SIERRA ENGINEERING SERV. LTD VRS. BEIJING ZHONGRUI XINDA CONST. CO. LTD AND ANOTHER (C11/106/23) [2025] GHACC 18 (20 February 2025)

IN THE CIRCUIT COURT “A”, TEMA, HELD ON THURSDAY, THE 20TH DAY OF FEBRUARY, 2025, BEFORE HER LADYSHIP JUSTICE AGNES OPOKU-BARNIEH, ADDITIONAL CIRCUIT COURT JUDGE SUIT NO. C11/106/23 SIERRA ENGINEERING SERV. LTD ---- PLAINTIFF VRS. BEIJING ZHONGRUI XINDA CONST. CO. LTD. —- 1ST DEFENDANT SENTUO OIL REFINERY CO. LTD. ---- 2ND DEFENDANT PLAINTIFF CO. REP. BY FRANCIS Y. NYAMADI (M.D.) PRESENT DEFENDANTS ABSENT PAUL SELORM KPODOVIA, ESQ. HOLDING THE BRIEF OF MODESTO KPODOVIA, ESQ. FOR THE PLAINTIFF PRESENT ISAAC EMMANUEL BLANKSON, ESQ. HOLDING THE BRIEF OF KWASI BLAY, ESQ. FOR THE DEFENDANTS PRESENT JUDGMENT FACTS: The plaintiff caused a writ of summons with an accompanying statement of claim to be issued against the defendants on 2nd February, 2023, praying this Court for the following reliefs; (a) Recovery of the amount of Two Hundred and Fifty-Four Thousand, Two Hundred and Fifty Ghana cedis (GH₵254,250.00) being the outstanding amount from the work executed prior to termination of the contract. (b) Recovery of the amount of One Hundred and Thirty Thousand Ghana Cedis (GH₵130,000.00) being special damages for mobilisation and demobilisation of equipment and machines to and from the project site, including workers' recruitment cost for work on site. 1 (c) Interest on claims (a) and (b) at the prevailing Bank of Ghana exchange rate from the 11th day of November 2022 till the date of final payment. (d) Damages for breach of contract. (e) General Damages. (f) Punitive costs, including legal fees THE PLAINTIFF’S CASE The plaintiff, Sierra Engineering Services Ltd, is a limited liability company incorporated under the laws of Ghana, engaged in piping installation, fabrications, welding, onsite installation, pump equipment installation, vessel installations and many others. The plaintiff described the first defendant as a Chinese limited liability construction company with its registered office located in Tema and the second defendant as a limited liability company registered under the laws of Ghana. The plaintiff contends that it was subcontracted by the first defendant to perform piping, fabrication and installation works on a refinery project owned by the second defendant in Tema, Ghana. The plaintiff asserts that on 3rd October, 2022, the first defendant engaged the plaintiff to begin work on 8th October, 2022. Although the first defendant initially proposed a payment rate of GH¢20 per dia-inch, the plaintiff rejected this. The first defendant assured the plaintiff that the rate would be discussed and finalised later, so the plaintiff proceeded with mobilisation. The plaintiff recruited and mobilised 25 skilled workers including engineers, welders and pipe-fitters and transported equipment and machinery to the site. Despite repeated requests, the first defendant failed to provide a formal written contract assuring the plaintiff that it was merely a formality. The plaintiff avers that it later discovered that the first defendant was supplying pre- fabricated pipes, reducing the total dia-inch measurement for which it could charge, resulting in financial losses. Due to these issues the plaintiff paused work but the first 2 defendant promised to review the unit prices. Eventually, the dia-inch price was revised to GH¢40, GH¢30 for valves and GH¢20 for pipe support installations. Additionally, the plaintiff states that it continued work despite reservations about the absence of a proper written contract. However on 11th November, 2022, the first defendant suddenly instructed the plaintiff to stop work and remove its equipment from the site without providing any reason. The plaintiff later found that the first defendant had unilaterally calculated and paid only GH¢19,970 whilst the actual work done was valued at GH¢191,920. Additionally, the plaintiff incurred GH¢130,000 in mobilisation and demobilisation costs, making its total claim GH¢254,250. The plaintiff insists that the first defendant being a foreign company duly engaged by the second defendant to execute its work, the second defendant is legally liable for the acts of the first defendant company since an official search at the Registrar General’s Department of Ghana revealed that the first defendant is not registered in Ghana. The plaintiff argues that the second defendant was aware of its involvement, as its officers frequently visited the site to inspect the work. A formal demand letter was served on the second defendant, but it did not respond. The plaintiff therefore seeks payment for outstanding work, damages for breach of contract and legal costs. THE DEFENDANTS’ DEFENCE The first