Razaq A. Balogun V. African Continental Bank Ltd & Ors (1972)

LawGlobal-Hub Lead Judgment Report

SIR I. LEWIS, J.S.C. 

In Suit No.LD/190/68, the plaintiffs’ Statement of Claim read:-

“The Plaintiffs are Bankers incorporated as a Limited Liability Company under the Companies Act with their registered Head Office at 148, Broad Street, Lagos and registered Branch Office at 27/29, Martins Street, Lagos.

The defendants are Fish Sellers at 228, Bamgbose Street, Lagos carrying on their business under the Name of Ore-Ofe Women Fisheries Company.

1. On 26/3/63, the defendants opened a current account with the plaintiffs under the Name of Ore-Ofe Women Fisheries Company.
2. At the time of opening the account the three defendants were the only signatories to all the cheques drawn on the plaintiffs on behalf of the Trading Concern.

2a. The three defendants are the Managing Director, Directress and Secretary of the Trading Concern.

3. The defendants operated the account on credit basis until about 11/9/64 when the plaintiffs’ General Manager approved a loan of 2,000 pounds to the defendants.

4.The defendants continued to operate the account which left a balance of 4,100:5s.1d(pounds) inclusive of Bank Charges and Interests at the rate of 9% per annum.”

and the 1st defendant in paragraphs 2, 3 and 6 of his Statement of Defence pleaded:

“2. The Partnership known as Ore-Ofe Women Fisheries Company has wound up about 2 1/2 years ago and is no more doing any business.

3.The 1st defendant avers that he was never a partner in the Partnership business concern trading under the name and style of Ore-Ofe Women Fisheries Company. The 1st defendant further contends that he was only an agent of the said Partnership.

6. The 1st defendant avers that he did not apply for or obtain any overdraft or loan from the plaintiffs for and on behalf of the partnership trading under the name and style of Ore-Ofe Women Fisheries Company.’

and the 2nd and 3rd defendants in paragraphs 1, 3 and 5 of their Statement of Defence pleaded:

“1.The 2nd and 3rd defendants were Fish Sellers and they were partners with some other persons in the partnership known as Ore-Ofe Women Fisheries Company. But the 2nd and 3rd defendants aver that the partnership has ceased functioning more than 2 1/2 years ago.

3. The 2nd and 3rd defendants aver that they did not apply for or obtain any loan or overdraft from the plaintiffs; and that they are not indebted to the plaintiffs at all.

5.The 2nd and 3rd defendants aver that their partnership concern known as Ore-Ofe Women Fisheries Company is in no way indebted to the plaintiffs.”

It was not in dispute that the 1st defendant in company with the 2nd and 3rd defendants went in March, 1963, to the bank of the plaintiffs and asked to open an account in the name of Ore-Ofe Women Fisheries Company, and that the 1st defendant then described himself as the Managing Director of that partnership and that the 2nd and 3rd defendants described themselves as Director and Secretary respectively and that the three of them arranged to sign all cheques drawn on behalf of the Ore-Ofe Women Fisheries Company. It was also not in dispute that the 2nd and 3rd defendants were partners in the Ore-Ofe Women Fisheries Company. What was in dispute was the status of the 1st defendant in the matter, that is to say whether he was a partner in the Ore-Ofe Women Fisheries Company or whether he had held himself out to the plaintiffs to be such a partner, and whether the partnership in fact asked for and obtained an overdraft on their account with the plaintiffs of which they were aware from receiving statements periodically from the plaintiffs without disputing them so that by January, 1966, that overdraft amounted to the sum of 4.100:5:10d(pounds) which was the amount claimed by the plaintiffs in the present action. On the 9th of May, 1969, Sowemimo, J., found for the plaintiffs and awarded them 4,100:5:10d(pounds) together with 60 guineas costs against all the defendants jointly and severally. Against that decision all the defendants filed notice of appeal but before us only the 1st defendant continued with his appeal and we accordingly dismissed the appeals of the 2nd and 3rd defendants on the 20th of December, 1971.

Mr. Akinrele for the 1st defendant argued on his behalf his ground of appeal that read: