UNITED BANK FOR AFRICA PLC v. VERTEX AGRO LIMITED (2019)

UNITED BANK FOR AFRICA PLC v. VERTEX AGRO LIMITED

(2019)LCN/13494(CA)

In The Court of Appeal of Nigeria

On Thursday, the 13th day of June, 2019

CA/A/381/2018

JUSTICES

TINUADE AKOMOLAFE-WILSON Justice of The Court of Appeal of Nigeria

EMMANUEL AKOMAYE AGIM Justice of The Court of Appeal of Nigeria

MOHAMMED BABA IDRIS Justice of The Court of Appeal of Nigeria

Between

UNITED BANK FOR AFRICA PLC – Appellant(s)

AND

VERTEX AGRO LTD – Respondent(s)

RATIO

FACTOR FOR AN EXCLUSION OR EXEMPTION CLAUSE T BE ENFORCEABLE

The law is trite that for an exclusion or exemption clause to be enforceable and applicable, the word conveying the exemption must be clear, specific and unambiguous and must exactly cover the liability, which is sought to be excluded. See the case ofHARDWICK GAME FARM v. SUFFOLK AGRICULTURE POULTRY PRODUCERS ASSOCIATION (1968) 3 WLR 110. CHITTY ON CONTRACT 31stEdition Volume 1 Page 1014-1015 paragraph 14-006 succinctly puts it thusly: ?Exclusion clauses must be expressed clearly and without ambiguity or they will be ineffective. The clause must clearly express what its intention is?..Each clause must be considered according to its actual wordings, but it must clearly extend to the exact contingency or loss which has occurred if it is to protect the party relying on it?. A Clause in a contract of sale or hire purchase which merely excludes all conditions and warranties, express or implied, will not necessarily extend to the delivery of goods wholly different from the agreed contract goods.? (underling mine). PER AGIM, J.C.A.

THE PRINCIPLE OF VARIATION OF CONTRACT

In UNITY BANK PLC v. OLATUNJI (2014) LPELR-24027 CA Pg 47 this Court held thusly: ?the principle of variation of contract involves a definite alteration of the contractual obligations by mutual agreement of both parties. Variation is analogous to the entry of a new contract. The requirements of offer, acceptance and consideration are thus imposed. See GOSS v LORD Nugent 110 er 713 at 716, the Court states: for a variation to be upheld, there must be a valid and subsisting contract on the foot between the parties; there must be some consensus between the parties as to the obligations which are to be altered and the parties must have acted in some way to their benefit or detriment in either agreeing the variation or as a result of the variation.” See also Baliol (Nig) Ltd v. Navcon (Nig) Ltd (2010) 16 NWLR Pt. (1220) 633 Para D. PER AGIM, J.C.A.

DAMAGES FOR BREACH OF CONTRACT REMEDIES THE LOSS ARISING FROM THE BREACH

Damages for breach of contract remedy the loss arising from the breach, which loss must be within the reasonable contemplation of the parties to the contract at the time the contract was made or which naturally flows directly from the breach. See Universal Vulcanising (Nig) Ltd v Ijesha United Trading & Transport & Ors (1992) LPELR ? 3415 (SC), Union Beverages Ltd V Owolabi (1988) 1 SC 33, Wahabi v Omonuwa (1976) LPELR ? 3469 (SC) and Machine Umudge & Anor v SBPDC Nig Ltd (1975) LPELR ? 3375 (SC) or 9-11 SC II. So damages cannot be awarded for costs incurred in an action to seek remedy for the loss suffered by a party to a contract as a result of the breach of the contract by the other party to the contract. The cost of litigation is not a loss arising from the breach of contract. This Court in Mbanugo v Nzefili (1997) LPELR ? 5483 (CA) distinguishing between damages and costs held that ?while costs are like damages, awarded as compensation, there is as to costs no restitution in intergum.” PER AGIM, J.C.A.

THE PURPOSE OF AWARD OF COSTS

The purpose for the award of costs is to compensate the successful party for some of the loss incurred in litigation. See Haco Ltd v Brown(1973) 2 SC 14 and Reg. Trustees of Ifejolu v Kuku (1991) 5 NWLR (Pt 189) 65. In Chijioke V Soetan (2006) 10 NWLR (Pt 990) 179, this Court held thusly- ?The emphasis here is the restitution of the party that had succeeded as to the cost he incurred in the litigation, either for prosecuting his claim or defending the action. The decisions referred to by learned respondent?s counsel on this issue, Onabanjo v. Ewetuga (1993) 4 NWLR (Pt.288) 445 and Uzoma v. Okorie (2000) 15 NWLR (Pt. 692) 882 at 893 wherein factors the trial Court should consider in awarding costs have been outlined are apposite. These include:- (a) The summons fees paid; (b) the duration of the case; (c) the number of witnesses called by the party in victory; (d) the vexatious or frivolous nature of the action or defence of the party failed in the litigation; (e) The cost of legal representation; (f) the monetary value at the time of incurring the expenses; and (g) the value and purchasing power of the currency of award at the time of the award. The trial Court in considering the foregoing factors need not explain how it arrived at the sum it eventually awarded as cost. This has been the practice. PER AGIM, J.C.A.

EMMANUEL AKOMAYE AGIM, J.C.A. (Delivering the Leading Judgment): This appeal No. CA/A/381/2018 was commenced on 29-3-2018 when the appellant herein filed a notice of appeal against the judgment of the High Court of Niger State at Suleja delivered on 19-3-2018 in Suit No. NSHC/SD/93M/2016 by Mariya M. Ismaila J.

The notice of appeal contains four grounds of appeal. A second notice of appeal containing 9 grounds of appeal was filed on 30-4-2018.

The appellant in its brief abandoned the first notice filed on 29-3-2018 and adopted the second one filed on 30-4-2018 as the notice of appeal it relies on for this appeal. The first notice of appeal filed on 29-3-2018 having been abandoned is hereby struck out.

A notice of cross appeal dated 9-4-2018 was filed on 20-4-2018.

The briefs filed, exchanged and adopted in the appeal and cross appeal are as follows- Appellant?s brief, respondent?s brief, appellant?s reply brief, cross appellant?s brief, cross respondent?s brief, and cross appellant?s reply brief.

?The respondent?s brief and cross appellant?s brief are contained in one

document. Equally the appellant?s reply brief and cross respondent?s brief are together in one document titled appellant?s reply brief.

The appellant?s brief raised the following issues for determination:-

1. Whether the Appellant breached its duty of care to the Respondent and were negligent in dealing with the Respondent?s account. (Distilled from grounds 1, 2 and 3).

2. Whether the exemption clauses embodied in the contract protected the Appellant from the alleged loss suffered by the Appellant. (Distilled from grounds 4 and 5)

3. Whether Exhibit F a letter dated 22/11/2016 written as a reply to letter of demand Exhibit D, in the circumstances of this case, was written in contemplation of this suit and therefore inadmissible in evidence in virtue of Section 83(3) of Evidence Act and was justifiably expunged from the record. (Distilled from ground 6).

4. Whether the Respondent is entitled to judgment, in view of the evidence before the Court and in particular to the award of N1,000,000.00 (One Million Naira) and N500,000.00 (Five Hundred Thousand Naira) as damages for attorney?s fees and damages for

dishonoured cheques respectively. (Distilled from grounds 7, 8 and 9).

The respondent?s brief adopted the four issues raised for determination in the appellant?s brief.

I will determine this appeal on the basis of the issues raised for determination in the appellant?s brief.

Let me start with issue No. 1.

The respondent by its pleadings and evidence established that the appellant and the respondent had a banker customer relationship under which the respondent maintained current number 1012174723 with the appellant, that at the close of business activities on 21-10-2016, the respondent had the sum of N43,632,923.11 standing to its credit in its said current account with the appellant and that-

?On or about the 21st day of October, 2016 at about 5:00pm after close of business, the plaintiff through its Managing Director received various SMS alerts on his Cell Phone with MTN Phone Number: 08036186987 (being the only registered number with the defendant) of unauthorized debits to the tone of N9,293,578.15 (Nine Million, Two Hundred and Ninety Three Thousand, Five Hundred and Seventy Eight Naira, Fifteen Kobo) Only

purporting to be transactions effected through the defendant?s online banking platform as set out below:-

a. N2,150,131.25 transferred to Access Bank account number: 0059561095 with account name Ihuoma Anselem Chiemela.

b. N1,150,000.00 transferred to UBA account number: 2085899108 with account name Mezue Austin Raymond

c. N1,150,000.00 transferred to UBA account number: 2085899108 with account Mezue Austin Raymond

d. N1,150,000.00 transferred to UBA account number: 2085899108 with account name Mezue Austin Raymond.

e. N510,181.25 transferred to Skye Bank account number: 1771368334 with account name Sunej Global Ventures Ltd.

f. N1,150,131.25 transferred to Zenith Bank account number: 2006977964 with account name Chikezie Chikwuebuka Iwuoh.

g. N1,150,000.00 transferred to UBA account number: 2059427014 with account name Nwojbara Ijike

h. N482,042.15 transferred to Diamond Bank account number: 0083232571 with account name Sunej Global Ventures Ltd.?

