[2008]DLCA6542 • June 12, 2008 • Court of Appeal
NDK FINANCIAL SERVICES LTD. vs. JOGIS LIMITED AND 2 OTHERS
The respondent, a licensed nonbanking financial institution, granted multiple short-term loan facilities to the appellant, an estate development company, between December 2001 and July 2005. The appellants defaulted on repayments, resulting in an indebtedness of approximately ¢2.33 billion as of May 2006. The appellants acknowledged the loans but contended that the terms, particularly the interest rates and compounding, were harsh, unconscionable, and in breach of the Loans Recovery Ordinance 1918 CAP.175. The respondents reduced the interest rate from 6.5% to 6% per 30-day month during the proceedings. The appellants sought a declaration that the interest charged was excessive and requested the court to reopen the transaction for equitable adjustment.
read moreQUAYE, J.A. The pleadings in this case and the evidence led in the trial court as well, showed that the respondent herein are a registered and licensed non-banking financial institution engaged in lending money on short term basis to the business community in Ghana. The 1st defendant/appellant is an incorporated estate development company. Between the period dating from December, 2001 to July 2005, the respondent and the appellant entered into agreements by which the respondents granted loan facilities to the appellants. According to the respondents, the appellants defaulted or failed to liquidate the debts thus accrued, to the extent that as at 4th May, 2006 the appellants’ indebtedness to the respondents stood at ¢2.334,849,269.00; that is to say two billion, three hundred and thirty four million, eight hundred and forty-nine thousand two hundred and sixty-nine cedis only. Pleadings were exchanged, issues were joined, and the defendants/appellants filed a counter-claim. The re...