Sola Adio Olusesi V. The State (1970)
LawGlobal-Hub Lead Judgment Report
FATAI-WILLIAMS, J.S.C.
In Charge No. LN5C/69 in the High Court of Lagos the two accused persons stood trial upon an information containing thirteen counts-twelve of fraudulent false accounting and one of stealing.
The first accused (Sola Adio Olusesi) was charged alone in six of the counts with fraudulent false accounting, the particulars of each of which stated that being a clerk employed by the John Holt Shipping Services Ltd., Apapa, he omitted from the cash-book of the said company, on a specified date and with intent to defraud, a particular sum of money received on that specified date from the Barclays Bank at Apapa.
The second accused (Clarence Igoinfa) alone was also charged in six of the remaining seven counts with fraudulent false accounting. The particulars of each of these stated that being a clerk employed by the same John Holt Shipping Services Ltd., Apapa, with intent to defraud, he was privy to each of the omissions, specified in the first six counts, made by the first accused from the cash-book of the said company.
In the thirteenth count, they were jointly charged with stealing. The particulars of this last count stated that the two accused persons between 1st December, 1966, and 20th October, 1967, at Apapa, being the clerks employed by the said John Holt Shipping Services Ltd., Apapa, stole the sum of 3,222pounds:0s 6d (Le. the total of all the sums omitted from the cashbook), property of the said company.
After their arrest in connection with the offences shown in the charge, the 1st accused made the statement (exhibit 70) to the police in which he said, inter alia, as follows:-
“Mr Igoinfa my immediate boss used all the money mentioned by himself to redeem his LO.V. We checked my cashbooks daily and signed my cash-books as being correct because he was the one who instructed me not to make correct entries into the cash-books and as he was the one making use of the said amounts. I knew at the time he was making use of these amounts that he was making use of the company’s money and not his own personal money.
Any time I query him about these money, he use to tell that I should not worry and that he was going to write them off. I did not use any of the aforesaid amounts for my benefit. It was Mr Igoinfa who made use of all the money. He is the accountant and the manager and he has all the powers to do whatever he likes in the company and I was not in a position to query his authority.”
In his own statement (exhibit 72) regarding the cheques covering the said amounts, the 2nd accused stated as follows:-
“I do not know anything about them. I did not at any time ask Mr Olusesi our cashier not to enter them into the cash-books. Though I do check the cash-books and sign the cash-books as being correct but I did not see any where these cheques were posted in the cash-books.”
In order to get a panoramic picture of the sequence of events, it will be necessary to set out in more detail than usual the evidence led at the trial. Those documents, and many were indiscriminately tendered at the trial, which appear to us irrelevant for the purpose of this appeal, will, however, be disregarded.
Testifying for the prosecution, Peter Edwin Cheer (4th P. W.) the adminis-trative manager of the John Holt Shipping Services Ltd., Apapa, (hereinafter referred to as the company) stated that at the material time, the 1st accused was the company’s cashier and that his duties as cashier were to look after the cash and to write up the cash-books of the company.
These cash-books are exhibits 1 to 4. The 1st accused as cashier was directly responsible to the 2nd accused, another employee of the company, whose duty, among others, was to check the four cash-books everyday and to sign the relevant entries if he was satisfied that they had been properly made and that they were arithmetically correct. It was also his duty to check, once a month, and the bank reconciliation statements which showed the differences between the balance in the cash-book and the balance in the bank statements.
The bankers of the company are the Barclays Bank, Apapa. The normal way to discover any omission from the cash-book was when the reconciliation statement was checked at the end of each month.
In order to withdraw any money from the bank, continued the witness, a cash voucher was prepared for the sum required. The voucher was usually prepared by the 1st accused and was then taken to any member of the managerial staff (of which 2nd accused was one) for signature. After it had been signed the 1st accused would make out a cheque for the authorised sum. The cheque was then taken to one of the company’s officials authorised to sign such cheques for signature. After it had been signed the 1st accused would cash the cheque at the bank. On his return to the office, he would put the money in his cash-box and later the same day record the transaction in his cash-book.
