M. BASHIRU LIVINGMAN ELECTRICAL COMPANY LIMITED vs. BEROCK VENTURES LIMITED
  • IN THE SUPERIOR COURT OF JUDICATURE
    IN THE HIGH COURT(COMMERCIAL DIVISION)
    ACCRA - A.D 2016
M. BASHIRU LIVINGMAN ELECTRICAL COMPANY LIMITED - (Plaintiff)
BEROCK VENTURES LIMITED - (Defendant)

DATE:  22ND APRIL, 2016
SUIT NO:  OCC/04/2012
JUDGES:  SAMUEL K. A. ASIEDU, JUSTICE OF THE HIGH COURT
LAWYERS:  MR. FRANCIS KWAME YEBOAH FOR THE PLAINTIFF
MR. PETER OKUDZETO FOR THE DEFENDANT
JUDGMENT

By a writ issued on the 16th January, 2012 the plaintiff claims against the defendant:

a. An order for an audited final account of the contract.

b. An order for the assessment of profit accruing to the joint venture

c. An order for the payment of 30% of such profit by the defendant to the plaintiff

d. Interest on the plaintiff’s share of profit at the current interest rate from the 8th August, 2011 to date of final payment.

e. Any other relief deemed fit by this Honourable Court.

 

The defendant entered appearance to the writ after service of the writ and its accompanying statement of claim. A Reply was thereafter served by the plaintiff and after the failure of pre-trial settlement, the case was set down for hearing at which the plaintiff gave evidence through its representative, Mohammed Bashiru, the managing director of the plaintiff company and closed its case. The defendant also testified per its representative, Samuel Etornam Kornu, and then announced the closure of the defendant’s case. Before the parties could give evidence however, an application was made for the appointment of an Auditor to audit the books of the joint venture and report to the court. The court, subsequently, appointed Ernst & Young, Chartered Accountants on the strength of section 114 (1) of the Evidence Act 1975, NRCD 323. The auditors then audited the books of the joint ventureship and presented a report which was admitted in evidence as exhibit CE1.

 

From the pleadings of the parties the court finds as a fact that the following matters are not in issue or dispute in view of admissions made by the defendant in its statement of defence:

 

That the plaintiff and the defendant are both limited liability companies registered under the laws of Ghana and that the plaintiff’s offices are located in Tamale whiles the defendant’s offices are located in Accra.

 

That in or about January 2010 the plaintiff was contacted by the defendant concerning a project on tender from the Millennium Development Authority (MiDA) for the construction of Rural Electrification Infrastructure in the Northern Intervention Zone.

 

That after discussion in March 2010 the parties formed a joint venture known as Berock Bashiru Joint Venture for the tendering of the said project. Indeed at the trial, the joint venture agreement between the parties was admitted in evidence as exhibit 1A

 

That the joint venture submitted a bid or tender for the project. That the project was eventually awarded to the joint venture to execute the Rural Electrification Infrastructure in the Northern Intervention Zone designated as contract No. 3202205/10 by the Millennium Development Authority (MiDA) in or about July, 2010.

 

It is also admitted by the defendant that initially the agreement was that the defendant would take care of most of the management issues within the joint venture and the plaintiff would do the actual construction which involved the construction of transmission lines and substations.

 

The defendant does not dispute the fact that during the course of the project there were so many disagreements between the parties which finally led to arbitration culminating in an arbitration report. The said arbitration report was received in evidence as exhibit D.

 

In the opinion of the court given the submissions made on behalf of the parties and the subsequent order made on the 31st March, 2014 for the appointment of an Auditor to audit the accounts of the joint venture as a result of which an audited account had been made available to the court as shown by exhibit CE1 herein, the first and second reliefs endorsed on the plaintiff’s writ for “an order for an audited final account of the contract and also for an order for the assessment of the profit accruing to the joint venture” have thereby become spent and unworthy of any further consideration. The court will therefore concentrate on the main issues or dispute between the parties.

 

In its amended statement of claim, the plaintiff had pleaded at paragraphs 10a, 11 and 14 that the accounts of the joint venture was expected to be prepared in dollars and not in cedis. As a result of this allegation the plaintiff had endorsed on the amended statement of claim, as one of the reliefs it seeks from the court “an order for the account to be designated in dollars”. This allegation has been denied by the defendant company in its statement of defence. It therefore became the duty of the plaintiff to lead cogent evidence to establish this claim as stipulated under sections 11(1), 14 and 17 of the Evidence Act 1975 NRCD 323.

