PAUL JACQUAYE v. IDEAL FINANCIAL HOLDINGS LTD
2016
HIGH COURT
GHANA
CORAM
- HIS LORDSHIP ERIC KYEI BAFFOUR JUSTICE OF THE HIGH COURT
Areas of Law
- Contract Law
- Evidence Law
- Corporate Law
2016
HIGH COURT
GHANA
CORAM
AI Generated Summary
The plaintiff sold his shares in Ezi Savings and Loans Ltd. to the defendant. The defendant alleged misrepresentation of the company's financial status and failed to complete the payment. The court found that the plaintiff misrepresented material facts, making the contract voidable but not void. However, the defendant affirmed the contract by continuing investment and rebranding. The court rejected the counterclaim for damages and debts owed by other companies and upheld the plaintiff’s claim for the outstanding payment with interest.
JUDGMENT
Plaintiff claims the following endorsement on its writ issued on 06/07/15 against the defendant:
1. An order for the payment of the sum of Four Million Ghana cedis.
2. Interest on the said sum at the prevailing interest rate from 1st July, 2014 till date of final payment.
3. Damages for breach of contract.
4. Costs.
5. Any other orders the court may deem fit.
The plaintiff provides the basis of his claim to the reliefs he seeks in the statement of claim that accompanied the writ. He styles himself as a businessman and a former majority shareholder cum chairman of the Board of Directors of Ezi Savings and Loans Ltd. Plaintiff claims that sometime in 2014, based on a series of negotiations with the defendant, plaintiff agreed to sell his 70% shares in Ezi Savings & Loans amounting to 7.000.000 shares to defendant at a price of Ghc 5.000.000.00. Defendant paid Ghc1.000.000.00 and was supposed to pay Ghc4.000.000.00 by September, 2014, after defendant had completed an audit of Ezi Savings & Loans. To plaintiff the terms of this agreement were initially captured in a memorandum of understanding (MOU) signed between them which provided that if the auditing gave different information from what plaintiff had provided defendant was at liberty to withdraw from the contract and demand a return of the deposit paid with interest on the amount.
Bank of Ghana which had regulatory oversight was duly informed and it gave approval for the transaction. Besides the MOU which was signed, the parties also executed what they called Share Purchase Agreement (SPA). Defendant carried out the financial due diligence on Ezi Savings & Loans Ltd and completed same in July, 2014. Plaintiff further claim that defendant duly received the financial due diligence of Ezi Savings & Loans and afterwards decided to proceed with the transaction. That the Board of Ezi Savings & Loans was formally dissolved in a meeting on 21st July, 2014 at Madina. The defendant took over and changed the name of Ezi Savings & Loans to First Trust Savings & Loans Ltd (1st Trust S&L) with a new Chief Executive Officer. In terms of the MOU signed, according to plaintiff, defendant should have paid all the Ghc5.000.000.00 by September, 2014 and yet the defendant has still not fulfilled its promise. Defendant has communicated to him of its intention not to make further payments because of a misrepresentation of information to it. Plaintiff then concludes that defendant has no intention of paying