Zambia National Commercial Bank Plc v Ketty Mtonga and Anor (APPEAL NO. 47 /2022) [2024] ZMCA 126 (24 January 2024)

IN THE COURT OF APPEAL OF ZAMBIA APPEAL NO. 47 /2022 HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN: ZAMBIA NATIONAL COMMERCIAL BANK PLC APPELLANT AND KETTY MTONGA TIWONGE MTONGA 18 T RESPONDENT 2ND RESPONDENT CORAM: . MAJULA, NGULUBE AND BANDA - BOBO - JJA. On 18th January and 24th January, 2024. For the Appellant: S. N Wamulume, Ndemanga Mwalala and Associates For the Respondent: D. M. Kaira and K. Kalimbwe, Charles Siamutwa Legal Practitioners JUDGMENT NGULUBE JA, delivered the Judgment of the Court. Cases referred to: 1. Shreeji Investments Limited vs Zambia National Commercial Bank Appeal No. 143/ 2009 2. 3. Australian Mutual Provident Society vs Derham (1979) 39 FLR 165 Inda Zambia Bank Limited vs Lusaka Chemist Limited, SCZ Appeal No. 74 of 2002 4. 5. 6. 7. 8. London Joint Stock Bank vs Macmillan [1918-1919] All ER REP. 30 Income Tax Special Purposes Comrs. vs Pemsel [1891] AC 531 Commissioner of State Savings Bank vs Permewan Writ and Co. 1 9 CLR 457, 478 Lloyds Bank vs Chartered Bank of India [1929] 1 KB 73 Bank of Zambia vs The Attorney General (1974) Z. R. 24 9. Wilson Masauso Zulu vs Avondale Housing Project Limited (1982) Z. R. 10. Zambia Telecommunications Company Limited vs Aaron Mulwanda & Paul Ngandwe, Appeal No. 63 of 2009 11. Manda Hill Centre Limited vs Fresh View Cinemas Limited, Appeal No. 154/2019 12. Zambia Revenue Authority vs Jayesh Shah (2001) Z. R. 60 13. RDS Investments Limited vs Moon Jelly Ouseph Joseph (2001) Z. R. 60 14. Sithole vs The State Lotteries Board(l 975) Z. R. 106 15. Chansa vs The People (1975)Z. R. 136 (S. C.) 16. Elijah Bob Litana vs Bernard Chimba & The Attorney General (1987) Z. R. 26 (S. CJ 17. Elias Tembo vs Henry Sichembe & Two Others, Appeal No. 177 of 2014 18. Atlantic Bakery Limited vs Zesco Limited, Selected Judgment No. 61 of 19. Anderson Mazoka vs Mwanawasa & Others (2005) Z. R. 138 20. Richard Chama & 213 Others vs National Pension Scheme Authority & Others, SCZ/8/230/2012 21. Mukula & Highway Transport Limited vs Chiwala & Another, Appeal No. 163/2012 22. Ahmed Wandi & Smart Transport vs Kostic Investment Limited, Selected Judgment No. 30 of 2019 23. Barclays Bank Plc vs Quincecare [1992] 4 All ER 363 -J2- 24. National Westminster Bank Limited vs Barclays Bank International Limited [1975] 1 QB 654 25. Barclays Bank Limited vs WJ Simms, Sons & Cooke f 1980] QB 677 at Works referred to 1. Clerk and Lindsell on Torts, 19th Edition Thomson Sweet and Maxwell, London. 1.0 INTRODUCTION 1.1 This appeal is against a Judgment of the High Court (Chawatama, J) dated 29th December, 2021, pursuant to which the Court ordered a refund of the sum of K50,600.00 fraudulently withdrawn from the 1st respondent's bank account held with the appellant at its Government Business Centre branch in Lusaka. The Court also awarded the 1st respondent nominal damages in the sum of Kl,000.00 for the appellant's breach of its duty to exercise care and skill. 2.0 BRIEF BACKGROUND 2.1 The appellant was the defendant in the Court below while the 1st respondent was the plaintiff. The 2nd respondent was a third party to the action. 2.2 After the 1st respondent retired from the civil service, she opened account number 05009000115885 with the appellant bank where she -J3- • deposited part of her retirement benefits in 2000. She relocated to England in 2005 and never had access to her account until 2006 when she visited Zambia. She went back to England until 2010 when she travelled to Zambia and discovered that her account was run down as there were several withdrawals made without her authority. The account remained with a balance of K3,152.72 and the bank statements revealed that several withdrawals were made from her account at various branches. 2.3 She examined the withdrawal slips used to debit her account and observed that the signatures on the slips were not hers and that one of the withdrawal slips only had a thumb print. The 1st respondent was shown copies of her National Registration Card (NRC) on her mandate file at the appellant bank which were used to withdraw the money from her account. 