Andrew Awuni and Tony Lithur
AN ACCRA Commercial Court yesterday ruled that Andrew Awuni, the executive director of Centre for Freedom and Accuracy, has no capacity to institute a legal action over the sale of Merchant Bank to Fortiz, a private equity fund.
The court, presided over by Justice Sophia Bernasko Essah, said the fact that Mr. Awuni was a contributor to SSNIT, whose 90.6 per cent shares in Merchant Bank were being sold to Fortiz, per se did not clothe him with a capacity to fight against a decision taken by the Board of Trustees, managers of the pension fund.
Immediately the court gave its ruling, Fortiz named Nilla Selormey as the Managing Director of the distressed bank.
Ms Selormey was earlier named a member of the Board of Directors.
A statement signed by Emmanuel Botchwey on behalf of the Board stated that Nilla Selormey had been appointed the new MD of the bank.
The ruling was in respect of a motion brought by Tony Lithur, counsel for Fortiz, contesting the capacity of Mr. Awuni to initiate an action seeking to stop SSNIT from selling the distress bank to Fortiz for a pittance.
SSNIT, Fortiz, Bank of Ghana, Merchant Bank and 10 others were joined in the suit.
Mr. Lithur?s motion was one of the four motions before the court challenging the capacity of Mr. Awuni.
Justice Essah stated that the plaintiff was not a shareholder in Merchant Bank and had no business bringing the matter to court.
The judge indicated that by law, it is the Board of Trustees who shall be in charge of the investment policy of SSNIT and that Mr. Awuni?s claimed right in the involvement of the investment plans of his contribution was incorrect and, therefore, could not hold water.
According to the judge, it was a member of the board of Trustees who could sue and not a contributor, pointing out that even the authorities cited by Mr. Faibille to support his stance were not undertaken by a sole contributor but trustees.
Giving a chronological account of how SSNIT was managed, the judge observed that the activities of SSNIT were structured and regulated by the Social Security Law, 1991 (Act 247).
The court said the plaintiff?s right could not override the mandate of the trustees and directors of Merchant Bank and that if the court should uphold Awuni?s arguments, it would mean that every contributor was equal to the trustee or board and, therefore, could question every action taken by the trust.
The National Pension Regulatory Authority (NPRA), she stated, had the duty to ensure the activity of the trust was in line with the law.
Mr. Awuni, she observed, never asserted that he brought the action in the public interest but in his sole capacity.
Although the court had a duty to protect the constitutional right of citizens, it was also the duty of the citizen to show which right of his was being infringed or trampled upon.
The judge questioned the right of Mr. Awuni which has been infringed upon in the decision taken by the board to sell Merchant Bank.
Justice Essah, who agreed that the public was well represented on the board, stated that the only right Mr. Awuni had was related to his pension entitlement which upon death could be obtained by family.
?This is a right to his pension for which he can sue. That is when the decided payment due him is in jeopardy,? she said.
The court subsequently dismissed Mr. Awuni?s case for want of capacity without awarding any cost.
Benson Nutsukpi, lawyer for Merchant Bank, after the ruling, prayed the court to give an order to cover the other three similar motions pending since the court had indirectly ruled in their favour that Awuni had no locus.
However, Mr. Faibille objected, saying they should be ruled upon one after the other based on their merits and the court agreed.
Ruling on the other motions brought by SSNIT, Bank of Ghana and Merchant Bank was scheduled for January 27, 2014.
Mr. Faibille, who did not seem satisfied with the ruling, hinted that he would go on appeal.
Explaining why he would appeal, Mr. Faibille said ?if the position of the court is that, yes, you are a contributor to SSNIT but if SSNIT uses your money for any other thing which does not bring profit and will affect your pension in future, you have no right to question,? then we now know that people will advise themselves whether it is even worth putting your money in a trust that is not accountable to you.?
Mr. Faibille disagreed that the contributors were well represented on the board, saying ?on the Board of SSNIT, there is a representative of the Ghana Armed Forces, but soldiers are not contributors. Why should I put my money in a trust for army officers who do not contribute to SSNIT to manage it for me??
Mr. Lithur also had a problem with the court not awarding cost.
He told journalists that the action by Mr Awuni had caused huge damage to Fortiz and Merchant Bank and, therefore, deserved huge punitive costs.
Mr Awuni was challenging the sale of Merchant Bank to Fortiz following a Bank of Ghana?s approval of a deal for the equity fund managers to pay GH?90 million for a 90-per cent stake in Merchant Bank.
He described the transaction as fraudulent and not showing value for money and, therefore, hauled 13 corporate bodies and individuals to court.
As part of the reliefs, Mr. Awuni was seeking a perpetual injunction to stop any further transactions on the sale of the 90.6 per cent shares of the distressed bank and to prevent BoG from issuing any licence to Fortiz to operate Merchant Bank as a validly acquired concern.
By Mary Anane