NDK FINANCIAL SERVICES LTD VRS. AHWIRENG (GJ/0039/2021) [2024] GHAHC 118 (10 April 2024)

IN THE SUPERIOR COURT OF JUDICATURE, IN THE HIGH COURT OF JUSTICE (GENERAL JURISDICTION, THREE (3)) ACCRA HELD ON WEDNESDAY THE 10TH DAY OF APRIL, 2024 BEFORE HIS LORDSHIP JUSTICE PATRICK BAAYEH (J) TIME: 11:29AM SUIT NO. GJ/0039/2021 NDK FINANCIAL SERVICES LTD - PLAINTIFF VRS. JOYCE AHWIRENG - DEFENDANT PARTIES: EDWARD ASAFU ADJAYE REPRESENTS PLAINTIFF LEGAL REPRESENTATION: EMMANUELLA DOWUONA HOLDING BRIEF FOR O.K OSAFO-BUABENG FOR PLAINTIFF DEFENDANT ABSENT NO LEGAL REPRESENTATION FOR DEFENDANT JUDGMENT The Plaintiff instituted this action against the Defendant on 13th October, 2020 claiming the following reliefs. a. Recovery of the sum of GH¢127,901.63 being the balance outstanding on Defendant’s loan account as at 30th September, 2020. b. Interest on the said sum at the contractual interest rate of 5% per mensem from 1st October, 2020 to date of final payment. c. Default charge of 3% of the balance outstanding. 1 | P a g e d. An order that 2nd Defendant pays the Plaintiff’s legal fees. The Defendant duly entered appearance and filed her Defence per lawyer. At the close of pleadings, the issues adopted for trial are; 1. Whether or not the Defendant owes the Plaintiff the sum of GH¢127,901.13. 2. Whether or not following the sale of the vehicle, the Defendant still owes the Plaintiff. 3. Whether or not the Defendant paid GH¢35,000 of the purchase price. 4. Whether or not the Defendant is entitled to a refund of the aforesaid GH¢35,000.00. After application for directions on 8th July, 2021, the parties were ordered to file their Witness Statements, pretrial check list and any documents they intend to rely on at the trial. The Plaintiff duly filed its Witness Statement but Defendant failed to file. Then on 28th March, 2022, counsel for the Defendant moved a motion for leave to withdraw his representation of the Defendant which was granted. Thereafter Defendant has failed to participate in all aspects of the case. Not only did she fail to file her Witness Statement, she also failed to attend court. Several hearing notices were served on her by Substituted Service but in spite of proof that these were duly served including using her mobile phone number, Defendant failed to participate in the trial. Eventually, the Plaintiff gave evidence without the Defendant. Even after Plaintiff’s evidence, hearing notice was again served on Defendant to appear and cross examine Plaintiff’s witness but once again she failed to do so. The case of the Plaintiff, as can be deduced from its pleadings is that, it is a non-banking financial institution and a limited liability company and authorized by the Bank of Ghana to provide loans and credit facilities to its customers. That the Defendant applied for and was granted a 2 | P a g e loan facility of GH¢80,000 to complete payment for a KIA Sorento vehicle. The loan was approved for the Defendant on 30th May, 2018 for twelve months commencing 30th May, 2018 and to expire on 31st May, 2019. The loan agreement executed between the parties provided for a compound interest of 5% per month and a default charge of 3% on the outstanding balance due on the loan facility upon default. The Defendant used the KIA Sorento 2014 model as security for the repayment of the loan which vehicle was registered in Plaintiff’s name but Defendant had possession. The loan agreement also provided that Defendant would pay GH¢9,100 per moth toward the liquidation of the loan. The Defendant however failed to make the monthly repayment to the extent that as at 7th November, 2018, Defendant had not paid a single pesewa which prompted the Plaintiff to issue a demand notice to her but she failed to pay. Several cheques issued by the Defendant to Plaintiff towards the repayment bounced and were returned unpaid. It is Plaintiff’s case that due to Defendant’s prolonged default Plaintiff eventually sold the KIA Sorento vehicle which was used as security for repayment in March 2019 and realized an amount of GH¢75,000 from the sale. Plaintiff says the sale of the vehicle did not fully liquidate Defendant’s indebtedness. That as at 31st January, 2019, the Defendant’s debt stood at GH¢119,467.13. thus the sale of the vehicle reduced the Defendant’s debt to GH¢44,467.13 as at 1st March, 2019. Plaintiff says following the sale of the vehicle, the Defendant presented two cheques of GH¢9,100 each on 29th April, 2019 and 31st May, 2019 but both cheques were dishonored. It is Plaintiff’s case that same for the proceeds from the sale of the vehicle, the Defendant has not paid any other money towards the liquidation of the loan facility which continue to attract 3 | P a g e interest at the contractual rate of 5% per month. That as at 30th September, 2020, the outstanding balance of Defendant’s loan was GH¢127,901.63. In her Defence, the Defendant denied owing the Plaintiff the sum of GH¢127,901.63. Defendant averred that the loan was contracted solely for the purchase of the KIA Sorento