In this case the plaintiff-bank claimed against the defendant Kwaku Atta Osam-Pinanko, the sum of £G501 18s. 1d., as balance of an amount due and owing on account of overdraft and interest. The defendant trades in the business name of Awisto (Missionary) Emporium. He counterclaimed for £G300 as amount due to be paid to him to complete the performance of a contract by the plaintiff-bank to grant him a loan of £G500. He further claimed £G200 damages for breach of the said contract.
A claim for damages for breach of contract is alternative to a claim for specific performance of the contract, therefore the two claims cannot be made together.
In their reply to the statement of defence, and their defence to the counterclaim, the plaintiff-company pleaded that the amount claimed by them is made up of a loan of £G200, and moneys paid on a bill of exchange on behalf of the defendant.
The plaintiffs led evidence to show that they gave the defendant a loan of £G200, and also paid on his behalf an amount of £G222 18s. 4d. due on a bill accepted by the defendant. They tendered a statement of account in evidence, exhibit B. That statement is unsatisfactory; it does not show the beginning of the account, and is not at all clear in material particulars. I consider it unsafe to base a judgment upon that statement. The only amounts, the payments of which were proved with satisfaction, are £G200 advanced to the defendant, and £G222 18s. 1d. paid on his behalf on the bill No. AB. 15/564376. But none of those two amounts appear on the statement of account, exhibit B.
The defendant questioned the authority of the bank to pay the amount of the bill, the said sum of £G222 18s 1d., on his behalf. In reply counsel for the plaintiff referred the court to the English Bills of Exchange Act, 1882, 45 & 46 Vict. C. 61, ss.17 and 54, and The Practice of Law of Banking by Shelden and Drovers, (8th ed.), page 571, where the said sections of the English Act are reproduced. But that Act, not being an Act of general application in force in England on the 24th July, 1874, was not applicable to Ghana in 1959, the date when the plaintiff-bank met the said bill. The statute applicable was the Bills of Exchange Ordinance, Cap. 195 (1951 Rev.) now repealed and replaced by the Bills of Exchange Act, 1961 (Act 55).
Section 54 of the said Bills of Exchange Ordinance, provided that:
"54. The acceptor of a bill by accepting it -
(1) Engages that he will pay it according to the tenor of his acceptance";
and section 61 thereof provided that:
"Any draft or order drawn whether within or without the Gold Coast upon a banker whether within or without the Gold Coast for a sum of money payable to order on demand or at some other time which shall, when presented for payment, purport to be endorsed by the person to whom the same shall be drawn payable, shall be a sufficient authority to such banker to pay the amount of such draft or order to the bearer thereof; and it shall not be incumbent on such banker to prove that such endorsement, or any subsequent endorsement, was made by or under the direction or authority of the person to whom the said draft or order was or is made payable either by the drawer or any endorser thereof."
The principle is summarised in Halsbury's Laws of England (3rd ed.) Vol. 2, page 203, para. 377 as follows:
"Where a customer accepts a bill payable at his bank, it constitutes an authority to the banker to pay it at the maturity, and if no funds are available, amounts to a request for an overdraft to the amount, but, in the absence of previous arrangement, the banker is under no obligation to pay the bill, even though he has sufficient funds in hand."
See also Kymer v. Laurie (1849) L.J. Q.B. 218, Robarts v. Tucker (1851) 16 Q.B. 560 at p.579 and Bank of England v. Vagliano Brothers (1891) A.C. 107 at p.157.
The bill of exchange, exhibit A was accepted by the defendant for payment by his bank, the plaintiff-bank. The plaintiff-bank are therefore legally justified in debiting the amount thereof to the account of the defendant on or after the due date appearing thereon, which was the 17th March, 1959, and that is particularly so in view of the previous arrangement which the defendant made with the plaintiff-bank for overdrafts to meet his imports.
Therefore the plaintiffs have proved that the defendant is indebted to them in the sum of £G422 18s. 1d and that they are lawfully entitled to that amount of money.
Now to the counterclaim. The defendant alleged that the plaintiff-bank agreed to give him a loan of £G500, but gave him only £G200, and failed to give him the balance of £G300. He operated the overdraft by cheques. There is no evidence that he issued any cheque for the balance of £G300 and that the same was dishonoured by the bank. It is true that in his letter, exhibit 4 dated the 7th May, 1959, he complained that the bank had failed to grant him the full overdraft facility of £G500, and had only allowed him £G200. But by that date, as earlier shown, the bank had already given him facility of over £G400, which together with interest thereon would approximate the full accommodation of £G500. In those circumstances, the defendant had what he contracted for, and he has no legitimate cause of complaint.
In the result, there will be judgment for the plaintiff-company against the defendant for £G422 18s. 1d. with interest thereon at the rate of five per cent per annum from March, 1959, to the date of this judgment. The defendant's counterclaim is dismissed, and judgment entered thereon for the plaintiffs. The plaintiffs will have their costs fixed at 25 guineas, inclusive.