IN THE HIGH COURT OF THE FEDERAL

CAPITAL TERRITORY, ABUJA

HOLDEN AT ABUJA

ON TUESDAY, 12TH DAY OF JULY, 2011

BEFORE HON. JUSTICE SYLVANUS C. ORIJI

[
SUIT NO. FCT/HC/CV/752/2009

BETWEEN

1. CENTURION NIGERIA LIMITED

2. MR. ENOH C. INOH PLAINTIFFS
(EXECUTIVE DIRECTOR/CEO)

AND

DIAMOND BANK PLC. --- DEFENDANT

JUDGMENT
In their statement of claim filed on 12/2/2009 along with the writ of

summons, the plaintiffs claim against the defendant the following reliefs:

1. A declaration that the defendant was consistently negligent in its

handling of the plaintiffs account transaction.

2. A declaration that the defendants act of not honouring its cheques

presented for payment amounts to breach of banker/customer

relationship.

1
3. A declaration that the act/conduct of the defendant in transferring its

fund to unknown destination unauthorized by the plaintiff amounts

to fraud.

PARTICULARS OF FRAUD

(i) On the 6th of October, 2008, the defendant fraudulently

transferred the sum of N715,500 from its account to an

unknown destination and later returned it on the same date.

(ii) On the same 6th October, 2008, the defendant fraudulently

transferred the sum of N462,825 from its account to an

unknown and unauthorized destination and later on returned

at the close of business on the same day.

(iii) The bank further double charged the plaintiff service charge for

unsolicited services having illegally and unlawfully transferred

funds from the plaintiffs account.

4. The sum of N100,000,000.00 from the defendant jointly and severally

(sic) for breach of contract.

5. The sum of N100,000,000.00 damages for fraud.

6. An order compelling the defendant to reverse and pay to the

plaintiffs the service charges unlawfully and illegally deducted from

its corporate account amounting to N3,756.38.

7. The sum of N100,000,000.00 exemplary and/or aggravated damages

for libel published jointly and severally (sic) by the defendant

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 through cheques dated 15th June, 2007 and 26th September, 2008

respectively, the full text of which are contained in the statement of

claim.

8. An order compelling the defendant to unequivocally retract the said

libellous publication dated the 15th June, 2007 and 26th September,

2008 respectively and apologize to the plaintiffs, for inter alia, the

embarrassment and damage the publications have caused it.

9. Perpetual injunction restraining the defendant by themselves (sic)

their agents, servants and privies from further publication of the

same or similar libel against the plaintiffs.

10. The sum of N100,000,000.00 as general damages.

11. The cost of this suit assessed as N10,000,000.00.

The defendants statement of defence was filed on 13/5/2009, but deemed

to be properly filed and served by order of the Court granted on

21/5/2009. The plaintiffs called three witnesses in proof of their case while

the defendant called one witness.

The 2nd plaintiff, the executive director/chief executive officer of the 1 st

plaintiff, testified as the PW1. He adopted his 43-paragraph statement on

oath filed on 12/2/2009. His evidence is that in 1995, the 1 st plaintiff

opened a current account No. 0042010004877 with the defendant after he

3
had filled an account opening form. He was the sole signatory of the said

account. By letter dated 2/11/2004, the defendant was notified of the

resolution of the board of the 1st plaintiff to the effect that all across the

counter cash transactions above N300,000.00 will require confirmation of

the appropriate authority. As the sole signatory of the account, he issued a

cheque to Mr. Sam Akpe on 15/6/2007 for the sum of N2,400,000.00. On

presentation to the defendant, the cheque was returned unpaid and

marked REP. Before the said cheque was issued, the account had over

N2,700,000.00 credit balance.

On 26/9/2008, he issued another cheque to Messrs Punch Nig. Ltd. for the

sum of N462,825.00. He called the account officer, Helen Okocha, for the

defendant to honour the cheque. On presentation by Messrs Punch Nig.

Ltd. for payment, it was endorsed REP and returned unpaid. As at the

time the cheque was issued, the account had over N2,000,000.00. When he

obtained the 1st plaintiffs statement of account from the defendant, he

discovered that the sum of N462,825.00 was fraudulently transferred from

the account on 6/10/2008 and later credited to the account. In addition, the

defendant surcharged the account service charge for fraudulently moving

its funds to unknown destination. The two cheques in issue were crossed.

The volume of their business nose-dived as the news spread that their

cheques were dud cheques as a result of which most of their clients

declined to do business with them.

4
The word REP in the cheques are false and defamatory and referred to,

and were understood to refer to, the plaintiffs as dishonest and lacking in

business integrity. By reason of the said libel, they have been severely

injured in their credit, character, position and standing in the eyes of their

customers. On 10/10/2008, the plaintiffs solicitors wrote a letter to the

defendant on the subject. The PW1 tendered these documents in evidence:

the letter dated 2/11/2004 is Exhibit A; cheque dated 26/9/2008 is Exhibit

B; letter dated 10/10/2008 is Exhibit C; cheque stubs are collectively

Exhibit D; blank cheque in the name of Centuron Nig. Ltd. is Exhibit E; and

the cheque dated 15/6/2007 for N2,400,000.00 is Exhibit F.

