Recommended Texts - #Snells book – most authoritative book, Maitlands equity

lectures(must read), kludzes book(made no mention of the American cyanmid case),

anxiety of the judge prior to the grant or refusal of an interlocutory injunction – Josiah
arye – must reads

LESSON 1 – INTRO TO EQUITY

Equity is a supplementary law or it is an appendix on the law. It is not a self sufficient

system; It Is just a supplementary that has been added to the law to make the law
operate better.

King William regarded the whole of England as his by right of conquest. There was the
kings court – courier regis was administering its law. The lord chancellor received all
petitions and issued writs. But the writ system was inadequate because it was rigid and
technical.

Equity developed because of the rigidity and technicality of the common law

Before 1873 and 1875, the judicature Acts were enacted which changed the relationship
between law on equity entirely. As a result of the acts, there was a fusion of law and
equity so that now, the same judge has equity powers as well as law. You don’t have to
physically the court and go to another place for something else

Action in the court of chancery was started by a bill

Equity cannot suffer a wrong without being given a remedy. Equity judges must not be
seen to be in conflict of law. CASE: The Earl of Oxford case 1616 – decided that
whenever there is a conflict between law and equity, equity must prevail – Francis Bakin
J

LESSON 2

1066 – a childless king called Edward the confessor died and was succeeded by
William of Normandy. William of Normandy said he was entitled to succeed Edward the
confessor. William marshaled forces and fought the English at battle abbey.

Les non scriptum dealt with decisions of judges and customs from time immemorial.
Whil the Les Scriptum was a statutory law and of course law written by legislation can
be criticized but the common law was not defined by legis, it was difficult to ascertain
from the decision of the judges. When it became habit, people began petitioning the
king for justice and the king could not deal with legal matters like that so he passed
them on to the lord chancellor
The chancery was normally a bishop and a chancery that required learning in religious
and canon law. So when there was a petition the king then passes it on to them. As far
as law was concerned, the chancery had the mandate to issue out writ.

In those times u had to formulate ur writ to coincide with the specific petition u are
seeking for. After 1258, no new writs could be created. This meant that if u had a cause
of action and that cause of action had no writ, u actually got nothing. People still felt
aggrieved.

The chancellor in the beginning only intervening and giving reliefs based on conscious
and gave them on a peace bill indiv basis as they came ad hoc. But as time went on, he
wanted to create another system that corrected the defects of the writ system.

There was a clash between what equity says and what common law says which shall
we follow and eventually this was settled in the Earl of Oxford case in 1616. It was
decided that in cases of conflict between what equity says and what the common law
says, equity shall prevail and that eventually got embodied in judicature act of 1873 and
1875. These acts simply reformed the common law system.

Primarily, the royal courts were physically separate from the court of chancery. The two
systems run differently because the writ system was run differently from the common
law system. There was a situation where whenever a man had a case at the common
law court, he could as well run to the chancery court to obtain an injunction to stop the
case. The common law judges were not happy about this. But the 1873 and 1875
judicature acts had the effect of fusing both the writ system and the common law
system. So that the chancery court was abolished and a common High Court was
created with divisions.

The judges of this high court were vested with both equity powers and powers of the
common law.

For instance in the case of a trust, we had what we called the propriety rights-right of
ownership and equitable rights – rights of enjoyment or beneficiary rights. The equity
judges carefully avoided interfering with the law by saying that though Mr. A has a right
of ownership to a property, B has the beneficiary right and must be recognized as such.

Article 11(2) – the common law of Ghana shall comprise rules generally known as rthe
common law, the rules generally known as the doctrines of equity as well as the
customary law of Ghana. Equity is thus mentioned as one of the sources of law in
Ghana.

Interpretation Act of Ghana 1960 sec 7(1) – the common law as comprised in the
laws of Ghana consist in addition to the rules of law generally known as the common
law and of the rules generally known as the doctrines of equity and of rules of
customary law included in the common law under any enactment providing for the
assimilation of such rule of customary law as are suitable for general application.
Development of equity form Kludze
It is difficult to define adequately what equity is. However, Maitland described equity the body
of rules administered in England by the Court of Chancery on the one hand, as distinguished
from the Common law courts on the other, before the Judicature Acts of 1873 and 1875.

The emergence of the rules of equity is due to the deficiencies which manifested themselves in
the course of development and the nature of the common law. In the course of time, the
common law became rigid and stereotyped, such that quiet often considerable injustice
resulted from its inability to provide adequate remedies for even obvious wrongs. It was to cater
for such deficiencies of the common law that the rules of equity were developed.

How the common Law Developed

When William the conqueror subdued England in 1066, he decided to impose a uniform system
of administration. He proclaimed himself the owner of all the land right of conquest so that
everybody became his tenant. His variant of feudalism required all persons to owe fealty to him
directly, and everybody who held land in England held it as a tenant of the king. The English King
had his own courts and there were many local courts as well held by the feudal lords, down to
the manorial court under the lord of the manor. The result was that in England, by the end o the
13th century, the principal court were;
a.the many local courts, held by the feudal lords, and
b.the royal courts, known afterwards as the courts of Common Law

The royal courts, later known as the common law courts, exercised jurisdiction over the whole
realm and their writs were valid throughout the whole of England. The local courts on the other
hand, administered local laws and enforced customs which were respectively peculiar to the
particular locality in which they exercised jurisdiction. The royal courts consisted of the King’s
Bench, the Court of Common Pleas and the Exchequer Court. Each of these at first had its own
proper sphere but as time went on each court’s jurisdiction overlapped such that a plaintiff
often had a choice between the three courts. The law was administered by the king’s judges as
they went on circuit in different parts of the realm applying the same rules and principles. By
this time the doctrine of judicial precedent was developed such that a uniform body of rules
were applicable ie. similar solutions were applied to similar problems. To this body of rules
generally applicable throughout the realm which were administered in all the three royal courts,
the name ‘common law’ was given. The law was thus ‘common’ as between the royal courts,
and as regards individuals because all alike were subject to the same laws.

At first, there was not much problem with the common law. In order to commence an action in
any of the common law courts, a writ was issued by the Chancellor. The Chancellor of those
days was not a judge, he was an ecclesiastic, usually a bishop. He was more like as Maitland
puts it, the King’s Secretary of State for all departments.

Writs were devised to suit occasions which arose and therefore, there must have been a
considerable flexibility. Furthermore, the common law rules themselves were still only being
formulated. The doctrine of precedent had also not developed to such an extent as to
constitute a fetter on the growth of the common law
Problems or deficiencies With The common law
In the course of time, the common law became rigid and stereotyped, both as regards
substantive law and procedure. In the matter of procedure, the form of the writ became more
important than the remedy sought. The nature and form of writs became settled and
stereotyped and no new writs could be issued. A plaintiff had to strive to find an existing writ to
fit his case otherwise he was without a remedy in the royal courts. No new writ could be
devised to suit a novel situation. Each different kind of action had its own writ, often with its
own procedure. No action could succeed unless the correct type of writ was used. The writs
became stereotyped because the barons disliked the power to invent new writs; for that meant
creating new rights and duties. To preclude the recognition of new remedies, the Provisions of
Oxford were enacted in 1258 which provided that the Chancellor could not on his own initiative
issue new writs. New writ could be issued only by command of the King and his Council. This
effectively shut the doors of the common law courts to aggrieved parties whose complaints
could not fit into the existing categories of writs. The rigou of these provisions was somewhat,
though not satisfactorily, mitigated in 1285 by the state of Westminister II, more popularly
known as the statute In Consimili Casu. This statute conferred a limited power on the Chancery
clerks to invent new writs, so that if there existed a writ in a like case, falling under a similar law
and requiring a like remedy, the existing writ could be varied to meet the requirements of the
new case. The invention of an entirely new writ was not permitted. There had to be an already
existing writ which could be varied. With such a restricted power of innovation and
creativeness, many a litigant was without a remedy, either because there was no suitable
existing writ or because the existing writ could not be conveniently amended or varied to fit the
particular facts and circumstances of his case. There was also a situation where a fashioned writ
could be thrown out by the judges of he common law courts on the ground that the case did
not fall under a similar law or did not require a like remedy as required by the statute In
Consimili Casu.

2.Another deficiency of the common law arose out of the doctrine of precedent. The doctrine
requires that previous decision shall be followed such that even when a case has been wrongly
decided, it is nevertheless a binding authority it is overruled. Under such a system of
jurisprudence, the common law was fettered by precedent because it could not depart from
previous decisions to d justice in novel situations. Therefore, many litigants even if they could
obtain writs to suit their causes of action, were denied justice because of the operation of the
doctrine of precedent to deny relief under the substantive law.

3.The royal courts administering the common law were sometimes unable to deal with difficult
litigants. The 13th century was a period of uncertainties in England and the machinery for the
enforcement of justice was such that a powerful defendant could defy the court or intimidate
the jury. In such circumstances, the plaintiff was without a remedy even if he found a suitable
writ and the law had a remedy for him. Similarly, a pworful plaintiff could intimidate or bribe
the jury to find for him.

The Intervention of Equity

The intervention took the initial form of direct petitions to the King, to grant an appropriate
remedy for the injustice arising from the deficiencies and limitations of the common law. The
reason was that the King, as the Fountain of Justice, had the residue of judicial power.

At first, the petitions which were referred to as bills were addressed to the King personally.
However, as the number of petitions grew, it became the practice that they were heard by the
King’s Council of which one important member was the Chancellor. In the course of time
however, the petitions were referred to the chancellor directly by the King. Subsequently,
Ordinances in 1280 and 1293, and a Proclamation of 1349, provided that certain petitions
should in the first place be directed to the Chancellor. These provisions resulted in the
Chancellor undertaking an expanding volume of judicial business as the petitions grew fast in
number and complexity. All the same, although by the 14th and 15th centuries the Chancery had
become recognized as a court, its decisions were still issued officially in the name of the King’s
Council or else with the advise of the serjeants and judges. However, in 1474, the Chancellor
issued the first decree on his own authority and thereafter his own decrees were often made. In
this way, there eventually came into existence the Court of Chancery where the Chancellor sat
as a judge administering a system of justice which later became known as equity. In this court,
the Chancellor acted independently of the King’s Council. The chancery was granting reliefs in
cases ‘for the love of God and in the way of charity’.

While the Common law courts decided cases according to the strict technicality of the common
law rules, the court of chancery deliberately mitigated the rigour of the common law, tempering
its rules to the needs of particular cases on principles which seed just and equitable to
successive chancellors. For instance at law, time was of the essence of a contract, so that failure
to perform on the precise date was a breach. The Chancellor however held that time was prima
facie not of the essence of a contract, and would allow a defaulting party to perform it within a
reasonable time after the date stipulated by the parties.

From its early stages of development, equity was not a system of law or a fixed body of rules.
Each case was decided ad hoc by the Chancellor according to his sense of justice. The Chancellor
exercised his powers on the ground of ‘conscience’, which was, in the opinion of medieval
Chancellors, based on universal and natural justice, rather than the private opinion or
conscience of the individual Chancellor. Because equity was not yet bound by precedent, it
became unpredictable. Initially, the early Chancellors were ecclesiastics, usually bishops. As the
clerics yielded their place to the lawyers, equity itself began to crystallize into a fixed body of
rules.

From the Chancellorship of Lord Nottingham in 1673, equity was transformed from a
jurisdiction based on the conscience of the Chancellor into a system constructed around
established rules and principles. Because of his great work of systematization of the principles
of equity, Lord Nottingham is known as the ‘father of equity’. Gradually, systematization of
equity had proceeded so far that by 1818 the rules of equity were as fixed as those of the
common law.
Lord Eldon, Chancellor said that equity and the common law from 1878 hardly differed from
each other insofar as both were based on precedent and fixed principles. Although the
principles of equity may be said t be now well settled, they are flexible and allow the court to
fashion the remedy to fit the claim.
The Nature of Equity

Maxims Of Equity

Equity developed certain guidelines;

1.Equity will not suffer a wrong without a remedy – The reason for the intervention of
equity is to ensure that all wrongs have their corresponding remedies.
CASE: Bank of Credit and Commerce International SA v. Ali
FACTS: The respondent was a former employee of the appellant company who found out that
the company had been operating dishonestly and in a corrupt manner, something he was
ignorant about until the company was winding up. He sued for stigma damages claiming the
company had breached the contract of employment signed between them. The stigma of
association was said o handicap the employees in obtaining other employment.
HELD: He was allowed to recover in the CA which was upheld by the House of Lords

CASE: Tahiru v. Mireku & Anor

FACTS: Some time in April 1983 the defendant agreed to sell his house to the plaintiff for
¢250,000.  It was agreed that payment was to be by instalments.  In pursuance of the
agreement, the plaintiff paid the sum of ¢125,000 which was recorded in exhibit A (receipts and
payments table) prepared in respect of the agreement.  Later, when the plaintiff paid the balance
to the defendant, he refused to accept it on the ground that the plaintiff had delayed payment
and he had subsequently sold the house to the co-defendant for ¢500,000.  The plaintiff sued
claiming specific performance of the agreement and damages for breach.  The defendant
denied the plaintiff 's claim and contended that time was of the essence of the agreement and
that he gave the plaintiff notice before the resale.  The co-defendant on his part contended, inter
alia, that since the transaction between the plaintiff and the defendant was for a disposition of an
interest in land it should have been in writing for it to be enforceable. The court found that (i)
initially time was not of the essence of the agreement, but when it became of the essence, the
plaintiff paid the full balance which when rejected, was paid into court; (ii) the defendant
fraudulently agreed to sell the disputed house to the co-defendant at a much higher price; (iii)
the co-defendant had notice of the prior interest of the plaintiff; and (iv) the plaintiff had to sell
his own house to enable him get money for payment of the balance of the purchase price into
court upon refusal by the defendant.

HELD: (1) under section 2 (a) of the Conveyancing Decree, 1973 (N.R.C.D. 175), contracts for
the transfer of interests in land should be in writing for them to be enforceable.  In the present
case, the defendant signed exhibit A which though described as receipts and payments table,
contained all the terms of the agreement between the plaintiff and the defendant.  That included
the property to be disposed of; the party to whom it was being disposed; and the purchase price
for the sale of the house.  On the evidence therefore exhibit A satisfied the provisions of the
Decree.

(2)       The doctrine of part-performance referred to in section 3 (2) of N.R.C.D. 175 was an
equitable remedy.  Thus where a contract for the sale or other disposition of land or an interest
was not evidenced in writing it might nevertheless be enforced by a decree of specific
performance if it had partly been carried into effect.  An act of part-performance in equity must
be (i) referable to the contract alleged and no other title; (ii) such as to render it a fraud in the
defendant to take advantage of it not being in writing; (iii) the contract in its own nature must be
enforceable by the court; and (iv) there must be proper parole evidence of the contract.  In the
instant case, there was overwhelming evidence showing that there was a parole agreement for
the house in dispute and no other title.  The plaintiff made part-payment of the purchase price,
and the defendant made use of the money to the detriment of the plaintiff.  Accordingly, refusal
to enforce the agreement would amount to fraud in the defendant.  The nature of the agreement
was such that it could be enforced by the grant of decree of specific performance.

CASE: Redco Ltd v. Sarpong

FACTS: The respondent agreed to purchase a flat from the appellant-company at a cost of
¢72,000. In 1980 the respondent made a down payment of ¢19,000, with the remainder to be
paid upon completion.  The appellant in 1981 informed the respondent that the flat would be
ready in December 1981 and was asked to pay a second instalment of ¢31,400. The
respondent agreed and paid ¢32,000. At the end of 1981 no flat was allocated to the
respondent. Seven years later the appellant informed the respondent that the flat now cost ¢3
million. The respondent immediately sued on his contract and claimed specific performance on
the ground that although ¢21.000 was outstanding, what had been paid so far constituted
sufficient part performance to warrant the grant of specific performance.  In his defence the
appellant stated that extraneous circumstances militated against the completion of the flat by
the agreed date.  The respondent then moved the court for judgment in that the defence
disclosed no reasonable defence.  Judgment was then given for the respondent.  On appeal to
the Court of Appeal against that decision

HELD: The basis upon which specific performance would be granted in equity was quite
settled.  Certain contracts were of such a nature that time became of the essence, and a mere
award of damages was not enough.  For example, in contracts of sale where a house was
required for immediate residence, as in the instant case, a delay of six to seven years without
any explanation could not be compensated for by mere damages when it was clear that such
damages could not supply the flat for which the respondent had paid a substantial purchase
price.  There was ample evidence that the conditions set out in the contract to be fulfilled by the
respondent had all been, or a substantial part had been, fulfilled which in equity would entitle
him to his equitable right of specific performance. 

CASE: Day v. Brownrigg

FACTS: The plaintiffs brought the action for an order of injunction to prevent the defendants
from using the name of their villa – Ashford Lodge, which they have used for several years. The
defendants much younger villa was named Ashford Villa but wanted to change the name to
Ashford Lodge like that of the plaintiffs. The plaintiffs claimed it was a great inconvenience and
annoyance which greatly diminished the value of their house. The court held that the act being
complained of was not a violation of any legal right of the plaintiffs and there being no
allegation of malicious intention, the order could not be granted. For in equity, there must be a
wrong that the courts recognize to be a right for them to order a remedy for that wrong

CASE: C v. S & Anor

FACTS: The defendant had been exposed to unshielded chest x-rays which complicated the
unknown pregnancy she was carrying and endangered the foetus. The plaintiff was the father of
the child and brought an action as the next friend o the unborn child, seeking to prevent the
hospital from going ahead with the legal abortion. The courts refused to grant the order on
grounds that a foetus between 18-21 weeks which could not survive outside the womb was not
a child capable of being born alive. Also, the order for injunction could not be granted because
the abortion was legal and was to prevent further damage to the mother as well.

2.Equity follows the law. Both operate in a way to ensure there is no clash.

CASE: The appellant agreed to purchase land from the defendant and payment was to be
done in instalments, and the vndor was to complete an uncompleted building on the said land
for value. The vendor failed to do so and the purchaser entered land to complete the building.
Upon completion, the vendor made a sale of the land and the completed house to another third
party and sought to eject the purchaser from the house on grounds that he had not transferred
any title documents to the purchaser and the purchaser sued. It was on appeal at the SC that
the lower courts erred in deciding the case against the purchaser since findings of fraud on the
vendor’s part were evident. And even if appellant had failed to plead fraud of the vendor, equity
does not permit a statute to be used as an instrument of fraud or inequitable conduct.

