GH¢2.4 billion judgement debt looming

The agreement between District and Municipal Assemblies and Ghana First indicated that the Assemblies were supposed to provide land title documents for this project, which they signed undertakings promising to provide to Ghana First for onward delivery to their bankers but they failed to fulfill their part of the agreement after 6 years and still counting.

From 2018 to 2023, not one of the assemblies has been able fulfill that, and some of the assemblies have turned out conniving with third parties to change the specifications of the project and complete it without consent from Ghana First as the project owner. In the agreement Ghana First is the project owner and the assemblies are project partners. The agreement is for 30 years, and Ghana First owns 90% of the project and the assemblies own 10%. After 30 years, the shares owned by the assemblies will increase to 30% and that of Ghana First will drop to 70%.

The agreement states,

“That the Project Partner hereby covenants that the land it shall provide shall be its self-acquired land with title, right and or interest in the said land having vested in the Project Partner. Furthermore, the land so provided shall be vested to the project owner who is authorized to use the respective land for the purpose of securing funding only for this project.

ill. That the Project Partner hereby covenants further that in the event it has no self-acquired land then it shall facilitate and ensure the acquisition of a third party’s land.

1. That the Project Partner hereby further covenants that whether the land

for the project is its self-acquired land or a land belonging to a third party it shall bear the sole responsibility of procuring the said land for the project free from all encumbrances, examples being that it shall be free from litigation whatsoever or any adverse claim or defect in its usage for the project under any circumstance in this instance conditions in clause 3ii supra also apply.

1. That the Project Partner shall ensure that the Assembly itself, agents, privies, assigns, servants, workmen whomsoever or otherwise howsoever during the tenure of any government shall not dispossess the Project Owner from its ownership and that no person at law shall take over the property comprised in the project herein either permanent or temporarily and that the project is indemnified against all government interferences. All related legal cost arising out of government interferences shall be borne by the Assembly.”

So, some few months ago, Ghana First’s lawyers wrote demand notice to the assemblies, giving them 14 days to submit the land titles else they will seek legal action, and they failed again to comply with that and so Ghana First’s lawyers sent them a NOTICE OF INTENTION TO ISSUE A WRIT OF SUMMON AGAINST THE MUNICIPAL/DISTRICT ASSEMBLY AND THE LOCAL GOVERNMENT PURSUANT TO SECTION 210(1) OF THE L O C A L GOVERNANCE ACT (ACT

936). And it is in this notice that Ghana First included the cost of delay of the projects which is between 300% to 320% from the time of the issuance of the contract till date. One of the assemblies that is involved in this situation is the Akuapem South District Assembly, and to them the lawyers of Ghana First wrote, “The purpose of this letter is to give you formal notice of our clients’ intention to issue a writ of summons

against the aforementioned Assemblies for breach of the agreement between the Assemblies and our clients.

Our clients intend issuing a writ of summons against the Assemblies for breach of the agreement and for any other ancillary reliefs flowing from the breach of the agreements.

Specifically, in respect to Akuapem South District Assembly the damage our client is seeking as result of the breach of contract is

GHC 30,652,728.90

This has occasioned as a result of your failure to provide the necessary land documentations to our client to enable our client

secured bank facility as agreed in the Agreement / undertaking/ Request. And as a result of your failure to provide these lands documentations which are condition precedent to the agreement, the cost of the project astronomically increased due to inflation.

In addition, our client will be seeking an order of injunction from the Court restraining all third parties illegally operating and trying to complete all projects commenced by our client.

Our clients intend to issue the writ of summons thirty (30) Days upon receipt of this notice if the Municipal /District / Metropolitan Assemblies fail to remedy the breach within the said thirty (30) days period.

The said Agreements were facilitated and subsequently executed by the District/Municipal/Metropolitan Assemblies with our clients by the Ministry of Local Government and as such the Ministry would also be made a party to the said action to be commenced.

PLEASE TAKE NOTICE that this is to satisfy the requirement of the law as provided in the Local Governance Act specifically section 210 of Act 936.”

It is key to note that there are 148 assemblies that have agreement with Ghana First and the total cost accumulated varies based on the number of contracts issued per assembly.

In view of all this, all the 148 assemblies were put together and the President was notified, and the following institutions were copied,

1. The Minister,

Ministry of Local Government and Rural Development Accra.

2. The Minister,

Ministry of Justice and Attorney General Department Accra.

3. The Minister,

Ministry of National Security Accra

4. The Chairman, Counsel of State

Accra.

5. The Director,

Bureau of National Investigation (BNI).

This situation has been in existence for a while, even when the contractors were agitating and demanding for payments, and the company and it’s CEO, Mr. Frank Akuley being arrested and both he and the company were put through turmoil but the assemblies sat quietly knowing that they have to fulfill their part of the agreement. It would be necessary to note that in 2020, during the President’s campaign in Kumasi, which is his strong hold, a group of Ghana First contractors gathered to demonstrate against him because of this situation and yet the assemblies and the local government ministry sat unconcerned. Many communities have been affected by this delay and negligence by the assemblies and members of the communities have expressed displeasure with the delay in completion of the projects because some older facilities have been broken to be replaced by this project and the situation is worrying. Projects are at various stages of completion.

In light of this, the situation could potentially lead to judgement debt because Ghana First’s lawyers are waiting for the said 30 days, and if after the 30 days notification, the government and other relevant institutions don’t take necessary action, then the lawyers will proceed to court, which could lead to judgement debt amounting to over GH¢2.4 billion, which the government is likely to pay based on the facts and evidence of the case. It would be wise for the government to remedy the situation before Ghana First proceeds to court, otherwise the state would have to use taxpayers’ money to settle this debt, which is going to the be detrimental to the finance of the economy.

The information available to the paper is that after Ghana First goes to court, the legal team of Ghana First will organize “Meet the Press” so that they can explain the reason why they are in court and allow the media ask questions so that the public can have better understanding of the what transpired and every Ghanaian will follow the case.