defendant, Beijing Zhongrui Xinda Construction Co. Ltd, denies most of the plaintiff’s claims, arguing that it subcontracted multiple companies including the plaintiff to perform specific fabrication and installation tasks on the refinery project. The plaintiff was never promised a contract revision and was fully aware that the agreed rate was GH¢20 per dia-inch, similar to what other subcontractors were paid. The plaintiff voluntarily accepted this rate and mobilised to the site. 3 The plaintiff’s work was unsatisfactory and its method of calculating the dia-inch, differed from the industry standard used by other subcontractors. The plaintiff and other subcontractors staged a two-day protest over pricing, which disrupted the project. After this protest, the first defendant agreed to increase the dia-inch price to GH¢40 but the plaintiff refused to sign the revised contract and insisted on being paid in dollars. The plaintiff stopped working on 11th November, 2022, after refusing to sign the contract. It voluntarily removed its equipment from the site, contrary to its claim of wrongful termination. The first defendant asserts that the plaintiff’s claim of GH¢254,250 is unsubstantiated. The plaintiff was paid fairly based on the work done before leaving the site. The first defendant argues that the plaintiff has no legitimate claim and that the case should be dismissed. The second defendant, Sentuo Oil Refinery Ltd, on its part, argues that it contracted the first defendant as an independent contractor to execute the refinery project. The plaintiff was engaged by the first defendant without the second defendant’s involvement or consent. It had no contractual relationship with the plaintiff and, therefore, has been improperly joined to the suit and the dispute between the plaintiff and the first defendant does not involve the second defendant and should be disjoined since it is not liable to the plaintiff. At the application for directions stage, the court set down the following issues for determination; LEGAL ISSUES 1. Whether or not the first defendant's termination of the agreement it had with the plaintiff amounts to a breach of the contract. 4 2. Is the dia-inch calculation by circumference per internationally approved practice? 3. Whether or not the defendants owe the plaintiff an amount of GH₵254,250.00 being an outstanding amount for work executed by the plaintiff. 4. Whether or not the first defendant owes the plaintiff an amount of GH₵130,000.00 being special damages? 5. Whether or not the 2nd defendant, as the entity that subcontracted the project to the first defendant, is liable for the indebtedness of the first defendant. 6. Any other issues arising out of the pleadings. The lawyers filed their respective addresses on 17th January 2025 and 31st January 2025, respectively. Learned Counsel for the defendants in his written address raised and addressed the court on the capacity of the first defendant to be sued in a court in Ghana not being a registered entity and whether the second defendant is vicariously liable to the plaintiff. He argues that these issues on the pleadings and the evidence are dispositive and relies on the cases of Armah v. Hydradoam Estates (Gh) Ltd [2013- 2014] 2SCGLR 1551 and Fattal v. Wolley [2013-2014] 2SCGLR 1070 on the resolution of dispositive issues other than issues set down by the court. BURDEN OF PROOF The burden of proof in civil cases is provided for under Sections 11, 12 and 14 of the Evidence Act, 1975 (NRCD 323). It is trite learning that in civil cases, the party who raises issues essential to the success of his claim generally assumes the burden of proof, and the standard of proof in all civil cases is on a preponderance of probabilities only. The Supreme Court in the case of Sumaila Bielbiel (No.3) v. Adamu Dramani & Attorney-General [2012] 1 SCGLR 370, Date -Bah JSC (as he then was ) clearly made a distinction between the burden of leading evidence and the burden of persuasion when he stated at page 371 as follows; “The distinction between the two burdens of proof, namely the “burden of persuasion” as defined in section 10(1) and the “burden of producing evidence” as defined in 5 section 11(1) of the same Act, is important because the incidence of the burden of producing evidence can lead to a defendant acquiring the right to begin leading evidence in a trial, even though the burden of persuasion remains on the plaintiff. Ordinarily the burden of persuasion lies on the same party as bears the Burden of producing evidence” Also, in the case of In re Presidential Election Petition (No.4) Akuffo-Addo & V. Mahama & Ors [2013] SCGLR (Special Edition), the Supreme Court held at page 322 of the report as follows; “Our understanding of