|
Practice and
Procedure - Judgment-debtor -
Judgment creditor – Award of
interest - Amount of interest
due – Garnishee - Post-judgment
rate of interest – Whether or
not post judgment interest rate
payable is the rate prevailing
as at the date of payment is
unsupportable in law - Order 42
r15 of the High Court (Civil
Procedure) Rules 1954 (LN 140A)
- Article 157(2) of the 1992
Constitution.
HEADNOTES
The
respondent in this case filed a
motion ex parte for a
garnishee order nisi
directed at banks where the
appellant has accounts the
respondent had obtained judgment
in the Supreme Court against the
appellant and that the appellant
had paid into court
905,735,855.00 cedis and a
further $1,535,437.50.These
payments had been made in
satisfaction of a Supreme Court
order in this case The Court
awards interest only on the
replacement value of the vessel
assessed at $600,000 at the US
dollar rate as stipulated by the
Bank of Ghana and as per the
Court of Appeal decision; from
the date of beaching to the date
of judgment, or its cedi
equivalent and at the
440,649,992.25 cedis together
with interest at the prevailing
bank rate from the date of
beaching – 9th March
2001 – to the date of judgment,
29th July 2004. On
receiving copies of the letters
accompanying the appellant’s
payments into court, the
respondent wrote to the
appellant drawing its attention
to the fact that post judgment
interest was also payable on the
amounts and, in the case of the
US dollar amounts, not at the
Bank of Ghana dollar base rate,
but at a US dollar prime rate
The deponent referred to above
stated that the appellant did
not reply to this letter. The
deponent further averred that as
at 29th January 2007
what remained unpaid of the
judgment debt was US £204,095.00
and 690,959,127.00 cedis (being
mainly post-judgment interest
and the use of the wrong rate of
interest in the calculation of
the US dollar interest rate.)
It was in relation to these
amounts that the respondent had
applied for the garnishee order
nisi. The order nisi was granted
by the High Court, but it was
subsequently discharged, , by
the court subject to the court’s
order that interest be paid on
the sum of 440,649,992.25 cedis
at the 91 day treasury bill rate
from 1st August 2004
to 31st December 2006
and further that interest be
paid on the sum of $600,000 at
the US dollar rate as stipulated
by the Bank of Ghana from 1st
August 2004 to 31st
December 2006. The respondent,
being aggrieved by the ruling of
the High Court containing these
orders, appealed to the Court of
Appeal. The Court of Appeal
allowed the appeal and set aside
the orders of the High Court
relating to the dollar component
of the judgment debt. It is
from this unanimous judgment of
the Court of Appeal that the
appellant has appealed to this
Court.
HELD
Clearly, the
starting date for the
calculation of this
post-judgment interest is
erroneous. It is hereby amended
to 15th November
2006, the date of the delivery
of the Supreme Court’s judgment
and orders. Subject to this
amendment, we would dismiss
Additional Ground A of the
appellant’s appeal. The Court
of Appeal was not in error in
applying CI 52 to this case and,
in any case, that application
was not retroactive.
On the facts
of this case, that would be the
bank rate prevailing on 15th
November 2006, when the Supreme
Court made its order. The
appeal thus partially succeeds
on this point and the Court of
Appeal’s order is hereby varied
to conform with rule 4 of CI
52. In other words, the US
dollar rate of interest to be
applied to the dollar component
of the judgment debt should be
that prevailing as at the date
of the delivery of the Supreme
Court’s judgment and orders.
Thus, subject
to the variations (supra) of the
Court of Appeal’s orders
relating to the payment of
post-judgment interest on the
dollar component of the judgment
debt, the appeal is dismissed.
STATUTES
REFERRED TO IN JUDGMENT
(Award of
Interest and Post Judgment
Interest) Rules 2005 (C.I 52)
High Court
(Civil Procedure) Rules 2004 (CI
47)
High Court
(Civil Procedure) Rules 1954 (LN
140A).
1992
Constitution.
CASES
REFERRED TO IN JUDGMENT
CCWL v Accra
Metropolitan Assembly
[2007-2008] SCGLR 440
Da Costa v
Ofori Transport Ltd. [2007-2008]
SCGLR 602,
Dupaul Wood
Treatment (Ghana) Co. Ltd &
Duffour v Asare [2005-2006]
SCGLR 667
Antwi v NTHC
Suit No. 54/12/2008,4th
February 2009 and
Yungdong
Industries Ltd v Roro Services &
Ors [2005-2006] SCGLR 816
BOOKS
REFERRED TO IN JUDGMENT
DELIVERING
THE LEADING JUDGMENT
DR. DATE-BAH,
J.S.C:
COUNSEL
TETTEH & CO.
