Wakilii

Ankole Riverline Hotel Ltd v Uganda Breweries Ltd & Anor (Miscellaneous Application No. HCT-12-CV-MA-0030 of 2014)

High Court · [2016] UGHCCD 3 · 2016 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for joinder of party and amendment of plaint arising from pending civil suit for commercial dispute
Decision
Application allowed; 2nd respondent joined as defendant; leave granted to amend plaint within 15 days

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that where a financial dispute involves three parties in connected transactions—the supplier, the distributee, and the guarantor bank—all parties should be joined to enable the court to effectually and completely adjudicate upon and settle all questions involved in the suit. Leave granted to join the bank as a defendant and to amend the plaint. Application allowed.

Outcome

Application allowed; 2nd respondent joined as defendant; leave granted to amend plaint within 15 days

Facts

The applicant entered into a distributorship agreement with the 1st respondent to distribute beer products in Masindi. The applicant secured credit facilities from the 2nd respondent bank to finance the distributorship, and the bank executed a guarantee undertaking to pay the 1st respondent up to shs. 300,000,000/= if the applicant defaulted. A dispute arose when the applicant alleged that the 1st respondent invoiced and billed it for products never supplied, to which the applicant had applied proceeds from the bank facility. A forensic audit revealed an alleged shortfall of approximately shs. 1,316,360,129/= owed to the applicant. The 1st respondent then moved to have the 2nd respondent effect all purported outstanding payments under the guarantee, prompting the applicant to file the main suit. Pending adjudication, the 2nd respondent moved to sell the applicant's mortgaged property (FRV 1235 Folio 6 Plots 89-91, Kabale Road, Mbarara) to recover monies paid to the 1st respondent. The applicant sought to join the 2nd respondent as a defendant and to amend the plaint.

Issues

  1. Whether leave should be granted to join the 2nd respondent (Guaranty Trust Bank) as a defendant to the main suit.
  2. Whether leave should be granted to amend the plaint to effect the joinder.
  3. Whether an interim injunction should be granted restraining the 2nd respondent from disposing of the applicant's property pending determination of the main suit.

Orders

  • The applicant shall join the 2nd respondent as a defendant to the main suit.
  • Leave is granted to the applicant to amend and file its plaint within 15 (fifteen) days of this order.
  • Court makes no order as to costs since none of the respondents filed a reply.

Rules and key headnotes

Civil Procedure — Joinder of Parties — Addition of Parties Under O.1 r.10(2) CPR
Under Order 1 rule 10(2) of the Civil Procedure Rules, the court may at any stage of proceedings order that the name of any person who ought to have been joined, or whose presence before the court may be necessary to enable the court effectually and completely to adjudicate upon and settle all questions involved in the suit, be added as a party.
Civil Procedure — Joinder of Parties — Purpose and Principles
The purpose of the joinder rule is to secure the determination of all disputes relating to the same subject matter without the delay and expense of separate actions.
Civil Procedure — Amendment of Pleadings — Principles for Granting Leave
Amendments to pleadings sought before hearing should be freely allowed if they can be made without injustice to the other side, and there is no injustice if the other side can be compensated by way of costs. The court will not refuse to allow an amendment simply because it introduces a new case, but will refuse where the amendment would change the action into one of a substantially different character or would prejudice the rights of the opposite party, for example by depriving them of a defence of limitation that has accrued.
Commercial Law — Distributorship Agreements — Disputes Involving Guarantor Banks
Where a financial dispute over products allegedly supplied under a distributorship agreement involves the supplier, the distributee, and a guarantor bank, the question of who is liable for the disputed amount can only be effectually and completely resolved with all the players being parties to the suit, so as to avoid a multiplicity of suits.

Legislation cited (5)

Cases cited (2)

  • Montgomery v Foy (1895) 2 QB 321
  • Eastern Bakery v Castelino (1958) EA 461

Full judgment

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

Ankole Riverline Hotel Ltd Vs Uganda Breweries Ltd & Anor (Miscellaneous Application No. HCT-12-CV-MA-0030 of 2014) [2016] UGHCCD 3 (11 January 2016)
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.