ASIKPO v. ACCESS BANK

CITATION: (2015) LPELR-25845(CA)

In the Court of AppealIn the Calabar Judicial Division

Holden at Calabar

ON THURSDAY, 18TH JUNE, 2015Suit No: CA/C/16/2014

Before Their Lordships:

CHIOMA EGONDU NWOSU-IHEME Justice, Court of AppealONYEKACHI AJA OTISI Justice, Court of AppealPAUL OBI ELECHI Justice, Court of Appeal

BetweenOBONG-IFIOK (DR.) ANNY ASIKPO(Trading under the name and style Of ABBNNYEDUCATIONAL PUBLISHERS)

- Appellant(s)

AndACCESS BANK PLC - Respondent(s)

RATIO DECIDENDI1. ACTION - PLEADINGS: Whether allegation of fraud must be

specifically pleaded"An allegation that figures are manipulated borders on fraud,something dishonest and morally wrong. Particulars of the fraud mustbe pleaded and the allegation proved beyond reasonable doubt;Section 135(1) of the Evidence Act, 2011. See also Olufunmise v.Falana (1990) 3 NWLR (PT 136) 1, (1990) 4 S.C. 174; Babatunde v.Bank of the North Ltd (2011) LPELR-8249 (SC)."Per OTISI, J.C.A. (P. 25,Paras. A-C) - read in context

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2. ACTION - COUNTER-CLAIM: General principles of law with respect tocounter-claim"It is well settled that a counterclaim is a separate and independentaction from that in which it was raised. The counterclaimant bears theburden of proving his counterclaim by presenting substantial credibleevidence; Kyari v. Alkali (2001) 5 S.C. (Pt 11) 192."Per OTISI, J.C.A. (P.40, Paras. A-B) - read in context

3. BANKING LAW - INTEREST ON CREDIT FACILITIES: General rule asto payment of interest on a debt or loan and its exception"It is well settled that by practice, usage and custom of banking, bankscharge interest on loans, overdrafts and other financial facilitiesgranted to their customers. As long as a credit facility of whatevernature is granted to a customer by a bank remains outstanding, thebank is entitled to charge interest thereon. This is simply because it ispart of the business of banking to grant credit facilities, and since it isnot a charity organization, it must charge reasonably for thatservice."Per OTISI, J.C.A. (P. 20, Paras. C-D) - read in context

4. BANKING LAW - COMPOUND INTEREST: Whether a bank is allowedto charge compound interest where there is no express agreement"While it is expected that such interest charged must be agreed uponby the parties, it has been held that interest may be charged evenwhere no express interest is made a term of the facility. The SupremeCourt, per Obaseki, JSC in Barclays Bank (Ni) Ltd v. Abuhakar (1977)LPELR-750 (SC), (1977) 10 S.C. 7 put it this way:Where there is no express agreement, it is settled law that the Bank isentitled to charge compound interest on the basis that there is acustom to that effect or that the customer has impliedly consentedwhere without protest he allows his account to be debited.See also Diamond Bank Ltd v, Partnership Investment Co Ltd (2009)LPELR-939(SC), (2009) 18 NWLR (PT 1172) 67; UBA Plc. v. Lawal(2007) LPELR-9042 (CA)."Per OTISI, J.C.A. (Pp. 20-21, Paras. E-C) - readin context

5. BANKING LAW - CENTRAL BANK: Powers of the Central Bank"A bank's power to charge interest on loans, overdraft and otheradvances has become a matter of law, vested in the Central Bank ofNigeria and not just a matter of mutual consultation between the bankand its customer; Section 15 Banking Act, Cap 29, Laws of theFederation of Nigeria, 1990. See further: Union Bank v. Ozigi (1994) 3NWLR (Pt.333) 385; Union Bank Plc v. Ajabule (2011) LPELR-8239(SC)."Per OTISI, J.C.A. (P. 21, Paras. C-E) - read in context

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6. BANKING LAW - INTEREST ON CREDIT FACILITIES: How the termsof an agreement for a credit facility can be varied"It may not be unheard of to find a bank which loads un-reasonablecharges on its customer. If such charges were not voluntarily agreedupon prior to the grant of the facility, they may not be enforceable. Butwhere a party voluntarily agrees to such unreasonable charges prior tothe grant of the facility, the party may not be permitted to retract fromit.Parties are bound by the contents of any lawful written agreement dulyexecuted by them; Anyoegbunam v. Osaka (2000) 3 S.C. 1; AfricanInternational Bank Ltd v. Integrated Dimensional System Ltd (2012)LPELR-971(SC).It is trite that an agreement written and executed by the partiescannot be varied by oral evidence; Koiki v. Magnusson (1999)LPELR-1697 (SC), (1999) 5 S.C. (Pt.111) 30; Egharevba v. Osagie(2009) 18 NWLR (PT 1173) 299 S.C. The parties are bound by theterms of that agreement. An agreement which seeks to vary theoriginal written agreement must also be in writing; Baliol Nigeria Ltd v.Navcon Nigeria Ltd (2010) LPELR-717(SC), (2010) 16 NWLR (Pt. 1220)619 SC; Bilante International Ltd v. NDIC (2011) LPELR-781(SC).Therefore an agreement to vary the terms of an earlier agreement fora credit facility must also be in writing to be enforceable."Per OTISI,J.C.A. (Pp. 22-23, Paras. C-B) - read in context

7. BANKING LAW - INTEREST ON CREDIT FACILITIES: General rule asto payment of interest on a debt or loan and its exception"Furthermore, in the absence of a specific agreement that interestcharges be suspended, a bank is entitled to continue to charge interestuntil the credit facilities granted a customer of a bank have beencompletely cleared; STB Ltd v Inter Drill Nigeria Ltd (2007) All FWLR(PT 366) 756 at 761; UBN Ltd. v. Salami (1998) 3 NWLR (PT 543),(1998) LPELR-6189 (CA)."Per OTISI, J.C.A. (Pp. 37-38, Paras. F-A) - readin context

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8. BANKING LAW - BANKER-CUSTOMER RELATIONSHIP: What theCourt should consider where there is a dispute between a bank and itscustomer in relation to recovery of loan"As rightly submitted by learned Counsel for the Appellant, wherethere is a dispute between a bank and its customer in relation torecovery of loan advanced by the banker to customer the questionsthe Court should normally consider are:1. Was the defendant granted a loan by the plaintiff;2. If so, how much was the loan;3. What was the interest agreed; and,4. How much, if any, has the defendant paid out of the loan.See: FBN Plc v. Obeya (1998) 2 NWLR (PT. 537) 205 at 207; A.C.B. Plcv. Nwanna Trading Stores (Nig) Ltd (2007) 1 NWLR (Pt 1016) 596."PerOTISI, J.C.A. (P. 40, Paras. C-E) - read in context

9. COMPANY LAW - AUDIT REPORT: Effect of an audit report givenwithout proper input from the other party"An audit report that is made without opportunity given for properinput from the other party affected by it cannot be countenanced assuch. See also Adigun v. A.G. of Oyo State (1987) 3 S.C. 250. Liabilitycannot be laid at the feet of a party based on the result of an exercisecommissioned by the other party that did not admit or take account ofhis input. No weight can therefore be attached on the said auditreport."Per OTISI, J.C.A. (P. 31, Paras. C-E) - read in context

10. CONTRACT - BINDING CONTRACT: Whether parties are bound bythe terms of their contract"It is elementary that parties are bound by the terms of the agreementthey enter into; UBN v. Ozigi (supra); African International Bank Ltd v.Integrated Dimensional System Ltd (supra). Learned Counsel for theRespondent rightly submitted that unless there is established evidencethat a party was led into an agreement fraudulently, parties are boundby the written and express terms of their contract; Chidoka v. FirstFinance Co. Ltd (2012) LPELR-9343 (SC); (2013) 5 NWLR (PT 1346)144."Per OTISI, J.C.A. (P. 41, Paras. C-E) - read in context