2 .4 The details on the copies of her NRC were exactly the same as those of her original NRC which was in her possession the entire time she was in England. The photocopies on her NRC only related to the • disputed withdrawals. According to the 1st respondent, during the period that she was away in England, the appellant had updated its system whereby its customers needed to submit pictures which was referred to each time someone wanted to withdraw money over the counter. That however, her account was not updated because she did -J4- • not submit a picture. That at one point before the issues in this matter arose, she attempted to withdraw money from her account but the appellant did not allow her because her account was not updated. 2.5 She made a written complaint to the bank about the unauthorized withdrawals but received no reasonable response despite several attempts to follow up. 2.6 She then commenced the present action in the Court below seeking a refund of the sum of KS0,600.00 being the amount which was alleged to have been fraudulently withdrawn from her account maintained with the appellant. 2.7 The appellant denied the 1st respondent's claim and alleged that all withdrawals were made by the 1st respondent herself and that she did not inform the bank that she had relocated to England. That the withdrawals were disbursed on withdrawal slips presented by the plaintiff who was paid according to her mandate given to the appellant. 2.8 According to the appellant all monies were withdrawn by the 1st respondent over the counter after producing her National Registration Card which the appellant verified before paying out the money. The appellant averred that if at all the money was debited through forgery, the appellant paid the money in good faith and in the ordinary course of business. That such forgery could not have been detected by the -JS- appellant which applied the ordinary standard of verification expected of a bank. 2.9 The appellant stated that the 1st respondent should be estopped from setting up an allegation of forgery because the alleged forgery was committed for over five years and six months during which period bank statements were sent to her. It was contended that she did not inform the appellant of any anomalies on the account. That in any event, any loss suffered by the 1st respondent was due to her own negligence as she allowed third parties to use her NRC and impersonate her. That findings of the investigations revealed that the 2nd respondent was the one making withdrawals from the 1st respondent's account. That the appellant believed that the 1st respondent was within the country during the period 2005 to 2010, as there was no notification from her indicating otherwise. 2.10 The appellant alleged that no difference was seen between the specimen signature on the mandate form and the withdrawal form. That a cashier would not make a payout where there was a difference in the signatures on the mandate file and the withdrawal form. 2.11 The appellant also made a third party claim against the 2nd respondent (third party in the Court below) on basis that in the event that the appellant was found liable to the 1st respondent, it should be -J6- indemnified by the 2nd respondent who authored the withdrawal slips as per the Drug Enforcement Commission (DEC) investigations report. 2.12 The 2 nd respondent denied the third party claim against her on ground that the appellant was not entitled to be indemnified by her because she did not author the disputed withdrawal slips, or forge the 1st respondent's signature. That the only time she had dealings with the 1st respondent's account was when she deposited rentals and proceeds of phone sales into the 1st respondent's account. She stated that DEC officers asked her to replicate the 1st respondent's signature for purposes of investigations but failed to investigate who placed the thumb print on one of the withdrawal slips, which would have been crucial evidence for the investigations. 2.13 The 2nd respondent alleged that the appellant's own personnel withdrew the money because every withdrawal slip from the disputed slips had a photocopy of the 1st respondent's NRC attached and it was the appellant's own personnel who had access to the copy of the NRC on the 1 st respondent's mandate file. The 2nd respondent stated that on the date when the K30,000.00 was withdrawn, a transaction of K3,000.00 made over the counter was reversed which could only have been done with the appellant's authority but the appellant failed to show who authorized the reversal. -J7- 3.0 DECISION OF THE LOWER COURT 3.1 The lower court considered the pleadings and evidence before it and found that the appellant was not absolved from its duty of care when operating its client's account. The lower Court held that the 1st respondent was entitled to a refund of KS0,600.00 which was fraudulently withdrawn from her account and nominal damages in the sum of Kl,000.00 together with costs. As against the third party claim, the lower Court found that the case against the 2nd respondent (third party in the Court below) was not prosecuted. 