Wakilii

Katamba Phillip & 3 Ors v Magala Ronald (Arb Cause No 03 of 2007) (Arbitration Cause No. 3 of 2007)

High Court · [2011] UGCOMMC 65 · 2011 Objection Partly Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Objection to registration of arbitral award arising from CADER Arbitration No. 7 of 2005
Decision
Objectors' challenge to the arbitral award dismissed; award upheld and to be enforced; arbitrator's subsequent costs taxation set aside as illegal

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that rule 7 of the Arbitration Rules, providing 90 days to object to awards, contradicts section 34(3) of the Arbitration and Conciliation Act, which permits applications to set aside awards only within one month. The Act prevails. The objectors' challenge, filed over one year after receipt of the award, was time-barred. The arbitrator validly extended time under section 31(1) to hear both parties and had mandate to issue the award. However, costs taxation conducted by the arbitrator three years after the award was illegal—costs must be taxed by the Registrar under the Advocates (Remuneration & Taxation of Costs) Rules. The costs award was set aside; the underlying arbitral award was upheld.

Outcome

Objectors' challenge to the arbitral award dismissed; award upheld and to be enforced; arbitrator's subsequent costs taxation set aside as illegal

Facts

The parties were partners in Entebbe Central School. A partnership dispute arose regarding financial mismanagement. Under the partnership deed, disputes were to be referred to a single arbitrator. The respondent (Magala Ronald) applied to CADER for arbitrator appointment. Mr. Tishekwa was appointed on 30 January 2006. The arbitration process was protracted due to the objectors' lack of cooperation—they refused to endorse terms of reference, failed to attend hearings, and would not provide books for audit. The arbitrator extended time under section 31(1) and issued an award on 28 August 2006 appointing Magala as managing partner, ordering an audit, and awarding costs to the respondent. On 10 July 2009, the arbitrator taxed the respondent's bill of costs at UGX 19,780,000. The respondent obtained a warrant to arrest the objectors for non-payment; execution was later recalled. The objectors challenged the award's registration on grounds that the arbitrator's mandate had expired.

Issues

  1. Whether the procedure adopted by the objectors in bringing the objection was proper.
  2. Whether the arbitrator still had the mandate to make the award on 28 August 2006.
  3. Whether the award was illegal.
  4. Whether the arbitrator had the mandate to tax and award costs on 10 July 2009.
  5. Whether the award ought to be set aside.

Orders

  • Objection to registration of the arbitral award is dismissed.
  • The arbitral award granted in favour of the respondent by Mr. Tishekwa is upheld.
  • The costs order made by the arbitrator on 10 July 2009 is set aside as illegal.
  • The respondent shall have one half of the costs of these proceedings, as the objectors partially succeeded.

Rules and key headnotes

Arbitration & ADR — Challenge to Arbitral Awards — Time Limits for Challenge
Where the Arbitration and Conciliation Act section 34(3) provides for a one-month limitation period to apply to set aside an arbitral award and rule 7 of the Arbitration Rules provides for a 90-day period to lodge objections, the Act prevails over the Rules. An application to set aside an award filed outside the one-month statutory period is time-barred and incompetent.
Arbitration & ADR — Procedure for Challenging Awards — Method of Application
Recourse to court against an arbitral award may be made only by an application for setting aside under section 34(1) Arbitration and Conciliation Act, on the grounds stated in subsections (2) and (3). Such application must be brought by chamber summons supported by affidavit. A notice of objection alone, without a formal application, is insufficient.
Arbitration & ADR — Arbitrator's Powers — Extension of Time to Make Award
Under section 31(1) of the Arbitration and Conciliation Act, an arbitrator has discretion to extend the time for making an award from time to time by any writing signed by the arbitrator. The period for extension is not limited to a further 60 days; the arbitrator may extend time as necessary to ensure equal treatment of parties and a reasonable opportunity to present their cases.
Arbitration & ADR — Arbitrator's Mandate — Termination for Undue Delay
An arbitrator's mandate terminates under section 14(1) Arbitration and Conciliation Act if the arbitrator fails to act without undue delay. Delay caused by a party's recalcitrance, refusal to cooperate, failure to attend hearings, or non-compliance with orders does not constitute undue delay attributable to the arbitrator. Any dispute about the arbitrator's mandate must be referred to the appointing authority (CADER) under section 14(2), whose decision is final.
Arbitration & ADR — Waiver and Acquiescence — Conduct Precluding Objection
Parties who know that time for making an award has expired but continue to participate in arbitration proceedings until an award is made are by their conduct precluded from subsequently objecting to the award on the ground that it was made out of time. Such conduct amounts to waiver or acquiescence.
Arbitration & ADR — Costs of Arbitration — Taxation by Arbitrator after Award
Under section 31(9) Arbitration and Conciliation Act, costs of arbitration must be determined and apportioned by the arbitral tribunal in its award or in an additional award under section 33(5). Once an arbitrator pronounces an award without specifying the quantum of costs, the arbitrator's mandate expires. The arbitrator has no power to subsequently tax a bill of costs. Costs awarded in an arbitral award enforced as a decree must be taxed by the Registrar under the Advocates (Remuneration & Taxation of Costs) Rules.
Civil Procedure — Illegality — Court's Power to Act Suo Motu
Illegality once brought to the attention of the court overrides all questions of pleadings including admissions. Under section 98 Civil Procedure Act, the court has power to make such orders as may be necessary for the ends of justice or to prevent abuse of process, including setting aside illegal orders on its own motion.

Legislation cited (28)

Cases cited (7)

  • Makula International v Cardinal Nsubuga & Another [1982] HCB 11
  • Simbamanyo Estates Ltd v Seyani Brothers Co (U) Ltd (Miscellaneous Application No. 555 of 2002)
  • Kilembe Mines Ltd v B M Steel Ltd (Miscellaneous Cause No. 2 of 2005)
  • Uganda Lottery Ltd v Attorney General (Miscellaneous Cause No. 627 of 2008)
  • Republic v Minister for Agriculture, Ex parte W'Njuguna & Others [2006] 1 EA 356
  • Mbogo v Shah [1968] 1 EA 93
  • National Social Security Fund & W H Ssentogo T/A Ssentogo & Partners v Alcon International Ltd (Civil Appeal No. 2 of 2008)

Full judgment

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

Katamba Phillip & 3 Ors v Magala Ronald (Arb Cause No 03 of 2007) (Arbitration Cause No. 3 of 2007) [2011] UGCommC 65 (6 July 2011)
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.