SG-SSB LIMITED v. AMOS ALUMINIUM LINK CO. LTD & ORS
2016
HIGH COURT
GHANA
CORAM
- JUSTICE JENNIFER A. DODOO (MRS)
Areas of Law
- Contract Law
- Evidence Law
- Civil Procedure
2016
HIGH COURT
GHANA
CORAM
AI Generated Summary
In the case, the Plaintiff bank provided an overdraft facility to the Defendants, who secured it with a legal mortgage. The Defendants defaulted and claimed the contract was frustrated due to a natural disaster (flooding). The court rejected this claim, holding them liable to repay the debt with interest. The Plaintiff's claims were partially upheld, and the court awarded costs against the Defendants while dismissing their counterclaims. Key legal principles addressed included the burden of proof, the proof required in law, and the obligations under loan contracts. The court ruled based on agreement terms and statutory provisions regarding the award of interest.
JUDGMENT
On 29th January 2014, the Plaintiff filed an amended writ of summons and statement of claim in which it claimed against the Defendants, the following reliefs:
a. Defendants pay the Plaintiff the amount of GH¢46,727.82 being outstanding balance on the overdraft facility granted to the Defendants
b. Interest on the said amount from 31st July 2013 to date of final payment at the prevailing bank rate
c. Costs occasioned by this action.
d. A perpetual injunction preventing the Defendants either by themselves, privies or agents from letting out the property used in securing the loan facility to any 3rd party without the leave of the Honourable Court.
It was the Plaintiff’s case as set out in its Statement of Claim that on or about 8th November 2010 and at the 1st Defendant’s request, the Plaintiff approved an overdraft facility of GH¢25,000.00 which attracted an interest rate of 32.50 % per annum. It was further agreed between the parties that in case of default, any sum unpaid would attract a penal interest rate of 6% per annum above the indicated interest rate.
Plaintiff also averred that the 2nd and 3rd Defendants provided security in the form of a legal mortgage over property situate at Ablekuma.
The Defendants in their Amended Defence and Counterclaim filed on 12th March 2015 admitted receiving a banking facility from the Plaintiff. They however contended that the performance of the terms and conditions of the contract was frustrated by an act of God which was a torrential downpour of rain which caused flooding and led to the destruction of their stock in trade.
As a result, they said they brought their predicament to the Plaintiff’s notice. Not only did the Plaintiff ignore this state of affairs but continued to charge interest on the facility. They therefore put forth the following counterclaim:
i. A declaration that the contract between the parties had been frustrated by an act of God being the supervening act for which reason there was no need for the Plaintiff Bank to be surcharging the Defendants further interest on the facility which they very well knew had been caught by a supervening act.
ii. A further declaration that what the Defendants owe the Plaintiff was the principal sum plus the interest that accrued at the time of the occurrence of the supervening act and no more so as the contract between the parties had been frustrated by an act of God being the supervening act.
iii. An order for the payment to the Plaintiff by the D