Wakilii

Mugabi v China Road Corporation Limited (Civil Appeal No. 7 of 2017)

Court of Appeal · [2022] UGCA 208 · 2022 Appeal Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Civil appeal from a High Court judgment ordering specific performance of an agreement to lease
Decision
Appeal dismissed with costs; High Court order for specific performance upheld

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Holding

The Court of Appeal dismissed the appeal, holding that the trial judge correctly found the suit was not wholly res judicata. The earlier suit (HCCS No. 84 of 2013) only nullified the registered lease instrument for non-compliance with sections 147 and 148 of the Registration of Titles Act (signatures not in Latin character and improper attestation), which related solely to registration formalities. The underlying contractual obligations and equitable lease survived, since the respondent had paid the full premium and ground rent for 99 years and taken possession. A void registration does not absolve parties of subsisting contractual obligations, and an order for specific performance and recovery under section 54 of the Contracts Act 2010 was properly available.

Facts

Mugabi, the registered proprietor of mailo land at Kitetika, Kyadondo Block 197, executed a lease agreement in 2004 in favour of China Road Corporation Ltd for 99 years. The respondent paid UGX 91,901,000 as premium and UGX 1,000 as ground rent for the full term, took possession, and the lease was registered under instrument No. KLA 268927. Mugabi later sued in HCCS No. 84 of 2013 to nullify the lease; Kwesiga J declared the registered lease instrument illegal for non-compliance with sections 147 and 148 of the Registration of Titles Act because the signature was in Chinese characters and the attestation was defective, and ordered cancellation of the title. The respondent then filed HCCS No. 649 of 2013 seeking a declaration of lawful lease, specific performance compelling execution of a proper lease, and a permanent injunction. The trial judge partly upheld a res judicata objection but found the claim for execution of a proper lease and recovery was not res judicata, holding a valid contract existed and ordering specific performance.

Issues

  1. Whether an appeal could be raised against the interlocutory ruling on res judicata in the final appeal without leave of court.
  2. Whether the suit in HCCS No. 649 of 2013 was wholly barred by res judicata given the prior nullification of the lease in HCCS No. 84 of 2013.
  3. Whether the parties entered into a valid and binding contract or agreement to lease notwithstanding the nullification of the registered lease instrument.
  4. Whether the trial judge erred in ordering specific performance of the agreement to lease.
  5. Whether the respondent acquired an equitable interest in the suit land.

Orders

  • Appeal dismissed.
  • Appellant's appeal dismissed with costs.

Key headnotes

Civil Procedure — Res Judicata — Effect of Partial Success of Plea on Right of Appeal
Where a plea of res judicata partly succeeds and results in the rejection of part of a plaint, that decision conclusively determines the rights of the parties on that point and constitutes a preliminary decree; a party who fails to appeal the preliminary decree is precluded by section 68 of the Civil Procedure Act from disputing its correctness on appeal from the final decree.
Civil Procedure — Statutory Bars — Court's Duty to Consider Res Judicata Even Without Appeal
Notwithstanding any procedural defect, an appellate court retains a duty to give effect to a statutory bar such as res judicata under section 7 of the Civil Procedure Act, since a suit barred by statute would be an illegality the court cannot sanction.
Civil Procedure — Rejection of Plaint vs Dismissal on Point of Law — Order 7 rule 11 vis-à-vis Order 6 rule 29
An application relying on facts outside the plaint, such as affidavit evidence of a prior judgment, cannot proceed under Order 7 rule 11 of the Civil Procedure Rules, which requires perusal only of the plaint; it must proceed under Order 6 rule 29 as an application to dismiss the suit as unmaintainable on a point of law.
Land & Property — Registration of Titles Act ss.147 and 148 — Effect of Non-Compliance on Underlying Contract
Non-compliance with sections 147 and 148 of the Registration of Titles Act, requiring signatures in Latin character and proper attestation, affects only the registration of the lease and the obtaining of a lease title; it does not nullify the underlying contractual obligations of the parties where all elements of a valid contract are present.
Contract Law — Void Contracts — Restitution and Compensation under section 54 of the Contracts Act 2010
Even where a contract is declared void, section 54(1) of the Contracts Act 2010 obliges a person who received an advantage under the contract to restore it or pay compensation, and a cause of action to recover money had and received under a void contract cannot be res judicata.
Land & Property — Equitable Lease — Agreement for Lease Where Premium Paid and Possession Given
Where a lessee pays the agreed premium and rent and is given possession under an agreement for a lease, an equitable lease arises that is enforceable between the parties as if a formal lease had been executed, and specific performance may be ordered notwithstanding defects in the registered instrument.

