CAPE COAST - A.D 2018
JAMES KOFI MENSAH - (Plaintiff/ Respondent)



In this appeal against the judgment of the High Court Sekondi, dated 14th January, 2016 the 1st Defendant/Appellant seeks to set aside the judgment which the Court entered in favour of the Plaintiff/Respondent.


These are the matters antecedent to the appeal:-


The Plaintiff per his amended writ, claimed at the Court below against the Defendants jointly and severally as follows:-

a. A Declaration that the Plaintiff won the stake with the 1st

Defendant’s company for the draw date 22/5/2010 referred to as event on numbers 73-22 for stakes totaling Gh1,500.00 entitling Plaintiff to the payment of Gh106,110.00 by the Defendants.

b. An order compelling the 1st Defendant to make good an outstanding balance amount of Gh100,100.00 being outstanding balance owed Plaintiff by the 1st Defendant.

c. Interest on the said amount of Gh100,100.00 from 22/5/2010 to date of final judgment and payment.

d. Any other reliefs as this Honourable Court may deem fit so to grant in the circumstances.


The case of the Plaintiff is that on 22nd May, 2010 he staked the number 73-22-58 with the 1st Defendant through the 2nd Defendant who is an agent of the 1st Defendant in Takoradi near the Black Market area. That he permuted the said three numbers and staked each for Five Hundred Ghana Cedis (Gh500.00) totaling One Thousand Five Hundred Ghana Cedis (Gh1,500.00).


According to the Plaintiff the 1st Defendant operates different types of lottery and the one that he staked and won is the Saturday Lotto. The numbers drawn on that Saturday May, 22nd, 2010 were 73-37-40-22-53. Out of the numbers drawn on that Saturday, he won on the number 73-22. He stated that by that win he was entitled to be paid an amount of Gh106,500.00.


Upon presentation of the winning coupons to the 1st Defendant it acknowledged receipt of the winning coupons. The said acknowledgement receipts were tendered in evidence by the Plaintiff without objection and marked as Exhibits ‘A’, ‘A1’ to ‘A6’ and ‘B’, ‘B1’ to ‘B6’.


The Plaintiff testified that when he presented the winning coupons to the 1st Defendant some of the coupons were not accepted on the ground that portions were torn and others were not properly marked. The Plaintiff tendered without objection the said torn coupons and those that were said not to have been properly marked as Exhibits ‘C’, ‘CI’ to ‘C5’.


The Plaintiff further stated that the 1st Defendant after acknowledging receipt of the won coupons requested the Plaintiff to return in three days’ time to collect his money which he did. The 1st Defendant on that day made part payment totaling Gh6,390.00 with cheques which were tendered in evidence without objection and were marked as Exhibits ‘D’, ‘D1’ and ‘D2’. The Plaintiff closed his case without calling any witness.


The 1st Defendant gave evidence through its officer who described himself as Head of Compliance, Enforcement and Inspectorate Section in Accra. According to the witness, the 1st Defendant Authority on 22nd May, 2010 conducted a draw on its Saturday Lottery and after that there were heavy wins. As part of the 1st Defendants Authority’s normal procedure, each time there is a heavy win from the draw, it conducts investigations. The Plaintiff submitted a purported winning tickets to the Office of the 1st Defendant Authority in Takoradi that he had won the draw held on 22nd May, 2010. The Plaintiff requested that the 1st Defendant Authority paid him. Accordingly, the 1st Defendant Authority issued acknowledgment receipt for the tickets. The 1st Defendant Authority realized the tickets the Plaintiff submitted were among the heavy wins of 22/05/2010 so, the 1st Defendant Authority instructed that investigations be carried out to ascertain whether the tickets were genuine. The investigations revealed that those tickets were subject of a stolen coupon which was never issued per the approved procedure by the 1st Defendant Authority. As a result the 1st Defendant Authority instructed its Takoradi Manager to effect the arrest of the 2nd Defendant from whom the purported tickets were issued. This led to further arrest of a staff of the 1st Defendant Authority, one Andrew Ahadze. Subsequently the arrested persons were charged and tried before the Circuit Court, Accra. Ahadzi pleaded guilty that he stole the coupons and gave them to the 2nd Defendant to sell and share proceeds. At the end of the trial both were convicted and sentenced. He tendered without objection the judgment of the Circuit Court which was marked as Exhibit ‘1’. The witness went on to state that the 1st Defendant Authority had not paid the Plaintiff for his win because the purported win did not meet the validation requirements.


