estopped from emertng into contr^t on ^ehaif of company

[1977] 1 G.L.R.

COMMODORE v. FRUIT SUPPLY (GHANA) LTD.

COURT OF APPEAL, A9CRA

30 July 1973

LASSBY, JIAGGE AND KINGSLBY-NYINAH.JJ.A.

law-officers of the company-—Liability for acts of—person l^ld outby company as director even though not formally mpointedr-Third pmtKShiding in good faith with Person as director—Effe^t^mpany^top^f^mdemilut acts of person so held out-Fresumption of regulmty of^matters ofintemtd anangement—Effect ofsecdonslii and 140 of Act 179—Companies Code, 1963 (Act im ss. Ii9 and 140.

Cionmmy law—Contract—Director's powers-Director in fiduciary posUio^Êstopped from emertng into contr^t on ̂ ehaif of company wherein ̂ râiinterests conflict with interests of company-Director not entitied top Pof contract unless permissible by regulations of eonvany.

Tbo respondent company (hereafter called to comity)entered into an oral agreement for the supply and sale (on credit basis) of mi usfrozen flsh to to appellant. Tte ators andto supply of fish to the appellant) were undêo ̂ directorafldone Q., whoeventhoughhe was never appointed ̂ the "JL ,™e atransacted buaness on behalf of to company with to appeltot m rf ^director and to chief ex^tiye of to rompan^ Theon to company's letter-head as one of ite directors. ̂ ofto tore in its btofits by aUocating to him 50 per ̂ t of tte tost ronngoTOfish Q. therefore entrusted the sale of that fish (allocato to himbenefit) to the appellant anddirected tot the proceed of the salebytheappellantintoto aocountofhisprivatefin^tocoi^ rftions the appellant paid various sums of ntoey (bemg Pro^s ^ , q.supplied by the company) to both to managing direct ofNo valid recdpts were given for these paymOTtt. M the do* of ,trading account of to company towrf a debit baiance o 'aga'mst to appellant The company sued for this andcountercWimed for 023,622.90 being ove^ymenis *°^.^ggLny.alleged that apart from payments made to themanagmg director of the coshe.had made some payments (intended for tto com^y) toprivate firm and that those payments ought to he awhed to her c^with the company. The company denied that it had bu^ connection wuh ̂-or his prinatefirm. The trial High Court judge foundfof to «>mpany and tosed to counterclaim. He held that since Q. was never appointo a director m ̂company, he needed rapress authority ftom to company Wore to pas^wreceived from the appeliant couid be appUed to reduce her indebtedness to thcompany. . . , . v. j

On appcEd, counsel for the company contended that since th© appellannotice of a letter, exhibit G3 (written on 16 November 1968 ̂ 7 ®director of tbe company to the Ghana Cold Stoi^) to the effect that Q«

a.L.B. 1977 (VqI. 1)

242 Gluiiui Law Reports [1977J 1 O.L.R.

ontitlcd to act on behalf of the company only in the absence of the manaainttairector, the appellant was not entitled (aa wrongly contended by hor counsel)

(1856) 6 El. & Bl. 327 end«te OS from 16 November 1968, all acts done by Q. on behalf of Ihecompany, Including sums of money received from tite appellant, while thettjanagmg director was available, were ultra vires the powers conferred on O. bythe company. w" v. j

Held, (dlowiiig thfi appeal: (I) even though O. was never appointed adirector of the company, the trial judge ought to Itave held that on the facts.

^ matter of law held out by the company as a director with! 6 to transact business with the appellant. The company was there-fore estopped from denying that Q. was a director.

*!l® '"I® BfUlsh Bank v. Tnnmnd (1856) 6 El. & Bl.1 1. .® ̂ Cdtercd into a contract with a company and dealt In good^^"'^^^"tcompmiy, had tlto right to assiunethat acts within theconsti-

tijtjon and powers of that company had been duly and properly performed,such persons were underno duty to inquirewliethcr acts of internal prellm-maries and ̂ na^ment had been regularly performed. Royal British BankV. T/w/wfl/ir/(supra) applied.

1 hold that at all times material to their

1 appellant was entitled to rely upon all the several matters...Sf conferring apparent authority on Q. to act for and on behalftherefore stood bound by those acts done without

200 apS; S37atpp. 538-539 and Barce/, y. Deere (1828) M. & M.appellant as an outsider, Imd no

139a^ '"88"'"'^ ̂ 'Wn the moaning nnd intent of section?IZ ft Companies Code, 1963 (Act 179), so as to Deludesttdu^ °° f"'® i° Bank v. Turquand ... TheseIntended, I think, to modify the rule .. . Their

the outsider to the transaction knows or oughti ̂ fft as director by the company Is actinginegularly, Ae company will not be clviUy liable. - •

l» 8^1 ̂ultable principle was that, a director of a company.^^1^ .position, was precluded from entering into attansactloii en behalf of the company in which he himself had a

P^nal ioterest wh(di conflicted or might conflict with the interests of the® flduclaty duty to protect the interests of the^P^. Su^ a dliector was not entitled to keep the beneflt or oroflts of

sudt transaction unless otherwise provided for In the^^ttoSs of

tlnw.mider a legal duty, by reason of his flduclary^tlon, Mt to have mixed up his share of the proceeds with what ̂for t^ company. Q. was therefore In law^^tabie to ̂

P^^. 'PI""®"' 'I*® company's'/kt t \ Great Luxembourg Rail, Co, v.

r i' Transvaal Lands Co,v, New Belgium (7Va«f-vooO Land and Development Co, [1914] 2 Ch. 488, C.A. cited.

[1977] 1 G.L.R. Commodore v. Fruit Supply (Ghana) Ltd. 243Cases^refewedjo^^^^^^ jjanfc v. Turquand (1856) 6 El. & Bl. 327; 25

(2) Count^Life Assurance Co,, Re (1870) 5 Ch.App. 288; 39 L.J.Ch.471 * 22 Irf T 537 * 18

(3) Transiaal Co. v. New Belgium Tt^mTlopment Co. [1914] 2 Ch. 488 ; 84 W-Ch. 94; 112 L.T. 965,31 T.L.R. 1; 59 S.J. 27; 21 Mans. 364, C.A. . i

(4) Issaka v. Tailor, Court of Appeal, Cyclostyled Judgments, July-December 1959, p. 30, unreport^.

(5) AsMtey v. Dodoo, Court of Appeal (M tanch), 15 August 1969,unreported;<Ugestedin(1969)C.C. 157.

. ̂'^'^SlB!'72"8f 149^7! T.I.R. 480; 31(7) 1 «

E.r: 256; [1949] L.J.R. 561; 113 J.P. 124; 65 T.L.R. 176; 93S.J. 119; 47 L.G.R. 189, D.C.

(8) Reynard v. Allan (1934) 2 W.A.C.A. 52.(9) Amponay v. Teyi (1937) 3 W.A.CA. 182. _(10) (OppoBg) V. fojfe [19M1 G.LR: 174, S.C.(11) Barclays Bank D.C.O. v. Heward-Mills [1964] G.L.R. 332, S. .

• (12) Barrett v. Deere (1828) M. & M. 200; 173 RR. 113 •(13) MaJolagbey.Larbl[1959] Q.L.K. m. -^n»«t25Beav(14) Great Luxembourg Rail. Co. v. Magnay (No. 2) (1858) 25 Beav.

586; 53 E.R. 761.. .(15) Cudjoe V. Conte Ltd. [1964] G.L.R. 28, S.C

Appeal against a judgment of the High Court, whei^^^^affs* claim for liquidated debt was aUowed and the defendant scountemlaimwas dismissed. The facts are fblly stated tnthe^judgment of Lassey J.a.

Nelson-Cofie for the appellant.U, V. Campbell for the respondents.

Lassey J.A. The appeal was against the decision of ̂Accra, which allowed a claim for a ̂uidated sum of money bytififs and dismissed the defendant's coimterclaim. There was a dispmthe payment by the defendant of an allepd debt against her which arfrom a business transaction with the plaintiflf-company. -Urtiit

The essential features of the dispute may be stat^bnefly: n ^1967, a Umited liabiUty company (hereinafter caUed the wincorporated and styled "Fruit Supply (Ghana) Ltd." Oneand a Mrs. Wadad Ramia were the sole directors. The ®®®P^ ̂formed for the purpose of trading in frozen fish and other nusceUaneousmanufactured provisions which were imported.

Ghana Law Reports [1977] 1 G.L.R.

At all n^terial times, Edward Ramia was the company's chairman andmanagmg director who ran the company. Closely associated with him in^nagmg the afifairs of the company is a man named Attoh Quarshie

hi^lf in building up the companfasping coêrn. He was not appointed a director, but was allowed to

c^4y* director and chief executive in promoting business for thearani ♦ ̂ coHipany to carry out its objects, it was necessary that it shouldpply to p regipred as an importer, and also possess an import licenceto CMble It to mdent for frozen fish from abroad. To satisfy these require-^nte, the company's managing director, Edward Ramia, sought the^smance of Attoh Quarshie, and requested him to arran^Vr thVLm!

Jr ^ an importer and procure for it the requiredIjpnce. Attoh Quarshie undertook to get through these fommlitieson behalf of the company and succeeded.

pmp^y wp granted import licence. It next ̂ t about to openletters of crpit to do business. This exercise involved finding cash andepositmg the same m a bank by the company. The amount which mustbe m local currency should be equivalent to the value of the orders which

SL The.capital sum needed in thisof payment of this sum, consignmentstroren fish could be shipped to the order of the company in Ghana

It tS MrShv have been financially sound,t was pt wealthy, and so was not m a position to infect the amnnntrequired mto the business. It therefore decided to raise that sum bybdtoZdfiiJh®i^ f!!®® y feU on Attoh Quarshie tohelp find Ae bulk of the money needed for the company's business Attoh

" hm ®8ked the defcndwt for the financial assistance which ftecompany urgently needed to start its business.

n~Ji® ^ Willing and ready to help provide all the monevnêd. Her intention, as it turned out, was that she should be eiven^hvenw of aU ̂ frozen fish by the company to sell and make profitTOe defendant laid out toe whole of the money required for the punjosesof the immpMy, and with that amount the company was able t^nenletters of ciît and did business. The arrangement^ repa™ by Ae

° advanced by the defendant was that after the defen-ffh ̂ ̂uped herself from the proceeds of sales of the fish entrustedto te by th® company to the equivalent of the sum she lent,lhe w^ to^tmue to retoive cartons of frozen fish from the company for sale oncredit bMis and pay back the proceeds to the company ^ 'e onthe comnanv®^^ n°'® « ftirthering the business interests of

4 S"®"*"® permitted to participate in the profitsservices on behalf of the company he received notb'âuaging director instract^^tAttoh ̂ rshie should be given 50 per cent of the last consignment of

frozen ̂ to sen for his own benefit. Attoh Quarshie in turn entrusted thesale of his aUocatidn offish to the defendant, and directed that paymentOf the proceeds therefrom should be made into the account of a private

[1977] 1 G.L.R. Commodore v. Fruit Supply (Ghana) Ltd. 245

firm under which he traded. The firm was first named Assatoh SuppUersbut was later changed to Assatoh Ltd.

The volume of sales of the early consignments of the frozen fish whicharrived showed that the company's, business with the defendant wassuccessful, and that relations between all the parties engaged in the fishselling transaction were close and based on mutual trust. But m thelater months of November 1968 and February and March 1969 respectively trade between them became less prosperous, and difficulties aroseover payments for quanUties of fish sold and delivered to the defend^t.It seems that Edward Ramia, Attoh Quarshie, and the defendant hadknown each other for quite a long time in the fish business, since 1964.

The method of business adopted was that when the consignments offish arrived, they were first taken into custody by the Ghana Cold StoresLtd which provided cold storage facilities for preserving fish. From thecold stores issues were made available to the defendant from time to timeonly on instructions from either Edwaid Ramia or Attoh Quarshie.The evidence led showed that in tlje course of their business dealings, bothEdward Ramia and Attoh Quarshie took sums of money from the defendant on behalf of the company. The money was often demanded andcollected at random, and the defendant said the petty cash she wasobliged to pay out on each occasion represented proceeds of fish she soldfor the company. , ^

It seems there was no arrangement made as to how payments were tohave been made by the defendant to the company for fish she bought oncredit from the company. But it was said the nature of the business ttansac-tion between the parties was such that it involved unexpected and qmckrequests for petty cash from the defendant by Attoh Quarshie and EdwardRamia respectively from time to time. The sums represented the proc^dsof fish the defendant sold for the company. No Valid receipts or wnttenacknowledgements were given. Instead, small paper-writmgs caUed"chits'* were sometimes issued to the defendant for the moneys she hadgiven out in this manner. Some of these chits were produced in evidence atthe hearing. No evidence was offered to show that the custom or Prachceexisted in the fish trade whereby sums of money representing sales of fishwere collected against these chits, but it was stated that such a practice orusage had grown up among the traditional fish dealers.

