HOME         UNREPORTED  CASES OF THE COURT

 OF

AUTHOMATED COURTS ACCRA 

IN THE SUPERIOR COURT OF JUDICATURE  IN THE HIGH COURT OF JUSTICE HELD IN ACCRA ON FRIDAY, THE 31ST  DAY OF OCTOBER, 2008 BEFORE HIS LORDSHIP MR. JUSTICE S.H. OCRAN.

SUIT NO. BL/265/2007

                                              RAFI ALUMINIUM COMPANY LIMITED

                                                       VRS

                                   1.         WALID DAKMAK

2.         RADWAN DAKMAK

J U D G E M E N T

The plaintiff, a limited liability company filed a writ which was accompanied by a statement of claim on 19^th February 2007 and claimed certain reliefs. On the 4^th of December 2007, the plaintiff amended its writ and statement of claim with leave of the court. The reliefs are as follows:

1. Recovery of possession of the first and/ or second floor of the premises known as plot number 18 Ring Road South Industrial Area, Accra, let to the defendant and/or any other portion of the premises that may be occupied by the defendants.

2. Mesne profits

3. Further or other reliefs

4. Cost

The defendants filed a defence and counterclaimed for the following:

i.              Arrears of rent from 1^st January 2006 up to date of Judgement at the rate of one thousand dollars or its cedi equivalent per month

ii.            Mesne profits from the date hereof to the date of judgement.

iii.           Ejectment from the ground floor showroom occupied by the plaintiff on grounds of non- payment of rent.

The basis of the plaintiff’s claim is that plot number 18, Ring Road South Industrial Area, Accra, (herein after referred to as plot number 18) is a government plot which was granted by the Government on lease to Ghana Furniture Manufacturing Company Ltd (herein after referred to as the company) for 50 years from 10^th December 1959. The company was to put up structures on the plot to be used for industrial purposes only. The company however assigned its interest in plot number 18 to the plaintiff at a time that it had rented part of the premises to the plaintiff and the other part to the defendants for a term of ten years with five years option effective from 1^st March 1996. The defendant had also then subletted part of its sublease to the plaintiff. The plaintiff claimed that since it had acquired the whole plot number 18, and the defendants’ 10 year sublease had lapsed, the defendants should vacate from the premises because they needed the place for their own business. The plaintiffs also claimed that the defendants are using the premises as residential instead of using it for industrial purposes and were also a nuisance to them.

The defendants’ case is that they had a total of 15 year tenancy from the company, which tenancy is to expire in 2011. Since the company’s lease expires on 2009, by operation of law, the defendants’ tenancy has become an assignment of the lease.

The defendants’ further case is that the company knew they were using the premises as residential instead of using it as industrial but they said nothing. The plaintiff is therefore estopped from ejecting them from the premises they occupy on grounds of using it as residential. On the other hand, since their tenancy had become assignment and the plaintiffs are their tenants, the plaintiff should pay rent to them for the place they occupy.

The issues set down to be determined at the close of the pleading were as follows:

1. Whether or not the plaintiff has been granted a lease of the entire premises from the government of Ghana for a term of 50 years.

2. Whether or not the lease granted by the government of Ghana covers the portion occupied by the defendants.

3. Whether or not the lease granted to GFM by the Government of Ghana was granted solely for business purposes.

4. Whether or not the assignment from GFM to the plaintiff covered the entire premises.

5. Whether or not the sublease between the plaintiff and the defendants has been extinguished by reason of the assignment by GFM of its entire interest in the premises to the plaintiff.

6. Whether or not the tenancy agreement between GFM and the defendants constitutes an assignment of GFM’s interest to the defendant.

7. Whether or not the defendant is entitled to rent from the plaintiff.

8. Whether or not the plaintiff is entitled to an automatic right of forfeiture.

9. Any other issues arising from the pleadings.

At the close of the respective cases of the parties, it came out that most of the issues set down for trial were no issues at all and this can be found in the closing addresses of the parties.

