Wakilii

In the matter of a Petition for a receiving Order by Thomas I. Kato ( A Debtor) (Bankruptcy Petition 13 of 2002)

High Court · [2002] UGCOMMC 24 · 2002 Application Partly Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Bankruptcy petition filed by debtor seeking receiving order under Bankruptcy Act
Decision
Receiving order issued; debtor's estate placed under Official Receiver; stay of proceedings refused

Observed later treatment

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Holding

The High Court granted a receiving order for the debtor's estate upon finding that the debtor satisfied procedural requirements, proved indebtedness through attached court judgments totalling over UGX 2.5 billion, and committed an act of bankruptcy by filing the petition declaring inability to pay debts. The Court refused to stay proceedings against the debtor for lack of sufficient particulars regarding pending actions. The UK Bankruptcy Rules 1915 apply in Uganda with necessary local adaptations.

Outcome

Receiving order issued; debtor's estate placed under Official Receiver; stay of proceedings refused

Facts

Thomas I. Kato filed a bankruptcy petition seeking a receiving order against his estate and a stay of all pending proceedings. He declared inability to pay debts totalling over UGX 2.5 billion owed to two creditors: International Credit Bank (approximately UGX 2.369 billion arising from HCCS No. 212/2001) and Nile Bank (UGX 145.784 million arising from HCCS No. 685/99). Both debts were evidenced by court judgments attached to the petition. The debtor submitted a Statement of Affairs verified by affidavit and complied with procedural requirements including attestation by a notary public and deposit of the prescribed sum.

Issues

  1. Whether the debtor had satisfied the procedural requirements for filing a bankruptcy petition under the Bankruptcy Act.
  2. Whether the debtor had proved his indebtedness to creditors.
  3. Whether the debtor had committed an act of bankruptcy.
  4. Whether the Court should exercise its discretion to stay all pending court actions, execution and other legal processes against the debtor.

Orders

  • Receiving order for the protection of the estate of the Debtor/Petitioner, Mr. Thomas I. Katto, issued.
  • The Official Receiver is constituted receiver of the estate of Mr. Thomas I. Katto.
  • Mr. Thomas I. Katto is required to immediately attend the Official Receiver at his offices at the Companies Registry in Kampala.
  • The prayer for an order to stay all pending court actions, execution and other legal processes against the debtor and his property is refused.
  • Costs of this petition shall be costs in the cause.

Rules and key headnotes

Bankruptcy — Debtor's Petition — Procedural Requirements
A debtor's bankruptcy petition must be brought pursuant to sections 3(1)(f), 5 and 8 of the Bankruptcy Act, accompanied by a Statement of Affairs verified by affidavit showing particulars of assets, debts, liabilities, creditors, securities and their dates, submitted not more than three days before presentation of the petition, and attested by a notary public with the prescribed deposit made at time of presentation.
Bankruptcy — Application of UK Bankruptcy Rules — Local Adaptation
The UK Bankruptcy Rules 1915 are applicable in Uganda by virtue of section 164 of the Bankruptcy Act and shall be read with such verbal alterations not affecting the substance as may be deemed expedient to render them applicable to local circumstances, including accepting deposit in Uganda Shillings instead of British Pounds.
Bankruptcy — Act of Bankruptcy — Self-Petition
A debtor commits an act of bankruptcy by filing a declaration of inability to pay debts or presenting a bankruptcy petition against himself under section 3(1)(f) of the Bankruptcy Act, and the presentation of a debtor's petition alleging inability to pay debts is deemed an act of bankruptcy without previous filing of any declaration.
Bankruptcy — Receiving Order — Mandatory Issuance
Where a debtor has committed an act of bankruptcy and filed a statement of affairs in accordance with section 16 of the Bankruptcy Act, the court shall make a receiving order upon a debtor's petition alleging inability to pay debts, subject to the debtor proving indebtedness and having committed an act of bankruptcy.
Bankruptcy — Stay of Proceedings — Discretionary Power
The power to stay actions, execution or other legal processes against a debtor under section 11 of the Bankruptcy Act is discretionary, and the court will not exercise that discretion where the petitioner fails to provide reasons for the stay or particularise the number, nature and forum of allegedly pending proceedings.

Legislation cited (14)

  • Bankruptcy Act Cap. 71 s.3(1)(f)
  • Bankruptcy Act Cap. 71 s.5
  • Bankruptcy Act Cap. 71 s.8
  • Bankruptcy Act Cap. 71 s.8(1)
  • Bankruptcy Act Cap. 71 s.11
  • Bankruptcy Act Cap. 71 s.11(1)
  • Bankruptcy Act Cap. 71 s.11(2)
  • Bankruptcy Act Cap. 71 s.16
  • Bankruptcy Act Cap. 71 s.16(1)
  • Bankruptcy Act Cap. 71 s.16(2)
  • Bankruptcy Act Cap. 71 s.164
  • Bankruptcy Rules 1915 (UK) Rule 148
  • Bankruptcy Rules 1915 (UK) Rule 149
  • Bankruptcy Rules 1915 (UK) Rule 166(1)

Cases cited (2)

  • Ex parte Painter [1895] 1 QB 85
  • Wavamunno v Sezi Teddy Cheeye (Bankruptcy Petition No. 1 of 1995)

Full judgment

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

In the matter of a Petition for a receiving Order by Thomas I. Kato ( A Debtor) (Bankruptcy Petition 13 of 2002) [2002] UGCommC 24 (11 October 2002)
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.