KUMASI - A.D 2018

DATE:  26 TH MARCH, 2018
SUIT NO:  RPC/12/17


In this suit, the Plaintiff Company seeks to recover from the Defendant the sum of GHC 126, 740.00 and interest thereon, as well as damages for breach of contract. The Defendant has also counterclaimed for breach of contract and recovery of monies allegedly due him. It is the case of the Plaintiff that on 24/03/2016, the Defendant purchased Vodafone Top-Up cards worth GHC 149.145.00 from its Kumasi office on credit, payable within seven (7) days.


The Defendant was unable to pay the said amount and subsequently gave an undertaking to settle his indebtedness. The Plaintiff further averred that the Defendant even issued cheques from one of his companies, CHAFAL COMPANY LIMITED for the purpose of paying off his debt but those cheques were returned. So far, the Plaintiff alleged that the defendant has paid GHC 22,405.00 leaving a balance of GHC 126, 740.00.00. In his statement of defence, the Defendant averred that the transactions were between the Plaintiff and Chafal Company Limited, a duly registered Limited Liability Company, whose line of business includes sales, marketing and redistribution of telecommunication networks credit card packages in the Greater Accra Region. He contended that their business relationship amounted to a Regional Jurisdictional Breach of the Plaintiff’s Agreement with Vodafone Ghana, and so the same was to be concealed from Vodafone Ghana.


As part of the agreement between the parties, the Defendant contended that he was entitled to a hold-back margin of 0.5% of sales, and as 1st December, 2015, the amount due him as “hold-back” margin stood at GHC 21,104.00, and it was agreed that it should be used in clearing some of his debts. With regards to the “Undertaking”, the Defendant averred that the Plaintiff gave the same to him to sign when no reconciliation had been done, and that the Plaintiff promised him of continuous supply of stocks so as to clear his outstanding debt if he signed the document. Yet, the Plaintiff violated the agreement by failing to make further supplies to him. Prior to that, the Defendant claimed shortages were recorded at various times between stocks consigned and actual stocks received, so the business started accumulating debts, and the same was communicated to the Plaintiff. The Defendant admitted making a payment of GHC 22,405.00 and went on to plead that the directors of Chafal Company Limited said he could not bind them by the agreement unilaterally signed at the Plaintiff’s office in April, 2016.


As regards the cheques, the Defendant alleged that it was the Plaintiff who advised him to issue those post -dated cheques for the easy clearing of the outstanding debt, but the Plaintiff was not to present the cheques until accounts had been gone into. The Defendant counterclaimed for his alleged unpaid holdback margin in the sum of GHC 21,104.40; another payment of GHC 71, 451.50 and damages for breach of contract. By way of Reply, the Plaintiff asserted that the trade arrangement with the Defendant was known to Vodafone Ghana, and because the Defendant crossed the Plaintiff’s territory assigned to it by Vodafone Ghana, it gave an upfront discount of 8.5% to the Defendant on all goods supplied. As regards the shortages, the Plaintiff stated that shortages worth GHC 10,740.00 was reported to it by the Defendant, at the time of the ‘undertaking’, and that amount was deducted from the Defendant’s indebtedness of GHC 143,388.00. Thus, the Defendant is not entitled to his counterclaim.



After an abortive pre-trial settlement conference, the issues below were set down for trial:

Whether or not the arrangement between the parties was for the Plaintiff to supply the items to the defendant on credit for the Defendant to pay for them within 7 days after supply?

Whether or not the defendant made a written undertaking to pay a debt of GHC 249,145.00 to the Plaintiff in respect of Vodafone Top -Up Cards purchased on credit from the Plaintiff?

Whether or not the Defendant is indebted to the Plaintiff to the tune of GHC 126, 740.00?

Whether or not there is a hold back margin agreement of 0.5% between the parties?

Whether or not the Plaintiff is entitled to his claim?

Whether or not the Defendant is entitled to his counterclaim?

Any other issue arising from the pleading. The issue of whether or not the Defendant is the proper person to be sued or Chafal Company Limited was added to the issues as arising from the pleadings.



