JSC INVESTMENT LTD. vs. ACTIVITY VENTURE FINANCE CO. LTD. [2010]DLCA5007

Date	2010-06-17
Suit No.	CIVIL APPEAL NO. H1/124/2010
Citation No.	[2010]DLCA5007

HENRIETTA ABBAN JA PRESIDING

MARFUL-SAU JA

ADUAMA OSEI JA

MR KWAKU GYAU BAFFOUR FOR DEFENDANT/APPELLANT

MRS. MARIETTA APPIAH OPPONG FOR PLAINTIFF/RESPONDENT

[2010]DLCA5007
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													<main id="main" class="content" style="min-height: 60rem" >JSC INVESTMENT LTD.<o:p></o:p>(PLAINTIFF/RESPONDENT)<o:p></o:p>vs.<o:p></o:p>ACTIVITY VENTURE FINANCE
CO. LTD.<o:p></o:p>(DEFENDANT/APPELLANT)<o:p></o:p><o:p>&nbsp;</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;
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CIVIL APPEAL NO. H1/124/2010&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &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: 17TH
JUNE, 2010<o:p></o:p>

</div>COUNSEL:<o:p></o:p>MR KWAKU GYAU BAFFOUR FOR
DEFENDANT/APPELLANT<o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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MRS.
MARIETTA APPIAH OPPONG FOR PLAINTIFF/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;
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HENRIETTA
ABBAN JA PRESIDING, MARFUL-SAU JA, ADUAMA OSEI JA<o:p></o:p>

</div><o:p>&nbsp;</o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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JUDGMENT<o:p></o:p>

</div>MARFUL-SAU JA: <o:p></o:p>This appeal is taken from
the judgment of the High Court (Commercial Division) dated the 8th
of June, 2009. By a writ of summons filed on the 7th of October,
2008, the Plaintiff claimed the following against the Defendant:<o:p></o:p>‘’a. $180,000 being entitlements due
to the Plaintiff under the Agreement.<o:p></o:p>&nbsp; b. Interest on the said amount due to the
plaintiff from the 12th of June &nbsp;&nbsp;<o:p></o:p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2008 date of termination till date of
final payment.”<o:p></o:p><o:p>&nbsp;</o:p>In this appeal the
Plaintiff will be referred to as the Respondent while the Defendant will be
known as the Appellant. The facts of the case are quite simple.&nbsp; The parties herein entered into a contract on
the 1st November 2006, by which the Respondent was engaged to manage
investment fund provided by the Appellant. Under the Fund Management Agreement
which regulated the rights and obligations of the parties, the Respondent was
to be paid 2.5% of the committed capital as management fee per annum. From the
record of appeal the committed capital was US $10,000,000.00 and therefore the
Respondent’s management fee was to be US$250,000.00 per annum. The appointment
of the Respondent as the Fund Manager was terminated by the Appellant on the 12th
of June 2008. The Respondent therefore claimed the amount of US$180,000.00
which by paragraph 8 of the statement of claim is made up as follows:-<o:p></o:p>i) US$62,000.00 being the
Respondent’s quarterly fee for the immediate preceding quarter before the
termination.<o:p></o:p>ii) US$ 118,000.00 being
the balance of the Respondent’s Annual Operating Expenses from 12th
June 2008 to December 2008.<o:p></o:p>It is clear from the record
of appeal that Respondent based its claims on clause 14. 1.2. of the Fund
Management Agreement which will be referred simply as the Agreement. The said
clause provides as follows:-<o:p></o:p>‘’
The company may terminate the appointment
of the Fund Manager by written notice taking immediate or subsequent effect,
attaching a certified copy of a resolution of the Board deciding upon such
termination, at any time. Provided always that where the company terminates
with cause, it shall pay the Fund Manager a termination fee equal to the Fund
Manager’s fee for the immediately preceding quarter plus another quarterly fee
of equal amount for the quarter following the notice of termination. Where the company terminates without cause,
it shall pay to the Fund Manager: (i) the Fund Manager’s quarterly fee for the
immediate preceding quarter and (ii) balance of the Fund Manager’s Operating
Expenses for the year of termination as approved in the Fund Manager’s Annual
Budget specifically pertaining to the investment of the company’s Committed
Capital’’<o:p></o:p>The undisputed fact in
this appeal is that the termination of Respondent’s appointment was without
cause and as such by the terms of the above clause in the Agreement the
Respondent was entitled to two payments namely; the manager’s quarterly fee for
the immediate preceding quarter before the termination and the balance of the
Manager’s Operating Expenses for the year of termination as approved in the
Manager’s Annual Budget. Indeed these entitlements were supposed to be the
claim of the Respondent at the court below. The record of appeal revealed that
before the trial commenced the Appellant paid the Respondent the Fund Manager’s
quarterly fee for the immediate preceding quarter for terminatin</main>