African Continental Bank Plc. V. Catapult Limited & Anor. (2008)

LawGlobal-Hub Lead Judgment Report

SOTONYE DENTON-WEST, J.C.A.

This is an appeal brought by the Appellant against the judgment of the lower court sitting in Enugu in suit No. E/303/92. Appellant is the first defendant in the lower court whilst the 2nd defendant is the Merchant bank for African Ltd now liquidated. Both defendants were bankers. The Respondents were the plaintiffs in the court below.

The Respondents in the Court below claimed against the two defendant’s damages for breach of contract, injunction and an order to reverse and release to them some irregular and wrong debits and charges made against them. The parties exchanged pleadings and later parties not being satisfied with the original pleadings both filed amended statement claim and an amended statement of defence, which were lengthy and marathon as same could be gleaned from the records. During the course of the judgment, I shall when necessary refer to salient portions of the pleadings.

However, in paragraph 20 of the amended statement of claim the plaintiffs asserted that they have incurred damages as a result of the breach of contract by the defendants, resulting in the closure of the plaintiffs factory since 1989 and damages to the reputation of the plaintiffs. Thus Plaintiffs in paragraph twenty of the Amended Statement of Claim demanded from the defendants as follows:-

a) The sum of one Hundred Million Naira (N100m) damages for breach of contract.

b) An injunction restraining the defendants, their agents and or servants from selling off the mortgage property; to wit, the Maize Flour Milling Industry at Amodu, Awkunanaw, or the 2nd Plaintiffs property at No.6 William Onyeabor Street, Awkunanaw, Enugu, property not mortgaged, to the defendants.

c) An order on the 1st defendant to reverse and release to the Plaintiffs the irregular and wrong debits and charges made against the 1st Plaintiffs account amounting to over N400,000.00 (Four hundred thousand Naira)

d) An order on the 2nd defendant to pay the sum of N5m (five million naira) to the 1st Plaintiff representing damages for dishonouring the 1st Plaintiffs instruction to pay N45,000.00, to its creditor.

DATED AT ENUGU this 20th day of November, 1995.”

In response to this claim, the defendants also vehemently denied the assertions of the plaintiffs and averred inter alia, particularly from paragraph 25 – 30 of the Statement of Defence where they specifically denied the plaintiffs averments in paragraph 20 of their statement of claim

“25. The defendant vehemently denies paragraph 20 of the Statement of Claim. The defendant also denied liability for any or all the reliefs claimed thereon. The defendant did not breach any contract with the plaintiffs arising from the aforesaid loan transaction or at all. The defendants on the other hand did more than were required of it under the aforesaid agreement. The defendant contends that the plaintiff did not suffer any damage flowing from its relationship with the 1st Plaintiff under the loan agreement or at all. Also the defendant is not instrumental to the 1st plaintiff’s alleged inability to operate its said factory.

26. Further to the above answer, the defendant denies specifically all the reliefs itemized under paragraph 20 of the statement of claim. The plaintiffs are not entitled to the said reliefs because the defendant did not breach its obligation under the Loan Agreement, nor did it make any irregular and wrong debits and charges i.e. N400,000.00, against the 1st plaintiff or at all.
27. In addition to the answers in the two proceedings paragraphs, the defendants contends in the alternative that if the plaintiffs suffered any damage in the aforesaid relationship, which the defendant however denies, the same originated from the plaintiffs ineptitude in their not properly husbanding the funds which the defendants promptly made available to them under the Loan Agreement. The defendants also contends that all moneys which the 1st plaintiff is entitled under the said Agreement, including any other reversals of charges, interests, and Commission are property reflected in the 1st plaintiffs current account as evidenced in the statement of account herein pleaded.
28. Further to the foregoing answers, the defendant contends that if any charge or interest was wrongfully debited against the 1st plaintiffs accounts, which is however denied, the same was done by genuine mistake, which did not embarrass or prejudice the 1st plaintiff, as the same is of no consequence.
29. In addition to the defences herein contained, the defendant contends that the present action of the plaintiffs is not bona fide as it is a ploy to delay the defendant’s rights of foreclosure as provided in the Loan Agreement, and the Mortgage Debenture Trust Deed respectively and thereby unnecessarily tie down the defendant’s shareholders’ funds.
30. The defendant will rely on the relevant equitable and legal defences that may be open to it at the trial, among others, in praying the honourable court to dismiss the plaintiffs’ claims completely for reasons of their being frivolous, capricious, and an abuse of the court’s process. Dated the 10th February, 1996.”

At the hearing of the Appeal, Chris Aghanwa Esq. of counsel to the Appellants adopted his Appellant’s amended Brief of argument dated 23rd April, 2007 and deemed filed on 27/6/2007 by order of court. He adopted and relied on the brief. He raised three issues for determination, which were distilled from twelve grounds. He urged this court to set a side the judgment.

Mr. P.M.B. Onyia of Counsel to the Respondent also, adopted his Respondent’s Amended brief of argument dated 18th June 2007 and deemed properly filed on 27th July 2007. He raised three issues for determination. He prayed the Court to dismiss the appeal and affirm the judgment.

The three issues raised for determination by the appellant are as follows: