Wakilii

Formular Feeds Limited and 3 Others v KCB Bank Limited (Miscellaneous Application 1647 of 2023)

High Court · [2019] UGCOMMC 239 · 2019 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for stay of execution pending determination of appeal to the Supreme Court
Decision
Application for stay of execution dismissed

Observed later treatment

Cited — treatment unverified cited in 1 (treatment unverified) Sequitur — Uganda’s citator · Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

Citator coverage is limited to judgments in the Wakilii corpus and source-matched treatment records. Absence of a signal is not an assertion that the case remains good law.

No adverse treatment recorded Cited 1 time with no adverse treatment recorded; not yet tested on the merits. Derived from citing cases in the Wakilii corpus — a deterministic signal, not legal advice.

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions—always read the source judgment before relying on it.

Holding

Held that the applicants failed to satisfy the majority of essential requirements for a stay of execution. They did not demonstrate that the appeal had reasonable prospects of success, that execution would render the appeal nugatory, or that they would suffer substantial loss beyond ordinary loss to a judgment debtor. The appeal was conditioned on depositing security for costs which remained unfulfilled almost a year after the order, and execution would not cause irreversible harm where the remedy of restitution remained available.

Outcome

Application for stay of execution dismissed

Facts

The 1st applicant borrowed shs. 3,700,000,000 from the respondent bank secured by mortgages, a debenture and personal guarantees. After litigation, partial consent judgment was entered admitting liability of shs. 2,159,000,000. The trial court judgment of 10 February 2016 found the 1st applicant indebted to the respondent in shs. 4,272,740,116 with interest at 21% per annum, upheld on appeal to the Court of Appeal on 8 July 2019. Execution by attachment and sale of eighteen plots was set aside as illegal because the applicants, being non-citizens, could not own mailo land. Thereafter, the applicants transferred the titles in violation of court orders and were found in contempt. The respondent filed for execution by arrest and imprisonment of the guarantors (2nd, 3rd and 4th applicants). The applicants appealed to the Supreme Court and sought a stay of execution, but had not complied with prior Supreme Court orders to deposit shs. 100,000,000 security for costs and shs. 141,726,801 balance of taxed costs within 45 days of a ruling delivered 24 March 2022.

Issues

  1. Whether the applicants are entitled to a stay of execution of the decree pending determination of their appeal to the Supreme Court.

Orders

  • Application dismissed.
  • Costs to the respondent.

Rules and key headnotes

Civil Procedure — Stay of Execution — Conditions for Grant — Notice of Appeal Filed
An application for stay of execution must be made after notice of appeal has been filed and the applicant must be prepared to meet the conditions including furnishing proof that substantial loss may result unless stay is granted, that the application has been made without unreasonable delay, and that security for due performance of the decree has been given.
Civil Procedure — Stay of Execution — Appeal Not Frivolous and Has Likelihood of Success
The court must be satisfied that the prospects of the appeal succeeding are not remote but that there is a realistic chance of success. More is required than a mere possibility of success. There should be a sound, rational basis, founded on the facts and law, justifying the conclusion that the appellate court could reasonably arrive at a conclusion different from that of the trial court.
Civil Procedure — Stay of Execution — Appeal Rendered Nugatory
Whether an appeal will be rendered nugatory if stay is not granted depends on whether what is sought to be stayed if allowed to happen will be reversible, or if not reversible, whether damages will reasonably compensate the party aggrieved. Satisfaction of a money decree does not ordinarily render a pending appeal nugatory where the respondent is not impecunious, as the remedy of restitution is available to the applicant in the event the appeal is allowed.
Civil Procedure — Stay of Execution — Substantial Loss — What Constitutes
Substantial loss does not mean the ordinary loss to which every judgment debtor is necessarily subjected when losing a case and being deprived of property in consequence. The applicant must establish other factors showing that execution will create a state of affairs that will irreparably affect or negate the very essential core of the applicant as the successful party in the appeal. The loss ought to be of a nature which cannot be undone once inflicted.
Civil Procedure — Stay of Execution — Security for Due Performance of Decree — Interpretation
The requirement to give security for due performance of the decree does not operate as an absolute clog on the court's discretion to direct the deposit of some amount as a condition for grant of stay of execution in appropriate cases. Courts have been reluctant to order security for the entire decretal amount as this is likely to stifle appeals, and have instead favoured ordering security for costs to ensure a respondent is protected for costs incurred in responding to the appeal.
Civil Procedure — Civil Imprisonment — Debtors Unable to Pay Due to Poverty
To commit a debtor to prison who through poverty is unable to satisfy the judgment debt is contrary to the purpose of civil imprisonment which is to coerce payment. It becomes punishment that can be avoided by a debtor able but unwilling to pay, but becomes mandatory against one without means to pay. It discriminates between the two. Poverty-stricken judgment debtors should not be consigned to jail, consistent with international law principles that no one should be imprisoned merely on grounds of inability to fulfil contractual obligations.

Legislation cited (9)

Cases cited (7)

  • Lawrence Musiitwa Kyazze v Eunice Businge (Supreme Court Civil Application No. 18 of 1990)
  • Kyambogo University v Prof. Isaiah Omolo Ndiege (Court of Appeal Miscellaneous Civil Application No. 341 of 2013)
  • Mulindwa George William v Kisubika Joseph (Supreme Court Civil Application No. 28 of 2014)
  • Tropical Commodities Supplies Ltd and Others v International Credit Bank Ltd (in Liquidation) [2004] 2 EA 331
  • Alice Wambui Nganga v. John Ngure Kahoro and another, ELC Case No. 482 of 2017 (at Thika); [2021] eKLR
  • DFCU Bank Ltd v Dr. Ann Persis Nakate Lussejere (Court of Appeal Civil Appeal No. 29 of 2003)
  • Erinford Properties Ltd v Cheshire County Council [1974] 2 All ER 448

Cases citing this judgment (1)

How later Ugandan judgments in the Wakilii corpus have cited this case. Treatment labels come from Sequitur — Uganda’s citator — each backed by a verbatim span from the citing judgment, and are not an assertion that this case is, or is not, good law.

Full judgment

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

Formular Feeds Limited and 3 Others v KCB Bank Limited (Miscellaneous Application 1647 of 2023) [2019] UGCommC 239 (13 February 2019)
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.