IN THE SUPERIOR COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ACCRA - A.D 2017
MILLICOM GHANA LTD - (Plaintiff/Respondent)
DN NETWORK GHANA LTD - (Defendant/Appellant)
DATE: 16TH NOVEMBER, 2017
CIVIL APPEAL NO: H1/120/2017
JUDGES: ACQUAYE J.A. (PRESIDING), DZAMEFE J.A, AGYEMANG (MRS) JA
MR. REGINALD NII ODOI FOR DEFENDANT / APPELLANT
MR. BAFFOUR GYAN BONSU ASHIA FOR PLAINTIFF / RESPONDENT
In this interlocutory appeal against the ruling of the High Court (Commercial Division) Accra, delivered on 11th October 2016, the appellant seeks twin orders: to set aside the ruling of the court below, and to grant the defendant leave to amend its statement of defence.
These are the matters antecedent to the appeal:
The plaintiff/respondent (hereafter referred to as the plaintiff) by an amended writ of summons sought alternative reliefs grounded on an alleged breach of contract. More particularly, the plaintiff sought declarations that the contract between the parties had been breached by the defendant. It also claimed damages for the alleged breach, an order for payment of loss of earnings, as well as an order for the payment of interest on the said sum. In the alternative, the plaintiff sought a declaration that the defendant had infringed the plaintiff’s copyright, and that it was entitled to accounts on sums received under it, damages for the alleged infringement, and an order of perpetual injunction restraining the said conduct by the defendant and its privies.
It was the case of the plaintiff company that in June 2007, one of its directors who was also a shareholder, became the owner of the copyright of a software/application by which mobile phone subscribers could borrow airtime to make emergency calls. According to the plaintiff, in June 2008, it leased the copyright of the software/application together with a proposal of the mobile airtime credit service to the plaintiff for sixty years and that subsequent to this, the parties entered into two agreements: a sales agreement and another referred to as the Mobile Value Added Service Agreement (MVAS). It was the plaintiff’s pleading that these two agreements were breached by the defendant when it failed to carry out its obligations thereunder, thus disabling the plaintiff from carrying out its own obligations. The plaintiff pleaded furthermore that the defendant allegedly proceeded, without reference to the plaintiff, to use the service contained in the proposal, making it available to its 1,800,000 subscribers per month for four years.
The issues having been joined by the defendant, the trial proceeded and the plaintiff closed its case. The defendant then called two witnesses. It was while the defendant’s representative who was second to give evidence was giving his evidence in chief, that the defendant applied for leave to amend its statement of defence by inserting subparagraphs in its paragraph 27. The amendment was sought in these terms:
“i. the Defendant avers further that the loan credit service that it operates as TiGO Lend me Balance or TiGO SOS was introduced within the Millicom Group sometime in 2006;
ii. The Defendant avers further that the TiGO SOS service is based on an existing feature on its intelligent network;
iii. The Defendant says that it started implementing the TiGO SOS service after learning of the introduction of the same service in Milicom Paraguay;
iv. The Defendant avers that consistent with one of its global policies, it ‘copied with pride’ the implementation of the TiGO SOS service from Millicom Paraguay”.
The amendment sought was strongly opposed, and in its ruling, the court below refused to grant the application.
The learned trial judge gave three reasons for his ruling, and they were: that the amendment would cause undue delay in a matter that had already suffered a series of adjournments; that it would have the effect of changing the defence of the defendant, and prejudice the case of the plaintiff, as it would “constitute a surprise if not an ambush” to the plaintiff.
It is against the said ruling that the present appeal has been brought.
The appellant set out seven grounds of appeal which we reproduce as follows:
a. That the ruling is against the evidence on record;
b. That the learned trial judge erred in law when he failed to assign reasons in his ruling as to why the amendment would change the nature of the case of the Defendant;
c. The learned High Court judge exercised his discretion wrongly inholding that the amendment would change the nature of the Defendant’s case when he failed to consider that the amendment was only to aid the defendant lead evidence in support of the pleadings;
d. That the learned High Court judge failed to exercise his discretion judicially in holding that the amendment would lead to surprise when he did not give any reason for reaching that conclusion
e. That the learned High Court Judge wrongly exercised his discretion in holding that the amendment would lead to surprise when he failed to consider that the applicant was not pleading new facts;
f. That the learned trial judge acted on a misapprehension of the Defendant’s case when he failed to consider that the amendment was necessary to decide the real issues in controversy and therefore, wrongly exercised his discretion in refusing to grant the application for amendment;
g. That the learned High Court Judge failed to exercise his discretion judicially in refusing the application for the amendment of the Defendant’s pleadings on the ground that it would cause undue delay when he failed to consider that the amendment was necessary to settle the real issues in controversy.
