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Practice and Procedure – Civil
Procedure - Execution - Judgment
creditor - Loan facility -
Beneficiary of a judgment-
Attachment – contract of sale -
Interpleader - Section 13(1) -
Evidence Act, 1975, NRCD 323 -
Order 44 rules 12 ,13 of C. I.
47 Order 48 rule 4(1)(b) - High
Court Rules, 2004, C. I. 47 -
Burden of proof of Collusion -
Section 4 -
Lands Registry Act, 1962, (ACT
122) - Land Title
Registration Act, 1986, PNDCL
152 - of section 3(2) and (4) -
Mortgages Act, 1972, NRCD 72
HEADNOTES
The Attorney-General, the 1st
Defendant, described as the
judgment creditor, is the
beneficiary of a judgment
entered for the plaintiff in
this case, reported as Amidu
(No. 3) v. Attorney-General;
Waterville Holdings (BVI) Ltd. &
Woyome (No. 2) (2013-2014) 1
SCGLR 606. The judgment creditor
sought to go into execution
against Alfred Agbesi Woyome the
3rd Defendant, described as the
judgment debtor. In the process
of execution, the judgment
creditor attached two houses
numbered 260 and 267 situate at
Adjiraganor, Trassaco Valley,
Accra, among others, which are
said to be owned by the judgment
debtor. Also attached are the
plant and machinery of Anator
Holding Company Ltd and its
subsidiary Anator Quarry Company
Limited, called the Companies.
When the attachment got to the
attention of the UT Bank (In
Receivership) described as the
Claimant, they put in a claim of
interest, per the receivers in
the following properties
Claimant filed an affidavit of
interest wherein they said those
two houses situate at Trassaco
Valley were sold to the bank by
the judgment debtor; they also
claimed the Kpehe house and the
Companies’ assets were secured
with them for a loan facility by
the judgment debtor and the
Companies, The judgment creditor
disputed these claims, saying in
an affidavit that the Claimant
was in collusion with the
judgment debtor in that, having
regard to the facts on the
ground, the purported sale of
the two houses at Trassaco
Valley was a sham. The parties
also offered viva voce evidence.
HELD
The court is not the right place
for persons who violate the law
to seek comfort. For failing to
stamp the mortgage deeds which
create interest over land
situate in Ghana under section
32 of Act 689, I reject exhibits
5 and 5i in their entirety. In
effect I hold that any of the
properties listed in exhibits 5
and 5i that is found to be owned
by the judgment debtor is free
from any encumbrance or charge
and is liable in execution of
the judgment against him. I
hereby reject the Claimant's
application and dismiss same
accordingly.
STATUTES REFERRED TO IN JUDGMENT
Evidence Act, 1975, NRCD 323.
High Court Rules, 2004, C. I. 47
Mortgages Act, 1972, NRCD 96
Companies Act, 1963 (Act 179)
CASES REFERRED TO IN JUDGMENT
Amuzu v. Oklikah, (1998-99)
SCGLR 141.
Anthony Wiafe v. Dora Borkai
Bortey &. 1 or., CA. J4/43/2015,
dated 1st June 2016, unreported.
Borrowers and Lenders Act, 2008
(Act 773)
Republic v. Lands Commission; ex
parte Vanderpuye Orgle Estates
Ltd (1998-99) SCGLR 677
Nartey v. Attorney-General
(1996-97) SCGLR 63.
Lizori Ltd v. Mrs. Elizabeth
Boye and 1 or. (2013-2014) 2
SCGLR 889
BOOKS REFERRED TO IN JUDGMENT
DELIVERING THE LEADING JUDGMENT
BENIN, JSC:
COUNSEL
A.A. ACKUAKU JUNIOR FOR THE
CLAIMANT WITH HIM GODFRED ANIM
NYARKO
OSAFO BUABENG FOR 3RD
DEFENDANT/JUDGEMENT /DEBTOR WITH
HIM
BENEDICTA ANTWI.
GODFRED YEBOAH DAME, DEPUTY
ATTORNEY GENERAL, FOR 1ST
DEFENDANT/JUDGEMENT /CREDITOR
WITH HIM MRS HELEN ZIWU
(SOLICITOR GENERAL), MRS STELLA
BADU (C.S.A), MS YVONNE
BANNERMAN (S.S.A) AND
MRS AURIELLE ASARE BOATENG
(A.S.A).
RULING
BENIN, JSC: -
The Attorney-General, the 1st
Defendant, described as the
judgment creditor, is the
beneficiary of a judgment
entered for the plaintiff in
this case, reported as Amidu
(No. 3) v. Attorney-General;
Waterville Holdings (BVI) Ltd. &
Woyome (No. 2) (2013-2014) 1
SCGLR 606. The judgment creditor
sought to go into execution
against Alfred Agbesi Woyome the
3rd Defendant, described as the
judgment debtor. In the process
of execution, the judgment
creditor attached two houses
numbered 260 and 267 situate at
Adjiraganor, Trassaco Valley,
Accra, among others, which are
said to be owned by the judgment
debtor. Also attached are the
plant and machinery of Anator
Holding Company Ltd and its
subsidiary Anator Quarry Company
Limited, called the Companies.
When the attachment got to the
attention of the UT Bank (In
Receivership) described as the
Claimant, they put in a claim of
interest, per the receivers in
the following properties:
i. Residential property
located at Trassaco Valley
Estates, Accra described as plot
no. 260.
ii. Residential property
located at Trassaco Valley
Estates, Adjiriganor, Accra
described as plot no. 267.
iii. Residential property
at Kpehe, Accra New Town, Accra,
described as plot no 42, house
no. 327/7.
iv. Plant and Machinery
of Anator Quarry Ltd.
The judgment creditor filed a
notice of dispute. The Claimant
filed an affidavit of interest
wherein they said those two
houses situate at Trassaco
Valley were sold to the bank by
the judgment debtor; they also
claimed the Kpehe house and the
Companies’ assets were secured
with them for a loan facility by
the judgment debtor and the
Companies, for a consolidated
loan in favour of Anator Quarry
Ltd. The facility is still
outstanding. They claimed to
have purchased house number 267
situate at Trassaco Valley as
per the title deed, exhibit 2.
