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Banking -
Non-bank financial institution –
Contract of guarantee -
Agreement – Failure to comply
with - Special and General
Damages - Breach of duty of care
– Cash Collateral - Defamation
– Whether or not the award of
general damages of five million
Ghana Cedis to the Plaintiff is
woefully inadequate - Whether or
not the award of general damages
of five million Ghana Cedis to
the Plaintiff is excessive and
harsh. - section 17 of the
Borrowers and Lenders Act, 2008
(Act 773) and section 146 of the
Deposit-taking Institution Act,
2016 (Act 930
HEADNOTES
Following discussions between
the Plaintiff a non-bank
financial institution which
provides financial and fund
management services represented
by its Managing Director, the 1st
Defendant bank in Ghana and 2nd
Defendant, a customer of 1st
Defendant, an Agreement was
reached between the parties for
the issuance of three Bank
Guarantees totaling US$550,000
to secure the delivery of Oil
Products from Nigeria to Ghana
at the instance of 2nd
Defendant. As a condition for
the issuance of the Bank
Guarantees, 1st
Defendant requested for Cash
Collateral in the sum of
US$550,000. The Plaintiff based
on the discussions between the
parties, issued written
instructions to 1st
Defendant on 7th
January, 2016, Exhibit “D” to
commence the transaction. The
Bank Guarantees were to last for
a period of 30 days. The Cash
Collateral deposited in 2nd
Defendant’s account by Plaintiff
was to be blocked in a pledged
account. It is the case of the
Plaintiff that, 1st
defendant failed to carry out
the instructions as contained in
Exhibit “D” and allowed 2nd
Defendant to withdraw the Cash
Collateral of US$550,000 in bits
over a period of six (6) months
hence the action in the High
Court against Defendants In its
Defence, the 1st
Defendant denied Plaintiff’s
claim and avers that, it
complied with the Written
instructions of the plaintiff.
Consequently, it is not liable
to any form of losses incurred
by the Plaintiff. At the end of
the trial, Plaintiff’s relief
(a), the claim for Special
Damages of Ten Million United
States Dollars or its cedis
equivalent for loss of income
was refused. Plaintiff’s relief
(b), the claim for general
damages was granted and it was
awarded five million Ghana cedis
(GH¢5,000,000). Its claim for
thirty million Ghana cedis (GH¢30,000,000)
for defamation was refused. The
Plaintiff’s relief (d), the
claim for the recovery of Five
Hundred and Fifty Thousand
United States Dollars
(US$550,000), the Cash
Collateral from the defendants
jointly and severally was
granted. Per Plaintiff’s relief
(e), it claims interest on the
sum of Five Hundred and Fifty
Thousand United States Dollars,
that is the Cash Collateral it
deposited into the 2nd
Defendant’s account was also
granted to be calculated from
February, 2016 at simple
interest to date of judgment.
Dissatisfied with the Judgment
of the High Court, the Plaintiff
appealed to the Court of Appeal.
The 1st Defendant
also filed Cross Appeal before
the Court of Appeal. The appeal
and cross appeal were dismissed
save that the Bank charges and
fees which were to be deducted
from the Cash Collateral of
USD550,000.00 to be refunded to
the Plaintiff. Still, not
satisfied with the decision of
the Court of Appeal, the parties
have appealed to the Supreme
Court.
HELD
Save the award of general
damages which is varied, ground
(c) of the cross of appeal is
succeeds in part. The
Plaintiff’s Appeal fails and it
is accordingly dismissed. The 1st
Defendant’s Cross Appeal
succeeds in part. The general
damages of GH¢5 Million is
hereby varied to GH¢1.5
Million.
STATUTES REFERRED TO IN JUDGMENT
Borrowers and Lenders Act, 2008
(Act 773)
Deposit-taking Institution Act,
2016 (Act 930
Contracts Act, 1960 (ACT 25),
CASES REFERRED TO IN JUDGMENT
Asante v Bogyabi [1966] GLR 232.
Butt v Barclays Bank Ghana Ltd
[2008] GMJ 188, 192 CA
Mulvenna v Royal Bank of
Scotlant (2003) AER 439
Transfield Shipping
Inc. Mercator Shipping Inc (The
Achilleas) (2008) 4 ALL ER 159,
Delmas Agency Ghana Ltd v Food
Distributors International Ltd
[2007-2008] SCGLR
NationaL Investment Bank &
Westec Security v ROM
Engineering Ltd [2015-2016] 1
SCGLR 766,
BOOKS REFERRED TO IN JUDGMENT
DELIVERING THE LEADING JUDGMENT
OWUSU (MS.), JSC:-
COUNSEL
EDWARD SAM CRABBE ESQ. FOR
PLAINTIFF/APPELLANT/APPELLANT/
APPELLANT.
