UT FINANCIAL SERVICES NIGERIA LIMITED v. HACKIT MOVERS NIGERIA LIMITED & ANOR
(2019)LCN/13153(CA)
In The Court of Appeal of Nigeria
On Wednesday, the 24th day of April, 2019
CA/L/578/2013
RATIO
FINANCIAL AND ECONOMIC CRIMES: MEANING
The community effect of the definition of financial and economic crimes in Section 46, the powers and functions vested in the 2nd Respondent under Section 6 and 7 as well as the provisions of Section 41 of the Act, is that the 2nd Respondent is vested with the powers and functions conferred on the officers of the Nigeria Police in the investigations and prosecution of offences under the Act. The law is known that in the discharge of their functions and performance of the duty under Section 4 of the Police Act, police officers are entitled to invite and question any person reasonably suspected to have committed an offence or from whom relevant and useful information by be obtained on the commission of a criminal offence. The Police may do so either on its own motion or upon receipt of a formal complaint from any person or members of the public. See Fawehinmi v. IGP (2000) 7 NWLR (665) 481 @ 525; Fawehinmi v. IGP (2002) 7 NWLR (767) 606 @ 645, (2002) 5 SC (Pt 1) 63; Luna v. COP (2010) LPELR-8642(CA); Igbo v. Durueke (2014) LPELR-22816(CA); Johnson v. Lufadeju (2002) 1 NWLR (768) 203; Onah v. Okenwa (2010) 7 NWLR (1194) 512; FCMB, Plc v. Ette (2008) 22 WRN, 1.PER MOHAMMED LAWAL GARBA, J.C.A.
CHEQUES: DUTY ON THE PERSON WHO RECEIVES A COUNTERFEIT CHEQUE
In this regard, since the issuance of a dishonoured cheque drawn an account in settlement or purported settlement of an obligation under an enforceable contract is a penal offence under Section 2(b) of the Dishonoured Cheques (Offences) Act, any person issued with such a cheque by a party with who he had an enforceable contract, in settlement of an obligation under the contract, has not only the right, but the civic duty and obligation to report the fact to the relevant authorities for investigation. SeeFajemirokun v. Comm.. Bank Nig. Ltd (supra) also reported in (2009) SC (Pt.1) 5 NWLR (1135) 988; Isheno v. Julius Berger Nig. Plc (2008) 6 NWLR (1084) 582; Arab Contractors (O. A. O.) Nig. Ltd v. Umanah (2013) 4 NWLR (1344) 323. PER MOHAMMED LAWAL GARBA, J.C.A.
JUSTICES
MOHAMMED LAWAL GARBA Justice of The Court of Appeal of Nigeria
JOSEPH SHAGBAOR IKYEGH Justice of The Court of Appeal of Nigeria
ABIMBOLA OSARUGUE OBASEKI-ADEJUMO Justice of The Court of Appeal of Nigeria
Between
UT FINANCIAL SERVICES NIGERIA LTD – Appellant(s)
AND
1. HACKIT MOVERS NIGERIA LTD
2. ECONOMIC & FINANCIAL CRIMES COMMISSION – Respondent(s)
MOHAMMED LAWAL GARBA, J.C.A. (Delivering the Leading Judgment): By a motion dated 16th April, 2012 filed as Suit No. FHC/L/CS/371/2010, before the Federal High Court, sitting at Lagos (the Lower Court), the 1st Respondent herein (also the 1st Respondent in Appeal No. CA/L/674/2018 by the 2nd Respondent herein) had sought declarations and order of injunction against the 2nd Respondent in respect of arrest and detention of its members of staff on the basis of a report by the Appellant. In a Ruling delivered by the Lower Court on 25th February 2013, the reliefs were granted and dissatisfied therewith, the Appellant brought this appeal vide the Notice of appeal dated 26th March 2013, filed on 5th April, 2013.
From the six (6) grounds contained on the Notice of Appeal, two (2) issues were formulated in the Appellant?s brief filed on 22nd April 2014, deemed on the 9th February, 2017 as follows: –
2.1 Whether the findings of the learned trial judge that the Appellant, by its petition, brought about the arrest and detention of the 1st Respondent?s staff in bad faith, was supported by law and the evidence
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before the Court.
2.2 Whether the learned trial judge was right to have granted a perpetual injunction restraining the 2nd and 3rd Respondents law enforcement agencies from inviting, arresting and detaining the staff of the 1st Respondent.?
There is no record that any of the Respondents filed a brief for the prosecution of the appeal even though they were all duly served with the Appellant?s Brief and other processes of the appeal. The Application filed by the 2nd Respondent on 5th February, 2018 for extension of time to file its brief was withdrawn along with the 2nd Respondent filed on the same date and struck out by the Court on the 8th March, 2018.