11. EVIDENCE - BURDEN OF PROOF/ONUS OF PROOF: On whom liesthe burden of proof in civil cases"The time honoured principle of law remains that he who asserts mustprove; Ohochakwu v. Attorney General, Rivers State (2012)LPELR-7849(SC); CPC v INEC (2011) LPELR-8257(SC); Hillary Farms Ltdv M.V. Mahtra (2007) 6 S.C. (PT.11) 85."Per OTISI, J.C.A. (P. 17, Paras.B-C) - read in context

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12. EVIDENCE - PROOF: How a bank can prove a debt"In Oluremi v. NEB Ltd (2003) 5 NWLR (PT 812) 24-25, cited withapproval in Oceanic Bank IntPlc v Broken Agro Allied Ind. Ltd (2008)LPELR-4671 (CA), this Court prescribed the manner in which a financialinstitution should establish a claim thus:"The usual way of proving a debt by a bank is by putting in thestatement of account or secondary evidence thereof where it isadmissible."In Wema Bank Plc v. Osilaru (2007) LPELR-8960 (CA) this Court, perOkoro, JCA (as he then was), further held:"It is trite that a bank statement of account is not sufficientexplanation of debit and lodgments in a customer's account to chargethe customer with liability for the overall debit balance shown in thestatement of account.Any bank which is claiming a sum of money on the basis of the overalldebit balance of a statement of account must adduce bothdocumentary and oral evidence to show how the overall debit balancewas arrived at. See Yusuf v. A.C.B (1986) 1-2 SC 49...In the instantcase, it was not sufficient for the DW1 to dump the statement ofaccounts on the Court without explaining clearly the entries thereinparticularly since the debt is constituted by interest charged after thefinal demand notice..."Section 51 of the Evidence Act, 2011 provides that:"Entries in books of accounts or electronic records regularly kept in thecourse of business are admissible whenever they refer to a matter intowhich the Court has to inquire, but such statements shall not alone besufficient evidence to charge a person with liability."This simply means that if the purpose of tendering the entries orelectronic records was to charge a person with liability, there shouldbe some form of corroboration of the entries. Learned author, S. T.Hon. S.A.N. in Law of Evidence in Nigeria, Vol. 1, put it this way atpages 121 - 122:"But corroborative evidence here has no special form. Thus:(a)Where a plaintiff produces books of accounts and one of hiswitnesses testifies in support of the entries but there is no cross-examination, this unchallenged evidence amounts to sufficientcorroboration.(b)Any relevant fact which could be treated as evidence would besufficient corroboration, if true.(c) Materials for corroboration may take the shape of vouchers,receipts or other documentary evidence or sworn oral testimony.(d) Corroboration may also be by admission of the entries by theopposite party."Per OTISI, J.C.A. (Pp. 41-44, Paras. F-A) - read in context

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13. EVIDENCE - ADMISSION/ADMITTED FACT(S): Implication when adefendant admits the indebtedness or receipt of the loan"It is settled that once the defendant admits the indebtedness orreceipt of the loan, the burden as to repayment or as to the reasonsfor non-payment rests on the defendant; Okoli v. Morecab Finance(Nig) Ltd (2007) 14 NWLR (PT 1053) 37."Per OTISI, J.C.A. (P. 46, Paras.D-E) - read in context

14. INTERPRETATION OF DOCUMENT - CONSTRUCTION OFDOCUMENT(S): Cardinal rule of interpretation or construction ofdocument"It is quite trite that words used in a document are given only theirordinary natural grammatical meaning; First Bank Plc v. Maiwada(2012) LPELR-9713(SC); Ihunwo v. Ihunwo (2013) LPELR-20084(SC)."Per OTISI, J.C.A. (P. 35, Paras. D-E) - read in context

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ONYEKACHI AJA OTISI, J.C.A. (Delivering the Leading

Judgment): This is an appeal against the judgment of

Andrew E. Okon J. of the High Court of Justice, Akwa Ibom

State sitting in Uyo dated October 29, 2013 wherein the

claims of the Appellant were dismissed and the Counter

Claim of the Respondent was granted.

The Appellant, a customer of the Respondent (then known

as Intercontinental Bank Plc), had instituted Suit No

HU/239/2010 against the Respondent. By his Amended

Statement of Claim, at pages 288 - 311 of the Records of

Appeal, the Appellant sought the following orders of the

trial Court:

a. A declaration that the Claimant is the customer of theD e f e n d a n t b y o p e r a t i n g a c c o u n t n u m b e r s0201001000001329 (now account number 0042927387),02010000004389 (now account number 0042930237) and0201001000177494 (now account no. 0042948522)obtaining credit facilities from Defendant for execution ofcontracts and that the Defendants owed the claimant manyduties arising from the banking relationship.b. A declaration that the Defendant was the Agent of theclaimant by undertaking in a written agreement to collectcontract proceeds from the

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Anambra State Ministry Education vide the Memorandum

of Understanding (MOU) and the contract proceeds

domiciliation agreement/agreement and was bound by the

agreements.

c. A declaration that the Defendant had fully recovered the

total credit facility granted to the Claimant and necessary

charges through amount recovered from the domiciliation

agreement and other cash lodgments and fund transfer into

the claimant's account No. 020100100001329 (now account

number 0042927387) between 01/10/2008 and 09/06/2010.

d. A declaration that the Defendant cannot continue to

charge claimant unjustified interest with effect from 1st

June, 2009 after having recovered the principal sum of

N60,356,900.00 which the Claimant withdrawn out of the

N62,000,000.00 credit facility granted to the Claimant

and having failed in her duties and breached a fundamental

term of the facility agreement.

e. A declaration that the correct balance on the claimant

account number 0201001000001329 (now account number

0042922387), should be N2,806,559.13 credit made up as

follows:

a. Closing balance as at 30/5/2009 credit - - 2,699,524.13

b. Cash Deposit by claimant debtor

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as at 26/8/09 -- 113,475.00 credit

c. Cash Deposit by claimant debtor as at 8/6/10 - 960.00

credit

d. Cash Deposit by claimant debtor as at 9/6/10 - 2,600.00

credit

Total - N2,806,559.13

f. A declaration that the correct balance in the Claimant's

company account No. 02010000004389 (now account

number 0042930237) was N525,610.90 credit as at

26/6/2008 and after funds transfer/lodgment of

N1,180,000.00 was N1,705,612.90 as at 17/4/2009.

g. A declaration that the Claimant is not owing the

Defendant any sum of money having fray repaid the

financial assistance of N60,356,900.00 and the claimants

company account number 0201001000001329 (now

account number 0042927387) reflected a credit balance of

N2,688,524.13 though stated as N38,106.25 as at

30/5/2009.

h. A declaration that the Defendant having failed in her

obligation to collect balance of the contract sum of N71.4

million breached the terms of the MOU/domiciliation

agreement and having recovered more than the amount

actually released to the claimant is not entitled to collect

any other contract domiciliation payment meant for the

claimant under any of the existing domiciliation

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agreement between claimant and the defendant.

i. A declaration that the defendant's refusal to release the

approved N35million before 12/7/2010 after the fulfillment

of all the conditions required from the claimant, gave rise

to the frustration and termination of the contract awarded

to the claimant by the Ebonyi State Ministry of Education

for the 2008/2009 and 2009/2010 academic session after

the claimant had invested N21,195,311.00 in the said

contract.