TONY LITHUR ESQ. WITH JENNIFER
AMISSAH FOR 1ST
DEFENDANT/CROSS APPELLANT/CROSS
APPELLANT
_____________________________________________________________
OWUSU (MS.), JSC:-
On 13th February,
2020, the Court of Appeal,
Accra, dismissed all the grounds
of appeal filed by the
plaintiff/appellant/appellant
(to be referred to as
plaintiff). It also dismissed
Grounds (i), (ii), (iii), (iv),
(v), (vii), and (viii) of the 1st
Defendant’s/cross
appellant/appellant (to be
referred to simply as 1st
Defendant) cross-appeal. Ground
(vi) was upheld, whilst ground
(ix) was upheld in part with
regard to the sum to be
refunded.
Dissatisfied with the decision
of the Court of Appeal, the
Plaintiff filed the instant
appeal to the Supreme Court on
the following grounds;
a.
The Courts below occasioned for
the Plaintiff a grave
miscarriage of justice when
despite the positive evidence on
record, being 1st
Defendant’s own record, held
that 1st Defendant
actually issued the three Bank
Guarantees just because
Plaintiff had erroneously
believed that, the said Bank
Guarantees had been issued.
b.
That the findings of the Learned
Justices that Plaintiff should
refund bank charges associated
with the issuance of the Bank
Guarantees out of the cash
collateral (US$550,000.00) is
not borne out of the evidence on
record.
c.
That the refusal of the Court of
Appeal to enhance the award of
general damages assessed at five
million Ghana cedis
(GHc5,000,000.00 by the trial
court in the special
circumstances of this suit is
against the weight of evidence.
d.
That the Courts below ought to
have exercised their discretion
to enhance damages in the sum of
thirty million Ghana cedis
(GH¢30,000,000) to compensate
for at least the direct costs
and losses incurred by Plaintiff
as a result of the actions and
inactions of the 1st
Defendant.
e.
Additional grounds to be filed
upon receipt of the Record of
Appeal.
The 1st
Defendant/cross-appellant/cross-appellant
also appealed to this Court on
the following grounds;
(a)
The Court of Appeal failed to
pay due and/or proper regard to
the dictates of binding
precedent and legislation which
prevented the 1st
Defendant from returning the
blocked funds to Plaintiff
without due authorization of 2nd
Defendant.
(b)
In affirming the award of the
High Court of general damages
for Plaintiff in the sum of five
million Ghana cedis
(GH¢5,000,000.00), the Court of
Appeal erred in accepting the
High Court’s finding that,
failure by 1st
Defendant to transfer back to
the Plaintiff the blocked sum of
US$550,000 (less the bank
charges), was the reason for the
suspension by the Security
Exchange Commission of
Plaintiff’s license,
(c)
The Court of Appeal erred in
affirming wholly the basis upon
which the High Court awarded
Plaintiff general damages in the
sum of GH¢5,000,000.00
(d)
The judgment in relation to the
portions complained of, was
against the weight of evidence.
BACKGROUND OF THE CASE
Following discussions between
the Plaintiff a non-bank
financial institution which
provides financial and fund
management services represented
by its Managing Director, the 1st
Defendant bank in Ghana and 2nd
Defendant, a customer of 1st
Defendant, an Agreement was
reached between the parties for
the issuance of three Bank
Guarantees totaling US$550,000
to secure the delivery of Oil
Products from Nigeria to Ghana
at the instance of 2nd
Defendant. As a condition for
the issuance of the Bank
Guarantees, 1st
Defendant requested for Cash
Collateral in the sum of
US$550,000. The Plaintiff based
on the discussions between the
parties, issued written
instructions to 1st
Defendant on 7th
January, 2016, Exhibit “D” to
commence the transaction. The
Bank Guarantees were to last for
a period of 30 days. The Cash
Collateral deposited in 2nd
Defendant’s account by Plaintiff
was to be blocked in a pledged
account. It is the case of the
Plaintiff that, 1st
defendant failed to carry out
the instructions as contained in
Exhibit “D” and allowed 2nd
Defendant to withdraw the Cash
Collateral of US$550,000 in bits
over a period of six (6) months
hence the action in the High
Court against Defendants jointly
and severally claiming inter
alia the following reliefs;
a.
