SUMAILA ABDULAI VS JOSEPH BOADU
2016
HIGH COURT
GHANA
CORAM
- JUSTICE JANAPARE A. BARTELS-KODWO (MRS)
Areas of Law
- Contract Law
- Corporate Law
2016
HIGH COURT
GHANA
CORAM
AI Generated Summary
The Plaintiff and Defendant began a vehicle sale business in July 2012, with the Plaintiff claiming the Defendant owed GH¢131,900.00 for unsold vehicles. The Defendant argued that all transactions were conducted by West Palm Investment Limited, of which he is Managing Director, and that he should not be personally liable. The Court found that the Plaintiff dealt with a corporate entity, not the individual Defendant, and that the Defendant acted in a fiduciary capacity on behalf of West Palm Investment Limited. Thus, the Plaintiff sued the wrong party, and the case was dismissed with no order as to costs.
By a Writ of summons and its Statement of Claim the Plaintiff’s reliefs are:-
a) An Order for Specific Performance
b) Specific damages
c) General Damages
d) Interest
e) Costs for instituting this suit
f) Any other cost.
Plaintiff contended he started doing business with the Defendant in July, 2012 in the sale of vehicles. The total value of vehicles given to the Defendant to sell stand at GH¢175,900.00 out of which an amount of GH¢44,000.00 has been paid leaving an outstanding amount of GH¢131,900.00. Despite various demands on the Defendant it has failed to pay this amount.
The Defendant on the other hand by its amended statement of defence denies the case of the Plaintiff. Defendant states it has not by itself personally transacted any business with the Plaintiff. He avers he is the Managing Director of the Company, West Palm Investment Limited and transacted business in that capacity for and on behalf of the Defendant with the Plaintiff.
Therefore in law he was not the proper person to be sued therefore Plaintiff’s claim as brought should be struck out.
The Court based upon the pleadings filed at the case management stage ordered both parties to file written submissions in respect of the Defendant’s assertions that the Plaintiff dealt with a body corporate and not the Defendant as an individual.
The Defendant in its written submissions filed on its behalf by counsel argued that the law governing the operation of companies is as found in SALMON V. SALMON [1897] AC 22 per Lord Ma…states that:
“The company is at law a different person altogether from the subscribers to the memorandum and although it may be that after the incorporation the business is precisely as it was before, and the same persons are Managers, and the same hands receive the payments: the company is not in law the agent of the subscribers or a trustee for them. Nor are the subscribers as members liable in any shape or form”.
He relied also on the cases of KLUDJESON INT. LTD V. ROBERT N. PAILIT [2013] 31 MLJ PART 31 PAGE 114 @ 118 and MORKOR V. KUMA [1989/90] GLR 620 @ 632 and argued that a company is a legal entity with a separate capacity to sue and be sued distinct from the persons that constitute it or are employed by it.
Based upon this position of the law the Defendant states that it acted as the Managing Director of the company West Palm Investment Limited and transacted business in that capacity for and on behalf of the Defendant with the Plaintiff. He prayed th