The evidence of the Defendant on this point was that he is one of the two directors and also the Secretary of the Company that dealt with the Plaintiff, that is, Chafal Company Limited. Therefore, when a member of the Plaintiff Company by name Benjamin approached him in July, 2015 in respect of distribution of Vodafone Recharge Cards in Accra, an oral agreement was entered into between Nan-Tel Systems Limited as suppliers and Chafal Company Limited. He tendered the certificate of incorporation and certificate to commence business of Chafal Company Limited as exhibits ‘1’ and ‘2’ respectively. On this score, the Defendant said the Plaintiff dealt with Chafal Company Limited and not Kevin Atsu Wilson in his personal capacity. The Plaintiff’s evidence on this point was that it had always dealt with the defendant as an individual and never as a corporate entity. And, the name Chafal Company Limited was first introduced to the Plaintiff by the Defendant when he issued the post-dated cheques in favour of the Plaintiff. On this point, counsel for the Plaintiff conceded that a Company has its own distinct legal identity, different from its members; Ago Sai v. Kpobi Tetteh Tsuru III (2010) SCGLR 762 at 799; Morkor v Kuma (No.1) (1999-2000) 1 GLR 721 at 733 were cited and relied on.


That notwithstanding, counsel for the Plaintiff argued that the onus was on the Plaintiff to adduce cogent credible evidence, on the balance of probabilities, that it dealt with Defendant and not Chafal Company Limited. Adwubeng v Domfeh (1996-1997) SCGLR 660; and Zabrama v Segbedzi (1991) 2 GLR 221 relied on. It was counsel’s argument that the Plaintiff discharged this burden through its exhibits E, (bank Statement) and F, (Undertaking). In respect of exhibit E, counsel submitted that the Defendant personally made payments spanning from July, 2015 to April, 2016, into the account of the Plaintiff by using “Chafal Communications Ventures, his trade name. His argument was that if the Defendant never dealt with the Plaintiff, and it was Chafal Company Limited that dealt with the Plaintiff, the Company’s name would have been used to make those deposits into the Plaintiff’s account instead of the Defendant’s trade name. With respect to exhibit ‘F’, counsel submitted that the Defendant admitted his indebtedness and promised to pay in accordance with a certain schedule, and that the defendant signed the document willingly, without duress, undue influence or fraud. He argued that if it was the Company that dealt with the Plaintiff and owed it, the Defendant would have indicated the same and would not have admitted liability in person.


Counsel pointed out that the Defendant’s story that exhibit ‘F’ was not the result of any reconciliation but it was done to save the job of the Plaintiff’s representative, is a mere attempt to water- down the said “undertaken”. He reiterated that the Defendant dealt with the Plaintiff in his personal capacity under his trade name Chafal Communications Ventures prior to the execution of the document titled “Trade Terms and Conditions Revised”, executed between the Plaintiff and Chafal Company Limited. Consequently, that document cannot operate retrospectively so as to affect the previous transactions between the Plaintiff and the Defendant herein. On the basis of the foregoing, counsel concluded that the Plaintiff dealt with the Defendant and not Chafal Company Limited. For the Defendant, counsel re-echoed the principle of separate legal existence of companies, he relied on Marina Hotel Ltd v. Mensah (2016) 92 G.M.J. 153, Morkor v. Kuma (1998-99) SCGLR 620 and Salomon v Salomon & Co (1897) AC HL. It was his submission that prior to the commencement of the business, the Plaintiff requested for, and received full details of the incorporation of the Company they were to transact with. He referred to the following portion of the cross-examination between the Plaintiff’s representative and counsel for Defendant:

Q: You contacted Mr. Kelvin Atsu, a representative of the Defendant Company in or about May, 2015, is that not correct?

A: Yes, it is correct.

Q: You also requested from the Defendant’s representative his business registration documents, is that not the case?

A: Yes, but that was not immediate.

Q: So you are also aware that the Defendant transacts business under the name Chafal Company Limited?

A: We started dealing with him by the name Kelvin Atsu. It was when he started making payment that was when we saw the name Chafal Communications.


On this basis, counsel for the defendant argued that the Plaintiff has always been aware that it was not dealing with the Defendant in his personal capacity. Counsel again argued that when the parties documented their business relationship into agreement, the Plaintiff executed the agreement with Chaffal Communications Limited, with Kelvin Atsu representing the Company. That notwithstanding, counsel conceded that some of the payments which appear on the bank statement are in the name of “Chaffal Communications Ventures”, but others are simply captured as “Chaffal”. However, counsel for the Plaintiff conveniently left out the payments made in the name “Chaffal” simpliciter in his analysis.


The principle of separate legal existence of companies has been adequately addressed by both counsel in their written submissions and I do not intend to belabour that point. Per the evidence before this court, it is not in doubt that the supply of telecommunications recharge cards which has brought about this suit was governed by an oral agreement. It is also not in doubt that the business commenced in July, 2015. In the absence of any written agreement to evidence the relationship between the Plaintiff and Kelvin Atsu at the commencement of the business in July, 2015, the court will have to carefully examine the oral evidence of the parties and consider all surrounding circumstances. First, I will consider exhibit A. This document is the ledger account of “Chafal Communications Ventures”, entries therein start from 22/07/2015 to 02/11/2016. The Defendant did not object to the tendering of this document which also bears his name, neither was this document discredited during cross-examination.


