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MARGARET
INSAIDOO J (MS).
RULING ON DETENTION AND
PRESERVATION OF LOGS.
The Brief Facts
This is an application brought on
notice by the Plaintiff for the
detention and preservation of logs
packed in five (5) containers
location at the port of Tema
pursuant Order 25 Rule 2.
The brief facts are that 1st
Defendants have concession called
admitted farm NQ. 34 in the
Offinso Brohuma forest reserve in
the Offinso District and for the 2nd
admitted farm Nos. 22 and
36.
The Defendant were advanced moneys
by the plaintiff and in the sums
of ¢l,Oll,210,OOO.OO and
¢660,OOO,OOO.OO in order to pay
for the concession to the Forestry
Commission.
The fact is admitted by the 1st
and 2nd Defendant.
In consideration of this, the
defendant agreed as per clause 2
of the agreements captured in
Exhibit 'A' and 'C' which reads as
follows:
'The seller irrevocably agrees to
supply all the logs from the said
concession to the buyer
The 1st and 2nd
Defendant allegedly failed to
honour the said agreement
by selling the 5 containers in
issue to a 3rd party
namely the 3rd
Defendant Ashish Exim (Ghana)
Ltd., instead of selling the logs
to the applicant
The applicant obviously very
aggrieved, came by Ex-Parte
application to stop the
exportation of the logs and has
subsequently come on notice. What
are the points that the court
ought to consider before the grant
or otherwise of such an
application?
The following questions should
guide us:
1)
What are we seeking to preserve?
Will it be just and convenient if
the application is granted.
Is there a serious question to be
tried among the Plaintiff and the
Defendant?
Who will be relatively more
inconvenienced?
Can the party or Plaintiff be
compensated for in damages?
Arguments by counsel for applicant
The plaintiff/applicant is in
court with an application on
notice for the retention and
preservation of logs packed in
five containers at the port of
Tema.
The application is being brought
pursuant to order25 rule 2 or
CI47.
The plaintiffs case is that:
1)
The plaintiff entered into an
agreement with the 1st
and 2nd defendants of
for the supply of logs for which
the plaintiff paid to the 2nd
defendant over one billion and the
2nd defendant
¢660,OOO.OO.
The terms of the agreement were
couched in the sense that the
defendants were to supply all the
logs in the concession.
Counsel averred that the 1st
and 2nd defendants had
supplied the plaintiff wit~ less
than fifty percent of the quantity
of logs. To its utter dismay, the
defendants had entered into
another agreement with the 3rd
defendant. They had supplied five
containers to the 3rd
defendant that are currently the
subject matter of this
application. Thus it is the prayer
of the plaintiff/applicant that
the said logs be detained and
preserved till the final
determination of the suit.
Arguments by counsel for the 1st
and 2nd Defendant
Counsel for the 1st & 2nd
defendants opposed the application
of Plaintiff's counsel on the
following grounds:
The 1st & 2nd
Defendants admitted that they have
not supplied all the logs to the
plaintiff.
It is the case of the 1st
& 2nd Defendants that
they supplied 3rd
defendant because they needed
funds to buy diesel and a lot of
equipment as well as to mobilize
labour to get logs for the
plaintiff from the forest.
It is the case of the counsel for
the 1st and 2nd
defendants that money advanced to
them by the plaintiff was given to
the Forestry Commission for the
acquisition of the concession.
When that had been done, they
realized they needed more money to
organize labour to go into the
bush to get the logs, in the
circumstances they entered into
agreement with the 3rd
Defendant for that purpose. So
what they did was not done in bad
faith it was all in the interest
of the plaintiff.
Further, counsel said that the
clause that his clients had to
supply all the logs in the
concession to the plaintiff was
unconscionable but the logs would
be supplied to the tune of the
money given.
Counsel informed the court that
the 1st and 2nd
defendants were not well educated
and that thus their understanding
of the document was a problem. In
support he quoted the case of the
court of appeal decision in the
case of CFC Construction Co. v.
Attitsogbe reported in the May
Edition of the Monthly Law Reports
of Ghana
However, counsel submitted that
they will supply the logs to the
plaintiff as soon as possible.
Arguments by counsel for the 3rd
defendant
Counsel for the 3rd
Defendant also opposed the
application on grounds that:
1)
That they entered into the
agreement without any notice that
there was a prior existing
agreement between the 1st and 2nd
defendants on one side and the
plaintiff on the other. They only
got to know of that when they were
served with the present action.
Counsel for the 3rd
defendant contended that they had
been dealing with the defendants
out of good faith, and it is a
cardinal principle of law that the
bona fide purchaser for value
without notice of prior existing
agreement desire the benefits of
that agreement cited Basare vs.