4.0 THE APPEAL 4.1 The appellant was dissatisfied with the decision of the lower court and appealed to this court, advancing five grounds of appeal couched as follows- 1. The learned Judge in the Court below erred in fact and in law when she held that the appellant conceded that the 1st respondent's money was fraudulently withdrawn from her account on the basis of a report from the Drug Enforcement Commission without establishing how the appellant was negligent or derelict in its duties. 2. The learned Judge in the Court below misdirected herself in law when she failed to address the appellant's defence of estoppel against the 1st respondent. 3. The learned Judge in the Court below erred in law and in fact when she ignored the 2 nd respondent's liability as a -JS- third party to the action and failed to make pronouncement against the 2nd respondent. 4. The learned Judge in the Court below erred in law and in fact when she proceeded to close the case and render judgment without receiving expert evidence on the basis that the appellant was nonchalant with its witness without proof of service of a hearing date for 23rd February, 2021. 5. The learned Judge in the Court below erred in law when she held that the 1st respondent did not plead negligence but still went ahead to find that the appellant owed a duty of care to the 1st respondent. The authorities relied upon by the Court below relate to claims for negligence and the respondent's case in the Court below was that of fraudulent withdrawal of money. 4.2 The appellant filed heads of arguments in support of the appeal. In arguing ground one, Counsel for the appellant submitted that the lower Court's conclusion that the appellant conceded that the money was fraudulently withdrawn from the 1st respondent's account was erroneous because the appellant did not concede, and the conclusion was made without establishing how the appellant was liable for the withdrawals. It was argued further that the basis of the lower Court's conclusion was the DEC report which stated that money was fraudulently withdrawn from the 1st respondent's account. That however, the mere fact that money was fraudulently withdrawn does -J9- • not make the appellant liable because it was the duty of the trial Judge to weigh the evidence before her. 4.3 It was submitted that there was no basis for the appellant's liability because the appellant's evidence showed that the money was disbursed in accordance with the 1st respondent's mandate. 4.4 Section 2(2) of the Cheques Act Chapter 424 of the Laws of Zambia was referred to which provides that- "(2) Where a banker in good faith and in the ordinary course of business pays any such instrument as the following, namely: (a) a document issued by a customer of his which, though not a bill of exchange, ts intended to enable a person to obtain payment from him of the sum mentioned in the document; (b) a draft payable on demand drawn by him upon himself, whether payable at the head office or some other office of his bank; he does not, in doing so, incur any liability by only of the absence of, or irregularity, in endorsement, and the payment discharges the instrument." 4.5 Further, the cases of Shreejt Investments Limited vs Zambia National Commercial Bankl and Australian Mutual Provident Society vs Derham:z were referred to where Section 60 of the Bills of Exchange Act, 1882 was discussed. The said section provides that if a banker on whom the bill is drawn pays the bill in good faith and in -JlO- • the ordinary course of business, it is not incumbent upon the banker to show that the endorsement of the payee was made under the authority of the person it purports to be. 4.6 It was argued that what makes a bank liable for payments made on forged instruments is if the payment was made in a way that was so unusual that it should have raised doubts in the banker's mind. To buttress this argument, the cases of Inda Zambia Bank Limited vs Lusaka Chemist Limited,3 London Joint Stock Bank vs Macmillan, 4 Income Tax Special Purposes Comrs vs Pemsel, 5 Commissioner of State Savings Bank vs Permewan Writ and Co,6 and Lloyds Bank vs Chartered Bank of India7 were referred to. 4.7 Counsel argued that all payments were made in good faith and in the ordinary course of business. That the lower Court did not state what was out of the ordinary course in payments made to the 