February 29, 2016
COURT OF APPEAL
GHANA
CORAM
AI Generated Summary
In the Ghana Court of Appeal, Torkornoo (Mrs) J.A. authored a judgment affirming a High Court decision in favour of the Export–Import Bank of the United States (Ex‑Im Bank) against Bibiani Logging & Lumber Company Ltd and its guarantors. The 1st Appellant obtained a US$901,765 credit facility from First International Bank (USA), defaulted, and Ex‑Im Bank, as guarantor, paid the lender and sought reimbursement. The Appellants did not deny the loan or default but alleged fraud and frustration, challenged capacity and forum, and counterclaimed. The trial judge found the action competent, rejected defences and counterclaims, and awarded the Respondent’s claims. On appeal, Appellants improperly filed additional grounds without leave, arguing the attorney’s authority and foreign governing law. The Court condemned the procedure, upheld Respondent’s capacity through assignment and promissory notes, emphasized presumptions of lawyer and corporate authority, applied the Evidence Act’s foreign law presumption, found Appellants’ acceptance/rejection argument misconceived, and dismissed the appeal with costs.
JUDGEMENT
TORKORNOO (MRS), J.A.
The Plaintiff Respondent (hereinafter referred to as Respondent) commenced this action by an attorney Mrs. Claris Efa Quayson. The Respondent’s case against the Defendants/Appellants was that the 1st Appellant had obtained a credit facility of US$901,765 from First International Bank of United States of America. They had failed to honor their repayment obligations and as guarantor to the lender on the debts, the Plaintiff had been called to pay the debt of principal with interest. It had paid the said debt to First International Bank and was now seeking reimbursement from the Appellants.
Its case was that the 2nd and 3rd Appellants had executed unconditional guarantees to pay the 1st
Appellant’s debts and also executed promissory notes to that effect. The Respondent claimed for:
1. The total sum of One million, Six Hundred and Twenty Two Thousand, Seven Hundred and Thirty-Two United States Dollars (US$1,622,732.00) being the outstanding amount and unpaid balance on the total credit facility plus ordinary accrued interest and post maturity interest as of December4, 2009.
2. Interest at the rate of 4.5% per annum above LIBOR on the Outstanding Sum from December 4, 2009 to date of final payment.
3. Cost incurred in this matter; and
4. Any other order (s) as this Honorable Court may deem fit.
In a 30 paragraph defence, the Appellants did not deny the fact of obtaining the loan and their failure to repay. The 2nd and 3rd Appellants also did not deny issuing guarantees to repay the debt. However, they set up legal defences against being called on to pay the debt as well as a counterclaim. It was their defence that the Plaintiff was not entitled to its claims because of fraud and the operation of the doctrine of frustration.
In addition to raising these doctrines as shields against the claim, the Appellants raised an objection to the forum in which the action had been commenced in paragraphs 27 of their defence. In paragraph 28, they also raised a defence against the capacity of the Plaintiff with these words.
28. The Defendants shall also contend that the Plaintiff has no capacity to institute the present suit.
Then in paragraph 29, the Defendants alleged a defence against the writ with these words.
29 The Defendants say that the writ before the court is incompetent and same cannot operate to invoke the jurisdiction of the court’.
They went on to counterclaim for:
Counter claim
a. A declaration that the contra