Union Bank Of Nigeria Plc V. Clement Nwankwo & Anor (2019)

LAWGLOBAL HUB Lead Judgment Report

PAUL ADAMU GALUMJE, J.S.C.

The 1st Respondent herein, who was the plaintiff at the Benue State High Court holden in Gboko, is a customer of the Appellant and operates a current account no. 203146817 at the Appellant’s Gboko Branch. He carries on the business of sale, stock and purchase of frozen fish in Gboko.

On the 10th March, 1999, the Appellant granted an overdraft facility of Two Million Naira (N2,000,000.00) in favour of the 1st Respondent to assist him in his business. This overdraft facility was to expire on the 7th of March, 2000. The first defendant serviced the account satisfactorily as a result, he was granted another facility of N500,000,00 known as “Temporary Excess” on the 14th October, 1999 and this was to expire within six weeks. This facility was credited into the 1st Respondent’s account.

On 22nd of October, 1999 the 1st Respondent drew a cheque of N150,262.50 on his current account with an endorsement at the back directing the manager of the Appellant to prepare a draft of N15,000.00 payable to Niyi Idowu Comm. Ent. The draft was an advance payment for the supply of 30kg or 4,000

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cartons of skumbia fish which the 1st Respondent had negotiated with Niyi Idowu Comm. Ent., a company based in Lagos. According to the 1st Respondent, he was to buy the 4,000 cartons of fish at N1,850 per carton and sell at N2,700.00 per carton, thus making a gain of N850 per carton. He estimated his overall gain to be N3,400,000. The Appellant refused to honour the cheque which it endorsed on its face, “Drawers attention required”. The 1st Respondent could not raise money elsewhere to meet his contractual obligation with Niyi Idowu Comm. Ent. as such the supply of the skumbia fish was frustrated. On the 22nd October, 1999 when the draft was dishonoured, the overdraft facilities had not expired, and the 1st Respondent had in his account the sum of N319,713.33 an amount sufficient enough to satisfy the cheque of N150,000. 1st Respondent felt aggrieved with the appellant’s action, and therefore took out a writ of summon dated 27th October, 1999 and a statement of claim dated 26th of October, 1999, in which he claimed from the Appellant, the following relief: –

(a) A declaration that the refusal of the Defendant to honour the plaintiffs cheque as at 22-10-99

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amount to a breach of contract between the plaintiff and the defendant.

(b) An order stopping the calculation and deduction or the debiting of the plaintiffs account of all the interests and other bank charges payable under the two facilities granted the plaintiff by the defendant as from 22 – 10 – 99.

(c) An order terminating the legal mortgage between the plaintiff and the defendant and a further order directing the defendant to return to the plaintiff forthwith his certificate of occupancy NO. 00808 used as security for the facilities.

(d) The sum of Three Million, Four Hundred Thousand Naira (N3,400,000.00) as special damages.

The Appellant filed a statement of defence on 11th November, 1999 in which it set out the following counter claim:-

(a) The sum of N2,381,633.65 debit balance as at 29th October, 1999 and the accrued amount at the time of judgment and payment in terms as to the contracts bonding the parties under the various facilities.