Legon Burns Over $64m Deal… Alumnus Sues Prof Ernest Aryitey, et al At Supreme Court
Samuel K. Andrews, an alumnus of the University of Ghana has sued the Attorney General, University of Ghana, CPA 18 Integras Ghana Investor Limited, Prof. Ernest Aryeetey, former Vice Chancellor of the premier university and the Public Procurement Authority (PPA) at the Supreme Court, for the role they played in the signing of $64 million Public Private Partnership (PPP) pact with the third defendant, without the approval of cabinet.
Reliefs
Among the reliefs being sought by the plaintiff are; declaration that the conduct of the 2nd Defendant, a subvented public University, in entering into a so-called “Concession Agreement” with the 3rd Defendant without reference to 5th Defendant (PPA) violates section 14 of the Public Procurement Act, 2003 (Act 663) [as amended by Act 914] and renders same as null and void and of no legal effect.
Declaration that the 3rd Defendant, who touts itself as having a wide experience in the conduct of business worldwide, owed a duty in law to conduct due diligence of or about the legal regime for investment in Ghana, including in particular, the requirements of the Public Procurement Act, 2003 (Act 663) [as amended by Act 914]; the Financial Administration Act, 2003 (Act 654).
The University of Ghana Financial & Governance Regulation, as well as the Ghana Government Private-Public Policy (PPP) as a condition precedent to entering into the so-called “Concession Agreement” with the 3rd Defendant, failing which the 3rd Defendant is not entitled to any reliefs or any equitable reliefs from a court of law in Ghana; further, or in the alternative.
Samuel K. Andrews is further seeking an order of restrictive injunction on pain of contempt of the Supreme Court restraining the 2nd Defendant (Legon) and 3rd Defendant, their agents, privies, assigns or howsoever-called from commencing or entering into any arrangements, discussions, negotiations, etc, to compromise the suit during its pendency before the Supreme Court.
Statement of claim
In a statement claim filed on his behalf by Paintsil, Paintsil & Co, an Accra based legal firm, plaintiff averred that on 26th June, 2015, the 2nd Defendant organised a public ceremony at its Great Hall to mark or witness the signing ceremony of what was then touted as a landmark agreement (“the Concession Agreement“) between the 2nd and 3rd Defendants under which the 3rd Defendant was to construct for the 2nd Defendant certain academic facilities at its Legon campus.
“According to information published on the 2nd Defendant's official website for that day, the entire project was estimated to cost US$64 million and was structured as a 25 years Build, Operate and Transfer (BOT), as well as Public Private Partnerships (PPP) collaboration.
“It was further stated by the 4th Defendant, the 2nd Defendant's Vice Chancellor at the time that, the 2nd Defendant had received final funding approvals to proceed with the project, with the 3rd Defendant.
“Finally, it was alleged that the construction of the academic and other facilities was to commence by September 2015, with a targeted completion date of September 2017. (Exhibit A, being a copy of the 2nd Defendant's publication refers)”, plaintiff said.
Samuel K. Andrews contended that at all material times of executing the said Concession Agreement, there was in place, to both parties' knowledge, the Ghana Government Public Private Partnership (PPP) policy, which contained clear guidelines on how public entities like the 2nd Defendant were required to act in all cases when they were entering into a PPP agreement.
According to him, there was also in place to the 3rd Defendant's knowledge the 2nd Defendant's Financial Regulations and Governance (FRG), consisting of the 2nd Defendant's policies and procedures relating to financial management control, which, according to the document, were assembled with reference to the Financial Administration Act, 2003 (Act 654), the Public Procurement Act, 2003 (Act 663), among others.
Much significantly, he continued, the foreword to the FRG was made by the 4th Defendant in his capacity as the Vice Chancellor.
“Further, to the knowledge of the 2nd and 3rd Defendants, the principal legislation governing public procurement in Ghana was the Public Procurement Act, 2003 (Act 663) which, by its section 14 (c) and (f) made the 2nd Defendant subject to the procurement processes under the Act.
“Further, by section 65 (9) thereof, the 2nd Defendant was obliged to give notice of the Procurement Contract to unsuccessful bidders and to publish same in the Procurement Bulletin,” he said.
The Plaintiff is contending that the significance of the 2nd Defendant's FRG, the Ghana Government PPP policy, as well as Act 663 is that by strict compliance with same, there will be value for money for the procuring entity, in this case the 2nd Defendant and the public purse.
No show
However, contrary to the 2nd and 3rd Defendant's public show and representations to the general public at the execution of the Concession Agreement on 2nd June 26, 2015, by the contractual delivery date, there was practically nothing to show for the academic facilities and other buildings that the 3rd Defendant undertook to build for the 2nd Defendant.
