Fofie v. Zanyo [1992] 2 GLR 475.
SUPREME COURT, ACCRA
FRANCOIS, WUAKU, OSEI-HWERE, AIKINS AND EDWARD WIREDU JJ.S.C.
Francois J.S.C. On 10 November 1975 the plaintiff entered into a tenancy agreement with the defendants in respect of house No 33/5, Onyaa Crescent, Nima, Accra. The defendants were the personal representatives of the deceased owner.
The plaintiff was let into immediate occupation of the Nima house which was a three-storeyed building with a completed ground floor ready for occupation and two other floors in various stages of completion.
The first floor required very little, while the second which had only a structural shell in place, required considerable development.
The lease (exhibit 1) signed by the parties in 1975 was for a term of ten years at ¢600 rent a month. Three years rent-free occupation was a concession granted to the plaintiff, while three years rent advance, to take effect from 1978, was stipulated to be paid to the defendants. The plaintiff through his agent Peters, the first plaintiff witness, put tenants into the demised premises from whom he collected rents for the three-year period.
The significance of this three-year grace period has provoked debate. The defendants claim it was to enable the plaintiff complete the construction of the house. The plaintiff denies this and avers that the completion of the house was rather the duty of the defendants on which account moneys had been advanced them. No reasons however are offered for the three years rent-free enjoyment of the premises. We shall return to this again.
Sometime later, the defendants became hard-pressed for funds and decided to sell the Nima house to meet their financial exigencies. It was then urged on them by Peters, the first plaintiff witness mentioned above, that the plaintiff as a tenant in occupation should be given the first
refusal. Thus persuaded, the defendants addressed exhibit B to the plaintiff. The material part of exhibit B is as follows:
''… I am prepared to offer the house to you for sale. The selling price is ¢75,000. If this is acceptable to you, please confirm to enable us hold a meeting with your solicitor on the matter. Hoping to hear from you soon.''
It was clearly recognised that the sale of the house was dictated by extreme financial straits. But the plaintiff never formally responded to the offer. No letter in reply was written, nor did any other token of acceptance proceed from the plaintiff. No arrangement was ever communicated of a meeting with the plaintiff’s solicitor to finalise the purchase as stipulated in exhibit B. This apparent lack of interest on the part of the plaintiff, at a time when the defendants were in dire need of money, must have led them to consider the offer rejected.
Save for a passing expression of interest, nothing further had been done. A mere expression of interest cannot create any binding legal relationship, let alone an enforceable contract. The need for a solicitor, stated in exhibit B, was also an essential element in the arrangement, since important matters like the mode of payment, inspection of documents of title, questions on mortgage payments on the house, the adjustment of rent previously paid in advance as well as valuation in terms of the three-year grace period, were all grave legal matters in the equation requiring the solicitor’s expertise to reduce the coalescing of minds into a document that would meet the approval of all parties and obviate future dispute.
It was however only when the defendants sought the payment of accumulated rent arrears, that they were met with a fait accompli that the Nima house had been purchased and that what the defendants regarded as arrears of rent was rather the balance of the purchase price.
Clearly if the plaintiff was contending that he had concluded a contract, the burden of proving it was on him: see Bank of West Africa Ltd. v. Ackun [1963] 1 G.L.R. 176, S.C. It is on this issue of proof that the plaintiff fails: see Fry on Specific Performance (3rd ed.), para. 278, p.126. The burden of proving a concluded contract being on the plaintiff.
We may with profit turn to the pleadings. The plaintiff after stating in paragraphs (5), (6) and (7) of his claim that an offer for the sale of house No. 33/5, Onyaa Crescent, Nima, Accra had been made to him by a letter of 15 October 1976, failed to plead his mode of acceptance of the offer. In paragraph (7), the plaintiff averred that he paid the defendants
Turning again to the authority of Fry, acts of part performance which enable a contract to be withdrawn from the operation of the Statute of Frauds, 1677 must first be referable to the contract alleged and more importantly, referable to no other title: see Wakeham v. MacKenzie [1968] 1 W.L.R. 1175 and Kingswood Estate Co. Ltd. v. Anderson [1962] 3 All E.R. 593, C.A. Secondly, they must be such as to render it a fraud in the defendant to take advantage of the contract not being in writing; thirdly, the contract in its own nature must be of the kind enforceable by the court; and fourthly, there must be proper parol evidence of the contract which is let in by the acts of part performance. The celebrated case of Chapronière v. Lambert [1917] 2 Ch. 356 at 361, C.A. settled these principles.
In my view, as there was an already existing tenancy agreement between the parties, there was a heavier onus on the plaintiff to show how this was transformed into a purchase arrangement for which specific performance could be demanded as a legal remedy. This was crucial to the success of the plaintiff’s action. Simply put, the exclusiveness of a reference to the act of part performance to the contract is impossible if the acts of payment could be subsumed under an obligation to pay rent: that equivocation would be subversive and destructive of any claim to specific performance. Willmer L.J. cited the following passage on the issue from Anson, Law of Contract (21st ed. 1959) at p. 75 in Kingswood Estate
Co. Ltd. v. Anderson (supra) at 599: “The acts of performance relied upon must of themselves suggest the existence of a contract such as it is desired to prove . . .” Later dicta suggest that such acts should be exclusively referable to the contract to remove any ambiguities or uncertainties.
It is also my view that since exhibit 1 described a tenancy relationship in writing, a document was essential to annul that arrangement and create a vendor-purchaser relationship. Where, therefore, the facts urged in support, indeed establish a previous legal relationship, i.e a tenancy agreement, then the plaintiff has failed to prove the exclusiveness the law requires to relate the part performance to the contract.
