AMOAH v. POKU
AMOAH v. POKU
POKU
[1965] GLR 155
HEADNOTES
The appellant during the 1956-57 cocoa season mortgaged his cocoa farm for the sum of £G500 for the
purpose of buying cocoa beans to be delivered to the mortgagee in payment for the loan. The mortgage
provided that if at the expiration of the mortgage period, i.e. 28 February 1957, the appellant failed to
make payment, the mortgagee could exercise his right of sale after giving one month’s notice in writing to
pay off the loan. The mortgagee without waiting to go into accounts with the appellant gave him notice on
10 January 1957, and on 8 March 1957 sold the farm at an auction to the respondent.
The appellant brought an action to the High Court against the mortgagee and the respondent claiming (i) a
declaration that the sale to the respondent was wrongful as no default notice was served on him, (ii) that
the document under which the mortgagee purported to have exercised the right of sale was not a legal
mortgage and that the sale of the farm to the respondent was void, (iii) for an order to set aside the sale
and (iv) £G300 damages against the mortgagee alone for wrongful sale of the farm to the respondent.
The trial judge dismissed the appellant’s action. He found that the document was a legal mortgage and
that the mortgagee complied with the terms of the mortgage deed before exercising his power of sale, and
therefore the farm was rightly sold. From this decision, the appellant appealed to the Supreme Court
which allowed the appeal by setting aside the trial court’s judgment and awarded him £G300 damages for
wrongful sale of the farm. The appellant did not serve the respondent with a notice of appeal.
After this appeal, the respondent instituted an action in the High Court against the appellant claiming
possession and damages for trespass in respect of the farm. The respondent contended that since he was
not served with notice of appeal, the appellant was estopped by the decision of the High Court in
challenging his title to the farm, (ii) that he was not bound by the decision of the Supreme Court which
allowed the appellant’s appeal on the ground that no notice of appeal had been served on him, and (iii)
that he was a bona fide purchaser for value without notice of any defect of the mortgagee’s title to the
farm. The appellant also counterclaimed.
The trial judge, in this subsequent action, entered judgment for the respondent. He held that the Supreme
Court judgment, reversing the decision of the trial court in the first action between the appellant on one
part and the mortgagee and the respondent on the other part, was not binding on the respondent as he had
no notice of the appeal, and therefore the order setting aside the judgment was not effective as against the
respondent. He further held that though the
judgment of the High Court had been set aside, it nevertheless, operated as res judicata against the
appellant and therefore the latter was estopped from disputing the respondent’s title to the farm. On
further appeal to the Supreme Court.
Held, allowing the appeal:
(1) a judgment may operate as an estoppel against a person though not a party to the proceedings in
which the judgment was delivered if he identified himself with one of the parties to the proceedings
on specific issues and judgment was entered against the party with whom he so identified himself,
he is estopped by conduct from relitigating the same issues against the successful party. Since the
respondent identified himself with the mortgagee on all the issues in the action in the High Court,
which was the decision which was reversed by the Supreme Court, he was estopped from bringing
an action on the same issues. Egyin v. Aye [1962] 2 G.L.R. 187, S.C. applied.
(2) Where a person’s title depends on the validity of a sale for the title, a general declaration that the
sale was void is a judgment in rem as to the status of the sale, and not a judgment in personam.
Since the sale of the farm upon which the respondent relied had been declared to be void he thereby
acquired no title under it which he could litigate.
(3) The interpretation to be placed on a decision of an appellate court allowing an appeal and setting
aside a judgment of a lower court which dismissed an action in which a plaintiff claimed certain
reliefs, was that the lower court wrongly dismissed the claims and that the plaintiff was entitled to
the reliefs sought for in the action.
(4) Where an appellate court allows an appeal from a decision of a lower court and awards damages to
the appellant whose claim had been dismissed by the lower court, the award of damages cannot
affect other reliefs sought for in the action dismissed by the lower court.
(5) Where a judgment has been vacated on appeal in respect of each of the issues raised, no res judicata
can be founded upon that judgment because it is non est.
(6) A person who purchased a mortgaged property can claim relief under the purchaser’s relief clause
appearing in the mortgage under which the sale was purported to have been made provided that he
had no notice of any irregularity relating to the sale, in such a case he is protected notwithstanding
that an event giving rise to the power of sale has not occurred, and even though at the time of the
sale, the mortgage has been paid off.
(7) A purchaser of a mortgaged property is not protected if he had notice actual or constructive of any
irregularity relating to the sale; consequently he is not protected if the exercise of the power
depends on a notice being given which in the circumstances cannot have been given. Jenkins v.
