AFRICAN EUROPEAN TEXTILES LIMITED vs. GHANA COMMERCIAL BANK LTD.

The Respondent company secured a medium-term loan and a revolving short-term loan from the Appellant Bank to complete a spinning factory under the government's One District One Factory programme. Disbursement was stalled due to a dispute between the two directors of the Respondent company, whose joint signatures were required for disbursement. One director refused to sign due to a police case against him by the other director. The Bank refused to disburse funds without both signatures, leading the Respondent to seek a court order to compel disbursement upon the sole signature of the director in Ghana. The trial court granted the order, but the Bank later applied to set it aside, arguing the procedure was improper. The lower court refused to set aside the order, prompting this appeal.

JUDGMENT KWAMINA BAIDEN, JA: This appeal arose out of an application made by the Applicant/Respondent/Respondent hereafter referred to as the Respondent against the Respondent/Applicant/Appellant hereafter referred to as the Appellant for the disbursement of money under a credit facility with the Appellant Bank. The Respondent secured a medium-Term loan of USD1,180,899.95 from the Appellant Bank for the completion of a spinning factory, interior design and purchase of auxiliary equipment. The term of the loan was 60 months. There was also a revolving short-term loan of USD333,251.57 granted to augment the working capital of the Respondent company. This was for a 12- month duration. The goal of the Respondent Company in securing the loans was that it was part of the then flagship programme of the government namely the One District One Factory (1D1F) Programme and it required the loan to meet the conditions of the government’s industrialization policy under the programme. The R.....