In the absence of a brief from any of the Respondents to answer or respond to the arguments canvassed on the issues raised for decision in the appeal by the Appellant, the appeal is unopposed by all the Respondents and is to be decided on the issues of the Appellant since the Respondents are deemed to have conceded to them. Okongwu v. NNPC (1989) 4 NWLR (115) 296; Salau v. Para-koyi (2001) 13 NWLR (731) 602; FBN, Plc v. Akinyosoye (2005) NWLR (918) 340; Shona-Jason Ltd. v. Omega
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Air Ltd (2006) 1 NWLR (960) 1; Ugboaja v. Sowemimo (2008) 10 MJSC, 105
Inspite of this position, the appeal is to succeed or fail on the sustainability in law, of the issues canvassed in the Appellants brief and not merely on the absence of the Respondents briefs.
APPELLANTS SUBMISSIONS:
It is submitted that the statement by the Lower Court that the Appellant?s petition to the 2nd Respondent was in bad faith, was not supported by the facts and evidence placed before it. According to Counsel, the affidavit evidence before the Lower Court showed that the 1st Respondent issued a number of post dated cheques as security for the loan granted to it by the Appellant and that three (3) of the cheques were returned unpaid upon presentation by the Appellant on the due dates. He said since it is criminal offence to issue cheques knowing that the account on which they were drawn, is not funded to pay them, citing Sections 1(b) and 2 of the Dishonoured Cheques (Offences) Act, 2004, the report or petition to the 2nd Respondent on the issuance of the dishonoured cheques by the 1st Respondent was not in bad faith, but on the belief
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that an offence was committed thereby. In further argument, learned Counsel said the Lower Court?s decision was based on misconception of the origin of the transaction between the parties which was a commercial one arising from a loan and relying on Gbajor v. Ogunburegui (1961) ALL NLR (1) 882; Rev. Enanuga v. Sampson (2012) LPELR-8489 and Fajemirokun v. Comm. Bank Nig. Ltd (2009) 21 WRN, 1, that the Appellant has the duty to report the commission of a crime to the police for investigation. Learned Counsel maintains that there was no mala fide or bad faith in the petition by the Appellant and that in the premises of the above arguments, the Lower Court erred to have granted perpetual injunction against the 2nd and 3rd Respondents from investigating, arresting and detaining members of staff of the 1st Respondent, on the authority of A. G. Anambra State v. Uba (2005) 33 WRN, 191 @ 213. It is the further argument of Counsel that the 1st Respondent has no cognisable legal right upon which the injunction granted could be granted, in law as stated in Kotoye v. CBN (1989) ALLNLR, 76. He also cited paragraphs 14, 17-22 and 25 of the 2nd Respondent?s Counter
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Affidavit to the 1st Respondent?s motion before the Lower Court and insists that the finding by that Court that the case of the 1st Respondent was civil and not criminal was wrong in law since it is the allegation against a party that determines the nature and not the explanations offered by the party, relying on Nnamdi Azikiwe Univ. v. Nwafor (1999) 1 NWLR (585) 116 at 136. It is then submitted that the 2nd and 3rd Respondents have a duty to investigate the criminal complaint forwarded to them in accordance with the statutory powers and functions as provided for in Section 6, 7 and 41 of the 2nd Respondent?s Act, 2004, which the Lower Court was wrong to have interfered with by the order perpetual injunction granted.
In conclusion, the Court is urged to allow the appeal and set aside the decision by the Lower Court.
?
Now, the petition (letter) from the Appellant to the 2nd Respondent in respect of which the 2nd Respondent took the action that led to the 1st Respondent?s action or motion before the Lower Court was in the following terms: –
?FEBRUARY 28th, 2012
The Head of Operations
Economic and Financial Crimes
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Commission,
15A Awolowo Road,
Ikoyi, Lagos.
Dear Sir,
RETURNED CHEQUES HACKITT MOVERS NIGERIA LIMITED
We wish to report the above named company, represented by the CEO, Mr. Bello Olaoye, to your esteemed organization for issuing us with dud cheques for the repayment of a loan facility contracted from UT Financial Services Nigeria Ltd.
Hackitt Movers Nigeria Limited on the 23rd June, 2011 was advanced a business loan of ?25m (Twenty Five Million Naira) facility with the understanding as contained in the agreement he signed with us on that same day, that they would repay same in four monthly installments with effect from July 23rd, 2011 (Copies of agreement ad post dated cheques are herein attached).
Please the following cheques which they issued to us even though we sought their consent before presenting bounced.
