Wakilii

Alcon International Limited v Standard Chartered Bank of Uganda and Others (Reference 6 of 2010)

East African Court of Justice · [2013] EACJ 57 · 2013 Reference Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Reference to the East African Court of Justice seeking interpretation and application of Treaty provisions regarding cross-border investment protection and enforcement of a bank guarantee
Decision
Reference dismissed with no order as to costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

Citator coverage is limited to judgments in the Wakilii corpus and source-matched treatment records. Absence of a signal is not an assertion that the case remains 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 East African Court of Justice dismissed the reference, holding that the 1st and 3rd Respondents were improperly sued as they are neither Partner States nor Institutions of the Community under Article 30 of the Treaty. The Court further held that no cause of action existed against the 2nd Respondent because the bank guarantee upon which the claim was founded had ceased to exist following the Supreme Court of Uganda's decision setting aside the arbitral award and all related judgments. Additionally, the Court held that the Protocol on the Establishment of the East African Common Market, which came into force on 1 July 2010, does not apply retroactively to acts that occurred before that date, and therefore the Court lacked jurisdiction over the matters complained of.

Outcome

Reference dismissed with no order as to costs

Facts

Alcon International Limited, a Kenyan construction company, entered into a contract in 1994 with Uganda's National Social Security Fund (NSSF) to complete a building in Kampala for USD 16,160,000. NSSF terminated the contract in 1999 alleging defaults. After arbitration, Alcon was awarded USD 8,858,469.97. The High Court and Court of Appeal of Uganda upheld the award, and Standard Chartered Bank issued a bank guarantee for the decretal sum. However, the Supreme Court of Uganda subsequently set aside the arbitral award and all related judgments, ordering the original suit to proceed to trial afresh. Alcon filed this reference in the East African Court of Justice on 20 August 2010, seeking enforcement of the bank guarantee and alleging that Uganda failed to protect its cross-border investment. The Protocol on the Establishment of the East African Common Market came into force on 1 July 2010, after the events giving rise to the claim.

Issues

  1. Whether the reference is properly brought before the Court against the 1st and 3rd Respondents within the meaning of Article 30 of the Treaty, they being neither States nor Institutions of the Community.
  2. Whether the Applicant has a cause of action.
  3. Whether the Court has jurisdiction over acts that took place before the coming into force of the Protocol on the Establishment of the East African Common Market.
  4. Whether the reference is time-barred in accordance with Article 30 of the Treaty.
  5. Whether the provisions of the Protocol extended the jurisdiction of the Court for settlement of cross-border disputes.
  6. Whether the Respondents are in breach of the provisions of Articles 127 and 151 of the Treaty as read together with Article 54 of the Protocol by failing to honour or act in accordance with the Bank Guarantee.
  7. Whether the Applicant is entitled to the prayers sought in the reference.

Orders

  • The reference is dismissed.
  • Each party to bear its own costs.

Rules and key headnotes

Jurisdiction — East African Court of Justice — Article 30 of EAC Treaty — Proper Parties
Under Article 30 of the Treaty for the Establishment of the East African Community, the East African Court of Justice has jurisdiction only over references challenging the legality of acts of a Partner State or an Institution of the Community. Private entities such as banks and court registrars, which are neither Partner States nor Institutions established by the Summit, cannot be properly sued before the Court.
Treaty Interpretation — Vienna Convention — Non-Retroactivity of Treaties
Under Article 28 of the Vienna Convention on the Law of Treaties, unless a different intention appears from the treaty or is otherwise established, treaty provisions do not bind a party in relation to any act or fact that took place or any situation that ceased to exist before the date of entry into force of the treaty with respect to that party. The Protocol on the Establishment of the East African Common Market, which came into force on 1 July 2010, does not apply retroactively to acts that occurred before that date.
Jurisdiction — Cause of Action — Existence of Live Dispute
Where the substratum of a reference is a bank guarantee that has ceased to exist following a Supreme Court decision setting aside the arbitral award and judgments upon which the guarantee was based, no live dispute remains before the Court and no cause of action exists. The claimant's remedy lies in pursuing the original suit to conclusion in the national courts.
Treaty Interpretation — Vienna Convention — Good Faith and Ordinary Meaning
Under Article 31 of the Vienna Convention on the Law of Treaties, a treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose. This principle guides the interpretation of the Treaty for the Establishment of the East African Community.
Jurisdiction — Fundamental Requirement — Absence of Jurisdiction
Jurisdiction is the most fundamental issue that a court faces in any trial. It is the very foundation upon which the judicial edifice is constructed. Without jurisdiction, a court cannot take even the first step in its judicial journey to hear and dispose of a case. Non-retroactivity of a treaty is a strong objection that, when upheld, disposes of the case forthwith and renders the treaty inapplicable, thereby depriving the court of jurisdiction.

Legislation cited (9)

  • Treaty for the Establishment of the East African Community Article 30
  • Treaty for the Establishment of the East African Community Article 27
  • Treaty for the Establishment of the East African Community Article 127
  • Treaty for the Establishment of the East African Community Article 151
  • Protocol on the Establishment of the East African Common Market Article 29
  • Protocol on the Establishment of the East African Common Market Article 54
  • Protocol on the Establishment of the East African Common Market Article 55
  • Vienna Convention on the Law of Treaties Article 28
  • Vienna Convention on the Law of Treaties Article 31

Cases cited (4)

  • Modern Holdings (EA) Ltd v Kenya Ports Authority (EACJ Reference No. 1 of 2008)
  • Anyang' Nyong'o and Others v Attorney General of Kenya and Others (EACJ Reference No. 1 of 2006)
  • Emmanuel Mwakisha Majawasi and 748 Others v Attorney General of Kenya (EACJ Appeal No. 4 of 2011)
  • Attorney General of Tanzania v African Network for Animal Welfare (EACJ Appeal No. 3 of 2011)

Full judgment

↓ Download PDF

The original judgment as reported. Read the original PDF before relying on any passage.

Alcon International Limited v Standard Chartered Bank of Uganda and Others (Reference 6 of 2010) [2013] EACJ 57 (2 September 2013)
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.