Concerning these unauthorised debits, the respondent averred in paragraphs 9 to 22 of its amended statement of claim thusly-

?9. The Plaintiff

avers that the said transaction highlighted above were never authorized nether are the recipients known to the plaintiff.

10. The Plaintiff further avers that he has never all through his banking relationship utilized the defendant?s online banking platform to facilitate any transaction.

11. The plaintiff avers that sequel to the surprising receipt of the unauthorized transactions he immediate informed his head of Administration and finance, one Mr Hensley Samuel, who immediately caused a complaint via phone conversation and SMS to the plaintiff?s account officer with the defendant of this development on or about 6pm on Friday the 21st of October, 2016.

12. The plaintiff further avers that the Managing Director of the plaintiff Mr. Daniel Gemana equally informed the account officer and the branch Manager of the defendant?s Suleja branch on the same 21st day of October, 2016.

13. The plaintiff avers that on the 24th of October, 2016, the Plaintiff through its Managing Director, wrote a letter to the Business Manager of the Defendant?s Suleja branch requesting the Defendant to immediately reveres the unknown debits back

to the plaintiff?s account. The Plaintiff?s letter dated the 24th day of October, 2016 is hereby pleaded.

14. The plaintiff avers that on the 24th day of October, 2016 the plaintiff through its Head of Administration One Mr Hensley Samuel made a formal complaint to the Divisional Police Headquarters, ?B? Division, Suleja, within the jurisdiction of this Court, about the unauthorized debits from their UBA account.

15. Sequel to the afore-stated fact in paragraph 14 above, the Divisional Police Offer informed the plaintiff that it is civil transaction of banker-customer relationship and caused a letter to the Suleja Branch Manager of the plaintiff?s bank requesting the Defendant to reverse the monies withdrawn without requisite authority back to the Plaintiff?s account. The letter from the Division Police Officer dated the 26th day of October, 2016 is hereby pleaded.

16. The plaintiff avers that on the 10th day of November, 2016 the plaintiff issued a Cheque for the transfer of the sum of N8,000,000.00 (Eight Million Naira) only being less than the total of monies belonging to the plaintiff?s deposited in

the defendant?s custody as monies had and received as at the 10th day of November, 2016 but the said instrument was dishonoured by the defendant thereby depriving them of access to their funds. The Plaintiff?s UBA Cheque leaf with Cheque number 27412127 is hereby pleaded.

17. The plaintiff avers that its relationship with the defendant is fiduciary in nature and the defendant owes it a duty of care.

18. The plaintiff avers that its deposit with the defendant constitutes a debt recoverable immediately upon demand.

19. The plaintiff avers that the defendant failed, refused and or neglected to exercise his duty of care by protecting its deposits and releasing same upon demand.

20. The plaintiff avers that it is entitled to assess its funds anytime it wishes sequent on their contractual banking relationship.

21. The plaintiff avers that the defendant refused to release the plaintiff?s funds after several demands via telephone conversation and other interventions.

22. The plaintiff avers that the defendant?s action or inaction have caused it severe lost of business, immeasurable damages and serious reputation

issues.

26. The plaintiff avers that these unauthorized withdrawal is completely out of negligence of the defendant.

PARTICULARS OF NEGLIGENCE

I. That the plaintiff through its Managing Director, Mr. Daniel Gemana had never login on the defendant?s online banking platform since it was created through which the purported and/or unauthorized withdrawals were effected.

II. That the plaintiff had never utilized the hardware token device issued to it by the defendant through which the unauthorized and/or purported transaction was effected.

III. That the plaintiff?s hardware token device is still with it and no third party had access to it.

IV. That the plaintiff through its managing Directors Mr. Daniel Gemana never received any One Time Pin (OTP) SMS on the Hardware Token device or on its designated Phone Number, 08036186987 for the unauthorized transaction pleaded above.

V. That the plaintiff Managing Director never received any email with respect of the unauthorized transaction pleaded above.

VI. That the defendant action or inaction occasioned the infiltration of the plaintiff?s account in its

custody.

VII. That the defendant has a duty of care to protect its customer?s deposit and/or transaction either through its online platform or any other banking platform it creates.

VIII. That the defendant failed, refused and or neglected to exercise that duty of care by protecting its online banking platform from third party infiltration that occasion the unauthorized withdrawal from the plaintiff?s account.

IX. That the plaintiff?s loss and damages are as a result of the defendant?s action or inaction which has occasioned a great loss to the plaintiff.?

The respondent by the testimonies of the four witnesses it called and documentary exhibits A to N, 01, 02, 03, Q1 ? Q206 established the facts in its amended statement of claim and thereby established the case presented by it in its statement of claim.

The respondent having established the case in its amended statement of claim, the evidential burden then shifted to the appellant to rebut the case presented by the respondent by showing that it is not responsible for the loss or unauthorised withdrawal of respondent?s N9,293,578.15 in its custody. ?

This burden arises by virtue of S.133(1) and (2) of the Evidence Act which provides that-

?(1) In civil cases, the burden of first proving existence or non-existence of a fact lies on the party against whom the judgment of the Court would be given if no evidence were produced on either side, regard being had to any presumption that may arise on the pleadings.

(2) If the party referred to in Subsection (1) of this section adduces evidence which ought reasonably to satisfy the Court that the fact sought to be proved is established, the burden lies on the party against whom judgment would be given if no more evidence were adduced, and so on successively, until all the issues in the pleadings have been dealt with.?

Let me now consider if the appellant discharged this burden in its statement of defence and the evidence it led through its witnesses.

The appellant averred in paragraphs 4 to 14 of its statement of defence thusly-

?4. In July, 2013 the Managing Director of the plaintiff requested for a token and token device with serial number 0893xx3805 was issued to the Managing Director. The token was

linked to the U-Direct profile VERTEXAGRO.DANIEL (the only profile on the plaintiff?s account at that time).

5. The defendant states that a review of its token log confirmed that this token was never used by the plaintiff.

6. On the 10th December, 2015, the plaintiff requested for a transfer menu access to make payments via NIBSS instant payment options. The request was authorized by the Managing Director and Secretary of the Plaintiff.

7. The request included an indemnity in which the Managing Director and Secretary of the plaintiff stated that the defendant would not be liable for any losses incurred from transactions carried out on the plaintiff?s account while using the platform. Defendant pleads and shall rely on the following:

i. REQUEST FORM

ii. U-DIRECT TOKEN ACTIVATION

iii. U-DIRECT PIN RE-ISSUANCE

iv. INDEMNITY FORM

v. TOKEN APPLICATION/REPLACEMENT FORM

8. In March, 2016, the Managing Director of the Plaintiff, Daniel Gemana requested that view access to the plaintiff?s corporate account via U-Direct be granted to Hensley Samuel who was introduced as the plaintiff?s Group Finance

Manager. Hensley Samuel?s platform was subsequently created on March 9, 2016 with ID-VERTEXAGRO.SAMUEL

9. The said Hensley Samuel completed VITUAL CHANNEL ENROLMENT FORM-Individual, dated 02/02/16 and letter of introduction are hereby pleaded and shall be relied upon at the trial.

10. The defendant shall contend at the trial that the plaintiff Managing Director, Daniel Gemana compromised his e-mail profile which gave the perpetrators of the fraud access to his e-mail where they accessed the U-token activation OTP and password either through physical access or social engineering.

11. The defendant states that upon the receipt of the plaintiff complaint repudiating the 9th (ninth) transfer transactions debited in the Plaintiff?s account on 21st October, 2016 via the U-Direct banking planting in the total sum of N9,293,578.15 into various banks.

12. The defendant made a follow up with the various banks and a total sum of N4,692,097.00 (Four Million Six Hundred and Ninety-Two Thousand Ninety-Seven Naira only) was salvaged. This sum will be credited into the plaintiff?s account as soon as the return process is concluded.