1st respondent because as far as the appellant was concerned, all payments to the 1st respondent were in person and that she had in her possession, a National Registration Card. That the signature on the withdrawal slip was compared to the one on the mandate file and the 1st respondent did not alert the appellant that she was out of the country. -Jll- 4.8 In support of ground two, it was submitted that the lower Court erred because it failed to address the appellant's defence of estoppel. That the appellant was entitled to the defence because the alleged forgery occurred for over five years and the appellant was lulled into safety believing that the withdrawals were done by the 1st respondent. Reference was made to the learned authors of Ellinger's Modern Banking law 5 th Edition and Paget's Law of Banking 6th Edition where it is stated that the defence of estoppel may be based either on the customer's conduct before the cheque is forged or altered or on his behavior after he has obtained knowledge of the conduct. 4. 9 The case of Bank of Zambia vs The Attorney General8 was referred to where it was held that the conduct which prejudices the opportunity of the bank to recover the money must be shown to be the proximate cause of the particular loss in respect of which estoppel is being set up. 4. 10 It was argued that the lower Court fell in to grave error and failed to adjudicate on all matters in controversy before her when she failed to address the defence of estoppel. To buttress this argument, Section 13 of the High Court Act, Chapter 27 of the Laws of Zambia and the cases of Wilson Masauso Zulu vs Avondale Housing Project Limited, 9 Zambia Telecommunications Company Limited vs Aaron Mulwanda & Paul Ngandweio and Manda Hill Centre -J12- Limited vs Fresh View Cinemas Limited11 were referred to. The learned author of Zambia Civil Procedure: Commentary and Cases, Volume 2, page l l l 7was also referred to, to argue that the judgment of the lower Court left matters inconclusive and subject to further interpretation by the parties. 4.11 It was argued in support of ground three that the lower Court ignored the 2 nd respondent's liability as a third party and failed to make a pronouncement against her. It was argued that for the lower Court to have allowed third party proceedings against the 2 nd respondent, it meant that the trial Judge was of the view that there are questions which were rightly to be disposed of in the action before her in accordance with Order 16 Rule l of the Rules of the Supreme Court. Therefore her failure to determine the third party claim, failed to bring the action to finality. 4.12 It was argued further that the object of Order 16 Rule l of the Rules of the Supreme Court is to prevent multiplicity of proceedings by enabling the Court to determine all disputes in one action and to prevent the same question from being tried twice. That since the lower Court did not determine the third party claim, the risk of bringing another action on the same issue is inevitable. 4.13 In support of ground four, it was submitted that the lower Court was in error when it proceeded to render judgment without receiving expert -J13- evidence from the appellant without proof of service of the date of hearing for 23rd February, 2021. That the lower Court had no preserve of proceeding in the absence of the parties without service as this was contrary to Order 35 Rule 3 of the High Court Rules. 4.14 It was submitted that the Court did not sit on the scheduled date of 18th February when the appellant was supported to call its expert witness and the matter was then rescheduled to 23rd February, 2021 without issuing a notice of hearing. That as a consequence thereof, the parties did not attend Court on 23rd February, 2021 and by proceeding in the manner that she did, the trial Judge defeated the course of justice because the appellant had placed reliance on the anticipated evidence of the expert witness. In arguing that matters should be determined on merit, the cases of Zambia Revenue Authority vs Jayesh Shah12 and RDS Investments Limited vs Moon Jelly Ouseph Joseph13 were referred to. 4.15 It was submitted that that lower Court could not have made a just decision without the guidance of the evidence of the handwriting expert. To argue on the importance of the expert evidence to the present case, various cases were referred to which include: Sithole vs The State Lotteries Board,1 4 Chansa vs The People, 15 Elijah Bob Litana vs Bernard Chimba & The Attorney Generall6 and Elias Tembo vs Henry Sichembe & Two Others. 