ERIC ASAE V GHANA GROWTH FUND COMPANY

JJUDGJUDGMENT

1.0                INTRODUCTION

 

1.1  The instant suit is based on a claim of an alleged unlawful termination of the service of employment of Mr Eric Asae (“the Plaintiff”) by Ghana Growth Fund Company (“the Defendant Company”); and some unpaid bonuses and sitting allowances due the Plaintiff by virtue of his role as a Board Member  in some other companies at the behest of the Defendant Company. 

 

2.0                BACKGROUND

 

2.1    Circa 2010, the Plaintiff was employed as the Risk Manager for Gold Coast Securities Limited. In   2012,  the Plaintiff transitioned  from  his   managerial role at Gold Coast Securities Limited to the role of an Investment/Risk Manager at the    Defendant Company. 

 

2.2    The Plaintiff averred in his Statement of Claim that he was also appointed as the Acting General Manager for Expandable Polystyrene Products and Trading Limited; the Project Manager for the GN  Bank  Branch Expansion – EPS Pilot Project of the Defendant Company; and a Board Member of the GN   Electronic Limited Expandable Polystyrene Products and Trading Limited and GN Logistics Limited. The Plaintiff purported that he  undertook these all these roles at the instance  of the Defendant

Company. 

 

2.3  By a letter dated December 20, 2016, the Defendant Company terminated the employment of the Plaintiff with immediate effect. In lieu of notice of the termination of the employment, the Plaintiff was paid a lump sum of Fiftythree Thousand and Forty Nine Cedis Ghana Cedis Twenty Two Pesewas (GHS 53,049.22), being the equivalent of the Plaintiff’s three month’s salary, by the Defendant Company.  

 

2.4  Displeased with the termination of his employment, the Plaintiff, by a letter dated February 6, 2017, made a demand for compensation from the Defendant Company for unlawful termination on the grounds that the said termination did not follow some procedure outlined under the Human Resource Manual of the Defendant Company. The Plaintiff further made a demand for the payment of Eighteen Thousand  United States Dollars ($18,000.00) representing unpaid Director’s sitting allowance for the year 2016 and Sixty Thousand Ghana Cedis (GHS 60,000.00) representing the unpaid bonuses for the year 2015 and 2016.

 

2.5 After no favourable response was received from the Defendant Company, the Plaintiff by a Writ of Summons and Statement of Claim instituted an action against the Defendant Company. During the course of the instant suit, the Plaintiff received an amount of Thirty Thousand Ghana Cedis

(GHS 30,000. 00) being bonus received for the year 2015 and 2016.

 

3.0                THE PLEADINGS 

 

3.1                PLAINTIFF’S CASE 

 

3.1.1 The Plaintiff averred in his Statement of Claim that until December 20, 2016 he was the Investment/Risk Manager, Acting General Manager for Expandable Polystyrene Products and Trading Limited and Project Manager for the GN Bank Branch expansion – EPS Pilot Project of the Defendant Company. 

 

3.1.2 The Plaintiff combined these functions with his role as Board Member of GN Electronic Limited and     GN Logistics Limited, at the instance of the    Defendant Company, and was entitled to Five Hundred dollars (US$ 500) or its cedi equivalent per month. 

 

3.1.3 By a letter dated December 20, 2016 the Defendant terminated the employment of the Plaintiff with immediate effect on the alleged basis that the Plaintiff’s services were no longer needed.  

 

3.1.4 The Plaintiff averred in his Statement of Claim that no process was initiated or concluded to evaluate the relevance or otherwise of the services he rendered to the Defendant Company. As such, the purported termination was “baseless, unsupportable in law, scandalous and could only have been actuated by ill-will thus arbitrary and capricious and also amounts to unlawful dismissal”

 

3.1.5 According to the Plaintiff, the termination of his employment by the Defendant Company was not compliant with the procedures for termination expressed in the Human Resource Manual of the  Defendant Company. 

 

3.1.6 By a Writ of Summons and accompanying Statement     of Claim filed on March 31,2017, the Plaintiff  instituted an action in this court seeking the following reliefs ;

 

(i)  Damages assessed at the total of Plaintiff’s three (3) years basic salary for unlawful termination and unlawful dismissal.

 

(ii) Recovery of the sum of US$ 18,000 being Plaintiff’s Director’s sitting allowance   for the year, 2016.

 

(iii) Recovery of the sum of GHS 60,000 being Plaintiff’s unpaid bonuses for the years   2015    and 2016.

