Background
In January 2014 the appellants, Chief Lawson Okafor and Saviour Bureau de Change, applied to the Central Bank of Nigeria for a licence to operate a Bureau de Change (BDC). They paid the initial capital deposit of N10,000,000.00 and agreed by letter to comply with all statutory provisions, guidelines and circulars issued by the Bank from time to time (exhibit SBDC 9). While the application was pending, the respondent revised its BDC guidelines in June 2014, increasing the minimum capital requirement from N10,000,000.00 to N35,000,000.00. Finding the new amount unaffordable and fearful of further upward revisions, the appellants withdrew their application and obtained a refund of their deposit with interest. They then sued for declarations of breach of contract and claims for special, general and exemplary damages in the Federal High Court, Abuja.
Issues
- Whether the appellants received sufficient notice under section 59(5) of the Banks and Other Financial Institutions Act (BOFIA) before variation of the BDC guidelines.
- Whether sections 52 of the Central Bank of Nigeria Act and 53(1) of BOFIA immunize the respondent from suit in the absence of bad faith.
- Whether the Court of Appeal erred in setting aside awards of special, general and exemplary damages despite uncontradicted evidence.
- Whether there existed a valid contract between the parties to sustain a claim for breach.
Ratio Decidendi
- Section 59(5) BOFIA requires notice of variation and an opportunity to make representation, which may be actual, constructive or implied. Acting on a public circular obtained during a visit suffices as notice.
- Sections 52 CBN Act and 53(1) BOFIA protect the Bank, its officers and the Federal Government from actions in respect of anything done in good faith pursuant to statutory powers. A plaintiff must plead and prove bad faith at the threshold to override the immunity.
- Pleadings are binding on parties and the court; facts admitted need no proof; evidence not in conformity with the pleadings goes to no issue; special damages must be specifically pleaded and strictly proved.
- A valid contract requires mutual agreement, offer, acceptance and consideration. No enforceable contract existed once the appellants voluntarily withdrew their application and accepted a refund.
Court Findings
The Supreme Court, in a unanimous lead judgment delivered by Abba-Aji JSC, held that:
- The appellants acted on correct notice of the revised guidelines and admitted the guidelines as part of their statutory relationship, so no further proof of notice was required.
- No allegation or proof of bad faith was pleaded or established. The Bank’s statutory immunities therefore applied, depriving the court of jurisdiction over claims save for bad faith.
- The appellants’ pleadings failed to include facts supporting entitlement to the reliefs claimed. The trial court exceeded the bounds of the pleadings and admitted irrelevant evidence.
- The claims for special damages lacked particulars and proof; the awards were improperly granted.
- The appellants did not establish the existence of an enforceable contract which was breached.
Conclusion
The Supreme Court dismissed the appeal, affirmed the Court of Appeal’s decision setting aside the Federal High Court’s awards, and ordered that each party bear its own costs.
Significance
This decision clarifies the scope of statutory immunities under the CBN Act and BOFIA, the interpretation of notice requirements for regulatory variations, and reinforces the strict adherence to pleadings and proof of special damages in contractual claims against regulatory bodies.