KWANSA v. BRAHIMA [1966] GLR 784

Division: HIGH COURT, CAPE COAST

Date: 9 DECEMBER 1966

Before: ARCHER J.

CASE REFERRED TO

Dapaah v. Poku (1950) Oll.C.L.L. 173, W.A.C.A. NATURE OF PROCEEDINGS PRELIMINARY OBJECTION in an action for recovery of possession of a pledged farm and an order for accounts that at customary law a pledgee is not accountable to a pledgor.

COUNSEL

T.D. Brodie-Mends for Abadoo for the plaintiff.

Hayfron-Benjainin for the defendant.

JUDGMENT OF ARCHER J.

The plaintiff’s claim is for recovery of possession of one large cocoa farm containing over 500 trees situate at Botukwa near Agona Mankrong which the plaintiff pledged to the defendant as security for a loan of £G50 received by the plaintiff from the defendant. In respect of the said loan the plaintiff gave the defendant a written memorandum or receipt stating that the said loan was to be repaid from the amount of the proceeds of the cocoa received by the defendant for the period of three years. And as the proceeds from the cocoa farm for the main and middle seasons in each year exceeded £G50, it meant that the defendant was to recoup himself with the proceeds of the first year in respect of the said £G50 and receive the proceeds for the remaining two years as interest on the said loan.

According to paragraph (2) of the statement of claim, the transaction took place about ten years previously. The plaintiff further

[p.786] of [1966] GLR 784 alleges that he left after the transaction for another area to serve as a farm labourer. On his return he demanded the recovery of possession of the farm and the memorandum but the defendant replied that he had sold the cocoa farm to one Opanin Kwesi Edumadzi. The plaintiff also seeks an order for an account. The defendant by his statement of defence denied liability to account and pleaded not liable to the claim and asked that the claim should be struck out. The plaintiff joined issue with the defendant on paragraphs

(1) and (2) of the statement of defence. When the summons for directions was heard the following issues were set down for trial:

“(a) Whether the plaintiff is entitled to the relief as claimed herein.

S. Whether the transaction being one of a pledge by native custom of the cocoa farm in question, the defendant is liable or not.”

At the commencement of the hearing, counsel for the defendant raised a preliminary point of law and quoted Sarbah’s Fanti Customary Laws (2nd ed.) to support his submission that according to custom a pledgee is not accountable to the pledgor. He referred to page 83 of Sarbah’s book where it is stated that, “Where real property has been mortgaged, the mortgagee is absolutely entitled to enjoy, without any hindrance whatsoever, all profits accruing therefrom, nor is he accountable for the profits so enjoyed.” He also cited page 98 of Ollennu’s Principles of Customary Land Law where Blackall P. in the case of Dapaah v. Poku1 in a judgment delivered on 13 June 1950 is reported as saying:

“The essence of a native mortgage is that the mortgagee gets possession and enjoys the profits without accounting for them, while the mortgagor on his part may at any time redeem the mortgage, provided he pays back the loan and also all the expenses which the mortgagee has been put to.”

Counsel for the plaintiff maintained that the plaintiff obtained a loan from the defendant who agreed to pluck cocoa for three years and recoup himself with the proceeds of sale. A memorandum was then prepared with the defendant and therefore the action was maintainable.

After considering the submissions, I am of the opinion that the submission made by learned counsel for the plaintiff is still good

[p.787] of [1966] GLR 784 law but it seems that since Sarbah wrote his monumental masterpiece, the nature and concept of customary pledge has not only retained its trunk but has shot out branches with different foliage. But notwithstanding this accretion, the concept that a pledge is always redeemable has not undergone any legal or judicial metamorphosis but still governs the various types of pledges now in vogue. Thus Ollennu at pp. 103-105 of his book of Principles of Customary Land Law dwells on the innovations which have invaded the old concepts of pledge and uses the pledges of creeks for a number of years in the Keta (Anlo) and Tongu areas as illustrations. After revealing the evils and mischiefs arising out of the new types of pledges, he goes on at p. 104:

“To prevent this it became the practice, on taking a loan and pledging a creek, to agree that the pledgee should have the creek first of all for a specific number of flood seasons in full payment of the debt . . . The practice soon spread to other parts of the country.

Pledges of cocoa farms, coconut plantations, and even of houses, were made in that form.” All these transactions have been held as money-lending agreements and pledges and the form of the document prepared by the parties could not override the customary incidents of a pledge; and further, these transactions could be re-opened under section 3 of the Loans Recovery Ordinance.2 It seems to me that, assuming the averments in the statement of claim are true, the pledging of the plaintiff ‘s cocoa farm to the defendant for a period of three years during which the defendant should receive the proceeds in full satisfaction of the debt and interest is a perfectly legitimate type of pledge recognized in Ghana. During the three years agreed by the parties, the defendant is not accountable to the plaintiff. After the expiration of the period of three years, the defendant is certainly accountable to the plaintiff because the pledge is at an end and the proceeds of the cocoa farm have, as already agreed by the parties, redeemed the pledge.

Furthermore, on the strength of various decided cases, it seems that during the agreed three year period the plaintiff could redeem the pledge by tendering the amount of the loan to the defendant, subject of course to the payment of a reasonable compensation to the defendant in respect of improvements made by him to the farm.

[p.788] of [1966] GLR 784

The apparent confusion in this case lies in the fact that the statement of claim, in general terms and without specifying periods, claims an order for an account. I am convinced this claim for an order for account in general terms actuated and motivated counsel for the defendant to couch his statement of defence in the manner he did so as to render the plaintiff’s action unmaintainable because as I have already said, assuming the parties in fact agreed that the defendant should receive the proceeds for three years in full satisfaction of the debt, then obviously the defendant is not accountable to the plaintiff during that period. He is only accountable to the plaintiff after the expiration of the agreed period. After I had heard arguments on the preliminary point of law raised by counsel for the defendant, I adjourned further hearing anticipating that the plaintiff would amend his statement of claim accordingly to indicate for what period he is claiming an order for an account. But he did not. After careful consideration, I have decided that although the preliminary point has substance, the averments in the statement of claim demand that the trial should proceed to enable evidence to be adduced to establish the true nature of the transaction and its possible legal effects according to customary law. It is also my hope that the plaintiff in view of what I have said will endeavour to amend his statement of claim giving accurate or approximate dates for the cocoa seasons covered by the three year agreement and also indicating from what period he is claiming an order for account.

DECISION

Trial to proceed.

S. K. T.