UBA PLC v. MIDAS SANDRA NIG. LTD (2020)

UBA PLC v. MIDAS SANDRA NIG. LTD

(2020)LCN/15615(CA)

In the Court of Appeal

(CALABAR JUDICIAL DIVISION)

On Wednesday, October 28, 2020

CA/C/199/2016

Before Our Lordships:

Mojeed Adekunle Owoade Justice of the Court of Appeal

Hamma Akawu Barka Justice of the Court of Appeal

Muhammed Lawal Shuaibu Justice of the Court of Appeal

Between

UNITED BANK FOR AFRICA PLC APPELANT(S)

And

MIDAS SANDRA NIGERIA LIMITED RESPONDENT(S)

RATIO:

THE BURDEN OF PROOF

GIVING EVIDENCE AND CROSS EXAMINATION

In the light of the foregoing, then on what basis did the learned trial judge came to the conclusion that the rift or disagreement was attributable to the appellant? It is my view that the discrepancy been alluded to cannot be proved through the Audit report, Exhibit 7 without the maker been called to give evidence and be cross examined on the said report. The same applies mutatis mutandi to the Unilever’s letter citing “stalemate” as an obstacle without an official of Unilever been called as a witness to shade light as regards the unsettled invoices. Thus, there was no conclusive evidence before the lower Court that the rift in question was attributable to the appellant .MUHAMMED LAWAL SHUAIBU, J.C.A

THE NECESSARY PARTIES IN A SUIT
The law is also settled that a beneficiary of a contract to which he is not a party cannot sue on such a contract nor would a stranger to a contract sue to enforce the contract. Thus, Unilever Plc. not been a party to the contract upon which the respondent sued the appellant for negligence in handling its account cannot be a necessary party to the suit. In other words, the suit at the lower Court could be effectively and completely be determined without Unilever been made a party. At any rate the non-joinder of a party will not render the proceedings a nullity. Issue three is resolved against the appellant .MUHAMMED LAWAL SHUAIBU, J.C.A

THE BREACH OF AN AGREEMENT
It is also pertinent to note that the contractual relationship between the plaintiff and the defendant was
regulated by the Deed of Hypothecation duly executed by the parties on the 3rd of October 2001 and then the question as to whether or not there is any breach of that agreement; recourse must necessarily be made to the said agreement. The next germane issue is, did the respondent as plaintiff plead or lead evidence to show the appellant failure to exercise due care or that it was the appellant’s failure that caused the alleged loss or injury? MUHAMMED LAWAL SHUAIBU ,J.C.A

NEGLIGENCE HAS TO BE ESTABLISHED FOR THE QUESTION OIF DAMAGES TO RISE

The law is that where negligence against the appellant was not established, the question of damages resulting therefrom does not arise at all. Now having held the view that the respondent did not conclusively prove that the alleged rift or disagreement in handling the respondent account domiciled in the appellant was due to the fault of the appellant, the question of damages did not arise at all. That notwithstanding, the point must be made clear that in a claim for special damages, the obligation to particularize arises not because the nature of the loss is unusual but because the plaintiff who has the advantage of being able to base his claim on a precise calculation must give defendant access to facts which make such calculation possible. S.P.D.C.N. LTD V. TIEBO (2005) 9 NWLR (prt 931) 439 DUMEZ (NIG) LTD V. OGBOLI (1972)1 ALL NIR 241 and AJIGBOTOSHO V. R.C.C. LTD (2009)3 NWLR (prt 1659) 287. MUHAMMED LAWAL SHUAIBU, J.C.A

MUHAMMED LAWAL SHUAIBU, J.C.A. (Delivering the Leading Judgment): This appeal is against the judgment of the High Court of Akwa Ibom State sitting at Eket Judicial division delivered on 22nd June, 2015 wherein the lower Court found the appellant negligent in handling the respondent’s account domiciled in the appellant.