 (iV) Interest on said GHS 60,000 from 1stJanuary, 2017 till date of final payment 

 

3.2                DEFENDANT’S CASE 

 

3.2.1  The Defendant by a Statement of Defence filed on April 24, 2017 responded to the Plaintiff’s case and stated that it was a private equity and venture capital firm specializing in investments at all stages of a company's life-cycle including start-ups, recapitalizations, leveraged buyouts, management-led buyouts, buy-ins, expansion and development capital, mature stage, strategic minority equity investments, equity private placements, consolidations and build-ups, buy and builds, and growth capital financing. 

 

3.2.2   The Defendant Company averred that it invested in property-level equity, debt and special situations transactions and businesses and typically invested in small and medium sized enterprises in infrastructural development, non-bank financial institutions, information technology, manufacturing, logistics, road, gas and oil inter alia.

 

3.2.3 The Defendant Company admitted that the Plaintiff was an Investment/Risk Manager in the Defendant Company but denied all the other roles the Plaintiff alleged he undertook at the instance of the Defendant. 

 

3.2.4  The Defendant Company also admitted that the Plaintiff was a Board Member of GN Electronic Limited and GN Logistics Limited, at the instance of the Defendant Company, but denied the allegation of the Plaintiff being entitled to a sitting allowance of US$ 500 or its cedi equivalent.

 

3.2.5   The Defendant further stated that in order to ensure that its investments in companies they set up and or managed succeeded business-wise, the Defendant through its managers closely monitored their affairs and physically participated in their decision making and management. 

 

3.2.6 The Defendant averred that it monitored and participated in the affairs of the companies set-up or managed by the Defendant Company, using a machine called the analyst; and each management employee of the Defendant Company was assigned by the analyst machine to monitor, supervise, manage and report on the 0ther companies the Defendant Company had invested in.

 

3.2.7  The Defendant averred that the Plaintiff was hired and paid to work based on this modus operandi and in performing the function the Defendant was at liberty to make an employee a board member, a managing director, an observer on the Board of Directors of the company concerned. 

 

3.2.8   The Defendant’s posited that the Plaintiff was not due any amount apart from his salary and the payment of any bonuses was the sole prerogative of the company involved. 

 

3.2.9  The Defendant denied all the other allegations of the Plaintiff. 

 

3.3  At the close of pleadings, the suit was set down for trial. Pursuant to the directions of this court, the parties filedWitness Statements for the conduct of the trial. A Case Management Conference was held and the suit proceeded to trial. Both parties called witnesses to testify on their behalf. 

 

4.0                ISSUES 

 

4.1      The Issues that are to be determined by this court are;

 

(i)   WHETHER OR NOT THE DEFENDANT’S TERMINATION OF THE PLAINTIFF’S EMPLOYMENT WAS LAWFUL

 

(ii)    WHETHER OR NOT THE DEFENDANT’S TERMINATION OF THE PLAINTIFF’S EMPLOYMENT WAS COMPLIANT WITH THE PROCEDURES FOR TERMINATION SET OUT IN THE DEFENDANT’S HUMAN RESOURCE MANUAL 

 

(iii)   WHETHER OR NOT THE PLAINTIFF IS ENTITLED TO  HIS CLAIMS            

(iv)   ANY OTHER ISSUES ARISING FROM THE PLEADINGS

 

5.0           STANDARD OF PROOF AND BURDEN OF PROOF 

 

5.1  It is trite learning that a party who invites this court to make a ruling or decision in his favour bears the onus of proving and providing proof for the allegations in his pleadings. Proof, has been defined by Ollenu J (as he then was) in oft quoted case of MAJOLAGBE V LARBI [1959] GLR 190 asthe establishment of fact by proper legal means i.e., the establishment of an averment by admissible evidence.

 

5.2  There are types of burdens of proof borne by a party to a trial.The burden of persuasion, under Section 10 (1) of Evidence Act (1975) NRCD 323;  which typically rests on Plaintiff to prove the existence or non-existence of a fact essential to his claim AND the burden of producing evidence under Section 11 (1) of NRCD 323 which requires the provision of evidence by a party to prevent    the court from making a finding of fact against them.  

 

5.3  Per Section 17 (1) of NRCD 323, the evidential burden can shift between the Plaintiff and Defendant at trial and the apex court has thoroughly discussed this phenomenon inthe case of SUMAILA BIELBIEL V. ADAMU DRAMANI & ANOR. (2012) JELR 92144

 

5.4                For civil matters such as this, the burden of persuasion generally requires proof on the preponderance of probabilities, by the Plaintiff,   under Section 12 (2) of NRCD 323.

 

6.0                RESOLUTION OF THE ISSUES

 

6.1                This court will resolve the first and second issue together as the second issues flows from     the first.  

