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HEADNOTES
Practice and Procedure - Appeal
- Special leave - Three-member
panel - Whether
there was a Memorandum of
Understanding (MoU) to become a
shareholder in applicant company
- Whether there was
misrepresention of certain facts
about the real status of the 2nd
as a shareholder -
Whether applicant can cliamh no
more interested in the
acquisition of the shares as
agreed upon in the MoU..
The genesis of this application
is that the respondent entered
into a Memorandum of
Understanding (MoU) with the 1st applicant
on 27th February 2015
to become a shareholder in the 2ndapplicant
company. Based on the MoU, the
respondent, in August 2015, made
a shipment of machinery,
equipment and vehicles from
Angola to the 2nd applicant
in Ghana. However, before the
MoU could be translated into an
agreement between the parties
with regard to the respondent's
actual shareholding in the 2nd applicant/company,
a misunderstanding arose between
the respondent and the 1stapplicant.
The respondent contended that
the 1st applicant had
misrepresented certain facts to
him about the real status of the
2ndapplicant so he
was no more interested in the
acquisition of the shares as
agreed upon in the MoU. On the
17th day of February
2016, the respondent instituted
an action against the applicants
The applicants subsequently
applied to the full bench of the
Court of Appeal per article
138(b) of the Constitution, to
discharge or reverse the order
of the single justice and to
order for stay of execution and
or suspension of enforcement of
same pending the determination
of the appeal before it. The
full bench of the Court of
Appeal refused to discharge the
order made by the single justice
and affirmed his decision.
According to the court, the
applicants did not demonstrate
any exceptional circumstances to
warrant the discharge or
reversal of the single justice’s
order
HELD :-
The nugatory effect alone is not
enough to ground an application
for suspension of enforcement
where an application for stay of
execution is not the appropriate
remedy. In the instant
application before me, the
applicants have not demonstrated
in any way that their appeal
before this Court would be
rendered nugatory upon
succeeding. That apart, they did
not demonstrate any exceptional
circumstance to warrant the
grant of their prayer. Having
failed to satisfy the criterion
for the grant of such
applications, their application
must necessarily fail
STATUTES
REFERRED TO IN JUDGMENT
1992 Constitution article
138(b),
C.I. 16,rule 20(2)
CASES REFERRED TO IN JUDGMENT
Merchant Bank (Gh) Ltd v
Similar Ways Ltd [2012] 1 SCGLR
440.
Standard Chartered Bank
Ltd v Western Hardwoods [2009]
SCGLR 196 and Merchant Bank (Gh)
Ltd v Similar Ways Ltd [2012] 1
SCGLR 440
Merskworld Co. Ltd (No.2)
v Zoomlion (Gh) Ltd (No.2)
[2013-2014] 1 SCGLR 327
Golden Beach Hotels (Gh)
Ltd v Pack Plus International
Ltd [2012] 1 SCGLR 452,
BOOKS REFERRED TO IN JUDGMENT
DELIVERING THE LEADING JUDGMENT
APPAU, JSC
COUNSEL.
STANLEY ADJEI FOR THE
DEFENDANTS/APPELLANTS/APPLICANTS
DANIEL SEGU OSEI FOR THE
PLAINTIFF/RESPONDENT/REPONDEN
RULING
APPAU, JSC:-
The application before me
is for the suspension of the
order of the Court of Appeal
dated 20th July 2016
pending the determination of an
appeal filed against same on 1st
March 2017. The applicants filed
the appeal pursuant to special
leave a three-member panel of
this Court granted them on 23rd
February 2017 after a single
justice of the Court had refused
to do so.
The genesis of this
application is that the
respondent entered into a
Memorandum of Understanding (MoU)
with the 1st
applicant on 27th
February 2015 to become a
shareholder in the 2nd
applicant company. Based on the
MoU, the respondent, in August
2015, made a shipment of
machinery, equipment and
vehicles from Angola to the 2nd
applicant in Ghana. However,
before the MoU could be
translated into an agreement
between the parties with regard
to the respondent's actual
shareholding in the 2nd
applicant/company, a
misunderstanding arose between
the respondent and the 1st
applicant. The respondent
contended that the 1st
applicant had misrepresented
certain facts to him about the
real status of the 2nd
applicant so he was no more
interested in the acquisition of
the shares as agreed upon in the
MoU. On the 17th day
of February 2016, the respondent
instituted an action against the
applicants claiming about six
reliefs. Among the reliefs were:
1.
