Awon Denis and Others v Yako Bank Uganda Limited (Miscellaneous Application 843 of 2026)

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.

Holding

The court granted unconditional leave to appear and defend, finding that the applicants raised multiple bona fide triable issues including the applicable limitation period, the nature of the transaction, the alleged unconscionability of the 13% monthly interest rate, and the question of indebtedness. These contested issues warranted adjudication at a full hearing rather than summary determination.

Outcome

Applicants granted leave to defend; matter to proceed to full trial

Facts

The respondent bank instituted Civil Suit No. 228 of 2026 as a summary suit against the applicants arising from a loan transaction. The applicants sought unconditional leave to appear and defend, arguing that the suit was statute-barred under section 3(1) of the Limitation Act because the cause of action arose in 2014 with default in 2016, yet the suit was filed in 2026, outside the six-year limitation period for contractual claims. The applicants also contended that the agreed interest rate of 13% per month was unconscionable. The respondent countered that the transaction was a mortgage governed by section 18 of the Limitation Act, which provides a twelve-year limitation period, and that the interest rate was reasonable for a short-term three-month loan. The respondent maintained the applicants remained indebted. In rejoinder, the applicants argued the agreement was a sale agreement, not a mortgage instrument.

Issues

1. Whether the applicants raised triable issues warranting unconditional leave to appear and defend the summary suit.
2. Whether the respondent's claim is barred by the Limitation Act.
3. Whether the interest rate of 13% per month charged on the loan was unconscionable.
4. Whether the transaction was a mortgage governed by section 18 of the Limitation Act or a sale agreement governed by section 3(1).

Orders

• Unconditional leave to appear and defend Civil Suit No. 228 of 2026 is granted.
• The applicants are directed to file their written statement of defence within ten days from the date of this ruling.

Rules and key headnotes

Legislation cited (5)

• Civil Procedure Rules Order 36 rules 3 & 4
• Civil Procedure Rules Order 52 rules 1, 2 & 3
• Civil Procedure Act s.98
• Limitation Act s.3(1)
• Limitation Act s.18

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