The respondent as plaintiff at the lower Court took out a writ of summons and statement of claim against the appellant herein respectively filed on 14/1/2006 and 25/5/2006. In paragraph 45 of the Further Amended statement of claim respondent as plaintiff claimed from the defendant/appellant as follows:-
45. Whereupon, the plaintiff claims from the defendant as follows:
1. A. Special Damages
1. Auditing Fees – Three Hundred and Fifty Thousand Naira- N350,000.00
2. Legal Fees – Four Hundred Thousand Naira- N400,000.00
3. Hotel Accommodation 30th March-April 1st,2005- N28,500.00
4. Hotel accommodation 8th – 10th December,2004- N31,000.00
5. Car hiring in Lagos for four days (4 days)- N40,000.00
6. Filling Fees for Suit No. HEK/115/2004 Six Thousand Naira- N6,000.00
7. Phone calls – Ten Thousand Naira- N10,000.00
8. Entertainment during meeting in Eket-Twenty-Five Thousand Naira- N25,000.00
9. Filing fee for HEK/4/2006- Sept 30th, 2001- N6,000.00
Sub Total = N896,500.00
B. The sum of N8,654,690.41 (Eight Million, Six Hundred and Fifty-Four Thousand, Six Hundred and Ninety Naira, Forty-One Kobo) representing unwarranted debits by the defendant on the plaintiff’s account with its (defendant’s) bank.
GRAND TOTAL OF SPECIAL DAMAGES: N9,551,190.40k (Nine Million, Five Hundred and Fifty-One Thousand, One Hundred and Ninety Naira, Forty-One Kobo).
2. A declaration that interest calculated against plaintiff account by the defendant from the month of September 30, 2001 till date is null and void and of no effect, being questionable and predicated on false accounting process.
3. The sum of N150,000,000.00 (One Hundred and Fifty Million Naira) being general damages for negligence.
PARTICULARS OF NEGLIGENCE
1. The defendant had a duty as the plaintiff’s bankers to efficiently administer the funds of the plaintiff it held in trust by:
(a) Ensuring that the invoices of goods supplied by Unilever Nig. Plc. To the plaintiff were promptly paid by debiting the plaintiff’s account with it.
(b) Crediting money paid by the plaintiff into its account promptly and without delay.
(c) Ensuring that the information supplied in the statement of account issued by the defendant to the plaintiff represents a true and correct position of transactions.
2. The defendant in flagrant breach of the aforementioned duties failed/neglected to neither credit the account of the plaintiff promptly nor pay Unilever Nig. Plc. for retired invoices by debiting plaintiff’s account as and when due. The defendant also failed/neglected to provide plaintiff with a true and correct position of its record of transactions with the defendant through wrong entries, duplications, overpayments etc. in the statement of accounts issued to the plaintiff by the defendant.
3. Following the serious distortions of the account of the plaintiff by the negligent acts of defendant, the plaintiff’s business was suspended by non supplies by Unilever Nig. Plc. Since April 2004, and finally on 3rd February, 2006, the Key Distributor status with its attendant right and privileges enjoyed by plaintiff was revoked by Unilever Nig. Plc. which means a great economic loss suffered by the plaintiff based on the negligent act of the defendant.

Upon being served with the originating processes, the defendant denied the claims and maintained that she was not negligent in any way in handling the plaintiff’s account.

Pleadings were filed and exchanged and the matter proceeded to trial with each party calling a witness and tendered documentary exhibits. In a reserved and considered judgment delivered on 22/6/2016, learned trial judge found in favour of the plaintiff now respondent at pages 317 – 318 of the record of appeal as follows:-
“On the whole it is my holding that the plaintiffs from the foregone would be entitled to damages as her case succeeds. In calculating general damages I would take into consideration the fact that the plaintiff was described as a key distributor to Unilever Nig. Plc and covered extensively, three Local Government Areas of Eket, Oron and Ikot Abasi. I will consider the clientele and customers abounding in those cities and beyond for the business of the plaintiff. I will consider any business goodwill lost. I will consider the progressive nature of the volume of facility then available with the defendant for the plaintiff. It is agreed that it began in 2001 with N3 Million. It increased to N5 million by 2002 and further increased to N9 Million by 2003. I imagine how much the trade facility would have grossed by 2015. I would also take into account the turn over volume of the plaintiff. Both parties agreed that even at its declined stage in the year 2003 the volume had reached up to N66 Million worth. I would of cause recall the near carefree manner in which the defendant handled the affairs of the plaintiff without apologies.
I would have to also consider the fallen value of the naira in favour of the plaintiff.
On the other hand I would discount the depressive state of the Nigerian economy. I would also consider the rising cost of doing business generally.
In the end, I would and do hereby hold that the case of the plaintiff succeeds against the defendant.
I assess the general damages payable by the defendant to the plaintiff in the sum of N40,000,000 Forty Million Naira only. The defendant is ordered to pay same forthwith over to the plaintiff.
Cost of this action is put at N50,000.00 payable by the defendant to the plaintiff.”

Dissatisfied, appellant appealed to this Court through a notice of appeal filed on 29/06/2015. By leave of this Court, appellant amended her notice of appeal on 24/9/2020 and the said 2nd amended notice of appeal contains nine (9) grounds of appeal.

At the hearing of the appeal on 8/9/2020, Prince I. Nwafuru Esq. adopted and relied on the appellant’s brief of argument and appellant’s reply brief respectively filed on 4/9/2018 and 4/9/2020 but both deemed as properly filed on 8/9/2020 in urging this Court to allow the appeal. Chidi Anyawu, Esq. adopted and relied on the respondent’s brief of argument filed on 29/5/2020 and deemed as properly filed on 8/9/2020 in urging this Court to dismiss the appeal.

In the appellant’s brief of argument, four issues are formulated for the determination of the appeal as follows:-
1. Considering the fact that the instant Suit was commenced with incurably defective originating processes, whether the trial Court acted without jurisdiction in determining the said Suit? (Distilled from ground 9).
2. Considering the state of pleadings and evidence adduced, whether the respondent pleaded facts and adduced evidence, sufficient enough howsoever, to be entitled to the grant of the Reliefs sought in the Further Amended Statement of Claim? (Distilled from grounds 1,3,4,5 and 8).
3. Was the trial Court right in holding that the presence of Unilever Plc was not necessary for the determination of the Suit? (Distilled from 6 and 7).
4. Was the trial Court right in law in awarding general damages in favour of the respondent against the appellant in the sum of N40,000,000.00 (Forty Million Naira)? (Distilled from ground 2).

On the part of the respondent, three issues are formulated for the determination of the appeal thus:-
1. Whether Suit No. HEK/4/2006 was commenced with incurable originating processes which robbed the trial Court of the jurisdiction to determine the suit.
2. Whether the respondent proved facts and adduced evidence to be entitled to the general damages awarded by the trial Court.
3. Whether non-joinder of Unilever Plc. as a party to this suit is fatal to the suit.