 

6.1.1        The employer - employee relationship is a consensual contractual relationship governed by a set of terms that are either express or implied. Just as any other contract, the employment contract can be determined or brought to an end in numerous ways provided under common law or by legislature.  

 

6.1.2          At common law, the contract of employment may be terminated by either the employer or the employee according to the terms of the contract of employment. In the absence of such terms, the employment may also be terminated at will with or without apportioning any reason for the termination, subject to the terms of the contract of employment. 

 

6.1.3 The common law position has been succinctly dealt with in the case of of Kobi v. Ghana Manganese Co Ltd [2007-2008] 2 SCGLR 771, where Atuguba JSC states at page 775 as follows:

 

“What I consider to be trite learning on this issue is that a contract of service is not a contract of servitude. That being so, even if the contract of employment is silent on the question whether it is terminable, the common law implies a right to terminate the same by either side upon reasonable notice to the other ... Subject to this the right to terminate a contract of service is dependent on the terms of the contract and must be exercised in accordance therewith.”

 

6.1.4           Section 17 of Labour Act, 2003 (Act 651) codifies the common law position

and provides as follows:

 

(1)             A contract of employment may be terminated at anytime by either party giving to the other party,

 

(a)           In the case of a contract of three years or more, one month’s notice or   one month’s pay in lieu of notice;

 

(b)           In the case of a contract of less than three years, two weeks’ notice or two weeks’ pay in lieu of notice; or

 

(c)           In the case of contract from week to week,  seven days’ notice.

 

(2)             A contract of employment determinable at will by either party may be terminated at the close of any day without notice.

 

(3)             A notice required to be given under this section shall be in writing.

 

(4)             The day on which the notice is given shall     be included in the period of the notice."

 

6.1.5 Whilst common law and the Labour Act recognises that an employment contract is not a contract of servitude thus making it determinable at any time by the parties; our legislators recognised the potential misuse of the termination right by some employers. In order to solve this, our legislators introduced the concept of unfair termination under Section 62 to 64 of Act 651 and in the case NATIONAL LABOUR COMMISSION V. BARCLAYS BANK GHANA LTD (2023) JELR 111609 (SC) the apex court discussed whether Sections 62 – 64 of Act 651 outlawed the employer’s right of termination under common law. 

 

6.1.6 In NATIONAL LABOUR COMMISSION V. BARCLAYS BANK GHANA LTD supra, Kulendi JSC, speaking for the majority, posits that the right of unilateral termination was still open to either party in an employment contract. This is because the employer’s right of termination under common law is codified under Section 17 of the Labour Act. Secondly, Section 62 of Act 651 provides the instances under which the termination of an employee is deemed fair whilst Section 63 on the other hand provides the instances under which termination will be deemed unfair. Thereafter, Section 63 (4) provides that termination may be unfair if the employer fails to prove that the reason for termination was fair, or the termination was done in accordance with fair procedure or the Labour Act. With Section 17 recognising the employer’s right to unilaterally terminate a contract and the disjunctive nature Section 63 (4) of Act 651, indicating that there other instances of termination, termination done under Section 17 will be deemed fair by the Labour Act. 

 

6.1.7        It is the case of the Plaintiff that the termination of his employment amounted to unlawful dismissal. Thus, the Plaintiff was required to prove that the termination of his employment by the Defendant Company was not done in accordance with Act 651. The Defendant Company, on the other was required to prove that the termination of the Plaintiff’s employment was done in accordance with the Labour Act to avoid any liability. 

 

6.1.8   The Plaintiff averred that his termination did not comply with clause 7.3 of the Human Resource Manual of the Defendant Company marked Exhibit MG1. It is the position of the Plaintiff that the Defendant Company could not terminate his employment unless it was done in compliance with the Exhibit MG1. The Defendant Company, on the other hand argues that it can still exercise its right of termination outside of the Human Resource Manual.  

 

6.1.9       The employment contract is not a contract of servitude and either party to the contract can terminate the contract subject to its terms. The Plaintiff asked the court to regard the Clause 7.3 of Exhibit MG1 as the only clause by which the termination of the Plaintiff’s employment. However, a careful reading of the Foreword of Exhibit MG1 indicates that the manual is not to be regarded as the contractual entitlement of an employee and further states that there exists a separate employment contract that governs the relationship between the employer (Defendant Company) and the employee (the Plaintiff). 

 

6.1.10           The Plaintiff was duly employed by the Defendant Company and as such, this court surmises that it entered into a contractual relationship with the Defendant Company. As already established, section 17 of Act 651 reserved the employer’s unilateral right of termination provided under common law subject to the terms of employment contract between the parties. The Plaintiff was therefore required to provide the court with his employment contract to provide the court with a reference point to assess whether or not his termination was compliant with the employment contract. 

