STEPHEN TREBARH & ANOR VS HFC BANK GHANA LTD
April 30, 2024
HIGH COURT
GHANA
CORAM
- HER LADYSHIP JUSTICE GIFTY DEKYEM (MRS.)
Areas of Law
- Contract Law
- Banking and Finance Law
- Property and Real Estate Law
- Evidence Law
- Civil Procedure
April 30, 2024
HIGH COURT
GHANA
CORAM
AI Generated Summary
This High Court decision by Justice Gifty Dekyem concerns borrowers under the Uncompleted Houses Scheme who received two mortgage loan facilities from a bank to complete their four-bedroom house at Mile 50, Adweso, Koforidua. The first facility (18 January 1999) carried a 15-year term and a variable interest starting at 4.5% per annum; the second (2 September 1999) increased the total to GHS1,934.57 and added a 10% penal charge on arrears. The bank issued multiple demand notices and later restructured the loan in 2011, but the borrowers defaulted and their property was attached for sale. At trial, the bank’s relationship manager confirmed a variable rate reviewed against economic conditions. A court-appointed financial analyst corroborated interest calculations but did not quantify liability, while the bank’s statement (Exhibit 20) showed GHS71,233.08 outstanding. Applying the Evidence Act and case law on burdens and documentary proof, the court entered judgment for the debt with simple interest at the prevailing commercial rate from the date of judgment and awarded costs.
Plaintiffs per their writ of summons and statement of claim filed 10th April 2015, sought the following reliefs:
(a) recovery of property,
(b) Declaration of unreasonable interest and other charges on a loan facility of GHS1, 900 by the Defendant,
(c) Declaration that the GHS9, 231. 11 paid by the plaintiffs to the defendant constitutes full payment of the loan facility.
d) Perpetual injunction to restrain the Defendant from sale of the property.
e) Costs.
The statement of claim indicates that per a mortgage agreement dated 18TH January 1999 under the ‘Uncompleted Houses Scheme’, between the Plaintiffs as mortgagors and Defendant as mortgagee for the completion of the Plaintiffs’ four-bedroom house, the Plaintiffs obtained a loan amount of GHS1, 890. The mortgage period was 15 years with an initial monthly installment of GHS11. 29. It is the case of the Plaintiffs that the loan agreement did not specify any interest but subsequently noticed that the Defendant was applying between 4. 5% to 5. 5% per month and imposed unlawful compound interest. Plaintiffs contend that as a result of Defendant’s conduct, the outstanding loan balance became GHS88, 000. 00 which became impossible for Plaintiffs to pay.
Consequently, Defendants attached Plaintiff's house for sale to defray the unlawful debt wherefore, Plaintiffs sought the above reliefs.
COUNTERCLAIM Defendant denied Plaintiffs’ claim and averred that a mortgage facility was granted the Plaintiffs dated 18th January 1999 in the sum of GHS1, 520. 00 and a subsequent loan of GHS370 making a total of GHS1, 936 which was secured with a four-bedroom uncompleted house at Adweso, Koforidua.
As a pre-disbursement condition under the facility, Plaintiffs signed a mortgage deed dated 17th February 1999 to enable Defendant to register the mortgage over the property thus the 1st Plaintiff deposited the title deed of the property with Defendant.
It is the case of the Defendant that a facility letter dated 2nd September stated that the repayment arrears shall attract a penalty charge equivalent to 10% of the amount in arrears.
It is the case of the Defendant that several demand notices were sent to the Plaintiffs informing them of the arrears with accrued interest and outstanding balance but they failed and refused to settle same.
Defendant contended that it was entitled under the mortgage deed to enter possession upon default after giving Plaintiffs 30 days' notice.
It is the case of Defendant that upon the req