Cross examined, the PW1 said he did not have a contract with the

defendant to call it whenever he issued a cheque. His responsibility is to

fund the account and the defendant has a duty to honour his cheques. The

sum of N6,186.22 deducted from the account on 6/10/2008 as service

charges for sums not paid to the payees is the fraud complained of. He

maintained that when the cheques were presented, there were sufficient

funds in the account.

Chief Henry Akpan testified as the PW2 pursuant to a subpoena ad

testificandum dated 13/7/2009, Exhibit G. He stated his qualifications and

experience in banking. His evidence is that a cheque drawn on a bank is

payable on presentation if not crossed while a crossed cheque can only be

honoured if it is paid to an account for clearing. A cheque could be

dishonoured if: it is post-dated; stale; mutilated; defaced; the signature is

5
irregular; the amount in figure is different from the amount in words; it is

stopped; or there is no fund to satisfy its value. REP on a cheque means

represent, which is a polite way of returning a cheque for lack of sufficient

funds. Dishonouring a cheque when there is sufficient fund in the account

mares business relationships, creates disaffection, affects credibility, causes

distrust and may cause death.

The evidence of the PW2 during cross examination is that REP may be

used to have a confirmation of the cheque or where there are some

uncleared effects (funds) due that account. He was asked whether the

return of a cheque could mare relationships in all instances, for example

where the person who issued the cheque explains to the payee the reason

for the dishonour. In answer, he stated that for individuals, explanation

will be sufficient, but for corporate bodies, it will mare the relationship,

although there is a possibility that an explanation may suffice.

In the course of the proceeding, precisely on 30/11/2009, Mrs. Njideka Eso

Meju, a staff of the defendant, attended Court pursuant to a subpoena duces

tecum dated 21/8/2009 to tender the 1st plaintiffs statements of account in

the defendant. The 1st plaintiffs statements of account from 1/5/2007 to

31/7/2007 and from 1/7/2008 to 8/10/2008 were respectively marked

Exhibits H1 & H2. However, by motion on notice No. M/1700/2010 dated

5/2/2010 but filed on 8/2/2010, the plaintiffs sought the leave of the Court

to recall Mrs. Njideka Eso Meju to tender the current, stamped, signed and

proper statements of account of the 1st plaintiff. The application was not
6
opposed; it was accordingly granted by the Court on 10/2/2010. On

20/4/2010, the said statements of account were produced in Court by the

defence counsel, and were received in evidence by consent of both counsel.

The statements of account of the 1st plaintiff from 1/5/2007 to 31/7/2007

and from 1/7/2008 to 8/10/2008 were respectively marked Exhibits J1 &

J2.

The PW3 was Mr. Sam Akpe. He adopted his statement on oath filed on

30/11/2009, which was deemed to be properly filed and served by order of

the Court granted on 12/1/2010. His evidence is that on 15/6/2007, the 1 st

plaintiff issued a cheque in his name for N2,400,000.00 being cost of the

contract he executed for it. On presentation of the cheque, the defendant

refused to pay him and endorsed REP on it. He called the 2nd plaintiff to

complain of the non-payment. The 2nd plaintiff apologised and asked him

to return the cheque. He returned it and the 2nd plaintiff paid him cash.

Cross examined, Mr. Akpe said he has not done business with the 1 st

plaintiff since the issue of the said cheque. He explained that he paid the

cheque into his account in Guaranty Trust Bank. After about one week, he

went to withdraw money and he was informed that the cheque he paid in

did not clear.

After the evidence of the PW3, the plaintiffs closed their case. Let me pause

to remark that in compliance with the provisions of Order 23 rule 2(1)(b) of

the Rules of this Court, the defendant filed the witness statements on oath

of Helen Okocha, Olubunmi Godo and Ebow Smith along with the

7
statement of defence. None of these persons testified. These statements on

oath are deemed abandoned and cannot be used by the Court.

Bulus Ayuba, a banker of 16 years experience and a staff of Platinum Habib

Bank Plc. (Bank PHB), testified as the DW1 pursuant to a subpoena ad

testificandum dated 5/7/2010 issued to the Zonal Service Leader of Bank

PHB, Adetokunbo Ademola Crescent, Abuja. His evidence is that REP

(i.e. represent) in banking means the beneficiary of the cheque should

present it again. Instances where a bank could ask the beneficiary to

represent a cheque include: where a customer requires his cheque to be

double-confirmed; where the customer has uncleared effect; or where the

customer requests the bank to ask the beneficiary to represent the cheque.

The bank does not have an obligation to disclose the reason for the request

to represent a cheque. By Central Bank regulations, when an account is not

funded, the words to use are Drawers Attention Required (DAR) or Refer

to Drawer (R/D). REP will not connote that an account is not funded.

