Ghanaian businessman accuses KFC of short-changing him

Mr Benjamin Amponsah, a Ghanaian entrepreneur and Chief Executive Officer of Canada-based Pas Foods International, has accused Kentucky Fried Chicken (KFC), a global fast food chain, of short-changing him in a business transaction in Ghana.

“Why should KFC renege on an agreement we clenched in Ghana and rather give me a raw deal,” he told the Ghana News Agency (GNA) in an interview.

“KFC has unfairly awarded a contract promised me, and for which I have invested a lot of time and resources,” he stressed.

Mr Amponsah, said he secured the deal with KFC, to partner the company in Ghana by establishing a chain of fast food joints.

He said as part of the agreement his company was tasked to develop the local market and establish the infrastructure for the establishment of the venture.

Mr Amponsah pursued his entrepreneurial ambition by inviting representatives of the US-based firm into the country.

He said after initial discussions with KFC, he and his partner from Canada invested in architectural designs and other assignments towards the project.

It was agreed that Mr Amponsah would develop the market and provide the infrastructure for the fast food chain.

An architect was therefore engaged to design the KFC restaurants while sites were acquired to build the food chain throughout the country.

Mr Amponsah accomplished all the prerequisite formalities and even gave a copy of his business plan to the KFC officials who he hosted at a reception in Ghana, which was attended by bankers, property owners and other stakeholders.

However, KFC made a u-turn by rather partnering a South African investor in the food market who wanted to enter the Ghanaian market with the excuse that Mr Amponsah was not qualified for the project.

Contrary to this assertion Mr Amponsah has a stake in a number of fast food chain in North America including KFC restaurants.

A legal team representing Mr Amponsah told the GNA that whoever comes to Ghana to put the ideas of their client into action could be sued in a commercial court for breach of contract and trade secrets or be made to negotiate for a fair compensation.

A document presented to the GNA by the legal team said the issue of whether there was a contract between the two parties does not arise because there were negotiations towards the award of the franchise of KFC.

“The case law in Ghana shows that a contract which is subjected to a further contact is no contract.

“We can of course argue that the initial contract was a complete contract in itself.

“It required Mr Amponsah to do certain things to his detriment and to the advantage of the partner who was to reward him by partnership and sharing profit in a company to be established in Ghana.

“He performed them and therefore if KFC failed to give him the contract in the end, then he is entitled to compensation for the initial contract on the basis of work performed. That is what we call quantum meruit basis,” the document said.

Quantum meruit is the measure of damages where an express contract is mutually modified by the implied agreement of the parties, or not completed.

The document said there was also an issue with trade secrets provided by Mr Amponsah including the conditions of the Ghanaian market, which was captured in the business plan.

“There seems to be a cause of action here because the KFC representative got his ideas about the Ghana market and then used them as a springboard to the detriment of Mr Amponsah.”

The legal team has therefore threatened to take legal action against the Management of KFC for allegedly violating the business contract. Litigation will however be the last option, after mediation has failed.

However, an official of KFC, Mr Keith Warren has dismissed the claims, saying “Pas International was part of the application process and its application was declined.

“We will like to categorically state that there was and there is no agreement with Pas International in place,” Mr Warren said.

Pas Foods International of Canada, which has a stake in a number of fast food chains in North America, is working towards entering other markets.

KFC Corporation is the world’s most popular chicken restaurant chain and is ranked number 239 on the Fortune 500 List, with revenues in excess of $11 billion in 2008.

Source: GNA