KOME v. YEMOH AND GHANA COMMERCIAL BANK [1961] GLR 192

DIVISION: IN THE SUPREME COURT

DATE: 10TH APRIL, 1961

BEFORE: VAN LARE, SARKODEE-ADOO AND AKIWUMI, JJ.S.C.

NATURE OF PROCEEDINGS

APPEAL from the decision of Acolatse, J. sitting in the Land Court, Accra, on the 8th April, 1959, (unreported) in an action for declaration of title, recovery of possession and cancellation of a deed of conveyance of land and premises thereon.

COUNSEL

B.J. da Rocha for the appellant.

Koi Larbi for the respondents.

[p.193] of [1961] GLR 192

JUDGMENT OF AKIWUMI J.S.C.

Akiwumi J.S.C. delivered the judgment of the court. In this case the plaintiff claims declaration of title and recovery of possession of the premises contained in a deed of conveyance dated the 25th May, 1954, and also for the cancellation of the said instrument made between the plaintiff and the first defendant whereby the plaintiff conveyed the subject-matter in dispute to the first defendant by way of an outright sale for the sum of £2,500. This instrument was exhibited and marked C in the proceedings.

The facts are that the plaintiff owed several creditors who were worrying him and he approached the first defendant for help. He offered to sell the property to the first defendant for £2,500. The first defendant was to pay off the plaintiff’s creditors and to pay the balance to him (plaintiff). The first defendant accepted the offer and in fact paid the sum of £244 6s. on account of the plaintiff’s creditors and according to him, paid the balance to the plaintiff by instalments and was given receipts for the payments by the plaintiff. After the sum of £2,500 had been paid by the plaintiff the first defendant went to Mr. F. K. Apaloo, a solicitor, (as he then was) for exhibit C to be prepared. The plaintiff gave Mr. Apaloo a copy of his deed of gift, exhibit A, which was his root of title to the property.

When Mr. Apaloo asked for the original, the plaintiff told him that it was missing. The plaintiff supplied Mr. Apaloo with the necessary particulars and the agreed purchase price of the property to enable Mr. Apaloo to prepare exhibit C, which was eventually executed by the plaintiff and first defendant. On Mr. Apaloo enquiring about payment of the agreed purchase price of £2,500 he was told by the first defendant not to worry about it. The plaintiff was present and heard what the first defendant said but remained silent, in the circumstances admitting that settlement of the purchase price had been concluded. The first defendant in his evidence said that in executing exhibit C he handed to the plaintiff all the receipts covering the sum of £2,500 which he had paid to the plaintiff. The plaintiff never challenged this evidence of the first defendant.

Later on, the first defendant approached the Ghana Commercial Bank, the second defendants, in this suit, for a loan and offered exhibit C to secure the loan. The bank sent exhibits A and C to Mr. Lokko, their solicitor, to investigate and prepare the necessary mortgage instrument. The plaintiff and the first defendant went to Mr. Lokko about the preparation of the mortgage. On Mr. Lokko enquiring about the original of the plaintiff’s root of title, the plaintiff falsely represented that it was with one of his brothers who was then in the Northern Region and that it was lost. Mr. Lokko, believing the plaintiff whom he had known before, advised the loan by the second defendants to go through and a mortgage deed, exhibit 1, was prepared and executed by the first defendant in favour of the second defendants.

Everything went smoothly until the first defendant failed to repay the second defendants the debt due on exhibit 1. The second defendants, in 1957, then took steps to exercise their power of sale under the mortgage, whereupon the plaintiff instituted the present action against the first and second defendants, claiming the reliefs stated above. The plaintiff in his evidence maintained that although exhibit C appears to be an outright sale it was really intended to secure the payment by the first defendant to [p.194] of [1961] GLR 192 his (plaintiff’s) creditors, although he did not give first defendant a list of them, and further alleged that the first defendant did not pay him the whole of the said sum of £2,500, and he relied on the fact that there was no endorsement of the payment on the deed of conveyance, exhibit C, and therefore urged that exhibit C should be declared null and void. It turned out that it was only during the trial of this case that the plaintiff for the first time disclosed that the property had in fact been mortgaged to Messrs A. G. Leventis & Co. Ltd. who had in their possession the original of the plaintiff’s root of title. This fact was never disclosed to the first defendant by the plaintiff throughout his dealings with him.

It is clear from the evidence that the plaintiff knew all the time that he was dealing fraudulently with the first defendant by not disclosing the existence of his original root of title which he had deposited with A. G. Leventis & Co. Ltd. He now comes to court wanting to take advantage of his own fraud. It is a well known maxim of law that he who seeks equity must come with clean hands. This the plaintiff did not do. By holding out the first defendant to the second defendants as the true owner of the premises in dispute the plaintiff is estopped from denying that the first defendant is owner of the premises in question.

During the transaction and after, the plaintiff remained in the house as the first defendant’s tenant and whilst there, assisted the first defendant in collecting rents from the other tenants of the house and paying them to the first defendant. He cannot now be heard to say that the first defendant had not paid him the agreed purchase price of £2,500 in full. Judgment was rightly in our view given against the plaintiff in the court below, and being dissatisfied he appealed to this court. Learned counsel for the plaintiff — appellant has abandoned the appeal against the second defendants absolutely, and as against the first defendant, he abandoned the grounds of appeal that were originally filed, but has asked leave to argue the supplementary grounds which he filed later. In the course of his argument he conceded that the deed of conveyance from the plaintiff to the first defendant (i.e. exhibit C) was valid but submitted that in as much as it was not endorsed with the payment of £2,500 it was voidable. He further submitted that the learned judge in the court below did not, in clear cut language, find as a fact that the defendant paid the agreed purchase price mentioned in the instrument.

It is evident that although the learned judge was somewhat ambiguous in his reasoning, he, however, eventually arrived at a conclusion from which it is clearly inferrable that he found that the first defendant did pay the agreed purchase price in full. There is ample evidence on record to justify this finding that the whole of the consideration in the instrument, exhibit C, had been paid by the first defendant to the plaintiff.

As the property is subject to a prior mortgage to Messrs. A.G. Leventis & Co. Ltd. the first defendant had only purchased the plaintiff’s equity of redemption which was the only interest the plaintiff had in the property; and this equity of redemption was the only right or interest which the first defendant mortgaged to the second defendants. It means therefore, that in order to realise their security the second defendants

[p.195] of [1961] GLR 192 will have to pay off Messrs. A.G. Leventis & Co. Ltd. before they could give a proper legal title to anyone on exercising their power of sale contained in the mortgage deed.

In the result we agree with the judgment of the court below and therefore dismiss the appeal.

DECISION

Appeal dismissed.