A declaration that the MoU
dated 27th day of
February was vitiated by the
fraudulent misrepresentation of
the 1st applicant;
2.
A declaration that the
respondent is discharged from
all obligations and/or
liabilities arising from the
said MoU; and
3.
A declaration that the
respondent is the owner of the
equipment and machinery
mentioned in the indorsement of
the writ and an order for the
recovery of same from the
applicants.
Subsequent to the issuance
of the writ of summons, the
respondent applied to the trial
High Court for interim
preservation of the equipment,
machinery and vehicles, in
question. The trial High court,
after hearing from both parties,
granted respondent’s application
for interim preservation to
protect the items from wear and
tear, pending the final
determination of the substantive
matter. This was on the 26th
day of April 2016.
On the very day that the
trial court delivered its
ruling, the applicants filed an
interlocutory appeal against it
to the Court of Appeal. They
then filed a motion for stay of
execution and/or, suspension of
enforcement of the interim
preservation order pending the
hearing of the appeal. The High
court refused to grant the
application. The applicants, in
compliance with the rules,
repeated the application before
the Court of Appeal but the
Court of Appeal, per a single
justice, also refused the
application. The Court of
Appeal, per the single justice,
supported the view of the trial
High court judge that the
ownership of the machinery and
equipment and their value were
in serious contention so the end
of justice would be better
served if same were preserved
pending the hearing of the
substantive suit before the
trial High Court. The applicants
subsequently applied to the full
bench of the Court of Appeal per
article 138(b) of the
Constitution, to discharge or
reverse the order of the single
justice and to order for stay of
execution and or suspension of
enforcement of same pending the
determination of the appeal
before it. The full bench of the
Court of Appeal refused to
discharge the order made by the
single justice and affirmed his
decision. According to the
court, the applicants did not
demonstrate any exceptional
circumstances to warrant the
discharge or reversal of the
single justice’s order.
Aggrieved by the ruling of
the Court of Appeal, the
applicants filed an application
before this Court for special
leave to appeal and for stay of
execution and, or suspension of
enforcement of the Court of
Appeal ruling pending the
determination of the application
for special leave to appeal.
This Court, per Anin-Yeboah, JSC
(sitting as a single justice),
refused the two-pronged
application for special leave to
appeal and suspension of the
ruling of the Court of Appeal as
prayed. The applicants then
filed a reconsideration
application before a
three-member panel of this court
per article 134 (b) of the
Constitution, 1992 praying for
the discharge or reversal of the
single justice’s decision. On 23rd
February 2017, this Court, coram
Adinyira (Mrs.), Dotse and
Benin, JJSC, reversed the
decision of the single justice
dated 4th November
2016 and granted applicants
special leave to appeal with the
order that the appeal be filed
within seven (7) days from the
date of the ruling. The
applicants filed their notice of
appeal on the 1st day
of March 2017. They listed as
many as nine (9) grounds of
appeal. Since my jurisdiction in
this application does not extend
to the determination of the
merits of the appeal before this
court, I prefer to seal my mouth
to making any comments on the
propriety or otherwise of the
said grounds of appeal. In that
wise, I refuse to reproduce them
here.
Having filed their appeal
against the ruling of the Court
of Appeal, the applicants, on
the 8th day of March
2017, filed an application in
the Court of Appeal praying it
to stay execution and/or suspend
the enforcement of its decision
of 20th July 2016,
pending the determination of
their appeal before this Court.
