Appeal Court Upholds N2 . 5 b Judgment Against Skye Bank

Appeal Court Upholds N2 . 5 b Judgment Against Skye Bank

The Court of Appeal sitting in Akure on Tuesday upheld the judgment of an
Osun State High Court which awarded N2. 5 billion damages against Skye
Bank Nigeria Plc for breach of contract against a customer of the bank,
Tuns Farm Nigeria Plc .
Tuns Farm , which is owned by the Asiwaju Musulimi of Yorubaland , Alhaji
Tunde Badmus , has been having running battle with Skye Bank over breach
of contract on a loan facility .
However , the Appeal Court, in a unanimous judgment delivered by Justice
Denton West , allowed the appeal and upheld the lower court judgment which
was delivered in March 2014 by Justice Oyejide Falola .
The three member panel of justices of the appellate court , while dismissing
the appeal filed by Skye Bank , held that the lower court had the right to
award both special and general damages to the appellant ( Tuns Farm ) for
breach of contract .
Justice Falola of the High Court , had specifically ruled that Skye Bank erred
in law by the non -fulfillment of contractual agreement entered into on a loan
facility of N 2 billion with Tuns Farm .
Justice Falola had also ruled that the bank exhibited poor corporate
governance and poor diligence in handling the Central Bank of Nigeria ( CBN)
loan which was paid into the account of Skye Bank for disbursement to Tuns
Farm .
According to the matter , Tuns Farm had dragged Skye Bank before Justice
Falola for disbursing the mere sum of N 300 million out of the N2 billion loan
it secured from CBN under a special loan facility called Commercial Agric
Credit Scheme.
According to the plaintiff ( Tuns Farm ) , efforts made to the bank for the
release of the balance of N1. 7 billion did not yield any positive result , as the
bank insisted that it had used the balance to offset a loan previously
obtained by the farm .
Dissatisfied with the judgment of the High Court , Skye Bank had approached
the Appeal Court and argued that the previous loan had been taken over by
the Asset Management Company of Nigeria ( AMCON ) .
However , the Court of Appeal , on Tuesday dismissed the appeal for lack of
merit and ordered the bank to pay the damages as ordered by the lower
court .
Justice West held that “ banks should maintain the economic buoyancy of
Nigeria and beneficiaries of credit facilities should use the facility for the
benefit of the nation to reduce the level of unemployment in the country . ”