High Court Judge Underscores The Bank’s Fiduciary Duty To Do Due Diligence
In the matter between Umu Jalloh, surviving spouse of Mohamed Bob Jalloh, who died intestate, and Abdul Kareem Jalloh (1st Defendant), Sierra Leone Commercial Bank (2 Defendant) and General Manager (3rd defendants), Lawyer Tejan, representing the Plaintiff, in his argument, submitted that the question ought to be answered is whether the Letter of Administration (LA) taken by the first defendant, for which the 2nd and 3rd defendants paid to 1st defendant, is lawful.
He explained that there are two categories in the LA, where the defendants defaulted, pointing out that the defendant is a legal entity. He noted that the LA on the estate was sworn in 10,000 and that they (2nd and 3rd defendants) relied on that LA to pay well over 400,000
He stressed that the 2nd and 3rd defendants went on relying on that faulty LA in disbursing, adding that no matter what the reason, their act and conducts are wrong in law under High Court Rules Order 17.
He explained that if the third question ought to be answered in the negative, it followed suit in the 4th question, hence the root is default, and every act done in reliance of that LA are legally void pursuant to the devolution of estate act.
“The defendant has no good defence, 7 paragraphs in their defence are denials. These denials are in paragraphs 2.4,7 9, 12 and 13. All these denials have chains, claiming that their act is diligent and proper in law, considering the LA, and in disbursing the capacity way outside the LA,” Tejan maintained.
That 4 of their paragraphs 1, 6, 8 and 11 place the burden of proof on the plaintiffs, noting that once the pleadings are legally sufficient, legal requirements of the fact are sufficient.
He said that they have pleaded enough information to the stretch of their limit, emphasizing that in the LA taken out, there is nowhere the name of the spouse is surfaced, and she is never aware of the LA taken and never consented for it to be taken out. To cancel an LA, you have to come to court under Order 55, by law is not the administrator.
Justice Fisher cautioned that once an LA has been given, it is valid document, paid for by admission and the court will need to cancel it, but Lawyer Tejan insisted that the LA is invalid and illegal, and that they are in Court for it to pronounce the illegality and put a stop to it, pursuant to section 3 sub section 2 of the Devolution of Estate Act.
Justice Fisher demanded that Lawyer Tejan provide him with an authority to show that it is illegal, but Lawyer Tejan insisted that the Bank is a legal entity and it behoves them to do the right thing, but acting on that LA is wrongful and illegal.
Lawyer Jalloh, representing the 2nd and 3rd defendants, said that they relied on their affidavit, particularly for their clients, noting that there is no application for summary judgement before the Court, as High Court Rules Order 16 sub-rule 1 and 2 are quite instructive.
“Our defence raises triable issues, and it is a good defence in law,” he said, adding that with regards the second question of Law, counsel has misconstrued and misconceived the factual basis of the case.
He said that the estate was valued at Le10,000 and 100% shares in interest, but that counsel conceived the estate personally with regards Musia Agric Ltd, noting that the money was actually disbursed to Musia Agric Ltd.
He said that the LA, once it has been granted, is valid until revoked, but Justice Fisher asked who is entitled to take out an LA, noting that there is clear provision in the law as to who should take an LA.
“The Law is very clear. The person who took out the LA is not a spouse or the next of kin. The bank has a fiduciary duty to do due diligence based on the Banking Act,” he said
Justice Fisher asked if the Bank did due diligence, but Lawyer Jalloh responded that the LA was taken in respect of Mohamadan Law.
“Where is it stated in the LA that it was taken under Mohamedan Law? Does the Mohamedan Law supersede the Devolution of estate act? The bank has duties if I give out a cheque, the Bank Calls,” Justice Fisher illustrated.
Jalloh noted that it is quite sacrosanct that official documents are presumed to be regular and that once the LA has been presented, it is presumed they conform with every regularity. He noted that a company, once incorporated, is a separate legal person, and the money was given to Musia Agric Business, noting that it is only fair that they go to trial, but Lawyer Tejan insisted that Musia Livestock company cannot be divested from its owner, noting that the matter will help Sierra Leone’s Jurisprudence.
The Judge reserved the matter for ruling on summary judgement.