Ramzanali Mohamed Ali Meghani v Kibona Enterprises Ltd (Civil Appeal No. 27 of 2003)

Court of Appeal · [2004] UGCA 14 · 2004 Appeal Partly Allowed ✦ AI-generated summary ↓ Download

Jurisdiction

Uganda

Case Type

Civil appeal from the High Court ruling ordering the appellant to furnish security for costs

Decision

Order for security for costs reduced from shs. 80 million to shs. 15 million; matter to proceed to hearing of the substantive suit

The full judgment

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Holding

The Court of Appeal held that the trial judge correctly applied the principles governing liability to furnish security for costs, since the appellant did not reside in Uganda and had no known property within the jurisdiction. However, the Court found the sum of shs. 80,000,000 ordered as security to be excessive, particularly given the absence of an evaluation report and the wide disparity in the parties' property valuations. Security for costs should not be used to deny a weaker party access to justice. The appeal partly succeeded: the shs. 80 million figure was set aside and substituted with shs. 15,000,000, to be deposited before hearing of the substantive suit.

Facts

The respondent, Kibona Enterprises Limited, applied in the High Court at Mbarara for an order requiring the appellant to furnish security for costs in a civil suit (H.C.C.S No. 10 of 1999). The trial judge granted the order and fixed security at shs. 80,000,000. The appellant did not reside in Uganda and had no known property within the jurisdiction. There was a wide disparity between the parties' estimates of the value of the disputed property, ranging from shs. 30 million to shs. 300 million, and no evaluation report had been produced. The appellant's suit alleged fraud and error. The appellant appealed against the order.

Issues

Whether the trial judge correctly applied the principles governing liability to furnish security for costs.
Whether the quantum of security for costs ordered (shs. 80 million) was justified.
Whether the appellant's suit had any likelihood of success.

Orders

Appeal partly succeeds.
The order for shs. 80,000,000 as security for costs is set aside.
Substituted with shs. 15,000,000 to be deposited by the appellant in the trial court before the hearing of the substantive suit.
Each party to bear its own costs.

Key headnotes

Civil Procedure — Security for Costs — Plaintiff Resident Outside Jurisdiction

The absence of property belonging to a litigant within the jurisdiction of the court, coupled with the litigant's residence outside the jurisdiction, is sufficient to justify the grant of an order for security for costs.

Civil Procedure — Security for Costs — Quantum — Access to Justice

An order for security for costs must not be excessive and should not be used as a weapon to enable the strong to deny the weak access to the courts; the quantum must be justified by evidence such as a reliable valuation of the disputed property.

Civil Procedure — Security for Costs — Likelihood of Success of the Suit

A suit cannot be treated as having no likelihood of success where it raises allegations such as fraud and error on which no evidence has been adduced at the stage the application for security for costs is made.

Cases cited (2)

Bank of Uganda v Banco Arabe Espanol (Civil Application No. 20 of 1998)
Lindsay Parkison & Co. Ltd versus Triplan (1973) 10. B.M. 609 at page 617

Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.