Jones (1860) 2 Giff. 99 at p. 108; Bailey v. Barnes [1894] 1 Ch. 25 at pp. 30 and 34, C.A.;
Parkinson v. Hanbury (1860) 1 Drew. & Sm. 143 and Lisk v. Barlatt (1938) 4 W.A.C.A. 56 cited.
(8) A clause in a mortgage deed or a statutory provision giving protection to a purchaser of a
mortgaged property does not give him an unimpeachable title to such property, it merely gives him
a rebuttable statutory defence to an action by a mortgagor to set aside a sale under his mortgage.
CASES REFERRED TO
(1) Amoah v. Manu [1962] 1 G.L.R. 218, S.C.
(2) Egyin v. Aye [1962] 2 G.L.R. 187, S.C.
(3) Jenkins v. Jones (1860) 2 Giff. 99; 29 L.J. Ch. 493; 2 L.T. 128.
(4) Bailey v. Barnes [1894] 1 Ch. 25; 63 L.J. Ch. 73; 69 L.T. 542, C.A.
(5) Parkinson v. Hanbury (1860) 1 Drew. & Sm. 143; 62 E.R. 332.
(6) Lisk v. Barlatt (1938) 4 W.A.C.A.. 56.
NATURE OF PROCEEDINGS
APPEAL from two rulings of Djabanor J. delivered in the High Court (unreported) wherein he ruled in
favour of the respondent in an action to recover possession of and damages for trespass to a farm which
he had bought at an auction sale.
COUNSEL
Appellant in person.
Victor Owusu for the respondent.
The mortgage further provided that if default of payment is made upon the expiration of the period the
mortgagee could exercise his
right of sale after “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.” The 1956-57 cocoa season closed on 28
February 1957, as by Gazette Notice No. 331 of 9 February 1957, which stated that “the current main
crop season will close on Thursday the 28th day of February 1957.” Without waiting for the season to end
and without going into accounts with the defendant to ascertain whether or not any amount was due and
owing to him, Kwaku Manu on 10 January 1957, purported to give notice to the defendant, and on 8
March 1957, sold the property at a public auction. The plaintiff was declared the purchaser at the sale.
After some correspondence had passed between the defendant on the one part and Kwaku Manu and the
plaintiff on the other, the defendant, on 3 August 1957, instituted an action against the plaintiff and
Kwaku Manu and in it, claimed:
“(a) A declaration that since the first defendant did not serve the plaintiff with default notice, the sale of
the plaintiff’s cocoa farm situated at a place commonly called Twemayeagya on or about 9 March
1957 by the first defendant is wrongful.
(b) A declaration that the document under which the first defendant purported to exercise power of sale is
not a legal deed of mortgage, and that the sale of the plaintiff’s cocoa farm under and by virtue of the
said document is wrongful.
(c) An order of the court setting aside the said sale of the plaintiff’s said cocoa farm.
(d) £G300 damages against the first defendant for the wrongful sale of the plaintiff’s said cocoa farm.”
It will be observed that claims (a), (b) and (c) were against Kwaku Manu and the plaintiff jointly, while
claim (d) was against Kwaku Manu only. In the statement of claim he filed in that case, the defendant
pleaded the facts he relied upon for his contention that the sale was void and passed no title in the land to
the plaintiff. These include a plea that the right of sale had not accrued under the mortgage to Kwaku
Manu, and that the notice he, Kwaku Manu, purported to give was illegal. The relevant paragraphs of his
statement of claim were:
“(2) By document made between the plaintiff and the first defendant in June 1956, the plaintiff as
sub-broker offered to the first defendant as factor, one cocoa farm situated
Kwaku Manu and the plaintiff filed one joint statement of defence; in it the plaintiff identified himself in
every respect with Kwaku Manu, and did not raise any separate defence, not even the defence of a bona
fide purchaser for value without notice which was open to him. The following paragraphs in their said
defence are significant.
“(1) Defendants deny paragraphs (2), (3), (4) and (5) of the plaintiff’s statement of claim . . .
By that defence the plaintiff positively averred that he was seised with knowledge of the prerequisites for
the vesting of the right of sale in Kwaku Manu under the deed, that he was aware of all the steps taken by
Kwaku Manu in that behalf, and therefore satisfied himself that the exercise of the power was proper
before he made the purchase. Thus the issues for trial agreed upon by all parties are:
“(1) Whether or not the document under which the first defendant exercised power of sale (and caused the
plaintiff’s cocoa farm to be sold) is a legal deed of mortgage.
