UNIVERSAL MERCHANT BANK LTD VRS. ISAAC OWUSU ANSAH CO. LTD. AND OTHERS (BFS/29/2019) [2024] GHAHC 517 (19 December 2024)

IN THE HIGH COURT OF JUSTICE, COMMERCIAL DIVISION, HELD AT KUMASI ON THURSDAY THE 19TH DAY OF DECEMBER, 2024 BEFORE HIS LORDSHIP, JUSTICE CHARLES KWESI BENTUM - HIGH COURT JUDGE ------------------------------------------------------------------------------------------------------- SUIT NO. BFS/29/2019 UNIVERSAL MERCHANT BANK LTD - PLAINTIFF SSNIT Emporium, Airport City – Accra. VRS 1. ISAAC OWUSU ANSAH CO. LTD. - DEFENDANTS Kumasi. 2. ISAAC OWUSU ANSAH H/No. Plot 8, Nana Antwi – Kumasi. 3. FELICIA OWUSU ANSAH H/No. Plot 8, Nana Antwi Agyei Avenue, Hill Top, Ehwiamasi – Kumasi. ------------------------------------------------------------------------------------------------------ TIME: 09:56AM. JUDGMENT: The Plaintiff, is in this Court to recover the sum of GH₡18,936,525.36, alleged to be the total indebtedness of the Defendants, as at 14th December, 2018. 1 The Plaintiff, claims Interest on this Principal Sum of GH₡18,936,525.36 at an agreed Interest Rate of 28.61% from 15th December, 2018, till date of final payment. The Plaintiff seeks also, reliefs for general damages and Judicial Sale of a number of Landed properties in the alternative. The Landed Properties, according to the Plaintiff, are owned by 2nd and 3rd Defendants. The importance of pleadings in adjudication, cannot be overemphasised, and so it is with the instant case. Pleadings are the foundation of a suit. It is what gives the other party an idea of the nature of the claim or defence of the other party. See Gihoc Refrigeration & Household Products Ltd v Hanna Assi (No. 2) [2007 – 2008] 1 SCGLR, 16. It is not in dispute that, the claim in the Writ of Summons, is founded on a Bank Facility Contract, primarily, between the Plaintiff and its customer, the 1st Defendant. The Plaintiff, informs the Court that, it granted the 1st Defendant, a Loan to the tune of GH₡6,000,000.00 under terms as well as, an Overdraft of GH₡10,000,000.00, also under terms. The grant of the above stated Loan and Overdraft sums, became factual, on the pleadings, in relation to the 1st and 2nd Defendants. This is because the 1st and 2nd Defendants did not deny the grant of the said facilities by Plaintiff. The 3rd Defendant, however, denied any facility granted to the 1st Defendant by the Plaintiff. The Plaintiff went on to say that, the Overdraft was renewed upon terms. That it was payable on demand and at an Interest Rate of 27.16% per annum. The Defendants denied this said Overdraft renewal. 2 The Plaintiff stated again, that its customer, the 1st Defendant, was granted a medium-term Loan of GH₡5,429,387.38. This amount was explained by the Plaintiff to be a total sum of the balance of the GH₡6,000,000.00 Loan being GH₡2,429,387.38 on one hand and the unutilised Overdraft Facility, being GH₡3,000,000.00. It is significant to note that, the original Contract related to the grant of the GH₡6,000,000.00 and the GH₡10,000,000.00 Overdraft. Having allegedly consolidated the balance of the GH₡6,000,000.00 Loan and the unutilised Overdraft sum into a Medium- Term Loan of GH₡5,429,387.38 under terms, a new Facility Contract, will be deemed to have come into existence and superseded the original contractual Facility sums. In all of this, the Plaintiff states that, the 2nd and 3rd Defendants secured the Facilities with their said Landed properties as Mortgagors and also provided personal guarantees, hence their inclusion as 2nd and 3rd Defendants in the suit. This alleged Contract amount of GH₡5,429,387.38 Medium-Term Loan between Plaintiff and 1st Defendant under terms was denied by the Defendants. The question is: Did the Plaintiff grant this latter Medium-Term Loan Facility to the 1st Defendant? This is an issue not only because of the Defendants denial of the grant but because same is deemed then to represents the foundation of the principal claim, the Plaintiff endorsed on its Writ of Summons. The Plaintiff set upon itself and rightly so, the task to proof that, it granted this Facility to the 1st Defendant and that, it is the breach of the 1st Defendant to meet its obligation of repayment under the Medium-Term Loan, that has resulted in the recovery of the alleged Principal Sum of GH₡18,936,525.36 endorsed on the Writ of Summons. 3 Evidence adduced by the Plaintiff and its Evaluation. The Plaintiff opened its case, on 7th November, 2022, per its representative, one Mary Magdalene Poku. On 25th January, 2023, the Court adopted as the Evidence- In-Chief of the Plaintiff the following Witness Statements. 1. The Witness Statement and the attached Exhibits filed on 14th July, 2021. 2. The Supplementary Witness Statement together with the Exhibits filed on 29th September, 2021. 