Breach Of Contract: Appeal Court Orders Access Bank To Pay Charismond N50 Million For General Damages

Access Bank Plc has been ordered to pay a Lagos-based Limited Liability Company, Charismond Nigeria Limited the sum of N50 million for general damages incurred in a breach of contract.

This was the judgment of a three man-panel of the Lagos Division of Appeal Court, which upheld the N50 million Judgment sum awarded by the Federal High Court, sitting in Lagos State, against Access Bank Plc, for breaching the contractual agreement between it and Charismond Nigeria Limited.

The panel consists of Justice Mohammed Lawal Garba; Justice Joseph Shagbabor Ikyegh and Ugochukwu Anthony Ogakwu. They upheld the N50 million judgment sum against Access Bank Plc, being general damages, for severe economic and financial loss suffered by Charismond Nigeria Limited, as a result of breach of contractual and legal duty of the bank.

The panel however, saved Access Bank Plc from paying the limited liability company of the N6, 397,969.05 million awarded against it by the Federal High Court, as special damages.

Justice Hadizat Rabiu-Shagari of a Lagos Federal High Court, had on June 12, 2018, while delivering judgment in a suit filed by Charismond Nigeria Limited against Diamond Bank Plc (Access Bank Plc), awarded the sum of N50 million and N6, 397,969.05 million against the bank, being general and special damages incurred by the company as a result of the bank’s breach of contractual agreement and negligent of duty.

Dissatisfied with Justice Rabiu-Shagari’s judgment, Access Bank Plc through its lawyer, Chief P. N. Umeh, in a suit marked CA/L/1359/2018, approached the Appeal Court to free it from the financial burden placed on it by judgment.

In begging the appellate court to upturn the lower court judgment, Access Bank tabled four grounds which includes;  whether the lower court was right when it granted all the reliefs claimed by the respondent without considering the documentary evidence; whether the lower court was right when it awarded special and general damages to the respondent and whether the lower court was right in arriving at its decisions without considering and appreciating its defence on Volenti non fit injuria?

Access Bank Plc also claimed that Justice Rabiu-Shagari awarded the N50 million and N6, 397,969.05 million in error in view of the provision of the exhibits presented to the court, as the special damages awarded by her were suffered and incurred by the company as a matter of choice and therefore self-inflicted.

But the limited liability company, in its argument filed before the court through its counsel, Dr. C. Mekwunye, urged the court to hold that the trial judge was right in awarding the judgment sum against the bank for breaching the contractual agreement between them.

The company’s lawyer also stated that the bank never communicated the status of the form submitted to his client and always construed the bank’s silence as approval of the forms, which was never contradicted or controverted.
 In his lead Judgment, Justice Mohammed Lawal Garba held that: “the respondent (Charismond Nigeria Limited) is in the circumstances entitled to the general damages claim for the breach of that contractual duty by the appellant (Access Bank Plc), the primary purport of which is to compensate and put the respondent as far as money could do so, to the position it would have been, had the breach by the Appellant not occurred. Okeke vs. Oche (1994) 2 NWLR (Pt. 329) 688, Roba Investment Limited vs. Arewa Metal Containers Limited (2004) LPELR-4900 (CA), Ndide vs. Ndide (2008) LPELR-4178 (CA), Elodim Nigeria Limited vs. Mbadiwe (1998) 1 NWLR (Pt. 14) 451, SPDCN Limited vs. Tiebo (1996) 4 NWLR (Pt. 445) 657, Ifere vs. Trufoods Nigeria Limited (2000) 8 WRN, 30, Ijebu-ode Local Government vs. Balogun (1991) 1 SCNJ, 1, Shukka vs, Abubakar (2012) 4 NWLR (Pt. 1291) 497. 

“Taking into account the fact that the respondent eventually cleared and utilized the goods in question and the nature of the negligence on the part of the appellant in not diligently processing the Forms “M” submitted to it by the respondent timeously, the amount of general damages awarded in favour of the respondent meets the justice of the case and I endorse same. 

“In the final result, the appeal succeeds in part in respect of the award of special damages (N6, 397,969,05), by the Lower Court which is hereby allowed. 

“The appeal fails in respect of the award of general damages (N50 million) and is dismissed in that part.

“Consequently, the award of special damages in favour of the respondent (Charismond Nigeria Limited) is hereby set aside, while the general damages in favour of the respondent is hereby affirmed.
“Parties to bear their respective costs of prosecuting the appeal”.
Agreeing with Justice Garba’s Judgment, another member of the panel, Justice Joseph Shagbaor Ikyegh held that; “I have had the honour of reading in print the robust judgment prepared by my learned brother, Mohammad Lawal Garba, with which I agree With nothing extra to add”.
Also, another member of the panel, Justice Ugochukwu Anthony Ogakwu held that: “the casus belli in this appeal is in the Forms ‘M’ which the respondents claimed that the appellant was negligent in handling; consequent upon the contractual obligation which the appellant owed the respondents was breached and the respondents further suffered losses on account of the Appellant’s negligence. 

“The leading judgment has punctiliously dealt with the accidence of the legal principles on liability for negligence and on the primary duty of the trial court to evaluate the evidence and ascribe probative value thereto. See generally OTTI vs. EXCEL-C MEDICAL CENTRE LTD (2019) LPELR-47699 (CA) and IKHINMVWIN vs. ELEMA (2014) LPELR-23322 (CA). 

“As admirably analysed in the leading judgment, the Appellant, as “authorized dealer”, was negligent by not processing the Forms M in accordance with the guidelines in Exhibits G and DWIE. Ordinarily, the Appellant ought to be liable to the Respondents tor this negligent conduct. However, the Respondents were equaly non-compliant and breached the provisions of the same Exhibit C. The parties were therefore in pari delicto and the Appellant’s failing cannot justify or excuse the Respondents’ non-compliance and breach. 

“The Latinism in pari delicto is a phrase meaning in equal fault. It is a legal term used to indicate that two persons or entities are equally at fault, this being so, the court would not hold the appellant liable to the respondents for its negligence in handling the Form, since the respondents were equally negligent in same regard. See Nwaolisah Vs Nwabufor (2011) LPELR (2115) 1 at 27-28. 

“The banker/customer relationship is contractual: Bank of the North vs. YAU (2001) LPELR (748) 1 at 45-45 and UBN Plc vs. Ajabule (2011) LPELR (8239) 1 at 39. The mishandling of the Forms ‘M’ transaction by the Appellant is a breach of the contractual relationship between it as banker and the respondent as customer. The respondents having claimed reliefs both for the tort of negligence and for breach of the contractual relationship are entitled to a remedy for the breach of contract. 

“It’s for the foregoing reasons and the more elaborate reasoning and conclusion articulated in the comprehensive leading judgment of my learned brother, Mohammed Lawal Gaba, JCA which I was privileged to read in draft, that I equally allow the appeal in part and on the same terms as set out in the leading judgment. I abide by the order as to costs”.