ESSILFIE AND ANOTHER vs. TETTEH AND OTHERS [1995-96] 1 GLR 297

CASES REFERRED TO

(1) Hayford v Gbedemah, Court of Appeal, Accra, 21 May 1992, unreported.

(2) Lee v Showmen’s Guild of Great Britain [1952] 2 QB 329; [1952] 1 All ER 1175; [ 1952] 1 TLR 1115, CA.

(3) Lawlor v Union of Post Office Workers [1965] Ch 712; [1965] 2 WLR 579; [1965] 1 All ER 353. (4) Scott v Avery [1843-60] All ER Rep 1; (1856) 5 HLC 811; 10 ER 1121, HL.

(5) Baker v Jones [1954] 1 WLR 1005; [1954] 2 All ER 553‘, 98 SJ 473.

(6) Enderby Town Football Club Ltd v The Football Association Ltd [1971] Ch 591; [1970] 3 WLR 1021; [1971] 1 All ER 215, CA.

(7) Accra Hearts of Oak Sporting Club v Ghana Football Association [1982-83] GLR 111. (8) Leigh v National Union of Railwaymen [1970] Ch 326; [1970] 2 WLR 60; [1969] 3 All ER 1249. (9) Timber and Transport Kumasi-Krusevac Co Ltd, In re; Zastava v Bonsu [1981] GLR 256, CA. (10) Dickson v Pharmaceutical Society of Great Britain [1967] Ch 708; [1967] 2 WLR 718; [1967] 2 All ER 558, CA; affirming [1967] Ch 708; [1966] 1 WLR 1539; [1966] 3 All ER 404. (11) Nagle v Feilden [1966] 2 QB 633; [1966] 2 WLR 1027; [1966] 1 All ER 689, CA. (12) Faramus v Film Artistes’ Association [1964] AC 925; [1964] 2 WLR 126; [1964] 1 All ER 25, HL; affirming [1963] 2 QB 527; [1963] 2 WLR 504; [1963] 1 All ER 636, CA; reversing The Times, June 2, 1962.

(13) Kusi v Shell Co of Ghana Ltd [1973] 1 GLR 173, CA.

[p.300] of [1995-96] 1 GLR 297 (14) Davstone Estates Leases, Re; Manprop Ltd v O’Dell [1969] 2 Ch 378; [1969] 2 WLR 1287; [1969] 2 All ER 849.

NATURE OF PROCEEDINGS

APPEAL by the plaintiffs, two executive members of the Assin Fosu branch of the Ghana Private Road Transport Union (GPRTU) of the Trades Union Congress of Ghana from the ruling of the High Court, Accra upholding the preliminary objection of the defendants, three executive members of the Assin Fosu branch and the Central Regional Chairman of the GPRTU, to the jurisdiction of the court in an action by the plaintiffs in which they were claiming that the defendants had breached certain specified provisions of the constitution of the GPRTU. The facts are sufficiently set out in the judgment of Acquah JA.

COUNSEL

Cab-Addae for the plaintiff-appellants Barton-Oduro for the defendant-respondent.

JUDGMENT OF ACQUAH JA.

The parties in this suit are members of the Ghana Private Road Transport Union of the Trades Union Congress (hereinafter referred to as the GPRTU). The plaintiffs and the first three defendants are executive members of the Assin Fosu branch while the fourth defendant is the Central Regional Chairman of the GPRTU. The plaintiffs, contending that the first three defendants with the connivance of the fourth defendant are in breach of certain provisions of the GPRTU constitution, took the instant action claiming:

“(a) A declaration that the defendants have breached the constitution, rules and bye-laws of the GPRTU of the TUC by failing to call local meetings of the Fosu branch union for seven months contrary to article 18 (IV) (a).

(b) A declaration that the branch chairman has breached the said constitution, rules and bye-laws by failing to call for an audit of the union accounts since 1991 contrary to article 16 (IV).

(c) A declaration that the term of office of the present executive has expired since 17 April 1993.

(d) A declaration that the first defendant is not qualified to hold the office of chairman by virtue of articles 12 (a) and 26 of the constitution, rules and bye-laws, he not being the holder of a professional driver’s licence.

