Citibank Nigeria Limited V. Gratis Properties Limited (2015)

LawGlobal-Hub Lead Judgment Report – COURT OF APPEAL

AMINA ADAMU AUGIE, J.C.A. (Delivering the Leading Judgment)

The Respondent maintained a current account at the Allen Avenue Branch of the Appellant, Ikeja, Lagos. On 16/4/2003, it issued a cheque in favour of “Integrated Environmental Control and Safety System” for N12,000.00 that was returned to the beneficiary with the inscription “Account Closed”. Aggrieved by the Appellant’s action, which it believed had dented it’s credit and reputation, the Respondent instituted an action against the Appellant at the Lagos State High Court, wherein it claimed the following reliefs –

(a) A DECLARATION that the purported unilateral closure of the Plaintiff’s Account No. 0030949005 by the Defendant is unlawful and a breach of the Defendant’s duty to the Plaintiff.

(b) A DECLARATION that the inscription and publication of the words, “Account Closed” by the Defendant on the cheque dated 16/4/2003 and issued by the Plaintiff in favour of Integrated Environmental Control and Safety System, is defamatory of the Plaintiff.

(c) DAMAGES of the sum of N10 Million Naira for the defamation of the Plaintiff as a result of the Defendant’s said publication and failure and/or refusal to honour the Plaintiff’s said cheque referred to above.

(d) INTEREST at the rate of 7% per annum on the Judgment debt until the entire Judgment debt is liquidated.

In response, the Appellant filed a Statement of Defence and Counter-Claim, wherein it counter-claimed against the Respondent for the following –

a. A DECLARATION that the Plaintiff is bound to return to the Defendant with effect from 21/3/2003 all unused cheque leaves issued by the Defendant in its possession.

b. An ORDER that the Plaintiff do forthwith cause to be returned to the Defendant all unused cheque books, leaves and other materials relating to the extinguished Account No. 0030949005 in its possession.

The Respondent filed a – Reply to the Statement of Defence and Defence to the Counter-Claim, wherein it denied any allegation of indebtedness to the Appellant and insisted that it had sufficient credit to satisfy the said cheque.

At the trial that ensued, the Respondent called its Chief Executive, Otunba Simi Fasehun, as PW1. He tendered the said cheque as Exhibit P1, and testified that the Respondent was embarrassed as a result of the failure of the Appellant to honour the cheque since it had just deposited the sum of N220,000.00 into the said Account prior to issuing Exhibit P1.

He denied receiving any letter from the Appellant informing him that the said Account will be closed prior to its dishonouring Exhibit P1. The Respondent also called the Managing Director of the said beneficiary, Mr. Kehinde Awosika, an Environmental Consultant, who testified as PW2, and he was of the view that the inscription on Exhibit P1 meant insufficient funds in the Account.

The Appellant called only one witness as DW1, Mrs. Doyin Adegbayi, who worked in the Bank’s Investment Services Group, and she testified that on 21/2/2003, the Appellant had sent a 1-month notice to the Respondent advising that the Account be closed at a further date; and that the letter admitted as Exhibit D3, was sent to the Respondent by registered post, and the date for closure on Exhibit D3 was 21/3/2003. She further stated that the said Exhibit P1 was presented on 16/4/2003, however, the Bank did not process the transaction because the Respondent’s Account was closed, and Exhibit P1 was returned for the reason that the Account was closed.

Thereafter, learned counsel filed and exchanged Written Addresses, and in his Judgment delivered on 1/7/2004, learned trial Judge, Kasali, J., was of the view that Issues to be determined in the case were as follows –