Wakilii

Kizito v Kizito Kanonya & 7 Ors [2019] UGSC 28

Supreme Court · 2019 Appeal Allowed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Second appeal to the Supreme Court from a Court of Appeal judgment that had reversed a High Court finding of fraud in a land transfer
Decision
Appeal allowed; Court of Appeal decision set aside; registration declared void for fraud, appellant reinstated on the Muyenga title as tenant in common, and awarded UGX 100,000,000 general damages with costs

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Cited — treatment unverified cited in 2 (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 Supreme Court allowed the appeal. It agreed that the 1st respondent's later refusal to perform his obligations under the oral land-exchange contract was a breach of contract, not fraud, because the intent not to perform did not exist when the contract was made. However, it held that his concealment of the true consideration in the transfer form—falsely declaring the transfer a gift rather than an exchange, and the land undeveloped to evade taxes—contravened section 92(1) of the Registration of Titles Act and amounted to fraud, rendering the registration void. The title was ordered reinstated in the joint names of the appellant and 1st respondent, and the appellant was awarded UGX 100,000,000 general damages with costs.

Facts

The appellant and the 1st respondent, sister and brother, registered land at Kyadondo Block 244 Plot 5091, Muyenga, as tenants in common in 1995. Under an oral arrangement, the appellant agreed to surrender her interest in the Muyenga land to the 1st respondent in exchange for portions of his land at Kisugu and Katwe. To effect this, she signed a blank transfer form and handed it to him. The 1st respondent completed the form, declaring the transfer a gift rather than an exchange, and stated in the consent form that the land was undeveloped (to avoid taxes) although it carried two houses. He transferred the property into his own and his seven children's names. The 1st respondent never honoured his obligation to subdivide and transfer the Kisugu and Katwe properties, and stopped the Kisugu tenant from paying rent to the appellant. The appellant sued, alleging fraudulent transfer. The High Court found fraud; the Court of Appeal reversed, treating the matter as breach of contract.

Issues

  1. Whether the 1st respondent's failure to perform his obligations under the oral land-exchange contract amounted to fraud or merely to breach of contract.
  2. Whether the concealment of the true consideration in the transfer form (declaring the transfer a gift and the land undeveloped) amounted to fraud rendering the registration void.
  3. Whether the Court of Appeal erred in ordering subdivision of the Katwe and Kisugu properties without first ascertaining their status.
  4. Whether the appellant was entitled to mesne profits and general damages.

Orders

  • Since subdivision of the Kisugu and Katwe properties is now impossible because they have long been sold to third parties, the appellant is to be reinstated onto the property at Muyenga.
  • The Commissioner Land Registration is ordered to reinstate the appellant onto the certificate of title of the suit land as a tenant in common with the 1st respondent.
  • General damages in the sum of UGX 100,000,000 are awarded to the appellant.
  • The costs of this appeal and in the courts below are awarded to the appellant.

Key headnotes

Contract Law — Fraud Distinguished from Breach of Contract — Timing of Intent Not to Perform
A failure to perform a contractual obligation amounts to fraud only where the intent not to perform existed at or before the contract was made; an intent not to perform formed after execution gives rise to a mere breach of contract, not fraud.
Land & Property — Fraud in Land Transfers — Concealment of True Consideration under Registration of Titles Act s.92(1)
Declaring a land transfer to be a gift when the true consideration was an exchange of other property conceals the true consideration contrary to section 92(1) of the Registration of Titles Act, and such concealment amounts to fraud that renders the resulting registration void.
Land & Property — Fraud — Misdeclaration to Defraud Government of Revenue
Falsely declaring land to be undeveloped, or inserting a lesser figure as consideration, in order to defraud the government of revenue taints the mode of acquisition with fraud and illegality, and a title so acquired is void.
Evidence — Standard of Proof — Fraud Must Be Strictly Proved
Fraud is a question of fact that must be strictly proved; there must be actual fraud clearly and conclusively established, and mere suspicion or inference of fraud is insufficient.
Damages & Quantum — General Damages for Breach of Contract — Assessment Where Proof Difficult
The difficulty or impossibility of assessing damages with precision is no reason to deny a plaintiff general damages for breach of contract; the court must attempt to assess them, the quantum being a matter of judicial discretion aimed at placing the injured party in the position he would have occupied had the contract been performed.
Damages & Quantum — Mesne Profits — Definition and Requirement of Proof under Civil Procedure Act s.2(m)
Mesne profits under section 2(m) of the Civil Procedure Act are profits the person in wrongful possession actually received or might with ordinary diligence have received; they are in the nature of special damages and must be specifically pleaded and proved, and a court cannot award them by speculating on quantum where no evidence of profits, rental value, or period of dispossession has been adduced.

Legislation cited (2)

  • Registration of Titles Act s.92(1)
  • Civil Procedure Act s.2(m)

Cases cited (19)

  • Yakobo M N Ssenkungu & 4 Others v Cerensio Mukasa (Civil Appeal No. 17 of 2014)
  • Senkungu v Yakobo (Civil Appeal No. 35 of 2006)
  • Kampala Bottlers Ltd v Damanico (U) Ltd (Civil Appeal No. 22 of 1992)
  • Fredrick J. K. Zaabwe v Orient Bank & 5 Ors (Civil Appeal No. 4 of 2006)
  • Gwolo Jackson vs. Uganda, High Court criminal appeal no. 0014 of 201 (Arua)
  • Samuel Kizito Mubiru & Ano v G.W. Byensiba & Ano (Civil Suit No. 513 of 1982)
  • Tradimpex (U) Ltd v Chris Serunkuma and Christine Okot (Civil Suit No. 1519 of 1999)
  • Janet Diana Cope & 4 Ors v Janet Namuli and Allan Katusiime (Civil Suit No. 33 of 2005)
  • Mudiima Issa & 5 Ors v Elly Kayanja & 2 Ors (Civil Suit No. 232 of 2009)
  • Vivo Energy (U) Ltd v Lydia Kisitu (Civil Appeal No. 7 of 2015)
  • Chaplin v Hicks [1911] 2 KB 786
  • Obongo v Kisumu Municipal Council [1971] EA 91
  • Crown Beverages Ltd v Sendi Edward (Civil Appeal No. 1 of 2005)
  • Haji Asuman Mutekanga v Equator Growers Ltd (Civil Appeal No. 7 of 1995)
  • Prehn v Royal Bank of Liverpool (1870) LR 5 Ex 92
  • Crane Bank Ltd v Nipun Narottam Bhatia (Civil Appeal No. 2 of 2014)
  • Kyambadde v Mpigi District Administration (1983) HCB 44
  • Bovet V Waletr (1917) 62 Sol Jo 104
  • Hall v Ross (1831) 3 All ER 672
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.