Following an application by the 1st defendant to the 2nd defendant bank for a loan of N200,000.00, the same was granted on a guarantee provided by the plaintiff in respect of his property covered by his Statutory Certificate of Occupancy No. BDSR 5273 registered as No. 9 at Page 9 in Volume B.69 at the Lands Registry in the office a Benin City. The plaintiff deposited this Certificate of Occupancy with 2nd defendant had previously deposited his Customary Certificate of Occupancy No. BDCR 54 registered as No. 40 at Page 40 in Volume B. 11 at the Lands Registry in the office at Benin City as security for the same loan.

A tripartite legal mortgage, Exhibit E, was subsequently executed to cover the loan. The plaintiff duly guaranteed the repayment of this loan by signing the 2nd defendant's guarantee form, Exhibit D.

On the basis of the above securities offered, the 2nd defendant bank allowed the 1st defendant to draw on the said loan. After taking full benefit of the said loan facility, the 1st defendant abandoned his account with the 2nd defendant and defaulted in the repayment of the loan.

It ought to be mentioned that the plaintiff and the 1st defendant on their own entered into an agreement, Exhibit A, which made provisions at to how the 1st defendant would operate his relevant account with the 2nd defendant bank. The 2nd defendant bank was not a party to Exhibit A. It is the finding of both courts below that Exhibit A was deposited with the said 2nd defendant bank.

When the 1st defendant defaulted in the repayment of the loan, the 2nd defendant bank made several demands on both the plaintiff and the 1st defendant to repay the loan and the interest thereon. Instead of making repayment of the said loan guaranteed by him, the plaintiff instituted an action against both defendants claiming jointly and severally as per paragraph 16 of his amended Statement of Claim.

At the conclusion of hearing, the learned trial Judge after a review of the evidence on the 6th day of October, 1989 entered judgement for the plaintiff as claimed.

Dissatisfied 2nd defendant bank appealed to the court of appeal which unanimously allowed the appeal and held that it was an error in law for the trial court to have Arrived at the conclusion that the 2nd defendant bank was bound by the terms of agreement, Exhibit A, to which it was not a party.

Plaintiff/appellant appealed to the Supreme Court.