The 4th P.W. then proceeded to show that eleven cheques (exhibit 8 to 18) issued by the company between 1st December, 1966 and 20th October, 1967, were all made out for cash and were all cashed by the first accused as cashier. Among these eleven cheques, all drawn on the Barclays Bank, Apapa, were the six which formed the basis of the charges of fraudulent false accounting brought against the two accused persons. The particulars of the six cheques are as follows:-
(a) Cheque for 300pounds 0s 0d cashed on 1-12-66 (exhibit 8)
(b) Cheque for 565pounds 1s 4d cashed on 3-1-67 (exhibit 10)
(c) Cheque for 300pounds 0s 0d cashed on 2-5-67 (exhibit 12)
(d) Cheque for 200pounds 0s 0d cashed on 4-8-67 (exhibit 14)
(e) Cheque for 213pounds 5s 1d cashed on 17-10-67 (exhibit 16) (f) Cheque for 300 0s 0d cashed on 20-10-67 (exhibit 18)
The total amount received by the first accused on these eleven cheques was 3,222pounds 0s 6d. None of the amounts shown on each of the cheques was entered, as it should have been done, in any of the relevant cash-books (exhibit 1 to 4). The effect of the omission was that the first accused who had to account for the sum of 3,222 0s 6d made it appear that it need not be accounted for. Although the amount was drawn by the cashier there was no trace of what he did with it.
Dealing with the reconciliation statements which, if correctly checked by the 2nd accused, would have disclosed the omission, the 4th P.W. testified further as follows:-
“The documents to be used for the reconciliation for each month are the cash-book, bank statements with supplementary list, the bank’s deposit book or tellers.”
Explaining how the reconciliation statements were prepared every month, the 4th P.W. pointed out that the normal procedure was for someone else to prepare the statements while the second accused would check the statements and satisfy himself that they were correct.
Another witness called by the prosecution was Sarumi (7th P.W.) who stated that payments made to the company by cheques but not yet paid into the bank should have been shown in detail “cheque by cheque” in the reconciliation statements on exhibits 14 instead of being lumped together as “forward payments”. He also pointed out that if details of these “forward payments” had been given in the statements, one would have seen if the correct amount shown on each cheque had been entered and thereby discovered any fraud or defalcation. As the entries against the “forward payments” in the reconciliation statement at page 111 of the cashbook (exhibit 1) stood, the amount of 6,891 19s 3d, for example, could include genuine as well as fictitious sums.
Agoro (8th P. W.) another employee of the company whose duty was to prepare the monthly reconciliation statements for the approval of the 2nd accused testified as follows:-
“The reconciliation was normally done once every end of the month. When preparing the reconciliation, the bank statement was always ticked off with the cash-book references against cheques presented to the bank. Anyone without a cash-book reference and a statement means that it has not been treated in the cash-book. Besides the bank statements, receipt books, bank teller books will have to be used for the reconciliation.
Also the counterfoil of the cheques. When I finished my reconciliation I used to pass my return to the 2nd accused person who was then our Apapa accountant. I used to pass the draft reconciliation to him and not the actual reconciliation. He would look into it and give his instructions. My drafts always disclosed all the discrepancies. At this time there were several discrepancies. The 2nd accused person then instructed me at that time that the discrepancies should be lumped up in the forward payment. I kept record of all drafts. In actual fact the 2nd accused instructed me that these drafts were to be destroyed. In spite of this I kept all the drafts. I have them in two files which I produce.”
The witness then tendered the two files as exhibits 77 and 78. He explained that the first page of exhibit 77 contained his draft reconciliation statements wherein he pointed out that some cheques which had been cashed and which appeared in the bank statements had not been accounted for. The entry for the month of September 1967, on the back of the first page in the file exhibit 77 is as follows:-
“Cheque 09119 to be alc for on CB 565pounds 1s 4d 09208 to be alc for on CB 208 13s 1d 08692 to be alc for on CB 300 0s 0d 08863 to be alc for on CB 235 1s 0d 08253 to be alc for on CB 300 0s 0d
012114 to be alc for on CB 200 0s 0d.”