When the balance sheet of their trading account of the company waseventually drawn up at the close of business in the months of November1968, and February and March 1969, it reflected a debit balance ofNCI6,601.50 against the defendan[. The company demanded that thisamount be paid, but the defendant resisted settlement on the ground thatshe had already accounted fully for the cost of the fish sold to her oncredit. As the amount remained unpaid, the company was obliged toinstitute an action to recover it plus interest calculated at the rate ofeleven per cent from Februaiy of 1969 up to date of judgment.

Apart from her general denial of the debt, the defendant did not seemto have been in a position at the time the money was claimed to dispute

I

Ghana Law Reports [1977J l G.L.R.the accuracy or correctness of the figures in the statement of account so farpresented by the company. But in her statement of defence she seemed to

demed that she owed the amount claimed by the company. Second she

/Sfat^h nd <0 Attoh Quaishie through his private firmu V*' purposes of the company. In her third defence^ch was by way of an amendment, the defendant raised a question of

comply law. In it she alleged that the company coLtitSAttoh

defeXto appiTjfc' 'T'"'in iri , i J*®.*^ ®'®''" account with the company to reduce hermdebt^ness. And lastly, the defendant pleaded Lt she had mnrflltd P®y™®tts to Edward Ramia or Attoh Quarshie or to Assatoha™ company's account or to a comwSaU^,n o^^ny ofthem which sums were in excess of the sum claimed on behalf oi^tbacomply. She therefore counterclaimed for the over-pavmLl wh^hshe 5aid amounted td NfZ23,622.90. . yments which

witÂrsaid^nb^'r?^^ company denied that it had business connection

relation to their business acfavSo ® «? °^ôth parties in

0«£3 SS " aMond 1. K.,below wS thfêTSt o? ♦''®counsel for thêXtê a / '®®«®''original ground of appeal to the aff^tif^' .1. ,®'"ctly m terms of thefinding that the defendant was liahia to tK learn^ judge erred inin the writ of summons without fir«t the sum mentionedadmitted by Attoh Quarshie to have b^ madl°fa paymentscompany. Mr Ne1finn.r^nfiA tsA... *• made for the purposes of thejudge had ascertained the total argued that if the learned'creit of thHeSn^t ̂ oS trith «PPlied that sum to the

overpmd the company. He fhrther submitted that the iudrathought wrongly that Attoh Quarshie as held out by the company

(1977] 1 G.L.R. Commodore v. Fruit Supply (Ghana) Ltd. 247

express or actual authority from the company before he paid over themoneys collected from the defendant to the company*s accounts. He saidAttoh Quarshie as a director or an agent had ostensible authority totransact the particular kind of business with the defendant, and that theduty of his office necessarily involved collecting payments for the companyand not for himself privately.

The contrary argument of learned counsel for the company on thepoint was that, if the total debit balance against the defendant was compared against her aggregate payments for the fish sold to her, includingthe payments said to have been received by Attoh Quarshie or throughhis private firm Assatoh Ltd., and also allowing for necessary adjustmentsin the accounts, the resulting balance still reflected a debit in the sumof approximately ̂17,000.00, and which amount was near the sum of(2^16,601.50 claimed by the company.

I have found great force and^ persuasiveness in this submission oflearned counsel for the company, but it does not seem to me to compelthe conclusion that the accounting figures reflected in the statement ofaccount presented on the company's behalf, can be said to have revealed init the true state of the parties' trading accounts at the end of the tradingperiods withdut properly bringing into this account, the jpayments whichin law were attributable to the company's account in reducing the defen-^dant's indebtedness, if any, to the company.

On proper consideration of the evidence as a whole ancj thb variousamounts mentioned, it appears that the* defendant has ans^rs to thecompany's case.. In my judgmenc, the evidence established that the learnedjudge- reckoned that the defendant was liable Solely on the basis that theamount reflected in the balance of account struck in the wmpany'sbook was correct. As to the defendant's liability, the judge seemed to havepreferred Attoh Quarshie's evidence concerning the sources 4)f the payments. But the judge's subsequent addendum to his conclusion on thepoint makes it quite clear that he was less confident as to whether or notthe payments were to be treated ds Attoh Quarshie's own, or for transmission to the company's accounts. The learned judge observed in his judgment as follows: "thedefendant may recover the payments made toAttoh (juarshie." This shows that the judge's view was not in acceptanceof the legal character of those payments in the hands of Attoh Quarshie,and which, to my view, he wrongly omitted to bring into account beforedeciding the defendant's liability. . .

In my opinion, nothing else was involved in the trial of this casp thanthe problem of investigating the trading accounts of the company and ffiedefendant in relation to their fish selling transaction in which accountmust be taken of all the credits made available to the company's .officersfrom time to time by the defendant. It is significant to note that EdwardRamia himself admitted in the evidence that "the defendant sometime^paid me moneys. She has once paid me in the house, I did not give her anyreceipt for it." It was a matter of regret that the learned judge failed tohave dealt with the effect of this pifece of evidence.on the defendant'sliability to the comipany for the fish not paid for.

248 Ghana Law Reports [1977] 1 G.L.R.

The evidence of Attoh Quarshie as to sales of the company's fish in sofar as the defendant's account was concerned was relevant. Attoh Quatshiesaid:

"Ramia and I divided the remaining fish into two. I gave mine to thedefendant to sell for me. Ramia took out his fish. The defendant toldme that she bought some of Ramia's fish for sale. I cannot rememberthe date of this transaction. When the defendant told me this Iquarrelled with her because both of them had agreed not to dobusiness. After that the fish which she got from Ramia it appears thatthere was quarrel over it."

Attoh Quarshie further stated in evidence at the trial that:"I received some of the profits because I was a director. The defendantalways paid my profits through the bank. On a few occasions she paiddirectly to me. My bank was the Ghana Commercial Bank, Temaand High Street, Accra."

It is an essential element of valid accounting that the debits and thecredits of the accounting parties concerned must be considered before atrue balance is struck. If the learned judge had applied this principle ofaccounting to the circumstances of this case, he ought to have determinedhow much of the profits from the sales of fish which the defendant paidover to Attoh QuarsWe personaUy. This seems to me to be relevantD^use Attoh Quarshie's evidence at the trial was that the defendant hadlimy paid for the company's fish entrusted to her for sale. FurthermoreIf after the division of the last consignment of frozen fish, the proceedsfrom the sale of the one-half were to be appropriated by Edward Ramiapersonally, then, as a director in the company, unless it was shown that thearticles so authorised, he ought to be held accountable for proceeds ofthose sales to the company.

It is quite obvious that in this case the learned judge erred in notconsidering the legal position as to the defendant's liability but seemed tolave concluded the case against her on a somewhat factual basis. It is,therefore, necessary for this court to examine the legal basis of his conclusion to see if it was righf. The learned judge concluded the liability to thecompany in these terms:

"The defendant in this case, even though an illiterate, is one of themost successful business women in the country. She was aware thatthe plaintiffs were a company and must have truthfully made payment to Attoh Quarshie hoping that they will reach the plaintiffs.But in so far as the plaintiffs are a limited liability company, and thereis no evidence that the plaintiffs had authorised payments on theirbehalf through Attoh Quarshie, the defendant, from the statement ofaccount, is still indebted to the plaintiffs for the amount claimed."

Fron\^thc above conclusion, broadly two questions seem to arise in myopimon. They are these: (1) Was Attoh Quarshie a director of the company? (2) If he was not, did the company hold him out ̂ such to transact.

[1977] 1 G.L.R. Conunodore v. Fruit Supply (Ghana) Ltd. 249

business with the defendant? The first question was factually answered bythe learned judge in the negative. But it was submitted that he was wrongin his finding of fact. The judge decided as a fact that Attoh Quarshie wasnever appointed a director in the company, and that there was n<^ evidencethat he had instructions to receive payments from the defendant onbehalf of the company. The question is: Was the judge right in so deciding ?The contention on behalf of the company was that the judge rightlydecided that Attoh Quarshie was not a director because there was noevidence that he was ever appointed to such a position in the set up of thecompany.

As the company is an artificial person, it can only act normally throughhuman agents. These agents are usually the directors. From the evidenceit is clear that two persons were actually associated actively with therunning of the company as a going concern. They were Edward Ramiaand Attoh Quarshie. Of these two persons only Edward Ramia was infact appointed a director in the company.

As between the members of the company themselves, the documentaryevidence revealed that Edward Ramia and Mrs. Wadad Ramia wereproperly appointed directors. The evidence about Attoh Quarshie*sclaim that he was a director seems to me to be rather slight. EdwardRamia said in evidence that the company proposed to appoint AttohQuarshie a director, but it never did. Even though Attoh Quarshie claimedto be a director, he did not produce the company's resolution apik>intinghim as such. Furthermore, the returns of names of directors for thepurposes of section 27 (1) of the Companies Code, 1963 (Act 179), gavethe names of the directors in exhibit F, but it did not include AttohQuarshie.

On the oral as well as the documentary evidence on record on thisissue, I think the learned judge was fully justified in finding as a fact thatAttoh Quarshie was not a director. Even if Attoh Quarshie was not formally appointed a director, the crucial question was whether the companyhdd him out as such to transact business with the defendant. It semns thelearned judge did not consider it legitimate to go over and considerwhether Attoh Quarshie had authority to conduct the business of thecompany with the defendant. The court merely described him as **a sortof frontman for import licences** for the company. But the defendantdepended on the holding out as part of her defence, and her counsel putthe holding out in the forefront of his further submission in support of theother limb of the defendant's ground of appeal alleging misdirection by thejudge.

Learned counsel for the defendant submitted that the judge's conclusion was wrong in so far as it was based on a misapplication of the relevantprinciple of company law. He claimed that even if Attoh Quarshie was notin fact appointed a director, the company held him out as such and hetransacted the fish selling business with the defendant on his company'sbehalf as director, and, therefore, the company was estoppi^ from denyingthat he was so held out. Counsel further pointed out that if the companyso held out Attoh Quarshie as a director, then it follows as a matter of law


that he had ostensible authority to do all things within the scope of theoffice, including receiving payments from the defendant for the companyhe represented#

To this submission on a point of law, learned counsel for the companyrightly conceded, in my view, that if the indications on the evidence werethat the company so held out Attoh Quarshie as its director with authorityto transact business with the defendant, then the company would beprecluded from denying that he was a director, and would also be boundby the acts done within the scope of Attoh Quarshie*s office.

It seems plain to me on the facts as found that Attoh Quarshie conducted business negotiations with the defendant in the faith that he wasa duly appointed representative of the company, and, therefore, as againstthe defendant, the company could not be heard to say that Attoh Quarshiewas not its director.

The company denied that it had business connection with AttohQuarshie and appointed him as its agent with authority to conduct itsfish selling business with the defendant. The learned judge found as a factthat Attoh Quarshie was not a director, but the point at issue was that thejudge ought to tove gone on fbrther to hold that Attoh Quarshie was alsoheld out M a dirôr by the company to do its business. In ̂his case, ifone goes through the oral evidence tendered and also examines the severaldocuments and ootTwpoênce admitted into evidence, one can seerepeated instances of Attoh Quarshie*s exercise of authority as a directorin control of tlê company's business.

The set up in Fruit Supply (Ghana) Ltd. is easy to envisage. It was animportii^ and a fading concern, and as I read some of the several lettersproduced in evidence, I cannot help forming the impression that thecompany was partially controlled by Attoh Quarshie who exercisedauthority over its business aflfeirs as if he were tlie regular chief executive.But 1 t|ui^ the right starting point of Attoh Quarshie's exercise of authorityon behalf of Ae company was in respect of dgning the appUcations for thecompany to -^ registered as an importer, and this he did with the con-mirrence of the ffianadng director of this company. Edward Ramia.Besides, Attoh Quarshie s own evidence at the trial shows that he wasnot simply held out as^ having authority as a director, but that he actuallyacted as such in relation to his dealings with the defendant in particular.Attoh Quarshie himself said, inter aUa: "I was a director of the company.As a dnector I wote letters to the Ministry of Trade for the company tobe registered as importers ... As a result the company was registered."His evidence was confirmed in this respect by the testimony of an officialfrom the Ministry of Trade, Accra. The letters such as exhibits K, L, Mand N all provide adequate testimony of the fact that as early as the forma-tion of the company, Attoh Quarshie had emerged, judging by the variousactivities he undertook for the company, as a much more important chiefexecutive than the company's managing director himself. Thus when thecompany needed at t^ outset money to open letters of credit in the bankso as to start business, Attoh Quarshie persuaded the defendant to provide

[1977] 1 O.L.R. Commodore v. Fruit Supply (Ohana) Ltd. 251

the capital needed for the company's business and this act was clearly onewhich was within the ordinary ambit of the authority of a director ormanaging director.

