MOROGORO STORES (1976) LTD v NATIONAL BANK OF COMMERCE 1985 TLR 49 (HC)

MOROGORO STORES (1976) LTD v NATIONAL BANK OF COMMERCE 1985 TLR 49 (HC)

Court High Court of Tanzania - Dar Es Salaam

Judge Kazimoto J

13 November, 1986

CIVIL CASE 98 OF 1984 E

Flynote

Banking - Banker-customer relationship - Plaintiff's employee sent to deposit cash -

Employee returns with a fake F pay-in-slip - Bank denied having received the

money - Whether a fake pay-in-slip evidences a deposit with the bank - Whether

bank is duty-bound to warn customers of fake stamps.

-Headnote

The plaintiff sent his employee to deposit Shs.31,200/= in his account with the

defendant at his Branch. The G employee returned with a pay-in-slip which bore

the defendant's rubber stamp. When the Bank statement was checked the above

amount was not credited in the plaintiff's account. The plaintiff sued the bank to

recover Shs. 31,200/= plus interest thereon. H

Held: (i) The pay-in-slip was not an authentic document and the money allegedly

deposited with the defendant was not in fact deposited;

(ii) the defendants cannot be held liable merely because there is no warning

to customers of fake stamps.

Case Information

Judgment for defendant. I

1985 TLR p50

Cases referred to:

1. Lewes Sanitary Steam Laundry Company (Ltd) v Barclay and Co. Ltd. [

1906 ] T.L.R. 737 A

2. The Kepitigalla Rubber Estates, Ltd. v The National Bank of India. Ltd

[1909] 2 K.B. 1010 B

R.C. Kesaria, for the plaintiff

Ngalo, for the defendant

Judgment

Kazimoto, J: The plaintiff, Morogoro Stores (1976) Ltd. has been a client of the C

defendant the National Bank of Commerce, City Drive Branch Dar es salaam since

1976. On 27th June, 1983 the plaintiff alleges, and the defendant denies, that he

deposited the sum of Shs. 31,200/= in his account with the D defendant. As the

defendant has denied having received the money the plaintiff now sues the defendant

to recover the said sum of Shs.31,200/= plus interest and costs.

At the hearing five issues were agreed and framed and in my view the case depends

on issue one which if established the rest will automatically follow. The issues are: E

(a) Did the plaintiff pay in his bank account Shs.31,200/= as shown in Exh.

A to the Plaint?

(b) Did the defendant fail to credit the plaintiff's account with the said

sum? F

(c) Has the defendant wrongfully converted the said money to his own use

and wrongfully deprived the plaintiff the use thereof?

(e) What reliefs are the parties entitled to?

Zainabu Noordin (PW.1) testified for the plaintiff. He is the General Manager of the

company. He told the court G that his company has been operating an account with

the defendant since 1/7/1976 and that one Shaban Mohamed was depositing the

money on behalf of the company. He stated that the said Shaban Mohamed had been

working for the plaintiff for about five years and that he (PW.1) had always given

Shaban Mohamed cash H to bank and that he would return with pay-in-slip to him.

He told the court that on 27/6/83 he gave Shs.31,200/= to Shaban Mohamed to bank

and he banked the money and then returned with pay-in-slip which I bore the

defendant's bank rubber stamp. He told the court that when he checked his bank

statement on 19/7/83 he found that the money was not credited in his account. He

said later Shaban Mohamed was arrested, and charged with theft by servant but was

1985 TLR p51

KAZIMOTO J

acquitted. He stated that he trusted Shaban Mohamed, that he has never failed to

deposit cash in his account A and that when he saw the pay-in-slip he understood

that the money was banked. When cross-examined by Mr. Rutagatina learned

defence counsel for the defendant PW.1 stated that he would not know if the bank

stamp was B real or fake. He denied having known code number of the defendant's

bank. He stated that the defendant bank has no code number and that all that he

knows is that there is a teller's number. He further stated that he would not know if

the money was deposited with the defendant or Shabani Mohamed had stolen it.

When re-examined he denied that he was given specimen stamps and that there is no

way of ascertaining the teller's C stamp.

Roman Peter Ndanzi (DW.1) an accountant with defendant informed the court that

he has been working with defendant since 1979 and that he knows the plaintiff as one

of their clients. He told the court when a customer banks money he fills a pay-in-slip

and presents it to the teller. The slip bears the bank's stamp, the initials of the D

teller, the teller's number and the code number of the bank. He denied that on 27th

June, 1983 the plaintiff deposited cash with the defendant. He told the court that the

defendant's Code number is no.2 and that annexure E A has only teller's numbers

and it does not have the defendant's code. He has produced a copy of pay-in-slip Exh.