Special Damages of Ten Million
United States Dollars
{US$10,000,000) or its cedi
Equivalent of Forty Million
Cedis (GH¢40,000,000.00) for
loss of income.
b.
General Damages of One Hundred
Million Ghana Cedis
(GH¢100,000,000) for breach of
duty of care to the Plaintiff.
c.
General Damages of Thirty
Million Ghana Cedis
(GH¢30,000,000) for defamation.
d.
Recovery of the sum of Five
Hundred and Fifty Thousand
United States Dollars
(US$550,000) (blocked funds).
e.
Interest on the Five Hundred and
Fifty Thousand United States
Dollars (US$550,000).
f.
Cost including Legal fees.
In its Defence, the 1st
Defendant denied Plaintiff’s
claim and avers that, it
complied with the Written
instructions of the plaintiff.
Consequently, it is not liable
to any form of losses incurred
by the Plaintiff.
The 2nd Defendant
after causing an appearance to
be entered on its behalf did not
file a Defence nor participate
in the trial.
At the trial, the Plaintiff
testified through its Managing
Director and closed its case, 1st
Defendant testified through its
representative and called two
witnesses.
At the end of the trial,
Plaintiff’s relief (a), the
claim for Special Damages of Ten
Million United States Dollars or
its cedis equivalent for loss of
income was refused. Plaintiff’s
relief (b), the claim for
general damages was granted and
it was awarded five million
Ghana cedis (GH¢5,000,000). Its
claim for thirty million Ghana
cedis (GH¢30,000,000) for
defamation was refused. The
Plaintiff’s relief (d), the
claim for the recovery of Five
Hundred and Fifty Thousand
United States Dollars
(US$550,000), the Cash
Collateral from the defendants
jointly and severally was
granted. Per Plaintiff’s relief
(e), it claims interest on the
sum of Five Hundred and Fifty
Thousand United States Dollars,
that is the Cash Collateral it
deposited into the 2nd
Defendant’s account was also
granted to be calculated from
February, 2016 at simple
interest to date of judgment.
Dissatisfied with the Judgment
of the High Court, the Plaintiff
appealed to the Court of Appeal.
The 1st Defendant
also filed Cross Appeal before
the Court of Appeal. The appeal
and cross appeal were dismissed
save that the Bank charges and
fees which were to be deducted
from the Cash Collateral of
USD550,000.00 to be refunded to
the Plaintiff.
Still, not satisfied with the
decision of the Court of Appeal,
the parties have appealed to the
Supreme Court.
It is noted for the record that,
the Plaintiff did not file
additional ground of appeal as
indicated in its Notice of
Appeal.
From the lengthy submissions by
counsel for the parties, the
issue for determination in the
appeal before us is the award of
general damages of five million
Ghana Cedis to the Plaintiff.
Whilst the plaintiff complains
that the amount is woefully
inadequate, the 1st
Defendant insists that the
amount is excessive and harsh.
In her judgment, the High Court
held as follows;
“From the evidence on record,
although the conduct of the 1st
Defendant in failing to return
the Cash Collateral to the
Plaintiff’s account at the end
of the transaction gave the 2nd
Defendant the opportunity to
dissipate same causing the
Plaintiff to suffer the forgoing
financial injuries, I did not
think the Plaintiff should be
entitled to the specific losses
he has asked for but as I have
earlier ruled, it should be
entitled to damages
for that breach of duty”.
She concluded on the reason for
awarding Plaintiff general
damages of five million Ghana
Cedis this way;
“The liability of the Defendants
to pay damages to Plaintiff in
contract flow from the breach by
1st Defendant of the
terms of the Exhibit “D”, which
formed the contract between the
Plaintiff and 1st
Defendant. I have also concluded
previously in this judgment that
in tort, the 1st
Defendant breached its duty of
care owed to the Plaintiff which
caused the Plaintiff to suffer
losses. In assessing the measure
of damages to be awarded to the
Plaintiff, I have given
consideration to the peculiar
facts of the case and all the
hardships the Plaintiff has
suffered after February 2016
when the Cash Collateral ought
to have been returned. It is
therefore my considered opinion
that the Plaintiff should be
entitled to damages which
I hereby assess at Five
Million Ghana Cedis
(GH¢5,000,000.00)”. (See
page 587 to 588, Volume 2 of the
Record of Appeal).