This ledger account captures all sales made and payments received, including the subject matter of this suit, that is, supplies worth GHS 149, 145.00 made on 24/3/2016. Given the Defendant’s answers in cross-examination that payments were made either in cash or by cheque into the Plaintiff’s account at Cal Bank, an analysis of exhibit “E” will be helpful. At a glance, it can be seen that , “Chaffal Communications Ventures” made deposits into the Plaintiff’s account on 29/07/2015, 30/07/2015, 31/07/2015 and other subsequent dates. Indeed, “Chafal Communications Ventures” made a deposit of GHC 10,000.00 into the Plaintiff’s account as late as 11/04/2016. Those payments, from the Defendant’s own testimony, were in respect of supplies of recharge cards made and that same were consigned to “Chafal Communications Limited”through Kumasi-Accra bus courier services.


The Defendant indicated that on numerous occasions, he detected shortages upon receipt of the consignment and same were communicated to the Plaintiff Company. He attached some “store issue vouchers” and invoices covering the consignment said to have been dispatched by the Plaintiff Company, exhibits 2 series. Obviously, if there were any shortages at all, the same would have been detected by reconciling the details on the “invoices” or “store issue vouchers” with the actuals stocks received. In doing so, the consignee or his agent or representative, as the case may be, could not have feigned ignorance of the details or contents of the source documents which had Chaffal Communication Ventures as the consignee. Upon a further scrutiny of exhibits 2 series, some of the “invoices” and “store issue vouchers” bear the name “Chafal Communication Ventures”, others bear the name “Chafal Company Limited”. One striking difference is that whereas the invoices tendered as exhibits 2A, 2C, 2E, 2G and 2K, under the name ‘Chafal Communications ventures” are of uniform font and font sizes on each document, those tendered as exhibits 2, 2B,2D,2F and 2J under the name “Chafal Communications Limited” come in different font and font sizes. Upon a perusal of the exhibit 2 series, there is no doubt in my mind that the consignee’s name in exhibits 2, 2B, 2D, 2F and 2J have been altered to read “Chafal Communications Limited” instead of “Chafal Communications Ventures”.


From the foregoing, it is reasonable to infer that at all times material, the Defendant received the recharge cards which the Plaintiff consigned to “Chafal Communications Ventures”, and he made, or caused payments to be made to the Plaintiff’s bank account in the said trade name. The Defendant is obviously coming up the so called transaction with a Limited Liability Company to avoid his obligations arising from a transaction he entered into in his personal capacity. This is so because a Registered Company cannot legally carry out business in a name different from the registered name.

It is provided under section 14(5) of the Companies Act, 1963 (Act 179) that:

(5) From the date of registration mentioned in the certificate of incorporation, the Company is a body corporate by the name contained in the Regulations and, subject as provided in sections 27 and 28 is capable of exercising the functions of an incorporated company. (Emphasis added).


Sections 27 and 28 of Act 179 deal with the requirements prior to obtaining a certificate to commence business, i.e. filing of returns with the registrar in the prescribed manner including minimum stated capital. The certificate of Incorporation, exhibit 1A, dated 03/02/2014, put in evidence by the Defendant bears the name “Chafal Company Limited”. The same name appears on the certificate to commence business, exhibit 1. On the face of exhibit 1, “Chafal Company Limited” has complied with the provisions of sections 27 and 28 of Act 179. By the combined effect of section 14(5) of Act 179 as well as exhibits 1 and 1A before this Court, “Chafal Company Limited” could carry out business in that name only, from 05/02/2014.


Therefore, “Chafal Company Limited” could not have legally transacted business with the Plaintiff as “Chafal Communications Ventures”, as contended by the Defendant herein. As the Plaintiff’s evidence shows, all the Vodafone recharge cards in issue were consigned to “Chafal Communications Ventures. This makes the Plaintiff’s evidence that it dealt with the Defendant, trading under the name Chafal Communications Ventures, more probable, than not. Since the Defendant received the various consignments as per the authentic invoices sent, including the subject matter of this suit, under the name “Chafal Communications Ventures”, his version of the ledger account with the name “Chafal Communications Limited”, exhibit 5, is a self- serving document manufactured to fit the story line of the Defendant. The court finds that until 25/04/2016 when Chafal Company Limited, acting through Kelvin Atsu Wilson, executed the “Trade Terms and Conditions Revised” document, exhibit 6, all the previous transactions relating to the sale of Vodafone recharge cards were between Nantel Company Limited and “Chafal Communications Ventures”, the trade name of the defendant. So, “Chafal Communication Ventures” and “Kevin Atsu Wilson” do not exist as separate personalities, they are the same. Therefore, the proper person to be sued in respect of the indebtedness of “Chafal Communication Ventures” is its business owner, Kelvin Atsu Wilson and I so find.



