Ladipo Sanusi/
Stanbic-IBTC Bank was stunned Tuesday as a High Court in Lagos slammed a N50 billion fine on the financial institution for breach of contract.
Justice Candide-Johnson ordered the bank to pay the sum of N50 billion as general damages, to one of its customers, Long-term Global Capital Limited, for breaching a contractual agreement between them.
Apart from the judgement sum, the judge also ordered the bank and CRC Credit Bureau Limited, who is a joint defendant in the suit filed by Longterm Global Capital Limited, to publish forthwith within seven days, a retraction and apology to the claimant in the cover pages of Sunday and Monday editions of the Punch, ThisDay and The Guardian newspapers, in respect of the alleged indebtedness of the claimant to the bank.
Justice Candide-Johnson also directed CRC Credit Bureau Limited, to immediately delete from its electronically published data bank and all other publications, all references to the alleged indebtedness of the bank’s customer to the bank.
The judge further made an order of perpetual injunction restraining Stanbic-IBTC Bank and CRC Credit Bureau Limited, from further publishing any other material or details relating to the alleged indebtedness of the claimant.
Finally, the Court also ordered the payment of interest on the above judgement sum at the rate of 10 percent per-annum from the date of judgement of the Court, until the date of the final payment by the defendants in line with the provision of Order 35 Rule 4 of High Court of Lagos State (Civil Procedure) Rules, 2012.
The orders followed a suit marked ID/377/2013, brought before it by the stock broking firm against the bank and CRC Credit Bureau Limited.
The plaintiff, in its statement of claim filed by its lawyer, Chief Felix O. Fagbohungbe (SAN), alleged thus: “That on or about April 2, 2014, pursuant to the banker/customer relationship between it and the bank, it applied to Union Bank of Nigeria Plc for a term loan of N250 million for the purchase of a commercial property at Lekki Phase 1, in Lagos, which would have been prime property if acquired and developed into a multi-storey ultra modern apartment complex for sale to various property investors.
The claimant also averred that due to the urgent nature of the purpose of the loan application at the material time, its relevant officials made several follow-up visits to Union Bank, to inquire about the state of processing of its loan application. But, its officials were verbally informed by Union Bank that credit status check were being conducted at relevant credit bureaus in respect of its loan transaction with other banks in the country. The bank later wrote a letter stating that it would be unable to grant the loan due to unfavourable credit report which was electronically published by the data bank of Credit Bureau Limited who is the second defendant in the suit to the whole world with the Central Bank of Nigeria’s directive.
The claimant further stated that by Union Bank’s letter, it was informed that pursuant to the mandatory requirement of CBN directing that every bank and Financial institutions in the country must obtain credit status reports from at least two credit bureaus before granting any credit facility to their customers, the Union Bank applied for and obtained it’s credit status from the second defendant and Messrs Credit Registry Plc, as part of the processing of its loan application.
It further stated in the report sent by Union Bank that its credit status with first defendant was tagged ‘clean’, while report from the second defendant was said to be unsatisfactory and it became aware that the Stanbic IBTC had reported to the CRC Credit Bureau Limited on or about October 31, 2012, that the bank deliberately, falsely and maliciously wrote and published a credit status report through the second defendant concerning it that it has been blacklisted by the first defendant as a loan defaulter and bad loan borrower who was owing the sum of N543, 030, 843 for 722 days running as at October 31, 2012, and which numbers of days was over and above the maturity date of December 31, 2009.
The claimant further averred that Stanbic-IBTC stated that the interest outstanding on the loan, as at December 31, 2012, stood at N213, 537, 753.
The claimant also stated that contrary to the false, injurious and Malicious credit status reports published by Stanbic-IBTC, through CRC Credit Bureau Limited, to the whole world including Union Bank, there was no time that the first defendant granted it any credit facility which would be classified as ‘lost’ in respect of which account balance in the sum of N543, 030, 843, with the accrued interest in the sum of N213, 537, 753, or any other sum at all were outstanding against it.
It also stated that to the foregoing, Union Bank Plc relied on the defendants’ credit status information and declined granting its term loan, which was required to purchase a commercial property.