the rules in the Evidence Decree, 1975 NRCD 323 on the burden of proof is that in assessing the balance of probabilities, all the evidence, be it that if the plaintiff, or the defendant, must be considered and the party in whose favour the balance tilts is the person whose case is more probable of the rival versions and deserving of a favourable verdict.” ANALYSIS ISSUE 1: Whether or not the 1st defendant, not being a registered entity, can be sued. It is trite learning that the issue of capacity is fundamental and goes to the root of the action and that a party will not be heard on the merits of his case unless he satisfies the court that he is clothed with the requisite capacity to commence the action or to defend the suit. Also, the issue of capacity can be raised for the first time even on appeal. Once the issue of capacity is raised, the case against the first defendant cannot be determined on the merit until the challenge to capacity is determined. In the case of Kowus Motors v. Check Point Ghana Ltd [2009] SCGLR 230, at page 233 that “ It is settled law that the test for the validity of the institution of an action, as far as capacity of a party is concerned, is whether the party exists…It is obvious that a court must be satisfied that the parties appearing as suitors before it, did exist as legal personae whether human in form or artificially created. In the latter class of cases, the 6 court must see whether the legal indices that constitute the clothing really adorn a legally acceptable fictional character, permitting it access to the courts.” A cardinal principle ingrained in our legal system is the separate legal personality principle which gives a company after its registration, all the powers of a natural person to do all that a legal person will do, subject to limits imposed by the Companies Act and its regulation. This also gives a registered company the power to sue and be sued, to owe and be owed legal liabilities. See the case of Morkor V. Kuma (East Coast Fisheries Case) [1998 - 99] SCGLR 620. The plaintiff in his statement of claim, described the first defendant as a Chinese limited construction company with its registered office located at Tema. The defendants in paragraph 2 of the statement of defence admitted this fact. Learned Counsel for the defendants in his written address argues that the first defendant, an unregistered entity as shown by the plaintiff’s own evidence, cannot sue and be sued. Sections 14 and 15 of the Companies Act 2019 (Act 992) require the Registrar in assessing an application for incorporation, to certify under seal that the company is incorporated and the certificate of incorporation or a certified copy of it is conclusive evidence that the company has been duly incorporated. Under Section 329 of Act 992, an external company is defined as “is a body corporate formed outside the Republic which, has an established place of business in the country.” Such a company does not need to be incorporated in Ghana but is required to register in Ghana. Under Act 992, the expression “established place of business” means a branch, management, share, transfer, or registration office, factory, mine, or any other fixed place of business, but does not include an agency. An external company does not have a separate legal personality from the parent company. 7 In the case of NAOS Holding Inc. v. Ghana Commercial Bank [2005-2006] SCGLR 407, Ghana Commerical Bank (GCB) challenged NAOS Holding Inc.’s existence, arguing that it was not a recognised entity in Ghana or Panama. A company search in Ghana found no record of NAOS Holding Inc. The High Court ruled that NOAS Holding Inc. failed to prove its legal existence and dismissed the case, which was affirmed by the Court of Appeal. On a further appeal to the Supreme Court, the Court per Akuffo JSC (as she then was) held that: “Once its legal status was challenged and its corporate capacity was placed into issue, it was incumbent upon the Appellant to produce more cogent evidence of its existence (such as its registered address or a copy of its certificate of incorporation) to satisfy the court that it has the requisite legal capacity to sue. Since it failed to do so, the court was justified in arriving at the conclusion that the Appellant did not exist.” The need for incorporation and registration was further underscored in the case of Sanyo Electric Trading Co vs. Quarcoopome [2003] DLCA1265, [2001-2002] 2 GLR 198 CA, Accra per Asiamah JA held that: “As a general rule a person domiciled in a contracting state shall, whatever his nationality, be sued in the courts of that state. The domicile of the plaintiff in such cases is usually irrelevant. A legal person is said to be domiciled in a state if