During cross examination, Mr. Ayuba stated that Exhibits B & F are

clearing cheques. For a clearing cheque to be honoured, the paramount

factors are that the cheque came from the customer and that there is

sufficient fund in the account. Where an account holder issues a cheque to

someone and it is not honoured, it may have an effect on his integrity or

reputation. A customer can elect to waive the confirmation of his cheques.

The process of clearing will not be inconsistent with the mandate of the

customer, but if the amount involved is large, the bank is expected to

8
exercise due diligence in paying. In that case, the bank will clarify from the

account holder whether to honour the cheque or not.

At the conclusion of trial, the parties filed and exchanged their final

addresses in accordance with Order 36 of the Rules of this Court. Dindam

D. Killi Esq. filed the defendants final address on 22/2/2011. Offonmbuk

C. Akpabio (Mrs.) filed the plaintiffs final address on 6/4/2011. On

11/4/2011, Mr. Killi filed a reply on points of law. On 10/5/2011, Ben

Akpan Esq. adopted the final addresses of the defendants, while Abubakar

Al-ameen Esq. adopted the plaintiffs final address.

The defence counsel posed four issues for the determination of the Court,

to wit:

1. Whether the defendant breached the parties banking contract by

failing to honour the 1st plaintiffs cheques and the 1st plaintiff is

therefore entitled to the damages claimed.

2. Whether the defendant libelled the 1st plaintiff by writing REP on

the cheques and therefore the 1st plaintiff is entitled to the reliefs

claimed in that connection.

3. Whether the defendant was negligent in its handling of the 1 st

plaintiffs account.

9
 4. Whether the 1st plaintiff is entitled to the reliefs sought for the

deduction of certain funds from the 1st plaintiffs account and

immediate reversal of the deduction on the very same date.

On the other hand, the plaintiffs counsel adopted issues 1, 2 & 3

formulated by the defence counsel save to substitute 1st plaintiff with

plaintiffs. The learned plaintiffs counsel formulated one other issue, i.e.

issue 4. It reads:

Whether the unauthorized transfer of funds out of plaintiffs account,

illegal deduction and unreversed service charges made on the

account are wrongful and fraudulent.

The case of the plaintiffs, as I understand it, is anchored on two main facts.

The first is that the defendant failed or refused to honour the cheques,

Exhibits B & F, and inscribed REP on them. The second is that the

defendant transferred funds from the account of the 1st plaintiff without the

authority or consent of the plaintiffs and debited the account for service

charge for the said unauthorized transfer of funds. In my considered

opinion, these five issues call for determination in this litigation:

1. Did the defendant breach its banking contract with the 1 st plaintiff by

failing or refusing to honour the cheques, Exhibits B & F?

2. Whether the inscription of REP on Exhibits B & F by the defendant

was libellous of the plaintiffs.

10
 3. Whether the plaintiffs have established that the defendant was

negligent in handling the 1st plaintiffs account.

4. Whether the plaintiffs have proved the allegation of fraud made

against the defendant.

5. Are the plaintiffs entitled to their claims?

ISSUE 1

Did the defendant breach its banking contract with the 1 st plaintif

by failing or refusing to honour the cheques, Exhibits B & F?

The first point to note is that the banking relationship that gave rise to this

suit was between the 1st plaintiff and the defendant. The corporate current

account number 0042010004877 was opened by the 1st plaintiff in the

defendant. At all times material to this suit, the 2 nd plaintiff acted for and

on behalf of the 1st plaintiff. In other words, the 2nd plaintiff was the agent

of the 1st plaintiff. As rightly stated by both counsel, the relationship

between a banker and its customer is contractual; it is that of debtor and

creditor or principal and agent. See First Bank of Nig. Plc. & Anor. v.

Moba Farms Ltd. & Ors. (2005) 8 NWLR (pt. 928) 492 and Haston (Nig.)

Ltd. v. ACB Plc. (2002) 12 NWLR (pt. 782) 623. Therefore, there was a

contractual relationship between the 1st plaintiff and the defendant.

11
In Dike v. African Continental Bank Ltd. (2000) 5 NWLR (pt. 657) 441, the

position of the law was restated that the onus is on the plaintiff suing on a

dishonoured cheque to show that at the time the cheque was presented, he

had sufficient funds in his account. Thereafter, the onus shifts to the bank

to show that there was legal impediment to justify the dishonour of the

cheque. In this case, it is clear from the statements of account of the 1 st

plaintiff, Exhibits J1 & J2, that when the cheques, Exhibits B & F, were

issued, the 1st plaintiff had funds above the sums endorsed on the cheques.

In paragraph 7 of the statement of defence, it is averred that the plaintiff

did not provide confirmation for all the cheque transactions referred to in the

Statement of Claim. However, no evidence was adduced in support of this

averment, therefore it is deemed abandoned. See the case of Agballah v.

