The long-drawn legal tussle between SIC Insurance and Ivory Finance over a loan the former guaranteed for Italconstruct, which went bad, has reached the corridors of the Supreme Court, after SIC filed a notice of appeal.
After losing the original case in the High Court and losing the appeal in the Court of Appeal, SIC has now headed to the Supreme Court, praying it to pronounce that the Court of Appeal breached the rule of natural justice without giving the appellant [SIC Insurance] a hearing.
At a press conference, yesterday, however, Group Managing Director of CDH Financial Holdings, Emmanuel Adu-Sarkodee, noted that with the case now sent to the Supreme Court by SIC Insurance, Ivory Finance is absolutely confident in its case.
“We do not want to be prejudiced or found in contempt by our comments but we believe in our story and the fact of the case that there is nothing to be worried about. It is just a genuine business transaction and there is no fraud and collusion in the system,” he said.
The facts of the case are that on April 10, 2013, Italconstruct International, a construction firm, secured a credit facility of GH¢14million from Ivory Finance, which is now known as CDH Savings and Loans, with SIC as its guarantor.
The loan was payable in six months at a rate of 5.5percent per month, with an additional agreed penal interest rate of 8percent per month on any outstanding amount, until the credit had been totally repaid. But Italconstruct defaulted, thereby saddling its guarantor – SIC – with the debt, which has since been piling up.
In 2014, the parties agreed to a consent judgement to settle the matter out of court, with SIC’s Former Managing Director, Doris Awo Nkani, signing for her side.
After she was asked to proceed on leave in January 2015, however, lawyers of SIC filed a suit at an Accra high court that the consent judgement be set aside, on the grounds of fraud, conspiracy, and collusion among all defendants – Ivory Finance, Italconstruct, and SIC’s former MD, Doris Nkani.
But SIC’s case was thrown out by the High Court, and so it proceeded to the Court of Appeal, which ruled that SIC’s actions were “frivolous, vexatious,” and abuse of the court’s process, slapping the company with a fine of GH¢15,000.
SIC Insurance Company issued a six-month tenor guarantee bond, valued at GH¢19.3 million which allowed Italconstruct International, which had won a government bid to construct some housing units in parts of the country, to secure a credit line from Ivory Finance Company Ltd.
But due to payment delays on the part of government, Italconstruct could not make good its commitments to Ivory Finance, leading to a long-drawn battle in the courts.
On September 30, 2013, Ivory Finance sent a demand notice to the loan defaulter and the guarantor, requesting that they pay the debt, which at the time was estimated at an odd GH¢18.96 million.
Last year, an Accra High Court ordered SIC to pay off the initial loan with interest and since then SIC has paid a little over GH¢19.3million to Ivory Finance Company, being the face value of the credit guarantee bond issued by SIC.
The rest of the amount, which now runs in excess of GH¢500million, according Ivory Finance, has since become a bone of contention in the law courts among the parties.
Now, the Supreme Court is set to hear the case after SIC has exhausted all of its moves in the High and Appeal courts.