Zoomlion did no wrong, can’t be surcharged – Supreme Court gives reasons

December 14, 2020
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The Supreme Court has clarified that because the Accra High Court absolved Zoomlion Ghana Limited of any wrongdoing in a GH¢184-million fumigation contract, the Auditor-General has no constitutional power to surcharge the waste management company.

The apex court held that the decision of the Accra High Court had not been appealed by the Auditor-General, and that it meant the power of the Auditor-General to surcharge private entities accused of wrongdoing in accessing public funds as stipulated in Article 187 (7) (b) (iii) of the 1992 Constitution could not apply to Zoomlion.


“The appellant (Zoomlion) having been exonerated by a court of competent jurisdiction of fraud and having been found not guilty of any wrongdoing in the course of the transaction cannot be said to be amenable to the respondent’s (Auditor-General) constitutional power under sub clause b(iii) of Article 187,” the court held.

Judgment

This was contained in a 20-page judgement which detailed the reasons why on December 3, 2020, the Supreme Court ruled that the Auditor-General had no power to surcharge Zoomlion over the GH¢184 fumigation contract.

The unanimous decision of the seven-member panel of the highest court of the land was authored by Justice Issifu Imoro Tanko Amadu, while Justice Jones Dotse presided over the panel, with Justices Yaw Appau, Gabriel Pwamang, Samuel Marful-Sau, Mariama Owusu and Clemence Jackson Honyenuga as the other members.


Surcharge

On October 29, 2018, the Auditor-General issued a surcharge and disallowance against Zoomlion for GH¢184 million for a fumigation exercise it carried out for the Ministry of Health (MOH) but which was paid by the National Health Insurance Authority (NHIA).

That was after an audit conducted by the Auditor-General on the accounts of the NHIA made findings that Zoomlion had between the year 2007 and 2018 allegedly been paid a total amount of GH¢184.9 million devoid of due process.

The Auditor-General’s case was that Zoomlion continued to receive payment from 2007 up to August 2018 even though the contract with the Ministry of Health was a four-year contract which started from August 2009.

Zoomlion appealed the decision of the Auditor-General at the Accra High Court on December 5, 2018, and urged the court to set the surcharge aside.


On January 31, 2020, although the High Court, presided over by Justice Georgina Mensah-Datsa, found Zoomlion not guilty of any wrongdoing, it upheld the Auditor-General’s constitutional power to surcharge the company, and accordingly dismissed the appeal.

Dissatisfied, on February 6, 2020, Zoomlion appealed the decision of the High Court at the Court of Appeal.

The Court of Appeal referred the case to the Supreme Court on the basis that it required constitutional interpretation.

Constitutional interpretation

The constitutional provision sent by the Court of Appeal to the Supreme Court was Article 187 (7) (b) (i), which is one of the constitutional provisions which gives the Auditor-General the power to disallow expenditure and surcharge people.

Article 187 (7) (b) (i) of the 1992 Constitution allows the Auditor-General to “disallow any item of expenditure which is contrary to law, and surcharge the amount of any expenditure disallowed upon the person responsible for incurring or authorising the expenditure”.

In its statement of case, Zoomlion argued that Article 187 (7) (b) (i) of the 1992 Constitution did not apply to it because ‘person’ as used in the provision referred to public officials and entities and not a private entity like the company.

The Auditor-General conceded that Article 187 (7)(b) (i) of the 1992 Constitution did not apply to Zoomlion because obviously it was only public officials who could authorised expenditure of public funds.

However, the Auditor-General argued that his power to surcharge Zoomlion was rather based on Article 187 (7) (b) (iii) of the 1992 Constitution which gave the Auditor-General the power to surcharge “any person by whose negligence or misconduct the loss or deficiency has been incurred”.

The Auditor-General argued that “any person” as used in Article 187 (7) (b) (iiii) included both public and private officials and entities.

No misconduct

In the judgement, the Supreme Court held that, as conceded by the Auditor-General, Article 187 (7) (b) (i) of the 1992 Constitution did not apply to Zoomlion because the company was not a public entity.

Also, it was the considered view of the apex court that Article 187 (7) (b) (iii) of the 1992 Constitution which gave the Auditor-General the power to surcharge private entities, could not come into play since Zoomlion had not been found guilty of any misconduct or wrongdoing.

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