In the Supreme Court of Nigeria
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Held at Abuja
On Friday, the 6th Day of March, 2026
Before Their Lordships:
- Mohammed Lawal Garba, JSC
- Tijjani Abubakar, JSC
- Haruna Simon Tsammani, JSC
- Habeeb Adewale Olumuyiwa Abiru, JSC
- Jamilu Yammama Tukur, JSC
SC/CV/50/2018
Between:
Union Bank of Nigeria Plc — Appellant
And:
- Prince Nwokocha Ezikpe (Trading under the name and style of Felimex Mercantile Nigeria Alliance)
- Felimex Nigeria Limited — Respondents
Lead Judgment delivered by Honourable Justice Mohammed Lawal Garba, JSC
Facts
Between May 1982 and January 1983, the Appellant, acting on the instructions of the Respondents, debited the 2nd Respondent’s account with the Naira equivalent of US$217,381.05 for remittance to their overseas business partners as payment for goods supplied. The remittance was to be made in accordance with the relevant foreign exchange regulations, which required all payments in foreign exchange to be made by the Central Bank of Nigeria upon an application by a domestic bank. Accordingly, the Central Bank of Nigeria would issue promissory notes in favour of the Respondents’ foreign business partners. However, the funds were not remitted, prompting the Respondents to make inquiries through letters and visits to the Appellant’s offices. The issue, however, remained unresolved.
Consequently, the Respondents commenced an action at the trial court by a Writ of Summons filed on 20th August, 2008, seeking the recovery of the sum of US$217,381.05 or its Naira equivalent; interest at 19.5% per annum on the sum claimed, from January 1983 until final liquidation; ₦5 million in general damages for breach of contractual banking obligations; and the costs of the action.
In its Amended Statement of Defence, the Appellant contended that the action was statute-barred as of 20th August, 2008, when the Writ of Summons was issued. The trial court, nevertheless, entered judgment in favour of the Respondents and granted the reliefs sought. Dissatisfied with the decision, the Appellant appealed to the Court of Appeal, which affirmed the decision of the trial court and dismissed the appeal.
Issues for Determination
- Whether the Respondents’ action is statute-barred, having regard to when their cause of action arose and when they became aware that the Appellant had failed to remit the debited funds.
- Whether the Court of Appeal was right to hold that Exhibits D3 and D5 constituted documentary hearsay and that the Appellant had failed to adduce credible evidence that the funds deducted from the Respondents’ account had been remitted to the Central Bank of Nigeria.
Arguments
On issue one, the Appellant argued that the Respondents’ action was statute-barred because the cause of action arose in 1983 or, at the latest, in 1987, when the 1st Respondent became aware that the Appellant had failed to remit the debited funds to their foreign business partner. Counsel submitted that an action instituted outside the limitation period is invalid and deprives the court of jurisdiction to entertain it, relying on Abubakar v. Michelin Motor Tyre Services Ltd (2020) LPELR-50832 (SC); Bello v. Yusuf & Ors (2019) LPELR-47918 (SC).
The Appellant further contended that the lower courts erred in holding that the cause of action arose on 14th March, 2005, when the Respondents allegedly received a letter from the Central Bank of Nigeria (CBN) confirming that it had no evidence of the Appellant’s remittance. The 1st Respondent had admitted under cross-examination that he knew as far back as 1983 or, at the latest, 1987, that the funds had not been remitted. The Appellant emphasised that the failure of the Respondents to demand a refund until 2004 demonstrated that they had slept on their rights and that their action was statute-barred.
Furthermore, Counsel submitted that the lower court had misapplied Union Bank of Nigeria Plc v. Umeodeagu (2004) 13 NWLR (Pt. 890), as the facts of that case were materially different from those of the present appeal. He argued that the CBN’s letter of 14th March, 2005, provided no new information, as the Respondents had known since 1987 that the funds had not been remitted. He maintained that the cause of action, therefore, accrued in 1987 and was statute-barred when the action commenced in 2008.
He relied on the Union Bank case and Adejumo v. Olawaiye (2014) 12 NWLR (Pt. 1421) 252 to submit that the Respondents failed to discharge their burden under Section 131(1) of the Evidence Act, 2011, to prove, through credible evidence, when their cause of action arose.