It was on the basis of the evidence adduced and the applicable law that the trial court found in the defendants’ favour. The Court of Appeal differed. The defendants question the validity of the judgment of the Court of Appeal which reversed the High Court and decreed specific performance in favour of the plaintiff. The appellate court’s criticism of the trial judge’s performance in
scathing language, was as unfortunate as it was unsound. Most of it was based on the difference in perception of the evidence, and regrettably on the law. Where a judge or trial court arrives at a conclusion based on the advantage of seeing and hearing witnesses at first hand, the appellate court should be very slow to form a contrary view. It is trite law that an appellate court, when reviewing the exercise of discretion by a lower court, should not interfere unless the court below had applied wrong principles in arriving at the result or taken into account matters which were irrelevant in law or had excluded matters which were crucially necessary for consideration, or had come to a conclusion which no court properly instructing itself on the law could have reached: see Re Reed (A Debtor); Ex parte The Debtor v. Official Receiver [1979] 2 All E.R. 22, D.C. In Gross v. Lewis Hillman Ltd. [1969] 3 W.L.R. 787 at 798, C.A. Lord Widgery cautioned that an appellate court:
“… which sees only the transcript and does not see the witnesses, must hesitate for a very long time before reaching a conclusion different from that of the trial judge as to the credibility or honesty of a witness.”
In Adorkor v. Gatsi [1966] G.L.R. 31 at 34, S.C., the Supreme Court summed up appellate powers as follows:
“The law governing this is that while findings of specific facts are within the competency of the trial court alone, a finding of fact which is an inference to be drawn from specific facts found is within the competency of an appeal court no less than the trial court; in other words, an appeal court is in as good a position as the trial court to draw inferences from specific facts which the trial court may find.”
Unfortunately what the Court of Appeal attempted to do was to set aside not inferences drawn from facts but the very findings on specific facts of the trial judge. These factual conclusions were supported to the hilt by the evidence, most of which was supplied by the plaintiff and his witness, Peters. In the circumstances, there was no lawful warrant for the appellate court to differ from the conclusions of the trial court.
Since perception of facts may differ, and the appellate court’s jurisdiction to interfere is strictly within the recognised ambit of error in appreciation of the evidence, and error in inferential deductions as indicated above, it is necessary to pick a few glaring instances where the trial judge is fully vindicated on the evidence and the contrary view of
the appellate court remains replete in mystery.
It must also be stressed that the trial judge’s view that the plaintiff’s perception of truth was as inexact as it was unreasonable was amply supported by evidence even supplied by the plaintiff’s own witness; and it deepens the mystery further that a contrary view could be entertained. In examining the evidence, one is struck by the plaintiff’s complete lack of candour on material issues. I list them below. First, his strenuous denial of being put in possession of the premises in 1975, which perhaps explains his failure to mention the lease, exhibit 1, executed in 1975; a stance also reflected in the total absence in his pleadings of any tenancy relationship with the defendants prior to 1976.
The plaintiff’s witness, Peters, however swore that he secured for the plaintiff two tenants, Kludjeson and Aikins Enterprise, who paid rents to the plaintiff during the three-year grace period, commencing in 1975.
This period of three years wherein the plaintiff collected rents from sub-tenants and paid none to the landlord is only explicable on the basis that the plaintiff would complete the building.
The following responses from the plaintiff’s witness, Peters, to questions make the position clear:
“Q What the defendant told you was they wanted a tenant to take possession of the house as a tenant and use part of the proceeds to complete the house and reimburse himself from the rents accruing.''
A Yes, Kofi Fofie told me this. [The plaintiff however tells a different story.)
Q From 10 November 1975 to 1 October 1978 the rents to accrue within this period, they were not paid to defendant by the plaintiff.
A They were not paid.
Q The plaintiff was to use those rents for the work on the house?
A Yes.”
These answers support the defendants’ pleadings in paragraph (4)(e). Further, in my view, that was the only rational explanation for allowing the plaintiff three years rent-free possession of the premises with a power to put in his own tenants. The highly significant term “grace period” could only have been employed to signify such an arrangement. The plaintiff’s contention that the lessor should repair and yet he should pocket the tenants’ rents, essentially captures the character of the
plaintiff in its most unattractive hue.
Another pointer to the rationale behind granting a grace period of three years was the fact that a previous contractor, Nyarko, had roughly estimated that ¢24,000 would be enough to complete the house. Letting the house rent free for three years with an option to the lessee to put in his own sub-tenants, would enable the parties to start out in 1978 with a completed house, and no obligations on either side. The rent advance paid could then truly be applied as the stipulated rent from 1978.
The plaintiff makes a song and dance about paying off the indebtedness of the defendants to the First Ghana Building Society. Though the sum was only ¢16,000 he inflated it to the tune of ¢29,037.34. He was however caught out when he had to agree that payments to the building society were but part of the lease terms. The concession was as follows:
“Q These payments were part of the rent for the ten-year period under exhibit 1?
A Yes, I agree.”
Then follows another credibility test where the plaintiff failed abysmally. The plaintiff swore that the title deeds in respect of the Nima property were handed to him by the building society. The truth turned out to be that the documents were collected by Peters on the instructions of the defendants, and the plaintiff had to seek permission from the defendants to collect them from Peters. Moreover, he obtained the documents not as an owner, but to enable him to “use the document for a loan.” Indeed, his witness, Peters, stated the following: “I was keeping the document myself, but when the plaintiff wanted to raise a loan from the bank, I gave him the documents.”
If the building society had already given the documents to the plaintiff there would have been no need to request the defendants to ask Peters to hand them over to him. But more crucially, if he was the lawful owner of the house no such request would have been necessary, let alone the accompanying excuse of enabling him to borrow from the bank!
The whole passage of the first plaintiff witness’ answers in cross- examination in this area is significant and I make no apology for recapitulating it fully:
“Q You remember going to see the family members of defendant in 1989?
A Yes, I do remember.
Q The title deeds were in your custody?
A Yes.
Q You held them for and on behalf of the first defendant?
A Yes.
Q The plaintiff told the defendant he wanted their permission to use the house in dispute as a security for a loan from his bankers so as to complete the house?
A Yes.
Q The defendant and Elizabeth Oduro then signed exhibit C for him?
A Yes.
Q Following this authorisation you handed over exhibits D1, D2 and D3 to the defendants?
A Yes.”
The significance of this passage cannot be missed. Requesting the use of title deeds to the house in 1989 means without any equivocation whatsoever, that at that date, 1989, the plaintiff was aware that he was not the owner of the house. This completely exposes the lie that an offer had been accepted by the plaintiff.
The Court of Appeal perceived the evidence in this case as follows. I quote Lamptey J.A.:
“Sometime in 1976, barely one year after the letting of the uncompleted building to the plaintiff, there was a meeting between the plaintiff, the first defendant and other members of the first defendant’s family at which it was agreed to sell the uncompleted building to the plaintiff. After that meeting, thefirst defendant wrote formally offering to sell the uncompleted building to the plaintiff.”
One wonders where that evidence sprang from. As indicated above, the meeting was only with Peters who suggested that the plaintiff be offered the first refusal; hence exhibit B. With the distortion of the evidence by Lamptey J.A., one sees immediately why he thought there had been a concluded agreement and exhibit B was a mere formality with no legal consequence.
The learned judge also makes an extravagant claim that exhibit B “did not specify any time limit within which the plaintiff should indicate his acceptance of the offer. By June 1986 the plaintiff had paid the total sum of ¢75,000.”
Obviously the significance of exhibit B expecting an early response
was missed. But at law, where no time limit is specified, a reasonable time is intended and applied. A ten-year span is unreasonable by any standard and a court of equity would so hold. Again the urgent circumstances necessitating the sale must have been lost on the learned judge, so also the simple truth that a house worth X cedis would command much more cedis ten years later with the falling value of the cedi and the rising value of property. Besides, as the trial judge rightly pointed out, no one would demand a price for a house and be prepared to receive it in instalments over a ten-year period. It makes nonsense of exhibit 1 which catered for periodic payments in rent.
The appellate court also failed to see the true import of exhibit C, captioned “Consent, Property of late E. Oduro, House No. 33/5 Onyaa Crescent, Nima Residential Area, Accra.” This document authorised the liquidation of Oduro’s indebtedness to the First Ghana Building Society and “to transact business with the said documents with his bankers.” It is dated 12 February 1981 and signed by the defendants as “Executors of E. K. Oduro’s property.” It is also significant that exhibit C was prepared by the plaintiff. It can hardly therefore be controverted that as at 12 February 1981 the Nima property had not changed hands.
Now we come to the most damaging piece of evidence in this case. It involves the making of exhibit E, a receipt for payment of rent arrears according to the defendants, but claimed by the plaintiff to evidence the final payment of the purchase price for the Nima house. There is no dispute about the moneys received; or the identity of the parties to the transaction. Nor can it also be controverted that after the parties had executed exhibit E, the plaintiff unilaterally interpolated the words “For final purchase price payment house No. 33/5, Onyaa Crescent, Nima Residential Area, Accra” and “Total purchase price.”
It was the defendant’s case that the interpolations were fraudulent and made surreptitiously to transform payment of arrears of rent into payment of a purchase price for the house. The interpolation itself generates its own suspicion and is self-impugning. The trial judge saw it as a fraudulent act intended to overreach the defendants and deprive them of the ownership of their house. This is a conclusion of fact.
The Court of Appeal’s resolution of this aspect of the case is interesting. After concluding like the trial judge that the interpolation was the deed of the plaintiff after execution, contrary to the plaintiff’s protestations of innocence, they failed to translate this discreditable episode into any meaningful evaluation of the plaintiff.
No word of condemnation proceeded from their lips. Rather, they
attempted to downplay the effect. They said the interpolated words did not change the content of the document. One disagrees. The receipt before the interpolation, did not exclude full payment of rent arrears. On the other hand nothing prevented the plaintiff from drawing the defendants’ attention to an inadvertent omission if the receipt evidenced a purchase payment, and required mutual correction.
Again, the Court of Appeal significantly failed to draw the unavoidable conclusion following the plaintiff’s witness’ support for the defence: see Tsrifo V v. Dua VIII [1959] G.L.R. 63 and Asante v. Bogyabi [1966] G.L.R. 232, S.C. Indeed, to quote Megarry J. in Woodford v. Smith [1970] 1 W.L.R. 806 at 813, “The matter, . . . is not one on which there is conflicting evidence, but one on which there is virtually no supporting evidence.”
The appellate court failed yet again to apply the presumption that the decision of a trial court on the facts is correct, and the appellant consequently undertakes the burden to displace that presumption: see Kisiedu Dompreh (1935) 2 W.A.C.A. 268 and Akesse v. Ababio (1935) 2 W.A.C.A. 264. No effort whatsoever, was made to displace the presumption and the gratuitous exercise by the Court of Appeal demonstrated the disastrous consequences of ignoring this principle.
The award to the plaintiff of ¢5 million, claimed as expenditure, without due authorisation or proof, is another error of magnitude: see Bonham Carter v. Hyde Park Hotel Ltd. [1948] 64 T.L.R. 177 and Ghana National Trading Corporation v. Baiden [1991] 1 G.L.R. 567, S.C.
An interesting decision with distinctly similar features is the English case of Mills v. Haywood (1877) 6 Ch.D. 196, C.A. There Cotton L.J. stated at 202:
“… well-established principle, . . . that a party cannot call upon a Court of Equity for a specific performance unless he has shewn himself ready, desirous, prompt and eager.
This rule is specially applicable where the subject-matter of the contract is of a somewhat speculative and fluctuating value…”
One should compare this statement with the authoritative one of Fry at p. 515 (op cit):
“Specific performance is a relief which the Court will not grant unless the parties seeking it apply promptly and as soon as the case would permit.”