1. The firs Diamond Bank Cheque No. (29531111) dated 27th September, 2011, for the sum of ?7,000,000.00 (Seven Million Naira only).
2. The second Diamond Cheque No (30402982) dated 11th October, 2011, for the sum ?6,000,000.00 (Six Million Naira only).
Sir, we would implore you to use
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your good office to invite the above named company to your office for the sole purpose of redeeming all dishonored cheques as they have from the inception of this transaction been issuing dud cheques to us.
Thank you.
Yours faithfully,
FOR UT FINANCIAL SERVICES NIGERIA LIMITED
SIGNED
ERIC MARTINS
MANAGING DIRECTOR.?
As can easily be seen, the purpose(s) of the above letter was stated in the first and last paragraphs thereof, which was to report issuance of ?dud cheques? by the 1st Respondent to the Appellant for the payment of a loan facility and ?for the sole purpose of redeeming all dishonoured cheques as they have from the inception of this transaction been issuing dud cheques? (sic).
Apparently therefore, the letter was primarily to report the issuance of cheques which were dishonoured (dud cheques) by the 1st Respondent and secondarily, for the 2nd Respondent to recover or redeem the sums covered by the dishonoured (dud) cheques.
There was/is no dispute between the parties and no issue was joined by them on the fact that the transaction between the Appellant and 1st Respondent
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which led to the latter issuing cheques to the Appellant was purely contractual, commercial and civil in nature as a loan transaction. As can be discerned from the above letter by the Appellant to the 2nd Respondent, the complaint therein was not failure or refusal by the 1st Respondent to repay or even abide by the terms and conditions of the loan facilities granted to it by the Appellant, but that in meeting or satisfaction of the said terms and conditions for repayment of the loan, the 1st Respondent issued cheques which when presented on the due dates, for payment in the Banks and on the accounts on which they were drawn, were dishonoured. In the 1st Respondent?s Affidavit in supporting the summons as well as the Further Affidavit, the fact of issuing of the specified cheques mentioned in paragraphs 10, 11 and 14 of the Appellant?s Counter Affidavit, was not denied or that the cheques were, in fact and deed, dishonoured when presented for payment on the due dates entered on them.
Sections 1 (b) and 2 (b) of the Dishonoured Cheques Offences Act, 2004 provide as follows: –
1(b) Any person who obtains credit for himself or any
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other person, by means of a cheque that, when presented for payment not later than three months after the date of the cheque, is dishonoured on the ground that no funds or insufficient funds were standing to the credit of the drawer of the cheque in the bank on which the cheque was drawn, shall be guilty of an offence.
Section 2 of the same Act provides further that:
Where any offence under this Act by a body corporate is proved to have been committed with the consent of or connivance of, or to be attributable to any neglect on the part of any director, manager, secretary or other similar officer, servant or agent of the body corporate (or any person purporting to act in any such capacity), he, as well as the body corporate, shall be deemed to be guilty of the offence and may be proceeded against and punished in the same manner as an individual.?
By these provisions, issuance of cheques by a person or body corporate, such as the 1st Respondent, in satisfaction of a contractual obligation which were dishonoured when presented to the Bank for payment, simpliciter, is an offence under the Act, punishable with imprisonment or fines
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respectively, as the case may be. The provisions create and punish the offence of issuance of dishonoured cheques by a person or corporate body, thereby making it a penal and criminal offence.
The 2nd Respondent, established in Section 1 of the Economic and Financial Crimes Commission Act, 2004 (the Act) is vested with the powers and functions for investigation of all financial crimes in Nigeria under Sections 6 and 7 of the Act. In particular, Section 7 provides that: –
?7(1) The Commission has power to ?
(a) cause investigation to be conducted as to whether any person, corporate body or organisation has committed an offence under this Act or other law relating to economic and financial crimes;
(b) cause investigations to be conducted into the properties of any person if it appears to the Commission that the person?s lifestyle and extent of the properties are not justified by his source of income.
(2) In addition to the powers conferred on the Commission by this Act, the Commission shall be the co-ordinating agency for the enforcement of the provisions of ?
(a) the Money Laundering Act, 2004; 2003 No. 7,
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1995 No. 13;
(b) the Advance Fee Fraud and Other Related Offences Act, 1995;
(c) the Failed Bank (Recovery of Debt and Financial Malpractices in Banks) Act, as amended;
(d) the Banks and Other Financial Institutions Act, 1991, as amended;
(e) the Miscellaneous Offences Act; and
(f) any other law or regulation relating to economic and financial crimes, including the Criminal Code and Penal Code.
