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Maroola Technology -SMC Ltd (Commonwealth Technologies Ltd) v Uganda Investment Authority (Miscellaneous Application 2154 of 2023)

High Court · [2023] UGCOMMC 126 · 2023 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for interim measure of protection in support of arbitration proceedings, raised under Arbitration and Conciliation Act Cap 4
Decision
Application dismissed with costs to the respondent for violating the lis pendens rule and constituting an abuse of court process

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court dismissed the application for an interim measure of protection sought under the Arbitration and Conciliation Act. The court held that the application violated the lis pendens rule because the applicant had already filed applications for temporary and interim injunctions in the Civil Division concerning the same subject matter and parties. The court further found that there was no valid arbitration agreement, as the respondent had rejected arbitration and the lease agreement did not mandate it. The application was therefore an abuse of court process.

Outcome

Application dismissed with costs to the respondent for violating the lis pendens rule and constituting an abuse of court process

Facts

The applicant and respondent entered into a commercial lease agreement in 2016 for land at Namanve, initially for five years, later renewed for one year until 28 June 2023. On 27 June 2023, the applicant applied for lease renewal, which the respondent rejected. The applicant then filed a judicial review application in the High Court Civil Division seeking a permanent injunction, along with two miscellaneous applications for temporary and interim injunctions to prevent the respondent from interfering with the land. Separately, the applicant filed the instant application in the Commercial Division seeking an interim measure of protection pending arbitration. On 18 September 2023, the respondent rejected the applicant's attempt to commence arbitration, arguing the applicant had chosen court adjudication. The respondent raised preliminary objections based on lis pendens and abuse of process.

Issues

  1. Whether the application offends the lis pendens rule and is barred by law under Section 6 of the Civil Procedure Act.
  2. Whether the application constitutes an abuse of court process.
  3. Whether there exists a valid arbitration agreement between the parties.
  4. Whether the court can grant interim measures of protection in the absence of agreed arbitration proceedings.

Orders

  • Application dismissed.
  • Costs awarded to the respondent.

Rules and key headnotes

Civil Procedure — Lis Pendens — Application of Section 6 of the Civil Procedure Act — Requirements to Establish Lis Pendens
For the lis pendens rule under Section 6 of the Civil Procedure Act to apply, three conditions must be satisfied: (1) the matter in issue in the present application must be directly and substantially in issue in a previously instituted suit or proceeding; (2) the previously instituted suit or proceeding must be between the same parties; and (3) the suit or proceeding must be pending in the same or any other court having jurisdiction to grant the relief claimed.
Civil Procedure — Lis Pendens — Multiple Applications Seeking Same Relief — Bar on Subsequent Application
Where an applicant has filed applications for temporary and interim injunctions in one division of the High Court seeking protection of the same land from the same respondent, a subsequent application in another division seeking substantially the same interim relief violates the lis pendens rule and must be dismissed, even if the applications arise from different legal bases.
Arbitration & ADR — Arbitration Agreement — Requirement of Mutual Agreement — Rejection of Arbitration by One Party
A valid arbitration agreement requires mutual consent of the parties. Where a lease agreement provides that disputes may be settled by any means authorised by law and one party rejects arbitration as the dispute resolution method, there is no valid arbitration agreement and no arbitration proceedings exist.
Arbitration & ADR — Interim Measures — Conditions for Court to Grant Interim Measures under Arbitration and Conciliation Act
For a court to grant interim measures of protection under the Arbitration and Conciliation Act, there must be an arbitration agreement between the parties and either pending arbitral proceedings or an application made before commencement of arbitral proceedings by a party to that agreement. The applicant must be a party to the agreement giving rise to the arbitration proceedings.
Civil Procedure — Abuse of Court Process — Filing Multiple Suits on Same Subject Matter in Different Divisions
The filing of multiple applications in different divisions of the High Court seeking essentially the same relief against the same respondent regarding the same subject matter constitutes an abuse of court process, which the court is empowered to curb under Section 33 of the Judicature Act and Section 98 of the Civil Procedure Act.
Commercial Law — Investment Code Act 2019 — Dispute Resolution — Arbitration Not Mandatory
Section 25(2) of the Investment Code Act 2019 provides that a dispute between an investor and the Authority which is not settled through negotiations may be submitted to arbitration as may be mutually agreed by the parties. The use of the word 'may' indicates that arbitration is not mandatory, and the method must be mutually agreed upon by the parties.

Legislation cited (10)

Cases cited (7)

  • Mukisa Biscuit Manufacturing Co v West End [1969] EA 696
  • Shumuk Springs Development Ltd and 3 Others v Bonney Mwebesa Katatumba and 6 Others (Civil Suit No. 375 of 2009)
  • Jadva Karsan v Harnam Singh Bhogal [1953] 20 EACA 74
  • Krone Uganda Limited v Kerilee Investment Ltd (Miscellaneous Application No. 306 of 2019)
  • Attorney General v James Mark Kamoga and Another (Supreme Court Civil Appeal No. 8 of 2004)
  • Eco-Friendly Farming Ltd v Uganda Investment Authority (Civil Suit No. 604 of 2014)
  • Pan-Afric Impex (U) Ltd v Barclays Bank Plc and Absa Bank Ltd (Miscellaneous Application No. 804 of 2007)

Full judgment

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

Maroola Technology -SMC Ltd (Commonwealth Technologies Ltd) v Uganda Investment Authority (Miscellaneous Application 2154 of 2023) [2023] UGCommC 126 (23 October 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.