Wednesday 13 May 2015

Appeal Court Awards N2.5bn Damages Against Skye Bank For Breach Of Contract

The Federal Court of Appeal sitting in Akure, Ondo State has awarded the sum of N2.5billion as damages against Skye Bank Nigeria Plc for breach of contract against Tuns Farm Nigeria Plc, Osogbo.

In a judgement delivered yesterday, Justice Denton West upheld the earlier judgement of an Osun State High Court sitting in Osogbo which had in March last year ordered Skye Bank Nigeria Plc to pay N2.5billion as damages to the farm.

The three-member panel of judges, while dismissing the appeal filed by the Skye Bank Nigeria Plc, also unanimously averred that the lower court had the right to award both special and general damages to the appellant for breach of contract.


The Tuns Farm Nigeria Limited had dragged an Osogbo branch of the Skye Bank Plc before the court for disbursing the sum of N300million out of the N2billion loan it secured from CBN under a special loan facility called Commercial Agric Credit Scheme.

According to the plaintiff, efforts made for the release of the balance of N1.7billion by the bank did not yield any positive result as the bank held that it had used the balance to offset a loan previously obtained by the farm.

An Osogbo High Court had last year ruled that the Skye Bank Nigeria Plc erred in law by the non-fulfilment of contractual agreement entered into on a loan facility of N2billion with the farm.

In his judgement, Justice Oyejide Falola ruled that the bank exhibited poor corporate governance and poor diligence in handling the Central Bank of Nigeria (CBN) loan which was paid into the account of Skye Bank Plc for disbursement to the bank customer.

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