13. In specific response to paragraph 26(I-IX) the defendant emphatically denies that it was not negligent in the management and running of the plaintiff?s account and will not be in the position to refund the total amount of money withdrawn from the plaintiff?s account as the transactions were made possible due to the compromise of the plaintiff?s U-Direct access credentials by the plaintiff.

a. The plaintiff through its Managing Director Gemana successfully logged into the U-Direct platform with the correct credentials after he has correctly answered the security questions previously set up by himself and subsequently authorized transactions on the account.

b. The Managing Director on behalf of the plaintiff utilized the hardware token device linked to the plaintiff?s account that is/was always in the plaintiff?s custody.

c. The soft U-token/hard token is always in the custody of the plaintiff.

d. The U-Direct audit logs revealed that the repudiated transactions were initiated with User ID: VERTEXAGRO.DANIEL belonging to the plaintiff?s Managing Director.

e. After successfully supplying the User

ID: VERTEXAGRO.DANIEL belonging to the plaintiff?s Managing Director.

f. A password reset was sent to the registered e-mail address: danielgemana@yahoo.com

g. The defendant was diligent in maintaining the plaintiff?s account but rather the fraud was perpetrated through the plaintiff?s alter ego?s negligence.

h. The defendant within the extant law and banking practice have been diligent with the account of its numerous customers, the plaintiff inclusive.

i. The Managing Director failed, neglected and refused to respond to the SMS sent to him by the defendant on the 17 October, 2016 until the 21st October, 2016 when the fraud had been perpetrated.

14. By letter Reference Number: CCM1610218210 dated 22nd November, 2016, written by the defendant and addressed to the plaintiff, the defendant stated in detail the circumstances surrounding the fraud and the step it has taken so far to salvage the plaintiff?s fund in compliance with the best banking practice. The plaintiff is hereby put on notice to produce the original copy of the said letter at the trial.?

The appellant elicited evidence through one

witness in support of its statement of defence.

The appellant admitted the loss or unauthorised withdrawal of N9,293,578.15 in its custody in the respondent?s current account with it. It also admitted that the hardware token device with serial number 0893xx3805 it issued to the respondent?s Managing Director and which was linked to the respondents internet bank platform (U-Direct) with the appellant was never used by the respondent to withdraw any money from its said current account. DW1 testified that the withdrawals were made using a software token and not Exhibit G, the hardware token appellant had issued to the respondent.

Inspite of these admissions, the appellant asserted that the respondent?s Managing Director compromised his e-mail platform, which gave the perpetrators of the fraud access to his email and thereby gained access to the U-token activation, QTP and password either through physical access or social engineering and that it was not negligent in the management and running of the respondent?s account and will not be in the position to refund the total amount of money withdrawn from the respondent?s

account as the transactions were made possible due to the compromise of the respondent?s U-direct access credentials by the respondent?s Managing Director.

The appellant did not in its pleadings and evidence show or even suggest why it concludes that the loss or unauthorised withdrawal of money from the respondent?s account with it was due to the negligent handling of the respondent?s U-direct (internet banking) platform details by its Managing Director and did not show or suggest the particulars of the alleged negligence of the Managing Director of the respondent. The appellant failed to prove its assertion that the respondent?s U-direct token activation OTP and password was accessed by the fraudsters either through physical access or social engineering and failed to prove that they used that access to make the unauthorised withdrawals from the respondent?s account with the appellant. Its pleadings and evidence on how the unauthorised withdrawals were made from the respondent?s account with it is speculative.

DW1 testified under cross examination that the unauthorised withdrawals were made by a software

token and not the hardware token device issued to the respondent?s Managing Director by the appellant. DW1 testified confirming the pleading in paragraph 8 of the statement of defence that a review of the said hardware token issued to the respondent?s Managing Director showed that the token was never used by the respondent.

DW1 also testified that they have been prior attempts to make unauthorised withdrawals from the respondent?s account and that the appellant reported those attempts to the appropriate authority, but he did not have the report in Court.

DW1 further testified that the appellant laid a criminal complaint to the police which resulted in the arrest of one Ejike Nwabara. The appellant did not show or suggest in its pleadings and evidence what it said in its criminal complaint to the police that led to the arrest of Ejike Nwabara.

The appellant did not elicit any evidence to challenge or contradict the evidence of PWIII, John Agwanyan, the Inspector of Police who investigated the complaint of the appellant against Ejike Nwabara. The said testimony of the Inspector of Police reads thusly-

?My names are

Insp. John Agwanyan. I reside in Enugu State. I am a police officer. I am inspector of police and attached to Ikirike Division Edo River as Inspector crime Enugu state. I am here a result of subpoena served on me by this Court. I have a photocopy of the subpoena. The original is at the IGP?s Police. Here is the subpoena.

M.J Numa: My lord I have see the copy of the subpoena however it not properly certified. In view of this we seek to tender it as an I.D so as to enable the defendant?s counsel use it for cross examining. However at the next adjourned date we will tender the certified copy before the Court through the bar. I have conferred with any learned counsel he is not object to the application.

Oluwole Esq: No objection.

Court: The photocopy of the subpoena is hereby marked as I.D.I.

PWIII: I do know the defendant in this case. The defendant is the UBA that have branches all over the nation including Enugu where I reside.

On 31st October, 2016, the security man attached to the Bank (UBA) with 2 Mobile Policemen brought a suspect to our office reporting that the suspect Mr. Nwabara Ejike is a wanted person and he is

involved on internet fraud in an account domicile UBA. Later it was revealed that the account belongs to the plaintiff. On 1st November, 2016 UBA brought a letter addressed to my DPO that they need our co-operation to continue with the case. I brought the suspect out and interrogated him and he voluntarily reduced his statement into writing under words of caution.

M. J Numa: In our statement of claim, we pleaded the police case file we will be subpoenaed.

PWIII: I have a copy of the statement of the suspect. It is a photocopy. The original is at the office in Enugu. I have a photocopy of the letter written by the Bank. The original is with the DPO?s office.

M. J Numa: My lord we have the photocopies of the documents and we seek to tender them for ID Purposes. The 1st letter is dated 1st November, 2016 a letter from the defendant UBA to DPO. The 2nd is a statement by the suspect Nwabara Ejike dated 1st November, 2016. That the next adjourned date we shall tender the certified true copy.

Olowole Esq: No objection.

Court: The letter from UBA and the one statement of the suspect are hereby marked as ID II & III respectively.

PWIII: In the cause of our investigation, the suspect didn?t disclose his relationship with the plaintiff. Rather he said he does not know the plaintiff. The suspect disclosed that he had an account with UBA. After the letter we invited the defendant to come and give us information to carry on with the investigation and to get other culprits. We waited we didn?t see any person and when we called UBA, they directed us to the plaintiff. The UBA sent us the number of the plaintiff and I called the plaintiff. The plaintiff told me that it is the right of the bank (UBA) to furnish me with any information to carry on with the investigation. I waited almost 2 weeks (11 days) for the UBA to come and give me information to proceed but they filed to come. The suspect was in the cell from 31st October to 10th November, 2016 then he was granted bail. UBA never made any statement to the police. The suspect was never arraigned in Court. He was not arraigned in Court because of insufficient evidence. That is all my lord.?

This testimony of the Police officer remained unchallenged and uncontradicted by the appellant. By not contradicting or denying

this testimony, the appellant admitted it as true and correct. It is settled law that such unchallenged and uncontradicted evidence must be accepted by the Court and acted upon as the proof of the facts it narrates. See Okoebor V Police Council & Ors (2003) 5 SC 11 in which the Supreme Court held that ?Where evidence given by a party to any proceedings was not challenged by the opposite party, who, like in the instant case, had the opportunity to do so, it is always open to the Court seised of the matter to act on such unchallenged evidence before it.?

The appellant did not elicit any evidence to explain why it took Ejike Nwabara and handed him over to the police as the perpetrator of the fraud and why it refused to co-operate with the police to investigate the matter conclusively, and, if need be, prosecute the suspect it took to the police. The obvious and necessary implication of the appellant arresting Ejike Mwabara and taking him to the police as the perpetrator of the fraud is that they knew how the fraud was committed and that he did it. Yet the appellant?s officers refused to make a statement to the police concerning the

matter and refused to help the police investigate the matter. The police were forced to release the said Nwabara Ejike on bail as they could not continue to detain him without investigation and trial.

The pleading and evidence of the appellant failed to show how and why the money was withdrawn or removed from the respondent?s current account without the prior knowledge and authorization of the respondent. The oral testimony of DW1 that the appellant made reports to the relevant authorities of earlier attempts of unauthorized withdrawals from this said respondent?s current account with the appellant was not proven by any evidence of such reports. There is no explanation why the reports were not tendered in evidence. DW1 merely said that he did not have the report before the Court. As it is, there is no evidence that the appellant reported such attempts to the relevant authorities and the respondent, the owner of the account. It is obvious that if such a report had been made to the relevant authorities and the respondent, the fraud would have been prevented.