it has its seat in that state or country, that is to say, if either (a) it was incorporated in that state or country and has its registered office therein; or (b) its central management or control is exercised there. It is trite learning that mere physical presence is not sufficient. The defendant must be actually domiciled in the state or country for any legal action instituted against it to be maintainable jurisdictionally…In fine, it is the view of our lordships that the defendant, not being a company incorporated and domiciled in Ghana it would be a scandal to the administration of justice if the plaintiff were to be permitted to have his case entertained in our courts. The High Court or, a fortiori any other court in the country has no jurisdiction in the action.” 8 In the instant case, the plaintiff’s representative, Francis Y. Nyamedi (PW1) testified that an official search from the Registrar General’s Department of Ghana revealed that the first defendant company, who was engaged by the second defendant and subcontracted to him, has no records of registration in their system. In support, the plaintiff tendered in evidence Exhibit “K”, the official search results. The results state that: “The company name of the first defendant is not registered in our system as of the time the search was conducted. Kindly provide us with the company’s registration number to enable us to carry out a thorough search”. PW1, under intense cross-examination by Counsel for the defendants, testified as follows; Q: I am suggesting to you that Sentuo Oil Refinery Company engaged the first defendant as subcontractors to the construction of the refinery. A: My Lord, they are the owners of the job and they have awarded the contract to a subcontractor, a Chinese company who have not registered legally in Ghana. Q: Which company has not registered legally in Ghana? A: My Lord, the first defendant company. Q: So from your own mouth, it is not a legal entity? A: According to the Registrar General's Department search conducted and the results show that they have not registered as a company in Ghana under our laws. Q: When did you get this fact that they cannot do business as a company under our laws? A: My Lord, I got the information after I left the site. Q: Did you provide the information they had requested for? 9 A: No, My Lord. Q: So you will agree with me that you were satisfied with the response from the office of the Registrar of Companies as contained in Exhibit “K”? A: Yes My Lord. Q: And that notwithstanding, you went ahead on 2nd February 2023 to file a suit against the first defendant company? A: Yes My Lord. Q: So, in essence, you would agree with me that you filed a suit against the advice of the office of Registrar of Companies? A: No My Lord. There is no evidence before the court from which the court would conclude that the first defendant is incorporated in China or Ghana or registered in Ghana as an external company. It is apparent that the plaintiff did not verify the legal status of the first defendant before entering into a subcontract. A corollary of this is that the first defendant company does not exist and it cannot be sued in the courts of Ghana. The plaintiff did not plead and prove fraud or misrepresentation against the first defendant and the officers of the unregistered company as required under Order 11 rule 8(1) of the High Court Civil (Procedure Rules), 2004 (C.I. 47) for the court to consider whether the first defendant deliberately concealed its unregistered status to induce the plaintiff into a contract. It is trite law that fraud must be specifically pleaded and proved with cogent evidence. The courts do not assume fraud unless there is a clear basis for it in the pleadings. The plaintiff not having sued the officers personally and in the absence of proper pleadings on fraud or misrepresentation, the court cannot impose liability on officers of the first defendant company. 10 Accordingly, the challenge to the capacity of the first defendant to be sued in the courts in Ghana is sustained. The claim against the first defendant is dismissed on the grounds of capacity. It follows naturally that it will be an exercise in futility for the court to determine the matter against the first defendant on the merits. ISSUE 2: Whether or not the 2nd defendant, as the entity that subcontracted the project to the first defendant, is liable for the indebtedness of the first defendant. The principles in Sections 5, 6, and 10 of the Contracts Act, 1960 (Act 25) significantly modify the common law doctrine of privity of contract, which traditionally states that only parties to a contract can enforce its terms or be bound by it. At common law, a third party could not enforce a