Finally, the Appellant argued that the transaction did not involve a cash deposit or credit transaction and, therefore, did not create a debtor-creditor relationship between the Appellant and the Respondents. He submitted that a banker becomes a debtor to its customer only in respect of funds credited to the customer’s account, relying on Allied Bank of Nigeria Ltd v. Akabueze (1997) LPELR-429 (SC).
Arguing issue two, the Appellant submitted that the Court of Appeal erred in affirming the decision of the trial court to treat Exhibits D3 and D5 as documentary hearsay and deny them probative value. He submitted that DW1, although neither the maker of the exhibits nor an officer of the Debt Management Office, could validly tender the documents in evidence.
He contended that Exhibit D3 was admissible under Section 82(2)(a) of the Evidence Act, 2011, as the maker’s attendance could be dispensed with to avoid undue delay or expense, particularly since the document merely explained the contents of Exhibit D5.
He argued that Exhibit D5, being part of the Appellant’s business records, could be tendered by any officer of the bank pursuant to Sections 41 and 51 of the Evidence Act, 2011, relying on Jubril v. FRN (2018) LPELR-43993 (CA).
The Appellant further posited that Exhibit D5, being a certified public document, did not require the maker to tender it, relying on Section 105 of the Evidence Act, 2011, and Onochie & Ors v. Odogwu & Ors (2006) LPELR-2689 (SC).
He maintained that the document enjoyed the presumption of regularity under Sections 146 and 168 of the Evidence Act, 2011, relying on Okelola v. Adeleke (2004) LPELR-2438 (SC).
Accordingly, he urged that Exhibits D3 and D5 be admitted and properly evaluated as evidence that the Appellant had remitted the Respondents’ funds to the Central Bank of Nigeria and that promissory notes had been issued to their foreign business partners.
The Respondents, on their part, submitted on issue one that their cause of action accrued in 2005, when they received confirmation from the Central Bank of Nigeria (CBN) that the Appellant had failed to remit the Naira equivalent of US$217,381.05 deducted from the 2nd Respondent’s account.
They submitted that, before receiving the CBN’s letter, they could not ascertain who was responsible for the missing funds, as the Appellant had repeatedly informed them that the matter was under investigation.
They contended that the 1st Respondent did not admit that the Appellant had failed to remit the funds in 1983 or 1985 but maintained that the Appellant’s responsibility was confirmed only in 2005.
Counsel further argued that Union Bank of Nigeria Plc v. Umeodeagu (supra) was applicable to the circumstances of the case and urged the Supreme Court to hold that the action commenced in 2008 was not statute-barred.
The Respondents further submitted that a banker-customer relationship existed between the parties and that the sum of US$217,381.05 constituted a debt repayable by the Appellant upon demand, relying on Sani Abacha Foundation v. UBA (2010) 41 NSCQR 360.
They argued that the Respondents formally demanded repayment in 2005, but the Appellant continued to seek time to resolve the matter, necessitating the commencement of the action in 2008. Accordingly, they maintained that the Respondents’ claim for recovery of the debt was not statute-barred.
On issue two, the Respondents argued that the Appellant adduced no documentary or oral evidence to establish that it remitted the funds deducted from the 2nd Respondent’s account to the Central Bank of Nigeria (CBN) for payment to the Respondents’ foreign business partners.
They submitted that Exhibit D3 was admitted in evidence but rightly accorded no probative value because it constituted hearsay, as DW1, who tendered it, was neither a staff member of the CBN nor the Debt Management Office and could not establish the truth of its contents.
The Respondents also argued that Exhibit D3 was produced during the pendency of the suit, contrary to Section 83(3) and (4) of the Evidence Act.
Court’s Judgment and Rationale
Deciding issue one, the Supreme Court held that a cause of action accrues when all the material facts necessary to establish the Claimant’s right to sue have occurred and there is a competent party against whom the action may be brought.
In contractual disputes, the cause of action arises when the breach occurs and the Claimant becomes entitled to seek judicial relief. See Egbe v. Adefarasin (No. 2) (1987) 1 NWLR (Pt. 47) 1; Savannah Bank (Nig.) Ltd. v. Pan Atlantic Shipping & Transport Agencies Ltd (1987) 1 NWLR (Pt. 49) 212.
