PADDI AND OTHERS VRS. EZZEDINE TRUST COMPANY LTD. AND ANOTHER (GJ/1420/2019) [2024] GHAHC 158 (29 July 2024)

IN THE SUPERIOR COURT OF JUDICATURE IN THE COMMERCIAL DIVISION (COURT 1) OF THE HIGH COURT OF JUSTICE ACCRA, HELD ON MONDAY THE 29TH DAY OF JULY, 2024 BEFORE HER LADYSHIP JUSTICE SHEILA MINTA SUIT NO. GJ/1420/2019 1. PATRICIA ABBAN PADDI 2. DESMOND ABBAN 3. HILDA ABBAN PLAINTIFFS 4. GLORIA OSEI BONSU 5. PAMELA ABBAN OHENE DJAN VRS. 1. EZZEDINE TRUST COMPANY LTD. - DEFENDANTS 2. LANDS COMMISION --------------------------------------------------------------------------------------------------- SUMMARY OF CASE JUDGMENT The Plaintiffs are the beneficiaries of the Estate of the late Godfrey Abban who devised the property subject matter of this dispute to Plaintiffs. Plaintiffs entered into a Joint Venture Agreement with 1st Defendant for the development of Plaintiffs’ property House No. 39, Airport Residential Area, Accra. Plaintiffs executed a sub-lease agreement dated 20th December, 2013 with the 1st Defendant which said agreement was stamped and recorded by the Lands Commission and Numbered AR 873/2014 and stamped as LVD 4420/2014 by the 1st Defendant. Per the terms of the agreement between the parties P a g e 1 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. the 1st Defendant was to make an upfront payment of US$220,000, develop the said property into apartments and hand over six (6) units within twenty-four (24) months from the execution of the agreement. According to the Plaintiffs the parties further agreed that in the event that the apartments were not completed within the agreed period, the 1st Defendant was to pay US$6,000.00 per month to the Plaintiffs. They had no Termination Clause. According to the Plaintiffs, after the execution of the sub-lease the 1st Defendant has had its interest registered at Lands Commission but has till date failed to honour the other covenants of the agreement entered into by the parties which caused the Plaintiffs to issue a Writ against the Defendants on 11th June, 2019. The 2nd Defendant an agency responsible for registration of lands have been joined as a nominal party for the purposes of rectification of its records. The basis of this action is the alleged violation of the contract between the Plaintiffs and the 1st Defendant. The Plaintiffs claimed the following:- 1. Termination of the contract between the Plaintiffs and the 1st Defendant. 2. An order by this Honourable Court requiring the 1st Defendant to pay the outstanding penalty for not completing the project within Twenty-Four (24) months. 3. An order for the rectification of the register at the Lands Commission. 4. General damages. 5. Legal Cost. 6. Any other remedy as the Court may deem fit. There is evidence on the record that the said Writ has been served on both Defendants. The 2nd Defendant entered appearance on 28th June, 2019 but failed to file any other process or participate in further proceedings before the Court. The 1st Defendant did not file any process at all, not even Entry of Appearance after service of processes by P a g e 2 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. substitution. In an application for judgment in default of defence filed by the Plaintiffs there was no response from both Defendants. On 22nd June, 2023, this Court entered Interlocutory Judgment in Default of Defence in favour of the Plaintiffs, not on the merits but missing the timelines regarding pleadings. See Asamoah vrs. Marfo [2011]2 GLR 832. In view of the fact that the Plaintiffs had to lead evidence on matters in their case that require evidence, Plaintiffs then filed their Witness Statements, the final one being by a person who is a relative of the Plaintiffs by name Joel Gregory Abban, who testified before the Court on 28th May, 2024. The Defendants were not present in Court to cross-examine Plaintiffs’ witness having been given the opportunity to do so by service of hearing notice on both Defendants on several occasions by substitution. Exhibits Attached to Plaintiffs’ case In support of Plaintiffs’ case they tendered the following documents:- 1. Exhibit “A” – The will of the late Joseph Godfrey Abban dated 6th December 1989. 2. Exhibit “B” – Vesting Assent dated 15th December 2013. 3. Exhibit “C” – Joint Venture Agreement couched in the nature of a Sub-lease dated 20th December 2013. 4. Exhibit “D” – Letter to 1st Defendant through its CEO dated 18th September 2017. 