Monday, 22 January 2018

COCOBOD battles Lithur Brew and Co. over GH¢2m legal fees

By Elvis DARKO, Accra
The Commercial Division of an Accra High Court, presided over by Justice Samuel K.A. Asiedu, has ruled in a preliminary legal objection that the law firm Lithur Brew and Company lacks capacity to institute a suit against Ghana Cocoa Board (COCOBOD) to recover legal fees of over GH¢2m (GH¢2,005,320), plus interest.

As a result, the judge dismissed the action, describing it as incompetent. The judgement was delivered on December 15, 2017.
According to the court, even though it has been established that the law firm was engaged by COCOBOD, it is only a natural person licensed as a lawyer who practiced as such from the chambers of Lithur Brew and Company who rendered the legal service may sue for recovery of the fees and not the law firm.
“A critical examination of exhibit 2, the alleged letter of engagement will reveal nevertheless that in fact it is a named person who was engaged to render the legal service, and in the opinion of the court, it is that person who was engaged and who rendered the services who may sue for legal fees.
“It is also clear from exhibit 4 that it is not the plaintiff company that rendered legal services the defendant/applicant.
“The lawyer who allegedly rendered the service said service to the defendant/applicant is again clearly stated in exhibit 4,” the court said.
Facts of the case
The COCOBOD, in a letter dated December 24, 2014, engaged Lithur Brew and Company to handle a case with agreed legal fees of GH¢4 million.
The law firm was paid GH¢2 million by the previous administration. According to the information, when the new administration took office, management of COCOBOD went for out-of-court settlement without the involvement of the hired law firm.
Consequently, on August 7, 2017, Lithur Brew and Company issued a writ of summons to recover legal fees of over GH¢2m (GH¢2,005,320) plus interest rate at prevailing commercial banks lending rates, starting from February 20, 2017 till date of final payment.
It also asked for costs, further other or orders the court may deem fit.
On November 27, 2017, COCOBOD filed a motion asking the court to strike the case on grounds that it lacked capacity and is incompetent.
COCBOD argues that by the laws of Ghana, it is only a person whose name is entered on the roll of lawyers who is competent to maintain an action for the recovery of legal fees.
It argued that Lithur Brew and Company is not entered on the roll of lawyers nor licensed to practice in accordance with law, and therefore the statement of claim stands incompetent and must be struck out.
But Lithur Brew and Company responded that Tony Lithur, as a member of and head of the chambers, competently filed court process on behalf of Lithur Brew and Company, in accordance with the Legal Professions Act, Act 32 of 1960 and the Legal Profession (Professional Conduct and Etiquette) Rules, 19 69 (LI 613).
The explanation was that Lithur Brew and Company itself as a corporate entity and law firm could not have properly filed process in the suit as the solicitor on record.
Legal analysts explained that Lithur Brew and Company will only have to re-file the suit for the substantive case to be dealt with.

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