Diamond Bank Ltd. V. Prince Alfred Amobi Ugochukwu (2007)

LawGlobal-Hub Lead Judgment Report

RHODES- VIVOUR, J.C.A.

The dispute out of which this appeal arose was between a bank and its customer. The appellant is the bank, while the respondent is the customer. The respondent (as the plaintiff) sued the appellant (as the defendant) on a writ of summons accompanied by statement of claim wherein he claimed the sum of N126, 796.500 (one hundred and twenty six million, seven hundred and ninety-six thousand five hundred naira) as general and special damages for dishonoring his cheques drawn on the defendant bank and/or for conversion or unlawful freezing of the plaintiff’s account with the defendant.

This is how the dispute arose. The plaintiff is a businessman. He runs two separate accounts with the defendant bank. A current account in the name of AL-CLEMENT with account No. 0712555017. The signatories to the Account are the plaintiff/respondent and one Ugochukwu Unachukwu, also known as Uzoma Onuoha.

The second account is a fixed deposit account held under the personal name of the plaintiff/respondent. He is the sole signatory to the fixed deposit account. The plaintiff entered into contracts to produce pupil identity cards for the Imo State Primary Education and Secondary Management Boards and was paid cheques twice in the sum of N3million and once in the sum of N10 million. The cheques were lodged into the plaintiffs/respondents business account. (i.e. the current account). Thereafter cheques issued by the plaintiff/respondent on 12/8/97, 22/9/97, 6/8/97 and 6/10/97 was dishonored.

The defendant/appellant informed the plaintiff/respondent that the cheques were dishonored for reason of incomplete mandate and both accounts frozen on the orders of the task force on recovery of public property and funds.

Dissatisfied with this state of affairs the plaintiff/respondent filed suit giving rise to this appeal.

The case was tried by Agugua, J. of the Owerri High Court. On 19/7/02 the learned trial Judge entered judgment in favour of the plaintiff/respondent and held/ordered as follows:

1. The defendant has no liability to the plaintiff in conversion.
2. The plaintiff is entitled to the money deposited in the fixed deposit account and the AL-CLEMENT account with all the interest earned as a result of the contract between the parties from inception of the account interest from the time of deposit till the defendant delivers payment to the plaintiff.
3. On the AL-CLEMENT account defendant is ordered to make an up-to-date statement of accounts and pay plaintiff the balance outstanding to plaintiff’s account.
4. Plaintiff is awarded damages in the value of the four (4) cheques dishonoured in the sum of N 1, 590,000.00.
5. The sum of N3 million is awarded as general damages to the plaintiff against the defendant.
6. That special damages claimed by plaintiff as itemized in his statement of claim do not avail him.
7. Defendant ordered to pay to the plaintiff the sum of 100,000.00 as cost of the action.

The defendant was dissatisfied with the judgment of Agugua, J., and on 20/7/02 he filed a notice of appeal. There are six grounds of appeal.

Briefs were filed and duly exchanged in accordance with Order 6 rules 2 and 4(1) of the Court of Appeal Rules.

The appellant formulated five issues for determination:-

1. Whether the cheques drawn without the co-signatory to the AL-CLEMENT account was in conformity with the term of the contract in the banker-customer relationship between the appellant and the respondent in the face of exhibits ‘D’, ‘O’ and ‘M’.
2. Whether the orders of the Imo State Task Force on Recovery of Government Property and Funds did not apply to frustrate the banker-customer contractual relationship between the appellant and the respondent in this case.
3. Whether the court below rightly assumed jurisdiction to entertain this suit in the face of the clear ouster provision of the relevant law.
4. Whether the operation of the AL-CLEMENT account was not, in the circumstance of this case, tainted with illegality.
5. Whether the court below was right in refusing the appellant’s application to amend its statement of defence to specifically plead a banking custom or practice.

The respondent also formulated five issues for determination:-

a) Whether the cheques drawn without the co-signatories to the AL-CLEMENT account was in conformity with the term of the contract in the banker-customer relationship between the appellant and the respondent in face of exhibits ‘D’, ‘O’ and ‘M’.

b) Whether the order of Imo State Task Force on Recovery of Government Property and Funds did not apply to frustrate the banker-customer contractual relationship between the appellant and the respondent in the case.

c) Whether the court below rightly assumed jurisdiction to entertain this suit in the face of the clear ouster provision of the relevant law.