Kuteesa v Equity Bank Uganda Limited & Another (Miscellaneous Appeal 20 of 2024)

Observed later treatment

No later-treatment classification is recorded for this judgment.

Citator coverage is limited to judgments in the Wakilii corpus and source-matched treatment records. Absence of a signal is not an assertion that the case remains good law.

Holding

Held that under Regulation 13(1) of the Mortgage Regulations 2012, payment of 30% of the outstanding amount or forced sale value is mandatory before a court may adjourn a mortgage sale. A valuation report is not a pre-requisite for application of Regulation 13(1). The provision is designed to prevent frivolous objections while protecting the mortgagee's right to sale. The requirement applies regardless of whether the amount outstanding is disputed, and such disputes must be resolved in the main suit. The Assistant Registrar properly evaluated the evidence and correctly granted a conditional temporary injunction requiring payment of 30% of the outstanding amount claimed.

Outcome

Appeal dismissed; conditional temporary injunction requiring 30% deposit upheld

Facts

The 1st Respondent advanced a loan of UGX 924,000,000 to the Appellant secured by a mortgage over land comprised in Busiro Block 347 Plots 714 and 715 Nalumunye Wakiso District. The Appellant defaulted on the loan and the property was advertised for sale. On 24th May 2024, the Appellant instituted Civil Suit No. 634 of 2024 challenging the legality of the sale and also filed Miscellaneous Application No. 975 of 2024 seeking a temporary injunction to restrain the sale. On 10th June 2024, the Assistant Registrar granted a temporary injunction conditional upon the Appellant depositing 30% of the outstanding amount of UGX 392,758,451.93 within 14 days, failing which the Respondents could proceed with the statutory sale. The Appellant disputed the outstanding amount claimed, asserting he only owed UGX 129,669,260 and challenged the imposition of the 30% condition, arguing there was no proper valuation report, no service of statutory notices, the amount was disputed, and the suit property was matrimonial property.

Issues

1. Whether the Assistant Registrar erred in law and fact when he ordered the Appellant to deposit 30% of the outstanding amount of UGX 392,758,451.93 within 14 days without a proper valuation report of the mortgaged property on Court record.
2. Whether the Assistant Registrar erred in law and fact when he ordered a 30% payment conditional order ignoring the illegalities of the Respondents' actions of advertising the Appellant's property without complying with the statutory notices.
3. Whether the Assistant Registrar erred in law and fact when he ruled that the Respondent shall be at liberty to exercise its statutory power of sale upon failure by the Appellant to deposit the 30% with total disregard for the main suit.
4. Whether the Assistant Registrar failed to properly evaluate all the evidence on record hence arriving at a wrong decision.
5. Whether the Assistant Registrar unfairly and unjustly condemned the Appellant to deposit 30% of the outstanding amount that is in dispute.

Orders

• Appeal dismissed.
• Ruling of the Assistant Registrar in Miscellaneous Application No. 975 of 2024 delivered on 10th June 2024 upheld.
• Costs of the appeal to abide by the result of the main suit.

Rules and key headnotes

Legislation cited (12)

• Judicature Act Cap.16 s.37
• Civil Procedure Act Cap.282 s.76(1)(h)
• Civil Procedure Act Cap.282 s.80
• Civil Procedure Act Cap.282 s.98
• Civil Procedure Rules SI 71-1 Order 41 rule 1(a)
• Civil Procedure Rules SI 71-1 Order 44 rule 1(u)
• Civil Procedure Rules SI 71-1 Order 50 rule 8
• Civil Procedure Rules SI 71-1 Order 51 rules 4 and 9
• Mortgage Act 2009 s.19(1), (2) and (3)
• Mortgage Act 2009 s.26(2) and (3)
• Mortgage Regulations 2012 Regulation 11(1) and (2)
• Mortgage Regulations 2012 Regulation 13(1)

Cases cited (19)

• E.L.T Kiyimba Kaggwa v Hajji Katende Abdu Nasser (High Court Civil Suit No. 2109 of 1984)
• Parul Ben Barot v Victoria Finance Company Limited (High Court Miscellaneous Application No. 319 of 2017)
• Epaineto Mubiru v Uganda Credit and Savings Bank (Civil Suit No. 567 of 1965)
• Grace Chemutai Koech Vs Francis Kiplangat Chebiror & 2 Others [2019] eKLR
• Banco Arabe Espanol v Bank of Uganda (Supreme Court Civil Appeal No. 8 of 1998)
• Ferdsult Engineering Services Limited and Another v the Attorney General and Another (Constitutional Petition No. 18 of 2021)
• Kingston Enterprises Limited and 3 Others v Standard Chartered Bank (U) Limited (High Court Civil Appeal No. 446 of 2021)
• Ganafa Peter Kisawuzi v DFCU Bank Limited (Court of Appeal Civil Appeal No. 64 of 2016)
• Fr. Narsensio Begumisa & 3 Others v Eric Tibebaga (Supreme Court Civil Appeal No. 17 of 2002)
• Pandya Vs R (1957) E.A 336
• Kifamunte Henry v Uganda (Criminal Appeal No. 10 of 1997)
• Bogere Moses & Another v Uganda (Criminal Appeal No. 1 of 1997)
• National Insurance Corporation Vs Mugenyi and Company Advocates [1987] HCB 28
• Nakato Margaret v Housing Finance Bank Limited and Another (High Court Civil Appeal No. 687 of 2021)
• Blue Wave Beverages Limited and 2 Others v Lillian Kiiza and Another (Court of Appeal Civil Application No. 1308 of 2023)
• Namakajo Sewava Habib v KCB Bank (U) Limited and Another (High Court Miscellaneous Application No. 523 of 2023)
• I&M Bank Uganda Limited v Nadia Manji and Another (High Court Miscellaneous Application No. 18 of 2023)
• Lucy Kagoro Muramuzi v Cairo Bank Uganda Limited (High Court Miscellaneous Application No. 14 of 2023)
• Housing Finance Bank Limited v Silk Events Bank Limited and Another (High Court Civil Appeal No. 300 of 2021)

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