KUMASI - A.D 2016
AMOAKO BLANKSON - (Plaintiff/ Appellant)
NANA BONSU - (Defendant/ Respondent)

DATE:  10TH MAY, 2016
SUIT NO:  H1/8/2016



The Plaintiff/Appellant is one of several artisans and tradesmen who were plying their trade on the fringes of the St Joseph Roman Catholic Junior Secondary School compound in Suame, Kumasi, a place well known for industrial activity. With time, the Kumasi Metropolitan Assembly and the Parents Teacher Association of the school complained about the effect of commercial activity on the safety and security of the children.


According to the Appellant’s case, the tradesmen formed a ‘loose union’ with himself as chairman and the first Defendant/Respondent as secretary. They petitioned the Assembly and the school not to be removed from the grounds of the school. In 1998, they entered into an agreement with the school which allowed them to build permanent trading places around the school. They were first to build a wall around the school. Each tradesman was allocated the space behind the part of the wall where they plied their business in a makeshift manner before the decision to build the wall. It was agreed that each tradesman would build his permanent shop on this space behind the wall. In his pleadings and evidence, the Appellant urged that the space allocated to him which was where he had plied his trade previously was numbered as Store No. 11. By the end of the trial, it was identified as Store No. 12.


It was the case of the Appellant that in order to ensure uniformity of the store structures, the 1st Respondent was engaged by the Association/Union to construct the shops for everyone. Each of the tradesmen was required to pay the 1st Respondent Gh¢900 as consideration for the construction of their particular shop. It was also the uncontested case of the Appellant, supported by exhibits, that between January 1999 and December 1999, the Appellant had paid Gh¢400 leaving a balance of Gh¢500 to be paid for the construction of the store. According to the Appellant, when he tried to tender the remaining Gh¢500 to the 1st Respondent in December 1999, the 1st Respondent refused to accept same. His position was that he had reallocated the shop to another tradesman on account of the Appellant’s failure to complete the payment early.


The Appellant registered his protest to this position in several ways and after various altercations that run through police stations and courts, the Appellant commenced this suit. In his last amended Writ of Summons, the Appellant claimed for

a. A declaration that he being the original allotttee of the land marked out as store No 12, located on the grounds of the St Joseph RC JSS Suame, and which plot was meant for the construction of stores, the Defendant had no right to arbitrarily wrongly allocate the said store to another person, so as to deprive the Plaintiff its use.

b. Recovery of possession of the said space or plot or any store built on the said plot No 12.

c. Damages for trespass.

d. Perpetual injunction.


In his Statement of Defence the 1st Respondent denied that the authorities of the school allocated space on portions of the school grounds for the Plaintiff and other persons to build permanent structures thereon. He contended that the site was lawfully leased by the Government of Ghana to a limited liability company called Gabbat Company Ltd. While denying the assertions regarding the Appellant and others having been allocated space on the school grounds to construct permanent structures, he admitted an agreement for the payment of Gh¢900 for the construction of the stores and said that Gh¢900 was the initial rent advance to Gabbat Co Ltd. He also admitted that the


Appellant had paid 400 GHC and said that was for ‘defrayment of cost of construction of the store’.


It was his case that after failing for almost one year to get the Appellant to pay the balance of 500 GHC, Gabbat Company had to fall on other prospective tenants to complete the stores. The company therefore offered the Appellant an alternative store which Appellant refused. He described the Appellant’s acts of protests against the ‘re-allocation’ of the store he was laying claim to as ‘unlawful’ and averred that the Appellant ‘has no title to or interest in the site on which stands the store complex as the same invested (sic) in Gabbat Company Limited according to law’


In June 2000, the Appellant applied for an injunction restraining the 1st Respondent and all claiming through him from ‘further dealings with the Store No 11’ that he was laying claim to in this suit. It was not till June 2008, eight years into this case that the court granted an injunction against the 1st Respondent from ‘removing the container on Plot No 12 at Suame/Kumasi and allocating the said plot to another person pending the final determination of the suit’.


