Wakilii

Hon.Justice Prof G. W. Kanyeihamba and 320 Others v Nzeyi and Others (Civil Appeal 189 of 2014)

Court of Appeal · [2023] UGCA 189 · 2023 Appeal Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Civil appeal from the High Court (Commercial Division) decision dismissing a shareholders' fraud suit
Decision
Appeal dismissed; High Court judgment dismissing the suit stands.

The full judgment

Read the complete, verbatim text of this judgment.

Sign in to read the full judgment
Cited — treatment unverified cited in 1 (treatment unverified) Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions — always read the source judgment before relying on it.

Holding

The Court of Appeal dismissed an appeal by shareholders of Kigezi Bank of Commerce challenging the High Court's refusal of their fraud suit against directors who renamed the company to National Bank of Commerce. Grounds 1, 2, 3 and 5 were struck out under Rule 86(1) of the Court of Appeal Rules for being general and failing to specify the points wrongly decided. Ground 4, alleging a witness was shielded from cross-examination, was unsupported by the record. The court further held the appeal moot, since NBC had been liquidated and sold by the Central Bank, so no order could restore the company. Appeal dismissed with no order as to costs.

Facts

The appellants, shareholders of Kigezi Bank of Commerce Limited (KBC), sued the 1st-3rd respondents (directors) alleging they fraudulently transferred KBC's business, assets and goodwill to a new entity, National Bank of Commerce (NBC), altered KBC's memorandum and articles, changed the company's name and dismissed elected directors without proper notice. They sought declarations that the transformation and share distribution were fraudulent and void, and an order directing the Registrar of Companies to revert the position. The High Court (Commercial Division) dismissed the suit, finding the change of name lawful, the memorandum amendment proper, no business actually transferred, and the representative action non-compliant with Order 1 rule 8 of the Civil Procedure Rules. On appeal, the respondents raised preliminary objections that the grounds offended Rule 86(1) and that the appellants' submissions did not address the grounds. NBC had been taken over, liquidated and sold by the Central Bank, a liquidation upheld by the Constitutional Court in Humphrey Nzeyi v Bank of Uganda.

Issues

  1. Whether the grounds of appeal offended Rule 86(1) of the Court of Appeal Rules for being general and failing to specify the points wrongly decided, and should be struck out.
  2. Whether the trial judge failed to evaluate or properly evaluate the evidence on record.
  3. Whether the trial judge improperly shielded the 2nd Respondent from being examined and cross-examined.
  4. Whether the appellants' written submissions offended Rule 98(1) of the Court of Appeal Rules.
  5. Whether the requirements for a representative action under Order 1 rule 8 of the Civil Procedure Rules were satisfied.
  6. Whether the appeal had been overtaken by events and rendered moot.

Orders

  • Appeal dismissed.
  • Each party to bear their own costs; no order as to costs.

Key headnotes

Civil Procedure — Appeals — Grounds of Appeal — Form under Rule 86(1)
A memorandum of appeal must set forth concisely, under distinct heads and without argument or narrative, the grounds of objection, specifying the points alleged to have been wrongly decided; general grounds that fail to identify the specific error or the evidence not evaluated offend Rule 86(1) and are liable to be struck out.
Civil Procedure — Representative Actions — Order 1 rule 8 — Advertisement and Identification of Parties
A representative action requires leave of the court and prior advertisement containing the full list of identified plaintiffs so that those represented are aware of the suit; a register of shareholders tendered in evidence at the hearing does not satisfy the requirement.
Civil Procedure — First Appellate Court — Duty to Re-evaluate Evidence
A first appellate court must re-evaluate the evidence and reach its own conclusions, but will attach the greatest weight to the trial judge who saw the witnesses and will not substitute its own opinion unless the findings are shown to be unsound or against the weight of the evidence; there is no single prescribed method of evaluating evidence.
Evidence — Witnesses — Adversarial Trial — Choice of Witnesses
In an adversarial trial the parties choose which witnesses to call, and a judge does not shield a witness where defence counsel elected to close the case without calling that witness; matters outside the record of proceedings cannot form the basis of a ground of appeal.
Civil Procedure — Mootness — Academic Questions
A court will decline to decide a matter that raises only a hypothetical or abstract question; where the decision would have no practical effect on the parties' rights because the controversy no longer exists, the matter is moot and will not be adjudicated.
Company Law — Change of Name — Companies Act s.20(4)
A company may change its name by special resolution, and a change of name does not of itself transfer the company's business, which remains where it was; the change of name effects no illegality where the statutory requirements are met.

Legislation cited (10)

  • Judicature (Court of Appeal Rules) Directions SI 13-10 r.86(1)
  • Judicature (Court of Appeal Rules) Directions SI 13-10 r.90
  • Judicature (Court of Appeal Rules) Directions SI 13-10 r.98(1)
  • Judicature (Court of Appeal Rules) Directions SI 13-10 r.102
  • Judicature (Supreme Court Rules) Directions r.82(1)
  • Civil Procedure Rules SI 71-1 O.1 r.8
  • Civil Procedure Rules SI 71-1 O.1 r.8(2)
  • Civil Procedure Rules SI 71-1 O.6 r.8
  • Companies Act Cap 110 s.20(4)
  • Evidence Act Cap 6 s.117

Cases cited (23)

  • Attorney General v Florence Baliraine (Civil Appeal No. 79 of 2008)
  • Betuco (U) Ltd & Anor v Barclays Bank Uganda Ltd & Anor (Supreme Court Civil Appeal No. 1 of 2017)
  • Katumba Byaruhanga v Edward Kyewalabye Musoke (Court of Appeal Civil Appeal No. 2 of 1999)
  • Watt v Thomas [1947] 1 All ER 582
  • Okeno v Republic [1972] EA 32
  • Kifamunte Henry v Uganda (Supreme Court Criminal Appeal No. 10 of 1997)
  • Banco Arabe Espanol v Bank of Uganda [1999] UGSC 1
  • Ranchobhai Shivabhai Patel Ltd & Anor v Henry Wambuga & Anor (Civil Appeal No. 6 of 2011)
  • Celtel Uganda Ltd t/a Zain Uganda v Susan Karungi (Civil Appeal No. 73 of 2013)
  • British American Tobacco (U) Ltd v Sedrach Mwijabi & Ors (Supreme Court Civil Appeal No. 1 of 2012)
  • Bahemuka Patrick & Anor v Uganda (Supreme Court Criminal Appeal No. 1 of 1999)
  • Miller v Minister of Pensions [1947] 2 All ER 372
  • Rhesa Shipping Co v Edmunds [1985] 1 WLR 948
  • Dr. James Rwanyarare & Ors v Attorney General (Constitutional Petition No. 7 of 2002)
  • Uganda Freight Forwarders Association v Attorney General & Great Lakes Ltd (Constitutional Petition No. 22 of 2009)
  • Fang Min v Belex Tours and Travel Ltd (Civil Appeal No. 6 of 2013)
  • R v Pandya [1957] EA 336
  • Legal Brains Trust Ltd v Attorney General of Uganda (EACJ Appeal No. 4 of 2012)
  • Justice Okumu Wengi v Attorney General of Uganda (2007) 600 KALR
  • Borowski v Attorney General of Canada (1989) S.C.R 342
  • Alcon International Ltd v Standard Chartered Bank of Uganda & Ors (EACJ Appeal No. 1 of 2013)
  • Bank of Uganda v Crane Bank Limited (no citation)
  • Humphrey Nzeyi v Bank of Uganda & Attorney General (Constitutional Petition No. 42 of 2016)
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.