MRS. ROSE IFEMESIA v. ECOBANK NIGERIA PLC
(2018)LCN/11887(CA)
In The Court of Appeal of Nigeria
On Tuesday, the 10th day of July, 2018
CA/K/459/2016
RATIO
COMMERCIAL LAW: DISHONORING OF CHEQUE
“Therefore, when for whatever reason the defunct Bank decided to return unpaid the cleared cheques, it was mandatory for the Bank both as a Banking practice and custom and as a requirement of the law to specify and endorse its reason and instantly issue and accompany the dishonoured cheques with a ‘Cheque Return memo’ to the payee bank stating therein the reason or reasons for dishonouring the cheques. Dishonouring a cheque is such a serious matter that the Bank cannot be permitted to off handedly and arbitrarily dishonour a cheque without specifying and communicating to the customer its reason(s) for so doing. It is trite that the very act of dishonouring a customer’s cheque wrongfully, entitles the customer to damages which is generally nominal except in the circumstances such as in the instant case (1) where the person whose cheque was wrongfully dishonoured is a trader or (2) where the person is a person in business whether or not slanderous acts or statement accompany the wrongful dishonour. In such instances, the damages is substantial and at large which entitles the Court or jury within reason, to award what is considered reasonable without proof of any actual loss to the trader. See U.B.N PLC VS CHIMAEZE(Supra); BALOGUN VS NBN LTD (1978) 3 SC 155, where Idigbe JSC held inter alia:
‘…In such cases the jury may within reason make an award of any sum as they consider the circumstances of the breach of contract or dishonour of cheque warrant although there has been no proof of any actual loss (i.e. special damage) to the customer’.”PER AMINA AUDI WAMBAI, J.C.A.
JUSTICES
IBRAHIM SHATA BDLIYA Justice of The Court of Appeal of Nigeria
OBIETONBARA O. DANIEL-KALIO Justice of The Court of Appeal of Nigeria
AMINA AUDI WAMBAI Justice of The Court of Appeal of Nigeria
Between
MRS. ROSE IFEMESIA Appellant(s)
AND
ECOBANK NIG. PLC Respondent(s)
AMINA AUDI WAMBAI, J.C.A.(Delivering the Leading Judgment):
This appeal before us emanated from the Judgment of Hon. Justice Bilkisu Muhammed in Suit No. KDH/KAD/471/2010 delivered on 21st June, 2016 which granted the Respondent?s counter claim and dismissed the Appellant’s claims.
The Appellant in this appeal, trading under the name and style of Rosy Stores Enterprises in Kaduna, was a major distributor of drinks for breweries. She had a Customer/Banker relationship with the defunct Hallmark Bank Plc with account No. 0171021259011 and was between the years 2004 and 2005, a beneficiary of a N50,000000.00 (Fifty Million Naira) overdraft facility granted for the purpose of paying the breweries, which allowed her to receive on credit, tens of thousands of crates of drinks worth tens of millions of Naira. However, as the Bank became comatose, it could no longer honour the Appellant’s cheques drawn on it, including cheques drawn on 10/10/2005 for N13, 478,000, on 22/10/2005 for N17, 540, 835 and on 06/12/2005 for N17, 792, 000 payable to Nigerian Breweries all of which were within the Appellant’s overdraft limit but were all wrongfully dishonoured by the Respondent without endorsing any reason for so doing.
Similarly, dishonoured, was the Appellant’s cheque of 13/10/2005 payable to International Beverages and Breweries Industries Ltd, also within the overdraft limit. The appellant was no longer enjoying the overdraft facility and eventually, the Bank had its Banking licence revoked by the Central Bank of Nigeria (CBN) at the end of the year 2005 for its inability to raise its share capital to the minimum sum of N25 billion required by the C.B.N. Consequently, it went into liquidation by the N.D.I.C. whose interim Implementation Committee demanded Appellant to pay N24,354,841.16 to which demand, Appellant only agreed to pay N12,000,000.00 which was turned down by the Committee.
It was on these facts that the Appellant took out a writ of summons against the Respondent at the lower Court praying for:
a. The sum of N30, 000, 000 being damages suffered by the Plaintiff, a trader, arising from the wrongful dishonour (despite that the Plaintiff had overdraft facilities to cover them in 2005) of the Plaintiffs cheques issued to her to supply’s in the course of trade and drawn on Hallmark Bank Plc, a defunct bank whose assets and liabilities have been acquired wholesale by the Defendant.
b. A declaration that the acquisition by the Defendant of the assets and liabilities of the defunct Hallmark Bank Plc did not and cannot constitute the Plaintiff a customer of the Defendant.
c. A further declaration that the Defendant cannot make demands on the Plaintiff for items of debit in the Plaintiff’s account such as commission on turn over, value added tax, or any other bank charges debited into the Plaintiff’s account between September, and December, 2005 (both months inclusive) nor for liabilities calculated beyond 31/12/2005 when the said Hallmark Bank Plc ceased to operate as a bank.
d. The costs of this action.
In opposition to the claim, the Respondent filed a statement of defence and a counterclaim which were further amended, wherein the Respondent counterclaimed against the Appellant for:
a. The sum of N43, 906, 965.10 (forty three million, Nine Hundred and Six thousand, Nine Hundred and sixty five Naira, Ten Kobo) only, being the outstanding/unpaid balance of credit facility and interest granted to the plaintiff by the defunct Hallmark bank Plc and bought by the defendant from its liquidators Nigerian Deposit Insurance Corporation (NDIC) as at September, 2009.
b. Interest on the said sum of N43, 906, 965.10 (forty three million, Nine Hundred and Six thousand, Nine Hundred and sixty five Naira, Ten Kobo) only at the rate of 19% per annum from September, 2009.
c. Interest at the rate of 10% from the date of judgment until liquidation of the debt.
The learned trial Judge, after reviewing the evidence before the Court, found that the Appellant issued the cheques, Exhibits P1 – P4, far outside the tenor of the overdraft facility when the Appellant’s statement of account, Exhibit D3, was in the debit and accordingly, held that the Appellant failed to establish that the Respondent was wrong in dishonouring the cheques. On the counter-claim, the learned trial Judge found that the Respondent was entitled to recover the outstanding balance of the overdraft in the sum of N36,286,748.02 plus 19% interest per annum from 2005, the Appellant having failed to establish that she had settled the debt. Accordingly, the learned trial judge entered judgment in the said sum and interest in favour of the Respondent and dismissed the Appellant’s claim.
Upset by the decision, the Appellant filed a Notice of appeal first on the 27th June 2016 and another one on 14th September, 2016 which was also amended pursuant to an order of this Court granted on 22/03/2017. The amended Notice of appeal has Fifteen (15) grounds.
In the Appellant’s amended brief of argument filed on 04/12/2017 and settled by John M. Omughele, Esq., of Counsel, eight issues were raised for determination to wit:
1. Was the Court below right in dismissing the Appellant’s action for wrongful dishonour of her cheques on the ground that the cheques were presented outside the tenor of the overdraft facility granted to her.
2. Wasn’t the Court below bound to assess the damages it would have awarded the Appellant had the action for wrongful dishonour of her cheques succeeded, notwithstanding, the dismissal of action.
3. Was the Court below right to have admitted and used exhibit D3 to find in favour of the Respondent in respect of its counterclaim against the Appellant when the exhibit D3 did not satisfy the requirement of Section 84 of the Evidence Act 2011, was faulted as to its authenticity and contents and was not explained by the Respondent in proof of the debt counterclaimed.
3a. Was the Court right in regarding the Appellant as having admitted the sum of money claimed by the Respondent in Exhibit P7 and P8 having regard to the contents of the entirety of the correspondence exchanged.
4. Was there proof before the Court below of the purported purchase and the amount of the Appellant’s actual indebtedness from the Nigerian Deposit Insurance Corporation (NDIC) which should have formed the basis for the counterclaim.
5. Whether the award of interest on N36, 286, 748.02 against the Appellant ‘at the rate of 19% per annum from 2005 until final liquidation of the debt’ was justified.
