FINANCE LEASE ACT - 1993 (PNDCL 331)
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(1) An acquisition of assets under this Act shall be made by a finance lease agreement between the lessor and the lessee in accordance with this Act.
(2) Where the asset is to be acquired by the lessor before the finance lease agreement is finally made, the prospective lessor and lessee shall enter into a written agreement which shall cover
(a) a statement to the effect that the parties have agreed to enter into a finance lease agreement,
(b) a description of the asset to be acquired under the lease, the estimated price of the asset and the total lease rentals payable by the prospective lessee,
(c) a statement that the asset is being acquired by the prospective lessor in connection with the lease agreement which, to the knowledge of the supplier, is to be made between the prospective lessor and lessee, and
(d) a statement as to whether or not the prospective lessee has selected the asset and selected the supplier without relying on the skill and judgment of the prospective lessor.
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(1) An acquisition of assets under this Act shall be made by a finance lease agreement between the lessor and the lessee in accordance with this Act.
(2) Where the asset is to be acquired by the lessor before the finance lease agreement is finally made, the prospective lessor and lessee shall enter into a written agreement which shall cover
(a) a statement to the effect that the parties have agreed to enter into a finance lease agreement,
(b) a description of the asset to be acquired under the lease, the estimated price of the asset and the total lease rentals payable by the prospective lessee,
(c) a statement that the asset is being acquired by the prospective lessor in connection with the lease agreement which, to the knowledge of the supplier, is to be made between the prospective lessor and lessee, and
(d) a statement as to whether or not the prospective lessee has selected the asset and selected the supplier without relying on the skill and judgment of the prospective lessor.
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(1) A finance lease agreement shall contain
(a) a statement of the price of the asset and the total lease rentals payable under the finance lease agreement,
(b) the amount of each rental by which the total lease rental is to be paid and the date or the mode of determining the date on which each rental instalment is payable,
(c) a description of the asset to which the finance lease agreement relates sufficient to identify it,
(d) a clause that the lessee acknowledges, confirms and declares that the lessee holds the asset as a mere bailee of the lessor and that the lessee does not have a proprietary right, title or interest in the due asset during the entire period of the lease,
(e) a clause that the lessee confirms and acknowledges that the lessee shall pay to the lessor, lease rentals as mentioned in the finance lease agreement,
(f) a clause that the lessee confirms and acknowledges that the finance lease agreement is a full pay-out non-cancellable agreement and that the lessee does not have a right to surrender the asset during the tenure of the finance lease agreement, and
(g) a clause that on determination of the finance lease agreement by expiry of time, unless a renewal is granted or the lessor agrees to sell the asset to the lessee, the lessee shall deliver to the lessor the asset in good order and condition, ordinary wear and tear excepted.
(2) A copy of the finance lease agreement shall be delivered or sent to the lessee within fourteen days after the making of the agreement.
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(1) For the purposes of this Act, the supplier of an asset to a lessor owes to the lessee the same duties as the supplier owes to the lessor under the sale agreement, but the supplier is not liable to both the lessor and the lessee in respect of the same damage.
(2) Subsection (1) does not permit the lessee to terminate or rescind the sale agreement without the consent of the lessor.
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(1) A finance lease agreement made under this Act shall, irrespective of the value of the asset, be registered by a registering authority designated by the Bank of Ghana.
(2) The registering authority shall, before any registration, notify the Bank of Ghana of the application to register a finance lease agreement.
(3) The Bank of Ghana shall issue the necessary guidelines for the purpose of implementing this section including guidelines relating to
(a) the stamp duty payable,
(b) the registration and notarisation fees, and
(c) the procedure for filing an application for registration and cancellation of a registration.
(4) Without prejudice to the other provisions of this section, a non-registered finance lease agreement is valid as between the original parties to the contract, but is not valid with respect to third parties acting in good faith.
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(1) Where the lessee defaults in the payment of rentals in accordance with the finance lease agreement, the lessor may recover accrued unpaid rents together with interest and damages.
(2) Subject to subsection (3), where the lessee defaults in the payment of rentals, or commits another breach, the lessor may terminate the finance lease agreement, and after the termination
(a) recover possession of the asset, subject to subsection (4), and
(b) recover the damages that will place the lessor in the position in which the lessor would have been, had the lessee performed the finance lease agreement in accordance with its terms.
(3) The lessor is not entitled to exercise the right of termination under subsection (2) when the lessor has by notice given the lessee a reasonable opportunity of remedying the default so far as the default may be remedied.
(4) Where the lessor becomes entitled to repossess the asset leased through breach of agreement by the lessee or otherwise through operation of law, and the lessee does not deliver the asset after having been given due notice to surrender the asset to the lessor, the lessor may initiate legal proceedings in a Court against the lessee for the recovery of the asset.
(5) The right of the lessor to repossess does not prejudice other remedies available to the lessor under any other law, including but not limited to the right to recover damages for losses caused by non-compliance with the terms of the finance lease agreement by the lessee.
(6) Where there is repossession under this section, the lessee is, unless otherwise stipulated between the parties, responsible for the immediate payment of the rents due for the remaining term of the finance lease agreement.
(7) The parties may, under a finance lease agreement, stipulate that the amount of future rents at the time of repossession shall be decreased by the fair value of the asset repossessed less the administrative costs of the lessor, including but not limited to legal and transportation costs.
(8) The lessor shall not be entitled to recover damages to the extent that the lessor has failed to take reasonable steps to mitigate its loss.
