WEALTH MANAGEMENT LTD VS GAZY VENTURES LTD & ANOR
January 11, 2017
HIGH COURT
GHANA
CORAM
- HIS LORDSHIP JUSTICE GEORGE BUADI J.
Areas of Law
- Contract Law
- Banking and Finance Law
- Commercial Law
- Evidence Law
- Civil Procedure
- Corporate Law
January 11, 2017
HIGH COURT
GHANA
CORAM
AI Generated Summary
An Accra-based financial institution extended a GH100,000 bridge finance facility to a local company upon request by its chief executive officer, secured by the CEOs Ablekuma property (Title No. 280/1970 (AC6882/68)). Only GH42,660 was disbursed under Agreement Clause 5, which required tranche releases on a justified need basis. The borrower defaulted and admitted owing, while alleging the lender delayed or refused releases and counterclaimed for lost revenues and profits. The court held the lender had discretion to release funds upon adequate justification, found no proof of properly submitted requests or supporting documentation (including a confirmed customer order), and rejected email and improperly addressed communications as insufficient. The counterclaim failed for lack of particularization and strict proof. The court affirmed the lenders reliefs, ordered sale of the mortgaged property only in the alternative, and awarded costs of GH4,000.
1. 0 Background After the conclusion of trial, the court on 1 November 2016 delivered its judgment and granted the reliefs plaintiff sought on its amended writ of summons.
1 The court however emphasized that plaintiff’s ‘relief c’ shall rather be in the alternative; not in conjunction with other reliefs.
The court reserved reasons underlying its decision to its next sitting, i. e. today 11 January 2017, which the court provides as below.
1. 1 Pursuant to 1st defendant’s request for “bridge finance facility”, and upon an undertaking or guarantee by 2nd defendant in furtherance of an agreement covering the request, plaintiff granted 1st defendant an amount of GH¢100, 000. 00. 1st defendant could access only GH¢42, 660. 00 out of the sum granted.
1st defendant had defaulted repayment of the facility, as a result of which plaintiff had commenced this suit against both defendants for recovery of the amount.
1. 2 Plaintiff is a local financial institution with its offices in Accra.
1st defendant is a local company, and that 2nd defendant is its chief executive officer cum board chairman.
On or around 17 September, 2010, upon request of 2nd defendant for and on behalf of 1st defendant, plaintiff granted 1st defendant a loan facility of GH¢100. 000. 00. A total of GH¢42, 660. 00 of the facility was disbursed for expansion of 1st defendant’s business operations.
2nd defendant agreed to secure repayment of the facility with his landed property at Ablekuma, Accra, registered as No. 280/1970 (AC 6882/68) at the Title Registry.
The agreement was executed subject to terms including 4. 5% monthly interest rate inclusive 1. 5% processing fee, with a default charge of 3% per month on amount outstanding to be repaid.
Plaintiff contends that the GH¢42, 660. 00 that 1st defendant could access was advanced in tranches, payable within a period of twelve (12) months commencing from the date of execution of the loan facility agreement.
1. 3 Plaintiff’s claim is that 1st defendant has since failed to repay the amount, and that as at 3 May, 2012, defendants were indebted to it in the sum of GH¢122, 134. 15. Plaintiff claims therefore against defendants the reliefs as indorsed on the amended writ of summons as follows: (a) GH¢122, 134. 15 being the balance outstanding on the loan amount advanced to 1st defendant with accrued interest as at 3rd day of May, 2012; (b) Interest on the said amount at the commercial interbank monthly rate of 4. 5% plus default charge of 3%