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.

d) Whether the operation of the AL-CLEMENT account was not in the circumstances of this case tainted with illegality.

(e) Whether the court below was right in refusing the appellant’s application to amend appellant’s statement of defence to specifically plead a banking custom or practice.

A detailed examination of the issues reveals that the respondent has adopted the issues formulated by the appellant. The issues are identical. The court of appeal has power to adopt or even formulate issues that in its view would determine the real grievance in an appeal. See Ikegwuoha v. Ohawuchi (1996) 3 NWLR (Pt. 435) p. 146; Aduku v. Adejoh (1994) 5 NWLR (Pt. 346) p. 582.

I am satisfied with the issues formulated by the appellant and adopted by the respondent. In my respectful view a diligent consideration of them would in the end determine the real complaints in this appeal.

At the hearing of the appeal on 12/2/07, learned counsel for the appellant Chief B. O. N. Nwakanma, SAN adopted his brief, which was deemed properly filed on 17/10/06. He urged us to allow the appeal. The respondent was present but not represented by counsel. His brief filed on 19/6/06 was taken as argued under and by virtue of the provisions of Order 6 rule 9(5) of the Court of Appeal Rules.

I shall now proceed to consider the issues for determination of this appeal as presented by the appellant and adopted by the respondent.

Issue No. 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’.

Learned counsel for the appellant observed that the AL-CLEMENT account was a joint account, and the signatories are/were the respondent and Ugochukwu Unachukwu (also known as Uzoma Onuoha) reference was made to exhibits ‘O’, ‘M’. Learned counsel submitted that if ‘A’ makes a joint account contract with a bank as authorized agent for a disclosed principal, namely himself, and ‘B’ as joint parties, then the banks creditor is ‘A’ and ‘B’ jointly and ‘A’ and ‘B’ are privy to the agreement with the bank.

Concluding his argument learned counsel observed that the learned trial Judge ignored the basic banker-customer contract and re-wrote the agreement for the parties, contending that the Court is not allowed to re-write agreements for the parties. Reliance was placed on Sarafa Ajoke v. Sule Bello (1992) 1 NWLR (Pt. 218) p. 380; Adeniji v. Adeniji (1972) 1 All NLR (Pt. 1) p. 298.

The Law of Banking, 3rd Edition, Toronto by Ian F. G. Baxtar Opposing, learned counsel for the respondent urged us to hold that exhibit ‘D’ effectively revoked exhibit ‘O’ and ended the co-signatoryship – mandate for the sole signatoryship in exhibit ‘D’.

He observed that the fact that the respondent appointed the second signatory gives him the tight to fire him. Reliance was placed on Practice of Banking, Vol. 1 by Femi Adekanye.

Okomu Oil Palm Co. v. Iserhienrhien (2001) 6 NWLR (pt. 710) 660, (2001) FWLR (Pt. 45) p. 670.

Directly in issue here is:-

Was the bank (the appellant) right to dishonour the respondents cheques dated 12/8/97, 22/9/97, 6/8/97 and 6/10/97, exhibits E, F, G, H, for reason of incomplete mandate. This is important because the learned trial Judge awarded the sum of N1,590,000.00 for the four cheques dishonoured and ordered the appellant (the defendant) to pay the respondent (the plaintiff) the balance outstanding to the plaintiff’s account.

The relation in law between a banker and his customer is that of debtor and creditor, and so when a bank credits the current account of its customer with a certain sum, the bank becomes a debtor to the customer in that sum and conversely when a bank debits the current account of its customers with a certain sum, the customer becomes a debtor to the bank in that sum since the relationship between a banker and his customer is that of debtor and creditor, whichever party is the creditor is entitled to sue, if demand for payment was not complied with. So held the Supreme Court in Yesufu v. ACB Ltd. (3) (1976-1984) 3 N.B.L.R. p. 607, (1976) 1 All NLR (Pt.1) 328.