The contention of the appellant on her issue one above is that the writ that ignited the suit at the lower Court was not signed by a legal practitioner and therefore incurably defective. He referred to Order 6 Rule 2(3) of the Akwa Ibom State High Court (Civil Procedure) Rules 1989 to contend that each copy of the writ shall be signed by the legal practitioner or by a plaintiff and shall be certified after verification by the Registrar as being a true copy of the original process filed. He submits that the writ having not been signed by the respondent herein nor her legal practitioner, the lower Court lacked the requisite jurisdiction to adjudicate on the suit. Consequently, the suit as well as all the proceedings and decision of the lower Court are nullity and same should be set aside in its entirely. He referred to MADUKOLU V. NKEMDILIM (1962) ALL NLR 581 at 589 – 590 and BASSEY & ORS V. EDEM & ORS (2016) LPELR- 42054 (CA) to the effect that an unsigned writ of summons is incompetent and worthless.

On issue two, the appellant submitted that the burden is on the respondent as plaintiff to plead and lead credible evidence in respect of her case to be entitled to the reliefs sought. Learned counsel for the appellant contend that the essential elements of tort of negligence are that (i) the appellant owes the respondent a duty of care, (ii) the duty of care was breached by the act of the appellant and (iii) the respondent suffered damages arising from the breach. He submits that the lower Court having acknowledged that the respondent did not plead essential facts on the issue of interest which constitute one of the charges made in the account, it would therefore not have been possible for the respondent to prove the facts of wrongful charges, when the essential facts were not pleaded. Thus, the burden can only move to the appellant when the respondent has discharged the evidential burden. He submits that the respondent failed to prove its allegation of wrongful charges and therefore the finding of the lower Court that the appellant has proved its case is totally perverse.

Still in argument, learned counsel to the appellant referred to the finding of the lower Court in respect of Exhibit 14 where Unilever cited “stalemate” with the defendant as the obstacle to Unilever carrying on with the respondent in the business and hence attributed the fault on the appellant. He contends that there is no evidence that the rift in question was the fault of the appellant. He also referred to Exhibit 13, the termination letter wherein Unilever urged the respondent to pay the outstanding debts of N12,206,692.45 representing all the unpaid invoices for stocks long received and at the same time advising the respondent to make necessary arrangement to settle with appellant. In the absence of any evidence from the Unilever official to substantiate the allegation against the appellant, the lower Court according to the learned counsel was in error in holding that the appellant was negligent.

In further argument, learned appellant’s counsel submits that had the lower Court properly considered the appellant’s averments it would have found that the appellant did not only specifically deny the respondent’s averments, but also led evidence in rebuttal. Thus, the lower Court having held that the appellant’s statement of defence fitted its intended purpose and applied relevantly to the averments in the Further Amended Statement of claim, cannot turn around to hold that the appellant did not specifically deny the averments in the statement of claim. Also given the nature of the reliefs sought by the respondent which are declaratory in nature; same cannot be granted on the mere admission relying on the authority in the case of CPC V. INEC (2012) LPELR- 15522 (SC) pages 34 – 35.

The appellant’s counsel contend that relief 1 and 3 of the respondent relate to the claim for special and general damages wherein the lower Court upon realizing that the respondent has failed to plead and prove the special damages opted to compensate the respondent by granting its claim for general damages. He submits that to award special damages the burden of proof is on any one claiming it to prove strictly that he did suffer such special damages claimed. Thus, the person claiming it should establish his entitlement by credible evidence of such character as would establish that he indeed, is entitled to an award under that head. And that where the respondent failed to lead credible evidence to prove its special damages, the Court cannot compensate such a plaintiff with huge amount under general damages. He refer to WAHABI V. OMONUWA (1976) LPELR- 3469 to the effect that general damages are those which the law implies in every breach of contract and where no real damage has been suffered which may be a trifling amount.

On issue three, the appellant contend that given the role played by Unilever in the transaction that gave rise to the suit, Unilever is a necessary party to the suit. It was contended that the respondent’s claim is rooted in negligence and the purported breach of duty of care by the appellant which breach the respondent claimed led to the termination of the Distributorship Agreement between Unilever Plc and the respondent. Thus, in determining whether or not it is the appellant’s purported breach that led to the termination of the Distributorship Agreement, the presence of Unilever Plc was necessary for the effective and effectual determination of the issue in controversy in the suit.

On issue four, the appellant contend that the general damages awarded in favour of the respondent was based on incorrect variables and therefore highly speculative as there was no shred of evidence to support it. The appellant contend further that there is no evidence supporting the lower Court’s finding on “clientele and customers abounding in those cities and beyond for the business of the plaintiff”, the respondent’s annual turnover as well as the respondent’s goodwill including the value of Naira at the material time of the transaction. It was thus submitted that the opinion of the learned trial judge on these critical facts cannot take the place of evidence and having premised its assessment of general damages on wrong principle and unpleaded and unproven facts, this Court was urged to interfere with such award. Reliance was placed on the cases of INTERNATIONAL NIGERIAN MESSENGERS LTD V ENGR. DAVID NWACHUKWU (2004)13, NWLR (prt. 891) 543 at 565 and EDWARD OKWEJIMINOR V G.GBAKEJI & ANOR (2008) LPELR – 2537 (SC) to the effect that there are substantial grounds to interfere with the award of damages by the lower Court.

