Wakilii

Candiru v Centenary Rural Development Bank Limited (CIVIL SUIT No. 0022 OF 2016)

High Court · [2017] UGHCCD 170 · 2017 Judgment for Defendant AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of contract and damages arising from an annulled land sale
Decision
Suit dismissed as incompetent. No costs awarded to either party due to both having been found guilty of fraud in an earlier proceeding.

Observed later treatment

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Holding

The High Court dismissed the plaintiff's claim for breach of contract and damages arising from an annulled land sale. The court applied the doctrine ex turpi causa non oritur actio, holding that a party found guilty of fraud in an earlier suit cannot recover damages flowing from that fraudulent transaction. Both parties were denied costs due to their involvement in the fraud.

Outcome

Suit dismissed as incompetent. No costs awarded to either party due to both having been found guilty of fraud in an earlier proceeding.

Facts

In January 2016, the plaintiff responded to the defendant bank's advertisement for sale of mortgaged property (LRV 3671 Folio 13, Plot 10 Abure Road, Koboko). She purchased the property by private treaty for UGX 55,000,000, had the title transferred into her name, took possession, undertook renovations, and let the premises to a tenant. The mortgagor sued the defendant and auctioneer challenging the foreclosure and sale. The plaintiff joined as co-defendant and counterclaimant. The High Court decided on 19 March 2015 in favour of the mortgagor, finding that the plaintiff and defendant had fraudulently connived to dispose of the property. The court cancelled the plaintiff's registration, dismissed her counterclaim with costs (UGX 16,669,000 plus execution costs of UGX 8,000,000), and ordered return of the duplicate certificate of title to the mortgagor. The plaintiff brought this suit seeking to recover the purchase price, renovation costs, legal costs, lost rental income, and general damages from the defendant.

Issues

  1. Whether the plaintiff is entitled to compensation for the sale of land comprised in LRV 3571 Folio 13 Plot 10 Abure Road which was cancelled by the court.
  2. Whether the doctrine of ex turpi causa non oritur actio bars the plaintiff's claim where both parties were found guilty of fraud in an earlier suit.
  3. What remedies are available to the parties.

Orders

  • Suit dismissed by reason of being incompetent.
  • Each party to bear their own costs.

Rules and key headnotes

Civil Procedure — Ex Turpi Causa — Bar to Recovery Where Claim Founded on Fraudulent Transaction
The doctrine ex turpi causa non oritur actio bars a plaintiff from maintaining a claim where the cause of action originates from a transaction which a court has previously found to be tainted by fraud in which the plaintiff was an active participant. No court will lend its aid to a person who founds his or her cause of action upon an immoral or illegal act.
Contract Law — Breach of Contract — Claim for Indemnity Precluded by Fraud
A plaintiff who has been found in earlier proceedings to have used an agreement for the unlawful purpose of fraudulently depriving another person of property is precluded from relying on the same agreement to claim relief against the other party to that agreement. If a plaintiff cannot sustain his or her claim without relying upon an illegal transaction to which he or she was party, the action fails.
Civil Procedure — Costs — Denial of Costs to Successful Party Guilty of Misconduct
Under section 27(2) of the Civil Procedure Act, although costs ordinarily follow the event, a successful litigant who has been guilty of misconduct relating to the circumstances leading up to the litigation may be denied costs. Where both parties have been found to have perpetrated fraud, each party may be ordered to bear their own costs.
Civil Procedure — Ex Turpi Causa — Rationale and Public Policy
The doctrine ex turpi causa applies to deny recovery where lending the court's assistance to persons involved in serious criminal or dishonest activity would reflect adversely on the administration of justice. The rationale is the need for criminal courts and civil courts to speak with a consistent voice, and to prevent a person from using the courts to recover a remedy based on a fraudulent transaction.

Legislation cited (1)

Cases cited (4)

  • Hardy v Motor Insurers' Bureau [1964] 2 QB 745
  • Safeway Stores Ltd v Twigger [2011] 2 All ER 841
  • Mason v Clarke [1955] AC 778
  • Anglo-Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd [1951] 1 All ER 873

Full judgment

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

Candiru v Centenary Rural Development Bank Limited (CIVIL SUIT No. 0022 OF 2016) [2017] UGHCCD 170 (21 December 2017)
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.