contract, even if it was intended for their benefit. Section 5 (Provision in a contract for the benefit of a third party) overrides that principle by allowing third parties to enforce contractual provisions meant for their benefit. Section 6 reinforces third-party rights by protecting their interests even if the original contracting parties try to rescind or vary the contract after the third party has relied on it. This limits the contracting parties ’ability to unilaterally alter the third party’s rights. Section 10 also states that consideration need not move from the promisee. Common law requires that consideration must move from the promisee, meaning only someone who provided consideration could enforce a contract. This section abolishes that requirement, allowing a third party to enforce a promise even if they did not personally provide the consideration. The overall effect of these provisions on the doctrine of privity is to weaken the strict common law privity rule by granting third parties enforceable rights in certain exceptional cases. Therefore, generally, there is no direct contractual relationship between the employer and the subcontractor. However, the employer may be liable if the main contract gives rights to the subcontractor, the employer directly promises payment to the subcontractor, or the employer controls the subcontractor’s work, creating an implied 11 contract. Nicholas Gould (Fenwick Elliott) in his paper “Subcontracts’ published at www.fenwickelliot.co.uk, states on pages 1 and 2 that: “There is no direct contractual link between the employer and the sub-contractor by virtue of the main contract. In other words, the main contractor is not the agent of the employer and conversely the employer’s rights and obligations are in respect of the main contractor only. The employer therefore cannot sue the sub-contractor in the event that the sub-contractor’s work is defective, is lacking in quality, or delays the works. On the other hand, the employer is only obliged to pay the main contractor and so sub-contractors cannot sue the employer for the sub-contract price even if the main contractor defaults or becomes insolvent.” The author identifies some exceptions to the general rule of privity of contract at pages 25 and 26 on employers' liability to subcontractors, which are, direct payment, instructions and guarantee. Regarding direct payment from the employer, according to him, this is only available where it is expressly set out in the contract since there is no implied right to payment. See the case of Milestone (JA) & Sons Ltd (in liquidation) v. Yates Castle Brewery Ltd [1938] 2 All ER 439. The second exception identified by Gould is where the employer instructs the subcontractor on how to carry out the work. If the employer instructs the sub-contractor, he may find that he has formed a separate contract based on express or implied promise to pay the sub-contractor. See the case of Dixon v. Hatfield (1825) 2 Bing 439. Thirdly, if the employer guarantees payment, then he will be liable to the subcontractor. Such guarantees must be in writing to be valid. He refers to the case of Actionstrength Ltd (trading as Vital Resources) v International Glass Engineering IN.GL EN Spa, [2003] BLR 207], where the House of Lords held that an oral guarantee was unenforceable because it did not comply with Section 4 of the Statute of Frauds 1677. This conforms to Section 14 of Act 25, which requires all guarantees to be in writing to be valid. 12 The plaintiff’s representative testified that the first defendant by an oral agreement, engaged the plaintiff on 3rd October 2022 to begin work on 8th October 2022 at the second defendant’s refinery project in Tema Industrial Area. According to his testimony, the second defendant, Sentuo Oil Refinery Limited, owns the refinery project and awarded the contract to the first defendant, who then subcontracted the plaintiff. Although the plaintiff’s representative, in imputing liability to the second defendant, testified that the oral agreement was between the plaintiff and the first defendant, he claimed that the second defendant owned the project. He further claims that officials from the second defendant regularly inspected the plaintiff’s work on-site, indicating direct involvement in the execution of the project. The plaintiff informed the second defendant about non-payment issues, but the second defendant failed to intervene or ensure compliance by the first defendant. The plaintiff’s representative further testified that on 28th November 2022, the plaintiff engaged its lawyers to issue a demand notice to the first defendant, copying the second defendant as the project owner. An officer of the second defendant who received the