CASE: Djan v. Owoo & Anor

FACTS: The plaintiff made payments to the defendant in pursuance of the agreement to
purchase a house from the defendant. Defendant later returned payments made to him to the
plaintiff claiming he was no more interested in selling. Plaintiff sought to enforce the contract
per the receipts given him by the defendants as proof of a contract in writing. The court held
that the receipts were not instruments registrable under Act 122 and since the receipts did not
state the purchase price, it was unenforceable at law. But held that the operation of the rules of
equity would give effect to them as evidence of part performance and therefore, it would be
unconscionable and fraudulent to allow the defendant to refuse to perform his part of the
contract.

3. He who seeks equity must also do equity

CASE: Combe v. Combe
FACTS: Mr. and Mrs. Combe were a married couple. Mr. Combe promised Mrs Combe the
plaintiff that he would pay her an annual maintenance. Their marriage eventually fell apart and
they were divorced. Mr. Combe refused to pay any of the maintenance he had promised. Seven
years later, Mrs. Combe brought an action against Mr. COmbe to have the promise enforced.
There was no consideration in exchange for the promise and so no contract was formed.
Instead, she argued promissory estoppels as she had acted on the promise to her own
detriment. At first instance the court agreed with Mrs. COmbe and enforced the promise under
promissory stoppel. However, this decision was then appealed.
HELD: The court could not find any consideration for the promise to pay maintenance. Lord
Denning stated that the doctrine of consideration is too firmly fixed to be overthrown by a
side-wind. It still remains a cardinal necessity of the formation of a contract and that the High
Trees principle should not be stretched so far as to abolish the doctrine of consideration. Also,
while it may be true that the wife did forbear from suing the husband on the arrears for seven
years, this forbearance was not at the request of the husband. It was also held that in absence
of proof of any request, express or implied, by the husband that the wife should forbear from
applying to the court for maintenance, there was still no consideration for the husband’s
promise(the wife had promised not to apply to court for maintenance). Appeal was allowed

CASE: Lissenden v. CAV BOSCH

FACTS: The defendant attempted to bar the workman plaintiff from appealing a compensation
award on the ground that he had already accepted payment under it. The workman had
obtained an award of compensation under the Workmen’s Compensation Act and had accepted
weekly sums payable there under
HELD: The court held that the mere fact that the workman had obtained an award of
compensation under the Workmen’s Compensation Act and had accepted weekly sums payable
there under does not preclude an appeal by him on the ground that the compensation should
have been of a larger sum than that awarded.

4. He who comes to equity must come with clean hands – also known as the clean
hands doctrine
CASE: Tinsley v. Milligan
FACTS: Miss Tinsley, the plaintiff sought possession of a house that was solely in her name. Her
relationship with her partner, Miss Milligan, had come to an end. Miss Milligan had been living there and
had contributed to the purchase price. It had been in Tinsley’s name alone when they bought it, as a way
of claiming more in social security. Milligan later repented and confessed to the benefit fraud. Then
Tinsley moved out and sought possession of the house, arguing she was solely entitled. Miss Milligan(the
defendant) pleaded that it was the common intention that the property should belong to both of them
(and so did not need to rely on the illegality)
HELD: The House of Lords held that because Miss Milligan could invoke the presumption of a resulting
trust without relying on the illegal purpose, she did have a share in the house. Miss Tinsley would have
to rely on her intention to defraud the social security system to rebut the presumption of a resulting
trust and get the property in her own name.

CASE: Argyll v. Argyll

Edward Derring

5.Where the equities are equal, the law prevails

CASE: Adu-Sarkodie v. Karam & Sons Ltd
FACTS: Mr. Edusei leased his house to the defendants on 1 July 1969 for a term of ten years
with an option for renewal for a further term of ten years.  Rent covering the period 1 July 1969
to 31 December 1975 was paid in advance.  No formal agreement was [p.412] executed but
letters embodying the agreed terms of the lease were signed by the parties. On 14 December
1973 E. sold the house to the plaintiff.  Though the plaintiff was aware of the defendants'
occupation of the house at the time of the purchase, he did not inquire of the nature of their
interests in the house. The plaintiff, after the purchase, invited the defendants to attorn tenant to
him but they refused on the ground that this was not necessary as they were already tenants of
the plaintiff's vendor. The plaintiff thereupon issued a writ to eject the defendants.

Held:

(1) the purchaser of a house had from the fact of the tenant's occupation notice of the tenant's
interest and he took the premises subject to the rights of the tenants.  In the present case, as
the plaintiff was aware of the defendants' occupation of the house but failed to inquire of the
nature of the defendants' interest, he was deemed to have had notice of the defendants' rights. 
(2) The letters embodying the agreed terms were instruments affecting land and should have
been registered under Act 122 but as they were not so registered, they were of no legal effect
and the defendants could not claim rights under them.

(3) Consequently, the defendants had no valid rights under the lease of which the plaintiff should
take notice. The effect of this judgment was to terminate the lease, and the defendants had
become statutory tenants and could only be ejected under section 17 (1) of Act 220. As the
plaintiff ’s claim for ejectment was not based on Act 220, he was not entitled to the relief sought.

6.where the equities are equal, the first in time prevails

CASE:Gyimah & Brown v. Ntiri (Williams-Claimant)2005-2006SCGLR
FACTS: The first defendant made a sale of the same property, first to the plaintiffs-appellants, then to
the claimant, at a time when he had no title to pass the property. However, he later acquired title to it
and upon a dispute over the property, an action was instituted in the HC by the plaintiffs-appellants.
Judgment was reversed by the CA on grounds that plaintiffs had failed to enter into possession of the
property

CASE: Dearle v. Hall

CASE: Bailey v. Barnes

*Constructive Notice
CASE: Usher v. Darko

*Imputed Notice
CASE: Sharpe v. Foy
CASE: Wilkes v. Spooner & Anor
7.Equity imputes an intention to fulfill an obligation

8.equity regards as done that which ought to be done

CASE: Walsh v. Lonsdale (1882) 2ChD

9.Equity is equality – pndcl 111

CASE: Quartey v. Armah
CASE: Biney v. Biney

10.Equity looks to the intent rather than the form

CASE: Earlom v. Saunders
CASE: Metropolitan Electric Supply Co. Ltd v. Ginder

11.Delay befits equity – u must always vigilantly protect your rights

CASE:Adu v. Atta
FACTS: The  defendant had a son in Britain.  To help him out of some financial difficulties she
entered into a contract to sell her house to the plaintiffs for ¢80,000.  The parties agreed that as
the defendant was leaving for Britain to see her son the plaintiffs would pay half the purchase
price, ie ¢40,000 into her banking account.  The defendant spent three months in Britain.  On
her return on 4 October 1979 she discovered that the plaintiffs had not paid the money into her
account.  After she had queried them about it they made an initial payment of ¢15,000 into the
account on 30 October 1979.  As the plaintiffs were experiencing difficulties in raising the
money, they pleaded to be given time up to June 1980 to complete the payment.  The parties
therefore agreed that the balance of "¢65,000 should be paid in four instalments beginning in
December 1979 and ending in June 1980 with one month's grace between payments." the
plaintiffs made no payments until 5 March 1980 when they paid another ¢15,000, leaving a
balance of ¢50,000.  They made no more payments [p.647]until 2 September 1980 when they
paid ¢30,000.  And then on 5 September 1980 they made the final payment of ¢20,000 into the
defendant's account.  They then contacted the defendant and informed her that they had
completed the payment.  But she told them that she had already sold the house to someone
else.  The plaintiffs therefore brought an action against the defendant for, inter alia, specific
performance of the contract of sale.  In her defence the defendant submitted that she was
compelled to sell the house because she was in financial difficulties.  She contended that since
plaintiffs did not pay the purchase price within the stipulated time, they were not entitled to the
equitable remedy of specific performance.  The trial judge however accepted the contention of
the plaintiffs that time was not of the essence of the contract and therefore gave judgment for
them.  On appeal by the defendant the court found, inter alia, that the plaintiffs did not inform the
defendant before they made the last two payments into her account.

HELD: Inter alia that the principles which had always guided the courts of equity to decree
specific performance were that the plaintiff must have shown himself "ready, desirous, prompt
and eager", to perform his part of the contract.  On the evidence contrary to the terms of their
agreement, the plaintiffs failed to pay the ¢40,000 into the defendant's account.  And even after
they had pleaded and been granted extension of time to pay they failed to do so.  Not having
demonstrated equity, they were not entitled to the equitable remedy of specific performance.
12.Equity acts in personam
CASE: Penn v. Baltwitin a specified period. imore
CASE: Re Liddle’s Settlement Trust
CASE: Fynn v. Gardiner
CASE: Busby v. Acquah
CASE: Bassil v. Honger

TWO TYPES OF DELAY in equity;

i.Acquiesence – not saying anything which leads a person to believe he has a title. in
CASE: Debush v. All 1878 CD 206 – Per Lord Texiga, if a person having a right and
seeing another person about to commit or in the act of committing an act infringing upon
that right stands by in such a manner as really to induce the person committing the act
who might otherwise have abstained from it that he assents to it being committed, he
cannot afterwards be heard to complain of the act. This is the proper sense of the term
acquiescence

FACTS:

ii.Laches – this relates to delay in taking legal steps after a party becomes aware that
his rights have been infringed. In other words, laches are unreasonable delay and
inaction by the claimant after the infringement on his right has already occurred.
Agal(dutches) v Agal(Duke)1967CH – in this case, the court declined to grant the
husband an injunction on the ground that the wife did not liscence the husband to
broadcast in church the most intimate confidentialities

CASES - Pay v. brownlie1873, pen v. Baltimore, thorn v. , mariva v. int bulk carriers,
CFC v. accra city council, American cyanamide company – revolutionized the law on
injunction

order 25 rule 1(1) of the High court civil procedure rules o 4r5 states that the court
may grant an order of interlocutory injunction in all cases in which it is just and
convenient to do so. This requirement derives from Section 25 of the judicature act
1873 – a mandamus or an injunction may be granted in all cases in which it shall
appear to the court just or convenient so to do

#Injunction is only ancillary to a substantive case. Injunction is always moved by a

motion. Evidence is given in affidavit form.

Injunction can be in two forms; interlocutory or mandatory-interim(do something) form

OR prohibitory(stop doing something) or perpetual. The courts are generally reluctant in
granting prohibitory injunctions

Scope of the remedy - Injunction applies to every area of the law, in torts, marriage

THE CONCEPT OF INJUNCTION

An injunction is an equitable remedy, thus a discretionary remedy which originated in
the court of chancery. It is issued when the conduct of aprty is likely to cause or will
cause such injury to his opponent that it cannot be adequately compensated in
damages.

An injunction operates in personam. It may be obtained during the pendency of an

action in order to maintain the status quo until the final pronouncement of judgment.

An injunction is an order of a court to a party to restrain/refrain him from doing certain

acts (restrictive or prohibitory injunction) or compels the party to carry out specified
acts(mandatory injunction). It may also be perpetual(forever) or interlocutory(interim)

Where it is issued for the protection of some right in property, it is directed not only at a
party but also at his assigns, agents, servants, workmen, successors in title, et. It is
punishable as by contempt, the contemnor being imprisoned until or unless he purges
his contempt by apology and a promise of future compliance with the order.

There must be a subsisting action before an order of injunction can be granted by the
court. An injunction may be done ex parte which elapses after 8 days or done on notice.

An undertaking in damages may be signed by the party which applies for an injunction
so that in the event of not winning the case, the one who gets the interlocutory
injunction will pay damages to the other party.

Interlocutory Injunctions
Also known as an interim injuction. It can be obtained ater the commencement of a
substantive action in court but before the final determination of the suit. It is given so
things will remain in their status quo before a suit is determined. It is governed by Order
25 of the High Court Civil Procedure Rules, 2004. If the continued interference with
property, which is the subject matter of a suit, may lead to the destruction or obliteration
of the evidence by which the claim may be established, then an interlocutory injunction
will be granted to preserve the status quo ante litem. It can lie against both parties.
Interlocutory injunctions will lie to:
a.Maintain status quo
b.Facilitate the administration of justice
c.Prevent destruction or obliteration of evidence by which claim was established
d.Not render useless or nugatory any judgment which may be eventually delivered in
the substantive suit
CASE: Lardan v. AG –there was an order for deportation. where an interim injuncition
was sought to prevent the execution of a deportation order issued against the applicant
until the final determination of the suit so as not to make useless the pronouncement on
his right and the administration of justice by the end of the suit
e.To avoid a breach of the peace or damage to life, limb or property

In all cases, an application for an interim injunction is made by motion, with an affidavit
setting out the facts constituting the grounds for the application. Usually, the motion on
notice and any desire by the defendant to contest the facts must also be by affidavit. No
evidence is lead in court and the court only relies on the affidavits filed with the relevant
facts. It is only in extreme case, that is to serve the ends of justice that evidence may be
taken in court. If the matter is of a pressing urgency, it may be file ex parte, where one
party is heard and the decision is based on only that person’s affidavit. It is normally
only for a few days until the other party can be served.

Principles Governing Interlocutory Injunctions

1.Inadequacy of damages – By its nature, injunctions are interferences by court with the
individual’s freedom of action. It will therefore not be granted where an award of
damages will be enough. The very first principle of injunction law is that prima facie, you
do not obtain injunction to restrain actionable wrongs, for which damages are the proper
remedy. In a defamation situation, American Cyanamid – stopping his business, cannot
it be compensated after he wins, is it necessarily
CASE: A-G v. Harris
FACTS: The defendants sold flowers at the entrance of a cemetery against the Manchester
Police Regulation Act, 1844 and were fine on several occasions but they still continued with the
business. The AG then applied for an injunction to restrain them from committing further
breaches of the law.
HELD: That the persistent and deliberate flouting of the law was in itself a grave and serious
injury to the public and an order to retrain the defendants from continuing to breach the law
will be granted

CASE: A-G v. Sharpe

FACTS: The defendant had applied for but was refused a licence to operate an omnibus within
the city of Manchester. The law provided for fines for those who did so without a licence. The
defendant neverthelsess continued his omnibus operations in breach of the law.
HELD: The order was granted to stop the defendant from running his omnibuses in
contravention of the law, because the remedies provided under the licensing enactment had
proved to be ineffective.

2.The plaintiff must establish a right. A plaintiff can obtain an injunction against his
opponent if he can show that he has a right in himself which must be protected by the
injunction.
CASE: Maxwell v. Hogg
CASE: Day v. Brownrigg
FACTS: The plaintiffs owned a lodge which the named Ashford lodge. This has been the name
of the lodge for over 60 years but had not registered it. The defendants who lived next to the
plaintiffs also owned a villa which used to be called Ashford Villa but later changed the name to
Ashford Lodge. The plaintiffs applied for an interim injunction to restrain the defendants from
so naming their villa
HELD: An order for injunction was refused because having used a particular name for a house
for over 60 years does not mature into a legal or equitable right into that name.

3.There must be a serious case to be tried – for the plaintiff to be entitled to an

interlocutory injunction, it is necessary that the court be satisfied that there is a serious
case to be tried, and that upon the facts before it, there is a probability that the plaintiff
is entitled to the relief
CASE: Lardan v. A-G: an interim injunction was granted ex parte to restrain the deportation
of the applicant efore the determination of the suit. However, it was discharged because the
applicant was unable to disclose a prima facie ie. Serious case that he was a citizen of Ghana.

CASE: Vanderpuye v. Nartey: The appellant sought the appointment of a manager over the
properties which formed part of the estate left to him by his father, which the respondent had
received as a result of an agency agreement between him and the appellant. The appellant
claimed that the respondent had disposed of some of the properties and not accounted for
them and the respondent on the face of evidence did not seem eager to produce the accounts
despite several years of the appellant making demands for it.
HELD: Amissah J.A. relied on the words of Lord Diplock in the America Cyanamid Co. v. Ethicon
Ltd case where the traditional view of a strong prima facie case was held not to be helpful in the
exercise of the courts discretion in such cases. The threshold was lowered by the Lords to
whether the plaintiff’s action was frivolous or vexatious; whether there was a serious case to be
tried. On the facts of this case, the appellant’s documents show that the properties need be
preserved by an independent body pending the determination of the substantive case for the
status quo to be preserved.

4.Irreparable Injury – The applicant must satisfy the court that if an injunction is not
granted, an irreparable injury would be caused to the property in dispute or to his right;
an injury for which damages would not be adequate compensation.
CASE: Vanderpuye v. Nartey
CASE: American Cyanamid Co. v. Ethicon Ltd
FACTS: A company known as Cyanamid registered a patent in the UK for the use of sutures of
a type that disintegrated and were absorbed by the human body. Ethicon, a rival company
supplied similar sutures in the UK. As the Cyanamid company’s share grew, Ethicon took steps to
introduce their own artificial suture. This resulted in an application for a quia timet injunction
by the Cyanamid company to restrain a threatened infringement of their patent. A large body of
conflicting evidence emerged at the hearing of the motion but the patent judge ruled that the
Cyanamid company had made out a strong prima facie case against their rivals, and on a
balance of convenience, an interlocutory injunction was granted to maintain the status quo
between the parties pending trial. This was reversed on appeal on the grounds that on the
evidence, Cyanamid had not made out a strong prima facie case and on the basis of what was
described as ‘a rule of law’, that a court of law was precluded from granting an interlocutory
injunction or considering the balance of convenience between the parties unless the evidence
adduced at the hearing of the application suggested to the court, on the balance of
probabilities, that at the trial, the plaintiff would be entitled to a permanent injunction.
HELD: The House of Lords reversed the decision and, in restoring the order of the patent judge,
stated that there was no rule of law that the court was precluded from considering whether on
a balance of convenience an interlocutory injunction should be granted unless the plaintiff
succeeded in establishing a prima facie case that he would be successful at the trial. The House
of Lords said that all that was necessary was that the court should be satisfied that the claim
was not frivolous or vexatious; namely, that there was a serious question to be tried. The court
stated further that once the affidavit evidence showed that there was a serious question to be
tried, it becomes necessary that the balance of convenience should be considered.

NOTE: That the American Cyanamid case revolutionize the law on injunction. Lord Diplock in the
case stated that for an injunction to be granted, the following requirements must be present;
a.A serious question to be tried
b.Inadequacy of damages to either side
c.Balance of convenience – the courts must consider whether the balance of convenience lies in
favour of granting or refusing the interlocutory relief that is sought. The wider public interest
may be one of the factors thrown into the scale in assessing the balance of convenience.
CASE: Miller v. Jackson – The public interest of enabling the public to enjoy the game of cricket
as an outdoor recreation was taken into account and prevailed over the private interests of the
plaintiff to the quiet enjoyment of his property.
d.Special cases – There may be many other special factors to be taken into consideration in the
particular circumstance of individual cases. Special cases may be found in each of the following;
i.Where there is no dispute as to the facts ii. Where the grant or refusal disposes of the action
and iii. Actions against a public body or the sate

5.Balance of convenience – An applicant must show that a greater hardship will be

caused if the injunction is refused.
CASE: American Cyanamid v. Ethicon Ltd – The House of Lords decided that the case
having been decided on the balance of convenience should not have been disturbed by the
Court of Appeal. Lord Diplock said that Graham J took into consideration the fact that the
respondent company had no ready market and therefore no business would be brought to a
stop if the injunction was granted against them but the appellant company on the other hand
who were already in the course of establishing a growing market in the surgical sutures would
lose if an injunction was not granted since it may lose on continuing to increase.

