The shareholders of uniBank have filed for an injunction against the auctioning of some assets of the bank by the Receiver, Nii Amanor Dodoo.
This is after the Accra High Court judge presiding over the case in which the Directors of uniBank are contesting the revocation of the bank’s license appointed an arbiter, ex-Supreme Court Judge, Justice Dateh Baah, to determine whether the decision to place the bank into receivership breached the law.
The shareholders of the bank argue that until the arbiter makes a final determination on the matter, the Receiver should be restrained from selling off office equipment belonging to uniBank.
An announcement had been published on May 31 in the Daily Graphic advertising the said auction, set to take place on Wednesday, June 5, 2019.
The writ for the injunction stated that the shareholders of the bank would suffer “irreparable harm and hardship which cannot be compensated by money” if the Receiver is allowed to proceed with the auction.
The shareholders added that despite the judge’s order on the matter, the plaintiff, Mr. Dodoo, is still “actively holding himself out as Receiver of uniBank and is conducting himself in a pernicious, deleterious and baleful manner designed at totally impairing uniBank.”
This they feel could impede attempts to salvage the bank should its license be restored.
The judge, Justice Jennifer Abena Dadzie, had earlier ordered the arbitration proceedings to commence in what was a crucial ruling in favour of the bank’s directors, after an attempt by the Receiver to get their application struck out by the court.
The Directors of uniBank which was one of five banks merged by the Bank of Ghana (BoG), into the Consolidated Bank Ghana Limited are contesting the revocation of the bank’s license, which they have described as unlawful.
This decision by the judge was the latest in a series of crucial decisions for the bank’s directors after order was secured from the court to join the Attorney General to the original suit.
The Receiver had earlier filed an application asking the court to dismiss the counterclaim from the lawyer of the bank’s directors, Yaw Oppong, for the restoration of the license, arguing that it was “frivolous” and “lacked merit”
He also argued that the proper forum to address matters relating to revocation of licenses under Act 930 is an arbitration forum and not regular litigation.
The lawyer for the bank’s Directors, however, opposed this, stating that even if an Arbitration was the right forum to address their concerns, it does not warrant the dismissal of the case.
The Judge sustained this argument by the lawyer, agreeing that arbitration does not oust the jurisdiction of the commercial court in the matter.
“Where the law admits a preference for arbitration proceedings, any proceedings before the court should be stayed pending the determination of arbitration proceedings upon an application…,” she said.
The judge observed that the matters for arbitration fall within section 141 of Act 930 and includes the matter of revocation of uniBank’s license mentioned in the counterclaim.
The ruling added that “ in such matters, the authorities are clear; the court is to stay proceedings in respect of the issues that fall under the ambit of the provisions of Act 930 while the parties attempt to resolve those particular issues through arbitration.”
The judge stayed proceedings on the matter at the commercial court pending the determination by the arbiter.
Revocation of license
Announcing the consolidation of uniBank along with the other banks on August 1, 2018, the Governor of the BoG, Dr. Ernest Addison said reports from the official administrator, KPMG stated that uniBank was balance sheet insolvent.
“Among other things, the bank’s interest income and other sources of income are insufficient to cover the associated cost of funds of underlying borrowings and liabilities, as well as overheads of about GH¢0.31 billion per annum.”
These claims have, however, been challenged by the bank’s directors