Geoffrey Gatete and Another v William Kyobe (Civil Appeal 7 of 2005)

Supreme Court · [2007] UGSC 7 · 2007 Appeal Allowed ✦ AI-generated summary ↓ Download

Jurisdiction

Uganda

Case Type

Second appeal to the Supreme Court from the Court of Appeal, arising from an application to set aside a consent judgment and for leave to appear and defend a summary suit.

Decision

Appeal allowed; consent judgment and judgments below set aside; appellants granted unconditional leave to appear and defend the summary suit.

The full judgment

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Treatment recorded in citing cases followed in 2 Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

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Holding

The Supreme Court allowed a second appeal arising from a consent judgment entered against a partnership firm in a summary suit. It held that service "deemed good service" on a firm under Order 30 rule 3 of the Civil Procedure Rules is not the same as "effective service" under Order 36 rule 11: service is not effective where it fails to bring the suit to a defendant's actual notice, and service on, or submission to judgment by, one partner does not bind unaware co-partners. The appellants had also shown a triable defence — that the partner lacked authority and acted fraudulently. The consent judgment was set aside and the appellants granted unconditional leave to appear and defend the suit.

Facts

William Kyobe instituted a summary suit in the High Court against GMT Group, a partnership firm of three partners — Geoffrey Gatete, Angella Maria Nakigonya, and Matsiko Kasiimwe — claiming shs.17,000,000 lent under a loan agreement dated 5 February 2002, repayable by 30 March 2002, plus shs.50,000 per day as profit on default. The day after the suit was filed, Matsiko Kasiimwe signed a consent judgment for the sums claimed, which was entered by the Deputy Registrar on 18 April 2002. The appellants said they first learnt of the judgment on 6 May 2002 when served with a warrant of attachment. They applied to set aside the decree and for leave to defend, contending they were never served with summons, that the consent judgment was procured through fraudulent conspiracy, and that Matsiko Kasiimwe lacked authority to bind the partnership. They alleged the loan was not utilised by the firm. The High Court and Court of Appeal dismissed their application and appeal, finding service effective and no good cause shown.

Issues

Whether service of summons on the partnership firm was effective within the meaning of Order 36 rule 11 of the Civil Procedure Rules.
Whether the appellants had shown good cause or a triable defence entitling them to leave to appear and defend the summary suit.
Whether the consent judgment, signed by one partner, was binding on the co-partners who were unaware of the suit.

Orders

Appeal allowed.
Judgments of the courts below set aside.
Consent judgment in the summary suit set aside.
Appellants granted unconditional leave to appear and defend the suit.
Costs of the appeals in the Supreme Court and Court of Appeal and of the application in the High Court awarded to the appellants in any event.

Key headnotes

Civil Procedure — Summary Suits — Service of Summons — Distinction between "deemed good service" and "effective service"

Service of summons that is "deemed good service" on a partnership firm under Order 30 rule 3 is not necessarily "effective service" within the meaning of Order 36 rule 11; service is not effective where it fails to bring the suit to the actual notice of the defendant.

Civil Procedure — Partnership Suits — Effect of service on, or submission to judgment by, one partner

Service of summons on one partner, or submission to judgment by one partner, does not bind co-partners who were unaware of the suit; Order 30 rule 3 does not constitute the firm a corporate legal person nor confer on the partner served authority to act for the other partners.

Civil Procedure — Summary Suits — Leave to Appear and Defend — Triable defence

On an application for leave to appear and defend a summary suit the court does not determine the merits of the suit; the applicant need only show a triable defence and is not required to prove that defence at the leave stage.

Civil Procedure — Consent Judgments — Grounds for setting aside

A consent judgment may be set aside for fraud, collusion, or for any reason that would entitle a court to set aside an agreement.

Statutory Interpretation — Meaning of the word "deemed"

The word "deemed" in legislation creates a statutory fiction by assuming the existence of a fact that may not in reality exist; an expression deeming service to be "good service" is broad enough to include service that does not produce the intended result.

Commercial Law — Partnership — Authority of a partner to bind the firm — Triable issue

Where it is alleged that a partner entered into a loan agreement or consented to judgment without authority and in fraudulent conspiracy, whether that partner acted without authority or fraudulently is a triable issue to be resolved at trial, not at the stage of an application for leave to defend.

Legislation cited (7)

Civil Procedure Rules O.36 r.11
Civil Procedure Rules O.36 r.3
Civil Procedure Rules O.36 r.4
Civil Procedure Rules O.30 r.3
Civil Procedure Rules O.30 r.6
Civil Procedure Rules O.30 r.7
Rules of the Supreme Court r.90(1)

Cases cited (4)

Brooke Bond Liebig (T) Ltd. vs. Mallya (1975) EA 266
Pirbhai Lalji vs. Hassanali, (1962) EA 306
St. Aubyn (LM) vs. A.G. (1951) 2 All ER 473
G.M. Combined (U) Ltd v Fulgence Mungereza (Civil Application No. 16 of 1998)

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.