Wakilii

Mulagwe v Bank of Uganda (Miscellaneous Appeal 27 of 2022)

High Court · [2023] UGCOMMC 75 · 2023 Appeal Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from the ruling of the Deputy Registrar in a garnishee application arising from enforcement of a money decree
Decision
The garnishee order absolute for UGX 168,482,970 stands. Appellant's request to enhance the award to UGX 220,539,678 refused.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that Bank of Uganda lawfully converted foreign currency seized from Lanex Forex Bureau to Uganda Shillings pursuant to its statutory mandate under the Bank of Uganda Act. The appropriate exchange rate is the rate at the time of breach of contract (2003), not the rate at the date of decree nisi. Appeal dismissed.

Outcome

The garnishee order absolute for UGX 168,482,970 stands. Appellant's request to enhance the award to UGX 220,539,678 refused.

Facts

The Appellant obtained a money decree against Lanex Forex Bureau Limited in HCCS No. 358 of 2006. Bank of Uganda, as regulator, seized various foreign currencies from Lanex Forex Bureau's premises in November 2005 totalling approximately USD 160,000 plus other currencies. In March 2014, Bank of Uganda converted these foreign currencies to Uganda Shillings at the then-prevailing rate, resulting in UGX 168,482,970. The Appellant applied for a garnishee order to attach these funds. The Deputy Registrar issued a garnishee order absolute for UGX 168,482,970. The Appellant appealed, arguing the conversion was illegal and that the funds should be valued at the current exchange rate (UGX 220,539,678) at the date of the garnishee order nisi.

Issues

  1. Whether the appeal was filed within time.
  2. Whether the Registrar erred in issuing a garnishee order absolute for UGX 168,482,970 based on an allegedly illegal conversion of foreign currency.
  3. Whether the appropriate exchange rate for conversion should be the rate at the date of the decree nisi or the rate at the time of conversion.
  4. Whether the Registrar failed to evaluate evidence regarding the total amount held by the Respondent.

Orders

  • Appeal dismissed.
  • Decision of the Deputy Registrar upholding garnishee order absolute for UGX 168,482,970 affirmed.
  • Costs of the appeal awarded to the Respondent.

Rules and key headnotes

Civil Procedure — Appeals from Registrar — Time Limits
An appeal against a decision of a Registrar under the Civil Procedure Act s.79(1)(b) must be entered within seven days from the date of the Registrar's order.
Banking & Finance — Central Bank Powers — Currency Conversion
Bank of Uganda, in exercise of its constitutional mandate under Article 162 and statutory functions under the Bank of Uganda Act s.17, has the power to convert foreign currency to Uganda Shillings where it holds such currency in its supervisory capacity, particularly to prevent demonetization loss.
Banking & Finance — Currency Exchange Rates — Applicable Date
Where money is held by a third party pursuant to enforcement proceedings, and the third party converts foreign currency to local currency in exercise of statutory powers, the appropriate exchange rate for valuation is the rate at the time of the original breach of contract giving rise to the debt, not the rate at the date of the garnishee order nisi.
Administrative Law — Central Bank — Supervisory Powers
Bank of Uganda, as regulator of foreign exchange bureaus, acts in its supervisory capacity when it seizes and holds funds from regulated entities. In such circumstances, absent illegality, fraud, or malice, it is not required to compensate a judgment creditor beyond the actual value of the currency at the time it was seized.

Legislation cited (8)

Cases cited (1)

  • Di Ferdinando v Simon, Smits [1920] 3 KB 409

Full judgment

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

Mulagwe v Bank of Uganda (Miscellaneous Appeal 27 of 2022) [2023] UGCommC 75 (8 September 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.