CASE: Bilson v. Rawlings – The plaintiff claimed that the defendant was not a citizen of
Ghana because he held dual citizenship and therefore should not be allowed to participate in
the presidential election.
HELD: That the plaintiff failed in discharging the onus of proving beyond reasonable doubt the
claim he was asserting. Also, granting the injunction would cause a greater hardship to the
defendant if he is prevented from contesting the presidential elections and upon the final
determination of the suit, the claim alleged by the plaintiff was even unfounded.

CASE: Mareva Compania Naviera SA v. International Bulkcarriers SA – The defendant

company had failed to pay plaintiff company he money owed it after repudiating a contract with
the latter(appellant-plaintiff company). The trial judge felt he had not the power to grant the
injunction being sought, which was to freeze the accounts of the defendant company to prevent
them from disposing of money therein until the final determination of the suit. He However,
granted it for a short period and the plaintiff company appealed.
HELD: By Lord Denning that if it appears that the debt is due and owing, and there is a danger
that the debtor may dispose of his assets so as to defeat it before judgment, the court has
jurisdiction in a proper case to grant an interlocutory judgment so as to prevent him disposing
of those assets. That this is a proper case for the exercise of this jurisdiction”. Therefore, an
extension o the injunction period was granted.

CASE: GPRTU v. Danful – During the pendency of a suit brought against the
defendants-applicants by the plaintiffs-respondents, the defendants brought an application for
an interlocutory injunction to restrain the latter from acting and holding themselves out as
executive of the branch union of GPRTU. They claimed the plaintiffs term of office had expired
yet, they were still purporting to act as the executives.
HELD: The court held that the injunction would lie against the plaintiffs because their term of
office had expired and on the balance of convenience, there would be no hardship suffered by
them and their continued stay was contrary to the constitution of the union.

6.Conduct of the parties – The conduct of the parties may be taken into consideration
by the court in deciding whether to grant the injunction or not; whther the applicant has
come with clean hands, whether he had acquiesced or delayed, etc.
CASE: Tinsley v. Milligan - Miss Tinsley, the plaintiff sought possession of a house that was solely
in her name. Her relationship with her partner, Miss Milligan, had come to an end. Miss Milligan had
been living there and had contributed to the purchase price. It had been in Tinsley’s name alone when
they bought it, as a way of claiming more in social security. Milligan later repented and confessed to the
benefit fraud. Then Tinsley moved out and sought possession of the house, arguing she was solely
entitled. Miss Milligan(the defendant) pleaded that it was the common intention that the property
should belong to both of them (and so did not need to rely on the illegality)
HELD: The House of Lords held that because Miss Milligan could invoke the presumption of a resulting
trust without relying on the illegal purpose, she did have a share in the house. Miss Tinsley would have
to rely on her intention to defraud the social security system to rebut the presumption of a resulting
trust and get the property in her own name.

CASE: Argyll v. Argyll – An interlocutory injunction was granted to protect against the
revelation of marital confidences, and the newspaper to which the husband had communicated
such information about the wife was restrained from publishing it. (intention of malice to
defame his partner)

CASE: Adu v. Atta

CASE: GPRTU v. Danful

7.Special Cases – Per Lord Diplock in the American Cyanamid case, there may be
many other factors that would be taken into consideration in the particular
circumstances of individual cases. Most of these special cases in England deal with
matters covered by statute. Special cases may be found in each of the following;
i.Where there is no dispute as to the facts ii. Where the grant or refusal disposes of the action
and iii. Actions against a public body or the sate

8.Substantive Suit – A substantive suit must be before the court for one to seek an
injunction. Ie. It is sought during the pendency of a trial.
NB – The discretionary factor of an injunction is minimal if it is to restrain the breach of a
negative stipulation in a contract than when it is mandatory in nature. And it must be fair
and reasonable to do so. Injunctions are discretionary in the sense that in certain
circumstances, the grant will be withheld. These instances include;
1.Adequate damages
2.Minor injury – CASE: Llandudrio Urban District Council v. Woods – the defendants held
services and delivered addresses and sermons on the seashore owned by the plaintiff council.
An injunction to restrain them from futher continuing such activities on their land was refused
because there was no evidence that the acts of the defendant caused any obstructions or led to
a breach of the peace.
3.Difficulty of compliance – the court will not order the defendant to do the impossible.
The difficulty of compliance can however, only be properly considered as a factor in the
exercise of the courts discretion if the difficulty was not created by the defendant
himself.
CASE: Morris v. Redland Bricks – The defendant by his excavations had damaged the
plaintiff’s land causing the plaintiff a loss not exceeding 600 pounds. To repair the damage
caused will cost 35,000 pounds. The order was refused for financial consequences on the
defendant.
4.Undertaking as to damages – Order 25 r.9 governs undertaking as to damages. The
whole purpose of an injunction is to ensure an annoyance or injury being committed will
cease. Therefore, if he de
5.Ceasure of annoyance – where the annoyance complained of ceases before the
application is heard, the application will be dismissed.
CASE: C.F.C. Construction Co. v. Accra City Council – The plaintiff complained of the
defendant’s dumping of refuse in an old quary close to his residence, and the offensive and
pestilential smell seriously interfered with their comfort at home.
HELD: That on the evidence, the dumpind had halted and therefore, the order could not be
granted
6.Conduct of the plaintiff – In exercising it discretion, the courts will look at the conduct
of the plaintiff before and during the hearing, verifying the fundamental postulate of
equity, that he who comes to equity must come with clean hands. Where the plaintiff has
also defaulted in the performance of an obligation immediately and necessarily
connected to the order, the order will not be granted.
CASE: Armstrong v. Sheppard & Short Ltd – The plaintiff misled the court by denying that
he had given an oral permission for the sewers to be laind on his land. This was a reason for the
refusal of an injunction to remove the sewers.

Locus Classicus for Interlocutory injuction against Public Service:

CASE: Ransford France v. AG & EC
The plaintiff brought an action against the AG and EC to halt the creation of new constituencies.

Held: Quoting Date Bah JSC in another case that “It has always been my understanding that the
requirements for the grant of interlocutory injunctions are; first, that the applicant must establish that
there is a serious question to be tried; second, that he or she would suffer irreparable damage which
cannot be remedied by the award of damages, unless the interlocutory injunction is granted; and finally
that the balance of convenience is in favor of granting him or her the interlocutory injunction. The
balance of convenience of course means weighing up the disadvantages of granting the relief against the
disadvantages of not granting the relief. Where the relief sought relates as here, to a public law matter
(emphasis mine) particular care must be taken not to halt action presumptively for the public good,
unless there are very cogent reasons to do so, and provided also that any subsequent nullification of the
impugned act or omission cannot restore the status quo”

This is a good summary of the law on the grant of interlocutory injunction in an area of public law and I
adopt it as my own.
The grant of an injunction was denied because the nation will suffer more in the injunction was granted
than the plaintiff (the balance of convenience titled more in favour of the defendants.
Case for Interlocutory Injunction Against a Person –
CASE: Yehans International Ltd v. Martey Tsuru Family & Former Regal Cinema
Facts: The Plaintiffs sought an injunction
HELD: Even though it is discretionary, we are of the view that a trial court in determining interlocutory
application must first consider whether the case of an applicant is not frivolous and had demonstrated
that he had legal or equitable right which a court should protect
Secondly, the court is also enjoined to ensure that the status quo is maintained so as to avoid any
irreparable damage to the applicant pending the hearing of the matter.
Thirdly, the trial court ought to consider the balance of convenience and should refuse the application if
its grant would cause serious hardships to the other party.

PERPETUAL INJUNCTION

It is also known as a permanent injunction, obtained after the plaintiff’s right has been
established and he has shown that there is an actual or threatened breach of it by his
opponent. It permanently

Freezing Injunction Or Mareva Injunction

The initial common law rule was that u could not get an injunction to restrain an alleged
debtor to refrain from his property –
CASE: Robinson v. Pickering 1881 16CD 660, as a rule, the claimant had either to
obtain summary judgment or judgment at the trial and either levy execution or issue
bankruptcy or winding up proceedings

In the CASE: of Mareva Compania SA v. International Bulk Carriers SA

FACTS: The plaintiffs, Mareva Compania Naviera(ship owners) issued a writ claiming against
the defendants, International Bulk Carrier, unpaid hire and damages for repudiation of a Hire
Agreement. On an ex parte application by the plaintiffs, Donaldson J granted a freezing
injunction restraining the hirers from removing or disposing out of the jurisdiction moneys
standing to their credit account at a London Bank.
HELD: By Denning M.R. that the principle applies that a creditor who has a right to be paid the
debt owing to him, even before he has established his right by getting judgment for it. If it
appears that the debt is due and owing, and there is a danger that the debtor may dispose of
his assets so as to defeat it before judgment, the court has jurisdiction to grant an interlocutory
judgment so as to prevent him disposing of those assets.

The courts developed a major exception to the rule in Robison v. Pickering to the effect
that where a claimant can show a good arguable case to be entitled to money from a
defendant, and there is a real risk that the defendant may remove the asset from the
jurisdiction, or deal with them in such a way as to make them untraceable or unavailable
to the claimant, the court may grant an injunction to restrain the defendant from
removing the asset. This form of injunction came to be known initially as the Mareva
Injunction and is now generally called freezing injunction.

It originated from the commercial court but is now practically granted by all the HC’s. the
application is usually made without notice to the other party(ex parte). The claimant is
under a duty of frankness – uberimmae fidei. In addition, the complainant must give an
undertaking in damages and to inform the defendant promptly of the terms of any such
order granted. The order must usually state the max amount of assets injuncted and
also provide specified amount for the living expenses of the defendant. The claimant
must have a good arguable case and must show a clear risk of disposal of the assets in
remedies. He can also ask for the ancillary remedy of disclosure of document and ask
for the appointment of a receiver. A Mareva injunction may be discharged for
non-disclosure by the applicant.
QUE – What is its significance to our legal system? –aids the court to provide justice for an
aggrieved party, it also aids the court to withhold the property of a debtor until the end of a
hearing, it aids the court after the end of a hearing to order the debtor to repay his debts to a
claimant in the event that the claimant is successful in the hearing.

Anton Piller Orders or Search Orders

These orders grant the court power to authorize one party and its agents and solicitors
to enter the premises of another party and inspect, detain or preserve property being
kept there. Such applications are given without notice as that may afford the defendant
the opportunity to destroy or dispose incriminating evidence.

The remedy provides a weapon against bootlegger, pirates and people in breach of
copyrights and patents as well as industrial and manufacturing processes.
CASE: E.M.I v. Pandit
CASE: Anton piller KG v. Manufacturing Processes Ltd – In the case, the CA laid down
the following guidelines for granting an anton piller order or a search order;

a.The applicant must have a strong prima facie case

b.The potential or actual damage to his interest must be very serious
c.There must be clear evidence that the defendant has in his possession incriminating
material and a clear risk that he might dispose of such material before any application
on notice can be made.
FACTS: Anton Piller are German manufacturers of high repute. They make electric motors and
generators. Manufacturing Processes Ltd is Pillers agent in the UK who were alleged to have
leaked confidential information on how Piller’s manufacture their machines to an English
company. The informants provided Piller with written evidence and correspondence which had
ensued between Manufacturing processes and the English Company. Piller determined to apply
to the court for an injunction to restrain the English company from infringing their copyright or
using confidential information or making copies of their machines. But they were fearful that if
the English company were given notice of this application, they would take steps to destroy the
documents or send them to germany or elsewhere, so that there would be none in existence by
the time that discovery was had in the action.
So the Piller Company applied to the court for an interim injunction to restrain infringement and
secondly for an Order that they might be permitted to enter the premises of the English
company so as to inspect the documents of the plaintiffs and remove them, or copies of them.
The court granted an interim injunction, but refused to order inspection or removal of
documents.
HELD: That a search order can be made by a judge ex parte, but it should only be mad where it
is essential that the plaintiff should have inspection so that justice can be done between the
parties: when, if the defendant were forewarned, there is a grave danger that vital evidence will
be burnt or lost or hide, or taken beyond the jurisdiction, and so the ends of justice be defeated:
and when the inspection would do no real harm to the defendant or his case. However, in the
enforcement of this order, the plaintiffs must act with due circumspection. On the service of it,
the plaintiffs should be attended by their Solicitor, who is an officer of the Court. They should
give the defendant an opportunity of considering it and of consulting his own solicitor. If he
wishes to apply to discharge the Order as having been improperly obtained, he must be allowed
to do so. If the defendant refuses permission to enter or to inspect, they must not force their
way in. they must accept his refusal and bring it to the notice of the court afterwards. It will
however be in the best interest of the defendant for his solicitor to advise him to allow the
search otherwise, the court will make inferences from his conduct. That in this case, there was
sufficient justification to make an order. But that it contains an undertaking in damages which

Due to the draconian nature of the order, the court has prescribed safeguards as to
what must be done during a search eg. The presence of an experienced supervising
solicitor seasoned in the operation of search orders. The application must state the
name of the firm and its address as well as the experience of the supervising solicitor
and also the reason why the search is being sought. As to service, the court require that
the order must be served on the supervising solicitor who leads the search.

Actual search and custody of materials – no material shall be removed from the
premises unless covered by the terms of the order and the search cannot be conducted
other than in the presence of the respondent or a responsible employee. Where an
material is removed, it must be placed in the custody of the respondent solicitor who
undertakes to preserve it and produce it to the court when required. In fact, in
appropriate case, materials removed must be insured against loss and damage and the
supervising solicitor must make a list/inventory of all materials removed and give a copy
to respondent solicitor, affording respondent reasonable time to check the list. Applicant
must make sure that all steps are taken to preserve information and data at the
premises.
QUE – what is its significance to our legal system? –
So that debtors will not abscond will be made to pay their debt, to encourage people to be
honest, to encourage contractual relations – where when there is a breach, one can sue for
enforcement.

QUIA TIMET INJUNCTION

This is where there is no breach but a threat of breach. This injunction is applied for not
because there has been a threat in property or other matters but because the applicant
fears a threat. CASES: AG v. Long Eaton UDC (1915) CL 214, CASE: Mahmoud
Wangara v. Gyato Wangara 1982/83 GLR 639

The applicant must prove danger complained of is substantial and must show a strong
probability of actual danger.

The first thing the court takes into consideration is whether or not u have an equitable or
legal right before an injunction can be given to u ….
CASES: Ollenu in Majorlagbe v. Larbi1959 GLR90, Denning in Thorne v.
BBC1967WLR, Day v. Brwonrigg1878
You must also demonstrate that irreparable damage will be caused if injunction is not
granted.

The removal of prima facie case has reduced the threshold of proof. CASE: London V.
Blackwall rly co ltd 1886 31CH 354@369 Lord Lingly – the very first principle of
injunction law is that prima facie u do not obtain injunction to restrain actionable wrongs
for which damages are the proper remedy. Ie. If there is a wrong, ur first point of call
should be damages. Unless damages will not be sufficient

High court civil pro rules Sec 45(9) – undertaking in damages that the successful
party must take an undertaken in damages so that in case the defendant wins, he gets
compensated.

An order of injunction can be discharged, can be varied or suspended.

If the party does not do the undertaken then the order is void.

SPECIFIC PERFORMANCE AND ITS LIMITATIONS

Like injunction, specific performance is also a discretionary remedy which operates in

personam especially in the area of contracts where the common law only gives
damages. While upon a breach of contract, the common law offered damages, equity
intervenes to enforce the performance of the contract on account of the inadequacy of
damages.
It’s not particularly awarded in the following cases;
1.Illegal or immoral contracts
2.Agreement without consideration
3.contracts contrary to public policy
4.Contracts requiring personal skill – CASE: Lumley v. Wagner - held that the court
could not compel the defendant to sing despite the threat of committal for contempt of
court
FACTS: Lumley, the plaintiff contracted with Wagner the defendant for her to sing at the
plaintiff’s theater for three months. Under the contract, the defendant promised not to perform
at other theaters while under the contract without written consent. The defendant
subsequently arraged to sing at another theater for more money. The plaintiff sued and sought
an injunction preventing Wgner from performing at other theaters. The trial court granted the
injunctive relief for the plaintiff and the defendant appealed.
HELD: That the court cannot compel specific performance to render personal services but it can
grant the remedy of injunctive relief to prevent a party from performing personal services (ie. It
cannot ensure but it can prevent)

CASE: Busbey v. Acquah

CASE: Sbaiti v. Samaransnge

FACTS: The defendant entered into an oral agreement with the plaintiff to let to the plaintiff for
a term of five years premises, not then completed, at an annual rent of ¢5,000.00 for use as a
school.  The agreement was never reduced into writing, but a note confirmatory of the lease
was prepared by the defendant for the plaintiff to show to the Ministry of Education.  To ensure
early completion of the building, the plaintiff supplied building materials. When the main
premises were completed the defendant refused to give possession to the plaintiff who therefore
sued for specific performance.  The defendant counterclaimed inter alia that there was no
sufficient note or memorandum of the agreement as required by the Statute of Frauds, and that
the confirmatory note, not having been registered under the Land Registry Act, 1962, was void
and of no effect.
Held: the agreement was never reduced into writing and exhibit A was never intended for the
plaintiff. The evidence clearly showed the essential terms of the tenancy and that the defendant
had taken the benefit under an oral contract partly performed by the plaintiff.  It was therefore
only fair, just and equitable that she should accept the burden of performing her part of
the oral agreement.  This was one of the cases of an equity created by estoppel where
the defendant must and ought to be compelled to perform her part of the contract the
benefits of which she had accepted. Consequently the plaintiff was entitled to an order of
specific performance of the agreement. 