They also claimed to have
purchased house number 260 also
situated at Trassaco Valley as
per the sale contract, exhibit
3.
The judgment creditor disputed
these claims, saying in an
affidavit that the Claimant was
in collusion with the judgment
debtor in that, having regard to
the facts on the ground, the
purported sale of the two houses
at Trassaco Valley was a sham.
The parties also offered viva
voce evidence.
In this matter, the burden of
producing evidence is on the
Claimant, in the first instance.
They ought to lead evidence,
albeit prima facie, to satisfy
the court that they have a real
or proper claim over the
properties they have listed.
They do so on a balance of
probabilities. The burden then
shifts to the judgment creditor
to lead evidence on the acts of
collusion which go to establish
the sale of the Trassaco houses
to be a sham. The burden of
proof on the part of the
judgment creditor is much
higher, that of proof beyond
reasonable doubt, in line with
section 13(1) of the Evidence
Act, 1975, NRCD 323. This is so,
because collusion as raised in
these proceedings borders on
criminality thus requiring a
higher standard of proof. The
view of the law the court has
taken is contrary to the
judgment creditor's position as
stated in their statement of
case, that Order 48 rule 4(1)(b)
of the High Court Rules, 2004,
C. I. 47 places the burden of
proving collusion on the party
interpleading. The UT Bank is a
Claimant to the properties as of
legal right and does not purport
to be holding same on behalf of
another person. The provision
cited is therefore inapplicable.
These proceedings come under
Order 44, rules 12 and 13 of C.
I. 47.
Burden of proof of Collusion
Let me go into a little detail
in respect of the scope of Order
48 and Order 44 rule 12, which
often creates some amount of
confusion to the practitioners
and court officials as well.
Counsel for the judgment
creditor stated his view of
proof of collusion as follows:
“In our respectful view, the
fuss made by claimant about the
allegation of collusion between
claimant and judgment debtor is
pointless. Order 48 rule 4(1)b
of the High Court (Civil
Procedure) Rules, 2004, C. I. 47
clearly anticipates collusion
between a claimant and a
judgment debtor or other
parties, as a basis for the
commencement of interpleader
summons, and thus places the
burden of showing that there is
no such collusion, on the person
intervening or the applicant.
This is because the primary
essence of interpleader
proceedings is to show that the
intervenor is not motivated or
actuated by a desire to collude
with the judgment
debtor................That is
why Order 48 rule 4(1)b of C. I.
47 places the duty to show that
the intervenor or applicant is
not in collusion with the
applicant” He then cited what he
said was the provision contained
in Order 48(4)(1)(b).
In the first place, Order 48
rule 4 has no sub-rule 1, it
only has sub-rules numbered a, b
and c. What counsel cited is
Order 48, rule 4(b). I think the
wording of this particular rule
cited by counsel ought to have
put him on inquiry that it is
not the applicable provision in
the instant matter. The rule
talks about an applicant being
in collusion with a claimant.
Who is the applicant in the
instance? And who is the
claimant? The judgment debtor is
neither an applicant nor a
claimant in this matter, so
obviously this is not the
applicable provision.
Rule 4 derives its source from,
and its relevance depends on,
the preceding rules of Order 48.
I therefore quote rules 1, 2 and
3 of Order 48 here:
1. A person may apply to the
Court for relief by way of
interpleader where
(a) the person seeking relief,
in this Order referred to as
‘the applicant’ is under
liability for any debt, money or
goods for or in respect of which
the person is or expects to be
sued by two or more parties in
this Order referred to as ‘the
Claimants’ making adverse titles
thereto; or
(b) the person seeking relief is
a Registrar or other officer of
the Court charged with the
execution of process by or under
the authority of the Court, and
a claim is made to any property,
movable or immovable taken or
intended to be taken in
execution under any process or
to the proceeds or value of any
of the property by any claimant
other than the person against
whom the process is issued.
2. (1) An application for relief
under this Order shall be made
by motion with notice to the
Claimants.
(2) On the hearing of the
application, the Court may order
the Claimants to appear and
state the nature and particulars
of their claims and either
maintain or relinquish them.
3. Where the applicant is a
defendant, application for
relief may be made at any time
after the service of the writ of
summons and the Court shall stay
further proceedings until the
application has been dealt with.
Rule 1 envisages two scenarios
whereby interpleader summons may
be issued. The first falls under
rule 1(a) and it enables a
person to apply to Court when
there is claim for some property
and the matter is still before
the Court or in respect of an
action contemplated by rival
Claimants in respect of property
that is in his hands. In either
case, judgment has not been
delivered. In that situation,
any person who holds some asset
belonging to any of the parties
to the dispute and who himself
has no interest in the asset,
may go to court to protect
himself from the rival
Claimants, who are called upon
to interplead, that is to claim
against each other. This is
often described as stakeholders'
interpleader. In the case of
anticipated litigation, he may
apply by way of originating
summons, and in respect of
pending action, he goes to court
by summons in the action. This
provision clearly does not apply
here.
The other scenario, as captured
in rule 1(b) avails only the
Court Registrar or other Officer
of the Court, often called the
Registrar’s interpleader, or in
other places, the Sheriff's
interpleader. In such proceeding
it is the Registrar who takes
the initiative and brings an
application before the court to
determine whether the property
belongs to the judgment debtor
and can therefore be seized or
attached in execution or it
belongs to the claimant. Here
too, these present provisions do
not apply, as the Registrar did
not initiate any interpleader
summons.
This is a matter which falls
squarely under the provisions of
Order 44 rules 12 and 13 of C.
I. 47. The material provisions
are:
12(1) A person who makes a claim
to or in respect of a property
taken or intended to be taken in
execution under process of the
Court, or to the proceeds or
value of any such property,
shall give notice of the claim
to the Registrar and shall
include in the notice a
statement of the person's
address for service.
12(2) On receipt of claim made
under subrule (1), the Registrar
shall forthwith give notice of
it to the execution creditor who
shall within four days after
receiving the notice, give
notice to the Registrar
informing the Registrar whether
the execution creditor admits or
disputes the claim.
