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Supreme Court - Invoking the
supervisory jurisdiction -
Anti-money Laundering Amendment
Act, 2014 (Act 874) Freezing of
Accounts - Jurisdiction
- Whether or not
interested party can
freeze an accounts of a company
for more than one year - Whether
or not High Court exceeded its
jurisdiction when it dismissed
the application for a defreeze
of accounts and release of funds
when the statutory period of 12
months had long lapsed -
Whether or not
investigation of allegation of
fraud, which is criminal in
nature, is not affected by the
effluxion of time.- Whether or
not interested party and the
learned judge can relie on the
affidavit in the motion struck
out in the repeated motion to
refuse the application
HEADNOTES
The uncontroverted facts of this
application appear to be very
simple. The applicant is a
limited liability company
operating in this country. It
operated three accounts at the
Tower branch of Fidelity Bank,
Ghana Limited. the interested
party herein (The Financial
Intelligence Centre), in a
letter, directed the applicant’s
bank to freeze all the accounts
of the applicant, Not
comfortable with the freezing of
its accounts, the applicant
company filed a motion praying
the court to set aside the
freezing order granted against
them. This application to
defreeze the accounts was struck
out for want of prosecution
Later, on
the applicant filed an
application praying the same
court to defreeze the accounts
frozen by the same court on
which was clearly over one year
-
HELD -
We
accordingly hold that the High
Court lacked the jurisdiction to
order the continuous freezing of
the accounts of the applicant.
In sum, we think the applicant
has made a clear case on the
merits to warrant our
supervisory jurisdiction. We
hereby quash the order of the
learned High Court Judge dated
the 1st June 2015 for the
reasons canvassed above.The
application for certiorari is
thus granted as prayed.
STATUTES REFERRED TO IN JUDGMENT
Anti-money Laundering Amendment
Act, 2014 (Act 874)
High Court [Civil Procedure]
Rules CI 47 of 2004
1992 Constitution Article 23
CASES REFERRED TO IN JUDGMENT
REPUBLIC V DISTRICT MAGISTRATE,
ACCRA; EX PARTE ADIO [1972] 2
GLR 125
REPUBLIC V FAST TRACK HIGH
COURT, ACCRA; EX PARTE ELECTORAL
COMMISSION [2005-2006] SCGLR
514,
REPUBLIC V HIGH COURT KOFORIDUA
EX PARTE ASARE [2008-2009] 2 GLR
750
Barber v Mackrell [1879] 12 Ch
D.534
AWUNI v WEST AFRICAN
EXAMINATIONS COUNCIL [2003-2004]
SCGLR 471
BOOKS REFERRED TO IN JUDGMENT
Atkin’s Encyclopedia of Court
Forms in Civil Proceedings [2nd
edition) volume 3
DELIVERING THE LEADING JUDGMENT
ANIN YEBOAH JSC:-
COUNSEL
ALEXANDER AFENYO MARKIN ESQ.
WITH HIM KORKOR OKUTU FOR THE
APPLICANT
ARTHUR CHAMBERS ESQ. FOR THE
INTERESTED PARTY.
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RULING
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ANIN YEBOAH JSC:-
The applicant herein has invoked
our supervisory jurisdiction to
quash a ruling of an Accra High
Court, [Financial Division],
dated the 1st of June
2015. The uncontroverted facts
of this application appear to be
very simple. The applicant is a
limited liability company
operating in this country. It
operated three accounts at the
Tower branch of Fidelity Bank,
Ghana Limited. On 27/02/2014,
the interested party herein (The
Financial Intelligence Centre),
in a letter, directed the
applicant’s bank to freeze all
the accounts of the applicant.
As the interested party is
statutorily conferred with such
authority, the bank complied to
freeze all the three accounts of
the applicant. According to the
interested party, in an
affidavit sworn to by one Mary
Shireen Ofosu, an analyst of the
Financial Intelligence Centre,
the applicant on 20/02/2014
received an amount of
US$43,569.45 from one Sue
Batth-Tait in Canada. Prior to
the 20/02/2014 the same Sue
Batth-Tait had remitted the
applicant US$33,999.00. The
interested party’s officials
questioned two directors of the
applicant’s company; namely:
DAVID OMARI and ISAAC BOATENG
who according to the officials
of the interested party could
not provide credible information
for the remittances and they
therefore suspected the
applicant company of money
laundering. After the freezing
order initiated by the
interested party herein on
4/03/2014, it applied for and
successfully obtained from the
High Court, [Financial Division]
Accra, a confirmation order
freezing all the three accounts
of the applicant in an ex parte
application.
