John Orekie Anyakwo V. African Continental Bank Ltd. (1976)

LawGlobal-Hub Lead Judgment Report

FATAYI-WILLIAMS, J.S.C.

The plaintiffs, now respondents, are a commercial bank with their registered office in Lagos. The defendant, now appellant, is a customer of the plaintiffs and maintains a current account at the Martins Street Branch of the plaintiffs.In the proceedings which they commenced in the High Court of Lagos State, the plaintiffs, as bankers, claimed against the defendant the sum of 67,883.5.3Pounds being money lent by them to the defendant at interest at the defendant’s request.

The said sum represented the amount outstanding in the defendant’s current account as debit balance.  The plaintiffs also claimed interest at the rate of 9% from the date of the issue of the writ until judgment or until payment is made.The claim was originally filed as “undefended” but the defendant, within the time prescribed in Order 3 rule 11 of the old Supreme Court (Civil Procedure) Rules, gave due notice of his intention to defend the action.  Pursuant to this, pleadings were ordered and duly delivered.

Paragraphs 4, 5, 6, 7, 8 and 9 of the plaintiffs’ Statement of Claim read: –
“4.    That at the defendant’s request various letters of credit were opened between 1971-1972 by the plaintiff for the defendant’s benefit for the purpose of cement trade in these stages to wit, viz: –

(a)   1st Letter of Credit – 210,00 U.S.A. dollars equivalent to 71,428.11.5d

(b)   2nd Letter of Credit revolving four times to U.S.A. dollars amounting to U.S.A. dollars 105,000 equivalent to 3357,142.17.10d.

5.      That these Letters of Credit were valid for the operational use of the defendant for the said cement trade and expired on 31st day of March, 1972.

6.      That the actual amount utilised by the defendant from the said letter of credit is 224,700.00 U.S.A. dollars which is equivalent to 376,428.11.5d before the said Letters of Credit came to an end on the said 31st day of March, 1972.

7.      That on the arrival of the cement, custom duties, handling charges, bank charges and storage charges made the defendant’s account come up to 3143,313.13.0d (One Hundred and Forty Three Thousand Three Hundred and Thirteen Pounds Thirteen Shillings only).

8.      That after the sale of the cement the whole amount derived from the sale in favour of the defendant and which amount was credited to the said defendant was 375,717.19.0d (Seventy Five Thousand Seven Hundred and Seventeen Pounds Nineteen Shillings) thus leaving a debit balance of 367,883.5.3d (Sixty Seven Thousand Eight Hundred and Eighty Three Pounds Five Shillings and Three Pence only) against the defendant.

9.      That the defendant’s debit account balance after the completion of the said transaction now stands at 67,883.5.3d (Sixty Seven Thousand Eight Hundred and Eighty Three Pounds Five Shillings and Three Pence only) and for which sum of money the defendant is still indebted to the plaintiff and has not repaid the said plaintiff despite several demands to do so.”

The defendant denied all the above averments in paragraph 3 of his Amended Statement of Defence and put the plaintiffs to the strict proof of the various allegations contained therein.  He averred further in paragraph 4 theroef as follows: –

“4.    As to paragraphs 3, 4, 5 and 6 of the Statement of Claim, the defendant avers that only one Irrevocable Letter of Credit No. LA. 72/71/HQ167.71 for 50,000 Metric tons of cement was opened by the plaintiff in favour of the defendant. The said Irrevocable Letter of Credit was to revolve four times which is for shipment of cement.”

In addition, the defendant sought to set-off against the plaintiffs’ claim the following amounts: –