African Continental Bank Limited V. Alhaji Taofiki Aloa (1994)

LawGlobal-Hub Lead Judgment Report

SAMSON ODEMWINGIE UWAIFO, J.C.A. 

The main issues in this appeal concern the Bills of Exchange Act and the Exchange Control Act. They touch upon what to do with a total of forty-five bank drafts with proceeds of ?212,310.00 to which the plaintiff, a Benonois living in Port Novo, claims to be entitled to. The said claim is based on some loans of some amount of unspecified CFA Francs which he allegedly gave to some also unnamed Nigerian traders for the payment of their children’s school fees in the United Kingdom (U.K.) when they met in Cotonou between December, 1980 and January, 1981. The forty-five bank drafts which were said to be in repayment were made payable in the U.K. They were issued by the defendant bank in Lagos, on the application of whom no evidence was led. They were all dated between December, 1980 and January, 1981. The honouring of the drafts ran into difficulty in London. The plaintiff wanted them credited into his account in London. The drafts were not however in his name and were crossed and endorsed ‘A/C payee only. Not negotiable.’9191 The defendant bank in London turned down all efforts by the plaintiff to get the proceeds of the bank drafts.

The plaintiff then took action at the Lagos High Court to seek three declarations and a mandatory order. On 31 May, 1988, C. O. Segun J., granted all four reliefs. The reliefs which the plaintiff claimed against the defendant were stated as follows:-

“1. A declaration that the 45 drafts amounting to #212,310 (Two hundred and Twelve thousand, Three hundred and Ten Pounds Sterling) drawn by the defendant in Lagos on its London branch office and presented to the said London branch office by the plaintiff through his various bankers are valid, properly and regularly, negotiated drafts.

2. A declaration that the said drafts have not expired and are still negotiable.
3. A declaration that the plaintiff is entitled to have the drafts honoured by the London Branch of the defendant.
4. An order of the court compelling the defendant to direct its London Branch to honour the drafts.”

The defendant having complained against the judgment in its appeal to this court, raised the following four issues for determination in its brief of argument:-

“(i) Whether the learned trial Judge in law directed himself properly by entering judgment for the plaintiff/respondent in respect of a transaction whose illegality is not only transparent on the fact of it but also pronounced by statute.

(ii) Whether the learned trial Judge in law directed himself properly by holding that the 45 Bank Drafts tendered in evidence are mere Promisory Notes and therefore not within the provisions of Section 3(1) of Bills of Exchange Act Cap. 21 Laws of the Federation of Nigeria.

(iii) Whether the learned trial Judge erred in law by deviating from and/or not following the Supreme Court of Nigeria decision in Chief Harold Sodipo v. Leminkainen (sic) ANR (1986) 1 S.C. 197 by granting judgment to the plaintiff/respondent.

(iv) Whether the learned trial Judge erred in law by relying only on the single uncorroborated evidence of the plaintiff without more to come to a decision that the plaintiff has an enforceable right.”

I think the issues which really arise from the grounds of appeal are two, namely: (a) whether there was apparent or proved illegality affecting the plaintiff’s cause of action; (b) whether, apart from illegality, the evidence justified the plaintiff’s claim to the proceeds of the forty-five bank drafts.

At the lower court, learned counsel for the defendant, Chief Ezeogu, referred to some paragraphs of the statement of claim as showing the illegal transaction which brought about the plaintiff’s claim of right to the drafts in question. He also specifically pleaded illegality in the statement of defence. In regard to the statement of claim, the plaintiff having pleaded that he did a lot of business with some of his Nigerian friends, averred in paragraphs 4, 5, 7, 8 and 9 as follows:-

“4. Between 1980 and 1981 some of these Nigerians in the ordinary course of business, approached the plaintiff in Benin or/and in Europe to enable them settle various schools and universities bills of their children and dependants in Europe and America thus sparing such children and dependants hardship and inconveniences which late settlement of schools and other bills might entail.

5. The Nigerian friends who approached the plaintiff to accommodate them as stated in the foregoing paragraph did so because of the long delay in their getting the Central Bank of Nigeria’s approval for Foreign Exchange applications to enable them remit funds to their children and dependants abroad.
6. The plaintiff granted the requests of his Nigerian friends in this regard and provided funds abroad to them through his country’s local currency, the C.F.A. Francs which is fully and freely convertible in the world currency market being aligned to French Francs.
7. When the Nigerians eventually obtained the foreign exchange approvals from the Central Bank of Nigeria, the drafts issued by the defendant to the Nigerians in relation to the school fees and maintenance allowance of their children and other dependants were passed to the plaintiff in settlement and reimbursement of the sums earlier advanced by him.
8. The plaintiff and the said Nigerians also agreed on how to meet any shortfall or surplus as the case might be, should there be any shortfall or surplus after the plaintiff would have collected the proceeds of the drafts.
9. The plaintiff received altogether 45 drafts from the Nigerians pursuant to this arrangement the total value of which was ?212,310. The particulars of the drafts are set out in the schedule to this statement of claim.”

The plaintiff in his testimony said he had helped seven Nigerians the same way previously and that he was able to claim the proceeds of seven bank drafts which they later brought to repay him. I must say that there is of course no evidence whatsoever to support this. But even if there had been such evidence it would have no bearing on whether the present transaction was illegal. The plaintiff further said:-

“After this transaction (meaning of those seven bank drafts), other customers of mine came seeking for my help in the same way. This was between December, 1980/January, 1981. The customers were all from Nigeria and I decided to help them like the first one. I loaned them the money and transferred the money to their children through my bank and they came back with their bank drafts and remittance slips. The drafts were endorsed at the back for me by them and paid into my account. In all 45 bank drafts were brought down by the defendants in Lagos on its London Branch Office.”