 

In  Ababio vs. Akwasi III [1994-1995] GBR 774 the court pointed out that:

 

“A party whose pleading raised an issue essential to the success of the case assumed the burden of proving such issue. The burden only shifted to the [other party] when [such a party] had adduced evidence to establish the claim”

 

The plaintiff gave evidence to the effect that the accounts of the joint venture as well as the profit of the joint venture should all be designated and assessed in dollars. The plaintiff makes this demand, according to the representative, on the basis that the contract was awarded in and paid for in dollars and that the major materials used in executing the contract was purchased and paid for in dollars. The plaintiff also drew attention to the fact that the arbitrator’s award was in dollars. The evidence of the defendant’s representative on this issue is that it is not all the purchases of materials that was paid for in dollars and that even before the joint venture received mobilization funds from the Millennium Development Authority (MiDA), the defendant had sourced funds in Ghana Cedis, converted same into dollars and used it to buy or order for materials from outside the country. The defendant’s representative testified to the effect that some of the materials for the project were locally acquired and paid for in local currency. According to the defendant the labour used for the project was also paid for in local currency. This piece of evidence adduced by the defendant’s representative in respect of purchases being made both in dollars and in cedis was not challenged by the plaintiff.

 

As far as the currency in which the account was prepared and or ought to have been prepared is concerned, the Court Witness also testified in answer to questions put to him under cross examination as shown hereunder

“Q. I am putting it to you that it was most unfair to have used cedis translated all the dollars into cedis into this account?

A. My lord an account is based on assumptions and we clearly indicated the assumptions under which this account is prepared. So you need to read the accounts in the context in which it was prepared. If you look at page 12 1.2, we have indicated that the functional currency of the joint venture is Ghana cedis. Transactions denominated in foreign currencies are translated into Ghana cedis and recorded at the exchange rate ruling from the date of that transaction. So you need to read the account in that context to be able to appreciate that.

Q. I am putting it to you that when you said the functional currency of the joint venture is Ghana cedis that will be completely wrong because all payments were made in dollars?

A. The functional currency is not driven by the payment, it is driven by what the firm or the book keeper has agreed to use.

Q. Did you check with the plaintiff that the currency under which it was agreed that the accounts should be prepared was the cedi?

A. No I did not check because it was not the responsibility of that party to prepare the accounts.

Q. So what you want to tell this court is that if the defendant even used the wrong currency, you as an auditor will automatically follow it. That is what you are trying to tell the court?

A. No that is not what I am trying to tell the court.

Q. Is it not true that you as an auditor if you found the currency been used not fair, you will decide to use a currency which is fair to both parties?

A. Yes my lord but I think the legal tender in Ghana is the cedi. And it is appropriate that when you are reporting in Ghana, you report in cedis.

Q. So that you as an auditor, even if you know that using cedis will not be fair to one party, you will still go ahead and use it. Is that what you want to tell this court?

A. My lord it is not an issue of fairness because the time that this profit is to be shared is not determined. If we use a rate that is not the rate that will be used at the time that the profit might be shared, if you decide to share it in dollars, so the rate changes every time. We cannot be changing or reporting every time the rate changes, so we have to prepare in the currency that is acceptable to everybody. If you meet to decide to change it, you can decide to use the rate at the date you are making your finance or transaction.

Q. If you had used dollar which was the currency in which all payments were made and in which all major purchases were made, will that not be fair, you would not have to go and do any exchange. Is that not so?

A. It’s not so because the books were kept in cedis, you are confusing the bank statement and the books of account. We audited the books of accounts which are kept in cedis not in dollars.

Q. I am putting it to you that in the circumstances of this particular case, the currency that you should have used in your account was the dollar?