[p.301] of [1995-96] 1 GLR 297

(e) An order for fresh elections in accordance with the union’s constitution, rules and bye-laws.

(f) An order for an audit of the union’s accounts in accordance with the provisions of the constitution, rules and bye-laws, art 16.

(g) Perpetual injunction restraining the defendants, their agents, servants and assigns from exercising the functions of branch executives including the operation of the union’s accounts.”

The basis for the plaintiffs’ reliefs are contained in paragraphs (4)-(10) of their statement of claim, which read:

“(4) According to article 18 (IV) (a) of the union’s constitution, a branch (union) should hold general meetings to review its activities every three months.

(5) The last meeting of the said branch union was held seven months ago, yet all efforts made by the plaintiffs and other concerned members to rectify the situation have proved futile.

(6) Also under article 16 (IV) of the constitution, branch or local accounts shall be audited once a year on the directions of the regional secretariat but this has not been done since 1991.

(7) The plaintiffs contend that under article 12 (i) (a) as read with article 26 of the constitution the terms of office of the present branch executives expired on 17 April 1993, they having been elected on 17

April 1989, yet all efforts by the plaintiffs to have fresh elections have proved futile.

(8) It is further contended that the first defendant not being professional driver, is not qualified to hold such a post as it contravenes article 12(1)(a) as read with article 26 of the constitution.

(9) The plaintiffs say the defendants are deliberately flouting the constitution by staying on in power despite criticisms and protests from the plaintiffs and other concerned members.

(10) It is believed that they are doing so because the first to third defendants are dissipating or misapplying the branch moneys in collusion with the fourth defendant.”

On service of the writ of summons and statement of claim, the defendants entered a conditional appearance through their solicitors and moved the court under Order 12, r 24 of the High Court (Civil

[p.302] of [1995-96] 1 GLR 297

Procedure) Rules, 1954 (LN 140A) to set aside the writ of summons. Paragraphs (5), (6), (8) and (10) of their supporting affidavit read:

“(5) That it is clear from the nature of the plaintiffs’ reliefs being sought that the gravamen of the plaintiffs’ complaints are against alleged violations of the constitution of the GPRTU.

(6) That whilst all the alleged constitutional violations complained of by the plaintiffs are untrue, it is our contention that the plaintiffs’ action is in breach of the constitutional provisions of the GPRTU, specifically article 24 (vii) and therefore premature …

(8) That article 24 of the GPRTU constitution lays down procedures to be followed in seeking redress of grievances within the GPRTU and anticipates a court action as a last resort . . .

(10) That it is my contention that the plaintiffs have not bothered to resort to the laid down grievance procedure and therefore the action is premature and same must be struck out.”

The plaintiffs naturally filed an affidavit opposing the application on the grounds that the alleged grievance procedure in the constitution does not oust the jurisdiction of the courts. Furthermore, the very people manning the channels of redress are the defendants in this case. And that the first three defendants have on several occasions taken the second defendant to the law courts, including the very High Court where the instant suit is pending. It does not therefore lie in the mouth of the defendants now to resort to any grievance procedure in the constitution.

On 19 August 1993 Williams J acceded to the request of the defendants and struck out the suit with 40,000 costs. He reserved his reasons for a later date. This was delivered on 8 September 1993 wherein he tried to distinguish the previous suits of the GPRTU in the law courts from the instant one, and held that if the plaintiffs could not have gone to their local branch with that complaint because the defendants were the very people to deal with that complaint, they could have gone to the national secretariat.

Aggrieved by the above ruling, the plaintiffs lodged this appeal contending that the trial judge was wrong in dismissing their action. Mr Cab Addae, learned counsel for the plaintiffs, argued that the

[p.303] of [1995-96] 1 GLR 297 instant dispute was between members of the local and regional executives, and that article 24 did not provide for the determination of disputes involving such parties. Furthermore, there have been instances where members have resorted to the courts instead of the domestic procedure. Relying therefore on Hayford v Gbedemah, Court of Appeal, Accra, 21 May 1992, unreported he maintained that the dismissal of their suit was wrong in law. Mr Barton Oduro, for the defendants, submitted that the spirit behind article 24 of the constitution was settlement of all disputes internally and although the national secretariat is not explicitly clothed with original jurisdiction, it can be implied from this spirit of settlement that the dispute could be handled by it. The trial judge therefore properly interpreted article 24. Counsel distinguished Hayford v Gbedemah (supra) from the instant dispute and submitted that the fact that members had previously resorted to court actions does not validate such procedure. He concluded that in the face of article 24, the plaintiffs are duty bound to follow the procedure set out therein.

