Court Rules Against Yeboah Afihene MD
The Kumasi High Court, Commercial Division, has ruled against the Managing Director claim of a person who initiated a contempt application on behalf of Yeboah Afihene Industries Ltd., holding that he failed to prove that he was still the company’s Managing Director.
The court, presided over by Justice Elfreda Amy Dankyi, consequently upheld a preliminary legal objection raised by the respondents and threw out the contempt application.
The ruling, in Suit No. MISC/06/2026, was delivered at Commercial Court 1, Kumasi, after lawyers for the respondents challenged the capacity of the applicant to institute the proceedings.
The respondents argued that the deponent who represented the applicant was no longer the Managing Director of the company, having allegedly been removed from the position through a resolution passed by members of the company.
The applicant, however, maintained that he remained the Managing Director and relied on a November 2018 court judgment which had dealt with issues concerning the directorship, membership, shareholding structure and control of corporate assets of the company.
He further argued that even if he was not the Managing Director, he remained a director and could bring proceedings in the name of the company.
But Justice Dankyi rejected the argument, stressing that the applicant bore the responsibility of proving his capacity to initiate the proceedings.
The court noted that the respondents had attached minutes of the company indicating that the applicant had been removed as Managing Director.
In a further attempt to establish his position, the applicant filed a supplementary affidavit with an exhibit.
However, the judge pointed out that the exhibit contained a statement that “the managing director of the Applicant is not known,” which, she said, tended to contradict his own assertion that he was the Managing Director.
Justice Dankyi therefore held that the applicant had failed to produce documentary or other credible evidence proving that he was currently the Managing Director.
The court also relied on provisions of the Companies Act, 2019 (Act 992), particularly Sections 148(1) and 200(2), concerning the authority required for a company to institute proceedings and the ability of directors or officers to bind a company.
The judge explained that a company was a legal person separate and distinct from its members and that an individual director could not simply assume the authority to institute proceedings in the company’s name without the requisite authorisation.
The court cited several authorities, including Manu v. Nsiah, Asante-Appiah v. Amponsah Alias Mansa, Fosua & Adu-Poku v. Dufie (Deceased) & Adu Poku-Mensah, T.K. Serbeh & Co. Ltd v. Mensah and Akrong v. Bulley.
Justice Dankyi also dismissed the applicant’s contention that the November 2018 judgment deprived the present court of jurisdiction to determine the capacity objection.
She noted that the earlier judgment dealt with issues relating to directorship, membership, shareholding and control of corporate assets, while the present matter concerned an alleged contempt by the respondents.
The judge consequently held that the applicant had no locus standi to bring the contempt application.
“I hold that the Applicant has no locus in this matter and I will not bother to go into the merits of the contempt application,” Justice Dankyi ruled.
The preliminary legal objection was accordingly upheld, bringing the contempt proceedings to an end without the court determining the substantive contempt allegations.
The court further awarded GH¢10,000 costs each in favour of the respondents.
Kwamina Mensah Esq. represented the applicant, while Mathew Appiah Esq. appeared for the first and second respondents and Bright Gyamfi Esq. represented the third respondent.
