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Banking -
section
47 - Anti-Money Laundering Act,
2008 (Act 749), Fraudulent deal
- Section 161 - Evidence Act
N.R.C.D 323 – Article 132 - 1992
Constitution - Certiorari -
Whether or not the trial judge
exceeded her jurisdiction-
Whether or not the the freezing
order should have been
restricted to this particular
transaction only -.
HEADNOTES
The Applicant
operates an account with Ecobank
(Ghana) Ltd, hereafter called
the Bank. In or around July 2013
an inward remittance of
US$10,000.00 was credited to the
Applicant’s account domiciled at
the Kotobaabi branch of the
Bank. The Applicant was duly
notified of the remittance by
the Bank via a text message. The
Applicant could not access the
money because his account was
frozen by the Chief Executive
Officer (CEO) of Financial
Intelligence, interested party
herein. The High Court confirmed
the freezing of the account by
an order dated 24th
October 2013 upon an application
ex parte by the CEO brought
under section 47 of the
Anti-Money Laundering Act, 2008
(Act 749), hereafter called the
Act. The Applicant made an
application to the High Court to
set aside the order and defreeze
the account. In response to the
said application the CEO
produced what appeared to be a
report emanating from the United
States Federal Bureau of
Investigations (FBI) and
purporting to implicate the
Applicant in some fraudulent
deal resulting in the transfer
to his account, the
subject-matter of this action.
The Applicant complains that he
was denied a hearing before the
High Court made the order of 24th
October 2013. He also complains
that the FBI report was accepted
by the court in utter disregard
of the provisions of section 161
of the Evidence Act. These
complaints have precipitated the
present application to this
court
HELD
Thus our
conclusion is that the order
should have been limited to the
$10,000 transaction and not the
entire account. To the extent
that the trial court froze the
entire account of the Applicant
it went beyond what was required
of her and thus exceeded her
power or authority or
discretion. Thus we would vary
the order to read: that $10,000
lodged into Applicant’s account
numbered 043301442815801
domiciled at Kotobaabi branch of
Ecobank Ghana Ltd be frozen and
same lodged in the Respondent’s
exhibit account with Bank of
Ghana pending investigations
into the source of the funds.
Subject to the above variation
the application should be
dismissed.
STATUTES
REFERRED TO IN JUDGMENT
Anti-Money
Laundering Act, 2008 (Act 749)
Evidence Act
N.R.C.D 323
1992
Constitution
CASES
REFERRED TO IN JUDGMENT
TSIMPINOS V.
ALLIANZ (AUST) WORKERS’
COMPENSATION (SA) Pty. Ltd.
(2004) 88 SASR 311; (2004) 233
LSJS 300
BOOKS
REFERRED TO IN JUDGMENT
Black’s Law
Dictionary 9th
Edition
DELIVERING
THE LEADING JUDGMENT
BENIN, JSC:-
COUNSEL
HON.
ALEXANDER KWAMENA AFENYO
MARKIN ESQ. WITH HIM MISS
BERNINA KORKOR OKUTU FOR THE
APPLICANT.
ARTHUR
CHAMBERS FOR THE INTERESTED
PARTY.
_____________________________________________________________________________________
RULING
_____________________________________________________________________________________
BENIN, JSC:-
This is an
application for judicial review
by way of an order of certiorari
brought under Article 132 of the
1992 Constitution and Rule 61(1)
of the Supreme Court Rules C.I.
16 as amended by C.I. 24. The
applicant seeks the following
reliefs from this court:
i.
An
order of certiorari to bring up
into this Court for purposes of
being quashed the order of the
High Court (Financial Division)
Coram: Her Ladyship Justice Afia
Serwa Asare Botwe dated 24th
October 2013 confirming the
freezing of the Applicant’s
account and other assets within
the jurisdiction.
ii.
An
order of certiorari to bring up
into this Court for purposes of
being quashed the ruling of the
High Court (Financial Division)
Coram: Her Ladyship Justice Afia
Serwa Asare Botwe dated 7th
March 2014 dismissing the
preliminary legal objection
raised against the admissibility
of an FBI report for
non-compliance of section 161 of
the Evidence Act.
The grounds
for the application are three,
namely:
a)
Her
Ladyship exceeded her
Jurisdiction when she confirmed
the freezing of the Applicant’s
account in an order dated 24th
October 2013 without giving the
Applicant hearing.
b)
Her
Ladyship exceeded her
jurisdiction when she ordered
the transfer of the Applicant’s
funds lodged with Ecobank into
the Exhibit account of the
Respondent with the Bank of
Ghana.
c)
That
Her Ladyship exceeded her
jurisdiction when she dismissed
the preliminary legal objection
raised against the admissibility
of an FBI report for
non-compliance of section 161 of
the Evidence Act.
