[2018]DLHC9307 Login to Read Full Case <span style="font-size: 18px !important;"><p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:normal"><b><span style="font-size:12.0pt;font-family:"Book Antiqua",serif;color:#00B0F0">HFC BANK GHANA LIMITED</span></b><span style="font-size:12.0pt;font-family:"Book Antiqua",serif; color:#00B0F0"><o:p></o:p></span></p><p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:115%"><i><span style="font-size:10.0pt;line-height:115%;font-family:"Book Antiqua",serif">(APPLICANT)<o:p></o:p></span></i></p><p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:115%"><b><span style="font-size:12.0pt;line-height:115%;font-family:"Book Antiqua",serif; color:#00B0F0">vs.<o:p></o:p></span></b></p><p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:115%"><b><span style="font-size:12.0pt;line-height:115%;font-family:"Book Antiqua",serif; color:#00B0F0">NAASEI BOAKYE ENTERPRISE LIMITED & NAASEI BOAKYE </span></b><b><span style="font-size:12.0pt;line-height:115%;font-family:"Book Antiqua",serif"> </span></b></p><p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:115%"><b><span style="font-size:12.0pt;line-height:115%;font-family:"Book Antiqua",serif"><br></span></b><i><span style="font-size:10.0pt;line-height:115%;font-family:"Book Antiqua",serif">(RESPONDENTS)</span></i><span style="font-size:10.0pt;line-height:115%;font-family:"Book Antiqua",serif"><o:p></o:p></span></p><p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:115%"><span style="font-size:10.0pt;line-height: 115%;font-family:"Book Antiqua",serif">[HIGH COURT, KUMASI]<o:p></o:p></span></p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt; padding:0cm 0cm 1.0pt 0cm"> <p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:normal;border:none;mso-border-bottom-alt:solid windowtext 1.5pt; padding:0cm;mso-padding-alt:0cm 0cm 1.0pt 0cm"><span style="font-size:10.0pt; font-family:"Book Antiqua",serif">SUIT NO. MISC/07/2017 DATE: 24<sup>TH</sup> JANUARY, 2018<o:p></o:p></span></p> </div><p class="MsoNormal" style="margin-bottom:0cm;margin-bottom:.0001pt;text-align: justify;line-height:normal"><b><span style="font-size:12.0pt;font-family:"Book Antiqua",serif">COUNSEL: <o:p></o:p></span></b></p><p class="MsoNormal" style="margin-bottom:0cm;margin-bottom:.0001pt;text-align: justify;line-height:normal"><span style="font-size:12.0pt;font-family:"Book Antiqua",serif">SULLEYSAMBIAN FOR THE APPLICANT<o:p></o:p></span></p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt; padding:0cm 0cm 1.0pt 0cm"> <p class="MsoNormal" style="margin-bottom:0cm;margin-bottom:.0001pt;text-align: justify;line-height:normal;border:none;mso-border-bottom-alt:solid windowtext 1.5pt; padding:0cm;mso-padding-alt:0cm 0cm 1.0pt 0cm"><span style="font-size:12.0pt; font-family:"Book Antiqua",serif">DR. ERNEST OWUSUDAPAAH FOR THE RESPONDENTS<o:p></o:p></span></p> </div><p class="MsoNormal" style="margin-bottom:0cm;margin-bottom:.0001pt;line-height: normal"><b><span style="font-size:12.0pt; font-family:"Book Antiqua",serif">CORAM:<o:p></o:p></span></b></p><p class="MsoNormal" style="margin-bottom:0cm;margin-bottom:.0001pt;line-height: normal"><span style="font-size:12.0pt;font-family:"Book Antiqua",serif">HIS LORDSHIP JUSTICE DR. RICHMOND OSEI-HWERE<o:p></o:p></span></p><div style="mso-element:para-border-div;border-top:solid windowtext 1.5pt; border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none; padding:1.0pt 0cm 1.0pt 0cm"> <p class="MsoNormal" align="center" style="margin-bottom:0cm;margin-bottom:.0001pt; text-align:center;line-height:normal;border:none;mso-border-top-alt:solid windowtext 1.5pt; mso-border-bottom-alt:solid windowtext 1.5pt;padding:0cm;mso-padding-alt:1.0pt 0cm 1.0pt 0cm"><b><span style="font-size:12.0pt;font-family: "Book Antiqua",serif">RULING<o:p></o:p></span></b></p> </div><p class="MsoNormal" style="text-align:justify;text-indent:36.0pt;line-height: 200%"><span style="font-size:12.0pt;line-height:200%;font-family:"Book Antiqua",serif">This ruling seeks to determine the merits of the preliminary legal objection in relation to a motion on notice for judicial sale of mortgage property. <o:p></o:p></span></p><p class="MsoNormal" style="text-align:justify;text-indent:36.0pt;line-height: 200%"><span style="font-size:12.0pt;line-height:200%;font-family:"Book Antiqua",serif">The said motion was filed on 10/11/2016 and the respondents filed an affidavit in opposition to the motion as well as a supplementary affidavit on 22/11/2016 and 13/10/2017 respectively. Subsequent to the filling of the motion, several attempts were made to settle the matter out of court but the efforts fell through. When the motion finally came up for hearing on 23/10/2017, counsel for the defendants/respondents raised a preliminary legal objection to the motion.