It would seem that this precipitated the involvement of the 3rd Respondent in this case. He applied to vacate this order in July 2008, on the strength of averments that on 21st January 1999 and 3rd March 1999 respectively, he paid Gh¢1000 in two equal installments for the store that the Appellant was claiming. He had paid this money to the 1st Respondent who he described as ‘the representative of Gambat, an association of spare-parts sellers’.


The 1st Respondent added his voice to this application and urged that the store is the property of Gabbat Company Ltd and this company had entered into a Tenancy Agreement with the 3rd Respondent over the store. The tenancy agreement over Shop No 12 is found on page 62 of the Record of appeal and is dated 16th March 2002, It was executed between Gabbat Company Ltd acting by the 1st Respondent as one of its directors for a period of 50 years.


On the strength of this application, the court varied the injunction order and ordered the reopening of the store whilst the case took its normal course subject to the 1st Respondent undertaking to compensate the Appellant in the event of the Appellant winning the case. Soon after these orders, the 2nd and 3rd Respondents were joined to this case as Defendants.


Several pieces of fact were established before the court through the uncontested evidence tendered. It is important to set them out for the purpose of clarifying the chronology of the various activities that led to this suit. Exhibits A series showed that the Appellant commenced payment for the construction of the stores from 13th January 1999 to 1st December 1999. Payments were made to the 1st Respondent, who received the first two payments on an unheaded receipt captioned ‘Invoice’. The third receipt was issued in December 1999 under the name ‘Nana Bonsu Ventures’. These records show that the Appellant did not at any time pay Gabbat Co Ltd to construct a shop for him or as landlord of the stores.


Exhibits 2 and 3 established that Gabbat Company Ltd was incorporated on 11th May 1999 and obtained a lease of 0.35 acres of land on a site described as ‘Site for Shop in the Tarkwa Markro Layout in Kumasi on 28th September 1999. Thus by the time Gabbat Company Ltd obtained its lease, the stores had been under construction for at least nine months..


Exhibit B established that a criminal complaint had been made against one George Baffuor Owusu Afriyie, Assembly man, the 1st Respondent, one Akwasi Amanful and one Takyi Brefo Rexford that in May 1999, they had agreed together to commit the crime of defrauding by false pretence contrary to Section 131 of Act 29, 1960. The particulars of the charge was that they had obtained the consent of the artisans and spare part dealers numbering about 52 at Maakro Suame to part with an amount of Cedis 464,500,000 (now 46, 450 Ghana Cedis) under the pretext of building uniformed market stores for them. They had however registered the stores in the name of Gabbat Company in their names instead of the group, a representation which they well knew at the time of making same was false. Exhibit B further showed that this criminal suit had been settled and adopted by the court as a consent judgment. The judgment was that Gabbat which holds the lease on the property in the case would “be set aside, and a new company formed to take over the ownership of all ASSETS AND LIABILITIES of the Anomanye Nkwanta Stores Building Project, which is in the custody of Gabbat. Further, the new company will be formed by all the complainants and the documents on the building will be legally transferred to the new company.”


The nine parties to the settlement included the Appellant as the 8th person, the four accused persons as the 1st, 4th, 5th, 7th parties. The other parties were Kwadwo Tuffuor as the 2nd, Kwabena Num as the 6th, and Akwasi Marfo as the 9th parties.