Two important issues which were not raised in the original issues but were raised in the reply to the plaintiff’s address are as follows:

i.              Whether or not the new lease taken by the plaintiff from the Government and dated 21^st February 2007 terminated all rights of the plaintiff.

ii.            Whether or not the plaintiff can rely on the new lease granted by the Government to the plaintiff.

These will be considered after the resolution of the original issues.

From exhibits A, B and D, it is clear that plot number 18, Ring Road Industrial Area, Accra is the land covered by these documents.

Exhibits B and D stated that the plot should be used for industrial purposes only and in exhibit A, the parties agreed that the covenants in exhibit B which included a usage clause will be adhered to.

Apart from the exhibits tendered the plaintiff also gave evidence that it acquired the whole premises known as plot number 18, Ring Road, Industrial Area, Accra and that it was for industrial purposes only.

I therefore hold that the plaintiff had been granted leasehold of plot number 18, Ring Road Industrial Area, Accra and the said lease covers the area occupied by the defendant. It was also leased or granted for industrial purposes only.

Even though the assignment granted by the company to the plaintiff covered the entire premises, it never extinguished the defendants’ tenancy until it expired. By the assignment, the plaintiff assumed all the rights and liabilities attached to the plot. The defendant therefore became the tenant of the plaintiff and until the tenancy expired, the defendant was to remain in occupation. It is for this reason that the plaintiff instituted this action to eject the defendant when it deemed that the sub- tenancy had expired.

The defendants however raised an important issue from their pleading and evidence that by their tenancy with the company, which they deem to exceed that of the company, they had become the owners of the premises. This, I believe is the main issue whose resolution will lead to the resolution of the remaining issues. That was set down as following:

Whether or not the tenancy agreement between GFM and the defendant constitute an assignment of GFM’s interest to the defendant.

The defendants have argued that since their sub tenancy gave them an initial tenancy of 10 years with effect from 1^st March 1996, with an option to renew for another 5 years, they will have a sub tenancy of 15 years which will expire on 2011; and that since their landlord i.e. GFM’s lease will expire on 2009, it meant they the defendants have a longer sub tenancy than their landlord, ‘GFM’ and therefore by operation of law, the sub tenancy has become an assignment. The defendants relied on the case of Milmo vrs Carreras (1946) 1KB 306.

It must be stated that Milmo vrs Carreras (Supra) is distinguishable from this case. That case was decided under the English statute of Law of Property Act of 1925, whereas Ghana has its own Rent Act (Act 220) and the Conveyancing Act (1973) N.R.C.D. 175. Again, the terms in the Milmo agreement is different from the terms in this case.

In the Milmo case, it was for one year from 1^st November 1943 and thereafter quarterly until any of the parties give 3 months notice in writing to terminate. The rent was also the same. It also contained a clause that the tenant was to deliver up at the termination of the term to the landlord. Milmo was described as the landlord but Landlord was defined to include ‘the person or persons for the time being entitled to the reversion immediately expectant on the term hereby created. On the basis of the agreement, the tenancy continued on quarterly basis at the agreed rent for some time before Milmo served notice on Carreras to quit; at that time his own lease had expired. One of the reasons that Lord Green M. R gave for his judgement was that Milmo could not give notice to determine a non existing term and that the obligation on Carreras to deliver up possession could not be construed as a mere contractual obligation between Milmo as an individual and Carreras, since Milmo had nothing left in the head lease. On the other hand, the covenant to deliver up at the termination of the term was expressed to be a covenant with the landlord, who was the person, entitled to the reversion and therefore since Milmo had divested himself of his entire interest in the flat, Carreras was bound to deliver up possession to the head landlord.

In this present case, the defendant was given a tenancy of 10 years certain from 1^st March 1996 with option for 5 years. The 10 years expired on 28^th February 2006. The Company’s lease was to expire on 9^th December 2009, leaving it a period of 3 years, 10 months.

Since the company assigned its interest to the plaintiff on 1^st April 2005, the plaintiff became the owner of the unexpired interest in Exhibit ‘B’.