The company's managing director, Edward Ramia, denied in eviden^that Attoh Quarshie was a director of the company, but admitted that hisname was printed on the company's letter^head as one of its directors.Edward Ramia said:

"1 know Attoh Quarshie. He is not a member of my company. Wewere to make him a director of the company, We did print papers onwhich he appeared as a director. But he was never confirmed becausehe failed to contribute the necessary shares to make him director.He is not the managing director of the company."

Section 198 (1) of the Company's Code, 1963 (Act 179), provides that:"Every company shall in all tra^ circulars and business letters on or inwhich the company's name appears state in legible characters with respectto every director ». .(a) his present forenames and surname." In ̂ mpli-ance with this requirement, the company printed the names of its directorson all its letter-heads, and among the directors was Attoh Quarshie. Inexhibit F, a l^ter dated 28 April 1968, it is stated that the company hadpowers to remove the name of a director from its -books if the companyceased to regard Um as a director. But Attoh Quarshie's name was nevercancelled from the company's circular letters as a director. This shows thatalthough in fact he was never appointed a director, the company, however,held him out as such in its transactions with outsiders or third parties,including the present defendant. The evidence showed that the whole ofthe company's undertaking with the defbndant was concluded by AttohQuarshie as director.

The manager of the Ghana Cold Stores Ltd., which stored the consignments of the frozen fish on behalf of the company before they weredelivered to the defendant, gave evidence at the trial. He said his organisation dealt with Attoh Quarshie as the company's director, and tookinstructions from him in his capacity as such in relation to the deliveriesoffish to the defendant. The manager said:

"Attoh Quarshie was once our customer with the defendant. I knowon the letter-heads of Fruit Supply, Attoh Quarshie is a director.I have a letter from Fruit Supply showing Attoh Quarshie as adirector . . . Attoh Quarshie wassigning for Fruit Supply. He hasauthority to this effect."

The manager, continuing his evidence, added fUrther that: "In Februaryand March 1969, 1 refhsed to deliver fish to the defendant if I did notreceive a letter from Ramia or Attoh Quarshie and Ramia gave contradictory instructions as to the release offish to the defendant." The managerexplained that:

"When Ramia came 1 insisted on receiving a letter from them withtheir signatures. When I received exhibit L, I toew Attoh Quarshie

252 Ghana l^w Reports [1977J 1 G.L.R.

and Ramia were both directors ... On the strength of exhibit D21 issued to the defendant 2,985 cartons of Ramia's fish ... AttohQuarshie dealt with us for the plaintiflf. Attoh Quarshie has beenrepresenting Ramia at the fish harbour.**

Exhibits Dl, D3 and L, letters written on the company*s letter-heads,all diesmbed Attoh Quarshie as director. When later a dispute seemed tohave arisen between the managing director of the company, EdwardRamia, and Attoh Quarshie over the release from the Cold Stores of thecompany*s fish to the defendant, Edward Ramia, the managing director,wrote a note, exhibit D3, to the manag^ of the Ghana Cold Stores Ltd.in these terms: "Please note that our director, Mr. Attoh Quarshie, ishereby fully authorised to store fish for this company, and to withdraw,transfer or do whatever he considers appropriate to do during the absenceof the managing director of this company." The fair inference, in my view,from the terms of this letter is that the company acknowleged that AttohQuarshie was its director.

In view of the ample proof provided on the evidence with regard tothe way in which Attoh Quarshie was closely associated with the company,and also considering the varied nature of the business assignments heundertook on behalf of the company generally, it is impossible to escapethe conclusion that he was a director held out by the company. From thisit follows that, even thoujgh the learned judge rightly decided as a matterof fact that Attoh Quarshie was not a director, he should have gonefurther to hold that nonetheless, as a matter of law, he was held out assuch. To this extrat I think the learned jud^ was in error.

On the question whether Attoh Quarshie*s actual authority to transactbusiness with the defendant on behalf of the company necessarily conferredan ihiptiiBd authority on him also to receive i^yments on the company'sbehalf, the learned judge was of the view that Attoh Quarshie neededexpress instruction from the company before those payments he receivedfrom the defendant or pai<l through his'private firm styled AssatohLtd.for die benefit of the company, could be applied for the coihpany's purposes. In this regard, learned counsel for the company in a submissionin support of the conclusion in favour of the company by the court below,r^ed on the effect of the terms of exhibit G3, the letter written in Novem-

of 1968 on behalf of the company and addressed to the manager ofthe Ghana Cold Stores Ltd. That letter puiported to have imposed somelimitation on the exercise of authority by Attoh Quarshie as director inrelation to the company's business aflfairs. The letter was signed by EdwardRamia. as m^aging director on behalf of the'company.

Therargumient of counsel for the company, based on the effect of theletter was ̂thht Attoh Quarshie as. a director could bind the companyonly by acts performed on behalf of the company in the absence of theCO]D^ny*s managing directorJ ̂ The necessary inference from such anar^ntent being diat as from 16 November 1968, acts purported to havebeen done on the company's behalf, including receipt of money payments

[1977] 1 G.L.R. Commodore v. Fruit Supply (Ghana) Ltd. . 253

from the defendant in particular, while the managing director was available, were invalid and therefore ultra vires the authority conferred onAttoh Quarshie as a director.

This argument raised the important question of the nature or kind ofthe authority exercisable by Attoh Quarshie as a director held out by thecompany, and the extent of the exercise of that authority in so far as itincluded the authority to receive payments from outsiders such as thedefendant on the company's behalf.

Learned counsel for the defendant put the reply to this submission onthe point raised in the argument of learned counsel for the companymore narrowly, and, in my view, more acceptably, in this way: He repliedthat, firstly, the normal consequence which followed from AttohQuarshie's exercise of authority in respect of the kind of business transaction he was held out as director to conclude with the defendant necessarily involved his receiving money payments from the defendant for thecompany. Secondly, he submitted that, as between the members of thecompany themselves, the letter, exhibit D3, might be taken to have limit^the exercise of authority by Attoh Quarshie in running the company'saffairs, but as between outsiders like the present defendant and the company, the company was in law bound by all the acts done by AttohQuarshie in relation to the defendant, including receiving payments onits behalf, and no matter at what period of time so far as the transactionfell within the scope of his office as director.

Learned counsel fof the defendant further submitted that the defendantwas entitled to take advantage of the rule in Royal British Bank v. Tur-quand (1856) 6 El. & Bl. 327, because she was not a member of the company, and therefore she was not concerned with matters of internal ordomestic management of the company. Explaining the rule, Giffard L.said in Rt Coimty Life Assurance Co. (1870) 22 L.T. 537 at pp. 538-539as follows:

"The company is bound by what takes place in the usual course ofbusiness with a third party, . . . provided that . . . the third partydeals fairly and bona fide . . . with persons who may be termedde facto directors. . . that is to say, persons who might very possiblyhave been de jure directors."

In that case it was decided that the acts of improper directors were bindingon the company because no steps had been taken by the company to havethem removed.

But the principal argument on behalf of the company seems to showthat by the combined effect of sections 139 and 140 of the CompaniesCode, 1963 (Act 179), and also the restriction contained in the letterexhibit D3, the defendant was debarred in this case from relying absolutelyon the rule because she knew or ought to haVe known that after 16November 1968, Attoh Quarshie's authority to order the release ot thecompany's fish from the Cold Stores was exercisable only in the absenceof Edward Ramia, the managing director. It was.also claimed that the

2S4 . Ghana Law Reports [1977] 1 G.L.R.

defendant knew or ought to have known that after November 1968 allthe supplies of fish which she got from the Cold Stores on the authorityof Attoh Quarshie was fish belonging to Attoh Quarshie personally, andnot as a director of the company, and, therefore, it was wrong to haveregarded the moneys paid to him or through his private company asmoneys intended for the purpose of the company.

I think it was common ground that the defendant knew that AttohQuarshie, apart from being held out by the company, had an interestin the company*8 fish transaction. The defendant Imew that not only didhe participate in the profits from the sales of the fish, but also that hewas specifically allowed to take and sell for himself SO per cent of the lastconsignment of the frozen fish. It was also common ground that proceedsof the sales of fish by the defendant were paid indiscriminately into theaccounts of the company, or the Tema bank account of Assatoh Ltd.There was nothing unusual about the nature of the business arrangementbetween Attoh Quarshie as director and the defendant, and it was notpleaded on behalf of the company that payments made by the defendantafter November 1968 were payments for Attoh Qiiarshie*s privatepurposes.

In my opinion, even if the defendant had nc^ce of the fact that all thefish which was supplied to her from the Cold Stores after November1968, was for Attoh Quarshie privately and not for the company, andthat the payments therefrom were Attoh Quarshie*s own but the defendantsought now to treat those payments as payments belonging to the company, X cannot conceive how that can be considered as an irregularityof which the defendant must have knowledge so as to disentitle her fromdaiming that the moneys she paid to Attoh Quarshie were intended byher for the purposes of the company.On the facts, the defendant as an outsider, had no knowledge of any

irregularity within the meaning and intent of sections 139 and 140 of theCompanies Code, 1963 (Act 179), so as to preclude her from relying onthe rule in Royal British Bank v. Turquand (supra). It seems the matterturns mainly on the true construction of the effect of these sections. Thesestatutory provisions are intended, I think, to modify the appjication ofthe rule in British Bank v. TUrquand. Their combined effect is that if theoutsider to the transaction knows or ought to know that the person heldout as director by the company is acting irregularly, the company willnot be civilly liable. The Turquand rule only protects outsiders to thecompany.

I think there is a fUrther reason in this case why the decision of thecourt below is not sustainable at least on the ground on which it seemsto have been based. Under the doctrine of equity applicable to companiesAttoh Quarshie was not entitled in law to collect and retain for himselfpersonally payments intended for the purposes of the company of whichhe was held out as a director. The general equitable principle is that adirector of a company, by reason of his fiduciary position, is precludedfrom entering into a bin^ng transaction on behalf of the company in


which he himself has a personal interest which conflicts or may conflictwith the interests of the company while he is bound, by his fiduciaiyduty, to protect. The normal consequence which follows from the application of the equitable doctrine is that if a person held out by a companyto enter into business relations with a third party on its behalf, engagesin private and separate business arrangements with the third party insuch a manner as to place his own personal interests in conflict withthose of the company he represents, he is not entitled in law to keep thebenefit or profits for himself, unless he is allowed by the articles of association of the company so to do. A director who allows his personal in^reststo conflict with those of the company under the rule is accountable tothe company to the extent to which he has enriched himself at the expenseof the company. ^

In the present case Attoh Quarshie as director was allowed by tnecompany to conclude his own private business arrangements with thedefendant while he at the same time negotiated with the defendant otist-ness terms on the same lines on behalf of the company. He actumlyparticipated in the profits of the company, and, as compensation for hisservices to the company, Edward Ramia allowed him to have 50 per centof the last consignment of the company's frozen fish for sale at a profit.Attoh Quarshie, under his own private arrangments with the defendantfor the sale of his fish, delivered his half portion of the fish to the defendant,and directed her to pay the proceeds thereof into the account of AssatohLtd., his private firm.

At the trial, Attoh Quarshie gave evidence for the defendant.. Therelevant portion of his evidence is as follows:

"After that the defendant started paying the profits to Ramia andmyself. Ramia told me that the defendant was paying but shestill owing. She paid all my profits to me. As fhr as I am conoernroithe defendant is not owing the plaintiff (that is, the company). Thecompany is not the sajne as Ramia and myself."

Then later Attoh Quarshie continued and said:"Ramia and I divided the remaining fish into two. I gave mine to thedefendant to sell for me. Ramia took out his fish. The defendant tolame she bought some of Ramia's fish for sale... When the defendaiUtold me this, I quarrelled with her because both of them had agreednot to do business again. After that the fish which she got fromRamia, it appears there was quarrel over it... I asked Ramia ̂reduce the price of fish for the defendant, Ramia agreed and reducedthe price. I did not know if she paid the amount to Ramia or not.After this, the plaintiff did business with the defendant. We got morefish. In 1969 we got licence. We did business with the defendant. . .1 had some of the profits. The defendant paid half of the profits tome. She did not pay all. I do not know if she pmd Ramia's to him.I do not know the account either. This was the first consignment in


1969.1 t^k we got only one. I received some of the profits becauseI was a director. The defendant always paid my profits through thebMk. On a few occasions she paid directly to me. My bank was theGhana Commercial Bank, Tema and High Street, Accra. I introduce one Mark Laryea to the defendant to assist her. Mark Laryeareceived some of my profits from the defendant and paid them intomy account. I was operating accounts at two bankers. I had othernamesi Some of the moneys were paid into the name of my companyAssatoh." f

Attoh Quarshie concluded his evidence-in-chief as follows: "We keptbooks of accounts. The books were in Ramia's office. So far as fish isconcern^ there is no one owing the plaintiff.'' When he was cross-exammed, Attoh Quarshie had this to say in addition: "My companydid not receive any money for the plaintiff."