The appellant?s evidence failed to explain why, with knowledge of previous

attempts to fraudulently withdraw money from the respondent?s account, it allowed the said withdrawals without ensuring that the withdrawals were being made by the Managing Director of the respondent using its Know Your Customer documented processes. DW1 testified that the know Your Customer process is documented. The appellant failed to explain why the process was not followed considering the existing attempts to make such withdrawals. The trial Court was right when it held that ?considering the generality of evidence led in this matter in deciding the issue at hand, I cannot but come to the following conclusions:

1. That in the course of carrying out its general banking duties which have been made more stringent with the advent of Internet Banking, the Defendant were required to maintain a profile/data of its customers or users of its services as per the Know Your Customer (KYC) policy. See the Central Bank Guidelines on Electronic Banking in Nigeria 2003 made pursuant to the Central Bank of Nigeria (Establishment) Act…

2. The Defendant at some point became aware of unidentified attempts at logging into the banking

platform subscribed to by the Plaintiff.

3. The Defendant failed to report to the relevant authorities as mandated by the Central Bank Guidelines on Electronic Banking in Nigeria 2003 (subsequently referred to in this judgment as ?the guidelines?). At least, there was nothing before this court to the contrary.?

The appellant did not elicit any evidence to challenge or contradict the evidence of PWIV, Kingsley Ehiaba, a fraud analyst with MTN, Nigeria Communications Ltd, who testified as a subpoenaed witness that-

?PWIV: My lord I can identify the no. with prefix 08036186987 as an MTN no. my lord I am here with call records (voice) and SMS records of the plaintiff?s no. domicile with the defendant?s bank. The documents were produced from 1st Oct. 2016 to 30th Nov. 2016. The documents contain both SMS and voice transactions of the telephone no. 08036186987 belonging to Mr. Daniel Gemana.

PWIV: At Exhibit Q51, the high cited column 9 in numbers are the SMS received on 21st Oct. 2016 by telephone no 08036186987. My lord from the call as it appears on the exhibit, I cannot identify it to a particular sender

reason being that the number appearing on this document as the sender of this SMS is the SMSC and this means short message service number. The number is used by network to carry SMS from network to the customers or from the customer to the network. My lord from experience the SMS sender?s no is not indicated if there is a delay from SMS to get to the customer the system captures it as the SMSC number that appear in this document Q.51. In this instance, I am of the view that the customer?s number i.e. 08036186987 was taken off the data base of the bank as at when the transaction was done so when it is taken back to the data base, the network then generates the SMS Number as against the sender?s identification.

My Lord, I have worked in a similar situation before. For example last year in 2016 in one of the commercial banks which at then newly deployed their short code for mobile banking. What the bank did was to check the numbers of the bank customers who has never used the short code before and from the bank and of system they were able to use the default password to carry out banking transaction and over one hundred and eighty customers

suffered financial lost due to this. The bankers involved in this were finally arrested in March 2017.

My lord this kind of scenario as described there is a possibility that the SMS was not delivered at real time (that is not delivered when the transaction was done). I have checked the possibility of sim Swap and none was found.

My Lord I can say that only 9 SMS was received on 21st Oct. 2016 on this no. i.e 08036186987. That is all my lord.?

The appellant did not challenge or contradict the expert opinion evidence of the PWIV that the respondent?s mobile phone No. 08036186987 was taken off the data base of the bank at the time the transaction was done to avoid the identification of the person making the withdrawal and to avoid detection of the transaction at the time it was taking placed. His evidence on how this was done is not contradicted. He explained that when the customers phone number is taken off the bank?s data base at the time of the transaction, when it is restored to the data base after the transaction, the network generates the short message service (SMS) number instead of the number of the person carrying out

the transaction and this accounts for why Exhibit Q51 shows only SMSC numbers instead of the number of the person who made the withdrawals of 21-10-2016. PWIV also gave similar fact evidence of how the customers of another bank were defrauded by this method and bank officials were arrested in March 2017. The evidence of PW4 remained unchallenged and uncontradicted. By not challenging or contradicting that evidence, the appellant admitted it as true and correct. Complicity of the staff of the appellant can be reasonably inferred from this unchallenged evidence of PW4, especially against the background of the inability of the appellant to explain who made the unauthorised withdrawals and how it was made and the refusal of the appellant?s officers to make a statement to the police concerning the matter and their refusal to help the police investigate the matter of their criminal complaint against Ejike Nwabara, whom they arrested and took to the Police station and had detained for long without investigation and trial.

Only persons that have access to a bank’s data base can take off a number from it and restore it later to avoid detection of such

unauthorised withdrawals and the identity of the person that did it. It is obvious that only the appellant?s staff can have such access.

In the light of the foregoing, I uphold the decision of the trial Court that the appellant was negligent in the maintenance of the respondent?s current account with it. It clearly breached its duty of care to the respondent to ensure that the respondent?s monies in its custody and control were safe and secure with it. It negligently allowed the unauthorized withdrawal of the respondent?s money in its custody. The appellant failed to rebut the case established by the respondent.

Issue No.1 is resolved in favour of the respondent.

Let me now determine issue No. 2 which asks ?Whether the exemption clauses embodied in the contract protected the Appellant from the alleged loss suffered by the Appellant.?

I have carefully read and considered the arguments in all the briefs on this issue.

The part of the judgment of the trial Court complained against under this issue reads thusly-

?Defendant?s position is that the Plaintiff entered into an indemnity

agreement which indemnified it of any loss or injury occasioned by the use of any of its internet banking platforms as evidenced by Exhibit L herein. Exhibit L provides in its commencement that:

WHEREAS:

1. I/We maintain account(s) with United Bank for Africa Plc {my/our Account(s)}.

2. I/We use/desire to use the various electronic payment options offered to your customers including but not limited to NIBSS Instant Payment (NIP) system for transactions on my/our Account(s).

3. I/We want to be able to effect electronic payments by means of the NIP System and other payment options and UBA has requested that i/we indemnify it for any loss that may arise from my/our use of the electronic payment options.

Learned Counsel for the Defendant therefore argued that the said Exhibit B made in 10th December, 2015 therefore excluded Defendant?s liability in the previous agreement entered into between the Plaintiff and Defendant as evidenced by Exhibit H (U-Direct Token Activation Request Form) made in 2008. Exhibit K (which is the UBA Virtual Enrolment Form) on the other hand was signed in the year 2016.

It is the submission of learned

counsel for the plaintiff however that Exhibit L was made subsequent to and after the signing of Exhibit H which was document subscribing the Plaintiff to the U-Direct Internet Banking Platform.

Learned Counsel for the plaintiff argued that the said indemnity did not therefore incorporate the earlier agreement of 2008, evidenced by Exhibit H. Counsel also maintained that Exhibit F was in direct conflict with the CBN Guidelines on Electronic Banking of Nigeria which was made in pursuant to the Act establishing the Central Bank of Nigeria which is the regulatory authority over banking business in the country. Learned counsel further resubmitted that the unauthorized withdrawals having not been done through the Hard Token (Exhibit G) given to the plaintiff pursuant to Exhibit H the U-Direct Token Activation Form, but through a software or a platform unknown different from the one subscribed to by the plaintiff, the Defendant cannot therefore have recourse to the provisions of Exhibit L. I am persuaded by the dictates of the law with regards to the evidence led in this case to agree with the submissions of learned counsel for the plaintiff. The Defendant

cannot have recourse to any exemption clause, or indemnity in Exhibits K, L and M for the following reasons;

1. In interpreting exemption clauses such as the one relied upon by the Defendant in this case, the Courts are generally hostile to exclusion clauses as they must be strictly proven and shown to cover the liability complained of. I am not convinced that the indemnity ?in Exhibit L successfully incorporated the agreement in Exhibit H which is the foundation for Defendant?s claim that the plaintiff?s login details were fraudulently accessed through either physical access to PW1?s mobile phone or through social engineering. There is no direct or positive reference to the agreement in Exhibit H or any other agreement by the wordings of Exhibit L. The cases of Chevron Nig. Ltd. vs Titan Energy Ltd. (2013) LPELR-2102 (CA) 37-38 and FBN PLC vs. Associated Motors Co. Ltd (1998) 10 NWLR (pt. 570) p.441 at 461-463 paras. H-A is very instructive on this point. Thus, in the preamble of Exhibit L, the commencing paragraph 3 stating ?I/We want to be able to effect electronic payments by means of the NIP system and other payment

options and UBA has requested that I/We indemnify if for any loss that may arise from my/our use of the electronic payment options?. {underline supplied} cannot be interpreted as extending to indemnify the Defendant for all and by electronic banking packages subscribed to by the plaintiffs.

2. Similarly, it was not in contention among both parties that the plaintiffs account was accessed through another different platform activated by a soft token separate from Exhibit G tied to the U-Direct Platform subscribed to by the bank. Not being able to show that the exemption clauses as well as Exhibit L relied upon by the Defendant also incorporated the unknown platform used by the perpetrators of the fraud complained against, the Defendant cannot take shelter in the protection of these exemption clauses or Exhibit L.