3. The further Supplementary Witness Statement and Exhibits filed on 25th February, 2022. 4. The further Supplementary Witness Statement and Exhibits filed on 26th May, 2022. 5. The further Supplementary Witness Statement without Exhibit(s) filed on 20th June, 2022. 6. The further Supplementary Witness Statement and Exhibits filed on 24th January, 2023. The Witness testified that, she will not rely on Exhibits “A”, “G(2)”, “H”, “H(1)” and “N” attached to the Witness Statement filed on 14th July, 2021. That she will rely on Exhibits "A", “G”, “G(2)”, “L”, “L(1)”, “M” and “N” as attached specifically to the further Supplementary Witness Statement filed on 24th January, 2023, in place of any such documents as found unstamped in the proceedings. 4 Now, back to the issue of the Medium-Term Loan Contract under terms being GH₡5,429,387.38. The Plaintiff tendered Exhibit “G(2)” to proof this claim of Medium-Term Loan. The Medium-Term Loan as already noted is stated to be GH₡5,429,387.38. The Plaintiff stated at paragraph 8 of the Statement of Claim that, the grant of the Loan was by a Facility Letter. Exhibit “G(2)” is the Facility Letter. It is dated 11th May, 2018. In Exhibit “K”, the alleged Medium-Term Loan is posted to have been granted on 10th August, 2018. Exhibit "K" is the 1st Defendant’s Account. That is what Plaintiff relies to proof the grant to 1st Defendant of the alleged Medium-Term Loan. The question is: If in Exhibit “A” dated 26th September, 2016, the 1st Defendant was granted GH₡ 6,000,000.00 Term Loan, how did the said balance of the GH₡6,000,000.00 came to be GH₡2,429,387.38. The further question is that, if in Exhibit "A", the 1st Defendant was given an Overdraft of GH₡10,000,000.00 stated to have been renewed at paragraph 6 of the Statement of Claim, how did that, also become GH₡3,000,000.00. The Court struggles to find how between the date of Exhibit “A” and the grant of the Facilities thereof on 26th September, 2016, the balance of the GH₡6,000,000.00 and the said unutilised Overdraft of GH₡3,000,000.00 consummated to GH₡5,429,387.38. Exhibit "K" does not show the alleged GH₡2,429,387.38 and the alleged GH₡3,000,000.00. It is the Court’s finding in the face of the absence of proof of 5 these amounts, that, the Medium-Term Loan was a manipulation of 1st Defendant's Account. Continuing with the analysis of the Plaintiff’s task of proving the latter contractual Medium-Term Loan of GH₡5,429,387.38, the Court observes however, in passing, the following: At paragraph 9 of the Statement of Claim, the Plaintiff told the Court, in pleading that, the Medium-Term Loan of GH₡5,429,387.38 is for a tenor of 36 months at an Interest Rate of 28.61% per annum. In pleading, the Plaintiff informed the Court that, the 1st Defendant has a longer period of 36 months to pay the Loan and at a smaller Interest Rate of 28.61%. When Plaintiff had to bring evidence to proof exactly what it had told the Court above, the evidence as per Exhibit “G(2)” was different in terms of the tenor and the Interest Rate. Instead of the shorter tenor of 12 months, the Plaintiff stated the tenor to be 36 months and an Interest Rate of a bigger figure of 31.5% per annum. This means, the Plaintiff imposed on the 1st Defendant a shorter period of 12 months to pay the Loan and a higher Interest Rate of 31.5% rather than 28.61% per annum. The evidence of the Plaintiff in the Witness Box is clearly in the opposite direction, in legal parlance, at variance with its pleading. The Law is trite that, a party must not be allowed or permitted to bring evidence to Court contrary to the parties pleadings. See Dam v J. K. Addo & Brothers [1962] 2 GLR, 200. 6 It is for such showing supra, that, the Court stated earlier that, the importance of pleadings cannot be over emphasised and that, it is the foundation of the suit. That is what evidence must be brought to proof. It is what gives the other party an idea of the nature of the claim or defence he is to face. Suffice to say that, the above is merely an observation of the Court. The 1st and 2nd Defendants have challenged the said indebtedness of GH₡18,936,525.36. In their Defence and Counter-Claim, they tell the Court to make an Order for an Account of this figure or for same to be gone into, to determine, 1st Defendant’s actual indebtedness. The Court appointed the Regional Accountant of the Judicial Service, Ashanti Region, Kumasi as Court Expert to provide an opinion to the Court on the actual indebtedness of the 1st Defendant. The Plaintiff on one hand and the 1st and 2nd Defendants on the other submitted their respective documents to the Court Expert towards the ascertainment of the actual outstanding debt of the 1st Defendant. The Court Expert filed his Report on 25th November, 2024. He was cross-examined