LawCare Nigeria

Nigeria Legal Information & Law Reports

National Industrial Court

Ifeanyi Mbachu -V- First Bank of Nigeria Plc

admin 0

IN THE NATIONAL INDUSTRIAL COURT OF NIGERIA

IN THE LAGOS JUDICIAL DIVISION

HOLDEN AT LAGOS

BEFORE HIS LORDSHIP HON. JUSTICE J. D. PETERS

 

DATE: JANUARY 25, 2018

 

SUIT NO: NICN/LA/374/2013

 

BETWEEN

 

Ifeanyi Mbachu

 

Claimant

 

AND

First Bank of Nigeria Plc.

 

Defendant

 

 

REPRESENTATION

Eekiel Ejefi with Steven Eluwa for the Claimant.

  1. Uye, with Susan Agu & Owolabi Femi for the Defendant.

 

 

JUDGMENT

  1. Introduction & Claims  

This suit was commenced in this Court on 17/7/13 by a General Form of Complaint and a Statement of Facts. The processes were amended on 11/6/14 in which the Claimants sought the following reliefs –

 

  1. A declaration that the dismissal of the Claimant by the Defendant via letter dated 20/2/12 is wrongful and amounts to violation of the claimant’s right not to be wrongfully dismissed.
  2. An order reinstating the Claimant and directing the Defendant to pay the Claimant all his entitlements which have remained unpaid from 20/10/10 to date of reinstatement including any increments that might have accrued within the time and full allowances from October, 2010.
  3. Alternatively an order to pay the Claimant his gratuity with all entitlements and allowances in lieu of reinstatement.
  4. Special damages of =N=31,166,666.65 (Thirty One Million One Hundred and Sixty Six Naira, Sixty Five Kobo) being salary due to the Claimant from February, 2012 to June 2013 and thereafter =N=1,833,333.33 monthly until judgment is delivered.
  5. The sum of =N=150,000,000.00 (One Hundred and Fifty Million Naira Only) as general damages for the trauma the Claimant has been subjected to by the Defendant unlawful action.

 

The Claimants amended process was accompanied by all the requisite frontloaded processes. The Defendant in reaction filed its Defence dated 22/10/13 which was amended via Amended Statement of Defence dated 2/4/14.

  1. Case of the Claimant

Claimant opened his case on 1/7/15 when he testified as CW1, adopted his witness statement on oath dated 10/3/14 as his evidence in chief and tendered 2 documents as exhibits. The documents were admitted in evidence and marked as Exh. C1 – Exh. C22.

 

The case of the Claimant is that he was employed by the Defendant on 14/08/06 and was confirmed on 22/10/07; that he was last promoted to the post of Senior Bank Manager with annual salary of =N=22,000,000 and was designated as Manager Diobu Port-Harcourt Branch of the Defendant Bank; that sometime in 2006, Bussdor and Company, a customer of the Defendant won a bid to take up part of Federal Government of Nigeria equity interest in Dowell Schumberger Nigeria Limited valued at =N=162,000,000; that Bussdor and Company applied to the Defendant Bank via its Diobu Port-Harcourt for a share acquisition facility to enable it purchase the shares; that the Diobu Branch of the Defendant did the credit appraisal memo and passed same on to executive management for due consideration of the customer request; that the Executive Management Credit Committee of the Defendant approved in principle the credit application and through its Analysis Processing Department conveyed the approval to Diobu Branch of Defendant; that this approval in principle the Diobu branch headed by Claimant offered the facility to Bussdor and Company stating all the terms and conditions; that the Defendant’s Customer Bussdor and Company submitted all the documents in fulfillment of the terms and conditions of the share acquisition facility which documents were all confirmed seriating by the Resident Internal Control Officer (RICO) of the Defendant Bank.

 

It is also the case of the Claimant that the Defendant’s Credit Risk Management (CRM) Unit issued the Authority for Utilization memo to the Diobu branch and booked the account at Head office in Lagos for the account follow up/ Management at the branch level by the Diobu branch Relationship Manager one Nnennaya Chima; that Bussdor and Company made a total payment of the sum of =N=85,000,000 as at 25/9/09 for interest and repayment of facility amount; that while the above transaction was ongoing, the Defendant suspended the Claimant and while the Claimant was on suspension NDDC paid the sum =N=69,771,538.70 on 20/5/10; that another sum of =N=5,000,000.00 was paid in December, 2013 and credited to the branch profit and loss account; that as at December 2013 the total sum of =N=160,771,538.70 has been received by Defendant; that the Claimant did a recall from suspension appeal and was invited to another disciplinary committee and the committee after hearing his case recommended termination of Claimant’s employment and that the Defendant on 20/2/12 summarily dismissed the Claimant while a further appeal against his summary dismissal was decline for lacking in merit.

