ERNEST KOJO BONSU (SUING FOR HIMSELF AND AS MINORITY SHAREHOLDER IN HGS LTD vs. HGS LIMITED, STEPHEN KARL TIMMS AND PHILIP STEPHEN PHILLIPS [2015]DLCA8409

ERNEST KOJO BONSU (SUING FOR HIMSELF AND AS MINORITY SHAREHOLDER IN HGS LTD vs.... [2015]DLCA8409

Date	2015-10-22
Suit No.	CIVIL APPEAL: H3/249/2015
Citation No.	[2015]DLCA8409

KUSI-APPIAH JA (PRESIDING)

ACQUAYE JA

AGYEMANG (MRS.) JA

MR. KWAME A. YANKYERA FOR THE PLAINTIFF / APPELLANT

MR. J. M. S. HAYFRON-BENJAMIN FOR THE DEFENDANTS / RESPONDENTS

[2015]DLCA8409
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													<main id="main" class="content" style="min-height: 60rem" >ERNEST KOJO BONSU (SUING FOR HIMSELF AND AS MINORITY SHAREHOLDER
IN HGS LTD<o:p></o:p>(PLAINTIFF
/ APPELLANT)<o:p></o:p><span lang="EN-GB" style="font-size:12.0pt;line-height:115%;font-family:&quot;Book Antiqua&quot;,serif;
mso-fareast-font-family:&quot;Book Antiqua&quot;;mso-bidi-font-family:&quot;Book Antiqua&quot;;
color:#00B0F0">vs.<o:p></o:p>HGS LIMITED, STEPHEN KARL TIMMS AND PHILIP STEPHEN PHILLIPS<o:p></o:p>(DEFENDANTS
/ RESPONDENTS)<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;
padding:0cm 0cm 1.0pt 0cm">

CIVIL APPEAL: H3/249/2015&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &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: 22ND OCT, 2015<o:p></o:p>

</div>COUNSEL:<o:p></o:p>MR. KWAME A. YANKYERA FOR THE PLAINTIFF / APPELLANT<o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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MR. J. M. S.
HAYFRON-BENJAMIN FOR THE DEFENDANTS / RESPONDENTS<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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KUSI-APPIAH JA (PRESIDING),
ACQUAYE JA, AGYEMANG (MRS.) JA<o:p></o:p>

</div>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <o:p></o:p><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="margin-bottom:0cm;margin-bottom:.0001pt;
text-align:center;border:none;mso-border-bottom-alt:solid windowtext 1.5pt;
padding:0cm;mso-padding-alt:0cm 0cm 1.0pt 0cm">JUDGMENT<o:p></o:p>

</div>AGYEMANG, JA:<o:p></o:p>In this interlocutory appeal, the appellant herein
seeks to have the ruling of the court below set aside, and for this court to
make an order for a forensic audit of the first defendant / respondent company
to be carried out by Ernst and Young, a firm of Chartered Accountants. This was
said to be in accordance with the agreement of the parties reached earlier,
aimed at determining the value of the first defendant / respondent (referred to
hereafter as the first respondent). <o:p></o:p>The determination of the value of the first
respondent company was contained in the ruling of the court below of 20th
December 2013. The purpose was to inform the buying out of the ten percent
share of the appellant herein in the first respondent, by the other respondents.
The order followed an application brought by the respondents herein under S.218 of the Companies’ Act 1963 Act 179
as remedy for alleged oppression of the appellant by the second and third
respondents. <o:p></o:p>The application was brought after the close of
pleadings and before the taking out of an application for directions. It
followed the plea of the respondents contained in an application for security
for costs that an order for a share purchase by the respondents of the
appellant’s shares would be a desirable course to resolve the dispute between
the parties. In that application it was said among others that this was because
the relationship of the parties was so irretrievably damaged that they could
not be expected to continue therein as members/officers of the company. <o:p></o:p>The learned trial judge appeared to be of the same
view and ruled that a share purchase order was the course to take. He however
held that for the order to be made, the court had to be apprised of the value
of the company, hence the need to have an audit and valuation of the company.
Thus did he order that the said audit/valuation be carried out by Ernst and
Young, a company chosen by agreement of the parties.<o:p></o:p>Following the order which was served on Ernst and
Young, that company set to work and reported back that it would not be able to
undertake a valuation of the company without carrying out a forensic audit. The
opinion of another firm of auditors: Price Waterhouse was sought regarding the
conduct of a forensic audit and valuation. In his consideration of which
company to appoint to undertake the audit/valuation, Price Waterhouse was dropped
as, per the learned trial judge in his ruling, that company in giving a
quotation, had concerned itself with the validation of accounts rather than a
forensic audit. Ernst and Young quoted the price of USD218,592 for same to be
undertaken. The respondents then went back to the court to complain that the
price tag for the forensic audit was enormous and could not be met by the first
respondent. The appellant disagreed, alleging that the first respondent could
afford to pay for the forensic audit ordered.<o:p></o:p>To make a determination on the matter, the court
ordered the respondents to file an affidavit of means of the first respondent.<o:p></o:p>In an application that was resisted unsuccessfully
by the appellant, the court below, relying on audited accounts presented as showing
the financial standing of the first respondent from 31 December 2009 to 30
September 2013,ruled inter alia, that: “The Court can therefore not make any
orders against the first defendant to pay for the costs of the forensic audit.
The parties will therefore be advised to reach out to other accounting firms
who would be prepared to value the assets of the company at a fee that will be
affordable to the 1st defendant company”.<o:p></o:p>It is against this ruling, that the present appeal
has been brought.<o:p></o:p>The appellant </main>