PATRICIA MAUD ACQUAH vs. JUSTICE BAASAM AKROFUL & 3 ORS. [2006]DLCA6570

Date	2006-06-09
Suit No.	CIVIL APPEAL NO.: H1/28/2006
Citation No.	[2006]DLCA6570

ADINYIRA JSC. [PRESIDING]

PIESARE J.A.

APALOO J.A

MR. JUSTINE AMENUVOR FOR THE PLAINTIFF/APPELLANT

MR. KOFI ADDO FOR THE DEFENDANT/RESPONDENTS

[2006]DLCA6570
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													<main id="main" class="content" style="min-height: 60rem" >PATRICIA MAUD ACQUAH<o:p></o:p>(PLAINTIFF/APPELLANT)<o:p></o:p>vs.<o:p></o:p>JUSTICE BAASAM AKROFUL
&amp; 3 ORS.<o:p></o:p>(DEFENDANTS/RESPONDENTS)<o:p></o:p>[COURT
OF APPEAL, ACCRA]<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">

CIVIL APPEAL NO.: H1/28/2006&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; &nbsp; &nbsp; &nbsp; &nbsp; DATE: 9TH
JUNE, 2006.<o:p></o:p>

<p class="MsoNormal" style="text-align:justify;line-height:115%;border:none;
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padding:0in;mso-padding-alt:1.0pt 0in 1.0pt 0in">CORAM:
&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;&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;&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;<o:p></o:p>

</div><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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<p class="MsoNormal" align="center" style="text-align:center;line-height:115%;
border:none;mso-border-bottom-alt:solid windowtext 1.5pt;padding:0in;
mso-padding-alt:0in 0in 1.0pt 0in;mso-border-between:1.5pt solid windowtext;
mso-padding-between:1.0pt">JUDGMENT<o:p></o:p>

</div>APALOO, J.A.<o:p></o:p>&nbsp;Pampas Limited, the 4th defendant/respondent
[hereinafter respondent] was a registered wood processing company with 5,000
shares of which James Kobina Acquah, the late husband of the
plaintiff/appellant [hereinafter appellant], and the 1st respondent, held 1,650
each, Elizabeth Esi Amoakwa, the late wife of the 1st respondent held the other
remaining 1700 shares. The appellant's late husband was the managing director
or the 4th respondent company. The other director of the company was the 1st
respondent. James Kwabena Acquah died on 3rd October 1993. In this same
October, 1993, the 1st respondent as the sole surviving director of the 4th
respondent company appointed the 2nd and 3rd respondents as directors to the
board. At a meeting on 16th August, 1995 the directors resolved to issue
300,000 new shares at 100 cedis per share out of which 200,000 shares were
allotted to the 1st defendant/respondent at a total cost of 20 million cedis.
Meanwhile on 10 May 1995 the will of the late James Kobina Acquah was admitted
to probate with the administrator General appointed as the executor. The
appellant requested the respondents to register her as the holder of the shares
in the name of her late husband but they refused. She therefore commenced this
action against the respondents jointly and severally.<o:p></o:p>&nbsp;The appellant by her Writ of Summons prayed
for four orders from the High Court, Accra. The orders were that:<o:p></o:p>&nbsp;[1] The Register of the 4th Respondents be
rectified by the substitution of the appellant as owner of all the shares
standing in the name of James Robert Kobina Acquah [Deceased]<o:p></o:p>&nbsp;[2] An order cancelling the 200,000 shares
issued by 1st, 2nd and 3rd Respondents to the 1st Respondent without first
offering same to the Appellant.<o:p></o:p>[3]
An order that the board of the 4th Respondent be audited and<o:p></o:p>&nbsp;[4] An order removing the 1st, 2nd and 3rd
Respondents as directors of the 4th Respondent Company. <o:p></o:p>The
Respondents resisted appellant's claim on the ground that assets of the 4th
Respondent Company were about to be sold in satisfaction of a judgment debt and
since none of the persons interested in the company was able to save it, the
board of the 4th Respondent Company decided at an emergency meeting to float
the 300,000 shares in contention and offered 200,000 of those shares to the 1st
respondent to save the Company from liquidation. It was the contention of the
Respondents that the creation and issuance of those shares were lawful. <o:p></o:p>At
the summons for directions stage there was only one issue settled for trial and
that issue was whether or not the issuance of 200,000 new shares by the
Defendants was lawful.<o:p></o:p>&nbsp;In a decision delivered on 8/8/03 the trial High
Court dismissed the entire claim of the Appellant but entered judgment for the
Respondents. The Judge held that the 4th Respondent Company was in financial
crises and it was necessary to act boldly to salvage it. She held further that
a limited liability company has the uniqueness to continue even after the death
of directors/shareholders.<o:p></o:p>&nbsp;The appellant appealed against the High Court
decision by filing three grounds of appeal. Apart from the omnibus ground
concerning the judgment being against the weight of evidence, the ground that
the trial judge erred in holding that the issuance of the 200,000 new shares by
the Respondents was lawful, is pertinent to the whole trial. Appellant added
two additional grounds namely; that; <o:p></o:p>1.
The trial judge erred in failing to determine whether or not there was a
meeting of shareholders prior to the creation of the new shares and whether or
not the Plaintiff had notice of the said meeting and;<o:p></o:p>&nbsp;2. the trial judge erred in failing to
determine whether or not</main>