Mere issuance of payment instruction does not relieve debt obligation– Industrial Court

Justice Ogbuanya, National Industrial Court, Portharcourt Division.


The National Industrial Court, Port Harcourt Division, presided over by Hon. Justice Nelson Ogbuanya has held that mere issuance of payment instruction does not relieve debt obligation in e-payment system now in vogue. 

Justice Ogbuanya made the declaration while delivering judgment in the suit filed by Fedison ManPower Supply Ltd against Niger Blossom Drilling Ltd.

From facts, the Claimant’s- Fedison ManPower Supply Ltd had submitted that in fulfilling its obligation as specified in the Labour Supply Agreement signed with Niger Blossom Drilling Ltd, it mobilized the human labour and operated the rig until the contract was terminated by pan Ocean that the Defendant refused to pay the outstanding debt of N72, 512,015 (Seventy-Two Million, Five Hundred and Twelve Thousand, Fifteen Naira), which was the sum agreed to by the parties after reconciliation of invoices sent. 

In defense, Niger Blossom Drilling Ltd said it has paid because it has issued transfer instructions to its Bankers and also issued some cheques in favour of the Claimant, and therefore not owing the Claimant as alleged, urged the court to dismiss the case.

In opposition, the Claimant denied receiving any such payment and pointed that the Defendant only tendered the copies of the cheques and transfer instructions, urged the court to grant the reliefs sought.

After reviewing evidence and submissions on the substantive claim for recovery of the owed contract sum, Justice Ogbuanya held that the burden of proof is on the Defendant to establish how the payment it said it made was received by the Claimant in satisfaction of the debt. 

In its finding, the court stated that: “On the whole, I find that there is no evidence that the Defendant has indeed paid the Claimant the said owed sum, which though acknowledged by the Defendant and was said to have been paid through instructions, but which could not be established by credible evidence that such payment instructions were indeed carried out by the Defendant’s banker, so as to confirm that the Claimant indeed received payment of the owed sums by the Defendant”. 

According to the Judge:  “To my mind, in modern e-payment system, the mere issuance of payment instruction does not relieve an obligation to pay owed debt, as the obligation subsists until the owed party receives the sum due as instructed to be paid. 

“This should be a corollary to the new technological approach to e-payment system which is often fraught with manipulative practices, and even outright mischief.  I so hold”. 

The Court granted the claims for the Claimant’s outstanding debt of N72, 512,015, and awarded damages of N2,000,000.00, and N300,000.00 as cost of the action, payable within 2 months.

WORDS ON MARBLE: “Only a life lived for others is a life worthwhile”….TAN.