Redefining the Grounds for Entry of Conditional Appearance; The Case of Nii Amanor Dodoo (Suing as Receiver of the Beige Bank Ltd) & Another v. Michael Nyinaku & 12 Others

To the practitioners of our courts, academics and students of civil procedure, the 2019 ruling of the High Court of Ghana, in the case of Nii Amanor-Dodoo and The Beige Bank v. Michael Nyinaku & 12 Others², presents genuine thoughts on what constitutes the true position of the Ghanaian law on Conditional appearance. This article discusses the ruling of the High Court and the Court’s test on how such applications to move the court to strike out a writ must be treated. The discussion is presented by tracing the historical antecedents and essence of appearance as a procedural step in order to guide the analysis of the Court’s proposition.

The 1st Plaintiff, Nii Amanor Dodoo, suing as receiver of The Beige Bank Limited issued a writ of summons against the Defendants. The Beige Bank Limited was, subsequent to an application for joinder by the Bank, joined as a 2nd Plaintiff to the action. The 1st Defendant was the Chief Executive Officer of the 2nd Plaintiff. The other 12 Defendants were companies incorporated under the law of Ghana

The Plaintiffs alleged that they had identified a number of transactions executed by the 1st Defendant for his and the benefit of the other Defendants. These transactions, the Plaintiffs considered unlawful.

The Plaintiffs, among others, sought a declaration that the transactions identified in the Statement of Claim and executed by the Defendants were unlawful; an order for the recovery of specific sums, jointly and severally from the Defendants; an order for the Defendants to account and refund to the Plaintiffs any profits resulting from specific transactions; and an order for the tracing of assets belonging to the 2nd Plaintiff and within the possession and control of the Defendants.

Upon service of the Writ on the Defendants, they caused to be entered a conditional appearance and subsequently brought of an application invoking the original jurisdiction³ of the High Court to strike out the suit. The grounds for the application was that the writ was a nullity, since it was commenced by a person without the requisite capacity. To the Applicants, once the 1st Plaintiff lacked capacity at the time of commencement of the suit, the court ought to hold that no suit was commenced at all. Thus, the subsequent joinder of the 2nd Plaintiff Bank was also a nullity; since you cannot put something on nothing and expect it to stand.⁴

The Applicants contended that the question of capacity is not necessarily a substantive defence which must be argued on the merits. They argued further that the question of capacity is a question of law and can be raised any time at all by any of the parties.

The Respondents raised a preliminary objection in opposing the application. They argued, that pursuant to Order 9 rule 8 of C.I 47⁵, a defendant who enters conditional appearance must limit his application to the reliefs specified in the rule. They submitted, therefore, that to the extent that the application was to strike out the suit, it was incompetent; since it does not form part of the reliefs captured under the rules of Court. Further, the Respondents argued, that the question of capacity was not a matter of irregularity or jurisdiction, but a substantive defence which ought to be pleaded and evidence led at trial. They submitted, in any event, that the 1st Plaintiff having assumed office as a receiver of the 2nd Plaintiff, he had capacity to sue in his own name. The 1st Plaintiff argued that having assumed the rights and powers of the members of the 2nd Plaintiff, he could sue in this own name by operation of law.

The High Court, Her Ladyship Justice Jennifer Abena Dadzie coram, held, rejecting the Respondents’ argument, that on the preliminary issue of conditional appearance, the grounds upon which an application to strike out a suit, upon entry of conditional appearance are not exhaustive.

Her Ladyship further stated that the “application can be premised on any ground so far as that ground is sustainable in the eyes of the court.” Having cited the decision of Amissah-Abadoo v. Abadoo⁶, Her Ladyship continued thus: “What is set out in Order 9 rule 8 of C.I. 47 then are not grounds as deemed by counsel but applications/reliefs. These applications as I have already stated can be grounded on any reason.”

The Court then sought to lay a broad and expansive test upon which applications brought pursuant to entry of conditional appearance must be treated. Call it the sustainability test. Her Ladyship stated: “The question of whether that reason is sustainable is then left to the court to decide. If it is, the result will be a grant of the application as laid out, otherwise, it fails and the case proceeds on its normal course.”

Having earlier opined that “what is set out in Order 9 rule 8 of C.I. 47 are not grounds as deemed by counsel but applications/reliefs”, Her Ladyship proceeds, in effect, to overrule the decision in the Amissah-Abadoo case by suggesting: “It is my considered opinion that the three (3) grounds that the court in Amissah-Abadoo v. Abadoo proceeded to state, that is, the “ground of irregularity of the writ or the service of it or to deny jurisdiction” are not the only grounds that could be canvassed when bringing an application to set aside a writ of summons.”