The exhibits mentioned in the evidence of Attoh Quarshie were allr^rds of various sums of money he collected from the defendant fromtinw to time in the course of their fish selling business, and his own^dence revealed that he did not account to the company for these moneys.He treated them as for his own purposes. The source or character oftne payments was that these were moneys paid to be transmitted to thecompany's accounts with the defendant.

The question now is this: Was Attoh Quarshie allowed by law to payffimself out of moneys in his hands for the company and intended by thedefendant in reduction of her indebtedness to the company? The answerwould seem to me to be plain no! If he did, the legal consequences werethat, unless it could be shown that the company at its board meetingapproved of ratified what he had done, his fiduciary position as a directoror a person held out by the company, disentitled him from keeping thepayments for himself. Even though the company, acting by the managingdirector, Edward Ramia, in fact knew of and acquiesced in Attoh Quarshieconducting similar business privately with the defendant and receivingpayments from her, the circumstance that there was some conflict betweenthe company and the defendant as to the payments for the company'sfish, and the fact that it was particularly stated in the evidence of thedefendant that the payments she made to Attoh Quarshie were attributable to the company's accounts, precluded Attoh Quarshie from treatingthe moneys as his own. The legal position was that although AttohQuarshie was entitled to 50 per cent of the profits of the sale of the company's frozen fish, he was at the same time as director in the companyunder a legal duty not to have mixed up his share of the payments. Asit was not shown in the instant case that the articles permitted him tohave done so, he was an accountable person to the company for all themoneys paid to him by the defendant on the company's behalf.

It is true, the learned judge of the court below did not rest his decisionon the fact that the payments by the defendant to Attoh Quarshie orthrough his private company, Assatoh Ltd., were for him personally.


but his final conclusion necessarily carried that consequence. It follows,therefore, that if the payments were in law payments for the company,then the final conclusion and the reasons supporting it were not tenable.The defendant is an illiterate woman and cannot know the niceties ofthe Companies Code. The learned judge himself observed in his judgmentas follows: "The defendant in this case, even though an illiterate, is oneof the most successful business women in the country." The judge'sfurther conclusion showed that he seemed to have been satisfied that thedefendant made payments intended for the company, for, he said: "Shewas aware that the plaintiffs were a limited liability company."

As already observed, the judge did not determine the total sum paidby the defendant to Attoh Quarshie or through his private firm AssatohLtd. as he ought to have done in the first instance. Furthermore, thelearned judge ought to have held as a matter of law that the paymentsto Attoh Quarshie as an agent of the company were for the company andnot for the private purpose of Attoh Quarshie himself. This was sobecause under the rule in Royal British Bank v. Turquand and section 140 of the Companies Code, 1963, the defendant was not concernedif in actual fact Attoh Quarshie failed to have brought the sums paid tohim as the company's director into the account books of the companyfor the purpose of taking accounts between the defendant and thecompany in relation to their business transaction.

There is no doubt that a question of arithmetic was involved, and,as this court only exercises an appellate jurisdiction over this case, itcannot determine on the material available on the evidence how muchthe defendant overpaid the company altogether so as to be able to reassess her liability, if any, in the company's books of accounts. In myopinion, any calculation based solely on the figures of account mentionedin the statement of account presented by the company without referenceto the total payments in the hands of Attoh Quarshie would be incorrect.In the circumstances, therefore, I consider that the fairest method is thatthe whole matter ought to be sent back to the appropriate forum forproper accounts to be taken.

For the various reasons which I have tried to give, I would be in favourof allowing the present appeal, and it is accordingly allowed. The judgment given by the High Court, Accra, in favour of the company in thiscase is hereby set aside, including the order as to costs. Such costs, ifpaid, must be refunded. The case is remitted to the High Court to betried de novo by another judge. Costs of the abortive trial to abide theresult. The successful appellant who is the defendant will be entitled toher costs of the appeal in this court fixed at J2287.98. Court below tocarry out.

Jiagge J.A. This appeal is to have set aside a judgment entered inavour of the plaintiff-company in the High Court, Accra, for the sum of16,601.SO being cost of fish sold by the plaintiffs to the defendant during

O.L.R. X9T7 (Vol. 1) 17


December 1968 and Febru^ and March 1969. The defendant admittedreceiving fish from the plaintiflf-company (hereafter called the company)^d her defence was that she had paid to the plaintiff-company throughits director, Attoh Quarshie, the total amount due to the company andthat she had even made overpayments to the said company.

The learned trial judge found that the said Attoh Quarshie was nota director of the company and that: "He was a sort of a front man forimport licence and benefitted thereby." The learned judge also made thefollowing observation:

"He [meaning Attoh Quarshie] introduced Mark Latyea to the defendant to assist her. I can well believe that payments were made by thedefendant to Mark Laryea which went to Attoh Quarshie. In evidencehe said the defendant did not owe the plaintiffs. The defendant in^8 case, even thougih an illiterate, is one of the most successfulbusiness women in the coimtry. She was aware that the plaintiffswere a limited liability company and must have truthfully madepayments to Attoh Quarshie hoping that they would reach the plaintiffs. But, in so far as the plaintiffs are a limited liability companyand there is no evidence that the plaintiffs had authorised paymentson their behalf through Attoh Quarshie, the defendant, from thestatement of account, is still indebted to the plaintiffs for 4e amountclaimed.

The defendant may recover payments made to Attoh Quarshie."The regdations of the company were admitted in evidence as exhibit E

and regulation (4) of the regulations gives the names of the four directorsof the company as Wadad Ramia, Edward Ramia, Victoria Adobea andJohn Francis Cobbina. Attoh Quarshie*s name was not listed as one of thefirst directors of the company. According to the evidence of EdwardRanfia, the managing director, Attoh Quarshie was neither a memberof the company nor a director of it. Both the oral and the documentaryevidence support the finding of the learned trial judge that Attoh Quarshiewas never a director of the company.

However, the grounds of appeal were that:"(1) the learned trial judge misdirected himself in law when he held

that Attoh Quarshie was never a director of the plaintiff-company and so in effect could not properly receive moneys due tothe plaintiffs.

(2) Since the plaintiffs held out Attoh Quarshie as their agent withunrestricted powers there was no need for express evidenceauthorising him to receive moneys on behalf of the plaintiffsfailure of which should render the appellant's payments to himimproper as the learned trial judge erroneously held."

Ramia, the managing director of the company under cross-examination,told the court: "We came to an understanding with Attoh Quarshie thathe should have 50 per cent of the sales of fish that the company ma

[1977] 1 G.L.R. Commodore V. Fruit Supply (Ghana) Ltd. 259

obtain. We were to make him a director of the company. We did printpapers on which he appears as director." Act 179, s. 198 (1) provides:

"198. (1) Every company shall in all trade circulars and businessletters on or in which the company's name appears state in legiblecharacters with respect to every director, jjcludng substitutedirectors appointed in accordance with section 187 of this Code butexcluding alternate directors appointed in accordance with section188 of this Code,

(fl) his present forenames and surname,(b) any former forenames or surname."

The Company by printing on the company's letter-heads theAttoh Quarshie as one of the four directors, gave the impression that theprovisions of section 198 (1) of Act 179 had been compUed with but allthe officers of the company knew that the said impression was lalse.Exhibits D3, Kl, LI, Nl-NlO are all letters written on the letter-headsaforementioned; each holding out Attoh Quarshie falsely as a directorin fact, the second in a list of four directors. Exhibit D3 is a letter dated16 November 1968 and written by Edward Ramia, the managing direaorof the company to the manager, Ghana Cold Stores Ltd^ Tema. eofficial letter-heading of the company shows that Attoh Quarshie wasone of the four directors. The content of exhibit D3 is as follows:

"Dear Sir,

Please note, our director, Mr. Attoh Quarshie,^ is hereby fullyauthorised to store fish for this company, and to withdraw, twnsieror do whatever he considers appropriate to do during the absenceof the managing director of this company.

Yours faithfully,Sgd. Edward RamiaManaging Director."

Exhibit Kl was an application made to the Commissioner of Trade byAttoh Quarshie "as a director of the above-named com^ny ... torspecial consideration for the registration of the company as fthe current year." The application was dated 17 January "official letter-head shows Attoh Quarshie as one of the four djecwrs.The application was signed by Attoh Quarshie as managing director.Exhibit LI was another appUcation made to the Controller of Imports andExports, Ministry of Trade, for an import licence and it was byAttoh Quarshie a director of the company. Each of exhibits Nl-NlO wasan application for "specific import licence" and each was signed yAttoh Quarshie—as director of the company. ct a

The correspondence between the company and the Mimstry of Tradeshow quite clearly that Attoh Quarshie acted not only as a director ofthe company but that he successfully conducted the bnsiness of the company with the Ministry of Trade and obtained all the import hcencesrequired by the company.

2^ Ghana Law Reports [1977] 1 G.L.R.

Raima, the managing director of the company, in his evidenceadimtted: "I have represented Attoh Quarshie as a director of my company before. Attoh Quarshie wrote on our behalf as a director to theMinistry of Trade."

The learned trial judge observed in his judgment as foUows- "It,isclear from the evi<fence in this case that Attoh Quarshie was a greatumuen^ in the. plaintiflf-company. He used his position at the time toobtam import licence for the plaintiffs and no doubt benefitted handsomely." The important case which the learned trial judge failed to con-Mder, however, was that the company knowing very well that AttohQu^shie was not a director, nevertheless held him out as one contraryvto the provisions of the Companies Code, 1963 (Act 179] s 179 andmoreover section 179 (2) (a) and (6) provides:

"179. (2) Any person, not being a duly appointed director of acompany,

(a) who shall hold himself out or knowingly allow himself to be held out as a director of that company, or

(h) on whose directions or instructions the duly appointeddirectors are accustomed to act,

shaU be subject to the same duties and UabiUties as if he were a dulvappointed director of the company:

Provided that nothing in this subsection contained shall be deemedto derogate from the duties or UabiUties of the duly appointed directors, mending the duty not to act on the directions or instructionsOf any other person."

Attoh Quarshie having allowed himself to be held out by the companvas director, was in law subject to the same duties and liabilities as a director. He successfully transacted the company's business with personswho acting in good faith, assumed that when the company held him outas a director, he was in fact appointed one in accordance with the regulations of the company.

However, Ramia, the managing director of the company stated inWs ewdence that Attoh Quarshie was not in fact a director b^ause "hefailed to contribute the necessary shares to make him a director " As a^neial rule, any condition precedent to the exercise of the powers of amrector should be performed, but where the condition is a matter dealing

the internal managment of the company, its non-performance doesn<rt mvahdate transactions undertaken with persons, who acted in goodfaith and without notice of such non-performance. A director acting as% official or an agent of the company has the power to bind the companyto If ce^ mtemal preliminaries are to be gone through by the comWymore the power can be exercised, a person acting in good faith, has noduty to see that the mtemal preliminaries have been observed and heIS entitled to presume that the director has acted regularly in the exerciseof his powers: see Royal British Bank v. Turquand (1856) 6 El. & B1327. On this principle, the company having held out Attoh Quarshie a


a director - oound by his actions in that capacity and is estopped fromdenying that he had the powers he exercised as dirwtor.

However, counsel for the company submitted that even if it wasconceded that Attoh Quarshie was held out as a director, the apj«Uantfaded to prove that she made full payment to Attoh Quarshie tradmg asAssatoh SuppUes. He submitted further that the appeUantfailed to adduceevidence of the payments she claimed she had made but mst^d renderednieces of paper which bore no dates nor any indication of wtot the sumsof money stated therein were in payment of, and that Attoh Qimrshie onp 73 of the record of proceedings made the followmg addimssions.have never received money from the defendant for the plaintiff. Exhibits #,12,13 and 14 were all issued by me. This was money paid to me personauyand not for the plaintiff." -j ...

Section 140 (1) (b) of the Companies Code, 1963 (Act 179), provides."140. (1) Except as provided in section 139 of this Code, the acts

of any officer or agent of a company shall not be deemed to be actsof the company, unless,... . , .

(6) the company, acting as aforesaid, shall have represented the officer or agent as having its authorityto act in the matter, in which event the companyshall be civilly liable to any person who has enteredinto the transaction in reliance on suclurepresenta-tion, unless such person had actual knowledge t^tthe officer or agent had no authority or unless, havingregard to his position with, or relationship to, thecompany, he ought to have known of such absenceof authority."

The learned trial judge misdirected himself when he held that the actsof Attoh Quarshie could not be deemed to be the acts of the conyanybecause he was not a director. The company having represented AttoQuarshie as an officer having its authority to act in the matter, y»s inlaw, civilly liable to anyone who had done business with him as a directorunless such person had actual knowledge or the dicumstances were suchthat he should have known of the absence of such authority: see section140 (1) (b) of Act 179 (supra).

