ALKE GHANA LTD. vs. PROTEUS CONSTRUCTION & MAINTENANCE LTD. & STAR ASSURANCE COM. LTD.
  • IN THE SUPERIOR COURT OF JUDICATURE
    IN THE HIGH COURT (COMMERCIAL DIVISION)
    ACCRA - A.D 2015
ALKE GHANA LTD - (Plaintiff)
PROTEUS CONSTRUCTION & MAINTENANCE LTD. AND STAR ASSURANCE COM. LTD. - (Defendants)

DATE:  8TH DECEMBER, 2015
SUIT NO:  OCC/52/2015
JUDGES:  HIS LORDSHIP ERIC KYEI BAFFOUR JUSTICE OF THE HIGH COURT
LAWYERS:  ELIZABETH ANDERSON YEBUAH, MRS WITH GEORGE ESHUN, ESQ., FOR PLAINTIFF/RESPONDENT
OSEI WUSU, ESQ., FOR DEFENDANT/APPLICANT SUMMERS DARKO, MS FOR 2ND DEFENDANT
RULING

It is provided under Order 11 rule 18(1)(b) and (d) of the High Court (Civil Procedure) Rules, 2004, C.

I. 47 that:

 

“The Court may at any stage of the proceedings order any pleadings or anything in any pleadings to be struck out on the grounds that:

 

(b) it is scandalous, frivolous or vexatious or

(d) it is otherwise an abuse of the process of the Court”

 

And may order the action to be stayed or dismissed or judgment to be entered accordingly”.

 

1st Defendant has mounted this application under Order 11 rule 18(b) & (d) seeking an order for the dismissal of the suit on the grounds that the suit is vexatious and constitutes an abuse of the judicial process.

 

The basis of the claim of the Defendant/Applicant has been stated in the 23 paragraph of the affidavit in support of the application and may be summarized as follows:

 

The Defendant/Applicant commenced an action in suit No. AC 740/2015 against Alke & Turmarks JV in the High Court differently constituted. That the facts giving rise to the cause of action in that suit is the same set of facts that has the foundation that Plaintiff/Respondent has mounted its action in this court; all emanating from a subcontract for the construction of a 60 bed hospital at Cantonments, Accra. To the Defendant/Applicant the Plaintiff herein has resisted the claim in the suit No AC740/15 and returned processes served on it because the Plaintiff/Respondent herein claim that it does not know the entity that styles itself as Alke & Turmarks JV and that it is only known simpliciter as Alke Ghana Ltd.

 

To the Defendant/Applicant it was the Plaintiff/Respondent herein together with Turmarks Company, an entity under the laws of Turkey that entered into a joint venture to perform the contract and cannot claim that it does not know an entity called Alke & Turmarks JV. And any reliefs that Plaintiff/Respondent seeks here could legitimately be sought by way of counterclaim in the earlier suit.

 

 

In an affidavit in opposition deposed to by one Yigitcan Yildrim, the Secretary to Plaintiff/Respondent company, he denied that Plaintiff was a party to the Suit No. AC740/2015 and that the joint venture agreement had not created any entity by name Alke & Turmarks JV in an incorporated form or not. He further notes that as Secretary to plaintiff/Respondent company his searches at Registrar General did not disclose the existence of any entity by name Alke & Turmarks that can sue and be sued. And hence the claim of the Plaintiff/Respondent is not frivolous or vexatious or capable enough of constituting any abuse of the judicial process.

 

Before dealing with the substantive legal submissions made for and against the motion, it is needful that I start with the first leg of the submission of the counsel for the Plaintiff/Respondent. It was contended that the Defendant/Applicant entered conditional appearance and has followed it up with this present motion. To counsel for the Plaintiff/Respondent as the application has not been brought within the fourteen day period granted a defendant under Order 9 Rule 8 of C. I. 47 the Defendant/Applicant is way out of time and this application ought not to be entertained. Counsel cited the case of REPUBLIC v HIGH COURT, ACCRA; EX PARTE ARYEETEY (ANKRAH INTERESTED PARTY) [2003-2004] SCGLR 398 in support of her claim.

