Why the Court of Appeal Decision in Moses v. Ecobank & Anor does not open the flood gates for actions on failed ATM transactions

By Oliver Omoredia

In the past days, significant attention has been given to the decision of the Court of Appeal in the case of Moses Jwan v. ECOBANK Nigeria Plc & Anor [2021]10 NWLR pt.449. Much of the attention on the case has been drawn from the obiter dictum per Aliyu JCA on the point that ” The ATM card issued by a bank being akin to a cheque, must be honoured on request once there is enough funds in the customer’s account, and failure to do that means the bank is in breach of the duty of care owed to its customer”. Unsurprisingly, that statement in the judgement has been circulated as judicial authority on the point that bank customers can sue Banks when they encounter frustrations in the use of ATMs. This write-up however considers that inference to be a stretch of the very narrow authority that is established in the case of Moses Jwan v. ECOBANK & Anor. The write-up considers the true basis for the decision in the case, why the Banks were held liable and the mitigating steps which commercial banks can take to avoid opening the flood gates of litigations in light of the above authority.

FACTS OF THE CASE

The Appellant was the customer of Ecobank (the 1st respondent) who issued him with an ATM card. He used the ATM card in the ATM of UBA (the 2nd Respondent) to withdraw the sum of N10,000. The machine continuously made the sound of counting money notes then showed that the transaction was successful, but he did not get any money from the machine even though was debited the amount with the bank charges.

He complained to the officers of Ecobank and UBA but it did not yield any positive result. Ecobank insisted that its record showed that he was paid the money by the ATM. He therefore commenced an action claiming the sum of N10,000, special damages of N100,020 and general damages of N500,000.

The Appellant claimed that the events could not have occurred without negligence on the part of the Respondents and he therefore pleaded Res Ipsa Loquitur (that the facts speak for themselves).

The trial Court decided against the Appellant on the basis that he failed to establish that the Respondents were negligent. The Court also held that the Res Ipsa doctrine was not applicable.

Dissatisfied with the decision the Appellant appealed to the Court of Appeal.

ARGUMENT OF COUNSEL AT THE COURT OF APPEAL

In summary the Appellant’s Counsel argued that the Learned trial Judge was wrong when he admitted the photocopy of the 2nd respondent’s ATM journal which the Respondents claimed recorded the ATM transaction as successful, because the original of the journal was not produced and there was no proper foundation laid either in its pleadings or in the evidence for the court to admit the photocopy. He said the document failed to meet the requirements of Section 82 and 84 of the Evidence Act.

He further argued that while the onus of proof in civil cases is generally on the Plaintiff, Section 133(1) of the Evidence Act raises a presumption from the pleadings in favour of the Plaintiff and the Defendant has the task of discharging the initial burden of proof. He therefore argued that the event was something the Plaintiff could not explain and that was a situation which could not have happened in the ordinary course of things without some negligence from the Respondents. That was why he relied on the doctrine of res ipsa loquitur in his pleadings. Therefore, the Respondents had the duty to severally or jointly demonstrate by evidence that what occurred was an accident and not based on their negligence and that this should have been the starting point of the case.

Importantly, the Respondents did not produce the image captured by the ATM machine showing if the Appellant indeed took his money after the alleged successful transaction and the two Respondents’ witnesses admitted that it was possible for a customer’s account to be debited without the customer being paid. Therefore, evidence of debit was not evidence of a successful transaction.

The 1^st Respondent however argued that the appellant failed to prove that he was not paid the money from the ATM. They relied on the statement of account of the Appellant which showed that the Appellant was indeed paid and also relied on the Bank’s journal showing the success of the transaction. The 1^st Respondent contended that doctrine of res ipsa loquitur as a cause of action was not available to the Appellant who has failed to prove the material facts of his claims of negligence. The 2^nd Respondent also similarly argued that the Appellant had failed to plead and prove the particulars of negligence alleged.

Determination of the Appeal

On whether the Banker’s journal was inadmissible for lack of proper foundation for the admission of photocopy and the absence of certification as a computer-generated evidence, the Court disagreed with the Appellant and held that the document was admissible on the basis of its relevance. According to the Court “the trial Judge was right to be guided by relevancy of the document to the fact in issue, at the point of tendering the exhibit 19, especially in view of the testimony of the DW2 that he saw the original document from which exhibit 19 as a copy was made and in view of the provisions of section 89(h) and 90(e) of the Evidence Act. The fact in issue before the trial court was whether or not the appellant was paid the sum of N10,000 he requested from the ATM of the 2nd respondent, and exhibit 19 is said to contain the record of that transaction. It was therefore relevant and admissible in evidence”.

