The Attorney-General (A-G) has saved the state from paying over 1.2 billion in judgment debt to the NDK Financial Services, by legal action.
The NDK Financial services, went to the apex court to compel the government of Ghana to pay an amount of GH¢1.273 billion as outstanding balance and interest on a judgment debt.
However, the court awarded the Company, the sum of GH¢14,699.74 with interest after the Attorney General had challenged the validity of the Company’s claim.
As a result of the disagreement over the quantum of the judgment debt, the Supreme Court-appointed in last year, PricewaterhouseCoopers (PwC), an accounting firm, to audit the books and ascertain the veracity of the amount being claimed by the NDK Financial Services.
This followed an application by the A-G, Mr. Godfred Yeboah Dame, to the effect that the state had fully fulfilled all financial obligations to the company. Thus, the state did not owe NDK Financial Services.
In a unanimous decision by a five-member panel of the Supreme Court, presided over by Chief Justice Kwasi Anin Yeboah, the application for GH¢1.273 billion by the NDK Financial Services was thrown out.
Other members of the panel were Justices Jones Dotse, Paul Baffoe Bonnie, Sule Gbadegbe, and Nene Amegatcher.
“The decision of the court is unanimous; the plaintiff herein (NDK) is adjudged to recover from the defendant (A-G) an amount of GH¢14,699.74 as the outstanding balance by the defendant to the plaintiff,” the Chief Justice said.
“The said amount adjudged to be paid by the defendant is to attract the statutory rate of interest under Rule 4(1) of Court (Award of Interest and Post-Judgment Interest Rules, 2005; that is, C.I. 52), from 28th November 2014 to the date of final payment, with the rate being the rate as of 2nd June, 20121,” the Chief Justice ruled.
The said judgment debt was about a credit facility provided by NDK between 2005 and 2008 for Ahaman Enterprises Limited for the latter to haul some electrical poles and other electric materials on behalf of the Ministry of Energy.
NDK Financial Services was approached in 2005 by Ahaman Enterprises, a haulage company, for a credit facility and thereafter for several credit facilities over some time between 2005 and 2008 to enable the latter to execute contracts awarded it by the Ministry of Energy to haul electric poles and other electric materials from designated locations to various parts of the country under the National Electrification Project.
The NDK Financial Services requested Ahaman Enterprises to secure a written undertaking from the Ministry of Energy that payment would be made in the joint names of NDK and Ahaman Enterprises, as a condition for the approval of the credit facilities.
The said undertakings were duly signed by the Chief Director and the Principal Accountant of the Ministry of Energy between 2005 and 2008.
Based on the undertakings, NDK advanced various sums of money to Ahaman Enterprises.
NDK later argued that Ahaman Enterprises and the Ministry of Energy failed to honor the undertakings.
The NDK Financial Services issued a writ on December 21, 2009, against Ahaman Enterprises, the A-G, Messrs Alex Aduko, and Aduko Kyeremanteng, who had secured the amount.
The plaintiff, NDK Financial Service claimed jointly and severally against the defendants the sum of GH¢286,250.52, being part of the debt balance due under the facilities granted to Ahaman Enterprises by NDK between August 26, 2005, and April 28, 2006.
The High Court entered judgment in favor of NDK on December 21, 2011, but upheld an argument by the A-G that the State had fully discharged its obligation to NDK following a settlement process in which the government paid GH¢79.5 million to NDK.
NDK Financial Services went to the Court of Appeal, and on March 28, 2013, the court upheld the appeal and ordered the payment of all the sums under the haulage contract, at a monthly interest of 6.5 percent.
On November 28, 2014, the Attorney General appealed to the Supreme Court, but the highest Court of the Land dismissed the appeal.
As a fallout of the disagreement over the quantum of the judgment debt, the A-G, in 2019, went to the apex court, asking it to determine the amount.
The Attorney General, Mr. Godfred Dame submitted that in 2018, NDK wrote to his office, claiming about GH¢640 million as the judgment debt, and subsequently followed up in 2019 that the amount had ballooned to GH¢1.23 billion, and that it was prepared to accept GH¢450 million as final settlement.
Mr. Dame however on his part, urged the apex court to order that the state had already fulfilled its financial obligations by paying the GH¢79.5 million to NDK.
The court, therefore, ordered the auditing of the books by the PwC based on the Attorney General’s application and rejected the claims of NDK Financial Services.