Wakilii

Peter Katutsi v Sulaiman Mukasa and Sons Limited and Anor (Civil Miscellaneous Application No. 268 of 2021)

High Court · [2021] UGHCCD 28 · 2021 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for security for costs arising from Originating Summons seeking interpretation of deed of settlement and order for accounting
Decision
Application dismissed with costs to the respondents.

Observed later treatment

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Holding

The High Court dismissed an application by a former advocate for an order requiring his former clients, two companies, to furnish security for costs in proceedings where they sought an accounting of judgment proceeds he had received on their behalf. The court held that where a defendant is responsible for or contributed to the plaintiff's impecuniosity, and where the plaintiff has a reasonable chance of success, security for costs should not be ordered. The application was found to be oppressive and designed to stifle the companies' access to justice.

Outcome

Application dismissed with costs to the respondents.

Facts

The applicant, Peter Katutsi, was an advocate who represented plaintiffs in HCCS No. 103 of 2010, a suit in which compensation was awarded for land taken by government. The respondent companies were proprietors of ranches for which compensation was awarded. Katutsi received approximately UGX 19 billion from the Ministry of Finance on behalf of his clients. A deed of settlement was subsequently executed regarding distribution of these funds. The respondent companies brought Originating Summons No. 002 of 2020 seeking interpretation of the deed and an order that Katutsi account for and remit the money he had received on their behalf. Katutsi applied for security for costs, alleging that the respondents were impecunious shell companies with no postal address or assets, and that their claim was frivolous. The respondents opposed the application, contending that any impecuniosity was attributable to Katutsi's refusal to remit their money, and that they owned valuable ranch properties.

Issues

  1. Whether the respondents should furnish security for costs in Originating Summons No. 002 of 2020.

Orders

  • Application for security for costs dismissed.
  • Costs of the application awarded to the respondents.

Rules and key headnotes

Civil Procedure — Security for Costs — Impecuniosity of Plaintiff — Defendant's Contribution to Plaintiff's Impecuniosity
Where a defendant is responsible for or has contributed to the plaintiff's impecunious status, this is a relevant factor against ordering security for costs, particularly if the plaintiff's claim has a reasonable chance of success.
Civil Procedure — Security for Costs — Companies — Limited Liability Shield
It is necessary to distinguish between impecunious companies and natural persons for purposes of security for costs because of the potential harm or abuse which may arise when a company is used to initiate litigation behind the cover of limited liability, but where the companies are bona fide aggrieved parties and have not used the company shield to insulate themselves against recovery of costs, this factor does not favour granting security.
Civil Procedure — Security for Costs — Access to Justice — Oppressive Applications
An application for security for costs will be dismissed where it is being used oppressively to stifle a party's access to justice, particularly where the respondent is seeking an accounting from a former advocate who received substantial sums on their behalf.
Civil Procedure — Security for Costs — Lack of Postal Address — Prior Knowledge
A defendant who previously represented the plaintiff and was fully aware of the plaintiff's address at all material times should not be allowed to raise lack of postal address as a ground for security for costs, and there must be evidence that the plaintiff intentionally changed address to evade payment of costs.
Civil Procedure — Security for Costs — Impecuniosity Alone Insufficient — Access to Justice
The impecuniosity of the plaintiff is not always a basis on which the court would order security for costs, as such an order on this ground alone would prevent access to justice because of a party's pecuniary position and may be arbitrary, since poverty must not be a bar to litigation.

Legislation cited (4)

Cases cited (4)

  • G.M. Combined (U) Ltd v A.K. Detergents (U) Ltd (Supreme Court Civil Appeal No. 34 of 1995)
  • Elbow Holdings Pte Ltd Marina Bay Sands Pte Ltd [2014]SGHC 219
  • Ho Wong On Christopher v ECRC Land Pte Ltd [2006] 4 SLR (R) 817
  • Sembawang Engineering Pte Ltd v Priser Asia Engineering Pte Ltd [1992] 2 SLR (R) 358

Full judgment

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Peter Katutsi v Sulaiman Mukasa and Sons Limited and Anor (Civil Miscellaneous Application No. 268 of 2021) [2021] UGHCCD 28 (27 April 2021)
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.