However, while the Learned Justices of the Court of Appeal held that the document was admissible, they however held that the trial court ought not to have attached much probative value to the exhibit because it was faded and could not be easily read. According to the Court:

“DW2 clearly testified that exhibit 19 is “faded away”. When something is said to have faded away, it cannot be seen, because the ordinary dictionary meaning of ‘faded’ is disappeared. It is therefore a mystery how the same witness who said the exhibit he was tendering had faded away could still “read” the document contrary to his claim. It is not logical to read a document that has faded away, even if one has microscopic eyes, which no human possesses.

Regrettably, the learned trial Judge did not consider this crucial piece of evidence regarding the legibility of exhibit 19, which was clearly stated by the witness through whom it was admitted in evidence. It is my view that a document that has faded away, cannot be ascribed any probative value. It is worthless piece of paper and it is hereby expunged from the record of appeal”

Opinion

With due respect to the Learned Justices of the Court of Appeal, it is difficult to see how Exhibit 19 was held by the Court to have been properly admitted, but expunged because the trial court gave significant probative value to the said evidence. One would expect that it is evidence which is found to have been inadmissible and improperly admitted by the trial court that should be expunged from the records of court. See. ORISA v. STATE (2018) LPELR-43896(SC) and MAGAJI v. OGELE (2012) LPELR-9476(CA). Hence, the Learned Justices of the Court of Appeal could have determined that the Exhibit could not attract significant probative value, without expunging same from the record. It is trite that worthless documents cannot have any important influence on the result of a case. See: Kraus Bright-v. Ordani (supra): Onochie v. Odogwu (supra) at page 65.” Per ABDU ABOKI, JCA (Pp 27 – 27 Paras E – F) See also UNITY BANK PLC v. IDEMUDIA (2016) LPELR-40823(CA).

On whether the doctrine of Res Ipsa Loquitur was applicable, the Court held that the Appellant was entitled to plead Res Ipsa Loquitur. According to the Court:

The testimony of the DW1 showed that the 1st respondent did not doubt the complaint of the Appellant, since there were times that such occurrences occur. It is also apparent that the only investigation it carried out or relied upon is the statement of account of the appellant (exhibit 18) that recorded the transaction as successful. However as posited by the learned appellant’s counsel and I totally agree with him, the recording of the transaction as successful by both the ATM and his bank account was not in issue before the trial court. What was in issue and indeed the complaint of the appellant both before the trial court and in this appeal was that his account was debited without the requested cash paid to him and he did not know how that could happen without the negligence of the respondents. Therefore, the 1st respondent’s reliance on the statement of account as its investigation to show that the transaction was successful was a non-starter.

What was required to discharge the presumption of negligence against the 1st respondent or its officers is an explanation of how that could have happened without its negligence or failure of duty of care owed to the appellant. This is especially so because its witness DW1 admitted that there are situations where the ATMs debit a customer’s account without paying him the cash requested, which was what the appellant complained of. Indeed, the evidence of the 1st respondent only supported and strengthened the case of the appellant of negligence against it. The effect of this is that the1st respondent did not rebut the presumption of negligence against it in this case.

The Court therefore found in favour of the Appellant and granted the reliefs sought.

CONCLUSION

As seen from the above, the Court did not find against the Respondent Banks because an ATM card is like a cheque which must be honoured when the account holder has sufficient credit. No! That was an obiter raised by the Learned Justice of the Court of Appeal.  The decision was more in line with social justice, which imputes a fiduciary responsibility on the bank towards its customers. Indeed, the Banks failed woefully in the lackluster treatment of the complaint of their customer, and it was that wrong that the Court sought to remedy!

Therefore, it is not every failed transaction that can be basis for claim of damages on the above authority. To come within this decision the following must be established:

1. The transaction must have failed without explanation. Hence, where an ATM machine shows an error message like “User or Switch inoperative” or other error messages, a claim cannot be brought in reliance on the above authority.
2. The transaction failure must have not been rectified within reasonable time. Hence, where the account is debited and the money is reversed within a few days, the above authority will not be basis for action.
3. The officers of the Bank must have not rendered reasonable explanation and remedy after a reasonable time.

On the part of the Banks, the authority is also incisive on the need to preserve evidence of transactions at ATM machines in order to verify claims of this nature. Image of the Customer taking his cash from the machine was all that was required to establish the claim of the Respondents. In totality, the case is a good authority which will doubtlessly help the Nigerian Banking System live up to a higher standard than what currently obtains.