The ten year certain sub- tenancy granted to the defendant expired on 28^th February 2006, and unlike the Milmo case where the quarterly tenancy continued till Milmo’s lease expired, the plaintiff still had some years left. The plaintiff however informed the defendant that it was not going to agree to the 5 year option.

In exhibit I, which is the tenancy agreement between the company and the defendant, it was made clear that the 10 years was certain. It also indicated the total rent to be paid and the mode of payment. The first five year rent of ¢22,500,000.00 was to be paid on the execution of the lease. The rent for the remaining 5 years was to be paid as follows:

1. First instalment of ¢11,250,000.00 on 15^th January 1996.

2. Second instalment ¢5,625,000.00 on 15^th June 1996.

3. Third instalment ¢5,625,000.00 on 15^th December 1996.

Exhibit I did not state what the 5 year option meant. As indicated in the written address of defence counsel, an option may be for a renewal, extension or continuation. Since the agreement was concluded between the defendants and the company, they are in a better position to tell us what they meant by the phrase ‘5 year option’ in exhibit I.

In the case of Akim Akroso Stool and ors vrs Akim Manso Stool and ors (1989- 1990) 1GLR 100, the Court of Appeal held that “What the words in a document meant could only be derived from the document itself. The intention of the parties had to be gathered from the written instrument. The function of the Court was to ascertain what the parties meant by the words which they had used. The Court was to declare the meaning of what was written in the instrument and not what was intended to have been written so as to give effect to the intention expressed; for it was not permissible to guess the intention of the parties and substitute the presumed intention for the intention”

Since it is not clear form Exhibit I what the Company and the defendant meant by 5 year option, the meaning of it should be found in the same document. With regard to the 10 years certain the total rent for it was stated and the mode of payment was also stated. All the total rent for the 10 years was to be paid within the same 1996, the year that the agreement was concluded. Nothing was said about the rent for the 5 years after the first 10 years.

Taking cognisance of how the Ghana cedi looses value and considering the fact that the landlord may undertake some repairs, the initial monthly rent of ¢375,000.00 agreed upon for the 10 years certain, all of which was to be paid within 1996, may not be the same rent to be paid in 2006 for the 5 year option. The parties, in Exhibit 1, showed subsequently that their 5 year option meant a renewal but not a continuation nor an extension.

In Exhibit ‘E’, the defendants wrote to the company on 12^th September 2005 as follows: “We wish to inform you that we decided to renew the five year option which is mentioned in the agreement dated 3/1/1996 …”

The company replied by exhibit ‘F’ dated 21/11/05 as follows:

1. Our lease expires on 3^rd of March 2005 which leaves three (3) years, ten (10) months and not five (5) years like mention in the agreement.

2. The lease has not been renewed.

3. For any renewal, please contact Rafi Aluminium Co. He holds the remaining years for the lease

My understanding of exhibit ‘F’ is that the company was saying they were left with only 3 years, 10 months, so they could not even give 5 years renewal, since they had then not renewed their tenancy of the place. If, however, they wanted a renewal, they should contact the plaintiff.

Again, in Exhibit ‘G’ defendants counsel wrote “… on a sublease for a term of ten years certain from 1^st day of March 1996 with an option to renew it for another term of five years”. In paragraph 4, of the defence to amended statement of claim, the defendants said, “… in addition to the term of ten years, it gave them an option to renew it for a further term of five years…”

Since the defendants and the company considered the 5 year option to be a renewal, the defendants cannot now claim that the 5 year option should be construed to be an extension or continuation. I therefore hold that in exhibit I, the five year option is a renewal but not an extension or continuation. I am fortified in this because the parties in exhibit 1 did not agree on the rent for the five years and the mode of payment. With regard to the 10 years certain, the rent and the mode of payment were all stated.

If, however, the sub- tenancy is taken to be for 15 years as contended by counsel for the defendants, then the sub- tenancy will offend against Section 22 subsection 2 of the Rent Act (Act 220). The said subsection states as follows:

“A person in the case of a tenancy of premises other than the tenancy specified in subsection (1) shall not sub- let those premises in the absence of express agreement in writing to the contrary for a period in excess of the period of the tenancy.”