Chime (2009) 1 NWLR (pt. 1122) 373. Although the PW2 and DW1 stated

the circumstances that may warrant the dishonour of a cheque and the

inscription of REP thereon, there is no evidence before the Court to justify

the dishonour of the two cheques, Exhibits B & F.

A banker has a duty to honour a cheque drawn on it by its customer who

has sufficient funds with the bank to cover the amount endorsed on the

cheque. Where a bank fails or neglects to pay a customers cheque, such a

failure or neglect constitutes a breach of contract and would render the

banker liable in damages. See Salami v. Savannah Bank of Nig. Ltd. (1990)

2 NWLR (pt. 130) 106 and Afribank (Nig.) Plc. v. A. I. Investment Ltd.

(2002) 7 NWLR (pt. 765) 40. Mr. Killi conceded that there was sufficient

fund in the 1st plaintiffs account and that there was a breach of the contract
12
by the defendant. I hold that the defendant breached its contract with the

1st plaintiff when it failed or refused to honour the cheques, Exhibits B & F.

The damages to be awarded to the plaintiff for the said breach will be

considered later under issue 5.

ISSUE 2

Whether the inscription of REP on Exhibits B & F by the defendant

was libellous of the plaintifs.

The learned counsel for the defendant posited that whether the words

complained of are defamatory in their natural or ordinary meaning is a

question of fact, and it is the effect the words have on persons who read

them that constitutes libel. He referred to Z. P. Industries Ltd. v. Samotech

Ltd. (2007) 16 NWLR (pt. 1060) 315 and Otop v. Ekong (2006) 9 NWLR (pt.

986) 533. He argued that the PW3 did not say that he understood REP as

defamatory or that it lowered the reputation of the plaintiffs before him.

Mr. Killi further noted that the PW3 did not say that he has chosen not to

do business with the plaintiffs on account of the cheque, Exhibit F, that was

returned unpaid and marked REP.

On the other hand, Mrs. Akpabio argued on behalf of the plaintiffs that the

ordinary meaning of REP and the refusal to honour the cheques attack

the integrity of the plaintiffs in the eyes of a third party. It was further

argued that REP reduces the plaintiffs and destroys their financial credit.

It carries a defamatory imputation and tends to lower the plaintiffs in the

13
estimation of right thinking members of the society generally and to expose

them to hatred, contempt or ridicule. Plaintiffs counsel concluded that

REP written on the cheques was libellous of the plaintiffs, pointing out

that libel is actionable per se and does not require prove of actual damage.

Now, a defamatory statement is one which has the tendency to injure the

reputation of the person to whom it refers, and tends to lower him in the

estimation of right thinking members of the society generally and in

particular, to cause him to be regarded with feelings of hatred, contempt,

ridicule, fear, disdain and disesteem. See the cases of National Electric

Power Authority v. Chief Etim Inameti (2002) 11 NWLR (pt. 778) 397 and

Alawiye v. Ogunsanya (2004) 4 NWLR (pt. 864) 486. A defamatory

statement may be in writing or by spoken words. The former is libel while

the latter is slander. In Anate v. Sanusi (2001) 1 NWLR (pt. 725) 542, the

ingredients of the tort of libel were itemised thus:

(a) The defendant published in a permanent form a false statement.

(b) The statement refers to the plaintiff.

(c) The statement conveys a defamatory meaning.

(d) The statement is defamatory of the plaintiff in the sense that:

(i) it lowered him in the estimation of right thinking members of

the society; or
(ii) it exposed him to hatred, ridicule or contempt; or
(iii) it injured his reputation in his office, trade or profession; or
(iv) it injured his financial credit.

14
Failure of the plaintiff to establish any of the ingredients or elements will

automatically result in the failure of the action.

One issue worthy of attention in this matter is whether REP is capable of

conveying a defamatory meaning. In Standard Trust Bank Ltd. v. Barrister

Ezenwa Anumnu (2008) 14 NWLR (pt. 1106) 125, the plaintiff was a

customer of the defendant and operated a current account in the name of

his legal firm, Joint Heirs Chambers. There was a credit balance of

N607,954.77 in the account. He issued a cheque on the account for the sum

of N601,000.00 to one of his major clients at the time, Mr. Bimbo Oguntade.

When Mr. Oguntade presented the cheque for payment, it was returned

unpaid and marked DCR meaning drawer confirmation required. The

learned trial Judge held inter alia that DCR was libellous. Dissatisfied, the

defendant appealed to the Court of Appeal. In a unanimous decision, the

Court of Appeal dismissed the appeal. Delivering the leading judgment,

his lordship, Olufunlola Oyelola Adekeye, JCA (as he then was) held at pages

156-157, paragraphs G-D as follows:

The third issue for consideration by this court is the findings of the

learned trial Judge that the term Drawer Confirmation Required,

Drawer Attention Required and Refer to Drawer mean the same

thing.