When Agoro pointed this omission out to the second accused, he asked him (Agoro) to “lump them up” with the forward payments which then showed a total of 10,070pounds 14s 5d as shown in exhibit 77. This kind of action, according to Agoro, occurred throughout the period. He then explained that all the cheques referred to above were issued before the month of September 1967. This is confirmed by the entries in the earlier draft reconciliation statements in exhibit 77.
It is, we think, pertinent to point out at this stage that three of the above cheques [No. 09119 for 565 1s 4d (exhibit 10), No. 08692 for 300 (exhibit 8) and No. 012114 for 200 (exhibit 14)] relate to three of the counts of fraudulent false accounting and are also involved in the charge of stealing in count thirteen. Finally, Agoro admitted that the reconciliation statements were “cooked” but stated that since the second accused wanted it that way and was the person who had responsibility for it, he (Agoro) had to do it the way the second accused wanted it.
In his defence, the 1st accused admitted that he cashed all the six cheques (exhibits 8, 10, 12, 14, 16 and 18) as well as five other cheques. He also admitted that he did not make any entries about the amounts in his cash-books because “his boss” the second accused asked him not to post them in the cash-books.
He then explained that monies realised from the cashing of the cheques were used by the second accused to redeem his I.0.U.s on which he had previously borrowed money from him. He also pointed out that the 2nd accused did not query him about the omissions because he was the one who used the sums omitted. Under cross-examination, he made the following additional admissions:-
“I admit that at the time I drew the cheques on exhibits 8 to 18 it was my duty to enter these entries in the cash book. I admit that I did not make the entries. The 2nd accused asked me not to make them. It is true that the sum involved was 3,222pounds.
When the second accused asked me not to make the entries I knew I was helping him to steal that money. After second thoughts I knew, I was assisting him all along because he instructed me. I only came to know later on that he was duping the company. I came to know that he was using me to steal the money from the company. .. The persons authorised by the company to sign cheque vouchers and authorise them were Messrs Cheer and Jackson and the accused.
The ones subject -matter of this case were all signed and authorised by the second accused.”
In his own defence, the 2nd accused denied giving Agoro (8th P.W.) any direction as to how to prepare the bank reconciliation statements. He also denied giving him any instructions with regard to “forward payments” in the reconciliation statements or telling him to “lump up” the “forward payments” in order to hide defalcations. He said Agoro never told him that he had discovered any such defalcations. He admitted, however, that he checked all the reconciliation statements and signed them. Under cross-examination, he admitted that he was in charge of the company’s accounts department at Apapa, and that it was his duty to see that the department was running well.
He also admitted that the cash-books and reconciliation statements were books of accounts and that it was his duty to see that the books of accounts were kept properly. Referring specifically to the cash-books, he made the following admissions:-
“I checked the cash book every day. The purpose of my checking the cash-book is to make sure that the petty cash on hand agrees with what is in the cash-book. I admit that I have to check each voucher entered by the cashier into the cash-book. As he pays out these vouchers he numbers them and enters them in the cash-book. All these I have got to check….. It is my duty to see that the cash-book is correctly kept.”
With respect to the reconciliation statements, the second accused testified further as follows:-
“It was the reconciliation clerk whose duty it was to see the supplemen-tary list and check it with his reconciliation statement. I admit that I was checking the reconciliation statement….. It is true that the reconciliation clerk ought to list the cheques which are stated in the bank statements but which the cashier has not shown in his cash-book. I admit that the process of reconciliation means bringing together the John Holt Shipping Services accounts with the Bank’s state-ments of accounts. I admit that the bank reconciliation is a most impor-tant aspect of the company’s accounts…. I admit that it was my duty to check the reconciliation statement.”
When confronted with the draft reconciliation statement contained in the
file (exhibit 77) prepared by Agoro (8th P.W.), the second accused observed::-
“I never saw any draft by Agoro for September 1967. I did not see this one; I see it now that this page of exhibit 77 says-The following cheques are to be accounted for in the cash book… I admit that some of these cheques were those cashed by the cashier and the subject matter of the monies stolen.
