Arthur Vrs Quayson & Another [2022] GHADC 327 (21 November 2022)

IN THE DISTRICT COURT HELD IN THE WESTERN REGION ON THURSDAY AT AGONA NKWANTA ON THE 21ST NOVEMBER 2022 BEFORE HIS WORSHIP SIDNEY BRAIMAH DISTRICT MAGISTRATE --------------------------------------------------------------------------------------------------------- MICHEAL KOJO ARTHUR ::: ::: PLAINTIFF WR/AA/DC/A2/39/2022 OF GPS WH-1921-1105 AKWIDAA VRS: 1. JAMES QUAYSON 2. CECILIA NKETSIA ALL OF AGONA NKWANTA ::: ::: DEFENDANTS ---------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------- J U D G M E N T The reliefs sought by the plaintiff against the defendants as endorsed on the writ of summon stated the following: (a) An order directing the defendants to refund an amount of Ghc3000.00 (b) being financial assistance defendants requested from plaintiff. (c) Interest on the said amount at prevailing bank rate from August 2021 till date of final payment. The evidence adduced by plaintiff is that 2nd defendant applied for loan of Ghc2500.00 from the plaintiff. The loan was guaranteed by 1st defendant who is the husband of 2nd defendant. The loan agreement is evidenced in exhibit A. According to plaintiff and PW1, the 2nd defendant was to defray the loan granted to her with daily contribution of Ghc40.00 exclusive of Sundays for a period of six months. Plaintiff contended that 1st defendant made a further application for loan of Ghc500.00 from him to enable him pay his children’s school fees and for same was added to the loan contracted making the total loan to be Ghc3000.00 against the defendants. In response of the allegation by 1st defendant that plaintiff owes him unpaid salary, commission and contribution to susu operated by him, plaintiff submitted that 1st defendant was subsequently employed by him after the grant of the loan to recruit people as sales personnel and the terms of his engagement are that 1st defendant would receive one-percent (1%) commission of the sale or salary due to the recruits engaged by him. Plaintiff further submitted that 1st defendant was also required to engage in sale promotion and commercial activities to publicize and promote the company. The plaintiff asserted that upon engagement of 1st defendant, he recruited two people and that one of them terminated his employment after two months. The plaintiff again submitted that the total sales generated by the persons engaged by 1st defendant was Ghc9865.50 per month for August, September and October 2021 respectively and that 1% commission thereof amounted to Ghc98,70 and that he personally increased the commission to GHc300.00 for the 1st defendant for August and September 2021. Thereafter the 1st defendant stopped recruiting staff after a misunderstanding between them. The plaintiff denied that he owes the 1st defendant. In their defence, defendants did not contest the evidence that 2nd defendant applied for a loan from the plaintiff and same was guaranteed by 1st defendant except that the amount was Ghc2000.00 and not Ghc2500.00. The defendants submitted that plaintiff wrote “Ghc2500/2000” in exhibit A as the amount of money taken as loan because he demanded Ghc500.00 out of the Ghc2500.00 from them as a condition for the grant of loan. The defendant accordingly disputed the amount of loan granted to them. The defendants also admitted that the 1st defendant subsequently applied for Ghc500.00 loan from plaintiff and that add to the loan to make the total amount collected to be Ghc2500.00. The defendants however asserted that the loan contracted has been defrayed. The defendants submitted the loan was defrayed in the following ways; that 2nd defendant made four Ghc40.00 payments to plaintiff; that 1st defendant recruited five sales persons for the plaintiff with the agreement that he would be paid Ghc300.00 per month in addition to 1% commission for the sales or susu collected by the persons recruited; that the terms of employment of 1st defendant indicated that he was also entitled to Gh500.00 commission for the five persons recruited per month making the amount due him to be Ghc800.00 per month for the four months he worked for plaintiff and that 1st defendant further made Ghc160.00 susu contributions to the company and that when all the amounts due him are added; they would be sufficient to defray the amount owed to the company. The defendants denied the claims against them. On the evidence, the facts do not disclose any controversy that plaintiff granted a loan to 2nd defendant for which 1st defendant guaranteed; that 2nd defendant made four payments of Ghc40.00 to plaintiff towards defraying the loan; that plaintiff engaged 1st defendant to recruit workers for the company; that 1st defendant was entitled to commission from the incomes generated by the workers recruited by him; that 1st defendant ceased working for the company and that plaintiff had made repeated complaints to a pastor and others to appeal to 1st defendant to pay the loan outstanding. On the totality of the evidence on record, the following issues are raised for determination: 1. Whether or not the plaintiff has the capacity to sue the defendants in this case? 2. Whether or not the defendants owes plaintiff Ghc3000.00? 3. Whether or not plaintiff is entitled to interest on the amount claimed and for same to take effect from August 2021 until final payment? 4. Whether plaintiff is entitled to his reliefs? In civil cases, the burden of proof determines the eventual outcome of the case between the parties and the party that is able to discharge the burden placed on him/her is likely to have the verdict in his/her favour. Under the rules of evidence, the burden is categorized into two heads i.e. the burden of persuasion and the burden of producing evidence. Sections 10(1) and (2 of the Evidence Act 1975 (NRCD 323) define the burden of persuasion as follows; 10(1) “ For the purposes of this Act, burden of persuasion means the obligation of a party to establish a requisite degree of believe concerning a fact in the mind of the tribunal of fact or the court.” 