Not comfortable with the
freezing of its accounts, the
applicant company on 27/08/2014
filed a motion praying the court
to set aside the freezing order
granted against them. This
application to defreeze the
accounts was struck out for want
of prosecution on 5/09/2014.
Later, on 9/04/15, the applicant
filed an application praying the
same court to defreeze the
accounts frozen by the same
court on 5/03/2014, which was
clearly over one year. The
interested party herein opposed
the application.
It did not file any
comprehensive affidavit in
answer to the motion but learned
counsel made it clear to the
learned judge that he would rely
on the affidavit in answer filed
earlier on in the motion which
was struck out for want of
prosecution on 5/09/2014. We
shall consider this point later
in this delivery.
In the course of hearing the
application, the learned High
Court Judge suo motu requested
one Isaac Boateng, a director of
the applicant company to appear
in court to answer certain
allegations apparent on the
affidavit of the interested
party filed in the motion which
was struck out for want of
prosecution. The said Isaac
Boateng was not available to be
examined on the affidavit.
The application to defreeze,
however, was heard and the
learned judge in a lengthy
ruling on 1/06/2015, concluded
as follows:
“…I find that there are too many
questions and pointers to what
might be a fraudulent
transaction which the court has
notice of. Unfortunately, the
applicant’s directors are
unwilling or unable to make
themselves available to settle
these queries.
By granting this application,
this court would, in my view, be
condoning an illegality under
some other technical guise. It
would not be in the interest of
justice to do so”.
The applicant company does not
complain in this application
before us, that the initial
procedure leading to the
freezing of the accounts were
not in order. However, it has
raised a legal issue that under
the Anti-money Laundering
Amendment Act, 2014 (Act 874)
the interested party cannot
freeze the accounts of the
company for more than one year
and that the statute under
reference does not even provide
for extension of the one year
and therefore the court had no
jurisdiction to keep the
freezing order beyond the one
year.
The applicants have thus prayed
us by this motion to quash the
ruling of the learned High Court
judge dated the 1/06/2015 on the
following grounds:
a.
The High Court exceeded
its jurisdiction when it
dismissed the application for a
defreeze of accounts and release
of funds filed on 9/04/2015 when
the statutory period of 12
months had long lapsed.
b.
The High Court exceeded
its jurisdiction when it relied
on an affidavit in opposition
filed on 5/09/2014 in a previous
application when same had been
struck out for want of
prosecution on 5/09/2015.
c.
The freezing of all the
accounts of the applicant was
done in breach of the rules of
natural justice.
On the first ground, learned
counsel for the applicant
argued, that, since the statute
under which the jurisdiction to
freeze accounts limits the
courts jurisdiction to freeze
the accounts for only one year,
the High Court has no
jurisdiction beyond one year to
keep the freezing order in
place. To fully appreciate this
line of argument it would
suffice to state the statute on
which counsel anchored his
argument. The said section 23A
of the Anti-Money Laundering
Amendment Act, 2014 (Act 874))
states thus:
“An accountable institution
shall preserve the funds, other
assets and instrumentalities of
crime for a period of one year
to facilitate investigations”
Counsel for the interested party
does not doubt the time period
fixed by the law for the
operation of the freezing
order. In a rather lengthy
affidavit in answer to this
application, one Acheampong
Opoku, a financial analyst of
Financial Intelligence Centre
had this to say in paragraphs
23, 24 and 25 thereof as
follows:
“23. That I have further been
advised by lawyers for the
Interested Party and I verily
believe same to be true that
even though the statutory period
of twelve (12) months, during
which time an accountable
institution could preserve
frozen funds for the
facilitation of investigation
had elapsed, the processes
on the docket of the suit were
unaffected, hence the reliance
on same by the Applicant herein
to file its motion dated 9th
April, 2015.
24. That in specific response to
paragraphs 5,6,7,8,9 and 10 of
the Applicant’s affidavit in
support of the instant motion,
the interested party will say
that investigation of
allegation of fraud, which is
criminal in nature, is not
affected by the effluxion of
time.