Section 46 of the Act defines Economic and financial crimes as follows:
economic and financial crimes? means the non-violent criminal and illicit activity committed with the objective of earning wealth illegally either individually or in a group or organized manner thereby violating existing legislation governing the economic activities of government and its administration and includes any form of fraud, narcotic drug trafficking, money laundering, embezzlement, bribery, looting and any form of corrupt malpractices, illegal arms deals, smuggling, human trafficking and child labour, illegal oil bunkering and illegal mining, tax evasion, foreign exchange malpractices including counterfeiting of
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currency, theft of intellectual property and piracy, open marker abuse, dumping of toxic wastes and prohibited good, etc;?
Then Section 41 of the Act says that:
41. Immunities
Subject to the provisions of this Act, an officer of the Commission when investigating or prosecuting a case under this Act, shall have all the powers and immunities of a Police Officer under the Police Act and any other law conferring power on the police, or empowering and protecting law enforcement agencies.
The community effect of the definition of financial and economic crimes in Section 46, the powers and functions vested in the 2nd Respondent under Section 6 and 7 as well as the provisions of Section 41 of the Act, is that the 2nd Respondent is vested with the powers and functions conferred on the officers of the Nigeria Police in the investigations and prosecution of offences under the Act. The law is known that in the discharge of their functions and performance of the duty under Section 4 of the Police Act, police officers are entitled to invite and question any person reasonably suspected to have committed an offence or from whom
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relevant and useful information by be obtained on the commission of a criminal offence. The Police may do so either on its own motion or upon receipt of a formal complaint from any person or members of the public. See Fawehinmi v. IGP (2000) 7 NWLR (665) 481 @ 525; Fawehinmi v. IGP (2002) 7 NWLR (767) 606 @ 645, (2002) 5 SC (Pt 1) 63; Luna v. COP (2010) LPELR-8642(CA); Igbo v. Durueke (2014) LPELR-22816(CA); Johnson v. Lufadeju (2002) 1 NWLR (768) 203; Onah v. Okenwa (2010) 7 NWLR (1194) 512; FCMB, Plc v. Ette (2008) 22 WRN, 1.
In this regard, since the issuance of a dishonoured cheque drawn an account in settlement or purported settlement of an obligation under an enforceable contract is a penal offence under Section 2(b) of the Dishonoured Cheques (Offences) Act, any person issued with such a cheque by a party with who he had an enforceable contract, in settlement of an obligation under the contract, has not only the right, but the civic duty and obligation to report the fact to the relevant authorities for investigation. SeeFajemirokun v. Comm.. Bank Nig. Ltd (supra) also reported in (2009) SC (Pt.1) 5 NWLR (1135) 988; Isheno v. Julius Berger Nig. Plc
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(2008) 6 NWLR (1084) 582; Arab Contractors (O. A. O.) Nig. Ltd v. Umanah (2013) 4 NWLR (1344) 323. Such authorities include the 2nd and 3rd Respondents, who have the statutory duty, functions and powers to prevent, investigate and prosecute the commission of penal offences punishable under and by existing statutory provisions. See Agbi v. Ogbeh (2005) 8 NWLR (926) 40; Christlieb Plc. v. Majekodunmi (2008) 16 NWLR (113) 234; Onah v. Okenwa (2010) 7 NWLR (1194) 512. The mere fact of reporting the alleged or suspected commission of the offence under Section 2(b) of the Dishonoured Cheques (Offences) Act (DCOA) to any of the relevant authorities for investigation by a party to a contract who was issued a dishonoured cheque in satisfaction or settlement of an obligation under the contract does not alone show any bad faith or mala fide simply because the party is the beneficiary of the dishonoured cheques or that the cheque was issued in a purely civil contractual or commercial transaction. It is the law which makes or creates a penal offence out of a purely civil, contractual or commercial transaction and it does not punish failure or breach of the contractual
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obligations by the parties to the commercial transaction. See Danfulani v. EFCC (2016) 1 NWLR (1493) 223.
It should however be pointed out that the only legitimate powers, function and duty of the relevant authorities to whom a report of the alleged commission of an offence under Section 2(b) of Dishonoured Cheques (Offences) Act, is to investigate the facts of the alleged offence for the purpose of taking appropriate action thereafter of either prosecuting the party alleged to have committed the offence if the evidence warrants such an action, or to discard the allegation. Their duty and power of investigation and possible prosecution does not include the recovery of the sums in respect of which the dishonoured cheques(s) was/were issued, from, the party alleged to have issued the cheque(s) as debt owed from the transaction which led to the commission of the offence. Recovery of debt arising from purely civil and contractual transactions is not part of the functions, duty and powers of investigative and prosecutorial authorities such as the 2nd and 3rd Respondents. Afribank, Plc v. Onuwa (2004) 2 NWLR (855) 342; Abdullahi v. Buhari (2004) 17 NWLR (902)
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278; Jaja v. COP (2011) 2 NWLR (1231) 375.