j. A declaration that the defendant by refusing to finance

the contract worth N69,120,000.00 from the Ebonyi State

Ministry of Education to the claimant for the 2008/2009

school session frustrated the claimant from earning a profit

income of N63,240,000.00 for the two academic sessions of

2008/2009 and 2009/2010.

k. A declaration that the Defendant misled the claimant

w i th p romi ses i n to spend ing a t o t a l sum o f

N21,195,311.00 in the contract subsequently terminated

as a result of the frustration/disappointment caused by the

Defendant.

l. An order directing the defendant to rectify claimants

company account number 0201001000001329 (now

account number 0042927387) to reflect credit balance of

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N2,806,559.13 as at 10/6/2010 and account number

02010000004389 (now account number 0042930237) to

reflect the correct credit balance of N1,705,612.90 as at

N17/4/2009.

m. An order directing the Defendant to pay interest on the

sum of N2,806,559.13 being the correct credit balance on

c la imants company current account number

0201001000001329 (now account number 0042927387) as

at 10/6/2010 with effect from 01/7/2010 till date of

judgment at 20% at the monthly balance rest formula of the

bank.

n. An order directing the defendant to pay interest on the

sum of N1,705,612.90 being the correct credit balance on

claimant's current account number 02010000004389 (now

account umber 0042930237) as at 17/4/2009 with effect

from 01/05/2009 till date of judgment at 20% at the

monthly balance rest interest formula of the Bank.

o. An order directing the Defendant to refund the sum of

N21,195,311.00 which Defendant encouraged the claimant

to expend in the contract of Ebonyi State Ministry of

Education which was terminated as a result of the

frustration caused by the Defendant.

p. An order directing the Defendant to release all the

collateral/properties of

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the claimant given as security for the fully rep aid financial

assistance of N60, 3561900.00.

q. An order directing the defendant to refund the sum of

N8,755,245.26 being excess and irregular charges

observed through Audit Verification exercise.

r. An order directing the Defendant to pay the claimant the

sum of N63,240,000.00 as special damages being the

profit the claimant would have earned from the contract of

Ebonyi State Ministry of Education frustration by the

Defendant for the two academic sessions of 2008/2009 and

2009/2010.

s. General damages of N60million in favour of the claimant

against the Defendant for breach of contract agreement.

t. Interest on the judgment sum of 10% monthly from date

of judgment till date of final judgment.

The Respondent filed a Statement of Defence with

Consequential Amendment and counterclaim, at pages 239

- 363 of the Records of Appeal, in which it counterclaimed

as follows:

1. The Defendant counterclaim against the claimant for the

sum of N77, 608,175.71 being the outstanding

indebtedness owed her by the claimant as at 1st June,

2011, arising "from the facilities advanced him as per the

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pleading in the statement of claim. The Defendant shall at

the trial of this case rely on various document pleaded in

her statement of defence herein. The Defendant shall at the

tr ia l of th is case rely on the statement of A/C

0201001000001329 and 02010000004389, operated by the

Claimant to show various transactions thereto.

2. The Defendant shall specifically rely on paragraphs 1 -

43 of the statement of defence in establishing her

counterclaim.

The Defendant also claim interest on the principal sum at

the current Bank rate and as agreed between parties

herein from June 2011 until judgment.

4. The Defendant therefore claims from the Claimant the

sum of N77, 628,175.71 as well as the agreed interest on

the facility.

At conclusion of hearing, the learned trial Judge dismissed

the Appellant's claims and granted the counterclaims of the

Defendant, and awarded costs of N20, 000.00 in favour of

the Respondent. Dissatisfied with the judgment of the trial

Court, the Appellant filed a Notice of Appeal on 4/11/2013,

with sixteen grounds of appeal.

The parties exchanged Briefs of Argument, which were

adopted by S.C. Peters, Esq. of Counsel for

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the Appellant; and by Edidiong Akpanuwa, Esq., of Counsel

for the Respondent on 24/3/2015. Out of the sixteen

grounds of appeal, learned Counsel for the Appellant,

distilled a sole issue for determination as follows:

Whether from the totality of the evidence adduced before

the learned trial Judge by the parties His Lordship, the

learned trial Judge was correct to have dismissed the

Appellant's claims and allowed the Respondent's Counter

claim.

The Respondent adopted this sole issue for determination

as formulated by the Appellant.

The facts leading to this appeal, as relayed by the parties

differ in material respects. It is not in issue that the

Appellant was a customer of the Respondent, who had

obtained credit facilities from the Respondent to execute

contracts for the supply of educational books to Ministries

of Education in some States of the Federal Republic of

Nigeria. For these purposes, the Appellant operated three

accounts with these numbers 0201001000001329;

02010000004389; and, 02010010001 77494. The

Respondent advanced credit facilities on two of these

accounts, totalling the sum of N62 million, broken down as

follows: on

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00201001000004389, the sum of N27 million; and, on

02010010000001329, the sum of N 35 million. He was

allowed to withdraw N25, 966,900.00 from account number

00201001000004389 while the sum of N1,033,100.00 was

withheld as upfront interest/charges. On account number

02010010000 01329, he was allowed to withdraw the sum

of N34, 390,000.00, while the sum of N610,000.00 was

withheld as upfront interest/charges. The total sum of N60,

356,900.00 was released to him on these accounts.

The contract awarded to the Appellant by the Anambra

State Ministry of Education was for N191.4 million. The

Appellant's position was that it was the responsibility of the

Respondent by virtue of a Memorandum of Understanding

and letters exchanged between the said Ministry and the

parties, to recover payment for the contract from the

Anambra State Government, which payment was to be

domiciled with the Respondent.

The Appellant was paid N25 million by the said Ministry

initially, without the money passing through the account.

The sum of N95 million was subsequently recovered by

Respondent in four installments, leaving a balance of N71

.4 million.

Upon agreement of the

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parties, on 261612008, the debit balances of both accounts

were collapsed into one account, 02010010000001329,

which now had a total debit of N81, 044,925.41. Upon this

restructuring, the sum of N36 million was transferred from

account no 00201001000004389 into 02010010000001329.

Since only the sum of N60, 356,900.00 had been released

to him, accumulated charges of N20, 688,025.41 by the

Respondent within fifteen months had pushed the total

indebtedness to N81,044,925.41 as at 26/6/2008. After the

sum of N36 million was transferred from account no

00201001000004389, the said account had a credit balance

of N525, 612.90. The Appellant's debtors made subsequent

payments of N1, 180,000.00 into the account, bringing the

total credit on that account to N1, 705,612.90. But the

Respondent later posted twenty six charges into the same

account amounting to N1, 001,176.16.00.

On 29/1/2009, the Respondent further restructured the

f a c i l i t y b a l a n c e o f N 7 6 , 7 0 6 , 5 0 2 . 3 3 o n

02010010000001329, by extending the repayment period

by 180 days. The Appellant averred he was debited on the

accounts for the facility of N62, 000,000.00, from March

2007 to May 2009, as interest and

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other charges, a total sum of N45,249,500.22.

It is the case of the Appellant that he had cleared his

indebtedness and refunded a total sum of N63, 220,000.00

in full repayment of the loan.

As already stated, on 26/6/2008, on account no

00201001000004389, he had a credit balance of N525,

612.90. As at 30/5/2009, on account number 0201001 0000

001329 he had a credit balance of N2, 688,524.13.

The Appellant alleged there were manipulations on the

accounts. After he had completely cleared his indebtedness

on 02010010000001329 on 30/5/2009, the Respondent

resumed further charges on the account. He noticed

arbitrary charges. Two debit transactions totalling N41,

910,246.57 were posted on his account on 12/8/2009. The

transactions were not to his knowledge or for his benefit.

