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  • appeal
  • 1962-04-02
  • 1 GLR 218-221
  • Print



MortgagesNotice of demand for paymentExecution of power of saleWhether lawful.


On the 4th June, 1956, the appellant by deed mortgaged his cocoa farm to the respondent. The deed provided, inter alia, that:"The mortgagee has at that request of the mortgagor agreed to advance the mortgagor the sum of G500 for the purpose of buying cocoa beans and delivering same to the mortgagee at Teppa during the 1956-57 cocoa season until at the close of the season so that any amount of money shall be accounted for."The appellant then obtained advances totalling G300 and commencing from September, 1956, purchased and supplied cocoa to the respondent. On the 10th January, 1957, the defendant wrote a letter (exhibit 4) to the plaintiff notifying him that the season had closed, and that the plaintiff?'s account showed a debit balance which the respondent claimed should be immediately settled or else he would take further action. This letter was relied upon as constituting a proper notice of demand, non-compliance with which entitled the respondent to exercise his power of sale reserved in the mortgage. The respondent and his witness were not, however, able to testify as to the date on which this notice was served on the appellant.About the 2nd February, 1957, the appellant?'s indebtedness was reduced to G124 16s. 3d. As this was not cleared, notice of sale was served on the appellant and the farm was sold on the 8th March, 1957. On the 2nd April, 1957, the appellant wrote to the respondent saying that as the cocoa season closed at the end of March, he was ready to call at the respondent's office to close his account. To this the respondent replied after a six-week interval that the account between them had already been settled.The appellant sued the respondent for G300 damages for wrongful sale of his cocoa farm. He was unsuccessful in the High Court and therefore appealed.


APPEAL from a judgment dated the 5th April, 1960, delivered in the High Court, Kumasi (Howard Christian, Esq., Commissioner of Assize [p.219] and Civil Pleas) in an action for damages for wrongful exercise of a power of sale under a mortgage deed.


The events which led to the institution of the action resulting in this appeal are in the main undisputed and they are these: The plaintiff by deed of mortgage dated the 4th June, 1956, which was admitted at the trial as exhibit A, mortgaged his said cocoa farm to the defendant to secure advances of money up to the amount of G500 to be made by the defendant to him for the purchase and supply of cocoa to the said defendant during the period of the 1956-57 cocoa season. The provisions and/or terms of the said mortgage which are material to the determination of the issues which arose in this action will be referred to, and where necessary reproduced, in due course. Following the execution of the mortgage the plaintiff obtained advances up to the sum of G300 and, commencing from September, 1956, purchased and supplied cocoa to the defendant up to the end of December 1956. On the 10th January, 1957, the defendant wrote a letter, admitted at the trial as exhibit 4 addressed to the plaintiff notifying him that the season was then closed and that his (the plaintiff?'s) account showed a debit balance of G223 16s. 3d.; the defendant, further, by that letter demanded payment of that amount and threatened to resort to certain measures upon default in payment of the amount. The terms of this letter which was relied upon at the trial and is relied on in this appeal as constituting a proper or sufficient notice of demand, non-compliance with which entitled the defendant to exercise the power of sale reserved in the mortgage, will be referred to and considered in due course.

Continuing, however, with our narrative of events, the defendant supported by his second witness, one Kofi Boakye, alleged that copy of this notice of demand was served on the plaintiff at his residence at Teppa but both were unable to testify to the date of this alleged service. Thereafter on or about the 2nd February, 1957, cocoa to the value of G108 1s. 10d. was received from one Kwasi who stated that by arrangement with the plaintiff the amount was to be credited to the account of the plaintiff, and this being done the plaintiff?'s indebtedness was reduced to G124 16s. 3d. For non-payment of this amount of G124 16s. 3d., the defendant instructed a licensed auctioneer, one Daniel Antoh, the defendant?'s first witness, who according to his evidence, issued notice of sale on 16th February, 1957, served the plaintiff with a copy ten days thereafter, i.e. on the 26th February (because it could not be served earlier) and on the 8th March, 1957, sold the mortgaged farm by public auction and filed his account on the 12th April, 1957. Thereafter, the plaintiff wrote to the defendant on the 2nd April, 1957, a letter, copy whereof was admitted as exhibit B, the material terms of which were the following, "since the season of 1956-57 is ended, i.e., by the end of the month of March 1957 . . . . I would therefore be grateful for you to give a definite date on which I should call at your office for closing of my account with you". The defendant did not reply until the 15th May, 1957, when he replied in these terms:

"While acknowledging the receipt of yours under registered cover dated the 2nd April 1957 . . . in response thereto, I have to make it categorical to the effect that I have no account or accounts to make with you in any shape or form, since the outstanding debt between you as debtor and I as creditor, has been settled already." [p.220]

The plaintiff therefore proceeded to have the writ in this case filed on the 3rd July, 1957, by counsel on his behalf.