So, the question is, what were
the hardships the trial Judge
took into consideration in
awarding the general damages of
five million Ghana Cedis?
In his witness statement and
testimony before the trial
court, the Plaintiff’s Managing
Director cataloged a list of
hardships the Plaintiff went
through or suffered as a result
of the failure of 1st
Defendant to return the Cash
Collateral of Five Hundred and
Fifty Thousand United States
Dollars to its account by
February, 2016. These include
the following:
1.
Cheques issued by Plaintiff for
the payments to its clients were
all dishonored.
2.
The returned cheques have caused
embarrassment to the Plaintiff
ranging from complaint made to
the Police and the Plaintiff’s
regulator, the Securities and
Exchange Commission.
3.
The Supplier further blacklisted
the Plaintiff Company.
4.
Plaintiff has since not been
able to pay returned cheque
amounts due the supplier and it
has since accrued interest cost
and charges.
5.
The Plaintiff was unable to turn
around the funds entrusted to
its care as fund manager thereby
causing operational
embarrassment and mishaps which
has led to loss of potential
income and all manner of legal
tussle against it.
6.
The refusal of 1st
Defendant to release the funds
to the Plaintiff in February,
2016 after the expiry of the
three financial instruments
meant Plaintiff’s resources for
investments were reduced and its
returns on investments
diminished such that the
Plaintiff suffered hardships
such that some employees had to
be laid off which also triggered
labour related issues.
7.
The refusal of 1st
Defendant to release the funds
to Plaintiff has led the latter
inability to undertake similar
transactions it has committed
itself to executing to earn a
respectable margin thereby
causing Plaintiff loss of
potential income.
8.
The refusal to release the funds
to Plaintiff has contributed to
its inability to honour its
payment obligations and this has
led to the following unfortunate
incidents;
a.
Several complaints made by
irritated clients to several
police stations one of which led
to the Plaintiff’s Managing
Director being locked up at the
Airport Police Station cells
from 15th April – 18th
April 2017 on a charge of breach
of trust and conspiracy to
commit crime.
b.
There have been personal
physical attacks on the
Plaintiff’s Managing Director
which resulted in bodily harm
and his vehicle, Toyota Camry
GW-1562-16 was ceased by angry
clients.
c.
Complaints from Plaintiff’s
clients to its regulator to
suggest that Plaintiff is a
fraudulent organization and that
it should not be trusted. This
has painted Plaintiff company in
a bad light and caused it to
loss its dignity among colleague
players.
d.
This has caused Plaintiff
Company not been able to pay
salaries and SSNIT on behalf of
its workers leading to criminal
summons instituted against it
and the Directors by the state.
e.
The complaints by clients of the
Plaintiff had led to the
suspension of the Plaintiff’s
operating license by SEC thereby
causing it to halt operations,
which suspension was published
in Ghanaian newspapers as well
as various online portals.
f.
Plaintiff’s landlord has ejected
Plaintiff from its business
premises due to its inability to
settle the annual rent required
by the landlord.
g.
That in an attempt to resolve
these difficulties, the
Plaintiff’s Managing Director
had to sell personal businesses
and also pledged personal assets
belonging to Directors and the
said funds were assessed at a
very expensive interest cost
with penal charges to be charged
on default.
In arguing the appeal, counsel
for the Plaintiff invited this
court to enhance the general
damages awarded the Plaintiff
taking into consideration the
hardships suffered by it on
account of 1st
Defendant’s refusal to return
the Cash Collateral back into
its account. Counsel for the
Plaintiff also insisted the 1st
Defendant did not issue the Bank
Guarantees as it claimed.
Therefore, the Court of Appeal
erred in ordering bank charges
and fees to be deducted from the
Cash Collateral 1st
Defendant has been ordered to
refund to the Plaintiff.
We think the argument of counsel
for the Plaintiff on the
issuance of the three bank
guarantees is flawed. In the
first place, the plaintiff
pleaded and testified that the
three bank guarantees were
issued and tendered Exhibit “F”,
“F1” and “F2” to back its claim.
The law is that;
“Where the evidence of one party
on an issue in a suit was
corroborated by witnesses of his
opponent, whilst that of his
opponent on the same issue stood
uncorroborated even by his own
witnesses, a court ought not to
accept the uncorroborated
version in preference to the
corroborated one unless for some
good reason (which must appear
on the face of the Judgment) the
court found the corroborated
version
incredible or impossible”.
