IN THE HIGH COURT OF THE GAMBIA M. GENE FIELDER.PLAINTIFF. ANSUMANA MARENAH (Trading as Julakay Fast Food Restaurant)..

Transcription

1 IN THE HIGH COURT OF THE GAMBIA CIVIL SUIT NO: HC/175/09/CO/058/D2 BETWEEN: M. GENE FIELDER.PLAINTIFF AND ANSUMANA MARENAH (Trading as Julakay Fast Food Restaurant)..DEFENDANT Wednesday 24 th November Before Hon. Justice E.O Fagbenle Case called: K. Sanyang for the Plaintiff U. Achigbue for the Defendant Parties Absent JUDGMENT By Writ of Summons issued on the 8 th of April 2009, the Plaintiff seeks the following reliefs against the Defendant: (1) Recovery of D1, 900,000 (One Million Nine Hundred Thousand Dalasis) being monies paid by the Plaintiff to the Defendant for a consideration that has wholly failed; (2) D200, 000 (Two Hundred Thousand Dalasis) damages for breach of contract; (3) Interest on (1) above at the prevailing Commercial Bank Rate; (4) Cost; and (5) Any further or other Orders as the Court may deem fit to make in the circumstance. 1

2 The Statement of Claim reveals that the Defendant presented a business proposal in September 2007 the Plaintiff to invest in a Fast Food Restaurant. The Plaintiff was convinced and invested in the said business in the form of a loan of D1.6 million with interest of 20% per annum from 5 th November 2007 and a loan agreement was signed for that purpose. That a further D300, 000 (Three hundred Thousand Dalasis) was advanced to carry out further works on the Restaurant on 31 st March That the Defendant has refused to pay neither the principal nor the interest despite repeated demands. In the Statement of Defence, the Defendant asserts that the Plaintiff had invested in the Restaurant Business to the tune of D1, 900,000 (One Million Nine Hundred Thousand Dalasis) for which he acquired 25% shares for the amount invested. That 20% of the loan was payable after the Restaurant commenced business but the principal was not repayable. That the works on the Restaurant is still on going and that the Restaurant will become operational in one year, which is That the Defendant owes the Plaintiff nothing at present. The Plaintiff testified in person and tendered exhibits MG1, the business projection. He stated that he gave Defendant D1, 600, 000 (One Million Six Hundred Thousand Dalasis) for the Restaurant to be completed in February That he gave D300, 000 (Three Hundred Thousand Dalasis) as addition when Defendant requested for more funds and also gave six (6) men to work with the Defendant for six months at the Plaintiff s expense. That he did so, so that the Restaurant can start running to enable him get his money back on time. He tendered the loan agreement as Exhibit MG2. That he gave a loan and not an investment in the business as shareholder. That reference to 25% in Exhibit MG2 2

3 was Marenah s way of showing appreciation and was his personal undertaken. That defendant promised to get a loan to repay the Plaintiff but has failed to do so. Clause 2 of the agreement stipulated that the maturity date of the loan was 12 months upon the opening of the Restaurant. That the opening date of the business was February, That the Restaurant was not opened because construction has not completed because for over one year, there was no work done on the site. That he did not agree to any 25% stake as stated in the agreement because he only provided funds for financing only. He admitted he had no license to grant loans with interest. The Defendant also testified in person. He stated that the Plaintiff offered to invest D1.6 million in the Defendant s Business when he declined joining their cattle business. That the Plaintiff offered to take 25% stake in the Defendant s business. That Plaintiff later provided a further D300, 000 (Three Hundred Thousand Dalasis) adding up to D1, 900, 000 (One Million Nine Hundred Thousand Dalasis). That a lawyer was then brought in and he prepared Exhibit MG2 which was between the Plaintiff and Julakay Fast Food c/o Julakay Inter Holding Limited. The defendant admitted that the amount provided by the Plaintiff was a loan which was to be repayable with interest. The repayment was when the Restaurant is completed and started operating. But the Restaurant is not yet operating, because it is still under construction. Letter of demand from Plaintiff was tendered and admitted as Exhibit AM1. He admitted in cross examination that the Plaintiff gave him a loan for the financing of the Restaurant business. That he had received the D1.6 million before the loan agreement was executed. He denied saying that the Restaurant construction will be completed in February 2008 but that it can be completed between 2008 and 2009, but that is not contained in Exhibit MG2. That it is the Plaintiff who proposed to him to advance him additional facility of D300, 3

