GHANA OIL COMPANY VS BAMICH INVESTMENTS & ANOR
March 10, 2016
HIGH COURT
GHANA
CORAM
- HIS LORDSHIP ANTHONY K. YEBOAH (JUDGE)
Areas of Law
- Contract Law
- Commercial Law
- Civil Procedure
- Evidence Law
March 10, 2016
HIGH COURT
GHANA
CORAM
AI Generated Summary
In the High Court of Ghana, His Lordship Anthony K. Yeboah granted summary judgment in favor of a petroleum products company against State Insurance Company Limited (SIC Insurance), the guarantor of Bamich Investment Ghana Limiteds 12-month supply credit with Ghana Oil Company Limited (GOIL). The guarantee bond, dated 11 March 2013, obligated SIC to pay GOIL upon first written demand, without requiring GOIL to prove its claim or first demand payment from Bamich. SIC opposed summary judgment arguing GOILs demand was premature until the 12-month credit period expired and that improper notice discharged SICs liability. The Court, interpreting the bond by its ordinary meaning, held the demand need not await the periods expiry, found the notice proper, and further reasoned that effluxion of time made any prematurity argument untenable under the Wednesbury principle. The Court entered final judgment for GH215,335.68 plus interest from 29 October 2013 and costs of GH5,000.
The plaintiff, a registered corporate entity dealing in petroleum products, sued Bamich Investment Ghana Limited (1st defendant) per the plaintiff’s lawful attorney, Johnson Complex (Gh) Ltd. Bamich Investment Ghana Limited is also a corporate entity and the customer of the plaintiff company.
The plaintiff has sued Bamich Investment Ghana Limited for the recovery of the amount of GH¢ 315, 335. 68 and interest on the amount calculated at the prevailing bank lending rate from 29-10-2013 till the date of final payment.
In this suit, the plaintiff initially sued Bamich Investment Co.
Ltd and later amended the Writ of summons to join the State Insurance Co.
Ltd. Accordingly, Bamich Investment Ltd is now the 1st defendant and the State Insurance Co.
Ltd is the 2nd defendant.
According to the plaintiff, they entered into a supply credit agreement with the Bamich Investment Ghana Limited, according to which the plaintiff would supply them with petroleum products on credit over a time period of 12 months.
To secure the supply credit agreement, the plaintiff obtained a bond guarantee dated 11-3-2013 from the State Insurance Company Ltd (2nd defendant) for the due repayment of the value of the supply credit agreement.
By a notice filed by the 2nd defendant on 27-2-2015, the 2nd defendant also claims against the 1st defendant an indemnity of GH¢ 315, 335. 00 plus interest and costs.
On 27-2-2015, the 2nd defendant filed a statement of defence in which they contend that “the premature call in of the Bond discharged it from liability under the Bond. ” In the alternative, the 2nd defendant contends that they are entitled to be indemnified by the 1st defendant in the event where judgment is entered against them by the court by reason of the bond.
On 20-8-2015, pursuant to Order 14 of C. I. 47, the plaintiff filed an application for summary judgement against the 2nd defendant for the reliefs endorsed on the amended writ of summons.
To the affidavit in support, the plaintiff exhibited the power of attorney in proof of the capacity of their lawful attorney, a statement of account clearly showing the indebtedness of the 1st defendant as standing at GH¢ 315, 335. 68, a copy of the guarantee bond no. P/120/04/4120/2013/9 and the correspondence relative to the call in of the bond.
In their opposition to the application, the 2nd defendant reiterated their contention that the call in of the bond was premature, because the liability of the 1st defendant to settle the de