Court orders GFA, FIFA to pay T.T Ustay $253,000

Sports News of Thursday, 5 March 2015

Source: Graphic Online

Kwesi Nyantakyi

The Accra High Court has ordered the Ghana Football Association (GFA) and the Federation of International Football Associations (FIFA) to pay $253,113.80 or its cedi equivalent to T. T. Ustay Limited as indemnity in connection with the construction of the Goal Project at Prampram.

The court, presided over by Mrs Justice Barbara Ackah-Yensu, also ordered the two institutions to pay interest on the sum at the prevailing commercial rate from September 2004 until the date of final payment.

It gave the order in its judgement in a case instituted by Ecobank Ghana Limited against Akaidoo Enterprise Limited for the recovery of Ghc337,956.62, together with interest at the agreed rate of 27.45 per cent, plus a spread of five per cent per annum from August 17, 2006 to the date of full and final payment.

According to a statement of claim filed by Ecobank, it granted a short-term loan of GH?165,000 in or about April 2004 to finance the defendant’s construction project.

The loan was secured by receivables from executed contracts due to the defendant from clients, which included T. T. Ustay Limited, on account of the FIFA Goal Project at Prampram.

It said the loan taken by the defendant from the plaintiff was to be repaid from sources which included the Goal Project.

The defendant, Akaidoo Enterprise Limited, on the other hand, contended that T.T. Ustay Limited was contracted by FIFA and the GFA to undertake the Goal Project in or about June 2003.

It said the defendant was engaged by T.T. Ustay as a sub-contractor on the Goal Project for the purpose of undertaking constructional works on behalf of T.T. Ustay.

It said the agreed sub-contract sum was $548,535, out of which $303,000 was paid to the defendant, leaving an outstanding balance of $245,535.

According to the defendant, it successfully completed the project and handed it over to T.T. Ustay in September 2004 for onward delivery to the GFA and FIFA.

The defendant served several reminders and demand letters on T.T. Ustay but it failed to pay the defendant.

Akaidoo Enterprise, therefore, issued a notice against T.T. Ustay, claiming indemnity from it against the claim by Ecobank.

Third party proceedings arose as a result of a judgement obtained by Ecobank against Akaidoo Enterprise for the recovery of the sums being claimed.

After a judgement was entered in favour of the plaintiff, the defendant filed a motion ex-parte against T.T. Ustay.

In its defence, T.T. Ustay claimed that it was not liable to provide any indemnity to Ecobank’s claim against Akaidoo Enterprise.

It initially disputed Akaidoo Enterprise’s claims but subsequently secured an order for further third party notice to be issued and served on the GFA and the FIFA, claiming contribution or indemnity to the tune as set out in the final payment certificate issued by the supervising consultant hired by the GFA and the FIFA.

The GFA and the FIFA maintained that they never sanctioned variations and additional works on the project and denied any liability.

They also counter-claimed for the payment of penalty by T.T. Ustay for failure to complete and hand over the project on the scheduled date.

In its judgement, the court said it was clear from the evidence on record that the alterations, variations and additions as carried out on the Goal Project were not done by T.T. Ustay on its own accord but rather on the instructions of the GFA.

“The fact of the matter is that not only were the variations and additions authorised by the consultants engaged by the GFA and the FIFA as their agents; the additional works were actually executed under their watchful eyes.

“Indeed, the GFA has taken over the Goal Project and is actually utilising same with all the additions and variations done at their request,” the court held.

It further noted that after the Goal Project had been handed over to the GFA, the consultant submitted a final payment certificate for the payment of $252,113 in favour of T.T. Ustay, and that amount was later established by actual survey to be $253,161 payable to Akaidoo Enterprise and T.T. Ustay in the sums of $186,846.98 and $66,314.08, respectively.

“I, therefore, hold that T.T. Ustay is entitled to be indemnified by the GFA for the cost of additional work quantified, valued and certified in the final accounts prepared by the consultants: $253,161.06 or its cedi equivalent,” the judge said.

Costs of GH¢10,000 each was awarded in favour of Akaidoo Enterprise and T. T. Ustay.