17 -J14- 4.16 It was argued in support of ground five that the trial Judge erred when she found that the appellant owed a duty of care when 1st respondent did not plead negligence but for a refund of her money. To support this argument, the case of Atlantic Bakery Limited vs Zesco LimitedJBwas cited. The case of Anderson Mazoka vs Mwanawasa & Others1!1was also cited on the function of pleadings. 4.17 Lastly, Counsel referred to the case of Richard Chama & 213 Others vs National Pension Scheme Authority & Others2 0 where it was held that if judges apply their own knowledge or personal perceptions not informed by the evidence presented to them, they may deprive the parties of the opportunity to address such information and perceptions with evidence and submission. Counsel prayed that we should allow the appeal and set aside the judgment of the lower Court. 5.0 THE HEARING 5.1 At the hearing of the appeal, the learned Counsel for the appellant, Mrs. Wamulume informed the court that the respondent's Advocates filed their heads of argument on 151h January, 2024, without leave of court. We were urged to expunge the respondents' heads of argument from the record for being improperly before the court. Mrs. Wamulume emphasized that there was inordinate delay on the part of the respondents when they filed their heads of argument in January, -J15- 2024 when they were served with the appellant's heads of argument in 2022. 5.2 The respondent's counsel conceded that they filed their heads of argument on 15th January 2024 but were of the view that the appellant was not prejudiced in any way. 5.3 We considered the appellant's counsel's application and were of the view that there was inordinate delay in filing the respondent's heads of argument without leave of court on 15th January, 2024. 5.4 Accordingly, we ruled that the respondent's heads of argument be expunged from the record. 6.0 CONSIDERATION OF THE APPEAL AND VERDICT 6.1 We have considered the record of appeal and the parties' arguments. After examining the five grounds of appeal proffered by the appellant, we have concluded that grounds one and five can be argued together as they are related while the other grounds of appeal can be argued seriatim. We shall therefore first address ground four, then grounds one and five. Lastly we shall address grounds two and three respectively. 6.2 The issues we are being called upon to interrogate in ground four is that the lower Court was in grave error when it proceeded to close the case and render Judgment in the absence of expert evidence. Counsel -J16- for the appellant argued that the lower Court did not issue a notice of hearing to the parties and proceeded without proof of service. 6.3 We note from the record of appeal that when the appellant's first witness completed his testimony, the matter was adjourned to 25th November, 2019 for continued defence. When the matter came up on 25th November, 2019, Counsel for the appellant was present and the matter was adjourned to 3rd February, 2020 at the instance of the appellant. When the matter came up on 3rd February, 2020, it was again adjourned at the instance of the appellant. On 23rd February, 2021, when the lower Court decided to proceed to render Judgment, the following was the lower Court's ruling- "The matter was heard on the l()th of April 2017. The matter was adjourned to 19th July, 2017 at 09:30 hours for hearing the adjournment. There have been several adjournments in between the last one being today. I have decided that I would proceed with Judgment because it has become clear that the defendant no longer desires to call its two witnesses nor the witnesses for the third party for the above and in the interest of justice I will proceed to render my Judgment in this matter." 6.4 Further we have noted from the record of appeal on page 227 that the 1st respondent closed her case on 10th April, 2017. Order XXXIII Rules 1 and 2 of the Rules of the High Court Act, Chapter 27 of the Laws of Zambia makes it clear that an adjournment is granted -J17- at the discretion of the Court, after it is satisfied that the reason for the adjournment is genuine. In our view, the Judge in the lower Court stated her reasons for declining the adjournment as shown on page 268 of the record of appeal. We are fortified by the case of Mukula & Highway Transport Limited vs Chiwala & Another21 where the Supreme Court of Zambia stated that- "Therefore, by ordering the closure of the case and then proceeding to Judgment delivery, the learned trial Judge acted perfectly within his discretionary power." 