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Relationship between tort of defamation and injurious falsehood

On or about April 2, 2013, the 1st respondent, a capital market financial institution applied to the 3rd respondent for a term loan of N250 Million to enable to it purchase a prime property at Lekki Phase I, Lagos...

[FILES] Scale of justice

CITATION: (2021) LPELR-55610 (CA)

In the Court of Appeal
In the Lagos Judicial Division
Holden at Lagos
Suit No: CA/L/1093/2017
Before Their Lordships:
OBANDE FESTUS OGBUINYA                                    Justice, Court of Appeal
FATIMA OMORO AKINBAMI                                     Justice, Court of Appeal
FREDERICK OZIAKPONO OHO   Justice, Court of Appeal                                                                    
STANBIC IBTC BANK PLC                                                – Appellant(s)
2. CRC CREDIT BUREAU LIMITED                                  – Respondent(s)
3. UNION BANK OF NIGERIA PLC                                             
On or about April 2, 2013, the 1st respondent, a capital market financial institution applied to the 3rd respondent for a term loan of N250 Million to enable to it purchase a prime property at Lekki Phase I, Lagos. The 3rd respondent, in strict compliance with the Central Bank of Nigeria directive, conducted credit status checks, with the relevant bureaus, on the credit worthiness of the 1st respondent. On April 23, 2013, the 3rd respondent wrote to the 1st respondent informing it of its inability to grant the term loan due to the unfavourable credit report made against it by the 2nd respondent, a credit information bureau, which was electronically published in its data bank to the whole world including the 3rd respondent. The 3rd respondent further informed the 1st respondent that the appellant had reported to the 2nd respondent that the 1st respondent had unsecured overdraft facility. The 1st respondent viewed the Credit Status Report (CSC) as false and malicious. Hence, the 1st Respondent commenced an action at the trial Court against the appellant and 2nd respondent jointly and severally alleging that the report constituted malicious falsehood that tarnished its reputation, injured its business and caused it pecuniary losses.       
Subsequently, the 2nd respondent commenced third party proceedings against the 3rd respondent on the ground that there was non-disclosure agreement between them in respect of the CSR of the 1st respondent.
   At the conclusion of trial, the trial Court granted the 1st respondent’s claim and dismissed the third-party notice.
   Thus, the Appellant appealed to the Court of Appeal.

The appeal was determined on the following issues:1. Whether the lower court was right in holding that the 1st respondent’s action as constituted in the Writ of Summons and Statement of Claim is for injurious falsehood (especially having regard to the court’s ruling of 18.09.14 that the 1st respondent’s case was predicated on injurious falsehood and/or defamation).
2. Whether the lower court was right in allowing the 1st Respondent to leapfrog and violate the legal prescription of the provisions of Exhibit N, which spell out mandatory regulatory grievance resolution mechanism prior to Court action.
3. Whether the lower court was right in failing to expunge Exhibit L2 from its record on the basis that it was functus officio on the issue of admissibility of Exhibit L2 when in fact it was admitted in contravention of Section 84 of the Evidence Act.
4. Whether the lower court was right in holding that Exhibit L2 was published to the whole world by the appellant notwithstanding that access to the secure data base from which the 3rd respondent printed Exhibit L2 was granted by the 2nd respondent on the instruction of the 1st respondent coupled with the incontrovertible evidence that the 3rd respondent thereafter released it directly and specifically to the 1st respondent only vide Exhibit L.
5. Whether the lower court was right in holding that the 1st respondent proved a case of injurious falsehood against the Appellant having regard to lack of evidential proof of the essential elements of the tort of injurious falsehood.
6. Whether the lower court was right in holding that the defences of justification and qualified privilege do not avail the appellant.
7. Whether the lower court was not in error when it held that Exhibit L2 (the credit status report), was connected to Exhibit D (the 1st respondent’s loan application), and on that basis affirmed the 1st respondent’s case when in fact Exhibit L2 predated Exhibit D.
8. Whether the lower court was right in holding that this case and the case embodied in Exhibit G were unrelated although both cases related to the same bank account and credit facilities.
9. Whether, by deciding to discountenance the Final Written Address of the appellant, and embellishing the case of the 1st respondent, the lower court denied the appellant fair hearing.
10. Whether having regards to the state of pleadings and the evidence before the lower court, the award of N50 billion general damages and N500,000 cost is justified.
11. Whether the lower court ought not to have struck out the Written Statement on Oath of CW1 dated 16.05.13 on the ground of its non-compliance with the mandatory requirement of the Oaths Law of Lagos State.