The courts will have to consider contracts carefully to see if it’s suitable for specific
performance. Only enforceable contracts can give rise to specific performance –
CASE: Short v. Morris

Generally speaking therefore specific performance is not usually ordered for

government stocks or shares readily available in the open market because these are
substitutes u can readily obtain
CASE: Fofie v. Zanyo –
FACTS – The plaintiff alleged that the defendants made a sale of a building to him and
later denied that they had made such sale. The plaintiff sued for specific performance of
the contract. The defendants counterclaimed that though they made an offer of sale in
writing, the plaintiff did not accept the offer. The court of first instance gave judgment for
the plaintiff and the defendant appealed.
HELD: Specific performance was a discretionary and supplementary equitable remedy
available to either party to a contract. However, the court would refuse to grant the remedy in
circumstances where it would be unjust to grant it. One of the conditions for the grant of specific
performance in land cases, as required under section 2(a) of the Conveyancing Decree, 1975
(N.R.C.D. 175) was that there had to be a valid contract in writing. However, the court was
entitled in certain cases to permit a contract to be proved by oral evidence, even though of a
kind required to be proved in writing, when the party seeking to enforce the contract had done
acts in performance of his obligations under it. The court would exercise its discretion where (a)
the act of part performance was referable to only the contract alleged; (b) they were such as
would render it a fraud in the defendant to take advantage of the contract not being in writing;
(c) the contract by its own nature was enforceable by the court; and (d) there had to be proper
parol evidence of the contract let in by the act of part performance. However, since on the
evidence all the payments made by the plaintiff to and on behalf of the defendant were in
respect of rent and not the purchase price, the plaintiff failed to prove the existence of the
contract of sale; and the plaintiff needed the consent of the defendant to use the title deeds to
the property to enable him borrow money from the bank, he failed to make out a case to entitle
him to the order of specific performance.

DEFENCES TO INJUNCTION
1.Inadequacy of damages

2.Undertaking
U can have the defendant claiming the inadequacy of damages. So u deny that even if
the defendants averments are correct, damages is a sufficient remedy. Undertaken by
the defendant itself operates as an injunction the breach of which leads to contempt of
court.

RECTIFICATION OF THE DOCUMENT

It’s a two tier concept.
Rectify to
It’s a discretionary remedy given based on the inflexibility of the common law and the
inadequacy of t
Case whiteside v. Whiteside 1960 CH 55@51
Where thru a mistake, a written agreemt does not reflect the two agreements between
the parties. Rectification in such instances is aimed at the manner of expression of the
… on paper
in the case of Mackenzy v. Koomson 1869 it was emphasized that the courts do not
rectify contracts but rather they rectify documents purportedly made in pursuance of the
term of contract.
Being discretnary an order of recti will not be granted if the same results cud be
achieved thru other methods of remedies for instance thru the parties own voluntary act
of rctifiatn
All contractual documents including ,marriage settlement, bill of quanties and bils of
exchange may be rectified. And once rectificatn I ordered, no new document needs to
be executed. A copy of the order is simply endored on the rectified instrument which
operates retrospectively and thus validates contracts already undertaken under the
document.

RESCISSION
Rescission is not a judicial remedy however since parties usually seek the assistance of
the court, detailed rules have been formulated especially relating to restitution of
property.

Rescission is used in a sense to have a contract As ‘never having come into existence’.
Per Lord Wilberforce in Johnson v. Agbey 1980 AC 367@393

Since only the courts of equity could order accounts and make arrangements for
deterioration of property, when a party to a transaction rescinds, he exercises a right to
set the transaction aside and to be restored to his previous position and once a party
rescinds, he is entitled to recover and bound to restore property which he may have
acquired under the contract. But a contact liable to rescission remains valid until it is
rescinded and if in the mean time third parties acquire rights under the contract, this will
bar the right to rescission and restitution of property. Illegality may prevent restitution of
property.
CASE Gascoigne v Gascoigne1918 1KB 223

Once a contact is rescinded, plaintiff or victim is restored to his state prior to the
contract. Consequently, it depends on the circumstances of the case, all rights acquired
under the transaction including rights to property, possession and monies must be
returned or given up. Accounts are then taken of profit and depreciation but no
damages are recoverable
CASE: Redgrave v. Hare 1881 20CHD

GROUNDS FOR RESCISSION

A contract may be rescinded based on the ff;
Misdescriptn
mistake
Fraud
Fraudulent and innocent misrepresentation
The right of rescission may be lost by acquiescence by the right of restituo integrum and
by the intervention of third parties impossibility. Also, if a party elects to waive rescission
and affirms a contract, especially after notice of the act given right to rescission, he
loses the right to rescind.
Accounts
The procedure for an action of accounts was at common law extremely unsatisfactory
such that the common law action for account gradually fell into disuse largely on
account of the sheer inconvenience of the procedure as well as the availability of
alternative forms of action.

After the passage of the judicature acts, the taking of accounts was assigned to the
chancery. In pleading a claim for an account, it is necessary to clearly identify the
relationship between the plaintiff and the defendant and to express why the defendant is
liable to account. The defendant otherwise known as the accounting party, may be a
trustee, an agent, an administrator or a mortgagee in possession. The plaintiff should
plead such material facts as shown that the defendant has not accounted to him the
way he should

TOPIC 6 – EQUITABLE REMEDIES

CASE: Lumley v. Ravenscrost 1895 1QB 683
CASE: Sogboti v. Omabegho DC Land 1952-1955 121
CASE: Lartei v. Fio 1960 GLR 119 – Ollenu J
Basby v. Acquah
Sbarti v. Smars

Delivering Up And Cancellation Of Document

Forged document, be it land document – where a person relied on that document, one
of the remedies the other party should request is Delivring up and cancellation of the
document so that the party will not use it in another jurisdiction.

Unconscionable Bargain –
Sec 18 of the conveyancing decree 1973 NRCD 175
The court should reopen the bargain so that the terms can be redressed. It usually has
to do with widows, children, poverty etc.
CASE: Dikyi v. Ameen Sangani 1991 1GLR 61

Forfeiture Clauses –
This relief was offered by equity to parties to a written agreement
When the primary purpose of a provision for a forfeiture in an agreement is to help
secure an express result, equity will grant relief against forfeiture. It takes into account
the willfulness and the general conduct of the applicant together with the gravity of the
breach and the disparity in value between the forfeitured property and the actual
damage caused by the breach.
Equity grants relief where in substance, the forfeiture was only a security for the
payment of money

Penalties In Agreement –
It is usual in drawing up contracts to create a penalty clause which is held over the head
of the other party in terrorem(ie. Sword of Damocles over your head)
In all cases, the court looks at the substance rather than the form and in the light of the
terms and circumstances of the agreement.

Action For Accounts

The common law action for accounts “accounts” fell into disuse because of the
availability of the equitable alternative for account. Eventually, with the enactment of the
judicature acts, the taking of accounts was generally assigned to the court of chancery.
But people could go to the queens bench of accounts in a general nature.

In pleading a claim for account, it is essential to set out and identify the relationship
between the parties which entitles the plaintiffs to an account but it is not necessary for
the plaintiffs to provide particulars of that account as the … esp where the agency

Once an account is filled upon the orders of the court, the accounting party normally
also files an affidavit in verification together with the notice of lodgment. The other party
may then file the list of objections and ask for an additional account.

A claim for account may be defended on three main grounds;

1.that the defendant is not accountable to the plaintiff
2.that the defendant has already fully accounted
3.that there is a settled account between the parties

The defendant may also object that an account is an unnecessary form of relief
because the ingredients for the account are readily known and identified for the plaintiff
and therefore that the plaintiff really ought to sue for a debt rather than have the
expense of an account

The plaintiff may also ask for the account to be set aside for error or alternatively, he
may seek leave of the court to surcharge and “falsify”. He surcharges by seeking to
amend the accounts by adding items to his adv which were omitted and he falsifies by
striking out disadvantageous items
CASE: Marfo v. Adusei 1963 1GLR 225

LIEN
This is a method of coercion into payment of a debt involving the passive retention of
property. While a lien lasts, it is good against the whole world. An equitable lien may
arise out of the operation of the doctrine of equity and it is not dependent on
It confers a charge upon property until specified claims are satisfied. For instance, a
vendor of land or the seller of a parcel of land has an equitable lien over it until the full
purchase price is paid although the land may have already been conveyed to the
purchaser who may have already taken possession. The vendor may apply to the court
for a declaration of a charge and for an order of a sale equitable to the debt. The lien is
destroyed once the creditor hands over the property to the owner.
ACCIDENTS
In equity, the concept of accident covers any unforeseen event not attributable to the
defendant’s misconduct, negligence or culpability but which nonetheless, occasions
loss. Equity grants relief on accidents which is unjust, the strict application of common
law rules. Again, where a party looses valuable documents such as title deeds or
shared certificates and common law rules as to admissibility of secondary evidence fail
him, equity must come to his aid.

THE DOCTRINE OF BONA FIDE PURCHASER FOR VALUE WITHOUT NOTICE

Bonafide means good faith. You must have bought a land and paid with money and
without notice to defects in title. So the seller’s title is defective but you were not aware
of that. So how does equity protect you and ensure fairness? But equitable rights
suffered an Achilles heel which is where the BFPFVWN comes.

While legal rights are good against the whole world, equitable rights are good against all
comers except a bonfide purchaser of the legal estate for value without notice and those
claiming through him. The concept of the BPFVWN demonstrates that equitable rights
fall only slightly short of legal rights. In other words although equitable rights became
rights in rem, they suffered a peculiar infirmity and were not quite as impregnable and
indefeasible as legal rights. As a result of this doctrine, equity always tops, stop short of
enforcing a right against a purchaser who had bought from the legal owner in genuine
ignorance of a defect in title. In other words, equitable rights were in vulnerable in the
sense that they could be lost in the sense that any time the legal title vests in the
another person, you could lose the equitable rights. This gives rise to the BPFVWN as
equity’s darling .

On the other hand, a person who takes land without giving value in exchange, is said to
take the land with all its burdens both legal and equitable. This is the case of heirs,
donees and executors.
CASE: Pilcher v. Rawlings 1872 LR 7CA 250 @@268,269 – “SUCH A Purchasers plea
of purchase for value for consideration is an absolute, unqualified, unanswerable
defence and an unanswerable …. Such a purchaser may be interrogated and tested to
any extent as to the valuable consideration which he has given in order to show the
bonafide’s or malafides of his purchase and also the presence or the absence of his
purchase but once he has gone through that ordeal, … then according to my judgment,
this court has no jurisdictionm whatsoever to do anything more than let it be part of that
legal estate, that legal right, that legal adv which he has obtained whatever it may be”
CASE: Donkor v. 1989/90 1GLR 178

If you make an order for accounts, you must also make an order of payment.

LESSON 7 – THE NATURE OF TRUSTS

It has the relationship of a transferor trusting a person to transfer his property to a
transferee for the use of a beneficiary.
The trust relationship involves certain duties and certain expectations some which are
that the trustee is not to benefit from the trust ie. His duties must not conflict with the
interest. The beneficiaries are different from the managers or the trustees. There is a
clear distinction between control and benefit; the trustee has the control and the
beneficiary has the benefit.

DEFINITION
It is very difficult to get a definition
Underhill defines a trust as an equitable …
Pettit has added to Underhill’s definition …
Keeton defines a trust as a relationship which arises whenever a person called the
trustee …

CHARACTERISTICS
It arises when property is conveyed by a transferor to another person. A is settler, B is
the trustee. The trustee may be one of the beneficiaries. There is no situation where u
can have a sole trustee and a sole beneficiary ie. Where one person is the trustee and
at the same time the beneficiary ie. He is not to benefit from his position as a trustee.
There is a situation where you have one beneficiary and two trustees.
The characteristics of a trust are as follows;

1.It is a relationship in various ways. Ie. A relationship between people; at least three - a
settler, a trustee and a beneficiary.

2.It is a fiduciary relationship ie. A relationship of trust. Eg of fiduciary relationship –

lawyer and client, guardian – ward, etc

3.It is a relationship which involves property; movable or immovable

4.It is a relationship in which the power of control is distinct from the right of benefit.

5.It involves the existence of equitable duties intended to ensure that he holds the
property, or manages the property not to benefit from it but rather, it is the beneficiaries
who benefit

6.It arises out of an intention to create a relationship – express trust. Or it is implied,

presumed or imposed by equity where equity considers it unconscionable for the holder
of the title.

DISTINCTION BETWEEN TRUSTS AND OTHER LEGAL CONCEPTS

i.Trust And Administration Of Estate And Execution of Estate
the Position of The Trustee as against the position of the administrator of an Estate
The two are quite similar because for a very long time the courts of equity have
imposed a duty on …;
1.The trustee and the administrator is to exercise the same duty of care in the
administration of the estate
2.The administrator hold the title for the benefit under the will or under the rules of
intestate succession – PNDC law 111 and the trustee also holds it for the benefit of the
beneficiary.
3.They both occupy a fiduciary position.

Difference In Function
1.Generally, the function of the executor is to wind up the estate, pay the just debt of the
testator and distribute the property according to the rules of intestate succession.
A trustee on the other hand is to hold the prop and to manage it for the benefit of the
beneficiary. Their job is not to give the property to the beneficiary.
So, generally, the admin of an estate is for a short time while the holding of a trust can
go on for a long time.

2.Personal representatives has the whole ownership of the proper both legal and
equitable during the administration of the estate. There is no instance where the legal
interest is in one person and the equitable interest in another person. All is vested in the
one person – the administrator. This means that until a vesting assent has been done or
executed the beneficiary does not get an interest in the property. And it is only after that
that title is conveyed from the testator to the beneficiaries.
But as with a trustee, the executor is not to benefit personally from his administration of
the estate. So he has both legal and equitable ownership of the property so he can
administer the property properly. The duty of the executor can be enforced by
application of a creditor or beneficiary in court.

LESSON 8 – TRUSTS AND AGENCY

Like the trust, the agency is also a fiduciary relationship. As a consequence, at law,
there are similar duties imposed on agency. Both a trustee and an agent must not put
themselves in a conflict of interest position. Both cannot delegate their responsibilities.

The principal agent relationship arises out of contract but no such relationship between
a trustee and beneficiary.

Secondly, with agency there may not be property involved but trust is always property.
Agency is a personal relationship and trust a proprietory one. Agency represents the
principal trustee acts in the interest of beneficiary
.
CLASSIFICATION OF TRUSTS
Trust may be classified into;
1.Public and Private Trust – Based on object or purpose of trust.
Private Trust – A trust is private if it is for the benefit of an individual or class of indiv
persons, even if any benefit may be incidentally conferred on the general public. A
private trust is ordinarily enforceable by any of the beneficiaries.
Public or Charitable Trusts – A public or charitable trust is a trust whose primary
object is the promotion of the public welfare, though it may incidentally benefit an
individual or a class of individuals. It is enforceable by the Attorney-General.

2.Statutory Trust – Where by legislation, trusts are established eg. SSNIT. Objective of
trust provided for by legislation.
Article By Da Rocha on The Future of the social security and National insurance Trust:
The need to break its monopoly in Pension Fund Management
In the article, Da Rocha quoted from a Daily Graphic reported that the Deputy Director
of the social security national insurance trust (SSNIT) was reported to have declared
that the pension scheme operated by trust could not be sustained beyond the next 25
years at the current rate of contributions to the fund which is 17.5% if the monthly salary
of workers. The Deputy director further stated that to cure this looming crises, the
contribution must be increased to 35% in order for the trust to be sustainable.
Da Rocha mentioned that this statement could cause serious national problem since a
collapse of SSNIT will be a national disaster.
Da Rocha therefore made an attempt to put forward some suggestions as to how
SSNIT should operate in the future –
1.He talked first about the nature of the SSNIT Pension Scheme – He said that though
SSNIT is not a State Pension scheme, but rather funded entirely from public funds(ie.
private pension scheme funded by contributions from salaries or wages of workers), it
has been given a national character y having been set up by social security Law 1991,
PNDCL 247 which compels all workers and all employers in all establishments in Ghana
to contribute to its Fund. Therefore Sec 19 of the PNDCL 247 provides that “The Board
shall cause to be maintained for each member, an account to which shall be credited all
contributions”. The Social Security Regulations 1973 L.I. 818 Regulation 21 makes the
ownership of the money in the Fund even clearer. It provides tht the Trust at the end of
each year shall furnish to the employer of each member, and the employer shal transmit
to the member, an annual statement showing the accumulations in the Fund to the
credit of the member. To Da Rocha, it seems the Board of the Trust and even
Government have no clear perception of the true nature of the SSNIT Pension Scheme
and this lack of perception has led to the Fund being treated as a kind of public fund,
and money from it being used for purposes which have no bearing on the object for
which it has been created.
2.He also talked about the monopoly status of SSNIT in the sense that every employee
and every employer of every establishment in hana is compelled by statute to contribute
to the SSNIT Fund and be a member of its pension scheme eve though the employers
and employees may set up a private pension, provident fund or gratuity schemes for the
benefit of employees outside of SSNIT, it does not absolve them from the obligation and
liability to contribute to the SSNIT Fund – Sec 21(1) of PNDCL 247 makes it clear.
COMMENT – I think this is in bad faith since, parties who give their property to be kept
in trust must have the option of choosing who they trust to entrust their properties.
-Another defect of this monopoly is that the scheme is not subject to any regulatory
control by an independent regulatory body which should have been the case in trusts
3.The third point Da Rocha talked about is whether SSNIT is conscious of its character
as a trust? To him, the board and directors of SSNIT do not appear to be conscious of
their trustee status and their obligation to promote the objects of the Trust as set out in
SEC 3 of PNDL 247 which provides inter alia that the trust is to provide social protection
for the working population for various contingencies such as old age, invalidity and
such other contingencies as may be specified by law, and to carry out such other
activities as may appear to the Trust to be incidental or conducive to the attainment of
its objects under this Law. Da Rocha mentions that the objective of the Trust to provide
social protection to its members cannot be achieved unless the money which steadily
flows into the Fund of SSNIT is invested in the mnner in which trustees should invest
trust funds. He adds that the puropose of investing money is to make profit. Sometimes
however, money may negligently, imprudently or dishonestly be applied to purposes
which do not yield profit, but rather create losses. Such an application of trust money
clear breach of trust. The lack of intention to create profit is made clear in a statement
attributed to the Brong-Ahafo Regional Manager when he presented ten computers to
Sunyani Polytechnic as a gift. He was reported to have said that the donation was in
line with the corporate responsibility of SSNIT to complement government effort in the
provision of inputs for learing in a number of education institution in the country. Da
Rocha is of the view that, however good the intention of SSNIT may be, its directors
have no right or authority to make gifts to any person, body or organization out of a
Fund which the collective savings of workers for puposes of contingencies of old age,
invalidity and other contingencies. And the act of gifting is a clear breach of trust.
4.Fourth point he looked at was how SSNIT has been Managing and Investing the vast
sums of workers money paid into its fund every month. He mentioned that there are no
published figures on how much money SSNIT receives monthly or yearly as
contributions to the Fund, nor on how much it spends. It is believed that as much as
20% of contributions is spent on administration annually. This is unjustifiably excessive.
As far investments are concerned, it is generally known that SSNIT has invested in
many areas but details of them are shrouded in secrecy. The owners of the money in
the SSNIT fund do not know how much profit, if any, the investments have been making

He went ahead to Suggest Ways to cure these defects in the scheme;

Da Rocha admitted that the present social security law 1991 PNDCL 247 is deficient
because it was enacted before the 1992 constitution came into effect and therefore
there was no opportunity for civil society discussion of is provisions. There was no
parliament to debate it before passing it into law. He therefore suggested that a new
Social Security and Pension Law be enacted and that the new Act should have the
following provisions to make it comprehensive;
i.It should abolish the monopoly status of SSNIT as managers of the only pension
scheme Fund to which employers and employees must contribute by statutory
compulsion. That provision should be made for the setting up of other private pension
schemes. Employers should be free to deduct a percentage of what is now compulsorily
paid to SSNIT, to pay into alternative pension schemes of their choice. In this way
employers and employees will have some freedom of choice and SSNIT will face the
kind of competition it needs to make it more efficient. He however admits that SSNIT
cannot be simply wound up suddenly without causing serious disruption and instability
but however states that its scale of operation can and should however be reduced
considerably to make it more efficient and beneficial
ii.It should make clear provisions for the manner in which trustees are appointed.
Setting out their functions, powers, obligations and liabilities.
iii.A pensions Regulatory Commission should be established to oversee the running of
All private pension schemes including SSNIT.