FOR THE APPELLANT
E. S. GOKA
FOR THE RESPONDENT
______________________________________________________________________
J U D G M E N T
______________________________________________________________________
DR. DATE-BAH,
J.S.C:
This is the
unanimous judgment of the Court.
FACTS
This case
relates to a dispute about the
amount of
interest due from a
judgment-debtor to a
judgment
creditor.
The
respondent in this case filed a
motion ex parte on 16th
July 2007 for a garnishee order
nisi directed at banks where the
appellant has accounts.
In her affidavit in support of
this motion, the
Managing-Director of the
respondent deposed to the fact
that the
respondent had obtained judgment
in the Supreme Court against the
appellant on 15th
November 2006 and that the
appellant had on 3rd
January 2007 paid into court
905,735,855.00 cedis and a
further $1,535,437.50 by March
2007.These payments had been
made in satisfaction of a
Supreme Court order in this case
which was in the following
terms:
“The
decision of this court is
unanimous. The appeal fails in
part and succeeds in part only
ie on the ground dealing with
the award of the sum of
$2,658,300 as an indemnity for
the respondent’s tort, as well
as interest etc.
The cross
appeal succeeds in part only,
that is on question of costs
only and fails on all the other
grounds. In this regard, the
cost awarded in the Court of
Appeal is assessed as c50
million cedis.
Costs would
be assessed at c50m.
This Court
awards interest only on the
replacement value of the vessel
assessed at $600,000 at the US
dollar rate as stipulated by the
Bank of Ghana and as per the
Court of Appeal decision; from
the date of beaching – 9th
March 2001- to the date of
judgment, 29th July
2004 or its cedi equivalent and
at the 440,649,992.25 cedis
together with interest at the
prevailing bank rate from the
date of beaching – 9th
March 2001 – to the date of
judgment, 29th July
2004.
Loss of Use
This Court
assesses the loss of use as
$900,000 (NINE HUNDRED THOUSAND
DOLLARS ONLY).”
On receiving
copies of the letters
accompanying the appellant’s
payments into court, the
respondent wrote to the
appellant drawing its attention
to the fact that post judgment
interest was also payable on the
amounts and, in the case of the
US dollar amounts, not at the
Bank of Ghana dollar base rate,
but at a US dollar prime rate.
The
deponent referred to above
stated that the appellant did
not reply to this letter. The
deponent further averred that as
at 29th January 2007
what remained unpaid of the
judgment debt was US £204,095.00
and 690,959,127.00 cedis (being
mainly post-judgment interest
and the use of the wrong rate of
interest in the calculation of
the US dollar interest rate.)
It was in relation to these
amounts that the respondent had
applied for the garnishee order
nisi.
The order
nisi was granted by the High
Court on 17th July
2007, but it was subsequently
discharged, on 31st
July 2007, by the court subject
to the court’s order that
interest be paid on the sum of
440,649,992.25 cedis at the 91
day treasury bill rate from 1st
August 2004 to 31st
December 2006 and further that
interest be paid on the sum of
$600,000 at the US dollar rate
as stipulated by the Bank of
Ghana from 1st August
2004 to 31st December
2006. The respondent, being
aggrieved by the ruling of the
High Court containing these
orders, appealed to the Court of
Appeal. It complained about the
learned trial judge’s
application of “the US dollar
rate as stipulated by Bank of
Ghana” as the
applicable
post-judgment rate of interest,
instead of what it considered to
be the statutorily sanctioned
post-judgment rate of interest.
It also complained about the
trial judge’s refusal to apply
the statutorily sanctioned
post-judgment rate of interest
on the damages of $ 900,000
awarded it for loss of use.
The Court
of Appeal allowed the appeal and
set aside the orders of the High
Court relating to the dollar
component of the judgment debt.
It ordered that post
judgment interest be paid on the
dollar component at the current
prevailing rate in the United
States of America till final
payment.
It is from
this unanimous judgment of the
Court of Appeal that the
appellant has appealed to this
Court.
Before this Court, the appellant
has based its case on the
following two Additional Grounds
of Appeal:
“ADDITIONAL
GROUND A
Their
Lordships erred in applying
Court
(Award of Interest and Post
Judgment Interest) Rules 2005
(CI52) retroactively.