See the case of ASANTE v
BOGYABI [1966] GLR 232.
Grounds (a) and (b) of the
Plaintiff’s appeal fail and they
are dismissed.
This brings us to the
cross-appeal of 1st
Defendant.
Counsel for 1st
Defendant in his submissions,
argued ground (a) and (d)
together. The import of these
two grounds is that, the Court
of Appeal failed to pay due and
proper regard to the dictates of
binding precedent and
legislation which prevented 1st
Defendant from returning the
blocked funds to Plaintiff
without the authorization of 2nd
Defendant. He referred us to a
number of foreign decisions and
the case of BUTT v BARCLAYS
BANK GHANA LTD [2008] GMJ 188,
192 CA, section 17 of the
Borrowers and Lenders Act, 2008
(Act 773) and section 146
of the Deposit-taking
Institution Act, 2016
(Act 930) and submitted
that, aside statutes, a valid
mandate is required in order to
permit a bank to activate
activity on a customer’s
account. Therefore, the
instructions contained in
Exhibit D to block the funds in
2nd Defendant’s
account could not be done. It
was only the 2nd
Defendant that can give
instructions for the funds to be
blocked.
He argued that, the nature of
the transaction the parties
contracted was a contract of
guarantee in favour of the 2nd
Defendant with Plaintiff being
the guarantor. The 1st
Defendant agreed to open letters
of credit (LCs) in favour of 2nd
Defendant to import Oil
Products. The Plaintiff
guaranteed 1st
Defendant’s risk for providing
the Letters of Credit to 2nd
Defendant by offering the Cash
Collateral against 1st
Defendant’s risk or loss if the
transaction between the 2nd
Defendant and third parties did
not go through and 1st
Defendant lost money. He
continued that, by Banking
practice, even though upon
Plaintiff’s instructions, the
Cash Collateral was transferred
into 2nd Defendant’s
account, the latter was the
customer of 1st
Defendant and the party who now
has the mandate over the funds
had to formally instruct 1st
Defendant to issue the guarantee
before it did. He therefore
submitted that, the actual
guarantees had to be issued not
on the basis of Exhibit “D”, but
upon the direct instructions of
2nd Defendant. This
was the only way to give Exhibit
“D”, business efficacy.
With all due respect to counsel
for 1st Defendant,
Exhibit “D” formed the basis of
the contract between Plaintiff
and 1st Defendant. If
the latter felt the instructions
contained in Exhibit “D” cannot
be carried out, it should have
made this known to the
Plaintiff. It is too late in the
day for 1st defendant
to say it was impossible to
carry out the instruction in
Exhibit “D”. Besides, by Section
5 (1) of the Contracts Act, 1960
(ACT 25), a contract can be made
for the benefit of a third
party. We are not persuaded by
this argument. The lower courts
therefore did not put a strained
interpretation on 1st
Defendant in the circumstances
of the transaction. On the
contrary both the High Court and
the Court of Appeal were right
when they held that 1st
Defendant is bound by Exhibit
“D”.
On the issue that, the general
damages of five million Ghana
Cedis awarded the Plaintiff was
harsh and excessive, counsel for
the 1ST Defendant
went through the list of
hardships Plaintiff alleged it
suffered and submitted that, the
trial judge failed to consider
the issues of foreseeability and
remoteness. Thus, the damages
claimed by Plaintiff was not
within the reasonable
contemplation of the parties as
arising from the default of 1st
Defendant. He referred us to the
cases of MULVENNA v ROYAL
BANK OF SCOTLANT (2003) AER 439
and TRANSFIELD SHIPPING
INC. MERCATOR SHIPPING INC
(THE ACHILLEAS) (2008) 4 ALL ER
159, and submitted that it
is not every foreseeable loss
that is claimable in damages. He
continued that; the law will
sometimes provide a cut-off
point for damages even if they
are foreseeable but unusual in
the ordinary scheme of things.
In addition, he argued that, in
determining whether or not the
damage is foreseeable or remote,
the basis being contractual, the
courts would ascertain whether
or not the kind of damage under
consideration is consistent with
commercial practice or
proportionate to the risk
undertaken by the party or the
benefit the party stood to gain.
So, the question is, what were
the alleged hardships the
Plaintiff suffered that the
trial Judge took into
consideration in awarding the
general damages in contention.