On its part, the respondent argued in respect of its issue one that under the 1989 High Court Rules of Akwa Ibom State the plaintiff or his legal practitioner was required only to do the endorsement in the writ and take it to the Registrar of the High Court to issue same. It is after the Registrar has signed and stamped a writ that it is deemed to be duly issued. Thus, there was no requirement under the applicable rules of Court when the suit was filed for either the party or his legal practitioner to sign a writ. Learned counsel for the appellant referred to BAYERO V. MAINASARA (2007) ALL FWLR (prt. 359) 1285 to contend that a writ of summons is issued upon it being signed by the Registrar or other officer of the Court duly authorized to sign the writ.

On issue two, the respondent contended that it proved the facts and also adduced credible evidence through pw1 in showing that the appellant was negligent in handling its account leading to the respondent’s failure to pay Unilever for the goods supplied and thereby precipitated into the termination of the respondent’s Key Distributorship.

Respondent contended further that it proved facts and adduced credible evidence through the audit report and account statements to show that the appellant not only misapplied and mismanaged its fund but also made unjustified debits and deductions from its account and also failed to retire invoices submitted to it by Unilever Plc for goods supplied to the respondent despite having sufficient credit in its account at the material time. Respondent referred to Exhibits 3, 4, 6 and 7 to show that sufficient evidence was adduced to sustain all the claims made at the lower Court. Respondent also contended that vide the appellant’s letter Exhibit 3, the appellant acknowledged the allegation of being negligent in handling respondent’s account but attributed same to network failure. It was thus submitted that facts admitted requires no further proof; citing Section 123 of the Evidence Act and the cases of SUNDAY OFFOR & ANOR V. THE STATE (2012)12 MJSC (prp11) 41 and NARINDEX TRANST LTD V. N.I.C.M.B. LTD (2001) FWLR (prt 1551) 8.

Still in argument, the respondent submits that having discharged its burden of proof under Sections 131 (1) (2) 123 and 134 of the Evidence Act, 2011, the burden then shifted to the appellant who merely denied the respondent’s claims albeit by general traverse which did not adduces the several specific allegations made by the respondent.

In response to the appellant’s argument on its entitlement to the general damages awarded by the lower Court, the respondent relied on the authority in the case of ANDREW V. MTN (NIG) COMM. LTD (2017) ALL FWLR (prt 900) 518 at 580 to contend that general damages need not to be specifically pleaded or proved. It arises from the inference of law and suffices if it is generally averred. Thus, its award is presumed by law to be direct and probable consequences of the act coupled of.

On issue three, the respondent contend that having shown that the unjustified deductions and debits made by the appellant in the respondent’s account as well as the misapplications of the respondent’s account were carried out solely by the appellant, it was thus unnecessary to join Unilever Plc as a party to the suit before the lower Court. It is therefore the plaintiff’s claim that gives the right to initiate the action for the alleged wrongful act. And where a defendant feels that the outcome of the suit will adversely affect his interest, he can apply to be joined before the matters proceeds to trial. The respondent cited the case of MAINSTREET BANK PLC. V. DIZENGOFF (W.A) NIG. LTD (2015) ALL FWLR (prt 781) 1443 at 1452 to buttress its argument that Unilever Plc played no role whatsoever in the entire process of infractions on the respondent’s account by the appellant and thus not a necessary party.

The appellant as stated elsewhere in this judgment has filed a reply brief and a careful perusal of same reveals that it is an improvement of its main brief. It is settled that a reply brief is meant to respond to new issues raised by the respondent in his brief. Therefore, whereas in this case, a reply brief goes outside the parameters set for it, the Court is duty bound to ignore and discountenance it. That being the position, the appellant’s reply brief filed on 4/9/2020 is ignored and discountenanced.

Turning back to the respective argument on the issues formulated for the determination of this appeal, the said issues in my view are basically the same even though couched differently. However, the appellant’s issues Nos. 2 and 4 can conveniently be subsumed into the respondent’s issue No.2. I shall therefore determine this appeal on the basis of the appellant’s issues Nos. 1 and 3 as well as the respondent’s issue No. 2. For the sake of clarity these issues are reproduced hereunder as follows:-
1. Considering the fact that the instant suit was commended with an invariably defective originating processes whether the trial Court acted without jurisdiction in determining the said suit?
2. Whether the respondent proved facts and adduced evidence to be entitled to the general damages awarded by the trial Court?
3. Was the trial Court right in holding that the presence of Unilever Plc was not necessary for the determination of the suit?

