BOOHENE FOODS LTD. vs. NATIONAL SAVINGS AND CREDIT BANK AND ANOTHER [1989]DLHC1993

Date	1989-04-17
Suit No.
Citation No.	[1989]DLHC1993

BROBBEY J.

KOI LARBI FOR THE PLAINTIFFS.

OKWABI FOR THE FIRST DEFENDANTS.

[1989]DLHC1993
																																						<div class="restriction-wrapper">
														<div class="container-lg">
															<div class="row">
																<div class="col-md-12 restricted-content">
																	<div class="restricted-content-img-wrapper">
																		<div class="lock-icon bounce-7">
																			<img class=""
																				src="https://www.dennislawgh.com/dl-assets/dl-images/lock-content.png"
																				alt="Subscription based content">
																		</div>
																	</div>
																	 
																		<a href="https://www.dennislawgh.com/login"
																		class="btn btn-primary btn-lg"
																		style="font-family: 'open sans'; text-transform: capitalize; border-radius: 8px"> 
																		Login to Read Full Case </a>
																	 
																	
																</div>
															</div>
														</div>
													</div>
													<main id="main" class="content" style="min-height: 60rem" ><span style="font-size:12.0pt;line-height:115%;font-family:&quot;Book Antiqua&quot;,&quot;serif&quot;;
mso-fareast-font-family:&quot;Book Antiqua&quot;;mso-bidi-font-family:&quot;Book Antiqua&quot;;
color:#00B0F0">BOOHENE FOODS LTD.<o:p></o:p><span style="font-size:12.0pt;line-height:115%;font-family:&quot;Book Antiqua&quot;,&quot;serif&quot;;
mso-fareast-font-family:&quot;Book Antiqua&quot;;mso-bidi-font-family:&quot;Book Antiqua&quot;;
color:#00B0F0">vs.<o:p></o:p><span style="font-size:12.0pt;line-height:115%;font-family:&quot;Book Antiqua&quot;,&quot;serif&quot;;
mso-fareast-font-family:&quot;Book Antiqua&quot;;mso-bidi-font-family:&quot;Book Antiqua&quot;;
color:#00B0F0">NATIONAL SAVINGS AND CREDIT BANK AND ANOTHER<o:p></o:p>[HIGH COURT, ACCRA]<o:p></o:p>[1992] 1 GLR 175<o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
padding:0in 0in 1.0pt 0in">

<p class="MsoNormal" align="right" style="margin-bottom:5.0pt;text-align:right;
mso-pagination:none;border:none;mso-border-bottom-alt:solid windowtext 1.5pt;
padding:0in;mso-padding-alt:0in 0in 1.0pt 0in">Date: 17 APRIL
1989<o:p></o:p>

</div>COUNSEL:<o:p></o:p>KOI LARBI FOR THE PLAINTIFFS.<o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
padding:0in 0in 1.0pt 0in">

OKWABI FOR THE FIRST DEFENDANTS. <o:p></o:p>

</div>JUDGMENT OF BROBBEY J.<o:p></o:p>The facts which resulted in this case are as follows: The second
defendant company offered to buy rice from the plaintiff company by presenting
a post-dated cheque in payment thereof. The plaintiff company declined to sell
the rice against that post-dated cheque. The second defendant represented the
same cheque, but this time with a guarantee written at the back. On the basis
of that guarantee, the cheque was accepted by the plaintiff’s and the rice
valued at ¢5 million was supplied to the second defendant. The cheque was
tendered as exhibit A. The exact words of the guarantee which induced the
plaintiffs to accept the cheque were “payment guaranteed.” Below those words
appeared the signature of one S.O. Addo, who signed in his capacity as the
accountant of the Tema branch of the National Savings and Credit Bank
(hereafter referred to as the first defendants). The cheque did not merely bear
the signature of the accountant but also had on it the official stamp of the
accountant of the branch bank. The cheque was dated 25 October 1987. From the
tenor of the evidence of the witnesses who testified on behalf of the
plaintiffs, the rice was supplied after the cheque had been indorsed.<o:p></o:p>When the plaintiffs presented the cheque for payment, the bank
whose accountant wrote the guarantee on the cheque, namely the first
defendants, dishonoured it. The plaintiffs consequently issued a writ claiming:<o:p></o:p><p class="MsoNormalCxSpMiddle" style="margin-left:.5in;mso-add-space:auto;
text-align:justify;text-indent:-.25in;mso-pagination:none;mso-list:l0 level1 lfo1;
border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:yes">(a).&nbsp; ¢5 million accruing thereof; \<o:p></o:p><p class="MsoNormalCxSpMiddle" style="margin-left:.5in;mso-add-space:auto;
text-align:justify;text-indent:-.25in;mso-pagination:none;mso-list:l0 level1 lfo1;
border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:yes">(b).&nbsp; 331⁄2 per cent interest from
the period that the amount has been outstanding; <o:p></o:p><p class="MsoNormalCxSpMiddle" style="margin-left:.5in;mso-add-space:auto;
text-align:justify;text-indent:-.25in;mso-pagination:none;mso-list:l0 level1 lfo1;
border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;mso-border-shadow:yes">(c).&nbsp; ¢1 million special damages;
and <o:p></o:p><p class="MsoNormalCxSpMiddle" style="margin-top:0in;margin-right:0in;margin-bottom:
5.0pt;margin-left:.5in;mso-add-space:auto;text-align:justify;text-indent:-.25in;
mso-pagination:none;mso-list:l0 level1 lfo1;border:none;mso-padding-alt:31.0pt 31.0pt 31.0pt 31.0pt;
mso-border-shadow:yes">(d).
general damages.”<o:p></o:p>The first defendants refused to pay on the face of the cheque for
four main reasons. First, they contended that the accountant who wrote the
guarantee on the cheque had no mandate to commit the bank because he was a B signatory.
Secondly, the guarantee written on the back of the cheque did not conform to
the format in which guarantees were ordinarily given by the first
defendant-bank. Thirdly, since the accountant knew that he had no mandate to
commit the bank up to ¢5 million and further that his action was not in
accordance with the written instructions in the bank, what he wrote was not
merely unauthorised but also fraudulent and could not bind the bank. Finally,
they contended that the plaintiffs had notice of the irregularity of the
mandate and so the plaintiffs took a chance by not verifying from the manager
himself before presenting the cheque for payment.<o:p></o:p>When pleadings closed, the summons for directions filed on behalf
of the plaintiffs was a shallow one which glossed over a number of important
issues. The sole issue filed was: “Whether the first defendants are obliged to
pay ¢5 million on the basis of the guarantee indorsed on the second defendant’s
cheque.” On behalf of the defendants w</main>