The respondent raised a
preliminary objection to the
application on the ground that
the ruling of the Court of
Appeal was not executable so the
application was incompetent. The
applicants, however, contended
that their application was not
for stay of execution as such,
but was one for the suspension
of the ruling of the court
pending the determination of
their appeal before the Supreme
Court. They referred the Court
of Appeal to the decision of
this Court in Merchant Bank (Gh)
Ltd v Similar Ways Ltd [2012] 1
SCGLR 440. The Court of
Appeal, per Sowah (Mrs.), JA
(sitting as a single justice),
parried the preliminary
objection based on the
clarification made by the
applicants that they were
praying for suspension of the
ruling but not for stay of
execution. She delved into the
substance of the application
before her and refused it on the
ground that the applicants did
not demonstrate any exceptional
circumstances to warrant the
grant of the application. The
applicants applied to the full
bench of the Court of appeal to
reverse or discharge the ruling
of the single justice but the
full bench also refused to do
so. In dismissing the
application, the Court of Appeal
(duly constituted), held as
follows:
“We have read the processes
filed in this application and
have listened to counsel for the
parties. In this application,
the applicant is asking this
court to review the decision of
a single judge of this court
made on 21st March,
2017. That decision involves an
exercise of discretion and we
are not satisfied that counsel
for the applicant, has in this
application, demonstrated that
the single justice exercised her
discretion wrongly. Indeed, this
matter involves the exercise of
discretion in four different
forums. The applicant seems to
be asking this court to
substitute its discretion for
the previously exercised
discretions, and he is doing so
without satisfactorily
demonstrating that in any of the
earlier forums, there was abuse
in the exercise of discretion.
We do not find any proper basis
for the grant of the application
and the same is accordingly
refused…”
The application before me
is a repeat application as per
rule 20(2) of C.I. 16, for the
suspension of enforcement of the
ruling of the Court of Appeal
dated 20th July 2016
pending the determination of the
appeal before this Court. The
rationale behind the filing of
this application was clearly
spelt out under paragraph 4 of
the affidavit in support filed
on 26th May 2017,
which I reproduce below:
“4. I have been advised that the
suspension of the ruling of the
Court of Appeal dated 20th
July 2016 and consequentially
the ruling dated ordering the
preservation of the machines,
equipment and vehicles would
ensure that the determination of
the appeal in favour of the
applicants would prevent it from
being rendered nugatory”
So in brief, the
contention of the applicants was
that if the ruling of the Court
of Appeal, which they themselves
agreed is not an executable one
and therefore not amenable to a
stay of execution, is not
suspended, they would be handed
a pyrrhic victory in the event
of their appeal succeeding.
Arguing in support of the
application, applicants said the
respondent would lose nothing in
case their appeal fails since
damages would be an adequate
remedy as the value of the
equipment, machinery and
vehicles could be assessed. They
contended further that there are
serious matters of law and fact
for the consideration of the
Supreme Court that was why the
three-member panel of the Court
granted them special leave to
appeal. Applicants cited the
decisions of this Court in
Standard Chartered Bank Ltd v
Western Hardwoods [2009] SCGLR
196 and Merchant Bank (Gh)
Ltd v Similar Ways Ltd [2012] 1
SCGLR 440 in support of
their prayer.
The respondent vehemently
opposed the application and
relied on his affidavit in
opposition filed on 22nd
June 2017. He submitted that
this Court has no jurisdiction
to grant the application as
laid. Arguing in support of this
submission, respondent contended
that the substantive appeal
pending before the Court of
Appeal was to set aside the
preservation order made by the
High court. However, instead of
concentrating on the prosecution
of that appeal, the applicants
have circumvented the procedure
and want this Court to determine
what the Court of Appeal is yet
to determine. The respondent
argued that the refusal of the
application would not, in any
way render nugatory any success
the applicants might chalk in
their appeal before this Court.
According to him, the appeal
before this Court is not against
the preservation order made in
the High Court but against the
ruling of the Court of Appeal
refusing to discharge or reverse
the ruling of its single
justice. The respondent recalled
this Court’s attention to its
previous decision in the case of
Merskworld Co. Ltd (No.2) v
Zoomlion (Gh) Ltd (No.2)
[2013-2014] 1 SCGLR 327. In
that case, a three-member panel
of this Court, per Anin-Yeboah,
JSC stated that in determining
applications of this nature,
“care must be taken not to
prejudice the substantive appeal
at the Court of Appeal by
embarking on any pronouncements
of the law that may pre-empt the
appeal before it is even heard”.
In the Merchant Bank v
Similar Ways and Standard
Chartered Bank v Western
Hardwood cases (cited supra)
this Court held that it could,
in appropriate cases, grant
applications for the suspension
of orders or decisions of lower
courts where the conventional
means of applying for stay of
execution is not possible.
However, in the case of
Golden Beach Hotels (Gh) Ltd v
Pack Plus International Ltd
[2012] 1 SCGLR 452, the
Court gave a caution as to how
this power must be exercised.
