Wakilii

Greenland Bank (In Liquidation) v Dr Apuuli Kihumuro & Anor (HCT-00-CC-CS 790 of 2003)

High Court · [2006] UGCOMMC 62 · 2006 Preliminary Objection Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Preliminary objection at scheduling conference on limitation grounds
Decision
Matter to proceed to scheduling and hearing on the merits

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that where an overdraft was last advanced in 1995 and a demand for payment was made in 1999, the cause of action accrued at the time of demand. A suit filed in 2003 was not time barred under Limitation Act s.3(2) as the six-year limitation period runs from the date of demand, not from the date of the last advance. Further, where defendants allegedly acknowledged the debt after the initial advance, this raised a triable issue under s.24 of the Limitation Act.

Outcome

Matter to proceed to scheduling and hearing on the merits

Facts

The plaintiff bank sued the defendants to recover an overdraft debt of Shs. 68,104,587. According to the bank's pleadings, the defendants operated an account and overdrew it, with the last withdrawal recorded on 6 October 1995. The bank made a demand for payment in 1999. The defendants responded through their lawyers by letter dated 22 November 1999, making what the plaintiffs characterized as a partial admission of the claim. The suit was filed in 2003. At the scheduling conference, counsel for the defendants raised a preliminary objection that the suit was time barred under s.3(2) of the Limitation Act, arguing that more than six years had elapsed from the date of the last overdraft withdrawal in 1995.

Issues

  1. Whether the plaintiff's suit for recovery of an overdraft debt was time barred under the Limitation Act s.3(2).
  2. Whether a demand made in 1999 saved the suit from being time barred when filed in 2003.
  3. Whether an alleged acknowledgement of debt by the defendants affected the limitation period.

Orders

  • Preliminary objection overruled.
  • Case to proceed to scheduling and hearing.
  • Costs of the ruling awarded to the plaintiffs.
  • Scheduling conference set for 10 April 2006 at 11 a.m.

Rules and key headnotes

Banking Law — Recovery of Dormant Overdrafts — Limitation Period
A banker cannot recover a dormant overdraft more than six years after the last advance, unless a demand for payment was made within that period.
Loans — Repayment on Demand — Accrual of Cause of Action
Where a loan is granted without agreement as to the date of repayment, the loan is repayable on demand and the cause of action accrues on the date when demand for payment is made and ignored, not on the date when the loan was advanced.
Limitation — Acknowledgement of Debt — Effect on Limitation Period
Under s.24 of the Limitation Act, where a person liable for a debt acknowledges the claim after the right of action has accrued, the right shall be deemed to have accrued on the date of acknowledgement, and where such acknowledgement is pleaded, it becomes a triable issue that must be investigated.

Legislation cited (2)

Full judgment

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

Greenland Bank (In Liquidation) v Dr Apuuli Kihumuro & Anor (HCT-00-CC-CS 790 of 2003) [2006] UGCommC 62 (20 March 2006)
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.