Wakilii

Muhumuza Jackson v Alam Faiz and 6 Others (Civil Suit No.0055 of 2015; Miscellaneous Application No.0019 of 2024)

High Court · [2025] UGHC 1419 · 2025 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application to lift corporate veil arising from execution of consent judgment in Civil Suit No. 0055 of 2015
Decision
Corporate veil lifted; execution proceedings authorized against individual respondents

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court granted the application to lift the corporate veil of Steel Rolling Mills Ltd under Companies Act s.20, finding that the respondents were deliberately frustrating enforcement of an existing consent judgment obligation. The court held that the company was being used as a cloak to evade the decretal sum of UGX 287,999,376. The respondents' claim of an unencumbered asset was rejected as the purported certificate of title was not attached to their affidavit. Personal liability was imposed on the individual shareholders and directors to enable execution proceedings.

Outcome

Corporate veil lifted; execution proceedings authorized against individual respondents

Facts

Between 2012 and February 2015, the applicant supplied iron ore to Steel Rolling Mills Ltd (7th respondent). As of 31 March 2015, the company owed the applicant UGX 380,099,316. The applicant instituted Civil Suit No. 0055 of 2015. On 8 July 2016, a consent judgment was executed for UGX 314,999,316 to be paid in instalments. The 7th respondent paid only UGX 27,000,000, leaving UGX 287,999,376 outstanding. The company went into receivership, which was later lifted. When the applicant attempted to locate the company's premises, he was referred to different places and blocked from seeing the chairman and managing director. A URSB search revealed that respondents 1-4 were shareholders and respondents 5-6 were directors. Previous execution attempts failed when the company did not appear when summoned on 9 November 2023.

Issues

  1. Whether the corporate veil of the 7th Respondent should be lifted to enable execution proceedings against the individual respondents.
  2. Whether the conduct of the respondents constitutes fraud warranting piercing of the corporate veil.
  3. Whether the 7th Respondent is a mere facade or sham used to evade enforcement of the consent judgment.

Orders

  • An order is issued lifting the corporate veil of the 7th Respondent to enable the Applicant commence execution proceedings against the 1st, 2nd, 3rd, 4th, 5th and 6th Respondents for the enforcement of the consent Judgment and decree in H.C.S.C No. 0055 of 2015.
  • The Costs of this Application are awarded to the Applicant.

Rules and key headnotes

Company Law — Lifting the Corporate Veil — Fraud and Evasion of Existing Obligations
The doctrine of piercing the corporate veil should only be invoked where a person is under an existing obligation or liability or subject to an existing legal restriction which he deliberately evades or whose enforcement he deliberately frustrates by interposing a company under his control.
Company Law — Lifting the Corporate Veil — Company as Mere Facade or Sham
The court is entitled to look at the reality of the situation and the motive for the transaction to ascertain whether the company is a mere facade concealing the true facts, and corporate personality cannot be used as a cloak or mask for fraud.
Civil Procedure — Execution — Piercing Corporate Veil to Enforce Consent Judgment
Where respondents fail to honour a consent judgment and their conduct demonstrates an intention to avert justice and deny the applicant the fruits of judgment, the court may lift the corporate veil to enable execution proceedings against individual shareholders and directors under Companies Act s.20.
Evidence — Affidavit Evidence — Failure to Attach Purported Exhibits
Where a respondent avers in an affidavit that a document is attached as an annexure but fails to attach it, the averments relying on that document are meritless and cannot be relied upon by the court.

Legislation cited (3)

Cases cited (4)

  • D.K Construction Co Ltd and Another v Barclays Bank Uganda Ltd (Civil Suit No. 0644 of 2000)
  • Salim Jamal and 2 Others v Uganda Oxygen Ltd and 2 Others (1997) 11 KALR 38
  • Jones and Another v Lipman and Another [1962] 1 All ER 442
  • Beatrice Odongo and Another v Tamp Engineering Consultants Limited (Court of Appeal Civil Appeal No. 8 of 2020)

Full judgment

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

Muhumuza Jackson v Alam Faiz and 6 Others (Civil Suit No.0055 of 2015; Miscellaneous Application No.0019 of 2024) [2025] UGHC 1419 (13 November 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.