(9) The procedure laid down in this section for the purpose of repossession by the lessor is applicable equally to a situation contemplated in section 9.
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(1) An action by a third party claiming a right to the asset shall be brought against the lessor.
(2) The lessee shall inform the lessor of an impediment or any other disturbances by third parties to the quiet enjoyment of the asset.
(3) Where the lessee fails or delays to inform the lessor as provided under subsection (2), the lessee is responsible for the charges or damages incurred by the lessor.
(4) Where as a result of legal proceedings initiated by a third party against the lessor, the value of the asset is decreased, the lessee shall have the right to reduction of the rent or cancellation of the finance lease agreement.
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(1) A lessor in a finance lease agreement shall be a body corporate incorporated as a company under the Companies Act 1963 (Act 179) and specifically licensed to engage in finance leasing.
(2) The Bank of Ghana, in consultation with the Ministry of Finance, shall by guidelines prescribe the requirements to be satisfied before a company becomes eligible for a licence to carry on the business of finance leasing.
(3) The guidelines shall, among other things, provide for
(a) the minimum paid-up capital of the company,
(b) the minimum requirements regarding management expertise and administrative controls, and
(c) the prohibition or otherwise of accepting deposits from the public by leasing companies.
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(1) For the purpose of regulating the credit system of the country, the Bank of Ghana may
(a) require finance lease companies, generally or a particular company, to furnish the Bank with statements and information or particulars relating to the business of the finance lease companies or that company in the form and at the times specified by the Bank;
(b) give to finance lease companies, generally or to a particular company, directions relating to the conduct of their or its business;
(c) in consultation with the Ministry of Finance, give to finance lease companies, generally or to a particular company, directions regarding acceptance of deposits from the public; and
(d) lay down suitable guidelines for proper supervision and control of the exercise of the power to accept deposits from the public.
(2) Without prejudice to the generality of the power vested in the Bank of Ghana under subsection (1), the statements, information or particulars to be furnished by a finance lease company may relate to all or any of the following matters of the company:
(a) the paid-up capital;
(b) the reserves and any other liabilities;
(c) the share holding pattern;
(d) the investments; and
(e) the persons to whom, and the assets and periods for which leasing is provided and the terms and conditions on which it is provided.
(3) A finance lease company shall furnish the statements, information or particulars called for and shall comply with a direction given to it by the Bank of Ghana;
(4) The Bank of Ghana may, at any time, cause an inspection to be made by one or more of its officers or employees or any other persons, of a finance lease company for the purpose of verifying the correctness or completeness of a statement, an information or the particulars furnished to the Bank of Ghana.
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(1) Where by virtue of a finance lease agreement, a lessee is under a duty to keep the asset in possession or control, the lessee shall, on receipt of a request in writing from the lessor, inform the lessor where the asset is at the time when the information is given, or if the information is sent by post, at the time of posting.
(2) A lessee who fails without reasonable cause to give the information within fourteen days of receipt of the notice, commits an offence and liable, on summary conviction, to a fine not exceeding two hundred and fifty penalty units.
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(1) The lessee under a finance lease agreement, shall not remove the asset from the Republic without the written consent of the lessor.
(2) A lessee who contravenes subsection (1), commits an offence and is liable on conviction to a fine not exceeding two hundred penalty units or to a term of imprisonment not exceeding six months or to both the fine and the imprisonment.
(3) A lessee shall not be convicted of an offence under subsection (2) where the lessee satisfies the Court that the lessee did not intend to deprive the lessor of the ownership or to defeat the rights of the lessor to obtain the payment due.
(4) If the lessor believes that the asset has been removed or is being removed from the Republic without the written consent, and with intent to deprive it of its ownership or to defeat its rights to obtain a payment due to it under the finance lease agreement, it may institute an action for the return of the asset.
(5) Before instituting an action under subsection (4), or while the action is pending, the lessor may apply to the Court for an order for the attachment of the asset.
(6) For the purpose of subsection (5), the Court may require the applicant to give security for damage resulting from the order.
(7) An order for the attachment of the asset under this section
(a) may be discharged or varied by the Court for good cause shown by a person affected by the order and on the terms as to costs specified by the Court; and
(b) shall be discharged on the lessee giving a security that the court thinks proper, taking into account the value of the asset, the amount due to the lessor and the costs of the lessor.
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Subject to this Act, the rights, duties, and liabilities of the parties to a finance lease agreement as laid down in this Act may, as between the parties themselves, be varied by express agreement or by the course of dealing between the parties, or by a custom which the parties may be taken to have agreed to be applicable to the agreement.
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(1) Where an offence is committed by a body of persons under this Act,
(a) in the case of a body corporate, other than a partnership, every director or an officer of the body shall be deemed to have committed that offence, and
(b) in the case of a partnership, every partner or officer of the partnership shall be deemed to have committed that offence.
(2) A person shall not be convicted of an offence by virtue of subsection (1) if it is proved that the offence was committed without the knowledge or connivance of that person and that due care and diligence was exercised to prevent the commission of the offence having regard to the circumstances.
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(1) A person found guilty of an offence under this Act for which a penalty is not provided, is liable, on first conviction, to a fine not exceeding two hundred and fifty penalty units or to a term of imprisonment not exceeding one year or to both the fine and the imprisonment.
(2) On a second or subsequent conviction for an offence under this Act, a Court may impose a penalty which does not exceed double the penalty referred to in subsection (1).
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