 

6.1.11            The Plaintiff, failed to provide this court with any contract of employment to enable same determine the terms under which the Defendant Company could terminate his employment and the court finds that Exhibit MG1 is not the employment contract existing between the parties. Therefore, in the absence of an employment contract, Defendant could exercise its right of termination under common law which has been codified under section 17 of

Act 651. 

 

6.1.12    Although the court finds that Defendant could exercise its right of termination, the Defendant, was required to prove that the exercise of its right was compliant with the Act 651; making the termination a fair one. Per Exhibit MG3, the Defendant Company provided this court with proof of the payment of Fifty-three Thousand and Forty Nine Cedis Twenty Two Pesewas (GHS 53,049.22) to the Plaintiff. This amount was the sum of the Plaintiff’s basic salary of three month’s given to the Plaintiff in lieu of the notice. The Plaintiff, through his witness at trial, agreed that this amount was

paid to him. The court finds that the payment of GHS 53,049.22 by the Defendant Company was done to fulfil the Defendant’s obligations under Sections 17 and 18 (4) of the Labour Act 2003, Act 651. The court also finds that the Defendant discharged its burden under Section 63(4) of Act 651 and proved that the termination of the Plaintiff’s employment was fair and compliant with the Labour Act.

 

6.1.13     It is important to note that although the court does not deem Exhibit MG1 as

the contract of employment between the Plaintiff and the Defendant, it acknowledges that Exhibit MG1 provides the employee with a guide to the personnel policies and procedures that are relevant to the employee. In analysing Clause 7.3 of Exhibit MG1, the latter part of the clause provides as follows: 

 

“This means that GGFC will terminate employee service in cases non-performance, or breach of contract and code of conduct, etc as specified in employee contract, or statutory notice. The organization will terminate employee services after all the alternatives have been investigated, or if there are serious

resource constraints or other causes beyond the control of

GGFC”.

 

The court is of the opinion that the above qualifies the instances in which Clause 7.3 applies. The termination stipulated under clause clearly applies to matters premised on the failure of the Plaintiff to perform a duty or obligation required of him by the employer, the employment contract or the company’s code of conduct. 

 

6.1.14 In Exhibit MG2, the Defendant Company stated that it was terminating the Plaintiff’s employment because the Plaintiff’s services were no longer needed. Although the courts have held that an employer is not required to give reason for the termination of the employment of an employee [See Kobeah v Tema Oil Refinery [2003 – 2004] 2 SCGLR 1033; Aryee v. State Construction Corporation [1984 – 86] 1 GLR 425; Akufo & ors v Volta

Aluminium Co. Ltd [1999 – 2000] 2 GLR 801 ], the reason given by the Defendant Company for the termination of Plaintiff’s employment does not connote a breach of any duty or obligation which will make the termination fall within the scope envisaged under Clause 7.3 of Exhibit MG1. Therefore, Plaintiff cannot aver that his termination was unlawful or illegal by reason of the fact that it was not compliant with Exhibit MG1 when the termination

has been established to fall outside the scope envisaged under Exhibit MG1. 

 

6.2 Issue III - Whether or not the Plaintiff is entitled to his claims 

 

6.2.1             The first relief sought by the Plaintiff in his Writ of Summons and Statement of Claim is Damages assessed at the total of Plaintiff’s three (3) years basic salary for unlawful termination and unlawful dismissal.  

 

6.2.2 From the resolution of the first and second issues, this court finds that the Defendant Company terminated the employment of the Plaintiff fairly. The termination did not fall within the scope outlined under the Human Resource Manual of the Defendant and such cannot be said to be in breach of the procedure outlined under same. The court therefore finds that the Plaintiff is not entitled to his first claim.

 

6.2.3  The second relief sought by the Plaintiff is the recovery of the sum of US$ 18,000 being Plaintiff’s Director’s sitting allowance for the year, 2016.  

 

6.2.4 The Plaintiff in his Statement of Claim averred that he was the Board Member

of GN Electronic Limited and GN Logistics Limited, at the instance of the

Defendant Company, and was entitled to Five Hundred dollars (US$ 500) or its cedi equivalent per month. KLAH v. PHOENIX INSURANCE [2012] 2 SCGLR 1139 @1150 -1151 provides that 

 

“Where a party makes an averment capable of proof in some positive way e.g., by producing documents, description of things, reference to other facts, instances and his averment is denied, he does not prove it by merely going into the witness box and repeating that averment on oath or having it repeated on oath by his witness. He proves it by producing other evidence of facts and circumstances from which the Court can be satisfied that what he avers is true.”