 

Counsel for Defendant/Applicant filed a conditional appearance on the 1-9-15. By Order 80 Rule 2 the period of vacation is excluded in the computation of time for service, filing or amending a pleading. The fourteen days afforded the defendant under Order 9 rule 8 to apply to set aside the writ or service of it did not commence until after the expiration of the legal vacation. Defendant/Applicant filed its application on 16-11-15 way after the expiration of the fourteen days afforded him to set aside the writ or service of it.

 

From the nature of the application filed by the applicant I do not think that it is founded under the conditional appearance which the defendant entered. Long after the fourteen day period set down under Order 9 rule 8 expired, the conditional appearance was automatically converted into an unconditional one and if no defence had been filed it was for counsel for the Plaintiff to have filed a motion for judgment in default of defence.

 

Be that as it may the present application has been rooted under Order 11 Rule 18 that notes that the “court may at any stage of the proceedings” (emphasis mine) proceed to deal with any of the grounds stated under (a) to (d). I glean from the case of Ex Parte Aryeetey, that it was not opened for a party who had entered conditional appearance to move the court to have the writ set aside because he has a legal defence to the action however iron cast that defence may be. As the application is not founded on the conditional appearance filed by the Defendant; I think the application is properly before the court and that ground of resisting the application is dismissed.

 

Indeed if the Defendant/Applicant had rooted his application solely under Order 11 Rule 18(1))(a), then the rules expect such an applicant to have filed a defence as the nature of such application does not permit any affidavit evidence with the court only invited to look at the pleadings filed. However, when the Rule 18(1) (a) is combined with any of the sub rules up to (d) or is based on any of the sub rules other than (a), not having filed a defence may not be fatal to defeat the application as affidavit evidence is adduced in those situations. See the unreported Court of Appeal decision in SARA KUMI v STATE HOUSING CORPORATION H1/209/2012; also OTEMA v ASANTE [1992] 2 GLR 105 (Lutterodt J. as she then was). EVANSPENNY INDUSTRIES CO. LTD v TECHNO-CHEM ASSOCIATES LTD. [1992] PT 2 GBR 803.

 

Now to the respective substantive submissions: Counsel for Applicant canvassed that Alke Ghana Ltd is the same or related to Alke & Turmarks which is the defendant company in the earlier suit and whatever claim that Plaintiff is seeking here could legitimately be brought as a defence or counterclaim in the earlier instituted action. The Plaintiff/Respondent on the other hand claim that it is a total stranger to that suit as it does not know of any such entity by name Alke & Turmarks JV. It is necessary that I determine whether the plaintiff here is not only in form but in substance the same entity that has assumed a chameleon like nature metamorphosing its morphology depending on how convenient it is for it to do in order to come to the conclusion as to any abuse or otherwise of the judicial process.

 

Plaintiff/Respondent in its statement of claim filed in this suit claim that by an agreement between it and the Applicant the Applicant was engaged to construct a 60 bed hospital with the Respondent being the contractor for the project whiles the Applicant was engaged as a sub-contractor. Then Plaintiff/Respondent states under in paragraphs 12 and 13 of the Statement of Defence as follows:

 

“12. Initially the contract for the construction of the 60 bed hospital at Cantonments, Accra was executed between ALKE & TURMARKS GHANA LTD JV on the 20th of October 2014

13. Plaintiff avers that flowing from the execution of the contract between Alke & Turmarks Gh. Ltd JV, Messrs Protesus Ltd executed an advance payment bond … from Star Assurance …

 

14. Plaintiff says Messrs Protesu Ltd … caused Star Assurance Ltd to issue a performance bond in favour of Alke & Turmarks Ghana Ltd JV”.

 

And yet in an affidavit in opposition, Yigitcan Yildrim of Alke Ghana Ltd in paragraph 7 states that the Plaintiff/Respondent has always maintained and still do maintain that it is a total stranger to Suit No AC 740/2015 and that Alke Ghana Ltd does not know Alke & Turmarks JV. And again in paragraph 11 he further deposed that the joint venture did not create any entity whether incorporated or not as Alke & Turmarks. Is that so?

 

In Exhibit “C1” is a joint Partnership Agreement between Alke Ghana and Turmarks. The same exhibit also contains a document captioned Articles of Agreement in which an entity described as Alke & Turmarks. And in page 3 of that Partnership Agreement it notes that “the parties joint venture project will be the construction of a 60 bed hospital for Bank of Ghana, Accra”. In the Star Assurance

 

Performance Bond it is between Alke & Turmarks JV and the 2nd defendant herein. Ex ‘G’ attached to the Defendant/Applicant’s motion is a sheet that shows Yigitcan Yildrim, the Secretary for Alke Ghana Ltd who, as the Civil Engineer for the entity Alke Turmark.