letter assured the plaintiff that the issues surrounding the wrongful termination would be resolved, but nothing was done about it. Also, an official search from the Registrar General's Department revealed that the first defendant was not registered. The second defendant in paragraph 5 of the statement of defence denied knowledge of the subcontract and stated that the plaintiff was independently engaged by the first defendant without prior consent, knowledge and information of the second defendant. The second defendant did not lead evidence at the trial. However, counsel for the defendants effectively cross-examined the plaintiff’s representative on the liability of the second defendant to the plaintiff. PW1 under cross-examination, testified as follows; 13 Q: What are the reliefs you are claiming against the 2nd defendant? A: My Lord, the reliefs are the internationally accepted calculated method and breach of contract. Secondly, is the contract mobilisation cost to site and back. Q: Now, did you have a contract with the 2nd defendant company? A: Yes My Lord. Q: What was the nature of the contract you had with second defendant? A: Quality Assurance of welding and fabrication jobs on site. Q: Was it a written contract between your company and the 2nd defendant company or a refinery? A: No My Lord. Q: Which official of Sentuo Oil Refinery Company did you deal with in this unwritten contract? A: My Lord, I do not know their names but they are supervisors of Sentuo Refinery. Q: Do any of your Exhibits ‘A’ to ‘K’ make reference to Sentuo Oil Refinery Company? A: No My Lord. Q: So you will agree with me that your company did not have any dealings with Sentuo Oil Refinery Company, whom you have named as second defendant? A: My Lord we do. Sentuo is the main contractor and the job owner. They have engineers who supervise technical jobs that we do on site. When the first defendant gives you job they will come to the site and do inspection and they will also give the report verbally. When they find a mistake on the job they can terminate the contract without giving notice. 14 That is the contract I have with them. Quality assurance to make sure the job is done to satisfaction. Q: Do you have what you have told the court by way of explanation in your statement of claim and your witness statement? A: No My Lord. Q: I am therefore suggesting to you that these are afterthoughts. A: No My Lord. The plaintiff’s representative testified during cross-examination that the second defendant owned the job and channelled its rules and regulations through the first defendant in the written contract between the plaintiff and the first defendant. It is noteworthy that the two written contracts, Exhibits “D” and “E”, were not executed by the plaintiff and the first defendant since they failed to agree on the material terms, making them unenforceable. He further testified under rigorous cross-examination that the second defendant instructed him verbally to recreate the walls hence, he had an oral agreement with the second defendant to recreate the walls. Also, the second defendant exercised oversight responsibility over the plaintiff’s work. The witness explained that he excluded these material facts from his witness statement because the plaintiff did not sign a written agreement with the second defendant. The plaintiff’s representative also imputed liability to the second defendant for contracting with an unregistered company. From the evidence led by the plaintiff, there is no evidence that the second defendant played any role in the selection of the plaintiff as a subcontractor; neither was the plaintiff nominated by the second defendant as a subcontractor to the first defendant. Again, there is no written agreement where the second defendant agreed to make direct payment to the subcontractor under the subcontract agreement. The plaintiff, who 15 claims that some officers of the second defendant company issued instructions and inspected the work done by the plaintiff, could not mention the names of the officers who allegedly supervised the project on behalf of the second defendant. The cross- examination reproduced above shows that there is no contractual link between the plaintiff and the second defendant. The second defendant also did not guarantee in writing to pay the plaintiff for work done upon the default of the plaintiff. Thus, the exceptions to the doctrine of privity of contract do not apply in the circumstances of this case. Learned Counsel for the plaintiff in his written address submits that the second defendant is vicariously liable since the first defendant is an employee of the second defendant and the search results show that the first defendant is unregistered. Kofi Kumado in his book, Introduction to the Law of Torts in Ghana states at page 181 as follows; “The vicarious liability principle states that a master is liable for the acts or torts of servants committed in the course of his employment”. The High Court (Commercial Division), presided over by Justice Jennifer Dodoo in the case of Benedicta Quao v. Christian Action Faith Ministry, Suit No. RPC/128/13 delivered on 8th November, 2018, held that, for an employer to be vicariously liable for the actions or torts of his employee, the following must be established: 1. There must exist a relationship of employer and employee. 