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The High Court, Accra, in the case of GREAT IMPERIAL TRANSPORT LTD v. MOLE TRANSPORT SERVICES & ANOR [TLP-HC-2026-27] has dismissed an application to set aside a default judgment obtained by a haulage company against its judgment debtors, holding that a party who enters conditional appearance, instructs counsel, and takes steps in a suit cannot later turn around, years after judgment, to claim it was never properly served or sued under the wrong name.
The ruling, delivered by Justice Klorkor Okai-Mills, found that any irregularity in how the writ was served had been waived once the defendants participated in the proceedings without objection, and that in any event the company had been properly identified as the true party sued, despite a mix-up over its registered name.
Background
Great Imperial Transport Ltd sued Mole Transport Services and its director, Mesuna Osman, over a commercial dispute, filing its writ and statement of claim in March 2023. The writ was served on both defendants through a woman identified in the affidavit of service as "Madam Milicent," described as the company's secretary. Counsel for the defendants, Kwabena Owusu-Mensah, entered conditional appearance shortly afterwards and later appeared in court to seek an adjournment so the defendants could file a defence and explore settlement. When no defence was filed, the court entered judgment in default against the defendants on 20th November, 2023.
It was only after the plaintiff filed an entry of judgment and moved to execute against the defendants' property, roughly two years later, that new counsel appeared for the defendants and applied to set aside the judgment. The application argued that Madam Milicent was not known to the defendants as their secretary, that personal service was required on the 2nd defendant, and that the 1st defendant had in fact been sued under the wrong corporate name, "Mole Transport Services" instead of its registered name, "Mole Projects and Machinery Limited."
In a supplementary affidavit, the 2nd defendant, Mesuna Osman, offered an account in which an old friend, said to be a non-practising lawyer and pastor, happened to be at the company's office when the writ was delivered and, without Osman's knowledge, passed it to a lawyer who went on to enter appearance and represent the defendants for months, all, Osman claimed, without his awareness until the entry of judgment surfaced.
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Applicants' Arguments
Counsel for the applicants argued that service on the 2nd defendant through Madam Milicent was improper, since the rules require personal service on an individual, and that this defect meant the court never properly acquired jurisdiction to hear the matter. He further argued that the writ had been issued against a non-existent legal entity, since "Mole Transport Services" was not the company's registered name, relying on authorities holding that a writ issued against a non-existent party is a nullity.
Respondent's Arguments
Counsel for the plaintiff/respondent argued that the application was without merit, pointing to court records showing that the defendants' first lawyer had entered conditional appearance and later appeared in court seeking time to settle the matter, conduct inconsistent with any claim of ignorance of the suit.
The respondent produced invoices and bank records showing that the defendants had transacted business under the name "Mole Transport Services" for years and made payments to the plaintiff under that name, arguing the defendants could not credibly claim not to recognise the entity sued.
Court's Findings
The Court held that service through Madam Milicent, described as the company's secretary, satisfied the requirements for service on a corporate body under both Order 7 of the High Court (Civil Procedure) Rules and section 291 of the Companies Act, 2019 (Act 992), since it was left at the company's premises with someone positioned to bring it to the company's attention. The Court found the bare denial that Madam Milicent worked as a secretary unpersuasive, particularly where the defendants had gone on to instruct counsel who entered appearance in the matter.
On the account that a friend of the 2nd defendant had intercepted the writ and unilaterally engaged a lawyer without his knowledge, the Court was unsparing, describing the explanation as an implausible story advanced only after the plaintiff's opposing affidavit exposed that the defendants had, in fact, been represented throughout by competent counsel who appeared in court and sought concessions on their behalf.
The Court held at page 15 of its ruling that, "For the record, this application to set aside the judgment was made after the Plaintiff filed the entry of judgment and same was brought to the attention of the Defendants. Till the entry of judgment, as already stated, the Defendants, as far as the Plaintiff/Respondents and the Court were aware, were being represented by competent counsel. The explanation subsequently filed by the Applicant seeking to walk back the appearance of counsel on their behalf is totally untenable and frankly an ananse story which seeks to pull the wool over the eyes of the court, but thankfully, the court is ever wide eyed."
Turning to the question of waiver, the Court held that even assuming some irregularity in service, Order 81 Rule 2 of the High Court Rules required any application to set aside proceedings for irregularity to be made within a reasonable time and before the party had taken any fresh step with knowledge of the irregularity. Since the defendants had entered conditional appearance, sought an adjournment, and participated in proceedings for months before judgment, and only raised the service objection roughly two years later after execution had begun, the Court found they had waived their right to complain of any defect in service.
On the naming issue, the Court found that the plaintiff had consistently dealt with and invoiced the defendants under the name "Mole Transport Services," and that the defendants had made payments under that same name, making it implausible that they had been sued under a name unconnected to them. The Court noted that the writ had, in any event, already been amended by court order to reflect the company's preferred name, rendering the naming objection moot.
Decision
The Court held that the defendants, having entered conditional appearance and taken active steps in the suit, could not belatedly challenge the validity of service, and that no irregularity existed in respect of service on the 1st defendant in any case. The application to set aside the judgment of 20th November, 2023 was accordingly dismissed.
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