It added that the plaintiff, apart from not being indebted to the first defendant, was neither informed by the Stanbic-IBTC that it was indebted nor was any demand made in that regard before the malicious falsehood was reported by the first defendant to the second-defendant, which subsequently published the false and untrue credit status reports to Union Bank and the whole world.
It also stated that the credit status reports made to the second defendant by the first defendant in relation to the alleged indebtedness was made without just cause or excuse as there was never a time the first defendant granted it any credit facility which can be classified as ‘lost’ or ‘bad’, which it did not pledge adequate and readily realizable collateral security to cover the principal loan amount plus interest.
Consequently, due to the deliberate, malicious and/or injurious falsehood published by the defendants in relation to the credit status, it has been unable to access any credit facility from Union Bank and all other financial institutions in Nigeria, as it has been blacklisted and embargoed from accessing new credit.
According to the claimant, the false, malicious and injurious falsehood of the defendants has adversely affected its business reputation, as all its bankers and Financial institutions are no longer able or permitted to grant any credit facility to augment its working capital for reason that it has been effectively blacklisted by being classified as a bad or delinquent borrower and consequently shut-out of Nigeria’s credit system.
The claimant also averred that the malicious and injurious falsehood by the defendants was calculated, embarrassing, de-marketing and had caused huge pecuniary damage as a registered capital market institution, and that the main objective of the defendants in deliberately, wilfully and intentionally publishing the malicious and injurious falsehood credit report, was to asphyxiate and paralyze its investment activities and capital operation, and to untimely make its business collapse without just cause.
Consequently, the claimant urged the court to award the sum of N50 billion as general damages against Stanbic-IBTC and CRC Credit Bureau jointly and severally, and the sum of N50 million as cost of instituting the suit.
It also sought an order of the Court directing the defendants to immediately delete from its electronically published data bank, and all other publications all references to the alleged indebtedness and an order directing the defendants to publish a retraction and, or, apology to it on the cover of Sunday or Monday edition of two national newspapers, in respect of the alleged indebtedness.
It also sought an order of perpetual injunction restraining the defendants from further publishing any other materials or details relating to the alleged indebtedness.
Stanbic-IBTC, in its statement of defence, denied all the claimant’s averment, thereby urging the Court to dismiss the suit in its entirety with substantial cost in its favour.
In urging the Court to dismiss the claimant’s suit, the bank averred that the claimant maintains an account with its Adetokunbo Ademola branch, and at all material time, the transaction on the said account were recorded electronically by its computer system. It added that between April 2008 and June 2011, the transactions were recorded in Account Number 1111314381, under the Equinox Core Banking System, and between July 2011 and the time of instituting the suit, the transactions were recorded in Account Number 9200689089, under Finacle Core Banking System.
It also stated that it did not author the credit status report cited by the claimant but merely provided the second defendant with the status of the Credit facility obtained by the claimant from it in discharge of its obligations under the guidelines for the Licensing, Operation and Regulations of Credit Bureau in Nigeria (CBN Licensing Guidelines).
It stated that the aforementioned information it provided to the second defendant was true and consistent with its records, and were not borne out of ill-will or malice and were not intended to disparage the claimant’s trade of business as alleged.
Stanbic-IBTC also stated that the claimant’s indebtedness arose as a result of a credit in the sum of N600 million, by virtue of a Letter of Offer dated March 27, 2008, adding that the said indebtedness had been subject of litigation since December 23, 2009, in a suit marked FHC/L/CS/1491/09, Re: Longterm Global Capital Limited and Patrick Akinkotu vs. Stanbic-IBTC, Appeal No. CA/L/194/2011, Stanbic IBTC vs. Longterm Global Capital and Patrick Akinkotu, and that a notice of appeal dated May 13, 2013, in respect of the matter was filed at the Supreme Court of Nigeria on a motion on notice dated May 13, 2013.
It also stated that the said indebtedness had been acknowledged in the judgement by the Federal High Court, in suit number FHC/L/CS/1491/09, Re: Longterm Global Capital Limited and Patrick Akinkotu vs. Stanbic-IBTC by Justice Achibong.
The bank argued that the claimant’s Statement of Claim did not disclose a reasonable cause of action, and the action was vexatious, frivolous and malicious, consequently, the court lacks jurisdiction to entertain the suit.
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