IN THE SUPERIOR COURT OF JUDICATURE
IN THE COURT OF APPEAL
ACCRA - A.D 2019
AGVAD GHANA LTD - (Plaintiff/Respondent)
TRADING MEDICAL SYSTEMS PRIVATE - (Defendant/Appellant)
DATE: DATE: 4TH APRIL, 2019
SUIT NO: H1/232/2018
JUDGES: P. K. GYAESAYOR J.A (PRESIDING), AVRIL LOVELACE-JOHNSON J.A, NICHOLAS CHARLES AGBEVOR J.A
AHMED MUSAH FOR THE PLAINTIFF/RESPONDENT
BARBARA EWOENAM KUKAH FOR THE DEFENDANT/APPELLANT
AVRIL LOVELACE-JOHNSON (JA):
On 6th February 2018, the commercial division of the high court refused the appellant’s application to strike out the respondent’s statement of claim on the ground that it disclosed “no cause of action” against them.
It is this refusal that has caused the appellants to launch the present appeal on the following grounds
That the learned High Court Judge erred when he held that he could not grant the application unless he saw the evidence Plaintiff intended to rely on in the trial
That the learned High Court Judge erred when he held that he would not dwell so much on agency and its principles in determining the application.
They seek from this court a setting aside of the High Court’s ruling and an order striking out the statement of claim in question on the ground that it discloses no cause of action against them.
No additional grounds were filed.
Order 11 rule 18(1)(a) of CI 47 under which the application was brought states as follows
(1) The Court may at any stage of the proceedings order any pleading or anything in any pleading to be struck out on the grounds that
a) it disclose no reasonable cause of action or defence.
The pleading which the appellant seeks to have struck out is the plaintiff’s statement of claim which states as follows
1. Plaintiff is a company registered under the laws of Ghana and engages in the business of medical equipments.
2. Defendant is a company registered under the laws of Jordan and engages in the business of medical equipments
3. Plaintiff avers that it has had a mutually beneficial relationship with a third party entity called Belstar Development Ltd based in the US but with an office presence in Accra
4. Plaintiff further avers that in or around November 2011 Belstar Development Ltd was awarded a contract by the Ministry of Health of Ghana for the supply of various medical equipments for various hospitals in the Country including Korle bu Teaching Hospital, Accra
5. Under the contract, Belstar Development Limited sought a credit facility to pre-finance the purchase and supply of the medical equipments on behalf of Ministry of Health for onward distribution to selected hospitals across the country.
6. Plaintiff avers that owing to the mutually beneficial business relationship between it and Belstar Development Ltd, it introduced the latter to various suppliers of medical equipments which included Toshiba, Fuji Film, and Shimadzu Ltd for the purposes of procuring the medical equipments from those suppliers.
7. Plaintiff would contend that Belstar Development Ltd procured some of the medical equipments from the Defendants who are the accredited Africa and Middle East agents of Toshiba
8. Plaintiff avers that under the sales and purchase Agreement with the Ministry of Health, Belstar Development Ltd provided warranty for the equipments supplied to the selected hospitals across the country which included the Korle bu and the Komfo Anokye Teaching Hospitals.
9. Plaintiff avers that under the sales and Purchase Agreement between Belstar development and the Ministry of Health, the former was expected to provide a post-warranty maintenance for all the equipments supplied under the agreement
10. Owing to the mutually beneficial business relationship between Plaintiff and Belstar Development Limited, the latter requested Plaintiff to undertake the maintenance works of all the equipments supplied under the Sales and Purchase Agreement
11. Plaintiff would say that with the express consent of the Ministry of Health, Plaintiff entered into a Technical Services contract with Belstar Development Ltd for the maintenance of all the medical equipments supplied to the selected hospitals across the country
12. Plaintiff avers that it entered into a technical Services agreement dated 11th June 2015 with Belstar Development Ltd for the maintenance of the said equipments
13. The Technical Services contract which commenced on 1st September, 2015 was structured in such a way that the maintenance period for some of the equipments was for two (2) years whilst others had a Three (3) year duration
14. Plaintiff would contend that since 1st September 2015, it has carried out its duties under the Technical Services contract without let or hindrance
15. Plaintiff would further contend that on or about 27th September, 2017 representatives of the Defendant arrived in the country unannounced and without notice to Plaintiff commenced a maintenance service at the radiology department of the Korle bu Teaching hospital which is one of the beneficiary hospitals under the maintenance agreement
16. Plaintiff avers that Defendant is not privy to the Technical Services Agreement signed between Plaintiff and Belstar Development Ltd and has therefore usurped the rights of the Plaintiff under the agreement
17. Plaintiff further avers that apart from usurping its functions at the Korle bu Teaching Hospital, the Defendant is also visiting other medical hospitals where Plaintiff have been contracted to carry out maintenance works under the Technical services agreement with a view to taking over the maintenance works of medical equipments at those hospital
18. All attempts by Plaintiff to compel both the management of Korle bu and the Defendant to stop interfering in the work of the Plaintiff has proved futile as both management and Korle bu Teaching Hospital and the Defendant have ignored repeated complaints and warnings of the Plaintiff
19. The Plaintiff avers therefore that unless compelled by this Honourable Court, the Defendant has envinced an intention not to stop interfering with Plaintiff’s right under the Technical Services Agreement.