Now the right of an individual to resort to the law courts for the adjudication of his dispute is so fundamental in our social structure, and essential in ensuring peace and stability, that the courts would not permit this right to be trampled on by vague and prejudicial exclusionary clauses forbidding access to the courts. For in as much as society recognises the right of individuals to enter into agreements of their choice, that right is necessarily limited by the ideals of the general law of the land, morality and social justice. Ideals epitomised in the expression “public policy.” Thus Lord Denning in Lee v Showmen’s Guild of Great Britain [1952] 1 All ER 1175 at 1180-1181, CA said:

“Although the jurisdiction of a domestic tribunal is founded on contract, express or implied, nevertheless the parties are not free to make any contract they like. There are important limitations imposed by public policy. The tribunal must, for instance, observe the principles of natural justice. They must give the man notice of the charge and a reasonable opportunity of meeting it. Any stipulation to the contrary would be invalid . . . Another limitation arises out of the well-known principle that parties cannot by contract oust the ordinary courts of their jurisdiction . . . They can, indeed, make the tribunal the final arbiter on questions of fact, but

[p.304] of [1995-96] 1 GLR 297 they cannot make it the final arbiter on questions of law.”

On the whole, one can identify five main objects or grounds on which public policy may invalidate a contract; first, objects which are illegal by common law or by statute; secondly, objects injurious to good government either in the field of domestic or foreign affairs; thirdly, objects which interfere with the proper working of the machinery of justice, fourthly, objects injurious to family life; and fifthly, objects economically against the public interest. Of course there may be cases which do not fit clearly into any of these five categories.

How then does the law look upon exclusionary clauses in an association’s constitution, that is clauses forbidding access to the courts in the event of a dispute and providing for recourse to domestic tribunal? Now, where these exclusionary clauses provide for an initial recourse to the domestic tribunal, especially in disputes involving issues of fact before recourse to the ordinary courts, the courts will generally recognise and give effect to them. As Ungoed-Thomas J said in Lawlor v Union of Post Officer Workers [1965] 1 All ER 353 at 363:

“Trade union rules clearly cannot oust the jurisdiction of the courts. Contracts, . . . may provide that recourse to domestic tribunals shall be exhausted before there is recourse to the courts, and the courts may recognise and give effect to that contract; but that does not oust its jurisdiction.”

It means therefore that first, public policy will not permit complete ouster of the jurisdiction of the courts: see Scott v Avery [1843-60] All ER Rep 1, HL. Lynskey J in Baker v Jones [ 1954] 2 All ER 553 at 558 stated the law thus:

“Although parties to a contract may, in general, make any contract they like, there are certain limitations imposed by public policy, and one of those limitations may be that parties cannot, by contract, oust the ordinary courts from their jurisdiction.”

Lord Denning in the Lee case (supra) said also at 1181:

“If parties should seek, by agreement, to take the law out of the hands of the courts and into the hands of a private tribunal, without any recourse at all to the courts in case of error of law, then the [p.305] of [1995-96] 1 GLR 297 agreement is to that extent contrary to public policy and void.”

Whatever the jurisdiction of the domestic tribunal, whether on issues of fact or law, the courts are the final arbiter on questions of law and any clause to the contrary is therefore invalid. Secondly, even in dispute involving issues of fact, whenever there is a breach or a threatened breach of the principles of natural justice by the domestic tribunal, no exclusionary clause can exclude the jurisdiction of the courts to entertain the matter. Thus in Enderby Town Football Club Ltd v The Football Association Ltd [1971] 1 All ER 215 at 218, CA, Lord Denning stated:

“. . . if the court sees that a domestic tribunal is proposing to proceed in a manner contrary to natural justice, it can intervene to stop it. The court is not bound to wait until after it has happened.”

