When Bank of Ghana Wanted Prime Land In Accra For Its New Office Complex, It Apparently Asked KAA Law To Search For Suitable Land, Or At Least KAA Law Understood That It Had Been Asked.

When Bank of Ghana wanted prime land in Accra for its new office complex, it apparently asked KAA Law to search for suitable land, or at least KAA Law understood that it had been asked.

Over several years, KAA Law identified various properties and inspected them with Bank officials. One was a 6.22-acre property at Ridge belonging to SIC, which eventually became the site of BoG’s new headquarters.

KAA Law later discovered that the State had compulsorily acquired the property for BoG’s use. It accused the Bank of going behind its back and demanded $1.244 million in commission.

BoG denied appointing KAA Law as its agent. It said it had known about the Ridge land and had been negotiating with SIC since 2012.

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KAA sued.

The High Court dismissed KAA Law’s claim. It treated the relationship as one between a lawyer and a client. Since KAA could not show, among other things, a written engagement letter, the agreed scope of work and the agreed fee, its claim failed.

The High Court also ordered KAA Law to pay ₵50,000 in costs.

KAA appealed.

The Court of Appeal held that the High Court had followed the wrong legal route.

KAA Law was not providing legal services in this transaction. It was providing property or real-estate services. Therefore, the rules governing lawyers’ engagement letters and the recovery of legal fees did not apply.

That was an important victory for KAA Law but it did not win the case.

The crucial letter concerning the Ridge property stated:

“Our client has a 6-acre leasehold land at Ridge … on offer for sale.”

Those words showed that KAA Law was acting for the person offering the land, not for BoG. To claim commission from BoG as well, KAA Law effectively had to establish that it was acting for both the seller and the buyer. That is called dual agency.

One agent can represent both sides but only with the informed consent of both. An agent owes loyalty to the principal. A seller ordinarily wants the highest price; a buyer wants the lowest. Representing both sides therefore creates an obvious conflict of interest.

KAA Law produced no evidence that both parties knew about and consented to the dual representation. The Court therefore held that KAA Law had not established that it was BoG’s agent for the Ridge transaction.

Could KAA Law nevertheless recover the reasonable value of the services it had rendered, even without an enforceable contract?

Again, the Court said no. The services concerning the Ridge land appeared to have been performed for KAA Law’s own client, not for BoG. BoG could not be made to pay for services rendered to someone else.

The appeal therefore failed, except on costs. The Court of Appeal reduced the costs from ₵50,000 to ₵10,000 because the High Court had not explained how it arrived at the higher amount.

Some key lessons:

1. A service does not become a legal service merely because a lawyer provides it. The nature of the work, not the profession of the person performing it, determines the applicable rules.

2. Never leave a professional engagement to assumptions. Put in writing who appointed you, what you must do, how you will be paid and who must pay you.

3. Activity is not authority. Meetings, correspondence, inspections and years of work may show involvement, but they do not necessarily prove that someone appointed you as their agent.

4. Introducing a buyer to property does not automatically earn you a commission. You must prove that the person from whom you demand payment appointed you or agreed to pay you.

5. An agent cannot quietly serve both sides. Because buyer and seller have competing interests, dual agency requires full disclosure and the informed consent of both.