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JULIUS NOI TETTEYFIO OF ASAMANKESE AND ANOTHER
V.
DANIEL CHRISTOPHER AWUKU
THE WEST AFRICAN COURT OF APPEAL, HOLDEN AT ACCRA, GOLD COAST
25TH DAY OF MARCH, 1955
W.A.C.A. NO. 54 of 1954
2PLR/1955/65 (WACA)
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OTHER CITATION(S)
2PLR/1955/65 (WACA)
(1955) XIV WACA PP. 723-725
LEX (1955) – XIV WACA 723-725
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BEFORE THEIR LORDSHIPS:
FOSTER-SUTTON, P.
COUSSEY, J.A.
HEARNE, J.A.
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BETWEEN:
1. JULIUS NOI TETTEYFIO OF ASAMANKESE
2. MARBLER OKANTEY OF ACCRA – Appellants
AND
DANIEL CHRISTOPHER AWUKU – Respondent
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ORIGINATING COURT(S)
Appeal from a judgment of Korsah, J., by the defendants No. (2) and No. (3) only, they now being named as appellants No. 1 and No. 2
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REPRESENTATION
C. C. Lokko, with E. O. Lamptey — for the Appellants
Amaa Ollennu, with Akufo Addo — for the Respondent
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ISSUE(S) FROM THE CAUSE(S) OF ACTION
REAL ESTATE AND PROPERTY LAW:- Mortgage — Subsequent sale by mortgagor and order for specific performance and conveyance — Sale by mortgagee — Neither purchaser aware of mortgagor’s fraud — Position as between purchaser from mortgagee and purchaser from mortgagor
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CASE SUMMARY
The owner first mortgaged the property to N.O. by deed; later he sold it to the respondent who sued him for specific performance and obtained judgment and a conveyance. After that first mortgage to N.O., the first appellant paid the debt to N.O. and the owner gave the first appellant a mortgage by deed; the first appellant put up the property for sale and the second appellant bought it. The order of events was as follows:-
(1) Mortgage by deed by the owner to N.O.;
(2) Sale by the owner (now mortgagor) to the respondent;
(3) Mortgage by deed by the owner to the first appellant;
(4) Order for specific performance of the sale mentioned in (2) and conveyance to the respondent.
The two appellants acted bona fide, so did the respondent; on the evidence none of them knew of the fraud perpetrated by the owner.
The respondent as plaintiff sued the original owner as defendant No. 1 and the two appellants as defendants No. 2 and No. 3, for a declaration of title and trespass and obtained judgment, and the defendants No. 2 and No. 3 appealed. Briefly put, the trial Judge took the view that the order for specific performance overrode all other transactions.
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DECISION(S) OF THE WEST AFRICAN COURT OF APPEAL
Held (allowing the Appeal; and entering Judgment for the appellants) that:
1. There being no evidence that the appellants acted otherwise than bona fide, the equities must be held to be equal and the law prevails;
2. the owner had not the title either when he purported to sell the property to the respondent, or when the respondent in his earlier action against the owner obtained a decree for specific performance, or when the conveyance was made to the respondent under that decree;
3. the first appellant had the legal estate and was within his rights in selling the property as mortgagee, and the second appellant was a bona fide purchaser for value without notice of any impediment on the title; therefore the appeal would be allowed.
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MAIN JUDGMENT
The following Judgment was delivered:
FOSTER-SUTTON, P.
This is an appeal by the second and third defendants from a judgment of Korsah, J., by which he granted the plaintiff-respondent a declaration of title to the property described in the statement of claim and the sum of £100 damages for trespass.
Shortly put the plaintiff’s claim that he purchased the property in dispute from the first defendant on the 30th July, 1949, for the sum of £750, and that when the first defendant was requested to execute a conveyance of the property in the plaintiff’s favour he refused to do so. The plaintiff thereupon sued the first defendant in the Land Court claiming specific performance of the agreement, subsequently obtained judgment therefor, and since the first defendant failed to comply with the order of the Court the Registrar was directed to execute a conveyance of the property to the plaintiff on behalf of the first defendant, which be duly did on the 8th May, 1951.
The first defendant did not file any defence to the action nor did he put in an appearance during the trial in the Court below.
The second defendant is a half brother of the first defendant and the third defendant is also a relation. The defence of the second and third defendants was that the properly in question had been mortgaged by the first defendant to one Nora Oboshie as security for a loan by a deed of mortgage dated 13th February, 1946. The second defendant averred that he, at the request of the first defendant, paid the amount due under the mortgage to Nora Oboshie, that the first defendant thereupon, on the 16th June, 1950, executed a deed of mortgage of the properly in his favour that the mortgage deed contained the usual “power of sale” in default of payment, that the first defendant having defaulted in payment he caused the premises to be put up for sale by public auction, and that they were duly purchased, at the sale, by the third defendant.
There was no evidence to show that either the second or third defendant had any knowledge of the first defendant’s transaction with the plaintiff. The receipts for the money paid by the second defendant to pay off the amount due under the mortgage to Nora Oboshie were tendered in evidence; exhibits “7” and “8″, as was the mortgage from first defendant to second defendant already referred to, exhibit “6”, which was duly registered in the Registry of Deeds on the 27th July, 1950.
The learned trial Judge took the view that the judgment of the Land Court, in the plaintiff’s action for specific performance against the first defendant dated 10th November, 1950,” implied that title to the said properly was-vested in the plaintiff on 14th January, 1949 ” (should read 30th July, 1949), that is to say the date upon which the plaintiff contracted to purchase the property from the first defendant. He also took the view that the judgment for specific performance overrode all other transactions, and finally expressed difficulty in believing that the second and third defendants did not know of the proceedings for specific performance.
As I have already said, there is no evidence to show that the second and third defendants acted otherwise than bona fide, and it is clear that the plaintiff did. Who then is to suffer from the first defendant’s fraud?
It seems to me that this is a case where the equities must be held to be equal and the law, therefore, prevails.
When the first defendant purported to sell the property to the plaintiff on the 30th July, 1949, the only interest he had in it was an equity of redemption, he having previously, on the 13th February, 1946, conveyed the legal estate to Nora Oboshie by the deed of mortgage exhibit “5”, and by the time the plaintiff had obtained his decree for specific performance against the first defendant on 10th November, 1950, the latter had again conveyed the legal estate, this time to the second defendant, exhibit “6″, dated 16th June, 1950, registered on 27th July, 1950.
It seems to me clear that the first defendant perpetrated a fraud on the plaintiff when be purported to sell the property to him on 30th July, 1949, and that when the plaintiff obtained the decree for specific performance of the bargain, it was of no effect because the title in the property was not then vested in the first defendant, and it is also clear that the conveyance executed by the Registrar of the Court was valueless because he could not convey a greater estate than was in the first defendant. Had the Court been aware of the circumstances it is obvious that the decree would not have been made.
The second defendant did have the legal estate, and was within his rights to sell the property when the first defendant defaulted by non-payment of the amount due under the mortgage deed, and the third defendant was a bona fide purchaser of the property for value without notice of any impediment on the title.
It follows, that in my view, this appeal should be allowed, and that the judgment of the Court below ought to be set aside and judgment entered for the second and third defendants with their costs in the Court below to be taxed and their costs on this appeal fixed at £60 12s. 0d.
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COUSSEY, J. A.
I concur.
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HEARNE, J. A.
I concur.
Appeal allowed; Judgment entered for the appellants.
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