Thomas Chukwuma Makwe V Chief Obanua Nwukor (2001)

LAWGLOBAL HUB Lead Judgment Report

I. IGUH, JSC.

The proceeding leading to this appeal was first initiated on the 18th day of March, 1988 in the High Court of Justice of the former Bendel State of Nigeria, holden at Asaba. In that court, the plaintiff’s claims, as amended,against the defendants jointly and severally are as follows:-

“(1) An order of Court on the 1st defendant to pay the 2nd defendant the amount of loan he took from the 2nd defendant plus interest and other charges on the said loan.

(2) An order of court on the defendants to return to the plaintiff the plaintiff’s Statutory Certificate of Occupancy No. BDSR 5273 of 14th June, 1985 and registered as No. 9 at page 9 in Volume B.69 at the Lands Registry, Benin City.

(3) To exchange the plaintiff’s Certificate of Occupancy No. BDSR 5273 of 14th June 1985 and registered as No.9 at page 9 in Volume B.69 at the Lands Registry, Benin City with the 1st defendant’s Customary Certificate of Occupancy No. BDCR 54 and registered as No. 54 at page 54 in Volume 3 at Oshimili Local Government Council, Asaba which has now been converted into a Statutory Certificate of Occupancy No. BDSR 8493 and registered as No. 40 at page 40 in Volume B.115 at the Lands Registry in the office at Benin City and/or order the defendants to make the 1st defendant the surety to the loan and execute Deed of Mortgage on the Statutory Certificate of Occupancy No. BDSR 8493 and registered as No. 40 at page 40 in volume B.115 at the Lands Registry in the office at Benin City on the loan of N200,000.00 (Two Hundred Thousand Naira Only).

(4) Perpetual injunction restraining the defendants from interfering with the plaintiff’s possession and ownership of the property described in the plaintiff’s Statutory Certificate of Occupancy’ No. BDSR 5273 dated 14th June 1985 and Registered as No. 9 at page 9 in Volume B.69 at the Lands Registry, Benin City.”

Pleadings were ordered in the suit and were duly settled, filed and exchanged.

At the subsequent trial, all the parties testified on their own behalf and the plaintiff called one witness in support of his claims.

The brief facts of this case as found by the trial court and affirmed by the court below are that following an application by the 1st defendant to the 2nd defendant bank for a loan of N200,000.00, the same was granted on a guarantee provided by the plaintiff in respect of his property covered by his Statutory Certificate of Occupancy No. BDSR 5273 registered as No. 9 at Page 9 in Volume B.69 at the Lands Registry in the office at Benin City. The plaintiff deposited this Certificate of Occupancy with the 2nd defendant bank as an additional security for the said loan. The 1st defendant had previously deposited his Customary Certificate of Occupancy No. BDCR 54 registered as No. 54 at Page 54 in Volume 3 at Oshimili Local Government Council, Asaba and now converted into a Statutory Certificate of Occupancy No. BDSR 8493 registered as No. 40 at Page 40 in Volume B.115 at the Lands Registry in the office at Benin City as security for the same loan.

A tripartite legal mortgage, Exhibit E, was subsequently executed to cover the loan. The plaintiff duly guaranteed the repayment of this loan by signing the 2nd defendant’s guarantee form, Exhibit D.

On the basis of the above securities offered, the 2nd defendant bank allowed the 1st defendant to draw on the said loan. After taking full benefit of the said loan facility, the 1st defendant abandoned his account with the 2nd defendant and defaulted in the repayment of the loan.

It ought to be mentioned that the plaintiff and the 1st defendant on their own entered into an agreement, Exhibit A, which made provisions as to how the 1st defendant would operate his relevant account with the 2nd defendant bank. The 2nd defendant bank was not a party to Exhibit A. It is the finding of both courts below that Exhibit A was deposited with the said 2nd defendant bank.

When the 1st defendant defaulted in the repayment of the loan, the 2nd defendant bank made several demands on both the plaintiff and the 1st defendant to repay the loan and the interest thereon. Instead of making repayment of the said loan guaranteed by him, the plaintiff instituted an action against both defendants claiming jointly and severally as per paragraph 16 of his amended Statement of Claim.

At the conclusion of hearing, the learned trial Judge after a review of the evidence on the 6th day of October, 1989 entered judgement for the plaintiff as claimed. On the question of whether the 2nd defendant bank was bound by the terms of Exhibit A between the plaintiff and the 1st defendant, the trial court stated:-