3. Also, having held as in the earlier part of this judgment that the defendant are liable in negligence in carrying out their duties with respect to the plaintiff?s monies in their custody, the same defendants cannot be protected by an exemption/indemnity clause or agreement for their negligent act as held above. For the law is

trite that a party who is liable for negligence in its contractual duties cannot be protected from culpability by exemption/indemnity clauses as sought to be done in this case. See the cases of U.B.N. Plc. vs. Omni products (Nig) Ltd (2006) 15 NWLR (Pt. 1003) p.660.

4. Finally, I am also in agreement with learned counsel for the plaintiff that the tenor and nature of exemption/indemnity relied upon by the Defendant in this case is against the general and particular provisions of the Guidelines on Electronic Banking in Nigeria 2003 made pursuant to the Central Bank of Nigeria (Establishment) Act? which is generally tailored to protect end users of electronic or internet banking having in mind the complexity and fragility of that area of banking. See Chevron Nig. Ltd. vs. Titan Energy Ltd (supra).

From the foregoing, issue two I also resolved in the plaintiff?s favour.?

Learned counsel for the appellant has argued that the trial Court was wrong to have decided that the indemnity in Exhibits K, L and M cannot be relied on by the appellant to avoid liability for the losses suffered by the respondent due to the

unauthorised withdrawal of its monies in the custody of the appellant. Exhibit L dated 10-12-2014 reads thusly-

?INDEMNITY

WHEREAS:

1. I/we maintain account(s) with United Bank for Africa Plc {my/your Account(s)}

2. I/we use/desire to use the various electronic payment options offered to your customers including but not limited to NIBSS Instant Payment (NIP) system for transactions on my/our account(s)

3. I/we want to be able to effect electronic payments by means of the NIP system and other payment options and UBA has ?. That indemnify it for any loss that may arise from my/our use of the electronic payment options.

NOW, in consideration of UNITED BANK FOR AFRICA PLC agreeing to allow me/us carry out electronic payments on NIBSS instant Payment (NIP) System and/or other electronic payment options, THE Electronic Payment Transactions) on my/our Account(s) I/wehereby:

1. Declare and confirm that I/we am/are liable for

all transactions carried out on my/our Account(s) using my/our passwords/tokens of any other confidential details on the NIP System or any other electronic payment option and undertake to indemnify you and keep you indemnified against any damages costs and expenses whatsoever including all legal costs charges and other expenses you may incur by reason of your allowing me/us to carry out the Electronic Payment Transactions.

2. I/we agree that you may at any time without notice to me/us set off or transfer any sum or sums standing to the credit of any one or more of my/our accounts with you in or towards the satisfaction of my/our liabilities to you arising out of your allowing me/us to carry out the Electronic Payments Transactions.

3. I/we agree that if I/we fail to pay on demand any sums payable hereunder, that interest shall accrue thereon from the date of such demand until judgment and full liquidation at your Prime Lending Rate.

4. I/we agree that no delay or omission or granting of any indulgence on your part in exercising any right power, privilege or remedy in respect of this indemnity shall be construed as a waiver thereof nor shall any

single or partial exercise of any other right, power, privilege or remedy preclude any further exercise of any right, power, privilege or remedy. The rights, powers, privileges or remedies provided in… this indemnity are cumulative and not exclusive of any rights, powers, privileges or remedies provided by the law.?

Clauses 2 and 3 of Exhibit K reads thusly-

?2. UBA will not be held liable for non-delivery or delay delivery of alerts, e-mails, errors or losses or distortion in transmission of alerts and e-mails to the USER; UBA shall not be liable for lack of receipt of alerts due to technical defects on customer?s phone or computer or damage or loss incurred by the USERS as a result of caus not directly attributable to UBA.

3. UBA shall not be liable to the user, or to any third party for any drawing, transfer, remittance, disclosure or any activity, or incidence on the user?s account, whether authorized by the user or not, PROVIDED that such drawing, transfer, remittance, disclosure, or any activity or incidence was authorized or made possible by the fact of the knowledge and/or use, or manipulation of the

user?s password, or otherwise by the user?s negligence. User acknowledges that his password shall be known and kept secret at all times.?

It is clear from the express wordings of Exhibit L that the indemnity covers only transactions in which the respondent?s password or token or other confidential detail is used. It is also clear from the express words of the proviso in the disclaimer in Exhibit K that the disclaimer applies only to such drawing, transfer remittance, disclosure, or any activity or incidence that was authorized or made possible by the fact of the knowledge or use or manipulation of the user?s password or otherwise by the user?s negligence. It is admitted by the appellant that Exhibit G (the hardware token issued by it to the respondent and linked to the internet banking platform) was not used to make the unauthorised withdrawals. I have already held herein that there is no evidence of how the unauthorised withdrawals were made and that there is no evidence that the password or any confidential details of the respondent was used in making the unauthorised withdrawals. The appellant?s witness, a

staff of the appellant, testified that the withdrawals were made by means of a software token and not Exhibit G, the hardware token issued to the respondent. The trial Court rightly held that ?it was not in contention among both parties that the plaintiffs account was accessed through another different platform activated by a soft token separate from Exhibit G tied to the U-Direct Platform subscribed to by the bank. Not being able to show that the exemption clauses as well as Exhibit L relied upon by the Defendant also incorporated the unknown platform used by the perpetrators of the fraud complained against, the Defendant cannot take shelter in the protection of these exemption clauses or Exhibit L.?

The indemnity by its wordings does not cover the liability of the appellant to refund monies belonging to the respondent, which monies were withdrawn without the respondent?s knowledge and authority from its account in the custody of the appellant. The liabilities covered by the indemnity are specifically listed therein as follows- damages, cost, expenses including all legal costs, charges and other expenses incurred by reason of the

appellant allowing the respondent carryout the Electronic payment transaction. The liabilities referred to here are the expenses and costs of operating and maintaining the electronic payment facilities for use by the respondent.

The indemnity does not relieve the bank from liability for unauthorised withdrawals or dealings with customers funds or for breach of its duty to manage and maintain the customer?s account, protecting and securing the customers funds therein with due care and diligence. The law is trite that for an exclusion or exemption clause to be enforceable and applicable, the word conveying the exemption must be clear, specific and unambiguous and must exactly cover the liability, which is sought to be excluded. See the case ofHARDWICK GAME FARM v. SUFFOLK AGRICULTURE POULTRY PRODUCERS ASSOCIATION (1968) 3 WLR 110. CHITTY ON CONTRACT 31stEdition Volume 1 Page 1014-1015 paragraph 14-006 succinctly puts it thusly: ?Exclusion clauses must be expressed clearly and without ambiguity or they will be ineffective. The clause must clearly express what its intention is?..Each clause must be considered according to its actual

wordings, but it must clearly extend to the exact contingency or loss which has occurred if it is to protect the party relying on it?. A Clause in a contract of sale or hire purchase which merely excludes all conditions and warranties, express or implied, will not necessarily extend to the delivery of goods wholly different from the agreed contract goods.? (underling mine)

A close reading of Exhibit L shows that it made general reference to any other electronic payment option. This general use of the word any other electronic payment cannot be effective enough to avail the appellant the protection to evade liability. In ALISON (J Gordon) Ltd v. WALLSEND SHIPWAY & ENGINEERING CO., LTD (1927) 43 TLR 322, 324, Scrutton L.J said- ?If a person is under a legal liability and wishes to get rid of it, he can only do so by using clear words.”

Exclusion clauses are inapplicable in cases of fundamental breach in contract and tort. So the appellant cannot rely on an exclusion clause to avoid liability for the loss its negligence has caused the respondent. In BROADLINE ENT. LTD v MONETEREY MARITIME CORP (1995) 9 NWLR Pt. 417 pg 1

at 29 more profoundly thus-

?in the circumstance, the exclusionary term in the receipt given by the appellants to the respondent on the contract of carriage between the parties would not exculpate the appellants from liability for the loss of the respondent?s money?.. so long as the claim, as in the present action, is not properly framed and worded, bailor do not escape liability unless they establish that the loss occurred in some way not involving their negligence and they would be liable if they adduce no satisfactory explanation of how the loss occurred. See Woolmer V. D Price Ltd (1955) 1 ALL E.R 377? (underlining mine).

In FBN PLC v. ASSOCIATED MOTORS CO. LTD (1998) 10 NWLR (570) at 441 page 462 para A-B thus:

?so going by the First rule of construction, it is said that mere general words in an exemption clause do not ordinarily absolve the party seeking to rely on the exemption from liability for his negligence or that of his employees. See London & North Western Railway v Neilson (1922) 2 A.C. 263 at 266. ?thus where barge owners excluded liability ?for any loss of or damages cover loss or

damage due to their negligence.? (underline mine).