6. Can the judgment against the Appellant be sustained having regard to Section 36(1) and 294(1) of the Constitution of the Federal Republic of Nigeria 1999 (the Constitution) when it was given 1217 days after final addresses and more than 90 days after a purported re-adoption of addressees.
7. On the available admissible evidence should judgment have gone against the Appellant?
These issues were adopted by the Respondent in its brief of argument filed on 30/06/2017 which was settled by Dzever, S. Stephen Esq.
The Appellant filed a reply brief also settled by John M. Omughele Esq on the 18/07/2017. At the hearing of the appeal on 19/4/2018 both Counsel adopted their respective briefs.
I shall determine this appeal on 3 issues, the Appellant’s issue No.6 as issue No. 1, and collapsing issues (i), (ii) and (vi) into one as issue No. 2; and issues (iii), (iv) and (v) into another as issue No 3, as formulated below:
1. Whether by virtue of Section 294 (1) of the Constitution of the Federal Republic of Nigeria 1999 as amended, the judgment of the lower Court delivered 1217 days after the adoption of final addresses can be sustained.
2. Whether the learned trial Judge was right in dismissing the Appellant’s claims for wrongful dishonour of her cheques and in declining to assess damages that would have been awarded had the claim succeeded.
3. Whether there was proof of Appellant’s actual indebtedness and the learned trial Judge was right in granting the Respondent’s counter-claim plus 19% interest per annum from 2005 till liquidation.
ISSUE NO. 1
On this issue, Omughele Esq of Counsel for the Appellant decried not only the learned trial Judge’s delay in delivering judgment outside the 90 days prescribed in Section 294 (1) of the Constitution, but also the bad wall-paper job of the unwarranted re-adoption of the addresses outside the said period, the period being computed from 19/02/2013 to 21/06/2016. He considered the delay as being unfair to the Appellant and an act inconsistent with the learned trial judge’s Oath of Allegiance to defend the Constitution which is serious enough to fetch her a query as such oaths only give the judiciary and the adjudicatory process a bad image to the greatest pain and concern of the actors who are consciously discharging their duties. The justice in the judgment he argued, is doubtful since the impression of the Judge matters.
In response, Dzever Esq of Counsel for the Respondent submitted that making an issue out of delivery of judgment outside 90 days is not a magic wand that automatically invalidates the judgment as the application of Section 294(1) is whittled down by Sub-Section 5 of the same Section to instances of tangible and clear injury or miscarriage of justice to the Appellant traceable to the non-compliance as decided in OYEGOKE VS IRIGUNA (2001) ALL FWLR (PT. 75) 448 AT 462 ? 3.
The emphasis, he argued, is on the effect rather than on the delay and where there is a delay, the Appellant must show an irregularity or the error suggestive of the fact that the Judge had lost the impression of the case, but the Appellant herein, did not show what miscarriage of justice or injury she suffered by the delay or that the Judge had lost the impression of the case. On the contrary, he contended, it is clear on the record that the learned trial Judge considered the entire case presented by the parties before arriving at his conclusion. There is therefore according to him, no substance in the Appellant?s contention of breach of his constitutional right to fair hearing, urging us to resolve the issue in favour of the Respondent.
Section 294 (1) and (5) of the 1999 Constitution of the Federal Republic of Nigeria (as amended) provide thus:
”Every Court established under this Constitution shall deliver its decision in writing not later than ninety days after the conclusion of evidence and final addresses and furnish all parties to the cause or matter determined with duly authenticated copies of the decision within seven days of the delivery thereof.”
Section 294 (5) of the said Constitution states as follows:
”The decision of a Court shall not be set aside or treated as a nullity solely on the ground of non-compliance with the provisions of Subsection (1) of this section unless the Court exercising jurisdiction by way of appeal or review of that decision is satisfied that the party complaining has suffered a miscarriage of justice by reason thereof.”
The effect of the combined construction of Sub-Sections 1 and 5 of Section 294 of the Constitution is that though Sub-Section 1 makes it mandatory for a Court to deliver its judgment within 90 days after final addresses, by virtue of Sub-Section 5, a judgment or decision delivered outside the prescribed 90 days after conclusion of evidence and final addresses does not ipso facto become a nullity or invalid unless and until the Appellate Court is satisfied that the Appellant has shown that by the late delivery of the judgment, he has suffered a miscarriage of justice.
A party seeking to impugn the judgment has to go the extra mile to show that he has by reason of the delay suffered a miscarriage of justice. In other words, non-compliance with the 90 days stipulated does not simpliciter render a decision a nullity except the party complaining establishes that he has suffered a miscarriage of justice as a result of the delay. Where the party complaining fails to establish a miscarriage of justice, the Appellate Court will be loath to declare the judgment a nullity.
This stated position of the law is supported by a legion of decided authorities including the cases of SAVANAH BANK OF NIG. LTD VS STARITE INDUSTRIES OVERSEAS CORP. (2009) 8 NWLR (PT. 1144) 491; OYEGOKE VS IRIGUNA (SUPRA); P.D.P. VS OKOROCHA (2012) 15 NWLR (PT. 1322) 205 and AKOMA & ANOR VS OBI OSENWOKWU & ANOR (2014) 11 NWLR (PT. 1418) 462 AT 487 – 488 E – H per Galadima JSC.
The undisputed facts in the instant appeal are that parties adopted their final written addresses on 19th February, 2013 and the suit was adjourned to the 19th April, 2013 for judgment which was not so delivered, but upon the Respondent’s/defendant’s application for leave for parties to re-adopt their final addresses, the written addresses were re-adopted on 04/02/2016 and the matter further adjourned to 8th April, 2016 for judgment. Yet the judgment was not so delivered until on the 21st June, 2016; a period of over 41 months (1217 days) after the first adoption and 4 months 17 days after the re-adoption, both of which exceeded the 90 days period allowed by the Constitution.
It is obvious that the judgment of the lower Court did not comply with Section 294 (1) of the Constitution. Not even the wall paper job of re-adoption of the addresses after the 90 days could bring the period within the 90 days.
Undoubtedly, the practice of re-adoption of final written addresses whenever there is a delay in judgment delivery as a means of extending, enlarging or renewing the 90 days stipulated by Section 294 (1) is alien to the Constitution and to Rules of Court. It is unknown to the adjudicatory system of Courts in this country and parties cannot be allowed to circumvent or alter the prescribed period laid down in the Constitution to suit their case. This alien procedure was deprecated in an unreported case of SULE NA?AKA DAMBO V ALH. YALWA WAZIRI & 7 ORS suit No. CA/K/237/2013 delivered on 20/08/2014 per Abiru JCA in the following words:-
”It is important to point out that the procedure of re-adoption of final addresses by counsel when there has been a delay by a Court in delivering judgment in a matter is a very strange one. It has no basis either in the provisions of the Constitution or in the rules of procedure of any Court. Parties and the Court cannot seek to circumvent the provisions of the Constitution by manufacturing and adopting a procedure unknown to law. Thus, the re-adoption of final written addresses cannot suspend or stop the running of time for delivery of judgment from the date the final addresses were duly and properly adopted by counsel to the parties”.
Admittedly, also, the inordinate delay in delivering judgment 1217 days after the initial adoption of final addresses is condemnable and is hereby condemned in strong terms. The question however, remains ”what is the effect of such long delay in the judgment eventually delivered by the learned trial Judge Put differently, did the long delay in the delivery of the judgment occasion a miscarriage of justice against the Appellant in the sense that the learned trial Judge lost the impression of the evidence or of the case”.
Our Courts have taken a stand on approaching the question of non-compliance with Section 294 (1) from the angle of its effect rather than on the delay per se. While not condoning or encouraging non-compliance, emphasis has of recent being on the effect rather than the delay itself. That being the attitude of this Court and the Supreme Court, see for instance AKOMA VS OSENWOKWU (2014) 11 NWLR (PT. 1419) 462 AT 510 – 511 G – A per Odili JSC, it is necessary to have recourse to the entire record, particularly the said judgment to find therein any traces of the loss of impression of the evidence or of the case by the learned trial Judge as a result of the long delay. This I have carefully done, but my sojourn only reveals that the evaluation, appraisal and the analysis of both the documentary and oral evidence by the learned trial Judge only belies any suggestion that the Judge lost the impression of the evidence or that he did not take a proper advantage of having seen and heard the witnesses testify before her.