It seems to us that the grounds set out are unnecessarily prolix, as they are simply repetitive: Grounds (c) - (g) complain of the wrongful exercise of discretion for various reasons. Effectively the seven grounds of appeal may be condensed into four, for, Grounds (b) and (d) complain about the same thing which is: that the learned trial judge failed to exercise his discretion correctly when without giving reasons, he held that the proposed amendment would spring a surprise as it would change the defendant’s case; Grounds (c) and (e) attack the learned trial judge’s exercise of discretion by which he refused an amendment that did not introduce new matters, as it was only to bring the pleadings in line with the evidence on record. And lastly, Grounds (f) and (g) both complain that the exercise of the judge’s discretion was wrongful, as it did not permit the real issues in controversy to be brought to the fore in pleading.
Because a complaint that a judgment is against the weight of the evidence led invokes our jurisdiction under Rule 8(1) of the Court of Appeal Rules CI 19 to rehear the matter, we will first deal with the other grounds of appeal which attack specific findings of the court below, and because they all complain about the learned trial judge’s exercise of discretion and are interlinked, we will consider grounds (b) - (g) together and make short work of them.
In our consideration of the said complaints, we must state at the outset that we recognise that our duty as an appellate court to interfere with the exercise of discretion prohibits the substitution of our discretion for that of the trial court. This is because an appeal is not from the discretion of the trial court to the discretion of the appellate court, see: Ballmoos v Mensah [1984-86] 1 GLR 724.
We are however empowered to interfere with such exercise of discretion where it is found to be “arbitrary, capricious and uninformed”, see per Baddoo JSC in Kyenkyenhene v Adu [2003-2004] SCGLR 142,and the court is satisfied that the trial judge exercised the discretion on “wrong or inadequate materials, if it can be shown that the court acted under a misapprehension of fact in that it gave weight to irrelevant or unproved matters or omitted to take relevant matters into account”, see: Owusu v. Owusu-Ansah [2007-2008] SCGLR 870, citing Blunt v Blunt .
In determining the propriety of the grant of the application, we have had regard to the matters that ought to exercise a trial court in the consideration of an application for the amendment of pleadings.
Order 16 of the High Court (Civil Procedure) Rules CI47 provides for the circumstances under which an amendment may be made by parties with or without leave of the court. Rule 5 thereof provides the various circumstances under which such may be made, including the alteration of the name, capacity or even the addition of a new cause of action provided relief has already been sought for it.
The overriding principle for the grant of leave seems to be captured in Rule 7 which provides that an amendment may be granted for the purpose of determining the real issues in controversy between the parties, and also to correcterrors or defect in the proceedings.
Thus an amendment may be allowed even up to the last moment with the caveat only that : “(i) no surprise results, (ii) it does not enable a party to set up an entirely new case or to change completely the nature of his case, (iii) it is not sought to add new parties, (iv) it will not do any injury to the opponent's case or prejudice him in some way which cannot be compensated by costs or otherwise, (v) the application be made bona fide and (vi) the proposed amendment will not cause undue delay or is irrelevant or useless or would merely raise a technical point,” see: Yeboa and Ors v. Bofour  2 GLR 199.
The learned trial judge indicated that his decision was arrived at after a determination that it would cause undue delay in the proceedings, surprise would result, and lastly, that the amendment sought would change the nature of the defendant’s case. Yet while the learned trial judge adverted to the matter of a series of adjournments that had already been allowed, as his reason for asserting that the amendment sought would occasion further delay, he did not however, explain how he arrived at the surprise element, or the determination that the proposed amendment would change the nature of the defendant’s case.
Upon careful scrutiny and consideration of the pleadings and the proceedings at the court below, we have not been able to find the justification for the said considerations the learned trial judge held himself to have been persuaded by, and which he failed to set out. On the contrary, it seems to us that rather than support the learned trial judge’s position, the record belied his assertion.
We have noted that the defendant altogether denied the existence of the contract alleged by the plaintiff, and furthermore, that it had infringed any copyright held by the plaintiff. The defendant also denied that it had received any software or application from the plaintiff, and further denied that it had used the plaintiff’s mobile service credit software/application without reference to the plaintiff. The defendant further pleaded that the MVAS agreement was never effective between the parties, and that in any event, it was provided therein that the provision of a particular service such as was alleged by the plaintiff (the mobile credit service) was contingent upon the signing of a separate contract which was never done.