At the end of the suit, the trial court dismissed the Appellant’s case. Tracing the chronology of events, he disagreed with the 1st Respondent that the Appellant’s payments and the other payments of his colleague traders were done as rent advance to Gabbat Co, because ‘the company did not exist before the idea to construct the complex came up’.(page 3 of the judgment and 203 of the ROA)


He however found that ‘the truth of the matter is that at the time Plaintiff made his last payment on 1st December 1999, Gabbat had acquired the land for the complex for which a lease was engrossed in its favour’. Citing the company law principle of the separate identity of corporate bodies and Soonboon Seo v Gateway Worship Center 2009 SCGLR 278 and Salomon v Salomon1897 AC 22 , he concluded that Gabbat company was an entity separate from its founders, that it had acquired a lease on the land on which the complex of shops stood while the shops were being built and became the landlord of the shops, that the Asomdwee House Company had been incorporated to take over the assets and liabilities of Gabbat and it was therefore now the landlord over the stores. He concluded that the ‘the claim by the Plaintiff that the headteacher of the school allocated a piece of land to him cannot no longer be the case, as the whole parcel of land housing the complex belongs to the incorporated company’


After noting that the Appellant was part of the settlement of the circuit court criminal trial which agreed that a new company would take over the assets of Gabbat Company Ltd, which settlement occurred at a time that Appellant had commenced this suit and knew that Gabbat had leased the shop he was claiming to the 3rd Respondent, the honourable court found fault with the Appellant’s failure to raise his ‘alleged right to the disputed store for consideration (so that ) a decision could be taken as part of the settlement’.


He said the Appellant did not seize that moment to press home whatever right he alleged over the disputed store and slept on his right whilst a company was promoted with his active participation. He therefore concluded that ‘it is too late in the day, whatever may be the motive of those who initiated the building of the store Complex, for the third Defendant to be ejected from the property in favour of the Plaintiff, who as at now, has not fully paid his contribution towards the erection of the project’


The trial court decided to believe the 1st Respondent on the question of whether or not the Appellant attempted to pay the GH¢500 which was refused by the 1st Respondent. In his evaluation, if the Appellant genuinely attempted to pay off his contribution and an impediment was placed on his way by the 1st Respondent, he would have raised it when the chance became available to him at the settlement of the criminal matter of which he was a participant.


He found no favour with the position of the Appellant that no time limit was set for the payment of the contributions by those who committed themselves to build the complex. He described that contention as ridiculous because the main source of funding the project was the contributions of individual members. He said that in failing to pay up in good time and delaying the project for the collective benefit of all the contributors, the Appellant ‘cared very little about the success of the project…he played a trick on his colleagues so he waited to benefit from their sacrifices, …the court had seen through his malicious intention …and he deserves an appropriate reward for his mischief’


After considering the evidence of PW2 which corroborated the Appellant’s position that it was agreed by the artisans from the beginning of the project that after construction, every contributor would occupy the store directly behind the wall where their temporary structure was, the court said that if this testimony ‘was intended to buttress the case of the Plaintiff that there was an agreement for contributors to occupy stores behind the school wall corresponding to spaces they originally occupied, that could only be applicable to those who fully discharged their financial obligations towards the building of the complex’.(page 208).


Citing principles of equity, the judge said that the Appellant ‘did not invoke the jurisdiction of the court with clean hands and as it is an established fact that every court in Ghana is a court of both common law and equity, this court is entitled to apply equitable principles in determining the issues in the suit he mounted’. He once again pointed to the dictum in the Soonboon Seo case.


It was his evaluation pursuant to this assessment of equity that, were he to grant the relief that the Appellant were entitled to the shop 12 which was occupied by the 3rd Respondent,’… it would result in grave injustice to the occupier of the property who had paid valuable consideration to the owner, Asomdwee House Company and has been in possession since 1999 or thereabout’ He dismissed the suit in its entirety.


The Appellant has appealed on the following grounds:

a. That the judgment is against the weight of evidence

b. That the trial judge erred by dismissing the Plaintiff’s claim on the grounds that he had not fully paid his contribution


Although the Appellant indicated that additional grounds of appeal would be filed, they were not.


Rule 8 (1) of the Court of Appeal Rules 1997 CI 19, provide as follows:


8. Notice of Appeal

(1) Any appeal to the Court shall be by way of re-hearing and shall be brought by a notice referred to in these Rules as ‘the notice of appeal’.