The witness explained that the validation process involves the acknowledgement of receipt of the ticket, checking whether the ticket is genuine in accordance with National Lotto Act, whether the ticket/coupon issued by the 1st Defendant Authority to the Retailer/Marketing Company had been pre-paid for it. He contended that the tickets presented by the Plaintiff were not issued by the 1st

Defendant Authority to any Retailer/Marketing Company so it was never paid for, hence the 1st Defendant Authority cannot be held liable for the Plaintiff’s wins.


The witness also contended further that the Plaintiff has not been paid because the coupons were not purchased through the 1st Defendant Authority’s approved laid down procedure. The witness stated further that the 2nd Defendant is not an employee of the 1st Defendant Authority but rather an agent of the Lotto Receivers Union Company which is independent of the 1st Defendant Authority. After the evidence of these witnesses, the 1st Defendant called two (2) more witnesses.


After the close of the trial and the judgment of the High Court in favour of the Plaintiff for the reliefs endorsed on the Writ, the 1st Defendant aggrieved by the decision filed a notice of appeal and notice of additional grounds of appeal on 16th March, 2016 and 11th April 2016 respectively.

The ground of Appeal filed on 16th March, 2016 read as follows:-

(a) That the Learned Trial Judge erred in law when he held that the rule in Turquand’s case was applicable to the facts of the case in spite of the fact that the operations of the 1st Defendant/Appellant being a statutory entity cannot be brought within the ambit of such rule.

(b) That the Learned Trial Judge erred in law when he failed to hold that by reason of the fact that the coupons sold to the Plaintiff/Respondent by the 2nd Respondent/Respondent was stolen by the latter, it could not have grounded any claim by the 1st Defendant/Appellant.

(c) That the Learned Trial Judge erred in law when he held that the 2nd Defendant/Respondent was the agent of the 1st Defendant/Appellant when as a matter of fact and law, the 2nd Defendant/Respondent was an independent contractor who conducted his work without any instructions from the 1st Defendant/Appellant.


(d) That the Learned Trial Judge misdirected himself in law when he held that the 1st

Defendant/Appellant was liable for the acts of the 2nd Defendant/Respondent which said finding is inconsistent with the evidence laid before the court.

(e) That the Trial Judge erred in law when he failed to hold that by reasons of the fraudulent conduct of the 2nd Defendant/Respondent who sold the coupon obtained through stealing to the Plaintiff/1st Respondent. The said criminal act vitiated the claims of the Plaintiff/1st Respondent against the 1st Defendant/Appellant.

(f) That the Learned Trial Judge erred in law when he held that the 1st Defendant/Appellant had held out the Plaintiff/1st Respondent as its agent when there was no evidence on the record to sustain such a finding of fact.

(g) That the Learned Trial Judge erred in law when he failed to address his attention to the Lottery Regulations, 2008 (L.I. 1948) the effect of which rendered the coupon sold by the 2nd Defendant/Respondent to the Plaintiff invalid.

(h) That the judgment is against the weight of the evidence


The additional grounds of appeal filed on 11th April, 2016 are the following:-

(1) That on a combined reading of Section 55(e) of the National Lotto Act, 2006 (Act 722) and Regulations 9 and 10 of the Lotto Regulations 2008 (L.I. 1948) the Trial Judge erroneously assumed jurisdiction in the suit.

(2) That the Learned Trial Judge erred in law by failing to appreciate the jurist character of the 1st Defendant/ Appellant as a Statutory Corporation governed by the National Lotto Act, 2006 (Act 722), and therefore erroneously applied the principle of law, to wit, Companies Code to the facts and evidence adduced before the court.

