CAL BANK LIMITE vs RICHES CORNER COMPANY LIMITED & 3 ORS. & NANA BOAKYE
  • IN THE SUPERIOR COURT OF JUDICATURE
    IN THE HIGH COURT (COMMERCIAL DIVISION),
    KUMASI - A.D 2019
CAL BANK LIMITED -(Plaintiff)
RICHES CORNER COMPANY LIMITED & 3 ORS. AND NANA BOAKYE - (Defendant)

DATE:  4 TH JUNE, 2018
SUIT NO:  INTS/01/18
JUDGES:  ANGELINA MENSAH-HOMIAH (MRS.) JUSTICE OF THE HIGH COURT
LAWYERS:  KWADWO DEI KWARTENG FOR CLAIMANT
E.N. POKU FOR EXECUTION CREDITOR
RULING

 

On 30/08/2017, one Nana Boakye, who described himself as the attorney of Kofi Aboagye Nyame, filed a notice of claim in respect of House number 2 Block XI, Manhyia Extension, Kumasi which the execution creditor herein, CAL BANK LIMITED, had attached in execution. The claimant claimed ownership of the said property.

 

The execution creditor also filed a “Notice Of Dispute Of Claim” on 08/09/2017. Upon an ex-parte application filed by the Registrar of this court on 06/12/2017, an order was made on 08/01/2018 for the claimant and the execution creditor to appear in court for the determination of the issue of ownership of the house which has been attached.

When the parties to the interpleader application appeared in court, they were ordered to file their respective affidavit of interest and affidavit in response, and exhibit all documents relevant to the determination of the matter. Based on the depositions contained in the affidavits filed and the documents exhibited thereto, the court ordered both counsel to file their submissions, a further order was made for counsel to address the court as to whether the holder of a power of attorney can initiate proceedings in court in his own name.

 

The point raised by the court on whether the holder of a power of attorney can institute an action in his own name will be dealt with first. It is to be noted that counsel for the execution creditor did not file any submissions on this point. For the claimant, counsel conceded that Nana Boakye issued the notice of Claim in his name, but he disclosed the capacity in which he did so, that is, the attorney of Nana Aboagye Nyame, and proceeded to exhibit the said power of attorney. Counsel then argued that the capacity of the attorney has not been lost and the court can grant an amendment to reflect the capacity of the attorney. He cited and relied on the case of Kimon Compania Naviera S.A.R.P. & Ors v. Volta Lines Ltd (1973) 1 GLR 140.

The law is that the holder of a Power of Attorney who is mandated to sue, can only do so in the name of his principal, and not in his own name. In the Kimon Compania Naviera case referred to above, the court stated this legal position as follows (holding 1):

a person suing by a lawful attorney could only sue in the name of the principal and not in his own name…

 

In the above cited case however, the court did not close the door to the Plaintiffs who had to amend the title of the suit to reveal the real Plaintiffs who were in existence. In the instant case also, the Claimant has disclosed to the court that he is bringing the claim as the attorney of Kofi Aboagye Nyame. He ought to have issued the notice of claim in the name of Kofi Aboagye Nyame, acting per his lawful attorney and not the other way round. This error is however not fatal as there is ample evidence on record that the real claimant is Kofi Aboagye Nyame who has appointed Nana Boakye as his attorney. After perusing the Power of Attorney exhibited to the claimant’s affidavit of interest, exhibit ‘NB’, the court grants the Claimant leave to amend the title of the Interpleader application to read: Kofi Aboagye Nyame, per his lawful attorney Nana Boakye- Claimant.

 

Next, the substance of the application will be dealt with. In the affidavit of interest filed on behalf of the execution creditor, it has been deposed that Kofi Aboagye Nyame is the Lessee of the property in issue as per exhibit ‘NB 1’, the title deeds covering the property. The said Kofi Aboagye Nyame created a 30-year sublease out of his 82- year interest in favour of the Defendant /Judgment Debtor herein as in exhibit ‘NB 2’. It has further been deposed that this court in its ruling dated on 17/12/2012, granted an application for a Charging Order brought by Tanoah Capital Point Limited who was seeking to recover a judgment debt from Riches Corner Limited (the same Defendant/Judgment Debtor herein). Another deposition made on behalf of the Claimant is that, the Court Order of 17/12/2012 extinguished the 30-year proprietary rights of Riches Corner Limited in the property in issue. In his submissions filed in this court, counsel for the Claimant argued, among other things, that the property in issue cannot be sold because the proprietary interest of the head lessee goes beyond the 30-year sublease.