12(3) Where
(a) the Registrar receives a
notice from an execution
creditor under subrule (2)
disputing a claim, or the
execution creditor fails to give
the required notice within the
period mentioned in that
subrule, and
(b) the claim made under subrule
(1) is not withdrawn, the
Registrar may apply to the Court
for relief.
12(4) An application for relief
by the Registrar under this rule
shall be made ex parte to the
Court seeking an order that the
claimant and the execution
creditor shall appear before the
Court on a date specified in the
order for the issue between them
to be determined.
(5) Where the Registrar receives
a notice from an execution
creditor under sub-rule (2)
admitting a claim, the Registrar
shall forthwith withdraw from
possession of the property
claimed and having withdrawn the
Registrar may apply to the Court
for an order restraining the
bringing of an action against
the Registrar in respect of the
Registrar having taken
possession of that property.
13(1) Where the hearing of
proceedings pursuant to an order
made under rule 12(4) all the
persons by whom adverse claims
to the property in dispute, in
this rule referred to as “the
Claimants” appear, the Court may
(a) summarily determine the
question in issue between the
Claimants and execution creditor
and make an order accordingly on
such terms as may be just.
It is observed that these
provisions apply only after
judgment and during the course
of executing the judgment, often
described as third-party claims.
They avail every person who
claims interest in the property
attached in execution, unlike
rule 1(b) of Order 48 which
avails only the Registrar or
other Officer of Court in
execution of court judgment.
Suffice it to say that a claim
of collusion or fraud may also
be raised under Order 44 rule 12
if the judgment creditor has
cause to believe the claimant
and the judgment debtor are in
collusion to deprive him of the
fruits of his victory or to deny
other persons who may have a
claim against the judgment
debtor. The rule of evidence
that applies here is that the
person who asserts the
affirmative of the issue assumes
the triple burden of producing
evidence, of persuasion and of
proof. In this case the burden
of proving collusion lies
squarely on the judgment
creditor.
Claimant’s case
According to the Claimant, title
to house no. 267 was established
by the production of title
deed-exhibit 2-registered with
the Land Title Registry. In
respect of house no 260, they
sought to establish title by way
of a sale agreement between them
and the judgment debtor herein,
tendered as exhibit 3. In
respect of the Kpehe Accra New
Town house and the Companies’
movable assets, they claimed
interest therein through a
mortgage transaction between
them and the Companies
represented by the Executive
Chairman, who is the judgment
debtor herein. The authenticity
of each one of these documents
was not in issue, so prima facie
they support the Claimant's
position. Thus, in the absence
of rebuttal evidence, the
documents must speak for
themselves to establish the
claim of interest put forward by
the Claimant.
The reasons are not far to seek.
Registration of exhibit 2 under
the Land Title Registration Law,
1986, PNDCL 152 is evidence of
title, subject to the equitable
doctrines of fraud and mistake
which have been given statutory
backing in section 122(1) of
this statute, and as decided in
several cases including Amuzu
v. Oklikah, (1998-99) SCGLR 141.
In respect of house number 260,
the agreement is acceptable
prima facie evidence of the
transfer of interest in land.
Registration is not the act that
gives validity to the transfer
as between parties to the sale
contract; see this court's
decision in the case of
Anthony Wiafe v. Dora Borkai
Bortey &. 1 or., CA. J4/43/2015,
dated 1st June 2016, unreported.
The exhibits 5 and 5i provide
prima facie evidence of
Claimant's interest in those
properties, being the
subject-matter of the mortgage
transaction.
The burden thus shifts to the
judgment creditor to show that
notwithstanding what these
documents portray, the court
should discountenance them and
decide that they do not convey
interest in the subject-matter
properties in the Claimant.
Case for judgment creditor
The facts recited by the
judgment creditor will be
considered seriatim.
In respect of House Number 267,
the judgment creditor relied on
these facts:
(1) That there is no contract of
sale between the Claimant and
judgment debtor.
(2) That the property which is
the subject-matter of exhibit 2
is not the same as number 267,
which was transferred from
Empire State Builders (original
owners) to the judgment debtor.
This is based on two factors
namely, (a) the plot number
itself, and (b) the dimensions.
(3) The same property was
subsequently used by the
judgment debtor to guarantee a
loan facility for his companies
with the same bank, Claimant
herein.
(4) The Claimant has never been
in possession of this property
since the purchase, its rather
the judgment debtor and/or his
agents who have occupied same.
(5) The fact that the sale
transaction is fake is further
buttressed by the fact that the
judgment debtor still holds on
to these properties as owner and
the Claimant does not debunk the
claim.
The grounds (3) (4) and (5)
stated above equally apply to
property numbered 260. Besides,
consideration paid in respect of
no. 260 will also be taken into
account, as well as lack of a
site plan.
It is necessary at this stage to
mention the properties used as
collateral by the judgment
debtor and recited in the
mortgage deed, exhibit 5. It
reads:
“The facility shall be secured
with
1. Legal Mortgage over property
number 372/7, off CONCAM
Crescent Residential Area, Accra
Newtown, Accra with a forced
sale value of USD1,080,000.00
(already held).
2. Legal Mortgage over two
residential properties at
Adjiriganor Trassaco Valley
Residential area estimated at
USD1,296,000.00 and
USD1,512,000 (already held).
3. Legal Mortgage over a quarry
land and other quarry asset
estimated at GHs5,456,187,
subject to it being regularized.
4. Legal Mortgage over the head
office building of Anator
Holding Company Ltd situate at
East Legon extension valued at
USD1,687,500.00”
From even a cursory reading of
this deed, it cannot escape
attention that of the three
houses used as collateral, it is
only the two houses situate at
the Trassaco Valley whose
identity is not disclosed. The
identity of the two houses at
Trassaco Valley mentioned in
exhibits 5 and 5i is within the
peculiar knowledge of the
Claimant and the judgment debtor
only. That being so, the
Claimant was under a duty to
make an honest disclosure to the
court, especially so as he has
approached the court to seek an
equitable and legal remedy. He
who comes to equity must do
equity; he who comes to equity
must come with clean hands.