ADDITIONAL
GROUND B
Their
Lordships holding that
post
judgment interest rate payable
is the rate prevailing as at the
date of payment is unsupportable
in law.”
THE LAW
The
appellant’s case in its appeal
to this Court is constructed on
a false premise, namely, that
the judgment referred to in the
Court (Award of Interest and
Post Judgment Interest) Rules,
2005 (CI 52) is necessarily the
judgment of the trial court,
rather than that of the
appellate court which gave the
final judgment in the case. Rule
2(1) of the Court (Award of
Interest and Post-Judgment
Interest) Rules 2005 provides
that “Subject to subrule (2)
each judgment debt shall bear
interest at the statutory
interest rate from the date of
delivery of the judgment up to
the date of final payment.”
Because an appeal, in the
Ghanaian jurisdiction, is by way
of rehearing, the operative
judgment for the purposes of
this provision of CI 52 should
ordinarily be the final judgment
of the appellate court. There
are several Supreme Court
judgments which impliedly affirm
this proposition. The statutory
pre-judgment interest rate
applies between the date of
accrual of the cause of action
till the date of final judgment
by the final appellate court,
when so ordered by the court.
The post-judgment interest rate
then applies from that date, by
operation of law. Thus, for
instance, in
CCWL v
Accra Metropolitan Assembly
[2007-2008] SCGLR 440-441
the Supreme Court said:
“Accordingly,
we order that the defendant
should pay the plaintiff the net
award made by the learned trial
court judge in the passage
quoted above. In accordance
with the Court (Award of
Interest and Post Judgment
Interest) Rules, 2005 (CI 52),
the Defendant is ordered to pay
interest on the amount awarded
to the Plaintiff at the bank
rate prevailing today with
effect from the date of
termination of the contract,
that is, 29th June
2001 till the date of payment.”
Clearly, the
Supreme Court’s holding here
implies that the judgment by
reference to which any
post-judgment interest rate
should apply is its own
judgment. It holds that the
pre-judgment interest rate
should apply from the date on
which the cause of action arose
till the date of its own
judgment, not the date of the
High Court judgment. There are
other Supreme Court judgments to
the same effect.
For instance,
the Supreme Court in
Da Costa
v Ofori Transport Ltd.
[2007-2008] SCGLR 602,
unanimously held (at p. 609-610)
as follows:
“In the
result, after a diligent perusal
of the plaintiffs’ Statement of
Case, we have not found any
reason why the judgment of the
Court of Appeal should, subject
to the order we are about to
make on interest, be disturbed
and we accordingly dismiss this
appeal as being without merit.
However, we
have decided to modify the
judgment of the Court of Appeal
by awarding interest on the
damages ordered by the Court. In
accordance with Rule 1 of the
Court (Award of Interest and
Post Judgment Interest) Rules,
2005 (CI 52), we order that the
damages of four million cedis
awarded by the Court of Appeal
are to bear interest at the
prevailing bank rate from the
date of the accrual of the cause
of action, namely, the date of
the first breach of the covenant
to inform about sublets, till
judgment today.
…
From today,
the plaintiffs are, of course,
automatically entitled to the
payment of interest on the
judgment debt at the
post-judgment statutory interest
rate specified in Rule 2 of CI
52, namely, the prevailing bank
rate again, or where there is
doubt as to the prevailing rate,
the 91 days Treasury Bill rate
as determined by the Bank of
Ghana, till the date of payment.
The appeal is
dismissed, subject to this new
order as to interest.”
Other Supreme
Court decisions to like effect
include:
Dupaul Wood Treatment (Ghana)
Co. Ltd & Duffour v Asare
[2005-2006] SCGLR 667 at p.
695;
Antwi v NTHC (Suit No.
54/12/2008, unreported judgment,
delivered on 4th
February 2009 and Yungdong
Industries
Ltd v Roro Services & Ors
[2005-2006] SCGLR 816, at p. 848
where Justice Date-Bah said:
“Accordingly,
the damages that I would award
are what would be equivalent to
the value, as at 25 March 1994,
of the goods converted, together
with interest from that date to
the date of the final orders of
this court.”
These cases
show that the application of CI
52 to the facts of this case
does not involve retroactivity.
The relevant legislation
applicable on the date of the
judgment of the Supreme Court,
on 15th November
2006, was CI 52. That
legislation authorised the
Supreme Court to award
pre-judgment interest on the
judgment debt that it adjudged.
Post-judgment interest would
then follow as a matter of law.
