JUDGEMENT

On 10^th April, 2014 the Plaintiff instituted the present action against the Defendant herein seeking the following reliefs:

a. The payment of One Hundred and Twenty-One Thousand, Three Hundred and Sixty Ghana Cedis, Twenty Pesewas (GHC121,360.20) being the amount outstanding in respect of the facilities granted to the 1st Defendant.

b. Interest on the said sum upon the terms of the facilities, from 14th March, 2014 till date of final payment.

c. In addition to or in the alternative, an order for judicial sale of 2nd Defendant's property contained in Deed of Mortgage.

d. Costs.

The facts of the case are that on 5^th August, 2004 the Plaintiff granted a loan facility of Fifteen Thousand Ghana Cedis (GHC15, 000.00) to the 1^st Defendant. The 1^st Defendant used property H/NO. PLOT 15 BLOCK 'X', GYINYASE, KUMASI as security for the loan. The said property belongs to the 2^nd Defendant. The title deed of the property was lodged with the Plaintiff Bank.

The 2^nd Defendant subsequently commenced an action at the Circuit Court on the 26^th day of February, 2014 against the Plaintiff and the 1^st Defendant herein for, amongst other things, release of his title documents from the Plaintiff bank but same was refused by the Court on the ground that the Plaintiff bank had a lien over the title deed since same had been used as security for 1st Defendant's unpaid debt.

Parties’ Case

The Plaintiff bank states that as at 14th March, 2014, there was an outstanding amount of One Hundred and Twenty-One Thousand, Three Hundred and Sixty Ghana Cedis Twenty Pesewas (GHC121, 360.20) to be paid by the 1st Defendant on the facility which the 1^st Defendant had refused to pay despite repeated demands on it to do so.

The defence of the 1^st Defendant as stated in its Statement of Defence is basically that the Plaintiff's instant action is caught by the provisions of the Limitations Act, 1972(NRCD 54). Thus, the action is not maintainable, as it is statute barred. It is the case of the 1^st Defendant that the Plaintiff should be prevented from instituting this action, as they have intentionally allowed the loan facility to escalate in bad faith. Secondly, the 1st defendant avers that it does not owe any liability to the Plaintiff, as all outstanding debts to the Plaintiff Bank have been fully paid.

The defence of the 2^nd Defendant is that he is not a customer of the Plaintiff and that he never took a loan from the Plaintiff. He also insists that he never created a mortgage over his property in favour of the Plaintiff.

Issues

After unsuccessful attempts at settlement, the following issues were set down for trial namely:

1. Whether or not the Plaintiff's action is statute barred?

2. Whether or not 1st Defendant upon advice of Plaintiff's branch manager paid off the outstanding balance of the original facility and negotiated with the Plaintiff for cancellation of the accumulated interest?

3. Whether or not the initial loan agreement executed by the parties on or about 5th August, 2004 is still in force and binding on the defendants?

4. Whether or not the 1st Defendant's total indebtedness to the Plaintiff as at 14^th March, 2014 was GHC121, 360.20?

5. Whether or not the Plaintiff is entitled to its claims against the Defendant?

The Burden of Proof in Civil Suits Generally

As in all civil suits, the onus of proof first rests on the party whose positive assertions have been denied by his opponent. Depending on the admissions made, the party on whom the burden of proof lies is enjoined by the provisions of sections 10, 11(4), 12 and 14 of the Evidence Act, 1975 (NRCD 323) to lead cogent evidence such that on the totality of the evidence on record, the court will find that party's version of the rival accounts to be more probable than its non-existence. Indeed, this basic principle of proof in civil suits expounded in Zambrama V Segbedzie (1991) 2 GLR 221 has been subsequently applied in numerous cases including Takoradi Floor Mills v Samir Faris (2005/06) SCGLR 882; Continental Plastics Ltd v IMC Industries (2009) SCGLR 298 at pages 306 to 307; Abbey v Antwi (2010) SCGLR 17 at 19 (holding 2); and Ackah v. Pergah Transport Limited and Others [2010] SCGLR 728.

