ENI GHANA EXPLORATION AND PRODUCTION LIMITED VRS VITOL UPSTREAM GHANA LIMITED (H1/91/2022) [2023] GHACA 158 (29 June 2023)

IN THE SUPERIOR COURT OF JUDICATURE IN THE COURT OF APPEAL ACCRA. A. D. 2023 CORAM: JUSTICE HENRY KWOFIE (MR.) J. A. (PRESIDING) JUSTICE J. BARTELS-KODWO (MRS.) J. A. JUSTICE KWEKU T. ACKAAH-BOAFO (MR.) J. A SUIT NO: H1/91/2022 DATE: 29TH JUNE, 2023 SPRINGFIELD EXPLORATION AND PRODUCTION LTD --------- Plaintiff/Respondent VERSUS 1. ENI GHANA EXPLORATION AND PRODUCTION LIMITED ------- 1st Defendant/Appellant. 2. VITOL UPSTREAM GHANA LIMITED ----- 2nd Defendant/Respondent __________________________________________________________ J U D G M E N T __________________________________________________________________ ACKAAH-BOAFO, JA pg. 1 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment i. Overview: [1] This appeal concerns the legal capacity of the Plaintiff, Springfield Exploration and Production Limited as an owner of block(s) for the exploration and production of petroleum products in the West Cape Three Points 2 Block oil fields in the Western Region in respect of the suit it initiated and the reliefs it seeks. Also, at issue is whether the suit issued per the pleadings disclosed a reasonable cause of action. The underlying action in this appeal is one for orders directed at the Defendants to comply with the directive given by the Minister of Energy for the parties to enter into an agreement to develop the accumulation of petroleum in the Sankofa and Afina fields as a single unit. The Plaintiff is also praying for an order directed at the Defendants to render accounts to it for the exploration and production activities in the Plaintiff’s Sankofa fields among other reliefs. [2] Following the issuance of the writ of summons on July 10, 2020 and the service of same on the Defendants, on July 29, 2020 the 1st Defendant, ENI Ghana Exploration and Production Limited filed a motion for an order to dismiss the writ of summons for lack of capacity. On August 12, 2020 the 2nd Defendant, Vitol Upstream Ghana Limited also filed an application to strike out the suit on grounds that the suit disclosed no reasonable cause of action and also that the suit was an abuse of process. On September 3, 2022 the court below dismissed both applications in one composite ruling. [3] Dissatisfied with the ruling of the court below, each Defendant launched an appeal against the ruling and each has been given a separate file number and therefore I shall write a separate decision for each Defendant even though the ruling of the Court below pg. 2 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment is the same. In this ruling, I shall deal with the 1st Defendant’s appeal which is file no H1/91/2022. For ease of reference, the Plaintiff will be referred to in this appeal as Respondent and the 1st Defendant shall be referred to as the Appellant. ii. Background Facts: [4] Before proceeding to deal with the main issue(s) for resolution in this appeal, it is necessary to give the background facts. In doing so, I wish to state that the parties cannot agree on the facts and are engaged in what I term “a contest of the narratives”. Be that as it may, from the Respondent’s pleadings filed that was before the trial judge and the affidavit depositions, the following background facts can be surmised. [5] The Respondent contends that the parties are all owners of blocks for the exploration and production of petroleum products in Ghana. The Respondent contends it acquired its rights pursuant to an agreement it executed with “the Republic of Ghana, GNPC Exploration and Production Company, the Ghana National Petroleum Corporation (GNPC) sometime in the year 2016”. It contends that its contract area is known as the West Cape Three Points 2 Block (WCTP-2) which includes the Afina Field, and the Defendants acquired their rights to the contract area known as the Offshore Cape Three Points Block (OCTP) which includes the Sankofa Field. According to the Respondents the contract areas of the parties share a common boundary and the accumulation of petroleum in its contract area, extend into Defendants’/Appellants’ contract area. [6] The Respondent further contends that the fact that the petroleum products accumulated in its contract area extend into Appellants’ area has been established by GNPC, which is tasked with the responsibility for regulating the petroleum resources of the Republic of Ghana. It is also the case of the Respondent that it is not disputed that the pg. 3 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment petroleum products accumulated in its contract area and that of the Appellants’ contract areas straddle. The Respondent contends that it owns about 54% of the accumulated petroleum products in the straddled areas and the Appellants’ have not provided any contrary facts and/or confronted the GNPC since their attention was drawn to that by the GNPC. It is the case of the Respondent that the Defendants’/Appellants have been exploring and producing petroleum products from resources jointly owned by them without accounting to it even though it owns the lion share. [7] As stated above, the Appellant does not agree with the facts stated by the Respondent and contends among others that it has not been established that the Respondent owns 54% of the “purported straddling accumulation”. The Appellant herein further states that it is unfounded for the Respondent to allege that it been established that the accumulation of petroleum in the Afina Discovery extends to the Offshore Cape Three Points Block Contract area (OCTP). According to the Appellant, there is no basis for the Plaintiff to assert that it owns a part of any purported straddling accumulation because the pre-conditions for unitisation have not been established. [8] The Plaintiff/Respondent per the statement of claim contends that as a result of the straddling accumulation, it engaged an internationally recognized expert in the industry known as ERC Equipoise to verify its findings regarding the Appellant’s Sankofa Cenomanian Reservoir extending to its contract area and the expert confirmed its findings that the Appellant’s activities undertaken in the Sankofa Cenomanian Reservoir