AMOS WEDZI vs. HOTEL MAJORIE ‘Y’ LTD, RICHARD YAO WEDZI AND MICHAEL YAO MONYO [2014]DLSC4556

Date	2014-05-07
Suit No.	CIVIL APPEAL NO.J4/45/2013
Citation No.	[2014]DLSC4556

ATUGUBA J.S.C. (PRESIDING)

ANSAH J.S.C.

BAFFOE BONNIE J.S.C.

GBADEGBE J.S.C.

AKOTO BAMFO (MRS) J.S.C.

OSAFO BUABENG ESQ. FOR THE 1ST DEFENDANT/APPELLANT /APPELLANT.

KWAME AGATI ESQ. WITH HIM MICHAEL AKANBEK FOR THE 3RD

DEFENDANT/RESPONDENT/RESPONDENT.

[2014]DLSC4556
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													<main id="main" class="content" style="min-height: 60rem" >AMOS WEDZI<o:p></o:p>(PLAINTIFF/RESPONDENT)<o:p></o:p>vs.<o:p></o:p>HOTEL MAJORIE ‘Y’ LTD,
RICHARD YAO WEDZI AND MICHAEL YAO MONYO<o:p></o:p>(DEFFENDANT/RESPONDENT /RESPONDENT)<o:p></o:p>[SUPREME
COURT, 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.J4/45/2013&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &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: 7TH MAY 2014<o:p></o:p>

KWAME
AGATI ESQ. WITH HIM MICHAEL AKANBEK FOR THE 3RD
DEFENDANT/RESPONDENT/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">JUDGMENT<o:p></o:p>

</div>BAFFOE-BONNIE JSC.&nbsp; <o:p></o:p>The
facts leading to this appeal are fairly simple and uncontroverted.&nbsp; When the appellant company was formed the
initial share holding structure was as follows; 60% to the 2nd Defendant
Richard Yao Wedzi, 20% to plaintiff/respondent Amos Wedzi and 20% to Welbeck
Wedzi (now deceased).&nbsp; These three
persons were also the first Directors of the company, For some reasons which
are not necessary for the resolution of this appeal, the 2nd defendant and
Welbeck Wedzi purported toforfeit the 20% shares of the plaintiff and sold same
together with the 20% shares of Welbeck Wedzi for $350,000 to the 3rd
def/resp/resp, Michael Yao Monyo. The plaintiff was also removed as a director
of the company and the 3rd defendant was made a Director in his stead<o:p></o:p>Aggrieved
by the forfeiture of his shares and removal as director, Amos Wedzi&nbsp; hereafter the plaintiff, brought an action
before the High court challenging the procedure for the forfeiture and sale of
his 20% shares. After a lengthy trial, the court found the forfeiture of the
shares and the removal of the plaintiff as director as wrongful same having
been done in breach of the company regulations. The court held as follows;<o:p></o:p>“The evidence shows that the 2nd
defendant sold 40% shares in the 1st defendant company to the 3rd
defendant.&nbsp; This sale was evidenced by an
agreement dated 2nd May 1997 between the 2nd defendant and the 3rd defendant
and which was tendered by the plaintiff as Exhibit ‘D’.&nbsp; Subsequent to the acquisition of the shares
the 3rd defendant was also appointed a director of the company.&nbsp; The 3rd defendant was later issued with a
share certificate which was tendered by the 3rd defendant in evidence as
Exhibit ‘1B’.&nbsp; Thus by the said sale and
transfer of shares the 3rd defendant became a 40% shareholder whilst the 2nd
defendant became a 60% shareholder.&nbsp; The
20% shares held by the plaintiff and their father Welbeck Kwesi Wedzi thus
ceased to exist.&nbsp; I have earlier on in
this judgment held that the purported forfeiture of the plaintiff’s share was
illegal and void and that the plaintiff is still a member and shareholder of
the company.&nbsp; I should say in passing
that Welbeck Kwesi Wedzi (the father of the plaintiff and 2nd defendant) was
also a 20% shareholder whose shares were affected by the said sale
agreement.&nbsp; He is said to be
deceased.&nbsp; The evidence shows that he
died in 2004. The evidence shows that at the time of the execution of Exhibit
‘D’, Welbeck Kwesi Wedzi was present.&nbsp; He
indeed appended his signature to Exhibit ‘D’ as a witness for the 2nd
defendant.&nbsp; That probably explains why he
did not in his lifetime challenge the forfeiture of his shares.&nbsp; In any event the forfeiture of his shares is
not an issue before me.”<o:p></o:p>Since
I have held that the plaintiff is a 20% shareholder and the sale of his shares
to the 3rd defendant is void, I hereby order the sale and transfer of the
plaintiff’s 20% share to the 3rd defendant be and is hereby set aside.&nbsp; Thus 3rd defendant will no more be a 40%
shareholder; he will be left with 20%.”<o:p></o:p>The
3rd defendant bought the 40% shares for $300,000.&nbsp; I will therefore declare that the 3rd
defendant is a 20% shareholder and that he is a creditor of the company in
respect of the sum of $150,000 representing the value of the 20% shares of the
plaintiff wrongfully sold to him.<o:p></o:p>It
is also obvious that the appointment of the 3rd defendant as a director to fill
the vacancy left by the wrongful removal of the plaintiff was also in violation
of section 181 and 272 of the code.&nbsp; I
hold that the appointment of the 3rd defendant as a director was illegal and
therefore void.&nbsp; I hold therefore that
the 3rd defendant is not a validly appointed director of the 1st defendant.”<o:p></o:p>The
summary of the judgment of the trial court was that<o:p></o:p>1The
sale of the plaintiff’s 20% share was wrongful and therefore reversed<o:p></o:p>2Welbeck
Wedzi had not challenged the sale of of his 20% shares in his lifetime. In
fact, unlike the first defendant who was deemed not to have had proper
notification of the forfeiture and sale of his shares, Welbeck Wedzi was a
signatory of the sale agreement that divested himself of his 20% shares. And in
any case, as the trial judge remarked, the issue of the forfeiture of the
shares of Welbeck Wedzi was not before him.<o:p></o:p>3
Since the sale of the plaintiffs 20% shares had been reversed, the 3rd
defendant respondent was entitled to only 20% shares, ostensibly, those shares
belonging to Welbeck Wedzi, which was not being challenged. He then became a
creditor to the Company in the amount of $150,000.<o:p></o:p>4
3rd def/resp appointment as Director of the company was also declared null a</main>