Irregular charges of N8,755,745.26 were observed and the

Appellant protested in writing. It was averred that in

response, the Respondent by letter dated 7/10/2009

admitted the excess and irregular charges, and offered to

refund N1, 700,000.00. No refund was made. But, the

Respondent did not stop further interests and charges on

the account as requested by the Appellant.

The

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contention for the Appellant was that the Respondent was

no longer entitled to collect or debit the Appellant's

account with further interest or charges, having recovered

the sum of N63, 220,000.00 as against the N60, 356,900.00

released to the Appellant for contracts. From the sum of

N95 million, the sum of N31, 780,000.00 was released to

the Appellant. The Appellant averred that this sum was not

a new facility but in acknowledgement of the fact that only

the sum of N60, 356,900.00 had been released to him and

that he had cleared his indebtedness.

The Appellant won another contract worth N69, 120,000.00

from Ebonyi State Ministry of Education. He wrote to seek

credit facility from the Respondent of N35 million. He was

given conditions for approval of the said facility, which he

satisfied. He also commenced execution of the new contract

on his own, investing personal resources amounting to

N21, 195,311.00. The Respondent however notified him

subsequently that the new facility sought had been

cancelled as a result of his previous indebtedness. The

Appellant had earlier given as collateral for the initial

credit facilities, two landed properties with a

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total forced sale value of N85 million. When he could not

get the Respondent to rescind its decision on the new

facility sought, the Appellant applied to have one of the

landed properties released to him to enable him seek credit

facility elsewhere. The Respondent did not respond to his

request. Finally, he could not execute the contract and it

was terminated by the Ebonyi State Ministry of Education.

As a result, the Appellant averred that he lost the sum of

N21,195,311.00, being his personal funding of the contract;

and the sum of N63,240,000.00, being the expected profit

on the contract from Ebonyi State Ministry of Education.

On their part, the Respondent admitted that credit facilities

totaling the sum of N62, 000,000.00 were granted to the

Appellant but added that on May 16, 2008, the Appellant

enjoyed an enhancement from the sum of N80 Million to

N90 million as Contract Finance (Time Loan) for 90 days to

enable him produce and deliver 80, 000 copies of Abbnny

Educational Uniform Continuous Assessment Test and

Evaluation Workbook for Anambra State Ministry of

Education for 2007/2008 session. That the Appellant on

June 20, 2008 enjoyed N82 million

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Bankers Acceptance for 90 days to enable him collect

receivables of N191 million from Anambra State and pay up

his indebtedness. The Respondent also stated that the

Appellant enjoyed yet another facility of N76, 706,502.22

on January 29, 2009 as Time Loan for 180 days. The

Appellant accepted the facility on February 3, 2009. But,

the Appellant paid in N10 million on February 13, 2009

before the restructuring was booked into his account. The

restructuring was then booked at N71 million to take care

of the bank charges as per the offer letter. The Respondent

averred that the Appellant was allowed to draw down on

these facilities less the charges he ought to have made

before withdrawals. The deductions were in line with the

respective offer letters of the Respondent which were

accepted by the Appellant. The Appellant had earlier

authorized the debit entries by letter dated May 20, 2008.

The Respondent denied it had any responsibility to pursue

and recover payment from the Anambra State Government

under any agreement or MOU. It also denied that there was

an agreement to stop charging interest on the accounts.

Their position was that unless the Anambra State

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Government paid another N25 million on or before

February 25, 2009, the Respondent would not stop

charging interest on the facility.

Their letter of 6/3/2009 was specific that the issue of

interest would be addressed after payment of N25 Million.

The Respondent further denied that either of the accounts

of the Appellant was in credit when the accounts were

restructured to be operated together. That the movement

of N36 million from 02010000004389 to 020100100001329

still left 02010000004389 in debit as the interest and other

charges were not moved. The balance of N525, 000.00 and

the subsequent payment of N1, 180,000.00 into the account

only reduced the Appellant's debit balance on the account.

The Respondent averred that the interest and all other

charges on the accounts were as stipulated for the facilities

which the Appellant accepted, and that there was no

manipulation of the interest or other charges. The

Respondent also denied it wrote any letter accepting to

refund any sum to the Appellant, alleging that the letter

was forged.

The Respondent denied that it had approved or accepted to

grant any further facility to the Appellant to execute

15

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a contract with Ebonyi State.

It denied it had requested for any requirement from the

Appellant in respect of its contract with Ebonyi State. It

stated that the Appellant, who had not liquidated his

indebtedness to the Respondent, was not entitled to any or

all of its collateral. The Respondent finally denied the

claims of the Appellant and asked the trial Court to grant

its counterclaim.

In his Amended Reply to the Statement of Defence, at page

324 - of the Record of Appeal, the Appellant averred that

enhancement of contract finance as at May 2009 for

another 90 days was not a new facility but was done in

preparation for the consolidation exercise of 26/6/2008 on

the two accounts, which brought his indebtedness to

N81,044,925.41.

He also averred that the facility restructuring on N76,

706,602.22 by document dated 29/1/2009 was not a new

facility but an extension of the repayment period of the

outstanding balance as at 12/1/2009 on the facility in

020100100001329. He pleaded that enhancement of

facility, branding of outstanding debt as Bankers

acceptance and Restructuring of outstanding debt are the

various ways the Respondent extended

16

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repayment periods to the Appellant while awaiting contract

payment proceeds from Ministry of Education, Anambra

State. He further averred that all restructuring was done

before 30/5/2009.

The parties had witnesses who testified in line with their

respective pleadings and tendered relevant documentary

evidence. The time honoured principle of law remains that

he who asserts must prove; Ohochukwu v. Attorney

General, Rivers State (2012) LPELR-7849(SC); CPC v

INEC (2011) LPELR-8257(SC); Hillary Farms Ltd v M.V.

Mahtra (2007) 6 S.C. (PT.11) 85. The Appellant as

claimant had the burden to prove his case. He testified in

person as PW1 and tendered a number of documents. Staff

of the Respondent, Moses Udosen, Relationship Manager,

testified for the Respondent as DW1 in their defence and in

proof of the counterclaim.

As already acknowledged the evidence revealed that the

parties had a long standing relationship of banker and

customer. The Appellant had enjoyed the financial

assistance of the Respondent in running his business, until

their relationship turned sour. The Appellant alleged that

he had been overcharged for the facilities granted to him

by the

17

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Respondent, and that there were manipulated charges. The

genesis of the facilities granted to him was for N27 million

and N35 million. PW1 tendered Exhibit J, being the offer

letter for overdraft facility of N27million; and Exhibit K,

which was the offer letter for the contract finance facility of

N35 million. Exhibit AH was another offer letter titled:

"RE: ENHANCEMENT OF CONTRACT FINANCE FACILITY

FROM N80 MILLION TO N90 MILLION"

These letters indicated all the terms of each respective

offer which included the pertinent interest rates and other

charges. Each of the offers also contained an acceptance

portion, which the Appellant signed stating that:

All the terms and conditions of this offer letter are accepted

by me, OBONG (DR) ANNY ASIKPO (TRADING AS ABBNNY

EDUCATIONAL PUBLISHERS).

These offer letters also included the following clause:

"The borrower hereby agrees and accepts that

Intercontinental shall be entitled to capitalize interest on

the facility at the rate both during and after expiry of the

tenure hereby granted until the facility is fully paid or

recovered."