A. No my lord because the books were kept in cedis.”

 

Thus, from the evidence on record, the court finds that it is not correct for one to say that the materials used in the execution of the project by the joint venture were all purchased and paid for in dollars. What is apparent from the evidence is that some of the materials were purchased and paid for in dollars and some in Ghana Cedis. The labour cost for instance was paid for in Ghana Cedis. The parties to the joint venture are all Ghanaian companies and the contract, subject of the joint venture, was executed in Ghana. It is true that the contract sum was paid in dollars but equally true is the fact that at a point in time Ghana Cedis was procured, converted into dollars which was used to buy materials abroad just as materials, locally procured, were paid for in Ghana Cedis.

 

It is clear from the Joint Venture Agreement exhibit 1A as well as the Draft Memorandum of Understanding exhibit 1 herein that the administrative matters including the preparation of the books of account were all assigned to the defendant to handle on behalf of the joint venture. However, the Joint Venture Agreement and the Memorandum of Understanding did not spell out the currency in which the accounts of the joint venture shall be kept.

 

The functional currency of the Republic of Ghana is currently the Ghana Cedis. Indeed, section 41 of the Bank of Ghana Act, 2002, Act 612 makes the currency and notes issued by the Bank of Ghana the legal tender in Ghana and that being so, where a company or a business entity transacted business in Ghana and prepares its account in the Ghana Cedis, which is the official currency of Ghana, that business entity cannot be said to have acted in breach of any law.

 

In the instant matter, as already pointed out, there is no provision in the joint venture agreement or the memorandum of understanding governing the relationship between the parties which enjoins the defendant to prepare the accounts of the joint venture in dollars and the fact that major purchases were made and paid for in dollars is no reason in itself to compel the preparation of the accounts of the joint venture in dollars.

 

At any rate, as explained by the defendant, the preparation of the account in dollars will add no special value to the accounts and neither will it affect the fortunes of any of the parties to the joint venture since the stated figures can easily be converted into whatever currency one desires by the application of the correct exchange rate. The court will hold, as a result, that the plaintiff is not entitled to the reliefs for an order for the preparation of the accounts of the joint venture in dollars and the denomination of the profit of the joint venture in dollars. Accordingly, those reliefs are dismissed.

 

From the pleadings the court notes that the main issue for determination is whether or not the plaintiff herein is entitled to and should be paid 30% of the profit from the audited accounts together with interest thereon at the current bank rate up to the date of final payment.

 

The plaintiff has pleaded in its statement of claim that the profit of the joint venture is supposed to be shared at the rate of 70% to the defendant and 30% to the plaintiff and that at any rate the plaintiff’s share of profit should not be less than $39,500. This averment contained in paragraph 11 of the statement of defence is denied in part by the defendant.

 

From the pleadings and the evidence on record, the court finds that the relationship between the plaintiff and the defendant was governed by a Joint Venture Agreement exhibit 1A herein as well as a Memorandum of Understanding exhibit 1 herein. Later, the parties proceeded to arbitration to have their differences resolved as a result of which an arbitration report was produced and received in evidence as exhibit “D”. A critical consideration of the evidence before the court will reveal that these three exhibits; that is: exhibit 1, exhibit 1A and exhibit “D” sum up the rights and obligations of the parties to the joint venture. This fact is admitted by the parties in their evidence before the court. In Marks vs. Whiteley [1912] 1 Ch. 735, it was held that

 

“Where several deeds form part of one transaction and are contemporaneously executed they have the same effect for all purposes such as are relevant to this case as if they were one deed. Each is executed on the faith of all the others being executed also and is intended to speak only as part of the one transaction, and if one is seeking to make equities apply to the parties they must be equities arising out of the transaction as a whole.”

 

The plaintiff tried to assert that exhibit C tendered by it is also one of the documents governing the relationship between the parties but the court after examining exhibit C finds that the said exhibit is a letter written by the defendant in response to certain demands made by the plaintiff and that generally speaking exhibit C cannot be one of the documents that governed the relationship between the parties.

 

The main purpose of the joint venture is captured in the joint venture agreement as follows:

 

“This Agreement is entered by First Joint Venture and Second Joint Venture, hereinafter collectively referred to as the “BEROCK-BASHIRU Joint Venture”, for the purpose of Bidding and performing Electrical Installation works in the Northern Zone under MCA Ghana.”