by Counsel for 1st and 2nd Defendants on the Report. Learned Counsel for Plaintiff did not cross-examine the Expert. On the issue of the Interest Rate, the Expert testified on 5th December, 2024, under Cross-Examination by Counsel for 1st and 2nd Defendants as follows: 7 “Q: On the face of the Audit Report, tell the Court the Interest Rate that was used by you in arriving at the alleged outstanding balance of GH₡18,936,525.36? A: My Lord, the Interest Rate is 31.5% per annum.” The Court has examined the findings and conclusions made by the Court Expert. No where in the findings and conclusions did the Court Expert wrote what he said in the Witness Box about applying an Interest Rate of 31.5% per annum or any other figure at all. So, without factoring an Interest Rate exigible on the alleged Medium-Term Loan of GH₡5,429,387.38, how could the Court Expert say that, he had arrived at the actual indebtedness of the 1st Defendant in the sum of GH₡18,936,525.36. The Court Expert concluded that, the 1st Defendant’s indebtedness is GH₡18,893,471.47 rather than the GH₡18,936,525.36 in the Writ of Summons. He attributed the difference between the figure in the Writ and his lower figure to be as a result of charges that, Plaintiff ought not to have made against 1st Defendant. The Court finds the Report of the Court Expert unreliable by reason that, his claim, to have applied an Interest Rate of 31.5% does not exist in his findings and conclusions. The Court Expert never wrote in his report that, he applied 31.5% Interest to the alleged Medium-Term Loan. The Court therefore reject his opinion on the actual indebtedness of the 1st Defendant. The law is trite that, his opinion is not binding on the Court. 8 So, how did the Medium-Term Loan of GH₡5,429,387.38 transformed to the GH₡18,936,525.36 being claimed in the Writ of Summons as 1st Defendant's indebtedness and for that matter 2nd and 3rd Defendants. At page 84 of 89 of Exhibit “K”, the alleged Medium-Term Loan as already stated, is posted on 10th August, 2018. The Plaintiff at paragraph 15 of the Statement of Claim says that, the 1st Defendant’s indebtedness alleged to be GH₡18,936,525.36 was so as at 14th December, 2018. The question under interrogation still is: where is the evidence that, from 10th August, 2018, assuming the balances of the GH₡6,000,000.00 Loan and the unutilised GH₡10,000,000.00 Overdraft alleged to be GH₡5,429,387.38 suffered repayment such that, same left an alleged indebtedness of GH₡18,936,525.36 as at 14th December, 2018. At page 85 of 89 in Exhibit “K”, the transaction dates therein in December, 2018, are 3rd, 10th and 31st. The question again is where is 14th December, 2018, at page 85 of 89 since after 31st December, 2018, the transaction dates that follows are all in 2019. The Court finds as follows: 1) That the Plaintiff failed to proof the alleged Loan Balance of GH₡2,429,387.38 and the alleged GH₡3,000,000.00 as an unutilised Overdraft. 2) That by reason of Plaintiff's failure to proof finding (1) above, the Court further finds that, Plaintiff failed to provide evidence of the alleged Medium-Term Loan and that, the posting of GH₡5,429,387.38 was a manipulation of the 1st Defendant’s Account, Exhibit “K”. 9 3) That Exhibit “K”, the 1st Defendant’s Account did not provide proof that, there is a Transaction Date of 14th December, 2018, as pleaded at paragraph 15 of the Statement of Claim and further that, the 1st Defendant’s indebtedness amounted to GH₡18,936,525.36. 4) That the Plaintiff failed to proof the build up of the said indebtedness from 11th May, 2018, of Exhibit “G” to the non-existent transaction date on page 85 of 89 in Exhibit "K". The Court finds that, the Plaintiff has failed to proof its Principal Claim amount in the Writ of Summons. The Plaintiff cannot succeed in this circumstance. Having failed to proof its Principal Claim in the Writ of Summons, the ancillary reliefs also falls in their entirety. Plaintiff’s action is dismissed on the basis, solely, on the findings four (4) findings supra. The 1st Defendant did not proof its Counter-Claim and same is also dismissed. The Court cannot make 2nd and 3rd Defendants liable to Plaintiff based on the Mortgage Contract and the Contract of Guarantee, on the dismissal of the Plaintiff's claim. Consequentially, the Court orders the Plaintiff to surrender forthwith all the Mortgage Documents of the 2nd and 3rd Defendants in its possession or custody to them. No costs is awarded in this Judgment. (SGD.) H/L JUSTICE CHARLES KWESI BENTUM 10 (JUSTICE OF THE HIGH COURT) LEGAL REPRESENTATION: A. S. N. Nkansah holding the brief of Sammani M. Zachary for the Plaintiff. Diana Bempong Marfo holding the brief of K. Boye Ateng for the 1st and 2nd Defendants. Daniel B. Bewel for the 3rd Defendant. 11