to prior release of foreign currency by C.B.N. The respondent was held not liable for failure to settle the letters of credit, notwithstanding the clear terms of the instrument. After considering the extensive submissions and arguments of counsel. His Lordship Bage, JCA held as follows:
“I am in agreement with what the trial judge said in his judgment at page 124 of the Records that: “As far as this court is concerned reliance on Exhibits by plaintiff at best supports that plaintiff too had expected the forex to come from the CBN despite his present posturing. This of course is contrary to the main thrust of the plaintiffs case that the defendant was to directly provide and pay the overseas suppliers. It is the view of this court that the agreement of the parties at the inception of the contract was that the foreign exchange was to come from CBN. That was why the plaintiff completed the form ‘M’ (Exhibit Y)”.

Though it is the general principle of law that finding of fact is a matter within the province of the trial court, where the trial court fails to make the correct findings, the appellate court is at liberty to evaluate such evidence particularly documentary evidence which does not depend on the credibility of a witness and make the correct finding(s), See Arison Trading & Engineering Co. Ltd Vs. the Military Gov. of Ogun State & Ors (2009) 15 NWLR Pt.1163 page 26, Osho vs Ape (1998) 8 NWLR Pt.562 page 492. Having considered the entire evidence led, it is clear that the respondent knew that the foreign exchange could not be made available or provided without recourse to the CBN and that is why he signed form M. If it is true that the appellant had approved and allocated the foreign exchange through another means, there would have been no need for the respondent to sign and stamp Form M. The signing of Form M clearly negates the contention of the respondent that the appellant agreed to allocate the foreign exchange through its export proceeds. With due respect to the learned trial judge, he was wrong in placing reliance solely on exhibit A. When the terms of an agreement have been reduced into writing in more than one document, the entire series of documents must be read together to discover the true intention of the parties and the terms of the agreement. Exhibit A which is an unsigned document any way cannot be the only basis for discovering the intention of the parties in this case.
For the above reasons, issue 1 is resolved in favour of the appellant.

Issue 2 is whether the respondent proved that the appellant issued a letter of credit on behalf of the respondent and later cancelled it, it is the same as the respondent’s issue 2. The appellant’s counsel submitted that the learned trial judge’s finding that the respondent having complied with the appellant’s directive, a letter of credit automatically came into being was made without regard to or consideration of DW1’s evidence that the respondent approached the appellant to help it source for foreign exchange from the CBN and thereafter establish a letter of credit which means that a letter of credit can only come into being after the foreign exchange has been made available. He further submitted that the respondent failed to adduce credible evidence on the opening and cancellation of letters of credit by the appellant.

The respondent’s counsel in response submitted that in law, once an applicant for a letter of credit has done all what is required to do, a letter of credit is assumed to be automatically opened, he relied on A.C.B. Ltd vs Obiniarn (1990) 5 NWLR Pt.149 page 230 at 274. He further submitted that the learned trial judge was right when he held that a letter of credit came into being when the respondent did all it was supposed to do. Counsel referred to exhibits G and S (the letter by which the respondent requested for the return of his document and the letter by which the appellant returned the document) and PW1’s evidence, he submitted that the content of exhibit G shows that the appellant unilaterally changed its position by canceling the letter of credit orally and thereby committed a breach of contract.

In paragraph 5 of its Amended Statement of Claim, the respondent averred as follows:
“5. Surprisingly, the defendant’s letter of October 18, 1993 with reference No.DBL/ON/93/CWC/62/02 to our client the defendant cancelled the letter of credit which it earlier granted the plaintiff. This is a breach. At all material times, the plaintiff had sufficient funds to its credit in the Defendant Bank as a customer to cover the amount in the letter of credit”.