Facts of the
case
The Applicant
operates an account with Ecobank
(Ghana) Ltd, hereafter called
the Bank. In or around July 2013
an inward remittance of
US$10,000.00 was credited to the
Applicant’s account domiciled at
the Kotobaabi branch of the
Bank. The Applicant was duly
notified of the remittance by
the Bank via a text message. The
Applicant could not access the
money because his account was
frozen by the Chief Executive
Officer (CEO) of Financial
Intelligence, interested party
herein. The High Court confirmed
the freezing of the account by
an order dated 24th
October 2013 upon an application
ex parte by the CEO brought
under section 47 of the
Anti-Money Laundering Act, 2008
(Act 749), hereafter called the
Act. The Applicant made an
application to the High Court to
set aside the order and defreeze
the account. In response to the
said application the CEO
produced what appeared to be a
report emanating from the United
States Federal Bureau of
Investigations (FBI) and
purporting to implicate the
Applicant in some fraudulent
deal resulting in the transfer
to his account, the
subject-matter of this action.
The Applicant complains that he
was denied a hearing before the
High Court made the order of 24th
October 2013. He also complains
that the FBI report was accepted
by the court in utter disregard
of the provisions of section 161
of the Evidence Act. These
complaints have precipitated the
present application to this
court.
We begin with
a consideration of the second
relief set out above. It has
been said time without number
that an error of law within
jurisdiction must not be the
subject of judicial review, it
is a proper subject for appeal
unless it’s an error apparent on
the face of the record. Where a
judge acts within jurisdiction
but refuses to apply the
provisions of a statute to the
facts of the case before him/her
it is not in excess of
jurisdiction. Or where a judge
overrules a preliminary
objection as regards the
admissibility or otherwise of a
document the judge cannot be
said to have acted in excess of
jurisdiction. The editors of
Black’s
Law Dictionary 9th
Edition at page 645, define
‘excess of jurisdiction’ to
mean:
1.
‘when
the court has no power to deal
with the kind of matter at
issue;
2.
when
the court has no power to deal
with the particular person
concerned; or
3.
when
the judgment or order issued is
of a kind that the court has no
power to issue’.
The learned
editors also add that a court
will be acting in excess of
jurisdiction if it departs from
‘recognised and established
requirements of law, despite
apparent adherence to procedural
form, the effect of which is a
deprivation of one’s
constitutional right’.
To the above
may be added another principle
derived from the Australian case
of
TSIMPINOS V. ALLIANZ (AUST)
WORKERS’ COMPENSATION (SA) Pty.
Ltd. (2004) 88 SASR 311; (2004)
233 LSJS 300 that there is
excess of jurisdiction where the
court does an act, the doing of
which is within its power but
then it performs the act in
breach of the conditions which
authorize the doing of acts of
that class or nature.
Applying the
foregoing principles to this
case, the Applicant’s contention
is that the trial Court should
have discountenanced the FBI
report since it did not satisfy
the provisions of section 161 of
the Evidence Decree. Assuming
for the sake of argument that
the Applicant’s position is
correct, does that mean
the trial
judge exceeded her jurisdiction
as claimed by the Applicant?
Certainly not. The trial Judge
might have erred by admitting
the report but surely it was not
an act in excess of
jurisdiction. The second relief
sought cannot therefore be
granted.
The first
relief is founded on two
grounds, namely i. a breach of
the rules of natural justice, in
the sense that the Applicant was
not heard before the order was
made against him and ii that the
trial court Judge exceeded her
jurisdiction by ordering a
transfer of the Applicant’s
account with the Bank to be
lodged in the exhibits account
of the Respondent with the Bank
of Ghana.
To address
these issues it is pertinent to
refer to the relevant provisions
of the Act under which the
application was made and which
empowered the court below to
act. Section 47 of the Act which
has the heading ‘Freezing of
transactions or accounts’ reads:
1)
The
Centre shall not investigate
serious offences but where the
Chief Executive Officer is of
the opinion that it is necessary
to freeze a transaction or an
account to prevent money
laundering, the Chief Executive
Officer may direct the freezing
of a transaction or account of
any accountable institution.
2)
The
Chief Executive Officer shall
apply to a court within seven
days after freezing a
transaction or account for
confirmation of the action taken
and the court may confirm the
freezing on conditions or direct
the de-freezing of the
transaction or account.
3)
Where
a transaction or account has
been frozen, the person affected
shall be notified by the Chief
Executive Officer within
forty-eight hours of the
freezing of the transaction or
account and the person affected
may seek redress from court.
