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Unlawful Account Freeze: EFCC and Banks Cannot Take Laws into Their Hands

Debtors & Recovery	6805 VIEWS
Debtors & Recovery
6805 VIEWS

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Tuesday, January 14, 2020 / 05.47AM / By Unini Chioma of TheNigeriaLawyer / Header Image Credit: Lawyard

"This is a society whose affairs are supposed to be governed and conducted in accordance with the law. The EFCC and the bank taking law into their hands is nothing but shameful."

An Ikeja High Court has ordered Diamond Bank Plc (Access Bank Plc) to pay a Lagos-based legal practitioner, Adetokunbo Odutola, Twenty Five million naira (N25m) as damages for unlawfully freezing his bank account.

Justice S.O. Nwaka held that the bank failed in its duty of care to Odutola and was thus liable for the injury that arose therefrom.

The court held as unacceptable the bank's contention that it froze the lawyer's account on the Economic and Financial Crimes Commission's instruction, noting that only a court could make such an order.

Justice Nwaka delivered the judgment in a suit marked LD/ADR/800/17 between Odutola as sole claimant and Diamond Bank as the sole defendant.

The suit originally involved three banks as defendants but the first and third defendants settled with the lawyer out of court, leaving Diamond as the remaining defendant.

The Case

In his statement of claim, Odutola, who represented himself, sought N25m against the bank as both special and general damages he incurred due to the bank's "negligence and breach of duty of care".

He averred that he "suffered embarrassment, hardship, disgrace and loss of income" following the unlawful freezing of his account.

In particular, the lawyer averred that a cheque he issued was rejected by the bank, his practice was financially affected and he had to resort to borrowing "N500,000 to repay N750,000" from a money lender.

The lawyer further stated that during the blockage, he was "engaged in a brief which would have earned him N10mi" but which he lost.

But Diamond Bank, through its counsel, Olatunji Muritala, countered that the cheque was dishonoured on November 29, 2016 when it got a letter from the EFCC asking it to place a lien on the customer's account.

It also challenged the claim for N25m on the ground that Odutola "failed to prove any economic loss suffered when his account was placed on Post No Debit".

The defendant urged the court to dismiss the suit in its entirety and refuse all reliefs sought, with substantial cost against the claimant.

The Judgment

In her judgment of December 16, 2019, the judge upheld the lawyer's claims.

Justice Nwaka held, "The bank went ahead to place PND on the account of the claimant on the instruction of the EFCC. The bank ought to have demanded from the EFCC an order of court to that effect.

"It is not in the power of the EFCC to authorise a PND on any customer's account. The EFCC must not usurp the powers of a court of law. The duty of care owed the claimant by the second defendant (Diamond Bank) is nothing but breached."

The judge said the bank's inaction of not demanding for an order of court or an official letter authorising it to place PND on the claimant's account "amounts to negligence. And this negligence is traced to the embarrassment and loss suffered by the claimant.

"This is a society whose affairs are supposed to be governed and conducted in accordance with the law. The EFCC and the bank taking law into their hands is nothing but shameful."

"I am satisfied that the claimant has proved his case on the preponderance of evidence and I so hold. Judgment is hereby entered for the claimant against the second defendant as per his claims."