On the question of capacity, the court held that the Respondents lacked the capacity to bring their action. Her Ladyship held thus: “A lack of capacity to initiate proceedings would therefore render the writ defective. This, the courts have held to have the effect of invalidating the writ and nullifying any proceedings ensuing therefrom.”

The main focus of this article is to ascertain whether the law on conditional appearance, as has been known and taught to students of civil procedure, admits of the broad and expansive test laid by Her Ladyship in her judgment.

The Black’s Law Dictionary⁷ defines appearance as the coming into court as a party or interested person, or as a lawyer on behalf of a party or interested person, especially, a defendant’s act of taking part in a lawsuit, whether by formally participating in it or by an answer, demurer, or motion, or by taking post-judgment steps in the lawsuit in either the trial court or an appellate court.

A brief historical overview on appearance would give perspective to the discussion on conditional appearance. According to Shipman, in the Handbook of Common Law Pleadings⁸ “the English Courts did not, until modern times, claim jurisdiction over the person of the defendant merely by service of summons upon him.

It was deemed necessary to resort to further process by attachment of his property and arrest of his person to compel ‘appearance’, which is not mere presence in court, but some act by which a person who is sued submits himself to the authority and jurisdiction of the court”.

As pointed out by Odgers⁹, in the early days, a defendant who wished to contest an action had to physically appear before the court, and submit to or protest against its jurisdiction, and state publicly that he intended to defend the action and on what grounds. In the course of time, physical appearance as a method of responding to the service of proceedings was replaced by the formal procedure of “entry of appearance”. In England, the procedure of entry of appearance has been replaced by “acknowledgement of service”¹⁰. Under the new procedure, a defendant who wishes to defend an action must complete the acknowledgement of service, which accompanies the writ served on him, and return it within the prescribed period to the court office out of which the writ was issued. If the defendant wishes to object to any irregularity in the writ, or in the issue or service thereof, or if he wishes to dispute the jurisdiction of the court, he should complete and return the acknowledgment of service in the normal way and then apply to the cour within 14 days of the acknowledgement for an appropriate order. In modern times, however, the term appearance is used particularly to signify or designate the overt act by which one against whom suit has been commenced submits himself to the court’s jurisdiction, although, in a broader sense, it embraces the act of either plaintiff or defendant in coming into court. An appearance may be expressly made by formal written or oral declaration, or record entry, or it may be implied from some act done with the intention of appearing and submitting to the court’s jurisdiction¹¹.

As noted above, the essence of entry of appearance or as is known in England, acknowledgment of service, is no different from what pertains in Ghana. Indeed, as a common law country, these procedural rules are simply an adoption and adaption of what pertains in England.

The Irish authors of McCann FitzGerald in a briefing¹² described the essence of appearance as follows: An appearance is a standard form entered by the defendant in person or through his lawyer. In it, the defendant acknowledges two things. The first is that the plaintiff’s originating document has been served on him, in accordance with the relevant rules of service. Second, that the court properly has jurisdiction over him. Where the defendant disputes either of the two matters stated, he may enter a conditional appearance, signalling his doubt about whether the plaintiff has properly brought him before the court. If he does, the defendant must promptly apply to the court to decide that doubt, so that the case can move on or be struck out.¹³

The Rt. Hon. Lord Justice Maurice Kay, notes in Blackstone’s Civil Practice¹⁴, that acknowledgment of service may be filed in cases where a) the defendant is not able to file a defence within 14days after service of the particulars of claim; or b) the defendant wishes to dispute the court’s jurisdiction. He cautions that where a defendant signs an acknowledgment without indicating an intention to challenge jurisdiction, a party waives any defects in service. For this, he cites the authority of Brooks v. A.H. Brooks and Co.¹⁵

The Common law jurisdictions appear to converge in procedure that a defendant who intends to challenge either the issuance of the writ on him, service of the writ thereof or a contest to jurisdiction, ought to enter conditional appear or appearance under protest. Thus, the scope appears limited and not based ‘any other reason which may be sustainable in the eyes of the court’ as contended by the Court in the Beige Bank case under consideration

The law on conditional appearance in Ghana is not markedly different from the other common law jurisdictions discussed above. For starters, the procedure by which a party commences an action before the High Court in Ghana is regulated by the High Court (Civil Procedure) Rules, 2004, (C.I. 47). The C.I.47 also applies to the civil proceedings before the Circuit Court, mutatis mutandis. A party vested with a cause of action is required to adhere to the provisions of the rules of court.