A rehearing of the entire suit to determine whether the trial court wrongly evaluated the evidence before him is also the duty of a court when an Appellant urges that a judgment is against the weight of evidence. The established principle, from cases such as Tuakwa v Bosom, 2001- 2002 SC GLR 61, is that it is the duty of the appellate court to analyse the entire record of appeal before arriving at its own decision on whether the trial court was right in its decision.


On a rehearing of this suit, I find that the honourable trial judge misled himself on account of his failure to properly consider the nature of legal relations that was created between the KMA, the school, the Appellant and 1st Respondent, Gabbat Co. Ltd. and finally the 3rd Respondent commencing late 1998 into January 1999 and how these legal relations impacted the claims and defences in the action. These legal relations were governed by the laws of property, contract and equity, but especially, the law of equity.


Whenever multiple parties become involved in any transaction at different times, creating a criss-cross of legal rights and obligations, the duty of a court and lawyers representing them is to trace in clear lines the actual interests, obligations and rights each party held from the beginning of their legal relations up to the culmination of the matters in dispute. It is only in clarifying those interests and obligations and rights at every point in time, and determining the proper principles of law to apply to those interests, obligations and rights at every point in the labyrinth, and especially from the beginning, that a court can justly and ‘rightly divide the truth’ of their rights.


In the present case, both the Appellant and the 1st Respondent started life on the land in issue as licensees of the school which stood on the land in issue, and the Kumasi Metropolitan Assembly which owned the land.


Section 139 of the Land Title Registration Act, 1986 (PNDCL 152) defines a license as


‘’license’ means a permission given by a proprietor of land or of an interest in land which allows the licensee to do certain acts in relation to the land which would otherwise be a trespass, but does not include easement or profit’


The evidence of all the parties and their witnesses established this clear situation of fact which must be interpreted within this legal context.


This was the testimony of the Appellant found on page 81 of the ROA.


‘About 20 years ago, I pleaded with the teachers of St Joseph School for a place to trade. They showed a plot on which store room No 12 is located. I placed a container on it and sold spare parts in it’.


This testimony was not contradicted but corroborated by all who testified, including PW1, PW2 and the 1st Respondent who also testified on behalf of the 2nd Respondent. PW1 said on page 98.


‘Yes I do (know the Plaintiff). I also know the 1st Defendant. I also know representative of 2nd Defendant…At St Joseph R/C JSS the 1st Defendant and representative of 2nd Defendant were already on the school land with the exception of the Plaintiff. I was there before he came to ask for a piece of land to have his trading transactions on it. After consulting the PTA the piece of land was given to the Plaintiff for free…When I went to school I made all those on the land to write an undertaking acknowledging that the land is for the school and at any time, the school needed the land it would be taken from them’.


PW2 said on page 104 of the ROA:


‘I have been there between 22 and 25 years. Initially, we traded in kiosks. We were many. I cannot mention all. The Plaintiff, the 1st Defendant, representative of 2nd Defendant were part.’


1st Respondent confirmed this state of affairs in his evidence in chief and found on page 113.


‘I have lived at the site of the stores since 1982. Whilst there other artisans joined me, and we did our businesses. We were all squatters’.


As licensees, the interests of all the artisans were limited to the leave given them by these two institutions. Until 1998, the license held by the Appellant and the 1st Respondent, along with their colleague tradesmen was a license to trade on the land and nothing more.


But starting from late 1998, the evidence before the court is that this legal context changed. According to all the witnesses quoted above, both the school and the KMA gave the artisans leave to change their trading in makeshift structures and construct permanent stores on the land for their trading therein.


