African Continental Bank Plc V. Victor Ndoma-egba (2000)

LawGlobal-Hub Lead Judgment Report

EDOZIE, J.C.A.

This appeal emanated from Suit No. C/98/93 commenced at the Calabar High Court but concluded at the Ogoja High Court to which the trial Judge was transferred. It was commenced by the respondent as plaintiff suing on behalf of Ndoma-Egba, Ebri and Company which is a firm of solicitors. The partners were at all material times Chief Victor Ndoma-Egba, the senior partner and Richard D. Ebri (now deceased) as a partner. The suit was against the appellant Bank with respect to its Calabar Branch in which the respondent opened and operated a Current Account No.05756. Upon the order of the Court, parties filed their pleadings terminating in the respondents’ amended statement of claim and the appellant’s amended statement of defence. As articulated in paragraph 18 of the amended statement of claim, the terms of the claim read as follows:-

“18. Whereof, the plaintiff claims from the defendant:-

i) The sum of N331,000.00 unlawfully withdrawn from the plaintiff’s Current Account.

ii) Interest on the principal sum calculated at the rate of 52% from the date of withdrawal until judgment.

iii) N5 Million (Five Million Naira) being general damages for breach of contract, negligence and loss of reputation”.

In the ensuing trial, the respondent and his partner gave evidence while the appellant’s case was presented by one witness.

The case of the respondent is that the partnership firm of Ndoma-Egba, Ebri and Company opened a clients’ Current Account No.05756 at appellant’s Calabar Branch with Victor Ndoma-Egba (P.W.1) and Richard D. Ebri (P.W.2) as joint signatories to the account. At the opening of the said account, a mandate card Exhibit 1, was completed on which the specimen signatures of the partners were written. It was a joint account and according to the mandate, cheques drawn on the account must be signed by the two partners. The partnership later paid into the account the sum of N500,000.00 (Five Hundred Thousand Naira). It then issued on that account a cheque dated 12/3/93 for the sum of N375,000.00 (Three Hundred and Seventy-Five Thousand Naira) to its, client, the Reynolds Construction Company Limited (R.C.C.) through a sister company Nigerian Water Resources Development (N.W.R.D.) On 30th March, 1993, P.W.1 called on the appellant bank to confirm payment of the said cheque for N375,000.00 but was informed that the cheque had not come in for payment but that if it did, it could not be honoured for the reason of insufficient funds. The cheque was subsequently returned to the respondents as unpaid vide letter dated 3/4/93 Exhihit 14.

It is the respondents’ case that, upon further enquiry as to why the account was not in funds, P.W.1 discovered from the relevant ledger cards, three strange debits for various sums of money, viz: N225,000.00 (made on 1/3/93), N31,000.00 (made on 1/3/93) and N75,000.00 (made on 12/2/93) all totalling N331,000.00. The Appellants’ Branch Manager at the time, one Mr. I. S. Omenye brought out three cheques Exhibits 2, 3 and 4 upon which the various sums were withdrawn and on examination P.W.1 confirmed that -they were all forged with regard to the signatures of P.W.1 although-the signature of his partner P.W.2 thereon were regular and genuine. It was admitted that a letter dated 31/3/93 (Exhibit 16) was written by PW2. It was addressed to the Appellant Bank with the cheque Exhibit 2 request to issue a Bank draft for the amount stated thereon in favour of the Federal Super Phosphate Fertilizer Company Limited, Kaduna. Furthermore, it is the Respondent’s case that by letters respectively dated 31/3/93 (Exhibit 5) and 6/4/93 (Exhibit 6) the P.W.1 and their Counsel, Kanu G. Agabi and Associates asked the Appellant Bank to credit the Firm with the amounts fraudulently withdrawn but in response to those letters, the Appellant’s Solicitor by letter dated 8/4/93 (Exhibits 7 and 8), denied liability and threatened an action for defamation arguing that, the cheques in question were presented for payment by an Accountant in the employment of the partnership. The Respondent reported the matter to the police, engaged Auditors to audit the account but this they could do not as the appellant did not co- operate with them.

On the part of the Appellant, it contended that none of the cheques Exhibits 2, 3 and 4 was forged as alleged by the Respondent and further that even if the signature of P.W.1 on those cheques were forged as contended by the Respondent, the admission by the partnership that the signature of P.W.2 on them was valid and regular raises an estoppel against the partners, having regard to Exhibit. 16. Upon the foregoing facts, the learned Judge Okoi I. Itam J. entered judgment for the Respondent in the following terms:.

(a) “N331,000.00 unlawfully withdrawn from its current account No.05756 as a result of the defendant’s negligence.

(b) The plaintiff is however entitled to interests for its funds tied up which are assessed and fixed at the conservative rate at the per centum per annum with effect from 1st March, 1993.

(c) It is further directed that the Defendant shall also pay to the plaintiff interest upon the calculated judgment debt/interest herein at the rate of 8 per centum reckoned from tomorrow 23/9/99.

(d) I hereby award general damages in favour of the Plaintiff against the Defendants in the sum of N500,000.00.”