LEGAL PRINCIPLE: BANKING LAW — Definition of Banking Business — Banking Business Defies Precise Compartmentalisation
PRINCIPLE STATEMENT
Like many other beings, a banker is easier to recognize than to define. In case of doubt, it is permissible to look at the reputation of the firm amongst ordinary intelligent commercial men. The term banking defies positive and readily identifiable definition.
RATIO DECIDENDI (SOURCE)
Per Pats-Acholonu, JSC, in Societe Bancaire (Nigeria) Limited v. Lluch (2004) NLC-2862002(SC) at pp. 9–10; Paras E–A.
"Like many other beings, a banker is easier to recognize than to define. In case of doubt it is, I think, permissible to look at the reputation of the firm amongst ordinary intelligent commercial men. [...] What the learned jurist was saying is that you cannot easily compartmentalize the term banking. In other words, it defies positive and readily identifiable definition."
EXPLANATION / SCOPE
Banking defies precise compartmentalisation and is easier to recognize than to define. In doubtful cases, the firm’s reputation among commercial men may guide determination. The principle applies to banking law and jurisdiction. The rule acknowledges the evolving nature of banking activities. No single exhaustive definition captures all banking business. Courts should consider practical commercial understanding.