In other words, the long delay did not affect the trial Court’s perception, appreciation and evaluation of the evidence. Indeed it is not even the Appellant’s case that the Judge lost the impression of the evidence or mis-applied the evidence, or neglected to or wrongly evaluated the evidence on account of the long delay between the adoption of addresses and the delivery of the judgment. Nay; that is not the Appellant’s complaint.
The Appellant’s only grudge without establishing how, is that the long delay was unfair to the Appellant. He however failed to establish what miscarriage of justice was suffered as a result of the long delay in delivering the judgment. On the authorities, an appellate Court would not, merely on the basis of long delay in delivering judgment in contravention of Section 294 (1) of the Constitution, invalidate or nullify the judgment complained against unless and until the Appellant satisfies the Court that he has thereby suffered a miscarriage of justice. The Appellant herein has not shown to this Court what miscarriage of justice she has suffered.
The point has to be emphasized that it is not the intendment of the Constitution that an otherwise well considered judgment would be set aside once delivered outside the 90 days period for non-compliance with Section 294 (1) of the same Constitution.
The true position of the law as expressed by Uwaifo JSC in OWOYEMI VS ADEKOYA (2003) 12 SC (PT. 1) 1 and re-stated inAKOMA & ANOR VS OSENWOKWU & ANOR (SUPRA) is that:-
”a party should not just go on appeal merely on the ground that the judgment he wants set aside was given outside the three months? period. He will have to fight the appeal on all known grounds which can render the judgment unsustainable, not merely on the assessment of facts. Indeed, an Appellant with good grounds of appeal may have no need at all to canvass a ground on on-compliance with the three months’ period except for the purpose of having the Judge (or justices) disciplined by drawing attention of the breach of the Court hearing the appeal in view of Subsection (6) of Section 294 of the 1999 Constitution (formerly Subsection (5) of Section 258 of the 1979 Constitution)”.
See also ATUNGWU VS OCHEKWU (2013) 14 NWLR (PT. 1375) 605.
In the instant case it is clear from the record that the trial Judge did not by reason of the long delay, lose the impression of the evidence or failed to take advantage of having seen and heard the witnesses testified in the matter. The Appellant having failed to establish how and what miscarriage of justice she suffered as a result of the late delivery of the judgment, I resolve this issue against the Appellant and in favour of the Respondent.
ISSUE NO. 2
On this issue, the learned Appellant’s Counsel submitted that the learned trial Judge ought not to have dismissed the Appellant’s claims having accepted the facts that the cheques, Exhibits P1 – P4, were presented by the Appellant, cleared by the defunct Hallmark Bank but not given any value, the law being that the Bank is bound to pay cheques drawn on it by a customer provided the customer has in his hands at the time, sufficient and available funds for the purpose or the cheque is within an agreed overdraft limit, as decided in the cases of OYEWOLE VS STANDARD BANK OF WEST AFRICA (1968) NCLR 65 69 and BANK OF AMERICA (NATIONAL TRUST & SAVINGS ASSOCIATION) VS EDWARD ALEXANDER (1960) ALL NLR 698.
The two reasons given by the learned trial Judge for refusing to grant the Appellant’s claims; namely: (i) that the Appellant failed to tender her statement of account and (ii) that the overdraft facility whose tenure was 180 days was not extant when the cheques, Exhibits P1 – P4, were presented, learned Counsel argued, are flawed in that the Respondent having pleaded and front loaded the statement of account (Exhibit D3), it was not necessary for the Appellant to repeat same.
On the second reason that the tenor of the overdraft had expired or had been spent as at the time the cheques (Exhibits P1 – P4) were presented, it was submitted that the learned trial Judge missed the difference between a loan and an overdraft in that an overdraft unlike a loan, continues until it is called in and determinable only upon written notice. That the Notice having not been pleaded, the overdraft continued and did not cease until the closure of the Hallmark Bank on 31/12/2005, notwithstanding the 180 days in Exhibit D2.
He also faulted the learned trial Judge for isolating Clause 12 (ii) of Exhibit D2 from clause 14 (ii) with which clause 12 (ii) ought to have been read in determining the tenure of the overdraft facility. Clause 14 (ii), which deals with what ought to happen in the event of default, and which shows that a notice is required, is in conformity with the general principle of law that an overdraft is determinable by written notice as against clause 12 (ii) which is subsequent to draw-down. He stressed that the Hallmark Bank did not so notify the Appellant of any breach of the terms in writing nor complain of any prejudice or state any reason for dishonouring the cheques.
Counsel’s more serious complaint is that the learned trial Judge made out a case for the Respondent contrary to the pleadings of the parties as the Appellant pleaded at paragraph 6 of the statement of claim that Exhibits P1 – P4 were drawn and presented during the currency of the overdraft facility which were accepted and cleared because the overdraft facility was available and without any evidence on the part of the Respondents that the cheques were dishonoured because there was no fund under the overdraft.
He submitted that neither the Appellant nor the Respondent pleaded that the overdraft terminated after 180 days on the 29/07/2004, but to the contrary, the Respondent’s position as averred is that the facility was still subsisting as at 2012 when it filed its statement of defence contending further that the Hallmark Bank operated the overdraft facility without making the point made by the trial Judge nor was any evidence led on the issue that the facility expired after 180 days. Both parties as well as the Court he submitted are bound by the pleadings, citing in support, the cases of SPASCO VEHICLE & PLANT HIRE CO. LTD V ALRAINE NIGERIA LTD (1995) 32 LRCN 479 at 491-2; COMMISSIONER FOR WORKS, BENUE STATE V DEVCON DEVELOPMENT CONSULTANTS LTD (1988) 3 NWLR (PT. 83) 407 and OVERSEAS CONSTRUCTION LTD V CREEK ENTERPRISES LTD (1985) 3 NWLR (PT. 13) 407, 414, AT 419.
In addition, it was submitted that notwithstanding the dismissal of the Appellant?s claim, the lower Court, not being the final Court ought to have assessed the damages it would have awarded the Appellant had the claim succeeded, as decided in case of BELLO VS D.S. OF LAGOS (1973) ALL NLR 196. The lower Court having not done so, we were urged to invoke Section 15 of the Court of Appeal Act, CAP 13 LFN 2004 and the Appellant being a trader, to award substantial damages as laid down in GIBSONS VS WESTMINISTER BANK LTD (1939) 3 ALL ER 472.
Counsel urged us to hold that on the available evidence before the Court, the learned trial Judge was wrong in refusing to enter judgment in Appellant’s favour.
Responding, the learned Respondent’s counsel submitted that the issue borders on the evaluation and assessment of Exhibit D2 in proof of the terms and conditions of the overdraft facility, a contract being a legally binding agreement between two or more parties by which rights are acquired by one party in return for acts and forbearance of the other, which terms cannot be modified by the parties or even by the Court as decided in KAYDEE VENTURES LTD VS THE HON. MINISTER OF THE F.C.T., ABUJA (2010) 7 NWLR (PT. 1192) 217 – 218 G – A.
Exhibit D2 having been placed before the Court without any challenge, the lower Court, it was submitted, was bound to evaluate same to arrive at its decision, as decided in OKEDION VS F.A.A.N. (2008) ALL FWLR (PT. 441) 914 AT 921 and that the Appellant cannot challenge the observation by the learned trial Judge that the overdraft was for 180 days revolving, which the Appellant as agreed in Exhibit D2, was to ensure the regularization of, at the end of each tenor before any subsequent rollover. Such observation, learned Counsel argued, cannot amount to making a case for the Respondent or raising an issue suo moto as decided in WEST AFRICAN BREWERIES LTD (2002) ALL FWLR (PT. 112) 53; AKINOLA VS WEMA BANK PLC (2015) ALL FWLR (PT. 795) 292, 365.
