Wakilii

Muhwezi-Tindyebwa v Steadfin Uganda Co-operative Savings and Credit Society Limited (Miscellaneous Application No. 286 of 2019)

Industrial Court · [2020] UGIC 15 · 2020 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for substitution of party and leave to amend claim in underlying labour dispute
Decision
Respondent substituted as party to the underlying labour dispute; applicant granted leave to amend claim

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Industrial Court held that where a cooperative society amalgamates with another to form a new entity during the pendency of litigation, the new entity may be substituted as a party under Order 24 Rule 9 of the Civil Procedure Rules. Section 25(3) of the Co-operative Societies Act provides that a resolution for amalgamation is prima facie evidence that assets and liabilities of the amalgamated societies have been transferred to the new society. The application for substitution was allowed.

Outcome

Respondent substituted as party to the underlying labour dispute; applicant granted leave to amend claim

Facts

The applicant filed a labour dispute (LDR No. 015/2018) against FSN Uganda Co-operative Society Limited. While the matter was pending before the Labour Officer, FSN amalgamated with US Embassy (U) FSN Co-operative to form Steadfin Uganda Co-operative Savings and Credit Society Limited (the respondent). The amalgamation occurred without the applicant's knowledge. The applicant then brought this application seeking to substitute the respondent for FSN in the underlying labour dispute and for leave to amend the claim. The respondent argued that FSN had been wound up and that the applicant should have applied to be on the list of creditors, and that no transfer of liabilities occurred through the merger.

Issues

  1. Whether Steadfin Uganda SACCO Ltd can be substituted as defendant in Labour Dispute Reference No. 15/2018 by way of amendment.
  2. What remedies are available to the parties.

Orders

  • Application allowed.
  • Applicant to file the necessary amendment within 14 days of the delivery of this ruling.
  • No order as to costs.

Rules and key headnotes

Civil Procedure — Substitution of Parties — Amalgamation During Pendency of Suit — Order 24 Rule 9 CPR
Where a cooperative society amalgamates with another society to form a new entity during the pendency of litigation, the new entity may be substituted as a party under Order 24 Rule 9 of the Civil Procedure Rules, which permits a suit to be continued by or against the person to or upon whom an interest has devolved.
Company Law — Co-operative Societies — Amalgamation — Transfer of Assets and Liabilities
Under Section 25(3) of the Co-operative Societies Act, an amalgamation of registered societies into one society may be effected without dissolution of the societies concerned or division of assets and liabilities, and a resolution passed for amalgamation is prima facie evidence that the assets and liabilities of the amalgamated societies have been transferred to the new society.
Civil Procedure — Substitution of Parties — Distinction Between Order 1 Rule 10 and Order 24 Rule 9
Substitution of a party under Order 1 Rule 10 of the Civil Procedure Rules (dealing with parties to the suit) is completely distinct from substitution under Order 24 Rule 9 (dealing with assignment, creation or devolution of interest during pendency of suit). The principle that a plaint must be rejected where a party has no legal existence applies to Order 1 Rule 10 substitutions, not to Order 24 Rule 9 substitutions where the original party existed at the time of filing.

Legislation cited (7)

Cases cited (4)

  • Bhangwan Dass Chopra Vs United Bank of India & Others 1988 AIR 215, 1988 SCR (1) 1088
  • Francis Rutagarama Bantariza v Habre Intern Trading Co. Ltd (Civil Appeal No. 14 of 1999)
  • The Trustees of Rubaga Miracle Centre v Mulangira Ssimba (Miscellaneous Application No. 655 of 2005)
  • Benjamin Sajjabi t/a Namataba Vs Timber Manufacturers Ltd (1978) HCB 262

Full judgment

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

Muhwezi-Tindyebwa_v_Steadfin_Uganda_Co-operative_Savings_and_Credit_Society_Limited_(Miscellaneous_Application_No._286_of_2019)_[2020]_UGIC_15_(28_August_2020)
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.