It follows naturally that where the terms of a written contract are clear and unambiguous effect must be given to the contract, and it is not the duty of the Court to rewrite contracts for the parties. See Union Bank (Nig.) Ltd. v. Ozigi (1994) 3 NWLR (Pt. 333) p. 385: Bookshop House v. Stanley Consultants (1986) 3 NWLR (Pt. 26) p. 87: African Reinsurance Corp. v. Fataye (1986) 1 NWLR (Pt. 14) p. 113. In deciding the terms of a contract or what was agreed by the parties it is always better to look at all the documents passing between the parties and glean from them or from the conduct of the parties whether they were ad idem on all material points or how they expected their relationship to be maintained, bearing in mind that the relationship of banker customer which exists between the parties placed on them, duties, rights and obligation bothering on good faith.

In that regard the banker is to receive cheques from his customer and is bound to pay the cheques drawn on him by a customer provided there are sufficient funds. Where a banker without justification dishonours his customer’s cheques he is liable to the customer in damages for injury to his credit.

In this case, exhibits E, F, G and H were dishonoured by the bank, and the justification according to the bank for dishonouring them was given as “incomplete mandate”.

As regards cheques, it is easy to find out the mandate given to the bank after examining documents completed and signed by the customer when opening the account in question. Although the exhibits in this case are badly mutilated, they are thus difficult to decipher. It is clear though that exhibits ‘M’ and ‘O’ must be considered before resolving the issue of mandate or incomplete mandate.

Exhibit ‘M’ is the sole proprietorship/partnership account form of the bank. It was completed by the respondent when he opened the AL-CLEMENT account on 14/12/89. The signatories to the account are the respondent and Uzoma Onuoha. They are the co-signatories to the account.

According to learned counsel for the appellant exhibit ‘O’ stipulates that the cheques issuing from or drawn on the account must be co-signed by the two signatories.

Exhibit ‘O’ is the specimen signature card of the bank. The signatures of both signatories are on it. Nowhere on it is it said/stated that the cheques issuing from or drawn on the account must be co-signed by the two signatories. It may be inferred since the signature of the signatories are on exhibit O but is not so stated as claimed by learned counsel for the appellant. When a cheque is marked incomplete mandate it means that there is something vital that is missing on the cheque e.g. in a joint account, or where two signatories are required before a cheque is honoured, and only one sign, the bank would be correct to mark the cheque incomplete mandate.

The question to be asked is whether the bank was right to mark the respondent’s cheques dated 12/8/97, 22/9/97, 6/8/97 and 6/10/97. Incomplete mandate and proceed to dishonour them.

On 7/7/97 the respondent wrote exhibit ‘D’ to the Manager of the bank. It is titled “Removal of co-signatory of my account No. 072555017”. It reads inter alia –

I, Prince Amaobi Ugochukwu, Managing Director, AL-CLEMENT Enterprises Operating on account No. 0712555017 of your bank has decided to drop with immediate effect my co-signatory/counter-signer Mr. Uzoma Onuoha.

I regret any inconvenience this may cause you.

Thank you for your usual co-operation.

Exhibit D was signed by the respondent and received by the bank. On page 2 paragraph 2.7 of the appellants brief, learned counsel for the appellant says that:-

Respondent issued a cheque on 8/7/97 for which he was sole signatory and the defendant honoured same, but subsequently dishonoured other cheques dated 12/8/97, 22/9/97, 6/8/97 and 6/10/97 for reason of incomplete mandate.

The learned trial Judge had this to say on this issue:-

“It is elementary banking practice that a mandate in a joint account may be revoked at any time by any of the account holders.”

Learned counsel for the respondent quoted from Practice of Banking, by Femi Adekanye, Vol. 1 at page 36 thus:

“A mandate may be revoked at any time by any of the account holders hence such account must be stopped whenever there is a serious dispute or disagreement.”

