IN THE SUPERIOR COURT OF JUDICATURE
IN THE HIGH COURT (COMMERCIAL DIVISION)
ACCRA - A.D 2018
THE ROYAL LIMITED - (Plaintiff)
UNITED STEEL AND TRADING CO. LTD AND 2 OTHERS - (Defendants)
DATE: 28 TH JUNE, 2018
SUIT NO: CM/BFS/0866/2016
JUDGES: ERIC K. BAFFOUR, ESQ. JUSTICE OF THE HIGH COURT
PLAINTIFF REPRESENTED BY JANET TETTEH WAYO. COUNSEL FOR PLAINTIFF – DERRICK DELALI
KUSHITOR COUNSEL FOR DEFENDANTS – DAVID KUDOADZI
Plaintiff claims the following reliefs endorsed on its writ issued against the defendant:
a) Recovery of the sum of Thirty-Four Million, Three Hundred and Seventy-One Thousand, One Hundred and Eighty–Nine Ghana Cedis and Twenty-Nine Pesewas Gh¢34,371,189.29
b) Recovery of interest on the said sum, at the contractual default compound interest rate of 42.5% per annum accruing from day to day and compounded monthly till date of final payment
c) Cost including legal fees on a full indemnity basis
d) Such further order(s) as the court may deem fit.
The factual basis for the claim of the Plaintiff can be summarized as follows: That Defendant by a board resolution resolved to request banking credit facility from the Plaintiff Bank. And by a deferred letter of credit Plaintiff granted an amount of USD$7,330,000.00 to the 1st Defendant institution for which 2nd and 3rd Defendants being directors of the 1st Defendant gave personal guarantees among other securities for the due repayment of the monies. The facility granted included a short term loan in the sum of USD$3,665,000 whose purpose was to increase available funds for the payment of deferred letters of credit from USD$2,120,000 to USD$3,665,000. Plaintiff further aver that the interest rate was 32.5% per annum for twelve months with each draw down payable within 60 days payable from the proceeds of the business of the 1st Defendant. That the loans were secured with securities including a first ranking charge over fixed and floating assets of factory equipment at Tema Free Zone enclave, a deed of assignment of receivables, joint and several guarantees executed by 2nd and 3rd Defendants.
To Plaintiff, there has been an accrual of debt and as at August, 2016, Defendant was indebted to the Plaintiff in the sum of GH¢34,371,189.29 and that interest on the amount continue to accrue at the compound rate of 42.4%. Plaintiff contend that despite persistent demands on Defendant to repay the loan, he has failed to do so and hence the prayers to the court to compel Defendant to repay the loans. Defendants on the other hand in their statement of defence makes an admission of the essential admission of the loan granted by Plaintiff but contend that the 10% interest rate charged by Plaintiff is harsh, unconscionable and unacceptable to the Defendants. They further contend that in 2016 it had serious operational challenges due to electricity power outages and a fire outbreak in its factory. For which Defendant approached Plaintiff to discuss the issues and suggested an extension of time for the repayment for which Plaintiff agreed.
And that per the agreed terms agreed upon, the repayment was not due and hence Plaintiff was not entitled to its claim. With the pretrial conference unable to achieve settlement between the parties the following issues were set down for determination;
a) Whether or not the 10% default compound rate charged by the Plaintiff on the balance owed and due on the principal and interest is unconscionable
b) Whether or not Plaintiff is entitled to its claim
c) Any other issue(s) as arising from the pleadings.
The court ordered the parties in line with Rule 7A of Order 32 of the High Court (Civil Procedure) Rules, C. I. 47 as inserted by C.I. 87 to file witness statements as well as copies of all the documents they intended to rely on at the trial when the suit was ripe for trial. Parties after some delays complied with the order and a case management conference was held even though Defendant failed to attend the conference notwithstanding due notice served on its Solicitors.
During trial as Plaintiff testified through its representative and tendered the witness statement of Thomas Kadi as his evidence in chief. The following were admitted on behalf of Plaintiff as exhibits:
Extracts of the minutes of the board meeting of defendant as Ex ‘A’
The facility offer letter as Ex ‘B’
A fist ranking debenture document as Ex ‘C’
A deed of assignment of receivables as Ex ‘D’
A joint and several guarantee of directors of Defendant as Ex ‘E’
A demand notice as Ex ‘F’
An account statement as Ex ‘J’ as among some of the crucial documents tendered by Plaintiff’s representative as exhibits.
As Defendant’s representative failed to appear before the court to testify, the witness statement admitted during case management conference cannot be said to be evidence as they have not been tendered in the witness box. As matters stand, Defendant failed to appear for the trial. The witness statement of Hani Mikat and the document admitted on behalf of the Defendant during case management conference was expunged from the records as they are considered as evidence only when a witness has been taken an oath or affirmation in the witness box and tendered them. The evidence of Thomas Kadi in the box stood unchallenged neither was there any cross examination to traverse the evidence and the exhibited he tendered of the claim of Plaintiff to the liquidated amount of Gh¢34,371,189.29 together with the interest that it is claiming in this court. Defendant and his Counsel notwithstanding hearing notices failed to appear for the trial.
It is trite that the failure by a party to cross examine a witness on vital matters testified to in the witness box would be deemed to be an admission of those matters and a party need not call further evidence on that. See the following cases: FOLI v AYIREBI  GLR 627; BILLA v SALIFU  2 GLR 87; BEDIAKO v THE STATE  1 GLR 48; LANQUAYE v THE REPUBLIC  1 GLR 1; TAKORADI FLOUR MILL v SAMIR [2005- 2006] SCGLR 882; BANDA v REPUBLIC  1 GLR
The defendant was offered ample opportunity to be present in court and yet choose not to participate in the proceedings.
I therefore find and hold that plaintiff has made out its claim to be entitled to the monies it seeks per the endorsement on the writ and I proceed to enter judgment for plaintiff for:
a. Recovery of the sum of Thirty Four Million Three Hundred and Seventy One Thousand, One Hundred and Eighty-Nine Ghana Cedis and Twenty-Nine Pesewas (GH¢34,371,189.29)
b. Interest on the said sum at the contractual default compound interest rate of 42.5% per annum accruing from day to day and compounded monthly till date of final payment.
I assess the cost of the Plaintiff at 7% of the principal amount granted Plaintiff under relief (a).