I did not see this draft but I admit that he was pointing out there that these cheques had not been posted in the cash-book. The amounts were 565pounds 1s 4d, 208 13s 1d, 300, 235:0s 0d, 300 and 200. This was over 1,500….. I admit that in the final reconciliation for September 1967 the reconciliation was done in such a way as to hide the deficiency which was shown in the draft. I admit it had been cooked. These drafts in exhibits 77 and 78 are all in the writing of Agoro. There was no reason why Agoro should take the trouble of preparing the drafts only to keep them in the office and submit a fictitious reconciliation. It is not true that I instructed Agoro to do it in the way it appears in September 1967 because reconciliation could not be done otherwise.”
It was not disputed, and the learned trial judge so found, that the first accused person was the cashier of the company at the material time and that it was his responsibility to look after the cash of the company and to write up the cash-books (exhibit 1 to 4). He also found that at the relevant time the 2nd accused was the accounting manager of the company to whom the first accused was responsible. He further found as follows:-
“There is also evidence which I accept that the 1st accused carried out his duties under the supervision and control of the 2nd accused. With regard to the reconciliation statement evidence was led, and I accept it, that the 2nd accused had responsibility for the preparation of the reconciliation statement after satisfying himself that the statement represented the true statement of affairs.”
After finding that it had been clearly established by the prosecution that the 1st accused cashed the cheques (exhibit 8 to 18) and used the money for purposes other than those of the company, the learned trial judge then proceded to find further as follows:-
“The 1st accused admitted that he knew that by omitting to make these entries he was assisting the 2nd accused to make away with the money of the company. Even if it was true that the 1st accused did not obtain any financial advantage from the actions credited to him by the prosecution it was quite clear to him that the acts upon which he embarked were felonious.”
He then convicted him of the offences with which he was charged in the first six counts of the information after finding finally as follows:-
“I am satisfied without any shadow of doubt on the evidence adduced that the 1st accused with intent to defraud omitted to enter into the cash book of his employers, which entries he had a duty to make the particulars of the cheque exhibit 8 for 300 on 1st December, 1966; the cheque exhibit 10 for 565pounds 1s 5d on 3rd January, 1967; the cheque exhibit 12 for 300 on 2nd May, 1967; the cheque exhibit 14 for 200 on 4th August, 1967; the cheque exhibit 16 for 213 5s 1d on 17th October, 1967; and the cheque exhibit 18 for 300 on 20th October, 1967. These cheques and the transactions relating to them are subject matter of counts 1 to 6 of the indictment.”
In considering the case against the 2nd accused, the learned trial judge, ex abundanti cautela, treated the testimony of Agoro (8th P.W.) as that of an accomplice. He held the view, however, that their testimony was amply corroborated by other witnesses, such as Cheer, whose testimony he believed, and by the documents tendered in evidence. With respect to the testimony of the 1st accused, the trial judge referred to ten instances of corroborative evidence, one of which we quote hereunder:-
“Exhibit 49 and 50 are two cash vouchers on which the 2nd accused received 8 and 5 respectively from the 1st accused on 11-10-67 and 13-10-67. Asked whether he ever paid this money back he said the company had deducted the sums from his entitlement. Exhibit 91, the statement of his account with the company, shows that this was never the case.”
With respect to the testimony of Agoro, the judge found that the whole purpose of the monthly reconciliation statement was to prevent any loss to the company by ensuring that every expenditure by the company was duly entered and accounted for. He also found that the draft reconciliation statements in Agoro’s files (exhibits 77 and 78) were properly made therein and disclosed all the discrepancies which the final statements signed by the 2nd accused concealed and that it was clear from the appearance of the files and the draft statements themselves that they were prepared on the dates shown on them. Regarding the final reconciliation statements signed by the 2nd accused, the judge found as follows:-
“The fact that the 2nd accused signed these false reconciliation statements which are so obviously false; that the draft reconciliation statements in exhibits 77 and 78 showed the correct position and were made at the time; and that the supplementary lists exhibits 79 to 83 show clearly the true position, support the story told by Agoro. The 2nd accused gave the impression that all he was expected to do was ‘snap check’ the reconciliation statements. The evidence of Cheer, and Sarumi, not to mention that of Agoro, belie that statement.”