(3) The Learned Trial Judge erred in law by treating the Plaintiff/Respondent as a bona fide purchaser for value without notice to the defective nature of the winning coupon by reason of his ignorance of the law relating to validation of wins, to wit, Lotto Regulations, 2008 (L.I.1948).

(4) Additional grounds may be filed upon receipt of the record of appeal.


For the purposes of this appeal we shall continue to refer to the Plaintiff/Respondent simply as the Plaintiff while the 1st Defendant/Appellant shall simply be referred to as the National Lotteries Authority (NLA).


We will consider all the grounds alleging errors of law on the part of the Trial Judge cumulatively and then consider separately the omnibus ground that the judgment is against the weight of the evidence.


In arguing the appeal, counsel for the NLA contended that the Learned Trial Judge committed an error in law when he applied the “indoor management rule” as enunciated in ROYAL BRITISH BANK VRS. TURQUAND [1856] 6 E & B 327 in dealing with a statutory entity such as the National Lotteries Authority.


He argued that although the Learned Trial Judge did not expressly allude to the internal management rule in his judgment, it is evident from the judgment that this legal principle underpinned his conclusion.


The rule in the Turquand case supra is to the effect that people transacting with companies are entitled to assume that the internal regulations of such a company have been complied with.


In the judgment under review, the Learned Trial Judge stated thus:-

“In my humble view, it suffices if a staker goes to stake lotto from the 1st Defendant’s designated/identifiable sales point and buys coupons which ostensibly look like those normally issued by the 1st Defendant authority. The staker has no business finding out or knowing what goes on in the 1st Defendant’s company before the coupons get to its agents for sale neither has he a duty to find out whether the coupons have been properly issued according to the accepted procedures within the 1st Defendant’s company”.


It was from the exerpt supra in the judgment that generated the arguments from counsel for the 1st Defendant. Counsel contended that the Trial Judge erroneously brought the operations of the NLA within the ambit of Company Law inspite of the fact that the legal relationship between the National Lotteries Authority the 2nd Defendant and 3rd Defendant is governed by statute i.e. the National Lotto Act, 2006 (Act 722) and the Lottery Regulations, 2008 (L.I.1948].


As counsel for the NLA rightly stated, the NLA is not a company registered under the Companies Act, 1963 (Act 179). The 1st Defendant is a creature by statute i.e. National Lotto Act, 2006 and its operations regulated by the Lottery Regulation, 2008 (L.I. 1948).


We have considered carefully the statement in the judgment which learned counsel for the NLA was of the view that the trial judge had applied the indoor management rule as enunciated in ROYAL BRITISH VRS. TURQUAND case supra.


We observed that the Trial Judge was considering the issue as to whether the 2nd Defendant worked as an agent for the NLA in selling the NLA’s lottery coupons and if so whether or not the NLA is liable for the acts of the 2nd Defendant in the sales of lottery coupons. Before the Trial Judge made the statement supra, he took pains to go through the testimonies of the parties during the trial and their answers in cross-examination.


The Trial Judge considered an agent as defined in Black’s Law Dictionary 8th Edition and Oxford Advanced Lerner’s Dictionary (International Student’s Edition). He considered the Term Agency by estoppel as defined in Halsbury’s Laws Of England 3rd Edition Volume 1 thus:-

“Agency by estoppel arises where are person has so acted as to lead another to believe that he has authorized a third person to act on his behalf and that other in such belief enters into transaction with the third person within the scope of such ostensible authority”


Section 5(1) of Act 722 provides:

“5(1) The Board of the Authority shall license Lotto Marketing Companies for the distribution and sale of coupons and for other purposes that the Board considers appropriate”.


Under Section 14(1) of Act 722 it is an offence for a person to operate as a Lotto Marketing Company without first obtaining a license from the Board.


Under Regulation 2(2) of L.I. 1948, the Board may grant a license only if:

(a) It will promote the sale of a lottery game, and

(b) It is in the public interest.


The L.I. 1948 places obligation on Marketing Companies to make security deposit necessary for the acquisition of a license which security deposit are determined by the Board of NLA. There are prohibitions placed on Lotto Marketing Companies under the L.I. 1948.


