Wakilii

Dada Isaac v Koboko United Co-operative Savings & Credit Limited (Miscellaneous Application No. 9 of 2025)

High Court · [2025] UGHC 852 · 2025 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for unconditional leave to appear and defend a summary suit arising from a guarantee of a loan
Decision
Application dismissed; judgment entered for respondent against applicant and 1st defendant in underlying summary suit

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that a guarantor who voluntarily executed a guarantee agreement and undertook to repay a loan in full upon the principal debtor's default cannot rely on bare allegations of fraud and misrepresentation without pleading specific facts supported by evidence. The applicant failed to disclose triable issues warranting leave to defend. Application dismissed with costs and judgment entered for the respondent in the underlying summary suit.

Outcome

Application dismissed; judgment entered for respondent against applicant and 1st defendant in underlying summary suit

Facts

On 17 July 2023, the 1st Defendant obtained a loan of UGX 80,000,000 from the Respondent, secured by a motor vehicle and land title, and personally guaranteed by the Applicant. The loan attracted 2% interest per annum payable in eight monthly instalments, with a 5% monthly penalty on default. On 17 March 2024, the Applicant guaranteed to pay the loan, which by then stood at UGX 92,800,000. The 1st Defendant defaulted and the loan grew to UGX 127,134,000. The Respondent filed a summary suit against both the 1st Defendant and the Applicant as guarantor. The Applicant applied for leave to appear and defend, alleging fraud, misrepresentation, conspiracy, inadequate security value, and lack of notice of default.

Issues

  1. Whether there are sufficient grounds to grant the application for leave to appear and defend the summary suit.
  2. What remedies are available for the parties.

Orders

  • Application for leave to appear and defend dismissed with costs to the Respondent.
  • Judgment entered for the Respondent against the Applicant and 1st Defendant in Civil Suit No. 0005 of 2025.

Rules and key headnotes

Contract Law — Guarantee — Liability of Guarantor — Extent of Liability
Under Section 71 of the Contracts Act Cap. 284, the liability of a guarantor is coextensive with that of the principal debtor unless otherwise provided by contract, and takes effect upon default by the principal debtor.
Civil Procedure — Summary Suits — Leave to Appear and Defend — Test for Granting Leave
Before leave to appear and defend is granted in a summary suit, the defendant must show by affidavit or otherwise that there is a bona fide triable issue of fact or law. The defendant need not show a good defence on the merits but must satisfy the court that there is an issue or question in dispute which ought to be tried.
Civil Procedure — Summary Suits — Pleading Fraud — Requirement for Particularity
Allegations of fraud and misrepresentation in an application for leave to defend will not suffice unless the applicant specifically pleads facts with actual evidence. Bare allegations without supporting material remain mere allegations and do not disclose triable issues.
Civil Procedure — Summary Suits — Effect of Refusal of Leave to Defend
Under Order 36 Rule 5 of the Civil Procedure Rules, where the court refuses to grant leave to appear and defend a summary suit, the plaintiff is entitled to a decree against the defendant.

Legislation cited (6)

Cases cited (5)

  • Maluku Interglobal Trade Agency v Bank of Uganda [1985] HCB 65
  • VS Hydro Uganda Ltd & 3 Ors v UAP Old Mutual Insurance Uganda Ltd (HCMA No. 2493 of 2023)
  • Corporate Insurance Co. Ltd v Nyali Beach Hotel Ltd [1995-1998] EA 7
  • Paul Kasagga and Anor v Barclays Bank (U) Ltd (MA No. 113 of 2008)
  • Imaging The World Africa (ITWA) Ltd v Juliet Nagawa Luggya T/A Nagawa Luggya & Co. Advocates (HCMA No. 111 of 2023)

Full judgment

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

Dada Isaac v Koboko United Co-operative Savings & Credit Limited (Miscellaneous Application No. 9 of 2025) [2025] UGHC 852 (1 August 2025)
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.