NDK FINANCIAL SERVICES v. SAFRE LIMITED & ANOTHER
2019
COURT OF APPEAL
GHANA
CORAM
- FRANCIS KUSI-APPIAH J.A (PRESIDING)
- HENRY KWOFIE J.A
- MERLEY WOOD (MRS) J.A
Areas of Law
- Commercial Law
- Contract Law
- Civil Procedure
2019
COURT OF APPEAL
GHANA
CORAM
AI Generated Summary
The Plaintiff, a non-banking financial institution, appealed a High Court ruling favoring them against the Defendants for a sum of GH₵74,087.92 but applied with simple interest. The Plaintiff contested for contractual compound interest, while the Defendants disputed the debt amount and claimed procedural errors. The Court of Appeal upheld the Plaintiff’s contention for compound interest and dismissed the Defendant’s claims for variation, confirming that the evidence showed the contractual interest was compound and that the Defendant admitted the debt amount.
HENRY KWOFIE (JA):
This appeal is from the judgment of the High Court (Commercial Division) Accra delivered on 2nd day of May 2017 in which the Court entered judgment in favour of the Plaintiff against the Defendants for the sum of GH₵74,087.92 together with interest at simple interest rate from the date of the issue of the writ to the date of final payment. The Court further awarded cost of GH₵3000 in favour of the Plaintiff.
The facts giving rise to this appeal are that the Plaintiff is a non-banking financial institution authorized by the Bank of Ghana to extend short-term credit facilities to customers. The Plaintiff’s case is that by a letter dated 8th December 2005, the 1st Defendant applied for a discounting facility of GH₵45,000 from the Plaintiff against 1st Defendant’s receivables from the Controller and Accountant General’s Department which was approved and granted. It is the case of the Plaintiff that the 1st Defendant by several additional letters applied for and the Plaintiff approved and granted 17 additional loans to the 1st Defendant. That all these facilities were approved and granted at various compound interest rates. Plaintiff says that the securities for the facilities extended to the 1st Defendant were:
i) A mortgage agreement executed between the 2nd Defendant and Plaintiff and
ii) An undertaking from the Controller and Accountant Generals Department.
The Plaintiff says the 1st Defendant Company has refused to repay the indebtedness to it notwithstanding persistent oral and written demand notices given by the Plaintiff to the 1st Defendant.
The 1st Defendant denied the Plaintiff’s claim. It’s case is that it had an arrangement with the Controller and Accountant General’s Department by which credit sales it makes to public sector workers are deducted at source and credited to it. That based on its available funds with the Controller and Accountant General’s Department at various times, it requested for and was granted various discounting facilities by the Plaintiff and that the entire credit arrangement is based on expected funds from the Controller and Accountant General’s Department in favour of the 1st Defendant. These expected funds from the Controller and Accountant General’s Department in favour of the 1st Defendant is then credited to an account in the joint names of both the Plaintiff and the 1st Defendant. The 1st Defendant admits that the Plaintiff granted to it the various facilities set out in the Plaintiff’s claim