AGRICULTURAL DEVELOPMENT BANK vs. SEIDU [1993]DLCA4315

Date	1993-05-27
Suit No.	[1992-93] 2 G B R 814 – 833
Citation No.	[1993]DLCA4315

AMPIAH JSC

ESSIEM JA

FORSTER JA

SAKA (MRS) FOR THE APPELLANTS.

MUMUNI FOR THE RESPONDENT.

[1993]DLCA4315
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													<main id="main" class="content" style="min-height: 60rem" >AGRICULTURAL DEVELOPMENT
BANK<o:p></o:p>vs.<o:p></o:p>SEIDU<o:p></o:p>[COURT
OF APPEAL, TAMALE]<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">

[1992-93] 2 G B R 814 – 833&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; DATE: 27 MAY 1993<o:p></o:p>

</div>COUNSEL:<o:p></o:p>SAKA
(MRS) FOR THE APPELLANTS.<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">

MUMUNI
FOR THE RESPONDENT.<o:p></o:p>

</div>CORAM:<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">

</div>AMPIAH
JSC. This is an appeal from the decision of the High Court, Tamale. On 8 May
1986 the plaintiff took action against the defendant claiming:<o:p></o:p>“(a) Declaration of title to
Massey-Ferguson tractor with registration number ARA 8546 together with its
plough, trailer and harrow.<o:p></o:p>(b) Recovery of possession of the said
tractor, plough, harrow and trailer.<o:p></o:p>(c) A declaration that the seizure of
the said tractor, plough, harrow and trailer by the defendants on 20 January
1986 is wrongful.<o:p></o:p>(d) General and special damages for
detinue.<o:p></o:p>(e) An order of perpetual injunction
restraining the defendants either by their assigns, agents and or servants or
whomsoever otherwise from interfering with the ownership and possession of
plaintiff’s tractor No ARA 8546.”<o:p></o:p>The
defendant resisted the claim. On 16 September 1988 judgment was given for the
plaintiff. He was awarded a total of ¢2,175,000 damages, inclusive of costs.
Against this decision the defendant has appealed.<o:p></o:p>The
defendant (hereinafter referred to simply as “the bank”) filed a number of
grounds in this appeal. After hearing both counsel in the appeal, it became
obvious however, that the success or otherwise of the appeal depended upon the
interpretation of section 13(4) of the Agricultural Development Bank Act 1965
(Act 286) as amended. This section provides:<o:p></o:p>“13(4) Notwithstanding anything
contained in any other law for the time being in force, any charge created on
any property to secure the repayment of a loan granted by the bank, or to
secure the performance of the stipulations of any bond executed in favour of
the bank, shall be enforceable against such property in the hands of any person
to whom it may have been transferred; including the person who has acquired the
property for consideration and without notice of the charge.”<o:p></o:p>There
cannot be any dispute that the transaction culminating in the execution of
exhibit 1, the assignment, created a charge on the tractor and its accessories
procured by Orlando Alhassan Yakubu, trading under the business name of Orlando
Alhassan Yakubu and Co, within the meaning of section 13(4) of Act 286. The
judge also found quite correctly, in my view, that the plaintiff was a
purchaser for value without notice of the charge.<o:p></o:p>On
the face of these findings if it was found that exhibit 1 (the assignment) was
still subsisting, the plaintiff could not claim any title to the tractor and
its accessories.<o:p></o:p>It
has been contended in this appeal by the plaintiff that the assignment, exh 1,
creating the charge had lapsed and that in the circumstances he was not
affected by the statutory provisions of section 13(4) of Act 286 and that
consequently, as a bona fide purchaser for value without notice, he was
entitled to the tractor and its accessories at the time they were seized.<o:p></o:p>To
appreciate the plaintiff’s point, it would be necessary to state briefly his
case. According to him, he had purchased the tractor and its accessories from
one Orlando Alhassan Yakubu for ¢640,000 some time in August 1984. He said, on
20 January 1986 while this tractor and its accessories were in his possession,
the bank seized and sold them on the ground that Orlando Alhassan Yakubu and Co
had purchased the items with a loan of ¢450,000 granted it by the bank and that
there was an agreement whereby the items had been assigned to the bank as
security for the repayment of the loan and interests thereon. The bank
contended further that since Orlando Alhassan Yakubu had defaulted in the
repayment of the loan and interest, the bank had exercised its rights under the
agreement to seize and sell the items and that although the plaintiff might be
a purchaser for value without notice of the charge, under section 13(4) of Act
286, his (the plaintiff’s) status as such could not avail him.<o:p></o:p>The
most important question then is: was the assignment, exhibit 1, still operative
at the time the items were seized? It had been submitted by counsel for the
bank that as long as Orlando Alhassan Yakubu’s indebtedness to it remained
unsettled, the items remained “charged” and that no purchaser, be he a
purchaser for value without notice or not, could have any title in the items.
Counsel seemed to be saying that once an assignment always an assignment.<o:p></o:p>I
do not seem to share this view. The repayment of the loan together with the
accrued interests were to be effected within 2 years and if not repaid within
this period, the bank was entitled to exercise its rights under the assignment.
Although I do not agree with the trial judge that the agreement came to an end
after the two years, I think the assignee (the bank) was entitled then to take
steps to enforce the terms of the assignment and this was to be done within a
reasonable time after the date for the repayment had lapsed. The exercise of
any of the rights under the assignment may be barred by time. Similarly, I
think any waiver or variations in the terms under the assignment may have to be
documented in a fresh agreement (assignment) as failure to do so may lead to
the loss of the assignee’s rights under the original assignment.<o:p></o:p>By
the terms of the assignment, exhibit 1, the bank was to seize and sell the
tractor together with its accessories whenever there was failure of the
assi</main>