If the company’s tenancy expires in 2009 but the defendants’ sub-tenancy is to expire in 2011, then by section 22 subsection 2 of the Rent Act (Act 220) the whole sub- tenancy will be void.

In this case, since I have already held that the 10 years sub tenancy is certain but the 5 year option is for renewal, section 22 (2) of the Rent Act will not affect the tenancy since it is only 10 years sub tenancy that was agreed upon.  From the foregoing, I hold that the defendants’ sub tenancy from the company did not become an assignment by operation of law.

Another issue which was set down to be determined is issue ‘e’ which is; whether or not the sublease between the plaintiff and the defendant has bee extinguished by reason of the assignment by GFM of its entire interest in the premises to the plaintiff.

By the pleading and the evidence before me, and my holding that the defendant acquired a 10 year certain sub tenancy form the company before the assignment of the unexpired interest to the plaintiff, the defendants’ interest in the sub tenancy was not extinguished. However, since the defendant had then Sublette part of its portion of the premises to the plaintiff for valuable consideration, the defendants’ interest in that part of the premises subletted to the plaintiff, who had become the owner, ended, when the 10 year sub tenancy expired on the last day of February 2006. The defendant is therefore not entitled to any rent from 1^st March 2006 from the plaintiff with regard to the portion subletted to them since they were then occupying the place as owners.

From 1^st March 2006, the defendants became monthly tenants for the time they occupied the premises and the plaintiff can recover possession upon proof of any of the grounds in the Rent Act (Act 220).

In this case, the plaintiff is ejecting the defendants on grounds of:

1. Using the premises as residential instead of industrial, this is in breach of the tenancy agreement.

2. Nuisance, as in section 17 ‘1C’

3. For the use of the landlord’s business as the lease had expired, as in  section 17 ‘1h’

4. For challenging the landlord’s title

There is enough evidence that the defendant had been using the premises for residential purposes instead of industrial purposes. The defendants admit that they are using it as residential but say the company knew of this use but said nothing to them and since the plaintiff took the assignment at a time that the company had not protested, they, the Plaintiffs can also not protest.

The defendant did not call any witness from the company to testify that they knew of the use of the premises as residential but they agreed to that use, apart form their bare assertion. It is however noted that in exhibit ‘A’ it was agreed between the plaintiff and the company that the covenants in the head lease which is exhibit ‘B’ will be observed. Section 26 of Conveyancing Act (1973) N.R.C.D 175 says:

“A covenant relating to an interest in land of a covenantor or land capable of being bound by him, shall, unless a contrary intention is expressed, be deemed to be made by the covenantor on behalf of himself, his successors in title and the persons deriving title under him or them and shall be enforced against such successors to the extent as against the covenantor. Section 26 subsection 3 states that “For the purposes of this section in connection with covenants restrictive of the user of land, ‘successors in title’ shall be deemed to include the owners and occupiers for the time being of such land”.

It therefore follows that even if exhibit I did not include the user clause, the defendants would have been bound by the user clause in exhibit ‘B’. The user clause was however inserted in exhibit I and therefore the defendants’ contention that the company did not raise objection to their use of the premises as residential will not protect them since the Government can use it against the plaintiff, the ultimate owner.

In the case of Mensah vrs Cofie (1991) 1GLR 254, Mr. Justice Ampiah J.A as he then was held that “An important distinction should be drawn between continuing and non continuing breaches of a covenant, for acceptance of rent after breach of a covenant waived the forfeiture only up to the date of distress or payment of rent. The proviso for re- entry might be enforced if the breach subsequently continued …”

In this case, even if the company did not re- enter the premises when the defendant used it as residential, the plaintiff can re-enter now that they have become the new owners and the defendants are still using the premises as residential instead of using it for industrial purposes. The plaintiff by their exhibit ‘M’ dated 28^th June 2006, requested the defendants to stop using the premises as residential and that should they fail and/or refuse to comply, the plaintiff will exercise the right of re- entry.

Since the defendants admit that they are still in occupation as residential users, the plaintiff can recover possession of the premises on this ground alone.