25. that the directors of the
Applicant herein were reluctant
to make themselves available
when the High Court [Financial
Division] directed that they
appeared in court to speak to
the issue of the forged passport
that was used to open the
Applicant’s account at the
Fidelity Bank Ghana Limited”
We have quoted at length the
factual basis of the interested
party’s position and the
legitimate reasons for keeping
the applicant’s accounts frozen
over one year.
It may be factually true that
the allegations of fraud had
basis but that is not the issue
at stake in these proceedings.
The statutory provision which
was invoked against the
Applicant was to prevent the
applicant from dealing with the
frozen accounts for that one
year period; so as to enable the
Financial Intelligence Centre
(the interested party) herein to
conduct any investigations into
the transaction to ascertain
whether the transaction has any
traces of criminality to warrant
the freezing of the accounts.
One is compelled to assume that
in this era of information
technology and international
co-operation among nations, one
whole year should be enough for
the Financial Intelligence
Centre to unearth any wrongdoing
in the transaction under
consideration. The mere fact
that fraud may connote
criminality should not be used
as an opportunity to
indefinitely freeze the accounts
of the applicant, when the law
under which the interested party
is relying on does not vest it
with power to do so.
The question is this: is the
High court vested with
jurisdiction to freeze the
account for over one year? We
think that the statute does not
vest that jurisdiction in the
High Court to do so. It has
jurisdiction to freeze and
defreeze an account but the
statute does not vest it with
authority to keep the accounts
frozen for more than one year.
Learned counsel for the
applicant has referred us to the
case of the REPUBLIC V
DISTRICT MAGISTRATE, ACCRA; EX
PARTE ADIO [1972] 2 GLR 125
to argue that even though the
High court had jurisdiction to
entertain the matter the order
made to keep the accounts
frozen beyond one year destroyed
its jurisdiction. In the said
case Acher JA (as he then was)
at page 132 said:
“It is of vital importance to
appreciate that when the term
“excess of jurisdiction” is
used, it may mean that from the
inception of the case, the court
has no jurisdiction whatsoever
because the nature of the case
or the value involved is beyond
its jurisdiction. But it may
also mean that although the
Court has jurisdiction to hear
the case, the orders which the
court can pronounce are
restricted by statute. If an
order is therefore beyond the
powers of the court, it is
perfectly correct to say that it
has exceeded its jurisdiction”
(emphasis ours)
We think this proposition of law
clearly settles the matter. The
High court undoubtedly has
jurisdiction to hear the matter
but it is clear beyond doubt
that it had no jurisdiction to
order the continuous freezing of
the accounts beyond one year.
The learned judge was therefore
left with no discretion in the
matter at the stage when the
court’s jurisdiction was invoked
to defreeze the accounts beyond
the one year. As the learned
judge ordered otherwise to keep
the freezing of the accounts
beyond the one year she
destroyed the jurisdiction
vested in the court. We
accordingly hold that the High
Court lacked the jurisdiction to
order the continuous freezing of
the accounts of the applicant.
We would have rested our
decision at this stage of this
delivery as this court in a
cluster of cases like;
REPUBLIC V FAST TRACK
HIGH COURT, ACCRA; EX PARTE
ELECTORAL COMMISSION
[2005-2006] SCGLR 514,
REPUBLIC V HIGH COURT
KOFORIDUA EX PARTE ASARE
[2008-2009] 2 GLR 750 has
established the time-honoured
principle of law that when there
is an apparent want of
jurisdiction, certiorari should
issue by a supervising court.
However, learned counsel for the
applicant raised another
procedural issue of whether the
court erred in relying on an
affidavit in support of an
earlier motion which had been
struck out for want of
prosecution.
As it was pointed out earlier in
this delivery, the first
application to defreeze the
accounts was struck out for want
of prosecution. However,
learned counsel for the
interested party and the learned
judge relied on the affidavit in
the motion struck out in the
repeated motion to refuse the
application to defreeze.
According to counsel for the
applicant as the motion was
struck out it had ceased to be
operative and the court could
not rely on same. None of the
counsel in this case referred
this court to any decided case
on this issue. However, Order
20 rule 13 of the High Court
[Civil Procedure] Rules CI 47 of
2004 offers some assistance.