Under Regulation 7 it is provided as follows:-


Sale of lottery:

“7. A lottery may only be sold by:

(a) The Lotto Marketing Company named on the license, or

(b) A registered employee or agent of that Lotto Marketing Company”.


Under Act 723 and L.I.1948 only licensed persons/Marketing Companies are allowed to sell lottery tickets. It is mandatory under L.I.1948 (Reg. 8(3) for a Lotto Marketing Company to account to the Director General for each ticket sold in a draw failure of which it is an offence and on conviction attracts not only a fine but a term of imprisonment for not more than one year or both.


We took pains to go through the Act and Regulation supra because in our view, the NLA cannot distance itself from the persons or Marketing Companies it presents to the public to sell its lottery tickets.


As the Trial Judge rightly found, the NLA’s own representatives in their evidence stated that the 2nd Defendant sells their coupons. The Plaintiff’s unchallenged evidence on record is also that the 2nd defendant sells the NLA’s coupons openly in the streets and he knows that the 2nd Defendant works for the NLA. In his evidence on 22nd May, 2012 this is what the Plaintiff said in his testimony:

Q. You say you know the 1st Defendant entity, how do you know that entity.

A: I staked lotto with them and won, they paid me part and they still owe me.

Q: Before that what work do you know them as doing in this country?

A: They are lotto sellers.

Q: What about 2nd Defendant?

A. He is an agent for the National Lotto Authority and I have been staking lotto from him”.


From the record, there is abundant evidence that the 2nd Defendant at all material time was and acted as an agent of NLA and therefore NLA is estopped from denying vicarious liability for the acts and or omissions of its agents and employees. As the trial judge rightly stated there was ample evidence that the NLA as the principal of the 2nd Defendant represented to the whole world that the 2nd Defendant is its agents, and has authority to act on its behalf in selling lottery coupons to the public. The Trial Court therefore held that the NLA is bound in the same way as the 2nd Defendant would be if he incurred any liabilities in the course of exercising his authority.


The fact that the Trial Judge used the word “company” in the statement which has generated strong arguments that the Trial Judge brought the case within the ambit of the Turquand’s case which involves a company is not wholly correct.


In our view, the fact that National Lotteries Authority is a creature of statute, does not isolate it from the “indoor management rule”. We concede that it is the Act 722 and L.I.1948 that regulate the operations of the NLA but as to the day to day management and decisions taken, are entirely within the domain of the Board, and the National Lotteries Authority in general. The NLA implements the duties assigned them under the Law, and the public is not involved.


To understand the Trial Judge reasoning better, we find it pertinent to quote him in extenso:-

“The question here is did the Plaintiff know at the time of staking the lottery that the 2nd Defendant was selling a stolen coupons to him. Did he know that the coupons sold by the 2nd Defendant in the course of his dealings on behalf of the 1st Defendant had been stolen from the 1st Defendant’s custody by its employee and sold to him?


The other nagging question is, do prospective buyers in the course of events have to find out from the 1st Defendant or its marketers whether the coupons being sold to them have been normally issued through the 1st Defendant’s accepted procedures.


In my view, this is not what the reasonable man would do or is required to do. Requiring the staker to do so would be asking too much from the staker”.


Then the statement which is the subject of the complaint of counsel for the National Lotteries Authority followed:-

“in my humble view, it suffices if the staker goes to stake lotto from the 1st Defendant’s designated sales point and buys coupons which ostensibly looks like those normally issued by the 1st Defendant Authority……………….”


In respect of the argument that by reason of the fraudulent conduct of the 2nd Defendant who sold the coupon obtained through stealing to the Plaintiff, that criminal act vitiated the claims of the Plaintiff, the law is well settled that fraud vitiates everything if the fraud is proven.  See MASS PROJECTS LTD. NO.2 VRS. STANDARD CHARTERED BANK & YOO MART LTD. (NO.2) [2013-2014] 1 SC GLR 309.