 

Under cross examination, CW1 testified that he was Branch Manager Diobu Branch of Defendant; that Documents 10 – 22 are supposed to be in custody of the Defendant and officers that signed for them to use; that for every credit that passed through him, he made copies for himself and copies for customers’ files; that he kept the ones made for myself in my office in case of need; that there is credit guidelines for the Bank; that he could not remember the date Bussdoor & Co. Ltd applied for facilities from Defendant; that the Bussdoor Credit transaction was the only one above =N=50 million that he did at Diobu Branch; that it is not normal to allow drawdown on facility without security; that the Borrower made a drawdown on the facility on 1/3/07; that Branch Managers do not authorize drawdown; that Branch Operation Manager posted the cheque that availed the customer access to the facility that his role was to confirm that the customer issued the cheque and that the cheque was for the purpose for which the facility was given and that that was what he did in the transaction.

 

Witness added that at the time of drawdown the loan was not set up but the conditions were met; that the Legal Department did not at any time complain about the transaction; that he maintains that Legal department did not complain at any time about the transaction; that there was to be perfection of legal mortgage as part of collateral for the facility but not before draw down; that it is for the Legal Department to answer whether the perfection was done or not; that Forms BS 200 and 201 and other documents required were sent to the Head office on 28/2/07 and the Head office acknowledged same; that he appeared before a Disciplinary Committee in 2010; that he explained his role in the transaction and submitted documents; that the Committee did not agree with him; that there were several sittings at the Panel; that the facility given to the customer on 1/3/07 was a term loan and not an overdraft; that he did not grant any loan of =N=15M or any loan to any customer; that he confirmed that Dr. Alex approved via sms the loan of =N=15M to be disbursed to the customer while the outstanding one was yet to be paid; that this sum was later repaid by the customer; that Exh. C15 is one of the representations he made to the Disciplinary Panel and that he did not benefit anything personal apart from commendation received from the Executive Director of the Defendant.

 

  1. Case of the Defendant

The Defendant opened its case on 8/3/16 when its lone witness adopted his witness statement on oath dated 23/2/16 as his evidence in chief and tendered 9 documents in evidence. The documents were admitted in evidence and marked as Exh. D1 – Exh. D9 respectively.

 

The case of the Defendant is that on 12/207, the Defendant through its Diobu Branch received application for a Loan Facility of =N=162 Million from Bussdor & Co. Ltd. to buy shares in Dowel Schlumberger; that the Claimant was the Officer who headed the Diobu Branch of the Defendant and has all the authority to process and recommend to the Management of the Defendant the approval of the facility; that on 23/2/07, the Defendant gave an approval for limit to the availment of the said Loan to the Applicant Bussdor Co. Ltd on conditions listed in the offer letter; that on the 1/3/07 while the customer was yet to meet the condition precedent to draw down of the loan facility, and while the Loan Account was yet to be set up, the Claimant unilaterally approved an overdraft which allowed the Customer to draw the sum of =N=162 Million on the 1st of March, 2007 contrary to and in total disregard of the credit guidelines and policies of the Defendant; that the Claimant himself under cross examination stated; “at the time of the draw down, the loan was not yet set up” ; that Exh. C13 on the showing of the Claimant stated: “the above facility which was properly approved was yet to be set up because our legal services is yet to give certificate of adequacy”; that the Claimant also subsequently allowed further unauthorized drawings by the Customer in the sum totaling =N=15.325Million without any collateral whatsoever and clearly in excess of the Branch credit limit; that the above misconduct of the Claimant caused a great loss to the Defendant resulting in the huge outstanding debit balances of over =N=230Million in the Customer’s overdraft account which was largely unsecured; that the customer cashed in on the obvious loopholes engendered by the above breach in procedure to the detriment of the Defendant by abandoning the overdrawn account resulting in its classification at a loss to the Defendant; that due to the gross violation of the credit policy and Guideline resulting in the loan running bad, the Claimant was queried, severally afforded the opportunity to defend himself, suspended and ultimately dismissed and that the Claimant’s appeal for the review of his dismissal was looked into by the Defendant but refused for lacking in merit.