In Mills v. Haywood (supra) the would-be purchaser was a previous tenant and the court said at 202:
“But possession, in order to obviate the consequence to a purchaser of delay, must be possession under the contract sought to be enforced ... In such a case, as, eg. where the purchaser in possession has no right or title to such possession except as purchaser, his possession is an assertion on his part of his right under the contract of purchase, and acquiescence in his possession is a recognition by the vendor of this right. But where a tenant in possession contracts for the purchase of his landlord’s interest the case is different ... his possession as tenant is not an assertion of right under the contract of purchase. He may be in possession of the property, the house or land which is the subject of the contract of purchase, but, if he is, he is not in possession of, or asserting right to, the benefit or interest secured to him by the contract.”
In the Haywood case (supra) the issue also turned on whether moneys being paid represented rent or a purchase price, the contention of the landlord being that the possession of the plaintiff throughout was as tenant only. Again, the would-be purchaser claimed to have expended considerable sums of money in constructing a vault and did this on the faith of being entitled to the property. The court held that the mere fact of expenditure, even if proved was “not sufficient to show that he was in possession as purchaser.”
The pretended claim failed because, like the instant appeal, when a point arose to establish himself as purchaser he failed to make any such claim. The court held (supra) at 204:
“If the Plaintiff had in fact made the expenditure as owner in equity under a contract of purchase, either he or his solicitor would certainly have insisted on his rights as purchaser as soon as the trustee intimated his intention of selling the property.”
The similarity cannot be overlooked. Here the would-be purchaser of the defendants’ property still implored the defendants to lend him the title deeds to his own property, “to enable him borrow from the bank.” Title deeds that should have been but were not in his possession. No success could enure to any plaintiff in such an impossible situation.
This case also bears some resemblance to Atta v. Adu [1987-88] 1 G.L.R. 233, S.C. decided by this court unanimously on 15 June 1987. There, a claim for specific performance of a contract to sell a house failed because the plaintiffs acted tardily in pursuing the agreement to
purchase. The resemblance ends there. For whereas an initial contract existed in Atta v. Adu (supra), in the instant appeal, there has been no recognisable contract upon which a claim in specific performance can be founded. Indeed, if there had been, time would have been an insuperable disability as was pointed out in Atta v. Adu (supra). The depreciation of the cedi and the corresponding escalation of property values would make time undisputably an essential element.
I am drawn finally to respond to the criticism of harsh language allegedly indulged in by the trial judge, which it is claimed prejudiced an objective evaluation of the evidence. Where judges are faced with glaring injustice and the perpetration of fraud, they have been known to express themselves in the strongest language of condemnation. I give two examples. In Lubovsky v. Snelling [1944] K.B. 44, C.A. the defendant insurance company admitted liability but required a writ to be issued to ascertain quantum.
The writ was issued after the limitation period. The court held that the agreement constituted a contract not to plead the statute of limitations and the plaintiff was accordingly entitled to recover. Lord Justice
Scott at 46 characterised the defendant’s reliance on statute to defeat the claim, as “discreditable if not dishonest.” Justice Harman in Re Shepherd; Public Trustee v. Henderson [1948] 2 All E.R. 935 talked of absurdities which stink in the nostrils of the public. But what is rather offensive beyond redemption, is counsel’s insinuation that the trial judge lacked sobriety.
On the evidence, fraud was indeed practised and one cannot help but quote Lord MacNaghten in Reddaway v. Bonham [1896] A.C. 199 at 221:
“. . . fraud is infinite in variety; sometimes it is audacious and unblushing; sometimes it pays a sort of homage to virtue, and then it is modest and retiring; it would be honesty itself if it could only afford it. But fraud is fraud all the same, and it is the fraud, not the manner of it, which calls for the interposition of the Court.”
I have no doubt whatsoever that the trial judge arrived at the right conclusion on the evidence and her decision disallowing specific performance should be affirmed. I would consequently allow the appeal, set aside the orders of the Court of Appeal including the award of costs and restore the judgment of the trial court to the extent of dismissing the claim for specific performance.
Wuaku J.S.C. The plaintiff is the respondent to this appeal and the
defendant the appellant. The plaintiff originally sued three defendants but withdrew his action against the second and third defendants and continued the action against the first defendant alone. It would therefore be proper to regard the second and third defendants as not being parties to the suit despite the title of the suit. The plaintiff lost the action before the High Court, Accra presided over by Lutterodt J. (as she then was). The judgment of Lutterodt J. (as she then was) was reversed on appeal in favour of the plaintiff and the defendant appealed to this court against that reversal.
By his writ of summons, the plaintiff claimed:
“An order for specific performance ordering the defendants to execute a deed of assignment in favour of the plaintiff in respect of house No. 33/5, Onyaa Crescent, Nima Residential Area, Accra.”
In a fourteen-paragraph statement of claim that accompanied the writ of summons, the plaintiff averred in paragraphs (5), (6) and (7) as hereunder:
“(5) On or about 15 October 1976 the first defendant, the second defendant, one Ama Fofie, Yaw Achina and Joseph Achina all uterine relatives of the late E. K. Oduro offered for sale the deceased’s uncompleted building, house No. 33/5 Onyaa Crescent through an estate agent, Godwin Seshie Peters, for the sum of ¢75,000.
(6) The said offer was made in writing addressed to the plaintiff, the executive director of Eben’s Complex Agencies, P. O. Box 2354, dated 15 October 1976, and thumbprinted by the first defendant and witnessed by Joseph Achina.
(7) The plaintiff accepted the offer and paid the defendants as per receipt issued in his favour dated 2 June 1986 signed by Joseph Achina witnessed by the estate agent, G. S. Peters.”
It is necessary to reproduce also parts of the defence which I consider important. In this regard, I quote hereunder paragraph’s (4)(e), (f), (i), (j), (5) and (6):
“(4) (e) The plaintiff herein then entered into a tenancy agreement dated 10 November 1975 for a period of ten years with effect from 1 October 1978 at the monthly rent of ¢600 per month, that is to say with a “grace period” of three years
from 1 October 1975 to 1 October 1978, the rents for which period the plaintiff was to use to complete the said house and as stated hereunder.