will affect the Respondent’s rights and petroleum deposits in the WCTP-2. [9] The Respondent avers in the statement of claim that in compliance with the law, the Minister for Energy in consultation with the Petroleum Commission directed the Respondent and the Appellants to enter into an agreement to develop and produce the pg. 4 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment accumulation of petroleum straddling their respective contract areas, as a single unit. According to the Respondent, the parties were directed to have the “Unitization of the Sankofa and Afina Fields”. The Plaintiff/Respondent says it was constrained to institute the action that has birthed this appeal because the Defendants/Appellants deliberately refused to comply with the Minister’s directive made pursuant to the provisions of Section 34 of Petroleum Exploration Act, 2018, Act 919. [10] As earlier stated, the 1st Defendant/Appellant herein filed an application to dismiss the suit on the grounds that the Plaintiff/Respondent did not have capacity to institute the action. The grounds for the application were that; “a. the Plaintiff lacks the capacity to institute the present action to enforce the directive issued by the Minister of Energy for the unitisation of the Sankofa and Afina Fields; and b. that in the absence of a contract, the Plaintiff does not have a legal right in the exploration, development, production or revenue accruing from the Sankofa Field, and thus, the Plaintiff lacks the capacity to seek reliefs relating to proceeds or revenue from the Sankofa Fields”. iii. The Grounds of Appeal: [11] The Commercial Division of the High Court per its ruling dated September 3, 2020 dismissed the application. The ruling is at pages 329 – 349 of the Record of Appeal (ROA). The Appellant filed the instant appeal on September 16, 2020. The Notice Appeal is at pages 350 – 354 of the ROA. The grounds of appeal filed are as follows: “(a) The learned trial judge erred in law when she failed to determine the preliminary objection to the capacity of the Respondent to institute the substantive action. Particulars pg. 5 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment i. ii. The learned judge erroneously equated Respondent’s capacity to sue in the present suit to the legal existence of Respondent as one and the same. The learned judge erroneously held that the failure of the Appellant to challenge the existence of Respondent meant that it had capacity to bring the action before the Honourable Court. iii. The learned judge erred when she maintained that notwithstanding the clear procedure set out in section 34 of the Petroleum (Exploration and Production) Act, 2016 (Act 919) and the provisions of the Petroleum (Exploration and Production) (General) Regulations, 2018 (L. I. 2359), the Respondent had a common law right to institute the present action. (b) The learned trial judge erred in law when she held that the Plaintiff has a right to make a legal claim or seek judicial enforcement of the duty or right to unitization, because the petroleum from the Contract Areas is produced from a common reservoir without any proof whatsoever. Particulars i. The learned judge erroneously held that the Plaintiff has a right at common law which could have been maintained even in the absence of any statutory right under section 34 of the Petroleum (Exploration and Production) Act, 2016 (Act 919). (c) The learned judge erroneously held that the parties are statutorily required to enter into an agreement to develop and produce the accumulation of petroleum as a single unit without satisfying the requirement under section 34 of the Petroleum (Exploration and Production) Act, 2016 (Act 919). pg. 6 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment (d) Learned trial judge misdirected herself on the nature and effect of the Minister’s duty under section 34 of the Petroleum (Exploration and Production) Act, 2016 (Act 919). Particulars i. The learned judge failed to hold that the Plaintiff did not have a right to sue, considering the clear mandate of the Minister under the Petroleum (Exploration and Production) Act, 2016 (Act 919). ii. The learned judge failed to hold that the Plaintiff did not have a right to sue considering the clear procedure set out under regulation 50 of the Petroleum (Exploration and Production) (General) Regulations, 2018 (L. I 2359) for execution of unitisation agreements. iii. The learned judge failed to hold that the Plaintiff did not have a right to sue since it had not been alleged or proven by the Plaintiff that the Minister had failed and/or neglected to perform his duty under the Petroleum (Exploration and Production) Act, 2016 (Act 919) and Petroleum (Exploration and Production) (General) Regulations, 2018 (L. I. 2359) (e) The learned trial judge misdirected herself on the nature and effect of the reliefs sought by the Respondent in its Writ of Summons and Statement of Claim. Particulars i. The learned judge failed to recognize that the other reliefs being sought by the Respondent derive from relief (i) endorsed on the Writ of Summons and for which reason the Respondent was not clothed with the capacity/standing in law to institute the present suit. pg. 7 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment (f) The Ruling of the trial judge is against the weight of the evidence on record. iv. Issue for Determination & Submission of Counsel: [12] My Lords, despite the numerous grounds of appeal filed by the Appellant, I am of the respectful view that stripped of the legalese and lengthy argument contained in the over 60 pages of submissions filed by Counsel, the main issue for determination is a simple one: whether or not the learned trial judge erred or misdirected herself on the law in determining the Appellant’s contention that the Respondent lacked capacity to institute the action based on the two-pronged argument stated in the motion paper and set out above at paragraph 10 of this judgment. That is what we are called upon to determine and which will dispose of this appeal. v. Appellant’s Submission: [13] Counsel for the Appellant submitted that the learned Judge erroneously equated the Respondent’s capacity to sue to the