The Court of Appeal sitting in Lagos has set aside a Lagos State High Court judgment, which held Zenith Bank liable to pay Real Integrated & Hospitality Limited N872,780,522.84 as advance payment guarantee.

A three-man panel of the court, led by Justice Muhammed Sirajo in Appeal No:CA/LAG/CV/262/2022 – Zenith Bank Plc v Real Integrated & Hospitality Limited and State Universal Basic Education Board (SUBEB) Gombe State, upturned the lower court decision of Justice O. O. Abike-Fadipe.



Justice Abike-Fadipe on March 8, 2022, held the bank in breach of contract because on October 7, 2011, it refused Real Integrated to draw from its Account No. 1012465427.



The court also directed the bank to pay interest of 15 per cent per annum on the N872,780,522.84 from May 17, 2011, when the advance payment guarantees expired till judgment and thereafter at the rate of 10 per cent per annum until final liquidation.



It further awarded N2,500,000 as cost of the action in favour of Real Integrated.



But Zenith Bank challenged the decision through its team of counsel led by Prof. Fabian Ajogwu, SAN and Mr Sylva Ogwemoh, SAN.



The bank sought an order setting aside the lower court decision on the ground that it acted in full compliance with its contractual obligations in line with the Advance Payment Guarantee (APG) contract and that the trial court was wrong.


Responding, the 1st Respondent, through its Counsel, E.O Jakpa, argued that the bank breached the contract while SUBEB Gombe State did not contest the Appeal.



The Court of Appeal, in a unanimous decision on November 23, agreed with the bank’s submission and resolved all the issues raised in its favour.



The appellate court set aside the judgment of Justice Abike-Fadipe and awarded a cost of N200,000 against Real Integrated & Hospitality Limited and in favour of the Zenith Bank.



The court based its decision on the ground that the trial court was wrong to have presumed that the bank withheld the full account statement of Real Integrated in the light of Exhibit C6 (the comprehensive Statement of Account of Real Integrated), which was tendered by the bank for a limited purpose, adding that there was no need for the lower court to have invoked Section 167 (d) of the Evidence Act, 2011 against the bank.


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