The rule states as follows:
“13 (1) An original
affidavit may be used in any
proceedings if it bears a filing
stamp.
(2) Where an original
affidavit is used it shall be
filed with the Registrar.
(3) Where an affidavit has
been filed, an office copy of it
may be tendered in any
proceedings.”
We think that order 20 rule 13
(1) resolves the issue under
consideration. The nature of an
affidavit is well captured in
the authoritative works in
Atkin’s Encyclopedia of Court
Forms in Civil Proceedings
[2nd edition) volume 3 at page
343 as follows:-
“An affidavit is a written
statement of evidence, sworn by
the person making it, who is
called the deponent, before a
person authorised to take
affidavits, and where
admissible, receivable in legal
proceedings as evidence either
in support of an application, or
in answer or reply.”
Affidavits are commonly used in
interlocutory applications to
provide factual basis in support
or answer to depositions. In
Barber v Mackrell
[1879] 12 Ch D.534 the court
formed the opinion that an
affidavit which is used in
proceedings can be used for
purposes if relevant, since it
is a form of evidence on oath.
In this application under
consideration, the deponent was
available for cross-examination
if requested by the court and
there was also indication from
counsel for the interested party
that he was going to rely on it
which to us constitutes fair and
sufficient notice to the
applicant, thereby avoiding any
element of surprise.
We think that the learned trial
Judge’s reliance on the
affidavit was supported by law
and we accordingly reject this
ground of the application as
unmeritorious.
The last ground touches on the
breach of the rules of natural
justice. We understand learned
counsel for the applicant in his
simple submissions on this
ground that, as some money which
stood in the accounts before the
alleged money laundering had
nothing to do with the transfer
from Canada, the learned Judge
ought not to freeze the whole
accounts without hearing the
applicant. On record, learned
counsel for the interested party
had little to say in answer to
the submissions of counsel for
the applicants on this point.
It is plain that the freezing
order affected the whole
accounts without limiting it to
the alleged illegal transfers
which culminated in the freezing
order. We think that moneys
which stood in the accounts of
the applicants before any
alleged illegal transfers into
the accounts should not form
part of the freezing order.
If a trial Judge is invited by
the Financial Intelligence
Centre to do so, it should
provide the court with
compelling evidence and notice
of the application should be
given to the victim of the
freezing order. As applicant was
denied the opportunity to be
heard as regards the money not
forming part of the alleged
money laundering, but
nevertheless had the entire
accounts frozen, we hold that
the court denied the applicant a
fundamental requirement of the
common law that is the audi
alteram partem rule. This has
always been a ground for
certiorari and since this
application has already been
granted on the ground of
jurisdictional error, it would
be sheer pedantry to cite
several cases to support this
proposition of law. We will,
however, sound a caution to the
interested party in this
Constitutional dispensation by
referring to Article 23 of the
1992 Constitution and the case
of AWUNI v WEST
AFRICAN EXAMINATIONS COUNCIL
[2003-2004] SCGLR 471, 514 where
Sophia Akuffo JSC said as
follows:
“In my view, the scope of
Article 23 is such that there is
no distinction made between acts
done in exercise of ordinary
administrative functions and
quasi-judicial administrative
functions. Where a body or
officer has an administrative
function to perform, the
activity must be conducted with,
and reflect the qualities of
fairness, reasonableness and
legal compliance”
In sum, we think the applicant
has made a clear case on the
merits to warrant our
supervisory jurisdiction. We
hereby quash the order of the
learned High Court Judge dated
the 1st June 2015 for the
reasons canvassed above.
The application for certiorari
is thus granted as prayed.
ANIN YEBOAH
JUSTICE OF THE SUPREME COURT
P. BAFFOE-BONNIE
JUSTICE OF THE SUPREME COURT
V. AKOTO -
BAMFO (MRS.)
JUSTICE OF THE SUPREME COURT
A. A. BENIN
JUSTICE OF THE SUPREME COURT
J. B. AKAMBA
JUSTICE OF THE SUPREME COURT
COUNSEL
ALEXANDER AFENYO MARKIN ESQ.
WITH HIM KORKOR OKUTU FOR THE
APPLICANT
ARTHUR CHAMBERS ESQ. FOR THE
INTERESTED PARTY. |