legal existence of the Respondent as one and the same. According to Counsel, capacity with regards to instituting an action may be considered in two senses, being “the legal existence of an entity, and the legal right of an entity to commence an action (locus standi)”. He further submitted that, on the issue of capacity, the Appellant raised in the court below “was whether or not the Respondent had the legal right (locus standi) to institute the substantive action based on the Minister’s directives”. In the view of Counsel, the learned Judge “in an attempt to resolve the issue erroneously misapplied the principles on the legal right of the Respondent to institute the substantive action and concluded that the Respondent is a legal entity and such, has the capacity to sue”. pg. 8 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment [14] According to Counsel, the fact that the Respondent is a legal entity incorporated under the laws of Ghana does not mean that the Respondent has the legal right (locus standi) to institute any action it deems fit and therefore the Respondent did not have the legal right (locus standi) to institute the substantive action. Counsel submitted that by challenging the capacity of the Respondent, the validity of the writ was in issue and the “court cannot proceed to hear the merits of the Respondent’s case until the Respondent who is challenged proves that it has the requisite capacity to maintain the present action”.1 [15] Counsel further submitted that the learned Judge erred when she held that the Appellant did not challenge the legal right of the Respondent to institute the action because the Appellant did. According to Counsel the judge erred in holding that the Respondent has capacity to institute the action because “it is trite that the issue of capacity in the form of legal right of a Plaintiff to institute an action goes to the root of the action and that a Plaintiff is required to establish that it has the legal right to sue when the issue is raised”. Counsel cited the case of Fosua & Adu Poku v. Dufie (deceased) and Adu Poku-Mensah,2 to support the submission. In this case, Counsel submitted that the trial Judge erred in holding that the Respondent has capacity to institute the action based on the Minister’s directives. The Appellant contends that the trial Judge misconstrued the issue of capacity before her and “this Honourable Court ought to correct this fundamental error by allowing this instant appeal”. [16] Counsel’s next submission was that “the learned judge erred when she maintained that notwithstanding the clear procedure set out in Section 34 of the Petroleum 1 Republic v H. C. Accra Ex Parte Aryeetey (Ankrah Interested Party) [2003-2004] SC GLR 398 Per Kpegah JSC. 2 (2009) SCGLR 310. pg. 9 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment (Exploration and Production) Act, 2016 (Act 919) and the provisions of the Petroleum (Exploration and Production) (General) Regulations, 2018 (L. I. 2359), the Respondent had a common law right to institute the present action”. According to Counsel, it was erroneous for the trial judge to hold that the Respondent has a common law right to be protected based on the correlative rights principle. [17] The Appellant’s further submission was that the learned judge misrepresented and misapplied the effect and essence of a unitisation directive and the correlative rights principle. Counsel submitted that the correlative rights principle is inapplicable in Ghanaian legal jurisprudence, and therefore the learned Judge’s reliance on same to hold that the Respondent has a common law right to institute the substantive action is erroneous and wrong in law. According to Counsel, apart from the fact that the correlative right principle is not applicable in Ghana, “the correlative rights principle also operates on the assumption that there is a lawful ascertainment by the requisite authority that a petroleum accumulation has straddled two fields, and hydrocarbons can migrate from one field into the other field”. In this case, Counsel submitted that it has not been “definitively concluded and lawfully established that the petroleum deposits in the Afina Discovery had indeed straddled to the Sankofa Oil Field”. [18] Another argument advanced by Appellant’s Counsel was that the learned judge wrongly concluded that the Respondent’s right to a fair share of the petroleum from the “purported common reservoir is protected without satisfying herself that the requirements under section 34 of the Petroleum (Exploration and Production) Act, 2016 (Act 919) had been met”. According to Appellant’s Counsel, the learned Judge erred in law when she failed to consider Act 919 as a whole and Regulation 50 of the Petroleum (Exploration and Production) (General) Regulations, 2018 (L. I. 2359) to determine if the Respondent has the capacity to institute the substantive action”. pg. 10 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment [19] Counsel’s further submission is that even if the Minister’s purported unitization directives have not been complied with, it is not the Respondent who should sue to enforce it but the Minister alone who is empowered by law to seek the intervention of High Court to enforce the terms and conditions of his unitization directive. Counsel submitted that it is the Minister who is clothed with the authority or capacity to enforce the unitization directives pursuant to Section 34(1) of Act 919 and Regulation 50(6) of L. I. 2359 (if lawfully made). [20] Counsel continued that “My Lords, by necessary implication, it is the Attorney- General who can maintain an action on behalf of the State in accordance with Article 88(5) of the 1992 Constitution, and not the Respondent”. Counsel referred to the case of Brown v. Attorney-General,3 and further stated that under Article 88(5) it is the “Attorney- General who shall be responsible for the institution and conduct of all civil cases on behalf of the state; and all civil proceedings against the state shall be instituted against the Attorney-General as defendant.” Based on the above submissions and the others contained in the 60-page written submission together with the 17 page reply by which arguments