Ali Shour & Anor V. Nigeria Deposit Insurance Corporation & Ors (2014)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

HABEEB ADEWALE OLUMUYIWA ABIRU, J.C.A. (Delivering the Leading Judgment)

This is an appeal against the Ruling of the High Court of Kano State in Suit No. K/687/2001 delivered by Honourable Justice N. S. Umar on the 9th of March, 2010 wherein the lower Court made an order joining the Appellants as co-plaintiffs in the suit on the application of the first Respondent.

The second and third Respondents, as plaintiffs, commenced the action in Suit No. K/687/2001 in the High Court of Kano State against City Express Bank Limited, as defendant, and the first Respondent was subsequently substituted for City Express Bank. The claims of the second and third Respondents, as plaintiffs, were:

i. A declaration that the Defendant’s refusal to allow the first Plaintiff draw down part of the facility granted it on the 2nd of October, 2001 and renewed severally is a breach of the terms and conditions of their agreement and occasioned a miscarriage of justice to the Plaintiffs.

ii. A declaration that the interest and/or other banking charges debited to the account of the first Plaintiff is excessive and arbitrary.

iii. A declaration that the recent threats of recall and or withdrawal of the facility under reference is a breach of the terms and conditions of the agreement between the parties herein and therefore null and void whatsoever.

iv. A declaration that the Defendant’s threat of auctioning the Plaintiffs landed property at No. 11, Dawaki Road, Nassarawa, GRA Kano, and trading stock is a breach of the agreement between the parties herein and therefore null and void whatsoever.

v. An order compelling/directing the Defendant to obey the terms and conditions of the grant of the facility in question relating to the repayment schedule and sources.

vi. An order of this Honourable Court appointing or directing the appointment of an independent auditor or a firm of auditors to properly audit the account of the first Plaintiff with the Defendant’s Kano Branch.

vii. An order of injunction restraining the Defendant from making excessive and arbitrary interest and or other bank charges on the first Plaintiff’s account with it.

viii. An order of injunction restraining the Defendant either by itself, its agents, servants, successor-in-title, privies and assigns from selling by auction or otherwise disturbing in whatever way the Plaintiffs’ title and possession of their property situate at No. 11, Dawaki Road, Kano covered by the Kano State certificate of occupancy No. LKN/RES/RC/8100010 and trading stock at No. 10 Fagge Takudu, Kano.

The third Respondent is the chairman of the second Respondent and their case on the pleadings was that the second Respondent maintained a current account with the Kano Branch of City Express Bank Ltd and that sometime in April 2000, the Bank granted an overdraft (renewal/enhancement) facility of N25 Million to the second Respondent on terms and conditions contained in a letter of approval dated 17th of April, 2000 and the interest rate on the facility was fixed at 35% per annum renewable in line with prevailing market conditions. It was their case the facility was subsequently renewed and enhanced to the sum of N30 Million on terms and conditions contained in a letter dated the 2nd of October, 2000 and the interest rate was fixed at 30% also renewable in line with prevailing market conditions. It was their case that the facilities were secured by a legal mortgage created over the property lying and being at No. 11, Dawaki Road, Kano covered by the Kano State Certificate of Occupancy No. LKN/RES/RC/8100010 and a lien mortgage on the trading stock of ile materials of the second Respondent. Problems arose with the servicing of the facilities and the Bank threatened to call in the mortgage and the lien and it was the case of the second and third Respondents that the action of the Bank was not within the terms and conditions of the facilities and that the Bank debited the account with excessive interests and bank charges contrary to the agreed terms and conditions.

In response, the Bank filed a statement of defence and a counterclaim wherein it admitted that the second Respondent was its customer in its Kano Branch and that it granted the second Respondent the overdraft facility of N25 Million and which was subsequent enhanced to N30 Million on terms and conditions embodied in letters of approval and it stated that the facilities were secured by (i) a tripartite deed of legal mortgage over the property at No. 11, Dawaki Road, Kano covered by the Kano State certificate of occupancy No. LKN/RES/RC/8100010, (ii) personal guarantee of the third Respondent, and (iii) a deed of Hypothecation of Stock. It denied acting and/or charging interest and charges outside the agreed terms and conditions and it was its case that it was the second and third Respondents that breached the terms of repayment agreed by the parties such that as at 30th of April, 2003 the debit balance in the account was N74,644,908.01 and that the second and third Respondents failed to liquidate the debt despite repeated promises. The Bank counterclaimed for the sum of N74,644.908.01 together with interest at the rate of 40% from the 1st of May, 2003 until judgment and thereafter at the rate of 10% until liquidation.

On the 4th of March, 2010, the first Respondent filed an application dated the 3rd of March, 2010 before the lower Court praying for an Order joining the Appellants herein as the third and fourth plaintiffs in the matter. The case of the first Respondent on the affidavit in support of the application was that the first Appellant was the brother of the third Respondent while the second Appellant was their mother and that the third Respondent and the Appellants were joint title holders by inheritance of the property at No. 11, Dawaki Road, GRA Kano covered by the Kano State Certificate of Occupancy No. LKN/RES/RC/8100010 and that this was the subject matter of a dispute in Suit No. K/729/2003 pending before the High Court of Kano State. It was the case of the first Respondent that the property was also part of the subject matter of the present suit and was the only real estate owned by late Mohammed Yusuf Shour, the father of the third Respondent and first Appellant and husband of the second Appellant and that the third Respondent and the Appellants are the beneficiaries to the property under the Islamic Law of succession. It was its case that it was necessary for the Appellants to be joined as parties in the present suit so that all the issues relating to the property in question would be resolved and the decision of the lower Court in this suit will be binding on all persons who have an interest in the property.