(f) The first defendant says that during the negotiation which led to the making of the said tenancy agreement, and at which meeting the said contractor, the late Nyarko, was present he (the contractor) estimated and told the meeting that the cost of the work required to complete the said whole house was ¢24,000 which would be roughly three years’ rent payable on the said house, and the first defendant and his family agreed and granted to the plaintiff a three-year grace period, that is from 1 October 1975 to 1 October 1978 so as to enable the plaintiff to utilise or apply the said rents for the said house as agreed upon between the parties.
(i) Sometime in 1976 when the said Peters visited the first defendant and members of his family in Kumasi, the latter proposed to him (Peters) that owing to certain indebtedness on their Kumasi house, they had decided to sell the house to any interested purchaser; thereupon the said Peters said they (the first defendant and his family) should give the first option to the plaintiff who was already a tenant in the said house; and they agreed to do so; thereupon the said Peters made them write a formal offer letter dated 15 October 1976 through the said Peters to the plaintiff.
(j) The first defendant says that although they learnt from the said Peters that the plaintiff expressed interest in the said proposal of sale, yet he was unable to accept, and never accepted the said offer of sale and the said offer lapsed sometime in 1976; the plaintiff however continued to occupy the said house on the basis of the said tenancy agreement dated 10 November 1975.
(5) In specific answer to paragraph (7) of the statement of claim the first defendant says that the plaintiff obtained the signature of the said Joseph Achina onto the said document dated 2 June 1986, that is almost ten years after the said letter of offer dated 15 October 1976, by fraud and roguery which the plaintiff perpetrated on the said Joseph Achina.”
Paragraph (5) of the statement of defence has nine sub-paragraphs which give particulars of the said fraud which the plaintiff perpetrated on
the said Joseph Achina. Those sub-paragraphs give details of how the plaintiff was alleged to have forged the receipt which the plaintiff alleged in paragraph (7) of his statement of claim that Joseph Achina gave him. Paragraph (6) of the defence states:
“(6) The first defendant however asserts or contends that in any event the said forged or fraudulent documents which the plaintiff got the said Joseph Achina to sign by his (the plain- tiff ‘s) fraud, roguery and trickery, does not and cannot bind either the first or the second defendants herein in their said capacities as legal personal representatives of the late E. K. Oduro or bind the first defendant’s said matrilineal family. Again the plaintiff cannot use the processes of this honourable court as an engine of fraud.”
The defendant in paragraph (13) of his defence made a counterclaim and claimed four reliefs. To the defence and counterclaim, the plaintiff merely denied the reliefs claimed in paragraph (13)(a), (b), (c) and (d) of the defence followed by a general denial of the counterclaim.
I am of the opinion that in view of the serious allegations of fraud, roguery and trickery levelled against the plaintiff, the particulars of which were fully given, the plaintiff should have specifically denied those allegations or by way of confession and avoidance. Indeed, Order 19, r. 18 of the High Court (Civil Procedure) Rules, 1954 (L.N. 140A) provides that:
“18. It shall not be sufficient for a defendant in his defence to deny generally the grounds alleged by the statement of claim, or for a plaintiff in his reply to deny generally the grounds alleged in a defence by way of counterclaim but each party must deal specifically with each allegation of fact of which he does not admit the truth, except damages.”
The plaintiff did precisely what Order 19, r. 18 of L.N. 140A forbids and in his evidence-in-chief made no attempt to admit or deny the defendant’s allegation of a tenancy agreement; or deny even that of fraud.
He limited himself to his alleged purchase.
Perhaps it will be appropriate to refer to the salient parts of the plaintiff’s evidence-in-chief.
“The first defendant offered to sell this house to me at the time it was uncompleted. I accepted the offer . . . I paid for the house.
I paid ¢75,000 for it by means of a cheque and also to the building society to whom he (Oduro) was indebted . . . I was given a final receipt of payment by one Joseph Achina, the customary successor of the deceased.”
The plaintiff bases his claim on an offer for sale as evidenced by exhibit B. Exhibit B is a letter and it is thus:
“Kofi Fofie
P. O. Box 2107
Kumasi.
15 - 10 - 76
To:
The Executive Director
Eben’s Complex Agencies
Post Office Box 2354
Accra.
Dear Sir,
RE: HOUSE NO. 33/5, NIMA RESIDENTIAL AREA, ACCRA
I refer to our previous discussion on the above subject matter and to confirm that on behalf of my entire family, I am prepared to offer the house to you for sale.
The selling price is ¢75,000 only.
If this is acceptable to you, please confirm to enable us hold a meeting with your solicitor on the matter.
Hoping to hear from you soon.
Yours faithfully,
R.
T.
Kofi Fofie.
Witnessed (Sgd.) Joseph Achina
18/10/76.”
The plaintiff also tendered exhibits C, D, D1 -D3, E, F, G and H to support his allegation of purchase. He called Mr G. S. Peters, his only witness. Mr Kom has submitted that the combined effect of the receipts support the plaintiff’s claim of sale of the disputed house to the plaintiff and that the subsequent conduct of the parties to exhibit B were sufficient acts of part performance to entitle the plaintiff to a decree of specific performance.
The defendant says that the plaintiff was only a tenant as is evidenced in exhibit 1, the tenancy agreement, dated 10 November 1975. The defendant however admitted the offer made by him in exhibit B but says that the plaintiff never accepted that offer.
There are two grounds of appeal, namely:
“(a) That the judgment is against the weight of the evidence adduced.
(b) That the Court of Appeal erred very seriously in holding that there was ever any valid contract of sale or at all between the defendants’ family and the plaintiff.”
Lutterodt J. (as she then was) and the Court of Appeal held that exhibit B constituted a valid offer. There is no doubt that the two findings are correct. Lutterodt J. (as she then was) however held that there was no acceptance and therefore no contract of sale was entered into by the parties. The Court of Appeal held otherwise and that the offer was accepted by the plaintiff who had acted upon the acceptance.
