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National Enterprises Corporation v Mukisa Foods Limited (Miscellaneous Civil Application No. 07 98)

Court of Appeal · [1998] UGCA 67 · 1998 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Second application to the Court of Appeal for stay of execution pending appeal, after a conditional grant by the High Court
Decision
Stay of execution granted; respondent restrained from disposing of the suit machinery pending disposal of Civil Appeal No. 42 of 1997

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Court of Appeal held that the High Court order requiring deposit of security was not consented to — only the stay itself was consented to — so res judicata did not arise. Applications for stay of execution pending appeals from the High Court are governed by Rule 5(2)(b) of the Court of Appeal Rules, not Order 39 r.4(3) of the Civil Procedure Rules, which governs only appeals to the High Court. The applicant acted reasonably in applying afresh rather than appealing, avoiding delay. Exercising its wider discretion, the Court granted the stay, accepting the suit machinery deposited into court as security, and restrained the respondent from disposing of it pending appeal.

Outcome

Stay of execution granted; respondent restrained from disposing of the suit machinery pending disposal of Civil Appeal No. 42 of 1997

Facts

An ex-parte decree was entered against the applicant in HCCS No. 974 of 1992 on 29 May 1996 for Shs. 360,000,000. The applicant's effort to set the decree aside was dismissed with costs on 15 October 1997. On 14 November 1997 the High Court granted a stay of execution pending appeal on condition that the applicant deposit the decretal sum and costs of Shs. 9,868,950 in court by 15 December 1997 as security. The applicant, a Government corporation, could not obtain the colossal sum from the Treasury by the deadline. It offered to deposit the suit machinery (the subject matter of the suit, situated in a prime Industrial Area location) as security, but the judge rejected the offer. Having already filed Civil Appeal No. 42 of 1997, the applicant brought a fresh application to the Court of Appeal for stay, contending that selling the machinery to raise the cash would render the appeal nugatory since the appeal sought to retain the machinery.

Issues

  1. Whether the High Court order requiring deposit of security as a condition for stay of execution was entered by consent and thus res judicata.
  2. Whether an application for stay of execution pending appeal to the Court of Appeal is governed by Order 39 r.4(3) of the Civil Procedure Rules or by Rule 5(2)(b) of the Court of Appeal Rules.
  3. Whether the applicant should have appealed the High Court order rather than bringing a fresh application to the Court of Appeal.
  4. Whether the Court should grant a stay of execution and on what terms as to security.

Orders

  • The application is granted as prayed.
  • The respondent is restrained from selling, alienating or otherwise disposing of the suit machinery till final disposal of the appeal.
  • The Registrar is directed to list the appeal for hearing soonest.
  • Each party to bear its own costs.

Rules and key headnotes

Civil Procedure — Stay of Execution — Consent Orders and Res Judicata
Where a court order grants a stay of execution by consent but imposes a separate condition as to security that was not agreed by the parties, only the consented stay is binding as a consent order; the security condition is the court's own order and does not give rise to res judicata.
Civil Procedure — Stay of Execution — Applicable Rules — Court of Appeal Rules v Order 39 CPR
An application for stay of execution pending an appeal from the High Court to the Court of Appeal is governed by Rule 5(2)(b) of the Court of Appeal Rules, not by Order 39 r.4(3) of the Civil Procedure Rules, which governs only appeals to the High Court.
Civil Procedure — Stay of Execution — Scope of Court of Appeal's Discretion as to Security
The Court of Appeal's powers under Rule 5(2)(b) are wider than the High Court's under Order 39, and the Court may set such terms as to security as it thinks just, including accepting the suit property itself as security rather than the cash decretal sum.
Civil Procedure — Stay of Execution — Choice Between Fresh Application and Appeal
Where the High Court has made an error apparent on the record or otherwise failed to deal adequately with a stay application, an applicant may apply afresh to the Court of Appeal rather than appeal, the aim being to have stay applications speedily heard and delay avoided.
Civil Procedure — Stay of Execution — Principle Against Rendering Appeal Nugatory
As a general rule a stay of execution should be granted where, once the decretal property is disposed of, there is no likelihood of recovering it should the appeal succeed; the court ought to exercise its discretion so as not to render a successful appeal nugatory unless the case is exceptional.

Legislation cited (3)

  • Rules of the Court of Appeal r.5(2)(b)
  • Rules of the Court of Appeal r.42
  • Civil Procedure Rules O.39 r.4(3)

Cases cited (5)

  • Lawrence M. Kyazze v Eunice Busingye (Civil Appeal No. 18 of 1990)
  • Kisugu Quarries Ltd v Attorney General (Miscellaneous Application No. 446 of 1995)
  • Francis Sembuya v Allports Freight Service Ltd (Civil Application No. 11 of 1997)
  • Cropper v Smith (1883) 24 Ch D 305
  • Wilson v Church (No.2) (1879) 12 Ch D 454

Full judgment

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National Enterprises Corporation v Mukisa Foods Limited (Miscellaneous Civil Application No. 07 98) [1998] UGCA 67 (29 April 1998)
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.