D1 which he alleges to be authentic, and that annexure A to the plaint is a fake payin-

slip. When cross-examined by Mr. Kesaria the learned counsel for the plaintiff

DW.1 admitted that there is no warning to warn customers. He admitted that

annexure A has initials of the teller. He denied that the money was deposited. F He

further stated that he would not have credited the money without pay-in-slip. He

admitted that if the money is deposited interest would have been paid.

As indicated earlier on the case hinges on issue number one. If the hinges don't

withstand the weight they collapse. DW.1 denies that the money alleged to have

been deposited vide Annexure A was infact deposited as G it lacked the features

peculiar to the defendant's bank stamp. I have carefully examined annexure A and

compared it with Exh. D1. Exh. D1 is in respect of a deposit which the plaintiff made.

Whereas Exhibit D1 shows that the money was received by teller 2, annexure A to

the plaint does not show clearly the teller's H number. Again in Exhibit D1 there

are the following words "City Drive Br.2, D'Salaam (I have omitted the words

National Bank of Commerce). In Annexure A to the plaint there appears the

following words, as is relevant "City Drive Branch". It should be noted that in Exhibit

D1 the word "Branch" is abbreviated followed I immediately with the Figure "2" and

then followed by the word "D'Salaam". It should also be noted that in annexure A to

the plaint the

1985 TLR p52

KAZIMOTO J

word "Branch" is written in full, figure "2" is missing and the word "D'Salaam" is

written in full and appears below A the words "City Drive Branch". Exhibit D1

shows two deposits made by the plaintiff on 28/6/1983. Even to the unaccustomed

but scrupulous observer he would not have failed to notice the naked difference

between B annexure A to the plaint and Exhibit D1. Having pointed out these vital

and basic differences between the two documents tendered in evidence I am left in no

doubt in my mind that annexure A to the plaint is not an authentic document and the

money allegedly deposited with the defendant was not in fact deposited. Mr. Kesaria

learned C advocate referred me to two English cases Lewes Sanitary Steam Laundry

Company (Ltd) v Barclay and Company (Ltd) [1906] TLR page 737 and The

Kepitigalla Ruber Estates, Limited v The National Bank of India, Limited (1909) 2 KB

1010. Both these cases deal with the defence of estoppel by negligence. In the D

Lewes Sanitary Steam case the directors of the company appointed the son of the

Chairman as secretary of the company and allowed the secretary to have the custody

of the company's cheque book and bank pass-book. In order to draw a cheque the

signature of the secretary and a director were required. The secretary forged the E

signature of a director to a number of cheques purporting to be drawn on behalf of

the company, and obtained payment from the company's bankers. On an action

brought against the defendant to recover the amount the defendants raised the

defence of negligence by estoppel. Kennedy J., held, after quoting a number of

authorities F that:

But in order to relieve the banker from the consequence of paying money

upon a forged cheque, it is not enough for the banker to show that the conduct of his

customer, wilful, careless or wasteful or all, enabled the fraud to be committed. He G

must show that the customer caused him to pay the money upon the forged cheque.

It is not enough to show that the customer gave occasion for his so paying .... The

carelessness of the customer or neglect of the customer to take precautions

unconnected with the act itself, cannot be put forward by the banker as justifying his

own default.

The facts in Kepitigalla's case above quoted are exactly the same as the Lewes Sanitary

Steam case. But I H tend to think that the principles in these two cases cannot be

applied to the facts in the present case. Whereas in these cases the servants of the

plaintiff companies forged cheques which enable the defendant companies to pay I

funds out of the plaintiffs accounts, in the present case it was established that the

defendant never received and therefore never paid any money out of the plaintiff's

1985 TLR p53

account. I think the defendant would be liable if it were established that Annexure A

to the plaint were authentic A and the defendants servants did not enter the amount

in the plaintiff's account. I gather from cross-examination by Mr. Kesaria that as the

pay-in-slip is prepared and issued by the defendant, that once a customer has filled in

the pay-in-slip which is stamped by the defendant's stamp, that as there is no warning

to warn customers of fake B stamps, then the defendant should be held liable. Yes

the defendants will be held liable if the pay-in-slip contains the defendants bank

rubber stamp. But in this case Annexure A does not have, as demonstrated above, the

defendant's rubber stamp or even a semblance of such stamp. I am not persuaded to

hold the mere fact that C there is no warning about fake stamps should render the

defendant liable.

For these reasons, having found that plaintiff did not pay in his bank account the sum

of Shs.31,200/= as shown in Exhibit A to the plaint, I am satisfied that the plaintiff's

case fails as the defendant would not have done what is D alleged in issues (b) and

(c) nor is the plaintiff entitled to any interest claimed in issue (d). Consequently I

dismiss the plaintiff's claim with costs.

Judgment for the defendant

1985 TLR p53

F