 

The arbitrator also recognised the purpose of the formation of the joint venture when he stated at page 1 of exhibit D that it was “for the purpose of bidding and performing electrical installation works in the Northern zone under MCA Ghana.” It therefore ought to be placed on record that the joint venture between the plaintiff and the defendant companies had a dual purpose. The first was to bid for the contract to install electrical lines in the Northern zone and the second was to actually perform the contract by installing electrical lines in the Northern zone.

 

In order to achieve the purpose of the joint venture, the joint venture agreement, exhibit 1A, as well as the memorandum of understanding, exhibit 1, set out certain obligations to be met by the parties which will enable them to enjoy certain rights under the contract. The obligations which the parties imposed upon themselves under the agreement are captured under the heading percentage of participation as follows:

 

Description

Except as otherwise provided in hereof, the interest of Parties in any gross profits and their respective shares in any losses and/or liabilities that may result from the filing of a joint bid and/or the performance of the Contract, and their interests in property and equipment acquired and all money received in connection with the performance of the Contract shall be as follows:

 

BEROCK VENTURES LIMITED to provide: 70% of all resources required for the bidding and execution of each contract.

 

M. BASHIRU LIVING CO. LTD: 30% of all resources required for the bidding and execution of each contract.”

 

Again the parties agreed to delegate authority between them as follows:

 

“Delegation of Authority

 

Split of Authority

 

The Ventures agree to split of authority themselves as follows;

Delegation of Authority                      

Contract Management            -           Berock Ventures Limited

Physical Site Works                -           M. Bashiru Livingman

                                                            Electrical Company Limited”

 

In consequence of the above the parties agreed in the memorandum of agreement exhibit 1 herein to pool resources together and particularly for the plaintiff to “provide the Technical expertise that is field works personnel and equipment” and for the defendant to provide “project management expertise including administrative and financial management” as well as “lead the association as the team leader”.

 

Consequently, the parties agreed that “upon the execution of the agreement, the venture shall each own 70% for Berock and 30% for Bashiru interest in the venture” and that “Berock Venture Limited share of profit or loss is 70% whiles M. Bashiru Livingman Electrical Company Limited’s share of profit or loss is 30%.”

 

From the various clauses in the agreement as well as the memorandum of understanding between the parties, the court finds that the enjoyment of the profit share by the parties is inextricably linked to each party performing its obligations under the agreement and the memorandum of understanding. This, no doubt, is the case because it is the performance of their obligations for a successful bid of the contract and the execution of the contract from MiDA that may rake in the profit to be shared.

 

Without performing their obligations under their own agreement the venture may not win the contract; and they may not be paid under it and no question will arise in respect of sharing any profit thereunder. The plaintiff admitted to this in cross examination on the 22nd of October 2015. Hence, one cannot look at the profit share without looking at the obligations required to bring in the profit. For, the law is that in ascertaining the intention of the parties to a document the document must be read and interpreted as a whole. Thus, in Chamber Colliery Ltd vs. Twyerould [1915] 1 Ch. 268 the court held that

 

“I find nothing in this case to oust the application of the well-known rule that a deed ought to be read as a whole, in order to ascertain the true meaning of its several clauses; and that the words of each clause should be so interpreted as to bring them into harmony with the other provisions of the deed, if that interpretation does no violence to the meaning of which they are naturally susceptible.”

 

And in Boateng vs. Volta Aluminium Co. Ltd [1984-1986] 1 GLR 733, the Court of Appeal pointed out that

 

 “In attempting to construe the termination provisions, regard should be had to all the four clauses, i.e. the language used and all the provisions in the termination clauses should be looked at as a whole and every clause must be compared with the other and one entire sense made out of them. It was only by so doing that the true meaning and the intention of the parties could be discovered.”

 

The case of the plaintiff is that it is entitled to 30% of the profit accruing to the joint venture and that the defendant should be compelled to pay to the plaintiff the said 30% of the profit. The question then arises whether or not the plaintiff had discharged the obligation which the joint ventureship had imposed upon it to entitle it to the 30% profit share as agreed upon.

