ADOMAKO vs. APPENTENG [1994]DLCA5200

Date	1994-01-27
Suit No.	[1994 - 95] 2 G B R 936 – 942 C A
Citation No.	[1994]DLCA5200

BROBBEY JA

ESSIEM JA

ADJABENG JA

E D KOM FOR THE APPELLANT.

KOJO AFRAM ASIEDU FOR OFOSU AMMAH FOR THE RESPONDENT.

[1994]DLCA5200
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													<main id="main" class="content" style="min-height: 60rem" >ADOMAKO<o:p></o:p>vs.<o:p></o:p>APPENTENG<o:p></o:p>[COURT
OF APPEAL]<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">

[1994 - 95] 2 G B R 936 – 942&nbsp; C A&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 JANUARY 1994<o:p></o:p>

KOJO
AFRAM ASIEDU FOR OFOSU AMMAH 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">

BROBBEY
JA, ESSIEM JA, ADJABENG JA<o:p></o:p>

</div>BROBBEY JA. <o:p></o:p>The
plaintiff averred that he set up a company by name Vacuum Salt Products
Limited. Following some discussion with the defendant, the plaintiff allotted
one hundred thousand shares in that company to the defendant on the express
understanding that the defendant would hold the shares in trust for the
plaintiff. That was in 1975. The plaintiff stated further in his affidavit
filed on 12 November 1992 that when dividends were declared in 1981 he
authorised the defendant to hold the amount in trust for him, the plaintiff.
The defendant refused later to pay the 1981 dividends to plaintiff. The
plaintiff therefore stopped payment of the 1983 dividends to the defendant.
Consequent upon certain Government actions taken in connection with the company
in 1989, the plaintiff stopped further attempts to pay dividends to defendant.
He also attempted to end the trust by a letter dated 28 April 1992. When the
dividends were not refunded to the plaintiff, he instituted action against the
defendant claiming three reliefs, namely:<o:p></o:p>(1)
A declaration that the appellant held 100,000 shares of the company in trust
for him;<o:p></o:p>(2)
An order for the defendant to transfer the shares to him;<o:p></o:p>(3)
Accounts of all dividends and profits arising from the shares.<o:p></o:p>Before
the action could proceed to a hearing, the defendant’s counsel filed a motion
under Or 12 r 24 of the High Court (Civil Procedure Rules) 1954 LN 140A to set
aside the writ of summons on the sole ground that the action was
statute-barred. While arguing the motion in the High Court, counsel for the
defendant contended further that the writ disclosed no cause of action. The
trial judge dismissed the motion. It was against that dismissal that the
defendant appealed to this court. In this court also, counsel for the appellant
argued the two points he canvassed before the trial court on want of cause of
action and the statutory limitation on the plaintiff's action.<o:p></o:p>Throughout
the pleadings and the proceedings before the High Court and this court, the
appellant never denied that the plaintiff created a trust with him as the
settlor and sole beneficiary and the respondent as the trustee. Mr Kom who
appeared for the appellant argued that 1975 was when the cause of action arose.
That could not be correct; 1975 was the year when the trust was created.
Dividends were not declared until 1981. The bone of contention however revolves
around the person who should be paid the dividends.<o:p></o:p>The
respondent alleged that he had agreed with the appellant for the latter to keep
the dividends as additional allowance in his capacity as chairman of that
company. That also has not been denied by the appellant. Apparently, that was
the state of affairs until dividends were actually paid to appellant in 1991 as
evidenced by a letter marked exhibit D1. To my mind that seems to explain why
the respondent did nothing about the dividends with appellant but revived the
issue on the payment of dividends in 1991 when the appellant was actually paid
the dividends and he declined to pay same to the respondent.<o:p></o:p>Since
the appellant conceded that a trust was created, making him only a trustee, he
knew that he only had legal title to the dividends and the respondent, as the
sole beneficiary and holder of equitable interest, was entitled to be paid the
moneys. The continued retention of the dividends by the appellant clearly
amounted to conversion of those dividends.<o:p></o:p>Counsel
for the appellant based his arguments substantially on the provisions of the
Limitation Decree 1972 NRCD 54 under which he submitted that the respondent's
action was statute barred since the dividends were declared in 1981 and 1983.
Section 15(1) of NRCD 54 limits an action to recover trust money to six years.
It provides that:<o:p></o:p>“15(1) Subject to subsection (4) of
this section, an action to recover money or other property or in respect of any
breach of trust, not being an action for which a period of limitation is fixed
by any other provision of this Decree, shall not be brought against a trustee or
any person claiming through him after the expiration of six years from the date
on which the right of action accrued.”<o:p></o:p>The
issue raised by the respondent’s writ concerned payment of the dividends, not a
mere declaration of them. Dividends were declared in 1981 and 1983 but were not
paid until 1991. The writ was filed in September 1992. It could not therefore
be caught by the six-year statute bar.<o:p></o:p>In
my view the most contentious issue relates to section 15 of NRCD 54. Counsel
for the appellant contented that the parties based their respective cases on
section 15(1) of NRCD 54. The trial judge however invoked section 15(4),
applied it and, wrongly in his view, dismissed the appellant’s objection to the
suit. Relying on the case of Dam v Addo [1962] 2 GLR 200 counsel for the
appellant submitted that, in so far that the trial judge invoked section 15(4)
which was not the basis of the case of either party, the judge erred and so his
order on the preliminary objection should be set aside.<o:p></o:p>It
will be observed that section 15(1) is made expressly subject to the provisions
of section 15(4). Section 15(4) of NRCD 54 also provides that:<o:p></o:p>“No period of limitation fixed by this
Decree shall apply to an action against a trustee or any person claiming
through him where-<o:p></o:p>