The testimony of the Appellant on page 82 was


‘KMA officials asked us to vacate for them to construct a wall to protect the school compound. We went and pleaded and they agreed that we should construct the fence wall. In December 1998, we were given the green light to construct our various store rooms…(the store rooms were) outside the school compound. (emphasis mine)


q. did you have any arrangement as to how to construct the wall and your stores


a. yes we had


q. what was it


a. everybody was to construct his store room. Later 1st Defendant suggested that for uniformity we should come together and do so…we gave permission to 1st Defendant to collect the various monies from us, and construct the stores and hand over each one’s store. …we agreed that each one of us will occupy directly behind the wall where he was’


PW2’s corroboration of this change on page 104 was this:


‘Government decided to build a fence wall around the school. We were trading in front of the school. So we elected Plaintiff, 1st Defendant and others to construct a wall around the school, and construct a bungalow for the school, then we started to build a store complex.’


1st Respondent‘s version of how the permanent structures were constructed can also be found on page 113:


 ‘At a time officials from KMA came and wrote on our kiosks to remove them. Anytime the officials did that, we petitioned KMA… Initially we had an association. KMA threatened to eject us…I later invited the 7 others and suggested that we construct a store complex. We later invited those selling on the main road to join us so we were now 45 in all. Plaintiff was included. Each member was told to pay 9 million old cedis. We were to use that money to construct the stores, and we gave ourselves time to pay up… Some were able to pay’.


With this construction of permanent stores on the land with the collective income of the artisans and tradesmen, the tradesmen could point at an asset of theirs which was affixed to the Assembly’s land, and which would give them the right to go on to the land, beyond the exercise of a license. The construction of the wall also introduced the element of consideration through expenditure, into the relationship between these tradesmen and self-described ‘squatters’, and the person with authority over the land which is undisputedly Government of Ghana acting through the Kumasi Metropolitan Assembly.


This element of expenditure changed the legal context of their relationship, as consideration always does. The law of real property recognizes this shift from a bare license where a bare licensee operates on land at the sufferance of the licensor and when other elements enter the relationship which must compel a proprietary interest.


This is found in the end of the definition of license in Section 139 of the Land Title Registration Act, 1986 (PNDCL 152) which I will quote again:


‘’license’ means a permission given by a proprietor of land or of an interest in land which allows the licensee to do certain acts in relation to the land which would otherwise be a trespass, but does not include easement or profit’ (emphasis mine)


It is a well-recognized element of the law of real property that an easement or profit a prendre will always give a licensee a proprietary interest which must be protected in law.


BJ Da Rocha and C H Lodoh describe ‘profit’ in these words on page 95 of their book Ghana Land Law And Conveyancing, Anansesem Publications 1995


‘Nature: A profit a prendre is a right to enter another person’s land and take something capable of ownership off that land, and it is this right to take part in the produce of the soil or in the soil itself that principally distinguishes a profit from an easement. A right is a profit only if the thing to be taken is something that is capable of ownership’


This description is almost verbatim with the description of profit a prendre on page 569 on Cheshire and Burn’s Modern Law of Real Property, 16th Edition, Butterworths, 2000


My evaluation of the legal context of the transactions from 1998 is that, when a strong Assembly, capable of demolishing unapproved buildings, listens to the petitions of hapless small time artisans and traders led by their leaders, and allows them to gather resources to create a permanent store complex on the Assembly’s land, that asset placed there moves the artisans from mere licensees working on the leave and let of the school and assembly, and gives them a right of profit in the shop complex. It would be unconscionable to fail to recognize the proprietary interest of the tradesmen who funded the building of the permanent stores in their stores.


The law of equity which concerns itself with preventing fraud and un-conscionability is very much an essential part of Ghana’s law. Thus this right of profit is not protected only in common law, but also by statute in Ghana.


Though the Conveyancing Act 1973 NRCD 175 is strident about writing as an essential element for gaining proprietary interests in land, Section 3 protects this common law right of profit which resides in persons who have assets on another person’s land, or are entitled to take profitable goods affixed to that land – even where there is no writing. The need to protect such interests, which are not stricto sensu legal conveyances, is catered for. It provides.