Relying on the Law of Banking, 3rd Edition by Ian F. G. Baxtar learned counsel for the appellant observed that the author said:

On the nature of joint accounts that:

The mode of operation of such an account depends of course on the terms of the contract made with the bank, and this contract ought to contain express terms coveting the use of the account. It will normally be desirable to have an agreement in writing between the parties and the banks, specifying how withdrawals are to be made, cheques are to be issued, and similar matters … this agreement regulates the contractual position of the bank and the parties, and, in addition, it is a piece of evidence which the court may take into consideration along with other evidence in determining the intention of the parties in opening the joint account.

The author continues:

“Where the agreement is in standard form provided by the bank its main purpose would seem to be to express the contractual conditions under which the account may be operated as between the bank and the parties.”

The bank (the appellant) honoured the respondent’s cheque dated 8/7/97, signed only by the respondent, immediately after receiving exhibit D, the respondent letter revoking the second signatory to the account.

The appellant subsequently dishonoured respondent cheque exhibits E, F, G and H, signed again only by the respondent.

Section 151 of the Evidence Act states that:

“when one person has, by his declaration, act or omission, intentionally caused or permitted another person to believe a thing to be true and to act upon such belief, neither he nor his representative in interest shall be allowed, in any proceedings between himself and such person or such persons representative in interest, to deny the truth of that thing.”

The above is estoppel. It simply means that a person shall not be allowed to say one thing at one time and the opposite at another time. Estoppel binds both parties and privies and the rule of estoppel is based on equity and good conscience. Put in another way it means that a party is estopped from denying or withdrawing his previous assertion of from going back on his own act, even if it is to tell the truth The reasoning is simple it would promote fraud and litigation if a party is allowed to resile from his own act or representation on which the other part acted.

The object of estoppel has always been to prevent fraud and enthrone justice between the parties by ensuring that there is honesty and good faith at all times.

My Lord, after the respondent wrote, and the bank (appellant) received exhibit D. informing the bank that the second signatory, Mr. Uzoma Onuoha is no longer a co-signatory to the account, the bank honoured the respondents cheque dated 8/7/97, signed only by the respondent. By this act the bank is estopped from subsequently dishonouring the respondent’s cheques. Exhibits E, F, G and H also signed only by the respondent.

Furthermore the second signatory, Mr. Uzoma Onuoha never complained to the bank about the removal of his name as a cosignatory to the account. There was thus no dispute or disagreement between the co-signatories to the account.

The excuse of incomplete mandate does not in the circumstances avail the bank from not honouring exhibits E, F, G and H. Once the bank honoured the respondent cheque dated 8/7/97 after receiving exhibit D it was bound to honour all subsequent cheques signed by the respondent alone. That in effect is in line with the principle and scope of section 151 of the Evidence Act.

I am thus of the firm view that the learned trial Judge was correct in her findings. The bank was wrong to dishonour the respondent cheques, exhibits E, F, G and H for the reason of incomplete mandate or for any reason at all since there was a sufficient fund in the account.

Issue No.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.

Learned counsel for the appellant argued that the orders of the Task Force applied to frustate the contractual relationship between the appellant and the respondent, consequently the appellant cannot be held liable for the breach of contract, since the breach was as a result of the orders of the Task Force reliance was placed on exhibits K, S, T, U. Mazin Engineering Ltd. v. Tower Aluminum (1993) 5 NWLR (Pt. 295) p. 526.

Concluding learned counsel observed that where a contract has been frustrated, as in this case, the question of breach will not arise, as none of the parties can be held responsible for what has happened, contending that the trial Court fell into gross error by stating that “it is elementary legal knowledge that banks are not governed by edicts”.

He urged us to hold that banks are subject to the laws and official acts of the states in which they operate.