In the instant case, the fraud now being canvassed was not part of the case of the NLA at the trial. The allegation was in respect of stealing. The alleged thiefs were tried and sentenced. No allegation of any criminal conduct was made against the Plaintiff. No evidence was led before the Trial Court to implicate the Plaintiff for either aiding or abetting in the stealing of the coupons. The fraud or stealing complained of is not the act of the Plaintiff so as to vitiate his win.


On the ground that the Trial Judge lacked jurisdiction to hear the matter because the Plaintiff failed to utilize Regulation 11 of L.I.1948 which provides that if a staker is dissatisfied with the decision he may appeal to the Board.


Counsel for the NLA argued strongly that where a statute imposes a condition precedent which must be satisfied in order to vest a cause of action in an individual, the said cause of action would not accrue until the said condition precedent is met.


Counsel for the NLA cited a plethora of cases in support of his arguments including SPOKESMAN PUBLICATIONS LTD. VRS. ATTORNEY – GENERAL [1974]1 GLR 88 AT 91; HEWARD MILLS VRS. HEWARD-MILLS [1992]1 GLR 153-165; BOYEFIO VRS. NTHC PROPERTIES [1996-1997] SC GLR AT 533.


Regulation 24(10) and (11) of L.I. 1948 provide:

24.(10) The Director-General’s decision in respect of the determination of a winning ticket or any dispute arising from the payment or award of a prize shall be final.

(11) A Claimant dissatisfied with the decision of the Director-General may appeal to the Board.




We observed that Regulation 24(11) is not mandatory but a discretion that is given a Claimant to appeal to the Board. In the instant case the decision that was taken not to pay the Plaintiff for his award or prize was not a decision that was taken by the Director-General pursuant to Regulation 24(9) whereby the Director-General had denied the award of a prize to a Claimant if the ticket is “printed or produced in error”. (Emphasis ours).


In our view, even if Regulation 24(11) is applicable it is not mandatory and therefore the jurisdiction of the High Court could not be ousted from handling the matter, as it is well settled that where the words in an enactment are clear and unambiguous no question of interpretation arises. See SAM VRS. COMPTROLLER OF CUSTOMS AND EXCISE [1971] 1 GLR 289.


We will now proceed to consider the omnibus ground of appeal which is that the judgment of the Trial Court is against the weight of evidence which counsel for NLA did not argue but which we find pertinent in view of what we found upon scrutinizing the documentary evidence placed before the Trial Court.


Under Rule 8(1) of the Court of Appeal Rules (C.I.19), an appeal is by way of rehearing. It was explained by their Lordships of the Supreme Court in TUAKWA VRS. BOSOM [2001-2002] SC GLR 61 at 65 per SOPHIA -AKUFO JSC (as she then was), that:-

“In such a case………………….it is encumbent upon an Appellate Court in a civil case to analyze the entire record of appeal, take account of the testimonies and all documentary evidence at the trial before arriving at its decision so as to satisfy itself that on the balance of probabilities, the conclusion of the Trial Judge are reasonably or amply supported by the evidence”.


In paragraphs 12 and 13 of the NLA’s statement of defence (page 84 of record of appeal) the NLA’s pleaded as follows:-

“12. 1st Defendant says that following the Lotto Draw of 22nd May, 2010, it

regional office in Takoradi Metropolis observed after validation of all winning coupons for the said Draw that lotto coupons with prefix UT 29 within the serial range of 10001-10500 of Gh100 denomination had been stamped and sold by Agents numbers 5510 and 5133, the said numbers owned and operated by Mr. Clement Agyei and Millicent Mensah, respectively, both agents and/or employees of the National Lotto Receivers Union Lotto Marketing Company.

13. 1st Defendant says further that after validation of wins it carries out

auditing to ensure that each ‘big win’ is genuine and during the said exercise realized that the said lotto coupons with prefix UT 29 within the serial range of 10001-10500 were not issued from its regional branch office in the Takoradi Metropolis for sale on prepaid basis to Lotto Marketing Companies and/or their agents and employees within the Takoradi Metropolis”.


In the evidence of the 1st Defendant’s Representative Atta Kofi Amoako on 11th February 2015, he testified that the Plaintiff submitted a purported winning ticket to their office that he had won the draw held on 22/5/2010 but their investigations revealed that those tickets were subject of a stolen coupon.