Section 3 – Transactions Permitted without Writing

1. Sections 1 and 2 shall not apply to any transfer or contract for the transfer of an interest in land which takes effect –

a. by operation of law

b. by operation of the rules of equity relating to the creation or operation of resulting, implied or constructive trusts

c. by order of the court;

d. by will or upon intestacy

e. by prescription

f. by a lease taking effect in possession for a term not exceeding three years, whether or not the lessee is given power to extend the term

g. by a license or profit other than a concession required to be in writing by section 3 of the Concessions Ordinance (Cap 136)

h. by oral grant under customary law (emphasis mine)


2. Sections 1 and 2 shall be subject to the rules of equity including the rules relating to unconscionability, fraud, duress and part-performance


The need to protect such interests created outside of writing is recognized by legal scholars, including our own Sir Dennis Adjei in his book Land Law, Practice and Conveyancing In Ghana, Adwinsa Publications, 2015. He says on page 64 that


‘Section 3(2) of the Conveyancing Act is an important provision because it is aimed at reducing or avoiding fraud, duress and unconscionability in land transactions’.


It is my firm evaluation that the license under which the artisans operated was graduated to become a profit by reason of the construction of the shops. Since a profit a prendre confers a possessory right on its owner, the trial court should have first recognized this interest before recognizing the lease created in favour of Gabbat Co months after the construction of the shops had started.


Indeed, the law of equity will go further to pronounce a resulting trust over the store complex in KMA for these artisans. ‘A resulting trust will always be implied where one person is induced by agreement to expend money on the property of another without intending a loan or a gift. If a person spends his own money on building or improvements on the land of another, with the latter’s knowledge and consent, a resulting trust arises in his favour unless it can be shown that the expenditure was by way of a gift or a loan. In such a case, it is considered inequitable that the legal owner of the property takes the property for himself and disregards the interest of the person who has been induced to spend money. The equitable interest of the person who spends the money will be proportionate to the amount of money spent in relation to the value of the property ‘– da Rocha and Lodoh, cited supra at pages 59, 60.


Thus, the learned judge should have recognized that prior to the lease given by KMA to Gabbat in September, 1999, KMA had given an interest in their minute portions of land to all the artisans who were authorized to construct permanent shops on the land. At that time, KMA held title in those shops in a resulting trust for the tradesmen who contributed to their construction. He should also have recognized that the lease issued in September 1999 did not make Gabbat the landlord of the artisans, because Gabbat was not the one who funded or built the shops. It would seem that the learned trial judge was lulled into accepting Gabbat Co as the land lord over the store complex simply because it obtained a lease on the land months after construction begun. This reasoning is against the weight of the evidence, especially when the court in another breath refused to accept the 1st Respondent’s testimony that the 900Ghc was to be paid to Gabbat Co as ‘rent advance’ because he was clear that when construction of the shops commenced, there existed no Gabbat Co.


In Asante Appiah v Amponsah alias Mansah 2009 SCGLR 90, the Supreme Court held that the Plaintiff’s case which was based on an oral grant or sale could not avail him on account of the provision of Section 2 of the Conveyancing Act 1973 NRCD 175, unless exempted from the need from writing under the exceptions in section 3 of the Act. In this case therefore, the Appellant’s proprietary interest in Store 12 obtained by the permission to the tradesmen to build a permanent store on the land is protectable and enforceable, by reason of Section 3(b) and (g) of the Conveyancing Act NRCD 175.


How does this affect the lease obtained by Gabbat Co in September 1999? It is trite learning that a purchaser who buys a property buys it subject to all encumbrances that they find on the land and which they could have discovered if they were a prudent purchaser.