In the interpretation of these words, I shall prefer to adopt the

meaning attached to them in decided cases

15
 The words refer to drawer have been interpreted to amount to a

statement by the bank that we are not paying go back to the

drawer and ask why or else go back to the drawer and ask him to

pay. Dike v. ACB Ltd. (2000) 5 NWLR (pt. 657) 458.

Drawer Attention Required which expression connotes non-

availability of funds in the customers account which will equally be

wrongful and defamatory to return a cheque so marked if the

customer has adequate funds in the account.

Drawer Confirmation Required may be interpreted to mean let the

customer confirm if he is ready to take on extra debit or

indebtedness in his account. It may signify that the level of his debit

balance can no longer be tolerated ... I agree with the reasoning of

the learned trial Judge that Drawer Confirmation Required,

Drawer Attention Required and Refer to Drawer mean the same

thing in banking operations as they are warnings to dishonouring a

cheque. A cheque is returned unpaid after being so marked.

The connotation to a third party is that there is no fund or no

sufficient fund in the account to accommodate the dishonoured

cheque.

In line with the above decision, it is my respectful view that REP written

on a dishonoured cheque, as in the instant case, carries the same

connotation as Drawer Confirmation Required, Drawer Attention Required

and Refer to Drawer. I accept the evidence of the PW2 that REP when
16
written on a cheque is a polite way of returning a cheque for lack of

sufficient funds. Therefore, the decision of the Court is that when a cheque

is dishonoured and REP written on it, it is capable of conveying a

defamatory meaning.

The next important issue is whether there is any evidence that REP

written on the cheques, Exhibits B & F, was defamatory of the plaintiffs.

This is because to succeed in a libel suit, it is not enough for the words to be

capable of conveying a defamatory meaning. There must be evidence that

the words were defamatory of the plaintiff in that they lowered him in the

estimation of right thinking members of the society, or exposed him to

hatred, ridicule or contempt, or injured his reputation or financial credit. It

is the effect the words have on persons who read them that constitutes

libel.

In Lambert Sunday Iwueke v. Imo Broadcasting Corporation (2005) 17

NWLR (pt. 955) 447, the Supreme Court held that for a plaintiff to succeed

in libel, there must be proof by evidence of a third party of the effect of the

alleged publication on him i.e. the reaction of a third party to the

publication complained of. It was further held that a persons reputation is

not based on the good opinion he has of himself, but the estimation in

which others hold him. Also in Bank of the North Ltd. v. Alhaji A. A.

Adehi (2003) FWLR (pt. 137) 1135, it was held that in a case of defamation

of character, the plaintiff must call witnesses to testify as to what they think

17
and feel about him since the publication of the alleged defamatory matter.

See also the case of Z. P. Industries Ltd. v. Samotech Ltd. (supra).

In paragraphs 27, 30, 31 & 32 of the statement of claim, the plaintiffs

averred that the refusal of the defendant to honour the cheques portrayed

them as fraudsters before their reputable customers; that some persons

started making calls insinuating and carrying innuendoes concerning their

integrity and reputation; that the endorsement of REP in the said cheques

by the defendant was defamatory and were understood to refer to them as

dishonest and lacking business integrity. Mr. Sam Akpe testified as the

PW3, but did not give any evidence to suggest that the return of the

cheque, Exhibit F, with the inscription REP lowered the plaintiffs in his

estimation or made him to treat them with hatred, ridicule or contempt or

injured their reputation or financial credit.

In her effort to persuade the Court to reach a finding that the plaintiffs have

established this ingredient, the plaintiffs counsel referred to paragraphs 7,

8 & 9 of the statement on oath of PW3 and submitted:

A cursory look at the above three paragraphs will reveal the bad and

disappointed feelings of the PW3 for which the 2 nd plaintiff had to render an

apology which ordinarily would have been unnecessary if the cheque was

honoured ab initio.

In the circumstance of the inscription of Rep and refusal to honour the said

cheque indisputably conveys a defamatory imputation to the effect that the

18
 plaintiff has no money but decided to falsely issue the cheque and as such he

is of no financial credit.

In paragraphs 7, 8 & 9 of his statement on oath, the PW3 stated: that the

defendant endorsed REP on the cheque before returning same to him;

that he in turn called the 1st plaintiffs executive director (2nd plaintiff) to

complain of non-payment by the defendant of the cheque; and that the 2 nd

plaintiff apologized on behalf of the 1st plaintiff and asked him to return the

cheque which he did. With profound respect, the above depositions of the

PW3 do not convey a defamatory imputation to the effect that the plaintiff has

no money but decided to falsely issue the cheque and as such he is of no financial

credit as argued by the plaintiffs counsel. In fact, the evidence of the PW3

in paragraph 10 thereof that on returning the cheque to the plaintiffs, the

2nd plaintiff paid him cash of N2,400,000.00 negates any suggestion or

inference that the inscription of REP on the cheque conveyed a

defamatory imputation that the plaintiffs had no money but decided to

falsely issue the cheque.

