Wakilii

Bankone Limited v Simbamanyo Estates Limited (Miscellaneous Application 645 of 2020)

High Court · [2021] UGCOMMC 178 · 2021 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application to set aside interlocutory judgment entered by registrar for failure to file defence
Decision
Interlocutory judgment set aside; applicant granted leave to file defence and challenge jurisdiction

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court set aside an interlocutory judgment entered against a Mauritian financial institution for failure to file a defence. The court held that the registrar erred in entering interlocutory judgment under Order 9 rule 8, which applies only to claims for pecuniary damages or detention of goods, where the claim sought multiple declaratory orders. The court found sufficient cause for the delay, attributing it to COVID-19 lockdown disruptions and the applicant's ignorance of Ugandan procedural law. The court rejected the principle that affidavits sworn by corporate officers require express written authorisation, holding that competence to swear an affidavit depends on ability to depose to the facts, not on formal authorisation.

Outcome

Interlocutory judgment set aside; applicant granted leave to file defence and challenge jurisdiction

Facts

In November 2017, the applicant, a Mauritian financial institution, executed a credit facility agreement with the respondent for USD 10,000,000 to refinance existing loans and complete hotel works. After the respondent defaulted, the applicant foreclosed and recovered the debt. The respondent then sued the applicant and two other financial institutions seeking declarations that the applicant was unlicensed to operate in Uganda, that the loan arrangement was void, and that the refinancing was procured by undue influence. Summons were served on the applicant in Mauritius on 19 March 2020. The applicant did not file a defence within the prescribed time. On 12 June 2020, the registrar entered an interlocutory judgment against the applicant under Order 9 rule 8. The applicant filed this application on 27 August 2020 to set aside the judgment, citing COVID-19 lockdown restrictions in Mauritius and Uganda that prevented timely response and legal consultation.

Issues

  1. Whether the deponent to the affidavit supporting the application had authority to swear it on behalf of the applicant.
  2. Whether the application to set aside the interlocutory judgment was filed within a reasonable time.
  3. Whether the applicant had sufficient cause for failing to file a defence within the time allowed.
  4. Whether there are serious issues to be tried justifying setting aside the interlocutory judgment.
  5. Whether the interlocutory judgment was validly entered under Order 9 rule 8 of the Civil Procedure Rules.

Orders

  • Application allowed.
  • Interlocutory judgment set aside.
  • Leave granted to the applicant to file a notice of intention to defend within fifteen (15) days.
  • Leave granted to file an application disputing the jurisdiction of the court for consideration as a preliminary point of law.
  • Costs of this application to abide the result of the suit.

Rules and key headnotes

Affidavits — Competence to Swear — Corporate Officers — Authority Requirements
A corporate officer who is able to depose to the facts of the case is competent to swear an affidavit on behalf of the corporation without express written authorisation. Competence to swear an affidavit is determined by the deponent's ability to swear positively to the facts on account of personal knowledge, not by formal authorisation from the party. The principle requiring written authority to swear affidavits on behalf of others, derived by analogy from representative suits, is misconceived because filing a suit raises issues of locus standi while adducing evidence concerns competence.
Setting Aside Ex Parte Orders — Sufficient Cause — COVID-19 Pandemic — Ignorance of Foreign Procedural Law
Sufficient cause for failure to take a procedural step may include disruptions caused by COVID-19 lockdown restrictions and ignorance of foreign procedural law. Ignorance of foreign procedural law is treated as ignorance of fact under section 43 of the Evidence Act and may constitute sufficient cause in exceptional circumstances. Where a foreign litigant's inaction is attributable to ignorance of Ugandan procedural law rather than deliberate delay or mala fides, and is coupled with pandemic-related operational disruptions, the court should condone the delay in the interests of substantial justice.
Interlocutory Judgment — Order 9 Rule 8 — Scope of Application — Claims for Declaratory Relief
Order 9 rule 8 of the Civil Procedure Rules, which empowers the registrar to enter interlocutory judgment where a defendant fails to file a defence, applies only to claims for pecuniary damages only or for detention of goods with or without a claim for pecuniary damages. It is erroneous for the registrar to enter interlocutory judgment under Order 9 rule 8 where the claim seeks multiple declaratory orders and other non-pecuniary relief.
Setting Aside Ex Parte Orders — Delay — Condonation — Substantial Justice
In determining whether to condone delay in applying to set aside an ex parte order, the decisive factor is not the length of delay but the sufficiency of a satisfactory explanation. Where substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. Courts should be liberal and generous in construing rules of procedure by virtue of article 126(2)(e) of the Constitution, which enjoins courts to administer substantive justice without undue regard to technicalities.
Forum Selection Clauses — Forum Non Conveniens — Jurisdiction — Non-Parties to the Clause
The applicability of the forum non conveniens doctrine to situations where a forum-selection clause is sought to be relied upon when some of the disputants are not privy to the clause is a serious issue to be tried. The analysis may include an evaluation of the parties' contractual preselected forum, the convenience of the parties, and various public-interest considerations.

Legislation cited (15)

Cases cited (15)

  • Mugo and others v Wanjiri and another [1970] EA 481
  • Njagi v Munyiri [1975] EA 179
  • Bishop Jacinto Kibuuka v The Uganda Catholic Lawyers' Society and two others (Miscellaneous Civil Application No. 696 of 2018)
  • Amtorg Trading Corporation v. United States, 71 F. 2d 524
  • The Co-operative Bank Limited v Kasiko John [1983] HCB 72
  • Kaingana Joy per Kaingana John v Boubon Dabo [1986] HCB 59
  • Makerere University v St Mark Education Institute and others (Civil Suit No. 378 of 1993)
  • Taremwa Kamishani and others v Attorney General (Miscellaneous Application No. 38 of 2012)
  • Edrisa Mutaasa and others v IGG, Lyantonde District Administration and another (Miscellaneous Cause No. 06 of 2010)
  • Kaheru Yasin and another v Zinorumuri David (Miscellaneous Application No. 82 of 2017)
  • Ssenyimba Vincent and two others v Birikade Peter and another (Miscellaneous Application No. 378 of 2018)
  • Rossette Kizito v Administrator General and others (Civil Application No. 9 of 1986)
  • Roussos v Gulam Hussein Habib Virani, Nasmudin Habib Virani (Civil Appeal No. 9 of 1993)
  • Sango Bay Estates Ltd v Dresdmer Bank [1971] EA 17
  • G M Combined (U) Limited v A K Detergents (U) Limited (Civil Appeal No. 34 of 1995)

Full judgment

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Bankone Limited v Simbamanyo Estates Limited (Miscellaneous Application 645 of 2020) [2021] UGCommC 178 (27 September 2021)
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.