Wakilii

Bitwire & Another v The Co-operative Bank Limited (Civil Appeal No. 21 of 2007)

High Court · [2019] UGHC 82 · 2019 Appeal Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from High Court judgment dismissing plaintiffs' claim against defendant bank
Decision
Appeal dismissed with costs; High Court judgment affirmed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Court of Appeal dismissed the appeal. The appellant failed to prove that the respondent bank received actual notice of the countermand of payment. Exhibit P.2 (the stop payment letter) bore no bank stamp acknowledging receipt, and no countermand entry was made in the ledger card. The evidence was contradictory regarding the presence of the bank official who allegedly received the letter. In the absence of actual notice, the bank was under a contractual duty to honour the cheques. The appellant also failed to prove the alleged deposit of UGX 20,000,000 as the deposit slip lacked essential details.

Outcome

Appeal dismissed with costs; High Court judgment affirmed

Facts

The appellants sued as administrators of the estate of David Bitwire (deceased), who was a customer of the respondent bank's Kasese branch. In August 1998, ADF rebels attacked Kasese town and looted the deceased's business premises, taking two signed cheque leaves. The deceased allegedly notified the bank on 1 August 1998 to stop payment on the cheques. In October 1998, the two cheques were presented and honoured by the bank, resulting in withdrawals totalling UGX 100,000,000. The appellants also claimed that UGX 20,000,000 deposited by bank draft on 28 August 1998 was not credited to the account, and that an unauthorised debit of UGX 30,000,000 had been made. The total claim was UGX 150,000,000. The claim arose after the bank demanded repayment of an outstanding loan and served statutory notice of its intention to sell mortgaged property. The High Court dismissed the claim with costs. The appellants appealed.

Issues

  1. Whether the respondent bank received actual notice of the countermand of payment to stop the two cheques.
  2. Whether the respondent bank was under a duty to honour the cheques in the absence of effective notice of countermand.
  3. Whether the deceased deposited UGX 20,000,000 into his account as evidenced by the deposit slip.

Orders

  • Appeal dismissed.
  • Costs to the respondent here and below.

Rules and key headnotes

Banking & Finance — Countermand of Payment — Actual Notice Requirement
For a countermand of payment to be effective, it must be brought to the actual (not constructive) knowledge of the bank. Actual notice is such notice as is positively proved to have been given to the party directly and personally, or such as he is presumed to have received personally because the evidence within his knowledge was sufficient to put him upon inquiry.
Banking & Finance — Banker's Duty to Pay Cheque — Countermand as Determining Factor
Under section 74 of the Bills of Exchange Act Cap. 68, the duty and authority of a banker to pay a cheque drawn on him by his customer are determined by countermand of payment or notice of the customer's death. In the absence of actual notice of countermand, a bank is under a contractual duty to honour a properly presented cheque.
Evidence — Burden of Proof — Bank Deposit Slips
Deposit slips are not incontrovertible documents beyond dispute. Once certain essential features are missing from a deposit slip (such as draft number, originating bank, or bank stamp acknowledging receipt), the onus of proof rests with the alleged depositor to prove that the deposit was indeed made.

Legislation cited (2)

Cases cited (4)

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Bitwire & Another v The Co-operative Bank Limited (Civil Appeal No. 21 of 2007) [2019] UGHC 82 (12 November 2019)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.