Wakilii

Magandaazi v Millard (Miscellaneous Application 249 of 2025)

High Court · [2025] UGHCLD 66 · 2025 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Interlocutory application for security for costs arising from civil suit for fraudulent expropriation of company property
Decision
Application for security for costs dismissed with costs to the respondent

Observed later treatment

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Holding

The court dismissed the application for security for costs. The applicant failed to establish that the respondent's suit was frivolous or vexatious, as the pleadings disclosed a prima facie case of fraudulent expropriation of company property by a director. The respondent's foreign residence and lack of property in Uganda, without proof of impecuniosity or bad faith, were insufficient grounds to order security for costs, particularly where the applicant's own conduct allegedly contributed to the dispute.

Outcome

Application for security for costs dismissed with costs to the respondent

Facts

The applicant, Magandaazi Denis, applied for an order requiring the respondent, Monica Millard, to furnish security for costs of UGX 30,000,000 before the hearing of the main suit (HCCS No. 1133 of 2024). The main suit concerned land comprised in Block 423 Plot 642, which had been subdivided into multiple plots registered in the applicant's name. The applicant argued that the respondent was a foreigner with no known property in Uganda, making enforcement of a costs order difficult if she lost. He further contended that the suit was frivolous and vexatious because the suit land no longer existed as described, the first defendant company had been struck off the register, and the company was allegedly a foreign entity prohibited from owning mailo land. The respondent countered that she held 50% of shares in the first defendant company (with the remaining 50% held by Ugandan citizens), that the company had been reinstated, that her claim was based on proprietary rights arising from fraudulent expropriation of company property by the applicant as director, and that she was financially sound with assets in the United States against which any judgment could be enforced.

Issues

  1. Whether there are sufficient grounds for granting an order for security for costs against a plaintiff who is a foreign national with no known property in Uganda.

Orders

  • Application dismissed.
  • Costs awarded to the Respondent.

Rules and key headnotes

Civil Procedure — Security for Costs — Discretionary Power — Exercise in Special Circumstances
The power to order security for costs under Order 26 rule 1 of the Civil Procedure Rules is purely discretionary and must be exercised in very special circumstances, taking into account the nature, purpose and circumstances of the case.
Civil Procedure — Security for Costs — Frivolous and Vexatious Suits — Assessment of Prima Facie Case
In determining whether to grant security for costs, the court must consider whether the applicant is being put to undue expense by defending a frivolous and vexatious suit, and whether the applicant has a good defence and is likely to succeed. The assessment is based on the pleadings, affidavits, and other material available at the interlocutory stage, without conducting a full trial on the merits.
Land & Property — Foreign Ownership — Corporate Bodies — Controlling Interest Test
Under Section 41 of the Land Act, a corporate body is deemed a non-citizen if the controlling interest lies with non-citizens. Controlling interest in a company with shares means the majority of shares are held by non-citizens. Where shares are held equally (50% by a non-citizen and 50% by citizens), the company is not a foreign company and may lawfully acquire mailo land.
Civil Procedure — Security for Costs — Plaintiff's Impecuniosity — Not Sole Ground for Order
Impecuniosity of the plaintiff is not a sufficient basis for ordering security for costs. An order on this ground alone would prevent access to justice based on a party's pecuniary position, contrary to the principle that poverty must not be a bar to litigation.
Civil Procedure — Security for Costs — Foreign Plaintiff — Difficulty of Enforcement Insufficient Ground
The fact that a plaintiff resides abroad and has no property in the jurisdiction, making enforcement of a costs order potentially difficult or expensive, does not per se justify an order for security for costs. The applicant must establish lack of good faith, intention to evade payment of costs, or that the plaintiff is impecunious and unable to pay costs if ordered to do so.

Legislation cited (7)

Cases cited (7)

  • G.M. Combined (U) Ltd v A.K Detergents Ltd [1997] HCB 40
  • Anthony Namboro & Fabiano Waburoko v Henry Kaala [1975] HCB 324
  • R v Ajit Singh s/o Vir Singh (1957) EA 822
  • Salim Jamal & 2 Others v Uganda Oxygen Limited and Anor (Supreme Court Civil Appeal No. 64 of 1995)
  • Peter Katutsi v Sulaiman Mukasa & Sons Limited and Anor (Miscellaneous Application No. 268 of 2021)
  • Speke Hotel 1996 Limited v Shiela Nadege (High Court Miscellaneous Application No. 4 of 2022)
  • Gateway Land Pte Ltd v Turner (East Asia) Pte Ltd [1987] SLR (R) 746

Full judgment

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

Magandaazi_v_Millard_(Miscellaneous_Application_249_of_2025)_[2025]_UGHCLD_66_(29_May_2025)
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.