were made on unitization and correlative rights principle in Ghana, counsel prayed the Court to allow the appeal. vi. Respondent’s Counsel’s Submission: [21] Counsel in his written submission set out the case at the court below, the application filed by the Appellant, the response by the Respondent and the ruling of the court before responding to the arguments by the Appellant in this appeal. Respondent submits that the grounds of appeal filed are contrary to the rules of court as they are couched in a narrative and argumentative manner. It is also submitted that the particulars of errors/misdirection stated do not in fact reveal any error or misdirection at all. On the 3 [2010] SCGLR 183 pg. 11 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment appeal itself, as can be expected, it is the position of the Respondent that the instant appeal is without merit and same should be dismissed. [22] The Respondent’s counsel submitted that the Appellant’s contention that the trial judge erroneously considered the capacity argument is misconceived. According to learned counsel, the Appellant just did not appreciate the ruling of the court because the trial Judge noted that the issue for her determination was whether or not the Plaintiff had locus standi in law to commence the suit and succinctly answered the question. Counsel referred to the ruling and stated that the Appellant’s contention that the said determination was not made is untrue. Counsel further submitted that the Appellant’s misapprehension of the ruling of the court below is displayed with its submission that the trial Judge equated the objection to capacity to sue to the legal existence of the Plaintiff. In the view of Counsel, the submission is not true because the court below explained itself very well that nowhere in the ruling did the court equate “the legal existence of Plaintiff to the right of Plaintiff to sue or to commence the present suit”. According to counsel the argument that the Court equated “legal capacity” to the “legal existence” of Plaintiff is a clear example of the Appellant’s “complete misapprehension” of the concept of capacity and locus standi. [23] Counsel next submitted that “capacity deals particularly with whether the person can initiate the action rather than whether the person can maintain a claim which is more of a legal right. Locus standi on the other hand demands that a party must be clothed with some right or interest in the subject of the suit or must be injured or stand to be injured in some way in order to be entitled to the relief against the party”. Counsel referred to this Court the decision in Jacob Kweku Acheampong v Sekyeredumasi Stool4 4 [2019] 130 GMJ 147 pg. 12 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment and the dictum of Adumua Osei JA wherein he explains capacity in the sense of locus standi. Counsel also referred to the Supreme Court decision in the case of Florini Luca, Florini Alesandro v Mr. Samir, D. I. C & Attorney General5 and the statement of law by Pwamang JSC by which he distinguished the two concepts of capacity and locus standi as follows: “Capacity properly so called relates to the juristic persona and competence to sue in a court of law and it becomes an issue where an individual sues not in her own personal right but states a certain capacity on account of which she is proceeding in court. But locus standing relates to the legal interest that a party claims in the subject matter of a suit in court.” [24] Based on the above, Counsel submitted that the court below addressed the issue of capacity and locus standi and therefore the Appellant’s extensive arguments are misplaced. Counsel also submitted that the legal existence of the Respondent herein was not put in question at all and that even if that was the case, the Court below dealt with any suggestion that Plaintiff/Respondent lacks capacity to sue and be sued clearly in the ruling delivered. [25] Responding to the Appellant’s argument that by Section 34 of Act 919 and the provisions of the Petroleum (Exploration and Production) (General) Regulations, 2018 (L. I. 2359) only the Minister for Energy who issued the directive has the capacity to enforce same, learned Counsel for the Respondent submitted that the position of the Appellant is misconceived because a reading of the above provision reveals one relevant factor and which, is the directive of the minister to unitize. According to Counsel the said factor is the straddling of the petroleum accumulation. Consequently, to the extent that 5 Civil Appeal No. J4/49 2020 Judgment is dated the 21st day of April 2020. pg. 13 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment there is a valid directive instructing that the two fields, namely the Sankofa Field and the Afina Field be produced as one, the Respondent herein reserves a right in law, to ensure the protection of its interest in the common reservoir. Counsel further stated that the “right of Plaintiff emanates from the Plaintiff’s undisputed interest in the common reservoir from which 1st Defendant operates its Sankofa field and this is the foundation of Plaintiff’s pleadings in the statement of claim, particularly paragraphs 10 to 28”. [26] Counsel for the Respondent further submitted that the Appellant’s contention that Plaintiff failed to lead evidence to establish that it has locus standi is simplistic because the statement of claim filed “provides the basis of Plaintiff’s standing in law, and consequently, the issue of whether indeed, there is a straddling of the field is a matter determinable at trial. And it is for this reason that the Court below held that: “In opposing the application, the Plaintiff has argued that the Plaintiff’s right to make a legal claim or seek judicial enforcement of the duty or right to the unitization arises from the fact that petroleum produced by Defendants came from a common reservoir. The Plaintiff therefore rightly contends in the view of the Court that it has sufficient interest in the sense of locus standi to institute the proceedings before the court6.” [27] Respondent’s Counsel further submitted that the Respondent has a right to the petroleum being produced from the common reservoir and the