6.5 It has not been shown that the trial Judge exceeded her powers. We have noted from the trial Judge's sentiments that the appellant had a laissez-faire attitude towards the prosecution of its case. Based on the foregoing, we cannot fault the learned trial Judge in refusing the adjournment and we find no merit in ground four and accordingly dismiss it. 6.6 Turning to grounds one and five, the arguments here are that: firstly, the 1st respondent did not plead negligence but the lower Court found that the appellant owed a duty of care to the 1st respondent when the case was for fraudulent withdrawal of money; secondly, that the trial Judge was at fault when she held that the appellant conceded that the 1st respondent money was fraudulently withdrawn on the basis of the -J18- .. DEC report without establishing how the appellant was negligent in its duties. 6.7 Regarding the first issue, it is not in dispute that the 1st respondent did not plead negligence but merely made a claim for a refund of the sum of KS0,600.00 fraudulently withdrawn from her account. 6.8 The renowned authors , Clerk and Ltndsell on Tort state the requirements for the tort of negligence as follows- "(l} The existence in law of a duty of care situation, t.e one in which the law attaches liability to carelessness. There has to be recognition by law that the careless infliction of the kind of damage in question on the class of persons to which the claimant belongs by the class of persons to which the defendant belongs ts actionable; (2) breach of the duty of care by the defendant, i.e. that he failed to measure up to the standard set by the law; (3) a casual connection between the defendant's careless conduct and the damage; (4) that the particular kind of damage to the particular claimant ts not so unforeseeable as to be too remote. " 6.9 The above is the test that a claimant has to overcome ifhe is to succeed in a claim for negligence. The Supreme Court of Zambia held in the case of Ahmed Wandt & Smart Transport vs Kostic Investment Ltmtted22 that- "The test requires the claimant to specifically plead negligence and demonstrate by evidence duty owed to him -Jl9- .. by the defendant; how the defendant's actions fell short of the standard set by law; as a consequence of the acts (careless) by the defendant, the claimant has suffered damages; and, the damages suffered were foreseeable." 6.10 It is therefore clear that the 1st respondent ought to have pleaded negligence for the appellant to be found liable in negligence. The learned trial Judge noted on page J19 of the Judgment that the 1st respondent did not plead negligence, however the appellant was not absolved from their duty of care. We agree with the learned trial Judge because it is settled law that the relationship between banks and their customers is contractual and captured by the general law of contract. We are fortified by the case of Barclays Bank Plc vs Quincecare23 where Steyn, J stated as follows- "Primarily, the relationship between a banker and customer is that of debtor and creditor. But quoad the drawing and payment of the customer's cheques as against the money of the customer's in the banker's hands the relationship is that of principal and agent ... Prima facie every agent for reward is also bound to exercise reasonable care and skill in carrying out the instructions of his principal .. There is no logical or sensible reason for holding that bonkers are immune from such an elementary obligation. In my judgment, it is an implied term of the contract between the bank and the -J20- customer that the bank will observe reasonable skill and care in and about executing the customer's orders. Moreover a banker may in a case such as the present be sued in tort as well as in contract, the duties in contract and tort are co-extensive, and in the context of the present case nothing turns on the question whether the case is approached as one in contract or tort." 6 .11 It therefore follows that despite the 1st respondent not pleading negligence against the appellant, the learned trial Judge did not err as she properly held that the appellant owed the 1st respondent a duty of care, because the appellant's duties to the 1st respondent in both tort and contract law, are co-extensive. Since the 1st respondent did not plead negligence, it was erroneous for the lower Court to have found the appellant liable in negligence. The lower Court should have found that the appellant owed the respondent reasonable care and skill owing to their contractual relationship. 