RESOLUTION
The appellant’s grouse on issue one relates to the commencement of the suit at the lower Court wherein it alleges that same was commenced with a defective writ. It is beyond argument that the validity of the originating process in a proceeding before a Court is fundamental and necessary requirement for the competence of the suit. The validity of originating processes in a proceeding before a Court is a sine qua non, an indispensable condition, necessary for the competence of the suit and indeed proceeding initiated by such processes. Thus, failure to commence a suit with a valid writ and or statement of claim goes to the root of the action since the conditions precedent to the exercise of the Court’s jurisdiction would not have been met to duly place the suit before that Court. See MADUKOLU V. NKEMDILIM (supra), KIDA V. OGUNMOLA (2006) 13 NWLR (prt 797) 377, OKAFOR V. NWEKE (2007) 10 NWLR (pt 1043) 521 and S.L.B. CONSORTIUM LTD V. NNPC (2011) 9 NWLR (prt 1252) 317.
Parties in suit No HE/L/4/2006, which gave rise to this appeal are ad idem as to the fact that the applicable rules was the writ taken out as at the time of the commencement of the suit that is, the Akwa Ibom State High Court (Civil Procedure) Rules 1989. Order 5 Rule 1 of the said rules provided that –
“A writ of summons shall be issued by the Registrar or other officer of the Court empowered to issue summonses on application. The application shall ordinary be made in writing by the plaintiff’s solicitor by completing Form 1 in the Appendix to these rules, but the Registrar or other officer as or aforesaid where the application for a writ of summons is illiterate or has no solicitor may dispense with a written application and instead himself record full particulars of an oral application made and on that record a writ of summons may be prepared signed and issued”.
Order 5 Rule 12 (1) of the said Rules states further that –
“Where a plaintiff sues by a legal practitioner, the writ shall be endorsed with the plaintiff’s address and the legal practitioner’s name, or firm and a business address of his within the jurisdiction and also; if the legal practitioner is the agent of another, the name or firm and business address of his principal.”
From the above, the rules do not require a party or his legal practitioner to sign the writ of summons. And a perusal of the record of appeal reveals that after the writ of summons was signed and issued by the Registrar of the lower Court on 13th January 2006, the plaintiff’s counsel subsequently prepared, signed and filed the plaintiff’s statement of claim. In BAYERO V. MAINASARA (supra) cited and relied by the respondent, it was emphatically held that a writ of summons is issued upon it being signed by the Registrar or other officer of the Court duly authorized to sign the writ. Therefore, the writ of summons in the instant suit was validly issued and the lower Court had the competence and the requisite jurisdiction to hear and entertain the suit. I resolve issue one in favour of the respondent.

The appellant’s complaint on issue two is that the lower Court erred in its findings in the sense that the respondent has failed woefully to prove its claim of negligence nor prove the allegation of the unwarranted debit from the respondent’s account. In essence, the award of damages to the respondent was anchored on a wrong principle of law on award of general damages.

The respondent’s case at the lower Court was that the defendant now appellant had a duty as the plaintiff’s bankers to efficiently administer its funds by ensuring that the invoices of goods supplied by Unilever Plc to the plaintiff were promptly paid by debiting the plaintiff’s account with it. It was also the plaintiff’s case that the defendant in flagrant breach of the said duty to credit its account or pay Unilever Nig. Plc. for retired invoices and also following the serious distortion of its account the plaintiff’s business was suspended by non supplies by Unilever Plc. And thus the Key Distributorship right been enjoyed by the plaintiff was revoked. The plaintiff’s case was succinctly stated in paragraphs 7 – 25 of Further Amended statement of claim at pages 196 – 197 of the record of appeal as follows:-
7. The plaintiff became a Key Distributor to Unilever Nig. Plc. in 2001 and it was in the same year that the defendant was appointed by the said Unilever Nig. Plc. to finance plaintiff’s business.
8. The defendant granted the plaintiff a facility to enable it operate its Key Distributorship with Unilever Plc.
9. The facility granted was not to be cashed but to remain resident with the defendant.
10. Payment to Unilever Nig. Plc. was to be drawn from this facility which to a large extent depended on lodgments by the plaintiff.
11. Apart from the lodgments to be made with the defendant from sales by plaintiff, the plaintiff secured the facility with collateral in the form of landed property.
12. Lodgment was made on a daily basis since invoices were retired based on the availability of funds in plaintiff’s Key Distributorship Account.
13. The said Unilever had an arrangement with the defendant to settle or retire invoices for goods supplied to plaintiff upon presentation of such invoices by Unilever Nig. Plc.
14. The regularity and or flow of supplies to plaintiff were to be predicted upon availability of funds in plaintiff’s account and prompt retirement of the invoices presented by the Unilever to the defendant.
15. On commencing the business in October, 2001, the plaintiff started with a facility of N3,000,000.00 (Three Million Naira). In October, 2002 it was increased to N5,000,000.00 (Five Million Naira) and in 2003 it was further increased to N9,000,000.00 (Nine Million).
16. Increase in facility was normally matched with a corresponding increase in stock supplies and its attendant increased turnover. This position when translated to actual saw plaintiff with a stock value of N71,000,00. (Seventy-One Thousand Naira) achieved with a facility of N5,000,000.00 (Five Million Naira) in the year 2002.
17. In the year 2003, the plaintiff received only a total stock value of N66,000,000.00 (Sixty-Six Million Naira) against an increased facility of N9,000,000.00 (Nine Million Naira).
18. This declined sparked off investigation by the plaintiff since there was no justifiable reason for the reduction in the turnover when the cost of capital had gone up. To attain this objective, the plaintiff on 25th June, 2004 engaged the services of S.B.U Ndede & Co. a firm of Chartered Accountants to audit the said plaintiff account and was charged the sum of N350,000.00 (Three Hundred & Fifty Thousand Naira) and was issued a receipt of payment. The plaintiff hereby pleads the cash receipt issued to him by the said firm of Chartered Accountants and the Auditors Report.
19. In February, 2004, the plaintiff discovered that some strange invoices accumulated by the defendant had been debited to its account en bloc. The total value of the invoices was N2,600,000 (Two Million, Six Hundred Thousand Naira).
20. The said accumulated invoices were executed in the year 2001 and 2002 and the following invoice numbers with their dates fall within this class: invoices Nos. 87105, 86882, 105956, 91495, 86801, 91119, 94177 and 90637. The said invoices were confirmed and admitted by the defendant in its letter of 5th April, 2004 to the plaintiff. The said letter of 5th April, 2004 is hereby pleaded and the invoice numbers are replicated in the table below.
Invoice No. Date on Invoice Posting date Value of Invoice Delay period
87105 6-6-2001 9-2-2004 103,740 28 Months
86882 29-9-2001 9-2-2004 106,732 29 Months
105956 13-4-2002 9-2-2004 124,222 22 Months
91495 25-11-2001 9-2-2004 168,328 27 Months
86801 29-9-2001 9-2-2004 213,465 29 Months
91119 24-11-2001 9-2-2004 532,811 27 months
94177 23-12-2001 9-2-2004 672,182 26 months
90637 17-11-2001 9-2-2004 719,913 27 months
21. When the defendant noticed the delay in retiring these invoices and that Unilever Nig. Plc. had reduced the volume of goods supplied to the plaintiff, they made a bulk withdrawal of N2,600,000.00 (Two Million, Six Hundred Thousand Naira) and retired all the invoices after an average of 27 Months delay.
22. This sudden and unexpected withdrawal of the sum of N2,600,000.00 (Two Million six Hundred Thousand Naira) from the plaintiff’s account was made without the notification of the plaintiff either before or after the said withdrawal, and without any reason for withdrawing and delaying the invoices for that long period of time.
23. On this shocking discovery, plaintiff promptly notified the defendant through its counsel then Onyeama Obike Esq. who swiftly on 27th April, 2004 wrote to the defendant demanding an explanation to its action and an express demand for reversal of the account. Counsel’s letter of 27th April, 2004 is hereby pleaded.
24. The defendant by its letter LSD/LD/OMO/666/2004 dated the 17th day of May, 2004 asked for the understanding and co-operation of the plaintiff while they look into the matter which they never did.
25. Before this time, Eket Branch of the defendant through their Manager had already in a letter of 5th April, 2004 written the plaintiff offering what they considered an explanation to the delay. They attributed the said delay to what they called “Network Failure” an explanation that was unacceptable to the plaintiff. The said letter of 5th April, 2004 from the defendant Eket Branch is hereby pleaded.