The learned trial judge having made the erroneous decision aforementioned was in no position to consider the important issue whether ornot the appellant in view of exhibit D3 already stated in this judg^Mi^had actual knowledge or that the circumstances were such that she momahave known that as from 16 November 1968, Attoh Quarshie's pow^as director were limited to acting only in the absence of the managingdirector.

Attoh Quarshie denied that the sums of money he received from ttieappdUant which were indicated on the undated pieces of paper were forthe company and that the money was paid to him personally.

Ghana Law Reports [1977] j q.L.R.

ta ̂ tnTindi "ttd onrr.

toown of the absence of authority for him to act for the comnanv Theoaare aU issues mainly of fact on which the trial judge should havetedfag. If the trial judge had. for instance. fZd asTfeiXt ?!,»tliM Of the issue of the undated notes which were tender^ 1 1^^ to Assatoh Ltd. after tt daTof e^Wt D3November 1968. Attoh Quarshie had authority to art ̂ fL ' 'tton even the fact that he acted fraudulently would not affect th?lTabSSL '• tlta sums of mX fo ' wStM undated notes were given, would become part of the

'''' appellant in liquidation of the debt. If however the'^tisfled. for Instance, that the moneys plSdlZ* Ihl^"aM ^ "^t® of exhibit D3. i.l fe X^ber' and the undated notes were siven hv Attnh rtiia..«i.' e _money he had taken from Ar^St foreSi^S^3 ~°?r? ^''® -ofosXe givfn m^he tTmeexhibit D3 mad« it impossible for the appellant to take fi«H • *the wmpM, ftom the Cold Stores on^ amhori^fo^^^ând that the appellant knew or ought to have known that AttoV. nil 5-*had no authority to act for the tmmpaw ex^t^n the »hl ̂managing director, then the undated receipts and sumo ®. of theto Attoh Quarshie or Assatoh Ltd. after the date of exhibitbe ̂ epted in liquidation of the debt due fo tS^^Xy.

The equitable principle is that a director, by reason nf hio fiA •«porition. is precluded frSn entering tato a btotog tXsaXof tto company in which he himself has a personal interXwh^hTOto tto iitor^s of the company because he has fiduciary duty to^?Xthe mterwt of the company; see Transvaal Lands Co. v. New Belgium(Transvaal) Land and Development Co. [1914] 2 Ch. 488 C A

If the appeUant aUowed Attoh Quarshie acting as the director of thecompany to enter with her. to his benefit, into private tra^ôft^!WoX t^ ste "h company which interest he has a duty toprotect, then &he has taken a nsk and should not complain when thewwqu^s affect her adversely. The equitable rule provides howeverttat roch director should not keep the benefit or process Si ternlace^mX regulations of the

Tto learned triri judge failed to consider the main issue befo™ bim <w,dôn. i.e. the issue of the undated receipts wMrittoh Q^Sedaimed were for sums of money he received from the appeUant for Wm^ ̂qnaHy and that they were not for the company. SuldXc^ ofAttoh Quarshie in receiving these sums of money KS to ̂ the


acts of the company within the meaning of section 140 (1) of Act 1797Unless this issue is resolved it is impossible to decide whether or not theappellant owes the company any money.

For these reasons, I agree with my learned brother Lassey J.A. thatthe appeal be allowed, the Judgment of the court below set aside and anorder made for a hearing dc novo by another judge.

Kingsley-Nylnah J.A. I am in wholehearted concurrence with my learned colleagues that this appeal be not only allowed but also that the wholematter be sent back to the court of first instance for a fresh hearing beforeanother judge. I would, however, like to say a few pertinent words ofmy very own on certain material aspects of this case that my colleagueshave not touched upon in their consideration of the matters before usin this appeal. Where there appears to be a repetition of what has alreadybeen stated, it must be understood as putting those matters into strongerperspective to reinforce the oneness of the judgment of this court.

In the substantive suit tried in the High Court, Accra (Coussey J*presiding) the plaiutiff-company*s claim against the defendant was

"for the sum of NfZl6,601.50 . . . cost of fish sold by the plaintiffsto the defendant during November 1968 and February and March1969 . . . which said amount defendant has refused to pay in spiteof repeated demands by the plaintiffs."

A statement of accounts annexed to the writ showed that the figure ofNf2!l6,601.50 represented the balance outstanding from a series ofconsignments of fish made by the plaintiff-company to the defendant.

Not unnaturally, the defendant denied, by her statement of defence,and in her oral testimony, liability in the sum claimed by the company.She said she had . "never bought any consignment of fish fromplaintiff-company," but rather from'Messrs. Assatoh Ltd. This I find notto be quite correct, on the evidence. Furfher to that denial, the defendantaverred in her pleadings that it was the company, rather, that owed herthe sum of Ni2!23,622.90 which represented the total of moneys she hadoverpaid to the plaintiff-company through their agent Assatoh Ltd. (inconnection with that very same fish-supply trahsaction upon which theplaintiffs based their action against her), The plaintiffs of course deniedknowledge of Assatoh LM. The defendant made that sum of NiZi23,622.90the subject-matter of her counterclaim against the plaintiff-company.

It was an admitted fact, at the trial, that the fish-supply transactionbetween the parties herein was based upon an oral agreement Thedefendant urged the case that under that agreement she made dailypayments of moneys to Assatoh Ltd. for the consignments of fish theplaintiffs supplied to her. By a subsequent amendment dated 17 December1969, the defendant averred that all negotiations concerning the transactionwere carried out by the plaintiffs* director and agent, Attoh Quarshie,who also, incidentally, received and accepted all her money payments forthe plaintiff-company.

/


Issue having been duly joined between the plaintiffs and the defendant,their action was narrowed down to the following material questions:

"(1) Whether or not the defendant bought the fish from the plaintiffsor from Assatoh Ltd.

(2) Whether or not the defendant has made part-payments of thetotal amount owed by the defendant on fish supplied to thedefendant by the plaintiffs direct to the plaintiffs or to AssatohLtd.

(3) Whether or not Assatoh Ltd. are the plaintiffs' agent.(4) Whether or not the defendant has fully paid for the fish supplied

by the plaintiffs to the defendant.(5) Whether or not the defendant is entitled to her counterclaim."

As I conceive it, these several significant matters at once placed a dutyon Ae learned trial judge to consider them as arising from proceedingsinstituted by the plaintiffs; and then to examine the transaction as one notexisting between Ramia, or Attoh Quarshie, in their personal capacities,but rather as it was carried out between the plaintiffs, and the defendant!

To me, all these issues were severally and conjointly vital to the partiesinvolved in the transaction before the court. It therefore behoved thelearned trial judge to have carried out an incisive investigation for fairand balanced justice. But he never did, for without seriously consideringthe reli^onship between the three principal parties in the fish-supplytransaction, namely the plaintiff-company (represented by Messrs. Ramiaand Attoh Quarshie), the defendant, and Attoh Quarshie-Assatoh Ltd.,each and all of whom were somehow interested in the proceeds of thetransaction; without carefully attending to the question whether thepayments allegedly made by the defendant to the plaintiffs were in factmade through Attoh Quarshie's Assatoh Ltd.—without judiciouslydirking his attention to such material matters, the learned judge, afterreciting the claim and the defence of the parties herein, and then narratingwhat he thought was the plaintiffs' case, gave judgment in the followingterms:

"The defendant in this case, even though an illiterate, is one ofthe most successful business women in the country. She was awarethat the plaintiffs were a company and must have truthfully madepayments to Attoh Quarshie hoping that they will reach the plaintiffs.But, in so far as the plaintiffs are a limited liability company, andthere is no evidence that the plaintiffs had authorised payments ontheir behalf through Attoh Quarshie, the defendant, from the statement of account, is stiU indebted to the plaintiffs for the amountclaimed.

The defendant may recover the payments made to Attoh Quarshie.In the meantime I enter judgment for the plaintiffs against thedefendant for the sum claimed, that is NfZl 6,601.50 and interest atfive per cent. Costs NfZIl,500.00.

[1977] 1 O.L.R. Commodore v. Fruit Supply (Ghana) Ltd. 265

The defendant has not proved her counterclaim. All she said wasthat she made over-payments without substantiatiDg it Her counterclaim is dismissed. No order as to costs."

Dissatisfied with that judgment, the defendant (hereinafter called theappellant) now seeks redress from this Court of Appeal. She contendsfir^, that the judgment of the trial court was ma^estly against theweight of the evidence; secondly, that while the learned judge misheldthat Attoh Quarshie coifid not properly receive moneys due to the plaintiff-company (hereinafter referred to as the respondents) because he was nevera director of the said respondents, the learned judge furthermoie erred inhis finding that determinate evidence ought to have been adduced to showthat Attbh Quarshie had the r^pondents* express authority to receive andaccept the appellant's money payments for and on the company's behalf.

After very carefully reading and considering the whole of the judgmentappealed from, against die necessary background of all the evidence andcircumstances of this case, I am convinced to hold that the learned trialjudge never sufficiently addressed his mind to all the several vital issuesraised and inherent for determination on the pleadings and the availablegeneral oral and documentary evidence. As I conceive the situation, itwas not competent for the trial judge to have settled the vital issue ofliability and indebtedness from a bare consideration, only, of the plaintiffs'statement of accounts, without more. Nor was it a commendable exerciseof his functions for the trial judge merely to have stated that "the defendanthas not proved her counterclaim." In consonance with the properdischarge of his functions, he was bound to have gone one necessary stepfurther and shown, by adequate examination of the evidence and otherrelevant matters before him, his reasons for that conclusion, those reasonsat the same time conforming with the reqiiirements of the relevant law.As van Lare Ag.C. J. put it in Issaka v. Tailor, Court of Appeal, Cyclo-styled Judgments, July-December 1959, p. 30 unreported: "It was notfor the learned judge of the Land Court to prefer any party's version ofthe facts without assigning clear and convincing reasons."

The record of appeal clearly speaks to the fact, admitted on both sides,that in the course of the fish-supply transaction which had been carriedon ovei a considerable period of time, certain arrangements had beenestablished and followed. Amongst the foremost of these were the exclusivesuf^ly to the appellant of all the req}ondents' fish landed at the Temafishing harbour; the selling of that fish by the appellant who turned overthe proceeds of her sale to the respondents; the understanding, also,whereby Attoh Quarshie raked in 50 per cent share of the proceeds of theappdlant's fish sales. Ramia, the respondents' managing director, wasalso interested in the profits.

It is significant to note, from the evidence, that Attoh Quarshie'sbusiness with the style and name of Assatoh Ltd. came into being duringthe currency of the fish-supply transaction between the respondents andthe appellant herein. The introduction of Assatoh into the business dealingsbetween the respondents and the appellant, and the effect it had upon that

266 Ohana Law Reports [1977] 1 G.L.R.

transaction, are all matters that ought never to have escaped the inquisitiveattention, or comment, at least, of the learned trial judge because theevidence before him indicated that Attoh Quarshie's Assatoh Ltd. alsoentered upon direct flsh dealings with the appellant, and also handledsome moneys while the original flsh-supply transaction continued betweenthe respondents and the appellant. To my mind, the significance of thisbther dealing lies in the vital question whether, if any moneys were paidto the respondents at all by the appellant, she did so through AttohQuarshie's Assatoh Ltd. t And if moneys were so paid, then whether AttohQuarshie received and accepted those moneys for and on behalf of thorespondents, or whether for his own profit as Assatoh Ltd.? There wasthe further essential issue whether, having regard to the regulations ofthe respondent-company, and to the relevant and applicable provisionsof the Companies Code, 1963 (Act 179), the business dealings of AttohQtiarsme thro^^ Assatoh Ltd* were proper, If he was a director of thefespondeflts? These and other truly pertinent matters tho learned trialJNidge failed to investigate and resolve one way or the other.

^ Concerning Attoh Quarshie's part in these transactions, the learnedtrial Judge made the following findings which have formed one of thebases of this appeal:

(&) That although Attoh Quarshie was a great influence in getting therespondent-Company off the ground, he never was, at any time, adirector thereof. He was, at best, a mere frontman.

(b) That even though the appellant made her payments to AttohQuarshie in good faith, "hoping that they will reach the plaintiffs"(the respondents herein) *'y©t the said respondents had notauthorised payments on their behalf through Attoh Quarshie."

As I see it, specific and important issues had been clearly raised onthe pleadings ̂ d settled by the parties herein as being necessary for theproper determination of their respective rights and liabilities under theirbusiness transaction. It was a part of the learned judge's function,therefore, after closely scrutinising and evaluating the whole of theevidence before him, to have made specific findings of fact on those andother material issues. This not having been done, I hold that the trialjudge erred and thereby disabled himself from arriving at the properdecision on the available evidence and data before him. Faced, then, withsuch a serious lapse, this court feels adequately empowered to look againinto the whole matter anew to decide whether true justice was done inthis case.

