CDH FINANCIAL HOLDINGS LTD AND CDH SAVINGS AND LOANS LTD vs. LIFEFORMS LTD AND SWITCHBACK DEVELOPMENT LTD [2019]DLHC7535

CDH FINANCIAL HOLDINGS LTD AND CDH SAVINGS AND LOANS LTD vs. LIFEFORMS LTD AND S... [2019]DLHC7535

Date	2019-02-15
Suit No.	SUIT NO.CM/BDC/0210/19
Citation No.	[2019]DLHC7535

JEROME NOBLE-NKRUMAH JUSTICE OF THE HIGH COURT

RICHARD AMOFA FOR THE PLAINTIFFS

PATRICK SOGBODJO FOR THE 1ST DEFENDANT

SAMUEL NARH LED BY BENJAMIN BAFFOE BONNIE FOR THE 2ND DEFENDANT

[2019]DLHC7535
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													<main id="main" class="content" style="min-height: 60rem" >CDH FINANCIAL
HOLDINGS LTD AND CDH SAVINGS AND LOANS LTD<o:p></o:p>vs.<o:p></o:p>LIFEFORMS LTD AND SWITCHBACK DEVELOPMENT LTD<o:p></o:p>[HIGH COURT (COMMERRCIAL DIVISION), ACCRA]<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;
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padding:0cm;mso-padding-alt:0cm 0cm 1.0pt 0cm">SUIT NO.CM/BDC/0210/19&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: 15TH FEBRUARY, 2019<o:p></o:p>

</div>COUNSEL:
<o:p></o:p>RICHARD
AMOFA FOR THE PLAINTIFFS <o:p></o:p>PATRICK
SOGBODJO FOR THE 1ST DEFENDANT <o:p></o:p><div style="mso-element:para-border-div;border:none;border-bottom:solid windowtext 1.5pt;
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SAMUEL
NARH LED BY BENJAMIN BAFFOE BONNIE FOR THE 2ND DEFENDANT <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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JEROME
NOBLE-NKRUMAH JUSTICE OF THE HIGH COURT<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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RULING<o:p></o:p>

</div>Application for
Order in the Nature of a Mareva Injunction<o:p></o:p>Over a bridge financing arrangement the
plaintiffs applicants say an amount of $5m was advanced to the 2nd
defendant respondent and for which the 2nd defendant respondent assigned
plaintiffs 11 apartments, with a commitment to buy back. Tenure of this
arrangement was 2years. Plaintiff’s applicants say they were reassured of
repayment from cash injection into the 2nd respondent by its
shareholders<o:p></o:p>This arrangement according to the
applicants was expressed in three agreements all signed on the 25th
of January 2017. It is the applicant’s case that the 2nd respondent
has received from the Social Security and National Insurance Trust [SSNIT], its
commitment as a shareholder. It is the applicants fear that should the amount
due them be not frozen by way of an order flowing from this application, they stand
to lose out entirely on this arrangement as the 2nd defendant respondent
may dissipate the funds.<o:p></o:p>Opposing this application the 2nd
respondent argues that there are three distinct contracts each with different
parties and that the applicants claim of a bridge financing arrangement is only
an afterthought. 2nd respondent urges on this court that since the
substantive action seeks to enforce the buyback arrangement, it is the 1st
defendant respondent, the applicant must be looking to [exhibit JF5]. Furthermore
there is no cause of action because by exhibit JF4 the apartments have been
assigned to the applicants.<o:p></o:p>Whilst the respondent urges on this
court there are three distinct agreements and that the bridge financing
argument by the applicant is an afterthought, this court sees it differently.
Respondents own lead arranger and financial advisor describes the arrangement
as a bridge financing arrangement.<o:p></o:p>Further to this even though there
appears to be three distinct agreements, they flow from one financing
arrangement. Theirs has been a proposal on behalf of the 2nd
defendant respondent to the 1st plaintiff, implementation or
execution of which has found expression in the three agreements. I read not
only the letter of these agreements but spirit behind them. This spirit makes
them one, they flow technically from one transaction. In fact it were not so,
exhibit CDHG on a Forms Capital letter head which I presume is the 1st
defendant, would not have been written to the Board chair of the 2nd
defendant respondent, drawing attention to the irrevocable commitment of
respondent to buy back the apartments and seeking ‘as a matter of urgency approval
for a down payment of $3m’. This same exhibit refers to $15m as having
been paid by SSNIT.<o:p></o:p>Mareva injunctions have been known to
be levelers, a powerful tool for leveling the playing field. This tool comes in
handy at the commencement of litigation [and post judgement but pre execution]
in situations where a defendant might take steps to dissipate assets. Tenure
for this arrangement is two years. Even though the plaintiff took action before
time, time is up now and the respondent is singing a different song, seeking to
distance itself from the initial arrangement. It is also clear from exhibit CDH
G that the 1st defendant was not going to raise any cash of its own
in the buyback process, having early on in exhibit CDH A stated that the
loan will be paid off as soon as the money from the right s issue is realized
or any other source of money raised by the shareholders or SDL. This
injection was not coming in the name of 1st Defendant and for its
benefit. It was from shareholders of 2nd defendant respondent and
for its benefit.<o:p></o:p>From the forgoing this court is of the
opinion that the present circumstances presents the court a proper situation
for the grant an interlocutory order by way of a Mareva injunction. <o:p></o:p>Consequently it hereby ordered that the
2nd defendant respondent shall operate its Fidelity Bank Ghana Ltd
at a minimum balance of $6,700,000.00 or its cedi equivalent. In effect the 2nd
defendant respondents account or accounts with Fidelity Bank Ghana Ltd shall,
for while this case pends</main>