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top:12.0pt;text-align:justify;text-indent: 36.0pt;line-height:200%"><span style="font-size:12.0pt;line-height:200%; font-family:"Book Antiqua",serif">Counsel for the respondents submitted that the preliminary legal objection is founded on the ground that the non-registration of the deed of mortgage sought to be enforced is contrary to the clear provisions of the Mortgages Act,1972 (NRCD 96) particularly section 3(2) as well as section 24(1) of the Land Registry Act, 1962 (Act 122). Counsel submitted that a mortgage is an instrument affecting land and it is a statutory requirement that an instrument affecting interest in land must be registered in accordance with Act 122. He further submitted that the use of the word “may” in section 3(2) of NRCD 96 should not to be interpreted to mean a permissiverequirement since such interpretation will do violence to the object and purpose of establishing a registration regime for instruments affecting interest in land. Counsel submitted that a mortgage ought to be registered in order for it to be accorded validity which is a prerequisite to the enforcement procedure under s 18 of NRCD 96. He emphasized that the power of the court to order a judicial sale of mortgaged property relate to a valid mortgage.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top:12.0pt;text-align:justify;text-indent: 36.0pt;line-height:200%"><span style="font-size:12.0pt;line-height:200%; font-family:"Book Antiqua",serif">Counsel also submitted that the mortgage in contention being a contract of guarantee cannot be enforced by a judicial sale and that the proper method for seeking redress for the alleged breach ought to be by writ of summons and not by originating motion. He cited Order 2 rule 2 of CI 47 as well as Order 59 rule 2 to buttress the point.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top:12.0pt;text-align:justify;text-indent: 36.0pt;line-height:200%"><span style="font-size:12.0pt;line-height:200%; font-family:"Book Antiqua",serif">In response to the preliminary legal objection, counsel for the plaintiff/applicant submitted thatthe legal objection is misconceived. He cited Order 2 r 2 and stated that there is an existing enactment in the Mortgages Act which makes provision for enforcement of mortgages by judicial sale so the argument that they ought to come by writ of summons is untenable. He made reference to s 3(2) of NRCD 96 and submitted that failure to register a mortgage does not derogate the substance of the mortgage. Counsel cited a Supreme Court decision in Anthony Wiafe v Dora BorkaiBortey and Victoria Amoo [2017] 104 GMJ 161 at 167 where it was held that non-registration of an instrument does not derogate from the contract. Counsel emphasized that the fact of non-registration does not affect the rights of the parties. He further submitted that a non-registered mortgage may not meet the requirements of legal mortgage but meets the requirements of an equitable mortgage which can also be enforced. Counsel invited the court to dismiss the preliminary legal objection.<o:p></o:p></span></p><p class="MsoNormal" style="margin-top:12.0pt;text-align:justify;text-indent: 36.0pt;line-height:200%"><span style="font-size:12.0pt;line-height:200%; font-family:"Book Antiqua",serif">From the foregoing, the issues for determination are: 1. whether the unregistered deed of mortgage can be enforced by the court; and 2. whether a deed of mortgage can be enforced by judicial sale.<o:p></o:p></span></p><p class="MsoNormal" style="text-align:justify;text-indent:36.0pt;line-height: 200%"><span style="font-size:12.0pt;line-height:200%;font-family:"Book Antiqua",serif">A mortgage is an instrument affecting land and as such falls within the ambit of section 24(1) of the Land Registry Act, 1962 (Act 122) which provides for the compulsory registration of instruments affecting land. Section 24(1) of Act 122 states:<o:p></o:p></span></p><p class="MsoNormal" style="margin-left:72.0pt;text-align:justify;line-height: 200%"><i><span style="font-size:12.0pt; line-height:200%;font-family:"Book Antiqua",serif">“24. (1) Subject to subsection (2), of this section, an instrument other than,<o:p></o:p></span></i></p><p class="MsoNormal" style="margin-left:36.0pt;text-align:justify;text-indent: 36.0pt;line-height:200%"><i><span style="font-size:12.0pt;line-height:200%;font-family:"Book Antiqua",serif">(a) a will, or <o:p></o:p></span></i></p><p class="MsoNormal" style="margin-left:36.0pt;text-align:justify;text-indent: 36.0pt;line-height:200%"><i><span style="font-size:12.0pt;line-height:200%;font-family:"Book Antiqua",serif">(b) a judge’s certificate first executed after the commencement of this Act shall be of no effect until it is registered.”<o:p></o:p></span></i></p><p class="MsoNormal" style="text-align:justify;text-indent:36.0pt;line-height: 200%"><span style="font-size:12.0pt;line-height:200%;font-family:"Book Antiqua",serif">In Asare v Brobbey [1971] 2 GLR 331 at 337, CA, the Court of Appeal delved into the legal effect of s 24(1) of Act 122, it observed in its judgment as follows: <o:p></o:p></span></p><p class="MsoNormal" style="margin-left:36.0pt;text-align:justify;line-height: 200%"><i><span style="font-size:12.0pt; line-height:200%;font-family:"Book Antiqua",serif">“It follows ther