 

The purpose of the joint venture was of a dual nature. As already pointed out, it was first to bid for the contract of Electrical Installation Works in the Northern Zone under MCA Ghana and secondly, to perform the contract of Electrical Installation Works in the Northern Zone under MCA Ghana. In each of the two stages stated above, the parties to the joint venture were given specific obligations to perform. In the joint venture agreement exhibit 1A herein, Berock Ventures Limited was tasked “to provide 70% of all resources required for the bidding and execution of each contract.” In the same manner the plaintiff M. Bashiru Livingman Electrical Co. Ltd was tasked “to provide 30% of all resources required for the bidding and execution of each contract.” Again the same exhibit 1A also placed the overall management of the contract in the hands of the defendant company and also placed the execution of the physical site works in the hands of the plaintiff company.

 

This is almost repeated in the memorandum of understanding exhibit 1 herein where it is stated under the heading EXECUTION at page 2 thereof that “Bashiru provides the Technical expertise i.e. Field Works Personnel and Equipment” whiles the defendant “provides Project Management Expertise including Administrative and Financial Management” and that the defendant “will lead the Association as Lead Contractor”

 

The plaintiff admitted under cross examination on the 22nd October, 2015 that among the obligations assigned to it, under the joint venture, was a duty to carry out the physical works. The plaintiff asserted that indeed it carried out the physical works. The plaintiff stated that it “used a bulldozer to clear the line route of the transmission lines for the drawing of the line” The plaintiff’s representative said that he used his personal vehicle to transport diesel to the bulldozer in the bush. According to the plaintiff’s representative, he later requested that the entire physical works should be awarded to the plaintiff at a profit-free contract for GH230,000 but the defendant thought that figure to be expensive hence the job for the physical works was awarded to six subcontractors at a fee of GH120,000. The plaintiff later admitted, under cross examination, that the physical works was awarded to six contractors and that the plaintiff then played a supervisory role and also attended site meetings.

 

The allegations by the plaintiff of carrying out the physical works by hiring a bulldozer to clear the lines, of attending site meetings and also of supervising the physical works after it had been contracted out to subcontractors have been denied and challenged by the defendants.

 

The court finds from the evidence on record that the plaintiff performed his obligations under the joint venture at the pre-bid stage which led to the successful tender for the contract from MiDA. The defendant made admissions to this effect when he answered the following questions put to its representative as follows:

“Q The part that the plaintiff was expected to play in the tendering, plaintiff accordingly did that. Is that not so

A. Yes my lord

Q. So that when we come to the stage of tendering the plaintiff did not default in any way. Is that not so

A. Yes my lord because at that stage there was not much expected of him.

Q. Was he not expected to provide inputs which were worth 30% and the defendant providing inputs worth 70% as stated in the agreement?

A. No this is because there is a caveat in the agreement which said that at the tender stage Berock will absorb some of his responsibilities but will take care of that when we get to the execution stage”

 

It follows that the defendant’s assertion to the non-performance of the plaintiff of its obligations is an assertion as to the non-performance of the plaintiff’s obligations at the execution of the contract. The obligation in respect of the performance of the physical works at the contract site. The defendant also complained that the plaintiff failed to make the 30% financial contribution towards the execution of the contract. The plaintiff admitted under cross examination that it failed to make the 30% financial contribution. This admission was made on the 22nd October, 2015.

 

Counsel for the plaintiff has strenuously tried to show in his addresses that the procurement of the advance mobilization funds was done by the defendant with the use of the expected funds from the contract. This is against the backdrop of the plaintiff’s clear admission during cross examination that the advance mobilization together with other bonds posted on behalf of the joint venture were procured by the defendant alone without any input from the plaintiff as required by the agreement of the parties. The defendant has explained to the satisfaction of the court that the funds which it procured from its bankers before the inflow of mobilization funds from MiDA were secured with guarantees from its insurers and this is supported by exhibits M, N, N1,P and P1.

 

The arbitrator also found as a fact when he stated at page 4 of the report exhibit D that “Bashiru has failed to provide the 30% required under clause 4 of the JV Agreement and therefore loses his interest of 30% in the contract”. Again the arbitrator observed at page 8 of exhibit D that “M. Bashiru Ltd apart from the technical expertise and documentation at the bidding stage has not made any financial contribution to date.” The arbitrator then pronounced as part of his award that “M. Bashiru Ltd should be given 21 days to pay-up the 30% expenditure (i.e. total inputs to date less mobilization advance paid) to enable them enjoy the full benefits under the joint venture agreement.” The defendant had testified that up to date the plaintiff has not paid up the required 30% as ordered by the arbitrator.