In her judgment, the trial Judge
held and rightly so that;
“I find in the circumstance, the
conduct of the 1st
Defendant to be unacceptable and
hold that the 1st
Defendant failed to transfer the
Cash Collateral back into the
Plaintiff’s account contrary to
the terms of Exhibit “D” and
that failure was deliberate”.
(See page 577 Volume 2 of the
Record of Appeal).
She further held that, the
Plaintiff was not entitled to
the estimated profit of two
million, two hundred and fifty
thousand Unites States dollars
within a maximum period of 30
days, translating to loss of
income of not less than ten
million United States dollars as
the time of the issuance of the
writ of summons. In rejecting
that claim the trial judge that;
“How was Plaintiff expecting to
make a profit on the sale of
products which were never
delivered? I do not think the
failure of the suppliers to
deliver the said oil products
can be laid at the door step of
the 1st Defendant”.
(See page 580 Volume 2 of the
Record of Appeal).
The trial judge also refused to
take into consideration in
awarding general damages to
Plaintiff the contracts
contained in Exhibit “L” and “M
series”. She held that;
“… the Plaintiff cannot claim
the specific profits that would
have flowed from these specific
contracts had they been executed
because at the time Plaintiff
entered into the contract with
the 1st Defendant,
these specific contracts were
never in the contemplation of
the parties, nor did the
Plaintiff make the 1st
Defendant aware of these
contracts and so the resultant
loss of profits under these
contracts cannot flow from the 1st
Defendant’s breach. In other
words, I find that they are too
remote in relation to the
default of the 1st
Defendant”.
(See page 583 Volume 2 of the
Record of Appeal).
The Plaintiff also claimed it
suffered reputational damage
among its peers and market
operators in the securities
industry from the numerous
complaints lodged against it by
its clients to its regulator;
the Stock Exchange Commission
(SEC). These complaints
according to Plaintiff led to
the suspension of its operating
license by the regulator.
Plaintiff also alleged it was
unable to pay rent and was
evicted from its corporate
offices. In addition, it was
unable to pay its workers SSNIT
Contribution. The cheques issued
by Plaintiff to pay its clients
matured investments too were
dishonoured and it tendered
Exhibit “S” SERIES, “U”, “V”
“G”, “H” and “K” to back its
claim.
The trial Judge in her Judgment
held that, the above
predicaments cannot be taken
into account in awarding damages
to the Plaintiff. This is
because;
“……. I find that the cheques
were dishonoured due to
Plaintiff’s own conduct of
issuing those cheques at a time
when it was aware there were
insufficient funds in its
accounts. In these
circumstances, it would be
unjust to hold the 1st
Defendant liable for Plaintiff’s
own conduct or for any fees and
charges that were levied on
those returned cheques by the 1st
Defendant”.
(See page 587 Volume 2 of the
Record of Appeal).
Therefore, contrary to counsel
for 1st Defendant’s
submission that the trial Judge
erroneously accepted the
sufficiency of the Exhibits
tendered by the Plaintiff as the
kind of damage suffered by it by
reason of 1st
Defendant’s breach of its
obligation to return the cash
collateral to Plaintiff without
considering the issues of
foreseeability and remoteness.
The trial Judge in fact did
consider the Exhibits one by one
and came to the conclusion that,
the alleged hardships cannot be
claimed by the Plaintiff as at
the time the contract was
executed between the parties,
these alleged hardships it
suffered were never within the
contemplation of the parties nor
did Plaintiff make 1st
Defendant aware of these
contracts. Therefore, the trial
Judge addressed the issue of
remoteness and foreseeability.
Grounds (a), (b), and (d) of the
cross appeal fail and they are
dismissed.
We now turn our attention to the
five million Ghana Cedis general
damages awarded Plaintiff.
The law is that, General Damages
are presumed to be the natural
or probable consequence of the
Defendant’s acts. The law
implies general damages in every
infringement of an absolute
right. See the case of DELMAS
AGENCY GHANA LTD v FOOD
DISTRIBUTORS INTERNATIONAL LTD
[2007-2008] SCGLR 748 holding
(3) of the headnotes where
their Lordships held that;
“Special damages is distinct
from general damages. General
Damages is such as the law
presume to be the natural and
probable consequence of the
defendant’s act. It arises by
inference of the law and
therefore need not be proved by
evidence. The law implies
general damages in every
infringement of an absolute
right. ……… Where the plaintiff
has suffered a properly
quantifiable loss, he must plead
specifically his loss and proved
it strictly. If he does not, he
is not entitled to anything
unless general damages are also
appropriate”.
