Wakilii

Ben Kavuya & Others v Wakanyira David George (Civil Appeal 31 of 2021)

Supreme Court · [2024] UGSC 13 · 2024 Appeal Allowed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Second civil appeal from a decision of the Court of Appeal, which had reversed the High Court
Decision
Appeal allowed; Court of Appeal judgment set aside and the High Court judgment dismissing the respondent's suit restored

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Cited — treatment unverified cited in 5 (treatment unverified) 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 the second appeal. It held that, the terms of the transaction having been reduced to a written land sale agreement (exhibit P1), sections 91 and 92 of the Evidence Act barred oral testimony of an alleged separate loan agreement intended to contradict or vary those terms. None of the exceptions in section 92(a)-(f) was pleaded or proved: the respondent did not plead fraud, intimidation, incapacity or mistake to invalidate the agreement. Having signed the sale agreement, executed transfer forms and surrendered the title, the respondent was bound by its terms and estopped from denying them. The Court of Appeal therefore erred in admitting oral evidence to find a loan transaction. The Court of Appeal's judgment was set aside and the High Court's judgment restored.

Facts

The respondent obtained money from the second appellant. In the transaction he executed a written land sale agreement (exhibit P1) stating consideration of UGX 272,000,000, signed transfer forms and issued a power of attorney over two suit properties. Portions of the land were subsequently transferred to the third appellant, who took possession. The respondent admitted receiving UGX 170,000,000 and signing the documents but asserted the money was a loan repayable in six months at 10% monthly interest, the documents serving only as security. No written loan agreement was produced. The High Court (Kiryabwire J) found the transaction was a sale, not a loan, and dismissed the respondent's suit. The Court of Appeal reversed, holding the transaction was a loan and the transfer to the third appellant fraudulent, and awarded the respondent special and general damages. The appellants appealed to the Supreme Court against that part of the decision finding a loan transaction.

Issues

  1. Whether the Court of Appeal erred in finding that there was no consensus ad idem when the parties executed the land sale agreement.
  2. Whether the Court of Appeal erred in concluding that the transaction between the parties was a loan and not a land sale agreement.
  3. Whether the signed land sale agreement, transfer forms and powers of attorney were meant to operate as security for a loan rather than as instruments of a land sale.
  4. Whether oral testimony of an alleged loan agreement was admissible under sections 91 and 92 of the Evidence Act to contradict the written land sale agreement.

Orders

  • Appeal allowed in its entirety with costs in this court and the courts below.
  • The judgment and orders of the Court of Appeal set aside.
  • The judgment of the High Court restored.

Key headnotes

Evidence — Parol Evidence Rule — Exclusion of oral evidence to vary a written contract (Evidence Act ss.91, 92)
Where the terms of a contract have been reduced to writing, no evidence of any oral agreement is admissible between the parties for the purpose of contradicting, varying, adding to or subtracting from those terms, unless one of the exceptions in section 92(a)-(f) of the Evidence Act is proved.
Evidence — Parol Evidence Rule — Fraud and invalidating grounds exception (Evidence Act s.92(a))
Oral evidence may be admitted to prove a fact which would invalidate a written agreement, such as fraud, intimidation, illegality, want of capacity or mistake, but the party relying on such a ground must plead and prove it; where no such ground is pleaded, the written agreement stands and cannot be displaced by oral testimony.
Contract Law — Estoppel by Contract — Binding effect of a signed agreement
A party of full age and sound understanding who signs a contract is bound by its terms, whether or not he read or understood them, and is estopped from later denying the facts and matters upon which the parties agreed in the document.
Civil Procedure — Second Appeal — Interference with concurrent findings of fact
On a second appeal the Supreme Court is bound to accept the concurrent findings of fact of the trial court and the first appellate court and will not interfere unless the findings are devoid of support in the evidence on record or are so glaringly erroneous as to be perverse.
Civil Procedure — Error of law — Erroneous admission of inadmissible evidence
The erroneous admission or rejection of evidence by a lower appellate court which substantially affects the merits of the decision constitutes an error of law on which a second appellate court is entitled to interfere.

Legislation cited (15)

  • Judicature Act s.6(1)
  • Judicature Act s.11
  • Evidence Act s.58
  • Evidence Act s.79
  • Evidence Act s.90
  • Evidence Act s.91
  • Evidence Act s.92
  • Evidence Act s.101
  • Evidence Act s.102
  • Evidence Act s.103
  • Evidence Act s.106
  • Evidence Act s.114
  • Civil Procedure Act s.72(1)(c)
  • Registration of Titles Act s.59
  • Registration of Titles Act s.176

Cases cited (25)

  • Banco Arabe Espanol v Bank of Uganda (Civil Appeal No. 18 of 1998)
  • Byaruhanga v Ruvuhanga & another (Civil Appeal No. 09 of 2014)
  • Brian Kaggwa v Peter Muramira (Civil Appeal No. 26 of 2009)
  • Advocates' Coalition for Development and Environment and others v Attorney General and another (Constitutional Petition No. 14 of 2011)
  • Yakobo M.N. Senkungu & others v Cresensio Mukasa (Civil Appeal No. 17 of 2014)
  • Mutindwa v Kisubika (Civil Appeal No. 12 of 2014)
  • Betty Kizito v David Kizito Kanonya and others (Civil Appeal No. 08 of 2018)
  • General Parts (U) Ltd and another v Non-Performing Assets Recovery Trust (Civil Appeal No. 09 of 2005)
  • General Industries v Non-Performing Assets Recovery Trust (Civil Appeal No. 5 of 1998)
  • Ms Fangmin & Crane Bank Ltd v UPS Belex Tours & Travel Limited (Civil Appeal No. 06 of 2013)
  • Kasifa Namusisi v Francis K. Ntabaazi (Civil Appeal No. 04 of 2005)
  • Frederick J.K. Zaabwe v Orient Bank Ltd and 5 others (Civil Appeal No. 04 of 2006)
  • Kampala bottlers vs Damanico Properties (U) Ltd
  • Kifamunte Henry v Uganda (Criminal Appeal No. 10 of 1997)
  • Natumansi v Kasande & 2 Ors (Civil Appeal No. 10 of 2015)
  • R. Ramachandran Ayryar vs Ramalingam Chettiar 0962) AIR 302, (1962) SCR (3) 604
  • R. Mohamed At[ Hasham vs R (1941) B E.A.C.A.93
  • R. vs. Hassan bin Said (19L2) 9 E.A.C.A. 62
  • Hirani vs. Kassam 19 (EACA) l3'l
  • Brooke Bond CI) Ltd vs. Martya n9751 E.A. 266 at pase 269
  • Huddersfield Banking Co. Ltd v Henry Lister & Son Ltd (1895) 2 Ch. D 273
  • Peekay Intermark Ltd and Harish Pawani v Australia and New Zealand Banking Group Ltd [2006] EWCA Civ 386
  • Colchester Borough Council v Smith [1991] Ch. 448
  • Keshavlal Lal.tubhai Patel vs Lal.bhai Trikumtat Mil.ts Ltd fl958] AIR 512
  • Jahuri Sah & 0thers vs Dwarka Prasad Jhunjhunwata and Others (1968) (1) SCJ 315
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.