funds derived from same by the Defendants in the suit, and can therefore, seek to protect its interest by an interlocutory application in the nature of an injunction or preservation of the funds. According to Counsel, the need to protect each party’s right to the deposits of 6 See page 401 of the record of appeal. pg. 14 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment hydrocarbon in a straddling field is recognized in law. Counsel referred to the US State of Oklahoma Supreme Court decision in the case of Patterson v Stanolind Oil & Gas Co7. Counsel submitted that “Davison J held referring to the decision of the United States Supreme Court in the case of Ohio Oil Co. v. State of Indiana, 177 U. S. 190, 20 S. Ct. 576, 44 L. Ed. 729, that “the right of the owner of land to the oil and gas thereunder is not exclusive but is common to and merely coequal with the rights of other landowners to take from the common source of supply, and therefore that his property rights to said oil and gas are subject to the legislative power to prevent the destruction of the common source of supply. It has already been decided that this police power of the state to prevent the destruction of the common source of supply may be exercised by regulation of the production therefrom.” [28] Based on the above and the other cases referred to, Counsel for the Respondent submitted that “My Lords, the above authorities disclose that Plaintiff has an economic interest and right in the oil exploited by Defendants, and it is on the basis of protecting this economic right and interest of all persons in straddling hydrocarbon depositions that the state polices the exploitation and production of oil and gas by regulation. It is in the protection of this economic right of persons such as Plaintiff that the state in its regulatory power directs the unitization of oil field”. [29] Based on the above submissions together with all the others captured in the 39- page written submission filed, Counsel for the Respondent submitted that the appeal is without merit and bereft of understanding, and therefore prayed that it be dismissed. vi. Applying the Law and Analysis: 7 305 U. S. 376 (1939) SUPREME COURT OF OKLAHOMA pg. 15 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment [30] My Lords, I am of the respectful opinion that the questions raised in this appeal are questions of law and facts, and therefore the standard of review for our consideration is correctness of the application of the law to the facts. I begin by reiterating the point that the Appellant has raised many grounds of appeal including allegations of errors and misdirection, and provided particulars, many of which do not reveal the alleged error or misdirection. Be that as it may, as earlier stated in my opinion the issue is very simple and narrow. It is whether or not, the learned trial Judge erred in her application of the Appellant’s contention that the Respondent lacks capacity to institute the action. [31] The task of answering whether the learned Judge was correct must be informed by the test that governed the applications before her: an application to “dismiss the action for want of capacity”. That, the Respondent lacks capacity to enforce the directive issued by the Minister of Energy and also “in the absence of a contract, the Plaintiff does not have a legal right in the exploration, development, production or revenue accruing from the Sankofa Field, and thus, the Plaintiff lacks capacity to seek reliefs relating to proceeds or revenue from the Sankofa Fields”. [32] In answering and dealing with the question posed in the application, the learned Judge first noted that the Appellant’s application ought to have properly invoked the jurisdiction of the Court in accordance with the rules of the Court and not fall on the “inherent jurisdiction for specific orders without clarity” [See page 330 of the ROA]. It is noted that the Appellant did not state on the face of the application that it was pursuant to the inherent jurisdiction. That notwithstanding, the Court considered the application on the merits. The Court below noted that despite the “procedural glitches”, it shall consider the merits of the application because it “raises the fundamental issue of capacity” and consequently did so. pg. 16 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment [33] The Court below noted that the essence of the application before the Court was that the issue of capacity to sue or to defend was crucial and its determination was essential. The court also stated that the sole issue to be determined by the application was whether the Plaintiff has the legal capacity to maintain the suit before the court. The learned trial judge stated that capacity is paramount and referred to the Supreme Court case of Standard Bank Offshore Trust Co. Ltd vs National Investment Bank Limited & 2 others [2017-2018] 1 SCGLR 707 to state that “a person’s capacity to sue, whether under a statute or rule of practice, must be found to be present and valid before the issuance of the Writ of Summons, else the Writ will be declared a nullity” [See page 335 of the ROA]. [34] My Lords, it was necessary for the court to deal with the issue of capacity once it was raised because the law is that when a party lacks capacity, the Court ought not to deal with the merits of the case. Indeed, the law is also settled and it is cadit quaestio that, when a party’s capacity is challenged the said party ought to prove same with cogent evidence. That position of law was affirmed in the case of Sarkodee I v. Boateng II [1982- 1983] GLR 715, when the court held that “It was elementary that a Plaintiff or Petitioner whose capacity was put in issue must establish it by cogent evidence. And it was no answer for a party whose capacity to initiate proceedings had been challenged by his adversary, to plead that he should be given a hearing on the merits because he had a cast-iron case against his opponent.” [Emphasis Mine]. [35] Now, what is capacity? The Merriam-Webster online dictionary has a number of definitions of the noun “Capacity” including “legal competency or fitness” and “duty, position, role”. Examples given to illustrate include “He was acting