⦿ CASE SUMMARY OF:
Trade Bank Plc v. Benilux (Nig.) Ltd. (2003) – SC
TRADE BANK PLC
BENILUX (NIG.) LTD.
 9 NWLR (PT.825)416;
⦿ LEAD JUDGEMENT DELIVERED BY:
U. MOHAMMED, J.S.C
⦿ LAWYERS WHO ADVOCATED
* FOR THE APPELLANT
– Layi Babatunde;
* FOR THE RESPONDENT
– Professor S.A. Adesanya, SAN
⦿ FACT (as relating to the issues)
Benilux (Nigeria) Limited, who hereinafter shall be referred to as the respondent, had business transaction with Messrs Accountable Finance and Investment Company. As a result of the business transaction Messrs Accountable Finance and Investment Company Limited, issued cheque No. 03370- 031150013 A/C No. 102-3720151-01-95, dated 27th January, 1993, in the sum of N1,000,000.00 (One Million naira) payable to the respondent. The cheque was marked “A/C Payee only” and “Not Negotiable”. It was to be drawn on the account of the company at Martins Street Branch of the Trade Bank PIc. Trade Bank PIc is the appellant, in this appeal. In the cheque the appellant was mandated to pay the sum of N1,000,000.00 to the respondent. Instead of paying the amount to the respondent the appellant paid the one million naira to a stranger. When the respondent found out what had happened it challenged the appellant on the wrongful payment. The appellant accepted responsibility, but pleaded for time to enable it rectify the situation and make payment properly to the respondent. When the waiting was too long and the payment was not forthcoming the respondent went to the Lagos High Court.
Soon after the action had been filed, learned counsel for the respondent, Professor Adesanya, SAN, filed and argued an exparte motion with the following prayer:
“An order of interim injunction (Mareva) restraining the defendants, their servants and/or agents from removing from the jurisdiction, disposing of and/or dealing with their assets within the jurisdiction in so far as the same do not exceed the sum of N2,000,000.00 and in particular its bank balance with the Central Bank of Nigeria or their claims thereto until the determination of the Motion on Notice”.
The application was granted. The order was served on the Central Bank which attached the sum of N2 million in the account of the appellant kept with the Central Bank. In response to this order the appellant by way of motion on notice, dated 14/12/94, prayed for striking out the suit for lack of jurisdiction of the trial court. Alternatively, the appellant prayed for the vacation of the Mareva injunction. In a considered ruling, the trial High court Judge held that the State High Court had jurisdiction to hear the suit. Secondly, he declined to vacate the Mareva injunction which he granted earlier.
Dissatisfied with the said ruling, the appellant filed an appeal to the Court of appeal. Before the hearing of the appeal, at the Court of Appeal, the appellant filed a motion and prayed for an order substituting the order granted by the High Court attaching the appellant’s N2,000,000.00 with the Central Bank of Nigeria with a bank guarantee from any reputable bank in Nigeria. The application was granted. The Court of Appeal ordered the appellant to provide a bank guarantee in the sum of N2,000,000.00 from Afribank Plc. The bank guarantee was lodged in Afribank Plc on 26th November, 1996. The Court of appeal thereafter heard the appeal and delivered its judgment on 29th May, 2000. The appeal filed by the appellant was dismissed. It is against the said judgment that the appellant has filed this appeal.
1. Whether the High Court of Lagos State is vested with jurisdiction to hear and determine the plaintiff’s claim?
⦿ HOLDING & RATIO DECIDENDI
1. ISSUE 1 WAS RESOLVED IN FAVOUR OF THE RESPONDENT BUT AGAINST THE APPELLANT.
i. I have no doubt that the respondent, in the case in hand, can sue the appellant in conversion for the proceeds of the cheque which the appellant paid to a stranger who is not the payee of the cheque. The plaintiff/respondent’s case is simply a tort of conversion and the action filed by the plaintiff/respondent against the appellant can be entertained by any State High Court. See 7up Bottling Company Limited & Ors. v. Abiola and Sons Bottling Company Limited (2001) 13 NWLR (Pt. 730) 469; (2001) FWLR (Pt. 70) at page 1650. Having failed to have this issue resolved in its favour this appeal has accordingly failed and it is dismissed.
⦿ SOME PROVISIONS
⦿ RELEVANT CASES
⦿ NOTABLE DICTA
An issue in dispute is the subject of litigation. It is a matter for which a suit is brought and parties join issues for the determination of the dispute. Courts will only consider a justifiable controversy upon existing state of facts and not upon hypothetical dispute or academic moot. – U. MOHAMMED, J.S.C. Trade v. Benilux (2003)
Now, it is settled law by a long string of authorities that bankers who collect cheques and pay them to those not entitled to the proceeds in the cheques are guilty of the tort of conversion. – U. MOHAMMED, J.S.C. Trade v. Benilux (2003)
In the instant appeal, although the appellant was mandated to pay the cheque valued at N1,000,000.00 to the respondent, it paid it to a third party who is entirely a stranger to the transaction. That does not qualify as a bank transaction in which section 230(1)(d) applies. It is clearly a tort of conversion which has nothing to do with the exclusive jurisdiction of the Federal High Court. – Niki Tobi, J.S.C. Trade v. Benilux (2003)