Wakilii

Danze Entp & 7 Ors v Commissioner General (Misc. Appl. No. 955 of 1997)

High Court · [1997] UGHC 3 · 1997 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Interlocutory application arising from civil suit for order for sale of seized trade goods
Decision
Application granted with detailed directions for supervised sale of seized goods

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court granted an order for the sale of seized trade goods to prevent deterioration and avoid accumulating demurrage charges. The court ordered that the sale be conducted by the applicants under court supervision through the Registrar, with the respondent's representatives present to monitor the process. The court rejected both pure ordinary-course sale and public auction, adopting a hybrid supervised sale model. Proceeds are to be held in escrow pending final disposal of the substantive suit.

Outcome

Application granted with detailed directions for supervised sale of seized goods

Facts

The Uganda Revenue Authority seized trade goods from eight plaintiffs. The plaintiffs brought an application under Order 37 of the Civil Procedure Rules seeking orders for the sale of the seized goods, arguing that some goods were perishable and had begun to deteriorate, and that demurrage charges were accumulating. An inspection report by Independent Adjusters confirmed that perishable goods including sugar, batteries, wheat flour, and candies had started to perish. The court had previously expressed concern in a ruling dated 23 October 1997 that valuable trade commodities were perishing while litigation proceeded. The defendant/respondent did not oppose the application for sale but disagreed on the mode of sale, preferring public auction while applicants sought sale in the ordinary course of business.

Issues

  1. Whether the court should order the sale of seized trade goods that are perishable or subject to deterioration and accumulating demurrage charges.
  2. What mode of sale should be ordered: sale in the ordinary course of business or sale by public auction.

Orders

  • Respondent URA to avail the trade goods listed in Annexture A of the supporting affidavit.
  • Two surveyors/valuation experts (Mr. A.S. Babumba-Kyeyune of Allied Property Surveyors and McLarens Toplis of Independent Adjusters Uganda Ltd) to carry out valuation of the trade goods, inspect and establish damage sustained, and assess price for sale.
  • Applicants to conduct the sale with respondent's representative(s) present to report any irregularity to court immediately.
  • Sale to be supervised by the Court through the Registrar; any irregularity or malpractice to be reported to Registrar without delay.
  • Sale to keep identified the goods in which each plaintiff claims interest to enable identification of proceeds.
  • Proceeds of sale to be deposited and kept in escrow account pending final disposal of main suit.
  • Surveyors/valuers to commence and complete their work within 3 weeks from date of order.
  • Sale of goods to start three weeks from date of order and take a period of two months from commencement.

Rules and key headnotes

Civil Procedure — Interim Orders — Sale of Perishable Property — Order 37 CPR
Under Order 37 of the Civil Procedure Rules, a court may order the sale of property subject to litigation where the property is perishable or subject to speedy deterioration, or where its value is likely to be diminished by delay, in order to preserve value for the parties and mitigate loss.
Civil Procedure — Interim Orders — Mode of Sale — Court Discretion
When ordering the sale of property in dispute, the court has discretion to determine the mode of sale that will achieve the most favourable prices as expeditiously as possible while ensuring transparency, accountability, and that no interested party is prejudiced, and is not bound to adopt either pure ordinary-course sale or public auction if a hybrid supervised model better serves these objectives.
Civil Procedure — Interim Orders — Escrow Accounts — Preservation of Proceeds
Where property subject to litigation is sold pending the hearing of the substantive suit, the proceeds of sale must be deposited and kept in an escrow account to preserve the res for the successful party and ensure that conversion to cash does not prejudice any party's ultimate claim.

Legislation cited (3)

Full judgment

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Danze Entp & 7 Ors v Commissioner General (Misc. Appl. No. 955 of 1997) [1997] UGHC 3 (24 November 1997)
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.