The writ of summons in Ghana, is issued under the command of the Chief Justice to the defendant to, within eight days after service of the writ on him, cause an appearance to be entered; default of which judgment may entered against him without further notice to him.¹⁶ Order 9 rule 7 provides that a defendant may file a conditional appearance. The rules require a defendant who enters conditional appearance to bring an application to set aside the writ within 14days after, filing the appearance. The application may seek the following orders. To:

The basis upon which application may be brought upon entry of conditional appearance has received several judicial pronouncement in Ghana. In the case of Republic v. High Court, Denu; Ex parte Avadali IV¹⁸, Adade JSC quotes the note on conditional appearance in the White Book (1959) at page 566 of the judgment thus: “The term conditional appearance means an appearance in qualified terms, reserving to the appearing defendant the right to apply to the court to set aside the writ, or service thereof, for an alleged informality or irregularity which renders either the writ or service invalid or for lack of jurisdiction…”.

Earlier, the High Court, per Wiredu J. in the case of Amissah-Abadoo v. Abadoo¹⁹at holding 2 of the report stated the law on the grounds for the entry of conditional appearance thus: “A defendant might enter a conditional appearance where he intended to have the writ or the service of the writ set aside on the ground of irregularity in the writ or the service of it or to deny jurisdiction. Irregularity here included the irregularity in the issue or service of the writ or in the form of the writ. The defendant’s application did not attack the plaintiff’s writ on any of the above, grounds. Her sole complaint that the writ did not disclose any reasonable cause of action was not among the grounds which justified her entering a conditional appearance and consequently the conditional appearance would be treated as an unconditional appearance which would entitle her to present her application under Order 25, r. 4 of L.N. 140A.”

The question of grounds upon which an application may be brought upon the entry of conditional appearance came before Commercial Division of the High Court coram His Lordship Eric Kyei Baffour in the case of West Blue Ghana Ltd v. Ghana Link Network Services Ltd and 3 Others²⁰. The Defendants/Applicants in that case applied to strike out the suit of the Plaintiff/Respondent on the grounds that it was scandalous, frivolous and vexatious or was otherwise an abuse of the process of the Court pursuant to Oder 11 rule 18 (1) (b) and (d).

The application was sequel to an entry of conditional appearance. The respondent took a preliminary objection on the grounds that the application was not properly founded on any of the grounds upon which such an application may be brought upon entry of conditional appearance as was stated in the Supreme Court case of of Republic v. High Court, Denu; Ex parte Avadali IV supra. The respondent contended, that it was not a carte blanche for a defendant who had entered a conditional appearance to move the court to have the writ set aside because he had a legal defence, even if unimpeachable, to the action. His Lordship however, waived the palpable irregularity on the part of the Applicants and determined the application on its “merits”.

This author is of the view that His Lordship’s waiver, well-accords with the stated objectives of the C.I. 47. He renders it exquisitely at page 3 of the judgment thus: “It is true that a correct appreciation of the Rules of Court is that the spirit that animates its application is for the court to strive so as to achieve speedy and effective justice, avoid delays and needless expense and ensure that matters in dispute are completely, effectively and finally determined and multiplicity of suits or proceedings is averted.”

First, the Court takes the position that an application to move the court to dismiss a suit upon entry of conditional appearance, admits of a broad, expansive grounds which must be entertained and determined so long as it is sustainable. The Court stated thus: the “application can be premised on any ground so far as that ground is sustainable in the eyes of the court.”

The Court continued: “What is set out in Order 9 rule 8 of C.I. 47 then are not grounds as deemed by counsel but applications/reliefs. These applications as I have already stated can be grounded on any reason.”

The Court, however, did not provide any authority for this attempted re-statement of the Ghanaian law on conditional appearance. The statement is a roll-back of all the gains of settled authority made by the Ghanaian courts, including the Supreme Court on the grounds upon which a defendant may move the court to dismiss a plaintiff’s suit upon entry of conditional appearance. By stating that the application may be based on any reason, the High Court, attempts to overrule a Supreme Court decision in the case of Republic v. High Court, Accra; Ex parte Aryeetey (Ankrah Interested Party)²¹. Holding 3 of the decision reproduced below in detail for analysis:

“A conditional appearance was to enable a defendant who intended to object to the issue or service of a writ or notice of a writ on him, or the jurisdiction of the court, to apply to the court to set aside the writ or notice of the writ or the service thereof on him. Such an application might encompass any irregularity or defect in the issue or service of the writ, or notice of the writ. Thus, it was not permissible for a defendant who had entered a conditional appearance to move the court to have the writ set aside because he had a legal defence, even if unimpeachable, to the action. Accordingly, such an application was not available to the respondent who after entering a conditional appearance to the applicant’s writ at the High Court sought to rely on a plea of res judicata since that plea, to be successful, had to satisfy certain requirements which could only be revealed through evidence. Moreover, the respondent had no right to apply to set the applicant’s writ aside because he had a good defence to the action.”