However, as stated earlier, the 2nd and 3rd Respondents have requisite statutory powers to investigate the allegation of the commission of the penal offence of issuance of dishonoured cheques, and in the course of such investigations, invite, question and when necessary, arrest and detain any person(s) from whom relevant and material information could be obtained on the facts constituting the commission of the alleged offence. From the aggregate of the facts contained in the Affidavits filed by the 1st Respondent in support of the application before the Lower Court its complaint was primarily that the 2nd and 3rd Respondents invited, questioned and detained members of its staff for some hours over the petition by the Appellant which arose out of a contractual transaction of a loan. As demonstrated before now, although the offence of issuance arose out of a civil contractual relationship between the parties, yet the 2nd and 3rd Respondents possess the requisite statutory powers to investigate it and take actions found to be necessary thereon and that such powers are circumscribed and limited to the investigation
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of the commission of the offence and not enforcement of the civil obligations of the parties under the transaction in respect of which the offence was allegedly committed. It was not the dispute arising from the contractual relationship between the parties that was the purport of the letter, petition or complaint written by the Appellant to the 2nd Respondent, but rather, as clearly shown, the offence of issuance of ?dud cheques? by the 1st Respondent to the Appellant in the purported settlement of its contractual obligation, for investigation and further action that may be found necessary. The statutory powers and functions vested and conferred on the 2nd and 3rd Respondents, should not except where manifestly abused or misapplied, be interfered with or curtailed by judicial fiat, Fawehinmi v. IGP (supra) Atakpa v. Ebatore (2015) 3 NWLR (1447) 549; IGP v. Ubah (2015) 11 NWLR (1471) 405; Hassan v. EFCC (2014) 1 NWLR (1389) 607.
The facts in this appeal must be differentiated from those cases in which the complaint, petition or report to the 2nd and 3rd Respondents was primarily on failure, refusal to perform or breach of contractual
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obligations arising from purely civil transactions between parties wherein the main and real purpose is to use them to enforce the performance of such obligations by the defaulting party.
The complaint or petition by the Appellant to the 2nd Respondent, once more, was on issuance of dud cheques by the 1st Respondent in settlement of a contractual obligation which is a penal offence to be investigated by the 2nd Respondent.
In the above premises, since the 2nd and 3rd Respondents have the statutory powers to investigate the allegation of issuance of dud cheques, a penal offence, against the 1st Respondent, the invitation, questioning, arrest and detention of members of its staff for the purpose of the investigation, cannot be rightly said to be unlawful, illegal or an infringement of the fundamental right to liberty of the said members of staff. See McLaren v. Jamming (2003) NWLR (154) 528; Al-Mustapha v.State (2013) 17 NWLR (1383) 350; Nyame v. FRN (2010) 7 NWLR (1193) 344. The Lower Court was wrong in law to have declared the arrest and detention by the 2nd Respondent in the course of investigating of the offence of issuing dishonoured cheque by
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the 1st Respondent to the Appellant in purported settlement of a contractual obligation, as unlawful.
In the final result, I find merit in this appeal and allow it for reasons aforenamed. As a consequence, the judgement delivered by the Lower Court on 25th of March, 2013 granting the 1st Respondent reliefs sought in the motion dated 16th April, 2012, is hereby set aside and the motion is hereby dismissed for being unmeritorious.
Parties to bear their respective costs of prosecuting the appeal.
JOSEPH SHAGBAOR IKYEGH, J.C.A.: I agree with the judgment prepared by my learned brother, Mohammed Lawal Garba, J.C.A., (Hon. P.J.).
ABIMBOLA OSARUGUE OBASEKI – ADEJUMO, J.C.A.: I have read the lead Judgment of my learned brother, MOHAMMED LAWAL GARBA, JCA and I agree with the judgment.
I have no hesitation in agreeing with the reasoning and conclusion arrived at by my learned brother.
I too hold that the appeal has merit and the decision of the lower Court is set aside. I abide by all consequential orders in the lead judgment.
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Appearances:
L.C. Okoli with him, P.E. SodjeFor Appellant(s)
B.O.A. Sonoiki for the 2nd Respondent.
1st and 3rd Respondents not represented
For Respondent(s)
Appearances
L.C. Okoli with him, P.E. SodjeFor Appellant
AND
B.O.A. Sonoiki for the 2nd Respondent.
1st and 3rd Respondents not representedFor Respondent