5. Exhibit “E” – Official search from the Lands Commission dated June 2018. ANALYSIS By the Plaintiffs claim, they are seeking essentially to terminate the agreement between the Plaintiffs and the 1st Defendant among others and against 2nd Defendant, to rectify the record by cancellation of the executed Sub-lease between the Plaintiffs and the 1st Defendant. Per the agreement the 1st Defendant was to be given a sub-lease for forty-five (45) years after payment of some US$220,000.00 upon the execution of the agreement and build apartments on the said property within 24 months for which six (6) units were P a g e 3 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. to be handed over to the Plaintiffs. The agreement had no termination clause and, in the event, that the apartments were not built within 24 months, Plaintiffs became entitled to some US$6,000.00 per month after the expiration of the said 24 months construction period, but not forfeiture of the sub-lease. The Plaintiffs have not denied receiving the US$220,000.00. Per Exhibit “D” Plaintiffs wrote to 1st Defendant on 18th September, 2017 purporting to terminate the agreement for non-performance of some obligations by the 1st Defendant. The said agreement executed on the 20th December, 2013 contained the following terms:- “2.0 TERMS 2.1 This agreement shall commence on the date of its execution, the … day of … 2013 and shall be renewable upon the expiry of the agreed term. 2.2 Construction works shall commence (subject to the Sub-Lessee obtaining the relevant statutory and/or local authority permits by …, or such other subsequent dates as the parties may agree in writing. 2.3 The Sub-Lessee hereby undertakes to complete the Project within twenty (24) months from the date of commencement of construction. 2.4 Should the Sub-Lessee fail to complete the Project within the twenty-four (24) month period stipulated in Clause 2.1 above and handover the six apartments to the Sub-Lessors and this delay is not occasioned by any reasons enumerated in Clause 7.1. below, the Sub-Lessee shall pay the Sub-Lessors the sum of US$6,000.00 (Six thousand United States dollars) for every month that the default shall continue.” Clause 7.1 referenced above is the acceptance delays and force majeure clause. The parties also had a Dispute resolution clause which stated: “9.0 Any dispute arising out of this Agreement that cannot be resolved amicably between the parties within fourteen (14) days after its occurrence shall be referred by the parties herein to mediation failing which the dissatisfied party may refer the P a g e 4 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. dispute to Arbitration under the Alternative Dispute Resolution Act, 2010 (Act 798). By this agreement parties are to resolve their dispute in an escalatory manner, first by mediation and failing that by arbitration. The fact that the 1st Defendant did not appear to raise same does not mean that the Plaintiffs’ right to commence proceedings in Court had accrued. It is rather unfortunate that the matter has had to travel this far for the Court’s attention to be drawn to the Dispute Resolution Clause. Yes, the Defendants failed to show up to defend this suit and the timelines to avoid default judgments against them had passed. The Court however does not grant a Plaintiff all its reliefs merely because the Defendant failed to defend the suit. Pwamang JSC stated in Tei & Anor vrs. Ceiba Intercontinental [2017-2018] 2 SCGLR 906 @ 919 thus:- “It must be remembered that the fact that a Defendant does not appear to contest a case does not mean that the Plaintiff would be granted all that he seeks for by the court.” Upon the registration of an interest in land what does the Land Act say for “Rectification of Record” by the Lands Commission? See Section 195 of Act 1036 which states: “(1) Subject to subsection (2), the Court may order the rectification of the land register by directing that a registration be cancelled or amended where the Court is satisfied that the registration has been obtained or made by fraud, mistake or other vitiating factors. (2) A court shall not order a rectification of the land register, so as to affect the title of a proprietor who has acquired land or an interest in land for valuable consideration unless (a) the omission, mistake, fraud or other vitiating factor was caused by the Lands Commission; (b) the proprietor had knowledge of the omission, mistake, fraud or other vitiating factor in consequence of which the rectification is sought; or P a g e 5 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. (c) the proprietor had caused the omission, mistake, fraud or other vitiating factor or substantially contributed to the omission, fraud, mistake or vitiating factor.” As between the Plaintiffs and the 1st Defendant, has damages been proved by their Witness? Order 11 