(2) Whether or not the plaintiff was served with any default notice or notice of demand.
(3) Whether or not accounts were settled between the plaintiff and the first defendant at the close of the
1956-57 cocoa season, and whether or not - by reason of the terms of the document - the first
defendant should have first instituted court proceedings for any amount due - before proceeding with
the sale of the plaintiff’s farm.
(4) Whether or not the plaintiff is entitled to the remedy he seeks.”
The case was tried in the High Court by H. Christian Esq., Commissioner of Assize and Civil Pleas, as he
then was, who on 9 April 1960, dismissed the defendant’s claim. In the course of his judgment the learned
commissioner said:
From that judgment the defendant appealed to this court, but did not serve notice of his appeal on the
plaintiff, and described him as non-respondent. He was successful in his appeal. In the course of the
judgment sub nom. Amoah v. Manu1 the court said that the notice which Kwaku Manu purported to give
to the defendant,
“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 place . . . It follows that the sale pursuant to that notice dated the 10 January, 1957, must be and is
hereby declared to be illegal.”
The court therefore allowed the appeal and entered “judgment for the plaintiff awarding him £G300
damages for the wrongful sale of his farm . . .”2 That judgment of the court was delivered on 2 April
1962, and it would appear that the defendant who had in the meantime been dispossessed of the farm by
the plaintiff resumed his occupation, whereupon the plaintiff instituted the present action against him and
claimed:
“(a) possession of the cocoa farm described and particularised in the schedule hereto, and
(b) damages for trespass thereto by defendant at the rate of £G125 per cocoa season from May 1962 to
date of judgment or date of recovery of possession of the said farm by plaintiff whichever shall be
earlier.”
The learned trial judge having heard arguments on issues (2), (3) and (4) being issues of law, ruled on
April 22, that:
(i) the judgment of this court delivered on 2 April 1962,3 was not binding upon the plaintiff since he
was not made a respondent to the appeal,
(ii) the order of this court setting aside the judgment of Commissioner Christian was not effective as
against the plaintiff, and that the said judgment, though set aside was still in force and operated as
res judicata against the defendant, and that the defendant was estopped from defending the
plaintiff’s claim in the present suit, and
(iii) the defendant having been awarded £G300 damages by this court against Kwaku Manu for
wrongful sale, was not entitled to question the sale even though in the previous suit this court
declared the sale illegal.
Upon these grounds, the learned judge did not find it necessary to try issue (1), i.e. whether the plaintiff is
a bona fide purchaser for value. Indeed whichever way issues (2), (3) and (4) are decided it would not be
necessary to deal with that issue. In his concluding order the learned judge awarded the plaintiff twenty
guineas general damages.
The defendant was not represented in this court by counsel; he rested his submissions on the grounds of
appeal filed on his behalf by counsel who appeared for him in the court below, but who, by reason of his
present appointment, could not appear to argue the appeal for him. The most important of the grounds of
appeal are:
(a) On a proper construction of the judgments of 5 April 1960 and 2 April 1962 the plaintiff herein is
estopped from prosecuting his claim and the learned judge erred in holding the contrary.
(b) The plaintiff has acquired no good title to the farm, in view of the Supreme Court’s judgment of 2
April 1962 and
(c) The judge erred in holding that the Supreme Court’s judgment of 2 April 1962 does not bind the
plaintiff herein.
In making his ruling against the defendant on issues (2), (3) and (4) in the case, the learned trial judge
completely overlooked the most important fact that in the first suit, the plaintiff identified himself in
every respect with Kwaku Manu, that one and only one set of issues was joined between the defendant on
the one hand, and the plaintiff and Kwaku Manu on the other. There are cases in which judgment
between two parties can operate as an estoppel against a person who was not party to the proceedings in
which the judgment was delivered. The principle in such a case is a combination of an estoppel by record
and an estoppel by conduct. This principle is formulated in a judgment of this court in Egyin v. Aye,4 as
follows: “If A. identifies himself with B. in a suit against C. on specific issues and B. loses to C., then A.
is estopped by conduct from re-litigating the same issues against the successful party C.”
In the earlier suit, as already pointed out, the claim that the sale was void of effect and passed no title in
the farm was made against Kwaku Manu jointly with the plaintiff; on that issue the plaintiff could stand
or fall with Kwaku Manu. The only claim in which Kwaku Manu stood alone is the claim for £G300
damages for wrongful sale. The court set aside the judgment of Commissioner Christian on those issues
without making reservation in respect of any part of that judgment. Therefore the whole judgment is
vacated and is of no effect as far as any of those issues are concerned.
