Gabas Investments Limited v Exim Bank (Uganda) Limited (Miscellaneous Application 2265 of 2023)
Observed later treatment
No later-treatment classification is recorded for this judgment.
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Holding
Held that an interim order staying execution should issue where there is a pending substantive application for stay, an imminent threat of execution before the substantive hearing, and a competent appeal. The applicant satisfied all three conditions. The court granted an interim stay conditional upon the applicant depositing 30% of the outstanding loan balance within 14 days, applying Regulation 13(1) of the Mortgage Regulations 2012. Given the sale was scheduled within 24 hours of the ruling and ordinary banking transfers require 48-72 hours, the court extended the deposit timeline to 14 days. The interim order would automatically lapse if the deposit was not made by the deadline, irrespective of whether the substantive application had been determined.
Outcome
Interim stay granted conditional upon security deposit within 14 days; automatic lapse if condition not met
Facts
Gabas Investments obtained two term loans from Exim Bank totalling USD 1,090,000, secured by two properties in Entebbe on which Airport View Hotel was constructed. The loans became non-performing. The parties entered into a consent judgment on 14 December 2022 settling Civil Suit No. 404 of 2018. The applicant failed to comply with the consent terms, asserting it had believed Microfinance Support Centre would provide refinancing of UGX 1,400,000,000 but MSC changed its policy to preclude refinancing non-performing loans. Exim Bank instituted execution proceedings. The Deputy Registrar allowed execution to proceed. The applicant filed a miscellaneous appeal against that decision and sought to set aside the consent judgment on grounds of mistake. The suit land was advertised for sale by public auction scheduled for 26 October 2023. The applicant sought an interim stay of execution pending determination of the substantive stay application.
Issues
- Whether this application discloses grounds for the grant of an interim order staying execution of the Consent Judgment and Decree in the main suit.
Orders
- Subject to the deposit of a sum of money equal to 30% of the current outstanding balance of the loan within 14 (fourteen) days from the date of this ruling, an interim order doth issue staying the execution of the Consent Judgment and Decree in Civil Suit No. 404 of 2018 and all applications arising therefrom pending the disposal of Miscellaneous Application No. 2264 of 2023.
- Should the applicant fail to comply with the deposit requirement on or by Wednesday 8th November 2023, the interim order shall automatically lapse irrespective of whether Miscellaneous Application No. 2264 of 2023 will have been disposed of or not.
- Costs of this application shall abide by the outcome of Miscellaneous Application No. 2050 of 2023.
Rules and key headnotes
Legislation cited (4)
- Judicature Act Cap 13 s.33
- Civil Procedure Act Cap 71 s.98
- Civil Procedure Rules S.I. 71-1 Order 52 rules 1 and 3
- Mortgage Regulations 2012 Regulation 13(1)
Cases cited (1)
- Hon. Theodore Ssekikubo and 3 Others v Attorney General and Others (Supreme Court Constitutional Application No. 4 of 2014)
Full judgment
The original judgment as reported. Read the original PDF before relying on any passage.