CORAM
ALEXANDER, JUSTICE, SUPREME COURT
SOWEMIMO, JUSTICE, SUPREME COURT
OKAY ACHIKE JUSTICE, SUPREME COURT
PARTIES
AFRICAN CONTINENTAL BANK LTD
APPELLANTS
FESTUS SUMIOLA YESUFU
RESPONDENTS
AREA(S) OF LAW
BANKING – BILL OF EXCHANGE- LETTERS OF CREDIT
SUMMARY OF FACTS
The appellants instituted action against the respondent in respect of all the bills in form of letters of credit that were dishonoured by non-payment. The lower court dismissed the suit on the ground that the appellants did not give the respondent notice of the dishonour of the bills.
HELD
The court allowed the appeal and held that the appellants were not bound to give notice of dishonour of letters of credit being a revocable instrument.
ISSUES
The court allowed the appeal and held that the appellants were not bound to give notice of dishonour of letters of credit being a revocable instrument.
RATIONES DECIDENDI
DUTY ON A BANKER TO GIVE NOTICE OF DISHONOUR OF A BILL, WHETHER APPLIES TO LETTERS OF CREDIT
A banker has no legal duty to give notice of dishonour of a revocable credit to his customer – Bello J.S.C.
DUTY ON A BANKER TO GIVE NOTICE OF DISHONOUR OF A BILL, WHETHER APPLIES TO LETTERS OF CREDIT
the duty of a banker to give notice of dishonour of a bill to his customer relates to a bill which is a bill of exchange within the definitions of Sections 2 and 3 of the Bills of Exchange Act, 1882- Bello J.S.C
LIABILITY OF A COLLECTING BANK WHO COLLECTS AMOUNT LESS THAN THE FACE VALUE OF A BILL
a collecting banker has a duty to collect the face value of a bill and if he collects any amount less than the value of the bill he may be liable to his customer for a breach of contract – Bello J.S.C
CASES CITED
Cape Asbestos Co. Ltd. v. Lloyds Bank Ltd. (1921) WN 274 cited in 3 Digest (Replacement) p.285 para.855
STATUTES REFERRED TO
Not Available