2022
COURT OF APPEAL
GHANA
CORAM
AI Generated Summary
The Court of Appeal (Aryene JA, with Welbourne JA presiding and Bright Mensah JA concurring) reviewed a commercial landlord–tenant dispute between Achimota Retail Center and Enda Foods Ltd (with two individual guarantors). Enda executed a five-year fixed-term lease at Achimota Mall, denominated in USD but payable in cedi equivalents. After Enda notified plaintiff in April 2016 and ceased trading by July 2016, the landlord sought rent through August 2017, utilities, interest, and authority to sell seized fixtures. Defendants disputed rent and utility computations and claimed damages for unlawful seizure and asset values. The appellate court held that denominating rent in dollars but paying in cedis did not breach the Foreign Exchange Act, adjusted rent arrears to US$28,038.38 to account for a US$33,706 security deposit, affirmed utilities arrears (with VAT on electricity only), and upheld interest under CI 52. It declared the landlord’s self-help seizure unlawful under Article 18, awarded GH¢20,000 damages, rejected defendants’ valuation counterclaim, and granted plaintiff three months’ rent as damages for breach of the fixed-term tenancy given plaintiff’s failure to mitigate.
NOVISI ARYENE JA:
This is an appeal against the judgment of the High Court (Financial Division) dated 20th March 2020. In this appeal, we shall maintain the designations of the parties at the trial court.
The facts are that 1st defendant rented a shop in Achimota Mall from plaintiff sometime in 2015 for a period of five years, commencing November 2015 to October 2020. Rent was at US45 per square meter, the Ghana Cedi equivalent of $7,020 per month. 2nd and 3rd defendant gave an undertaking to indemnify plaintiff in event of the default of 1st defendant. A year into the tenancy, 1st defendant decided to vacate the premises and informed plaintiff in writing. An attempt by the parties to agree on the terms of termination by way of Mandate to-let, as proposed by plaintiff, failed.
Despite plaintiff’s letter informing 1st defendant to keep the shop open until a replacement tenant was found, the 1st defendant stopped operating the shop at the end of July 2016, leaving its assets, fittings and fixtures in the shop. Plaintiff contended that by vacating the shop before the expiry of the agreed five year term, 1st defendant was in breach of the tenancy agreement. Plaintiff further contended that 1st defendant left an outstanding debt of US$107,739.70 being rent arrears from July 2016 to August 2017 and that it also failed to pay for utilities in the sum of US$36,158.26 for November 2015 to July 2016.
Following the vacation of the shop, plaintiff engaged a logistics and freight forwarding company to remove and store 1st defendant’s assets at a designated place, and plaintiff held onto the assets as security for payment of the debts owed. All attempts to get defendants to settle their just debts proved futile consequently, plaintiff sued defendants for the following reliefs:
I. The payment of US$107,739.70 being the total outstanding rent arrears of the 1st defendant as at 31st August 2017.
II. Interest on relief (i) at the prevailing bank rate of the plaintiff’s bank from 31st August 2017 to date of final payment.
III. The payment of US$36,158.26 being outstanding balance of utilities consumed by the 1st defendant as at 31st July 2016
IV. Interest on relief (iii) at the prevailing bank rate of the plaintiff’s bank from 31st July 2016 till date of final payment.
V. An order for the sale of the seized items…….. to defray part of the defendants’ debt.
As was to be expected, defendants denied the claim and put plaintiff to strict proof. They averred that they d