10(2) “ The burden of persuasion may require a party (a) to raise a reasonable doubt concerning the existence of a fact or (b) to establish the existence of a fact by a preponderance of probabilities or by proof beyond a reasonable doubt. Section 11 of the same Act defines the burden of producing evidence in subsection (1) and (4) as follows; 11(1) “ For the purposes of this Act, the burden of producing evidence means the obligation of a party to introduce sufficient evidence to avoid a ruling on the issue against that party.” 11(4) “ In other circumstances, the burden of producing evidence requires a party to produce sufficient evidence which on the totality of the evidence , leads a reasonable mind to conclude that the existence of the fact is more probable than it’s non-existence.” In most civil cases it is the plaintiff who bears the burden of proof, but in some instances, it is the defendant that bears the burden especially in circumstances where there are ‘confession and avoidance” situations. In the celebrated case of Zabrama vrs. Segbedzi (1991) 2 GLR 221, Kpegah J, as he then was stated as follows; “a person who makes an averment or assertion which is denied by the opponent has the burden to establish that his assertion or averment is true” Accordingly, the plaintiff has the burden of proof to establish the amount claimed in this case is owed to him. The title of the suit conclusively discloses that the plaintiff sued in his personal capacity. It therefore connotes that the plaintiff has personal and exclusive interest in the cause of action before the court. The capacity declared by plaintiff purports to exclude any other interest of any legal entity, artificial or natural in the present matter apart from his personal interest. The issue of capacity goes to the root and is fundamental in every action. A person who has an iron cast case would not be heard on the merits of his case where he is not able to satisfy the court that he has capacity to maintain the action. {See Asante-Appiah v Amponsa [2009] SCGLR 90 Holding 2, Sarkodie v Boateng II [1982-83] 1 GLR 715 SC and others.] Indeed, the capacity to sue was a matter of law and could be raised the court suo motu or by a party at any stage of the proceedings, even on appeal.( See Fosua & Adu Poku v Adu Poku Mensah [2009] SCGLR 310 Holding 6 and Bimpong Buta v General Legal Council (2003-2004) 2 SCGLR 1200.) On the record, it is patent that although the indorsement on the writ of summons issued under Order 8 of District Court Rules, 2009 [C. I 59]; the summary of subject matter of claim; the attached affidavit in support and the oral evidence on record categorically states that plaintiff personally granted the loan in issue to the defendants and therefore entitled to the reliefs sought in his personal capacity. The evidence again disclosed that the entirety of the plaintiff’s case is based on the loan contract contained in exhibit A. Exhibit A states that the loan contract was between A. K Genesis Multilevel Business (hereinafter known as the Company) which describes itself as company or a corporate entity and the defendants. Exhibit A again discloses that the Company is located in Accra, with branches in Takoradi and Agona Nkwanta. Exhibit A further discloses that plaintiff is not privy to the loan contract but stated on the third page or third sheet that the Executive Director of the company is one John Kojo Arthur whilst the plaintiff is listed therein as the Branch Manager. Both plaintiff and the said John Kojo Arthur signed their signatures in exhibit A by their respective positions in the Company. There is also no iota of evidence to suggest that the contract between the defendants and the Company was executed for the benefit of plaintiff to potentially enable him to maintain an action to enforce it under section 6 of Contract Act, 1960 [Act 25]. Accordingly, the court finds as fact that the oral evidence adduced by plaintiff is inconsistent and contradictory to his documentary evidence. Although the defendant did not challenge the capacity of the plaintiff to institute the present action; the court on the evaluation of the totality of the evidence raises the issue on its own volution as preliminary legal issue. By virtue of the principle in Salomon v Salomon [1897] AC 22, the Company is presumed to had acquired a separate legal personality from and could sue and be sued. As an employee; the plaintiff requires the requisite authority to invest him the locus standi to institute the present action against the defendants. The law is clear that employees of a Limited Liability Company are distinct from the Company. In Morkor v. Kuma(East Coast Fisheries Case) {1998-99} SCGLR 620 at page 632, Sophia Akuffo, C. J (then JSC) delivered as follows:- ‘’Save as otherwise restricted by its regulations, a company, after its registration, has all the powers of a natural person of full capacity to pursue its authorised business. In this capacity, a company is a corporate being, which, within the bounds of the Companies Act, 1963 (Act 179) and the regulations of the company, may do everything that a natural person might do. In its own name, it can sue and be sued and it can owe and be owed legal liabilities. A company is, thus, a legal entity with a capacity separate, independent and distinct from the persons constituting it or employed by it.’’ On the record; the tendering of exhibit A was fatal to the plaintiff. The law is settled that, if a party brings an action in a capacity he does not have, the writ is a nullity so are the proceedings and the judgment which would find on it. (See: Republic V High Court Accra, Ex-parte Aryeetey (Ankrah Interested Party) (2003-2004) SCGLR 398) Accordingly, having failed to establish his capacity to sue the defendants under exhibit A ; the plaintiff must necessarily fail on all other issues. Give the circumstances of the case, the court asks each party to bear their own cost. (SGD.) ................................... H/W SIDNEY BRAIMAH (MAGISTRATE) 7