The Court held that this
power of suspending orders must
be exercised sparingly in order
not to vary or render irrelevant
the otherwise settled rule of
practice on executable and
non-executable orders or
decisions. The Court, per
Date-Bah JSC, stated that the
preconditions for triggering
suspension orders must be
stricter and narrower than that
of ordinary applications for
stay of execution. This,
according to the Court, was to
prevent the Court from
descending into a ‘morass of
sophistry’.
The Court held: - “The
criterion for suspending an
order of a lower court should
not be identical with the
criterion summarized by
Akufo-Addo JSC in the Jebeile
case in relation to applications
for stay of execution, but
should embody an additional
element or requirement…we would
propose that a possible test
could be the nugatory effect
referred to in the Jebeile
case…, combined with the need
for exceptional circumstances.
If this test of a ‘nugatory
effect plus more’ is not
insisted upon, there would be no
point in maintaining the
distinction between the two
kinds of orders, namely; stay of
execution and suspension of
orders of lower courts”.
In the present application
before me, the only point raised
by the applicants is that, if
their application for suspension
of the order of the Court of
Appeal dated 20th
July 2016 is not granted, any
success they would chalk in
their appeal before this Court
would be rendered nugatory.
Aside of that, they did not
demonstrate any exceptional
circumstance to warrant the
grant of the application. I must
say that as the respondent
rightly contended, the appeal
before this Court is not in
respect of the preservation
order. The appeal before this
Court is against the refusal of
the Court of Appeal to discharge
the order of the single justice
of the Court of Appeal refusing
to stay the execution of the
preservation order made by the
trial High Court. The appeal
against the preservation order
itself is still pending before
the Court of Appeal. As this
Court held in the Merskworld v
Zoomlion case supra, it is not
appropriate for me to take any
step that would pre-empt the
determination of that subject
matter pending before the Court
of Appeal. Quite apart from
that, I do not see how the
refusal of this Court to suspend
the decision of the Court of
Appeal dated 20th
July 2017 could render nugatory
any judgment that the applicants
must obtain in their appeal
against it.
In my view, to stay
execution of a judgment is
tantamount to suspending its
enforcement within the period of
the stay. The two have something
in common. In some sense, they
may have the same result. This
Court has settled on the
principles governing the grant
of stay of execution and this
has crystallized in the
oft-quoted maxim that;
‘non-executable orders cannot be
stayed’. The fact alone that
this Court granted leave to the
applicants to appeal against the
ruling of the Court of Appeal is
not a sine qua non for the
suspension of the ruling sought
to be impeached. The applicant
must go further to demonstrate
exceptional circumstances to
merit the suspension of the
order or ruling in question.
The increase in the number
of such applications before this
Court of late seeks to suggest
that where one fails to succeed
in an application for stay of
execution of a decision, the
next step available to the
unsuccessful applicant is to
apply for suspension of
enforcement of that decision. I
wish to emphasize that an
application for suspension of
the decision or orders of a
lower court is not the
inevitable successor to an
unsuccessful application for
stay of execution. If that were
the case then the settled
practice that the courts cannot
stay non-executable orders would
be a mirage. The courts require
more than the nugatory effect
from a party who wants
non-executable orders to be
suspended pending appeal
otherwise we would be wading
into a semantic quagmire, which
Date-Bah, JSC in the Golden
Beaches Hotel case described as
a ‘morass of sophistry’.
The criterion for the
grant of applications of the
nature before me, as clearly
spelt out in the Golden Beach
Hotels case (supra) is; will
the appeal be rendered nugatory
upon succeeding and if yes, are
there any exceptional
circumstances to necessitate the
suspension of the decision
complained of? The nugatory
effect alone is not enough to
ground an application for
suspension of enforcement where
an application for stay of
execution is not the appropriate
remedy. In the instant
application before me, the
applicants have not demonstrated
in any way that their appeal
before this Court would be
rendered nugatory upon
succeeding. That apart, they did
not demonstrate any exceptional
circumstance to warrant the
grant of their prayer. Having
failed to satisfy the criterion
for the grant of such
applications, their application
must necessarily fail and I so
decree.
Y. APPAU
(JUSTICE OF THE SUPREME COURT)
COUNSEL
STANLEY ADJEI FOR THE
DEFENDANTS/APPELLANTS/APPLICANTS
DANIEL SEGU OSEI FOR THE
PLAINTIFF/RESPONDENT/REPONDENT |