Opposing, learned counsel for the respondent observed that the relationship between the parties is governed by Federal Legislation and common law whereas the Task Force is a creation of a State Edict which is not applicable to the relationship between the parties. He argued that a prudent banker faced with the orders of the Task Force to freeze the account of the respondent and transfer same would seek professional legal advice to guide his conduct, and would have taken legal action to vindicate and/or ascertain the position of the law in the light of exhibits ‘S’, ‘T’, ‘U’ and ‘V’.

Concluding he submitted that there was no frustration and the appellant was wrong to obey incompetent order of the Task Force.

Frustration would occur where it is established to the satisfaction of the court that due to a subsequent change in circumstances which was clearly not in the contemplation of the parties the contract has become impossible to perform. The doctrine of frustration has been restricted by the courts to:-

(a) situations where the supervening event destroys a fundamental assumption; and

(b) where force majeure clauses are drafted into the contract.

There must be an event which significantly changes the nature of the contractual rights of the parties that it would be unjust to expect the parties to perform those rights. Some examples are

(1) Where the subject matter of the contract has been destroyed, or is no longer available.

(2) Death or incapacity of a party to a contract.

(3) The contract has become illegal to perform as a result of new legislation.

(4) A contract can be frustrated on the outbreak of war.

(5) Where the commercial purpose of the contract has failed.

Learned counsel for the appellant relied on exhibits K, S, T, U to justify the action of the appellant contending that the contents of the exhibits applied to frustrate the banker-customer relationship between the appellant and the respondent.

Exhibit K is a letter from the appellant bank informing the respondent that an embargo has been placed on his accounts and the funds therein transferred to the Task Force on the Recovery of Public Property and Funds.

Exhibit K is dated 29/9/97.

Exhibit S is dated 24/7/97. It is written by the Chairman of the Task Force on Recovery of Government Property and Funds to the appellant Manager.

It reads in party:-

I wish to refer to an endorsement letter No. GH/PL/S.514/11/784 B of 23/7/97 from Government House and to convey the Military Administrators order that you should not release the sums of N1 million in the deposit account and N10.2 million in the current account of Mr. Amobi Ugochukwu, the Managing Director of AL-CLEMENT of No. 5c Okigwe Road, Owerri.

You should please take immediate action to comply with the Military Administrator’s order and inform the Task Force accordingly.

Exhibit S was signed by the Chairman of the Task Force. Exhibit T is written by the Chairman of the Task Force to the appellant’s Manager.

It reads in part:

In exercise of the powers vested in the Task Force for the Recovery of Government Funds and Property by section 12 of Edict NO.7 of 1985. I hereby direct you to transfer the sum of N9, 222,596.79 (Nine million, two hundred and twenty-two thousand five hundred and ninety-six Naira seventy-nine kobo) and N 1, 017,260.27 (One million seventeen thousand two hundred and sixty Naira twenty-seven kobo) being the current and fixed deposit respectively in account No. 0712555017 standing in the name of AL-CLEMENT/PRINCE AMOBI UGOCHUKWU to Afrik Bank Plc, Owerri for credit to account No. 3670100 IF (Imo State Task Force for Recovery of Government Funds and Property).

Exhibit T was also signed by the Chairman of the Task Force. Exhibit U emanates from the Task Force. It is a summons to the Manager of the appellant bank to appear before the Task Force to explain why he failed to obey the orders to transfer the sums stated in exhibits S and T.

Exhibits S and T show beyond doubt that it was the Task Force that ordered the appellant bank to freeze and transfer the funds in the respondent account to Afri Bank, and exhibit U shows clearly that the appellant’s Manager refused to comply with the orders in exhibits S and T hence the summons.

I must pause at this stage to examine the relevant provisions of the Imo State Recovery of Public Funds and Property (Special Provisions) Edict, 1985. Section 6 states the functions of the Task Force.

It reads:

“6(a) to examine all Government white papers and ascertain all persons identified in the white paper was in any way indebted to Government and surcharged by Government.