Exhibits AK and AK1 were tendered under cross

examination

18

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through PW1, who did not dispute their authenticity. These

documents were issued by the Appellant to the Respondent,

further accepting the terms and conditions for drawdown

on the Enhancement of Contract Finance Facility and

authorizing the Respondent:

"to deduct 'upfront, fees and charges in respect of the loan

facility'

The Appellant also issued an 'authority to debit' his account

for the cost of perfecting the legal mortgage on the pledged

property. Under cross examination, at page 507 of the

Record of Appeal, PW1 admitted thus:

"When the facilities were granted to me the bank took

interest on charges upfront. My complaint is that the bank

should have taken N1m as upfront charges and not over

N1.6 m which the bank took."

See also his testimony under cross examination at pages

504 and 524 of the Record of Appeal.

��Exhibit AL, also tendered by PW1 under cross

examination, was the letter he wrote to the Respondent on

16/6/2008 seeking a renewal of the facility of N82million

for another period of 90 days, while awaiting payments

from Anambra State Government. It was approved by letter

dated 20/6/2008, with its stated terms and conditions

19

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duly accepted by the Appellant. PW1, again under cross

examination tendered Exhibit AM dated 29/1/2009 by

which another application for restructuring of the facility of

N76, 706,502.22 was approved with its stated terms and

conditions duly accepted by the Appellant. Exhibit AN

dated 3/2/2009 was under caption: "RENWAL OF

OUTSTANDING FACILITY OF N76, 706,502,22 MILLION

FOR 180 DAYS TENOR."

It is well settled that by practice, usage and custom of

banking, banks charge interest on loans, overdrafts and

other financial facilities granted to their customers. As long

as a credit facility of whatever nature is granted to a

customer by a bank remains outstanding, the bank is

entitled to charge interest thereon. This is simply because

it is part of the business of banking to grant credit

facilities, and since it is not a charity organization, it must

charge reasonably for that service.

While it is expected that such interest charged must be

agreed upon by the parties, it has been held that interest

may be charged even where no express interest is made a

term of the facility. The Supreme Court, per Obaseki, JSC

in Barclays Bank (Ni) Ltd v. Abuhakar (1977)

20

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LPELR-750 (SC), (1977) 10 S.C. 7 put it this way:

Where there is no express agreement, it is settled law that

the Bank is entitled to charge compound interest on the

basis that there is a custom to that effect or that the

customer has impliedly consented where without protest he

allows his account to be debited.

See also Diamond Bank Ltd v, Partnership Investment Co

Ltd (2009) LPELR-939(SC), (2009) 18 NWLR (PT

1172) 67; UBA Plc. v. Lawal (2007) LPELR-9042 (CA).

A bank's power to charge interest on loans, overdraft and

other advances has become a matter of law, vested in the

Central Bank of Nigeria and not just a matter of mutual

consultation between the bank and its customer; Section

15 Banking Act, Cap 29, Laws of the Federation of

Nigeria, 1990. See further: Union Bank v. Ozigi (1994) 3

NWLR (Pt.333) 385; Union Bank Plc v. Ajabule (2011)

LPELR-8239 (SC).

See also the documents tendered by PW1 which indicated

that the transaction was subject to the rules and

regulations of the Central Bank of Nigeria. I note that the

Appellant pleaded that the Respondent's charges were far

above the Central Bank of Nigeria lending rate of 20% per

annum prevailing

21

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at the time the overdraft facility was granted; paragraph 31

of the Amended Statement of Claim at page 302 and the

testimony of PW1 at page 508 of the Record of Appeal. But,

aside from the bare faced assertion, no proof was tendered

by the Appellant to show that the charges on the facilities

received were not in tune with the Central Bank of Nigeria

fixed charges. This allegation was therefore not proved.

It may not be unheard of to find a bank which loads un-

reasonable charges on its customer. If such charges were

not voluntarily agreed upon prior to the grant of the

facility, they may not be enforceable. But where a party

voluntarily agrees to such unreasonable charges prior to

the grant of the facility, the party may not be permitted to

retract from it.

Parties are bound by the contents of any lawful written

agreement duly executed by them; Anyaegbunam v. Osaka

(2000) 3 S.C. 1; African International Bank Ltd v.

In tegra ted D imens iona l Sys tem Ltd (2012)

LPELR-971(SC) .

It is trite that an agreement written and executed by the

parties cannot be varied by oral evidence; Koiki v.

Magnusson (1999) LPELR-1697 (SC), (1999) 5 S.C.

(Pt.111) 30; Egharevba v. Osagie

22

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(2009) 18 NWLR (PT 1173) 299 S.C. The parties are

bound by the terms of that agreement. An agreement which

seeks to vary the original written agreement must also be

in writing; Baliol Nigeria Ltd v. Navcon Nigeria Ltd (2010)

LPELR-717(SC), (2010) 16 NWLR (Pt. 1220) 619 SC;

Bilante International Ltd v. NDIC (2011) LPELR-781(SC).

Therefore an agreement to vary the terms of an earlier

agreement for a credit facility must also be in writing to be

enforceable.

In the instant case, as already observed, all the various

applications for renewals, restructuring, enhancement,

came with their own distinct terms and conditions, which

the Appellant duly accepted in writing.

Indeed under cross examination at page 524 of the Record

of Appeal, PW1 admitted:

"Every facility I enjoyed from the defendant attracted

charges"

At page 529, he further admitted:

"When I applied for facilities and same were granted to me,

I did not question the interest rate"

The Appellant had alleged the manipulations of charges on

his account.

He also questioned the withholding of the sums of

N1,033,100.00 and N610, 000.00 by the Respondent. The

Respondent's

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explanation was that the said sums of N1,033,100.00 and

N610,000.00 were retained from these accounts as up-front

interest/charges, upon agreement reached with the

Appellant by the offer accepted by him, prior to the release

of the funds. There was no credible challenge to this

assertion.

It was also alleged by the Appellant that the Respondent

continued to deduct manipulated arbitrary charges and

interest on the accounts. The Respondent denied this

allegation, maintaining that all the facilities granted the

Appellant, whether restructured or enhanced or by

whatever description and for whatever period came with its

own distinct charges.

That it never charged interest outside the agreed terms.

The documents tendered by PW1 in evidence in chief and

under cross examination all show that there were different

categories of charges for each facility or extension of same

howsoever granted. Although the Appellant did not

demonstrate by any credible evidence that the interest and

charges deducted by the Respondent, upfront or

subsequent to draw down were arbitrary or manipulated, it

would appear that this allegation was not seriously made.

The learned trial

24

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Judge rightly described the allegation as criminal, see page

550 of the Record of Appeal.

An allegation that figures are manipulated borders on

fraud, something dishonest and morally wrong. Particulars

of the fraud must be pleaded and the allegation proved

beyond reasonable doubt; Section 135(1) of the

Evidence Act, 2011. See also Olufunmise v. Falana

(1990) 3 NWLR (PT 136) 1, (1990) 4 S.C. 174;

Babatunde v. Bank of the North Ltd (2011) LPELR-8249

(SC). The Appellant neither provided particulars of the

alleged manipulation nor proved any by credible evidence.

The Appellant had alleged that the Respondent had the

duty of pursuing payment from Anambra State Government

upon the contract and that the Respondent had consented

to stop interest charges until the facility was paid off, in

view of the long period of time the Anambra State

Government was taking to settle the contract sum. Exhibit

H, tendered by PW1, was the Minutes of a meeting held by

the parties and officials of the Anambra State on

September 10, 2008 regarding the mode of payment on the

contract between the Appellant and Anambra State. The

minutes stated thus:

"The issue of whether or not

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Abbny publishers should continue to pay interest rate to

Intercontinental Bank Plc Uyo was not immediately

resolved."

Exhibit L was the minutes of another meeting held on

February 6, 2009.

