Union Bank Of Nigeria Plc V. Alhaji Adams Ajabule & Anor (2011)

LAWGLOBAL HUB Lead Judgment Report

MAHMUD MOHAMMED, J.S.C

This appeal arose from the decision of the court of Appeal, Benin Judicial Division given on 1st, July, 2005 in which the court dismissed, except for the award of general damages where the appeal was allowed by the reduction of the general damages from N5,000,000.00 to N2,000,000.00, the appeal brought by the Appellant in this appeal against the judgment of the High Court of Justice of Ondo State sitting at Akure.

The 2nd Respondent as a customer of the Appellant maintained two current Accounts at the Appellant’s branch of the Bank at Akure in Ondo State. On his part, the 1st Respondent is the Chairman/Managing Director of the 2nd Respondent. On the request of the 2nd Respondent for credit facilities, the Appellant granted the 2nd Respondent an overdraft facility and a warehouse Refinancing facility. The two separate credit facilities were Secured by a Tripartite Deed of Legal Mortgage on the 1st Respondent’s Mariatun House (Formerly No.40) Isewe Street, Clerk Quarters Owo, Ondo State as well as Hypothecation of the 2nd Respondent’s stock of Motor Batteries.

When the 2nd Respondent failed to repay the credit facilities granted by the Appellant inspite of repeated demands’ the Appellant then took steps to enforce its rights under the Deed of Hypothecation of the Stock of Motor Batteries in the custody of the 2nd Respondent. When the 2nd Respondent refused to allow the Appellant to take over the control and management of the Respondents’ business premises, the Appellant proceeded by force and sealed the premises which the Respondents challenged by their action at the trial Court on 11th August, 1999.

The case was heard on pleadings comprising of statement of Claim, Statement of Defence and counter-claim and a Reply to the Statement of Defence and counter claim.

In its judgment delivered on 17th December, 2003, the trial court found for the plaintiffs/Respondents and granted all their claims for declaratory reliefs’ general damages in the sum of N5,000,000.00 and special damages in the sum of N1,580,000.00 against the Defendant/Appellant for the illegal sealing of the premises of the 2nd plaintiff/Respondent. The Defendants/Appellants counter claim, on the other-hand, was dismissed. Also dismissed was the Appellant’s appeal to the court of Appeal except for the reduction of the general damages awarded by the trial court from N5,000.000.00 to N2,000,000.00.

Still dissatisfied with the decision of the court of Appeal, the Defendant/Appellant has now appealed against it on the leave granted by this court on 14th July, 2005. In the Appellant’s brief of argument, the following four issues for determination of the appeal were raised and the same issues were also adopted in the Respondents’ brief of argument. The issues are –

(i) Whether the Court of Appeal was right in affirming the finding of the trial Court as to the existence and contents of the Central Bank Guideline between 1996 and 1999 when the document was not tendered in evidence by the Respondents (Ground 1 of the Notice of Appeal)

(ii) Whether the Court of Appeal was right when it upheld the finding of the trial Court that based on the evidence of PW3 the Appellant was responsible for sealing up of the 2nd Respondent’s Premises on 3rd August, 1999 (Ground 2 of the Notice of Appeal)(iii) Whether on the Pleadings and evidence there is any legal basis for the award of special damages to the Respondents or in the alternative, whether the Respondents discharged the burden of Proof required to succeed in their claim for special damages (Ground 3 of the Notice of Appeal)

(iv) Whether the Respondents are entitled to the award of general damages which was upheld by the Court of Appeal and reduced to the sum of N2,000,000.00 (Two Million Naira) having regard to the settled Principles of law. (Grounds 5, 7 & 8 of the Notice of Appeal).”

Starting with issue t in the Appellants brief of argument, its learned counsel had argued that the parties having joined issues at the trial court on pleadings on the existence of the central Bank Guidelines pegging interest rates at 21% between 1996 and 1999, the Court of Appeal was in error in affirming the decision of the trial Court on the existence and contents of that document which was not in evidence at the trial Court on the evidence of DW2 alone described as an admission against interest of the Appellant. Learned Counsel asserted that the evidence of DW2 does not relieve the Respondents of the burden to prove the contents of the document if the decision in the case of Asafa Foods Factory v. Alraine (Nig.) Limited (2002) 12 NWLR (Pt.781) 353 at 370 – 371 and Kano v. Oyelakin (1993) 3 N.W.L.R. (Pt.282) 399 at 422, are taken into consideration resulting in making the decision of the Court of Appeal perverse and liable to be set aside in allowing the appeal on this issue alone as the case of Inakoju v. Adeleke (2007) 4 N.W.L.R. (Pt.1025) 423 at 607 relied upon by the Respondents, is not applicable to the present issue.

For the Respondents however, it was contended that the documentary evidence on record comprising letters of offer Exhibits 43 and D1 and the Deed of Hypothecation Exhibit A2 containing the terms of agreement between the parties, have put the maximum rate of interest agreed as 21% which shifted the burden of proving any rate of interest to the contrary, on the Appellant; that the position of the Respondents on the issue of interest was strengthened by the evidence of the Appellant’s witness DW2, an employee of the Appellant, on which by the cases of Woluchem & Ors. v. Gudi & Ors. (1981) 5 S.C. 291 and Niger Construction Limited v. Chief A.A. Okungbemi (1987) 11 – 12 S.C.N.J. 133 at 135, the Respondents were perfectly entitled to rely upon to strengthen their case; that having regard to the decision of this Court in the case of Inakoju & Ors. v. Adeolu & Ors. (2007) 143 L.R.C.N. 1 at 93. the Courts below were right in finding that the existence of the Central Bank Guidelines pegging the interest rates chargeable on loan/overdraft granted by banks between 1996 and 1999, had been proved on the evidence of DW2. Learned Counsel pointed out that since there is no appeal against the specific findings of trial Court and affirmed by the Court of appeal that the maximum rate of interest agreed between the parties was 21%, this appeal should be dismissed on this issue.

The central complaint of the Appellant in this first issue for determination is whether the Court below was right in affirming the finding of the trial court as to the existence and contents of the Central Bank Guideline between 1996 and 1990, when the document was not tendered in evidence by the Respondents. It is significant to note that the finding on the existence and contents of the central Bank Guideline between 1996 and 1999, was made by the trial Court at page 78 of the record only after very a careful consideration of the relevant documentary evidence fixing the maximum rate of interest agreed between the Appellant and the Respondents at 21% as confirmed in the evidence of the Appellant’s witness DW2 under cross-examination which the Appellant picked to complain up on in the issue at hand. The comprehensive finding on the rate of interest agreed between the parties as found by the trial court in its judgment at page 78 reads –

“A careful Perusal of Exhibit A2 Deed of Hypothetication of Goods, Exhibit A3 – offer letter dated 18th November 1996 and Exhibit D1 – offer letter dated 9th September, 1997 and Exhibit A1- The Tripartite Legal Mortgage, in my humble opinion constitute agreement in respect of the loan/overdraft/credit facilities granted by the Defendant bank to the Plaintiff. In Exhibit A2, A3 and D1 the maximum rate of interest is 21%.