6.12 Turning to the second argument, the appellant contends that the lower Court did not establish how the appellant was negligent or derelict in its duties. We have perused the Judgment of the lower Court which stated as follows on page J 19- "The plaintiff has proved in undisputed terms that the defendant paid out on withdrawal slips that were fraudulently issued. The defendant stated in their defence that they had captured the signature of the plaintiff on -JZ1- • •• - their system for identification of the plaintiff but failed or neglected to do so. As a result of this they allowed the plaintiffs money to be withdrawn fraudulently from her account." 6.13 The above extract was the basis of the lower Court's finding that the appellant was negligent. The fact that the money was fraudulently withdrawn was clearly disputed by the appellant. As far as the appellant was concerned, they acted according to the 1st respondent's mandate. The report of the Office of the Inspector General of Police on page 135 of the record of appeal confirms that the 1st respondent did not author the withdrawal slips used to withdraw the money from her account and that the signatures on the withdraw slips were a forgery. We are of the view that the lower Court therefore did not err in finding that money was fraudulently withdrawn from the 1st respondent's account. 6.14 However, the question is whether there was a basis upon which the appellant can be said to have failed in its duty to exercise reasonable care and skill. 6.15 As guided by the Court in Shreeji Investments Limited vs Zambia National Commercial Bank (supra}, a banker must not continue to pay cheques without inquiry if a reasonable and honest banker with knowledge of the relevant facts would have considered that there was -J22- • ... a senous or real possibility that the monies were being misappropriated. 6.16 Further in the case of Indo-Zambia Bank vs Lusaka Chemist Limited (supra) it was held that- "What is required of banks is not expert knowledge on the detection of forgery, but a degree of knowledge ordinarily required for the discharge of the duties. In our view, the need for a microscopic examination would only arise if there are circumstances which ought to put the bank on inquiry with regard to the authenticity of the cheques. As Bailhache J. put it in the case of Ross v Lord on County Westminster and Park's Bank Ltd (1919) KB 678 at 685; "it is therefore necessary to consider whether a bank cashier of ordinary intelligence and care on having these cheques presented to him by a private customer of the bank would be informed by the terms of the cheques themselves that it was open to doubt whether the customer had a good title to them." 6.17 In finding the appellant liable in this matter, it is cardinal to determine whether there is anything that would have put the appellant on inquiry as to the authenticity of the disputed withdrawal slips. The appellant contended that the disputed signatures and the 1st respondent's signature on the mandate file did not appear different. We are of the view that from this comparison, the appellant's cashiers -J23- • •• • - would not have known, that the signatures inserted on the withdrawal slips were forged. 6.18 We are persuaded in this regard by the case of National Westminster Bank Limited vs Barclays Bank Intemational24 where it was held that- "The common aphorism that a banker is under a duty to know his customer's signature is in fact incorrect, even as between the banker and his customer; the principle is simply that a banker may not debit his customers account on the basis of a forged signature, since he has in that event no mandate from the customer for doing so." 6.19 In view of the foregoing authority, we opine that the appellant was not under any duty to know the 1st respondent's signature but was expected not only to carry out its mandate but to exercise reasonable care and skill. 6.20 It is not in dispute that the monies withdrawn from the 1st respondent's account were withdrawn over the counter over time. The appellant's evidence on record showed that it is a requirement, that when a withdraw slip is presented, it ought to be verified by the cashier who crosses the signature of the payee to indicate certification. It was also stated by DWI during the trial, that the cashier also appends his/her signature at the back of the withdrawal slip. The witness admitted that the various withdrawal slips he was referred to at the -J24- trial did not have the appellant's cashier's signature. This indicates that there was no evidence that the withdrawal slips went through a process of certification by the appellant's cashier. 