The minutes stated thus:

"Mr Bassey Ebong assured the meeting that if another N25

million is released on or before 22/23rd February, 2009

that the Bank will seek approval to stop Capitalized interest

on the outstanding balance owed to her by Abbnny

Publishers."

Mr Bassey Ebong was described therein as the Area

Business Executive of the Respondent, and represented it

at the meeting. These Exhibits tendered by the Appellant

belie his contention that there was an agreement by the

Respondent to stop charging of interest. Rather, as the

Respondent rightly had averred, the Respondent's

representative gave a commitment to seek approval to stop

capitalized interest on the outstanding balance owed by the

Appellant, if another N25 million is released on or before

22/23rd February, 2009. This was not done, hence the

Respondent in its letter to the Hon Commissioner of

Education, Anambra State, tendered as Exhibit M by PW1

stated:

"...it was discussed and

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agreed that the next payment of N25, 000,000.00 (Twenty

Five Million Naira Only) will be made on or before the 25th

of February, 2009 such that interest charges in the account

will be addressed.

We wish to bring to your notice that you have reneged on

this agreement and hence the state of the account still

remains the same".

See also the Appellant's letter, dated December 23, 2008,

Exhibit P, to the Respondent in which he acknowledged

that the outstanding balance on the facilities was N76,

706,502.22 and requested that further interest and other

charges be stopped in view of the failure by the Anambra

State Ministry of Education to pay off the entire contract

sum.

Exhibits C and C1 were letters written by the Ministry of

Education, Anambra State to the Respondent committing

itself to paying in all monies generated in respect of the

contract with the Appellant into his account with the

Respondent. The letters mean no more than they state.

The letters represent that written commitment by the

Ministry of Education, and were not a commitment by the

Respondent to pursue funds due to the Appellant on the

contract with the Ministry of Education,

27

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Anambra State.

It was not in issue that the debit balances in the accounts

operated by the Appellant were restructured into one by

the movement of N36 million from 02010000004389 into

020100100001329. However, contrary to the stance of the

Appellant, one account was not closed. Under cross

examination, at page 506 of the Record of Appeal, PW1

said:

"I operated two accounts with the defendant before

26/6/2008. On 26/6/2008, the defendant consolidated the

two accounts to become only one account which I am still

operating with the defendant. It is not true that even at

consolidation, the two accounts were operated separately

side by side."

This testimony loses sight of the fact that PW1 also deposed

in paragraph 17 of his written deposition at page 316-317

of the Record of Appeal that after the movement of N36

million from 02010000004389 into 020100100001329,

there was a credit balance of N525, 000.00 in

02010000004389 and a further subsequent payment of N1,

180,000.00 into the same account by his debtors. If the

account 02010000004389 had been closed or was no

longer in operation, no credit can have been received

therein.

The Appellant

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pleaded that all renewal of facilities were concluded before

May 30, 2009. Under cross examination, at page 507 of the

Record of Appeal, PW1 admitted thus:

"As at the point of consolidation, I was in the debit of over

N81m. At the point of consolidation, I was in debit in the

two accounts."

He was at pains to prove that he had cleared off his entire

indebtedness.

Exhibit AT was the statement of account of 02010010000

1329. The said Exhibit showed that the Appellant had paid

a total of N141, 070,000.00 leaving a credit balance of N16,

018,018.00 on 1 /6 /2009. Thereby the sum of

N81,044,925.41 was more than paid off .

The position of the Respondent was that the restructuring

of the debit balances did not affect the already accrued

charges and interest on that the account and that the sums

of money paid into the account only reduced the Appellant's

debit balance thereon. The same Exhibit showed the

various charges on the facilities for which the account was

debited. I shall return to this point later.

The Appellant as PW1 said he commissioned auditors to

audit his account with the Respondent and that he sent the

audit report to the

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Respondent. PW1 tendered a letter dated August 28, 2009,

Exhibit N, being a letter addressed to the Respondent and

captioned:

"REQUEST FOR RECONCILIATION AND REFUND OF

EXCESS CHARGES ON ACCOUNT NO. 020100100001329,

02010000004389 AND 0201001000177494.

The letter stated, in part, as follows:

"Due to the inconsistencies and several questionable

entries discovered in the above accounts, I contacted my

External Auditors...

Audit and Investigate my Account with your branch...

The Auditors have completed the investigations and a copy

of their report is herewith attached for your perusal,

please.

In view of the above, I am requesting for the reconciliation

of the accounts and subsequent refund of the excess

charges of Eight Million, Seven Hundred and Fifty-five

Thousand, Seven Hundred and Forty-five Naira, Twenty-six

Kobo only (N8,755,745.26) to me..."

See also his testimony under cross examination, at page

508 of the Record of Appeal. PW1 admitted under cross

examination that there was nothing to show that the

Respondent had anything to do with the Audit Report,

Exhibit O. The Respondent denied it had knowledge of any

audit on

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the Appellant's accounts and that the auditors neither

called to inspect the books and entries representing the

Respondent's relationship with the Appellant nor were the

auditors given any, such documentation. No audit queries

were raised. The Appellant did not deny that audit queries

were not raised. I note that Exhibit N, as reproduced above,

did not make mention of any input from the Respondent in

this audit exercise. Audit queries are necessary to clarify

unclear entries. The question is: how does an auditor

produce an authentic audit report without a review of the

complete documentation of the relevant relationship?

An audit report that is made without opportunity given for

proper input from the other party affected by it cannot be

countenanced as such. See also Adigun v. A.G. of Oyo State

(1987) 3 S.C. 250. Liability cannot be laid at the feet of a

party based on the result of an exercise commissioned by

the other party that did not admit or take account of his

input. No weight can therefore be attached on the said

audit report.

Exhibit Q dated October 7, 2009, also reproduced by the

learned trial Judge at pages 550-551 of the Record of

Appeal, was

31

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tendered as a reply written by the Respondent in response

to Exhibit O. Exhibit Q explained as follows:

"...the interest charges were interest on the overdraft

facilities and the time loan granted to your company from

February, 2007 to August, 2009 which were based on the

daily outstanding balances and the interest rates as agreed

with you at the time the transactions were initiated. Kindly

refer to the offer letter. Other debit charges of N783,

500.00 (seven hundred and eighty three thousand, five

hundred Naira only) were expenses incurred in perfecting

legal mortgage on the pledged collateral which was agreed

with you at the time the transactions were initiated. You

may also refer to the offer letter(s) for the facility and also

your letter of authority to debit your account for cost of

perfection charges. You will agree with us that this takes

off over N17m from your claims for refund leaving about

N1.7m for discussion. We would appreciate if you give us

your cheque for the total outstanding amount of N43,

749,398.11 ...probably less N1.7m pending the outcome of

our discussion on the balance."

Although the Respondent denied the authority of the

32

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signatory of the letter and thereby the legitimacy of this

letter, the letter as worded, was not an admission of

excessive charges of N1.7 million. The issue of N1.7 million

was still left for future discussion. As the learned trial

Judge rightly noted, the stance of the Appellant to the

effect that he had cleared all indebtedness before May 30,

2009 cannot be the case.

The Appellant applied to the Respondent by letter, Exhibit

AB, dated June 15, 2010, to have one of his two landed

properties released to him to enable him take on fresh

facility from another bank and execute the contract from

Ebonyi State Ministry of Education. The Appellant wrote

thus:

"I wish to use this medium to request for the release of one

out of the two collaterals, I pledged to the bank in January,

2008 when I took a loan of N35 million to supplement the

cost of producing ABBNNY Workbooks, which I supplied to

Anambra State Ministry of Education...