 

It has been submitted on behalf of the plaintiff that the allegation in respect of the non-performance of his obligations under the contract was made by the defendant and therefore it is the duty of the defendant to prove that assertion. Counsel put it thus; in his address filed on the 23rd March 2016:

 

“in his evidence in chief the plaintiff was emphatic that the plaintiff never defaulted in any way in the responsibility placed on the plaintiff. The allegation was made by the defendant and therefore by section 10 and 11 of the Evidence Law (NRCD 323) the onus of persuasion falls on the defendant.”

 

Counsel then quoted section11 (1) of the Evidence Act and then submitted further that

 

“the issue here is whether or not the plaintiff defaulted in responsibility of the plaintiff. All that the defendant has said in his evidence quoted above earlier in connection with the issue is that: ‘it is because he did not fulfill the responsibilities that would entitle him to that 30%. No more’”

 

A critical review of paragraph 13(b) of the amended statement of defence will reveal that the defendant’s plea of non-performance by the plaintiff of the plaintiff’s obligations under the contract is a plea in the negative, whereas the plaintiff’s answer to same is a plea in the positive. That is, whereas the plaintiff in essence was alleging that he discharged his obligations under the contract and so he is entitled to 30% share of the profit as agreed, the defendant was saying in essence that the plaintiff did not discharge his obligations under the contract and therefore the plaintiff is not entitled to reap the 30% share of profit.

 

That being so, it is not a correct statement of the position of the law that the burden of producing evidence on the issue of performance is on the defendant. It is rather, in the opinion of the court, the duty of the plaintiff to adduce persuasive evidence to establish his claim that he, indeed, duly discharged his obligations under the joint venture agreement. This is because it is the plaintiff who asserts that it had duly discharged its obligations. The law has always been that it is the positive that is always proved and not the negative. See Bank of West Africa Ltd vs. Ackun [1963] 1 GLR 176 where the court stated that

 

“The onus of proof in civil cases depends upon the pleadings. The party who in his pleadings raises an issue essential to the success of his case assumes the burden of proof.”

 

In respect of the physical works, as already pointed out, the plaintiff’s assertion to hiring bulldozer to clear the lines and fuelling the bulldozer with his personal car and also of supervising the works have been challenged by the defendant. The law is clear that where a party is required to give evidence in order to secure a favourable finding thereon he does so by leading cogent evidence on the issue. Sections 14 and 17 of the Evidence Act 1975 NRCD 323 is apt on this point. The sections provide that:

“14. Allocation of burden of persuasion

Except as otherwise provided by law, unless it is shifted a party has the burden of persuasion as to each fact the existence or non-existence of which is essential to the claim or defence that party is asserting.

 

17. Allocation of burden of producing evidence

Except as otherwise provided by law,

(a) The burden of producing evidence of a particular fact is on the party against whom a finding on that fact would be required in the absence of further proof;

(b) The burden of producing evidence of a particular fact is initially on the party with the burden of persuasion as to that fact.”

 

The court has also explained in the recent case of Okudzeto Ablakwa (No. 2) vs. Attorney General & Another [2012] 2 SCGLR 845 at 867 that

 

“If a person goes to court to make an allegation, the onus is on him to lead evidence to prove that allegation, unless the allegation is admitted. If he fails to do that, the ruling on that allegation will go against him. Stated more explicitly, a party cannot win a case in court if the case is based on an allegation which he fails to prove or establish. This rule is further buttressed by section 17 (b) which, emphasizes on the party on whom lies the duty to start leading evidence…”

 

Before this court it has been established that the agreement between the parties herein required that the plaintiff provides 30% of all resources needed to bid for the contract from MiDA as well as 30% of all resources needed to execute the said contract after the bid had been won and the contract actually given to the joint venture to perform. It has also been established that to a large extent the plaintiff performed its obligations under the joint venture agreement and the memorandum of understanding up to the bidding stage where the contract was won except that the plaintiff made no financial contribution even at the bidding stage or at all. It has also been established that the plaintiff failed to perform its obligation of providing 30% of all resources needed to execute the contract after it had been won from MiDA. And even up to date the plaintiff has not provided the 30% resources as required.

