Court of Appeal dismisses Stay of Proceedings Application

Accra, Nov 8, GNA - The Court of Appeal (CA), on Wednesday dismissed an application for stay of proceedings pending appeal, in a case at an Accra High Court between Richmond Aggrey of Trassaco Valley Estates and three Investment Companies.

The companies are Investcom Consortium Holdings S A (now Investcom LLC), a company initially registered in the Lebanon and subsequently in the United Arab Emirates, Scancom Limited, the dominant mobile telecommunications operator in Ghana and Grandview Management Limited, a company registered in the Cayman Islands.

Dismissing the application, the three-member panel presided by Mr Justice B T Aryeetey, with Justices Baffoe Bonnie and Marful Sau as members, ruled that the application failed to demonstrate that there were special circumstances that could have influenced the court to stay proceedings at the High Court.

The Court held that since one of the three companies entered into an arbitration agreement with Mr Aggrey, it could have been unfair for the two other companies if the stay of proceedings application was granted in its entirety to cover all the three companies. The court was of the view that the application was not a proper suit for arbitration, because not all the parties to the suit were parties to the Shareholders' Agreement.

Consequently, the court refused the application for stay of proceedings filed on behalf of Investcom LLC by Mr Ntrakwah and awarded a cost of 10 million cedis in favour of Mr Aggrey and Grandview Management Limited, which was represented by Mr Thaddeus Sory. Earlier in his submissions, Mr Ntrakwah argued that since his client, Investcom LLC had initiated a foreign arbitration agreement with Mr Aggrey, the court ought to stay proceedings at the High Court pending the outcome of the arbitration.

Mr Yonny Kulendi, Counsel for Mr Aggrey, submitted that since the arbitration agreement was solely between his client and Investcom LLC, it was improper for the court to grant the application for stay of the entire proceedings at the High Court in a matter in which the two other parties, namely Scancom and Grandview Management Limited, were not shareholders and therefore parties to the suit.

Coming by a motion filed on behalf of Investcom LLC against Mr Aggrey, Mr Ntrakwah on April 16 this year, applied to the Commercial Division of the High Court, presided by Mr Justice Henry Kwofie, for an order for stay of proceedings pending the arbitration.

On May 31, having heard the parties, Mr Justice Kwofie dismissed the motion but not satisfied with the ruling of the High Court, Mr Ntrakwah took the matter to the CA, praying that it set aside the decision of the High Court and stay its proceedings pending arbitration. In a Notice of Appeal filed on April 17 this year, against the ruling of the High Court, Mr Ntrakwah stated that the judge erred in ignoring the mandatory terms of Section 40 of the Arbitration Act 1961 (Act 38) and the New York Convention.

Counsel stated further that the reasons given by the Judge for refusing the stay of proceedings pending arbitration were not justifiable under the New York Convention, the Arbitration Act or any other law.

Counsel stated that the reliance on Order One Rule Two of the High Court Procedure Rules 2004 by the Judge amounted to a misapplication of the rules of court and thereby occasioned substantial miscarriage of justice.

Mr Kulendi argued that the application for stay of proceedings was misconceived and calculated to occasion delay and injustice in offence to the letter and spirit of the Rules of Court and prayed the Court to dismiss it with punitive cost.

Counsel contended that the appeal by his learned friend on the other side had no likelihood of, let alone, a real chance of success, as it was founded on an improper, flawed and defective appreciation of the Rules of Court and the authorities.

Counsel was of the view that it was in the interest of justice and indeed that of the parties in the suit, that the rights and obligations of the parties were effectually and expeditiously determined without any entertainment of frivolities. 8 Nov 07