Section 17(1) of the Evidence
Act, 1975 (N.R.C.D 323) is
applicable here. It provides:
“Except as otherwise provided by
law, the burden of producing
evidence of a particular fact is
on the party against whom a
finding on that fact would be
required in the absence of
further proof.”
When material facts are within
the peculiar knowledge of a
party, he assumes the burden of
producing such evidence or
suffer a decision against him on
the issue.
The fact that the location of
the properties and their value
were disclosed in the mortgage
deed affirms to me that the
Claimant positively knew what
these properties were. From the
evidence before the court, apart
from 260 and 267
the judgment debtor is not known
to own any other properties
within the Trassaco Valley
enclave. It is thus reasonable
for any objective third party to
conclude that the two properties
mentioned in exhibits 5
and 5i are 260 and
267. And if indeed the
claimant had purchased these
assets, they could not have
allowed the judgment debtor to
use them as collateral for a
loan. They allowed it because in
truth there was no sale of those
properties to them. I have no
doubt in my mind that the
Claimant was assisting its
customer, the judgment debtor
herein, to hide the identity of
his Trassaco Valley properties
under the cloak or veneer of
legality by claiming it had
purchased them. It is
significant to note that the
then CEO of Claimant bank
signed all material exhibits
including 5 and 5i
on behalf of the Bank. There is
no way the then CEO of
Claimant bank could tell us he
would accept unidentified and
unknown properties as collateral
for a loan of over nine million
Ghana cedis. The CEO knew
what properties the judgment
debtor owned at the Trassaco
Valley at the time they advanced
the loan to his companies.
I just have to state here that
the Claimant appeared to have
accepted that the document
exhibit 2 does not
conclusively resolve title in
their favour. Under
cross-examination, the
Claimant’s representative made
two critical admissions, namely:
(i) that exhibit 2 does
not show transfer from the
judgment debtor to the Bank and
(ii) that exhibit 2 does
not even show that it is the
same plot no. 267 owned
by the judgment debtor. These
pieces of evidence add weight to
the position taken by the
judgment creditor.
I will proceed to consider other
facts relied upon by the
judgment creditor in proof of
the allegation of collusion.
Possession of the Properties
Under normal circumstances, the
fact that the Claimant did not
take over possession of the
properties it claimed to have
purchased some five years after
the purchase would have passed
unnoticed, but not in a case
where collusion is an issue. It
is clear from the proceedings
that apart from documentation,
there was nothing else to show
that the Claimant had anything
to do with the properties. They
did not even know that they were
being occupied by the judgment
debtor and/or his agents, or by
some other person. The Bank’s
representative admitted under
cross-examination that the Bank
had never used the two houses
for their business or residence.
Their claim that they have the
keys is false in view of the
judgment creditor’s credible
assertion that people were
occupying them. Since the
properties were in the hands of
the judgment debtor prior to the
purported sale, it is safe to
accept the evidence that he
would continue to be in
possession either by himself or
his assigns and agents as the
Bank had never occupied them.
And as will shortly unfold, the
judgment debtor has never
relinquished his interest in
these properties, so a claim
that they are being occupied by
him and/or his agents cannot be
disbelieved. I am satisfied that
the continued possession by the
judgment debtor and/or his
agents in these properties long
after the purported sale was not
an isolated act, but was part of
a scheme carefully crafted
between the Claimant and the
judgment debtor to use the
purported sale documents to
shield the assets of the
judgment debtor.
Size of number 267
Next, the size of property
267 sold to the judgment
debtor by the Empire State
Builders differs from that
purported to have been
registered in exhibit 2.
The land sold to the judgment
debtor measures 0.408 of
an acre, whereas that
purportedly sold by the judgment
debtor to the Claimant measures
0.37 of an acre. None of
the bearings of the plot as
indicated in the Schedule to the
deed executed between the
judgment debtor and Empire State
Builders tallies with the
bearings of the property sold to
the Claimant and described in
the site plan attached to
Exhibit 2. No
explanation was offered for
these discrepancies. Standing
alone, the court could have
glossed over them and give the
Claimant and judgment debtor the
benefit of the doubt. But in the
context and circumstances of
this case, wherein collusion is
alleged, parties to the deed
must explain every discrepancy
to the satisfaction of the
court. Unless the Court is
taking judicial notice of
notorious facts, it is not
permitted to conjecture as to
what brought about these
discrepancies. I am satisfied
that no. 267 is not the
subject-matter of exhibit 2;
they are different properties.
Consideration paid for number
260
Besides the foregoing, in
respect of 260, there is
the question of what
consideration was paid. This
issue will be better addressed
against the backdrop of what the
Claimant said in respect of the
other property number 267.
When the issue of lack of a sale
contract for number 267
was raised by the judgment
creditor, the Claimant was quick
to point to the registration
document annexed to the Land
Title Certificate, exhibit 2
as disclosing the
consideration paid for the
property. This document, headed
TRANSFER OF LEASEHOLD
bearing number 0058873
and dated 5th April 2013, states
the consideration for this
property as GHc400,000.00,
receipt whereof the judgment
debtor duly acknowledged. This
is what counsel for the claimant
said in his written statement of
case:
“Pages 25 and 26
of the land certificate clearly
show that the said property was
duly transferred to the Claimant
by the 3rd Defendant. Page 26....contains
the following: IN
CONSIDERATION OF FOUR HUNDRED
THOUSAND GHANA CEDIS ONLY,
I........ALFRED AGBESI WOYOME OF
PMB 100, GPO,
ACCRA............hereby transfer
to....UT BANK LTD.......ALL THAT
PIECE OR PARCEL OF LAND NUMBER
267 SITUATE AT TRASSACO
VALLEY....”
The probative value of this
piece of evidence, according to
counsel, is that the
registration document should be
accepted by the court as
authentically disclosing the
consideration paid for number
267. It is accepted on its face
value since it is coming from
both parties to the sale
contract and addressed to a
State institution, which also
acted on it.