My main task now is to find out which of the two courts came to the right conclusion. Was the offer accepted and communicated to the offer by the offeree? This is what Chitty on Contracts (22nd ed.), Vol. 1, para. 62, p. 30 says on acceptance in general:
“Two main rules govern the acceptance of an offer. The first is that there must be positive evidence from which the court may infer acceptance: this may consist in words, in writing or in conduct; it may not consist simply in intention, for a mere mental acceptance is not enough.”
See, eg. Brogden v. Metropolitan Railway Co. (1877) 2 App. Cas. 666 at 692, H.L. The second rule is that the acceptance must be communicated to the “offeror.” Where is the evidence of acceptance in this case? Was there any method prescribed by the offeror for the form the acceptance should take? In this case the offer was made by a letter, therefore one would have thought that the acceptance would be by a letter. Under
cross-examination this is what Joseph Achina who signed exhibit B as a witness and the second defendants witness in the proceedings said: “Q Does exhibit B say he must confirm in writing the acceptance? A Yes, my understanding is that he writes us back.” The plaintiff himself when cross-examined said:
“Q You never accepted the offer from the family?
A I did accept the offer.
Q How did you accept the offer?
A I accepted it by meeting the family and accepted it and we finalised the price.
Q Are you saying you agreed on the price after exhibit B has been written?
A Yes.”
The only witness called by the plaintiff was G. S. Peters who delivered exhibit B to the plaintiff. He said:
“I gave exhibit B to the plaintiff. The plaintiff had interest and accepted the offer.” And when he too was cross-examined, this was what happened:
“Q It is correct that the plaintiff merely showed interest in the offer, he did not accept the offer?
A Well, the letter was given to me. I sent it to him and he expressed interest. I do not know what happened thereafter.”
The evidence, if it proved anything at all, it was that it was only a mere mental acceptance; which on the authority of Brogden v. Metropolitan Railway Co. (supra) is not enough. I would have expected the witness to go back to Kumasi to inform the offeror of the offeree’s acceptance. I have no hesitation in saying that the acceptance was, if there was one, never communicated to the offeror. Exhibit B is clear on the face of it without any equivocation. Exhibit B states “if this is acceptable to you, please confirm to enable us hold a meeting with your solicitor on the matter. Hoping to hear from you soon.” Had the plaintiff accepted the offer, the follow up, in my view, would be of two things: (1) the plaintiff would communicate with the defendant to confirm his acceptance; and (2) they would meet the plaintiff’s solicitor on the matter as prescribed in the offer. The meeting that the plaintiff said he had with the family was in 1981 at Nsawam, and had nothing to do with exhibit B.
The defendant is an illiterate farmer and had been blind for 20 years at the time he gave evidence. He is the successor and one of the
administrators of the estate of his late senior brother, E. K. Oduro. The evidence disclosed that the deceased left behind the uncompleted two-storey building which one Nyarko, a contractor, was building for the deceased. Nyarko had estimated that ¢24,000 would be required to complete putting up the building.
The defendant’s case is that through G. S. Peters, an estate agent, who is the plaintiff’s only witness, his family represented by Joseph Achina, let the disputed premises to the plaintiff. A lease agreement, exhibit 1, was entered into on 10 November 1975. The plaintiff immediately entered and took possession of the premises. The lease was for a term of 10 years to start from 1 October 1978, for which three years advance rent was paid to begin on the commencement of the lease on 1 October 1978. The plaintiff was to pay no rent for the years beginning 1 November 1975 to 1 October 1978, which was termed as a “grace period of three years.” According to the defendant, during the “grace period of three years”, the plaintiff was to collect the rents and to use the rents so collected to complete the building. The rents to be collected during the “grace period of three years” would amount to almost the estimated ¢24,000 which would be needed to complete the building.
The state of the building when the plaintiff was let into possession was described by G. S. Peters as follows:
“It is a three-storey building. Ground floor was fully completed with four bedrooms, hall, dining hall, amenities including garage. The first floor has structures and fittings of door and window frames all completed, remaining wiring and painting. The second floor has not been constructed at all. We have only the structures.”
In my opinion, the conditions as above described could easily fetch rent of ¢600 per mensem if not more.
It is a fact that the plaintiff was collecting rents from tenants like Kludjeson and Aikins Enterprises.
Following the witness’ description of the building, he was asked the following question: “Q What was the plaintiff to use the rent for this grace period for?” The witness must have known why the question was asked; he therefore gave this evasive answer; “A That was not the agreement. He had already paid advance to the family but the landlord did not repair the house so the plaintiff took it upon himself to repair the house.” It must be noted that the issue brought out by the evidence was who was to complete the uncompleted building and not who was to repair it. The cross-examination of the witness continued:
“Q One Nyarko introduced you to Fofie and his family?
A Yes.
Q What the defendant told you was, they wanted a tenant to take possession of the house as a tenant and use part of the proceeds to complete the house and reimburse himself from the rents accruing?
A Yes, Kofi Fofie told me this.
Q Nyarko was the contractor who put up the building?
A Yes.
Q The contractor estimated the cost of the work needed to complete the house at ¢24,000?
A Yes ...
Q From 10 November 1975—1 October 1978 the rents to accrue within this period, they were not paid to the defendant by the plaintiff ?
A They were not paid.
Q The plaintiff was to use those rents for the work on the house?
A Yes.”
Exhibit 1 was silent on the duties of the parties between 10 November 1975 to 1 October 1978. It would be seen that the witness had not only provided the clue but had also confirmed the version of the defendant. And to counteract the damaging evidence, the plaintiff tendered through the second witness for the defendant, exhibit H which is as follows:
“Dapaah Brothers Ltd.
General Merchants and Importers
Telephone 375 P. O. Box 2107
Residence 3755 Kumasi - Ashanti
Ghana.
Directors
Kofi Fofie (Manager)
Kwasi Owusu 7 October 1975
Bankers
Ghana Commercial Bank
11 Road Kumasi
Mr. G. S. Peters
O. Box 5467
Tel. No. 27540
Accra.
Dear Sir,
With reference to our discussion in connection of hiring my uncompleted two-storey building in Accra, the rental fee of ¢600 per month, I have agreed to your offer and you are requested to pay an advance of rent for a period of 3 years for the completion of the building.