2. The employee must have committed a tort for which he is always personally liable. 3. The tort must have been committed in the course of the employment of the employee. 16 From the plaintiff’s evidence, he has not shown that the first defendant is an employee of the second defendant. On the evidence, the second defendant is the main contractor who awarded the contract to the first defendant who then subcontracted to the plaintiff. The plaintiff has failed to plead and prove the tort committed by the first defendant and how the principle of vicarious liability applies in a case where the alleged tortfeasor is an independent contractor purporting to be a limited liability company registered in Ghana by merely contracting with it. If the plaintiff claims that the second defendant was also negligent in contracting the first defendant who was not registered in Ghana, this fact should have been pleaded and proved. In the case of Asantekramo @ Kuma v. Attorney General [1975] 1 GLR 319-352, relying on the case Wakelin v. London and South Western Railway Co. (1886) 12 App.Cas. 41 at p. 47, H.L. stated as follows: "Mere allegation or proof that the company were guilty of negligence is altogether irrelevant; they might be guilty of many negligent acts or omissions, which might possibly have occasioned injury to somebody, but had no connection whatever with the injury for which redress is sought, and therefore the plaintiff must allege and prove, not merely that they were negligent, but that their negligence caused or materially contributed to the injury." In the instant case, the claim of the plaintiff against the second defendant is not founded on the tort of negligence. In the instant case, there is no contractual link between the plaintiff and the second defendant. There is no evidence that the second defendant directly promised payment to the plaintiff, even though the plaintiff’s contract was with the first defendant, an unregistered company. The main contract between the second defendant and the first defendant is not before the court to show that the second defendant promised to pay the subcontractor. The plaintiff could not lead sufficient evidence to prove that the second defendant directly controlled and supervised the plaintiff’s work. I therefore hold that the second defendant is not liable to the plaintiff. On the totality of the evidence led, I hold that the plaintiff failed to prove its claim against the second defendant on a balance of probabilities. 17 CONCLUSION On the totality of the evidence led before the court. I hold that the first defendant is not a registered entity in Ghana and cannot be sued in the courts in Ghana. The claim against the first defendant is dismissed on grounds of capacity. The second defendant is also not liable to the plaintiff since there is no nexus contractually between the plaintiff and the second defendant. I therefore dismiss the claim of the plaintiff against the second defendant. COSTS It is trite learning that the award of costs is at the discretion of the Court and must be exercised judiciously. See Article 296 of the 1992 Constitution. Order 74 of the High Court (Civil Procedure) Rules, 2004, CI. 47 and the Practice Directions on Award of Cost, govern the award of costs. See also Tema Oil Refinery v. African Automobile Ltd. [2010] DLCA 6596. The court is also guided by the respective oral submissions made by both lawyers on the issue of costs. Thus, considering the nature of the case, the length of the trial, the number of court sittings, the fact that the defendants did not lead evidence, reasonable expenses incurred by the 2nd defendant in filing court processes, and to provide reasonable remuneration for Counsel for the defendant, I will award an amount of Ten Thousand Ghana Cedis (GH₵10,000) as cost in favour of the 2nd defendant against the plaintiff. No order as to costs for the first defendant which is an unregistered company operating in Ghana with no legal standing before the court since the court cannot award costs in favour of a nonentity. SGD. H/L JUSTICE AGNES OPOKU-BARNIEH (ADDITIONAL CIRCUIT COURT JUDGE) 18