To appreciate the full import of the plaintiff?'s letter and in particular his reference to the cocoa season, one has to turn to the mortgage deed which contained the following important provision or term that:

"The mortgagee has at the request of the mortgagor agreed to advance the mortgagor the sum of G500 for the purpose of buying cocoa beans and delivering same to the mortgagee at Teppa during the 1956-57 cocoa season until at the close of the season so that any amount of money collected shall be accounted for."

In so far therefore, as the mortgage deed may be said to have made express provision as to the time for ascertaining the amount which may be due as the mortgage debt resulting from the business between the parties, before formal notice of demand for payment can be made or served upon the mortgagor, it seems clear that the instrument fixed the end of the 1956-57 cocoa season as such time. It is then that the parties would be entitled to call upon each other to meet to investigate or go into the accounts with a view to ascertaining and agreeing on what may be due and owing, before the mortgagee can exercise his right of ?"giving one month?'s notice in writing to the mortgagor to pay off the same; and if the mortgagor shall still have failed to pay the mortgage debt then remaining due and owing on this security one month next after the time of giving any such notice?" then the mortgagee?'s right to exercise the power of sale reserved in the mortgage arises.

The crucial question, therefore, which arose for determination, but which appears to have completely escaped the attention of the learned trial commissioner who did not address himself to it at all was, when did the 1956-57 cocoa season come to an end. Fortunately at the material times in 1956 and 1957 the dates of commencement and ending of the 1956-57 cocoa seasons were officially declared and published in the then Gold Coast Gazette, by the competent authority, the Cocoa Marketing Board. It seems only necessary therefore to make reference to the relevant publications and they are Notice No. 2069 in the Gold Coast Gazette of the 8th September, 1956, which notified that "the opening date of the 1956-57 main crop season is the 21st day of September 1956", and Notice No. 331 in Gold Coast Gazette of the 9th February, 1957, which notified that "the current main crop season will cease on Thursday the 28th day of February, 1957."

In the light of that disclosure it is evident that the defendant?'s so-called notice of demand dated the 10th January, 1957, in the following terms:

?"I have to bring to your notice that the season is now closed and you are requested to enter into an account and to settle same as quickly as possible. In the circumstances, I hereby serve you with this notice to expedite the settlement of your accounts in the sum of G323. 16s. 3d. which you know to be correct against you. That should you fail to assent to request nothing shall preclude me from resorting to any redemptionary measures possible?" is so grossly faulty, that the sale under it cannot but be unlawful. It is an improper and illegal notice, because principally it was given when the time fixed for giving it, i.e. after the close of the 1956-57 cocoa season, which we have discovered to be the 28th February, 1957, had not arrived; and the steps prescribed to be taken, i.e. the investigation of the accounts and ascertainment of what may be properly due, had also not taken [p.221] place. (See Selwyn v. Garfit1 followed in Lisk v. Barlatt2 and Akyeampong v. Atakora3 It follows that the sale pursuant to that notice dated the 10th January, 1957, must be and is hereby declared to be illegal.

The plaintiff, however, has not brought the purchaser into this action to claim setting aside of the sale and recovery of the property from him, but is content to claim G300 damages from the defendant. In all the circumstances I would allow this amount, especially as the auctioneer?'s declaration of sale, exhibit 3, declares that the farm was sold at G200 at public auction, and the plaintiff himself adduced no evidence of the loss sustained by him by the wrongful sale of the farm.

In the result I would allow the appeal and set aside the judgment of the trial court, and enter judgment for the plaintiff awarding him G300 damages for the wrongful sale of his farm as claimed.


I agree.


I also agree.


Appeal allowed.

Plaintiff / Appellant

C. F. Hayfron-Benjamin, Jnr.

Defendant / Respondent

J. D. Reindorf


(1)  Selwyn v. Garfit (1888) 38 Ch.D. 273

(2)  Lisk v. Barlatt (1938) 4 W.A.C.A. 56

(3)  Akyeampong  v. Atakora (1952) 14 W.A.C.A. 4

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