In his sworn testimony, the defendant’s representative stated that the defendant was operating mobile loan credit services. He went further to explain that the said service wasa program it had copied from its sister company in Paraguay which had first implemented it, and with which the defendant had been in discussion between 2006 and 2009. It is on record that the said piece of evidence was not objected to, and that it was after the said witness sought to introduce emails as evidence of this, that an objection was made. It is the said objection that gave rise to the defendant’s application which was refused and is the subject of the instant appeal.
By reason of the aforesaid matters of pleading and evidence, it seems to us then - in spite of the lengthy arguments made by the respondent in its submission to the contrary, that the amendment would not have had the result of prejudicing the respondent or overreaching its case, as there was no surprise element (or ambush) in the amendment sought, nor would it have had the effect of changing the nature of the defendant’s case when it would only have brought the pleadings in line with the evidence already led.
The nature of a party’s case may be said to have been changed when by a proposed amendment, such new matters are brought into the fray that they cannot be in answer to issues joined or relief sought, and will result in a reconstruction of the party’s case, see: Nkrumah v Serwah and Ors [1984-86]1 GLR 190; or introduces a new case altogether that maybe more appropriate in a fresh suit.
Nor can we deny that the amendment sought would have aided the court to determine the real issues in controversy. In the instant matter, one of the main issues in controversy was whether the mobile credit service that was offered allegedly to (one million, eight hundred thousand (1,800,000) of the defendant’s subscribers per month, for four years,was the service contained in the proposal the plaintiff averred it had submitted to the defendant and in respect of which a lease hold agreement had allegedly been entered into by the parties, furthermore, whether by reason of the alleged breach of contract and the alleged use of the said service, the plaintiff was entitled to inter alia, damages and loss of profits. In such a case where the defendant had flatly denied all these matters, it seems to us that apleading that the service in current use by the defendant emanated from another source: the defendants existing Intelligence Network and the experience in implementation from its sister company, Millicom Paraguay, and not the plaintiff, is important for a proper joinder of issues, and for the determination of the real issues in controversy.
We are unable to agree with the respondent’s position that the amendment would not answer any of the issues in the suit. On the contrary, we find that central to the suit is the question of whether there was a contract between the parties grounded upon the delivery of a software to the defendant by the plaintiff, and whether there was breach of any contract and/or infringement of the plaintiff’s copyright when the defendant offered a similar service to its customers. The defendant’s denials joined issue on these, and a pleading of facts to indicate how the defendant came by its software is in our opinion, neither a mere technical point, nor unfairly prejudicial to the plaintiff’s case.
Thus, beyond the fact that the amendment sought was to plead facts in respect of which evidence had already been led without objection, see: Edward Nassar Co. Ltd v Abu-Jawdi  GLR 523, also Mahama Hausa v Baako Hausa  2 GLR 469, the amendment sought was by reason of the matters aforesaid, proper and relevant, and the refusal thereof appeared to be “arbitrary, capricious, and uninformed”.
Nor was the final reason given: that there had been delays brought about by adjournments, sufficient reason to refuse the application in the face of the weighty matters to which we have had recourse.
It is our view that the learned trial judge exercised his discretion wrongfully when he refused the amendment sought, for the said reasons.
Having had our jurisdiction to rehear the matter, under Rule 8(1) of the Court of Appeal Rules CI 19, see also Oppong Kofi and Ors v. Attibrukusu III  1 SCGLR 176 invoked by the omnibus ground that the ruling was against the weight of the evidence, we have examined the record and find the following: that the ruling of the court below failed to take into account of the relevant matter of the amendment being sought to bring to a determination the real matters in controversy, and furthermore, that it was to bring the pleadings in line with the evidence already led. Rather, it appeared to take into consideration alleged matters of surprise, and a change of the nature of the defendant’s case (which were not supported either by the pleadings or by the evidence led), and lastly, the court concerned itself with the irrelevant matter of delay, when it was not demonstrated that the amendment was merely technical and virtually useless. It was therefore in our judgment, indeed against the weight of the evidence.
We are fully persuaded that the amendment sought was proper, and that a refusal would rather be unjust as it would keep from the fray, matters that the defendant may rely on for a robust defence. A closed door would most certainly in our judgment, work an injustice in these circumstances.
We find then that the appeal has merit and is accordingly allowed.
We go ahead, in the exercise of our jurisdiction under Rule 31 of the Court of Appeal Rules CI 19, make an order granting the amendment sought by the defendant/appellant.
Costs of GHC 1,000.00 to the Defendant/Appellant.