July 23, 2003
SUPREME COURT
CORAM
AI Generated Summary
Skanska Jensen International, a civil engineering contractor in Ghana, engaged Cyprus-based refrigeration engineers to perform HVAC works for the Golden Tulip Hotel’s new Executive Guest Rooms Wing. The parties discussed and initialled a standard-form draft subcontract (Exhibit H) and signed minutes capturing core terms (Exhibit G), but no formal subcontract was executed, and essential elements such as a Bill of Quantities were later introduced in Exhibits K1 and K2 and contested. Despite performing HVAC engineering and ductwork from December 1996, the Respondents’ engagement was terminated on 3 April 1997 for alleged failure to provide a performance guarantee. The High Court awarded USD 224,533.29 on quantum meruit and dismissed the Appellants’ counterclaim; the Court of Appeal affirmed and pegged interest to the dollar rate. On further appeal, a unanimous Supreme Court (per Dr. Seth Twum, JSC) held Exhibit H was not binding; declined arbitration for want of a proper stay motion and waiver; and recalibrated quantum meruit to reasonable remuneration. Appointing AESL as court experts, the Court fixed net compensation at USD 44,341.28, with simple interest at the dollar rate from 4 April 1997.
JUDGMENT
DR. SETH TWUM, JSC:
On 17th February 1999 The Plaintiff/Respondent (hereafter called "the Respondents") issued a Writ of summons accompanied by a statement of claim in the High Court Accra, against the Defendants/Appellants. In the course of the trial, the Respondents wholly discontinued their action against the 2nd Defendant, namely GLAHCO HOTELS & TOURISM DEVELOPMENT CO. LTD. and its name was struck out from the suit, leaving SKANSKA JENSEN INTERNATIONAL (hereinafter "the Appellants")
The Writ of Summons was indorsed with the following reliefs:—
(1) Payment of the sum of USD 224,533.29 or its cedi equivalent at the current Forex Bureau rate of exchange at the date of payment being the Plaintiff's bill for the supply of equipment and materials and engineering services for HVAC works executed by the Plaintiff at the New Executive Guest Rooms Wing of Golden Tulip Hotel at the request of the 1st Defendant as the main Contractors for itself and on behalf of the 2nd Defendant as the contract owners from December, 1996 to March 1997 and which bill the defendants have failed or refused to pay despite persistent demands up to this day.
(ii) Interest on the said USD 224,533.29 from 15th April, 1997 up to the date of final payment at the current bank rate.
(iii) Damages for breach of contract.
(iv) Any other relief found due.
Statement of Claim
This contained 22 paragraphs. For the purpose of this appeal we set out below the most important paragraphs.
4. In the latter part of 1996, the 1st Defendant, as the main contractor, for itself and on behalf of the 2nd Defendant, as the contract owner, invited the Plaintiff to undertake the HVAC works (ie. to supply engineering and installation of air-conditioning system) for the 2nd Defendant's New Executive Guest Room Wing of the Golden Tulip Hotel.
5. Pursuant thereto the Plaintiff per its Managing Director, Mr. George Zoudros, on the one hand, and the 1st Defendant's Manager, Mr. Chris D. Kragh, on the other hand executed documents on 23rd December 1996, containing the main terms of the agreement reached between the parties.
6. On the same date (23rd December 1996) the parties discussed and initialled in draft form a detailed sub-contract document which the parties mutually intended to govern the execution of the HVAC sub-contract. It was further mutually agreed that the formal sub-contract agreement based on the draft would be drawn up by the 1st Defendant for execution by the parties.
7. Due t