KARAM v. A. G. LEVENTIS & CO. LTD. [1965] GLR 96

DIVISION: SUPREME COURT

DATE: 1 March 1965

BEFORE: MILLS-ODOI., OLLENNU AND BRUCE-LYLE JS.S.C.

CASE REFERRED TO

Chellaram & Sons (Ghana) Ltd. v. Halabi [1963] 1 G.L.R. 214, S.C.

NATURE OF PROCEEDINGS

APPEAL from a ruling of Apaloo J. (as he then was) sitting in the High Court, Kumasi (unreported), wherein he ruled in favour of the respondents in an action by the appellant to attach property which had been mortgaged to the respondents.

COUNSEL

Osei-Bonsu for the appellant.

No appearance by or on behalf of the respondents,

JUDGMENT OF BRUCE-LYLE J.S.C.

This is an appeal from the ruling of Apaloo J. (as he then was) sitting in the High Court, Kumasi, and dated 3 October 1961.

The facts are that a writ of fi. fa. was issued on 13 May 1961 in execution of a judgment against the defendants judgment debtors (hereinafter referred to as the judgment debtors) and in favour of the plaintiff-appellant (hereinafter referred to as the plaintiff); the judgment is dated 13 February 1961. On the strength of the fi. fa., plot No. 576 situate in the old town section of Kumasi was attached and advertised for sale by public auction on 20 June 1961. The claimants-respondents (hereinafter referred to as the claimants) interpleaded on 24 May 1961, on the ground that they were entitled to the property by reason of a mortgage deed dated 25 October 1960. On the matter coming before the High Court on the sheriff’s summons, and after arguments by counsel for both the plaintiff and the claimants, the trial judge ruled in favour of the claimants. Against this ruling the plaintiff has appealed to this court.

Counsel for the plaintiff argued this appeal on the following grounds:

“(1) Since no deed of mortgage was executed pursuant to the consent given by the President of Ghana, there was no proper mortgage of the premises in question.

(2) On the record (in particular exhibit A), the claimants acted in fraud of the creditor, and ought not to be allowed to take the benefit of the said fraud.

[p.98] of [1965] GLR 96

(3) The document dated 25 October 1960 as exhibit B on which the claimants relied told a lie about itself and ought not to be held valid—it recited at page 16 clause 4 that ‘The consent in writing of both the lessor and the Asantehene (in this case the Administrator of Stool Lands) to the mortgage hereby made has been duly obtained.’ This averment is false to the knowledge of both mortgagor and mortgagee.

(4) Since it was apparent that there were several disputed matters, some of them matters of law, the learned judge ought properly to have ordered pleadings and allowed the case to be tried substantively.”

In support of grounds (1) and (3) learned counsel argued that the mortgage was executed on 25 October

1960 and that the consent of the President, which was essential for the mortgage of lands in Kumasi, having been obtained on 3 March 1961 and subsequent to the date of the mortgage, there was no valid mortgage of the land in question.

It is apparent on the face of the record of proceedings that this same ground was canvassed before the trial judge who ruled on it as follows:

“It is plain therefore that the claimants had a valid title to this property long before the execution creditor applied for and sought to dispose of it by fi. fa. Mr. Adade has however argued with some force that the mortgage is invalid as the consent, as I understand him, post-dates the mortgage . He contended that there can be no valid mortgage before 3 March and as no mortgage was executed subsequent to that date, there was no valid charge on the property. The short reply to this submission is that if the claimants did not take steps to perfect their title before 29 March 1961, it was none of the execution creditor’s business. The bald fact is that about two months before the execution creditor sought to exercise any rights in the premises, the claimants had an unimpeachable title.”

I agree with this lucid ruling of the learned trial judge and I am of the opinion that these two grounds are without substance and should fail.

In support of ground (2) learned counsel argued that once the date for the President’s consent and that. of the registration were subsequent to the date of the judgment the claimants should be deemed to have acted in fraud of the creditor (i.e. the plaintiff)

[p.99] of [1965] GLR 96 and ought not to be allowed to take the benefit of the said fraud. Was there any fraud on the part of the claimants in this case? An answer to this question will in my opinion dispose of this ground.

Counsel in support of this contention has relied on the case of Chellaram & Sons (Ghana) Ltd. v. Halabi.1

I have considered the facts in the case cited and I find that they are not on all fours with the present case.

In the case cited above the property of the judgment debtors was conveyed when the claim against them was pending in court and the claimant was, at the material time when the writ was issued, the assistant manager of the judgment debtors. The, Supreme Court in effect held that in the circumstances the claimant knew of the civil action pending against the judgment debtors and that in all the circumstances the property was conveyed with the intention of defrauding the creditors in the pending action.

In the instant case the claimants, by the mortgage dated 25 October 1960 became purchasers for value long before the judgment of 13 February 1961, in favour of the plaintiff and therefore could not have had notice of a judgment which was not in existence at the time of the execution of the mortgage. There is also nothing to show that the claimants knew at the time of the execution of the mortgage that the judgment debtors were indebted to the plaintiff; neither is there anything to show that the claimants had any notice of such indebtedness.

The Statute of Fraudulent Conveyance, 1571,2 which is applicable in this country, provided in effect that all conveyances and dispositions of property, real or personal, made with the intention of delaying, hindering or defrauding creditors, should be null and void as against them, their heirs, etc. and assigns. It further provided that nothing therein contained should extend to any estate or interest made on good consideration and bona fide to any person not having, at the time, any notice of such fraud. I am satisfied that the circumstances of the instant case are amply covered by the proviso in that there is nothing on record to show that the claimants had notice of any fraud at the time of the execution of the mortgage. I further find that the interest in the land passed to the claimants on the date of the execution of the mortgage and not on the dates of the President’s consent or registration; what the claimants did on those dates was simply to perfect their title which was long in existence. In the result I hold that there was no fraud on the part of the claimants and this ground should also fail.

[p.100] of [1965] GLR 96

In support of the last ground counsel argued that from the arguments advanced by counsel for both parties before the trial court, there appeared to be very important issues of fact and law and therefore the trial judge should have ordered pleadings. Order 57, r. 9. of the Supreme [High] Court (Civil Procedure)

Rules, 1954,3 relating to interpleader suits states as follows:

“ 9. Where the question is a question of law, and the facts are not in dispute, the Court or a Judge may either decide the question without directing the trial of an issue, or order that a special case be stated for the opinion of the Court. If a special case is stated, Order 34 shall, as far as applicable, apply thereto.”

I find from the arguments of counsel for both parties on record that there were no facts in issue and that the issues before the trial court were purely those of law which could have been disposed of in no other manner than the way it was so disposed of by the learned trial judge exercising his discretion under the rule quoted supra, and that no miscarriage of justice has been occasioned by this mode of trial. In the circumstances this ground should also fail.

In the result I find no substance in this appeal and I dismiss it accordingly.

JUDGMENT OF MILLS-ODOI J.S.C.

I agree.

JUDGMENT OF OLLENNU J.S.C.

I also agree.

DECISION

Appeal dismissed.

E. A.-A.