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GN Savings: High Court orders BoG, AG, Receiver to file defence

Source The Ghana Report/ Dave Alamisi

An Accra High Court has asked the Bank of Ghana (BoG), the Attorney-General and the Receiver of GN Savings and Loans Limited to file their defences in response to the case in which Chairman of Groupe Ndoum, Dr Papa Kwesi Nduom, is seeking to reverse the revocation of his company’s licence.

At Thursday hearing, the presiding judge, Justice Gifty Addo Adjei, referred to Chapter five of the 1992 Constitution and stated that the action before the court is anchored around a fundamental right.

With the respondents challenging the jurisdiction of the court to hear the case, Justice Addo-Adjei ruled the court has jurisdiction over the case and adjourned it to January 21, 2020.

The Revocation

It would be recalled that on August 16, 2019, the Bank of Ghana issued a notice to revoke the licence of GN Savings and 22 other savings and loans companies and finance house companies for various reasons.

In respect of GN Savings, however, the Bank of Ghana (BoG) stated that “GN is currently insolvent under Section 123(4) of the Banks and SDIs Act, 2016 (Act 930).”
In the same notice, the BoG appointed Mr Eric Nana Nipah, a Partner at Pricewaterhouse Coopers Ghana, as Receiver to see to the liquidation of the companies.

Nduom’s case

However, on August 30, 2019, Dr.  Nduom and the other shareholders of GN Savings, through their lawyers, Archbridge Solicitors, filed an application at the High Court to challenge the revocation of GN Savings’ licence.

In the suit, the lawyers rejected the Bank of Ghana’s claim that GN was insolvent. They also described the revocation as “malicious”.

The lawyers explained that the Bank of Ghana deliberately refused to consider the entire portfolio of GN Savings’ assets in coming to the conclusion that GN Savings was insolvent.

They, therefore, prayed the court to, among other things, quash the decision of the central bank and restore GN Savings’ licence.

They also filed an application for an interlocutory injunction asking the court to restrain the Bank of Ghana and the Receiver from acting in a way that may overreach the court’s powers or prejudicing their case.

The Respondent’s objection

Rather than file their defence and give reasons for their action, the Bank of Ghana, the Minister of Finance and the Attorney-General chose to object to the jurisdiction of the Court.

They argued that the proper place to challenge the revocation was the Ghana Arbitration Centre and not the High Court.

Dr Nduom’s lawyers, led by Justice Srem-Sai, opposed the argument. In his oral address to the High Court on November 21, 2019, Mr Srem-Sai argued that his clients are entitled to choose which forum to go to for remedies.

He submitted that the High Court has firm jurisdiction over the case. He finally prayed the Court that the objection was baseless and should be dismissed with exemplary cost.

Way Forward

Having dismissed the objection of the Bank of Ghana and the Attorney-General, the case is now set to take its normal course. The Respondents will have no choice but to justify their decision to revoke GN Savings’ licence.

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