⦿ CASE SUMMARY OF:
MainStreet Bank Ltd. v. Mrs. Lilian Halim Abi Chahine (2014) – CA
MainStreet Bank Ltd.
Mrs. Lilian Halim Abi Chahine
Court of Appeal
⦿ LEAD JUDGEMENT DELIVERED BY:
Ibrahim Mohammed Musa Saulawa;
⦿ LAWYERS WHO ADVOCATED
FOR THE APPELLANT
FOR THE RESPONDENT
The original plaintiff died, and was substituted by his wife.
The appellant who was the defendant at the high court got judgement given against it because of a negligent act it committed against the respondent (Plaintiff at the the High Court).
The fact of the case is such that, the respondent took a loan from the appellant, and on the request of the Appellant for a guarantee, the respondent used his foreign bank (BIAO) at oversea as a guarantee. However, before the expiry of the guarantee the respondent paid the loan back and hence told the appellant to tell the oversea bank to cancel the guarantee since it has been settled. However, the appellant fail to do so, and the respondent account reserved for the guarantee remained been blocked. When a customer of the respondent attempted to cash a cheque, the cheque was bounced. And so the respondent instituted this action at the lower court demanding for damages.
1. Whether there was a privity of contract between the parties, if yes, whether the case falls within the scope of exceptions to the privity of contract?
2. Was Late F.H Khoury a party to the contract of guarantee in this case, and was he and the role allegedly played by him within the contemplation of the contract document exhibit “A” which showed the clear intention of the parties to the contract of guarantee?
3. Was F.H Khoury both General Manager and Manager Director of Warratem Engineering Company Ltd., and also the man behind the veil of incorporation of the company?
4. Did the learned trial judge fail in his judicial duty when he omitted to make a finding as to whether the purported account of late F.H El-Khoury with BIAO London was a deposit or a current account?
5. Was the learned trial judge right in holding that an action of this nature claiming damages to late F.H El-Khoury reputation can survive the deceased F.H El-Khoury?
6. Was the entire role played by Late F.H Khoury as alleged by him not in violation of the provisions of Exchange Control Act 1962, Cap 113 LFN 1990 both of which were in force at the time material to this case?
7. Was it right for the learned trial judge to hold that BIAO London acted as agent to the defendants/appellant in this case to make the defedant/appellant liable for the act of the said BIAO London?
8. Did the Learned Trial Judge apply the correct principles of law relating to award of damages, and were the damages awarded to the plaintiff/respondent in this case not clearly excessive and unreasonable?
⦿ HOLDING & RATIO DECIDENDI
1. The Court of Appeal held that there was privity of contract between the appellant and the respondent. The reason being that the deceased plaintiff used his personal account to secure the loan for and on behalf of Waratem Eng. Co. Ltd. Further, his account was used as security for the loan with BIAO.
⦿ SOME PROVISIONS
⦿ NOTABLE DICTA
The word “Privity” means the relationship or connection between two or more parties, each having a legally recognised interest in the same subject matter, such as in a transaction, proceeding, or piece of property. Also termed mutuality of interest.