in his capacity as judge; he was serving in a supervisory capacity.” In the book Locus Standi pg. 17 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment – A Commentary on the Law of Standing in Canada (Toronto: Carswell, 1986) at 3, Thomas A. Cromwell, a former Professor of law at Dalhousie University, in Halifax, Nova Scotia, Canada and a retired Justice of the Supreme Court of Canada, states that “problems of capacity to sue typically involve questions about whether the party is a ‘legal person’, that is one having the general right to commence or defend proceedings”. The learned jurist observed and stated as follows: “But capacity to sue may be distinguished from standing. Capacity has been defined as “the power to acquire and exercise legal rights.” In the context of the capacity of parties to sue and be sued, to say that a party lacks such capacity is to acknowledge the existence of some procedural bar to that party’s participation in the proceedings – “one that is personal to a party … and imposed by law for one or more of various reasons of policy usually quite divorced from the substantive merits….” [36] Professor Cromwell further states the essential difference between the legal capacity and standing as follows: The distinction between capacity and standing is that capacity generally depends on the personal characteristics of the party divorced from the merits of the proceeding or the nature of the question in issue in it. It concerns the right to initiate or defend legal proceedings generally. Standing is concerned with the appropriateness of the court’s dealing with the particular issue presented at the instance of the particular plaintiff. It is more concerned with the nature of the issue and the context in which it is raised than with the personal characteristics such as age, mental capacity, etc., of the plaintiff. A party may have capacity to sue but lack standing. [p. 3] pg. 18 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment [37] From the above, it is my respectful opinion that legal capacity to initiate an action and continue with same refers to the Plaintiff’s status as a legal person. Capacity is not about the role of a party in the proceeding but to the party’s personal characteristics or status while standing is part of the larger subject of entitlement to seek judicial relief before a court of competent jurisdiction. Standing involves the acknowledgement of one’s right to come before the court to argue that his or her right has been violated or threatened to be violated or to enforce an unfulfilled legal obligation. Put in another way, standing involves the determination of whether or not a person has sufficient stake in the outcome of a matter to enable the one set in motion the judicial process. See Professor Hogg observation in Constitutional Law of Canada (3rd ed. 1992), at p. 1263. [38] To reiterate, the Appellant contends that the trial Judge erroneously misapplied the principles on the legal right of the Respondent to institute the substantive action and concluded that the Respondent is a legal entity and such, has the capacity to sue. But, is the Appellant’s critique of the learned judge justifiable? In my view, it is not because the Judge properly and clearly applied the law and set out the difference between “Capacity” and “Locus Standi”. At page 341 of the ROA, the Court stated that “capacity is also defined as a legal personae (a natural or juristic person) that is capable of vindicating, asserting, or defending a right. Locus standi or standing, on the other hand, is a party’s right to make a legal claim or seek judicial enforcement of a duty or right. It demands that a party must be clothed with some right or interest in the subject of the suit or must be injured or stand to be injured in some way in order to be entitled to relief against the party sued. In other words, a cause of action must be disclosed”. [38] At pages 339 to 340 of the ROA, the trial Judge further stated: “On the first ground, the 1st Defendant contends that the Plaintiff lacks capacity to invoke the jurisdiction of the Court for an order directing the Defendants to pg. 19 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment comply with the Minister’s directive contained in the Minister’s letter of 9th May 2020. The Plaintiff contests the 1st Defendant’s submission on capacity with quite interesting technical arguments. The court notes, as contended by the Plaintiff that the capacity issues raised by the application before the Court do not challenge the Plaintiff’s existence as a limited liability”. [39] The Judge followed the above up with a discussion of the Plaintiff’s arguments on capacity and locus standi and stated at page 341 of the ROA that; “The Court therefore finds that the substance of the 1st Defendant’s first ground in the application deals with locus standi and not capacity in the sense of legal competence to invoke the jurisdiction of the Court. This finding is incontrovertible when account is taken of the fact that in the affidavit in support of the application before the Court, the 1st Defendant does not make any depositions, which remotely suggest that it challenges the Plaintiff’s existence as a legal entity”. [40] The trial Judge then analysed Section 34 of Act 919 and stated at page 343 of the ROA that the key objective of the provision is to prevent waste and protection of correlative rights where accumulation of petroleum extends beyond the boundaries of one contract area to another. Having distilled the above as the objective of Section 34, the Court further stated “to the extent that the Plaintiff and Defendants are statutorily required to “enter into an agreement to develop and produce the accumulation of petroleum as a single unit”, there can be no doubt as the Plaintiff contends, that its right to a fair share of petroleum from the common reservoir is protected”. [41] Now, having set out the law on capacity and locus standi and referring same to the objective of Section 34 of Act 919, the Court stated at page 438 of the ROA that the Plaintiff had locus standi to institute the action to vindicate its right based on Act 919 as follows: pg. 20 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment “The case before the Court is simply that the exploration and production activities carried out on the Defendants Sankofa Field automatically affects the petroleum accumulation in the Plaintiff’s contract area by depleting it. The Court’s position is that the Plaintiff has locus standi and has a course of action requiring interrogation and determination by the Court.” [42] To my mind, it is quite clear from the above that the grounds of appeal by which the Appellant claims the trial Judge erred and misdirected herself on the law are all misconceived and without merit. The trial judge did not equate the Respondent’s capacity to sue to its existence; neither did she err when she held that the Respondent has a right to make a legal claim to enforce its rights. The Appellant’s contentions are rather baffling because in the thinking of this Court, the learned trial Judge dealt with the issue of capacity raised in the application aptly and succinctly based on the law. [43] My Lords, the above is clearly sufficient to deal with the appeal based on the statement made at paragraph 12 supra that the main issue is whether the Court erred when it considered the issue of capacity raised despite the numerous grounds of appeal. I however, deem it appropriate to speak to one of the grounds of appeal raised and to discuss same briefly. The Appellant stated as “B” of the Grounds of Appeal as follows: “The learned trial judge erred in law when she held that the Plaintiff has a right to make a legal claim or seek judicial enforcement of the duty or right to unitization, because the petroleum from the Contract Areas is produced from a common reservoir without any proof whatsoever” [Emphasis Mine]. [44] Submitting in support of the above, Counsel first criticised the trial judge that she erroneously equated the common law correlative rights principle to vest the Respondent with capacity when she stated at page 344 of the ROA that; pg. 21 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment “In the context of the application before the Court, the Plaintiff’s case is based on the theory of correlative rights, which the Plaintiff has the right to enforce. The Plaintiff therefore, has locus standi to institute the present proceedings. Having so held, it follows that the 1st Defendant’s first ground of capacity, which contends that it is only the Minister who has locus standi to take proceedings in the circumstances presented by this suit is unsustainable.” In the view of Counsel, the Judge erred in law and ought to be reversed because “purported unitisation directive and the common law correlative rights principle do not lead to an accrual of the capacity to institute the substantive action for unitisation”. [45] Counsel next argued by submitting that the law requires the Respondent to successfully discharge the burden of proving its capacity to institute the substantive action. The Respondent woefully failed to provide any proof to that effect. [Emphasis Mine]. My Lords, I find the submission of Counsel to be problematic and a contradiction in terms because of how he invoked the Court’s jurisdiction and invited the Court to deal with the capacity issue. In fact, I see no merit in this submission because I do not understand how the Appellant expected the Respondent to provide proof of its capacity in some other way other than the affidavit filed to oppose the application. [46] The settled rule of law is that the capacity of a party to mount an action may be challenged at any time, and even on appeal. The case, Yorkwa v Duah (1992-93) GBR 278 C/A illustrates the principle that where a person’s capacity to initiate an action was in issue it is no answer to give him a hearing on its merits even if he had a cast-iron case. The case of Sarkodee I v. Boateng II Supra also established the principle that when a party’s capacity is challenged the party ought to prove same with “cogent evidence”. pg. 22 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment [47] In Republic v. High Court, Accra, Ex Parte Aryeetey (Ankrah Interested Party), [2003-2004] SCGLR 398 the Supreme Court per Kpegah JSC also stated that any challenge to capacity puts the validity of a writ in issue. The apex Court after analyzing the West African Court of Appeal (WACA) decision in Sokpui II v. Agbozo III (1951) 13 WACA 241 stated at page 405 of the report as follows: “… whether a person who has been sued in a representative capacity, indeed, has the capacity he claims to have or not, is a question of fact; and if challenged, he must prove same to avoid his suit being dismissed”. [Emphasis Mine]. [48] From the above, it can be deduced that capacity is a question of fact and when a party’s capacity is challenged, he or she must prove same with cogent evidence. In this appeal, the evidence establishes that the Appellant after being served with the Writ of Summons, entered appearance and filed an application for the dismissal of the suit on grounds that the Plaintiff does not have capacity. The Appellant did not file a defence to the suit and has still not filed one. In effect, it invited the court to determine the suit based on affidavit evidence. The Court based its decision on the affidavit evidence and the only pleading before it, being the statement of claim. The Appellant, ironically, now complains that the Respondent “woefully failed to provide any proof” of its capacity. The question to be asked is how did the Appellant expect the Respondent to provide proof when it has reduced the litigation to a battle of affidavits? [49] To confirm the challenge with the Appellant’s approach, I note that in the 17-page reply submission filed in this appeal, the Appellant disputes certain facts stated by the Respondent in the submission filed. At page 5, a section is headed “Misstated Facts”. Under it, the Appellant’s Counsel submits that the Respondent is deliberately attempting to mislead the Court because “it is completely unfounded for the Respondent to allege that it has been established that the accumulation of petroleum in the Afina Discovery pg. 23 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment extends into OCTP”. Counsel also states that “the Appellant