Also in paragraphs 29 – 37 of the said Further Amended statement of claim, the plaintiff now respondent averred thus:-
29. The plaintiff avers that for effective running of its business, that it has invested well over N20,000,000.00 (Twenty Million Naira) which were funds generated from the Managing Director’s retirement benefits among other sources. This amount covers stocks, hiring of warehouses, office accommodation and vehicles or field services, equipment and hiring of field and office staff.
30. The plaintiff contends that since year 2003, its business had been on the downward trend because of the defendant under applied funds available to it for business, invoices were not promptly settled consequent upon which steams of supply to plaintiff was either reduced or cut off completely.
31. The plaintiff herein states that a further instance of such a negligent handling of its finances was when a cash lodgment of N151,990.00 (One Hundred and Fifty One thousand, Nine Hundred and Ninety Naira) made on 31st May, 2002 was not credited to its account by the bank until after about five (5) whole months when plaintiff discovered it and protested. The said protest letter as well as the bank’s reply are hereby pleaded and shall be relied upon during the trial.
32. Furthermore, in June 2002, the defendant did not retire any invoices for the whole of the month despite evidence of daily lodgment and cash available in the plaintiff’s account. The Bank Statement of Account is pleaded and shall be relied upon at the trial.
33. It is further contended by the plaintiff that the defendant consistently displayed unprofessional and unethical behaviours in the handling of plaintiff’s account when it debited the account of plaintiff to the tune of N2,224,497.00 (Two Million, Two Hundred and Twenty Four Thousand, Four Hundred and Ninety Seven Naira), using non-existent invoices as in the case of invoice No.201048966. The plaintiff shall rely on the April 2002 statement of account sent to it by the defendant which is hereby pleaded.
34. In the same vein, invoice No. 090636 was duplicated by the defendant and used in debiting plaintiff’s account to the tune of N303,688.88 (Three Hundred and Three Thousand, Six Hundred and Eighty Eight Naira, Eighty Eight Kobo). The defendant’s January, 2002 Statement of Account to the plaintiff and shall be relied upon at the trial.
35. Similarly, Invoice No. 011993 was duplicated and used by the defendant in debiting the plaintiff account to the tune of N888,511.55 (Eight Hundred and Eighty Eight Thousand, Five Hundred and Eleven Naira, Fifty Five Kobo). The defendant’s July 2002 Statement is pleaded and shall be relied upon at the trial. The defendant is hereby placed on notice to produce the said invoice at the trial.
36. The plaintiff avers that the defendant acted in breach of all known standard accounting procedures when it failed to specify invoices with their corresponding numbers that were retired and paid for but choose to lump payment together, thereby creating confusion and making it impossible to reconcile the account of the plaintiff at the appropriate time. This can be exemplified with the transaction of November, 2001 as shown in three Statement of Account where the sum of N1,667,699.00 (One Million, Six Hundred and Sixty Seven Thousand, Six Hundred and Ninety Nine Naira) was debited in the account of the plaintiff without stating which invoices accounted for the amount so debited. The said Statement of Account is pleaded and shall be relied upon at the trial.
37. Again, in May 2002, the sum of N3,560,392.00 (Three Million, Five Hundred and Sixty Thousand Three Hundred and Ninety Two Naira.) was paid en bloc without specifying which invoices actually made up the amount purportedly paid and plaintiff’s account debited. We shall further rely on the May 2002 Statement of Account at the trial. The said Bank Statement is hereby pleaded.

