Incomplete processes before termination of GPGC contract resulted in judgement debt - Kofi Abotsi

The Dean of the Faculty of Law at the University of Professional Studies, Accra (UPSA), says government’s inability to complete all processes before terminating contracts resulted in the $170 million judgment debt against the state.

Ernest Kofi Abotsi, speaking on JoyNews’ Newsfile, Saturday, explained that before contracts are terminated, there is an assessment of the balance of benefit and liability to inform the parties involved whether to push forward and terminate or comply with the clauses in the contract.

Although holding the view that this procedure was followed by the government, Mr Abotsi noted that the processes were not completed to ensure the state is not hit with claims of damages.

“Everything depends on the calculation of your risk liability, i.e. If you should comply or terminate the contract, what is your cost? For the termination of your contract, your calculation should be, if you do not comply with the termination clause, what is your potential assessment of damages in case you are sued in court?

“So I have to do a commercial calculation and do an assessment of the balance of benefit and liability, and once I think it balances on the side of benefits, I go with benefit. I just terminate and go away.”

“I suspect these were done but if they were done, then the question is, when the decision was taken not to comply with the Committee’s decision, again what were the consultations? Who was speaking to who? What assessment was done? Ultimately, did we have clarity on how much it will cost if we terminate in compliance and breach of contract?

“It appears to me that somehow, some calculations weren’t done or some consultations weren’t complete and in the process, it explains why we are here,” he told host Samson Lardy Anyenini.

He, therefore, questioned the rationale for the lawyers mandated to take up such exercise to advise government to terminate the contract when indications showed government may be at loss.

“The question is who are the people who are making those assessments? Those are assessments that can be done. There are lawyers whose field are simply to specialize in quantum assessment so they will advise properly on what steps to take.”

His submission comes at a time were government has been directed by a Commercial Court in London to pay a sum of $170million in damages to the claimants; Ghana Power Generation Company (GPGC).

This is because government since it terminated the contract that existed between the two parties in 2018, failed to file its challenge on the award worth over US$134 million in favour of a power provider.

Reasons such as the 2020 general elections and Covid-19 pandemic presented by Attorney General Godfred Dame and Ghana’s State Attorneys were thrown out by the Court.

Since this development, Ranking Member on Parliament’s Energy Committee, John Jinapor, has played the blame game insisting that Ghana’s current judgement debt was caused by the Akufo-Addo-led administration.

But Attorney General Godfred Dame shifted the blame to the originators and signatories of the said contract. One of the signatories is the former Power Minister under the erstwhile John Mahama administration, Dr. Kwabena Donkor.

Meanwhile, Kofi Abotsi has revealed that the Attorney General can be held responsible for causing financial loss to the state if investigations prove there was negligence.

He said there is no immunity for the Attorney General in the 1992 constitution.

“He is liable if he fails to exercise skill and diligence and therefore he acts in a manner that we find an Attorney General should not have behaved in that circumstance,” he stated.