On the Appellant’s contention that the lower Court ought to have assessed the damages notwithstanding the dismissal of Appellant’s claim, learned Respondent’s counsel found no basis for such assessment of damages, the Appellant having failed to fulfil the terms and conditions of Exhibit D2 which she voluntarily signed, contending that any such exercise would only be academic or speculative, more so that Exhibits P1 – P4 were issued by the Appellant sequel to her request for N100 Million overdraft facility and not for the N50 Million overdraft facility of 180 days tenor. We were urged to resolve the issue in favour of the Respondent.
The centre piece of the submission of the learned Appellant’s Counsel is that the defunct Hallmark Bank wrongfully dishonoured the Appellant’s cheques, (Exhibits P1 – P4) during the subsistence of an overdraft facility and without proffering any reason for so doing by which act of dishonour, the Appellant suffered some loses which entitles her to the damages claimed.
The overdraft facility which gave rise to the action leading to this appeal was embodied in the letter of offer dated 24th January, 2004 and executed on the 30th January 2004. It has among others, the following contents, terms and conditions.
1. BORROWER Rosy Stores enterprises
2. LENDER Hallmark Bank Plc (The Bank)
3. AMOUNT N50,000,000.00 (Fifty Million Naira).
4. FACILITY Overdraft Facility
5. PURPOSE For stock replenishment
6. TENOR 180 Days (Revolving)
7. SOURCE OF
8. REPAYMENT From Business proceeds and/or other Sources.
9. DRAWDOWN Drawdown will be against your verifiable written request.
12.CONDITIONS
SUBSEQUENT TO DRAWDOWN
i) Your account should operate strictly within limits, keeping covenant with bullet repayment at the expiration of the facility.
ii) You are to ensure that account is regularized at the end of each tenor before a subsequent rollover will be allowed.
13. AVAILABILITY
This offer will lapse after seven (7) days from the date of this offer if not utilized. Availability of funds is subject to the Bank’s funding position and/or legal lending limits as may be imposed by the Central Bank of Nigeria or other monetary authorities from time to time.
14. DEFAULT RATE
CLAUSE
ii) The Bank reserves the right to cease extending further facilities and/or realize the pledged collaterals, if there occurs a breach on your part in any of the terms and conditions of this offer which the Bank considers prejudicial to her interest as a lender/guarantor. This will be communicated to you in writing and we expect you to repay whatever may be necessary to recover our exposure if this facility remains unserviced and/or unpaid for a continuous period of three (3) months after the due date. The following amongst others constitute default, excesses above the authorized limit even if it is for one day; failure to pay the monthly interest charges as and when due; failure to pay the outstanding balance by the expiration date of the facility drawing against unclaimed effects dwindling credit turnover adjudged non commensurate with the level of exposure etc. (Underlining for emphasis).
From the contents of Exhibit D2, it is clear that the Appellant’s application for overdraft facility of N50,000,000.00 (Fifty Million Naira) from the Hallmark Bank Plc (Now a defunct Bank), was approved for the purpose of stock replenishment; the tenor of overdraft was for 180 days (revolving) with 19% per month prime lending interest rate; a commitment fee of 1% per month and a C.O.T. at N2 per month. The drawdown on the overdraft was however against, or subject to Appellant’s verifiable written request, provided the conditions precedent to drawdown as stated in clause 11 (i), (ii) and (iii) were fulfilled. Upon the drawdown of the facility the account must be operated within the agreed overdraft limits with bullet repayments at the expiration of the facility. The Appellant was thus required to ensure that the account was regularized at the end of the tenor before a subsequent roll over would be allowed.
The learned trial Judge construing the effect of clauses 6 and 12 (ii) held inter alia at page 265 of the record that:
”…the overdraft facility granted to her which is for N50,000,000.00 (Fifty Million Naira) was for a tenor of 180 days (revolving) and same whose terms were accepted by the Plaintiff on the 30/01/2004 as can be seen on the last page of Exhibit D2 has it in clause number 12 (ii) of same, that the Plaintiff was to ensure that the account was regularize at the end of each tenor before subsequent rollover would be allowed. Meaning that, the rollover is not automatic”.
On the determination of whether the Exhibits P1- P4 were presented within the tenor of the overdraft, the learned trial Judge held:
”I took a critical look at the dates on Exhibits P1 – P4, the Tenor of the overdraft facility in Exhibit D2 and the state of the Plaintiff’s account Exhibit D3. It is obvious from the dates on those cheques, that is, Exhibits P1 – P4 that they were issued within the months of October to December 2005 and when compared with the tenor period in Exhibit D2, Exhibits P1 – P4 were issued far outside the tenor/period of the overdraft facility of 180 days”.
Omughele Esq has picked hole with the said finding of the lower Court; his reasons being that an overdraft unlike a loan continues until it is called in and is determinable by notice, which notice was not given neither was it the case of parties that the facility terminated after 180 days.
Now, an overdraft is a borrowing facility provided by Financial Institutions including Banks to their current account holders which allows such customers to withdraw money over and above the credit balance in their account provided that the withdrawal is made within a certain agreed amount, called the overdraft limit. An overdraft occurs when money is withdrawn from a Bank account and available balance goes below zero or below the credit balance in the account. By the credit arrangement, a customer is permitted to use or withdraw more than he has in his account without exceeding a specified maximum negative balance.
The customer can write cheques to 3rd parties or withdraw cash from his current account up to the overdraft limit approved or allowed by the Bank. Generally, therefore, when a customer draws a cheque in excess of the amount in his current account standing to his credit therein, it is only but a request for a loan from the Bank and if the cheque is honoured, the customer has borrowed the money from the Bank by way of an overdraft from the Bank. See ISHOLA VS S.G.B. (NIG.) LTD (1997) 2 NWLR (PT. 488) 405.
An overdraft facility unlike a term loan is usually a revolving facility which attracts a higher interest rate and is repayable on demand by the Bank at any time. Deposit into the account can be withdrawn again as long as the total outstanding amount is within the overdraft limit granted. This is why it is called a ‘revolving credit facility’.
There is usually, no minimum monthly repayment for an overdraft facility as long as the amount owed is or remains within the credit limit. However if the account goes into ?excess? the customer must immediately repay the excess amount together with the additional fees that may be charged and if not paid, the Bank reserves the right to stop the facility and require the customer to pay the full outstanding amount within a given time.
By clause 6 of Exhibit D2 which must be read along with clause 9, the tenor of the overdraft facility was 180 days from drawn down of the facility and not from the date of the grant. The importance of drawing the distinction between the grant of an overdraft and drawdown on the facility lies in the law that a mere grant of an overdraft facility does not amount to a debt until it is actually drawn down. Thus, the grantee of an overdraft becomes indebted to the Bank only upon drawing down the facility and not by the mere grant of the facility. The appellant herein does not dispute drawing down the facility but contends that notwithstanding clause 6, the facility did not on the state of the pleadings, the conduct of the Respondent and the law, expire after 180 days.
As rightly submitted by the learned Appellant’s Counsel, issues were not joined on the fact that as at the presentation of Exhibits P1, P2, P3 and P4 on the 10/10/2005, 22/10/2005, 06/12/2005 and 13/10/2005 respectively, the overdraft facility was still subsisting. The Appellant’s averment at paragraphs 6, 6.1 – 6.3 and 8 to that effect was not specifically denied by the Respondent. The attempted traverse contained at paragraph 11 of the Further Amended Statement of Defence is that the Respondent ‘is not in a position to admit or deny the averments in paragraphs 6, 7 and 8 of the statement of claim’. Such a traverse, the authorities have it settled, is that it is an insufficient general traverse and does not constitute a proper traverse.