A very important aspect of the contra profenrentum rule is that very clear words must be used before a party will be held exempted from liability in Negligence. The use of general terms like ?any loss; will not be liable for any damages however caused? such as in this instant case will not suffice. The indemnity which was with reference of NIPPS and any other electronic banking subscribed to be the respondent can certainly not be inferred to include products not subscribed to; in this case, the Software token to cover negligence in this con.

Exhibit H is the foundation of the online/internet banking relationship between the parties entered into in 2008 specifically with respect of U-Direct Platform, which is an online or internet banking platform distinct from both Exhibit L & K. Exhibit H does not contain any indemnity. The subsequent agreements which contained the purported indemnities did not expressly or remotely mention Exhibit H. From the totality of the pleaded facts and the evidence before the Court, the respondent simply demonstrated that the indemnity which is an

exclusion clause, the appellant is relying on to exculpate itself from liability were not incorporated in the agreement giving rise to the present cause of action which is Exhibit H. DW1?s testimony was direct and unequivocal. He also confirmed that the Hardware token- Exhibit G was never utilized by the plaintiff. Exhibit L which is an indemnity with respect of NIPPS executed in 2015, 7 years after the online banking relationship ensued, did not incorporate Exhibit H executed in 2008 expressly by reference hence cannot fall with within its contemplation. If the appellant intended the indemnity to bind Exhibit H which was founded on the online banking, it would have expressly mentioned same in Exhibit L or EXHIBIT K after all it is an asymmetric contract drafted by the appellant and shown to the respondent to sign. See YARO v. AREWA CONSTRUCTION LTD (2007) 17 NWLR (Pt. 1063) 333 378 in which the Supreme Court held thusly: ?Where parties enter into an agreement and subsequently decide to introduce new terms, they can only do so by specific reference to the earlier agreement to the effect that the latter agreement has introduced new terms thereof?.?

I agree with the holding of the trial Court that the tenor and nature of exemption/indemnity relied upon by the Defendant in this case is against the general and particular provisions of the Guidelines on Electronic Banking in Nigeria 2003 made pursuant to the Central Bank of Nigeria

(Establishment) Act, which is generally tailored to protect end users of electronic or internet banking having in mind the complexity and fragility of that area of banking.

I do not agree with the submission of the appellant that the Guidelines ought to have been pleaded and that since it is not pleaded in any of the pleadings in the trial Court, it should not have been relied on by the trial Court. It is beyond argument that the provisions of the Guidelines on Electronic Banking in Nigeria 2003 made pursuant to the Central Bank of Nigeria (Establishment) Act is a subsidiary legislation. Being a law, it need not be expressly pleaded before it can be relevant in the proceedings. Generally, pleadings contain facts not law. Most Rules of Court contain provisions restating this general principle of law. Order 12 Rule of the Niger State High Court (Civil Procedure) Rules 2012 requires only facts to be pleaded. As held by this Court inNWADIARO v. SHELL DEV. CO LTD (1990) 5 NWLR Pt. 150 pg 322 st 335 para A : ?the requisite of a good pleading are that it should contain a statement of, facts, not law, material facts only; facts not evidence; facts stated

in a summary form. I have also stated that as a general rule, inference of law should not be pleaded, but only facts from which such inference are sought to be drawn. See also SHELL PET. DEV. CO. v. BURUTU LGC (1998) 9 NWLR Pt. 565 at 318 Para E-F.

In any case, the respondent in paragraph 13 of the reply to statement of defence gave sufficient notice that it will challenge the enforceability of the indemnity as against Public Policy. Therefore it can rely on any law that shows that the said indemnity clause is not enforceable to show so.

Article 1.4.4 and 1.6 of the Guideline relied upon by the lower Court does not deal solely with ATM, it is a Know Your Customer (KYC) doctrine in Electronic banking generally, which enjoins banks to have sufficient details of the users of the platform in the event of cyber fraud such as in this case to protect the customer. The guideline also provides for insurance by the bank at Article 3.0 (F) to insulate themselves from loses which might occur from third party infiltrating in order to indemnify the customer. Therefore the law has envisaged the possibility of third party infiltration. Instead of taking cover under

the insurance policy as directed by the regulation, the appellant instead contended the respondent was negligent. By virtue of Paragraph 1.6 (I) of the same guidelines banks must establish controls that allow them to confirm third party recovery plans, review their financial condition, and establish data ownership with the third party.

In the light of the foregoing, issue No. 2 is resolved in favour of the respondent.

Let me now determine issue No. 3 which asks ?Whether Exhibit F a letter dated 22/11/2016 written as a reply to letter of demand Exhibit D, in the circumstances of this case, was written in contemplation of this suit and therefore inadmissible in evidence in virtue of Section 83(3) of Evidence Act and was justifiably expunged from the record.?

I have carefully read and considered the arguments of both sides in their briefs on this issue.

The part of the judgment of the trial Court complained against under this issue reads thusly-

?Exhibit F which appears to be an explanation on the part of the defendant was however only put together on the 22nd day of November, 2016 after the plaintiff had filed this

matter on the 21st day of November, 2016. While falling short of exculpating the defendant from the alleged liability in negligence; Exhibit F worst of all was made during the pendency of this suit before this Honourable Court and can be clearly considered contemplative of this suit. Learned counsel for the plaintiff urged this Court to expunge same out of the records of this Court for offending the Section 83(3) of the Evidence Act 2011. I agree with the submission of counsel for the plaintiff on this point of law. Accordingly the said Exhibit F is hereby expunged from the records of Honourable Court.?

On 11-11-20016, the respondent through its solicitors wrote Exhibit D, a letter to the appellant demanding for the reversal of the unauthorised debits of its account and return to its account of the monies withdrawn therefrom and giving notice of the respondent?s intention to sue the appellant if it fails to comply with the demand to reverse the unauthorised debits and withdrawals. On 22-11-2016, the appellant wrote Exhibit F in response to the respondent?s letter, Exhibit D. It is glaring from the evidence in the record of this appeal

that on 17-11-2016, the respondent filed a suit against the appellant in pursuance of its letter in Exhibit D and the originating processes in the suit were served on the appellant on 26-11-2016.

It is the respondent?s letter in Exhibit D that evoked the appellant?s response in Exhibit F. The appellant is bound by law to respond to Exhibit D if it disputes the facts and claims therein and if he fails to so respond, the law will deem the lack of response as an admission of the contents of exhibit D. See Nagebu & Co. Nig. Ltd v Unity Bank Plc., (2014) 7 NWLR (Pt. 1405) 42 at 81 in which it was held thusly- ?It is trite law that where a party fails to respond to business letter which by the nature of its content requires a response or a refutal of some sort, the party will be deemed to have admitted the contents of the letter. See GWANI v. EBULE (1990) 5 NWLR Pt. 149) 201.”

It is obvious that Exhibit F was written by the appellant a person interested, when the suit leading to this appeal was pending or anticipated. Exhibit D written by the respondent, also a person interested, prima facie showed that it was written in

anticipation of the said suit. S.83(3) of the Evidence Act 2011, which the trial Court held excludes the admissibility of Exhibit F and for that reason expunged it from the evidence as wrongfully admitted evidence reads thusly- ?Nothing in this section shall render admissible as evidence any statement made by a person interested at a time when proceedings were pending or anticipated involving a dispute as to any fact the statement might tend to establish.?

In view of the law that a party who fails to respond to a business letter which by the nature of its content requires a response or a refutal of some sort, would be deemed to have accepted the contents of the letter as correct, S.83(3) of the Evidence Act 2011 cannot be applied to exclude the response of such a party from evidence on the grounds that it was made during pending proceedings or in anticipation of such proceedings. Having admitted in evidence the respondent?s letter that required a response from the appellant, the application of S.83(3) of the Evidence Act against the admission of the appellant?s response in evidence would be inequitable and would violate the

appellant?s right to equal opportunity to be heard. The respondent who wrote Exhibit D which requires a response from the appellant cannot turn around to contend that the same response is not admissible as evidence. Equity will not allow him to do so. It is estopped by its letter in Exhibit D to do so. To allow S.83(3) of the Evidence Act to be invoked and applied in this manner would be unfair to the appellant. The respondent by its Exhibits D created the need for the appellant to write Exhibit F. If Exhibit F is excluded from the evidence, the appellant would benefit from the absence of a response from the appellant, as the appellant would be deemed by law to have accepted the contents of Exhibit D as correct. Equity will operate here to prevent the use of S.83(3) of the Evidence Act 2011 to cause injustice. As held by the Supreme Court in Akilu V Fawehinmi (NO2)(1989) LPELR-339(SC), Equity follows the law and is applied to ameliorate rigidity and inflexibility of the law. See Oshoboja V Amida (2009)LPELR-2803(SC).