rule 13(4) of the High Court (Civil Procedure) Rules, 2004 C. I. 47 states that damages shall be deemed to be traversed unless specifically admitted. In view of the escalatory nature of the Dispute Resolution Clause of the Agreement between the Plaintiffs and 1st Defendant, have the Plaintiffs cause of action accrued? See BCM Ghana Limited vrs Ashanti Goldfields Limited [2006] DLSC 6153, where the Supreme stated through Adinyira JSC as she then was that; “The Courts must strive to uphold dispute resolution clauses in agreements, which I consider to be sound business practice”. I don’t think the Plaintiffs have discharged these various burdens on them to entitle them to final judgment. Where per a contractual agreement, the parties agree that a dispute which arises between them should be referred to mediation and upon failure to a domestic tribunal as the initial recourse for the resolution of the dispute, such a provision postpones invocation of the jurisdiction of the Courts. Unlike what pertained in cases under Arbitration Act 1961 (Act 38), the Courts have on their own been given discretion to recognise such an agreement once it comes to its attention and give effect to this. See Section 7(5) of the Alternative Dispute Resolution Act 2010 (Act 798) where it is stated that:- “Where in any action before a court the court realizes that the action is the subject of an arbitration agreement, the court shall stay the proceedings and refer the parties to arbitration.” This provision has been considered in its literal terms by Ackah-Yensu JCS, sitting as addition Court of Appeal judge in CPSC Ghamed Pharmaceutical Limited vrs. Octoglow Ghana Limited [2023] DLCA17143. P a g e 6 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. The clear dispute resolution clause stated above being a contractual term of the agreement between the parties has just been brought to the Court’s attention whiles writing this judgment. The Court had already entered interlocutory judgement in favour of the Plaintiffs against the Defendants when it had not benefited from the Agreement but being now confronted with an escalatory Dispute Resolution Clause including arbitration which sought to postpone the jurisdiction of the Court, is it right to overlook it and enter final judgment for the Plaintiffs? In Republic vrs High Court (Commercial Div.) Tamale Exparte Dakpema, Civil Motion No. J5/6/2015 dated 4th June 2015, it was held per Benin JSC that an interlocutory order made by a Court can be varied by that Court once same is not the subject of a pending appeal. See also the decision of the Court in Attoh-Quarshie vrs Okpote [1973]1 GLR 59 where Hayfrom Benjamin stated as follows:- “If a court, in making a decision, overlooks certain mandatory provisions of the law, it has the inherent power to vacate its own valid orders.” I am minded therefore to vary my order of interlocutory judgment which was given without notice of the existence of the escalatory dispute resolution clause. CONCLUSION In view of the sentiments expressed above relating to the escalatory Dispute Resolution Clause, the absence of evidence regarding the satisfaction of grounds for rectification of record by the Lands Commission as required by the Land Act 1036 and lack of proof of damages, I am unable to enter final judgment for the Plaintiffs. I hereby set aside the interlocutory judgment and order that the matter be pursued as provided in Clause 9 of the Agreement between the Plaintiffs and the 1st Defendant for resolution of their dispute. In view of the attitude of the 1st Defendant, I further order reference of the suit to the Court-Connected ADR for the parties to honour Clause 9 of their Agreement relating to dispute resolution. (SGD.) SHEILA MINTA, J. P a g e 7 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. JUSTICE OF THE HIGH COURT REPRESENTATIONS: PARTIES: ABSENT COUNSEL: KOBINA ENYAN DADSON, ESQ., HOLDING BRIEF FOR JUDE O. Y. ADU AMANKWAH, ESQ., FOR PLAINTIFFS – PRESENT COUNSEL FOR DEFENDANTS ABSENT AUTHORITIES: 1. ASAMOAH VRS. MARFO [2011]2 GLR 832 2. TEI & ANOR VRS. CEIBA INTERCONTINENTAL [2017-2018]2 SCGLR 906 @ 3. BCM GHANA LIMITED VRS ASHANTI GOLDFIEDS LIMITED [2006] DLSC 4. CPSC GHAMED PHARMACEUTICAL LIMITED VRS. OCTOGLOW GHANA LIMTIED [2023] DLCA17143 P a g e 8 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR. 5. REPUBLIC VRS HIGH COURT (COMMERCIAL DIV.) TAMALE EXPARTE DAKPEMA, CIVIL MOTION NO. J5/6/2015 6. ATTOH-QUARSHIE VRS OKPOTE [1973]1 GLR 59 7. HIGH COURT (CIVIL PROCEDURE) RULES, 2004 C. I. 47 8. SECTION 195 OF ACT 1036 P a g e 9 | 9 SUIT NO. GJ/1420/2019 – PATRICIA ABBAN PADDI & 4 ORS. VS. EZZEDINE TRUST LTD. & ANOR.