BY KENNETH EZE
Following a recent Court of Appeal ruling that the Automated Teller Machine card is equivalent to a cheque, lawyers and economic experts are of the opinion that the decision is weighty and portend industry-wide implications, which will lead to changes in the banking sector.
In the same vein, the Federal Competition and Consumer Protection Commission has expressed its willingness to assist aggrieved bank customers having challenges with the ATM, but may be constrained by resources.
An ATM is an electronic banking outlet that allows customers to complete basic transactions without the aid of a branch representative or teller.
A legal scholar, John Onwuzulike, in a chat with The Point, said, “As you’ve noticed, this is a judgment of court with appellate jurisdiction – so it has a very strong force of law – all things considered.”
On the likely impact on banking services going forward, he pointed out that the banks would be compelled to exercise more care in their operations, as to avoid fouling the law, which might incur costs and reputational damage.
“The issue of duty of care in law is a very serious one,” he said.
The scholar explained that the legal landscape was littered with various decisions that accorded the issue of care a pride of place in business transactions.
The plaintiff in the extant case was awarded general damages of N500,000 by the Appeal Court because his bank failed to pay him N10,000 through the ATM when he demanded it. The banks also failed to resolve the issue when he complained, so he approached the courts for relief.
“You also have noticed that the court awarded cost against the bank as general damages wrought upon the customer, owing to the bank’s negligence of its duty of care,” Onwuzulike observed.
The consensus of the opinions of people who spoke to The Point is that the decision of the Court of Appeal in Moses Jwan v. ECOBANK Nigeria Plc & Anor [2021]10 NWLR pt.449 is very likely to have an industry-wide impact on banking.
However, the coming days will tell if the banks would wake up to their responsibilities to the banking public, by addressing the flip-flop services that have come to characterise the ATM aspect of banking in Nigeria.
As things stand, many banking customers have tales of woe on ATM transactions. These range from issues like failure to dispense, even after their accounts have been debited, as was the case in the instant matter; service not available, issuer and/or switch inoperative and/or inoperable, temporarily unable to dispense cash, to service in progress messages, among other excuses.
The frequency of excuses, which is almost regular, connived to compel customers to consider them flimsy.
Onwuzulike lamented that the nasty customer experience with the banks had become so commonplace and an everyday experience, that many would heave sighs of relief over this decision of the Court of Appeal.
He said, “So, the matter is this same rampant experience every one of us has with the banks. Sometimes, one is compelled by the attendant circumstances and the banks’ negligence and lack of effective attention to their duties to their customers; to wait for over a week or two before anything can be done, leaving such customers, particularly in situations where they have no alternatives to raising funds, to suffer and starve, unable to meet the need for the funds.”
Observers expect the ruling to serve as a wake-up call for the banks for an improvement in this aspect, because the Court of Appeal has armed customers with this judgement, and some would be seeking to take advantage, while no bank would want to be at the receiving end.
“Bank customers may want to massively swoop into the reprieve thrown up by this court judgment to obtain redress from the ‘bullyings’ by the banks, which has done incalculable damages to bank customers,” the legal scholar warned.
The Head of Public Relations, Federal Competition and Consumer Protection Commission, Ondaje Ijagwu, agrees with Onwuzulike that there might be consumers with similar experiences as Jwan, who were likely to move to take advantage of the Appeal Court’s decision.
On the ruling, Ijagwu, who spoke to The Point on the telephone, said that the court would have decided the matter on merit. He opined that “the court, like any other institution, treats every case on its merit.”
Several people commended Jwan for the tenacity to pursue his case to the point of getting justice, because they reckoned that it would have required ample resources.
However, there is hope for those who might not possess such muscle, because the FCCPC can come to their rescue.
“We actually offer free redress to consumers on matters that they feel aggrieved about. They don’t need any legal representation or anything that might involve cost,” Ijagwu said.
He highlighted that bank customers who contemplated going this route had to bear in mind that the FCCPC would only attend to cases on merit.
“If a consumer has a complaint that he brings before us, we will look at the matter on its merit,” he explained.
Extant laws of the land empower the FCCPC to adjudicate on consumer issues to reduce the stress of aggrieved customers. “While discharging our responsibilities, the law actually mandates us to order compensation, where necessary,” Ijagwu noted.
This buttresses the point that not every complaint tabled before the FCCPC would require litigation to resolve. “There is a legislation that empowers us to provide relief to an aggrieved consumer,” the Agency added.
“observers are quick to point out that, given the facts of the matter and ruling, the whole banking system would have to sit up and address the issues raised, to avoid coming under the weapon handed to customers by the ruling”
What this portends is that people without much financial muscle or other resources for that matter, can receive the support of the Commission, should they feel aggrieved with banking services, ATM transactions or indeed other consumer related issues. And this, without prejudice to the decision of Aliyu JCA, in the matter involving Jwan and two banks.
Recall that on a matter brought before it by one Moses Jwan against two banks, Aliyu JCA, ruled, inter alia, that “The ATM card issued by a bank being akin to a cheque, must be honoured on request once there is enough funds in the customer’s account, and failure to do that means the bank is in breach of the duty of care owed to its customer.”
From the tempo and tone of conversations in the public space on the decision, the banking landscape in Nigeria appears headed for a form of revolution. Many consider the ruling of the Court of Appeal, defining and in favour of banking customers.
From the level of excitement, it is evident that the public is claiming the victory, not just the appellant, in the instant case, Jwan, who sought reliefs against his bank and another bank for failure of an ATM transaction.
The landmark ruling is perceived in several quarters to have weaponised the tiny card issued by banks to their customers, which many had, hitherto taken for granted.
The Judge’s decision has woken many up to the fact that with the ATM, there is a binding contract with the bank or banks, as evidenced by the case under consideration.
There were two banks involved in the matter. Ecobank issued the card, while UBA deployed the machine on which the subject transaction was carried out and they were 1st and 2nd respondents on the matter adjudicated by the Court of Appeal.
The two banks involved in the matter might not necessarily have been jolted by the costs awarded against them. However, observers are quick to point out that, given the facts of the matter and ruling, the whole banking system would have to sit up and address the issues raised, to avoid coming under the weapon handed to customers by the ruling.
The perception among the banking public is based on the fact that banking is about the most regulated segment of business, where every aspect, including deposit and withdrawal of fund, is subject to legal provisions, judicial pronouncements or both.