The plaintiff also pleaded nuisance and gave evidence that the defendants have been pounding fufu in the house daily; they walk up and down, kill chicken and cook all kinds of food and the scent goes to the plaintiff’s factory. The plaintiff also gave evidence that the defendants have built a generator house without any permission. The defendant admitted this through cross- examination of the plaintiff as follows:

Q. The other day, you were complaining about pounding of fufu and the rest of it.

A. Yes, my Lord

Q. Before the assignment to you, fufu was being pounded there.

A. Yes, my Lord, I protested against that one too. It brought a hole down to up, so if you want to pound fufu, you have to come down.

Q. You are also now complaining about the pounding of fufu in that place.

A. Yes, my Lord

Q. I am suggesting to you that your company cannot object to the use of that place for pounding of fufu.

A. My Lord, I remember one day I went with my wife from Ghana to a place to rent 2^nd floor, and the lady said your wife is a Ghanaian so she cannot give us the 2^nd floor for my wife to eat fufu. I do not accept anybody to pound fufu …

Since the defendants admits to the pounding of fufu and the cooking of all kinds of meals which the plaintiff complains of, the plaintiff can also recover possession under section 17 ‘1C’ of the Rent Act (Act 220) as held in Mensah vrs Addison (1981) GLR 784 where it was held that where a tenant was guilty of conduct which constituted nuisance or an annoyance to adjoining occupiers, he automatically forfeited his right of occupation of the premises under Act 220 and the landlord was entitled to and might come to court direct for ejection if the tenant refused to quit.

The plaintiff also served notice on the defendants that they needed the premises occupied by the defendants for their own use. The notice was tendered as exhibit ‘N’ and is dated 28^th June 2006. The plaintiff also gave evidence on this as follows:

Q. Now can you tell the court why you want them out of the place?

A. Because I want to use it for my own business. In fact, the place that they occupy as a residential area is all offices, and they have changed it into residence. But where I am it is all used for factory and warehouse but we don’t have offices.

The defendants did not challenge this, but rather pleaded and gave evidence that they were not tenants of the plaintiff. Since I have already held that the plaintiff is the owner of the premises, and by operation of law, the defendants are tenants, the inability of the defendant to controvert the evidence that the plaintiff required the premises for its own business, also entitles the plaintiff to recover possession under section 17 ‘1h’ of Act 220.

The defendants could not challenge the plaintiff on this because even when the company gave them a ten year sub tenancy for industrial purposes, the defendants had no use of it so they subletted a portion of their sub tenancy to the plaintiff before the plaintiff had an assignment of the whole premises. Since the premises has been leased out for industrial purposes only but the defendants are using their portion for residential and subletted the other part to the plaintiff for its industrial use and the lease has also expired, the plaintiff can also recover on the grounds that it required the premises for its own use under section 17 ‘1h’ of Act 220.

The defendants have also challenged the title of the plaintiff and keeps on challenging the plaintiff’s title. This is amply demonstrated by the defendants’ pleading in paragraph 19 of the defence to amended statement of claim and the counterclaim for rent from the plaintiff. The defendants also gave evidence that until 2011, the premises given to them by the company is theirs and the plaintiff must pay them rent.

In Safo and Anr vrs Badu (1977) 2 GLR 63, it was held that the common law rule was that a tenant who repudiated the title of his landlord was automatically made to forfeit his lease …. The tenant by denying that he had a tenancy was taken to waive any notice to quit, and the landlord could claim possession at once and no relief was available against forfeiture. The same position was held in Quartey vrs Entertainment and Tourist Development Co. Ltd and ors (1992) 2 GLR 298. The plaintiff is therefore also granted recovery of possession on the ground that the defendants have challenged its right to the premises.