In exhibit 3, the
consideration for Number 260
was stated to be GHc1.2
million, but in the
registration document, bearing
number 0058870, dated 6th May
2013, exhibit 4, the
consideration for the property
was stated to be
GHc100,000.00, receipt
whereof the judgment debtor once
again duly acknowledged. The
Claimant was fully aware of
this, since the bank itself put
in these particular exhibits. Of
much more significance is the
fact that exhibit 4 was
executed on behalf of the
Claimant bank by no less a
person than its CEO,
called Prince Kofi Amoabeng. The
court is not entitled to
conjecture as to the clear
inconsistency in the sale price
quoted on the two exhibits. I
find as a fact that no agreement
as to consideration for this
property was reached between the
parties. I am of the firm
conviction that the
inconsistency exists because in
fact and in truth there was no
sale between the parties. This
further exposes the transaction
as a sham.
No site plan
It is undisputed that no site
plan of no. 260
was issued in the name of the
Claimant. Even exhibit 4
which is the registration
document still bears the name of
the judgment debtor on the site
plan. Section 4 of Act 122
requires the name of the
person to be registered as owner
to be on the site plan. Section
15 of the Land Title
Registration Act, 1986, PNDCL
152, takes it further to require
not a mere site plan, but one
that has been approved by the
Director of Surveys or an
officer authorized by him. It is
common knowledge in this country
that any person who acquires
land is issued a site plan with
his name on it and indicating
the dimensions of the land he
has acquired. After the land has
been sold, it is unreasonable to
expect the vendor’s name to be
on the document that is prepared
for registration. To me, this
was not a mere omission or
mistake, but there was no plan
in the Claimant’s name because
there was no sale to them. I do
not think if there was a sale,
the Claimant would take steps to
register the title and even sign
the registration document
knowing full well that the site
plan bears the name of the
judgment debtor. It exposes the
transaction as a sham.
When all these pieces of
evidence are put together, I am
satisfied that the judgment
debtor never relinquished his
title to, and never sold
properties numbered 260 and 267,
notwithstanding the documents
tendered as evidence of the
sale. The Claimant was aware of
this and directly and willingly
aided the judgment debtor in
this enterprise.
I take note of the fact that at
all material times, there were
legal moves and public
agitations that the judgment
debtor should refund the 51
million cedis to the State. Any
clever person could take steps
to place his assets beyond reach
in the event of losing a claim
in court. At the time these
transactions, namely the sale
and mortgage, were taking place,
there was pending before this
court proceedings commenced in
2012 that eventually culminated
in the order made for the
judgment debtor to refund the
money illegally obtained from
the State.
It is my view that even if the
evidence had established a sale,
it would be clearly
unconscionable for a court of
equity to lend its aid to the
Claimant by releasing property
numbers 260 and 267 to it,
whilst allowing it to hide the
identity of the two properties
in exhibits 5 and 5i, from the
Court, something which is within
its peculiar knowledge. Be that
as it may, the evidence has
established that it did not in
fact and in truth purchase those
properties. I find as a fact
that there was no sale of these
properties. By exhibit 5 and 5i
the Court can reasonably exclude
these two properties 260 and 267
from the mortgage, as the court
cannot re-write the mortgage
deed, since the parties failed
to disclose their identity in
their agreement, contrary to
law. They cannot legally form
part of the mortgage.
Consequently, these properties
are not encumbered in any way, I
so find as a fact and are
therefore available for
execution to be levied on them.
I order the execution on these
properties numbered 260 and 267,
Trassaco Valley, Adjiriganor,
Accra, to proceed accordingly.
Other evidence
The foregoing is sufficient to
end this claim. But I decided to
have regard to a supplementary
statement of case filed by the
judgment creditor drawing
attention to some affidavit
depositions made by the Anator
companies which has a direct
bearing on the mortgage deed
under consideration, and their
intention to rely on it. After
examining the said affidavit, I
decided to have regard to it,
lest the court should give
contradictory decisions in
respect of the same
subject-matter for two different
persons. The result will be
messy and absurd. I also decided
to have a look at it as both
processes are in the same action
and the proceedings are
continuing until execution is
complete. Most importantly, the
Claimant Bank is a party to
those processes. I will explain
this a little further later in
this decision.
A mortgage deed is by law a
registrable instrument, by
virtue of section 3(2) and (4)
of the Mortgages Act, 1972, NRCD
72. Section 3 of this Act sets
out what the requirements should
be for the mortgage instrument
to be registrable under the
Lands Registry Act, 1962, (Act
122). Among others, the
requirements are:
(a) the name and address of each
mortgagor and of each mortgagee;
(b) the nature of the
mortgagor's interest in the
property which is mortgaged and
the extent to which that
interest is subject to the
mortgage;
(c) identity of the mortgaged
property by reference to its
location and boundaries .....
As a condition for the release
of the loan, the mortgage deed
required the borrower to produce
to the lender a copy of the
company resolution authorizing
the borrowing, among other
documents. The parties agreed in
the mortgage deed, exhibit 5 and
5i as follows: “The facility
shall become available for draw
down upon receipt of the
following documents in all
respects satisfactory to UT
Bank:
1. Receipt of formal letter of
request for the consolidation of
all the facilities......
3. Execution of legal Mortgage
over two residential properties
at Adjiriganor Trassaco Valley
Residential area...........
7. Receipt of board resolution
authorizing the
consolidation......”
I must mention at this stage
that, relying on this same
mortgage deed, Anator Holding
Company Ltd. and its subsidiary
Anator Quarry Ltd., also put in
a claim of interest in these
same proceedings claiming that
all the properties listed on the
mortgage deed were used as
collateral to secure the loan
facility provided by the
Claimant bank, so they could not
be sold by the judgment
creditor. They filed an
affidavit of interest, per one
Siade Puplampu, Administrative
Officer, copied to the Claimant
bank and they were served on 23
November 2018, according to
court Registry records. To my
mind it constituted notice to be
heard on this matter, which was
in their own interest to react
to it, as they are the other
contracting party to the
mortgage. The mortgage deed is
at the center of these two
processes wherein the Claimant
bank is the lever on which they
hinge. Consequently, it behoved
the Claimant bank to tell the
court their position in respect
of the affidavit depositions by
Anator companies. The judgment
creditor urged the court to
conclude that their silence is
an admission of the truth of the
affidavit depositions made by
Siade Puplampu in these same
proceedings. As the apex court
wherein ultimate justice is
required to be done, the court
cannot shun the invitation to
consider such important piece of
evidence which has a direct
bearing on the case on hand.
