Chief Belonwu Ugochukwu Vs Cooperative & Commerce Bank (Nigeria) Ltd (1996)

LAWGLOBAL HUB Lead Judgment Report

KUTIGI, JSC.

By paragraph 22 of his Amended Statement of Claim the plaintiff claimed against the defendant as follows:-

“A. Declaration that the Deed of Legal Mortgage purportedly made between the plaintiffs as Mortgagor end the defendant as Mortgagee registered as No. 39 at page 39 in volume 208 of the Land Registry in the office at Owerri is otiose, null and void or in any event unenforceable against the plaintiff’s property at No. 239 Cameroun Road Aba.

B. An injunction perpetually restraining the defendant by itself or through privies acting on its behalf from exercising any rights pursuant to the said mortgage by way of sale or otherwise of the plaintiff’s property known as No. 239 Cameroun Road, Aba.

C. Declaration that upon a proper account taken, the plaintiff is not owing the defendant the sum of N1, 047,249.00 as claimed by the defendant in its letter of the 22nd of July, 1988 addressed to the plaintiff.

D. The sum of N73, 217.54 being refund due to the plaintiff on account of cancelled letters of credit and excess debit on Letters of Credits processed by the defendants as plaintiff’s bankers on behalf of the plaintiff.

E. The sum of N4, 625,604.77 less any sum which the defendant may prove or which the Court may find due to the defendant arising from its loan or other charges against the plaintiff.”

After the filing and exchange of pleadings the case proceeded to trial. At the hearing the plaintiff gave evidence for himself while, one witness testified on behalf of the defendant bank.

The facts are quite simple. The plaintiff was a good customer of the defendant for many years who enjoyed overdraft and loan facilities amongst others. The plaintiff used the facilities to import goods from overseas and the defendant would raise Letters of Credit on behalf of the plaintiff in favour of the plaintiff’s overseas customers. It was also the practice for the defendant to debit plaintiff’s account with amount in excess of the invoice value of any consignment with the understanding that when the Bill of Exchange was raised in favour of the overseas customers, any balance not utilizes in the remittance was credited to the plaintiff as a refund. In aid of the above arrangement, the defendant sometime in 1978, granted the plaintiff at the plaintiff’s request, an overdraft or loan facility of N30, 000.00 at a fixed interest rate of 9 per centum per annum secured by a mortgage of the plaintiffs property at No. 239 Cameroun Road, Aba. The defendant realizing in 1988 that the plaintiff was owing it N1, 047,249.00 and that he was not repaying the loan, informed him of its intention to exercise its right under the Mortgage Deed to sell the plaintiff’s property at No. 239 Cameroun Road, Aba.

This prompted the plaintiff to file the suit claiming the reliefs set out above,

At the end of the trial, the learned trial judge gave judgment in favour of the plaintiff when he concluded on pages 109 – 110 of the record thus –

“(i) It is hereby declared that the Deed of Legal Mortgage, purportedly made between the plaintiff, as mortgagor, and the defendant, as mortgagee, registered as No. 99 at page 39 volume 208 of the Land Registry in the office at Owerri, is otiose, null and void and unenforceable against the plaintiff’s property at No. 239 Cameroun Road, Abe, registered as No. 26 at page 26 in volume 751 of the Lands Registry in the office at Enugu now Owerri.

(ii) The defendant, by itself or through privies acting on its behalf, is hereby restrained perpetually from exercising any rights pursuant to the said mortgage by way of sale or other wise of the plaintiff’s property known as No. 239 Cameroun Road, Aba.

(iii) It is hereby declared that the plaintiff is not owing the defendant the sum of N1, 047,249.00 or, subject to this judgment, any amount at all.