Again Roger Korsah J pointed out in Accra Hearts of Oak Sporting Club v Ghana Football Association [1982-83] GLR 111, that where the principles of natural justice are being breached there is no forum superior to the courts where redress could be sought. Accordingly, for exclusionary clauses to be enforceable, the principles of natural justice should clearly and unambiguously be preserved in both the composition and procedure of the domestic tribunal.

Thirdly, even where there is an express provision that a plaintiff must first exhaust his domestic remedies, the courts are not absolutely bound by that because the court’s jurisdiction cannot be ousted, but the plaintiff will have to show cause why the court should interfere with the contractual position: see Leigh v National Union of Railwaymen [1969] 3 All ER 1249. This is consistent with the rule in the case of a submission to arbitration where the court always has a discretion whether to stay an action but cause must be shown why it should not. The plaintiff may in such circumstances justify his resort to the courts by showing for example, that the courts are better suited to determine the issues involved in his dispute, especially where the issues are that of law. He may also show that the members have manifested a clear intention to be no longer bound to resort to the domestic tribunals. Thus in In re Timber and Transport Kumasi-Krusevac Co Ltd; Zastava v Bonsu [1981] GLR 256, CA wherein it was provided in an agreement between the parties that certain terms of that agreement shall remain irrevocable for ten years and no court action shall be

[p.306] of [1995-96] 1 GLR 297 brought on it until the expiration of that ten years, the Court of Appeal held that if the allegations contained in the petitioners’ affidavit were established, that would imply that the respondents had clearly shown by conduct that they did not regard that provision as binding and in that case the petitioners would be justified in treating the agreement as at an end, Sowah JSC (as he then was) delivering the judgment of the court said at 262:

“The principle which emerges from a long line of decisions is that where one party manifests a clear intention to be no longer bound by the terms of his contract or where he openly repudiates it, the innocent party may treat the contract as at an end and seek such remedies as are open to him.”

It is clear from the foregoing that exclusionary clauses, though part of the parties’ contract, are nevertheless subject to the control of the courts. And the courts would not hesitate to declare them invalid if they seek to oust the jurisdiction of the courts: see Scott v Avery (supra); if they are in unreasonable restraint of trade: see Dickson v Pharmaceutical Society of Great Britain [1967] 2 All ER 558, CA; if they unreasonably shut out a man from his right to work: see Nagle v Feilden [1966] 1 All ER 689, CA; and if they lay down a procedure which is contrary to the principles of natural justice: see Faramus v Film Artistes’ Association [1964] 1 All ER 25 at 33, HL.

Furthermore, because exclusionary clauses cannot oust the jurisdiction of the courts, they at best, suspend the court’s determination of the dispute pending the exhaustion of the domestic remedies. This means that where in a court action, a defendant contends that the plaintiff ought to have exhausted the domestic remedies before coming to court, the proper order the defendant is to apply for is a stay of the proceedings. For whenever parties agree to refer their disputes initially to a domestic tribunal before recourse to the courts, that agreement is to all intents and purposes a submission to arbitration constituted by the domestic tribunal. And the remedy for a breach of this submission is an application for stay of the proceedings: see Kusi v Shell Co of Ghana Ltd [1973] 1 GLR 173, CA.

The procedure is succinctly stated in Halsbury’s Laws of England (3rd ed), Vol 2, p 21, para 50 as follows:

“If any party to an arbitration agreement, or any person claiming

[p.307] of [1995-96] 1 GLR 297 through or under him, commences any legal proceedings in any court against any other party to the agreement, or any person claiming through or under him, in respect of any matter agreed to be referred, any party to those legal proceedings may at any time after appearance, and before delivering any pleadings or taking any other steps in the proceedings, apply to that court to stay the proceedings, and that court or a Judge thereof, if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the agreement … may make an order(s) staying the proceedings.”

It is therefore improper in such circumstances to apply either to set aside the writ as in the instant case, or to dismiss the suit as it was unsuccessfully sought in Hayford v Gbedemah (supra).

Now article 24 of the GPRTU constitution provides, inter alia:

“(i) A dispute in the union shall in the first instance be settled at local or branch level. If the aggrieved party is not satisfied, he can appeal to the regional secretariat with a copy of the appeal to the branch.

(ii) If the party is still not satisfied with the ruling of the regional secretariat, he can appeal to the national secretariat, and after that, the national executive council, before he appeals to the executive board of the Trades Union Congress, and follow it up as laid down in the Industrial Relations Act, 1965 (Act 299).