Parties have a duty to assist
the court to bring finality to
the matter.
The Bank was joined as the 1st
Claimant whilst the Anator
companies were the second
claimants. And they were a
necessary party since they and
the Anator companies were the
contracting parties to the
mortgage deed. I think they
ought to have been joined as an
interested party and not as
claimant, since a person cannot
be compelled to commence an
action. But this does not amount
to a miscarriage of justice, as
the title could be amended to
reflect their correct position
in the process. What is
important is that they were
served to appear which
invitation they spurned. I fail
to appreciate why they did not
contest the adverse claim by the
judgment debtor.
The law is quite settled that
proceedings include all
post-judgment steps taken in the
action, so every person who is
notified must appear to answer
unless he has nothing to tell
the court. Black’s Law
Dictionary, 9th edition, at page
1324, quoting from the author
Edwin E. Bryant’s ‘The Law of
Pleading under the Codes of
Civil Procedure’, states the law
as follows: “Proceeding is a
word much used to express the
business done in courts. A
proceeding in court is an act
done by the authority or
direction of the court, express
or implied. It is more
comprehensive than the word
‘action’, but it may include in
its general sense all the steps
taken or measures adopted in the
prosecution or defense of the
action, including the pleadings
and judgment. As applied to
actions the term ‘proceeding’
may include: 1. the institution
of the action;…………. 8. the
judgment; 9. the execution; 10.
proceedings supplementary to
execution, in code practice.”
The code practice is the
equivalent of our rules of
court.
It is stated for emphasis that
even during execution
proceedings, every person,
whether a party in the original
action or not, who stands to be
adversely affected by the
execution, must be heard by the
court if he so wishes. That
justifies the Anator Companies’
joinder of the UT Bank as a
party to their notice of claim
since they had mortgaged their
property with the Bank, and the
latter is relying on the same
mortgage deed in its claim
against the judgment creditor.
The court is also able to come
to this conclusion because the
mortgage deed required the
Anator companies, as the
borrower, to present a board
resolution authorizing the
consolidation of the loans.
Besides, it is a legal
requirement under the Mortgages
Act that the deed must state the
mortgagor's interest in the
property as well as its clear
identity and precise location.
Further, since the landed
properties did not belong to
Anator companies as the
borrowers, the consent of the
real owner was required to
support the application. All
these relevant pieces of
information which would
facilitate the bank’s approval
of the loan facility are
contained in the affidavit which
the judgment creditor sought to
rely on. The fact that the
approval was given by the Bank
is indicative of the fact that
all the prerequisites were met
by the companies. Hence the
evidence is material and
relevant.
The material depositions made in
the affidavit of Siade Puplampu
on behalf of the Anator
companies are these:
“15. That on 29th October, 2013,
UT Bank granted yet another
facility to Anator Holding
Company Limited as additional
working capital to purchase
equipment for Quarry
operation..........
16. That as security for the
payment of the facilities
granted to Anator Holding
Company Limited, 3rd Defendant
Judgment/Debtor in a Statutory
Declaration agreed and released
the property known as 372/17 off
Comcam Crescent........Accra to
Anator Holding Company Limited
to be used as collateral
security for the loan facility
from UT Bank ...........A copy
of the Statutory Declaration
dated 30th day of October 2013
is annexed as exhibit AHCL 11.
17. That Claimant, UT Bank
Limited (in
receivership).........filed a
witness statement through one
Eric Nana Nipa..............that
the properties belonging to
the.........judgment debtor
attached in execution of the
judgment of this Honourable
Court, to wit: (a) two
residential properties at
Trassaco Valley Phase 2, plots
numbered 260 and 267; (b) Hse
no. 327/7;Kpehe, Accra Newtown,
Accra; (c) moveable assets of
Anator Quarry Company Limited.
18. That on 15th January, 2014,
Anator Holding Company Limited
in a letter captioned
consolation (sic) of loan
facilities for Anator Quarry
Company Limited addressed to the
Managing Director of UT Bank
Ltd., Anator Holding Company
resolved to deal with the loan
facility granted to it and 3rd
Defendant by consolidating all
the loan facilities and transfer
to Anator Quarry Company
Limited. A copy of the letter
together with extract from the
minutes of meetings of the Board
of Directors of Anator Holding
Company held on 3rd January 2014
held at its head office in East
Legon, Accra is hereby attached
as exhibit AHCL 12.
19. That thereafter
the...........judgment debtor in
a Statutory Declaration dated
16th day of January, 2014 agreed
to release and released
properties known as No. 260 and
267 at Trassaco Valley,
Adjiriganor to Anator Quarry
Company to be used as security
for the consolidated loan
facility from Ut Bank Ltd.
20. That for all intents and
purposes the 3rd Defendant
ceased to hold any interest in
the above-mentioned properties
so long as the properties remain
in the hands of Anator Quarry
Company Limited. A copy of the
Statutory Declaration dated 16th
January 2014 is herby attached
and marked as exhibit AHCL 13.”
This affidavit is very revealing
in terms of the dealings between
the Claimant bank and the Anator
companies. It states very
succinctly that the judgment
debtor owns properties numbered
260 and 267 situate at the
Trassaco Valley, inter alia. It
disclosed the course of doing
business between the parties
notably that the borrower
provides a statutory declaration
confirming ownership of the
properties to be secured for the
loan, before the Claimant
releases the facility. Thus, the
Claimant had possession of the
Statutory Declaration, exhibit
ACHL 13 before agreeing to
consolidate the loans.
For its full force and effect, I
will reproduce the judgment
debtor's statutory declaration
dated 16th January 2014. It
reads:
“IN THE SUPERIOR COURT OF
JUDICATURE
HIGH COURT OF JUSTICE, ACCRA.