vehicle. Defendant says she and the Plaintiff negotiated with the owner of the vehicle or the consignee for the purchase price of GH¢95,000 out of which she (the Defendant) deposited the sum of GH¢35,000 and Plaintiff paid GH¢60,000 direct to the consignee of the vehicle. Thus, the actual loan granted her by the Plaintiff was GH¢60,000 and not GH¢80,000 as claimed by Plaintiff. It is the Defendant’s contention that the proceeds from the sale of the vehicle ought to have been enough to liquidate the full amount of the loan since the Plaintiff was aware that the vehicle was valued at GH¢95,000. The Defendant therefore counterclaimed for the following reliefs; a. Recovery of GH¢35,000 being part payment of the total cost of the vehicle b. Interest on the GH¢35,000 at the prevailing interest rate. c. Payment of legal fees and other expenses incurred by Defendant in defending the suit. As I stated earlier, counsel for the Defendant applied to the court and was granted leave to withdraw his representation for the Defendant on 28th March, 2022. The record shows that following the withdrawal of her lawyer, the Defendant asked for time to engage another lawyer on 7th July, 2022 and file a Witness Statement. Then on 24th November, 2022, the Defendant was in court with one Livingstone Ameevor Esq., who informed the court that he had just been engaged by the Defendant and needed time to study the case and file the necessary processes. After this date, Defendant was represented by one Patience Mills on 15th 4 | P a g e February, 2023 and on 29th March, 2023. No lawyer appeal for the Defendant after the 7th July, 2022 and the Defendant failed to file a Witness Statement. Consequently, on 2nd May, 2023, in the presence of Defendant’s representative, Patience Mills, the Plaintiff’s witness mounted the witness box and tendered her Witness Statement which was adopted as her evidence in chief together with Plaintiff’s exhibits. The case was adjourned to 9th May, 2023 for Defendant to cross examine the Plaintiff’s witness but she failed to appear and in spite of several hearing notices served on her. She still failed to come to court. Consequently, pursuant to Order 36 Rule 1 of the High Court, (Civil Procedure) Rules 2004, C.I 47, the Defendant’s counter claim was dismissed. Before I proceed to analyze the evidence adduced by the Plaintiff in support of its case or statement of fact, I shall refer to the law and consider the burden of proof in civil cases. The General Principle of law has been captured in the proposition “he who asserts must proof”. This proposition of law was restated in the celebrated case of ZABRAMA VRS. SEGBEDZIE (1991) 2 GLR 221 at P. 226 where Kpega JA (as he then was) said; “ A person who makes an averment or assertion which is denied by the opponent has a burden to establish that, that assertion is true. And he does not discharge that burden unless he leads admissible and credible evidence from which the fact or facts he asserts can properly and safely be inferred. The nature of each averment or assertion determined the degree and nature of the burden”. To the same effect is Section 11,12 and 14 of the Evidence Act, (1975) NRCD 323 and the case of ABABIO VRS AKWASI III (1994-95) BGR 774 where the supreme court reiterated the position in ZABRAMA VRS. SEGBEDZIE (SUPRA) and held that; 5 | P a g e “ a party whose pleadings raise an issue essential to the success of the case assumes the burden of proving such issue. The burden only shifts to the Defendant when the Plaintiff has adduced evidence to establish his claim”. SEE ALSO ADWUBENG VRS DOMFEH (1996-97) SCGLR 728. Thus Section 11 (4) of the Evidence Act (1975) NRCD 323 puts the obligation in Civil proceedings on a party who asserts to produce “sufficient evidence so that on all the evidence a reasonable mind could conclude that the existence of the fact was more probable than its non-existence” In this judgment since Defendant failed to participate in the trial, I only have Plaintiff’s evidence to go by, even though Defendant’s statement of Defence may be referred to when it becomes necessary. The main issue to be determined is whether or not the Defendant is indebted to the Plaintiff in the sum of GH¢127,901.63. From Exhibit 1 dated 10th May, 2018, Defendant applied for a loan at GH¢80,000 for “twelve (12) month to enable me complete payment for a KIA Sorento (2014) car being purchased and to augment working capital”. This loan application was granted to Defendant. The loan application was approved on 30th May, 2018 for twelve (12) months commencing 30th May, 2018 to 31st May, 2019 at an interest rate of 5% per months. Among the terms of the loan facility which was signed by the Defendant personally was processing fee of GH¢ 2,400. Apart from the interest of 5% per month, the agreement also provided that “Any interest amount which remains unpaid at the end of the month shall be added to the principal and the consolidated balance outstanding (i.e. principal and interest) shall attract interest at the rate of 5% per month….”