The fact that the Supreme Court
chose to limit the period of the
pre-judgment interest it
awarded so that it would
terminate on the date of the
judgment of the High Court does
not take away its statutory
authority to award the said
pre-judgment interest rate. In
view of the interpretation
given by the Supreme Court to CI
52 (supra), it was open to the
Supreme Court to have decided
that the interest payable by the
appellant should be up to the
date of the judgment of the
Supreme Court. The fact that it
did not do so does not derogate
from the applicability of CI 52
to its judgment, even though the
enactment came into force after
the giving of the High Court
judgment in this case.
Accordingly, in our view, the
appellant’s Additional Ground A
is misconceived. Additional
Ground A, as already stated, is
to the effect that: “Their
Lordships erred in applying the
Court (Award of Interest and
Post Judgment Interest) Rules
2005 (CI 52) retrospectively.”
The appellant’s case is that
the judgment
of the High Court was given on
29th July 2004, at
which date the Court (Award of
Interest and Post Judgment
Interest) Rules, 2005 (CI 52)
had not yet come into force.
The applicable rate for
post-judgment interest rate at
the date of the High Court
judgment was 4% interest under
Order 42
r15 of the High Court (Civil
Procedure) Rules 1954 (LN 140A).
The appellant
expresses the quintessence of
its argument as follows (in
paragraphs 2 and 3 of its
Statement of Case):
“2. The
controversy between the parties
concerned the post judgment
interest payable on the above
debts. The controversy arose
because on 29 July 2004 when the
High Court pronounced its
judgment, the post judgment
interest rate was no more than
4% under Or 42 r 15, LN 140A.
In the course of the appellate
proceedings, the
High
Court (Civil Procedure) Rules
2004 (CI 47) repealed LN
140A on 3 January 2005 and
substituted a higher rate of
interest in the Court (Award of
Interest and Post Judgment
Interest) Rules 2005 (CI 52).
In its written submissions in
the Court of Appeal, the
respondent herein insisted on
the application of CI 52 from 29
July 2004 although it came into
effect much later. The
respondent explained the basis
of such retroactive application
of CI52 in its written
submissions in the Court of
Appeal that:
“though the
judgment was dated 29 July 2004,
and at the relevant time Order
42 r 15 of the High Court (Civil
Procedure) Rules 1954 (LN 140A)
was applicable, as yet by virtue
of the appeals lodged by the
respondent, by the time
execution or the enforcement of
the judgment was sought to be
performed, LN 140A had been
repealed. And CI 52 is
applicable and no court of law
could allow a repealed
legislation to be used. It
would amount to a situation of
suing a dead person ...”
1.
Their
Lordships in the Court of Appeal
held that CI 52 was a procedural
legislation and operated
retroactively from 29 July 2004
to date; further, that post
judgment interest was payable at
the current prevailing rate in
the USA as at the date of
payment.”
The
culmination of the appellant’s
argument is that the Court of
Appeal’s alleged retroactive
application of CI 52 is
unconstitutional. This is how
it puts its case in its
Statement of Case (at paragraph
6):
“Indeed, the
retroactive application of CI 52
is unconstitutional. For,
article 107 of the 1992
Constitution prohibits such
retroactive legislation as would
impose a burden, obligation or
liability on any person except
as permitted under the
Constitution. The provision in
effect prohibits retroactive
interpretation and application
of any statute. Admittedly,
there would be no objection to
retroactivity so long as no
burden, obligation or liability
is imposed on any person, and
this explains the exception of
procedural legislation...”
There are at
least two answers to this
argument. The first is that
article 107 is inapplicable to
the facts of this case, since it
refers exclusively to
Parliament, whilst CI 52 is made
by the Rules of Court Committee,
pursuant to power conferred upon
it by
Article 157(2) of the 1992
Constitution. Article 107
provides as follows:
“Parliament
shall have no power to pass any
law –
(a)
to
alter the decision or judgment
of any court as between the
parties subject to that decision
or judgment; or
(b)
which
operates retrospectively to
impose any limitations on or to
adversely affect the personal
rights and liberties of any
person or to impose a burden,
obligation or liability on any
person except in the case of a
law enacted under article 178 to
182 of this Constitution.”
It is obvious
from the express language of
this provision that it has no
applicability to this case.
Secondly, the statutory power to
award interest that was
exercised by the Supreme Court
in its order quoted supra was
not deployed retroactively.