In the light of the foregoing, I set aside the decision of the trial Court that Exhibit F was wrongly admitted and the order expunging

it from evidence. It is restored as part of the evidence in the case.

Issue No. 3 is resolved in favour of the appellant.

Let me now determine issue No. 4 which asks ?Whether the Respondent is entitled to judgment, in view of the evidence before the Court and in particular to the award of N1,000,000.00 (One Million Naira) and N500,000.00 (Five Hundred Thousand Naira) as damages for attorney?s fees and damages for dishonoured cheques respectively.”

I have carefully read and considered the arguments of both sides on this issue.

One of the questions thrown up by their arguments is whether solicitors fees can be claimed as special damages for breach of the contract.

Learned Counsel for the appellant argued that the fees the respondent paid its attorney to prosecute its claim in the suit is too remote from and in no way connected to the contract, that the trial Court was wrong to have held that ?the plaintiff successfully proved special damages claimed as per relief ?C? of the plaintiff?s amended statement of claim and that the trial court was wrong in awarding the sum of N1,000,000.00 as cost of

attorney?s fees in favour of the respondent. For this submission he relied on the Supreme Court decision in Ihekwoaba v. ACB Ltd (1998) 10 NWLR (Pt 571) 590 at 610.

Learned Counsel for the respondent argued that the trial Court rightly awarded special damages as per relief C representing solicitor?s fees, the same having been pleaded and proved and that it is now accepted in this country that solicitor?s fees can be claimed for as special damages. For this argument, he relied on the decision of this Court inJalbait Ventures (Nig) Ltd & Anor v. Unity Bank Plc (2016) LPELR ? 41625 (CA).

Let me now determine the merit of the arguments of both sides on this question.

I think that the law on the point is as stated by the Supreme Court in Ihekwoaba V ACB Ltd (supra) thusly ? ?The issue of damages as an aspect of solicitor?s fees in not one that lends itself to support in this country. There is no system of costs taxation to get a realistic figure. Costs are awarded arbitrarily and certainly usually minimally. I do not therefore see why the appellants will be entitled to general or any damages against the

auctioneer or against the mortgagee who engaged him, in the present case, on the ground of solicitor?s cost paid by them.? In Nwanji v Coastal Serv. Nig Ltd (2004) 18 NSCQR 895, the Supreme Court held that- ?It is an unusual claim and difficult to accept in this country as things stand today. ?The issue of damages as an aspect of solicitor?s fees is not one that lends itself to support in this country. There is no system of costs taxation to get a realistic figure. Costs are awarded arbitrarily and certainly usually minimally. I do not therefore see why the appellants will be entitled to general or any damages against the auctioneer or against the mortgagee who engaged him, in the present case, on the ground of solicitor?s costs paid by them.?

The award of 1 Million Naira cost of Attorney?s fees as special damages for breach of contract runs contrary to the legally recognised principle for the award of damages for breach of contract. Damages for breach of contract remedy the loss arising from the breach, which loss must be within the reasonable contemplation of the parties to the contract at the time the

contract was made or which naturally flows directly from the breach. See Universal Vulcanising (Nig) Ltd v Ijesha United Trading & Transport & Ors (1992) LPELR ? 3415 (SC), Union Beverages Ltd V Owolabi (1988) 1 SC 33, Wahabi v Omonuwa (1976) LPELR ? 3469 (SC) and Machine Umudge & Anor v SBPDC Nig Ltd (1975) LPELR ? 3375 (SC) or 9-11 SC II.

So damages cannot be awarded for costs incurred in an action to seek remedy for the loss suffered by a party to a contract as a result of the breach of the contract by the other party to the contract. The cost of litigation is not a loss arising from the breach of contract. This Court in Mbanugo v Nzefili (1997) LPELR ? 5483 (CA) distinguishing between damages and costs held that ?while costs are like damages, awarded as compensation, there is as to costs no restitution in intergum.”

thusly- ?The emphasis here is the restitution of the party that had succeeded as to the cost he incurred in the litigation, either for prosecuting his claim or defending the action. The decisions referred to by learned respondent?s counsel on this issue, Onabanjo v. Ewetuga (1993) 4 NWLR (Pt.288) 445 and Uzoma v. Okorie (2000) 15 NWLR (Pt. 692) 882 at 893 wherein factors the trial Court should consider in awarding costs have been outlined are apposite. These include:- (a) The summons fees paid; (b) the duration of the case; (c) the number of witnesses called by the party in victory; (d) the vexatious or frivolous nature of the action or defence of the party failed in the litigation; (e) The cost of legal representation; (f) the monetary value at the time of incurring the expenses; and (g) the value and purchasing power of the currency of award at the time of the award. The trial Court in considering the foregoing factors need not explain how it arrived at the sum it eventually awarded as cost. This has been the practice.?

The trial Court erred in law for awarding as special damages for the breach of the banker customer contract, the cost

of respondent?s solicitor?s fees for prosecuting the respondent?s claim. Such an award cannot stand as special damages. It is hereby set aside.

Let me now consider the complain against the award by the trial Court of the sum of N500,000.00 as general damages for the appellant?s refusal to honour the respondent?s cheque of 10-11-2016 for the sum of 8 Million Naira.

The part of the judgment of the trial Court complained against here reads thusly –

?It is the Plaintiff?s case that on the 10th day of November, 2016 it issued a Cheque for the transfer of the sum of N8,000,000.00 (Eight Million Naira) being less than the total sum of monies belonging to the Plaintiff?s deposited in the defendant?s custody as monies had and received as at the 10th November, 2016. However, the said cheque was dishonoured by the defendants thereby depriving them of access to their funds. Exhibit C is the Plaintiff?s UBA Cheque Leaf with Cheque Number 27412127. It is marked ?DAR? {Dishonoured and Returned}.”

It is one thing to establish that the demand for payment was dishonoured by the

banker as in this case, by virtue of Exhibit C. it is also another thing to show that there was indeed enough funds enough to meet the said demand. This duty is that of the Plaintiff who claims the defendant is liable in damages for monies had and received. Exhibit A which is the bank statement of the Plaintiffs covering the period 1st October, 2016 to 9th November, 2016. As at the 9th day of November, 2016, as shown by the information on Exhibit A, the balance on the plaintiff?s account with the defendant is N5,058,574.24 (Five Million, Fifty Eight Thousand, Five Hundred and Seventy Four Naira, Twenty-four Kobo) only. This clearly is below the amount demanded by Exhibit C which could not have been said to be sufficient to meet the said demand.

Surprisingly however, the Defendant never challenged this pleading by any material denial. They indeed were mute throughout the proceedings with respect to this fact. The plaintiff?s witness were not even cross-examined to test the veracity of the said allegation. The law is trite in this circumstance that facts which are not denied or contested in any material way need not be proved. The law is well settled on

this point and I will not take much judicial time dwelling on same. See the cases of Yusuf vs. Oyetunde & Ors. (1998) 12 NWLR (Pt.579) p. 483. In Efet vs. INEC & Ors. (2011) LPELR-8109 (SC), the Supreme Court per Muhammad, J.S.C. at Pp.24-25, paras. F-A stated as follows:

Party, that fact is deemed admitted in law by the other party. I cannot hold differently from the erudite jurist, my lord justice Muhammed above, in this instant case as well, the Defendant is deemed to have admitted the fact that it refused to honour the valid and proper demand for payment by the plaintiff when he had funds sufficient enough to meet the said demand. Consequently, issue 4 (four) is also resolved in favour of the plaintiff.?

Learned Counsel for the appellant has argued that the cheque of 8 million naira was rightly dishonoured since there was no sufficient funds in the account to pay the cheque, as the amount in the account as at 10-11-2016 was N5,058,574.24 and so there was no basis for the award of 500,000 naira as general damages as the respondents contractual right was not breached by the dishonour of the cheque.

?The above arguments of

Learned Counsel for the Appellant cannot stand against the background that the appellant negligently allowed the unauthorised withdrawal of N9,293,578.15 from the respondent?s current account with it on 21-10-2016 and that if the appellant had not allowed the said unauthorised withdrawals of the respondents money, its current account would have had sufficient funds to pay the cheque of 8 million naira on 10-11-2016.