The purport of the above averment is that the respondent got to know about cancellation of the letter of credit by exhibit ‘G’ dated 18th October, 1993 whereas he had stated in his letter dated 13th October, 1993 that he understood that the allocation of $83,500.00 to the respondent for the opening of letters of credit had been cancelled, he requested for the return of his documents. Exhibit G was a reply to exhibit S. It is clear from exhibits G and S that exhibit G did not come to PW1 as a surprise. He had earlier written for the return of his documents. Secondly, he stated in exhibit S that he was made to understand the allocation of the foreign exchange to the respondent had been cancelled and not that any letter of credit was issued and cancelled. In his evidence before the court, PW1 said the appellant issued a letter of credit, he did not see the letter of credit. They told him they will open it. PW1’s evidence is patently inconsistent and contradictory. If the letter of credit was issued to him it means he saw it. He did not see it and was merely told that it was issued or would be issued, then the evidence is hearsay and it is not admissible. Secondly, the respondent tried to cover up the fact that he requested for its documents. The case presented by the respondent both on the pleadings and by PW1’s evidence is that the letter of credit was cancelled by exhibit G, whereas the respondent had earlier requested for the return of its documents. Thus terminating the process of sourcing for the foreign exchange and issuance of the letter of credit. Exhibit U is dated 7th October, 1993, it is a document by which the respondent’s form M was forwarded to the Chief Liaison Officer, Swede control/Intertek for inspection purposes and it was received in that office on the same day.
From the entire evidence led, the respondent failed woefully to prove by cogent and credible evidence that the appellant issued and cancelled any Letter of Credit. Issue 2 is resolved in favour of the appellant.

Issues 3 and 4 are whether the respondent on the evidence before the court established its claim and therefore entitled to general damages as awarded. The appellant’s counsel submitted that respondent’s claim for general damages and the award of general damages for breach of contract are incompetent, as same belongs to the realm of torts, the claim ought to have been dismissed, he relied on Davidson Consts. Ltd. vs Bees Electrical Ltd (2001) FWLR Pt.63 page 154 at 165 (B-D), Ndinwa Vs Igbinedion (2000) FWLR Pt. 30 page 2679 at 2686.
He further submitted that award of damages for breach of contract where no actual damages is established is usually nominal, he relied on Barau vs Cubitts (Nig). Ltd (1990) 5 NWLR Pt.152 page 630 at 646 – 647.
Counsel also submitted that PW1 did not give any evidence of any loss suffered by the respondent save that the respondent suffered “General Damages for which N2 million was awarded. He submitted that the award is excessive, he relied on Okongwu vs N.N.P.C (1999) Pt.115 page 296 at 309 (F-G), 316(F). He finally submitted that the weight of evidence leaned heavily in favour of the appellant and the respondent did not establish its claim on a balance of probabilities. He urged the court to allow the appeal.

The respondent’s counsel submitted that the learned trial judge was right in awarding general damaged in breach of contract because breach of contract is actionable perse, he relied on Universal Vulcaiunizing (Nig) Ltd vs. I.U.T.T.C. (1992) 9 NWLR pt.266 page 388 at 412 (8), Kusfa vs United Bank Const Co. Ltd (1994) 4 NWLR Pt.336 page Electronic Works Ltd 1 at 13 (A), 15(D), Maiden vs A.G. Federation (1994) 1 SC 53, CCB(Nig) Ltd Vs Onwuchekwa (1998) 8 NWLR pt.562 Pages 375 at 397. Counsel referred to exhibits M and N, he submitted that the respondent not only suffered loss of profit but failure to supply those glasses to its customers as agreed makes the respondent appear to be unreliable. He further submitted that in a contract involving a bank and its customer, an aggrieved party is entitled to substantial damages where the contract is breached even without prove of loss, he relied on Salami vs Savannah Bank (1990) 2 NWLR Pt.130 page 106 at 127 (D-E). Counsel further submitted that nominal damages does not mean that small damages will be awarded as nominal damages. He referred to Arta Ind. Ltd vs N.B.C.T (1997) 1 NWLR Pt.483 page 574. Counsel also submitted that the purchasing power of naira and or value of the currency are essential factor to be considered in awarding damages, he referred to Onwa vs Nta (1996) 7 NWLR p.458 PAGE 1 SC (1, 19), Iragunuma vs Uchenndu (1996) 2 NWLR pt 429 page 30 at 54 (H), Eseigbe vs Hgholar (1993) 9 NWLR pt. 316 page 128, CCB vs Onwuchekwu (1998) 8 NWLR pt 562 page 375 at 397 (G-H), Umoetula vs U.B.A. Plc (2002) 3 NWLR Pt 755 page 647 at 665 (F). Counsel finally submitted that the learned trial judge properly and critically examined the entire evidence before the court and correctly assessed and appropriately ascribed probative value to them. He urged the court to dismiss the appeal.