The case ofOKEKE & ORS VS ORUH (1999) 6 NWLR (PT. 606) 175 says it all when Iguh JSC summed up the law as follows: –
”It is settled that in order to raise an issue of fact, there must be a proper traverse and a defendant does not do this satisfactorily by pleading that he is not in a position to admit or deny a particular allegation in the plaintiff’s statement of claim and/or that he will at the trial put the plaintiff to the strictest proof thereof. See LEWIS & PEAT (N.R.I.) LTD VS AKHIMIEN (1976) 7 SC 157; NWADIKE VS IBEKWE (1987) 4 NWLR (PT. 67) 718, 741; LAWAL OWOSHO VS DADA (1984) 7 SC 149, 163”.
Such a traverse that the defendant is not in a position to deny or admit or puts the plaintiff to the strictest proof, unless by implication from other paragraphs of the statement of defence, the averment the averment can be taken as having being denial, is liable to be construed as placing no burden of proof on the plaintiff to prove the fact averred. See ATOLAGBE VS SHORUN (1985) 4 SC (PT. 1) 43; VEEPEE INDUSTRIES LTD. VS COCOA INDS. LTD. (2008) 13 NWLR (PT. 1105) 486; OMORHIRHI VS ENATEVWERE (1988) 1 NWLR 746, 761.
In the instant case, that the Appellant’s averment in paragraph 6, was not denied, is further reinforced by the Respondent’s averment at paragraph 17 of the said Further Amended Statement of Defence that the facility was still subsisting as at the time of filing the said Respondent’s pleading in March 2012.
Therefore issues having not been joined on the facts pleaded in paragraph 6 of the statement of claim that the cheques (Exhibits P1 – P4) were presented during the currency of the overdraft facility, I consider the Appellant’s argument sound in law, for it is a trite position of the law that issues for trial are joined in the parties pleadings and that both parties and indeed the Court are bound by the pleadings of the parties. See KUBOR & ANOR VS DICKSON & ORS (2013) 4 NWLR (PT. 1345) 534; LEWIS & PEAT (N.R.I.) LTD. VS AKHIMIEN (1976) 7 SC 757.
Furthermore, as rightly submitted by the learned Appellant’s Counsel, the clearance of Exhibits P1 – P4 by the Bank supports the fact that the overdraft facility had not ceased but was still available and running. This is so because a cheque is cleared only after it has passed through the stage or process of clearing, which is the process of moving the cheque from the Bank in which it was deposited to the Bank in which it is drawn and the movement of money in opposite direction. This process begins with the deposit of the cheque in a Bank; it is then delivered to the Bank or the branch as the case may be where it is drawn, from where it is then passed for payment if the funds are available or it is within an approved overdraft limit, and the Bank is satisfied of its genuineness. If satisfied, the cheque is cleared and only then is the money actually taken out of the account.
Methinks, before a cheque is cleared, the clearing Bank or Branch must or ought to ensure that there is available money in the drawing account. Generally, therefore, the clearing of a cheque implies that the cheque is genuine and there is money available in the drawing account. Except for technical, fraud or security reasons or a stop is put to the cheque, which must be so specifically endorsed and communicated, such a cleared cheque should not be returned unpaid after being duly cleared. Therefore, all said and done, I find in the Appellant’s submission a powerful argument and indeed a shot that hits the bull’s eye and meets the concurrence of this Court, that the clearance of Exhibits P1 – P4 for payment ordinarily signifies the subsistence of the overdraft facility and the availability of sufficient funds in the account.
For this reason, I lend my support to the Appellant’s submission that as at presentation of Exhibits P1 – P4, the overdraft facility was still subsisting and Exhibits P1 – P4 are within the limit of the overdraft. In effect, notwithstanding clause 6 of Exhibit D2, Per force of the pleadings and the subsequent action of the defunct Bank in clearing Exhibits P1 – P4 and honouring some other cheques outside the 180 days, the overdraft facility did not, contrary to the view held by the learned trial Judge, cease at the expiry of the 180 days.
The law is that an overdraft is determinable upon demand in writing and there is no cause of action until there has been a demand and failure to repay same. It is indeed an implied term in a Banker/Customer relationship that there should be no right of action for the repayment of an overdraft until there has been a demand or notice given. See ISHOLA VS S.G.B. (NIG.) LTD (Supra); N.D.I.C. VS ORANU (2011) 18 NWLR (PT. 744) 183. A demand or notice was thus required to be given to the Appellant to determine the overdraft. In other words, the cause of action did not accrue unless and until there was a demand or notice given to the Appellant by the Bank, which undeniably was not given before Exhibits P1 – P4 were dishonoured or even before the defunct Bank was closed down in December 2005.
The first demand letter written by NDIC was on 11/09/2006 and by the Respondent on 22/05/2008 after Exhibits P1 – P4 were dishonoured and after the closure of the Hallmark Bank. This was a clear contravention of the law which requires Notice to be first given before the accrual of the cause of action as well as clause 14 (ii) of Exhibit D2 wherein the Bank covenants to communicate in writing to the Appellant in the event of a breach of any of the terms and conditions of the agreement before it exercises its right to either cease extending further facilities and/or realize the pledged collaterals.
I cannot therefore agree more with the learned Appellant’s Counsel that clause 12 (ii) cannot be read in isolation of clause 14 (ii), but must be read together.
As properly acknowledged by the learned Respondent’s Counsel at the lower Court, a Banker is without doubt, duty bound to pay cheques drawn on him by a customer provided he has in his hands at the time sufficient and available funds for the purpose or the cheques are within the agreed overdraft limit. See FIRST AFRICAN TRUST BANK LTD VS PARTNERSHIP INV. CO. LTD. (2003) 18 NWLR (PT. 851) 35; U.B.N. LTD VS NWOYE (1996) 3 NWLR (PT. 435) 135; U.B.N. PLC VS CHIMAEZE(2014) 9 NWLR (PT. 1411) 166. It follows that the refusal of a Banker to pay a customer’s cheque when the customer has sufficient funds in his account or the cheque is within the limit of an approved overdraft, constitutes an actionable breach of contract which action lies in damages against the Bank. SeeU.B.N. PLC VS NWOYE (Supra); WEMA BANK PLC VS OSILARU (2008) 10 NWLR (PT. 1094) 150 AT 171; S.T.B. LTD VS ANUMNU (2008) 14 NWLR(PT. 1106) 125, AT 151; ALLIED BANK LTD VS AKUBUEZE (1997) 6 NWLR (PT. 509).
The Appellant in the instant case, from what has been stated earlier, was still enjoying the Overdraft facility as at the presentation of Exhibits P1 – P4 which imposes on the Bank an obligation to honour the cheques which were within the limit of the overdraft facility. Therefore, when for whatever reason the defunct Bank decided to return unpaid the cleared cheques, it was mandatory for the Bank both as a Banking practice and custom and as a requirement of the law to specify and endorse its reason and instantly issue and accompany the dishonoured cheques with a ‘Cheque Return memo’ to the payee bank stating therein the reason or reasons for dishonouring the cheques. Dishonouring a cheque is such a serious matter that the Bank cannot be permitted to off handedly and arbitrarily dishonour a cheque without specifying and communicating to the customer its reason(s) for so doing.
It is trite that the very act of dishonouring a customer’s cheque wrongfully, entitles the customer to damages which is generally nominal except in the circumstances such as in the instant case (1) where the person whose cheque was wrongfully dishonoured is a trader or (2) where the person is a person in business whether or not slanderous acts or statement accompany the wrongful dishonour. In such instances, the damages is substantial and at large which entitles the Court or jury within reason, to award what is considered reasonable without proof of any actual loss to the trader. See U.B.N PLC VS CHIMAEZE(Supra); BALOGUN VS NBN LTD (1978) 3 SC 155, where Idigbe JSC held inter alia:
‘…In such cases the jury may within reason make an award of any sum as they consider the circumstances of the breach of contract or dishonour of cheque warrant although there has been no proof of any actual loss (i.e. special damage) to the customer’.