In Ackah v. Pergah Transport Limited and Others supra, Adinyira, JSC succinctly summed up the law, at page 736:

“It is a basic principle of law on evidence that a party who bears the burden of proof is to produce the required evidence of the facts in issue that has the quality of credibility short of which his claim may fail…It is trite law that matters that are capable of proof must be proved by producing sufficient evidence so that, on all the evidence, a reasonable mind could conclude that the existence of a fact is more reasonable than its non-existence. This is the requirement of the law on evidence under section 10 (1) and (2) and 11 (1) and (4) of the Evidence Act, 1975 (NRCD 323).”

Thus at the trial, the Plaintiff bore the burden of producing evidence and the burden of persuasion on the issue as to whether or not the 1^stdefendant is indebted to it the amount of GH₵ 121,360.20. The plaintiff was required to lead evidence to establish this claim and if it failed the court ought to enter judgment against it. Essentially, the burden of producing evidence of the 1^stdefendant’s indebtedness to the Plaintiff lied on the Plaintiff.

Tackling the Issues

I shall now proceed to resolve the issues which were set down for trial. In the analysis, the court shall also consider the written address of counsel for the Plaintiff. In fact, at the close of the case all the lawyers were ordered to file their written submissions. Counsel for the Plaintiff and 1^st defendant filed their written addresses but counsel for the 2^nd defendant failed to do so. This judgment is therefore delivered without the input (in terms of written address) of counsel for the 2^nd Defendant.

I shall proceed to discuss the issues to ascertain whether the Plaintiff has led cogent evidence to establish the claim that the 1^st Defendant owe it an outstanding amount of One Hundred and Twenty-One Thousand, Three Hundred and Sixty Ghana Cedis Twenty Pesewas (GHC121, 360.20) as at March, 2014.

I shall first tackle the first issue which borders purely on law i.e. whether the plaintiff’s action is statute barred. I shall then tackle the rest of the issues together since they are intrinsically linked and boils down to whether the plaintiff is entitled to its claim.

Is the Plaintiff’s Claim Statute Barred?

Counsel for the Plaintiff submitted in his written address that the current action is not statute barred, as there was a fresh accrual of the right to institute this action when the 1st Defendant made an acknowledgement of its debt under the loan facility. He relied on section 26 of the Evidence Act 1975 and submitted that the 1st Defendant is estopped by his own conduct from denying the existence of the debt.

Section 13(1) of the Statute of Limitation Act (NRCD 54) provides as follows: “No action shall be brought to recover any principal sum of money secured by a mortgage or charge on property, whether movable or immovable after the expiration of twelve (12) years from the date when the right to receive the money accrued”.

Subsection 3 of the section 13 further provides: “No action shall be brought to recover arrears of interest payable in respect of any sum of money secured by a mortgage or charge on movable or immovable property or to recover damages in respect of such arrears, after the expiration of six (6) years from the date on which the interest became due.”

From section13 of NRCD 54 it is easy to conclude that the current action is out of time since the loan facility was a short-term loan which was due in 2005. However, the right of the Plaintiff to institute the present action is revived by the exceptions provided in NRCD 54 such as acknowledgement or part payment of the debt. Section 17(1)(a) of NRCD 54 provides:

“In the following cases the right of action shall be deemed to have accrued on and not before the date of acknowledgement: (a) where any right of action has accrued to recover any debt and the person liable therefore has acknowledged the debt.”

The Black’s Law Dictionary (8th edition, 2004) defines acknowledgement of debt as: “A recognition by a debtor of the existence of a debt”. The profound question is: What amounts to an acknowledgement of a debt? In Chitty on Contracts, 31st edition volume 1 page 2000, the author commented on the form an acknowledgement must take when it was stated as follows:

“The acknowledgement must be in writing and signed by the person making it…As to the requirement of writing, the following (inter alia) will qualify: correspondence, an account rendered, a recital in a deed, a company’s balance sheet, an affidavit and a pleading” (emphasis mine).

In his defence to the action instituted by the 2nd defendant in the Circuit Court for the release of his title document, the 1^st defendant stated that the document was being used as a collateral to secure a lawful debt owed to the Plaintiff Bank. Exhibit H, the judgment of the court bears this out. At page 4 of the judgment, the Court stated as follows:

“The Defence of the 1^st and 2^nd Defendants is that, the Plaintiff pleaded with the 2^nd Defendant to assist him obtain a loan facility from his bankers and offered to secure same with the documents on his house… They denied the particulars of fraud and stated that, the Plaintiff’s obligation under the loan guarantee agreement has not ended and that, the Plaintiff at all material times was aware of the events leading to the grant of the loan”.

