CORAM

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EMMAUEL AKOMAYE AGIM

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PARTIES

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ABADA NIGERIA LTD

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1. UNITY BANK OF NIGERIA PLC2. KWACHAM CONSTRUCTION CROSS CO. NIGERIA LIMITED3. ABDULRAHMAN BUBA KWACHAM RESPONDENTS

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AREA(S) OF LAW

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SUMMARY OF FACTS

APPEAL, LAW OF BANKING, PRACTICE AND PROCEDURE
SUMMARY OF FACTS
The Cross-Appellant claimed against the 1st Cross-Respondent, an order directing the 1st Defendant to credit to the account of the Plaintiff the sum of N953, 600.00(Nine hundred and fifty-three thousand, six hundred naira only) lodged by the Plaintiff into its account with the Defendant by means of teller; the sum of N1, 000,000.00 (One Million Naira) each being damages for wrongful dishonor of Plaintiff’s Cheque issued to three different people. The Cross-Appellant claimed that it lodged three cheques issued to it by its customer with the 1st Cross-Respondent in its account number 501155. Thereafter it issued three cheques for N26, 000, N3, 500 and N10, 000 which cheques were returned unpaid. It claimed that the 1st Cross-Respondent did not inform it that there was no money in the account of its customer who issued to it three cheques amounting to N953, 600. On the other hand, the 1st Cross-Respondent asserted that the three cheques amounting to N953, 600 bearing Kwacham Construction Company were returned immediately to the Cross-Appellant with a covering letter bearing the name of the manager of the Cross-Appellant’s company, intimating it that the reason for the return was because there were no funds to accommodate the cheques. After considering evidence led by parties, the Court below dismissed the claim of the Cross – Appellant against the 1st Cross – Respondent. The Court granted the alternative relief sought by the Cross – Appellant against the 2nd Cross Respondent. With the leave of this Court, the Cross – Appellant has filed a cross – appealed to this Court.

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HELD

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Appeal Dismissed

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ISSUES

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Whether the learned trial Judge was justified in holding that the 3 (three) cheques issued by the 2nd defendant/cross respondent to the plaintiff/cross appellant which were lodged into the plaintiff’s account by teller No. 689305 admitted in evidence as Exhibit ADSY/9/2001-1 were dishonoured for insufficiency of fund in the account of the drawer and in refusing to order the 1st defendant to credit the account of the plaintiff with the value thereof when the said 3 (three) cheques were not returned to the plaintiff for insufficiency of fund or at all? Whether the learned trial Judge was justified in dismissing the claims of the plaintiff/cross appellant against the 1st defendant/cross respondent for damages for wrongful dishonour of the three cheques the plaintiff issued to Bassey Nwakire, Chief U.N. Udechukwu and I.K Anya which were respectively admitted in evidence as Exhibits ADSY/9/2001-2, ADSY/9/2001-5 and ADSY/9/2001-3 in the circumstances of this case?

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RATIONES DECIDENDI

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CHEQUE – WHEN CAN A CHEQUE BE REGARDED AS MONEY?

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“A cheque is not money until it is presented and paid. Where a cheque is cleared, it puts the account of the customer in funds. See G.S. & F.C Ltd V. Obiekezie (1997) 10 NWLR (Pt. 526) 577 and Union Bank of Nigeria Ltd V. Nwoye (1996) 3 NWLR (Pt. 435) 135. Learned counsel for the Cross – Appellant sought to make heavy weather of the teller Exhibit ADSM/9/2001-1 as evidence of payment of N953, 600. Under Cross – Examination, the only witness called by the Cross – Appellant pretended that by accepting the cheques and issuing them with a teller, it showed that there was money in the account. There can be nothing farther from the truth. Accepting a cheque which is not money is no evidence that the person who issued the cheque has money in his account. It is also not true that issuing of a teller to the depositor of the cheque is evidence that the issuer of the cheque has funds for the amount on the cheques issued in his account with the bank. It is only when the cheque is cleared that is puts funds in the customer’s account.”

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WRONGFUL DISHONOUR OF CHEQUE – REMEDY AVAILABLE TO A CUSTOMER UPON A WRONGFUL DISHONOUR OF HIS CHEQUE BY A BANK

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“A bank is obliged to pay cheques drawn on it by its customer provided that the customer has sufficient fund to satisfy the amount payable on the cheque and there are no legal bars to payment. A customer whose cheque has been wrongfully dishonoured is entitled to claim damages against the bank. The claim may be for breach of contract and/or for libel. See Allied Bank (Nig) Ltd V. Akabueze (1997) 6 NWLR (Pt. 509) 374 and F.A.T.B Ltd V. Partnership Inv. Co. Ltd (2003) 18 NWLR (Pt. 851) 35 SC”.

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CASES CITED

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STATUTES REFERRED TO

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Bills of Exchange Act|

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