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24.03.2009 General News

A-G wrestles with court over GH¢700,000 government debt

A-G wrestles with court over GH¢700,000 government debt

The Attorney-General (A-G) has filed an application praying the Supreme Court to quash a High Court order which directed the Bank of Ghana (BoG) to release GH¢700,000 from the bank's accounts to a private company.

According to the A-G, the High Court did not have the power to attach public funds in satisfaction of a judgement debt in favour of Rockshell International Limited.

The government owes the company $7 million, having so far paid $5 million out of its total debt of $12 million owed Rockshell. The company sued the government for failing to pay it after it had sold granite stones to the government for the Keta sea defence project in February 1986 and obtained judgement for the payment of the debt but maintained that the government had refused to pay the debt, leading to the company suffering irreparable damage.

An affidavit in support of the motion for an order of certiorari to quash the High Court's decision to attach the BoG's accounts for the payment of debts filed on behalf of the A-G by the Solicitor-General, Mrs Amma A. Gaisie, conceded that the government owed the company but submitted that "the amount involved is huge and it will be impossible to make a one-off payment".

The applicant argued that the High Court erred when it granted an order directed at the Governor of the BoG to release funds from the Contingency Operational Account in payment of a judgement debt because it (the High Court) did not have the jurisdiction to make that order.

According to the A-G, "the Bank of Ghana is not party to the suit. It is a corporate body, and yet one of its accounts has been attached", adding that the Constitution did not allow the attachment of public funds to judgement debts with the reason that "the consequences would be too serious for the operations of government and the people of Ghana as a whole".

However, the applicant pointed out that "it is not our contention that the judgement debt will not be paid. In fact, and as agreed between the parties, US$5, OOO, OOO has already been paid to the interested party (Rockshell International Limited).”

The A-G further submitted that to resolve the issue the parties would have to agree on the balance of the amount due and negotiate the terms of payment of the judgement debt.

It, accordingly, prayed the court to order that public funds and government property could not be attached in execution of judgement debts, as well as an order that all orders for garnishee against the government listed accounts should be quashed.

The applicant is also praying the court to order the Controller and Accountant General to assess the original amount due Roekshell International Limited and calculate the interest due the company in accordance with the law which would form the basis for payment, less the amount already disbursed to the company.

In an affidavit in opposition, the General Manager of Rockshell International Limited, Mr Alfred O.K. Hall, submitted that the applicant had been recalcitrant in paying its debt, despite Rockshell obtaining judgement against the applicant.

It said the company and its employees had undergone irreparable hardship and tribulation as a result of the failure of the government to pay its debt for work done, although the government facilitated the acquisition of a bank loan for the execution of the project.

According to the affidavit, the company lost its equipment and factory premises, as well as personal assets and properties, to its creditors.

"The instant application amounts to an invidious invitation to this honourable court to hold that in spite of the democratic and constitutional dispensation in this country, the government of Ghana is not amenable to the execution process, even when it admits to a public debt and, indeed, where its liability has been established by a court of competent jurisdiction," it said.

According to the company, "by a bizarre twist of circumstances, the High Court vacated all orders it had made in connection with the case, including those that had not been challenged in the case, and by that action it brought the administration of justice into disrepute and thereby eroded the confidence that the interested party (Rockshell International Limited) had in the court".

It added that the application tiled by the A-G was totally "unmeritorious, frivolous and vexatious and constitutes a flagrant abuse of the court process and it should be dismissed with the appropriate deterrent costs".

The Supreme Court has adjourned the case sine die to study the documents filed by parties in the case.

The Accra Fast Track High Court on January 26, 2009 struck out a motion that sought an order to commit the Governor of the BoG, Dr Paul Acquah, to prison for his refusal to comply with the court's order following Mr Hall's withdrawal of the motion.

Rockshell sued the government for work done in respect of the Keta Sea defence project and had a summary judgement against the Republic on November 20, 2006.

Pursuant to proceedings commenced by the applicant, the court, on January 9,2009, ordered Dr Acquah to pay the amount from the Contingency Operational Account number 0121360058002 to Rockshell International.

Mr Hall, in an affidavit deposed to by him, said several attempts to have Dr Acquah pay the judgement debt had failed and, for that reason, he should be convicted for contempt of court.

It, was, however, withdrawn following an agreement by the parties to settle the matter out of court.

It was after the withdrawal of the contempt case against Dr Acquah that the A-G filed the motion to invoke the supervisory jurisdiction of the Supreme Court to quash the decision of the High Court.