The Appellant herein undisputably being a trader, is entitled to substantial damages for the wrongful dishonouring of her cheques, which as pleaded, injuriously affected her business. For the forgoing reasons, the learned trial Judge was wrong to have held otherwise. I however, disagree with the Appellant?s Counsel that the lower Court ought, after dismissing the Appellant?s claim to have assessed the damages that could have been awarded if the case had succeeded. On the whole, I resolve this issue in favour of the Appellant.
ISSUE NO. 3
On this issue, it was submitted that the purchase of the debt itself which is the subject of the counter-claim was not proved by the Respondent as required, issues having been joined on what was actually purchased. The NDIC letter of 27/07/2007 tendered and admitted as Exhibit D1 for the purpose of proving the debt not being a Certified True Copy (C.T.C.), learned Counsel argued, is inadmissible to prove the debt.
It was further argued that Exhibit D3 which the learned trial judge relied on to award the counter-claim against the Appellant ought not to have been relied upon same having not fulfilled the requirements of Section 84 (2) and (4) of the Evidence Act in that no evidence was adduced linking the series of computers from which it was generated from the 1st Bank to the subsequent Bank and no proper certification of the computer printout was done to show the manner of its production. The non-compliance he argued, renders the document inadmissible citing in support the case of ALASHE VS OLORI ILU (1964) ALL NLR 384, 390.
Pressing further, he submitted that assuming the document is admissible, it deserves no weight as it does not disclose its origin, nor does the officer, DW1 who tendered it and who was a complete stranger, knows its contents or how the figure was arrived at. That, as if the Court was an investigator, the document was merely dumped on the Court without explaining the entries, how the figure was arrived at, or an explanation why Exhibits P1 – P4 were not therein reflected, contrary to the decision in the cases of MUHAMMADU DURIMINIYA VS POLICE (1962) NNLR 70, 73 – 74; JOHN OREKIE ANYAKWO V AFRICAN CONTINENTAL BANK (1976) ALL NLR 118; BILANTE INTERNATIONAL LTD V NIGERIA DEPOSIT CORPORATION (2011) 6 SCNJ 48.
It was also submitted that contrary to the view of the learned trial Judge, it was the duty of the Respondent and not that of the Appellant to tender the statement of account to prove its counter-claim which could not be proved by merely dumping the statement of account on the Court by DW1 who did not know the account nor dispute the Appellant’s discovery of the incorrect entries therein.
While urging us to expunge Exhibit D3, learned Counsel also faulted the learned trial Judge for relying only on Exhibits P7 and P8 among other correspondences, and treating them as constituting admission of the amount claimed by the Respondent or as estoppel rather than reading the letters as a whole to discern that there was no conclusive admission of any particular amount especially having regards to the letter of 22/05/2008 in reply to Exhibit P7. He cited in support the cases of SEISMOGRAPH SERVICES (NIG.) LTD VS EYUAFE (1976 9 – 10 SC 135, 137, 144 – 152; CECILIA IHUOMA NWANKWO VS EMMANUEL CHUKWUNABI NWANKWO (1995) 5 SCNJ 44.
On the award of 19% interest on the sum of N36,286,748.02 against the Appellant ‘from 2005 until final liquidation’ as against the effective date of ‘September 2009′ claimed by the Respondent, appellant’s learned Counsel submitted that the lower Court has no power to award what was not asked for, in support of which submission, he cited the case of OBA LAWAL VS CHIEF SOLOMON ADENIYI (2000) 5 SCNJ 1 AT 8. This is more so that no contrary evidence was pleaded before the Court that the Hallmark Bank was abruptly closed down in 2005.
Responding, and submitting per contra, Dzever Esq of Counsel posited that the Appellant having herself pleaded the fact of the purchase of the Hallmark Bank by the Respondent, she cannot approbate and reprobate or speak from both sides of her mouth but must be consistent in her case as held in INTERCONTINENTAL BANK VS BRIFINA LTD (2012) 13 NWLR (PT. 1316) 1 AT 9; SUBERU VS THE STATE (2010) 1 NWLR (PT. 1176) 494; THE REGISTERED TRUSTEES OF NATION OF COMMUNITY HEALTH PRACTITIONERS OF NIG. & ORS VS MEDICAL HEALTH WORKERS UNION OF NIG. & ORS (2008) 1 SCNJ 38.
The Appellant, he argued, cannot now deny that fact nor raise the issue for the first time on appeal without leave of Court.
On Exhibit D3, it was submitted that the Appellant’s argument thereon is diversionary as the decision of the learned trial Judge was not based on Exhibit D3 but on the Appellant’s admissions contained in Exhibits P7 and P8, which by law requires no further proof, citing in support the cases of ABAH VS OWEI (2015) ALL FWLR (PT. 780) 1343, 1366 – 1367; G.F. INVESTMENT (NIG.) LTD VS NITEL PLC (2009) 15 NWLR (PT. 164) 344. And MOGAJI VS ODOFIN (1978) 4 SC 91. The learned trial Judge having evaluated the entire evidence as shown at page 270 of the record which evaluation the learned Appellant’s Counsel has no quarrel with, this Court is urged not to interfere; again, calling in aid the case of ABAH VS OWEI (Supra).
Counsel however made no response on the issue of interest, which the Appellant’s Counsel in his reply brief argued is an admission of what was submitted for the Appellant.
?The centerpiece of the learned Appellant’s Counsel’s submission is that the Respondent did not, by the evidence adduced before the Court, prove the counter-claim nor was the learned trial Judge right in granting the counter-claim and awarding interest beyond what was claimed.
A counter-claim is a separate, distinct and independent claim from the plaintiff’s main claim, and like the plaintiff’s claim, must be properly proved on the same principles and standard of proof. It stands or falls on its own merit independent of the plaintiff’s main claim. In other words, as the plaintiff is required to prove his case to succeed, so is the counter-claimant required to establish his entitlement to his claim and cannot rely on the failure of the plaintiff’s claim or ride on the back of the weakness of the plaintiff’s case. Both the Plaintiff’s case and the defendant’s counter-claim receive the same treatment in terms of proof and the Court has a duty to approach both on the same principles of pleadings and the standard of proof. Available legal authorities vindicating the stated position of the law are legion. These include the case of JERIC NIG. LTD VS UNION BANK OF NIG. PLC (2000) 15 NWLR (PT. 691) 447 where Kalgo JSC had this to say:
”It is trite law that for all intents and purposes, a counter-claim is a separate independent and distinct action and the counter-claimant like all other plaintiffs’ in an action, must prove his claim against the person counter-claimed against before obtaining Judgment on the counter-claim …”
See alsoBALOGUN VS YUSUF (2010) 9 NWLR (PT. 1200) 515; OGLIOKO MEMORIAL FARMS LTD & ANCOR VS NACB LTD & ANR (2008) LPELR 2306 SC; USMAN VS GARKE (2003) 14 NWLR (PT. 840) 261.
However, before considering the proof or otherwise of the counter-claim, I should first, albeit, without any much ado or circumambulation, state that the Appellant is by paragraphs 10 and 11 of her pleadings and Counsel’s argument at the lower Court, estopped from denying the fact of the Respondent’s purchase of the assets and liabilities of the defunct Hallmark Bank and its right to demand for payment of debts owed to it. Having in the statement of claim pleaded the facts of the purchase of the assets and liabilities of the defunct Hallmark Bank by the Respondent, it no longer lies in the Appellant’s mouth to deny that fact. The Appellant cannot like a chameleon change the colour of his case to one other than it was at the lower Court. She cannot be allowed to approbate and reprobate or speak with both sides of her mouth at will, but must be consistent in her case. The elementary law of pleadings is that parties as well as the Court are bound by pleadings. Once parties have formulated their case and have adumbrated and particularized their facts in their pleadings, they are bound by the case as put forward in their pleadings.
The pleadings become the guiding light to their case and the path through which the Court navigates their dispute and the justice of the case. Therefore, no party can be permitted to set up a case at variance with his pleadings or argue outside the pleadings on any matter upon which no issue is joined.
