Wakilii

Bainomugisha Josephine v Efc (U) Ltd (Miscellaneous Application No. 821 of 2016)

High Court · [2016] UGCOMMC 313 · 2016 Injunction Granted (Conditional) AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for temporary injunction pending disposal of civil suit for fraudulent mortgage enforcement
Decision
Temporary injunction granted pending trial with condition of security deposit

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Court granted temporary injunction restraining respondent lender from selling applicant's properties pending determination of civil suit challenging mortgage enforcement. Applicant established prima facie case that matrimonial home was not pledged as collateral for current loan and demonstrated risk of irreparable harm. Injunction conditional on applicant depositing 30% of forced sale value or outstanding amount within 30 days.

Outcome

Temporary injunction granted pending trial with condition of security deposit

Facts

Applicant obtained credit facility of UGX 12,000,000 from respondent lender in April 2015, pledging land at Nankaba and chattels as security. Applicant claimed she had paid off earlier loan secured on her matrimonial home at Bulamu and recovered those documents. Applicant alleged she had not defaulted on current loan and last paid installment on 30 July 2016. On 11 August 2016, respondent published notice of sale of both properties including the matrimonial home. On 15 August 2016, applicant was served notice to vacate matrimonial home. Respondent claimed applicant had accepted loan of UGX 12,000,000 secured on both properties and had defaulted from October 2015. Applicant filed civil suit 627 of 2016 challenging the mortgage enforcement and brought this application for temporary injunction.

Issues

  1. Whether this is a proper case for grant of an order for a temporary injunction

Orders

  • Temporary injunction granted restraining the respondent from evicting the applicant and selling the applicant's property comprised in customary land at Bulamu, Kasangati, LC 1 Nangabo sub county Wakiso District and land comprised in Bulemezi Block 17 Plot 270 land at Nankaba pending the disposal of the main suit.
  • Injunction granted on condition that the applicant deposits 30% of the forced sale value of the mortgaged property or outstanding amount whichever is higher pending the determination of the main suit.
  • Deposit must be made within 30 days from this ruling, failure of which the respondent may proceed with recovery processes provided under the Mortgage Act.
  • Costs shall be in the cause.

Rules and key headnotes

Temporary Injunctions — Three-Stage Test for Grant
For a temporary injunction to issue, the court must be satisfied that: (i) the applicant has a prima facie case with a probability of success; (ii) the applicant might otherwise suffer irreparable damage which would not be adequately compensated for in damages; and (iii) if the court is in doubt on the first two points, the court will decide the application on balance of convenience.
Temporary Injunctions — Prima Facie Case — Serious Question to be Tried
A prima facie case exists where there is a serious question to be tried and the claim is not frivolous or vexatious. Disagreement between parties as to amounts loaned, amounts repaid, and which properties were pledged as collateral presents serious issues for determination sufficient to establish a prima facie case.
Mortgage Enforcement — Irreparable Injury — Matrimonial Home
Where a mortgagee seeks to sell a borrower's matrimonial home and it is disputed whether that property was pledged as collateral, disposal of the home would occasion irreparable injury to the mortgagor's spouse and family that cannot be atoned for by any award of damages, particularly where spousal consent to the mortgage is not established.
Temporary Injunctions — Balance of Convenience — Status Quo
Balance of convenience means that if the risk of doing an injustice is going to make the applicant suffer, the court would most likely be inclined to grant a temporary injunction. Status quo refers to the actual state of affairs on the suit premises prior to the filing of the main suit, not who owns the property.
Mortgage Enforcement — Conditional Injunction — Security Deposit
Under Mortgage Regulations 2012 regulation 13 and the High Court's discretion under Judicature Act section 37, a court may grant a temporary injunction restraining mortgage sale on condition that the mortgagor deposits 30% of the forced sale value of the mortgaged property or outstanding amount whichever is higher pending determination of the main suit.

Legislation cited (10)

Cases cited (7)

  • Kiyimba Kaggwa v Haji Abdu Nasser Katende (1985) HCBI 43
  • GAPCO Uganda Ltd v Kaweesa (Miscellaneous Application No. 269 of 2013)
  • Ganafa Peter Kisawuzi v DFCU Bank Limited (Court of Appeal Civil Appeal No. 64 of 2016)
  • Robert Karmma v Hotel International (Supreme Court Civil Appeal No. 8 of 1990)
  • American Cyanamid v Ethicon [1975] ALL ER 504
  • GAPCO Uganda Ltd v Kaweesa Badru & Anor (Miscellaneous Application No. 259 of 2013)
  • Amos Rwamashodi v Gatrida Nalwoga & Anor (Miscellaneous Application No. 774 of 2011)

Full judgment

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

Bainomugisha Josephine v Efc (U) Ltd (Miscellaneous Application No. 821 of 2016) [2016] UGCommC 313 (30 September 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.