I find from the record also, that while the reasons given by the learnedtrial judge for his decision were at once inadequate and unsatisfactory,his handling of so important a suit was much too cavalier. He neverseriously adverted his full judicial thought or attention to the documentaryand other evidence tendered, nor yet to the material parts of Act 179.Exhibits A, C and D, for example, he merely mentioned in passing withoutassesring what weight or relevance was due them, having regard to thematters in issue before him.


I come to the decision, therefore, that in these rather special circumstances, and particularly because this court is satisfied that the judgmentbelow was manifestly wrong, we would be failing in our duty'if wo didnot order that a re-investigation of the whole matter in controversybetween the parties to this suit, be properly carried out so that substantialjustice be seen to be done between them. On this aspect of the matter,I would make pertinent reference to Ashitey v, Dodoot Court of Appeal(full bench), 15 August 1969, unreported; digested in (1969) C.C. 157where Akufo-Addo C.J. delivering the judgment ol the full bench, said,inter alia:

•*A successful investigation would necessarily involve a process offact finding. One of the primary functions of a Judge hearing a case atfirst instance is fact finding. A decision by a judge requires, first, thesifting of the evidence bearing on the controversy, no matter howdifficult the exercise may be, in order to find out where the truth liesbetween the conflicting versions pleaded before him. A deliberateomission to perform this function would be an abdication of the judicialfunction, and a case cannot be said to have been properly heard wheresuch an abdication occurs. In the present case the relevant facts foundbythe ordinary bench and on which their decision was founded werejust the facts which the learned trial judge should have found. In thesecircumstances we think the trial v^as unsatisfactory, and although theordinary bench did their best in the circumstances to make up forthe trial judge's default, they were palpably hampered in their effortsby the fact that they had before them nothing more than the printedrecord of the evidence and a judgment in which the material factswere wholly absent."

(The emphasis is mine.)In my considered opinion, there'was, in the present case now before

us, a clear dereliction of judicial function. Therefore, this court cannotrightly allow the trial court's judgment to stand since the record is sopregnant with data showing that that judgment was arrived at without"a sifting of the evidence bearing on the controversy" between the partiesherein so that the true metal was separated from the dross.

From the admittedly cold, but to me, very articulate print of the recordof appeal, however, I am able to discern strong witness that the learnedtrial judge failed to take proper advantage of his having seen and heardthe witnesses, and also of watching their demeanour. In this present case,therefore, that special advantage eiuoyed by the learned judge cannot, inmy considered opinion, suflSciently explain or justify the erroneous conclusions he arrived at.

As I read and understand the relevant authorities (see e.g. Ashitey v.Dodoo (supra); Fulham Borough Council v. Santilli [1933] 2 K.B. 357 atp. 367, D.C. followed in Stepney Borough Council v. Joffe [1949] 1 K.B.599 at p. 603, D.C.; Reynard v. Allan (1934) 2 W.A.C.A. 52 at pv 53 andAmponay v. Teyi (1937) 3 W.A.C.A. 182, the true position is that the


Court of Appeal will not make a fetish of the fact merely that the trialwurt has seen and heard the witnesses if, in so doing, the proper ends ofjustice will be defeated. On the contrary, the Court of Appeal will beswift to interfere to do substantial justice between the parties where, forexample, the trial judge, notwithstanding his advantage of seeing andhearing the parties and their witnesses, has either failed to take all theavailable oral and documentary evidence into necessary consideration;or where the questions for decision are not ones of pure fact; or wherethe only question for determination is not whether the trial judge arrivedat the correct or right conclusion on the facts of the case; or where theinferen(»s he has drawn cannot be supported, having proper rqgard tothe available evidence: see, e.g. Oppong Kofi v. Fofie [1964] G.L.R. 174S.C. and Barclays Bank D.C.O. v. Heward-Mills [1964] G.L.R. 332, S.c!

Turning now to the facts of this instant case, I find that when thedilutes arose as to payment of moneys which sparked off this action,the appellant had been doing business with the respondents for a considerable length of time. It must be reasonably presumed, therefore, thatshe knew the respective positions of both Messrs. Edward Ramia andAttoh Quarshie vis-k-vis the respondent-company. On their own adinissionthe appellant knew that Attoh Quarshie had some share of the profits inthe re^ndents' business with her. Ramia himself, the respondents' ownmanaging director, clearly confessed to the fact that the respondents hadput forward and represented Attoh Quarshie to the whole world as theirdirector. Attoh Quarshie testified that he was not only a director of there^ndents' but a "partner" also. On this vital aspect of the matter theevidence of John Hermann Van Boven, the plaintiff's third witness andmanager of the Ghana Cold Stores Ltd., Tema, is pertinent and I quotehim ad longum to show that he confirmed the position and active influenceof Attoh Quarshie as an operative director of the respondents, but givingthe lie to Edward Ramia's denial that Attoh Quarshie was a director Hesaid: '

"Attoh Quarshie was once our customer with the defendant. I knowon the letter-heads of Fruit Supply Attoh Quarshie is a director. I havea letter from Fruit Supply showing Attoh Quarshie as a directorAttoh Quarshie was signing for Fruit Supply. He has an authority tothis ejfect:'

(The emphasis is mine.)When he was cross-examined, this witness completely discredited the

learned judge's finding that Attoh Quarshie was a mere front man for therespondents, but never their director, or agent, with the following answer:

"In Febru^ and March 1969, I refused to deliver fish to theddendant if I did not receive a letter from Ramia or Attoh Quarshieand Ramia gave contradictory instructions as to the release of fishto the defendant"

Thus de^ her supply of fish, the appellant must have sought anexplmiation from the respondents whose managing director, Ramia, must

[1977] 1 GX.R. Commodore v. Fruit Supply (Ghana) Ltd. 269

then have accompanied her back to the Ghana Cold Stores Ltd., for thewitness continued thus:

*'When Ramia came I insisted on receiving a tetter from them withtheir signatures. When I received exhibit L, I knew Attoh Quarshie andRamia were both directors .. . On the strength of exhibit D2 I issuedto the defendant 2,985 cartons of Ramia fish... Attoh Quarshie dealtwith us for the plaintiff. Attoh Quarshie has been representing Ramiaat the fish harbour."

(The emphasis is mine.)On this aspect of the matter the learned trial judge ought to have

considered and evaluated exhibits Dl, D3 and L, letters written on therespondents' letter-heads. He would have found, as a matter of positiveand telling significance, that all these letters loudly proclaimed AttohQuarshie as one of the directors of the respondent-company. The respondents' managing director, Edward Ramia, had himself admitted undercross-examination, that they "did print papers on which he, Attoh Quar-shie's name appears as director." While exhibit L (dated 27 Febjruajfy1969) authorised the Ghana Cold Stores Ltd., Tema, to deliver to theappellant a specified quantity of "sardine fish bought of Fruit SupplyGhana Ltd., Accra," exhibit DI (dated 4 March 1969, also addressed tothe Ghana Cold Stores Ltd.) informed that establishment of misunderstandings and forbade them to supply any fish to the appellant until ahofficial letter was issed by the respondents' managing director. Exhibit D3was earlier in time. Written on 16 February 1968, exhibit D3 instructedthe manager of the Ghana Cold Stores Ltd., Tema, in the following clearterms:

**Please note, our director, Mr, Attoh Quarshie, is hereby fullyauthorised to store fish for this company, and to withdraw, tramfer or dowhatever he considers appropriate to do during the absence of themanaging director of this company**

(The emphasis is mine.) This letter was signed by Edward Ramia, themanaging director. I construe these letter-heads and the contents of theseand other letters and documents in evidence not only as a stiict adherenceand compliance by the respondents to, and with, section 198 (1) of theCompanies Code, 1963 (Act 179), but also as a dear notification to anyonewho did business with the respondents of the fact that Attoh Quarshie wasone of their officers fully clothed with the powers of a director to act forand on the respondents' behalf. I hold, therefore, that to all intents, andfor all the purposes of the transaction between the parties to this action,the respondents must be regarded as having meant to hold out, and infact so holding out and representing Attoh Quarshie to the appellant andthe whole world as a director-member of Fruit Supply (Ghana) Ltd.,working for and on that company's behalf. To that extent, 1 hold therespondents completely estopped from now denying their representationof Attoh Quarshie as their officer and director.

270 Ghana Uw Reports [1977J I G.L.R.

It is significant to observe that Attoh Quarshie himself denied, in hisevidence, that he was "a mere front man," but insisted that he was a director of the respondents and a partner. He said, inter alia: "I was a directorof the company. As a director I wrote letters to the Ministry of Trade for thecompany to he registered as importers ... As a result the company wasregistered." (The emphasis is mine.) This is amply confirmed by theevidence of Albert Kwesi Appiah, the defendants third witness, a civilservant at the Ministry of Trade, Accra. After showing that Attoh Quarshiesigned those early applications as the company's managing director, for theregistration of the respondents, he took the matter further, beyond thoseinitial prc-registration acts in January 1968. His evidence leaves no doubtat all in my mind that subsequent to those early pre-registration days,Attoh Quarshie still had the respondents' authority to act for and on theirbehalf, with the Ministry of Trade and with the whole world, as theirdirector. Several exhibits admitted without objection from or by therespondents (e.g. K, L, M, and N), range over the period January 1968 toFebruary 1968 and bind the respondents to adverse and conclusivesilence on the material issue of Attoh Quarshie's membership of therespondents as their director, and liis authority so to act. I would hold,therefore, that by his acts and statements, Attoh Quarshie went beyondmerely promoting and registering the respondent-company. I am satisfiedand hold, furthermore, that he symbolised himself, and that the respondents also acquiesced in that representation of Attoh Quarshie's, as theirofficial having proper authority to further the objectives of the respondentsin all their transactions, including the fish-supply business with the appellant. On the issue, therefore, whether Attoh Quarshie was, or was not, adirector, servant or official of the respondents, I am persuaded by thepreponderance of the available evidence and the statute, to hold that thelearned trial judge was not entitled, on the clear facts before him, and thelaw, to take the view that Attoh Quarshie was not a director. 1 find as afact that, without extending his researches into the lelevant provisions ofthe Companies Code, 1963 (Act 179), and investigating the true meaningof the material exhibits available to him, the learned trial judgepermitted himself to be misled by the following evidence given, inter alia,by the respondents chairman and managing director, Edward'Ramia;

"I know Attoh Quarshie. He is not a member of my company.We were to make him a director of the company. We did print paperson which he appeared as director. But he waj never confirmed asdirector because he failed to contribute the necessary shares to makehim director. He is not the managing director of the company.'"

(The emphasis is mine.)^ Standing alone, this piece of evidence appears strongly to support the

trial judge s fmding that Attoh Quarshie was never a director of therespondents. But when appropriate regard is had to the totality of AttohQuarshie's own admission; when careful consideration is given to thecontnbutions of Messrs. Van Boven the plaintiff's third witness and

[1977] 1 O.L.R. Coiiimoclorc r. Fruit Supply (Glinna) Ltd, 271

Albert Appiuh (the defendant's first witness), and these are coupledmeaningfully, also, with an indispensable consideration of the relevantprovisions of the Companies Code, 1963 (Act 179), ond of such exhibits asKl, LI, Dl, 2, D3, and 4, the managing director's testimony standswholly denuded of probative value, weight and effectiveness and it fails,therefore, both to avail the respondents and to support the judgment.A close reading together of the evidence on record with section 179 of theCompanies Code, 1963, fortifies my view that a proper interpretation ofthe evidence on record and the regulations of the respondents must leadto the decisive conclusion that Attoh Quarshie was a director. The sectionprovides as follows:

"179. (1) For the purposes ofthis Code the expression'directors'means those persons, by whatever name called, who are appointed todirect and administer the business of the company.

(2) Any person, not being a duly appointed director of acompany, „ ..

(а) who shall hold himself out or knowingly allow himself to be held out as a director of that company, or

(б) on whose directions or instructions the dulyappointed directors are accustomed to act,

shall bo subject to the same duties and liabilities as if he were a dulyappointed director of the company:

Provided that nothing in this subsection contained shall be deemedto. derogate from the duties or liabilities of the duly appointeddirectors, including the duty not to act on the directions or instructions of any other person.

(3) If any person, not being a duly appointed director ot acompany, shall hold himself out, or knowingly allow himself to beheld out, as a director of the company, or if the company shall holdout such person, or knowingly allow such person to hold himself out,as a director of the company, such person or the company, as thecase may be, shall be liable to a fine not exceeding one hundredpounds. .

(4) For the purposes of subsections (2) and (3) of thissection a person who is described as director of a company, whethersuch description is qualified by the word 'local', 'special', 'executive ,or in any other way, shall be deemed to bo held out as a director ofthat company."