There is no dispute that the Defendant wrote an undertaking to settle his debt to the Plaintiff. The point of divergence is the reason(s) for doing so. In paragraphs 11 and 12 of the Plaintiff’s evidence-in-chief, its representative explained the circumstances leading to the signing of the undertaking by the Defendant as follows:

The Plaintiff kept making demands on the Defendant for the payment of his indebtedness. The Defendant therefore moved to Kumasi for the discussion of his indebtedness at the Plaintiff’s office. During that meeting, a reconciliation was done and the parties agreed on an amount of GHC 132,648.00 as the amount owed and due to be paid to the Plaintiff by the Defendant. The Defendant even went ahead and signed an undertaking to that effect. This “undertaken” is attached and would be relied on in evidence.

On his part, the Defendant, in paragraph 15 of his evidence-in-chief, explained the reasons for signing the undertaking in these words:

Plaintiff per Mr. Benjamin Afrifa Kufour intimated to us that they were also planning to visit us in Accra. He further indicated that since his superiors were worried about our level of debt which places his job on the line, we should sign a letter of undertaking prepared by him and dated 12th April, 2016, on the promise that, that will assure them to keep supplying us until our indebtedness is honoured.


The said letter of 12th April 2016 was put in evidence by Plaintiff as exhibit F. It reads:





TELEPHONE: 0244 091101.




Dear Sir,

LETTER OF UNDERTAKEN (spelling as on document)

I, (KELVIN ATSU WILSON) of the above mentioned address writes to acknowledge my indebtedness in the sum of (GHC 132,648) ONE HUNDRED AND THIRTY-TWO THOUSAND, SIX HUNDRED AND FORTY-EIGHT GHANA CEDIS to NANTEL SYSTEMS LIMITED; which occurred as a result of our trading in VODAFONE TOP-UP CARDS with NANTEL SYSTEMS LIMITED. I do hereby pledge to settle the debt of (GHC 132,648) ONE HUNDRED AND THIRTY-TWO THOUSAND, SIX HUNDRED AND FORTY-EIGHT GHANA CEDIS;

I pledge to pay GHC 10,000 (TEN THOUSAND GHANA CEDIS) every two weeks commencing on the 26th of April, 2016. I also agree to the arrangement that NANTEL SYSTEMS LIMITED reserves the right to take legal action against me to recover the said amount.

I agree to bear the cost of legal services that NANTEL SYSTEMS LIMITED will incur in their quest to recover their money from me and my business. I hope the Management of Nantel Systems Limited will grant me the necessary cooperation in this regard.

Sgd. KELVIN ATSU WILSON            Date: 12-04-2016

Witness: Dr Jacob Plange-Rhule.


In his closing submissions, counsel for the Plaintiff was quick to point out that the figure GHC 249,145.00 is an error because it does not emanate from the pleadings, and the figure ought to have been GHC 132,648.00. The court agrees with counsel’s observation. Counsel submitted that the Defendant’s position that he signed exhibit F to save the job of Benjamin Afrifa Kufour is an afterthought and invited the court to ignore the same. In his view, the Defendant executed exhibit ‘F’ for the purpose for which it was given, and, he attached so much importance to it that he even relied on it in his CRISIS APPEAL LETTER”, exhibit D. The argument by counsel for the Defendant that the Defendant was deceived to sign exhibit ‘F’ so that he will be assured of continuous supply of products from the Plaintiff cannot erase the Defendant’s obligations thereunder. The Plaintiff’s representative has not denied making a suggestion to the Defendant that unless he acknowledged his debt in writing, the Plaintiff could not continue to do business with him. Counsel’s submission that the Defendant was deceived into giving the undertaking is untenable. The Defendant is a man of full age and understanding, he took products from the Plaintiff Company which he has not fully paid for and he knew that he was under an obligation to settle his indebtedness. Thus, if on the prompting of a third person, the Defendant has acknowledged his indebtedness in writing with a promise to pay the same, how does that amount to deceit in law?