In this case, even if the 2nd Respondent, Gabbat Company, obtained a lease on the land in issue in September 1999, they would have found this uncompleted store complex on the land by that date, because from the testimony of all the parties, the construction started in late 1998. Thus I have no hesitation in holding that even if Gabbat Company obtained a lease on the land in question, that lease would be subject to the right to profit that the artisans had in their store complex which was being constructed at the time the lease was entered into.


And this right to profit creates a proprietary estoppel against anyone who interferes with the rights of the Appellant and the other tradesmen who contributed to the building of the complex from going to their stores and enjoying the profit of their stores. It entitles the Appellant to his claims before the High Court.


This brings me to another issue of law which the court seemed to accept without close examination. This is the issue of whether Gabbat Co could reassign the Appellant’s store to the 3rd Respondent in the tenancy agreement dated 2002 when the Appellant failed to complete paying for the construction of his store before Gabbat Co obtained the lease on the land. Again, my humble view is that this thinking is not in any way borne out by the evidence or supported by law. The mere fact that you have a lease on land cannot make you the land lord of properties built thereon if the properties were constructed by parties other than you. This is the essence of being subject to ‘prior encumbrances’.


Neither could the 1st Respondent exercise proprietary landlord rights over the store complex when the Appellant failed to complete paying for the construction of his store before Gabbat Co took a lease on the land because the 1st Respondent had no proprietary interest over the stores.


The clear uncontested testimony of all witnesses, including the 1st Respondent but excluding PW1is that the store complex was constructed with pooled funds from the various artisans. So clear was this evidence that the trial judge had no hesitation in dismissing the 1st Respondent’s position that the payment of the GH¢900 contributions was rent advance to the 2nd Respondent Gabbat Company.


Payments were made to 1st Respondent to construct the shops for the 45 people who he said started out with a commitment to build the store complex. From January 1999 therefore, the legal relation between the Appellant and 1st Respondent (as well as the other contributors) was simply a contract for service. It was a contract for 1st Respondent to manage the resources given to him and construct the stores and nothing beyond that.


As one providing a service, when the Appellant failed to pay for the shops on time, the right of the 1st Respondent was a right to the balance, including the right to sue for his money, and not a right to appropriate or re-allocate the shop. The duty given the 1st Respondent to construct the shop with the pooled funds did not transform him into a landlord with authority to appropriate the shop when the Appellant failed to pay on time. Neither could he step in as director of Gabbat Company, to appropriate the shop in the name of Gabbat Co Ltd as he seemed to have done in 2002, when Appellant failed to complete payment for the construction of his shop on time.


Indeed, the only other legal context within which I can think of the 1st Respondent regarding the moneys given to him to construct the shop is that of a trustee of those funds. And this concept of the ownership of the stores being in the body of tradesmen seemed to have been strongly in the mind of the Judge as he kept referring to a duty that the Appellant had to pay his money on time, and negotiate with his colleagues. And yet the honourable Judge swiveled easily into accepting that Gabbat was entitled to take over the stores and assert ownership. While pronouncing on the separation of identity between Gabbat as a legal entity and its members, he also did not seem to find anything wrong with how moneys given to the 1st Respondent to construct a store complex ended with proprietary interest in the land moving to the 2nd Respondent which was owned by the 1st Respondent and the Assembly man for the area.


In their discussions on legal and equitable ownership, the learned authors da Rocha and Lodoh state on page 56 ‘a constructive trust arises by operation of equity where a fiduciary relationship exists. A trustee or a person in a fiduciary relationship is not permitted to profit from his position. If therefore such a person obtains any valuable interest in the property he is holding on trust, equity decrees that he holds it on a constructive trust for the beneficiaries. Another example of a constructive trust arises when a person acquires trust property in breach of trust with knowledge of the breach. In such a case the purchaser holds on a constructive trust for the beneficiary.’


