Societe Generale Bank Nigeria Limited V. Litus Torungbenefade Afekoro & Ors. (1999)

LAWGLOBAL HUB Lead Judgment Report

E. OGUNDARE, J.S.C

The Appellant herein as at all times relevant to this case, a banker to the 1st Respondent. Litus Turungbenefade Afekoro who had a Savings Account No. 07112515193 at the Bank. Sometime in 1986, Chief John Ekwuba Muoghalu, chairman/managing director of the 3rd Respondent reported to the police that a sum of seven million Naira (N7,000,000.00) belonging to the 3rd Respondent was stolen by some persons in consequence of which report, police commenced investigations. In the course of police investigations the accounts of Farlob (Nig.) Ltd. and Toyem Enterprises Nigerian Limited both with the Appellant, were frozen and the balances totaling N2,727,655.50 were transferred into a suspense account with the Appellant.

By a letter Ref. No. CR . 3000/X/C/Vol.42/508 dated 18th February, 1999 the Police requested the Appellant “to transfer the amount lodged in the (suspense) account to IMB (International Merchant Bank), Victoria Island, Lagos account of Alliance International (Nigeria) Limited with account No. 12050220. Before carrying out this request the Appellant sought and obtained from the 3rd Respondent an indemnity against claims that might be made on it in respect of the sum of money being transferred into the account of the 3rd Respondent.

Meanwhile, the 1st Respondent attempted to operate his savings account with the Appellant but was told that the account had been frozen on the orders of the police. Thereupon, the 1st Respondent instituted by originating summons, an action (suit No. M/664/89) against the Appellant and the 2nd Respondent claiming:-

“(i) That the directive of the 2nd Defendant to the 1st Defendant contained in the letter reference No. CB/300/X/C/Vol.42/508 dated 18th February, 1988, signed by C.T. Duwon (DCP) (for AIG) for the Director of Investigation and Intelligence, Lagos. Exhibit ‘LTA 5’ attached herewith, addressed to the Defendant/Respondent directing the 1st Defendant to transfer monies in the accounts of Toyem Enterprises (Nig.) Ltd. and Farlob Nig. Ltd., to the account of Alliance International Nig. Ltd. Account No. 120501220 is ultra vires, unconstitutional, illegal and void. The 2nd Defendant has no power and or right to issue such directive.

(ii) That the directive contained in the letter Exhibit LTA 5 attached and referred above giving specific companies accounts Toyem Enterprises Nig Ltd and Farlob Nig. Ltd. as the subject matter of the said letter was not referable to Plaintiff/Applicant’s Private Savings Account Number 07112515193 L.T. Afekoro and any action of the 1st Defendant in transferring the amount from the account to the account of Alliance International Nig. Ltd, is ultra vires, unconstitutional, illegal and void, a breach of the Banking rules and practice and a breach of duty of care existing between Plaintiff and 1st Defendant.

(iii) That the account of the Plaintiff – that is Savings Account No 97112515193 is not affected by the directive contained in the letter reference No. CR/3000/X/C/Vol. 42/508 of 18th February, 1988.

(iv) That the Defendant is bound to act on the directive from Commissioner of Police in the letter reference number CR/3000/X/C/Vol.T2 16 at March 1989. Exhibit LTA 5 herewith wherein that since investigation revealed Plaintiff is not involved in the fraud of seven million Naira and that his account be defrozen.

(v) That the Plaintiff is entitled to operate and or withdraw from his savings Account No. 07112515193 which stood at N487,539.00 as at 16/12/86 as per Exhibit LTA and continue to add interests at the Bank’s rate till today. And for such further or other orders this Honourable Court may deem fit to make in the circumstances.”

In the affidavit in support of the summons, the 1st Respondent deposed, inter alia, thus:

“1. That I became a customer in the Defendant’s Bank in l992 when I opened and commenced operation of a personal Savings Account Number 07112515193 -photocopies of Identity Card issued to me and 1982 State (sic) of Account are attached herewith and marked as Exhibits ‘LTA 1 and LTA 1a’

