UNIVERSAL MERCHANT BANK LTD vrs ABI CAPITAL FINANCIAL (J4/72/2023) [2025] GHASC 5 (22 January 2025)

UNIVERSAL MERCHANT BANK LTD vrs ABI CAPITAL FINANCIAL (J4/72/2023) [2025] GHASC 5 (22 January 2025)

The 2nd Defendant breached his fiduciary duty by authorising transactions beyond his authority and without Board approval, exposing the Bank to statutory and financial risk. The Plaintiff Bank was entitled to damages for breach of duty and to recover the GHC349,593.75 paid out in the irregular transaction, as the Defendants had actual or constructive knowledge of the irregularity. The 2nd Defendant was afforded fair hearing and his dismissal was lawful; his counterclaim for wrongful termination and damages was dismissed.

Citation
[2025] GHASC 5
Parties
Plaintiff/appellant/respondent/cross Appellant: Universal Merchant Bank Ltd. (formerly Merchant Bank (GH) Ltd.); 1st Defendant: ABI Capital Financial Services Ltd.; 2nd Defendant/respondent/appellant/cross Respondent: Peter Iliasu
Court
Supreme Court
Jurisdiction
Ghana
Judgment Date
22 January 2025
Case Number
J4/72/2023
Procedural Posture
Civil Appeal / Supreme Court Final Judgment
Outcome
2nd Defendant's appeal dismissed; Plaintiff's cross-appeal allowed.
Legal Topics
Fiduciary Duties of Directors, Ultra Vires Acts, Wrongful Termination, Restitution, Corporate Governance, Breach of Contract, Natural Justice, Authority of Company Officers
Source Language
English
Company Law Employment Law Banking Law Fiduciary Duties of Directors Ultra Vires Acts Wrongful Termination Restitution Corporate Governance +3 more

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Parties

Universal Merchant Bank Ltd. (formerly Merchant Bank (GH) Ltd.)

Plaintiff/appellant/respondent/cross Appellant

ABI Capital Financial Services Ltd.

1st Defendant

Peter Iliasu

2nd Defendant/respondent/appellant/cross Respondent

Procedural Posture

Civil Appeal / Supreme Court Final Judgment

Legal Issues

  1. 1 Whether the 2nd Defendant breached his fiduciary duty to the Plaintiff Bank
  2. 2 Whether the Plaintiff is entitled to damages for breach of duty
  3. 3 Whether the Plaintiff is entitled to recovery of GHC349,593.75 from the Defendants

Ratio Decidendi

The 2nd Defendant breached his fiduciary duty by authorising transactions beyond his authority and without Board approval, exposing the Bank to statutory and financial risk. The Plaintiff Bank was entitled to damages for breach of duty and to recover the GHC349,593.75 paid out in the irregular transaction, as the Defendants had actual or constructive knowledge of the irregularity. The 2nd Defendant was afforded fair hearing and his dismissal was lawful; his counterclaim for wrongful termination and damages was dismissed.

Court Disposition

2nd Defendant's appeal dismissed; Plaintiff's cross-appeal allowed.

Orders

  • Defendants jointly and severally to refund GHC349,593.75 to Plaintiff with interest at Bank's lending rate from 21st April 2010 until payment in full.
  • Award of GHC20,000.00 damages to Plaintiff for breach of duty by 2nd Defendant affirmed.