DAVID ANDREAS HESSE vs. INVESTCOM CONSORTIUM HOLDING [2007]DLCA6711

Date	2007-11-09
Suit No.	H3/379/07
Citation No.	[2007]DLCA6711

ABBAN JA [MRS] PRESIDING

MARIAMA OWUSU JA

I.D. DUOSE JA

MR. NTRAKWAH FOR THE 1ST DEFENDANT/APPLICANT.

MR. BENSON NUTSUKPUIE FOR INTERESTED PARTY.

MR. DAVID ANDREAS HESSE FOR THE PLAINTIFF/RESPONDENT

[2007]DLCA6711
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													<main id="main" class="content" style="min-height: 60rem" >DAVID ANDREAS HESSE<o:p></o:p>vs.<o:p></o:p>INVESTCOM CONSORTIUM
HOLDING<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">

H3/379/07&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &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 NOVEMBER, 2007<o:p></o:p>

MR.
DAVID ANDREAS HESSE FOR THE PLAINTIFF/RESPONDENT.<o:p></o:p>

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

</div>DUOSE, JA <o:p></o:p>On
the 2nd day of April, the Commercial Division of the High Court, Accra, entered
interlocutory judgment against the 1st Defendant in default of defence. <o:p></o:p>Subsequently
on the 26-04-07, the same court refused to set aside the interlocutory judgment
stating "No new issue is raised in this application to set aside that
Order." <o:p></o:p>The
1st Defendant/Appellant being dissatisfied with the ruling of the Commercial
Court Accra dated 2nd April 2007, filed an appeal against it on 07-05-07
simultaneously with application for stay of proceedings pending appeal. <o:p></o:p>Mr.
F. Ntrakwa submitted that this application had a great chance of success for
the following reasons. <o:p></o:p>(1)&nbsp; That the Defendants were sued jointly and
severally and therefore the proceedings cannot be severed Order 13 r 6 of CI
47. <o:p></o:p>(2)&nbsp;&nbsp; That the Defendants brought an application
for stay of proceedings pending arbitration which was refused. <o:p></o:p>(3)&nbsp;&nbsp; The Judge suo moto ordered the 2nd Defendant
to file his defence within a specified period. Before that period expired the
Defendants appointed new Solicitors who promptly filed appropriate notice. <o:p></o:p>(4)&nbsp;&nbsp; The Court and the Plaintiff agree to allow
the new Solicitors to study the brief thereby creating an estoppel by
convention. <o:p></o:p>(5)&nbsp;&nbsp; Yet the Plaintiff proceeded to file for
judgment in default of defence. <o:p></o:p>(6)&nbsp;&nbsp; The Defendants filed application for
extension of time to appeal against the earlier ruling of the court refusing to
stay proceedings pending arbitration to be heard on 10-04-07 same was served on
the Plaintiff on 26-03-07. <o:p></o:p>(7)&nbsp; The Plaintiff filed application for judgment
in default of defence on 27-03-07 fixed for hearing on 3rd April subsequently
brought forward by the court to 2nd April.&nbsp;
In effect the application for default judgment which was filed later in
time was heard earlier and granted, whereas the application for extension of
time to appeal against the ruling of the court dated 02-04-07 was refused.<o:p></o:p>(8)&nbsp;&nbsp; By hearing the application of the Plaintiff
filed later before the one filed Earlier by the Defendant manifest injustice
was caused to defendant. <o:p></o:p>(9)&nbsp;&nbsp; That the failure to file the statement of
defence within time was in Pursuance of a legal right under S. 8 of the
Arbitration Act 1961 Act 38 and Order 64 r 1 of CI. 47.&nbsp; The law required that a party who wished to
rely on or to enforce an arbitration provision in a contract or agreement must
first apply for stay of proceedings after entry of appearance. <o:p></o:p>That
to file a defence in the circumstances would constitute a new step in the
proceedings after notice of an irregularity and thereby be deemed to have
waived his right to arbitration.&nbsp; He
cited the following legal authorities.&nbsp;
SKANSKA JENSEN INTERNATIONAL VRS. KLIMATECHNIK ENGINEERING LTD. 2003/04
SCGLR 698. <o:p></o:p>(j)&nbsp; That the defendants at the time they filed
for the court to set aside the default judgment exhibited a proposed statement
of defence to impress the court that the defendants had a good defence to the
action. <o:p></o:p>(k)&nbsp; The defences of the 1st and 2nd Defendants
are similar almost the same and continuing action against one while the other
cannot be heard in defence because of the interlocutory judgment in default of
defence will produce an incongruous legal result and may lengthen litigation
should the 1st defendant eventually succeed in setting aside the default judgment.
<o:p></o:p>(l)&nbsp;&nbsp; Prays for a conditional stay for a definite
period as the records have been settled for the appeal to be heard.&nbsp; The court’s attention was drawn to the
following legal authorities – BMC GHANA LTD. VRS. ASHANTI GOLDFIELDS BIBIANI
LTD. 2005/06 SCGLR 602 – which require the courts to encourage arbitration in
particularly in commercial conflicts or disputes. <o:p></o:p>