GHANA. A.D. 2014
STATUTORY DECLARATIONS ACT 389
OF 1971
IN THE MATTER OF STATUTORY
DECLARATION BY ALFRED AGBESI
WOYOME GIVING HIS CONSENT FOR
THE USE OF HIS PROPERTIES, NO.
260 AND 267 AT TRASSACO VALLEY
ADJIRIGANO ACCRA, AS COLLATERAL
SECURITY FOR A CONSOLIDATED LOAN
FACILITY FROM UT BANK.
I, ALFRED AGBESI WOYOME of PMB
100 GPO ACCRA
in the Greater Accra Region of
the Republic of Ghana, do hereby
solemnly and sincerely declare
as follows:-
1. That I am the declarant
herein and a Ghanaian by birth
and Nationality.
2. That I am the owner of
properties known as Plot no. 260
and 267 at Trassaco Valley
Estates Adjirigano, Accra.
3. That I have agreed and
released my said property to
Anator Quarry Company Limited to
be used as collateral security
for the consolidated loan
facility from UT Bank Limited,
Airport City Branch, Accra.
4. That the said property has
not been mortgaged or involved
in any financial transaction
whatsoever and can therefore be
used for its intended purpose.
5. That I shall hold trust for
my said property until such time
Anator Quarry Company Limited is
able to fully liquidate its
repayment obligation to UT Bank
Limited, Airport City Branch,
Accra.
6. That UT Bank Limited is at
liberty to confiscate my
property (ies) should Anator
Quarry Company Limited renege on
its repayment obligations.
7. Wherefore, I make this solemn
declaration conscientiously
believing same to be true and
correct in accordance with
Statutory Declaration Act 389 of
1971.
This statutory declaration which
was given to the Claimant as
collateral sounded the death
knell on the dealings between
the Claimant and the judgment
debtor in respect of properties
numbered 260 and 267. Even when
common sense is brought to bear
on these dealings, it will
dictate that the Claimant would
not accept their own properties
to be used as collateral by a
borrower to secure a loan from
them. The judgment debtor could
not overtly, confidently and
boldly have given this statutory
declaration to the Bank if
indeed he had sold these
properties to them. Why then did
the Bank not challenge these
affidavit depositions by the
companies? Their stoic silence,
in the face of all the
opportunities they had to react,
raises a very strong presumption
that they had no answer to
offer. The evidence supports the
judgment creditor’s position
that the two houses were not
sold.
The court cannot be used as an
instrument of fraud. In one
breath, the Bank says the
properties have been sold to
them by the judgment debtor. In
another breadth, the judgment
debtor says he has never
encumbered the two houses except
releasing them as collateral for
the loan. So the parties have
taken these contradictory
positions so that whichever
story the court chooses to
believe, the properties are
saved from execution. But what
the court believes and is
convinced about is that the
properties were neither sold nor
used as collateral for the loan.
The entire scheme is a sham
Properties covered by mortgage
deed
I turn next to the properties
identified in exhibits 5 and 5i.
The legal position as stated in
sections 1(2) and 4(1) of the
Mortgages Act is that a mortgage
creates an encumbrance and a
charge on the properties secured
under the mortgage. The law
therefore prohibits the
mortgagor from dealing with the
properties whilst the mortgage
lasts. The law grants the
mortgagee security and an
assurance that he will recover
his money from a sale of the
mortgaged property in the event
of a default by the mortgagor.
Consequently, property secured
under a mortgage deed cannot be
used to pay for another
obligation owed by the mortgagor
to a third party. These are the
prevailing general principles
stated in this statute.
However, the equitable doctrine
of fraud will be applicable in
an appropriate case for a court
to cancel a mortgage deed whose
aim and purpose was to defraud
creditors of the mortgagor. And
as submitted by the judgment
creditor, certain interest in
land will not take effect unless
registered under law. He cited
the Court of Appeal decision in
the case of First Atlantic
Merchant Bank Ltd v. Osei
(2013-2015) 2 GLR 457 as
well as certain statutes which I
will refer to shortly. The
decision of this court in the
Anthony Wiafe v. Dora Borkai
Bortey case cited above does
not do away with the requirement
for registration, it only stated
clearly that the contract gives
a right to the transferee,
lessee or purchaser, as the case
may be. The court went on to
decide that such a person may
lose title to a bonafide
purchaser who has gone ahead to
register his title even though
it was acquired later in time.
Therefore, lack of registration
may defeat a contract creating
an interest in immovable
property in appropriate
situation.
Registration of documents
Counsel for the judgment
creditor made reference to these
statutes: Borrowers and Lenders
Act, 2008 (Act 773), section 25
thereof; Land Registry Act,
1962, (Act 122), section 4
thereof; and section 72 of PNDCL
152. Counsel's argument, in a
nutshell, was that these
statutes made it obligatory for
the mortgage deed to be
registered in order to render
same effectual. Besides, I have
already stated herein that a
mortgage document is a
registrable instrument under the
Mortgages Act.
The relevant statutory
provisions cited by counsel for
the judgment creditor are these:
Section 25 of Act 773 provides:
Registration of charges
(1) A borrower or a person
interested in a charge shall
register a certified copy of a
charge or collateral created by
the borrower in favour of a
lender with the Collateral
Registry within twenty-eight
days after the date of the
creation of the collateral or
charge.
(2) Where a charge is created by
a company, the requirement to
register charges with the
Collateral Registry under this
section shall be in addition to
the requirement under section
107 of the Companies Act, 1963
(Act 179) to register charges
with the Registrar of Companies.
(3) A charge which is not
registered in accordance with
subsection (1) is of no effect
as security for a borrower's
obligations for repayment of the
money secured and the money
secured shall immediately become
payable despite any provision to
the contrary in any contract.
Section 72 of PNDCL 152
provides:
(1) A mortgage created after the
commencement of this Law shall
be in the prescribed form and
shall have no effect unless it
is registered in accordance with
this Law.
Counsel for the judgment
creditor was of the view that
since exhibits 5 and 5i, among
other documents, have not been
registered, the court should
give no effect to them.