 

The plaintiff says that during the execution stage of the contract, it performed its obligation of carrying out the physical works by hiring a bulldozer to clear the bush where the electrical lines will pass and by using the personal vehicle of the plaintiff’s representative to transport fuel to the bulldozer and also by supervising the works.

 

The plaintiff has admitted that the actual physical work of laying or fixing the electrical lines was sub-contracted to six contractors who did that work. It must be stressed that the fixing or the laying of the electrical lines was the key obligation allocated or imposed upon the plaintiff by the agreement and the memorandum of understanding exhibits 1A and 1 herein.

 

The plaintiff’s assertions that it hired a bulldozer to clear the bush and also that it attended site meetings and also that it supervised the works have been strongly denied by the defendant. In the opinion of the court, an allegation of hiring a bulldozer is one that could be positively proved by tendering the receipt of payment for the hire. Again the labourers who were present when the bulldozer was sent to the site or the driver of the bulldozer could be invited to corroborate the evidence of the plaintiff. Moreover, evidence that one attended site meetings could be proved by producing and tendering the record of the meetings in evidence. The plaintiff even stated that its representative sent emails after attending the site meeting in which certain recommendations were made to the team leader. Such emails could have been tendered in evidence to prove the alleged attendance at the meeting. Again the plaintiff could have tendered the receipts issued to it when it bought the fuel for the bulldozer. As pointed out, these are matters that could positively be proved by tendering the relevant documents in support thereof.

 

In the opinion of this court, to the extent that the issue under discussion is one that is capable of some positive proof as shown above, the failure of the plaintiff to offer any such proof is fatal to its success on this issue and consequently the court holds that the plaintiff has failed in proving that the plaintiff discharged or performed the obligation of carrying out the physical works as provided under the contract. See Majolagbe vs. Larbi [1959] GLR 190; Zabrama vs. Segbedzi [1991] 2 GLR 221.

 

Indeed, the enjoyment of the 30% of the profit of the joint venture hinged directly on the provision by the plaintiff of 30% of all resources needed to execute the contract and also on the plaintiff’s performance of its other obligations under the contract including the performance of the physical works required under the contract. The arbitrator clearly alluded to this fact when he observed at page 8 of the report exhibit D that

 

“Going by the principle of NOTHING VENTURED, NOTHING GAINED, the J.V. AGREEMENT under Clause 4 [Percentage Participation] clearly gives the conditions under which either party can partake in any GROSS PROFITS in the performance of the Contract, and their interests in property and equipment acquired and all money received in connection with the performance of the Contract shall be CONTINGENT upon the PROVISION OF THE STATED PERCENTAGE of all resources required for the BIDDING and EXECUTION OF EACH CONTRACT.”

 

Consequently, the arbitrator advised the parties that

 

“If, however, M. BASHIRU LTD is unable to pay-up THE 30% due, then BEROCK VENTURES should revert to their earlier proposal to award the Physical Works to M. BASHIRU LTD at a Negotiated Price. The proposal is akin to M.BASHIRU LTD’s own proposal as captured in 4.1.5[4].

 

Considering the fact that TIME IS RUNNING OUT on the Contract, BEROCK VENTURES LTD may execute the entire works to their best endeavours”

 

There is evidence that the plaintiff has up to date not fulfilled his part of the contract. It means therefore that the plaintiff is not entitled to enjoy the 30% profit stipulated under the contract. This does not mean, however, that the plaintiff is entitled to nothing. This is so because there is evidence that the plaintiff, at least, discharged his obligation up to the bidding stage. It implies that the plaintiff is entitled to be rewarded for the work done by it up to the pre-contract or the bidding stage because the evidence on record shows that immediately after winning the bid, there arose a dispute between the parties and hence the implementation stage of the contract was fraught with dispute which ended up in arbitration leading to the report made in exhibit “D” wherein the plaintiff was ordered to pay and or provide to the joint venture his 30% contribution of resources needed for the execution of the contract but he failed to so provide. Nevertheless, once the plaintiff made contribution to the joint venture at the bidding stage it is entitled to be rewarded accordingly. In order words the plaintiff is entitled to be rewarded on the basis of quantum meruit.