In paragraph 35 of the statement of claim, the plaintiffs averred that the

defendant published the said libellous material on 26/9/2008 to the staff

and management of Messrs Punch Nigeria Limited. The plaintiffs did not

call any witness from Messrs Punch Nigeria Limited to state the effect, if

any, the return of the cheque, Exhibit B, and the inscription of REP

thereon had on him. In these circumstances, it is my considered view that

there is no evidence before the Court to show that the inscription of REP
19
on the cheques, Exhibits B & F was defamatory of the plaintiffs in that it

lowered them in the estimation of right thinking members of the society, or

exposed them to hatred, ridicule or contempt, or injured their reputation or

financial credit. The inevitable decision I must reach is that the plaintiffs

have failed to prove the ingredients of the tort of libel and the claim for

libel must fail.

ISSUE 3

Whether the plaintifs have established that the defendant was

negligent in handling the 1st plaintifs account.

The defence counsel referred to the evidence of the DW1 on the reasons

that could make a bank to request a customer to represent a cheque, and

argued that a banker who returns a cheque for any of these reasons cannot

be said to be negligent in its handling of the customers account. According

to Mr. Killi, the act in itself seeks to protect the customers fund with the

banker. He submitted that the plaintiffs have not shown that the account

was compromised. On the other hand, Mrs. Akpabio argued that the

defendant was negligent in the way and manner it treated the account and

transactions of the plaintiffs because it did not exercise the standard of care

expected. It was submitted that by virtue of Exhibit A, the defendant was

negligent when it refused to honour the said cheques.

Negligence in law means the omission to do something which a reasonable

man guided upon the consideration which ordinarily regulates the conduct

20
of human affairs would do or doing something which a prudent and

reasonable man would not do. What amounts to negligence depends on the

facts of each particular case. See First Bank of Nigeria Plc. v. Ibennah

(1996) 5 NWLR (pt. 451) 746. Negligence as a tort may be described as the

breach of a duty to take care imposed by common law or statute, resulting

in damage to the plaintiff. Before liability to pay damages for the tort of

negligence can be established, the plaintiff must prove that: the defendant

owed him a duty to exercise due care; the defendant failed to exercise due

care; and the defendants failure to exercise due care was the cause of the

injury to the plaintiff. See the case of Osigwe v. Unipetrol (2005) 5 NWLR

(pt. 918) 261.

There can be no doubt that by virtue of the contractual relationship

between a banker and its customer, the banker owes its customer a duty of

care. In Mr. Emmanuel Agbanelo v. Union Bank of Nig. Ltd. (2000) 7

NWLR (pt. 666) 534, it was held that a bank has a duty under its contract

with its customer to exercise reasonable care and skill in carrying out its

part with regard to operations within its contract with the customer. The

duty to exercise reasonable care and skill extends over the whole range of

banking business within the contract with the customer. In the instant case,

I hold that the defendant owed the 1 st plaintiff a duty to exercise due care

and diligence in dealing with the account.

On whether the defendant breached the duty of care owed the 1 st plaintiff, I

had found that the defendant did not show any justification for
21
dishonouring the said cheques. I agree with the plaintiffs counsel that

instead of dishonouring the cheques, the defendant should have called the

plaintiffs if it needed to clear any doubt. I have also taken into account the

unchallenged evidence of the PW1 that he called the account officer, Helen

Okocha, for the defendant to honour the cheque, Exhibit B. The decision of

the Court is that the defendant breached its duty of care in that it failed to

do what a reasonable banker would have done in the circumstances.

It remains to determine whether the plaintiffs have proved the third

ingredient of the tort of negligence i.e. proof that they suffered damage as a

result of the defendants breach of duty of care. In Thomas Chukwuma

Makwe v. Chief Obanua Nwukor (2001) 14 NWLR (pt. 733) 356, the

Supreme Court held that there can be no action in negligence unless there

is damage. Negligence is only actionable if actual damage is proved. Thus,

negligence alone does not give a cause of action; damage alone does not

also give a cause of action. The two must co-exist. In paragraph 28 of the

statement of claim it is averred that the volume of its business nose-dived as

the news spread that its cheques were dud cheques that was (sic) not worth the

paper it was (sic) printed on and as a result of which most of its clients declined

doing business with it.

The plaintiffs counsel referred to the evidence of the PW3 under cross

examination that he has not done business with the plaintiffs since the

issue of the cheque and argued that this piece of evidence supports the

evidence of the PW1 that his business has collapsed due to the acts of the

defendant on the account. In my view, this piece of evidence of the PW3 is

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not proof of damage, more so the PW3 did not say he has not done

business with the plaintiffs because Exhibit F was dishonoured. I am also

not persuaded by the view of Mrs. Akpabio that the plaintiffs are persons

in business and the law imputes injury on them even without pleading or

proving actual damage. What the law requires is proof of actual damage. I

agree with the defence counsel that the plaintiffs have not proved that they

suffered any loss as a result of REP written on the cheques.