2. That in the course of the operation of the Savings account, I paid on the 27/3/86 a sum of N487,500 photocopy of the teller is attached herewith and marked Exhibit ‘LTA 2’
3. That the sum of N487,500 deposited on 27/3/86 in my account referred to in paragraph 2 above was part of the profit due to me on a business transaction with the following persons namely Chief John Muoghalu, Godfrey, Uyi Alemezonu, Alhaji Imam, Dayo and myself.
4. That the business venture yielded a profit of a total sum of fourteen (14) million Naira.
5. That Chief Muoghalu, the Principal Business Partner took Seven Million Naira and handed over Seven Million Naira to Godfrey Uyi Alemezonu to be distributed amongst us namely Godfrey Uyi Alemozonu, Alhaji Imam, Dayo and myself.
6. That in the course of such distribution, Alhaji Imam was given four million Naira which was paid to his Lobi Bank – Ikeja Branch account. Draft of N600,000 paid to Dayo’s account with First Bank of Nigeria Ltd and in addition cash of N125,000, a sum of N487,500 was paid to my Savings Account number 07112515193 as shown on Exhibit ‘LTA2’. The remaining amount was in Godfrey Uyi Alemozonu’s account with the Defendant’s Bank.
7. That Godfrey Uyi Alemozonu was a former Senior Bank Officer in the Defendant’s Bank and his share of the transaction amounting to One Million Nine Hundred and Thirteen Thousand Naira was paid to defendant’s Banks in the name of the Companies, Toyem Enterprises Nigeria Ltd. and Farlob Nigeria Ltd.
8. That sometimes around July/August 1986 while attempting to withdraw from my Savings Account 07112515193, the assistant Manager in the Savings Department of the Defendants Bank informed me and I believe him that the Assistant inspector General of Police has instructed them to freeze the account pending investigation.
9. That the Assistant Manager in the Savings Department at the Defendants Bank (Mr. Bruce) told me in the presence of my Solicitor (N.A.B. Animashaun) that my account was frozen from July 1986 because the directive contained in a letter reference No. CR.300/X/T/ADMN/177 dated 2nd July 1986, subject matter L.T. Afekuro Savings Account Number 07112515193 to be suspended on account of investigation of fraud of seven million Naira but failed to make a copy available to us.
10. That the Assistant Manager (Mr. Bruce) also informed me and my Solicitor of the letter reference number CR.300/X/C/Vol.42/508 cited 18th February 1988 and handed a photocopy to us. The photocopy is attached herewith and marked Exhibit ‘LTA 5’.
11. That the Assistant Manager (Mr. Bruce) in the Defendants Bank further told both myself and my Solicitor that the Bank had acted in compliance with the directive contained in the letter referred to in paragraph 17 and exhibited as ‘LTA 5’.
12. The Assistant Manager (Mr. Bruce) later told us that except a specific letter comes from the Police Office defreezing my suspended account; there was nothing the Defendants Bank could do.”
13. That the Commissioner of Police investigation Department forwarded a letter reference number CR.3000/X/C/Vol.1 T2/16 of 31st March, 1989 to the Manager of the Defendants Bank to allow me operate my account as I have been found not to have been involved in the said fraud after completion of Police investigation – photocopy of the letter is attached herewith and marked Exhibit LTA 7.
14. That I was never arrested nor detained and was never interrogated or tried in any Court as regards any charge of conspiracy and or stealing and or fraudulent acquisition of the sum of N487,500.00″. A number of documents were attached to this affidavit, among which were Exhibits LTA5 – a letter dated 18th February, 1988 addressed to the Appellant by the police and signed by C.T. Duwon, DCP, LTA6 written by the 1st Respondent to the police requesting that his account be defrozen and LTA7 written by the police to the Appellant and dated 31st March, 1999 de-freezing 1st Respondent’s account. I shall say more on Exhibits LTA5 and LTA7 in the course of this judgment.

The 2nd Respondent filed a counter-affidavit in which one Jacob Ademuyiwa Assistant Superintendent of Police at the Federal Investigation and Intelligence Bureau, Alagbon Close, Lagos deposed:

“2. That I was in the team of officers who investigated this case.

7. That Chief John Muoghalu reported to the Police that 4 (sic) men namely Alhaji Yakubu Iman, Godfrey Uyi Alemezohu, and George Dayo had conspired to defraud him of the sum of 7 million Naira.
8. That investigation revealed that the said 3 men (namely Alhaji Yakubu Iman, Godfrey Uyi Alemezonu. George Dayo) had obtained the sum of 7 million Naira from Him (complainant) on the pre that they would open a letter of credit for Mr. John Muoghalu for the importation of tobacco leaves.
9. That the sum of 7 million Naira was paid by the complainant to the said 3 men syndicate as follows:

(a) Cooperative and Commerce Bank Drafts Nos. 040057 dated 3/3/86 for N40.000.00 AO 038589 dated 19/2/86 to N1,160,000.00 and No. 040056 dated 3/3/89 for N2,000,000.00 in favour of Yoyem Enterprises Nig. Ltd. The above mentioned bank drafts are marked exhibits A1, A2 and A3 respectively.