 

In Craven Ellis vs. Canons Ltd [1936] 2 All ER 1066, the court held that

 

“The basis of the doctrine of quantum meruit is carefully considered. The right to proceed with a claim for quantum meruit does not arise out of the original contract, nor is it an inference of fact based on the acceptance of services or goods based on what was thought to be a binding contract. The true basis of the claim is an inference of law where work has been done or goods supplied under what purports to be a binding contract but is not so in fact.”

 

And in Mabsout v. Fara Brothers (Ghana) Ltd. [1964] GLR 437, the court relying on the case of Craven-Ellis v. Canons, Ltd (supra) held that

 

“The acceptance by the respondents of the services rendered by the appellant at the request of the respondents raised a presumption in law of a promise to pay on a quantum meruit basis for the services rendered”.

 

Again in Kobaku Associates vs. Owusu [2003-2005] 1 GLR 61, the Court of Appeal pointed out that

 

“The existence of a contract was not a sine qua non for remuneration on quantum meruit. Where from the surrounding facts a promise to pay should be implied irrespective of the intention of the parties at the time when the work was done or the service was rendered, the court would imply that the recipient of the service would pay a reasonable sum. What was a reasonable amount was a question of fact. And although the professional scale of fees might be taken into account, an award was made taking into account the value and quality of work actually done, the time spent and the experience of the party.”

 

The court also held in Skanska Jensen International v Klimatechnik Engineering Ltd [2003-2005] 1 GLR 356 that

 

“The law provides two bases for determining the value of quantum (a) a reasonable remuneration fixed by the court; or (b) the value assessed at the contract rate. Where one party started to perform the contract but was prevented from completing it by the other party’s breach, he could claim a quantum meruit at the contract rate. In that situation, the amount would be an apportionment of the total contract price; the ratio which the work done bore to the total volume of work required to be performed under the contract. However, where there was no concluded contract, the court had to assess reasonable remuneration having regard to all the circumstances.”

 

In assessing how much should be paid to the plaintiff, the court takes into consideration the obligations imposed on the plaintiff in the joint venture agreement exhibit 1A and also in the Memorandum of understanding exhibit 1 as well as the recommendation of the arbitrator contained in exhibit D. The court takes cognizance of the fact that the plaintiff performed, to a large extent, what was expected of him at the pre-contract or bidding stage except that he could not make any financial contribution. The court takes into consideration the fact that the plaintiff failed to discharge his obligations at the execution of the contract where he was mainly required to carry out the fixing of the electrical lines.

 

It is on record that save, the provision of certain document required for the bidding from the plaintiff, the plaintiff made no contribution to the advancement of the joint venture and that it was the defendant that virtually ensured the execution of the contract. The arbitrator made a recommendation in the alternative in exhibit “D” that the plaintiff should be compensated for the role played by it in the bidding stage.

 

The arbitrator suggested that the plaintiff could be paid “30% of the anticipated profit” which he assessed at US$39,498. The question to be asked is that if the plaintiff failed to discharge his obligations under the agreement as required how on earth should he be entitled to 30% of anticipated profit. The 30% will only apply if the plaintiff had discharged its obligations under the contract and even then it would have to be calculated on the actual profit and not on an anticipated profit. Hence, in the view of the court the plaintiff cannot claim on any profit. The plaintiff is entitled to be paid for the work or services rendered.

 

In view of all the evidence on record therefore the court thinks that an amount of US$20,000 will be fair compensation to the plaintiff for the role it played in the joint venture up to the bidding stage. The court therefore awards an amount of US$20, 000 to the plaintiff as compensation for the role it played towards the winning of the contract up to the bidding stage.

 

However, in the evidence in chief of the plaintiff given on the 15th May 2015, its representative admitted that since this matter came to court the plaintiff company had been paid an amount of US$20,000 by the defendant company. The court therefore holds that the amount of US$20,000 paid by the defendant to the plaintiff pendente lite should be kept by the plaintiff as the compensation for the work or service it rendered in respect of the joint venture at the pre-contract or the bidding stage. Again in view of the conduct of the plaintiff in defaulting on its obligations towards the joint venture, the court is of the view that the plaintiff is not entitled to recover any interest on the sum paid to it.

 

Save for the award hereinbefore made, the plaintiff’s claims are dismissed.