(b) to obtain from Government ministries, parastatals etc names of all persons owing or liable to Government and recover the debt and to such other things as may facilitate the recovery of the debt.”

Section 7 states the powers of the Task Force.

It reads:-

7(i)(a) to demand from such persons, co, etc to pay the debt into a special account.

(b) to arrest detain, imprison such person until such a debt is fully paid.

(c) to take possession of and sell by public auction, moveable property.

(2) There shall be opened by Government a special account into a commercial bank into which all accounts recovered in pursuance to provisions of this Edict be paid into.

And section 12 under which the Task Force acted. (See exhibits S and T) reads:

“12. The Task Force has power to fill bank order forms and to inquire from any bank the financial position of the person named therein and upon the receipt of the bank order form freeze the person account and withdraw the amount of the indebtedness.”

White paper means, a public statement of Government policy.

The interpretation of sections 6 and 7 supra and the purpose of the legislation in question is to give powers to the Task Force to recover monies from persons indebted to the Government. These person are named either in the white paper or in documents produced by Government ministries, or parastatals.

Where the Task Force is satisfied that a person is named in the white paper or in documents produced by Government ministries or parastatals it has power under section 12 (supra) to give orders to the bank in which such a person has an account to freeze same and thereafter withdraw the amount to clear the indebtedness. The issue for determination is on what basis the Task Force ordered the appellant to freeze the account of the respondentNo white paper or document emanating from a ministry or parastatal was ever tendered in evidence to justify the directives of the Task Force in exhibits S and T. In these circumstances the provisions of section 149(d) of the Evidence Act becomes very relevant.

It reads:

“149. The court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case, and in particular the court may presume.

(d) That evidence which could be and is not produced would, if produced be unfavourable to the person who withholds it.”

The interpretation of the above is that where a party does not produce or suppresses useful evidence the natural inference is that the evidence if produced would go against the party who withholds it.

Adverse inference may be drawn from withholding material documents by a party in possession of such documents. See: Ogwuru v. Co-op. Bank of E/N Ltd. (1994) 8 NWLR (Pt. 365) p. 685; Jallco Ltd. v. Owoni Boys Tech. Serv. Ltd. (1995) 4 NWLR (Pt. 391) p. 534.

In my respectful view the failure of the appellant (as defendant in the court below) to produce the white paper or documents from the ministry/parastatals etc containing the name of the respondent, as a debtor; or liable to Government of Imo State is indicative of the fact that no such document exists or if it does exist it would be adverse to the appellant because the respondents name would not be in any of the documents.

The Manager of the appellant bank was right initially not to comply with the orders of the Task Force in exhibits ‘S’ and ‘T’ but subsequent compliance with the said orders amounts to the Manager acting arbitrarily and capriciously. A prudent banker ought to have asked for affirmative evidence to justify the orders in exhibits S and T and if not forthcoming seek restraining orders against the Task Force from the court.

The orders in exhibits S and T on which the appellant Claimed to have obeyed did not frustrate the Contract.

This is a clear case of breach of contract which arose simply because the Manager of the appellant bank obeyed illegal orders from the Task Force (exhibits S and T).

Issue No.3

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

Learned counsel for the appellant submitted that by the clear provisions of sections 14and 18(1) of the Imo State Recovery of Public Funds and Property (Special Provisions) Edict, 1985 the trial court was divested of the jurisdiction which it assumed to entertain this suit. Relying on A.-G., Federation v. Sode (1990) 1 NWLR (Pt. 128) p. 500; Madukolu v. Nkemdilim (1962) 1 All NLR 587; (1962) 2 SCNLR 341. He urged us to resolve this issue in the negative.

Learned counsel for the respondent submitted that the court below, a High Court of a State has jurisdiction to entertain matters pertaining to banker-customer relationship. Reliance was placed on section 230(i)(d) of Decree No. 107 of 1993, contending that the jurisdiction is not ousted by sections 14 and 18 of Edict No.7 of 1985 because the respondent is not suing on the acts of the Task Force but on the wrongful act/conduct of the appellant bank which seeks to blame its unreasonable action on the Task Force.