This statement of claim was filed with a writ for the following reliefs;
A declaration that the conduct of the Defendant amounts to an unlawful interference with the rights of the Plaintiff under the Technical Services Agreement
A declaration that the Defendant is not privy to the Technical Service Agreement
A declaration that the carrying out of maintenance works at Hospitals specified in the Technical Services Agreement by the Defendant is unlawful
An order directed at the defendant to desist forthwith from any further interference with the Plaintiff’s rights under the Technical Services Agreement
An order of perpetual injunction against Defendant, their servants, workmen, assigns, prives, agents, or whomsoever from carrying out any maintenance work at any of the hospitals indicated under the Technical Services Agreement
General Damages for unlawful interference
Costs including litigation expenses.
The issue to be resolved here is whether the Respondent’s statement of claim, on the face of it, without any further evidence, discloses a reasonable cause of action against the appellants. Its resolution will determine whether or not the two grounds of appeal have any merit and should be upheld.
A cause of action has been defined as
“simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person”
Per Lord Diplock in LETANG v COOPER  1 QB 232 C.A
From the statement of claim is there a factual situation that exists which entitles the respondent to a remedy from the appellants? The appellants think not, contrary to the position of the learned trial judge.
Sub rule (2) of order 11 rule 18 clearly states that in resolving the above issue, the court is limited to the pleading complained of. No other evidence is to be admitted and considered. There are also several authorities to this effect. See
OKOFO ESTATES LTD v MODERN SIGNS LTD & ANOR [1996-97] SCGLR 224 HARLLEY v EJURA FARMS GHANA LTD  2 GLR 179
GHANA MUSLIMS REPRESENTATIVE COUNCIL v SALIFU  2 GLR 246 APPIAH II v BOAKYE [1993-94] 1 GLR 417
The position of the courts from the above cases has always been that the jurisdiction to strike out pleadings must be used sparingly and only in plain, simple and obvious cases where there is no point in having a trial. As long as a case is susceptible to arguments on serious points of law or requires evidence to resolve issues raised, then no matter how weak a case appears to be it should not be struck out.
This is to ensure that a plaintiff is not driven from the judgment seat without the opportunity to be heard. In this regard it has been stated that
“A pleading would only be struck out where it was apparent that even if the facts were proved the plaintiff was not entitled to the reliefs sought”. Per Azu Crabbe (CJ) in
GHANA MUSLIMS REPRESENTATIVE COUNCIL v SALIFU supra. See also the recent case of
GBENARTEY & GLIE v NETAS PROPERTIES & INVESTMENTS & OTHERS [2015-2016] 1 SCGLR 605 @ 620
In the light of the provisions of sub rule (2) where a court finds that it cannot come to the above quoted conclusion without extrinsic evidence such a pleading will not be struck out under order 11 rule 18(1)(a)
What was the basis for the learned trial judge’s refusal to grant the application? He stated that without the contract between the respondents and Belstar Development Ltd he found himself unable to grant the application to strike out the statement of claim. The appellant’s answer is that it was the duty of the respondents to attach such a document to their affidavit in opposition.
Such an act would have offended sub rule (2) since no extrinsic evidence is permitted in such an application and would have amounted to an error on the part of the court had it considered such a document in arriving at a decision on the application.
Further, the court held that were the appellant to “decide not to do anything” about the respondent’s claims (that is where the respondent’s claim is proved), it would “surely impact negatively” on the appellants. The court also stated that should the appellant go on with their activities, the respondents stood to suffer a loss by way of loss of commission.
Clearly what the court was saying was that if the facts were proved, the respondents would be entitled to some compensation for loss of commission from the Appellants. One of the appellant’s claims is general damages for unlawful interference. These are issues which arise from the statement of claim and so the respondents were not to be driven away without a hearing.
It is to be concluded from the above statements by the trial court that it was of the opinion that if the facts in the statement of claim were proved the respondent would be entitled to at least one of the reliefs sought.
The appellants also contend that since Belstar Development Limited mentioned in paragraph 3 of the statement of claim was the Respondents principal, the former were the proper persons, in law to bring the present action.
I understand the appellant to be saying that even if the facts in the statement of claim are assumed to be true, the respondents as agents would not be entitled to judgment because they do not have the locus to bring this action so to speak.
The court refused to go into the issue of agency at that stage of proceedings.
It is my considered opinion that it would take more than a deposition in an affidavit in opposition to make the respondent an agent. That would call for evidence and the learned trial judge was right in declining the invitation to strike the statement of claim out on the basis of the unproven agency relationship between Respondents and Belstar. Evidence would be needed to clearly establish this relationship. As stated earlier, the present application does not admit of extrinsic evidence.
Counsel for the appellant also alludes to privity of contract between the Ministry of Health and Belstar. It is trite that equity has made inroads into the common law position that only parties to a contract can sue on it. The trial court would have to decide whether the respondents are precluded by lack of privity from instituting this action. Evidence would need to be taken for that. See
HARLLEY v EJURA FARMS (GHANA) LTD supra @ 196
In conclusion, I am satisfied that the finding of the trial high court that further evidence such as the contract between respondent and Belstar was needed to determine the application and his refusal to go into whether or not respondent was an agent of the said Belstar at that early stage of the suit clearly show that this suit is not one of the plain and obvious ones which can be determined summarily on the ground that no reasonable cause of action had been disclosed by the statement of claim filed.
It is my considered opinion that the issues raised by the learned trial judge in his ruling show that there is “reasonable ground for argument as to the maintainability of the action” so an order of the kind sought by the appellant ought not to be made. See
DYSON v ATTORNEY-GENERAL  1 KB 410 @ 420
I find no merit in both grounds of appeal and dismiss them. The appeal accordingly fails in its entirety. The suit is to take its normal course.