It is my considered opinion that this defence amounts to an acknowledgement of the outstanding debt claimed by the Plaintiff. The Statement of Defence of the 1st defendant filed before the Circuit court meets the threshold set by NRCD 54, as it was in writing and signed by the 1st defendant.

Furthermore, a party’s pleadings in an action can be used as evidence in a subsequent action and relied upon as evidence. In Grindell v Bass (1920) 2 Ch 487, Grindell sought to enforce against Bass specific performance of a contract for the sale of a house. Bass in his statement of defence pleaded that he had already contracted to sell the house to Earle. Grindell subsequently joined Earle to the action as a defendant and Earle, relying on Bass’ defence counterclaimed for a declaration that he was entitled to the house. It was held by Russel J that the pleadings made by Bass constituted sufficient memorandum to support Earle’s counterclaim.

Therefore, the requirement of writing in NRCD 54 can be satisfied by the pleadings of a party acknowledging the debt. In the instant case, the pleadings of the 1st defendant amount to an acknowledgement which revives the right of the plaintiff to institute the present action, the result is that the instant action is not statute barred.     

Is the Plaintiff entitled to its claim?

Exhibit A is the application letter for the loan facility secured by the 1^st defendant and it is dated 21^st January, 2004. Exhibit C is a statutory declaration of the 2^nd defendant authorizing the 1^st defendant company to secure his property as a guarantee for a loan from the plaintiff. Exhibit D is the loan facility agreement which shows that an amount of C150 million (GHC 15,000.00) was approved for the 1^st defendant and the same was accepted on behalf of the 1^st defendant by Nana Fosuhene, the Managing Director of the 1^st defendant herein. In exhibits E and F letters dated 5/9/2006 and 20/11/2016 respectively the said Nana Fosuhene wrote to the 1^st defendant bank pleading with it to reduce the accumulated interest on the loan or to write off the 1^st defendant’s indebtedness. From the wording of Exhibit F, there was an outstanding balance of One Hundred and Eleven Million Cedis

(GHC 11,100) as at 20^th November, 2006. This request did not obviously meet the kind consideration of the plaintiff bank, which is why on 24^th February, 2011 the plaintiff per a letter directed at the 1^st defendant requested it to pay an amount of GHC 110,723.12 being the outstanding indebtedness within 14 days. It is also clear from Exhibit J, the account statement that as at 14^thMarch, 2014 the total indebtedness of the 1^st defendant stood at GHC 121,360.20. Beside the bare denial by the 1^st defendant of its indebtedness to the plaintiff, no evidence was led to controvert Exhibit J.

In DUAH v YORKWA (1993-94) GLR 217, Holding 5, it was held:

“Whenever there was a written document and oral evidence in respect of a transaction, the court would consider both the oral and documentary evidence and often lean favorably towards the documentary evidence, especially where the documentary evidence was found to be authentic and the oral evidence is conflicting.”

This position has been affirmed in the cases such as Agyekum v Bio, Unreported, Civil Appeal No.J4/59/2014, 13th April 2016 and Agyei Osae v Adjeifio (2007-2008) SCGLR 499.

In the instant case, I find the documentary evidence to be credible as against the defendants’ improbable assertions and conclude that the 1^st defendant is indebted to the plaintiff the amount of GHC 121,360.20 as at March, 2014. It is also clear that the 2^nd defendant used his property as security for the loan facility – in fact that issue has already been resolve in the Circuit Court case supra.

From the reasons above, the plaintiff’s claim succeeds.

Accordingly, I enter judgment in favour of the plaintiff against the defendants in the amount of One Hundred and Twenty-One Thousand, Three Hundred and Sixty Ghana Cedis, Twenty Pesewas (GHC121, 360.20) plus interest at the commercial bank rate from 14^th March, 2014 till date of final payment or in the alternative judicial sale of the 2nd Defendant's property contained in the Deed of Mortgage to defray the whole or part of the judgment debt.

Costs of GH¢6,000.00 awarded against the Defendants.