The general rule in civil cases is that the burden of proof rests upon the party who substantially assert the affirmative before the evidence go into. In other words, the burden of proof lies on the person who will fail assuming no evidence had been adduced on either side. See Section 133 (1) of the Evidence Act, 2011. As could be gleaned from the above, the respondent asserted that the resultant suspension of supplies by Unilever Plc. and rejection of Key Distributorship right through the negligence handling of respondent’s account by the appellant caused it loss and therefore the respondent has the burden of proving those assertions. In other words, where the plaintiff pleads and relies on negligence by conduct or action of the defendant, the plaintiff must prove by evidence the conduct or action and the circumstances of its occurrence, which give rise to the breach of duty of care, owed the plaintiff. It is only after this that the burden shifts to the defendant to adduce evidence to challenge negligence on his part. See UTB. (NIG) V. OZOEMENA (2007)3 NWLR (prt 1022) 448.
Before determining whether or not the respondent as plaintiff at the lower Court has proved by evidence the conduct or action as well as the circumstances of the respondent’s negligence, it is pertinent to state that the most fundamental ingredient of the tort of negligence is the breach of the duty of care which must be actionable in law and not moral liability. And until a plaintiff can prove by evidence the actual breach of the legal duty of care against the defendant, the action must fail per Kalgo, JSC in ANYAH V. IMO CONCORD HOTELS LTD (2002) LPELR 512 (SC). Therefore, negligence is a tort and it is complete and actionable when three conditions are satisfied and these are:
(i) The defendant owed a duty of care to the claimant;
(ii) The duty of care was breached and
(iii) The claimant suffered damages arising from the breach. See ABUBAKAR V. JOSEPH (2008)13 NWLR (prt 1104)307, IYERE V. BENDEL FOODS & FLOUR MILLS LTD (2008)18 NWLR (prt 1119) 300 and KABO AIR LTD V. MOHAMMED (2014) LPELR – 2361 (CA).

In its quest to prove its claim against the appellant, the respondent called pw1 Chief Emeka Awah, Managing Director of the respondent who tendered several documents to buttress the contention that the appellant had misapplied and underapplied the respondent’s account which impacted negatively on the respondent’s business. The said documents are –
1. Defendant’s letter addressed to the plaintiff date 17/5/2004 – Exhibit 5.
2. Reminder letter from plaintiff to the defendant dated 8th June, 2004 – Exhibit 6.
3. Letter of plaintiff dated 23/7/2004 to the defendant – Exhibit 7.
4. Protest letter of plaintiff to the defendant dated 25/10/2012.
5. Receipt of limousine shuttle service dated 1/4/05 – Exhibit 9.
6. Plaintiff’s several statement of account admitted as a bundle marked as Exhibits 10A, 10B, 10C, 10D and 10E respectively.

7. Letter of plaintiff to the defendant on the withdrawal of suit No. HC/C/115/2004 – Exhibit 11.
8. Receipt of payment by MD. Plaintiff for Hotel accommodation received as a bundle and marked as Exhibit 12A and 12B.
9. Letter of revocation of plaintiff’s status as Key Distributor of Unilever dated 3/2/2006 as Exhibit 13.
10. Letter dated 18th June 2006 from Unilever to the plaintiff – Exhibit 14.
11. Receipt dated 2/12/2005 for Hotel accommodation for meeting – Exhibit 15.
12. Stock delivery book containing invoices with particular reference to weeks 24 and of 16/11/2001 thereof – Exhibit 16.

The respondent as plaintiff also tendered Exhibits 17 – 21 which apparently formed the bedrock of the relationship between the appellant and the respondent as found by the lower Court at page 295 of the record of appeal thus:-
“From the foregoing admitted facts and the Exhibits 17-21 referred, it is easy to conclude that the plaintiff and the defendant had a contractual relationship driven by mutual trust, in which the plaintiff was expected to routinely or daily pay in money into her account while the defendant provides credit facilities to enable the plaintiff effectively operate the Key Distributorship business, the plaintiff had with the Unilever Plc.”
It is also pertinent to note that the contractual relationship between the plaintiff and the defendant was
regulated by the Deed of Hypothecation duly executed by the parties on the 3rd of October 2001 and then the question as to whether or not there is any breach of that agreement; recourse must necessarily be made to the said agreement. The next germane issue is, did the respondent as plaintiff plead or lead evidence to show the appellant failure to exercise due care or that it was the appellant’s failure that caused the alleged loss or injury?

The respondent as plaintiff at the lower Court catalogued the resultant consequences the appellant’s negligence in paragraph 38 of the Further Amended statement of claim thus:-
1. Reduction in turnover
2. Loss of income
3. Unjustifiable interest payment
4. Under utilization and non utilization of facilities acquired by the company for the business.
5. Suspension of the plaintiff’s business by Unilever Nig. Plc.
6. Loss of customers and damages to image and integrity of the plaintiff.
7. Serious financial embarrassment among other things.
8. Loss of key distributorship status, and attendant benefit.