 

6.2.4.1  Per the evidential rules, the Plaintiff is required to prove every assertion contained in his pleading. However, in WEST AFRICAN ENTERPRISE LTD v. WESTERN HARDWOOD ENTERPRISES LTD [1998-1999]SCGLR 105 where an averment of a party is admitted, the requirement to prove that averment is dispensed. In Paragraph 5 of the Defendant’s Statement of Defence, the Defendant admitted that the Plaintiff was a Board member of the aforementioned companies but denied the fact that the Plaintiff was entitled to a monthly pay of US$ 500 and the fact that the Defendant owed the Plaintiff US$ 18,000 in unpaid Director’s sitting allowances. 

 

6.2.4.2     The court will address this claim in two-fold. The admission of the fact that the Plaintiff was a Board Member of the aforementioned companies dispensed the need for the Plaintiff to prove this fact. However, the denial of the renumeration and unpaid allowance by the Defendant in its Statement of Defence placed a burden on the Plaintiff to provide proof of a monthly renumeration of US$ 500 and proof of the unpaid US$ 18,000 being Director’s Bonus. When the Plaintiff’s witness was cross examined on this issue on November 28, 2017 the witness stated as follows: 

 

Q: In that same paragraph you said the Plaintiff  acting in those capacities was  entitled to USD500 or its cedi  equivalent      per month.

 

A: That is correct my lord. As the Plaintiff has been paid that amount in previous years.

 

Q: Do you have any evidence of these payments made to the Plaintiff by the Defendant in the previous years?

 

A: My lord I do not have evidence with me here but it can be provided to the Court  in the form of the Plaintiff's bank  statement  that     those payments were made  into.

The Plaintiff failed to provide any bank statement to prove he was ever paid an amount of US$ 500 as monthly renumeration for a Board Member or Director of the aforementioned companies. It is also unknown, to the court, how the Plaintiff came to the conclusion that he was due an amount of US$ 18,000, as unpaid director’s sitting allowance, because proof of same was never provided to this court. In failing to satisfy the rule in KLAH V PHOENIX INSURANCE supra the court, respectfully, is not inclined to believe that what the Plaintiff avers is true. Thus, the court finds that the Plaintiff is not entitled to his second relief.

 

6.2.5  The third and fourth reliefs sought by the Plaintiff are the recovery of the sum of GHS 60,000 being Plaintiff’s unpaid bonuses for the years 2015 and 2016 and interest on the said GHS 60,000 from 1st January 2017 till date. As previously discussed, the Plaintiff was required to provide the court with cogent proof of this averment. The Plaintiff did not provide the court with any basis upon which he was entitled the amount of GHS 60,000 as bonus for the year 2015 and 2016. It is important to note that during the course of the trial the Plaintiff received a bonus of GHS 30,000.00 for 2015 and 2016. The Defendant Company provided proof of this fact in Exhibit MG4 series. In the email trail of Exhibit MG4 series, the Plaintiff acknowledged receipt of the bonus but questioned whether the sum of GHS 30,000 was the bonus amount for the years 2015 and 2016. However, at trial, the Plaintiff did not provide the court with any reason why he was entitled to the amount of GHS 60,000 instead of GHS 30,000; making it difficult for the court to ascertain which exact amount was due the Plaintiff. Therefore, in the absence of any proof from the Plaintiff on why he is entitled to GHS 60,000 the court is not inclined to grant reliefs (iii) & (iv) as it may lead to the unjust enrichment of the Plaintiff who was already paid a sum of GHS 30,000 during the course of

the suit. 

 

7.0                CONCLUSION 

 

7.1  Upon a careful consideration of the evidence provided to the court by both parties, the court finds that the Defendant’s termination of the   Plaintiff’s employment was lawful. The Defendant   exercised its right of termination provided   under common law and codified under Section 17   of Act 651 and the termination of the Plaintiff’s employment was not within the scope of the instances provided under the Defendant’s Human Resource Manual; as such the Defendant was not required to comply with Clause 7.3 in this instance.  

 

7.2  The court therefore dismisses the instant suit as it is without any merit and finds in favour of the Defendant.

 

7.3       Final cost of Ten Thousand Ghana Cedis (GHS 10,000) is awarded against

the Plaintiff in favour of the Defendant.

 

                                                                           

 (SGD.)

 H/L ANANDA JULIANA AIKINS (MRS.)                                                     

JUSTICE OF THE HIGH COURT  

1.0

INTRODUCTION

UDGME

INTRODUCTI