3.Express, Constructive, Implied and Resulting Trusts –

i.Express Trusts – An express trust is a trust created by an express declaration of the
person in whom the property is vested. It is also sometimes referred to as a declared
trust. An eg. Is where A conveys property to B in trust for C; or where in his will, a
testator gives property to T in trust for X.

An Express Trust May be either executed or executory

The expressions executed and executor are used in reference to the creation of the
trust and not to the carrying out of it.
a.An executed Trust – An executed trust is an express trust in which the testator or
settlor has marked out in appropriate technical expressions the interest to be taken by
each of the beneficiaries. The testator or settlor is in such a case said to have been his
own conveyance or draftsman. An eg. Is where property is conveyed to A in trust for B,
or to A in trust for B for life and after his death, for C absolutely. In either of these
example, the trust is executed because each beneficiary’s interest is defined precisely
and there is no need for a further instrument.
b.Executory Trusts – An executor trust is an express trust in which the testator or settlor
has created a trust in favour of beneficiaries, and although he may indicate a scheme
for settlement, the details are left to be filled in by the trustees. Although the objects of a
trust must be certain before a valid trust can come into existence, there is no
requirement that the instrument creating the trust should in the first instance mark out
precisely the interests which each of the objects or beneficiaries is to take in the trust
property. The quantum of interest of each of the beneficiaries, including the delimitation
of the interests of the life tenant and the remainderman, may be left out to be settled
later. An eg. Is where property is settled on trust for A and his children without marking
out the interest of each beneficiary. They are more common in marriage settlements
and wills. In such a case, it is yet to be decided what should be the portion of each of
the children.

An express trust may also be classified as either complety or incompletely constituted.

i.Completely constituted trusts – this is when trust property has been vested in trustees
for the benefit of the beneficiaries. Until the trust res is vested in the trustee, the trust is
incopletly constituted(in fieri). The crucial issue here involves the methods of vesting the
property, which are usually not matters for equity but for the common law, and will also
depend on the nature of the property. In the case of a trust of land, there is the need ofr
a writing at law in order to transfer the interest in the land to the trustee. Therefore, a
trust of land cannot be completely constituted without a wring to satisfy the requirement
of the convveyancing Decree or the statute of Frauds. Freehold property must be
conveyed by a conveyance and leasehold property conveyed by a written assignment,
and shares by an appropriate transfer. Movable property which is subject to a trust,
hwoever, does not require writing and the trust may be completely constituted by mere
delivery or by deed.
Note that a completely constituted trust is not necessarily an executed trust. For eg. If
money is bequeathed to X on trust to lay it out in the purchase of land to settle the land
on Y and his children, this would be a completely constituted trust because the property
would have been vested in the trustee. The trust would however, be executor because a
further instrument would be necessary whereby the details would be filled in byy the
trustee. A tust arising under a will may be completely constituted because the will vest
the property in the trustee, although it may be either executed or executor.

If the trust is incompletely constituted, there is technically no trust; for generally it cannot
be enforced.
EXCEPTION - The only possible exception is that the beneficiaries under an
incompletely constituted trust can enforce it if they have given consideration; for,
although equity will not assist volunteer, and equity will not perfect an imperfect gift, a
party who has given value may seek the aid of equity. Also, where the donar has done
all in his poer to vest the legal interest in the trustee but some other third party has not
done his part, equity will regard it as a perfect gift and enforce the trust.
CASE: Re Rose – the donar had executed a voluntary transfer of shares and given it
together with the share certificates to the done. It only remained to get the transfer
registered by the company but this was not done before the death of the donar. It was
held that the gift was valid because the donor had done all that was necessary on his
part to divest himself of the shares to make the gift; for the completion of the legal title
by registration was only the act of a third party.
SUMMARY – Once completely constituted, the trust may be enforced by any
beneficiary, whether he has given value or is a mere volunteer. However, an
incompletely constituted trust can only be enforced by beneficiaries who have given
value and not by volunteers; for, there is no equity to perfect an imperct voluntary trust
and equity will not assist a volunteer.
A completely constituted trust may be created in two ways;
a.By conveying the property to trustees
b.By the owner declaring himself a trustee of his property. In this case, the trust
becomes completely constituted and there is no need for vesting; for, the settlor trustee
already has title. However, where the owner of landed property declares himself a
trustee of the property for a beneficiary (cestui que trust), the declaration must be
evidenced in writing signed by himself or his agent duly authorized in writing, in order to
satisfy sec 1 of the Conveyancing Decree 1973. If the trust relates to property other
than land, writing is not required and the trust may be orally declared or even merely
inferred from conduct.

ii.Implied Trusts – An implied trust arises where there is a presumption that there is an
intention to create a trust, even though there is no proof of the use of express words to
that effect and the formalities for creating a trust are lacking. Sometimes an implied trust
arises from the failure to satisfy the formalities necessary for the creation of an express
trust. By virtue of section 111(2) of the Courts Act, 1971, a declaration of a trust of land
must be manifested and proved by some writing. The same provision is now contained
in Sec 1, 2, and 3 of the Conveyancing Decree, 1973. If this condition is not satisfied,
there may still exist an implied trust. This may also sometimes be known as a
presumptive trust. The rationale of the presumptive or implied trust is that if a trust was
not implied, the intended trustee could take the property as purchaser with a right of
beneficial enjoyment which will amount to fraud
CASE: Quartey v. Armah (the plaintiff and the defendant were married until the dissolution
of the marriage. The plaintiff, a teacher, contended that she was the sole owner of some two
properties. The court held that for one of the properties, because there was no evidence to
show that the plaintiff contributed to its contruction, she is not a joint owner with the
defendant but with the second property, it was held that there were joint owners since there
was evidence that the plaintiff contributed to its construction. The court held that the plaintiff
could not be heard to say that she was the sole owner of the properties because of her
occupation put in comparism to that of her ex-husband, a medical doctor. So there was an
implied trust that the second property located at was held in trust by the husband for the
benefit of both of them as joint owners. Though the first house was in the name of the plaintiff,
she held in trust for the defendants children. The court held that the plaintiff held the first house
as a trustee for the defendant inasmuch as the plaintiff herself, before the marriage broke down, freely
acknowledged the defendant to be the owner of the house coupled with the intention of the defendant,
after supplying the purchase money, that he  should remain the beneficial owner of the house. That
intention was indicated by the facts that he kept the title deeds to the house, collected rents and paid
the rates. 
CASE: Kwartreng v. Amassah(father conveying his landed property to his daughter,
implied trust because, the father did not expressly create the trust)

RESULTING TRUST
A resulting trust arises where the owner of property has conveyed it to another person
with the intention of creating a trust, but the beneficial interest returns or ‘results’ to the
transferor because the trust has not exhausted the entire estate. For eg. If a settlor
conveys property to a trustee for the benefit of A for life, then to X on attainment of 21,
but X predeceases A while still under 21 years, then on A’s death, the property will
result to the settlor. Sometimes, a resulting trust is difficult to distinguish from an implied
trust because the intention is only presumed. The difference is that in the case of a
resulting trust, the beneficial interest comes back to the settlor or the peron who
conveyed the property or provided the money for its purchase. This need not be the
case in an implied trust.
CASE: Kwatreng v. Amassah – A father had conveyed his landed property to his daughter.
The evidence showed that this was done only to enable the daughter to obtin a loan from a
bank to complete the buildings on the land.
HELD: That the daughter held the property on a resulting trust in favour of her father. So that
once the loan is paid, the property results back to the father. Consequently, on the death of the
father, the daughter was said to hold the property as an ‘implied trustee’ for herself and all the
beneficiaries named in her father’s will to enjoy the said property.

In both express and implied trust, the intention is implied by equity but with resulting
trust the intention is imposed by equity because equity says it will be
unconscionable for the person who has the interest to benefit as well.
CASE: Re Vandervell’s Trust 1974 CH 269/ 1974 1AE 1947
FACTS: Vandervell, an old wealthy racing car manufacturer was attempting to make a
donation to the Royal College of Sugeons to establish a chair in his name
HELD: Vandervell had not successfully divested himself of ownership (both legally and
equitably) in the shares which he attempted to donate since his trust company had an option to
purchase the shares back from the Royal College of Surgeons. The principle is that if the settlor
– in this case Mr. Vandervell, did not divest himself adequately of his property, and therefore, a
resulting trust would operate
Situations where a resulting trust will arise;
1.A resulting trust automatically arise where there is a failure to exhaust the beneficial
interest in the settlor or his estate.
CASE:Re Vandervell Trust
2.A second situation where a resulting trust automatically arises is where there is a
failure of a beneficiary

There are also a number of situations where the court will presume a resulting
trust;
1.Where the court presumes it will be unconscionable for the person who has the legal
interest to also have a beneficiary interest
CASES: Usher v. Darko
FACTS – The lawyer who had a paramour and bought a property in her name in a resulting
trust for their children. The paramour sold the property but the court held inter alia that since
she held the property in trust for their children, she cannot benefit from it and therefore, the
property will result back to the settlor or the lawyer.

CASE: Kwartreng v. Amassah

FACTS: A father had conveyed his landed property to his daughter. The evidence showed that
this was done only to enable the daughter to obtain a loan from a bank for her father complete
the building on the land. The agreement was that after paying off the loan, the property will
result back to the father. But the father died after while the legal interest of the property still
remained in the daughter. She attempted to eject her half siblings from the buildings on the
land because according to her, she now owned the property.
HELD: That the daughter held the property on a resulting trust in favour of the father so that
after paying off the loan, the property results back to the father. And consequently, on the
death of the father, it was implied or presumed that the daughter held the property as a trustee
for herself and all the beneficiaries named in her father’s will to enjoy the said property

CASE: Cole v. Cole – Read from Library

Presumed Resulting Trust
Presumption of Advancement can prevail over the resulting trust – where the person in
whose name the property is vested is a wife, a son or daughter, and the person who
makes the vesting is a father, then the presumption is that the father intended to make a
gift to the wife, son or daughter. This presumption however, does not favour husbands
CASE: Quist v. George GLR 1975
FACTS: the plaintiff, the then legal owner of a piece of land, conveyed by a deed of gift the
legal and beneficial interests in the land to her daughter who later became the lawful wife of the
defendant, a private medical practitioner.  Some months later, the daughter, as the wife of the
defendant, agreed to mortgage the land to secure a bank loan granted to the defendant. 
Subsequently, the defendant, with the permission and active encouragement of the wife and to
the knowledge of the plaintiff, erected a private hospital on the land at considerable expense. 
This was run by the defendant as a profit-making concern.  Later, the defendant unreasonably
forced the wife out of the matrimonial home.  The plaintiff therefore, at great financial loss,
offered her daughter who had nowhere to go, accommodation in her house which she had
previously rented to tenants. In consideration of this, the daughter by another deed of gift
executed in 1970, reconveyed to the plaintiff the legal title to the land in dispute.  The plaintiff
then sued the defendant husband claiming that despite the hospital which the defendant had
built on the land, he was a bare licensee of the land which licence was granted subject to the
defendant continuing to live with the daughter as man and wife and since they were no longer
cohabiting, the licence had been automatically revoked.

The defendant, however, contended that (a) the deed of gift executed by the plaintiff in favour of
his wife, was made with the sole purpose of creating a resulting trust in his favour and that the
wife was a mere trustee of the land with no beneficial interest and (b) having regard to the
conduct of the plaintiff and to the transaction, and to the fact that his wife had allowed him to
build on the land, both the plaintiff and the wife had intended to give the land to him as a gift so
as to raise the equitable presumption of advancement against them in his favour. He therefore
counterclaimed inter alia for an order compelling the plaintiff to execute a deed conveying to him
legal title to the land.

HELD: It was well-settled that where a husband transferred property to his wife, the
presumption of advancement was applicable. Therefore the onus of proving that no gift
was intended would be on the husband. However, no such presumption would arise
when a wife transferred property in the name of her husband.  Prima facie the husband
would be regarded as a trustee for the wife. Consequently, the fact that the wife concurred in the
erection of the hospital on the land could not be an indication that the wife had intended to give
the land to the defendant as a gift so as to raise the presumption of advancement against her.

b. the deed of gift executed by the plaintiff in favour of the daughter could not be construed as a
trust deed made in favour of the defendant because it clearly transferred both the legal estate
and beneficial interest in the land to the daughter and the fact that the defendant later built
thereon could not raise a presumption of resulting trust or advancement in his favour.  In any
case, the plaintiff as a mother-in-law did not stand in loco parentis to the defendant so as to
raise a presumption that from the transaction a benefit was intended for the defendant; even if
the land had been purchased by the plaintiff in the name of the defendant, no presumption of
advancement would have arisen. 

Both the presumption of advancement and resulting trusts are presumptions and
therefore are rebuttable
CASE: Kwartreng v. Amassah

Articles – woodman & Mensah B – where the holy estate becomes an unholy…

WOODMAN GORDON- PURCHASE BY A HUSBAND IN THE NAME OF HIS WIFE

DEVIOUSNESS OR GENEROSITY? – Whether deviousness or generosity is determined by the
recourse to presumption which arise in certain circumstance and which may be rebutted by
evidence of the actual intention in a particular case.

IN the customary law of conveyancing, documents have limited importance. Even when a
transfer takes effect under common law by a deed of conveyance, customary law may
nevertheless override the words identifying the grantee, so that, for example, a conveyance to
"X" may take effect as a conveyance to the family of which X is head and from whose funds the
purchase price is provided. However, under "pure" common law the terms of a documentary
conveyance are given great respect. Here a deed of conveyance to "X" is both necessary and
conclusive in passing an interest to X. One of the few qualifications to this common-law rule is
formed by the equitable doctrines of presumed resulting trusts. These do not affect the legal
interest, which duly passes to the grantee named in the conveyance, but they can raise an
equitable interest in some other person intended by the parties to take the benefit. Since it is not
uncommon in Ghana to purchase property in another's name, or gratuitously to transfer property
to another, these being the circumstances in which the presumption of a resulting trust arises,
the increasing use of strict common-law conveyancing has produced a line of cases in which
resulting trusts have been alleged to exist. The latest is Ramia v. Ramia.

The plaintiff had purchased a plot of land and had had it conveyed by the vendor to his wife, the
defendant. He had then erected a substantial building in his wife's name. He thereafter
managed and controlled the property. He now sued, arguing that the defendant held the legal
title on a resulting trust for him, and claiming that she be ordered to convey that title to him as
the sole beneficiary. Since there had been a purchase by the plaintiff in the name of the
defendant, the circumstances gave rise to the initial presumption of a resulting trust. The wife
argued that this was rebutted by the contrary presumption of advancement, by which a
man is presumed to intend a gift when he purchases in the name of his lawful wife. (She
seems to have claimed that their children also were beneficiaries, although, since their names
did not appear on the conveyance, there can hardly have been grounds for applying to them the
doctrine of advancement, the sole function of which is to rebut the initial presumption of a
resulting trust and to cause the equitable interest to pass with the legal. The principal issue was
whether the evidence rebutted this presumption of advancement in favour of the wife. The High
Court and the Court of Appeal both held that it did not, and gave judgement against the plaintiff
(Bad law)

Two Ghanaian cases were expressly distinguished. In Kwantreng v. Amassah a father had
conveyed an interest in land gratuitously to his daughter, and in reply to a claim of a resulting
trust the daughter had relied on the presumption of advancement applicable as between father
and child. Her argument was rejected on the ground that the father's total control and enjoyment
of the property proved that there had been no intention of advancement in fact.  The resulting
trust therefore took effect. In Ussher v. Darko a man had acquired property in the name of a
woman, and in reply to a claim of a resulting trust she sought to rely on the presumption of
advancement as between husband and wife. It was held that this could not arise in favour of a
woman who, as in this case, was not the lawful wife of the purchaser.

It is to be expected that frequently all relations between persons married under customary law
will be governed by customary law.  When that is the case there will be no ground to apply the
doctrines of resulting trusts, which are part of the common law as distinct from customary law. 
For example, in Abebreseh v. Kaah, where a man had acquired a house with the aid of
substantial contributions from his customary-law wife, the court considered only the rules of
customary law, and concluded that the parties held the house as customary-law co-owners: the
common-law doctrines were not mentioned. The law seems to be that, as between
customary-law spouses, the law applicable in a property dispute is that which they may be taken
to have intended to govern their transaction in respect of that particular property. If, however, on
this approach it is concluded that the common law generally applies, the rules of common law
may still take into account any specifically customary-law aspects of their conduct.
Anecdotal(unreliable) evidence suggests that, in preference to making wills, people sometimes
acquire properties in the names of their children and other dependants as a means of providing
for them, especially when the law of intestacy is unlikely to meet their needs. Thus an intention
to make a gift may be more probable in Ghana than in England.

