The Court of Appeal sitting in Lagos on Monday granted the appeal of Guaranty Trust Bank (GTB), overturning the N507 million judgment previously awarded to Chashar Farms Ltd, a company linked to former Akwa Ibom State governor, Udom Emmanuel.
Delivering judgment, Justice Okong Abang nullified the decision of the Lagos State High Court, citing a “miscarriage of justice” occasioned against the bank.
As Nairametrics exclusively gathered, GTB had appealed the lower court’s judgment delivered on February 8, 2022.
What the Appeal Court said
Ruling on the merits, Justice Abang noted that the trial court’s judgment was contradictory.
- He observed that the sum of N507 million, which a police investigation allegedly revealed was transferred from the respondent’s account through collusion with Oyetola O., was the same amount the trial court awarded in favour of the respondent.
The judge held that the matter involved serious disputes of fact and that the trial court ought to have declined summary judgment(a court ruling issued without trial), directing parties to proceed to a full trial where oral evidence could be led.
- “The trial court was clearly wrong in making those findings at the interlocutory stage without hearing the parties on the merits,” he said.
Justice Abang further observed that the trial court relied on the extra-judicial statement of Oyetola O. made to the police, which was not tested under cross-examination, before finding the bank liable.
- “Relying on that statement without allowing for proper interrogation denied the appellant the right to fair hearing, contrary to Section 36 of the 1999 Constitution,” he added.
He held that the issues raised in the appellant’s counter-affidavit and statement of defence were complex and unsuitable for resolution under summary judgment procedure.
The court also noted that while Chashar Farms Ltd claimed it invested N507 million with the bank and that the funds were mismanaged, the bank denied any wrongdoing.
- “In all honesty, this case presents serious triable issues, where a party that withdrew funds from its account seeks a refund,” the judge stated.
Justice Abang further pointed out that the trial court failed to consider the police report indicating that the company’s director, former Akwa Ibom Governor, Udom Emmanuel, did not honour an invitation for questioning during the investigation.
- “If the respondent claims it did not authorise the transfer, why did it fail to cooperate with the police investigation?” he queried.
- The court held that accepting the respondent’s claims without a proper hearing of the bank side “occasioned a miscarriage of justice.”
The judge also noted that allegations of forgery and fraud were raised, including claims that the withdrawal instrument was not signed by the company’s director.
He emphasized that under Sections 133(1) and 133(2) of the Evidence Act, such allegations require proof beyond reasonable doubt.
- “This appeal has merit. The judgment of the trial court is hereby set aside and nullified,” Justice Abang ruled.
The court ordered that the suit be remitted to the Chief Judge of the Lagos State High Court for reassignment to another judge.
Costs of N1,000,000 were awarded in favour of the bank.
What you should know
Following the appellate ruling, the case will commence afresh at the Lagos State High Court for full hearing and determination except if the disagreeing parties choose to seek redress at the Supreme Court.
At the lower court, both parties are expected to call witnesses and present evidence upon which the court will base its final judgment.
The ruling adds to a growing list of favourable appellate decisions secured by GTB in high-value financial disputes.