Sir, taking into consideration my frantic effort to recover

our indebtedness of the sum of N71.4 million from the

Government of Anambra State and liquidate the

outstanding bank charges in my account which of course

the bank is

33

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aware that the fault was/is not mine but that of the

Government of Anambra State, I have no doubt that the

bank would be reluctant to grant request my request

hereinabove. "

The Respondent declined this request on the basis that the

credit facilities granted to the Appellant had not been

cleared. In his further letter Exhibit AD, dated June 21,

2010, the Appellant wrote thus:

"The bank should also note that despite the fact that my

account is currently in red due to non payment of my N71.4

million debt owed to me by the Ministry of Education,

Anambra State...

I am very hopeful that soonest the money shall be pay(sic)

to me and I shall in turn pay to the bank what we shall

mutually agree as additional bank charges including

interest on the N62 million loan which I collected for the

Anambra State job having earlier repaid the principal sum

plus over N2 million as bank charges including interest."

��The dates on which these letters were written, June 15,

2010 and June 21, 2010 are crucial. Also crucial is another

letter dated January 6, 2010 at pages 87 - 89 of the Record

of Appeal, written by the Appellant to the Respondent in

which he

34

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CA)

requested for the following concessions from the

Respondent:

"a) That the bank should suspend/stop further

charges/interest on the said account with effect from 1st

January, 2010.

b). That the bank should give me a waver (sic) of 50% on

the outstanding bank charges/interest of N47, 606,270.65K

in full and final settlement of the facility under review."

The learned trial Judge took the view that implication of

Exhibit AD written on June 21, 2010 is that the Appellant

was still somewhat indebted to the Respondent. Learned

Counsel to the Appellant submitted that this finding by the

learned trial Judge was speculative. I am afraid I do not

take that subscribe to the view that the finding was

speculative.

It is quite trite that words used in a document are given

only their ordinary natural grammatical meaning; First

Bank Plc v. Maiwada (2012) LPELR-9713(SC); Ihunwo v.

Ihunwo (2013) LPELR-20084 (SC). From the undiluted

meaning of the words used in the above letters, the

Appellant stated his account is currently in red. That while

he had paid off the principal sum of the credit facility,

together with some of the interest, he was still indebted to

35

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CA)

the Respondent in respect of some additional bank charges.

A customer who wrote these words on June 21, 2010 ought

not to present a case that he had paid off all outstanding

liability as at May 30, 2009. As at January 6, 2010, the

Appellant was appealing that the Respondent cease further

bank charges/interest, which means that he acknowledged

that the bank charges/interest were still running. The

Exhibits reveal that the Appellant definitely recognized the

fact that there was still additional bank charges/interest.

He sought to have these additional bank charges/interest

negotiated with the Respondent, and he expected to

mutually agree with the Respondent on this issue. Learned

Counsel for the Appellant contended the words additional

bank charges convey an idea of charges that were not

originally agreed upon by the parties. However, the word

'additional' simply means 'supplemental or added to

something'. The Appellant had already paid up some of the

bank charges/interest. From his letters he acknowledged

the bank charges/interest was still running. A completely

new bank charge or interest, different from the original

charge or interest, was not being

36

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negotiated. Rather, the prevailing bank charges/interest

was sought to be suspended or at best re-negotiated. The

Respondent took on the collateral to secure the payment of

the credit facilities it availed the Appellant. The

Respondent cannot be compelled to release any property to

the Appellant until the facilities are completely cleared.

Indeed, all I understand the Respondent to be saying is that

there were still outstanding bank charges and interest

which had not been cleared.

The Appellant admitted to signing the documents which

gave rise to these facilities. The Appellant agreed and

accepted that the Respondent shall be entitled to capitalize

interest on the facility at the rate both during and after

expiry of the tenure until the facility is fully paid or

recovered. The outstanding bank charges and interest were

capitalized and continue to attract further charges and

interest so long as they remain outstanding. Furthermore,

in the absence of a specific agreement that interest charges

be suspended, a bank is entitled to continue to charge

interest until the credit facilities granted a customer of a

bank have been completely cleared; STB Ltd v

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Inter Drill Nigeria Ltd (2007) All FWLR (PT 366) 756

at 761; UBN Ltd. v. Salami (1998) 3 NWLR (PT 543),

(1998) LPELR-6189 (CA).

The Respondent denied it had approved a facility to the

Appellant to execute a contract with Ebonyi State. Exhibit

V, tendered by PW1 is a letter from the Hon. Commissioner

of Education, Ebonyi State addressed to the Respondent in

which was stated:

"Through the publisher's letter to us, we are aware that

your bank is to fund the printing/supply of the

aforementioned workbooks to be supplied to us, and the

publisher has informed us that all payment shall be made to

them through their Bank account in Intercontinental

Bank...and we have agreed ...

In view of the aforesaid, you may wish to grant the

publisher's request for a credit facility to speed up the

printing/supply of the workbooks to us."

From the clear wording of this letter, it was the Appellant

who supplied the information to Ministry of Education,

Ebonyi State, regarding its request for credit facility from

the Respondent to finance the contract.

See also Exhibit Z, a letter written by the Appellant to the

Hon. Commissioner, Ministry of Education,

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Ebonyi State, also tendered by PW1. No communication to

indicate an approval by the Respondent of the request for a

facility was tendered by the Appellant. Neither did the

Appellant plead the details of any verbal approval. Indeed

under cross examination, at page 508 of the Record of

Appeal, PWI stated thus:

"The contract agreement signed in 2006 with Ebonyi, State

Government incorporated that the defendant shall receive

the proceeds by funding the project for three years. The

bank did not write to me but it did what was in the contract

by funding the project and receiving the payment. This was

in respect of the 1st tranche. The bank later wrote to me

saying that it would not fund the 2nd and 3rd tranches

because I was owing (sic) the bank. That is why I am in

Court. "

There is nothing therefore to controvert the denial of the

Respondent that it did not give any approval to the

Appellant on this request. Rather, Exhibit AC, tendered by

PW1, which was a letter from the Respondent declining the

Appellant's request for a credit facility to fund the Ebonyi

State contract, corroborates the stand of the Respondent

that it never gave an approval, whether

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oral or in writing.

Learned Counsel for the Appellant challenged the grant of

the counterclaim by the learned trial Judge. It is well

settled that a counterclaim is a separate and independent

ac t ion f rom that in wh ich i t was ra i sed . The

counterclaimant bears the burden of proving his

counterclaim by presenting substantial credible evidence;

Kyari v. Alkali (2001) 5 S.C. (Pt 11) 192.

As rightly submitted by learned Counsel for the Appellant,

where there is a dispute between a bank and its customer

in relation to recovery of loan advanced by the banker to

customer the questions the Court should normally consider

are:

1. Was the defendant granted a loan by the plaintiff;

2. If so, how much was the loan;

3. What was the interest agreed; and,

4. How much, if any, has the defendant paid out of the loan.

See: FBN Plc v. Obeya (1998) 2 NWLR (PT. 537) 205 at

207; A.C.B. Plc v. Nwanna Trading Stores (Nig) Ltd (2007)

1 NWLR (Pt 1016) 596.

The documentary evidence revealed the existence of the

credit facilities granted to the Appellant by the Respondent,

and the terms thereof. PW1 tendered Exhibits J and K, and

under cross

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examination, Exhibits AH, AJ, AK, AK1 AL, AM and AN were

tendered through him. These Exhibits reveal that there

were express agreements on the fundamental terms of each

facility granted to the Appellant by the Respondent. The

amount of each facility and the agreed charges and interest

for each facility were fully disclosed. They also disclosed

that the transactions were subject to the rules and

regulations of the Central Bank of Nigeria.

These Exhibits also reveal that after the accounts of the

Appellant were consolidated, the indebtedness continued to

attract other facilities. It is elementary that parties are

bound by the terms of the agreement they enter into; UBN

v. Ozigi (supra); African International Bank Ltd v.