CONSTRUCTIVE TRUST
A constructive trust arises by operation of law as distinguished from the act of the
parties. It is a trust imposed by equity irrespective of the intention of the legal owner. It is
imposed when the circumstances are such that equity would consider it to be an abuse
of confidence for the owner to hold the property for his own benefit. An eg. is where a
trustee has made a profit, however innocently, through his office, he would hod the profit
on a constructive trust for the benefit of the beneficiaries of the original trust.
CASE: Dzidzienyo v. Dzidzienyo
FACTS – The Government after re-entering the plots of land leased to E.A. Dzidzienyo for
breach of covenant, again offered the plots to him but he was too ill to accept them and he died
four months later without accepting the offer. The first defendant, administratrix of the estate
of the estate of the late E.A. Dzidzienyo, had the leases granted her by a deed which showed
that she took in a personal capacity.
HELD – That as the leases were granted to the first defendant in her personal capacity solely
because she was the administratrix of the estate of E.A. Dzidzienyo, she held the leases as a
constructive trustee for the beneficiaries of the estate of the late Dzidzienyo, because an
administratrix is not allowed to use her position as such to derive any benefit from the estate.

Because a constructive trust is a trust imposed by equity, there are no prescribed

formalities for its creation. Consequently, in the case of a immovable property, sec 1, 2,
and 3 of the conveyancing decree shall not apply.

There are a no. of situations where the court will presume a constructive trust;
1.Unauthorised profit by a trustee or other fiduciary. In this case, any profit made by the
trustee doesn’t inure to his own benefit but he holds on a constructive trust to other
persons.
CASE: Dzidzienyo v. Dzidzienyo
CASE:Eboe v. Eboe
FACTS: The plaintiff and the defendant are brothers of the full blood. The plaintiff came to
Ghana (then the Gold Coast) in 1928 to trade. In about 1934 he brought defendant from
Lebanon to assist him. In 1942 the plaintiff left for Lebanon, leaving his business, a motor spare
parts shop in Accra, and others at Koforidua and Suhum, in the charge of the defendant with full
powers to run them as he thought fit and to remit the profits to him in Lebanon from time to time.

The plaintiff had wanted to return to Ghana, but he failed to obtain a return visa. The defendant
also had power to operate the plaintiff's banking accounts. Within a few months of the plaintiff's
departure the defendant without the knowledge of the plaintiff sold the business in Accra to one
Salim Sangarri. He also sold the plaintiff's other stores at Koforidua and Suhum, again without
the plaintiff's knowledge.

With the monies realised from these sales, the defendant entered the textile trade and other
businesses. Through correspondence, he gave the plaintiff the impression that he was running
all those businesses on the plaintiff's behalf when the contrary was the truth. In 1960 the plaintiff
instituted the present action against the defendant for a declaration that the defendant holds his
business interests and assets in trust for the plaintiff, an order for accounts and payment to him
of what may be found due.

HELD: (1) on the facts the defendant was a general or universal agent of the plaintiff — an
agency of a fiduciary nature;

(2) such an agency created the defendant a trustee holding in trust for the plaintiff the business
moneys and all other properties which came into his possession or under his control;

(3) on the evidence the business interests of the plaintiff did not cease in 1947 as alleged by
defendant. Consequently the agency and the trusteeship have never determined: they continue
to subsist (5) where a claim is based on a fiduciary relationship, time ceases to run, and the
Limitation Acts do not apply. In the instant case, even though the agency is not created by an
express trust the claims by the plaintiff being claims arising out of a fiduciary relationship are not
statute barred;

(6) as the defendant's present business interests and assets are all the result of an investment
originally made with funds of the plaintiff which the defendant held as a trustee, those interests
and assets continue to be held by the defendant as a trustee for the plaintiff; the plaintiff can
follow and recover them.

CASE: Keech v. Stanford

2.Where third parties receive or deal with trust property knowingly, they will hold such
property on constructive trust in favour of the beneficiaries. Where a third party will only
be held not to be holding the property on constructive is where such a third party is
equity’s darling ie. BNPVWN – Bonafide purchaser for value without notice.
CASE: Selangor United Rubber Estates v. Cradock
CASE: Karak Rubber Estates v. Burden (No.2)(1972)1WLR602 or (1972) 1AER 1210
CASE:Int. sales Agency Ltd v. Marcus (1982) 3AER 555

CREATION OF EXPRESS TRUST

1.Capacity To Create Trust – Generally, the capacity to create a trust is co-extensive
with the capacity to hold and dispose of a legal or an equitable interest in property. It
involves the nemo dat quod non habet rule. Any person or corporation capable at law or
in equity of alienating an interest in property, whether inter vivos or by a testamentary
disposition is also capable of creating a trust covering that interest in property.

2.Formal Requirement – equity does not insist on formalities. Equity does not say that
in creation of trusts, particular formality should be applied. What is important is the
intention to create the trust. in relation to immovable property however, some formality is
required. In immovable prop, where the transfer is done inter vivos, then sec 1 and 2 of
the conveyancing decree must be complied because it involves the transfer of an
interest in land. (which provides that an interest in land shall be by a writing signed by the
person making the transfer or his agent duly authorized in writing, unless relieved against the
need for such a writing by the provision of section 3, without this no interest shall be
conferred)
CASE: Francois v. Bank of West Africa (1958) 3WLR 439
Where the trust is being created by will, then it must comply with the Sec 14 of the
Wills Act 1970

The Three Certainties

Strictly speaking, there are no special requirements for the creation of a trust. equity,
which does not delight in technicalities and formalities, permits great freedom in the
creation of trusts. What is important is the manifestation or expression of an intention to
create a trust. however, in order to conclude that the owner of a property has effectively
manifested an intention to create a trust of it, some requirements must be known to
exist. In Knight v. Knight, Lord Langdale M.R. set out the three essential
requirements of an express trust; certainty of words, certainty of the subject matter and
certainty of beneficiary or object to the trust.
Whenever a trust is being created, whether orally in the case of personal or whether by
an inter vivos disposition under the conveyance decree or in a will whatever mode is
applied, for a trust to be created expressly created, the three certainties must exist;
CASE: Knight v. Knight
FACTS: Richard Knight made a settlement which passed the manors of property down his
family line. The first grandson, of his second son was Richard Payne Knight. He made a will
leaving the property to his brother, Thomas Andrew Knight and to his male descendants. He
added that if there were none, the property was to pass to the ‘next descendant in the direct
male line of his late grandfather Richard Knight. He also added that he trusted the liberality of
his successors reward any others of his old servants and tenants according to their deserts, and
to their justice in continuing the estates in the male succession, according to the will of the
founder of the family, which is his grandfather – Richard Knight. Thomas’s son died early and
Thomas himself died intestate. His daughter, Charlotte married Sir William Boughton. Richard’s
second brother, Edward, had a grandson named John Knight, who brought a claim alleging that
Thomas had been bound to make a strict settlement in favour of the male line. William
Boughton argued that no such trust had been created and the property had gone to Thomas
absolutely and thus on to Charlotte and her family.

HELD: Lord Langdale MR held that the words of Richard’s will were not sufficiently certain but
that meant there had been an absolute gift to Thomas, who had taken the trust unfettered by
any trust in favour of the male line. He formulated the test, known as the “three certainties”.
This test specified that, for a valid trust, there must be certainty of; Intention(there must be an
intention to create a trust), certainty of subject matter and certainty of the objects or people
to whom the trustees are to owe a duty. Judgment for the defendants (Because the words are
not certain and the intention is not clear, the result is that the court says there has been a
transfer of both equitable and legal interest in the property to Thomas to hold as a trustee)

1.There must be certainty in respect of an intention to create a trust

2.Certainty of subject matter
3.certainty in respect of the beneficiaries or objects of the trust

*These three certainties do not apply to constructive, implied and resulting trusts.

1.Certainty of words or intentions – before a trust can be held to have been created, it
must be so clear by the words used by the transferor that he intends to create a trust.
no particular form of words or expression is necessary for the creation of a trust. a trust
can be created by any language which is clear enough to show the intention to create it.
It is however necessary that there can be inferred from the words an intention to create
a trust. if there is no certainty of words in this sense, no trust arises and the done takes
the property as the beneficial owner.
Precatory words which include words of wish, hope, desire and entreaty do not create
trust. In Knight v. Knight, Langdale M.R. stated that a trust could arise if the settlor
‘recommended, or entreated, or wished’ the done to dispose of the property in favour of
another; for, ‘the recommendation, entreaty or wish shall be held to create a trust.
However, the modern attitude is that mere precatory words do not create a trust.
CASE: Gyasi v. Quagraine
FACTS: The testator appointed his nephew the ‘sole heir of his movable and immovable
property and ‘administrator’ of his will. He, however, explained that ‘by administrator, I do not
at all mean to place him conjointly with my four executors, but only to administer also to the
needs and requirements of the members of my household and those of my near relations
abroad in the same way and manner as in life, I would do myself as particularized in my said
will’. He did not define what he meant by ‘sole heir’.
HELD: That no trust was created by the precatory words. The nephew, as ‘sole heir’, therefore,
took the absolute beneficial interest in the properties. It was further oserved that an intended
trust would also have failed for lack of certainty of objects alleged to be benefited were too
vague to make it an enforceable trust.
CASE: Sey v. Sey (1963) 2GLR 220
Facts – A testator gave a house to his brother Kwamin Abadoo and stated ‘my brother Kwamin
Abadoo is not to sell this house for any reason thereby to cause my children to go astray. He is
to look after my children well and live wih them peaceably and quietly as I have been doing. A
contention by one of the children whether Kwamin Abadoo was a trustee of the house for the
children of the testator was rejected by the Supreme Court of Ghana.
HELD: By the SC that what the testator said amounted only to an admonition to the done to
look after his children. The words must, however, be construed in context, including the
relationship of the parties, to ascertain whether the testator intended to create a trust.
CASE: Re Adams and Kensington Vestry – Precatory(wishful) words do not create a
trust
CASE: Asante v. UG (1972) 2GLR 86

2.The subject matter must be clearly described or must be ascertainable from the
description which has been made. If the subject matter is not described, the whole
transaction would be void. For instance, if it is unclear which of the several houses of
the settlor is intended to be the subject-matter of the trust, the trustee cannot be vested
with title to any of them, and the beneficiaries will receive the income from none of
them.
Certainty of subject matter falls into two categories;
i.The corpus of the property must be certain – eg. If you have more than one property,
you have to specify which of the properties you want to create a trust with.
Where a trust fails because there is no certainty in the sub matter, the whole transaction
is void and the property remains in the settlor, the testator or his estate
ii.The interest which the beneficiaries are to take must also be certain – where the
corpus is identified but the interest the beneficiaries are to take is not clear, then the
property remains in the settlor, the testator or his estate
If the corpus can be identified but the beneficial interest is not clear the court can use
the maxims- equality is equity, to ensure that if there are many beneficiaries, then it is
shared among them equally.
In the event that there is only one beneficiary, the court can also say that the entirety of
the property has been vested in the beneficiary since equity looks to the intent rather
than the form
CASES: Gyasi v. Quagraine
HELD: No specific funds were set aside by the testator for his relatives' needs and therefore
the discretion given to the nephew was too wide to be enforceable by any court. 

3.Certainty of Object or beneficiaries – before there can be a trust, there must be a

beneficiary. So the courts have held that with express trusts, the beneficiaries or objects
must be ascertainable without difficulty. A beneficiary need not be an identifiable person.
A trust may be validly created to benefit an object, such as religion or education. The
requirement here is more stringent than the first two – certainty of words and of subject
matter. It is only in charitable trusts that some latitutde is allowed, by which the court
may order that the trust may be applied to the nearest object to that indicated by the
testator. If the beneficiary or object is uncertain, the trust is void and there is a resulting
trust
CASES: Gyasi v. Quagraine
HELD: No precatory trust had been created in favour of the testator's family as the objects to
be benefited, that is his "relatives," "blood relatives" and "people" were too vaguely designated. 
"Blood relatives" is not a term of art, and the testator, formerly an Akan chief, had carefully
omitted the use of the word family which does have a legal meaning (a gift to ‘members of my
household and those of my near relations abroad was held inter alia to be too vague to be
enforceable as a trust)

LESSON 10 – CHARITABLE TRUSTS

It is a trust whose object is to promote the public welfare
What is charity? It more common in the UK than in Ghana
No comprehensive defn.
Charitable Uses Act 1601 – the preamble attempted to indicate a list of charities
CASE: The Interpretation found in the Commissioner of Income Tax v. pg 503
CASE: Scottish Burial Reform & Cremation Society v. Glasgow
From the above authorities, it is clear that for a trust to be charitable, it must fall within
one or four categories; 1.It must be for the relief of the aged, impotent and the poor 2.
The advancement of education 3. The advancement of religion 4.For other purposes
beneficial to the public

1.Relief of The Aged, The impotent or poor –

CASE:Joseph Rowtree Memorial trust Housing Association Ltd v. AG – that the & in the
‘impotent & poor’ is disjunctive and the meaning of the relief.
It has been held that poor is relative
Impotent means – the poor, sick, the blind, etc
And crucially, it must confer a public benefit

2.The Advancement of Education – where a trust is for the advancement of education, it

is a charitable trust
CASE: Incorp. Council of Law Reporting for England & Wales v. AG – held that
education is not limited to teaching but includes any enterprise in which
CASE: IRC v. McMullen – sporting activities where it occurs in a school will be
considered as an advancement of education
CASE: Oppenheim v. Tobacco Securities Trust – for all of these, it must be for a public
benefit – the group of beneficiaries are too constrained – in the case of the BAT- the
class of persons is not sufficiently wide and not a special category of persons so that it
would be considered as a public benefit

3.Advancement of Religion (need not be Christianity) – any monotheistic or religion

which believes in one God – Islam, Christianity, etc. It must be a religion and not just
CASE: Re South place ethical society 1980 1WLR 1565

4.Other purposes beneficial to the community – all manner of things intended for the
public welfare may qualify as a public trust. It includes protection of animals, social and
recreations and hospitals etc
A group with a political objective cannot be charitable
CASE: Mc Govern v. AG – that Amnesty Int is not a charitable trust and must pay tax –
the objective must not be political

The Position Of The Trustee

1.Capacity – Anybody capable of holding an interest in a property is qualified to be a
trustee of that property. So a trustee need not be a natural person but also an artificial
person. A trustee can be a corporate person as well.
In Ghana, there is no limitation to the number of persons who can be trustees. But
clearly, there must be trustees if a trust property must be administered. So clearly, there
is the requirement of a minimum of 1/one

Appointment Of Trustees
First trustees Appointed by the testator or settlor but apart from this power to appoint
the first trustees, a testator or the settlor has no inherent power to appoint new trustees
except this power is stated expressly in the trust instrument.

Appointment of New Trustees

1.New trustees may be appointed by the settlor or testator where this is expressly
stated by the trust instrument

2.Additionally, the courts have an inherent jurisdiction to appoint new trustees. Where
upon application the court thinks a new trustee must be appointed, the court has the
power to do so

3.Under the Trustee Act 1861, the remaining trustees may appoint new trustees where
there is no contrary provision in the trust instrument

The Vesting Of Trust Property

To enable the trustees to carry out their obligation and to .. the property in the trust must
be vested in the trustees. Ie. The trustee must take ownership and possession of the
trust property. The precise way in which the property has to be vested depends on the
nature of the property – movable property or immovable property.

Where the subject matter is immovable property, there must be a written conveyance to
the trustees. Or it must satisfy secs 1 and 2 of the conveyancing decree

Where the trust is being expressly created, then the trust instrument must guide it, buy if
it is by a will then the vesting assent should guide it - by the executors and
administrators

The courts have an inherent jurisdiction to make a vesting order if it is impossible to

make the ve

Duties Of Trustee
Once a person becomes a trustee, a number of duties are imposed on him or her.
1.First, he or she must acquaint himself with the terms of the trust instrument – the will,
the particular provisions, the SNNIt Act, etc

2.Ensure that all the trust property is vested in the trustee or in the joint names of the
trustees and that all title deeds are placed under their joint control
CASE: Lewis v. Nobbs

4.Where new trustees of an existing trust are created, you must investigate any
suspicious circumstances which indicate that there might be a prior breach of trust and
to take action to recover any breach property and to recover any property if any breach
has taken place

5.He must take custody of the trustee property

-In the performance of all these duties, the trustee must act as a reasonably prudent
man of business. He must exercise due diligence as a reasonable man will exercise
over his own affairs
-In the exercise of this standard of care, the trustee must perfect any imperfection in the
trust eg. Registering any landed property which has not been registered

-He must also take action to recover any debts

-And failure to observe these standards is a breach of trust.

The Duty Of Investment

A trustee is under an obligation to invest the trust in proper securities so it will earn
interest or profit. This is an implied obligation. It is not necessary that the trust Act
should expressly provide it before it is done. And a trustee who does not invest is in
breach of trust and will be liable to pay what would have accrued as interest if he had
invested

Areas For Investment Circumscribed By Law

Three areas are permissible;
Under the Trustee’s Act 1860 – statute of general application, a trustee can only invest
in government securities and public bonds or any other area permissible under the trust
instrument. A trustee who goes beyond these areas is in breach of trust

Note that though investment outside these areas will constitute a breach of trust, if no
losses are no occasioned by investment outside these areas, then it will be permissible
but if there are losses occasioned by an outside investment, then it is not permissible.

The duty to invest applies to both moveable an immoveable property. And you must
make sure that the trust estate benefits as much as possible

If the trustees grant loans, they must take proper security or collateral. If they do not
take proper care and loss is occasioned, they are liable.

The Duty To Act Impartially

Trustees are to hold the wheels of justice evenly as between the beneficiaries. The
trustee must not take any action which will be to the disadv to any of the beneficiaries.
Unless expressly provided, the beneficiaries will hold in equal share – equality is equity.
Eg. If you have children of varying ages – some of whom are very old an dsome of
whom are very young, the requirement to act impartially as between the beneficiaries
requires that u must manage the trust so that all the children benefit equally. This may
mean that you have to deny some of the children some things – eg. The older one may
be doing very well. And the amount of money may be small. So for instance if taking the
older one to school will mean that there will be no money left for the other children, what
happens? – all the children irrespective of age, must get the same thing.

The Duty To Keep Account

The trustee is under an obligation to keep proper account of the estate. Under a duty to
provide information when the beneficiaries make reasonable request for this info (duty
to the trustees and right to the beneficiaries). A trustee who fails to keep proper account
and provide this account when they make a reasonable request for it will be in breach of
trust.

The Duty Not To Profit From the Trust

A trustee must not profit from the trust. a trustee who benefits from trust is in breach.