So the appellant?s failure to pay the cheque of 8 million naira is a breach of contract that was directly caused by the appellant?s negligence in allowing the unauthorised withdrawal of above 9 million naira from the respondent?s current account. Without the said unauthorised withdrawal, the credit balance in the respondent?s current account with the appellant would be over 15 million naira, an amount sufficient to pay the cheque of 8 million naira. So the cheque was dishonoured because the amount to the credit of the respondent in its account with the appellant, sufficient to pay the cheque, was withdrawn therefrom without the knowledge and authority of the respondent. The appellant was bound to honour the cheque

since the respondent had over 15 million naira in its account with it. The amount of N5,058,574.24 indicated in the account as the credit balance is not the actual credit balance in that account, as it omits the unauthorised withdrawals.

Since the N9,293,578.15 was withdrawn without the knowledge and authority of the respondent, it is still standing to its credit in its account with the appellant who was therefore bound to pay the 8 million naira cheque as there was sufficient fund in the account to pay it. By virtue of S.37(3) of the Cybercrimes (Prohibition Prevention) Act 2015, the appellant was bound to provide clear legal authorization for the unauthorised debits or reverse the unauthorized debits within 72 hours after it was informed by the Managing Director of the respondent on 21-10-2016 or it received the formal letter from the respondent on 24-10-2016 complaining about the unauthorized debits of 21-10-2016.

The exact of S.37(3) of the Cyber Crimes (Prohibition Prevention) Act 2015 reads thusly-

?A financial institution that makes an unauthorized debit on a customers account shall, upon written notification by the

customer, provide clear legal authorization for such debit to the customer or reverse such debit within 72 hours and any financial institution that fails to reverses such debit within 72 hours, commits an offence and is liable on conviction to restitution of the debit and a fine of =N5,000,000.00.” The appellant did not provide any clear authorization of the debits within 72 hours of receipt of the letter from the respondent on 24-10-2016 complaining about the unauthorized debits. It was bound to reverse the debits within the same 72 hours.

As held by the Supreme Court in Allied Bank of Nigeria Ltd v Akubueze (1997) LPELR ? 429 ( SC) -?On the other hand, relief ?C? on the other hand qualifies as special damages since it amounts to an actual but not foreseeable injury suffered by the Plaintiff. The question is, did the plaintiff successfully plead and demonstrate same? My answer will be in the affirmative. The plaintiff successfully pleaded the fact of solicitor?s expenses and during the hearing of the case tendered solicitor?s Bill of Charges which was admitted in evidence as Exhibit E. The

defendant never cross-examined the plaintiff?s witnesses on this fact neither did it actively challenge same. With these considerations in mind, I find that the plaintiff successfully proved special damages claimed as per reliefs ?C? of the Plaintiff?s Amended Statement of Claim. This issue is equally resolved in favour of the plaintiff in part.

The first basic point that must be made is that a bank is bound to honour a cheque issued by its customer if the customer has enough funds to satisfy the amount payable on the cheque in respect of the relevant account. Refusal to honour the cheque will amount to a breach of contract which would render the banker liable in damages.?

The trial Court was right to have awarded general damages for the wrong dishonour of the respondent?s cheque by the appellant. See Balogun V NBN (1978) 11 NSCC 133, UBN PLC V Chimaeze (2014) 9 NWLR (Pt. 1411) 166 at 95, Oyewole v Standard Bank of West Africa (1968) 2 All NLR 32 and Access Bank Plc v Maryland Finance Co. & Consultancy Service (2005) 3 NWLR (Pt. 913) 460.

In the light of the foregoing, issue No. 4 is resolved in part in

favour of the appellant.

On the whole, this appeal succeeds in part and only in respect of the decision of the trial Court expunging Exhibit F as wrongly admitted evidence and in respect of the award of special damages of 1 Million Naira for costs of solicitors fees. The parts of the judgment of the High Court of Niger State at Suleja in Suit No. NSHC/SD/93M/2016 expunging Exhibit G as wrongly admitted evidence and awarding special damages of 1 Million naira for costs of solicitors fees are hereby set aside. All other parts of the judgment are hereby affirmed and upheld.

The appellant shall pay costs of N400,000.00 to the respondent.

CROSS APPEAL

I will determine this Cross-Appeal on the basis of the issues raised in the cross appeal.

Let me start with issue No. 1

This issue lacks merit in view of my holding in the main appeal that the claim for special damages for costs of Solicitor?s fees is wrong in law and should not have been granted. Having set aside that award, this issue is rendered unarguable.

It is resolved in favour of the Cross-Respondent.

Let me now determine Issue No. 2

?I have carefully

read and considered the arguments of both sides on this issue.

I do not agree with the argument of Learned Counsel for the Cross appellant that S.37(3) of the Cyber Crimes (Prohibition, Prevention) Act 2015 prescribed a minimum amount of 5 Million naira that must be awarded as general damages for the unauthorised debits of a customer?s account by a bank or other financial institution.

At the risk of being prolix, I reproduce the exact of that provision here as follows-

?A financial institution that makes an unauthorized debit on a customers account shall, upon written notification by the customer, provide clear legal authorization for such debit to the customer or reverse such debit within 72 hours and any financial institution that fails to reverse such debit within 72 hours, commits an offence and is liable on conviction to restitution of the debit and a fine of =N5,000,000.00.”

The provision makes the appellant?s failure to provide clear authorization of the unauthorized debit or reverse the debit within 72 hours of being notified of the debit by the respondent an offence punishable by a fine of 5 million

naira. The provision did not prescribe any general damages that the Court must award for such wrongful debits. The 5 million naira mentioned therein is the fine it prescribes as punishment for the offence created therein.

The Cross appellant has not shown why it considers the sum of N500,000.00 awarded as general damages by the trial Court as too low. It is not enough to merely assert that the amount awarded is too low. The party so asserting must demonstrate by reference to the facts of the case that the amount is indeed too low. The Cross appellant failed to show that the trial Court did not exercise its discretion in making the award judicially and judiciously. Unless it is shown that the trial Court did not properly exercise its discretion in making the award, this Court, as an appellate Court cannot interfere with the award. In UBN PLC V. Ajabule & Anor (2011) LPELR ? 8239 (SC) the Supreme Court held that ? ?The law is trite that where general damages are claimed, if the issue of liability is established as in the present case, the trial Judge is entitled to make his own assessment of the quantum of such general damages and, on

appeal, such general damages will only be altered or varied if they were shown to the either so manifestly too high or so extremely too low or that they were awarded on an entirely wrong principle of law as to make it, in the judgment of the appellant Court, an entirely erroneous estimate of the damage to which the plaintiff is entitled. See the cases of Zik Press Limited v. Ikoku (1951) 13 WACA 188; Idahosa v. Orosanye (1959) 4 F.S.C. 166; Bola v. Bankole (1986) 3 NWLR (Pt. 27) 141 and Ijebu-Ode Local Government v. Balogun and company Limited (1991) 1 N.W.L.R. (pt. 156) 136.?

As a general principle an appellate Court would not interfere with an award of damages by a trial Court simply because faced with a similar situation and circumstance, it would have awarded a different amount. There are, however, some guiding principles. An appellate Court will interfere with an award by the trial Court where it is clearly shown ? 1. That the trial Court acted upon wrong principles of law; or 2. That the amount awarded by the trial Court is ridiculously too high or too low; 3. That the amount was an entirely erroneous and unreasonable estimate having

regard to the circumstances of the case. For the above, See: James v. Mid-Motors (1978) 12 SC 31, Bala v. Bankole (1986) 3 NWLR (Pt. 27) 141; Oduwole v. West (2010) 5 SCNJ 97 at page 108.? See also SPDC Nig Ltd v. Tiebo VII (2005) 3 ? 4 SC 137.

In the light of the foregoing, Issue No. 2 is resolved in favour of the Cross-respondent.

On the whole, this Cross appeal fails as it lacks merit. It is accordingly dismissed.

I make no order as to costs.

TINUADE AKOMOLAFE-WILSON, J.C.A.: I had the preview of the lead judgment of my learned brother, EMMANUEL AKOMAYE AGIM, JCA.

I am in agreement with his reasoning and conclusion and orders reached therein.

MOHAMMED BABA IDRIS, J.C.A.: My learned brother EMMANUEL AKOMAYE AGIM, JCA afforded me the opportunity of reading before today a draft copy of the lead judgment just delivered.

?I adopt the judgment as mine with nothing further to add.

Appearances:

G. Ofodile Okafor, SAN with him, T.N. Nwachukwu, Esq.For Appellant(s)

M.J. Numa, Esq. with him, I.G. Kelubia, Esq., E.O. Agi, Esq., Y.M. Zakari, Esq. and P.T. Agbo, Esq.For Respondent(s)

Appearances

G. Ofodile Okafor, SAN with him, T.N. Nwachukwu, Esq.For Appellant

AND

M.J. Numa, Esq. with him, I.G. Kelubia, Esq., E.O. Agi, Esq., Y.M. Zakari, Esq. and P.T. Agbo, Esq.For Respondent

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