June 21, 2017
SUPREME COURT
GHANA
CORAM
Try asking the following...
JUDGMENT
BENIN, JSC:-
This matter began as a result of what was said to be a default on the part of the 1st Defendant/Appellant/Appellant, called the Appellant, to honour its obligations by way of a guarantee of certain promissory notes issued by the 2nd Defendant herein. The Appellant, through its then Managing Director, the 3rd Defendant herein, was thought to have guaranteed payment of the promissory notes upon maturity. The holders of the promissory notes considered that in the normal course of business, upon maturity the Appellant would honour its obligations under the guarantee and pay up. But it did not do so for reasons that will be disclosed shortly.
Consequently, by an amended writ of summons, the Plaintiff/Respondent/Respondent, called the Respondent, who claimed to be representing certain investors in the promissory notes, issued a writ of summons at the High Court and sought these reliefs against the Appellant:
(i). Recovery of the sum of sixty million United States dollars ($60,000,000.00) being the unpaid guarantee per Aval granted by 1st Defendant in respect of Promissory Notes issued by Eland International Ghana Limited and discounted to beneficiaries of the Plaintiff and which said Per Aval Guarantee the Defendant has failed and/or refused to honour upon default by Eland International Ghana Limited despite several and repeated demands made therefor.
(ii).Interest on the said amount at the agreed rate of eleven percent (11%) per annum from the 29th day of January 2009 till date of final payment.
(iii). Costs.
But as earlier mentioned, the Appellant resisted the claim on five grounds which are:
a. That it did not guarantee the promissory notes issued by the 2nd Defendant.
b. That it did not confirm any alleged guarantee.
c. That it had not held the 3rd Defendant out as having the sole authority or the authority of its Board of Directors to sign any guarantee or confirm any guarantee on behalf of the Bank.
d. That the entire transaction was tainted with fraud. Particulars of the alleged fraud were given.
e. The Respondent was negligent by failing to conduct due diligence.
The Appellant’s case did not find favour with the trial court so the Respondent's claims were upheld. The Court of Appeal also endorsed the Respondent's claims. The Appellant has appealed to this court on several grounds on the merit of the case.
The Appellant also, per learned counsel, raised in the statement of case, what appears to be a technical but profou
AI Generated Summary
This Supreme Court decision concerns promissory notes issued by Eland International Ghana Limited and alleged guarantee obligations of National Investment Bank Limited (NIB). The plaintiff began as Standard Bank Offshore Trust Company Limited and was later substituted by Dominion Corporate Trustees Limited, suing in Ghana 'on behalf of certain investors' associated with Sphynx Capital Markets PCC Investors and Tricon Trade Management Limited. After the High Court and Court of Appeal upheld claims for US$60 million plus interest, NIB appealed and raised a procedural objection to capacity and endorsement compliance under Order 2 rule 4(2) of C.I. 47. The Court held that the writ failed to disclose the foreign status and addresses of Sphynx and Tricon and did not adequately identify the 'certain investors.' These defects rendered the writ void, not curable by amendment or waiver, and the Supreme Court set aside all proceedings and the lower courts’ judgments.