On his part, counsel for the
Claimant sought to downplay the
effect of non-registration of
these documents. This is what he
said in his statement of case:
“.......exhibit 5i clearly
indicates that the property at
Accra New Town and the Plant and
Machinery of Anator Quarry
Limited are encumbered
properties and that fact was
acknowledged and admitted by the
1st defendant. The mere fact
that the mortgage deed in
respect of the said properties
had not been registered, as
provided for by statute, does
not take away the fact that they
are encumbered.” Counsel
proceeded to cite two decided
cases in support of his
submission, which he said are
very instructive. These are:
Republic v. Lands Commission; ex
parte Vanderpuye Orgle Estates
Ltd (1998-99) SCGLR 677 and
Nartey v. Attorney-General
(1996-97) SCGLR 63. He
concluded the submission on this
question by stating that “it
would be absurd that the
legislature would intend that,
in circumstances where it has
been established as a matter of
fact that a property has been
used as collateral, and this
fact has been admitted by both
contending parties, the
non-registration of a deed of
mortgage duly executed by the
parties......will invalidate the
interest of a lender, after the
lender had given out its
depositors funds as a loan to
the borrower.....”
The Nartey v.
Attorney-General, supra,
case which counsel cited is
completely inapplicable, in
terms of both fact and law. That
was a constitutional case and
the decisions rendered therein
cannot in any way be applied in
this case. Equally, there is
nothing in the other case
namely, ex parte Vanderpuye
Orgle Estates Ltd that is
relevant to the issue on hand.
It behoves Counsel in citing a
decided case to look for its
relevance and point out to the
court the ratio, usually found
in the principle of law espoused
in that decision, which can be
applied in the present case. I
spent precious time reading all
the five opinions delivered in
the Nartey case to see whether
anything useful and relevant to
the instant case would be found.
Not even an obiter dictum that
is worth the effort could be
found therein. Counsel should
endeavour to spare us such
ordeal. The simple truth is that
Counsel has no answer to the
arguments put forward by counsel
for the judgment creditor, which
are unassailable.
The statutes cited above are
very explicit in their terms and
admit of no ambiguity. A
mortgage deed whereby money has
been lent and borrowed imposes
an obligation on the parties to
register same under the law,
namely Act 773; and Mortgage
over land requires registration
under NRCD 96 and PNDCL 152, as
already explained. lest it
should be rendered ineffectual.
Counsel for the Claimant
admitted the existence of these
statutes. Why they failed to
comply with the requirement of
registration, albeit belatedly,
before coming to this court
beats my understanding. The
court cannot allow anybody to
circumvent the clear statutory
provisions, especially as
registration of such mortgage
documents attracts some revenue
to the State and more
importantly it serves as notice
to third parties that the
properties are encumbered. On
ground of public policy that the
law must be enforced, the court
will enforce the law regardless
of whether or not the Claimant
will suffer a loss of the loan
it granted to the Anator
companies. The Claimant bank
should bear the consequences, if
any, of their own default. I
hope this will be a lesson to
all lending institutions in the
country, to ensure strict
adherence to the law requiring
registration of mortgage deeds.
However, counsel’s fear is taken
care of by section 25(3) of Act
773, as failure of a mortgage
deed does not relieve the
borrower of his liability to pay
back the loan under contract.
In the result, I hold that
exhibit 5 and 5i, being a
mortgage deed which has not been
registered by virtue of section
3 of the NRCD 96 (which made it
registrable under Act 122),
section 25 of Act 773 and
section 72 of PNDCL 152, is
ineffectual as far as third
party claims or interests in
those properties are concerned.
It is even arguable whether the
court will discountenance lack
of registration when the issue
is raised ‘inter partes’ on
ground that it is
unconscionable. It is a point
that may arise in future.
Stamp duty
Counsel for the judgment
creditor argued further that the
mortgage deeds should be
rejected by the court for
failing to comply with the Stamp
Act, 2005 (Act 589). In the case
of Lizori Ltd v. Mrs.
Elizabeth Boye and 1 or.
(2013-2014) 2 SCGLR 889,
this court held that any
document executed in Ghana or
elsewhere that affects land
situate in Ghana cannot be
admitted in evidence if it has
not been duly stamped. There is
no dispute that exhibits 5 and
5i have not been stamped and for
that reason they were not
receivable in evidence in the
first place. The position of the
law is that where legally
inadmissible evidence has found
its way into the record, it is
the duty of the court to reject
it when pronouncing judgment. It
is not one of those situations
which can be saved under section
6 of the Evidence Act. This is
because the stamp duty is a
statutory imposition and a
source of revenue to the State
so parties cannot be allowed to
flout the law and deny the State
of its revenue. That was why in
the Lizori Ltd case,
supra, the court rejected the
unstamped documents. This point
is also unanswerable.
I find it surprising that a
banking institution will pay no
regard to the laws of the land
in its operations and yet will
appeal to the court to give it
solace in time of need. The
court is not the right place for
persons who violate the law to
seek comfort. For failing to
stamp the mortgage deeds which
create interest over land
situate in Ghana under section
32 of Act 689, I reject exhibits
5 and 5i in their entirety.
In effect I hold that any of the
properties listed in exhibits 5
and 5i that is found to be owned
by the judgment debtor is free
from any encumbrance or charge
and is liable in execution of
the judgment against him.
I hereby reject the Claimant's
application and dismiss same
accordingly.
(SGD) A.A. BENIN
(JUSTICE OF THE SUPREME COURT)
COUNSEL
A.A. ACKUAKU JUNIOR FOR THE
CLAIMANT WITH HIM GODFRED ANIM
NYARKO
OSAFO BUABENG FOR 3RD DEFENDANT/JUDGEMENT
/DEBTOR WITH HIM
BENEDICTA ANTWI.
GODFRED YEBOAH DAME, DEPUTY
ATTORNEY GENERAL, FOR 1ST
DEFENDANT/JUDGEMENT /CREDITOR
WITH HIM MRS HELEN ZIWU
(SOLICITOR GENERAL), MRS STELLA
BADU (C.S.A), MS YVONNE
BANNERMAN (S.S.A) AND
MRS AURIELLE ASARE BOATENG
(A.S.A).
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