NEGLIGENCE - LOSS OF MONEY LOST IN THE BANK PREMISES BY CUSTOMER - LIABILITY?

LOSS OF MONEY/PROPERTY  BY CUSTOMER WITHIN THE BANK PREMISES – A LEGAL DISCOURSE

INTRODUCTION:

This matter bothers on Negligence in banking business. Negligence according to Black’s Law Dictionary, 6^th edition defines Negligence as “the omission to do something which a reasonable man, guided by those ordinary considerations which ordinarily regulate human affairs, would do, or the doing of something which a reasonable and prudent man would not do …. Conduct which falls below the standard established by law for the protection of others against unreasonable risk of harm; it is a departure from the conduct expectable of a reasonably prudent person under like circumstances”. U.S v. Ohio Barge Lines; Donoghue v. Stevenson(1932) AC 562 at 581.

Banking business has been defined in section 61 of Banks and other Financial Institutions Decree No. 25 of 1991 as “ … the business of receiving deposits on current account, savings account or other similar account, paying or collecting cheques, drawn by or paid in by customers; provision of finance or such other business as the Governor may, by order published in the Gazette, designate as banking business” if an action is brought against the bank on negligence, that presupposes that the action is brought on the ground that the bank has breached a duty of care it owes to the customer/plaintiff.

INGREDIENTS OF NEGLIGENCE:

Before liability to pay damages for the tort of negligence can be established, three things have to be proved by the plaintiff:

• That the defendant owes the plaintiff a duty of care
• That the defendant had breached the duty of care owed the plaintiff
• That the defendant’s breach of the duty of care was the cause of the injury in the proper sense of that term.

FACTS OF THE MATTER:

For a good appreciation of this topic, I would want to use an incident that took place in one of our branches as a case study. From the investigations conducted by the Inspectorate Department and the report from our Legal Officer in that Region, we gathered as follows:

• Mr. Chicken has been a customer of the branch of our bank since July 2001 and maintains among others a current account.
• Mr. Chicken was at the branch on the 22^nd of February, 2010 to make a deposit of N1,000,000.00 .
• In the process of filling his teller, he handed the cash to a man he assumed to be a staff at the place where he was filling the teller form who eventually escaped with his money.

DUTY OF CARE:

In the tort of negligence, a duty of care has its origin in the concept of foreseeability. Whenever a person is by circumstances placed in such a position with regard to another that everyone of ordinary sense who did think would at once recognize that if he did not use ordinary care and skill in his own conduct with regard to those circumstances he would cause danger of injury to the person or property of the other, a duty arises to use ordinary care and skill to avoid such danger. This shows that the bank as an artificial person, owes a duty of care to person (s) who come into contact with it for banking business. This duty of care involves provision of logistics and proper security to avoid putting person(s) who come into the bank in the way of harm.

BREACH OF DUTY OF CARE AND CONSEQUENT INJURY THEREUPON:

The question in this matter is whether there has been a breach of the duty of care owed the customer in this instance. The answer is No. The facts as gathered from the investigations of the Inspectorate and the admissions of the customer to our Port Harcourt Regional Legal officer the bank  show that the customer gave the said sum to a person who had given him a deposit teller, whom he mistakenly assumed to be a staff. He admitted that the man in question was not in the cubicle where the cashiers/tellers stay, morestill that the man was not formally dressed and neither was he wearing any of our identity card or lapel. Furthermore, the customer has been a customer of the bank since 2001 and definitely knows the procedure for making deposits. These are some of the security devices put in place by the bank to provide the duty of care for people coming into contact with the bank. The mere fact that the thief gave him the deposit teller and also made away with the money while still in the bank premises is not conclusive of a breach of the duty of care. In the case of Balmoral Supermarket Ltd v. Bank of New Zealand (1974) 2 LLOYDS REP 164, where armed robbers swooped on the cash of the plaintiff while it was at the counter about to be handed over to the cashier for counting. The court held that since title in the case had not passed to the bank, the bank was not liable.

In a more indigenous case of Salawu v. Union Bank of Nigeria Ltd (1986) 4 NWLR (part 38) 701, where the plaintiff went to his bank to pay N7,000.00, a senior official of the bank offered to help him make the payment as the queue was long. The plaintiff handed the money to him and went home. The money was never credited to the plaintiff’s account. In an action to recover the money, the court held that since the official was not a cashier or manager of the bank that the bank was not liable for his act which was outside his authority. The Bank’s staff was held by the court in this instance to be the plaintiff’s agent and not that of the bank.

The customer’s injury in this matter cannot either remotely or proximately be linked to the bank. He is an old customer of the bank and knows the procedure and where to lodge money for payment into his account. The customer earlier had admitted to the police and to our legal officer that he acted on a mistaken assumption that the person that gave him the deposit teller whom he gave his money was a staff. Assuming but not conceding that assumption, he was also negligent in making sure that his teller was controlled by the cashier (accepted and stamped by the cashier) as evidence of the consummation of the transaction. On the strength of the case of Salawu v. Union Bank of Nigeria Ltd, it is evident that the man Mr. Chicken gave his money was merely his agent and not that of the bank and as such the bank cannot be said to be liable for any breach whatsoever.

CONCLUSION:

From the legal principles and precedents as shown in this opinion, it is clearly evident that the customer is only looking for an escape route and wants to place it on the bank. The facts have shown that the issue of strict liability nor negligence cannot stand in this matter. The bank is fully not liable to the customer in fact and in law.

This should be an eye-opener to those of us who are most often than not guided under the mistaken belief that once one is in the Bank premises, that the bank shall assume an omnibus liability of all losses suffered while in the premises of the bank. The Law and indeed the Court in the interpretation of the Law have narrowed the definition of the liabilities of the bank in most of these situations. The individual must exercise caution and care while in the premises of the bank.