If indeed the Defendant was deceived to execute exhibit “F”, which according to him, was prepared by the Plaintiff’s representative and presented to him to sign, what compelled him to rely on this document in exhibit D, the “ Crisis appeal Letter”? Exhibit “F” will be set out below for emphasis. It is dated 10th May, 2016 on the letter head of Chafal Company Limited and addressed to the Operations Manager of Plaintiff Company in Kumasi. It reads:

Dear Sir,


We respectfully write to solicit your support and partnered collaboration in the recent event when our business is challenged unexpectedly with a temporal cash flow crisis.

In reference to our letter of undertaking dated 12th April, 2016 covering our plan and commitment for instalment payment to settle our indebtedness on trade account with you, we find it ethical to share with you as our business stakeholder our current temporal business challenge which makes it difficult to honor our repayments as earlier established.

Please find below update on outlined crisis factors:

Glo Fraud Case involving a whooping sum of GHC 1.7million in which case we have been heavily victimized with the recall of our bank guarantee to pay for unreconciled stocks which they themselves have stolen from their vault; for which we are currently in court for redress. This has conditionally strike drastic decline on our operational capital.

In view of the spreading news on this development in the media, our regular trade partners/suppliers have limited the regular amounts of supplies to us.

After honoring major payments to our suppliers, unexpectedly they have drastically limited their supplies to us which have created a big gap in our trade cycle and cash flow pattern.

Unsuccessful and delayed recovery of debt owed by our customers and some major trade partners amounting to GHS 792,713.74.

Meanwhile, for purposes of business sustainability, the business is currently undergoing a 180 days restructuring process in order to mitigate the perils of this crisis and humbly request/appeal for the following support:

That with immediate effect you offer us a moratorium concession in which you will hold on our cheque for 90 days period after which payments will be resumed as sustainable arrangements are ongoing to realign the business.

We look forward that the existing goodwill between us and your company will manifest in this current temporal situation as appealed.

Counting on your anticipated cooperation.

Sgd. Kelvin Atsu Wilson         sgd. Jacob Plange-Rhule

Chief Executive Officer          Operations Director


The purpose for which the defendant executed exhibit ‘F’ is visibly spelt out in exhibit ‘D’, he did not do so to save the job of Benjamin Afrifa Kufour, neither was he deceived into signing the said undertaking. In fact, the Defendant’s explanation in Court for signing Exhibit ‘F’, is just a “smoke screen” aimed at blurring the court’s vision, that explanation is unacceptable. By the preponderance of the evidence before this court, I find that the Defendant voluntarily signed the document titled “undertaken” wherein he promised to pay his indebtedness of GHC 132,648.00. The attachment, that is, the commissioning of the document by a commissioner for oaths does not in any way affect the Defendant’s obligations under the undertaking given.


The post- dated cheques in the name of Chaffal Company Limited which the Defendant issued to settle his indebtedness takes the case to another level. From the incorporation documents before this Court, the Defendant is one of the two directors, as well as the secretary of “Chaffal Company Limited”. The Defendant was well placed to have access to documents of the said Company such as cheque books and letterheads. It becomes obvious that the defendant abused the Company’s letterhead to write the “CRISIS APPEAL LETTER”, and also issued out the post-dated cheques without recourse to the Company. These acts do not make the Company liable for the personal liabilities of the Defendant herein. I would dare say that those acts were part of the grand scheme of the Defendant to avoid paying his just debts, which he had undertaken to pay previously.



The onus of proof of this issue rests on the Plaintiff. The Plaintiff introduced oral evidence to the effect that payments for the products supplied were to be made within 7 days from the date of supply. The Plaintiff offered further explanation during cross-examination that the Defendant was unable to comply with this term and postponed the date to a couple of days. That notwithstanding, the Plaintiff supplied him with more products. It has not been disputed that the Vodafone Top Up cards were supplied to the Defendant on credit. I have perused exhibit A and it does not support the Plaintiff’s contention that payment was to be made with seven (7) days from the date of supply. It is reasonable to infer from exhibit A that the parties did not stick to a specific repayment time. Put differently, sales and payments were not made according to a particular schedule as gleaned from exhibit A. Thus, the Plaintiff has failed to prove on the balance of probabilities that the full payment for the products supplied was to be made within 7 days from the date of supply. In effect, the Plaintiff has not satisfactorily discharged the burden of persuasion placed on him relative to this issue.



This is an allegation made by the Defendant in his statement of defence which he is required to prove by the same standard of proof in civil suits. In proof of this fact, the Defendant testified per paragraph 8 of his witness statement as follows:

We also agreed that there would be a holdback margin of 0.5% on sale. This holdback was later supplied as credit cards in lieu of cash payment. Plaintiff gave me GHC 2400 in January, 2016.