Integrated Dimensional System Ltd (supra). Learned

Counsel for the Respondent rightly submitted that unless

there is established evidence that a party was led into an

agreement fraudulently, parties are bound by the written

and express terms of their contract; Chidoka v. First

Finance Co. Ltd (2012) LPELR-9343 (SC); (2013) 5

NWLR (PT 1346) 144.

In Oluremi v. NEB Ltd (2003) 5 NWLR (PT 812) 24-25,

cited with approval in Oceanic Bank IntPlc v Broken

Agro Allied Ind. Ltd

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(2008) LPELR-4671 (CA), this Court prescribed the

manner in which a financial institution should establish a

claim thus:

"The usual way of proving a debt by a bank is by putting in

the statement of account or secondary evidence thereof

where it is admissible."

In Wema Bank Plc v. Osilaru (2007) LPELR-8960 (CA)

this Court, per Okoro, JCA (as he then was), further held:

"It is trite that a bank statement of account is not sufficient

explanation of debit and lodgments in a customer's account

to charge the customer with liability for the overall debit

balance shown in the statement of account.

Any bank which is claiming a sum of money on the basis of

the overall debit balance of a statement of account must

adduce both documentary and oral evidence to show how

the overall debit balance was arrived at. See Yusuf v. A.C.B

(1986) 1-2 SC 49...In the instant case, it was not

sufficient for the DW1 to dump the statement of accounts

on the Court without explaining clearly the entries therein

particularly since the debt is constituted by interest

charged after the final demand notice... "

Section 51 of the Evidence Act, 2011

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provides that:

"Entries in books of accounts or electronic records

regularly kept in the course of business are admissible

whenever they refer to a matter into which the Court has to

inquire, but such statements shall not alone be sufficient

evidence to charge a person with liability."

This simply means that if the purpose of tendering the

entries or electronic records was to charge a person with

liability, there should be some form of corroboration of the

entries. Learned author, S. T. Hon. S.A.N. in Law of

Evidence in Nigeria, Vol. 1, put it this way at pages

121 - 122:

"But corroborative evidence here has no special form. Thus:

(a)Where a plaintiff produces books of accounts and one of

his witnesses testifies in support of the entries but there is

no cross-examination, this unchallenged evidence amounts

to sufficient corroboration.

(b)Any relevant fact which could be treated as evidence

would be sufficient corroboration, if true.

(c) Materials for corroboration may take the shape of

vouchers, receipts or other documentary evidence or sworn

oral testimony.

(d) Corroboration may also be by admission of the entries

by the

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opposite party."

Exhibit AT was the statement of account for 02010010000

1329 and Exhibit AU was the statement of account for

02010000004389. The learned trial Judge considered the

pleadings, as well as the evidence adduced and took the

view that the Respondent did not dump these Exhibits on

the trial Court. I agree with the learned trial Judge. On

5/6/2013, DW1 adopted as his evidence, his sworn written

depositions made on 19/7/2012 and his further depositions

made on 31/5/2013. He tendered Exhibits AT and AU.

These exhibits which were already made available to the

Appellant having regard to the Rules of Court were

admitted in evidence without objection from the Appellant's

Counsel.

Other exhibits relevant to the facilities granted to the

Appellant were tendered through PW1 under cross

examination. DW1 was cross examined on the said

depositions and on the contents of the exhibits tendered.

DW1 gave ample explanations on the details of Exhibits AT

and AU both in his written depositions and under cross

examination.

The documents disclosing germane details of the credit

facilities granted to the Appellant were provided in the

other exhibits

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already before the trial Court. PW1 was confronted with the

exhibits disclosing details of the facilities, most of which

were admitted through him.

E x h i b i t E 1 i s t h e s t a t e m e n t o f a c c o u n t f o r

020100100001329 but it stopped at the entry for

30/5/2009, which showed a credit balance of N38, 106.25.

Exhibit AT, which is the statement of account for the same

account continued to disclose entries up to 30/6/2011.

Exhibit AT showed entries for time loans and capitalized

interest after 30/5/2009.

On Exhibit AT are two entries on 12/8/2009 for a Time Loan

of N6, 910,246.57 and of N35, 000,000, totaling N41,

910,246.57. Under cross examination, DW1 said:

"We gave N41M loan to the claimant on 12/8/2009.

If that loan was not given the interest would not have

arisen."

In paragraph 7 of his written deposition at page 252 of the

Record of Appeal, DW1 had explained thus:

"...The implication of Bankers acceptance and Time Loan

respectively is and was that on the request of the Claimant,

his limit was renewed or extended for a specified time

period. The facilities mentioned herein were duly accepted

by the Claimant and same attracted Defendant's

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charges."

Another credit balance disclosed on Exhibit AT as at

1/6/2009 was the sum of N16, 018,018. But, looking at the

same Exhibit AT, there were further charges on the existing

facilities which swallowed up the credit balance and

pushed the account back to debit of N77, 628,175.71.

As already shown above, by virtue of Exhibit AD written on

June 21, 2010 by the Appellant to the Respondent, the

Appellant was well aware of the fact that interests/charges

were still running on the account. The credit balance of

N38, 106.25 disclosed on 30/5/2009 therefore cannot be

relied upon to absolve the Appellant on further liability on

the credit facilities he enjoyed from the Respondent.

It is settled that once the defendant admits the

indebtedness or receipt of the loan, the burden as to

repayment or as to the reasons for non-payment rests on

the defendant; Okoli v. Morecab Finance (Nig) Ltd (2007)

14 NWLR (PT 1053) 37. The Appellant did not discharge

this burden. The Appellant who admitted Exhibits AL and

AM, thereby enjoying the renewal of the facility for N76,

726,502.22, did not prove that he had cleared his

indebtedness on the credit facilities,

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which included the agreed bank charges/interest.

Upon a calm consideration of the evidence that was

adduced before the trial Court, I am of the firm view that

the learned trial Judge rightly found and held that the

Appellant failed to prove his case on the preponderance of

evidence. I also agree with the learned trial Judge that the

Respondent proved its counterclaim.

In all, this appeal is without merit and therefore fails. The

appeal is accordingly dismissed. The judgment of the Hon.

Justice Andrew E. Okon, J., delivered on October 28, 2013

in HU/239/2010 is hereby affirmed.

Costs of N50, 000.00 are awarded in favour of the

Respondent against the Appellant.

CHIOMA EGONDU NWOSU-IHEME, J.C.A.: I had theadvantage of reading in advance the judgment delivered bymy learned brother, O. A. OTISI, J.C.A.I agree with his reasoning and conclusions, white adoptingthe facts of this case as ably set down in the lead judgment.

I agree that this appeal is devoid of merit and isaccordingly dismissed. The judgment of the trial Courtdelivered on 28th October, 2013 in suit No. HU/239/2010 isaffirmed. I also award

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N50,000.00 as costs in favour of the Respondent.

PAUL OBI ELECHI, J.C.A.: I have read in draft theJudgment of my Learned brother Onyekachi Aja Otisi,J.C.A. For the reasons ably stated in the lead Judgment, Ientirely agree with the conclusion arrived therein that theappeal is without merit and therefore fails and accordinglydismissed.

I also adopt all the Orders made in the said Judgmentinclusive of the Order as to cost of N50,000.00 awarded infavour of the Respondents against the Appellants.

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Appearances:

S. C. Peters, Esq. For Appellant(s)

A. A. Asuquo, Esq. For Respondent(s)

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Appearances:

S. C. Peters, Esq. For Appellant(s)

A. A. Asuquo, Esq. For Respondent(s)

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