Court bailiffs storm UT Bank HQ to seal it off over $110,000 judgement debt
Policemen and court bailiffs on Thursday went to the UT Bank headquarters at Airport in Accra to seal off the building following the bank's failure to obey a court judgement ordering it to pay Oxford Street Hotel, a private entity, $110,000.
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The policemen and bailiffs got there around 9:06 a.m. but left around 10:18 a.m. when lawyers for the bank produced court documents to prove the bank had filed for stay of execution of the High Court's judgement at the Court of Appeal.
The bank withdrew the said amount from the client's account for a service, which it failed to render.
The plaintiff’s lawyers, accordingly, moved in with the police and bailiffs to execute the court’s judgement which was awarded on June 12, 2017 but left when the notice of stay of execution was shown to them.
Stay of execution
The bank filed a stay of execution of the court's June 12, 2017 judgement but the court on July 24, 2017, refused the stay, saying the application had no merit.
The court, presided over by Mr Justice George Buadi, also held that the notice of appeal against its June 12, 2017 decision was incompetent, having been filed in the High Court and not at the Court of Appeal.
In the present circumstance, the bank's motion for stay of execution at the Court of Appeal will be moved on October 16, 2017.
Counsel for Oxford Street Hotel, Mr Charles Tetteh, told the Daily Graphic that his firm had not been served with the notice of stay of execution.
"I would not have gone for the services of the police and bailiffs if my firm had been served with the notice of stay of execution," Mr Tetteh said.
He, however, noted that “we will fight them using the legal process until justice is served.”
Background
In October 2014, in collaboration with the UT Bank, the plaintiff started negotiations with Bank of Beirut and Arab Countries (BBAC) in Lebanon for a loan of $2 million to complete its proposed hotel, Oxford Street Hotel Limited.
As a condition for the grant of the loan by the BBAC, the plaintiff was to provide a guarantee from a local bank, which has to be confirmed by a Class A Bank to be approved by BBAC.
The plaintiff averred that UT Bank agreed to and undertook not only to provide BBAC with the requisite bank guarantee but also to secure a Class A bank to provide the requisite confirmation guarantee for a total fee of four per cent of the loan amount, which translates to $80,000.
Based on the UT Bank’s undertaking and assurances that it would provide a Class A bank to confirm the guarantee, and as a condition for the guarantee, the UT Bank caused the plaintiff to pay $13,000 for the fire insurance policy covering the hotel.
The plaintiff further argued that its managing director had to make round trips to Lebanon for the purposes of signing documents with the BBAC on the loan but after a year, the UT Bank failed to honour its undertaking to provide a Class A bank to confirm the bank guarantee, causing the plaintiff to eventually lose the loan deal with the Lebanese bank.
On February 14, 2015, the UT Bank debited the plaintiff’s dollar account with $80,000 on account supposedly of “guarantee issuance charges.”
According to the plaintiff, the defendant debited its accounts with a total amount of $103,179.36, although, it failed to honour its pledge.
UT Bank admitted agreeing to provide the bank guarantee relying on a letter dated December 1, 2014 which was duly executed by the parties.
The bank justified the deductions from the plaintiff’s accounts, stating that “all fees, commissions or debits or deductions were in accordance with the agreement between the parties.”
Judgement
The Commercial Court division of the High Court in its June 12, 2017 judgement, held that it found it as a fact that the plaintiff did not receive the $2 million from BBAC Lebanon.
It said the BBAC did not disburse the $2 million due to UT Bank’s failure to provide the needed guarantee as agreed.
It awarded the plaintiff’s reliefs and directed the bank to pay interest on the amounts deducted from the plaintiff’s accounts from January 2015 to the date of final payment.
The court, however, declined to grant damages to the plaintiff on the grounds that the plaintiff had failed to prove his numerous travels were as a result of follow-ups on the BBAC facility.