It is thus not open for the Appellant to place on the Respondent, the burden of proving the fact of the Respondent’s purchase of the assets and Liabilities of the defunct Hallmark Bank
In proof of the counter-claim the Respondent tendered Exhibit D3 through DW1, Ahmed Shettima, the Respondent’s Customer Services Officer. Exhibit D3 is the Appellant’s statement of account which the Respondent tendered along with other documents including Exhibits P7 and P8 for the purpose of proving the Appellants indebtedness to it.
The learned Appellant’s Counsel has vehemently attacked reliance placed on Exhibit D3 by the lower Court in arriving at the amount of the Appellant’s indebtedness to the Respondent. His attack is premised essentially on the evidence of DW1 in cross-examination which for its eminence in the determination of the appropriate weight to be accorded to Exhibit D3, is necessary to be reproduced. It is hereby reproduced infra:
”I have seen Exhibit D3. It does not bear Ecobank logo or Hallmark Bank logo or names. Between 2004 – 2006 I was with Bank of the North. The period covered by Exhibit D3, I was neither with Hallmark Bank or Ecobank. The defendant is counter claiming the sum of N43,906 million from the plaintiff. To arrive at that sum whether the defendant took into account the period December 2005 and July 2007 I do not know. I have seen Exhibit P1 – P4. The cheques issued in favour of Nig. Breweries have not all been reflected in D3 but Exhibits P2 only was reflected therein”.
The above evidence speaks for itself and is self-explanatory.
The statement of account does not disclose its origin. Did it emanate from the Hallmark Bank, NDIC, Ecobank or from no where? DW1 who tendered Exhibit D3 was neither a staff of the defunct Hallmark Bank nor of the Respondent’s Bank at the material time to which the statement relates. Apart from being a staff of the Respondent, the witness had no connection with the account. He did not as he could not explain the entries in the account. Indeed, he could not have explained the entries in the account since he did not know whether in the computation of the figure, the period between December 2005 and July 2007 were reckoned with. Literally, Exhibit D3 was only dumped on the Court.
It has now become settled that a party relying on a statement of account to support his claim for unpaid debt, or loan must not only tender the statement of account in evidence, but must also adduce oral evidence linking the statement with the actual payments made, showing what was owed, what was paid, what is outstanding and how the outstanding sum was arrived at. Mere presentation or dumping of the customer’s statement of account is not sufficient, because the statement of account cannot, on its own, amount to sufficient proof to impose liability on the customer for the overall debit balance shown on a statement of account.
In dealing with a similar situation, the Supreme Court in the case of BILANTE INTERNATIONAL LTD VS NDIC (2011) 6 SCNJ 481, where the statements of accounts were merely tendered and admitted in evidence in proof of the amount owed without an explanation of how the amount was arrived at, held that it was necessary to adduce oral evidence to put the statement of account in proper perspective to establish the claim. Similarly, in OREKWE ANYAKO VS ACB LTD (1976) ALL NLR 118 Fatayi Williams JSC (as he then was) held that the plaintiffs whose claim was based on the statement of account knew or ought to have known right from the beginning that to succeed, they had to prove how the debit balance which they claimed from the defendant was arrived at, but they, as in this case, called only one witness who like DW1 in the case at hand, did not appear to know anything about the entries therein and how the amount reflected as the debit balance was arrived at. That is not good enough.
DW1 offered no explanation on the entries in Exhibit D3. Exhibit D3 on its own and in this case even with the evidence of DW1 do not constitute sufficient proof of the debit balance against the Appellant. Simply put, a bank statement of account is not and cannot offer sufficient explanation of the debit and lodgments in a customer’s account to charge the customer with liability for the several debit balance shown in the statement of account. The Bank must adduce both documentary and cogent oral evidence to show how the overall debit balance was arrived at. This requirement is even more stringent where as here, there is a dispute on the actual indebtedness due, and the correctness of the entries in the statement of account. The bank has an obligation to demonstrate through oral evidence by its official who is acquainted with the account, the analysis of how much of it is the interest and how the balance was arrived at. Authorities on this stated principle of law include,BIEZAN EXCLUSIVE GUEST HOUSE LTD V. UNION HOMES SAVING & LOANS LTD (2011) 7 NWLR (Pt. 1246) 246; YUSUF V. AFRICAN CONTINENTAL BANK (1986) 1-2 SC; HABIB NIG.BANK LTD V. GIFT INIQUE (NIG) LTD (2004) 15 NWLR (Pt. 896) 405; WEMA BANK V. OSILARU (2008) 10 NWLR (PT. 1094) 150
The Appellant herein did not only deny the debit balance but also challenged the correctness of the entries in the account which DW1 could not confirm nor explain as he admitted that Exhibits P1 – P4, which were cleared cheques, were not reflected in the account, nor did he offer any explanation on the absence of the interest rate on the face of Exhibit D3 which the Appellant had challenged. A study of Exhibit D3 also reveals that there are entries of ‘correction of debit balance’ the reason for which was not explained to the Court. In a situation like this where the entries in a statement of account are not explained to the Court, the only option for the Court is to abide by its duty of adjudication between the parties based on the facts of the case and what has been demonstrated in evidence before it and apply the applicable law to the tested evidence. It is not and cannot be the duty of the Court to conduct an investigation to fish out the evidence or to embark on a voyage of discovery.
This principle of law was clearly reiterated by the Apex Court in the cases of FBN PLC VS MAMMAN NIG. LTD (2001) ALL FWLR (PT. 31) 289 AT 290 PARA D – F and in REV-KING VS THE STATE (2016) LPELR 40046 (SC) where the Court held that a Court is an umpire and does not take sides in the dispute. If at the end of the case the prosecution failed to prove an Exhibit (and this also applies to a civil case), the Court will reject the Exhibit. In view of the forgoing I align myself to the submission of the learned Appellant’s Counsel which is in tandem with the law, that the tendering of Exhibit D3 by DW1 who could not explain the entries in the account, how the debit balance was arrived at, or why some transactions were not reflected therein was not sufficient to prove the debt balance against the Appellant.
The pertinent question is whether there was any other evidence to sustain the judgment of the lower Court. In other words, whether the Respondent otherwise proved its counter-claim. Aside from Exhibit D3, the Respondent tendered several correspondences between it and the Appellant being demand letters and Appellant’s replies thereto. Among them, are Exhibits P7 and P8 which the learned trial Judge relied upon to hold that the Appellant did not protest or contest the figure of her indebtedness to the Respondent therein stated to be N36,286,748.02 as at the 31st December, 2005 and having not shown that the debt had been repaid, the Respondent had proved the said sum of N36,286,748.02.
The learned Appellant’s Counsel has accused the learned trial Judge of relying only on Exhibits P7 and P8 out of the several others out of con and that the Appellant’s replies to the said Exhibits P7 and P8 cannot be construed at admission or operate as estoppel against the Appellant.
It is true that apart from Exhibits P7 and P8, other demand letters were written mostly from the Chambers of Iyoha Iyoke & Co. on behalf of the Respondent quoting the amount of Appellant’s indebtedness to the Respondent as N43,906,965.10. Such letters include the Counsel’s letters written on 20/08/2009, 09/09/2009 and 15/12/2008 at pages 29, 32, and 35 of the record respectively.
The appellant in expressing her strong objection and challenge to the quoted figure in her letters dated 24/08/2009, 23/09/2009 and 29/12/2008 at pages 30, 33 and 36 of the record which are in response to the Respondent’s letters of 20/08/2009, 09/09/2009 and 15/12/2008, clearly and unequivocally disputed the said figure of N43,906,965.10 as the correct outstanding debt owed.