That the work on the building will be started immediately you pay the advance to enable you live in the house without delay.
Hoping to hear from you favourably.
Yours sincerely
(Sgd.) (Joseph Achinah)
For: Dapaah Brothers Ltd.
W/W to sign:-
LIC No. 65849 Ksi/75
Ntornia Road, Adum
Kumasi.”
Exhibit H was a letter written by Dapaah Brothers Ltd., a limited liability company, and addressed to Mr S. Peters. The letter speaks for itself. It was a letter accepting an offer made by G. S. Peters. The letter in my view had nothing to do with the plaintiff and the defendant. Exhibit H was signed by Joseph Akyina on behalf of Dapaah Brothers Ltd. Exhibit H was not recited in, or referred to in exhibit 1. It is a principle of law that a company is an independent legal person: see Salomon v. Salomon & Co. [1897] A.C. 22, H.L.. A letter written by Dapaah Brothers Ltd. to G. S. Peters was not in law a letter written by either the defendant, Kofi Fofie, or Joseph Akyina.
The plaintiff is not claiming that there was a tenancy agreement between Dapaah Brothers Ltd. and G. S. Peters, and that G. S. Peters had assigned the remainder of the tenancy agreement to him and therefore he, the plaintiff, is entitled to the benefit of the covenant under the said tenancy agreement.
There is the question of payment. Various forms of calculations and
additions were employed to arrive at the figure of ¢75,000 more or less, to be the purchase price. Mr
Kom, learned counsel for the plaintiff, had submitted that ¢75,000 was the selling price of the house and
the amount paid by the plaintiff. He arrived at the figure of ¢75,000 in this way:
“(i) As per exhibit 1 ¢21,600
(ii) First Ghana Building Society ¢29,037.34
(iii) To Achina as per exhibit E ¢24,362.66
¢75,000.00”
Learned counsel explains the payment to First Ghana Building Society in a marginal note that the original loan as per exhibits D2 and D3 was ¢15,000. Mr Kom however did not explain how that amount became ¢29,037.34.
Lutterodt J. (as she then was) accepted the ¢75,000 and held that it was for payment in furtherance of rents and not the purchase price. The Court of Appeal on the other hand arrived at the figure of ¢99,000 and held that it was the total “payments” made and the amount spent in completing the house by the plaintiff.” The ¢99,000 include the estimate of ¢24,000 which was in fact not money paid and the ¢29,037.34 allegedly paid to the First Ghana Building Society. It will be shown in the course of this judgment that the plaintiff himself said that it was a lesser sum that he paid to the said First Ghana Building Society.
The ¢21,600 was clearly rent advance for the three years beginning from 1 October 1978, qv exhibit 1.
The defendant pleaded it, the plaintiff never specifically denied it in his reply. The plaintiff was very clear and precise as to payments which he regarded as payments towards the purchase price. We have to look again at his evidence-in-chief and under cross-examination. First the evidence-in-chief: “I paid ¢75,000 for it by means of a cheque and also to the building society to whom he, Oduro, was indebted.” And in cross-examination:
“Q You know the total indebtedness of the first defendant to the bank was only ¢16,000?
A Yes, it was inclusive of interest.
Q You did not pay directly to the bank?
A I paid.
Q These payments were part of the rent for the ten years period under exhibit 1 ?
A Yes, I agree.”
The subsequent questions and answers show that the bank mentioned is referring to the building society.
If the plaintiff is to be believed then the payments which he made towards the purchase price were payments he made by a cheque, and also to the building society. The only payment made by a cheque and supported by oral and documentary evidence was for ¢23,000. The withdrawn cheque was tendered attached to exhibit E. It bore the date 2 June 1986 and serial number H/OB/10379753. An amount of ¢1,362.66 cash was added to the ¢23,000 to make the ¢24,362.66 covered by the receipt, exhibit E. On the plaintiff’s own evidence he paid ¢24,362.66 plus the amount he paid to the First Ghana Building Society which was ¢16,000 as moneys paid as the purchase price.
Exhibit E reads:
“RECEIPT
FOR FINAL PURCHASE PRICE PAYMENT H/NO.33/5
ONYAA CRESCENT, NIMA RESIDENTIAL, ACCRA.
I, the undersigned Joseph Achina of P. O. Box 2107, Kumasi have received the amount of ¢24,362.66 made up of cheque No. H/OB/10379753 for ¢23,000 and cash of ¢1,362.66 from Mr E. T. Zanyoh of Accra, being settlement of balance outstanding in full and final payment for my house No. 33/5, Onyaa Crescent, Nima Residential Area off Ring Road Central, Accra.
Total purchase price paid ¢75,000.
Dated this 2 day of June 1986 at Accra.
(Sgd.) (JOSEPH ACHINA)
Witness to signature or mark
Sgd. G. S. PETERS.”
This is the receipt which the plaintiff alleges is the evidence of his having bought and paid for the house. It is the receipt that the defendant had pleaded was forged by the plaintiff.
Joseph Achina who signed exhibit E was the second witness for the defendant. He stated that in 1986 they came to Accra to collect the rent due to them calculated to be ¢24,362.66. The plaintiff gave him cash in the sum of ¢1,362.66 and took him to the Social Security Bank, where the plaintiff withdrew ¢23,000 which was given to him in addition to the ¢1,362.66. Joseph Achina said that it was the plaintiff who prepared the
receipt; the plaintiff too said that it was Joseph Achina who prepared it. Joseph Achina said that he signed the receipt in the absence of G. S. Peters. It is admitted that G. S. Peters signed the receipt sometime later in the absence of Joseph Achina. Joseph Achina said that the plaintiff refused to give him a copy of the receipt but promised to post one to him. A year later, in 1987, the plaintiff sent him a telegram to come to Accra. When he came, the plaintiff asked him whether he, Joseph Achina, knew that he had sold the house to him. He, Joseph Achina, denied selling the house. The plaintiff showed him the receipt and upon examining it, he saw G. S. Peters’, signature on it and also inserted on the receipt the following words: “FOR FINAL PURCHASE PRICE PAYMENT HOUSE NO.33/5, ONYAA CRESCENT, NIMA RESIDENTIAL AREA, ACCRA.” and also. “Total purchase price paid ¢75,000 (Seventy-Five thousand cedis).”