Duty To Act Without Remuneration Or Payment

A trustee must act without renumeration from his duties. Generally, equity requires that
a trustee must perform his duty gratitiously. What a trustee is entitled to is actual
expenses incurred during the care of the trust
Exceptions
1.Where there are expressly provisions in the trust that the trustee must benefit
2.Order of a court – the court has an inherent jurisdiction to order renumeration for the
trustee
A court can also order an increase in the level of renumeration.
3.Agreement with the beneficiaries - Where the beneficiaries are of sound mind and
matured age ie above the age of majority and agree to that the trustee should be paid,
then that is possible. But such agreement is regarded suspiciously by the court

Duty Not To Derive Indirect Benefit from His Position As A trustee and from his
administration of the Trust Estate
So if he indirectly benefits from his position, it will be considered breach of trust
CASE: Keech v. Stanford
CASE: Williams v. Barton
The general position is that if he is benefitting solely on account of his position as a
trustee then he cannot benefit but holds it in trust for the beneficiaries.

Duty Not To Purchase The Trust Property

Unless there is clear and express and unambiguous provision or prior authorization by a
court, a trustee cannot purchase a trust property because his duty as a trustee will
conflict with his duty as a purchaser. – because he is to look out for the highest bidder
but if he is to purchase, he may not necessarily be the highest bidder (conflict of interest
position)

Where the trustee buys the trust with the consent of the beneficiaries, there is no
breach though the courts views such arrangement with suspicion.

A trustee must not to benefit but any charges which are incurred by the trustee in the
reasonable care of his charge, he must be reimbursed - expenses cost, charges must
be paid out of the trust estate first before – the trustee have to reimburse themselves
first before the be

Duty Not To Delegate

Because the duty is that of a trustee, the court views that he must not delegate because
his position is one of a trust relationship between him and the testator. He cannot give
his position to another who may not be trusted. If the trustee does not want to act as a
trustee he can … but he cannot delegate his functions to others.

Exception
In the practical world, the courts have held that where expertise are required, then the
trustee can delegate. Eg. If the trustees are not lawyers, and there is an issue for
interpretation, obviously, he can hire a lawyer to ensure that a proper interpretation is
done. An accountant for instance to keep proper account of books. Stock brocker to do
the investment. But the courts have held that even in choosing these agents, a trustee
must exercise proper care and general supervision like a reasonable prudent man of
business would do.

LESSON 11 – POWERS OF TRUSTEES

From the general law, powers of the trustee may be derived from the express provision
in the trust instrument or inferred by the court by the nature of the trust or by what a
reasonably prudent man will do

1.The Power Of Sale

The power of sale may be expressly provided for or it may be implied.
Implied – the rule in darkmon
When it is expressly inferred, it may be one or two types;
i.It may confer a right on the trustee to sell – so you can have a trust for sale
In this situation, trustees are not given a duty to sell but rather a right to sell which they
may exercise or not exercise
ii.Duty to sell – Where there is a duty to sell, failure to sell is a breach of trust. But if it is
just a right, then failure to sell is not a breach of trust
However the power of sale is derived, in the exercise of that power, the trustee must
seek to get the best bargain so that where it can be shown that for personal or
extraneous deal, the trustee has not acquired the best or the highest price, this
constitutes a breach of trust and the trustee is liable to pay the difference in the price

-Mode of SALE
A trustee may sell through a public auction or a private treaty/arrangements– sec 1 of
the Trustee Act. But the preferred mode by the court is a public auction
Where the property has been sold and the buyer has paid for it, or the property has
been sold bonafide, the buyer has paid for it, receipts has been given, it means that it is
not the responsibility of the purchaser what the trustee or trustees subsequently does or
does not do with the money.

2.The Power To Insure

Generally, there’s no duty to insure but depending on the circumstances a duty to insure
will rise. And a power to insure may expressly be provided for.
CASE: Khoury v. Jojo

3.The Power To Compound Liabilities

This means the trustee has the power to make compromises, may postpone the
payment of certain debts, may submit matters to negotiation or arbitration. In doing all
this, the trustee must act in the best interest of the trust estate and the beneficiaries.
Here, we are talking about active management of the trust.

4.Powers of Maintenance
The power of maintenance simply means that the trustees have the power to maintain
the beneficiaries even if this is not expressly provided for and therefore for eg a trustee
who is required to hold on to a property in trust to give it to the beneficiaries when they
attain 25, then the trustee has the power to maintain the beneficiaries until they attain
that age. So the trust instrument may not expressly state this power of maintenance but
the trustee is impliedly required to do so.
Maintenance means periodic payments taking care of beneficiaries

5.Power of Advancement
Advancement is the provision of lump sum to set up the beneficiary. This may also be
implied. Advancement unlike maintenance is anything that the trustees would do to
advance the beneficiary or to set them up in life. Unlike maintenance, advancement will
be a lump sum. Eg. Money to start a business, money to buy a car, money to buy an
office to start law practice. Anything that will set up the beneficiary in the future.

Breaches of trust
1.Generally, a trustee will be in breach of trust if he does not comply with the general
law or what is expressly stated in the provisions of the trust instrument
2.Omissions or failing to do what is required by the general law or the express
provisions of the trust instrument will also be a breach
3.Not achieving the standards expected of a trustee or that which a reasonable prudent
man of business in the management of his or her affairs would have done will amount to
a breach. This is an objective standard

Fraud is irrelevant. So once all the above points are satisfied then the trustee will be in
breach of trust irrespective of whether the trustees acted in good faith or bad faith ie
fraudulent or not ie bona fide or mala fide or not

There can be unintentional breaches of trust. so for instance where the trustee does not
achieve the standards (point 3..

Liabilities of Breaches of Trust

Liabilities is personal and not vicarious. So when there are several trustees, a trustee is
only liable for his own acts or omissions. But if a trustee is inactive or negligent or sits
by while the other trustees break the trust then this trustee might be liable and for this
reason a trustee who retires is not liable for any breaches of trust which may occur after
his or her retirement

The Measure Of Liability

The objective of this area of the law is to make sure that the beneficiaries do not suffer
any loss and therefore the aim for the measure of liability is to compensate the
beneficiaries for any actual loss directly or indirectly caused to the estate. This means
that though there may be a technical breach, if no loss is occasioned to the estate, there
is no liability. So for instance the law says do not invest in piram but u go and invest it
and u get 100% interest, the law will say thank u. but if u invest and u lose the trust
money then u have to pay for it
The rule is so harsh that it says that u cannot offset a loss in one transaction with a
benefit from another transaction.
CASES: Perrins v. Bellamy, Fry v. Fry, Re Emmet’s Estate

The Liabilities of Tustees Among Themselves/Inter se

Liability is personal and not vicarious but where two or more trustees commit a breach
of trust, as far as the beneficiaries are concerned, their liability is joint and several. This
means that u can sue all of the defaulting trustee or some of them or u can recover
judgment on all or some of them. A trustee who ends up paying more than his fare
share, is entitled to indemnity from the other defaulting trustees.
CASES: Bahin v. Huhes, Head v. Gould

Liability of Beneficiary-Trustees
Where the trustee is a beneficiary, or a trustee who is also a beneficiary of the trust,
then the measure of the liability is that the beneficiary- trustees must contribute towards
the loss first, so that if there is an outstanding balance, then the other trustees will
pay….
The reason is that;
1.Maybe, being a beneficiary as well will make him have more influence on what should
be done or not to be done
2.Volutary non fit injuria
CASES: The rule in Chilingworth v. Chambers, Head v. Gould

Defenses In Breaches Of Trust

1.Acquienscence or release by the beneficiaries – where the beneficiaries acquiesce
in the breach or release the trustees from the breach, then this would be a defense to
the action for breach of trust. So by their nature, it must come after the breach has
taken place. For acquiescence or a release to be a defense;
i.The beneficiaries must have full capacity – of age, and of sound mind
ii.They must have full particulars of the breach in relation to which they have
acquiesced. The beneficiaries must be in full possession of the facts. If the trustees
have concealed the breach, then this will not be a proper acquiescence or release. The
acquiescence or release may be expressly done or must be implied by the conduct of
the beneficiaries. It must not be done by duress or any other vitiating factor

2.Consent or participation by the beneficiaries – this is before or contemporaneous with

the breach in question. Where the beneficiaries consent to the breach, then they cannot
turn back and complain.
i.This consent or participation must be by beneficiaries who have capacity
ii.They must have full knowledge of the fact
iii.They must have absolute freedom in taking the decision or participate in the breach
of trust.
If any of these is lacking then it not proper consent or participation.
Where there are several beneficiaries some of whom participated and consented, some
of whom did not, then the defect will only lie against those who consented and
participated or in the first point, those who acquiesced.
CASE: Re Pauling’s Settlement Trusts 1964 CH 303
The trustee of family settlement succumbed to the pressure of the father to make
advancements to his children, which in reality were not advancements at all: the money was
not intended to benefit the individual children but to defray the family’s extravagant living
expenses, including the cost of purchasing family homes. The children, although of full age,
were not taken to have consented because, although they were aware of the true puposes of
the advancements, the court held that their approval was procured by the undue influence of
their father. The fact that several children received benefits to themselves from the
advancements did not bar them from claiming against the trustee for breach of trust, although
they did have to offset these benefits afainst their claim against the trutee to restore the trust
fund.
HELD: That to truly consent, a beneficiary must be fully aware of the facts, although not
necessarily of his legal rights. Lord Wilberforce put is more clearly that the court has to consider
all the circumstances with a view to seeing whether it is fair and equitable that, having given his
concurrence he should afterwards turn round and sue the trustees. It is not necessary that he
should know that what he is concurring in and that it is not necessary that he should himself
have directly benefited by the breach of the trust.

3.Lapse of time – Limitation decree, 1972(NRCD 54), Sec 15 and sec 22

Sec 15 – The period of limitation is 6 years. You must bring your action within 6 years or
your time will lapse.
Sec 15(4) – Exception is where there has been a fraudulent breach of trust or where the
claim is to recover property or converted the property to another use, this 6 years period
of limitation in sec 15 will not apply
Sec 22 – Fraudulent breach; where there has been fraudulent breach of trust or
fraudulent concealment of trust, then the limitation will not apply unless after the
concealment has been discovered or should have been discovered by the beneficiary

4.Where the trustee is Bankrupt/Insolvent – where a person has become insolvent and
has been declared so under the Insolvency Act Sec 34, then this is a defence. So you
sue him but he says that he has been declared by the Rep of Ghana to be broke, then
that is a defence.

LESSON 14 – REMEDIES
Tracing of Trust Property
It is an equitable remedy which defies some things known in equity. It is not right in
personam. This remedy operates in rem ie. Directed at the trust property or any
additions or accretions to the property or any new forms which the property may have
taken if that property may have been acquired with the trust asset
CASE: Re Diplock
The CL had a remedy which was called Following. So at CL, if your property is in the
hands of somebody else, you can follow it if you can find it with the person. The disadv
of this remedy is that as Re Diplock puts it “it stopped at the door because;
i.It was not used to where the property had been mixed with other funds or other assets
ii.or if it has been converted into something else
Re Diplock says that the CL adopted a materialistic approach in dealing with the
property. It stops at where the property is clearly identifiable or where the property has
not been mixed. Eg. A trustee putting trust money in his own account or using trust
money to purchase shares, which is unidentifiable.

This is why equity developed Tracing which defeats the principle of equity which says
that equity acts in personam

For the beneficiaries to be able to trace, three conditions must be present;

1.That the property must be traceable
2.There must be an equity to trace
3.That tracing must not produce an inequitable result
CASE: Re Diplock

1.The property Must Be Traceable – There cannot be tracing where the property is lost
or squandered. So if there is nothing at all, then you cannot trace ie. If the nature of the
property has been changed such that it cannot be traced, then there is no tracing. So
there must be some property for u to apply for tracing.
Where the property is exists, then there is no problem. Where the property has been
mixed equity says the property is for the beneficiary, the onus will therefore be on the
trustee to prove that he has his property mixed with the trust funds. Re Diplock says this
is the principle. Re Diplock says they are not rules but rather the overriding principle is
that what will be the best interest of the trust estate and the beneficiaries?

Before Re Diplock, there were other rules which said that the rules override what is in
the best interest of the trust estate or the beneficiary
CASE: The rule in Clayton’s case – says first in first out. Developed in the court of
chancery. So if the trustee mixes trust assets with his own funds, the question is which
one is trust money and which is the trustees, it is said that the monies are taken out
according to the manner in which they were put in. the court of chancery operated with
this principle until 1880 in Re Hallet’s Estate

CASE: In Re Hallet’s Estate the court says that there ought to be a presumption against
breaches of trust and that on the facts of this particular case, the court of chancery
developed a new princ which says that trustees are presumed where the trust property
has been mixed not to withdraw the trust money and has rather withdrawn his own first
and what is left will be the trust fund. That u don’t take trust money until u have finished
taking ur own. This rule operated until Re Oatway
CASE: The rule in Re Oatway – that if you take out money which u invest and yields
profit, then it is trust money which u have invested. Because u should not even mix trust
money with your money. This operated until Re Diplock which says that if you mix the
funds and you take some out and invest it. It yields some profit. Then the beneficiaries
can trace the stock and take the higher money that has accrued. The moral here is that
trust money should not be mixed with personal funds. This remedy goes beyond the
situation where the property is not identifiable. The principle here is what will be in the
best interest of the estate and the beneficiary

2.There must be an equity to trace. For this remedy to apply, there must be a fiduciary
relationship between those applying and those against whom they are applying. So if
you only have a CL right, then the equitable remedy of tracing will not be available to
you.

3.Tracing must not produce inequitable results. So you must satisfy the applicant for
tracing and the conscience of the court. Tracing will not allow hardship to be done to
anyone interested in the property. Eg. Tracing will not be available to a person where
there is a BPFVWN. Again, it will not be available where the beneficiaries have
acquiesced in the actions of the trustees

Effects Of Tracing
The successful claimant becomes entitled to the property. The claimant takes the
property in the form he finds it plus interest in the new form.
In relation to unmixed funds or assets, the successful applicant can adopt the breach of
trust and take the new property or asset or if they don’t like the new property, they have
a charge on it. Eg. If the property is in a residence that you don’t like, then you can
advocate that the property be sold and the moneys given to you.

Where it is mixed funds, then it’s more difficult. In this case, then the beneficiaries may
have to show what proportion of the trust funds has gone into the new form of the
property. And then, once you trace, you take a proportionate portion of the new asset.
Proportionate to the trust asset that went into it. The onus is on the trustees to show that
their funds have been mixed with the trust fund and where they fail to prove that onus,
then the court will hold that there has not been any mixing of funds. (the major and first
responsibility of proving is on the fiduciary)

Tracing and Third Parties

If the third party is a BPVWN, then he or she would not be affected by tracing. Where
the purchaser purchases with notice of the interest of the beneficiary, then he would
have bout the legal interest subject to the equitable interest of the beneficiary.
CASE: Usher v. Darko
Ways in which the trustee relationship may come to an end/Determination of
trusteeship
There are four ways;
i.Disclaimer
ii.Retirement
iii.Removal
iv.Death

i.Disclaimer – this means that the person refuses to accept to act as a trustee. So
anytime after your appointment but before your acceptance, you can disclaim. But once
you have accepted, you cannot disclaim. This way, you don’t assume the office at all.
Where a person is appointed as an executor and a trustee, then acceptance of the
position of the executor necessary mean that you have also accepted to act as a trustee
Acceptance may be by conduct. But this is a matter of fact for the determination of the
court. A disclaimer of the trust also means that you are refusing the transfer of the trust
property to u and the trust estate will then revert to the estate of the testator.

ii.Retirement – This means a situation where the person accepted the position of a
trustee but somewhere down the line, he cease to be by voluntarily retiring.
This(retirement) may occur in a number of situations;
a.where it is expressly stated in the trust instrument. This is rare
b.With the consent of the beneficiaries they having the requisite capacity
c.By an order of the court where the trustee applies to retire

iii.Removal – this is a situation where the trustee is forced out. The courts have an
inherent jurisdiction to remove a trustee
CASE: Letterstedt v. Brooers
CASE: Re Wrighton
Additionally, under sec 11 and sec 2 of Trustee Act 1860, the court has power to
remove the trustee in certain circumstances.
-too sick, -refusal to act, -or where he is absent in the jurisdiction for a continuous period
of more than 12 months. This are the situations where an application is made usually be
the beneficiaries to the court for the trustee to be removed. In the case of retirement and
disclaimer, the trustee himself has the right to decline to be a trustee.

iii.Death – where a trustee dies, he or she ceases to be a trustee. Where a trustee dies,
then the property devolves to the next trustee. Where the last or sole surviving trustee
dies, then the position devolves to the personal representative of the last surviving
trustee. Where the personal reps rejects or disclaims the position, then new trustees
may be appointed either by the court in the exercise of their powers under the Act or in
the exercise of the inherent jurisdiction that they have.

LESSON 9 – MORTGAGES
The Mortgages Act 1972 NRCD 96. Came into force on 1 st Jan 1973. Before then, the
English law was used.
The Home Mortgage Finance Act 2008 Act 770
The Borrowers and lenders act 2008 Act 773

Before 1st Jan 1973, a mortgage was defined as a conveyance of land or an

assignment of chattel as security for the payment of a debt or the discharge of some
other obligation for which it is given
CASE: Santley v. Wilde – defn applies to land and chattel ie. Movables and immovables
FACTS: The plaintiff, Miss Kate Santley being the sub-lessee of the Royalty Theatre and having
an option to acquire the reversion of the head-lease on paying 2000 pounds within a limited
time, borrowed that sum of the defendant – Wilde, mortgaging the theatre. The plaintiff paid
the installments in arrears and within the 3 months tendered the balance with interest to the
end of the 3 months and costs but Wilde – the defendant refused to accept the money. (Miss
santley mortgaged her theatre for a loan, upon repayment, the defendant refused to accept the
money. The plaintiff sued)

HELD: By Lindley M.R. that that the true principle running through the case is this – that a
mortgage is a conveyance of land or an assignment of chattels as security for the payment of
a debt or some obligation for which it is given. That this is the idea of a mortgage and the
security is redeemable on the payment or discharge of such debt or obligation. Any provision
inserted to prevent redemption on payment or performance of the debt or obligation for which
the security was given is what is meant by a clog or fetter on the equity of redemption and
therefore void. It follows from this that “once a mortgage, always a mortgage”.