On issue 1, appellant’s counsel argued that based on the pleading, the 1st respondent’s cause of action was in defamation not injurious falsehood. That the reliefs granted had no bearing with the cause of action. He cited SALUBI V. NWARIAKU (2003) LPELR – 2998 (SC).
Counsel for the 1st respondent submitted that the statement of claim showed the elements of injurious falsehood.
On issue two, Appellant’s counsel submitted that failure of the 1st respondent to comply with SECTION 6.8 OF THE GUIDELINES FOR THE LICENSING OPERATION AND REGULATION OF CREDIT BUREAUS IN NIGERIA (THE GUIDELINES) (Exhibit N) renders the action incompetent as it is a failure to fulfill a condition precedent and which in turn has affected the lower court from having jurisdiction to hear the action.

1st respondent’ counsel argued that THE GUIDELINE was not binding on it. He posited that SECTION 6.8 OF THE GUIDELINES is not a condition precedent and it cannot be imputed into it. He relied on IKEMEFUNA V. ILONDIOR (2018) LPELR-44840 (CA).
   On issue 3, Appellant’s counsel contended that Exhibit L2 (the credit status report) was a computer-generated document which did not comply with SECTION 84(2) AND (4) OF THE EVIDENCE ACT, 2011 which made it inadmissible. That a Court has a duty to expunge wrongly admitted inadmissible evidence.
1st respondent’s counsel however stated that Exhibit L2 is admissible under certain conditions. That it was used by the appellant and so same cannot complain on its admissibility. He relied on Kassim v. State (2017) LPELR-42586 (SC).

On issue 4, appellant’s counsel submitted that the appellant did not publish Exhibit L2. That until the electronic information supplied to the data base of the 2nd respondent is read by a human being, then there is no publication.
   Counsel to the 1st respondent argued that the appellant did not obtain the consent of the 1st respondent to publish Exhibit L2 as required by Sections 2.4, 2.5 and 2.8 of Exhibit N.
   On issues 5 and 6, Counsel submitted that the elements of injurious falsehood as stated in NEWBREED ORGANISATION LTD. V. ERHOMOSELE (2006) 4 SCM 87 were not proved by the 1st respondent.
  1st respondent’s Counsel argued that malice was proved. He stated that the Appellant had a duty to obey Exhibit G.
  On issue 7, appellant’s counsel contended that there was no connection between Exhibit D (the 1st respondent’s loan application), dated 2nd April, 2013, and Exhibit L2, dated December 4, 2012, upon which the action was based, because of no logical sequence in their dates.
Counsel to the 1st respondent argued that whether or not Exhibit L2 was made on December 4, 2012 or April, 2013 did not matter. That what mattered was that the 1st respondent’s credit information published by the appellant on October 31, 2012 was injurious falsehood against it.
On issues 8 and 9, appellant’s counsel posited that the lower court ought to have adjourned the instant case pending the appeal of Exhibit G in the Supreme court.
   He asserted that the lower Court’s discountenance of the Appellant’s final written address denied it of its right to fair hearing, occasioned a miscarriage of justice, violated some principles of law or procedure and rendered the judgment perverse and a nullity. He relied on SECTION 36(1) OF THE CONSTITUTION, 1999 AS AMENDED.
   1st respondent’s counsel was of the opinion that the instant case could be determined without waiting for the future outcome of the appeal before the Supreme court.
  He posited that the Appellant’s complaint of denial of fair hearing was not valid. That no miscarriage of justice was suffered by the Appellant as address of counsel is meant to assist the Court and cannot substitute pleadings and evidence.
On issues 10 and 11, counsel contended that the 1st Respondent failed to plead and prove actual or special damages as required by law. He stated that the award was excessive.
   Counsel submitted that the lower Court wrongly failed to strike out CW1’s Written Statement on Oaths, which has no mandatory statutory declaration contrary to SECTION 11 OF THE OATHS LAW OF LAGOS STATE (OATHS LAW) AND SECTION 13 OF THE OATHS ACT.
   1st respondent’s counsel submitted that award cannot be set aside because it is excessive considering inflation and depreciation of currency.
  He argued that the Written Statement on Oath was competent because it contained statements of attestation and verification. That same was in substantial compliance with the law. He cited SECTION 13 OF THE OATHS ACT AND SECTION 11 OF

On issue 1, the Court stated that the statement of claim of the 1st respondent contains critical averments of injurious/malicious falsehood. The court thus held that the 1st respondent’s cause of action is one that resides within the lean perimeter of injurious/malicious falsehood (trade libel), which the case law has properly propagated, in the wide sphere of tort of defamation.