. 6 | P a g e The Defendant agreed to pay monthly at the rate of GH¢9,100.00 but for five months Defendant paid nothing which necessitated plaintiff to seize Defendant’s KIA Sorento vehicle which was used as collateral and which was in fact registered in Plaintiff’s name. The car was sold and an amount of GH¢75,000 realized was used to defray part of the Defendant’s debt. Defendant has pleaded that she deposited an amount of GH¢35,000.00 to which the Plaintiff added Gh¢60,000 to make a total of GH¢95,000.00 which was the purchase price of the KIA Sorento vehicle and for that matter she did not take a loan Of GH¢80,000.00 from Plaintiff. However, Exhibit B1 is the “facility Agreement” between the parties which was signed by Defendant herself. Exhibit B1 states at clause 4.0 that; “ the lender shall make available to the borrower as loan facility an amount of eighty thousand Ghana cedis (GH¢80,000) on the execution of these presents and the borrower hereby acknowledges receipt of he said amount”. In her evidence Plaintiff’s witness gave a breakdown of how the GH¢80,000.00 was disbursed. That; 1. The loan attracted a processing fee of GH¢2,400.00 which was paid upfront i.e deducted from the loan( in accordance with clause 8.1 of the facility agreement (Exhibit B1). 2. The sum of GH¢60,000.00 was paid to Okofo Enterprise, the vendor of the KIA Sorento vehicle. 3. An amount of GH¢5,000.00 was given to Defendant cash to enable her stock her shop (See Exhibit C). 4. An amount of GH¢8,5995.53 was applied to pay off the residual balance for an existing loan facility granted to Defendant in October 2017. This was done with the express 7 | P a g e consent of the Defendant so that she would have one loan facility to service. (See Exhibit D to D6). 5. An amount of GH¢4,004.47 was used to pay comprehensive insurance premium for the KIA Serento vehicle which was used as collateral as well as insurance on goods in Defendant’s shop. When all these are added we arrive at the total sum of GH¢80,000.00 which exactly is the loan amount Defendant signed for. It is clear therefore that even though the GH¢80,000.00 was not handed to Defendant cash, it was all used with her consent and for her benefit. It is Plaintiff’s case that at the time the KIA Sorento vehicle was valued and sold a the cost of GH¢75,000.00, Defendant had defaulted and her indebtedness was GH¢124,910. Thus, the sale of the vehicle for gh¢75,000.00 only reduced Defendant’s indebtedness to GH¢49,910.26 as at 1st March, 2019. Exhibit L series are various communications between Plaintiff and Defendant on valuation and sale of the vehicle and the current debt of the Defendant. Indeed, in Exhibit K headed “notice of sale of vehicle with Registration No. GN 1886-18”, the Plaintiff gave the Defendant enough information and notice of the sale of the vehicle paragraph 5 of Exhibit K states; “ Consequent on the above and as a result of your failure to pay any sum on the facility as demanded above, we hereby inform you that the 2014 KIA Sentro with registration No. GN 1886-18 you assigned to us as security for the facility shall be sold for a price of GH¢75,000 and the proceeds used to settle your indebtedness in part. As you will notice, the above purchase price represents the forced sale value of the vehicle…………. 8 | P a g e “ Accordingly, we hereby offer you the opportunity to pay off your indebtedness to us in full not later than March 1, 2019 failing which we shall be compelled to dispose off, the vehicle at the above-mentioned price of GH¢75,000………” In the face of all these information available to Defendant, it would be unrealistic for Defendant to state in her statement of Defence that the vehicle had a value of GH¢95,000 and its sale was enough to pay off her debt to Plaintiff and even leave a balance of GH¢35,000.00 for her. It is true that Plaintiff bought the vehicle for GH¢95,000.00 in May, 2018 but that cannot be its value at the time of sale in march, 2019. More especially when the vehicle was valued by professional valuers (Trust Logistics ltd) TTL. As I have indicated elsewhere in this delivery after applying the purchase price of the vehicle (GH¢75,000) for the payment to defendant’s indebtedness, made up of capital, interest and penalty GH¢127,901.63 as at 30th September, 2020. Thus, for the proceeds from the sale of the KIA vehicle which was offered as collateral, the Defendant has not paid a pesewa of the loan she contracted on 30th may, 2019. Since the Defendant failed to participate in the trial, she disabled herself from contradicting Plaintiff’s evidence. In the circumstances, I enter judgment for Plaintiff in the sum of GH¢127,901.63. I also granted Plaintiff interest on the above sum at the current commercial bank rate from 30th September, 2020 till date of final payment. I award cost of GH¢20,000.00 for Plaintiff. JUSTICE PATRICK BAAYEH (J) (JUSTICE OF THE HIGH COURT) (SGD.) COUNSEL 9 | P a g e EMMANUELLA DOWUONA HOLDING BRIEF FOR O.K OSAFO-BUABENG FOR PLAINTIFF 10 | P a g e