The plaintiffs counsel also pointed out that by the evidence of the PW2 &

DW1, the effect of a bank dishonouring a cheque could be devastating to

the business and life of the customer. Mrs. Akpabio also posited that the

negligent conduct of the defendant has caused the plaintiff to suffer in the thinking

and believe (sic) of their customer that the plaintiffs have no financial credit and

have refused as a result to do further business with the plaintiffs. Unfortunately,

neither the evidence of the PW2 & DW1 nor the above submission of

learned counsel is helpful to the plaintiffs on the issue under focus i.e.

proof that they suffered loss or damage as a result of the defendants

breach of duty. Apart from the ipse dixit of the PW1, there is nothing before

the Court to prove the allegation that the plaintiffs business nose-dived as

a result of the dishonour of the cheques. If I may be prolix, negligence is

only actionable if actual damage is proved by the plaintiff. In the absence of

cogent or credible evidence of actual damage suffered by the plaintiffs as a

result of the dishonour of the cheques, I hold that the plaintiffs have not

proved the tort of negligence.

ISSUE 4
23
 Whether the plaintifs have proved the allegation of fraud made

against the defendant.

In S. O. Ntuks & Ors. v. Nigerian Ports Authority (2007) 13 NWLR (pt.

1051) 392, fraud was defined as an intentional perversion of truth for the

purpose of inducing another in reliance upon it to part with some valuable

things belonging to him or to surrender a legal right. It is a false

representation of a matter of fact, whether by words or by conduct, by false

or misleading allegations or by concealment of that which should have

been disclosed, which deceives and is intended to deceive another so that

he shall act upon it to his legal injury.

The defence counsel pointed out that money transferred from the 1 st

plaintiffs account was returned the same date. He submitted that this does

not qualify as fraud, otherwise the money would not have been returned.

According to him, what happened was merely an erroneous debiting of the

account which was rectified by the defendant. On the other hand, the

plaintiffs counsel argued that if not for the intention to gain undeserved

profit or advantage the defendant should not have transferred funds out of

the plaintiffs account without their authority or make unwarranted and

illegal deductions. Mrs. Akpabio stressed that the defendants refusal to

reverse the service charges on the account when asked to do so shows its

intention to unduly enrich itself.

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Now, in paragraph 44(1)(c) of their pleadings, the plaintiffs pleaded the

particulars of fraud. Firstly, that on 6/10/2008, the defendant fraudulently

transferred the sums of N715,500.00 and N462,825.00 from its account to an

unknown destination and later returned it on the same date. Secondly, that

the defendant double charged the plaintiffs service charge for the funds

unlawfully transferred from the account. Fraud is a criminal allegation. By

virtue of section 138(1) of the Evidence Act, if the commission of a crime by

a party to any proceeding is directly in issue in any proceeding, civil or

criminal, it must be proved beyond reasonable doubt. See the case of

Arowolo v. Ifabiyi (2002) 4 NWLR (pt. 757) 356. From the facts before the

Court, it seems to me that what happened was merely a wrongful debiting

of the account which was rectified by the defendant on the same date

without the prompting of the plaintiffs. My considered view is that the

reversal of the transactions by the defendant on the same date negates any

inference that the defendant intended to defraud the 1 st plaintiff. I hold

that the plaintiffs failed to prove the allegation of fraud.

ISSUE 5

Are the plaintifs entitled to their claims?

In the light of the decisions of the Court on issues 1, 2, 3 & 4, it becomes

easy to determine whether the plaintiffs are entitled to their claims. On

relief 1, I adopt my views on issue 3 and refuse the claim for a declaration

that the defendant was consistently negligent in handling the 1 st plaintiffs

account. Reliefs 3 & 5 are hinged on the allegation of fraud. I adopt my

25
views on issue 4. The declaration sought in relief 3 is refused. The claim for

the sum of N100,000,000.00 damages for fraud is dismissed. Reliefs 7, 8 & 9

are respectively for the sum of N100,000,000.00 exemplary and/or

aggravated damages for libel; an order compelling the defendant to retract

the said libellous publication and to apologize to the plaintiffs; and an

order for perpetual injunction. These claims are dismissed, the Court

having found under issue 2 that the plaintiffs failed to prove the tort of

libel.

Relief 10 is for the sum of N100,000,000.00 as general damages. The

plaintiffs suit is for breach of contract, libel, negligence and fraud. The

plaintiffs did not specify the pedestal on which this claim stands. Perhaps it

is the monetary claim for the tort of negligence. Whatever this claim

represents, I think it is tidier to dismiss it now. Accordingly, the claim for

N100,000,000.00 as general damages in paragraph 51 of the statement of

claim is dismissed.