In denial of this evidence, the Plaintiff gave evidence to the effect that there was an arrangement between the parties which entitled the Defendant to a discount of 8.5% of goods supplied and that the discount was used to supply more products. According to the Plaintiff, there was no agreement on any holdback margin and an amount of GHC 2000.00 credited to the Defendant’s account in December, 2015 as captured in exhibit A, was part of a promotion which was run by the plaintiff at that time. The description of the December 2015 entry as “discount allowed” has also generated another controversy. What then is the meaning of that entry? In this case, the journal entry under the narration “discount allowed” on 31/12/2015 as captured in exhibit A must be placed in perspective. Two types of discounts readily come to mind: (i) Trade discount; and (ii) Cash discount.


On the one hand, a “Trade Discount” refers to a reduction in price which a manufacturer or wholesaler gives to a wholesaler or retailer when they buy a product or group of products. Put differently, a trade discount is a certain percentage or amount which a manufacturer or wholesaler is willing to reduce from its list price. In effect, Trade discounts are deducted outright from the product’s listed price. Therefore, the seller records the sale at the price net of the trade discount; and the buyer records the purchase at net of the trade discount. This means that the price is recorded at net of the trade discount. In accounting terms, a “Trade Discount” is not reflected in the accounting system of both the seller and the buyer. On the other hand, a “cash discount” is granted for, let us say, an early payment of an amount due or as a special discount. In other words it is a reduction allowed by the seller in order to motivate the buyer to pay within a specified time. It is recorded in the books of the seller as “sales discount”; and in the books of the purchaser as “purchase discount”.


The net effect is that a cash discount will be a reduction to an expense. A “holdback” can also be described as a sum of money withheld under certain conditions. In trade terms, it may be a margin or percentage allowed by the seller as a commission, this becomes a profit to the buyer. This will pass through the accounting system or books whereby the actual price is recorded less the commission to arrive at the net payable. Applying these basic accounting principles to the case at hand, the 8.5% upfront discount which the parties testified about fits into the “Trade Discount” description and that is why there is no record of it in exhibit A.


From the evidence before this court, the parties commenced their business transactions in July, 2015. But, apart from the journey entry with the narration “discount allowed” on 31/12/2015, in both exhibits “A” and “4”, there is no entry with the narration “discount” in the ledger account. The argument by counsel for Defendant that there was a discount allowed of GHC 2400.00 is unsustainable, given the unresolved credibility issues surrounding exhibit “5”. If there was in fact any holdback agreement which entitles the Defendant to a commission, why is it that such entries were consistently not recorded in the Ledger Account tendered as exhibits “A” and “4” respectively? Certainly, if any holdback agreement existed, the same would have been accounted for in the books of the parties. Upon a perusal of the entries in the Ledger Accounts referred to, supra, the Defendant’s contention that he had a “holdback margin” agreement with the Plaintiff is not in the least probable.


On this score, the Plaintiff’s explanation that the “discount allowed” of GHC 2000.00 was passed as a result of a promotion that was run at the time is more probable. Looking at the entry that was passed, that amount reduced the Defendant’s indebtedness and so it operated more or less as a one off “cash discount”, regardless of how the Plaintiff has described it. In short, I find that on the basis of the evidence before this court, there was no 0.5% holdback margin agreement between the parties herein.



Proof of this issue rests on the Plaintiff. Its claim is based on the supplies allegedly made to the

Defendant on 24/03/2016 as stated in paragraph 4 of the statement of claim which reads:

The plaintiff avers that on 24th March 2016, the Defendant purchased on credit from its office in Kumasi Vodafone Top-Up Cards worth GHC 149,145.00.

The Defendant also averred in paragraph 8 of his statement of defence and counterclaim that:

Save that stocks were advanced to the Defendant worth GHC 149,145.00 in March, 2016, the Defendant denies paragraph 4 of the statement of claim.

Despite the above purported denial, the Defendant made the following admission in his evidence-in-chief (paragraph 12 of his witness statement):

In March 2016, I again placed an order for GHC 149,145.00 worth of Vodafone Credit Cards on our terms from the Plaintiff Company.


