MTN, Aggrey case for trial

April 30, 2008 (Page 31)

FOLLOWING the non attainment of a settlement between parties at the pre-trial conference under commercial court rules between a Ghanaian businessman, Mr Richmond Aggrey, and Scancom Ghana Limited, operators of Areeba (now MTN), Investment Consortium Holdings, SA (Investcom), the majority shareholders of MTN, and Grandview Management over a shareholding dispute, the parties have been referred for trial.
Consequently, Mr Aggrey began testifying in the case at the Commercial Court in Accra yesterday and stated that he pulled out of the company and nominated his cousin to hold his shares because his continued stay in the company at the time was seen as a risk to its growth.
Mr Aggrey and the defendants went into pre-trial conference following another court’s ruling on Thursday, December 6, 2007 which restrained Investcom from seeking arbitration in the matter.
Investcom was seeking arbitration in the London Court of Arbitration but counsel for Mr Aggrey, Mr Yonni Kulendi, filed an application for interlocutory injunction restraining Investcom from further proceeding with the arbitration.
The court held that the issues in controversy before it were not issues that could be determined by arbitration, adding that the issues could be heard by a Ghanaian court of competent jurisdiction.
It, accordingly, upheld submissions by counsel for Mr Aggrey that he could not be called to go on arbitration, which was normally between shareholders, because, as it stood now, Investcom was challenging Mr Aggrey’s claim of 20 per cent shares in Scancom Ghana Limited.
Following the court’s ruling and the fact that none of the parties had filed a new application, a pre-trial conference between the parties was held at the Commercial Court complex in Accra.
The new Commercial Court rules require that there should be a pre-trial conference to offer parties an opportunity to settle their differences within 30 days after they had filed their pleadings, which they had so far done.
At the pre-trial conference, heard in camera and presided over by another judge, the parties were not able to resolve the matter within the 30-day period so it was referred for trial.
After the collapse of the talks at the pre-trial conference, Investcom filed another application to stay execution of the court’s decision to stop it from going ahead with arbitration in London but that application was also thrown out on April 4, 2008.
At the Commercial Court’s sitting in Accra yesterday, Mr Aggrey, in his evidence-in-chief, informed the court that he joined Scancom in the mid 1990s and acquired 20 per cent shares, making him the second largest shareholder at the time.
He said he was made the Vice-Chairman of the company after acquiring 20 per cent shares in the company.
Led by his counsel, Mr Aggrey said he was informed by an unknown Lebanese who told him that Scancom would be in jeopardy if he (Mr Aggrey) did not pull out of the company.
He said he called the Minister of Communications at the time, who confirmed what the Lebanese had told him.
Following that development, Mr Aggrey said he left for Nigeria and, accordingly, nominated his cousin, Mr Chris Wilmot, to hold his shares.
He continues with his evidence-in-chief on May 7, 2008.
In November 2006, Scancom, operators of MTN (then Areeba), filed an appeal challenging the Commercial Court’s dismissal of its application to strike out Mr Aggrey’s suit.
The applicant had prayed the Court of Appeal to set aside the lower court’s ruling and accordingly strike out the plaintiff’s writ of summons for non-compliance with a section of the new High Court procedure rules but the Court of Appeal dismissed the application and accordingly upheld the Commercial Court’s decision.
Scancom filed another application praying the Commercial Court to stay proceedings in the substantive matter pending the outcome of the appeal but that application was also dismissed.
The Commercial Court in Accra, on October 20, 2006, dismissed a motion filed by Scancom which prayed the court to strike out a writ of summons filed by Mr Aggrey against Scancom and the two other defendants for non-compliance with the High Court’s rules.
The plaintiff sued Investcom, the majority shareholder in Scancom, and Grandview Management Limited when Scancom decided to engage in a merger deal with MTN Incorporated of South Africa.
The deal has, however, been concluded, following the transfer of all shares in Scancom to MTN.
That was after a High Court order on July 14, 2006 which restrained Scancom and other respondents from "continuing, progressing and or concluding the merger with and/or acquisition of Investment Consortium Holdings by MTN Company of South Africa without taking into account and/or providing for the plaintiff's 20 per cent shares in Scancom Limited".
The closure of the acquisition, according to Mr Aggrey, would occasion the loss of his shareholding in the company by reason of the accrual of the rights of the MTN Group as a third party.
Mr Aggrey's contention was that his name had been removed from the shareholders’ list of Scancom without any explanation, adding that the particulars of the directors and shareholders of Scancom obtained from the Registrar General's Department, dated June 2, 2006, and signed by Mr K.A. Ohene-Obeng, a Chief State Attorney, for the Registrar of Companies, showed that Mr Aggrey's name was not included in the shareholders’ list.
It said the onus was on the company to explain how Mr Aggrey ceased to be a shareholder.
In his substantive writ, Mr Aggrey was claiming against the defendants, jointly and severally, an order directed to Scancom to pay him his true dividends declared from the 2000 to 2005 financial years.
He also sought the rectification of the membership of Scancom Ltd to include his name and restore him to his position as a shareholder and director of the company.