A close
reading of the above provisions
will indicate that the freezing
order could be obtained before
the person affected was
notified. It implies that it
could be obtained ex parte. The
Chief Executive Officer (CEO)
could apply to the court for
confirmatory order the very day
he freezes a transaction or
account. Thereafter he has
forty-eight hours within which
to notify the person affected by
the freezing order. He is not
required to notify a person
before he goes to court for
confirmation. He only commits a
violation if he fails to notify
a person affected within
forty-eight hours of his
decision to freeze the
transaction or account or of the
court’s order of confirmation
whichever is earlier in time.
Thus the trial court will have
to satisfy itself that as at the
date the CEO filed the
application for confirmation it
was less than forty-eight hours
from the time the transaction or
account was frozen by the CEO.
If forty-eight hours had lapsed
then the court should direct
that the application be made on
notice to the person affected.
In this case
the Applicant complains that the
CEO did not notify him even
after the confirmation order.
The process of notification to
an affected person is purely
administrative duty imposed by
law on the CEO and not on the
court. Thus the complaint has no
relevance to this application;
indeed it is otiose and will be
discarded as such. The
Applicant’s remedy lies
elsewhere.
As pointed
out above, the application could
be made ex parte before the
expiry of forty-eight hours from
the time the directive to freeze
a transaction or account became
effective. In this case the
record does not indicate exactly
when the directive to the Bank
to freeze the account was served
on the Bank and exactly when the
application to the court below
was made. The record only shows
the date the court below made
the confirmatory order. We would
be justified in concluding that
time lines were duly observed
following the maxim ‘omnia
praesumuntur rite esseacta.’
Thus lack of notice to the
Applicant was not fatal as it
was not required at the time the
application was made to the
court.
The Applicant
further complains that the court
below exceeded its jurisdiction
by ordering the transfer of the
Applicant’s account to the
exhibit account with the Bank of
Ghana. According to Counsel the
CEO lacks investigative power so
he cannot take into its custody
any exhibits so called. Moreover
section 47 of the Act requires
the court to do one of two
things, either it freezes a
transaction or it freezes an
account; it cannot do both. By
freezing the Applicant’s account
the court has deprived him of
access to his source of funds
even though the complaint
relates to a particular transfer
or transaction.
Section 47 of
the Act clearly distinguishes
between a transaction and an
account. Going by the definition
of ‘transaction’ contained in
section 51 of the Act, it
appears very broad in nature and
content. It defines it to
include ‘an act which
establishes a right or
obligation or gives rise to a
contractual or legal
relationship between the parties
to the contract or legal
relationship and any movement of
funds by any means with a
covered institution’
Section 51
also defines account to mean ‘a
facility or an arrangement by
which a financial institution
does any one or more of the
following;
a)
Accepts deposits of currency,
b)
Allows
withdrawals of currency or
transfers into or out of the
account,
c)
Pays
cheques or payment orders drawn
on a financial institution or
cash dealer by, or collects
cheques or payment orders on
behalf of, a person.
d)
Supplies a facility or an
arrangement for a safe deposit
box.’
The
dis-jointive word ‘or’ placed
between transaction and account
all through the subsections of
section 47 of the Act should be
appreciated by the court as it
is central to this
interpretation. The CEO must
satisfy the court whether it is
the entire account of a person
that he has put a freeze on or a
particular or specific
transaction in relation to the
account that he seeks to freeze.
It is important to observe this
distinction lest a court’s order
should result in unintended and
undesirable consequences. In
this case the record shows
clearly that it is the transfer
of the $10,000 into the
Applicant’s account which was
reported as a suspicious
transaction. There was no
complaint that besides this
transfer the Applicant had
carried out other suspicious
transactions in the operation of
his account. Thus
the
freezing order should have been
restricted to this particular
transaction only.
It is clear
the trial court exceeded her
power, authority or discretion,
as the case may be, under the
Act when she ordered the entire
account of the Applicant to be
frozen instead of limiting
herself to the $10, 000
deposited in the account in
suspicious circumstances,
according to the CEO. In other
words the complaint related to a
transaction in the account and
not the entire account operated
by the Applicant.
The final
limb of the argument is that the
court exceeded its jurisdiction
by ordering the money to be
lodged into an exhibit account
with the Bank of Ghana, instead
of either leaving it in the
Applicant’s account at the Bank
which had been frozen anyway or
with the court, thereby exposing
the money to the manipulations
of the CEO. Section 47(2) of the
Act enables the court to confirm
a freezing order upon
conditions. Such conditions
would include especially, secure
placement for the transaction or
account. It is entirely a matter
for the court’s discretionary
power to decide what reasonable
terms and/or conditions to
impose in granting the order. In
the instant case it is observed
that it was a freezing order to
enable investigations to be
carried out. The provision
imposes a duty on the court to
ensure that the transaction or
account which is the
subject-matter of the
investigation is well secured
and beyond the reach of the
suspect pending the
investigations. And if the court
believes keeping the account
with the exhibit account with
the Bank of Ghana would best
achieve the object so be it. The
CEO would not be able to
manipulate the account in any
way without a further order from
the court. The argument
therefore does not hold water.