He urged us to hold that the trial court was correct to hold that it had jurisdiction to try the case.

The issue of jurisdiction is fundamental to the question of the competence of the court making any order or giving a decision, and so it must be quickly heard and determined. The reasoning is simple. Absence of jurisdiction renders the entire proceedings a nullity, no matter how well the proceedings were conducted and the case decided. See Madukolu v. Nkemdilim (1962) 1 All NLR p. 587; (1962) SCNLR 341: Osafile v. Odi (No. 1) (1990) 3 NWLR (Pt. 137) p. 130; A.-G. Federation v. Sode (1990) 1 NWLR (Pt. 128) p. 500.

The jurisdiction of a court can only be ousted in the following instances:

(a) Where for example the court is not properly constituted as regards the numbers and qualifications of its members and a member is disqualified for one reason or another.

(b) Where the subject matter of the case is not within the jurisdiction of the court; and

(c) When the case does not come to the Court through the due process of the law and conditions precedent to the exercise of the said jurisdiction has not been fulfilled. See also Sea Trucks Ltd. v. Anigboro (2001) 2 NWLR (Pt. 696) 159, (2001) 1 SC (Pt. 1) p. 56.

The appellant’s submissions seem to centre on (b) above, because he says the jurisdiction of the court is ousted by the provisions of sections 14 and 18 of the Imo State Recovery of Public Funds and Property (Special Provision) Edict, 1985.

It is very well settled that the plaintiff’s claim determines jurisdiction. See Anyah v. Iyayi (1993) 7 NWLR (Pt. 305) p. 290; A.-G., Kwara State v. Warah (1995) 7 NWLR (Pt. 405) p. 120; Onuorah v. Okeke (2005) 10 NWLR (Pt. 932) p. 40.

In this case the respondent as the plaintiff in the trial court sued the appellant (defendant) on a writ of summons and statement of claim for N126, 796,500.00 as general and special damages for dishonouring his cheques drawn on the defendant bank and for conversion or unlawful freezing of the plaintiff’s account with the defendant.

The plaintiff’s cause of action arose in 1997 when the defendant bank dishonoured his cheques. It is a customer/banker relationship gone painfully wrong. The applicable Legislation at the time which determined jurisdiction on customer/banker relationship was/is section 230(i)(d) of Decree 107 of 1993.

It reads:-

“230(1) Notwithstanding anything to the contrary contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly or a Decree, the Federal High Court shall have and exercise jurisdiction to the exclusion of any other Court in civil causes and matters arising from –

(d) banking, banks, other financial institutions, including any action between one bank and other, any action by or against the Central Bank of Nigeria arising from banking, foreign exchange, coinage, legal tender, bills of exchange, letter of credit, promissory note and other fiscal measures:

Provided that this paragraph shall not apply to any dispute between an individual customer and his bank in respect of transactions between the individual customer and the bank.”

The facts show that the plaintiff like any other customer of a bank had/has an account with the bank. He presented his cheques to the bank but his cheques were dishonoured. In the absence of any credible reason for not honouring the plaintiff’s cheques I must hold and do hold that it is a simple customer banker relationship which the proviso in section 230(i)(d) exempts from the exclusive jurisdiction of the Federal High Court. The Imo State High Court was the proper venue for the hearing of the case, and the learned trial Judge was right to assume jurisdiction to hear the case. I now turn to consider the provisions of sections 14 and 18 of the Imo State Recovery of Public Funds and Property (Special Provisions) Edict, 1985. This is important because learned counsel for the appellant says that the said provisions divest the trial court of jurisdiction.

Section 14 (supra) provides that no action shall be instituted or lie against the Task Force or any members thereof for anything done under the Edict.