By conservative estimates, whatever structures the 3rd Defendant had constructed at the time was at about less than 20% of the completion stage.
“On the contrary, there was a lot of muted squabbling and boardroom wrangling between the 2nd and 3rd Defendants which found expression and continues to find expression in accusations, counter-accusations and rebuttals in the Ghanaian media.
“Being curious, agitated and anxious by the said development, the Plaintiff's first recourse was to conduct an on-line search on the 5th Defendant's web site, having regard to the fact that the 5th Defendant is mandated by law to publish all tenders relating to public procurements on its website and in the Public Procurement Bulletin.
However, this was to no avail as no such information was published on its web site.
Request for Concession Agreement
“Further, being of the firm view that the Concession Agreement between the 2nd and 3rd Defendants were matters which ought to be in the public domain, one way or the other, the Plaintiff caused two letters dated 18th September, 2017 (corrected on 19th September, 2017) and 16th October, 2017, to be written to the 2nd Defendant, requesting the 2nd Defendant to provide the Plaintiff with a copy of the Concession Agreement for the Plaintiff's study and necessary action. (Exhibits E, E1 and E2 refer)
“The 2nd Defendant, however, refused without any good reason, to avail the Plaintiff a copy of the Concession Agreement. As things stand now, the Concession Agreement remains a tight secret between the 2nd and 3rd Defendants, but believed to contain terms, which according to some social commentators, is heavily lop-sided in the 3rd Defendant's favour against the 2nd Defendant, onerous and unconscionable.
“A previous suit the Plaintiff instituted against the 2nd and 3rd Defendants for an order directed to them to deliver a copy of the Concession Agreement to the Plaintiff, pursuant to Article 21 of the 1992 Constitution has since been discontinued on the basis that the nature of the relief the Plaintiff sought was not justiciable in the High Court. (Exhibit F and F 1 refer)
“Notwithstanding that, the Plaintiff proposes to apply for an order of discovery to be made against the 2nd and 3rd Defendants to file a copy of the Concession Agreement before the Supreme Court to provide an opportunity for the parties and the Court to examine all issues in controversy.
“Against the background of lack of any information about the Concession Agreement on the 5th Defendant's website, the Plaintiff caused a letter dated 21st February, 2018, to be made to the 5th Defendant to enquire from the 5th Defendant whether there has been compliance by the 2nd and 3rd Defendants with Act 663 in the execution of the Concession Agreement and in securing any services or contracts thereunder. (Exhibit G refers)
“However, in a most shocking turn of events, all the Plaintiff got for his efforts was a very cheeky letter dated 1st March, 2018, authored personally by the 5th Defendant's CEO, which the Plaintiff shall contend is totally undeserving and betrays the lack of transparency on the 5th Defendant's part, besides casting serious doubts as to whether the 5th Defendant or its Chief Executive Officer really appreciates the 5th Defendant's core mandate.”
The very best information that the Plaintiff has so far gathered about the 3rd Defendant is that besides being incorporated under Ghanaian law, there is nothing Ghanaian about the 3rd Defendant.
Shareholding structure
Among others, its shareholding structure is shrouded in secrecy; the 3rd Defendant has no known presence or physical business address in the whole country save only that of its Secretary/ Solicitor's address, being No. 8, Dr. Isert Road, North Ridge, Accra.
What is evidently clear, therefore, is that the 3rd Defendant was registered in Ghana solely for the purpose of being awarded the Concession Agreement and could not have demonstrated the wherewithal by itself or the ability or competence for undertaking the onerous responsibility it assumed under the Concession Agreement, not to talk about the proven track record required by Act 663 and the Ghana Government PPP policy.
At the same time, the 3rd Defendant's representation at the time of execution of the Concession Agreement to have considerable expertise in the construction of academic facilities worldwide was positively misleading and false in every material particular because having been just incorporated in Ghana, the 2nd Defendant could not have any track record to rely upon, save only by reference to the unproven competencies of third parties who were in any case not parties to the Concession Agreement.
Besides, there is to date no known project of the type envisaged under the Concession Agreement in the whole of Africa or elsewhere, which the 3rd Defendant has executed, either before or after the execution of the Concession Agreement.
It is, therefore, very doubtful how the 3rd Defendant endeared itself to the 2nd Defendant to be chosen to enter into the Concession Agreement to the exclusion of any or other parties.
Further, the 4th Defendant's representation that the 2nd Defendant had received all approvals and also secured funds to undertake its obligations under the Concession Agreement was positively misleading and untrue as the Concession Agreement was entered into on the dark side of the Ghana Government and the Public Procurement Authority and, in particular, without cabinet approval, a requisite for all PPP projects beyond GH¢50 million.