It is to be borne in mind that the approach to a claim in negligence comes into operation in the following circumstances:
(a) On proof of the happening of an unexplained occurrence,
(b) When the occurrence is one which would not have happened in the ordinary course of things without the negligence on the part of somebody other than the plaintiff and
(c) The circumstances point to the negligence in question being that of the defendant rather than any other person.
See F.B.N. Plc V. BANJO (2015) 5 NWLR (prt 1452) 253.

Did the respondent prove the critical facts on the alleged misapplication and under application of its funds held by the appellant? When cross-examined the respondent’s sole witness said –
“The subject matter of coming to Court here is that the defendant debited our account with owing debts which credited discrepancies and distortions and bloating of the account. Without reconciliating all these discrepancies one cannot validly say whether our account is in credit or debit”.

On the allegation of invoices duplication, pw1 said:-
“Yes, we reported to Unilever. In the first place, Unilever introduced us to the defendant… Yes, they are and that was why they invited me to Lagos in connection with the defendant with a view to resolving the contentious issue.”

As regards the respondent’s claim for damages the learned trial judge was skeptical when at page 317 of the record of appeal held as follows:
“Frankly, looking at this claim of the plaintiff for the sum of N150,000,000.00 as damages for negligence, I have an impression that the claim was not one to enable the plaintiff fish out and recover in bits and pieces sundry, albeit identifiable monetary losses that may have been attendant to the negligence or misdeeds of the defendant”.
Inspite of the above skepticism and fear of awarding double compensation, learned trial judge nonetheless awarded N40,000,000 (Forty Million Naira) against the appellant being general damages.
The law is that where negligence against the appellant was not established, the question of damages resulting therefrom does not arise at all. Now having held the view that the respondent did not conclusively prove that the alleged rift or disagreement in handling the respondent account domiciled in the appellant was due to the fault of the appellant, the question of damages did not arise at all. That notwithstanding, the point must be made clear that in a claim for special damages, the obligation to particularize arises not because the nature of the loss is unusual but because the plaintiff who has the advantage of being able to base his claim on a precise calculation must give defendant access to facts which make such calculation possible. S.P.D.C.N. LTD V. TIEBO (2005) 9 NWLR (prt 931) 439 DUMEZ (NIG) LTD V. OGBOLI (1972)1 ALL NIR 241 and AJIGBOTOSHO V. R.C.C. LTD (2009)3 NWLR (prt 1659) 287. Likewise, general damages cannot in any circumstances be properly substituted for special damages where a plaintiff fails to specifically plead and prove special damages. See WEST AFRICAN SHIPPING AGENCY V. KALLA (1978) 3 SC 21. In the instant case, the lower Court was in error in substituting special damages with general damages, the respondent having failed to substantiate its claims for special damages. Issue two is therefore resolved in favour of the appellant.

Issue three deals with propriety of leaving out Unilever Plc. as party to the suit in the lower Court wherein the appellant argued that Unilever Plc. having actively partook at every stage of the transaction that led to the suit; it is a necessary party in whose absence the suit could not effectively be determined.

I have stated right from the onset that the suit that gave rise to this appeal is a claim of tort of negligence which is the failure to use requisite amount of care required by law where duty of care exists. The relationship of the respondent and Unilever was basically a domiciliation of payment agreement. A domiciliation of payment agreement is an agreement between a bank and a borrower to domicile a payment due to the borrower from a third party with the bank. The agreement does not release the borrower from his primary obligation to pay back the loan to the bank as at when due, and does not make the third party to the loan agreement such that the bank can sue the third party on the loan agreement when things do not work out as planned. See JULIUS BERGER (NIG) PLC V. T.R.C.B. LTD (2019)5 NWLR (prt 1665) 219 at 240.
The law is also settled that a beneficiary of a contract to which he is not a party cannot sue on such a contract nor would a stranger to a contract sue to enforce the contract. Thus, Unilever Plc. not been a party to the contract upon which the respondent sued the appellant for negligence in handling its account cannot be a necessary party to the suit. In other words, the suit at the lower Court could be effectively and completely be determined without Unilever been made a party. At any rate the non-joinder of a party will not render the proceedings a nullity. Issue three is resolved against the appellant.

Consequently, the appeal succeeds in part. The erroneous award of N40,000,000.00 (Forty Million Naira) as general damages to the respondent is hereby set aside.
Parties to bear their respective costs.

MOJEED ADEKUNLE OWOADE, J.C.A.: I have had the privilege of reading in draft the judgment delivered by my learned brother, Muhammed L. Shuaibu. JCA.
I agree with the reasoning and conclusion in the lead judgment. I also allow the appeal in part and thereby set aside the order for general damages awarded against the Appellant.
I also make no order as to costs.

HAMMA AKAWU BARKA, J.C.A.: My lord Muhammad L. Shuaibu, JCA, gradually obliged me with a copy of the judgment just delivered in draft. Having also studied the record of proceedings and accorded a dispassionate examination of the arguments, I am satisfied that my brother has sufficiently served the areas agitated upon, and I have nothing useful to add.
I also allow the appeal in part and thereby set aside the order for general damages awarded against the appellants. I make no order as to costs.

Appearances:

P. T. NWAFURU For Appellant(s)

CHIDI ANYANWU For Respondent(s)