Wakilii

Eastern and Southern African Trade & Anor v Hassan Basajjabalaba & Anor (HCT-00-CC-CS 512 of 2006)

High Court · [2007] UGCOMMC 32 · 2007 Preliminary Objection Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Preliminary objection to jurisdiction raised at scheduling conference in civil suit for specific performance and damages
Decision
Matter to proceed to scheduling conference with exploration of ADR

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court has jurisdiction to hear disputes involving contracts governed by foreign law where the parties have not expressly agreed on venue and the defendants are within Uganda. A choice of law clause selecting English law does not oust Ugandan jurisdiction absent an express venue clause. Where only the loan agreement contains an arbitration clause but the guarantee deed does not, defendants sued on the guarantee cannot invoke arbitration. Minor procedural defects in amended pleadings will be overlooked under Article 126(2)(e) where the original plaint complied and no surprise results.

Outcome

Matter to proceed to scheduling conference with exploration of ADR

Facts

The plaintiff bank sued the defendants jointly and severally for specific performance of a Deed of Guarantee dated 10 July 2002, general damages for fraud and misrepresentation, costs and interest. The guarantee was related to a loan facility agreement between the plaintiff and Basajjabalaba Hides and Skins Ltd. When the case came up for scheduling conference, defendants raised three preliminary objections: (1) that the Court lacked jurisdiction because the guarantee was governed by English law; (2) that the matter should be referred to arbitration; and (3) that the amended plaint was incompetent for lacking required lists of documents, witnesses and summary of facts.

Issues

  1. Whether the High Court of Uganda has jurisdiction to hear and determine a dispute arising from a guarantee agreement governed by English law.
  2. Whether the matter should be referred to arbitration.
  3. Whether the amended plaint is competent for lacking certain required attachments.

Orders

  • All three preliminary objections overruled.
  • Case set down for scheduling conference to explore Alternative Dispute Resolution, particularly mediation.
  • Costs of the preliminary objections to abide the outcome of the main suit.

Rules and key headnotes

Jurisdiction — Choice of Law — Foreign Governing Law
A contractual clause stipulating that a contract shall be governed by the law of a foreign jurisdiction does not, by itself, oust the jurisdiction of Ugandan courts where the parties have not expressly agreed on venue and the defendant is within Uganda.
Constitutional Interpretation — High Court Jurisdiction
The Constitution of Uganda (Article 132) read with the Judicature Act (s.14(2)) grants the High Court original jurisdiction in all matters, and this jurisdiction is not ousted by a choice of foreign law clause absent an express agreement as to venue.
Application of English Law — Contract Act Cap. 73
Under s.2(1) of the Contract Act Cap. 73, the common law of England relating to contracts as modified by the doctrines of equity applies in Uganda, and Ugandan courts may apply English law to contracts where parties have so stipulated, following the principle that English courts may determine disputes where the defendant is served within the jurisdiction.
Arbitration — Distinct Agreements — Guarantee Deeds
Where a loan facility agreement contains an arbitration clause but a separate guarantee deed executed by sureties does not, defendants sued on the guarantee cannot invoke the arbitration clause in the loan agreement to which they were not parties.
Pleadings — Amended Pleadings — Procedural Irregularities
Where an original plaint complies with procedural requirements and an amended plaint makes only minor alterations, the Court may overlook alleged defects in the amended plaint under Article 126(2)(e) of the Constitution in the interests of justice, particularly where no surprise or prejudice results to the opposing party.

Legislation cited (6)

Cases cited (3)

  • Fonville v Kelly and Others [2002] 1 EA 71
  • Tononoka Steels Ltd v East & Southern African Trade & Development Bank [2002] 2 EA 536
  • Sule Pharmacy Ltd v The Registered Trustees of the Khoja Shia Itana Shari Jamat (Misc. Application No. 147 of 1999)

Full judgment

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

Eastern and Southern African Trade & Anor v Hassan Basajjabalaba & Anor (HCT-00-CC-CS 512 of 2006) [2007] UGCommC 32 (12 April 2007)
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.