Relief 2 is a declaration that the defendants act of not honouring the 1 st

plaintiffs cheques, Exhibits B & F, presented for payment amounts to

breach of banker/customer relationship. I adopt my views on issue 1 and

hold that this claim has merit. It is accordingly granted.

Relief 4 is the sum of N100,000,000.00 for breach of contract. The defence

counsel conceded that the 1st plaintiff is entitled to general damages for the

breach of contract by the defendant. The issue that calls for determination

is the quantum of damages. As rightly stated by both counsel, in awarding

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damages for breach of banker/customer relationship as it relates to

dishonouring of cheques, the courts have made a distinction between a

trading and non-trading customer. For the former, the amount to be

awarded is substantial, but for the latter, the amount is nominal except the

customer pleads and proves special damages. See FBN Plc. v. Ibennah

(supra) and Access Bank Plc. v. Maryland Finance Co. & Consultancy

Service (2005) 3 NWLR (pt. 913) 460.

The standpoint of Mr. Killi is that the 1 st plaintiff is entitled to nominal

damages because there is no pleading that it is a trader and there was no

pleading of special damages or proof thereof. On the other hand, Mrs.

Akpabio submitted that the plaintiffs are persons in business and are

therefore entitled to substantial damages without pleading or proving

actual damage. Learned counsel for the plaintiffs pointed out that the

account in issue is a corporate account and the cheques dishonoured were

meant for the payment of business transactions.

In paragraph 3 of the statement of claim, it is averred inter alia that the 1st

plaintiff engages in multidisciplinary practice, consultancy and general

contracts. Also in paragraph 5 therefore, it is averred that the 1 st plaintiff

opened a corporate current account in the defendant for the purposes of

enhancing its financial transactions and smooth business deals within the

country. In paragraph 3 of its defence, the defendant merely denied

paragraph 3 of the statement of claim, but in paragraph 4 thereof, it

admitted paragraph 5 of the plaintiffs pleadings. From the state of the

27
pleadings, it is clear, at least to me, that the defendant did not dispute the

fact that the 1st plaintiff is a person in business. It is also not in dispute that

the said cheques were issued by the 1 st plaintiff for its business transactions

respectively with Messrs Punch Nigeria Limited and Mr. Sam Akpe. For

these reasons, I hold that the 1st plaintiff is a person in business or a trading

customer, and therefore entitled to substantial damages.

What amount will be substantial damages in the circumstances of this

case? The court would refuse to grant an exaggerated and oppressive sum

as general damages. It is therefore an implicit consideration for the award

of general damages that the amount awarded by the court must be

reasonable in the particular circumstances of each case. See R.C.C. (Nig.)

Ltd. v. R.P.C. Ltd. (2005) 19 NWLR (pt. 934) 615. In Access Bank Plc. v.

Maryland Finance Co. and Consultancy Service (supra), the Court of

Appeal advised courts not to be carried away in making award of damages.

The court must not allow its mind to be affected by any high-sounding

figure of money claimed, like the sum of N100,000,000.00 in the instant

case. The court must look at the whole case dispassionately and let its

award be a proper and sober assessment of the entire case. Having made a

dispassionate and sober assessment of this case, I award the sum of

N2,000,000.00 to the 1st plaintiff as general damages for breach of contract.

In relief 6, the plaintiffs claim an order for the defendant to reverse and pay

the sum of N3,756.38 unlawfully deducted as service charges from the

account. The statement of account of the 1 st plaintiff, Exhibit J2, indicates

28
that the sum of N6,186.22 was deducted as service charges on 6/10/2008

(made up of 4 deductions of N2,314.13, N115.71, N3,577.50 & N178.88). The

defendant has neither denied nor justified these service charges. The

learned defence counsel stated that assuming that the service charges in

respect of the transactions were not reversed, the plaintiffs are only entitled

to the reversal of such charges. At the trial, the PW1 stated that his claim is

the sum of N6,186.22 as refund of service charges. However, the plaintiffs

did not amend their pleadings to claim N6,186.22 instead of N3,756.38. As

the law stands, the Court can only award the sum claimed in the pleadings

as evidence on a fact not pleaded goes to no issue. See Rabiatu Adebayo &

Ors. v. Rasheed Shogo (2005) 7 NWLR (pt. 925) 467. I hold that the 1st

plaintiff is entitled to the sum of N3,756.38 as refund of service charges.

On the whole, this suit succeeds in part. I enter judgment for the 1 st

plaintiff in these terms:

1. A declaration that the defendants act of not honouring the 1 st

plaintiffs cheques, Exhibits B & F, presented for payment was a

breach of banker/customer relationship.

2. The sum of N2,000,000.00 as general damages for breach of contract.

3. The sum of N3,756.38 as refund of service charges.

4. Cost of N20,000.00.

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 _________________________
HON. JUSTICE S. C. ORIJI
(JUDGE)

Appearances:

1. Ben Akpan Esq. with Chiedozie Okwudili Esq. for the plaintiffs.

2. Miss Safiya Hassan for the defendant.

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