Section 18 (supra) states that:

“No action shall lie or be maintained in any court of Law in respect of any action taken or anything done in respect of any matter under this Edict.”

Sections 14 and 18 of the Imo State Recovery of Public Funds and Property, (Special Provisions) Edict, 1985 shields the Task Force and its members from any court action.

The trial Judge assumed jurisdiction under section 230(i)(d) of Decree 107 of 1993 to decide a matter between a customer (the respondent) and his bank (the appellant) on a cause of action that arose from customer/banker relationship. Neither the Task Force nor any of its members is a party to the suit and there is no claim against them.

In the circumstances the provisions of sections 14 and 18(supra) or any other section of the Imo State Edict of 1985 cannot apply to prevent the respondent from suing his bank.

The trial Judge was correct to assume jurisdiction in the light of what I have been saying.

Issue NO.4

Whether the operation of the AL-CLEMENT account was not in the circumstances of this case tainted with illegality.

Learned counsel for the appellant observed that the reasonable inference to be drawn in this case is that the respondent was colluding with the said Ugochukwu Unachukwu (co-signatory to AL-CLEMENT account) to defraud the Government of Imo State through the contract.

Concluding he submitted that where the object of either the promise or the consideration is to promote the commission of an illegal act the contract is itself illegal and cannot be enforced.

Reference was made to Alao v. A.C.B. Ltd. (1998) 56/57 LRCN p. 3209, (1998) 3 NWLR (Pt. 542) 339; Ibrahim v. Osim (1987) 4 NWLR (Pt. 67) p. 965.

He urged us to resolve this issue in the positive.

Learned counsel for the respondent observed that where the cause of action of the plaintiff is not ex facie illegal three conditions must be satisfied before the court can take any cognizance of any question of illegality. Reliance was placed on Scott v. Brown Doering Mc Nab & Co. (1892) 2 QB p. 724 contending that none of the conditions were fulfilled.

Finally he submitted that since illegality was not pleaded the issue should be disregarded as a non-sequentur.

The co-signatory to the AL-CLEMENT account was Ugochukwu Unachukwu (also known as Uzoma Onuoha). He was the Special Assistant to the Military Governor of Imo State at the time the respondent was paid by the Imo State Government for contracts he was executing on their behalf. It is in the light of these facts that learned counsel for the appellant says the respondent was colluding with the Special Assistant to defraud the Government of Imo State through the contract.

Blacks Law Dictionary defines an illegal contract thus:-

Contract is illegal where its formation or performance is expressly forbidden by a civil or criminal statute or where penalty is imposed for doing act agreed upon.According to learned counsel for the appellant, since the Special Assistant to the Military Governor of Imo State was a co-signatory to the AL-CLEMENT account, the relationship between the customer (respondent) and the bank (appellant) was illegal.

Illegality does not appear ex facie and it is not pleaded and no evidence was led in support. The Court would not entertain it.

Furthermore a person who is a party to a fraudulent transaction cannot obtain a relief from his wrong doing to the prejudice of his partner in that wrong doing. So also an active participant in an illegal act cannot sue a co-conspirator. See: Quo Vadis Hotel v. N.M.S. Ltd. (1992) 6 NWLR (Pt.250) 653, (1966) 6 NWLR (Pt. 50) p. 664.

In my view the contract was not illegal, and no compelling evidence was led to even remotely suggest that it was illegal. In the absence of evidence the assertion that the contract was illegal resides in the realm of speculation.

Issue No.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 and practice.

Learned counsel for the appellant observed that the refusal by the learned trial Judge to allow the appellant (as defendant) amend its pleadings to plead banking custom amounted to a miscarriage of justice. Relying on Alhaji I. Dantumbu v. Chief P. Adene & Ors. (1987) 4 NWLR (Pt. 65) p. 314.

He urged us to set aside the decision of the trial court.