Thus our
conclusion is that the order
should have been limited to the
$10,000 transaction and not the
entire account. To the extent
that the trial court froze the
entire account of the Applicant
it went beyond what was required
of her and thus exceeded her
power or authority or
discretion. Thus we would vary
the order to read: that $10,000
lodged into Applicant’s account
numbered 043301442815801
domiciled at Kotobaabi branch of
Ecobank Ghana Ltd be frozen and
same lodged in the Respondent’s
exhibit account with Bank of
Ghana pending investigations
into the source of the funds.
Subject to the above variation
the application should be
dismissed.
(SGD)
A. A. BENIN
JUSTICE OF THE SUPREME
COURT
CONCURRING OPINION
ATUGUBA ,
JSC:-
I have had
the benefit of reading
beforehand the brilliant Ruling
of my able brother Benin J.S.C.
who has treated this matter with
admirable and intricate judicial
calculus.
However,
before receiving his draft
ruling I had formed a view of
this matter which I think it
would not be superfluous to
express. It is trite law that
access to court is a
constitutional fundamental human
right which must be jealously
guarded in the construction of
statutes. Section 47(1) and (3)
of the Anti –Money Laundering
Act, 2008 (Act 749) seek on the
one hand to satisfy the need for
expeditious action to stem money
laundering activities without,
on the other hand undue
impairment of the right of
access to the courts. Hence
section 47 (1) enables the Chief
Executive Officer suo motu
“to direct the freezing of a
transaction or account of any
accountable institution”. Having
thus secured the transaction or
account against Piratical
access, sub section (3) is
designed thereafter to preserve
the right of the party affected
by the freeze, to access to the
courts. A statute must always be
construed ut res magis valeat
quam pereat. That being so I
choose to think that the true
intendment of the legislature
cannot be to enable the Chief
Executive Officer, the
interested party herein, whether
sub the moratorium
temporis of 2 days under sub
section (3) or of 7 days under
sub section 2, to subvert the
right of the party affected by
the said freeze to access to the
courts. If the Interested Party
can go to court on the same day
of his freezing directive so
also can he, the same day,
notify the party affected by his
freezing order of his
application to court; but if he
cannot on that same day notify
the affected party of his resort
to court then in view of the
securement of the suspicious
money by reason of the freeze he
must observe the Roman adage,
festina lente and the
legal maxim cessante ratione
legis cessat lex ipsa, so as
not to subvert the affected
party’s right to access to court
which is sought to be
safeguarded after the said
freeze under s.47(1) by dint of
the provisions of s.47 (2) and
(3). Surely if the Interested
Party is required to reach the
affected party within 2 days
under sub section (3) then must
he the more reach him pursuant
to the 7 day period under sub
section 2 with his application
to court for confirmation of his
freezing order. I use the
expression “pursuant” in
relation to sub section 2
because the Interested Party
could file his application on
the 7th day and its
reaching the affected party
depends on the service of the
same on him.
However,
subject to the variation made by
Benin J.S.C. thereto, I concur
in the dismissal of the
application in respect of the
order dated 24/10/2013 on the
ground of extreme delay in
applying for the discretionary
remedy of certiorari. The
applicant brought this
application on 19/5/2014 in
respect of an order dated
24/10/2013 aforesaid. Even if
the applicant had no actual
notice of the order he had
constructive notice thereof.
As regards
the order dated 7/3/2014 I agree
with my brother Benin J.S.C.
that there has been no excess of
jurisdiction. Even if one were
to consider error of law on the
face of the record no such error
is revealed on the face of the
terse Ruling of Afia Serwa Asare
J. I agree therefore that
certiorari cannot lie against
this latter order.
(SGD)
W. A. ATUGUBA
JUSTICE OF THE SUPREME COURT
SGD)
P. BAFFOE BONNIE
JUSTICE OF THE SUPREME
COURT
(SGD)
V. AKOTO BAMFO (MRS)
JUSTICE OF THE SUPREME COURT
(SGD)
J . B. AKAMBA
JUSTICE OF THE SUPREME
COURT
COUNSEL
HON.
ALEXANDER KWAMENA AFENYO
MARKIN ESQ. WITH HIM MISS
BERNINA KORKOR OKUTU FOR THE
APPLICANT.
ARTHUR
CHAMBERS FOR THE INTERESTED
PARTY.
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