Law Firms can sue, maintain actions to claim legal fees in their names-Court of Appeal

The Court of Appeal held on December 16, 2021, that law firms, like any juristic persons, have the power to sue and maintain actions in their names including a claim for legal fees for services rendered under an agreement entered into with a legal entity or person.

According to the court, upon incorporation, a body becomes a legal entity with rights to sue and to be sued under the COMPANIES ACT 2019(Act 992) thus a Law Firm like Atuguba & Associates which has duly incorporated and issued with a Certificate to commence business, per the Act is endowed with the power to sue and maintain actions in its name.

Background

This was an appeal against the ruling of the High Court, General Jurisdiction, Accra dated October 16, 2020, in which the learned trial judge refused an application to strike out the writ of summons and pleadings, in the action.

In the instant appeal case between SCIPION CAPITAL(UK) VRS ATUGUBA&ASSOCIATES[2021]DLCA11108, the Court of Appeal, presided over by Suurbaareh J.A. and consisted of Merley Wood (MRS), J.A. and Dodoo(MRS), J.A. was presented with the following grounds;

a.That the ruling of the trial High Court was against the weight of the evidence on record.

b.The learned trial judge erred when she held that ATUGUBA&ASSOCIATES, being a law firm whose name was neither entered in the roll of lawyers nor licensed to practice law, could sue for the recovery of legal fees.

c.The learned trial judge misapplied section 18(2) of the Companies Act 2019, (Act 992) and the ratio in Morkor v. Kumah[1999-2000] S.C.G.L.R. 721.

d. The cost awarded for the refusal of the application is excessive.

In an opinion by  Suurbaareh, J.A., the Court of Appeal further held that since a person can only act through human beings, the Respondent, ATUGUBA&ASSOCIATES as the party entitled to a claim under the action, is endowed with the capacity to institute the action.

However, this can only be done through a lawyer in the corporate firm or engaged by it.

Additionally, the Court agreed with the Respondent that having regard to the work put in at the stage the application was dismissed, the trial judge was rather lenient thus declined to award costs against the respondent thus dismissing the appeal and affirmed the ruling of the trial judge.

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