For a long time, Ghanaian law has not provided a clear statutory answer on whether a joint bank account can be garnisheed to satisfy a judgment debt. But in Meyiri Company Ltd v. SIC-Financial Services and Stanbic Ghana Ltd (as Garnishee), the High Court took the bold step of addressing this legal uncertainty, and it didn’t hold back.
The case, decided by Justice Eric Baah, now sets a strong example that joint accounts can be garnisheed, as long as the court can figure out how much of the money belongs to the person who owes the debt. Therefore, if you think holding money in a joint account puts it out of reach of a creditor, this ruling should give you pause.
The Background
Meyiri Company obtained a judgment against SIC Financial Services and went after their bank accounts. The court granted a temporary garnishee order against Stanbic Bank. The bank, in turn, presented statements for three different accounts, one of which turned out to be a joint account, not solely owned by the person who owed.
After the proceedings, the court made a final garnishee order, meaning Stanbic had to release the funds. But shortly after that, Stanbic Bank returned with a new request. They asked the court to set aside the order on the joint account. The bank argued that the account was owned jointly by the debtor and someone else who had nothing to do with the lawsuit. In other words, they believed it was unfair to take money that might belong to a third party.
Legal Arguments
Stanbic’s lawyers said they had made a mistake by submitting the joint account statement. They explained that their legal duty was only to disclose accounts in the name of the judgment debtor. They relied on older English cases which held that joint accounts cannot be touched in garnishee proceedings unless all account holders are involved.
But Meyiri’s lawyers responded with evidence. They showed that nearly all deposits and withdrawals from the joint account had been made by the person who owed. The other account holder had done virtually nothing. They argued that the debtor was the true owner of the funds. They also cited a Singaporean case that supports garnishee orders on joint accounts when it is clear that the money belongs to the debtor.
The Court’s Ruling
The High Court took a strong stance. The judge was not persuaded by the older English cases. He said those decisions did not deal with modern situations where people try to hide assets by placing them in joint accounts. He believed that allowing such tactics would only help people avoid their legal debts.
The judge made it clear that if the court can find out who really owns the money in a joint account, then the judgment creditor should be allowed to collect what is owed.
A Word of Warning From the Court
Justice Eric Baah also sent a message to anyone thinking about using a joint account as a shield against legal claims. If you open a joint account with someone who ends up in debt, you may be exposing your money to risk. In the judge’s words, people must “take their partner as they find them.” Therefore, if that partner is financially reckless or sued, the court has every right to investigate where the money came from.
Guidelines From The Court
To help future cases, the court provided a step-by-step approach for handling joint accounts during garnishee proceedings. These guidelines can be summarised as follows:
- When a judgment creditor gets a garnishee order, the bank must be served and informed of the court’s decision.
- If the account in question is a joint account, the bank must notify the other account holder who is not part of the case. This gives the person a chance to come forward and explain their position.
- The bank must then tell the court what kind of account it is and confirm that the other joint account holder has been informed.
- The court can then invite the other account holder to come to court and help explain how much of the money belongs to each person.
- If the bank knows who deposited what, it should present that information to the court. If the bank does not know, then the joint account holders must provide that information.
- If no one provides any clear information, the court will assume the money in the account is split equally between the account holders.
- If the creditor is able to show what portion of the account belongs to the judgment debtor, that portion can be taken to pay the debt.
- If the creditor can prove that all the money belongs to the judgment debtor, the entire amount can be used to pay off the judgment. However, the creditor must give a written promise to refund any amount later if it turns out the money was wrongly taken.
Conclusion
The case shows that the courts will not allow people to use joint accounts to dodge their financial obligations. The decision is practical. It protects people who truly share joint accounts but also prevents abuse of the system by those trying to hide from the law.
However, it is worth noting that this is a High Court ruling, so it is not binding on higher courts such as the the Court of Appeal and the Supreme Court. Let’s emphasize that it is not binding even on other High Court judges. But it is detailed, convincing, and likely to influence how similar cases are decided in the future.
For banks, deposit-taking institutions and account holders, the case offers a critical lesson. If you are holding money with someone else and they get sued, be prepared to prove what is yours. The label “joint account” is no longer a guarantee of protection.
Alhassan Aboagye on behalf of OSD and Partners. [email protected]