Thus whereas KMA held a resulting trust over the store complex in favour of the tradesmen who funded its building, the 1st Respondent held a constructive trust over the money used to fund the building. It is with this background that I find it a matter of significant legal import that these tradesmen were able to assert rights against Gabbat Co in the circuit court through the criminal complaint. It is also of significant legal import that in the terms of settlement reached in that criminal case, it was agreed that the new company would be ‘formed by the parties here in this case’.


Clearly, these terms of settlement reflected the original unwritten right of profit given to the artisans by KMA and which the lease issued in the name of Gabbat sought to over reach. Thus far from the Appellant failing to ensure that the interests he was asserting in this suit were covered by the terms of settlement in the criminal suit, the Appellant, who was a party to that consent judgment ensured that the 1st Respondent and his cohorts committed themselves to the transfer of the assets of Gabbat to the new Company which was supposed to have as its members, the parties herein and other persons.


The learned trial Judge should have recognized the original unwritten right of profit that Appellant had in store number 12. He should have also recognized that at no time did Gabbat have an interest in the shops – not having been the builder or funder of the project. Its lease interest was in the land the shops stood on and could mature to include the shops only after the shops owners had exhausted their investment. But most importantly he should have recognized that the consent judgment had ended Gabbat’s entitlement to the lease and established the legal frame work for a new lease to the appellant and his collegues through the new Company.


Again, it is important to note as a matter of equity that at the time the 3rd Respondent purported to take a tenancy from Gabbat in 2002, this action was pending and an application for injunction had been pending to restrain the 1st Respondent from dealing with the store in dispute.


Thus in 2002 when the 1st Respondent, purporting to act as director of Gabbat, signed a tenancy agreement over Store No 12 with the 3rd Respondent, there was actually an application for injunction to restrain him from doing what he did. This tenancy agreement was entered into with the full knowledge of the Appellant’s resort to court to protect his interest. It was therefore wrong for the learned trial judge to seek to protect the 3rd Respondent’s business in the store on grounds of equity. He who comes to equity must himself do equity. The purported lease of the 3rd Respondent given to him by Gabbat is set aside as having no foundation in property law and being in direct conflict with the law of equity. Gabbat had no right over the stores and the 1st Respondent was constrained by rules of administration of justice not to act as he did.


I find that the acceptance by the learned trial judge that by obtaining a lease on the land, Gabbat Company became the owner of the shops is wrong in law and against the weight of evidence. The holding of the learned trial judge that the Gh¢400 paid to the 1st Respondent was not rent advance to Gabbat as landlord was right. However, his holding that the 1st Respondent acting through Gabbat Company had the right to reallocate the shop when the Appellant failed to complete the payment for the construction within one year was wrong. The two grounds of appeal are upheld and the judgment is reversed. The following consequential orders are made:

a. A declaration is granted that the Appellant, being the original allotttee of the land marked out as store No 12, located on the grounds of the St. Joseph RC JSS Suame, and which plot was meant for the construction of stores, the 1st and 2nd Respondents had no right to arbitrarily and wrongly allocate the said store to the 3rd Respondent, so as to deprive the Appellant its use.

b. Damages for trespass in the sum of Gh¢25,000 against the 1st Respondent for failing to hand over the store to the Appellant when the store was completed.

c. The Appellant is to pay the outstanding Gh¢500 for the construction of shop to the 1st Respondent with interest at the prevailing rate from January 1999 to March 2000 when the Appellant commenced this suit, which sum is to be set off from the damages.

d. The Appellant is to recover possession of the said space or plot or any store built as store No 12 from all the Respondents or whoever obtained an interest in the stores.

e. Perpetual injunction against the Respondents from interfering with the Appellant’s use of his store number 12.


Cost of Ten Thousand Ghana Cedis (GH¢10,000.00) in favour of the Appellant against the 1st Respondent.







AYEBI                         I agree                                  E. K. AYEBI

                                                                      (JUSTICE OF APPEAL)



DOMAKYAAREH      I also agree               A. M. DOMAKYAAREH (MRS.)