The learned trial judge obviously proceeded on the finding that the appellant breached the contract entered into between it and the respondent by canceling the letter of credit thereby putting an end to the contract.

In this case, it is my finding that the respondent did not prove that any letter of credit was issued. Secondly, it was the respondent that terminated the process which would have culminated in the issuance of the letters of credit. Thus the appellant did not breach any contract to warrant an award of damages in favour of the respondent. It is settled that a claim for general damages or distinction between general and special damages are inappropriate in an action for breach of contract, see G.K.I.F (NIG) LTD VS NITEL PLC (2009) 15 NWLR PT.1164 PAGE 344

Even if the respondent’s claim is understood to mean a claim simply for breach of contract, the claim cannot succeed. A party claiming damages for breach of contract must plead and proof the actual loss it suffered. The loss must be real, not speculative. In the instant case, the respondent did not plead or lead evidence of any loss it suffered. It simply pleaded that it suffered damages as a result of the breach of contract. The respondent is not entitled to any award either as general or nominal damages because he has not proved any breach of contract. The learned trial judge erred in awarding general damages in favour of the respondent as he did. An appellate court will not interfere with an award of damages by a trial court except where it is shown that the award is out rightly excessive or that the trial court proceeded on a wrong principle. In the instant case, the respondent did not suffer any loss or at least he did not prove that he suffered any.
Even if the respondent was entitled to damages, the amount of damages must not be excessive or appear to be a windfall. It can only be awarded nominal damages. The award of N2,000,000:00 (Two Million Naira) general damages by the learned trial judge is far above the entire value of the foreign exchange involved in the aborted transaction, it amount to a windfall. The respondent had taken back the money paid into the account opened for the transaction and requested for the documents submitted to enable it claim the money paid for insurance. This suit in my view is an exercise of gold digging which unfortunately the learned trial judge failed to take cognizance of. In my view, the issue of the length of time between the commencement of this action and the date of judgment is irrelevant. The respondent took back its money immediately it terminated the transaction. The award of N2 million as general damages for breach of contract is excessive, it has no support in law and cannot be allowed to stand. The respondent should not have been awarded more than N50,000:00 (Fifty Thousand Naira). I have said that the respondent is not entitled to any award of damages. A plaintiff who fails to establish breach of contract is not entitled to damages. Issues 3 and 4 are resolved in favour of the appellant. This appeal succeeds and it is hereby allowed. The judgment of the Lower Court is hereby set aside. The claim of the respondent for N10 million general damages for breach of contract is hereby dismissed.

There shall be 50,000:00 (Fifty Thousand Naira) costs against the respondent.

AMIRU SANUSI, J.C.A.: I read in advance, the draft copy of the Judgment of my learned brother Yusuff JCA just delivered. My lord has ably dealt with the issues canvassed by the parties learned counsel. The reasoning and conclusion arrived at by my noble lord is in accord with mine and I also hold that there is merit in this appeal. I accordingly allow the appeal and endorse the order on costs made in the lead Judgment.

EMMANUEL AKOMAYE AGIM, J.C.A.: I had a preview of the judgment delivered by my Learned Brother OMODERE MISITURA BOLAJI-YUSUFF, JCA. I agree with the reasoning and conclusions therein.
I also allow this appeal. I agree with the orders made therein.

Appearances

S. I. AbubeiFor Appellant

AND

P. W. O. OkoseFor Respondent