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I & M Bank (Uganda) Ltd v Uganda Revenue Authority (Miscellaneous Application No. 41 of 2022)

High Court · [2023] UGCOMMC 15 · 2023 Application Dismissed — Matter Referred to Arbitration AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application to strike out civil suit on grounds that dispute should be referred to arbitration and suit is time barred
Decision
Civil suit dismissed and dispute referred to arbitration for determination on merits

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that the dismissal of CADER Arbitration Case No. 08 of 2016 was an order to terminate arbitral proceedings under section 32(2)(c) of the Arbitration and Conciliation Act, not a final arbitral award. Consequently, the underlying dispute was not determined on merits by arbitration. Given the arbitration agreement between the parties and the absence of a final award, the court dismissed the civil suit and referred the dispute back to arbitration for determination on its merits.

Outcome

Civil suit dismissed and dispute referred to arbitration for determination on merits

Facts

The applicant bank and respondent tax authority entered into a revenue collection agreement on 28 July 2010. The respondent alleged that UGX 175,283,319 received by the bank was not credited to its account. After a demand for payment in April 2021, the respondent referred the matter to arbitration in accordance with the parties' arbitration agreement. CADER Arbitration Case No. 08 of 2016 was dismissed on 2 December 2016 for failure to show sufficient interest in pursuing the matter, with costs awarded to the bank. The respondent then filed Civil Suit No. 360 of 2019 on 3 May 2019 claiming the uncredited amount. The bank brought this application to strike out the suit, arguing it was time barred and that the arbitration had determined the dispute.

Issues

  1. Whether the dispute has been determined by arbitration.
  2. Whether the suit is time barred.

Orders

  • The application is dismissed.
  • The dispute between the parties in Civil Suit No. 360 of 2019 be referred to Arbitration.
  • Civil Suit No. 360 of 2019 is dismissed.
  • Costs of this application shall be in the cause.

Rules and key headnotes

Arbitration and Conciliation Act — Termination of Arbitral Proceedings — Distinction Between Award and Order
A dismissal of arbitration proceedings for failure to show sufficient interest under section 32(2)(c) of the Arbitration and Conciliation Act is an order terminating the arbitral proceedings, not a final arbitral award. An arbitral award under section 2(1)(d) of the Act is distinct from a termination order under section 32(2).
Arbitration and Conciliation Act — Effect of Termination Order — No Determination on Merits
Where arbitral proceedings are terminated by order rather than by final award, the underlying dispute is not determined on merits and remains unresolved. A party may subsequently pursue other avenues for resolution of the dispute.
Arbitration Agreements — Enforceability — Court's Duty to Refer Disputes to Arbitration
Courts will always refer a dispute to arbitration where there is an arbitration clause in a contract and the arbitration agreement has been entered into freely and voluntarily. To depart from such an agreement requires sufficient reasons to be shown.
Civil Procedure Act — Court's Powers Under Section 98 — Referral to Arbitration
Under section 98 of the Civil Procedure Act, the court has the power to make orders necessary for the ends of justice, including dismissing a civil suit and referring the dispute to arbitration where an arbitration agreement exists between the parties.

Legislation cited (8)

Cases cited (2)

  • National Social Security Fund & Another v Alcon International Ltd (Court of Appeal Civil Appeal No. 2 of 2008)
  • Fulgensius Mungereza v Price Water House Coopers Africa Central (Supreme Court Civil Appeal No. 18 of 2002)

Full judgment

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

I & M Bank (Uganda) Ltd v Uganda Revenue Authority (Miscellaneous Application No. 41 of 2022) [2023] UGCommC 15 (17 February 2023)
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.