[2015]DLCA3141 • May 7, 2015 • Court of Appeal
JESCAN CONSTRUCTION LTD. vs. HIPPO LIMITED AND OTHERS
Jescan Construction Ltd was contracted by Hippo Limited to construct two warehouses and other facilities valued at GH¢4,000,000. The contract required advance payment guarantees and performance securities issued by Merchant Bank. The project was terminated for non-performance and the project manager certified that Jescan owed Hippo GH¢300,705.83. Hippo called on the bank to pay this sum under the guarantees. Jescan sued for an injunction to restrain Hippo from calling on the guarantees. Hippo filed a defence and counterclaim including claims against the bank to enforce the guarantees.
read moreTORKORNOO, J. A: This is an appeal against a ruling dismissing an application for summary judgment against Merchant Bank (referred to as the Bank hereinafter). The Plaintiff Respondent (referred to as Respondent hereinafter) in this appeal was employed as a contractor to construct two warehouses and other facilities in two lots for the 1st Defendant /Counterclaimant/Appellant (Appellant) valued at a total figure of GH¢4,000,000.00. The contract period for the warehouses and other facilities was September 2011 to March 2012 and September 2011 to January 2012 respectively. The contract required that the contractor provide advance payment guarantees for mobilization payments given to the contractor. The contractor was also to provide performance securities for the due execution of the contracts. Two advance payment guarantees were issued by the Bank on 5th September 2011 in support of the Contractor. These guarantees were in the sums of GH¢227,317.93 and GH¢468,682.07 respectively ...