UNITY BANK PLC V. COLONEL BELLO MOHAMMED AHMED (RTD) (2019)

Background

This appeal arose from a banker–customer dispute concerning a loan or facility arrangement between Unity Bank Plc and Colonel Bello Mohammed Ahmed (Rtd). The respondent commenced proceedings at the High Court of Kebbi State, claiming, among other reliefs, the release of his title document covered by Certificate of Occupancy No. BI/G/0494, declarations concerning the facility and interest charged, and general damages. His case was that the agreed tenure of the facility had expired, that the bank had no contractual right to continue charging interest outside the agreed period, and that the bank had failed to make adequate disclosure concerning the alleged acquisition or transfer of the relevant liability and security to the Asset Management Corporation of Nigeria (AMCON).

The trial court entered judgment for the respondent. Unity Bank appealed to the Court of Appeal, Sokoto Division, but the appeal was dismissed on 3 December 2014. The bank then appealed to the Supreme Court on five grounds. The central complaints related to the respondent’s reliance on contractual documents, the effect of the bank’s failure to file a reply brief, the alleged necessity of joining AMCON, the bank’s obligation to explain the outstanding debit balance and accumulated interest, and the competence of the respondent’s monetary claim in view of alleged non-payment of filing fees.

Issues

1. Whether the appellant’s failure to file a reply brief or make an oral response to arguments concerning Exhibits A and B prevented the Court of Appeal from properly considering Exhibit H, which allegedly showed the outstanding debt and accrued interest.
2. Whether the respondent was required to join AMCON, or whether the bank had the responsibility to provide evidence and documentation concerning the transfer or acquisition of the respondent’s liability and title documents.
3. Whether the alleged failure to pay a filing fee on a specific monetary relief deprived the courts of jurisdiction to consider or award that relief.

Ratio Decidendi

The Supreme Court held that a reply brief is recognised under Order 18 rule 5 of the Court of Appeal Rules 2011, but it is not mandatory in every appeal. It is an optional procedural opportunity available to a party wishing to answer new points of law or adverse submissions raised in the opposing brief. However, where new and material arguments are raised and the appellant elects not to respond, the appellant cannot later complain that the court failed to address matters which it left unanswered. In the circumstances of this case, the bank’s failure to address the respondent’s arguments on the proper interpretation of Exhibits A and B, read together with Exhibit H, meant that the arguments were effectively left unchallenged.

The Court further reaffirmed that disputes arising from banking facilities must be resolved primarily by reference to the written agreements and related banking documents. Banking transactions are formal and highly regulated. Courts must enforce the terms chosen by the parties and must not introduce extraneous meanings or rewrite the agreement. The parties were therefore bound by the tenure and interest provisions contained in Exhibits A and B.

On interest, the Court held that a bank cannot unilaterally vary an agreed interest rate where the contract contains a clear rate and no provision authorising variation. Section 15 of the Bank Act 1969 required licensed banks to charge interest in accordance with applicable Central Bank guidelines, but that statutory framework did not give a bank licence to impose arbitrary or unilateral charges contrary to its contract with the customer. A unilateral alteration of the agreed rate was treated as an attempt to create a new contractual term without the customer’s acceptance.

The Court also held that a bank claiming money on the basis of an overall debit balance must provide both documentary and oral evidence explaining how the balance was calculated. A bare statement of account, without a satisfactory explanation of the accumulation of interest and charges, is insufficient where the customer disputes liability. The burden of proof in civil proceedings is not static. Under sections 131 to 134 of the Evidence Act 2011, it shifts as one party produces evidence capable of establishing or displacing a fact. In this case, the bank failed to produce credible evidence contradicting the respondent’s case.

Court Findings

Regarding AMCON, the Court relied on section 31 of the AMCON Act 2010. Where AMCON acquires an eligible bank asset, the financial institution from which it was acquired must deliver relevant books, records and title documents and execute instruments necessary to properly document the acquisition. The bank’s assertion that AMCON had acquired the liability, without producing adequate transfer documentation or clearly explaining the transaction, concerned facts especially within the bank’s knowledge under section 140 of the Evidence Act. The respondent could not fairly be expected to join AMCON on the basis of an unsubstantiated assertion by the bank.

The Court rejected the challenge to the monetary relief. The respondent’s claim was for general damages, which are discretionary and are not necessarily a fixed debt requiring the same treatment as a liquidated monetary claim. The alleged procedural objection therefore did not defeat the jurisdiction of the trial court or invalidate the award. Since the respondent proved a breach of the banker–customer contract, the award of damages was proper. The Court stated that damages may follow naturally from a proved contractual breach even where precise actual loss is not established, provided the award is justified by the circumstances.

The Supreme Court also declined to interfere with the concurrent findings of the High Court and Court of Appeal. An appellate court may intervene where findings are perverse, unsupported by evidence, or have resulted from a miscarriage of justice. It will not, however, substitute its own assessment merely because another view of the evidence is possible. The findings in favour of the respondent were supported by the documentary evidence and were not shown to be perverse.

Conclusion

The appeal was dismissed in its entirety. The Supreme Court affirmed the concurrent judgments of the High Court of Kebbi State and the Court of Appeal. Unity Bank Plc was ordered to pay costs of N1,000,000 to the respondent.

Significance

The decision reinforces contractual certainty in Nigerian banking transactions. It confirms that banks must honour agreed facility terms, must not impose unilateral interest increases without contractual authority or customer consent, and must explain disputed debit balances with reliable evidence. It also clarifies the practical consequence of failing to answer new points raised in a respondent’s brief and places responsibility on a bank to disclose transaction records and AMCON-transfer documents within its special knowledge. The judgment is consequently important for loan recovery actions, disputes over title documents, claims for excessive interest, and appellate challenges to concurrent findings of fact.