Rule 1 of CI 52 provides as
follows:
“If the court
in a civil cause or matter
decides to make an order for the
payment of interest on a sum of
money due to a party in the
action, that interest shall be
calculated
(a)
at the
bank rate prevailing at the time
the order is made, and
(b)
at
simple interest
but where an
enactment, instrument or
agreement between the parties
specifies a rate of interest
which is to be calculated in a
particular manner the court
shall award that rate of
interest calculated in that
manner.”
When the
Supreme Court decided on 15th
November 2006 to award
pre-judgment interest on the sum
representing the replacement
value of the vessel the
subject-matter of the original
suit in this case, it was in
effect exercising power under
rule 1 of CI 52, which was in
force then, although it did not
say so expressly. It was open
to the Supreme Court to award
interest from the date the cause
of action arose up until the
date of their judgment, pursuant
to rule 1. The fact that the
court, in exercising its
discretion, limited the period
for the payment of interest to
end on the date the High Court
gave its judgment does not
convert its award into a
retroactive award. This Court
has no power in this appeal to
disturb that award by the
Supreme Court. In my view,
however, any post-judgment
interest which is payable by
operation of law (under rule 2
of CI 52) became payable from
the date of the Supreme Court’s
judgment (and not that of the
High Court). Therefore, the
interpretation put by the
respondent on rule 2 of CI 52
for the purposes of levying
execution in this case was
erroneous and should not have
been supported by the Court of
Appeal. Kusi Appiah JA,
delivering the unanimous
judgment of the Court of Appeal
on this point said (at p. 109 of
the Record):
“Guided by
the decision in DUPAUL WOOD
TREATMENT case (supra), I hold
that the sums or judgment debt,
(i.e. $600,000.00 replacement
value of vessel and US $
900,000.00 damages for loss of
use) adjudged payable by the
Supreme Court to the
Plaintiff/Appellant are to bear
post judgment interest in
accordance with the Court (Award
of Interest and Post Judgment
Interest) Rules, 2005 (CI 52)
from 29 July, 2004 to date of
final payment that is January,
2007.”
Clearly, the
starting date for the
calculation of this
post-judgment interest is
erroneous. It is hereby amended
to 15th November
2006, the date of the delivery
of the Supreme Court’s judgment
and orders. Subject to this
amendment, we would dismiss
Additional Ground A of the
appellant’s appeal. The Court
of Appeal was not in error in
applying CI 52 to this case and,
in any case, that application
was not retroactive.
We will next
consider Additional Ground B.
There is merit in this ground in
that the Court of Appeal erred
in ordering that “Post Judgment
interest on the Dollar component
should be paid at the current
prevailing Bank rate in the USA
as at the date of payment.”
(See p. 109 of the Record.)
Rule 2 of CI 52 provides that
each judgment debt shall bear
interest at the statutory
interest rate from the date of
delivery of the judgment up to
the date of final payment. This
statutory interest rate is
defined in Rule 4 as “the bank
rate prevailing at the time the
judgment or order is made by the
court.”
On the facts of this case, that
would be the bank rate
prevailing on 15th
November 2006, when the Supreme
Court made its order. The
appeal thus partially succeeds
on this point and the Court of
Appeal’s order is hereby varied
to conform with rule 4 of CI
52. In other words, the US
dollar rate of interest to be
applied to the dollar component
of the judgment debt should be
that prevailing as at the date
of the delivery of the Supreme
Court’s judgment and orders.
The appellant
also sought to argue its
original ground (i) to the
effect that the Court of Appeal
erred in awarding post judgment
interest rate on the US dollar
debt at the prevailing interest
rate in the US and urged that
the 4% exigible under Order 42
rule 15 of LN 140A should be the
applicable rate. In the light
of the exposition of the law
above, it is obvious that this
ground has no merit and it is
hereby dismissed.
Thus, subject
to the variations (supra) of the
Court of Appeal’s orders
relating to the payment of
post-judgment interest on the
dollar component of the judgment
debt, the appeal is dismissed.
DR. S.K.
DATE-BAH
(JUSTICE OF
THE SUPREME COURT)
S. O. A. ADINYIRA (MRS)
(JUSTICE OF
THE SUPREME COURT)
J.V. M. DOTSE
(JUSTICE OF
THE SUPREME COURT)
ANIN YEBOAH
(JUSTICE OF
THE SUPREME COURT)
P. BAFFOE-BONNIE
(JUSTICE OF
THE SUPREME COURT)
COUNSEL:
TETTEH & CO.
FOR THE APPELLANT
E. S. GOKA
FOR THE RESPONDENT |