As I interpret the Code and the facts of this case, together, if AttohQuarshie was not named in the respondents' regulations to qualify as afirst director in. accordance with section 181 (2) of Act 179, the subsequentconduct of the respondents, and the events and circumstances of thetransaction herein, nevertheless openly combined and conspired to professhim as a director within the meaning of section 179 of Act 179.

Taking due and necessary cognisance of all this, then, I hold that on thefacts of the present case both the respondents themselves, and Attoh


Quarshie, stand firmly caught by the Act, because as 1 understand thefacts, It IS irrelevant whether Attoh Quarshie held a requisite number ofshares in the company at any one time; or whether the respondents eversimsîKntly confirmed him as their director. By their acts they had bothoffended against the statute and they were Uable to suffer the prescribedpe^lties. That, to my mind, is what really mattered, in the circumstancesof their mtercourse.

ThQ question, therefore, is whether, upon the totaUty of all these clearadmissions and havmg regard to the regulations of the respondents andê Oim^nies Code, 1963 (Act 179), and then to the transaction as a

respondents and the appeUant, the appellant wasentitled toûme or justified m beheving, that Attoh Quarshie had therespondent authonty to accept and receive payment from the proceeds ofher tansacUon with the respondents. And whether she had good reason

I ̂ moneys to Attoh Quarshie would gorather to As^toh Ltd. and not to the respondents. In view of the over-of proceedings, I dismiss, asmefertual, the respondents demal that they ever authorised Attoh

dS? managingdirector of the respondents, when he testified, merely to have said that he^d never authoripd Attoh Quarshie "to ̂ Uect V monerforê/'sSire oi and personalor money. It was imperative, I hold, that the managing director

onlvthat adducing satisfactory evidence notonly that Attoh Quarshie had no ostensible or other authoritv from themeither as the respondents* officer or agent, to coUect, or to receive anySrt°aUn r5i° fish-supply transaction with the appeUant;but also, and equaUy important, that the respondents had never bv anysul«ûent conduct on their part, either ratiBed or acqufes^d in anydealing by Attoh Quarshie with the appellant herein. In my opinion the

fM roi i J "® provisions of section 140 (1)*'^Compames Code, 1963 (Act 179). These relate to theacts of officers and agents of companies. '

There was cogent evidence showing that at all times material to thetiaimction herem, Attoh Quarshie had been, and he was, and he alsocontinued to an active director of the respondents. There was, however,no evidence forthcoimg from the respondents to indicate that AttohQuarsffie had at any time ceased being an officer or director of the respon-

®1?^ proceedings before thisMurt, therefor®, that the respondents at any particular or other time,T Attoh Quarshie by any express indica-tions to the appellant in particular, or to the outer world in general. Neither

theres^n^ts nor Attoh Quarshie, ever denied that their letters in exhibit,and other documents connecting them to the fish-supply transaction withthe appellant, bore the true and genuine signature of Attoh Quarshie. I dohold, consequently, that, in all the peculiar circumstances of this case, it


was the respondents who signed all those documents through AttohQuarshie, their agent, officer and director. From the undisputed facts of hissignature, and from the printed presence of his name upon the face of therespondents* headed note-papers, I am satisfied to hold, furthermore, thatall those facts fully authenticated the respondents' dealings with both theappellant and third parties through their man Attoh Quarshie.

It is worthwhile, in a case such as this present one, to be mindful of thecommon law rule intimated in the maxim, Quifacit per ahum facit per sewhich, being literally interpreted, means that a person who acts, or doesanything, by or through another does that thing by himself. In this case,therefore, all the practical indications must point irresistably to the conclusion tlmt at all times material to the transaction herein, the respondentsconsented to Attoh Quarshie acting for and on their behalf. If the learnedtrial judge had but paused for necessary judicial thought, with adequateattention to the relevant portions of the Companies Code, 1963 (Act 179),adverted to in this judgment, he would have come to the proper findingthat Attoh Quarshie was the respondents' alter ego, and not the erroneousdecision that. Attoh Quarshie was never a director of but "a mere frontman" for the respondents. According to section 198 (1) of the Code:

"198. (1) Every company shall in all trade circulars and businessletters on or in which the company's name appears state in legiblecharacters with respect to every director, including substitute directors... but excluding alternate directors ...

(a) his present forenames and surname,(b) any former forenames or surname."

This is a mandatory provision, subsection (2) whereof carries a penaltyfor default. And the respondents, having complied therewith, they cannotnow be heard to say (completely estopped as they are), that they nevermeant or intended that Attoh Quarshie shall be taken or regarded as thendirector or officer. It must also be observed that although machinery isprovided imder and by virtue of section 197 (3), of the statute for thefication of change of directors, there is no data anywhere in the record forthe probable inference, even, that because Attoh Quarshie had eitherceased to act or been removed, he must accordingly not be considered as anofficer of the respondents having any power of authority, as a director, totransact any business for or on the respondents' behalf. In this connectionI do adversely translate exhibit F (dated 4 and 25 April 1968) against therespondents as showing that although they knew what to do, and had infact done so accordingly, concerning two of their other directors (i.e.Victoria Adobea, and John F. Cobbina), they had no intention whatsoeverof repudiating Attoh Quarshie by removing him from their books. It is myopinion, therefore, taking heed of the strict requirements of the CompaniesCode, 1963 (Act 179), that all these matters ought to have been consideredby the learned trial judge who ought, ther, to have^t all the facts andstatutory data into their true and proper persj^ctive and resolved them asclear facts intended by the respondents to confer indubitable authority ontheir director and representative, Attoh Quarshie. A fortiori, I hold that the

G.L.R. 19T7 (Vol. X)


respondents' failure or negligence to set in train that easy machinery aforementioned, for notifying change, precludes them absolutely, from denyingthe existence of that state of facts which, with their own tacit acquiesecenceand connivance, had all along clearly depicted Attoh Quarshie as havingauthority to act on their behalf, t make pertinent reference to Re CountyLife Assurance Co, (1870) 22 L.T. 537, where the acts of usurper directorswere held to be binding because no steps had been taken by the company tohave them ousted. •

In the nature of their rather loose transaction there was a further factwhich strengthened the cause of the appellant, namely, that since she had

• nothing to the contrary to put her on her due guard, she wasjusUfiably entitled to assume that Attoh Quarshie was not only dulyappointed by the respondents as their agent, director and servant, but alsothat he was invested with proper authority to exercise the powers and functions ordinarily exercised or performed by a director of the company. This18 a statutory presumption which is rooted in sections 140 (1) (6), and 142(a) and (b) of Act 179.1 would also direct attention to regulation 73 (1) ofthe re^ondents' regulations which provides that a person appointed as themanaging director shall have that office automatically revoked by thecompany if he ceases, "from any cause," to be a director. Attoh Quarshienever ceased to be the respondents* director.

therefore, when8^ paid the moneys to Attoh Quarshie. It was enough support for her that8^e dealt with Attoh Quarshie and the respondents in good faith, genuinely^^mg (as found by the learned trial judge) that what she had bona fidepaid to the respondents* director and officer would reach its properly intended destination, namely, the chests of the Fruit Supply (Ghan^ Ltd. Itwas never shown by the respondents, at the trial, that either before orduring their transaction with the appellant, she had means (but had failedto use them) of discovering that as a director Attoh Quarshie had not the

authority to act for them or to receive moneys for and on theiroehaif. In the circumstances of this case, with especial regard to the representations of the respondents concerning Attoh Quarshie, I doubt verymuch whether such proof, if at all forthcoming, would have availed ther^pondents to break and demolish the estoppel standing so solidly againstmem. It is my opinion, having regard to the peculiar nature of the mannerof the respondents* business deaUng with the appellant, that there was noonus whatsoever upon her to adduce any evidence to show either from theregulations of the respondents, or to prove, any express authority in AttohQuMshie to do such things as a director and officer is properly empoweredto do—in her particular case, to do business with him and in the course ofthat business to make bona fide money payments through him to the respondents. To my mind, it was enough that throughout her long tradingassoaauon with the respondents, the appellant had been induced to acceptAttoh Quarshie as a person fully entrusted with the conduct of some part ofthe respondents' business. On this very vital aspect of the whole matterI direct attention to Royai British Bank v. Turquand (1856) 6 El. & Bl. 327,


witich is competent authority and conclusive support for the success of theappellant's posture both at the trial and in this appeal. That case enunciatesthe proposition that persons who enter into a contract with a company anddeal in good faith with that company, have the right to assume that actswithin the constitution and powers of that company have been duly andproperly performed. Such persons are under no duty to go behind thescenes, as it were, to inquire whether acts of internal management havebeen regularly performed, or carried out. The appellant's case standswholly fortified by this decision which is still good law. ,

Considering the fish-supply transaction as a whole, and the facts anathe law herein, I come to the decision that since that business fell squêiywithin the ordinary scope of the respondents' dealings; and bûse thosetransactions were never ultra vires the respondents' regulatio^^^learned trial judge erred when he burdened the appellant, on the avauapiefacts and statutory data, with proof of express authority by. ̂ "om, therespondents concerning her money payments to Attoh On thefacts, therefore, and more particularly in law, I hold that at all têsmaterial to their transaction, the appellant was entitled to relyseveral matters hereinbefore adverted to as conferring apparent authontôn Attoh Quarshie to act for and on behalf of the company wl^ch thereforestood bound by those acts done without their disclaimer. 1 would hereadopt the statement made by Giffard L.J. in Re County Life Assurance(supra). He said at pp. 538-539:

"the company is bound by what takes place in the iwual c^rse ofbusiness with a third party,... provided that... the third pa^ dwfairly and bona fide . with persons who may be termeddirectors . . . that is to say, persons who might very possibly havbeen de jure directors."

It is my view, therefore, having regard to all the facts and theauthorities, that that decisive fact of bona fide money-payments by theappeUant to the respondents through theip man and offidal, AltonQuarshie, cannot properly be vitiated because the appeUant failed todemand to be shown, by Attoh Quarshie, any written or siêd authoWfrom or by the respondents for those payments. It is my fbrther opim^that if the presentation of signed authorities was part of themeirt as to how their transaction was to be carried out, than the burden t ywith the respondents to establish that practice by clear and aa^wevidence. Of this, however, there was no proof, direct or inferential, iuotis evidence, rather, that the respondents never gave r8<»»P's to,the api»uanfor the payments she made. Wherefore I am persuaded to hold ttot in herpecuUar situation, the appellant was fully entitled to braeflt 'tory presumptions of regularity so clearly purposed under and y142 Qj) of the Companies Code, 1963. It was no concern of the appeUam,therefore, first to have been satisfied whether the internal affmrs of nrespondents had been so regularised as to entitle their ostensible servantand director to receive her bona fide payments, particularly as, in aU tne

276 Ghana Law Reports [1977] I G L.R.

circumstances of their transaction, the impression had been left that AttohQuarshie and Edward Ramia were entrusted with the management andcontrol of the respondents' business. In Barrett v. Deere (1828) M. & hf.200, it was held that payment to a person found in a merchant's counting-house, and appearing to be entrusted with the conduct of the businessthere, was good payment to the merchant, though it turned out that thatperson was never employed by the merchant. It is an established legalprecept that all tlungs are presumed legitimately done, until the contrarybe proved. And since that contrary proof was never adduced by the respondents, I am constrained to hold the respondents inextricably caught bythe provisions of section 179 of the Companies Code. 1963.

Having regard to the facts and circumstances of this instant caseI read and interpret regulations 68 (1), 68 (2), 70, 71 and 73 (1), of therespondents' regulations, together also with the material provisions of theCompames Code, 1963 (Act 179), more particularly section 179, to meanthat whatever Attoh Quarshie did in connection with the fish-supply^nsaction herein he must clearly be understood to have done witliinthe fuU intendment, and the permissible scope, of his manifest authorityas the respondents' officer and director. The respondents had at allmaterial times, held out, suffered, and permitted the said Attoh Ouarshieto occupy the position of, and to act as, their director and agent, thereby

P^^c^larly, to the full acceptance and bona fidetehef that he had the unquahfied authority of the respondents to furthertheir interests and objectives in their transaction with her; and, furthermore, to accept and receive moneys accruing therefrom. But if. as therespondents contend, Attoh Quarshie had no such visible authority(as he so very clearly appears, on the evidence, to have had) then theburden of estabhshmg that absence of authority rested squarely with themthe said respondents, and not with the appellant. Let me here directr^evant attention to Affl[/o/ag^>ev.£flr6i.[1959] G.L.R. 190 at p 192 and

respondents ought to have proved that want of authorityevident of facts and circumstances, from which*

Ithis] Court can be satisfied that what [they aver] is true."The respondents having thus led the appellant and the whole world

ho^y to beUeve and to accept Attoh Quarshie as their director, I holdthat the learned trial judge seriously erred in failing to find, as a decisive1^, ttot all the personal acts of Attoh Quarshie touching and concerninethe^-supply transaction, were those of the respondents themselvesbmdmg on them; and that there was cogent data provided for the necessaryirfete^ also, that those acts done for and on the respondents' behalf(i^udmg the receipt of money payments made by the appellant in goodlaith) were consented to by the respondents.