The court on issue 2, explained that the apex Court has decreed that a guideline or policy statement is not law, see STANTOIL (NIG.) LTD. V. INDUEON (NIG.) LTD. (2021) 7 NWLR (PT. 1774) 1. The court then stated that the provision of THE GUIDELINES is impotent to affect the 1st Respondent’s action pending its satisfaction of it.
The Court thus held that the 1st respondent’s action was not caught in the intractable web of the doctrine of exhaustion of local remedy in an enactment.
On issue 3, as to the contention of the appellant that Exhibit L2 flouted the mandatory provision of SECTION 84(4) OF THE EVIDENCE ACT, the Court relying of the words of HON. JUSTICE ALABA OMOLAYE-AJILEYE in his pioneer book: ELECTRONIC EVIDENCE, REVISED EDITION (LOKOJA, JURIST PUBLICATION SERIES 2019) AT PAGE 262 wherein the author propounded thus: “The point had earlier been made in the previous chapter that the scope of the applicability of SECTION 84(4) should be limited to a proponent whose computer device produced the electronic document. In other words, production of a certificate as an essential element of process of authentication should be made mandatory where a proponent is in control of the device that produced the document. It is, therefore, suggested that the law should not be too strict on a party whose computer did not produce the electronic document and it becomes impossible for him to produce same. This should be treated as an exception to SECTION 84 (4), in the interest of justice. This is because, it will amount to a denial of justice if an authentic document is kept out of the consideration of the court by reason of the fact that a certificate is not produced by a party who cannot possibly secure its production. In this technological age, nothing more unjust can be conceived!” held that the lower Court was right in law when it admitted Exhibit L2 as an exhibit.
On issues 4, 5, 6 and 8, the court held that these issues are intertwined as they are against the lower court’s evaluation of the evidence. The court held that the lower court carried out a meticulous and thorough analyses of the evidence, viva voce and documentary, proffered by the warring parties after assigning them to their respective pans in the imaginary scale of justice.
The court in resolving issue 9, quoted some extract of the lower court’s judgment to show that the trial Court created the egalitarian and congenial atmosphere for the Appellant to deliver its final written address. The court held that the lower court was thus not guilty of the charge of violation of its right to fair hearing levelled against it.
On issue 10, the Court held that in absence of evidence by the 1st respondent, the lower court imported extraneous matters in the appraisal of the damages and, by extension, into its judgment, which soiled it partly. That such act constituted a failure of justice, which, in turn, inflicted miscarriage of justice on the appellant.
On issue 11, the Court cited the case of BUHARI V. INEC (2008) 19 NWLR (PT. 1120) 246 AT 377 AND 378 held that the oath of the CW1, which is sought to be expelled, is not plagued by any negative elements as to drain it of its validity and admissibility.
The court opined that the provision of SECTION 4(2) (C) OF THE OATHS LAW OF LAGOS STATE neutralizes the mandatoriness of the provision of SECTION 11 OF THE OATHS LAW. That the CW1’s oath will be salvaged under the saving shelter of SECTION 4(2) (C) OF THE OATHS LAW.

The appeal was allowed in part as issues 1-9 and 11 were resolved against the appellant while issue 10 was partly in its favour. Accordingly, the Court reduced the sum of N50 Billion, awarded by the lower Court, to the sum of N5 Billion, as general damages in favour of the 1st respondent against the Appellant and the 2nd Respondent jointly and severally.
O. Ajayi, SAN, with him,
O. Opasanya, SAN and A. Aderogba, Esq.                                       – For Appellant(s)
Chief F. O. Fagbohungbe, SAN.,  
with him, Abayomi Adeniran, Esq.     – For 1st Respondent 
Yusuf Ali, SAN, with him,
Yakubu Dauda, Esq.                            – For 2nd Respondent(s)
Adesoji Ojerinde, Esq.                           – For 3rd Respondent
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