 

In cross examination on 14/2/17, DW1 stated that he joined the Human Capital Department of Defendant in 2008; that he is familiar with Organogram of Defendant; that Management of Defendant approved in principle the loan of =N=162,600.00 share acquisition facility subject to certain conditions; that the share in question was acquired; that he is not aware of any letter of Defendant ordering the Port Harcourt Branch to decline utilization of facility already in principle; that there was a letter from Management of Defendant for draw down or utilization of the facility; that Claimant is the Supervisor & Liaison Officer who represents the Defendant in Port Harcourt and therefore Defendant depends on his recommendation or review of matters; that the Claimant supervised Head of Operation of the Branch; that Head of Operations needs written instruction of Branch Manager before he can operate any account; that Head of Operations needs not verify or confirm instruction given by the Branch Manager; that he only needs satisfy to him of approval of Head office; that RICO means Resident Internal Control Officer; that RICO is not responsible to the Manager and may be in charge of more than one branch; that RICO is to provide checks on the operation of the Branch(es); that if the RICO discovers anything negative he is to report to the Head office; that he is not aware of any report from RICO respecting the transaction with Bussdor & Co. Ltd; that CAP means Credit Analysis and Process Department; that this department reviews credit package put forward by Relationship Manager or Business Manager and analyses same and that CAP carried out the risk analysis of the credit granted to Bussdor & Co before the grant.

 

  1. Submissions on Behalf of the Defendant

At the conclusion of trial, learned Counsel on either side were directed by the Court to file their final written addresses for adoption in accordance with the Rules of Court. The final written address of the Defendant was dated 7/4/17 and filed on 12/4/17 and set down the following issues for determination –

 

  1. Whether on the totality of the evidence led in this matter, the dismissal of the           Claimant was wrongful.
  2. Whether the Defendant having justifiably dismissed the Claimant, any claim can           lie in damages against the Defendant.
  3. Whether a Court can under a Master/Servant Contract, reinstate a dismissed           employee.

 

On issue 1, learned Counsel submitted that for a dismissal to be unlawful, there must be proof that there is a departure from the prescribed procedure or that in applying the rule there is a violation of the rule of natural justice so as to render the formal compliance a travesty citing Olaniyan v. University of Lagos (1985)3 NWLR (Pt. 599); that the Claimant has a burden to prove that the procedure adopted for his dismissal did not conform to his terms and conditions of his employment; that in the statement of facts the Claimant did not make any allegation as to what makes the dismissal unlawful; that there is absolutely no fact upon which the claim of unlawful dismissal is predicated and that the action must fail on this singular ground alone citing A.G Rivers State v. A.G, Akwa Ibom State (2011)8 NWLR (Pt. 1248) 31 at 172. Learned Counsel added that the employment of the Claimant was at all times regulated by Exh. C1, Exh. C2 and agreement between the parties; that by Clause 3 of Exh. C2, the Claimant agrees to serve the Bank faithfully and diligently conform to all orders which may from time to time be given to him and to faithfully account for all securities, vouchers, cheques, title deeds and other instruments which shall come into his hand and under his control; that without ensuring compliance with the terms and conditions stated in Exh. D1the Claimant unilaterally  allowed the customer to over draw the said account to the tune of =N=162 Million; that in further flagrant abuse of the credit policy of the Defendant the Claimant allowed additional over draft facility to the customer without any security whatsoever; that there is no evidence before the Court that an application for overdraft was made by the customer or that such application received an approval as contemplated by Exh. D3 – the Credit Policy Manual of the Defendant and that indeed the Claimant under cross examination admitted that at the time the customer was availed the facility as well as the overdraft of over =N=15 Million neither the written confirmation of compliance had been made nor the necessary approval (Form 3800A) issued by the Credit Control of the Defendant as required by Exh. D1. Counsel submitted that the conduct of the Claimant in disobeying lawful and reasonable order and direction amount to misconduct citing Nwobosi v. ACB Limited (1995)6 NWLR (Pt. 404) 677-678, Halsbury Laws of England, vol. 25 p.485 paragraph 933 & Uzoha v. Task Force on Hospital Management (2004)5 NWLR (Pt. 867) 627. Learned Counsel further submitted that the Claimant was queried; that he responded to the query; that he appeared before a Disciplinary Committee several times and made representations and while conceding his mistake asked the Committee for forgiveness. Counsel urged the Court to resolve this issue in favor of the Defendant.