The Supreme Court reiterated that the starting point for determining whether an action is statute-barred is the Claimant’s originating process, particularly the Writ of Summons and Statement of Claim.
The court must identify when the cause of action arose and compare that date with the date the action commenced. If the action was instituted outside the applicable statutory limitation period, it is statute-barred. See Araka v. Ejeagwu (2000) 15 NWLR (Pt. 692) 684.
On the applicable limitation period, Their Lordships held that Section 8(1)(a) of the Limitation Law of Lagos State provides that an action founded on a simple contract must be brought within six years from the date the cause of action accrued.
His Lordship, Garba, JSC, further explained that limitation laws serve the public interest in bringing litigation to an end, based on the principle of interest rei publicae ut sit finis litium.
On the facts of the appeal, the Supreme Court pointed out that the Respondents’ pleadings and evidence admitted the following material facts, which revealed that the Respondents discovered the non-remittance in 1983, while the CBN confirmed it in 1987.
Despite contacting the Appellant, they produced no documentary correspondence between 1983 and 1987 and only renewed their demand in 2004 and 2005.
The law is that, in considering whether an action is statute-barred, negotiations between parties do not prevent or stop the time limited for filing an action from running.
Even where there is an exchange of correspondence and negotiations are ongoing between parties, time does not stop running from the date the cause of action accrued. See A.G. Adamawa State v. A.G. Federation (2014) 14 NWLR (Pt. 1428) 515; Aba v. Board of Directors, NIPOST (2023) 5 NWLR (Pt. 1878) 475.
The court further reasoned that once the Respondents discovered that the Appellant had failed to remit the money and they had to make alternative arrangements to pay their overseas associates, all the material facts necessary to institute an action were present.
Accordingly, the court rejected the contention that the cause of action arose in 2005, holding instead that it arose in 1983, when their overseas associates reported non-payment, or, at the latest, in 1987, when the CBN issued its circular confirming that the money had not been remitted.
Thus, since the Respondents commenced the action on 20th August, 2008, the court held that the action was instituted outside the six-year limitation period prescribed under Section 8(1)(a) of the Limitation Law of Lagos State.
Having been commenced outside the prescribed limitation period, the suit was incompetent, as the Respondents’ right to enforce the cause of action through judicial proceedings had been extinguished by operation of law.
Consequently, the court lacked jurisdiction to entertain the action, in line with the decision in NPA Plc v. Lotus Plastics Ltd (2005) 19 NWLR (Pt. 959) 158.
Regarding issue two, the court noted that Exhibit D3 was a letter issued by the Debt Management Office (DMO), signed by Hannatu Suleiman and addressed to the Appellant.
Exhibit D5 comprised certified copies of transaction sheets relating to the CBN’s trade refinancing exercise of 1984–1988, attached to Exhibit D3.
Both exhibits were tendered through DW1 to establish that the Appellant had remitted the sums deducted from the Respondents’ account to the CBN and that promissory notes had been issued to the Respondents’ foreign business partner.
However, the maker of Exhibit D3 was not called as a witness.
Accordingly, the court held that the exhibits qualified as hearsay evidence and were, therefore, inadmissible and lacked probative value under Sections 37 and 38 of the Evidence Act. See Buhari v. Obasanjo (2005) 13 NWLR (Pt. 941) 1.
The rationale was that, as a general rule, a document should be tendered by its maker, who can authenticate its contents and be cross-examined on them.
The court further held that the exceptions to the rule against hearsay under Section 39 of the Evidence Act had not been established.
There was no evidence that Hannatu Suleiman was dead, could not be found, was incapable of giving evidence, or that calling her would occasion undue delay or expense.
The court noted that DW1 could tender Exhibits D3 and D5 only to establish that the documents or statements existed, not to prove the truth of their contents.
Having held that the Respondents’ action was statute-barred under Section 8(1)(a) of the Limitation Law of Lagos State and that their right of action had been permanently extinguished and could not be revived through subsequent legal proceedings, the court ordered the dismissal of the Respondents’ action, relying on Drexel Energy and Natural Resources Ltd v. Trans International Bank Ltd (2008) 18 NWLR (Pt. 1119) 388.
Appeal Allowed.
Representation
Dr Kolawole Mayomi and David Andy Essien for the Appellant.
Chief Umeh Kalu, SAN, with Chibuike Chima and others for the Respondents.
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