Legislation cited (17)

  • Civil Procedure Act s.2(c)
  • Civil Procedure Act s.7
  • Civil Procedure Act s.68
  • Civil Procedure Act s.76
  • Civil Procedure Act s.77
  • Civil Procedure Act s.98
  • Civil Procedure Rules Order 6 rule 29
  • Civil Procedure Rules Order 7 rule 11
  • Civil Procedure Rules Order 7 rule 19
  • Civil Procedure Rules Order 44 rule 1
  • Civil Procedure Rules Order 44 rule 2
  • Civil Procedure Rules Order 44 rule 3
  • Rules of the Court of Appeal rule 30(1)(a)
  • Registration of Titles Act s.147
  • Registration of Titles Act s.148
  • Contracts Act 2010 s.25(2)
  • Contracts Act 2010 s.54

Cases cited (33)

  • Tukamuhebwa George and Another v Attorney General (Constitutional Petition No. 59 of 2011)
  • Sunday Edward Mukooli v Administrator General (Civil Appeal No. 6 of 2015)
  • Kamunye & others v Pioneer General Assurance Society Ltd (1971) EA 262, at 265
  • Maniraguha Gashumba v Nkundiye (Civil Appeal No. 23 of 2005)
  • Ponsiano Semakuta v Susane Mugala & others (1993) Kalr 213
  • Greenhalgh v Mallard (1947) 2 All E.R. 255
  • Fidelitas Shipping Co. Ltd v V/O Exportchleb (1965) 2 All E.R. 4
  • Green Boat Entertainment Ltd v City Council of Kampala (Civil Suit No. 580 of 2003)
  • Souza Figuerado & Co. Ltd v Moorings Hotel Co. Ltd 1956 EA 925
  • Manzoor v Baram [2003] 2 EA 58
  • Smt. Mayawanti v Smt Kaushalya Devi, 1990 SCR (2) 350, 1990 SCC (3) 1
  • Ismail Jaffer Allibhai and 2 Others v Nandlal Harjivan Karia and Another (Civil Appeal No. 53 of 1995)
  • The Returning Officer Kampala and Others v Catherine Naava Nabagesera (Civil Appeal No. 39 of 1997)
  • Noble Builders (U) Ltd v Sietco (Civil Appeal No. 31 of 1995)
  • J. Hannington Wasswa and Others v Maria Ochola and Others (Civil Appeal No. 5 of 1995)
  • Gurdial Singh v Kaur (1960) EA 795
  • Peters v Sunday Post Limited [1958] 1 EA 424 at page 429
  • Auto Garage v Motokov (1971) EA 514
  • Iga v Makerere University [1972] EA 65
  • Attorney General v Otuoch (1972) EA 392
  • Jeroj Shariff & Co Vs Chotai Family Stores (1960) EA 374
  • Nurdin Ali Dewji & others v G.M.M Meghji & Co. and Others (1953) 20 EACA 132
  • Kuna Arap Rono v Swaran Singh Dhanjal [1965] EA 184
  • Michael Kamau v Gregory Gecharu [1953] 20 EACA 59
  • Ahmed Musaji Saleji and Others v. Hashim Ebrahim Saleji and Others (1914) L.R.42 I.A.91
  • G.R. Mandavia v. Rattan Singh [1965] EA 118
  • Tzamburakis and Another v Rodoussakis [1958] EA 500
  • Chanmalswami v. Gangadharappa (1915), 38 Bom, 339
  • Sidhanath Dhonddev v. Ganesh Govind (1912), 37 Bom.60
  • Frederick J.K. Zaabwe v Orient Bank Ltd and 5 Others (Civil Appeal No. 4 of 2005)
  • Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour, Ltd [1942] 2 All E.R. 122
  • Rochefoucauld vs. Boustead [1897] 1 Ch. 195
  • Walsh v Lonsdale (1882) 21 Ch. D. 9
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