6.21 The 1st respondent's evidence was that one of the withdrawal slips had a thumb print instead of a signature. That each of the withdrawal slips had a copy of her NRC attached, indicating that the payee used a photocopy of the 1st respondent's NRC instead of the original. The 1st respondent's evidence was that the payee would not have used her original NRC because she had it with her while in England. The appellant admitted that it was not practice for the payee's original NRC to be photocopied and attached to the withdrawal slip. This supports the 1st respondent's assertion that photocopies of the 1st respondent's NRC were used to make the disputed withdrawals over the counter. In our considered view, the appellant failed to exercise the reasonable care and skill in paying out money from her account when it did not follow its own procedures. Had the payee been requested to produce the original NRC and failed to do so, the appellant would have been put on inquiry as to the authenticity of the withdrawals which were made on the account especially that one of the withdrawals made from the account was in the sum of K30,000.00. Further the appellant did not act within the 1st respondent's mandate when it authorized a -J25- payment from the 1st respondent account using a withdrawal slip where a thumb print was appended instead of a signature. 6.22 As was held in the case of Barclays Bank Limited vs Simms, Sons & Cooke,:zs a bank may only debit its customer's account where it has his mandate to do so. 6.23 Grounds one and five of the appeal therefore fail and they are accordingly dismissed. 6.24 Turning to ground two, the appellant found fault with the lower's failure to address itself to the defence of estoppel raised by the appellant. The appellant argues that the basis of this defence is that the forgery occurred for over five years during which period the appellant sent monthly statements to the 1st respondent but that the 1st respondent did not detect the anomalies in her account. It was also asserted that the 1st respondent allowed third parties to use her NRC. 6.25 The appellant did not show to which address the monthly statements were sent and the fact that 1st respondent was in England during the relevant period, it is probable that the appellant did not receive the bank statements. Further the appellant's assertion that the 1st respondent allowed third parties to use her NRC was not supported by evidence. In our considered view there was no evidence to suggest that the 1st respondent's conduct before or after the withdrawals lulled the appellant into safety that the withdrawals were genuine. The -J26- defence of estoppel was therefore not available to the appellant. This ground of appeal also fails for lack of merit. 6.26 Turning to ground three, the gist of the appellant's contention is that the Court below ignored the 2nd respondent's liability as a third party. The Lower Court found at page J16 of the Judgment that- "Apart from the statement of claim filed by the defendant against the third party to which a defence was filed by the third party, the case against the third party has not been prosecuted." 6.27 Order 16/1/8 of the Rules of the Supreme Court provides that "Once the third party is joined to the proceedings in the position of a defendant in relation to the party who brings him to the proceedings and so can counterclaim or subject to directions, he may raise a defence against the said party. The parties can all interrogate each other." 6.28 Therefore, once the appellant joined the 2nd respondent as third party to the proceedings to which the 2nd respondent filed a defence, the parties ought to have interrogated each other. This implies that the appellant ought to have proved its case against the 2nd respondent. Having failed to call its expert witness, the appellant did not prove its case against the 2nd respondent. The lower court was therefore on firm ground, when it held that the case against the third party had not -J27- .. been prosecuted. Ground three also fails and it is accordingly dismissed. 7.0 CONCLUSION 7 .1 The net result is that the appeal is unsuccessful and it is accordingly dismissed in its entirety for lack of merit. The Judgment of the lower Court with respect to the award is upheld. Costs are awarded to the 1st respondent to be taxed in default of agreement. COURT OF APPEAL JUDGE P. C. M. NGULUBE COURT OF APPEAL JUDGE A. M. BANDA - BOBO COURT OF APPEAL JUDGE -J28-