Chief J.K. Odumosu V. African Continental Bank Ltd (1976)

LawGlobal-Hub Lead Judgment Report

IDIGBE, JSC. 

In this action the plaintiff is Chief J.K Odumosu and the defendants are African Continental Bank Limited. We have before us an appeal by the plaintiff from a judgment of Bakare, J., dated 5th of June, 1974, in favour of the plaintiff by which it was ordered:-   (1) that defendants should return to the plaintiff three documents of title to land and a life policy of insurance deposited with the defendants by the plaintiff; and (2) that the defendants should pay to the plaintiff the sum of N8,000 (Eight Thousand Naira) as “general damages”.   The award is a sequel to the plaintiff’s action in detinue in which he claimed from the defendant:-

“(1) the return to the plaintiff of the documents, the particulars of which are hereinafter given, which the plaintiff deposited with the defendant for safe custody and which the defendant has refused or failed to surrender to the plaintiff despite repeated demands by the plaintiff.   (Particulars of the documents in question were then set out);

(2) the sum of fifty thousand pounds (£50.000.0d) being special and general damages for the wrongful detention by the defendant of the said documents”   Summarily, the plaintiff contends that the amount of N8,000 awarded by the learned trial Judge as damages was inadequate and that he (the learned Judge) erred in law in holding “that the evidence before him fell far short of establishing special damages”.

We will now set out the facts, not only so much of them as are material to the issues raised in this appeal, because it is our considered view that a detailed review of the entire facts before the trial court not only assists in throwing adequate light on the arguments urged upon us, but certainly explains some of the observations which we have found necessary to make in some of the passages in this judgment.

The case for the plaintiff, who is a dealer in electrical and allied products, may be summarised thus: Prior to January, 1970, he, as a customer of the defendant bank, enjoyed overdraft facilities up to a limit of £20,000.0.0d. (Twenty Thousand Pounds) on his own personal guarantee (i.e. without producing for the benefit of, or depositing with, the bank any form of security), and on the terms that subject to “satisfactory operation of his account” the overdraft was subject to “automatic renewal” at the end of every calender year. In or about January, 1971, consequent upon a burglary committed in his house, he lodged with the defendants, for purposes of “safe keeping” (i.e. safe custody), some of his precious documents which “survived the burglary” (i.e. three conveyances, instruments of title to land and one Life Policy the particulars of which were duly set out in the endorsement on his Writ of Summons and in his pleadings). These documents which consist of :-

(a) two land certificates of title to two landed properties situate in the Surulere district of Lagos valued at £45,000 and £35,000 respectively;

(b) one instrument of title in respect of landed property situate at Bashua village in the Shomolu district of Lagos valued at £25,000; and

(c) a Life Policy of Insurance for £3,000, shall hereafter in this judgment be together referred to as “the four vital documents”.

In early February, 1971, a few weeks after the deposit of these documents with the defendants, he (the plaintiff), asked for, and was granted by the bank, what he described as “a short-term loan of £25,000 for a period of three weeks” and he claimed that this was repaid on 25th February, 1971. Thereafter, plaintiff continued to operate his account “within the agreed overdraft limit” but by July, 1972, his account with the defendants was overdrawn “to the tune of £17,531/11/- (Seventeen Thousand Five Hundred and Thirty-One Pounds and Eleven Shillings)”; he emphasized both in his pleadings and testimony that the four vital documents were not deposited with the defendants “by way of equitable mortgage”.    In 1972, after an “overseas business tour” during which several business contacts were made by him, the plaintiff asked for Letters of Credit to be opened by the defendants first, in favour of a Taiwan trading firm (hereinafter referred to as “The Taiwan Firm”) with whom he successfully arranged for a “standing order for various table and standing fans to the value of $26,298.76 (i.e. Twenty-Six Thousand Two Hundred and Ninety-Eight Dollars and Seventy-Six Cents)” and, later, in favour of another Taiwan Electrical firm – “IH-SHIN Electrical Works” – (hereinafter referred to as the “IH-SHIN Company”) for the supply of goods worth £24,000 (Twenty-Four Thousand Dollars); thus the plaintiff has asked the defendnat bank for letters of Credit to the total value of $50,298.76 which, inclusive of bank charges at the time was the equivalent of about £N23,000. Letters of Credit were duly opened, as requested, in favour of the Taiwan firm and IH-SHIN Company (hereinafter referred to as the “Taiwan Companies”), who refused to accept the defendants as credit-worthy.

As the plaintiff did not have ready cash he approached two other banks (the National Bank and the Bank of America), who each promised to “accommodate him” (i.e. lend money to him by opening Letters of Credit in favour of the Taiwan Companies) if he produced adequate and satisfactory security to cover the loan. Consequently, the plaintiff demanded from the defendants the return of the four vital documents making it clear to them the purpose for which they were required: but the defendants refused to return the documents. Later the plaintiff arranged with another firm – Messrs. Adebowale Electrical Industries (hereinafter referred to as “Adebowale Company”) who, as the plaintiff claimed, were willing to extend credit facilities to the tune of £40,000 and 25% discount to the plaintiff on all purchases of electrical goods, provided he deposited with the firm adequate security to cover the facilities extended to him.

Similarly, Phillips Nigeria Ltd., to which the plaintiff was heavily indebted was prepared to resume trade with him, extend credit facilities to him and allow him, as well, 25% discount on all purchases provided he deposited with them adequate security. Once again, he demanded the return of his four vital documents from the defendants who refused to deliver them to him.

The defendants who did not call any witness at the trial stated inter alia in their pleadings that the deposit of the four vital documents by the plaintiff “was by way of security” (i.e. “equitable mortgage”), to secure the loan of £25,000 which the plaintiff asked for in February, 1971, at a time when his account was already overdrawn “to the tune of £8,000”. As earlier on pointed out, the learned trial Judge held that the documents were deposited “for safe custody” with the defendants who “mistakenly” considered they had an equitable charge over them; and having held on to these documents “unjustifiably”, the plaintiff’s claim against them (the defendants) must, in his judgment, succeed. The defendants appealed from the said judgment on the grounds, inter alia, that they had a lien on the four vital documents; the plaintiff cross-appealed from the said judgment for the reasons already stated.

At the hearing, the appeal by the defendants was struck out on grounds of procedural error and a subsequent application before us, to regularise the error and thereby restore their appeal, was withdrawn by learned counsel for the defendants who considered that such an application had been overtaken by events; the events culminating in the creation, in the interim between the striking out of the defendants’ appeal and the subsequent application for restoration of the same, of the intermediate Appeal Court – “the Federal Court of Appeal” – to which the defendants intend to pursue their appeal. The subsequent application by the defendants for restoration of their appeal was, accordingly, struck out. The defendants’ appeal having been struck out we feel bound-