If the High Court’s broad and expansionist view that any reason could be offered to move the Court upon entry of conditional appearance were to be followed, it would mean that:

It is the view of this author, that having regard to all historical overview presented and the authorities on the subject as discussed above, the High Court’s attempt to restate the law on conditional appearance is not maintainable. The essence of entering appearance as noted above, is not to immediately call the courts to halt the case in its tracks. Rather, it is to acknowledge receipt of the writ. Such acknowledgment may be regular or it may come under protest. The basis for such entry of conditional appearance have not been set at large in law.

It is particularly so, when no authority was provided for the court’s far-reaching proposition. Thankfully, the decision of a Court of coordinate jurisdiction such as the High Court, is not binding on other High Courts. The author invites the Supreme Court, to, at the earliest opportunity restate the Ghanaian position of the law on conditional appearance so that students of Civil procedure are not left in doubt as to the how to approach exam questions. In the absence of such earliest opportunity, it has to be stated for emphasis, that the case of Republic v. High Court, Accra; Ex parte Aryeetey and Republic v. High Court, Denu; Ex parte Avadali IV (supra) are the most authoritative pronouncements on the subject of conditional appearance in Ghana.

Second, though the focus of this article is mainly to assess the Court’s decision on conditional appearance, the author notes that the High Court did not make a definitive pronouncement on Counsel for the Applicant’s contention that the issue of capacity was a question of law. At page 3 of the ruling, the court presented the case of the Applicants thus: “Relying on the case of Akrong v Bulley [1965] GLR 469-478 and Standard Bank Offshore Trust Company Ltd v National Investment Bank & 2 Ors (Civil Appeal No. J4/63/2016; delivered 21st June, 2017), and other writings, counsel submits that the question of capacity is not necessarily a substantive defence which should be argued on the merits. Rather, counsel contends that the issue of capacity could be raised as a question of law anytime at all by any of the parties. Thus, capacity must be found to be existent before the issuance of the writ else, the writ is a nullity”.

The above proposition is frontally in conflict with the holding in Republic v. High Court, Accra; Ex parte Aryeetey. Having cited the dictum of Verity Ag. P in the case of Sokpui II v. Agbozo III on the catastrophic effect lack of capacity can have on the fortunes of a case, the Supreme Court then went ahead to state as follows:

“The above dictum, in our view, includes the submission that whether a person who sued in a representative capacity indeed has the capacity he claims to have or not, is a question of fact and if challenged, he must prove same to avoid his suit being dismissed since it is analogous, in our view, to taking an action against a non-existent defendant. But, if the representative capacity he claims is not challenged, naturally a plaintiff assumes no such burden”.

Even if the capacity in which the Plaintiff sues was not disclosed, the cardinal test ought to have been the whether it is just to allow the party to amend the suit in order to avoid cost and multiplicity of suits. Order 16 rule 5 (4) of C.I. 47 provides that an amendment to alter the capacity in which a party sues may be allowed… if the new capacity is one which that party had at the date of the commencement of the proceedings or has since acquired. Sub rule 5 of Order 15 rule 5 also provides that “an amendment may be allowed… notwithstanding that the effect of the amendment will be to add or substitute a new cause of action, if the new cause of action arises out of the same facts or substantially the same facts as the cause of action in respect of which relief has already been claimed in the action by the party applying for leave to make the amendment.

The combined effect of Order 16 rule 5(5) and (6) is that the Courts must hasten slowly in taking issues of capacity as one of the grounds upon which conditional appearance may be entered.

As cautioned earlier, however, the issue of capacity is not the focus of this article and a more detailed paper on the subject may be desirable. Except to add, that in the instant case, the Court treats the question of capacity as one of law and hence affecting the issuance of the writ.

This author holds the view that the overall intendment of the C.I. 47 was not realized in the instant case since the issues raised in the ruling on the issue of capacity could have been cured by an amendment and not striking out of the suit.

This article has sought to explain the Ghanaian position on the law on conditional appearance as a procedure available in civil proceedings. As can be seen from the above, the High Court’s attempt to expand the scope and meaning of “grounds’ upon which an applicant may move the court to set aside a writ are not maintainable in law. The Court’s proposition attempts to overrule the decision of the Supreme Court and must not be followed by even the Circuit court in its modified application of the C.I. 47. As an ancillary matter, the author notes, if the Ghanaian courts adverted its mind to the effect of Order 16 rule 5(5) and (6), they would be slow to treating the issue of capacity as one upon which conditional appearance may be competently entered. Rather, a defendant must enter ‘normal’ appearance. In filing his statement of defence, the defendant may raise the issue of capacity and may elect to bring a separate application for the court to determine that sole question before the case may proceed. In such case, where evidence is required to be adduced, it may then be put before the court for such a determination.

By way of statutory option, the Rules of Court Committee may consider the New Zealand option of providing a ticking box of options on the standard form a defendant may return upon service on him of the writ. This may limit the abuse of entering conditional appearance for any reason to be determined by the Courts.