Indeed, the word “Advanced” used by the Defendant in his statement of defence is synonymous with words such as “loan” and “fee”, and it is therefore not surprising when he admitted in court that the products in contention were duly supplied to him in March, 2016 on the parties terms. From the evidence before this court, the Top-Up cards were supplied on credit to the Defendant, and he knew very well that the products so supplied had not been fully paid for. It is reasonable to infer that it was as a result of the Defendant’s indebtedness that he executed exhibit “F” on 12/04/2016. In the said letter, he acknowledged his indebtedness to the tune of GHC 132,648.00. The Plaintiff’s position is that after a reconciliation was done, the sum of GHC 10,740.00, representing shortages reported by the Defendant, was deducted from the outstanding GHC 143,388.00 to arrive at the sum of GHC 132,648.00 contained in exhibit “F”. The Defendant’s contention is that some payments were made subsequent to exhibit “F”. Referring to exhibit ‘5”, his counsel submitted that payments totaling GHC 17,648.00 have been made as follows: 28/04/2016-GHC 12,648.00; 15/07/2016- GHC 2000.00; 13/08/2016- GHC 2000.00 and 02/11/16-GHC 1000.00.


Given the fact that all payments made by the Defendant in favour of the Plaintiff in the course of their business transaction were done through direct transfers or deposits into the Plaintiff’s account at CAL Bank, which statement of account is before this court, the payments said to have been made by the Defendant subsequent to exhibit “F” can be verified. Even though previous payments made by the Defendants are captured on exhibit “E”, this statement of account alone will not be helpful in determining the quantum of the Defendant’s indebtedness in the sense that the entries recorded therein ended on 12/04/2016. The Ledger account, exhibit “A” will be resorted to. Upon a close look, all the post exhibit “F” payments highlighted by counsel for the Defendant can be seen in exhibit “A”. However, the GHC 12,648.00 and GHC 2000 said to have been paid on 28/04/16 and 13/08/2016 were captured as receipts on 27/04/16 and 04/08/16 respectively, That apart, the total post exhibit “F” payments is GHC 17,648.00 as at 02/11/2016, the closing balance on 02/11/2016 as per exhibit “A” is GHC 125,740.00. The plaintiff’s representative acknowledged some of these payments whilst under cross-examination on 17/10/2017 thus:

Q: From the date of appending signatures to this “Trade Terms & Conditions” till date, there has never been any transaction between you and he Defendant (25/04/2016)?

A: Then I must say that if the date he is quoting is correct, there had actually been a transaction because on 15/07/2016, Kelvin paid GHC 2000.00; on 04/08/2016, he paid GHC 2000.00, he paid GHC 2000.00. Again, on 02/11/2016, he paid GHC 1000.00.


It is to be noted that the writ of summons was issued by the plaintiff herein on 10/11/2016 wherein an amount of GHC 126,740.00 was claimed. There is no evidence before this court that subsequent to 12/04/2016 when exhibit “F” was executed, and 02/11/2016 when the Defendant made the last payment, the Plaintiff made further supplies to the Defendant. The Plaintiff’s own exhibit “A” shows the balance outstanding on the Ledger Account as at 02/11/2016, which is, GHC 125, 740.00. That GHC 125, 740.00 is the quantum of the Defendant’s indebtedness to the Plaintiff which has been proved in court, and I so find.



Under the Sale of Goods Act, 1962, Act 137, a buyer is under an obligation to pay for goods delivered to the buyer. Specific reference can be made to sections 21 and 22 as follows:

21.  Fundamental obligations of the buyer

The fundamental obligations of the buyer in a contract of sale are to pay the price and accept delivery of the goods.

22.  Payment concurrent with delivery

Unless otherwise agreed, the buyer shall be ready and willing to pay the price in exchange for delivery of the goods.


This means that upon delivery of the Vodafone Top-Up Cards to the Defendant on 24/03/2016, he was under a legal obligation to pay for the same. The Plaintiff’s inability to prove that full payment was to be made within 7 days from the date of supply does not imply that the Defendant could pay his debt at his pleasure. From the nature of the transaction between the parties as gathered from the Ledger Account, exhibit “A”, I would say that 21 days from the date of supply is a reasonable time within which the Defendant ought to have made full payment. In effect, the Defendant has denied the Plaintiff the use of its money which is still outstanding. As Denning MR put it in the case of Harbutt’s Plasticin Ltd. V. Wayne Tank & Pump co. Ltd (1970) 1 All ER 225 at 236:

The basis of an award of interest is that the defendant has kept the plaintiff out of his money; and the defendant has had the use of it himself so he ought to compensate the plaintiff accordingly.


In Akoto v. Gyamfi-Addo (2005-2006) SCGLR 1018, this reasoning was applied. On the basis of this authority, the Plaintiff is entitled to interest on the unpaid balance 21 days after the date of supply on 24/03/2016. Therefore, the interest on the GHC 125,740.00 will run from 15/04/2016.



