Wakilii

Nassimbwa v Magala & Another (Civil Suit 830 of 2022)

High Court · [2024] UGCOMMC 133 · 2024 No Order as to Costs AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Civil suit seeking declarations regarding matrimonial property and mortgage consent, resolved by partial consent judgment with residual issue of costs determination
Decision
Matter disposed of by partial consent judgment; 2nd Defendant's claim for costs dismissed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court declined to award costs to the 2nd Defendant against the 1st Defendant following a partial consent settlement. Although a loan reschedule agreement contained a costs clause, it applied only to future recovery attempts, not to costs of the settled suit. The 2nd Defendant's failure to conduct proper due diligence to obtain spousal consent from all wives of the borrower contributed to the litigation. Where parties compromise substantive matters and no special circumstances exist, each party should bear their own costs.

Outcome

Matter disposed of by partial consent judgment; 2nd Defendant's claim for costs dismissed

Facts

The Plaintiff and 1st Defendant (her husband) married in 2007 and acquired two properties as matrimonial assets in 2014 and 2015. In September 2022, the Plaintiff discovered that the properties had been advertised for public auction following the 1st Defendant's mortgage of them to the 2nd Defendant bank without her spousal consent. The 1st Defendant claimed he obtained consent from his first wife Nampiima Sarah. The 2nd Defendant contested the validity of the Plaintiff's marriage and filed a counterclaim for recovery of debt. On 26 March 2024, the parties entered a partial consent whereby the Plaintiff consented to the mortgage and the 2nd Defendant rescheduled the loan. The 2nd Defendant then sought costs from the 1st Defendant based on a clause in the loan reschedule agreement.

Issues

  1. Whether the 2nd Defendant is entitled to the costs of the suit from the 1st Defendant

Orders

  • Costs of the suit to the 2nd Defendant declined.
  • Each party to bear their own costs of the suit.

Rules and key headnotes

Civil Procedure — Costs — Discretion of Court — Consent Settlements
Where parties have compromised all substantive matters by consent and there are no special circumstances, it is just and appropriate for each party to bear their own costs even where one party may be considered technically successful.
Civil Procedure — Costs — Contractual Costs Provisions — Temporal Application
A costs clause in a loan reschedule agreement that refers to costs incidental to recovery or attempted recovery of monies owing under the rescheduled facility applies prospectively to future recovery attempts and cannot be relied upon to claim costs of litigation that preceded the reschedule agreement and was settled by consent.
Banking & Finance — Mortgage — Spousal Consent — Lender's Due Diligence Obligations
A mortgagee bank that fails to conduct proper due diligence under Section 6 of the Mortgage Act 2009 and Regulation 3 of the Mortgage Regulations 2012 to ascertain details of all spouses of a borrower in a polygamous marriage and obtain required spousal consent cannot be deemed a successful party where litigation ensues from that failure, even if the mortgage is subsequently ratified by consent.
Family Law — Matrimonial Property — Spousal Consent — Subsequent Ratification
Where a spouse mortgages matrimonial property without the required spousal consent under the Mortgage Act 2009 and the aggrieved spouse subsequently consents to legalise the mortgage under Section 5 of the Mortgage Act, the matter may be disposed of by consent with each party bearing their own costs in the absence of special circumstances.

Legislation cited (9)

Cases cited (7)

  • Katon Manufacturers Limited v Liao Ning Middle East and Paper Company Limited (Miscellaneous Application No. 432 of 2010)
  • Andrew Akol Jacha v Noah Doka Onzivua (High Court Civil Appeal No. 1 of 2014)
  • Candiru v Amandua and 2 Others (Civil Suit No. 0019 of 2014)
  • Sebuliba v Co-operative Bank Ltd [1982] HCB 129
  • Uganda Development Bank v Muganga Construction Co. Ltd [1981] HCB 35
  • Harry Ssempa v Kambagambire David (High Court Civil Suit No. 408 of 2014)
  • Lyamuleme David v Attorney General (Supreme Court Civil Appeal No. 4 of 2013)

Full judgment

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

Nassimbwa v Magala & Another (Civil Suit 830 of 2022) [2024] UGCommC 133 (18 April 2024)
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.