Sakyi [1987] GLRD paragraph
31 holding 2.
It is the case of the 3rd
defendant that, as his five
containers sits at the port, he is
being charged with port fees of
$20 per container per day so any
delay will make him incur a lot of
expenses.
Again it is the case of the 3rd
Defendant that the Plaintiff has
the right to claim from the 1st
and 2nd defendants all
the remaining logs.
Therefore it is the prayer of the
3rd defendant that, the
court should give an order that
would enable him export his logs
from the port.
In coming to this conclusion, I
was guided by the cases cited by
learned counsels for the parties
and other authorities.
Seatec Ltd. vs. Penton Hook Farms
Ltd. & Anor. r1984-86U G LR 429
This was an interim injunction to
preserve the machines in dispute.
The Court of Appeal held that the
relief for the interim
preservation order was an
equitable one. If the equities
were equal the first in time
prevails it was just and
convenient that the res
litigosa be kept intact and
committed to the care of a neutral
third party. Justice Abban J. A
opined that it would be strange if
a court were to allow a party to
resist an equitable remedy sought
against it by the preferring party
and relying on his own criminal
conduct.
However, this instant case can be
distinguished from the above case
because the exporter of the logs
is the 3rd Defendant
bona fide purchaser and not the 1st
and 2nd defendants.
Odonkor vs. Amartey [1987-88] 1
GLR 579
It was held allowing the appeal;
the purpose of interim orders was
to hold the balance evenly between
the parties, pending the
resolution of matters in
difference between them and also
to ensure that at the
,
end of the day, the successful
party did not. find that his
victory was an empty one or one
that brought in more problems than
blessings. In that case both the
defendants and the plaintiffs were
restrained by the court from
dealing with the land in dispute
pending the resolution of the
suit.
Basare vs. Sakvi & Anor r1987-8811
GlR 313
In that case it was held that on
the evidence S. was the bona fide
purchaser without any notice of
any prior equitable interest. His
legal estates protected him
against all persons with equitable
interest except those who could
claim a prior superior legal
interest. Equity thus follows the
law and consequently S's legal
estate was protected.
The Sale of Goods Act,1961
Section 16(1) of the Sale of Goods
Act reads as follows: "If no time
is fixed for the delivery of the
goods, they must be delivered
within a reasonable time".
It is the 1st and 2nd
defendants' contention that the
agreement with the plaintiffs did
not stipulate the time. And that
they still had time to supply the
required number of logs.
It is however clear from the
averments of these defendants that
although they had not fulfilled
all their obligations to the
plaintiff, they nevertheless, went
ahead and supplied logs to the 3rd
defendants. If they the 1st
and 2nd defendants are seeking
equity, they must do equity or
come to equity with clean hands.
By Court
The 1st and 2nd
defendants in the main admit that
they are culpable. They concede
that the plaintiff assisted them
by advancing them monies to
activate the operational license
granted them by the Forestry
Commission. As such their
subsequent conduct was regrettably
reprehensible and smacked of the
"smart Aleck syndrome". The 1st
and 2nd defendants knew very well
that they ought to supply the
plaintiff to the tune of the
monies advanced, which were quite
substantial; yet they proceeded to
supply the logs to third parties.
On the balance of convenience, I
find that irreparable damage would
•
be caused in the grant of the
application and occasion a
miscarriage
of justice. The balance of
hardship therefore tilts in favour
of the third defendant. He was a
bona fide purchaser who had no
prior knowledge of an existing
arrangement between the plaintiff
and the 1st and 2nd
defendants.
I
would refuse the application but I
order that the defendants provide
an undertaking that they would
supply the requisite logs as per
their agreement to the
plaintiff/applicant on or before
the 7th day of
December 2006.
The 3rd defendant is
accordingly free to export the
logs, the subject matter of this
suit. The 1st and 2nd
defendants are to pay for all
costs incurred as a result of the
initial order made ex-parte that
lasted for ten days, and any
subsequent incidental expenses
incurred by the 3rd
defendant. The plaintiff is
discharged from its undertaking
accordingly.
Costs of ¢20 million cedis awarded
to the applicants to be paid by
the 1st and 2nd
Defendants.
(SGD) MARGARET INSAIDOO J (MS)
PARTIES:
PLAINTIFF
ABSENT
1
ST
AND 2ND DEFENDANTS
REPRESENTED BY NORMAN - PRESENT
3RD DEFENDANT PRESENT
COUNSEL:
MR. OSAFO BUABENG FOR THE
PLAINTIFF/APPLICANT - PRESENT
ANTHONY NAAMO FOR THE 1
ST
AND 2ND DEFENDANTS -
PRESENT
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