Again, the plaintiff depended upon the validity of the sale of his title; a general declaration that a sale is
void is a judgment in rem as to the status of the sale, and not a judgment in personam. In the judgment of
this court relied upon by the parties, this court used a term of art, the sale it said “is hereby declared to be
illegal.”5 Anything which is illegal is void of effect therefore the sale relied upon by the plaintiff being
illegal is void of effect, consequently the plaintiff acquired no title under it which he can litigate.
Again, the final order made by this court in the former case, Amoah v. Manu,6 is significant; it set aside
the judgment of the trial court, and entered judgment for the plaintiff and awarded him £G300 damages
for the wrongful sale. The defendant herein had claimed four reliefs including £G300 damages and the
trial court had dismissed the claim in respect of each of those four reliefs. The only proper interpretation
of the judgment which set aside that judgment of the commissioner is that the claims were wrongly
dismissed, and that the defendant is entitled to each of those four reliefs; the award of the damages of
£G300 claimed cannot affect the generality of the effect of the setting aside of the commissioner’s
judgment in respect of the other reliefs. The whole of the commissioner’s judgment having been thus
vacated in respect of each of the issues raised, no res judicata can be founded upon that judgment which is
non est.
It follows that the learned judge erred in resolving the second, third and fourth issues joined between the
parties in favour of the plaintiff.
And now to the first issue, i.e. whether the plaintiff can claim relief under the purchaser’s protection
clause appearing in the mortgage under which the sale was purported to have been made. This express
protection which is a reproduction of the statutory protection given by the Powers of Trustees and
Mortgagees Act, 1860,7 s. 13, re-enacted in the Conveyancing and Law of Property Act, 1881,8 s. 21, as
amended by the Conveyancing Act, 1911,9 s. 5(1), merely exempts a purchaser under a mortgage from
any duty to make inquiries; it does not make the sale unimpeachable and thereby the title of the purchaser
unassailable. The law on the point is that:
“provided that he has no notice of any irregularity, he is protected notwithstanding that an event giving rise
to the power of sale has not occurred, and even though at the time of the sale, the mortgage has been paid off.
But he is not protected if he has notice, actual or constructive, of the irregularity; consequently he is not
protected if the exercise of the power depends on a notice being given which in the circumstances cannot
have been given . . .”
See Halsbury’s Laws of England (2nd ed.), Vol. 23, p. 441, para. 649; see also Jenkins v. Jones,10 Bailey
v. Barnes,11 Parkinson v. Hanbury12 and Lisk v. Barlatt13. It means that that clause or statutory
provision does not give unimpeachable title to a purchaser under a mortgage; it merely provides him with
a statutory defence to an action by a mortgagor to set aside a sale under his mortgage; that defence is
rebuttable.
Applying that principle of law to the present case, we find, as was pointed out earlier, that in the defence
filed jointly by Kwaku Manu and the plaintiff, the plaintiff impliedly admitted that he was seised of all
the circumstances exactly as Kwaku Manu as to the time when notice should be given, i.e. at the close of
the 1956-57 cocoa season, and he must be deemed to have known from the Gazette Notice that the season
had not closed at the time when Kwaku Manu purported to give his notice, and further that the season not
having closed at the date of the said notice, no accounts could have been
gone into to determine whether or not the defendant was owing Kwaku Manu the mortgagee, to warrant
notice of default being given.
Again, in view of the defence filed in the former suit, the plaintiff is estopped from now pleading that he
is a bona fide purchaser for value without notice of the irregularities and the illegalities.
It follows that the learned judge erred in giving judgment for the plaintiff on his claim against the
defendant, and in dismissing the defendant’s counterclaim.
In the result, the appeal is allowed, the judgment of the court below is set aside including the order as to
costs, any costs paid to be refunded; for that judgment the following is substituted:
(a) The plaintiff’s claim is dismissed and judgment entered thereon for the defendant,
(b) there will be judgment for the defendant on his counterclaim against the plaintiff for:
(i) a declaration of his title to the land in dispute,
(ii) an order decreeing the sale null and void,
(iii) an order for recovery of possession,
(iv) mesne profits assessed at £G200.
The appellant will have his costs in this court fixed at £G78 9s. 5d. and his costs in the court below agreed
at 50 guineas.
DECISION
Appeal allowed.
K. T.