4 000 (Three Hundred Thousand Dalasis) which is also not included in Exhibit MG2. He denied that Plaintiff gave him free labourers to assist the construction work. Both parties filed and exchanged written addresses. The Defendant in his address raised the incompetence of the suit against the Defendant and that the Money Lenders Act precludes the Plaintiff from recovering the money he advanced to the Defendant because he had no license to give loans with interests. The Plaintiff on the other hand relied on the case of Tinsley vs. Milligan (1992) 2 AER 391 as a mitigating authority provided by equity to temper the harshness of the law. I presume the issues are straight forward enough. The Defendant has admitted that the entire transaction was done by himself on behalf of Julakay Fast Food which is c/o Julakay Company Limited. What is admitted need no further proof. The claim is properly made against Ansumana Marenah Trading as Julakay Fast Food Restaurant. It was never stated or agreed that Julakay Company Limited was at any time a party to the transactions. Exhibit MG1 itself is headed Julakay Fast Food Restaurant Business Proposal August Its content was prepared by the Defendant and the purpose was to secure a loan to complete the construction with the expressed representation of repaying same. It is clear that Exhibit MG2 is a loan agreement between the Plaintiff and Julakay Fast Food which is being operated by the Defendant c/o Julakay International Holding Limited and the purpose was to secure a loan to jump start the Defendant s restaurant business. The maturity date was 12 months upon opening of the restaurant business (or) any time before, subject to the borrower s ability to pay. Interest was agreed at 20% per annum calculated from the date of recovering the amount of the loan. It was also stated that the said loan shall represent a total investment of 25% of the shares in 4

5 borrower s Restaurant Business. Paragraph 5 which formed the fulcrum of Defendant s assertion that the loan money provided by the Plaintiff was for 25% shareholding in the Restaurant business did not say so. It is couched rather as an expression of what percentage the loan taken represent in the full value of the Defendant s business. It did not say that Plaintiff is given or has acquired 25% stake as a result or in return for the loan money advanced by the Plaintiff otherwise the need to repay will not be so expressly stipulated in Exhibit MG2. The Defendant did not deny receiving D1, 900, 000 (One Million Nine Hundred Thousand Dalasis) from the Plaintiff, so the said sum is outstanding against the Defendant. Although it was invested in the restaurant business, if the business did not start within the projected time and now as admitted by the Defendant, no work is ongoing at the site after the Defendant has taken the Plaintiff s monies; is the Plaintiff then entitled to take steps to recover the money he advanced? I think yes. It is the Defendant s contention that the Plaintiff is not entitled to recover the loan so advanced, received and utilized by the Defendant because the Plaintiff has no license to give loans with interest, relying on Sections 2 and 3 of the Money Lenders Act Cap. 91:04 Laws of the Gambia, which rendered the loan transaction an illegality. The Defendant s reliance on Sections 2 and 3 appears irrelevant because Section 2 is the definition Section while Section 3 raised presumptions that rendered anyone who lends money at interest to be deemed as a money lender within the Act until the contrary is proved. Section 5 of the Act is the relevant Section that provided a penalty for anyone who engaged in the business of money lending without a license. But it is not to be used as an engine of fraud. It did not say that the lender cannot recover his principal. He may not recover the interest since he has no legal power to so contract. Although the Defendant has raised a valid issue of absence of lender s license, still the 5

6 Defendant is estopped from profiting by his own act having participated in the same transactions. It is against equity, good conscience and public policy to do so. See: the case of Okafor vs. Soyemi 92001) NWLR 698 at page 468 held 5. See also the case of Ajilo vs. Savannah Bank Limited where the Supreme Court of Nigeria refused to allow the Appellant to profit from his own failure of obtaining Governor s consent as a basis for canvassing for non enforcement of his mortgage which did not have Governor s consent/approval to the Respondent Bank. The case of Tinsley v Milligan (1992) 2 AER 393 is similarly relevant. There, their Lordships held that a party seeking equity must come with clean hands. That the Court, whenever confronted with the defence of illegality, will adopt a flexible and pragmatic approach in applying the maxim ex turpi causa, non oritur action and will consider whether the enforcement of the maxim will be an affront to public conscience, by balancing the adverse consequences of granting the relief against the adverse consequences of refusing it. This is the same situation in this case. It will certainly be an affront to public conscience in this society to allow the Defendant collect money from the Plaintiff, who is not a known Banker or money lender, and thereafter hide behind Sections 2 and 3 op cit, Section 5 of Cap 91:04 Laws of the Gambia 1990 as a shield. In good conscience, the Defendant will not be allowed to do so. The Defendant is liable to pay back the sum of D1, 900, 000 (One Million Nine Hundred Thousand Dalasis) loan money received from the Plaintiff for the construction of Defendant s Restaurant Business. More so, the evidence led by both side was that the D1.9 million loan was advanced before Exhibit MG2 was prepared and signed by the parties. The Plaintiff is not entitled to any interest on the amount so advanced because he cannot be allowed to profit from the illegality; he not being a licensed money lender. It is because of the same reasons that the claim for damages must 6

7 fail otherwise it will amount to awarding under the guise of damages, the very interest which the Plaintiff is not entitled to receive. In conclusion, claim (1) for the recovery of D1, 900, 000 (One Million Nine Hundred Thousand Dalasis) succeeds and judgment is granted in that sum in favour of the Plaintiff against the Defendant with 4% interest from the date of judgment until the entire sum is fully liquidated. Claims 2, 3 and 4 fails and are dismissed. There shall be no order as to costs.. HON. JUSTICE E.O FAGBENLE JUDGE ISSUED UNDER THE SEAL OF THE HIGH COURT AND THE HAND OF THE PRESIDING JUDGE THIS 24 TH NOVEMBER REGISTRAR 7