In “McGregor on Damages”, Chapter 1, page 3, the word ‘Damages’ is defined as the pecuniary compensation obtainable by success in an action, for a wrong which is either a tort or a breach of contract, the compensation being in a lump sum, which is awarded unconditionally. Generally, “Damages” refers to the monetary compensation claimed or awarded to one who has suffered a loss or detriment. The rationale is that the successful party is entitled to full compensation for his losses on the principle of “restitutio in integrum”. These principles have been applied in cases such as Royal Dutch Airlines & Anor v. Farmers Ltd (1989-90) 2 GLR 623 at 625; and Juxon-Smith v. KLM Dutch Airlines (2005-2006) SCGLR, 438 at 442. On the evidence before this court, the failure of the Defendant to make full payment for the Vodafone Top-Up cards within a reasonable period constitutes a breach of the oral contract between the parties.


However, bearing in mind the principles for the award of damages, discussed above, the Plaintiff herein will be over compensated if general damages are awarded in addition to the compensation in the nature of interest. In the circumstance, no damages will be awarded. I turn to the Defendant’s counterclaims. These are the reliefs sought in the counterclaim:

An order against the Plaintiff to pay to the defendant outstanding holdback margin of Twenty-One Thousand One Hundred and Four Cedis and Forty pesewas (GHC 21, 104.40).

An order directing the Plaintiff to pay to the Defendant an amount of Seventy-One Thousand, Four Hundred and Fifty-One Cedis and Fifty pesewas. (GHC 71, 451.50)

Damages for breach of contract.



The law is that a counterclaimant bears the burden of proof of the claims therein. See Yormewu v. Awute (1987/88) 1 GLR 9. In the present case, the Defendant/Counterclaimant’s evidence in support of the 0.5% holdback margin falls short of the standard of proof in civil suits. In other words, that piece of evidence is not in the least convincing and has already been rejected by this court. Therefore, the claim for GHC 21, 104.40 based on the 0.5% holdback margin cannot be granted.


Similarly, the Defendant has not introduced any evidence at all with regards to his counterclaim for GHC 71, 451.50. That counterclaim also fails for lack of evidence. The last but not the least is the counterclaim for damages. The question to be asked is- what detriment, be it financial or otherwise, has the Defendant suffered by virtue of the oral agreement between the parties that has culminated in this suit? Is the Defendant not making a mockery of himself by asking to be awarded damages for breach of contract? As far as the oral agreement between the parties is concerned, the Defendant who failed to make full payments thereunder has been found to be in breach of that agreement. The “Trade Terms & Conditions Revised” agreement was made between the Plaintiff herein and Chafal Company Limited. As rightly argued by counsel for the Plaintiff, this document cannot have retrospective effect. If there is any breach at all arising from that agreement, exhibit 6, the proper person to sue is Chafal Company Limited and not its Director, because the company is capable of handling its own affairs. The case of Soonboon Seo v. Gateway Worship Centre (2009) SCGLR 278 readily comes to mind.


The court was confronted with issues bothering on the separate legal existence of incorporated companies and its capacity to sue. The reasoning therein will be applicable here even though the facts are very different. In holding (4) thereof, the court stated:

It is clear from the record of appeal, that the second-Plaintiff Church is a Company limited by guarantee and incorporated under the Companies Act, 1963 (Act 179). As a result, pursuant to section 24 of the Companies Act, 1963, it has all the powers of a natural person of full capacity. As such, it is a fully- fledged legal entity, with a personality separate from the natural persons forming it, and with capacity to sue and be sued in its own name. In law, members of a Company have no direct proprietary rights over its assets, the Company being the sole owner of its assets. Since it is patent from the record that the subject matter of the action was being claimed as the church’s asset rather than the joint property of the church and the first Plaintiff, there was no reason why the first Plaintiff should have been included as a co-claimant. From the record, the first Plaintiff really has no business in the suit, since he does not make any claim of interest in the subject-matter of the suit. The second Plaintiff church is capable of handling its own litigation and the first Plaintiff is an unnecessary party. Consequently, the first Plaintiff would be struck out as a party …” emphasis added.


From the foregoing, the court concludes that the Defendant has not in any way met the criteria for the award of damages. Accordingly, his claim for damages fail. Judgment is entered against the defendant in favour of the Plaintiff in the sum of GHC 125, 740.00 and interest thereon at the prevailing Commercial Bank rate and at simple interest from 16/04/2016 to the date of judgment; and post judgment interest at the same rate till date of final payment. The Court has reviewed the provisions of order 74 of C.I. 47 on the award of cost and has also considered the submissions of counsel herein. Cost of GHC 15,000.00 is awarded against the defendant in favour of the Plaintiff.