In convicting the 2nd accused of the offences in counts 7 to 12 he found as follows:-
“It had been clearly established that the 2nd accused had acted with intent to defraud the company. For this purpose he procured false entries to be made in the reconciliation statements to hide various fraudulent acts and deficiencies. He also procured the non-entry into the cash-book of the particulars, subject-matter of counts 7 to 12. He was privy to these omissions…………..
With fraudulent intent he was privy to the non-entries of material particulars in the books of the company and I am of the view that he can be properly convicted on the 7th to the 12th counts of the indictment and I find him guilty on those counts.”
With respect to the charge of stealing in the 13th count of which they were both jointly convicted, the trial judge also made the following finding:-
“I have come to the conclusion that the 2nd accused, in order to hide the fact that he was drawing moneys of his employers instructed the 1st accused not to make proper entries in the cash-book and also instructed Agoro to prepare the reconciliation statements in such a way as would hide the money he had stolen. I reject the suggestion that the 1st accused and Agoro were in any conspiracy. On the contrary I find that the 1st and 2nd accuseds were in conspiracy in this unhappy affair although the 2nd accused stood principally to benefit from it all. I am of the opinion that the 1st and 2nd accused persons were parties to the offence of stealing within the meaning of section 7 of the Criminal Code.”
In the appeal now before us, Chief Williams, for the 1st accused, complained that there was insufficient evidence to warrant the conviction of the 1st accused of the offences charged. Having regard to the admission made by him in the statement (exhibit 70) which he made to the police soon after his arrest and his testimony before the court which confirmed this earlier admission (both of which we have referred to earlier), we are unable to see how the 1st accused could have escaped the conviction which followed. His appeal on all the counts is completely devoid of merit.
We will now proceed to consider the appeal of the 2nd accused. The first point taken by Mr Ajayi who argued the appeal with remarkable ingenuity was that there being no duty placed upon him to make the relevant entries in the cash-books (exhibit 1 to 4), the 2nd accused could not legally be charged and convicted in the 7th, 8th, 9th, 10th, 11th and 12th counts of being privy to the omission to make these entries. In considering this submission we will refer to the provisions of section 438(a) and (c) of the Criminal Code under which he was charged.
The section reads:- “438 Any person who, being a clerk or servant, or being employed or acting in the capacity of a clerk or servant, does any of the following acts with intent to defraud:-
(a) destroys, alters, mutilates, or falsifies, any book, document, valuable security, or account, which belongs to or is in the possession of his employer, or has been received by him on account of his employer, or any entry in any such book, document, or account or is privy to such act: or
(b)……
(c) Omits, or is privy to omitting, any material particular from any such book, document, or account; is guilty of a felony, and is liable to imprisonment for seven years.”
To our mind, “privy to omitting” means no more than having knowledge of the omission. Mere knowledge of an omission, unless it is his duty to make the entry, does not make a person criminally liable for the omission. Much more is necessary. It seems to us that under section 438(c) of the Code, the prosecution must prove, not only that the accused omitted to make the entry but also that it was his duty to have made it.
Compare the case of The King v. Oliphant [1905] 2. K.B. 67, referred to by Mr Ajayi, in which the accused, who was based in Paris and whose duty was to enter on slips an account of all sums received by him in Paris for his employers and to transmit these slips to them in London for entry in his employers’ “Paris cash-book” in London, omitted to enter the receipt thereof of three sums of money received by him for his employers on the slips sent by him on one occasion, knowing and intending that these sums of money would in consequence be omitted from the said “Paris cash-book” in London. In his unsuccessful appeal against a conviction under section 1 of the Falsification of Accounts Act, 1875, for omitting or concurring in omitting, material particulars from the said “Paris cash-book” in London, Channel, J. observed, rightly in our view, as follows:-
“I think that to justify a conviction under this statute the person charged must have had something to do with the keeping of the book in question. That, of course, is a question which must depend, not upon any principle of law, but upon the particular facts of each case;”.
We see no difference in principle between “concurring in omitting” as required by the English Act and “privy to omitting” which is what is required in our section 438(c) of the Code.
