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Yoka Rubber Industries v Diamond Trust Properties (Civil Appeal 8 of 2013)

Supreme Court · [2017] UGSC 89 · 2017 Appeal Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Second appeal to the Supreme Court from a Court of Appeal decision in a civil suit concerning distress for rent.
Decision
Appeal dismissed; the Court of Appeal's decision that the distress was lawful and that the appellant pay US$9,724 in rent arrears with interest was affirmed.

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Holding

The Supreme Court dismissed a tenant's second appeal, holding that a corporate landlord may lawfully distrain for rent through an employee acting as its agent. A property manager with general authority over the landlord's properties needed no specific company resolution to levy distress. The Distress for Rent (Bailiffs) Act (Cap 76) regulates only the appointment of bailiffs and did not abolish or modify the landlord's common law right to distrain; the Interpretation Act's definition of 'person' lets an artificial person act in person through its officers. The trial court erred in finding the distress unlawful, so the appellant was entitled to no damages and the respondent recovers US$9,724 in rent arrears with interest.

Facts

The appellant ran a tyre-retreading business on the respondent's premises at Plot 8 AB Kabalega Close, Luzira, under a sublease from February 1993, which continued as a periodic tenancy at US$1,000 per month. By 1999 the appellant was in rent arrears. The respondent exercised its common law right of distress, closed the factory and seized the chattels, holding them as a pledge pending payment. The distress was levied by DW1 (May Virji), the respondent's property manager, after she consulted the company's lawyers. The appellant remained in occupation until 2004, when the goods were moved into containers. At closure US$21,327 was owed; US$11,603 was paid, leaving US$9,724 outstanding. The appellant sued for general and exemplary damages for detinue and trespass; the respondent counterclaimed for the arrears and storage charges. The trial court held the distress unlawful and awarded the appellant UGX 100,000,000 for the goods and UGX 216,000,000 for loss of earnings. The Court of Appeal reversed, declaring the distress lawful and ordering the appellant to pay US$9,724 with interest.

Issues

  1. Whether the Court of Appeal, as first appellate court, properly re-evaluated the evidence and rightly concluded that the distress was lawful.
  2. Whether the Distress for Rent (Bailiffs) Act (Cap 76) modified or replaced the common law right of a landlord to distrain for rent.
  3. Whether a corporate landlord could lawfully distrain for rent through a property manager acting as its agent, without a specific company resolution.
  4. Whether the appellant was entitled to any damages.
  5. Whether the counterclaim for rent arrears of US$9,724 with interest was rightly allowed.

Orders

  • Appeal dismissed.
  • Decision and orders of the Court of Appeal upheld.
  • Costs of the appeal and of the courts below awarded to the respondent.

Key headnotes

Distress for Rent — Corporate Landlord Acting Through Agent
A landlord that is an artificial person may lawfully levy distress for rent through an employee or officer who has general authority over its properties, and no specific company resolution or special appointment is required where the act falls within that officer's portfolio.
Corporate Personality — Acts of Officers as Acts of the Company
Where managerial powers are delegated to an officer, that officer may be treated as an organ of the company so that the officer's acts are regarded as the acts of the company itself; an artificial person can do, in person or through agents and legal representatives, anything a natural person can do.
Distress for Rent — Effect of Distress for Rent (Bailiffs) Act
The Distress for Rent (Bailiffs) Act (Cap 76) relates only to the appointment of bailiffs and did not abolish or modify the common law right of a landlord to distrain for arrears of rent.
Second Appeal — Role of the Second Appellate Court
On a second appeal the court is not required to re-evaluate the evidence as a first appellate court except in the clearest of cases; its task is to decide whether the first appellate court properly applied the principles governing re-evaluation of the evidence.
Appellate Interference with General Damages
An appellate court will not reverse an award of general damages unless the trial judge acted on a wrong principle or the amount is so high or low as to be an entirely erroneous estimate; where the award rests on a fundamentally wrong finding going to the root of the case, the award cannot stand whatever its quantum.

Legislation cited (3)

  • Distress for Rent (Bailiffs) Act (Cap 76) s.2
  • Interpretation Act (Cap 3) s.2
  • Judicature Act s.14(2)(b)

Cases cited (7)

  • Joy Tumushabe and Another (Supreme Court Civil Appeal No. 7 of 1999)
  • F. K. Motors (U) Ltd v Kabu Auctioneers and Court Bailiffs and Another (Civil Appeal No. 92 of 2003)
  • Ahamed Ibrahim Bholm v Car and General Ltd [2005] 1 ULR 92
  • Masembe v Sugar Corporation and Another [2002] 2 EA 434
  • Kifamunte (supra)
  • Pandya v R [1957] EA 366
  • Kairu v Uganda [1978] HCB 123
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.