Under the Ghanaian law sec 1(1) of the mortgages act defines a mortgage as a
contract charging immovable property as security for the due repayment of a debt and
any interest accruing thereon or for the performance of some other obligation for which
it is given

Differences – Ghanaian Law: contract, and immovables(mortgage is simply a security

and does not per se change ownership)
English Law: Conveyance, immovable property and movables

A mortgage under Ghanaian law does not operate so as to change ownership, right of
possession or other interest whether present or future in the property mortgaged except
as otherwise provided by the Act – Sec 1(2) of the Mortgages Act ie. A mortgage does
not operate as to change ownership of the property. The mortgagor still has rights of
possession over the property. The mortgagor can still mortgage the property to another.
He can even rent it. It is when the mortgage is defaulted that his rights can be tampered
with eg. through sale of the property

A mortgage may be created over any interest in immovable property which is alienable
eg. It may be created over a freehold interest, a leasehold interest, an assignment, a
sub lease, etc. the interest may be legal, equitable or customary. The mortgagor must
have the capacity to create a charge over the property before he can create a mortgage
over sale ie. You must own the property before you can mortgage it

Sec 2 is to deal with business men who seek to outwit a party to an agreement. Sec 2
of the Mortgage Act provides that “Every transaction which is in substance a mortgage
of immovable property whether expressed as a mortgage, charge, pledge of title
document, outright conveyance, trust for sale on condition, lease, hire purchase,
conditional sale, sale with the right of re-purchase or in any other manner shall be
deemed to be a mortgage of immovable property and shall be governed by the Act”

One of the essence of every mortgage is the element of redeemability ie. The property
must be redeemable or the mortgagor must have a right to redeem his property upon
repayment
CASE: Noakes v. Rice – the court said that redemption is the very essence and nature
of a mortgage. A mortgage cannot be irredeemable
FACTS: A mortgage of a leasehold public house contained a covenant with the mortgagee, a
brewery, that the mortgagor and his successors in title would not, during the continuance of the
leasehold term and whether or not any money should be owning on the security of the
mortgage, sell malt liquor in the public house other than that purchased from the brewery.
HELD: That the covenant contained in the mortgage by which the mortgagees have attempted
to convert the house mortgaged from a free public-house into a tied public-house even after
redemption, is invalid There is no reason that upon payment off of the mortgage money, the
mortgagor cannot get back what he mortgaged, namely, a free public-house. That equity will
not permit any device designed to prevent or impede redemption.

CASE: Seton v. Slade – once a mortgage, always a mortgage and a mortgage must be
redeemable.

Sec 14 of the mortgages Decree – Where the performance of an act secured by the
mortgage is illegal, or derives from a contract which is illegal, the mortgage shall to that
extent, not be enforceable (ie. Where a mortgage is secured by an illegal act, that
mortgage is to the extent of the illegality, void)

CREATION OF MORTGAGES
A mortgage can be created in 3 ways; legally, equitably or customarily

Legal Mortgages – Pre 1973 – Before then, the law drew a distinction between the
creation of a legal mortgage, of a freehold and that of a leasehold interest. With respect
to the freehold interest, the creation of a mortgage of a freehold land involved the
conveyance of the mortgagor’s title in the land to the mortgagee with a covenant by the
mortgagee to reconvey the property to the mortgagor on redemption

With respect to leasehold lands, a legal mortgage may be effected by way of

assignment of land to the mortgagee or by granting a sub lease to the mortgagee with a
proviso that the sublease or assignment will cease on redemption
1.How Are Legal Mortgages created Today? – Sec 3(1)(a) of Mortgages Decree
That it must be in writing and it must be signed by the mortgagor or his authorized agent
authorized in writing to sign on his behalf and registered. The mortgage becomes legal
only when it is in writing otherwise it still remains equitable. The Lands Registry Act
provides that every interest affecting land must be registered which will then make it
legal else, the interest remains equitable

2.Equitable Mortgages – an equitable mortgage is not in writing. Eg. Is the deposit of

title deeds without more among others – Sec 3(1)(b)
Sec 3(1)(b)&(c) – an equitable mortgage may be created when the need for writing is
excused by the operation of the rules of equity including the rules relating to fraud,
duress, hardship, unconscionability, part performance or by an enactment or in the case
of a customary law transaction.

3.Customary Mortgages – usually in the form of pledges

Sec 3(1) (c) – a mortgage shall be enforced if it is excused from the necessity of a
writing by any enactment, in the case of a customary law transaction

MORTGAGOR’S EQUITY OF REDEMPTION

Equity of redemption is the right that the mortgagor has to recover or reclaim her
property on the performance of the act secured by the mortgage. The equity of
redemption is a collection or bundle of rights which may be summed up in the maxim
“once a mortgage, always a mortgage”. The mortgagor’s equity of redemption is
inviolable
CASE: Khoury v. Mitchual – the mortgagor’s equity of redemption is inviolable

Equity of redemption is a proprietary interest in land. You can transfer that right to
another person, it is not a personal right but rather a right attached to the land

Why the Mortgagor’s equity of redemption?

At CL, once the mortgagor defaults, he loses his property. But after a while, people
started appealing to the king. Once it is not an outright sale and once the mortgagor
gets into the position to repay, he should be able to redeem his property.

The Bundle of Rights of the Mortgagor’s equity of redemption;

1.There should be no clogs or fetters of the mortgagor’s equity of redemption. The
principle is that a mortgagee must not attempt to exclude the right to redeem. Hence,
equity will not permit an option to purchase the mortgage property contained in the
mortgage deed even if the option constitutes a perfect bargain
CASE: Samuel v. Jarrarh Timbers & Wood paving Co Ltd 1904 AC 323

An option to purchase the mortgage property may be valid if granted after the mortgage.
In making the assessment, the court looks at the nature of the bargain to determine
whether the specific clause is a clogg or not and whether any such option to purchase in
the mortgage deed is independent of the mortgage transaction
CASE: Reeves v. Lisle 1902 AC 461

2.There should be no unreasonable postponement of the mortgagor’s right to redeem

his property. Generally, the right to redeem may be postponed unless redemption
becomes illusory/mirage or the term is oppressive
CASE: Fairclough v. Swan Brewery Ltd – the 20 year postponement period was
unreasonable. This is because generally the courts look at the strengths of the parties
involved. Where one is an indiv and the other is a company, the courts looks to favour
the individual
CASE: Knightbridge Estate v. Byrne – the postponement of 40 years between two
commercial entities acting at arm’s length was reasonable

LESSON 12 – CONT. OF MORTGAGOR’S RIGHT OF REDEMPTION

3.Redemption must be free from collateral advantage or conditions. A Collateral
advantage is an agreement contained in the mortgage which does not relate to the
mortgage but confers some advantage on the mortgagee.
The principle is that a mortgage may contain terms which gives the mortgagee some
advantage in addition to his security. If the collateral advantage is neither
unconscionable nor in restraint of trade, they are enforceable if designed to cease with
redemption (ie. collateral adv must cease with redemption)
CASE: Biggs v. Hodinott
CASE: Voakes v. Rice

Beyond redemption, such an advantage may only be upheld if it is independent of the

mortgage agreement
CASE: Krelinger v. New Patagonia Meat and Cold storage

4.The terms of the mortgage must not be oppressive or unconscionable

CASE: Cityland & Property Holding Ltd v. Debrah
The Loans Recovery Act of 1918(CAP 175) Sec 1 – the courts have been given the
power to reopen transactions where the transaction is harsh and unconscionable or is
otherwise a transaction in respect of which a court of equity would give relief
CASE: Mensah v. Ahienfie Cloth Sellers Asso (2010) SCGLR 680

However unconscionable or harsh the terms of a mortgage may be, some may be
allowed when businessmen are dealing at arm’s length
CASE: Multi service book binding Ltd v. Marden

5.Where it is provided for in the mortgage agreement, the mortgagee may alter interest
rates provided that he does so in good faith for valid commercial reasons and not
for dishonest or improper purposes (ie. The lender reserves the right to review the
interest rate)
CASE: Paragon Finance Ltd v. Nash

It is possible in some circumstances to lose this right to Review The Interest Rate;
i.when there is a judicial sale, you lose your right to review the mortgage
ii.When there is a 12years adverse possession of the property – Found in NRCD 54
sec

The Right Of The Mortgagee In The Event Of Default

1.The Right to sue on the personal covenant to perform –
SEC 6 of the Mortgages Act – A mortgagor is personally liable as well as liable on the
mortgage security unless a contrary intention appears (ie. Once judgment is obtained against
him, any property of his may be sold in satisfaction of the debt)
SEC 32 Borrowers & Lenders Act - (1) Where a borrower fails to make payment on the
due date for a payment, the lender shall give notice of default to the borrower in writing and
request the borrower to pay the amount due within thirty days.
Home Mortgage Finance Act
Also when after the sale of the mortgaged property, and the proceeds realized are not enough
to satisfy the debt, the mortgagee may be sued on his personal convenant

2.Sale – The Mortagagee has a right to sell the Mortagor’s property. You cannot sell the
property by yourself but by an order of the court
SEC 18 of the Mortgagees Act – The mortgagee may make an application for an order
for the judicial sale of the mortgage property. The judicial sale may be by a public
auction unless the mortgagor and all subsequent encumbrances agree to a private
treaty and the terms of the mortgage treaty are approved by the court (this will foster
transparency)

Sec 18 (6)– provides that a mortgagee who requests for a judicial sale as well as other
encumbrances may purchase the property at a judicial sale provided that the terms of
the purchase has been approved by the court.
The effect of a judicial sale is that the purchaser takes it free from all subsequent
mortgagees. And the right to redeem is lost or destroyed
CASE: Tetteyfio v. Awuku (1955) 14WACA 723

Sec 18(11) – sets out the order in which payment is to be made from the proceed sale.
1.All expenses incidental to the fee. Eg. Auctioneer fee

2.All sums secured by the mortgage – the person who brought the action has to be paid
all the amounts owed him. After he’s been paid, all subsequent mortgagees in order of
priorities. And any balance left is paid to the mortgagor or to his successor in title

Situations Under The Borrowers And Lenders Act 2008 *Sec 32 – 35 of the B&L
Act
This applies to borrowing and lending
1.Give the required notice for mortgagee to pay
2.Register collateral at collateral office
3..BoG will give you a notice
4.Serve notice on mortgagor
Once you satisfy these conditions, you can sell the mortgage without any court order
Enforcement of borrower’s obligations

Default in payment
32. (1) Where a borrower fails to make payment on the due date for a payment, the lender shall
give notice of default to the borrower in writing and request the borrower to pay the amount
due within thirty days.
(2) The lender may send the notice by
(a) hand, (b) courier service, (c) registered mail, or (d) other means determined by the lender in
consultation with the borrower.
(3) Where the notice is delivered
(a) by hand, it shall take effect on the date it is received by or on behalf of the borrower; and
(b) by courier service or registered mail, it shall take effect on the day it is officially recorded as
delivered by return receipt or its equivalent.
(4) If a borrower fails to pay or make satisfactory arrangements to pay the amount outstanding
to the lender within thirty days after the date of receipt of the notice, the lender may enforce
the rights provided for under this Act.
Remedies of lender on default
33. Where a borrower fails to pay an amount secured by a charge under this Act,
the lender may
(a) sue the borrower on any covenant to perform under the credit agreement, or
(b) realise the security in the property charged on notice to the person in possession of the
property.
Lender’s right to possession
34. (1) In the exercise of right of possession of property that is subject to a charge to secure a
borrower’s obligations under a credit agreement, a lender is not obliged to initiate proceedings
in court to enforce the right of possession.
(2) Where a lender is unable to enforce a right of possession in a peaceable manner, the lender
may use the services of the police to evict the borrower or other person in possession pursuant
to a warrant issued by a court.
(3) A person who
(a) fails without reasonable excuse, to vacate premises being foreclosed by a lender under
subsection (1) when duly requested to do so, or
(b) obstructs a lender in the lawful exercise of power conferred on the lender by this section,
commits an offence and is liable on summary conviction to a fine of not more than five hundred
penalty units or to a term of imprisonment of not more than six months or toboth; and in the
case of a continuing offence, to a further fine not exceeding fifty penalty units in respect of any
day on which the offence continues.
Mortgages
35. (1) The Mortgages Act, 1972 (NRCD 96) does not apply to the rights of a lender under this
Act in the event of default on the part of a borrower.
(2) Where there is a conflict between the provisions of this Act and the provisions of the
Mortgages Act or other laws or rules applicable to the enforcement of a lender’s rights, the
provisions of this Act shall prevail.

Sec 35 of the B and L Act provides that once there is a conflict between the borrowers
and lenders Act and the Mortagees Act the B&L Act shall prevail. It also states that the
right of the mortgagor as captured in the Mortagees Decree shall be inapplicable
Mortgages
35. (1) The Mortgages Act, 1972 (NRCD 96) does not apply to the rights of a lender
under this Act in the event of default on the part of a borrower.
(2) Where there is a conflict between the provisions of this Act and the provisions of
the Mortgages Act or other laws or rules applicable to the enforcement of a lender’s
rights, the provisions of this Act shall prevail.

Sec 20 of the Home Mortgage Finance Act, says that a mortagee may exercise the
right of sale without recourse to court and the sale may be by public auction or private
contract. All that is required is that the mortagee must give the mortgagor notice of
default and require him or her to make good of the indebtedness and he can exercise
right of sale without recourse to court.

3. Appointment of A Receiver – Sec 16 of the Mortgagees Act, Sec 14 of the HMFA

and Sec 29 of the B&L Act
Sec 16 of the Mortgages Act permits a mortgagee to apply to the court for the
appointment of a receiver where there is a failure by the mortgagor to perform any act
or obligation secured by the mortgage. Here, the receiver has power to collect income
from the property to make repairs and to do all things necessary for the proper
management of the property and he must be able to account to the court whenever he
is required to do so.
So who pays him? – he is paid out of the income accruing to the property. The court
will fix your remuneration when appointing you and from the monies collected, the
receiver must pay taxes and rents and all sums due on the mortgage. And any balance
left is paid to the mortgagor.
SEC 16(6) - The law clearly states that a receiver must be appointed by the court and
any contrary agreement appointing a receiver outside of court is void

Appointment of Receiver Under The Home Mortgage Act

Sec 29 of BLA provides that the mortgagee may apply to the court for the appointment
of a receiver.
Sec 14 of HMFA provides that the mortgagee is not obliged to take court proceedings
to appoint a receiver, the receiver may be appointed by writing and his appointment
revoked by writing. His remuneration shall not exceed 50% of the gross amount
received and where no rates are specified, his remuneration should not exceed 2.5% of
the gross amount received (Sec 16)
Sec 15 of HMFA lays out the duties of the receiver
The Mortgagee’s Rights Of Possession
Pre 1973 Era – The mortgagee had the legal title to the mortgaged property since he
had the term of years and as such in principle, can enter into possession of the
mortgaged property at anytime during the subsistence of the property even if the
mortgagor was punctually performing the act secured by the mortgagor unless the
mortgagor has contracted out of the right expressly or impliedly
CASE: Fourmaids v. Dudley Marshal Properties Ltd

But now, the mortgagee can only exercise the rights of possession where there is failure
of performance of an act secured by the mortgage – Sec 17 of NRCD 96 and Sec 34 of
the Borrowers and Lenders Act and Sec 13 of the Home Owners Finance Act

Under NRCD 96, where default is in respect of payment of a principal or interest, the
mortgagee’s right to possession can be exercised only after the mortgagor has been
given a 30 days notice in writing or such longer period of notice as the parties may
expressly provide

A mortgagee entitled to possession has a right to enter and take possession of the
mortgage property if this can be done peaceably without any violence – Sec 17(2) of
NRCD 96, Sec 34 of BLA(either peaceably or with assistance of the court), Sec 13
of the HOFA(peaceably or with court order with police assistance)

Generally, the duties imposed on the mortgagee in possession are onerous. The
mortgagee in possession must account to the mortgagor strictly for any profit and rents
which he receives or profits or rents which he ought to have received. This right is used
sparingly and as a prelude to sale so that u don’t stay there for too long.

If the mortgagee in possession stays on the premises for more than 12 years, adverse
possession takes place.

Priority Of Mortgagees – SEC 19 of NRCD 96

The basic rule is that the first in time shall prevail. The section provides that priorities
among encumbrances shall be in order of time subject to an express contrary
agreement among the mortgagees. The first encumbrance in time having priority. This
basic rule is subject to a number of exceptions brought about by the Mortgagees
Decree, 1972;
1.The basic rule may be displaced by statute – under the land registry act, all
conveyances affecting land must be registered, thus, your mortgage must be registered.
If not, then the basic rule may be displaced

2.By express agreement among the encumbrances – the parties can agree among
themselves to look at other circumstances such as the quantum of indebtedness, they
can also agree on prorata(where the parties agree that nobody should lose entirely)
3.By the operation of the rules of equity including rules concerning fraud, estoppel for
gross negligence or otherwise, Purchaser for value without notice of prior interest,
priority of legal over equitable interest – where the equities are equal
CASE: The rule in Dearle v. Hall

The Concept Of Tacking and Consolidation

Tacking is a process by which the first lender of the mortgage could hold on to his first
loan subsequent advances made to the mortgagor so as to obtain priority over a
mortgage intervening between the first and subsequent advances made to the
mortgagor by the first mortgagee. Tacking has been partially abolished under;
Sec 19(3) NRCD 96 which provides that no tacking shall be allowed in deciding priority
among mortgages. However, an exception is made where a mortgage is expressed to
secure further advances (In payment of mortgages, where a lender has made a subsequent
lending, that lending must not be given priority in terms of payment over other mortgages
unless the mortgage terms is expressed to secure further advances)
(KLUDZE – Tacking of further advances means that, if the mortgage provides for additional loans
to be made, such further advances are tacked to the first mortgage and are accorded the same
priority as the first one. The only person protected against this is a purchaser, not necessarily of
the legal estate, for value without notice. If, however, the earlier mortgage is legal, it is difficult
to see how the intermediate mortgagee could be without notice. In any case, the legal
mortgage to be valid must be registered under Sec 25 of the Land Registry Act, 1962 and
registration is deemed to be actual notice.)

Consolidation refers to the practice where a mortgagor who has entered into more than
one mortgage transaction with one particular mortgagee and while he is compelled as a
precondition to redeem a particular mortgage, he is to also redeem any other mortgage
he or she may have made. Consolidation is totally prohibited under;
Sec 19(4) NRCD 96 A mortgagor who enters into more than one mortgage with a
particular mortgagee is permitted to redeem any mortgage by performing act secured by
that mortgage(so that you redeem mortgages one after another and redeem the others later)
(Kludze – The doctrine of consolidation is that a person who is a mortgagee of two mortgages
made by the same mortgagor can consolidate them against the mortgagor by refusing to allow
him to redeem one without redeeming the other. This course of action may be desirable from
the point of view of the mortgagee, if one of the mortgaged properties has depreciated in value
and he wishes to redeem both but the mortgagor wishes to redeem one.)

Home Mortgage Finance Act

Sec 1 – this applies between financial institutions ….(not a private person to its
customers)(A – F)
f.-For the purchase of fixtures or chattels with regards to ….(eg.of a fixture(one that
when u remove, can cause damage to the property eg. Burglar proof but chattels is vice
versa