However, the Appellant’s clear and ambiguous denial of the N43,906,965.10 figure, as the debt due, cannot be said of her undated letter in response to the Ecobank’s letter of 22/05/2008 (Exhibit P7) wherein the figure, N36,286,748.02 was quoted as the outstanding balance. The Appellant did not dispute the quoted figure of N36,286,748.02 as the outstanding balance against her. The law is settled and clear that where a Bank makes demands for settlement of debt by letters and the amount of debt is contained in the letter(s) and the debtor does not query the figure written in the letter(s) as the overall debt due but rather writes letters in response explaining the reasons for non-payment of the debt, the debtor will be deemed to have impliedly admitted the quoted figure as the amount of debt due. See the decision of this Court in NAGEBU COMPANY (NIG) LTD VS UNITY BANK PLC (2014) 7 NWLR (PT. 1405) 42, 81 and KARIMAT GLOBAL TRADE LINKS LTD & ANOR VS UNITY BANK PLC (2014) LPELR 23986 (CA).
In the instant case, the learned trial Judge considering the Appellant’s non denial of the figure quoted by the Respondent in Exhibits P7 and P8 held inter alia.
The balance standing as debt against the Plaintiff is N36,286,748.02 that is, as at 2006 and not the sum counter claimed by the Defendant. Same with Exhibits P7 and P8 tendered by the plaintiff, in the said letters the Defendant demanded that the Plaintiff should pay the sum of N36,286.748.02 being the debt standing against her as at 31st December 2005. And, unlike in Exhibit P10, the plaintiff didn’t protest/contest the figure of amount demanded in the said Exhibits P7 and P8, rather in response to the demand for payment, she expressed her concern for not settling her debt which sum was reflected in the letters and suggested that the matter be amicably settled. See Exhibits P7 and P8?.
I entirely agree with the reasoning of the learned trial Judge. In situations such as this, where the appellant neglects, refuses or fails to deny the amount stated in the demand letter as the outstanding amount due and unpaid, the Appellant will be deemed by the non-denial to have admitted the quoted figure as the amount due against him. InIGA VS CHIEF AMAKIRI (1976) 11 SC the Supreme Court held that failure to react to a demand letter leads to a presumption of admission by conduct which decision was followed by this Court in IN-TIME CONNECTION LTD VS ICHIE (2009) LPELR 8772 AT PAGE 20 PARA D – G per Eko JCA (as he then was). In the circumstance, the learned trial Judge was therefore perfectly justified in treating the Appellant’s non denial of the figure N36,286,748.02 quoted in Exhibits P7 and P8 as an admission of her indebtedness to the Respondent in the said amount.
The trial Judge also found, and correctly too, that the Appellant having not proved repayment of the debt, the Respondent had proved the counter-claim in the said sum and accordingly ordered the Appellant to pay the said sum to the Respondent. Again, I agree with this conclusion and have no reasons to part ways with the trial Judge.
On the issue of interest on the said sum, the Respondent at paragraph 26 (b) asked for ?Interest on the said sum of N43,906,965.10 (Forty three Million, Nine Hundred and Six Thousand, Nine Hundred and Sixty Five Naira, Ten Kobo) only at the rate of 19% per annum from September 2009?.
While the Respondent prayed for 19% per annum interest from September 2009, the lower Court awarded 19% per annum interest from 2005 retrospectively. I cannot agree more with the Appellant’s Counsel that the interest awarded by the lower Court is not consistent with the claim and that a Court cannot award more than or what is not claimed.
This is elementary and requires no erudition on the part of the Court to discern. It is a general principle of law that a Court will not grant a party what was not claimed nor will a Court grant a party more than what is claimed as the Court is not a charitable organization. See JERIC (NIG) LTD VS UBN PLC (Supra); EKPENYONG VS NYONG (1975) 2 SC 71.
On the effect of granting a party what was not claimed, the Supreme Court in NWOKORO & ORS VS ONUMA & ANOR (1999) 12 NWLR (PT. 631) 343, also reported as (1999) LPELR ? 2126 (SC), per Belgore JSC (as he then was) at page 30 paras B – C stated inter alia:-
”…By granting what has not been prayed for, a Court suo motu gratuitously awarding a remedy unpleaded will be in error”.
The lower Court therefore erred in awarding the rate of higher interest higher than was claimed.
Furthermore, if the 19% interest per annum awarded by the lower Court effective from 2005 until liquidation was meant to be a post-judgment interest, same is also wrong in law.
This is because the award of post-judgment interest is a matter statutorily regulated by the Rules of each Court; each Court providing the maximum rate or percentage of interest which a party may be ordered to pay after judgment, as post-judgment interest.
There is no discretion in the Judge to award a rate or percentage higher than is provided by the Rules of Court. The only discretion exercisable is to award the maximum percentage or anything less but not anything more than the maximum. The learned trial Judge was therefore wrong to have awarded the interest at the rate of 19% per annum until final liquidation far above the 10% per annum prescribed by the Rules of Court. To this extent I am at one with the submission of the learned Appellant’s Counsel that the said interest awarded by the learned trial Judge is unjustified and inequitable.
On the whole therefore I resolve this issue partly in favour of the Respondent to the extent that the learned trial Judge was right in holding that the Respondent proved its counter-claim and in awarding the sum of N36,286,748.02 in favour of the Respondent/counter-claimant against the Appellant.
However, with respect to the award of interest at the rate of 19% per annum ‘from 2005 until liquidation’, the issue is resolved against the Respondent and in favour of the Appellant.
Consequently, issue No. 1 having been resolved against the Appellant, issue No. 2 in favour of the Appellant and issue No. 3 partly against and partly in favour of the Appellant, this appeal is allowed in part. In effect the learned trial Judge was wrong to have dismissed the Appellant?s claim for wrongful dishonour of her cheques. The Appellant is therefore entitled to damages against the Respondent.
Similarly, the Court was wrong in awarding interest at the rate higher than the prescribed maximum rate or more than was asked for.
The Court was however, right in holding that the Respondent proved its counter-claim
Resultantly, the appeal succeeds in part and it is ordered as follows:
1. The Order of the lower Court that the Appellant shall pay the Respondent the sum of N36,286,748.02 (Thirty Six Million, Two Hundred and Eighty-Six Thousand, Seven Hundred and Forty-Eight Naira Two Kobo) only being the outstanding balance against her as at 31/12/2005, is affirmed.
2. The Order dismissing the Appellant’s claim is set aside and in its stead, the Appellant being a trader, is entitled to substantial damages for the wrongful dishonour of her cheques, which in the circumstances of this case, is reasonably assessed at N5,000,000.00 (Five Million Naira Only) against the Respondent.
3. The Order awarding the Respondent interest against the Appellant at the rate of 19% per annum from September 2005 until liquidation is set aside.
4. Parties shall bear their respective costs.
IBRAHIM SHATA BDLIYA, J.C.A.: I have had the opportunity of reading in draft the leading judgment delivered by my noble lord, AMINA AUDI WAMBAI, J.C.A. I totally agree with the reasons leading to the allowing of the appeal in part. On the granting of ten percent (10%) post judgment interest, I agree that same is grantable in the circumstances of the case. That trial Court has the power to award 10% post judgment interest as permitted by the Rules of Court has been reinforced in a plethora of judicial decisions by the Superior Courts. For instance, inFBN Plc v. Excel Plastic Ltd (2003) 13 NWLR (Pt. 837) P. 412@ 417, when considering the provisions of Order 40, Rule 7 of the Cross River State (Civil Procedure) Rules, on post-judgment, and when to be awarded, held that:
”By virtue of Order 40, Rule 7 of the High Court of Cross River State (Civil Procedure) Rules, the High Court has the jurisdiction to award a post-judgment interest whether or not such claim was prayed for. However the rate of interest so awardable is limited to a rate not exceeding ten per centum per annum. In this case, the trial Court was right to have awarded a post-judgment interest which was not pleaded, but the Court was equally in error to have made the award at the rate of 17.5% thereby exceeding the statutory limit.”
The learned judge of the lower Court was therefore in error when he granted 19% interest as post-judgment interest. As to the counter claim, I agree that same was proved by the respondent.
OBIETONBARA O. DANIEL-KALIO, J.C.A.: I have read the draft judgment of my learned brother AMINA AUDI WAMBAI JCA. I agree.
Appearances:
John M. Omughele, Esq.For Appellant(s)
Dzever, S. Stephen, Esq.For Respondent(s)