Learned counsel for the respondent observed that the learned trial Judge was right to refuse the application, contending that the application was brought after the respondent (plaintiff) had closed its case. He submitted that if the amendment was granted the plaintiff would not have had an opportunity to call evidence on the new issue.

Reliance was placed on George & Ors. v. Dominion Flour Mills Ltd. (1963) 1 SCNLR 117, (1963) 1 All NLR p. 71; Mrs. C. I. Adetutu v. Mrs. W O. Aderohunmu and Ors. (1984) 1 SCNLR 515, (1984) 6 SC p. 92.

Amendments to pleadings are allowed for the sole purpose of determining the real question in controversy between the parties. Bearing that in mind the Court would readily give leave to amend a defect in pleadings rather than decide the case in ignorance of facts which ought to have been known before judgment is delivered.

Amendments may thus be allowed at any stage of the proceedings. Before trial or at, or after trial, or even after judgment, or on appeal, but at these stages different considerations apply.

(a) before trial, a plaintiff may change his case by pleading a new cause of action, a new claim and the defendant a new defence.

(b) During trial, amendments would be allowed to bring the pleadings in line with evidence already adduced. See Udechukwu v. Okwuka (1956) SCNLR 189; (1956) 1 F.S.C. p. 70; Ewarami v. A.C.B. Ltd. (1978) 4 SC p. 99.

(c) After trial or close of address the court would be very slow at granting an amendment of pleadings. The court would grant an amendment at this stage if the court is satisfied that evidence on such amendment has already been led and admitted or where the matter has been raised in court and argued upon. See Taiwo v. Akinwunmi (1975) 4 SC p. 143.

(d) In Kode v. Yesufu (2001) 4 NWLR (Pt. 703) 392, (2001) 2 SC p. 99. The Supreme Court held that an amendment could be allowed at anytime provided the amendment is not intended to overreach, or will entail injustice to the other party or that the party seeking the amendment is acting mala fide.

At the trial court an application by the appellant (defendant) to amend its statement of defence after the respondent (plaintiff) had closed his case was refused by the learned trial Judge.

The amendment sought was to plead banking custom or practice.

I must observe that the application to amend was made after the plaintiff had closed his case. If the application was granted the plaintiff would have been unable to call evidence on the new issue.

He would thus have been denied a fair hearing. In my respectful view the learned trial Judge was right to refuse to grant the application to amend.

Award of excessive cost of action

The trial court awarded N100, 000 as cost of the action. Learned counsel for the appellant did not make it a ground of appeal, but invited this court to pronounce on the propriety or otherwise of such excessive award of cost.

He observed that the learned trial Judge did not hear the parties on cost before the award was made, contending that the award of N100,000 cost was excessive and unsupportable and cannot stand.

Reliance was placed on Agbehomovo v. Edujegbe (1999) 3 NWLR (Pt. 594) p. 170; Wurno v. U.A.C. Ltd. (1956) 1 FSC p. 33. Learned counsel for the respondent urged us to discountenance the issue of award of cost on the ground that there is no ground of appeal on this issue.

Finally he observed that this court can only interfere and set aside the award if of the view that the learned trial Judge did not exercise her discretion judicially.

The position of the law is that where an issue does not arise from any of the grounds of appeal it ought to be struck out. See: Mkpedem v. Udo (2000) 9 NWLR (Pt. 673) p. 631; Ebo v. N.T.A. (1996) 4 NWLR (Pt. 442) p. 314; U.T.B. (Nig.) Ltd. v. Ajagbule (2006) 2 NWLR (Pt. 965) p. 447.

In this appeal the appellant filed six grounds of appeal, and the issue of costs did not arise from any of the appellant’s grounds of appeal. Since the issue of costs is not covered by any of the grounds of appeal filed it is incompetent and will be struck out.

It is accordingly struck out.

In the end this appeal fails and it is hereby dismissed with costs assessed at N 10,000.00 in favour of the respondent.

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Other Citations: (2007)LCN/2593(CA)