 

There is no doubt at all that the claims in both suits relates to the same subject matter of a dispute arising out of the performance of the subtract in the construction of a 60 bed hospital. And therefore the two disputes arise out of the same cause. In determining the same cause the courts have noted that the test is whether the factual basis of the claim and the laws to be applied are the same with a view to obtaining the same basic outcome. There must always be the need to look at the substance of the claim rather than a formalistic and technical difference which usually cannot be invoked to defeat the raising of a claim of lis alibi pendens.

 

The rule is to the effect that proceedings on the same facts cannot be commenced in another court if the lis (the action) is already pendes (pending) in another court. Plaintiff/Respondent had sought to dismiss the first action in suit No AC 740/2015 on the ground that Alke Ghana Ltd was a different entity from Alke & Turmarks JV, whereupon Ofori – Atta J. dismissed the said application. As to whether or not the Plaintiff/Respondent is the same person as the Alke & Turmarks is an issue for determination before the earlier suit already pendens before the High Court but differently constituted, I think that the Plaintiff ought to file the claims he is making here by way of counter claim for all the issues to be determined.

 

As Lord Bingham stated in the English case of JOHNSON v WOOD [2000] 2 AC 1 @ 30-31 that:

 

“the bringing of a claim or the raising of a defence in later proceedings may without more, amount to abuse if the court is satisfied … that the claim or defence should have been raised in the earlier proceedings, if it was to be raised at all”

 

What happens if a court finds that the matter before it is lis alibi pendes as I so find here? Our Supreme Court in the case of IN RE APPLICATION BY NEW PATRIOTIC PARTY & PEOPLES CONVENTION PARTY (Applicants); TEHN-ADDY v. ELECTORAL COMMISSION [1996-97] SCGLR 216 the Supreme Court explained lis alibi pendens thus:

 

“By this principle, the Suit must be between two parties in one Court in respect of a given matter and one of the parties goes to another court within the same jurisdiction-seeking the same relief. In such a situation, either party may be put to his election as to the forum in which he would like to pursue his claim. In which case, the other suit may be dismissed or stayed pending the outcome of the other”.

 

And in the case of IN RE PARAMOUNT STOOL OF BAMIANKOR; EFFIAH IV V TAIBA II [2010]

SCGLR 37. Ansah JSC at page 58 of the record held thus:

 

“It becomes clear that in such a situation, the practice and procedure has been to put the Party suing to his election as to which forum to pursue his remedy and to stay proceedings in any of the action; it was not to strike out completely without putting the party to his election first”.

 

The court is not unmindful that it is bound by the decisions of courts higher than the High Court and that in classic situation of lis alibi pendes the court is to put the party at its election as to which of the two cases it intends to pursue. Nonetheless, I do not think that the present situation of lis alibi pendes is squarely within the usual one of putting a party at its election. And the reason is not far fetched. Plaintiff/Respondent has attempted to distance itself from an entity it has played a part in conceiving and winning a contract and has maintained that it does not know of the existence of such entity. In such a scenario it is needless for the choice to be made available to the Plaintiff as to which of the two suits he intends to proceed with. The invidious option is to strike the present suit so as to prevent a party from changing its status at its own whim and denying a status when he deems it convenient to do so.

 

The court has a duty to ensure that the same basic outcome is obtained in a claim arising out the same set of facts and also to ensure that suits that are connected and related is heard and determined to avoid the risk of irreconciliable decisions from two courts of coordinate jurisdiction.

 

Indeed Order 11 Rule 18 allows the court to exercise options either to stay it or dismiss it or to enter judgment accordingly. Staying the action is no option on the peculiar argument that Plaintiff mounted. The application is accordingly granted as prayed. The action mounted by Plaintiff in this suit is dismissed. Plaintiff can decide to proceed like the proverbial ostrich behaving that it has not been sued in AC 470/2015 or defend that action and also mount counterclaim.

 

I award cost of GH¢3,000.00 in favour of the Defendant/Applicant.