further submits that it has not been established that the Respondent owns 54% of the purported straddling accumulation” etcetera [Emphasis Mine]. To my mind, these facts show that the Appellant ought to have filed a statement of defence to set out its contentions because these are facts that can only be established through oral evidence and possible tendering of documents and not by the affidavits filed. In this case, I am of the view that the Appellant short-circuited the process by inviting the Court to determine the contesting facts by the two contrasting affidavits filed. That, to my mind was wrong. [50] My Lords, the Appellant’s approach, by which a party without filing a defence files an application to pray the court to dismiss suit on the grounds that the Plaintiff has no capacity (which is a legal defence) is a practice which is gradually becoming a trend in our litigation process, and ought to be deprecated. My view is that procedural law requires that in challenging a party’s capacity, save situations where it is patently clear either from the endorsement of the writ or it is manifestly clear from the pleadings, the challenge that a party does not have capacity ought to be well articulated and established in a statement of defence so that it could be set out as a preliminary matter to be determined by the court either through legal argument or some form of evidence taking. As stated above, the onus is always on a party whose capacity is challenged to prove affirmatively that it has same, but proving same should not be anchored in a contested application such as the instant matter. vii. Conclusion & Disposition: [51] Finally, I note that the Appellant also stated the omnibus ground as ground (f) of the notice of appeal. In arguing the ground, counsel cited many cases which establish the same principle and basically rehashed the arguments made under the different grounds of appeal, which I have stated elsewhere in this judgement as unnecessary. On this pg. 24 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment ground of appeal, the authorities are many and they include such cases as Tuakwa vs. Bosom (2001-2002) SCGLR 61 which affirm the law that when an Appellant raises the omnibus ground of appeal, it is the duty of the Appellant to point out in a very clear and succinct manner to the appellate court, the pieces of evidence on record which were ignored or overlooked by the trial court and which, if applied correctly, would have caused judgment to be entered in his favour. [52] This position was clarified by the Supreme Court when it stated in Olivia Anim v. William Dzandzi (Unreported) Suit Number Civil Appeal No. J4/10/2018 delivered on the 6th June 2019 that: “Where an appeal is based on the ground that the judgment is against the weight of evidence, the Appellant implies that there were certain pieces of evidence on record which if applied in his favour could have changed the decision in his favour or pieces of evidence were wrongly applied against him. The onus is on such an Appellant to clearly and properly demonstrate to the appellate court the lapses in the judgment being appealed against.” In effect, from the authorities, this Court, being an Appellate Court, is duty bound, by virtue of the main ground of appeal herein stated, to examine the record as a whole in order to establish whether or not the conclusion reached by the trial Judge is correct having regard to the evidence adduced by the parties. [53] Having reviewed the ROA and in particular the ruling of the trial Judge, I am of the respectful view that her conclusion that “nowhere does the 1st Defendant say that the Plaintiff has no capacity to acquire and exercise legal rights” and her conclusion that the “Plaintiff has locus standi and has a course of action requiring interrogation and determination by the Court” are all based on her analysis of the law and anchored in the evidence contained in the ROA. Indeed, in support of her conclusion that the Plaintiff has locus pg. 25 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment standi and that some of its petroleum interest may migrate into the contractual area of the Appellant, the trial judge stated at page 345 of the ROA as follows: “It is the Plaintiff, which assumes the burden of proof of these assertions at the appropriate time. The Court takes the view that if the Plaintiff is able to prove that indeed some of the petroleum produced by the 1st Defendant in its Sankofa field come from the Plaintiff’s Afina field, no court of justice will say that the Plaintiff is entitled to no relief at all. The Plaintiff therefore has a major interest in ensuring that the statutory purpose of Section 34 of Act 919 is achieved”. [54] There are other findings made by the trial judge to show why in her view the Respondent herein has an interest and standing in this matter. Based on these facts, I see no justifiable reason why the Court below could have ruled that Plaintiff/Respondent has no capacity to commence the action. There is no evidence that the Respondent is precluded from enforcing its own right pursuant to Section 34 of Act 919 as held by the court below. The ruling was never against the weight of evidence as contended by the Appellant and no justifiable legal arguments have been made in this appeal to support the numerous grounds of appeal for me to come to a different conclusion. The reasons and conclusions of the court below are to my mind correct and same are to be affirmed. In the end, the appeal is dismissed in its entirety as one without merit. Costs of GH¢20,000.00 awarded in favour of Respondent against the Appellant. SGD. ………………………… JUSTICE KWEKU T. ACKAAH-BOAFO (JUSTICE OF THE COURT OF APPEAL) pg. 26 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment SGD. I AGREE ……………………………. JUSTICE HENRY KWOFIE (JUSTICE OF THE COURT OF APPEAL) SGD. I ALSO AGREE ………………………………. JUSTICE JANAPARE BARTELS-KODWO (JUSTICE OF THE COURT OF APPEAL) COUNSEL: DANSO AMOAH WITH EZEKIEL CODJOE FOR 1ST DEFENDANT/APPELLANT DAVID ADU-TUTU JNR WITH JENNIFER TWENEBOAH-KODUA FOR 2ND DEFENDANT/APPELLANT NOELA GBIREH PORVI FOR PLAINTIFF/RESPONDENT pg. 27 Springfield v. ENI Ghana Exploration – Suit No. H1/91/2022 - Judgment