K. R. K. Holdings Nigeria Limited V. First Bank Of Nigeria Limited & Anor (2016)

LAWGLOBAL HUB Lead Judgment Report

CHIMA CENTUS NWEZE, J.S.C.

At the High Court of Lagos State, the appellants in this appeal (as plaintiffs) claimed against the first respondent herein (as defendant) the following relief as per the Statement of Claim before that Court (hereinafter, simply, referred to as “the trial Court”):

“Whereof the plaintiff’s claim against the defendant is for the sum of Fifty Million Naira (N50,000,000). The defendant as drawer of Bank certified cheques totaling N4,500,000.00 drawn upon the defendant bank at its Moloney Street Branch, Lagos, payable to the plaintiff and delivered by S. C. O. A. to the plaintiff which said cheques were duly presented for payment on the 12th day of June, 1989, which were dishonoured and although the defendant had due notice thereof by letters dated 8th June, 1989 and 12th June, 1989, respectively, the defendant still refused and or neglected to pay the said cheques.”

(pages 261 -262 of the record)

At the instance of the first respondent herein, the second respondent was joined as a third party in the action. Upon the joinder of issues on the settled pleadings which

1

were, duly, exchanged, the matter went to trial.

From the records, the appellant made the case that, at the instance of the second respondent in this appeal, the first respondent caused to be drawn four bank drafts worth N4. 5 million in its (appellant’s) favour. Sequel to its dishonor of the said drafts, the appellant took out an action against the first respondent claiming not only the value of the cheque, but also interests, charges and general damages.

While the first respondent claimed to have dishonoured the cheques on the instruction of the second respondent, the latters ground for stopping the drafts was because of the absence of consideration from the appellant. Following the trial Court’s dismissal of the claim, the appellant approached the Court of Appeal, Lagos Division (hereinafter, simply, referred to as “the lower Court”) which also dismissed the appeal to it.

Aggrieved by the lower Courts concurrent verdict, the appellant repaired to this Court. It framed two issues for the determination of the appeal, namely:

1. Whether the lower Court was right in upholding the finding of no consideration made by the

2

trial Court in a business transaction, the nature of which he could not decipher, which justified the first respondent (not being a party to the transaction) to refuse to honour its bank certified cheques in spite of the trial Court’s finding that the cheques were not misplaced

2. Is the Court of Appeal bound by its previous decisions

In the brief of argument filed on October 11, 2005, the first respondent concreted a sole issue which was phrased thus:

Whether payment of the first respondent bank cheques (exhibits P2 – P5) can be properly dishonoured and countermanded by and on the instruction of the second respondent for lack of consideration in a questionable contract/transaction lacking in consensus ad idem