The trial judge held that the words complained of were inserted by the plaintiff in the absence of Joseph Achina and were inserted fraudulently. The Court of Appeal too held that the words were inserted by the plaintiff in the absence of Joseph Achina but found no fraudulent intent by the plaintiff. I agree with the trial judge that it was a gigantic fraud perpetrated by the plaintiff on the defendant and his family and it cannot be allowed to stand. I will say that the plaintiff carefully planned the fraud which he executed, otherwise the words in question could not be so easily typed subsequently into the receipt. I think the maxim fraud omnia vitiate applies to the plaintiff’s conduct. It runs counter to reason that the defendant would allow the plaintiff to occupy the disputed house for a grace period of three years for no consideration but rather to collect rents which he did not account to the defendant.
I have carefully examined the judgments of the High Court and that of the Court of Appeal, and I am of the view that the Court of Appeal made many unfounded and uncalled for attacks and criticisms on the trial judge. Take for example the following statement in the Court of Appeal judgment:
“The plaintiff pleaded and testified in court that it was he who completed the uncompleted building together with building and adding a boys’ quarters at a cost of ¢5 million. The first defendant did not put the plaintiff to strict proof of this serious statement. He was therefore bound to that statement ... clearly and plainly the trial judge failed and/or omitted to discover that the statement made by the plaintiff that he spent the colossal sum of ¢5 million in completing the undertaking was not challenged
nor disputed by the first defendant. . . .”
What the plaintiff pleaded, with regard to the ¢5 million was:
“(11) The plaintiff says that consequent upon the sale agreement he spent not less than ¢5 million in completion of the house and the plaintiff is now operating a hotel in the house known and called EMPEROR HOTEL.”
All that the plaintiff said in proof of the above quoted averment is this. “I have spent about 5 million cedis to complete the house. I am using the house to run a hotel. The hotel is known as Emperor Hotel.”
Contrary to the Court of Appeal’s assertions, this is what the defendant pleaded in paragraph (8) of the defence:
“(8) The first defendant therefore vehemently denies paragraph (11) of the statement of claim and says that the plaintiff has never spent either the amount of ¢5 million or any money of his own, on this (the first defendant’s family) said house. Indeed the plaintiff was under a duty, in terms of the said tenancy agreement to have long completed the said house within the three-year period from 1975 to 1978 when he was to have used the rents accruing from the said house to complete the said house but the plaintiff failed to do so.”
(The emphasis is mine.)
Since the ¢5 million was made a specific issue for trial, the plaintiff should have led cogent evidence in proof of this particular averment by him. He failed to prove it and the defendant need not be called upon even to give evidence in rebuttal. The trial judge never made any finding that the plaintiff spent the “colossal” sum of ¢5 million in completing the undertaking nor did the plaintiff himself say he spent a “colossal” sum of ¢5 million. All that the learned trial judge did in my view was to use the adjective “colossal” to qualify not less than ¢5 million or about ¢5 million which the plaintiff alleged he spent on the house, and if the plaintiff indeed spent any amount of that magnitude he should have offered a better proof than simply saying I spent about ¢5 million. Whether or not the plaintiff spent not less than ¢5 million in the completion of the house was issue “e” in the summons for directions to be resolved. That issue was not resolved by the plaintiff by just saying I have spent about ¢5 million to complete the house.
Thus the learned trial judge’s holding that the burden was on the plaintiff to show that he
spent as much as he claimed was right. The learned judge’s reliance on Majolagbe v. Larbi [1959] G.L.R. 190 at 192 was apposite to the case before her.
Another unfortunate attack on the trial judge is the allegation that she made an unwarranted statement that the family of the first defendant leased the property to the plaintiff and therefore she erred in her judgment. The learned judge never said anything of the sort. What she said but was wrongly quoted was “In 1975 the family leased . . .” The plaintiff himself said so: “Peters is the estate agent who put me into contact with the family whose property I have purchased.” The learned judge held that the property was leased and not purchased. The plaintiff said that the defendant is the head of the deceased’s family and one of the administrators of the deceased’s estate. It was Joseph Achina who signed the lease, exhibit 1, as landlord and also forged the receipt, exhibit B, but it was the defendant that was sued. It would in my opinion be proper had the trial judge indeed said the first defendant’s family.
There is the controversy whether the offer had lapsed or not, in other words, whether time was of the essence and therefore the plaintiff had a limited time within which to accept the offer made in exhibit B. There is a difference between the sale of vacant land simpliciter, as for example in the case of Williams v. Greatrex [1957] 1 W.L.R. 31, C.A. where time was held not of the essence; and commercial transactions, such as business premises, where time must be of the essence. In this case, apart from the plaintiff being a tenant (running a hotel), there were also Kludjeson and Aikins Enterprises as tenants. See also Mills v. Haywood (1877) 6 Ch.D. 196, C.A.
The notion that the possession which has been continued by the plaintiff is to be referred to the lease agreement, exhibit 1, or exhibit H, is, in my opinion, wholly without foundation, and is contradicted by the plain facts of the case, and, as said earlier on in this my judgment, not even asserted by the plaintiff in his statement of claim, reply or defence to the defendant’s counterclaim. It sounds absurd that the defendant would agree to wait for ten years to receive the purchase money which is almost equal to the same amount he would have received under the lease for the same period.
Had it been the plaintiff’s case that he was a lessee with the right or option of renewal to be exercised within a prescribed period and he failed to exercise the option within the prescribed time and continued to hold in the same agreement as a tenant, delay will not be fatal to his right to exercise the option, and equity will come to his aid: see Shepheard v