 

On issue 2 which is whether the Defendant having justifiably dismissed the Claimant, any claim can lie in special damages against the Defendant, learned Counsel adopted his submissions in relation to issue 1 and submitted that the dismissal of the Claimant was justified and in line with the terms and conditions of his employment and that that being the case no action can lie in special damages against the Defendant citing PTI v. Nesimone (1995)6 NWLR (Pt. 412) 477 & Kabel Metal Nigeria Limited v. Atirie. Counsel urged the Court to resolve in the negative and hold that the Defendant having justifiably dismissed the Claimant, no claim can lie against it in special damages. On issue 3 whether a Court can under a Master/Servant contract reinstate a dismissed employee Counsel submitted that to grant a reinstatement would tantamount to imposing a willing employee on an unwilling employer which judicial authorities do not support citing NITEL v. Awala (2001)45 WRN 1406 at 160. Finally, learned Counsel urged the Court to dismiss the case of the Claimant with substantial cost.

 

  1. Submissions on Behalf of the Claimant

The Claimant’s final written address dated 1/8/17 was filed on the same day. In it, learned Counsel set down 2 issues for determination as follows –

 

  1. Whether on the totality of the evidence led in this suit, the summary dismissal of      the Claimant was justifiable.
  2. If the answer in issue No. 1 above is in the negative then whether the Claimant is      entitled to judgment in his favour?.

 

On issue 1, learned Counsel submitted that in the circumstances of this case and the totality of evidence led, the dismissal of the Claimant by the Defendant is unjustified, wrongful and amount to a violation of the right of the Claimant not to be wrongfully dismissed; that on the preponderance of the evidence led, the Claimant has established a case of wrongful dismissal; that the evidence of the Defendant lacks credibility and accuracy with laden intention to conceal or misrepresent facts as to the manner the share acquisition credit facility was consummated between the Defendant and its customer. Counsel further submitted that even if there was any misconduct by the Claimant, the Defendant had condoned it; that there were no instances proved before the Court where it was clear that the alleged act of misconduct allegedly committed by the Claimant on 1/3/07 was not fully known to the Defendant until November 2009 when the facility account was classified for recovery and that the Defendant cannot be heard to complain citing Beattle v. Farmenter (1888)5 TLR 396 and that where an alleged act of misconduct has been condoned and where promotion or commendation has been earned by a servant short time after an alleged act of misconduct, then the Master will be estopped from dismissing the servant based on the alleged act of misconduct afterwards citing E.C.N v. Niechol (1969) NMLR 265 at 724. Counsel referred to Exh. C3-Exh. C8 – the various letters of commendation given to the Claimant by the Defendant and argued that the Defendant cannot dismiss the Claimant as done. Learned Counsel urged the Court to hold that the dismissal of the Claimant was not justified but wrongful.

 

On issue 2, Counsel submitted that the law permits both the employer and the employee in an ordinary Master/Servant contract to determine same as they deem fit citing Ajayi v. Texaco Nigeria Limited (1987)3 NWLR (Pt. 62) 577; that whether the claim for wrongful dismissal, termination or retirement was successful or dismissed employee’s claims, benefits and entitlements which have accrued before the dismissal, termination or retirement are always paid to the employee. Counsel cited Onalaja v. African Petroleum Limited (1991)7 NWLR Pt. 206) 691 at 694. Learned Counsel urged the Court to hold, bearing in mind that the Claimant was placed on recovery suspension from October, 2010 receiving only half salary, that the Claimant is entitled to all his claims and benefits which had accrued before the dismissal. The Defendant subsequently filed a 3-page reply address on 25/8/17.

 

  1. Decision

I have carefully read and understood all the processes filed by learned Counsel on either side. I heard the oral testimonies of the witnesses called by the parties and watched their demeanor. I also listened to the oral submissions of Counsel on both sides of the divide. Having done all this, I set down the 2 issues as identified by the Claimant for the just determination of this case as follows –

 

  1. Whether on the totality of the evidence led in this suit, the summary dismissal of the     Claimant was justifiable.
  2. If the answer in issue No. 1 above is in the negative then whether the Claimant is           entitled to judgment in his favour?.

