Ghana pays another judgment debt for Wellington Boots

..as NDK & CO benefit from judicial faux pas

by Napo Ali Fuseini

In what could safely be described either as a judicial faux pas or a deliberate miscarriage of justice a judge of the commercial courts in 2009 awarded over two million Ghana cedis to NDK Financial Services.

Although the facts of the case and supporting evidence provided by witnesses, Customs Excise and Preventive Service (CEPS) as well as the Bureau of National Investigations (BNI) pointed out that the state could not be liable in the case, Justice Margaret Welbourne (Mrs) awarded judgment totaling 602,609.50 Ghana cedis to the plaintiff as “THE PURPOTED” balance due a suspicious loan contracted by Apex Consult from NDK in 2005 to import service boots for the Prisons Service.

The Judge made the state to pay the amount plus interest at contractual rate of 5% collectible monthly from July 1 2007. An Additional GH¢ 50,000 was awarded as cost against the state. In December 2005,the Ghana Police Service contracted Apex Consulting Services for the latter to supply 5,310 pairs of combat boots to the Prisons Service at contractual sum of GH¢308,378.25.

The Prisons Service contract specification described the combat boots as ‘AVS brand Genuine Leather, direct vulcanized TPR sole boot 12” height graded as per size with 22 eyelets.’

It also stipulated that the contract order for the combat boots was valid for 90 days, and payment for the items was to be made within 30 days of delivery.

Apex consult then approached NDK Financial Services for a loan facility of GH ¢128,236.50 ((¢1, 283, 365, 00) to enable it cover the cost of procuring the boots.

As condition for the approval of the loan the Director General of Prisons at the time, Mr. William K.Asiedu guaranteed for Apex to make payment of the contract sum in the joint names of Apex Consulting Services and NDK Services on condition that order was valid for 90 days

Without informing the Prisons Service, Apex used the previous guarantee it had from the GPS to obtain additional loans of GH ¢85,000 from NDK .

In fact Invoice, tendered in Court, said that the Apex boots arrived at Tema port on March 30, 2006.

But the Ghana Prisons Service refused to take delivery of the items because the Bill of Lading referred to imported 360 cartons containing Gents Leather Half Boots, were different from combat boots as specified in the contract and the 5,310 combat boots had not been supplied, within the 90 days contract period.

The BNI report on the case based on the search done by CEPS/GCNet, also tendered in Court, verified that Apex imported Wellington boots (gents synthetic Leather half boots,) totaling 1,400 pairs and 1,760 pairs of gents leather full boots. The 1,400 full boots cleared on February 9, 2007 were 9” high with 9” eyelets and NOT the specified 12” high, with 11 eyelets.

As a result of Prisons services’ refusal to take delivery of the items Apex could not repay the loan as agreed upon with NDK. When Apex defaulted to pay back the loan, NDK filed a suit against their client and the Prisons Service to recover its money.

NDK prayed the court to grant an order of the sum of GH ¢602,609.50, being the purported balance on the loan as of June 30, 2007, interest at the rate of 5% per month and additional costs.

The figure however increased astronomically to GH¢ 2,800,000.00 (¢28 billion), which was the approved sum and paid out to NDK.

The High Court judge held that “the evidence before me indicated that Ghana Prisons Service “did not take delivery of the boots and, therefore, it did not pay” Apex to enable it to meet its obligations to NDK Financial Services.”

The court said the argument that Apex failed to supply the boots within 90 days was untenable because it did not find, on the face of the contract, any time or deadline for the delivery of the boots.

It furthermore held that the argument by the Attorney General that Apex was required to communicate acceptance or execute some documents, while in another breath alleging that there was a contract but Apex failed to deliver within the specified time, was untenable.

It said the boots were available for inspection on delivery but Ghana Prisons Service failed to carry out the inspection, while no place was designated by the service for the delivery to be effected.

Evidence from both CEPS and the BNI however pointed to the fact that APEX never imported the specified boots as demanded by the contract into the country. More coming