THE REPUBLIC v. BANK OF GHANA EX PARTE: HODA HOLDINGS LTD.
July 7, 2022
COURT OF APPEAL
GHANA
CORAM
- SUURBAAREH, JA (PRESIDING)
- MERLEY WOOD, JA
- J. BARTELS-KODWO, JA
Areas of Law
- Administrative Law
- Banking and Finance Law
- Civil Procedure
July 7, 2022
COURT OF APPEAL
GHANA
CORAM
AI Generated Summary
The Court of Appeal reviewed the High Courts dismissal of an application by the Appellant, the majority shareholder of Unicredit Ghana Limited, seeking certiorari to quash the Bank of Ghanas revocation of Unicredits licence. The case arose after the Bank of Ghanas supervision of Unibank led to frozen funds and Unicredits capital deficiencies, prompting warning letters and corrective directions. The High Court focused on the merits of insolvency and undercapitalization, concluded there were no procedural missteps, and dismissed reliefs. On appeal, SUURBAAREH, JA held that section 123 authorizes the decision to revoke but does not replace the statutory revocation procedure, which is set out in section 16(3)4) requiring notice and an opportunity to respond. The court found no emergency or public interest to justify bypassing notice under section 16(7), emphasized Article 296s fairness obligations, criticized the regulators failure to address OB5, and ultimately allowed the appeal, set aside the High Courts judgment, and quashed the revocation.
SUURBAAREH, JA
This is an appeal against the judgment of High Court, Accra, Human Rights Division, dated 18th March 2021. The Applicant/Appellant, by its amended motion of 8th November 2019, sought an order of Certiorari directed at the Respondent/Respondent, to bring up to the High Court, for the purpose of being quashed, its notice dated 16th August 2011, declaring Unicredit Ghana Limited insolvent and revoking its licence to operate as a Specialised Deposit-Taking Institution. It also sought to restrain the Respondent/Respondent by itself, agents, assigns, privies and all persons claiming by or through it from interfering with the operations of Unicredit Ghana Limited, and for the matter to be referred to Arbitration.
From henceforth, the parties would simply be referred to as Appellant and Respondent respectively. The Appellant is a Limited Liability Company under the laws of Ghana, and majority shareholder of Unicredit Ghana Ltd. Unicredit Ghana Limited, prior to 20th March 2018, had most of its investment in Unibank Ghana Limited, estimated to be GH¢54,000,000.00.
On 20th March 2018, the Respondent, acting under Section 107(1) of the Banks and Specialized Deposit-Taking Institutions Act, 2016, (Act 930) appointed an administrator to take over and strengthen the activities of Unibank Ghana Ltd. The administrator, for some unexplained reasons, restricted Unicredit Ghana Ltd. access to its investment held with Unibank Ghana Ltd., on alleged instructions from the Respondent. The Appellant’s case shows that the Respondent subsequently revoked the licence of Unibank Ghana Ltd. and consolidated it with other defunct banks into Consolidated Bank of Ghana Ltd., resulting in Unicredit Ghana Ltd’s investments, hitherto held with Unibank Ghana Ltd., now being held by Consolidated Bank Ghana Ltd., which investments, Unicredit Ghana Ltd., per exhibit OB2, sought to retrive through the Respondent.
The Appellant, who alleged that at all material times Unicredit Ghana Ltd. had investments estimated at GH¢164,000,000.00 with UniSecurities Ghana Ltd., one of its subsidiaries, were however impaired by the Respondent, contrary to its own regulations, thereby creating substantial reduction in Unicredit Ghana Ltd’s capital adequacy ratio. According to the Appellant, Unicredit Ghana Ltd., despite this setback, quickly mobilized, through the Appellant and its shareholders, to restore Unicredit Ghana Ltd. capital adequacy ratio, to meet the requirement of the Respondent,