(iii) With the exception of disputes or grievances which are referred to the national executive council or the executive board of the Trades Union Congress, all disputes or grievances should be settled within a month, or the aggrieved party can appeal to the next higher stage for redress.

(iv) Under no circumstances shall a case within the union be sent to any external body for investigation or settlement without the prior approval of the national executive council. In all such situations, only cases that have exhausted the grievance procedure under this article may be considered.”

Mr Barton Oduro has submitted that the spirit behind these provisions is to ensure that all disputes are resolved through the internal grievance procedures set out in the constitution. I completely agree with counsel, but then it is one thing wishing to achieve that result, and another thing

[p.308] of [1995-96] 1 GLR 297 being able to ensure through clear and unambiguous provisions that an adequate internal channel of redress is provided for internal disputes. Furthermore, article 5(ii) which empowers the national executive council to take legal action, inter alia, against a member clearly runs counter to the desired spirit of internal settlement.

Now it is clear from the provisions of article 24 of the constitution that only the local or branch levels have original jurisdictions in the adjudication of disputes. The regional secretariat, the national secretariat, the national executive council and the executive board of the TUC have all appellate jurisdictions. Therefore where by the nature of the dispute, the local or branch level cannot assume jurisdiction, there is no forum to commence the hearing of that dispute.

The dispute in the instant writ is by two local executives against three local executives and the regional executives. The nemo judex in causa sua rule would therefore not permit the local secretariat to assume jurisdiction. Neither can the regional secretariat assume jurisdiction. And the trial judge’s holding that the national secretariat can assume jurisdiction is not borne out by article 24 nor any provision of the constitution. There is therefore no competent internal forum to handle this dispute.

But quite apart from the issue of forum, the issues involved in this suit are matters calling for interpretation of various sections of the GPRTU constitution, which are issues of law. And with issues of law the courts are better suited than any domestic tribunal, to determine. So that even if there has been a competent domestic tribunal, once the issues are those of law, the courts cannot be prevented by any exclusionary clause from determining them. Thus in Baker v Jones (supra) where the central council was made the sole interpreter of the rules of the association, Lynskey J said at 559:

“The interpretation of the rules is a question of law which the courts will examine. In my view, therefore, the provisions in the B.A.W.L.A. rules, making the central council the sole interpreter of the rules and their decision in all cases final, is contrary to public policy and void.”

See also Re Davstone Estates Leases; Manprop Ltd v O’Dell [1969] 2 All ER 849.

Indeed, in Hayford v Gbedemah (supra) this court had occasion to

[p.309] of [1995-96] 1 GLR 297 examine this article 24 and held that the article does not oust the jurisdiction of the courts, and further, an aggrieved member may ignore the domestic procedure set out therein if the nature of his dispute makes the domestic procedure inappropriate. From what I have said so far, some of the factors which would justify recourse to the courts by an aggrieved GPRTU member, notwithstanding article 24 are:

(i) If there is no competent domestic forum.

(ii) If the principles of natural justice would be breached.

(iii) If the issues involved are purely those of law.

(iv) If it can be established that the members have by their previous conduct evinced a clear intention not to resort to the domestic procedure.

Now from the record of proceedings, I am inclined to believe that the defendants’ application to prevent the court from going into the grievances of the plaintiffs was not made in genuine desire to have the matter dealt with in accordance with article 24. For, precisely a week after the filing of the writ of summons, the defendants excluding the fourth, purported to expel the plaintiffs from the union in accordance with article 24 (vii). And almost two weeks after the expulsion, they filed their application to set aside the writ. In What capacity therefore could the plaintiffs maintain their grievances if they are directed to resort to the domestic procedure? Such sinister moves must never receive the blessing of the courts.

In all the circumstances of the case, therefore, the trial judge ought to have refused the application and rather determined the claims of the parties. I will therefore allow the appeal, set aside the order dismissing the action, and in its place order that the High Court assumes jurisdiction in the matter and determine the reliefs of the parties.

JUDGMENT OF ESSIEM JA.

I agree.

JUDGMENT OF AFREH JA.

I agree.

DECISION Appeal allowed.

DRKS