On whether or not the new lease taken by the plaintiff terminated all rights it held before the said lease and whether or not the plaintiff can rely on the new lease. I have no hesitation in stating that the new lease did not terminate any right of the plaintiff. This is so because I have already held that the defendants’ sub tenancy expired on the 28^th of February 2006. After that date, the defendant became a monthly statutory tenant. Since the plaintiff took its new lease on 21^st February 2007, at a time that it had about two more years to run, no matter the interpretation that is put on the new lease, it will have no effect on the defendants’ occupation of the premises since as at the time the new lease was executed, the defendants’ lease had lapsed.

Again, since the plaintiff’s right in plot number 18 was to expire by the old lease in 2009, by the principle of Nemo Dat quod non Habeat, the Government of Ghana had no right to lease the same plot to the plaintiff, at a time that the plaintiff was the owner. In Dovie and Dovie vrs Adabunu (2005-2006) SGLR 905, the Supreme Court relying on the dictum of Adade JSC in Hammond vrs Odoi (1982- 83) 2 GLR 1215 at 1304 held that “an effective customary conveyance divested the grantor of any further right, title, or interest in the land to convey or grant to subsequent grantee …. Her subsequent deed of gift to the defendant was therefore a nullity.” A better interpretation of the plaintiff’s new lease should be that it is effective from 9^th December 2009, the time that the old lease is to expire.

In this case, there is no evidence that the plaintiff executed a lease surrendering the old lease. No reason was also given as to why it was backdated to 1^st July 2006. This date on the new lease might be a mistake in the calculation of when the old lease expires. Be it as it may, since form the old lease, the plaintiff was the owner as at the last day of February 2006 when the defendants’ sub-tenancy expired and by the new lease in exhibit ‘D’, the plaintiff has another 50 year lease, the plaintiff can continue to exercise all the rights that it had before the new lease was granted even if the old one was surrendered since the Government itself had given its consent to the assignment in Exhibit ‘B’ and must therefore wait till 9^th December 2009, since until that date it has no interest capable of transfer.

The last issue to be determined is whether it is the plaintiff who is entitled to recover rent from the defendant or vice versa. Since I have held that the defendants’ interest in his part of the premises expired on 28th February 2006, the plaintiff is under an obligation to pay rent to the defendant for the months of January and February 2006 since the plaintiff admits that it paid rent up to 31^st December 2005 for the area given to it by the defendants. The defendants put the rent at the cedi equivalent of one thousand dollars a month. The plaintiff will therefore pay to the defendant the cedi equivalent of two thousand dollars for January and February 2006.

Since the defendant also continued to occupy the premises after its sub tenancy had expired, the defendants must also pay rent for the period commenced from 1^st March 2006 to the end of October 2008. The defendants gave evidence that his premises given out to the plaintiff is almost the same as what he occupied. Since the plaintiff demanded the cedi equivalent of one thousand dollars a month, it is fair that the defendant also pays the same as rent especially as the plaintiff said the last rent was negotiated in 2003. From 1^st March 2006 to 31^st October 2008 is 32 months. This brings the rent as at the end of October 2008 to Thirty- two thousand dollars.

The defendant is therefore to pay to the plaintiff the cedi equivalent of thirty- two thousand dollars. If, however, the defendants continue to occupy the premises after 31^st October 2008, they will then continue to pay the cedi equivalent of one thousand dollars for every month.

In the result, I hold that the plaintiff is entitled to the following:

1. Recovery of immediate possession of every part of the premises known as plot number 18 Ring Road, South Industrial Area, Accra, occupied by the defendants.

2. Recovery of the sum of thirty- two thousand dollars at its cedi equivalent as rent from 1^st March 2006 to 31^st October 2008 less the sum of two thousand dollars being the assessed rent the plaintiff is to pay to the defendants for the months of January and February 2006.

3. Additional rent of one thousand dollars a month at its cedi equivalent from 1^st November 2008 till the date that the defendants vacate from plot number 18 Ring Road, South Industrial Area, Accra.

The defendants’ counter claim is dismissed except the rent for two months assessed rent of two thousand dollars.

There will be cost of Four Thousand Ghana Cedis, (GH¢ 4,000) against the Defendants in favour of the Plaintiff.

                                                             (SGD.) MR. JUSTICE S.H. ORCRAN

                                                                 (Justice of the High Court)