Wakilii

Chowdhary v Uganda Electricity Board (Civil Appeal 27 of 2010)

Supreme Court · [2011] UGSC 16 · 2011 Appeal Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Second appeal from the Court of Appeal, which had upheld the High Court's dismissal of the appellant's suit to recover arrears of rent.
Decision
Appeal dismissed; judgment and decision of the Court of Appeal upheld.

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Holding

The Supreme Court dismissed the appeal. Following the appellant's expulsion in 1972, the suit property vested in the government under the Assets of Departed Asians Act and was managed by the Custodian Board until the appellant obtained a certificate of repossession in 1994. During that period the appellant was not the legal owner or landlord and rent was payable, as determined by the Minister, to the Custodian Board, not to her. She therefore had no legal capacity to claim, negotiate, or give consideration or forbearance for arrears of rent covering the expropriation period. The agreement of 18 September 1997 by which the respondent undertook to pay such arrears was made outside the law, lacked consideration, and was unenforceable.

Facts

The appellant, an Asian, was the registered proprietor of Plot 15, Coronation Road, Gulu, and in January 1970 entered a two-year tenancy with the respondent. In 1972 the appellant was expelled from Uganda and the property vested in the government and was managed by the Departed Asians' Property Custodian Board. The respondent remained in occupation, paying rent to the Custodian Board, until it vacated in 1998. The appellant obtained a certificate of repossession in March 1994. In 1994 the appellant's lawyers demanded that the respondent pay rent arrears, including for the period from 1973. On 18 September 1997 the respondent's Board Secretary wrote agreeing to pay arrears of US$80,000 or its equivalent, and made part payment. The appellant later sued to recover the balance of about US$64,000 with interest, mesne profits, general damages and costs. The respondent contended the property had vested in the Custodian Board, that the undertaking was made under mistake, and lacked consideration.

Issues

  1. Whether there was consideration for the agreement of 18 September 1997 in which the respondent acknowledged and promised to pay arrears of rent.
  2. Whether that agreement was void and unenforceable for mistake on the part of the respondent.
  3. Whether the agreement was contrary to the provisions of the Expropriated Properties Act and therefore unenforceable.
  4. Whether the appellant was entitled to arrears of rent for the period when the property was under expropriation and vested in the government.

Orders

  • Appeal dismissed with costs in the Supreme Court and the two courts below.

Key headnotes

Land & Property — Expropriated Property — Vesting Under the Assets of Departed Asians Act
Assets of a departed Asian vest in the government without further authority and are managed by the Departed Asians' Property Custodian Board; the former owner ceases to be the legal owner of the property until a certificate of repossession is granted.
Land & Property — Expropriated Properties Act — Continued Tenancy and Liability for Rent
Where expropriated property was held under a tenancy at the time of expropriation, that tenancy is deemed to continue under the Expropriated Properties Act, and rent for the continued occupation is payable as determined by the Minister to the Custodian Board managing the property, not to the former owner.
Contract Law — Consideration — Capacity of a Former Owner of Expropriated Property
A former owner who has no legal interest in expropriated property prior to repossession cannot provide consideration or forbearance in respect of it; an agreement by which an occupier undertakes to pay arrears of rent to the former owner for the expropriation period lacks consideration and is unenforceable.
Contract Law — Contracting Out of Statute — Agreements Made Outside the Law
Parties have freedom of contract but no freedom to contract out of the law; an agreement to pay rent arrears in respect of property whose ownership and rent collection are governed by mandatory expropriation legislation is made outside the law and is of no consequence.
Statutory Interpretation — Remedial Statutes — Primacy of the Ordinary Natural Meaning
Even where a statute is remedial and to be interpreted liberally, the cardinal rule remains that the words of the statute are first given their ordinary natural meaning; resort to a strict or liberal construction arises only where the provisions are ambiguous.
Statutory Interpretation — Expropriated Properties Act s.2(2) — Nullification of Dealings Distinguished from Continued Tenancies
Under section 2(2) of the Expropriated Properties Act, paragraph (a) nullifies only purchases, transfers and grants in expropriated property, while paragraph (b) deems an existing lease or tenancy to continue; the nullification of dealings does not extinguish a continued tenancy or the rent payable under it.

Legislation cited (16)

  • Assets of Departed Asians Act, Cap 83 s.3
  • Assets of Departed Asians Act, Cap 83 s.4
  • Assets of Departed Asians Act, Cap 83 s.6
  • Assets of Departed Asians Act, Cap 83 s.6(2)
  • Assets of Departed Asians Act, Cap 83 s.13
  • Assets of Departed Asians Act, Cap 83 s.14
  • Assets of Departed Asians Act, Cap 83 s.21(2)
  • Assets of Departed Asians Decree 1973 s.13
  • Expropriated Properties Act 1982 s.2(1)
  • Expropriated Properties Act 1982 s.2(2)
  • Expropriated Properties Act 1982 s.2(4)
  • Expropriated Properties Act 1982 s.4
  • Expropriated Properties Act 1982 s.6(1)
  • Expropriated Properties Act 1982 s.10(1)
  • Expropriated Properties Act 1982 s.10(2)
  • Expropriated Properties Act 1982 s.10(3)

Cases cited (7)

  • Jaffer Brothers v Mohammed Bagalaliwo (Civil Appeal No. 43 of 1997)
  • Kasifa Namusisi v Francis Nabatanzi (Supreme Court Civil Appeal No. 4 of 2005)
  • Gokaldas Laximidas Tanna v Rosemary Muyinza & DAPCB (Supreme Court Civil Appeal No. 12 of 1992)
  • Registered Trustees of Kampala Institute v DAPCB (Supreme Court Civil Appeal No. 21 of 1993)
  • Halling Manzoor v Serwan Singh Baran (Supreme Court Civil Appeal No. 9 of 2001)
  • J.W. Kazoora v Rukuba (Supreme Court Civil Appeal No. 13 of 1972)
  • Magee v Pennine Insurance Co Ltd [1969] 2 All ER 891
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.