 

My appreciation and understanding of this case is that the Claimant recommended a customer of the Defendant for a grant of a loan facility. The facility was approved in principle subject to the fulfillment of certain specified conditions. Before those conditions and terms are met by the customer of the Defendant, the Claimant allowed the customer to overdraw its account with the Defendant. This was also allegedly done without following the laid down procedure and the policy of the Defendant. Defendant claimed to have incurred huge loss as a result of the conduct of the Claimant. Defendant placed the Claimant on recovery suspension. Defendant subsequently set up a disciplinary panel which the Claimant attended and responded to enquiries. The Claimant was dismissed by the Defendant. Though the letter of dismissal did not specify the reason for the dismissal, however at trial the Defendant claimed that the conduct of the Claimant was nothing short of misconduct for which it has the power to so dismiss the Claimant. The law is trite that when an employee alleges wrongful dismissal or termination of his employment he has the burden of placing before the court his contract of service with the applicable terms and conditions attaching to same. See Asikpo v. Access Bank Plc (2015) LPELR-25845 (CA).The employee is thereafter expected to prove to the Court how his dismissal fails to comply with the terms and conditions of his engagement. See Anifowoshe v. Wema Bank Plc (2015) LPELR-24811(CA). Where an employee fails to do so, the Court will have no option than to dismiss his claim for lack of proof. See Odunze v. Nwosu (2007) All FWLR (Pt. 379) 1295 at 1331-1332. No doubt, this is in conformity with the age old doctrine that he who asserts must prove the assertion. See Okorie v. Unakalama & Anor. (2013) LPELR-22508 (CA). The Claimant has not pointed out to this Court any part of his contract of service violated by the Defendant in dismissing him. At least none of the exhibits tendered by the Claimant has successfully proved that his dismissal was not justified. On the other hand and interestingly too, Clause 9 of Exh. C2 deals with termination by either party. In particular, paragraph (b) of that clause specifically provided that an employee may be summarily dismissed if and when the employee misconducts himself or commits an act which may bring the Bank or himself into disrepute.

 

It is a settled common law principle that an employer has the liberty or right to dismiss an employee summarily for gross misconduct. However, what constitutes a serious or gross misconduct is a question of fact and degree. The misconduct in every given circumstance must be such as to undermine the relationship of trust and confidence supposedly existing between the employer and the employee. See Cadbury Nigeria Plc v. Olubunmi O. Oni (2012) LPELR-19821 (CA). Exh. D4 is the Query issued to the Claimant. It was dated 18/11/09. From the information provided in same, an equity loan was approved for a customer of the Bank, before the Customer fulfilled the conditions of the loan, the Claimant approved an overdraft facility without authorisation to the same customer to the tune of =N=162 Million which was said to have attracted Management fee and penal interest of =N=19,433,730.51 and =N=59,841,668.02 respectively. In his response to the Query on 18/11/09 (Exh. D5), the Claimant concluded by saying, after apologising for this action, that ”I am honestly and sincerely sorry for the policy lapses on the part of the branch and myself and hereby plead for leniency”. There is no doubt that there was a breach of the credit policy of the Defendant by the Claimant.

 

While under cross examination, it was part of the testimony of the Claimant that it is not normal to allow a drawdown on a facility without a security and that at the time of the drawdown, the loan account had not been set up. The Defendant is a financial institution. It keeps depositors’ money as well as provide funding on terms to its customers. From the evidence led in this case, I have reason to believe that the Defendant lost some money due to the unauthorised overdraft facility granted by the Claimant; that the Claimant was queried; that the Claimant responded to the Query; that a Disciplinary Committee was set up in which the Claimant was afforded several opportunities and which opportunities he utilised in defending himself and that the Claimant was eventually summarily dismissed by the Defendant. One can hardly fault any financial institution as in the instant case who dismissed an employee whose conduct results in financial loss to it. I have no reason, on the basis of the facts and evidence led in this case, not to hold and I here hold that the dismissal of the Claimant was justified. I must add that I find rather disturbing the argument to the effect that the Defendant was estopped from complaining about the misconduct of the Claimant simply because it had issued various letters of commendation to the Claimant subsequent to the alleged unauthorised overdraft. The fact remains that the Defendant could not have complained about a breach of it policy by a staff until it is aware of the breach.

 

The second issue for determination as put forward by the Claimant is if the answer in issue No. 1 above is in the negative then whether the Claimant is entitled to judgment in his favour. I have answered the first issue in the affirmative. I have found and held that on the totality of the evidence led the dismissal of the Claimant is justified. Having so found and held, it is safe to also resolve this issue against the Claimant and in favor of the Defendant. I thus hold that the Claimant is not entitled to Judgment in his favor.

 

Finally, for the avoidance of doubt and for all the reasons as stated in this Judgment the case of the Claimant is dismissed for lack of proof.

 

I make no order as to cost.

 

Judgment is entered accordingly.

 

 

 

____________________

Hon. Justice J. D. Peters

Presiding Judge

 

 

admin

Website:

Related Story