See also the case of NATIONAL
INVESTMENT BANK & WESTEC
SECURITY v ROM ENGINEERING LTD
[2015-2016] 1 SCGLR 766, 769,
holding (3) where their
Lordships on the award of
general damages have this to
say:
“The award of general damages,
though regulated by settled
principles, like all acts of
judicial discretion, must be
applied on case-by-case basis.
(our emphasis) In the
instant case, it was clear that
the plaintiff had exaggerated
the extent of items removed from
the factory premises and
presented the court with a
version that was unreliable as
was found in exhibit B. On the
whole, in the absence of cogent
evidence of the materials taken
by those who had broken into the
factory premises, such as
inventory, which to be good,
could not be limited only to
that of July 2009, as there must
be credible evidence of the
machinery holding of the company
over a period to establish the
reasonable probability that, in
the light of those inventories,
as at the date of the
attachment, the extent of loss
claimed to have been suffered by
the plaintiff was more likely to
be true……”.
In awarding general damages to
the Plaintiff, the trial High
Court Judge held among other
things as follows:
“The liability of the Defendants
to pay damages to the Plaintiff
in contract flow from the breach
by 1st Defendant of
the terms of the Exhibit “D”,
which formed the contract
between the Plaintiff and the 1st
Defendant. I have also concluded
previously in this judgment that
in tort, the 1st
Defendant breached its duty of
care owed to the Plaintiff which
cause Plaintiff to suffer
losses. In assessing the measure
of damages to be awarded to the
Plaintiff, I have given
consideration to the peculiar
facts of the case and all the
hardships the Plaintiff has
suffered after February 2016
when the Cash Collateral ought
to have been returned. It is
therefore my considered opinion
that the Plaintiff
should be entitled to damages
which I hereby assess at Five
Million Ghana Cedis (GH¢5,000,000.00)”.
Relating the cases referred to
supra to the case under
consideration, having come to
the conclusion that, the alleged
hardships the Plaintiff claimed
it has suffered as a result of
the 1st Defendant’s
default in returning the Cash
Collateral cannot be laid at the
doorstep of the latter, we think
the award of Five Million Ghana
Cedis general damages is on the
high side. Whilst we concede
that the conduct of 1st
Defendant is reprehensible
because, Plaintiff as a
financial service provider needs
its capital to meet its
financial obligations such as
paying clients their investment
capital and their returns, when
the capital is held back, it is
deprived of other business
opportunities such as the one
that resulted in the present
action. Coupled with the fact
that, the 1st
Defendant held onto the Cash
Collateral for forty-three (43)
months. We however think the
general damages of Five million
Ghana Cedis awarded Plaintiff is
rather on the high side. We say
so for the simple reason that
the 1st Defendant was
ordered by the High Court to
refund the Cash Collateral with
interest which the latter had
paid. Ordinarily, this Court
will not interfere with the
exercise of a discretion by the
lower Courts unless the exercise
of that discretion was not done
judiciously. Having ordered 1st
Defendant to refund the Cash
Collateral with interest, we
think the award of GH¢1.5
million general damages would be
appropriate in the peculiar
circumstances of this case.
Save the award of general
damages which is varied, ground
(c) of the cross of appeal is
succeeds in part.
The Plaintiff’s Appeal fails and
it is accordingly dismissed. The
1st Defendant’s Cross
Appeal succeeds in part. The
general damages of GH¢5 Million
is hereby varied to GH¢1.5
Million.
M. OWUSU (MS.)
(JUSTICE OF THE
SUPREME COURT)
ANIN YEBOAH
(CHIEF
JUSTICE)
G.
PWAMANG
(JUSTICE OF THE
SUPREME COURT)
N.
A. AMEGATCHER
(JUSTICE OF THE
SUPREME COURT)
I. O. TANKO AMADU
(JUSTICE OF THE SUPREME COURT)
COUNSEL
EDWARD SAM CRABBE ESQ. FOR
PLAINTIFF/APPELLANT/APPELLANT/
APPELLANT.
TONY LITHUR ESQ. WITH JENNIFER
AMISSAH FOR 1ST
DEFENDANT/CROSS APPELLANT/CROSS
APPELLANT |