 

In the ‘Affidavit in Response’ filed on behalf of the Execution Creditor, it has been deposed that somewhere in January, 2009 Richard Osei Bonsu, the Managing Director of Riches Corner Company Limited approached Cal Bank Limited, the Execution Creditor herein, for a GHC 20,000.00 facility as a working capital and he used the property in issue as collateral for the said facility as per exhibit ‘AK 3’. It has also been deposed that the said Richard Osei Bonsu had used the same property in the year 2008 as security for a facility. The said Richard Osei Bonsu again used this property as collateral for a loan granted to a sister company, namely, Mary E. Enterprise, and upon default, both companies were sued in two separate actions. Per the Affidavit in Response, judgment was obtained in the Cal Bank v. Riches Corner Case after which the property in issue was attached. In the suit against Mary E. Enterprise, it has been contended that Nana Boakye filed an affidavit wherein he described himself as the Head of Family in place of Nana Kofi Aboagye Nyame (see exhibit AK 4), yet, he has turned round to describe himself as the attorney of Nana Kofi Aboagye Nyame. It is the case of the execution creditor herein that the instant interpleader application has been brought in bad faith to stall the execution process; that the ruling of this court, exhibit ‘NB 3’, was obtained by fraud as there is a mortgage over the property and it is after the mortgagee has been paid off that any other person can be paid.

 

It is not in doubt that Riches Corner Limited used the property in issue as security for a loan from Cal Bank Limited in January, 2009 and will ordinarily be entitled to any of the remedies available to a mortgagee. The remedies of a mortgagee under a mortgage contract include suing or filing an application for judicial sale; suing for the recovery of the debt and accrued interest, when the mortgagor fails to perform the acts under the mortgage after the date on which the acts that were to be performed under the contract has lapsed. The court may also appoint a receiver in a mortgage action. In effect, these are some of the remedies available to the execution creditor herein, it opted to sue and has duly obtained judgment. Meanwhile, the mortgage contract executed between the parties thereto was in respect of the 30-year sublease granted by the original lessee, Kofi Aboagye Nyame, to Riches Corner Limited. Ordinarily, it is only a mortgagor’s interest in the property, in this case, a 30-year sublease, which is affected by the mortgage agreement. In other words, a mortgagor cannot mortgage an interest which he does not have.

 

Per the affidavit evidence before this Court, the sublease, exhibit ‘NB 2’, gives the duration of the sublease as a period of thirty (30) years from 01/01/2006. So, the sub-lessee’s right will be extinguished by January, 2036. That apart, the Head Lease which forms part of exhibit ‘NB’ runs from 1st April, 1967 for a period of eighty-two (82) years. It is reasonable to infer from the above that the original lease will expire in the year 2049. Hence, upon the expiration of the sublease in the year 2036, the original lease will run for 13 years. This means that the Execution Creditor/Mortgagee herein cannot cause an outright sale of the property in issue. The Execution Creditor ought to have known of this fact at the time it executed the mortgage contract over the property, subject-matter of a sublease. In such circumstances, the appointment of a Receiver would be appropriate.

 

However, this court, without notice of the existing mortgage over the property dated 2009, granted a Charging Order in respect of the 30-year interest of Riches Corner Limited. Those Orders are contained in the Ruling of this Court dated 17/12/2012, exhibit ‘NB 3’. In the absence of evidence that the judgment debt in respect of which the Charging Order was made, has been liquidated, the Charging Order still subsists. In as much as the Court condemns the Claimant’s act of previously describing himself as a Head of Family, he has demonstrated that he has the capacity to bring this application as the lawful attorney of Kofi Aboagye Nyame. In so doing, the Claimant has brought material facts to the attention of this court which cannot be ignored, irrespective of his motive. The Court acknowledges that the Mortgage over the sublease in respect of the property in issue was first in time; and also, the judgment creditor, in whose favour the Charging Order was subsequently made is not a party to the instant interpleader application. In fact, that Judgment Creditor has no notice at all of what the instant execution creditor is seeking to do, that is, by issuing a writ of Fi.Fa. to dispose of the property in issue. Notwithstanding the circumstances under which the Charging Order was obtained, i.e. no disclosure of the existing mortgage was made to the court at that time, the Charging Order still subsists. This Court cannot make any contrary orders, until the previous Charging Order is set aside. Moreover, the Execution Creditor herein has indicated in paragraph 11 of the Affidavit in Response filed on its behalf that the Ruling of the Court, ‘exhibit NB 3’, was obtained by fraud as there is a mortgage over the property. With the greatest respect to counsel for the Execution Creditor, an allegation of fraud must be strictly proved, this cannot be done by way of affidavit evidence. The proper procedure to attack any Judgment or Order on grounds of Fraud is to issue a writ of summons and seek a declaration to that effect, and a further order to have that Judgment or Order set aside.

 

After a close examination of the processes filed with regards to the instant application, and upon a careful consideration of the submissions made by both counsel, this court concludes that Kofi Aboagye Nyame is the legal owner of the property described as House No. 2 Block XI, Manhyia Extension, Kumasi, which has been attached by the Deputy Sheriff. His leasehold interest is however, subject to the 30-year sublease in favour of Riches Corner Limited which is the subject-matter of the Charging Order made in the year 2012. In the circumstances of this case, the Execution Creditor cannot attach the property in issue by way of Fi.Fa. Accordingly, the execution process commenced by Cal Bank Limited by a writ of Fi.Fa. is hereby set aside. The Deputy Sheriff is ordered to withdraw from possession forthwith.

No order as to cost.