In cross-examination of the witness, he was shown the Exhibit ‘C’ series. He identified features on them as being in accordance with the National Lotto Act. He also acknowledged the Exhibit ‘A’ series as the acknowledgement receipt forms as well as ‘Exhibit ‘D’ series which were the photocopies of the cheques issued as part payment to the Plaintiff.


The 1st Defendant’s witness Emmanuel Sobo Blay (DW1) under cross-examination by counsel for the Plaintiff at page 303 of the record of appeal was also shown the Exhibit ‘C’ series which he admitted as National Authority coupons sold in pursuance of the 22/5/2010 draw.


Samuel Abo Koomson (DW2) who had held previously the positions of Internal Auditor, Accountant Regional Sales Manager and at the time his evidence was the Head of Treasury in page 309 of the Record of appeal testified thus:

“I know that the Plaintiff has sued National Lotteries Authority (NLA) for tickets that have not been paid for. At the time of the Plaintiff’s transaction, I was stationed in Cape-Coast. When we detected that tickets from NLA had been stolen, I was a member of the Committee set up to find out how it occurred.


We invited the Auditors to give us their findings and it was evident that those range of books were stolen.


The books with serial numbers 10001 to 10500 were those stolen.



Did the tickets that were issued to the Plaintiff fall within the booklet with Serial No.UT 29 10001-10500?


The “Exhibit C” series are some of the winning tickets that were issued to the Plaintiff when he staked on the 22/05/2010 but were rejected by the 1st Defendant upon presentation as torn and improperly marked. The “Exhibit C” series can be found at pages 473 to 474 of the record of appeal.


For ease of reference, we would try to arrange the “Exhibit C” series seriatim starting from page 474 of the record of appeal and continue at page 473.

Exhibit                                    Prefix/Serial Number


Exhibit “C5”  is                     UT/29  205071

Exhibit “C4”                        UT/29  205072

Exhibit “C3”                        UT/29  205073

Exhibit “C                            UT/29  205074

Exhibit “C2”                        UT/29  205075

Exhibit “C1”                        UT/29  206151


The accepted winning tickets presented by the Plaintiff and for which the NLA made part-payment were acknowledged by the NLA with the Exhibit “B” series.


The Acknowledgement Receipts are as follows:-

Exhibit                                    Prefix/Serial Numbers         


Exhibit “B1”  is                     UT/29  204931 - 40

                                                            205361 - 400

Exhibit “B2”                        UT/29  204881 - 204930

Exhibit “B3”                        UT/29  205061 - 70/76

                                                            205151 - 60

Exhibit “B4”            UT/29  206251 - 300

Exhibit “B5”            UT/29  205401 - 500

Exhibit “B6”            UT/29  200101 - 50


It is thus very clear on the face of the documentary evidence supra that the assertion of the National


Lotteries Authority that the tickets that the 2nd Defendant issued to the Plaintiff were part of the stolen booklet with serial No. UT/29, 10001 to 10500 cannot and was never true.


The only conclusion we could draw was that the 1st Defendant did not want to pay the Plaintiff because his win was a “big win”.


We are of the view that in the face of this clear documentary evidence the conduct of the NLA in fabricating a reason to deprive the Plaintiff from receiving the award of his genuine win is not only reprehensible but offensive to say the least.


The object of Act 722 inter alia is to raise revenue for the nation and for other purposes stated in the Act. The Board of the NLA in granting a license to Lotto Marketing Companies and persons are obligated to ensure that “it is in the public interest”. (See Regulation 2(2)(b) of L.I.1948.


If anytime the stakers of lotto genuinely win and win big, the NLA would find reasons to hide under the provisions of Act 722 and L.I. 1948 and deprive them of their awards or prize, then not only would the public lose confidence in the lottery run by NLA but it would deter the public from participating in it with its obvious financial consequences on the state revenue.


For these reasons, the entire appeal is hereby dismissed. The judgment of the High Court dated 14th January, 2016 in favour of the Plaintiff is hereby affirmed.