While we agree with Mr Ajayi’s submission that the prosecution must prove, not only that the 2nd accused, charged as it were as “privy”, omitted to make the entries complained of, but also that it was his duty to have made them, there is evidence which the learned trial judge accepted that the 2nd accused was also responsible for seeing that the cash-books (exhibits 1-4) were kept properly. As a matter of fact, the 2nd accused, as we have pointed out earlier in this judgement, had himself admitted that it was his duty to see that the cash:-books were “correctly kept”. That being the case, it seems to us that he had a joint duty with the 1st accused for the keeping of the cash-books and cannot escape this responsibility just because he did not physically make the entries himself. We are in no doubt, therefore, that it was his duty to ensure that the omitted sums were entered in the cash-books. For these reasons having regard to the evidence which the court accepted, we are satisfied that the learned trial judge was entitled to come to the conclusion that he did that the 2nd accused was a privy to the omission made by the 1st accused. As the learned trial judge clearly convicted the 2nd accused because he was privy to the omission, it is unnecessary to consider the excursions of the learned trial judge into the applicability of section 7 of the Criminal Code.
Mr Ajayi then dealt with the question of corroboration of the testimony of the 1st accused and of Agoro (8th P. W.) both of whom the learned trial judge treated as accomplices, and submitted that, on a close examination of them, only one of the ten pieces of evidence regarded in his judgement as corroboration could be considered as such. He further contended that as that one was not even strong enough to sustain a conviction; the trial judge erred in law in convicting the 2nd accused on the uncorroborated evidence of these two accomplices. The efforts of Mr Ajose Adeogun, the Principal State Counsel, who appeared for the respondent, in justifying the finding of the learned trial judge in this respect did not greatly assist us. Suffice it to say, therefore, that, in our view, of all the pieces of evidence which the learned trial judge regarded as corroboration only one could be so regarded, and this has, in fact, been conceded by Mr Ajayi. This evidence relates to two cash vouchers (exhibits 49 and 50) by virtue of which the 2nd accused received from the 1st accused the sums of 8 and 5 respectively on 11-10-67 and 13-10-67. The statement of account of the 2nd accused (exhibit 91) which covered the relevant period showed that these amounts were never refunded.
By itself, this fact might not have been sufficient to warrant the inference that the 2nd accused was a party to the fraud which had been admitted by the 1st accused. With this, however, is the evidence of Cheer (4th P.W.), whom the judge believed, that the normal way to detect any omission from the cash-book was when the reconciliation statement was checked at the end of each month. We also recall his testimony that the documents used in checking the reconciliation statement are the cash-book, the bank statements, and the tellers. Added to all these is the admission of the 2nd accused that it was his duty to see that the cash-book was correctly kept and that he checked it every day; that it was also his duty to check the reconciliation statements which he knew to be a most important aspect of the company’s accounts and that he was checking them. He also admitted that the final reconciliation statements signed by him were prepared in such a way as to hide the deficiencies shown in Agoro’s draft. As a matter of fact, he signed one such reconciliation statement at page 88 of the cash-book (exhibit 2) after stating in his own handwriting at the end of the statement:-
“Checked and found correct as entered.”
He must have known that the amount of 18,439pounds 16s 11d entered as “forward payments” in this particular reconciliation statement included sums which had not been entered in the relevant cash-book. In view of all these, we are of the view that there was abundant corroboration of the evidence of the 1st accused and Agoro. Because of his own admissions and of his endorsement at page 88 of exhibit 2, we do not see how the trial judge could avoid coming to the conclusion that he participated fully in the fraudulent acts committed by the 1st accused. We are therefore, unable to see any merit in this ground of appeal.
Despite the error of the learned trial judge in ascribing items as corroboration, most of which in our view we have indicated were not, nonetheless, in the face of the other overwhelming evidence which the learned trial judge accepted, rightly in our view, to which we have referred, the verdict with respect to the 2nd accused is certainly not one with which this Court ought to interfere as there is plainly no miscarriage of justice.
As we have stated earlier the appeal of the 1st accused was devoid of merit. The appeals of the 1st and 2nd accused are accordingly dismissed.
SC.248/1969 (-1)