To give proper meaning and sufficiently cogent efibct to the transactionbrtween the parties henan, therefore; and in order not to make nonsenseof the provisions of the Companies Code, 1963 (Act 179), which arerelevaat and applicable to the facts and circumstances of this case, itIS only just, I think, that the respondents be held bound to the appellant

[1977] 1 G.L.R. Coiumodore v. Fruit Supply (Ghana) Ltd. 277

by the acts » id conduct, both express and unpUed, of both Attoh Quarshie,and of the respondents themselves. I amôved to this decision becauseI find that, upon a true interpretation of the regulations of the respondents,taken together with their fish-supply transaction with the appellant, andthe material provisions of Act 179, it is reasonably permissible to inferand conclude that it was never within the contemplation of the parties tothat transaction, that Attoh Quarshie's connection therewith, and hisactive involvement therein, should be that of a mere outsi^r passivelylooking on; but rather that his involvement and partici^tion was thatof a person meant to be effectual and clothed, therefore, with full authorityand power to do such acts and things as were not only kno^ to therespondents, but which were also expedient and incidental to their regulations and to their business. j j ̂

1 see from the record of proceedings that the respond^ts adduced noevidence to show that the appellant dealt with the respondents iôn thefooting or understanding, that Attoh Quarshie would act delusively onhis own private, and not upon the respondents* public interest and behalfon the issue of the collection of moneys due or accruing to the respondentsfrom the fish-supply transaction. The true nature of the agreement betweenthe parties herein being that the appellant yr&s to pay moneys to therespondents for the daily value of all fish supplied her by them, it becamethe duty of the respondents, if they did not wish any payments from theenterprise to be made to any person or persons, but direct to the company,to have warned the appellant to deal strictly and solely with the companyupon the mutual and ad idem understanding that Attoh Quarshie wasa separate and distinct person who had nothing whatsoever to do withtheir business. From her long and intimate business association with merespondents, however, she had been led to regard Messrs. Attoh Quwshieand Edward Ramia as the professedly living parts and human agencies otthe respondents* enterprise. Not once had the respondents ever given hercause to doubt or to suspect the validity of anything tot Attoh Quarshiehad said or done, in relation to the fish-supply transaction. Since, thwefore,upon the face of the record there is cogent data for the necessary inferencethat the respondents hadj at all material times, held out representedAttoh Quarshie as their official, agent and director, authorised to promotethe objectives and interests of the company; and since, further, therespondents failed to show that they had ever expressly forbidden theappellant to make any money payments to Attoh Quarshie; or else tohave any truck with him at all, I would hold, on the necessary probabihtiesof this case, that all moneys paid to Attoh Quarshie by the appellant werereceived for and on the respondents* behalf, irreêctive of the factthere was in existence Attoh Quarshie*s own business, Assatoh Lt .I would further hold that the appellant accordingly eswpes blame if,as so clearly appears from the evidence, Attoh Quarshie, in brazen-faceviolation of his first duty to the respondents as director and trustee, acteddishonestly and kept those moneys (meant and intended by her, for therespondents) for his own profit.

Ghana Law Reports [19771 1 G.L.R.

.1, fi'J conceive it. receiving or collecting moneys which accrued fromX "■"■J^'ction was a perfectly legitimate act done in referenceto the respondents particular business with the appellant. It is sisnificantto point out, also, that while Attoh Quarshie himself madi'ly fd "

received those moneys from the appellant, he neveradduced any facts to show that he had kept separate accents of moneysthat accrued to his Assatoh Ltd. It is my opinion, consequently, that in thepecuhar circumstances of this intercourse, absence of such evidence ofinêood ST* T"® presumption that the moneys paidin good faith to, and received by Attoh Quarshie, were not honestivAu7% respondents' purposT althoSAttoh Quarshie alleged that the money was personally his and not themspondents-. The appellant well knew she 4s deauVwith 1 liftedoTMesTrTS^* ̂ Tiiey had openly represented and heldout Messrs. Edward Raima and Attoh Quarshie, as fuUy authorisedirectors, officers and members of the company. It cannot be said there

S^Sra°rvtef of cornciS p4of Xcontrary) that her money payments to the respondents in connection withtrial' r ^'"properly made. I would agree with the learnedtrial judge, therefore, when he declared, inter alia in his iudamenf

She was aware that the plaintiffs were a limited liability comnanv and

amenaS'" mnd. the learned judge's further holding 4m {heappellant may recover the payments made to Attoh Ouarshie" ia nianradmission that while the money was in fact oaid thncA^ s clearto have gone into Attoh Q^rsWe's p&poc^^ênjoyment of either his AssMoh Ltd. o^r of hiêlf

True, Attoh Quarshie was entitled, under the nartiVe* *

!LJf ? TT """ttat as director, Attoh Quarshie must be taken to have had secured to himentitled him. However that may be, it is my opinion flrstlv if ♦!.«oTw^m *1®'' it® 71^ in strict duty bound by reasonWs^^"T7het'*°^®'^ thei^pondents, neverl mi^4 Sv«A proceeds was with what was legitiraatelv due tn therespondents; and secondly, that he had no private ropriMor^ rilht ?^

£ r r I'—!"

ed to share profits; but any payments or moneys flowing

[1977] 1 G.L.R. Commodore V. Fruit Supply (Ghana) Ltd. 279

from that fish would necessarily first belong (in the absence of any contrarypremises) to the respondents, and be vested in the company for theirpurposes and benefit. To my mind, as modelled by the facts and peculiarcircumstances of this case, this was a situation which called upon therespondents for a clear distinction as to what strictly belonged to them, as acompany, and what also belonged to Edward Ramia and to Attoh Quar-shie or both, as private individuals. There was no evidence forthcomingfrom the respondents as to this.

As 1 read and understand the evidence, it was irrelevant, therefore,that Attoh Quarshie had a business known as Assatoh Ltd. It is my opinionthat his first duty was to the respondents, whose officer and director hewas, and had been shown to be. In his dealings with, and on -behalf ofthe respondents, therefore, he was expected strictly to conform to thecode of discipline specified under section 203 (1) and (2) of the CompaniesCode, 1963 (Act 179), and to show good faith, care, and diligence in anytransaction concerning the respondents, always acting in their best interests. If Attoh Quarshie, in violation of his duties, wrongfhlly divertedinto his own pockets and those of his Assatoh Ltd., moneys that hadgenuinely been paid to him for the respondents, I see no just or equitablereason why that misdemeanour should adversely affect and disadvantagethe pivotal contention of the appellant that she had settled her out-standings with the respondents. I would, therefore, uphold the appellant'scontention and, declaring that some payment has been truly made, alsoconfirm that payment to Attoh Quarshie as good payment to the respondents, valid in all the circumstances of this transaction and binding,therefore, upon the respondents.

I am of the further opinion that because Attoh Quarshie was therespondents* alter ego in all the circumstances of their dealings with theappellant, he could not, while validly doing business for and on therespondents* behalf and thereby professedly advancing their objectives,at the very same time rightfully be heard to say that he also had businessengagements with the appellant for and on behalf of his Assatoh Ltd.It is such possible conflict between an of&ciaVs duty to his company andhis personal interests that Act 179 seeks to avoid: see section 205. By itsvery spirit and intendment, the Companies Code, 1963, clearly frownsheavily upon double-dealing and want of honesty and good faith inmembers and officers of companies. Any acts that prejudice the interestsof a company cannot, therefore, be sustained in circumstances where theprovisions of the Code are relevant and applicable. .Wherefore, 1 amimpelled to the view that even if the appellant had made her paymentsto Attoh Quarshie*s Assatoh Ltd., yet because she was shown to havehad direct business dealings with the respondents, through their officialAttoh Quarshie, her payments properly belonged neither to Quarshiepersonally, nor yet to his business Assatoh Ltd., but rather to therespondents. I call in aid the statutory presumptions under section 142(A)of the Code to free the appellant from the harsh effect of the trial court'sdecision.


Apropos of this, 1 would also adopt for and apply to, the purposesof this instant case, the statement of Romilly M.R. in Great LuxembourgRail. Co. V. Magnay (No. 2) (1858) 25 Beav. 586. It was held, in that case,

. that the directors of a company are trustees, and they have attached tothem, for the benefit of the shareholders, all the liability and duties whichattach to a trustee and agent. If, therefore, a director enters into a contractfor the company, he can derive no personal benefit from it. In the course

. of his judgment Romilly M.R. declared at p. 591 as follows:"1 have, upon various occasions, stated what I consider to be

the duties and functions of a director of a joint stock company.He is, in point of fact, not merely a director, but he also fills thecharacter of a trustee for the shareholders, and he is, in regard to allmatters entered into on their behalf, to be treated as an agent; there-fdfe there attach to a director, for the benefit of the shareholders,all the liabilities and duties which attach to a trustee and agent.Accordingly, if a director enters into a contract for the company,he cannot personally derive any benefit from it.**

(The emphasis is mine.)See also Cudjpe v. Conte Ltd. [1964] G.L.R. 28, S.C. which held inter

alia, as stated in the headnote that:

"(1) directors of a company are in a fiduciary position and all thepowers entrusted to them are onl> exercisable in that fiduciary

y capacity. Further, where the directors make any profit as the resultof their fiduciary position, they have to account to the company forit."

One of the relevant matters that the trial court was called upon tolook at (but which it sadly neglected to do) was the state of the businessaccounts between the respondents and the appellant. From a carefulperusal of the record, I find that if the learned trial judge had approachedthe issues before him with the seriousness and incisive care that the stateof the pleadings and the general evidence, so urgently demanded, hewoidd not have failed to discern that as an aid to proper justice, anofficial or special referee's investigation (under and by virtue of Order33, rr. 1,2, 3,10 and 11 of the High Court (Civil Procedure) Rides, 1954(L.N. 140A), would have assisted the court in settling the issue of whoowed what to whom, and the extent or magnitude of that indebtedness.But he never did. 1 hold, therefore, that the trial judge's failure to considerthat statutory expendiency deprived the parties, more especially theappellant (who by her pleadings, counterclaim and evidence hadstoutly rebutted the respondents' prima facie allegations of liability)of fair and balanced justice. Although Order 33 of L.N. 140A (supra),invests a court or judge with a discretion to order or no.t to order, aninquiry into accounts, it is my opinion that in the peculiar circumstancesof the matter before the trial court, there was adequate and compelling

rl977] 1 G.L.R. Commodore v. Fruit Supply (Ghana) Ltd. 281

justification for the peremptory exercise of that discretion. I would therefore interpret the word "may" occurring in Order 33 as a discretionaryimperative binding on the trial judge. , •

In the result, I am of the view that it would not be proper justice touphold the decision of the learned trial judge and, driving the appellantfrom this judgment seat, grant unto the respondents the reliefs Uiey soughtupon their writ and statement of daim. It is for these reasons, then, j^batI would set aside the judgment of the High Court dated 25 Februaryafid do support the allowance of this appeal and the renrittan^ of thewhole case to the High Court, Accw, for a fresh hearing on the issuesas settled at the summons for directions' stage of the abortive tnal.

Appeal allowed.Case remitted to High Court to be

tried de novo.

S.Y.B.-B.

YAKUBU V. DOVE and Another

COURT OF APiPBAL, ACCRA

17 May 1976

AMISSAH, SOWAH AND KINGSLBy-NYlNAH JJ.A.

Road traffiC'-'SigtudS'-Httnd sigtixd-Signah reseti^-^Truck driver about to turn fiom malor to minor road sigmllutg mtorcyclist on minor road to proceed into mdlor road^Motorsignal and colliding with car proceeding from Itlft side of truck-^'Dt^ pf(ôf motor cyclist'-'Vdimy of hand sigruds by personspth^dmnpoliôffiZ 7rdform-^Road Trdjfic Regulations, 1970 (IJ. 675), reg. 43 (1) and

RoaduM^Negligence-âllision--Truck driver about to turnon to minor road—Enough spaceleftonleftside of truck for other v^d^ topass on—Motor cyclist on minor road biding time to Cut across onto rmorroad—Truck driver signalling motor cydist to proceed onto fMotor cydist acting on signal and colliding with car passing on left stae jtruck—Whether motor cyclist negligent.

When Ghana was still driving on the left, the driver of a "royota truck dciviâlong the Bantama-Kejetia road in Kumasi stopped at aKumasi Zoo with the hope of turning right on the minor road. He left ®tiou^space on his left side for other vehicles to pass on. Meanwhile the appellant, wwas riding a motor bicycle on the minor road and biding his time to turn outonto the major road to join the lefthand traffic received a hand si^l from thedriver of the Toyota truck to proceed. The appellant without making sure that

estopped from emertng into contr^t on ^ehaif of company

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