Wakilii

Phoenix of Uganda Assurance Company Limited v Kuti Investments Limited and Another (Miscellaneous Application 679 of 2023)

High Court · [2023] UGCOMMC 107 · 2023 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for leave to amend Written Statement of Defence and file counterclaim in ongoing civil suit
Decision
Application granted with directions for amended pleadings to be filed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court granted Phoenix of Uganda Assurance Company leave to amend its Written Statement of Defence and file a counterclaim alleging fraud in an insurance claim. The court held that although the application was brought late and introduced new claims, the allegations of fraud were serious and required adjudication in the interest of justice. The amendment would determine the real controversy between the parties without prejudicing the Respondents' rights, as any injustice could be compensated by costs.

Outcome

Application granted with directions for amended pleadings to be filed

Facts

In 2015, the 1st Respondent reported two accidents involving vehicle UAW 826G to the Applicant insurer. The Applicant compensated both claims. The 1st Respondent subsequently obtained a loan from the 2nd Respondent secured by the vehicle. When the 2nd Respondent sued for loan recovery, the 1st Respondent counterclaimed against the Applicant for inadequate compensation. During trial, when the Applicant sought certification of the vehicle inspection report from Nakapiripiriti Police, it learned the report submitted by the 1st Respondent and relied upon for the second claim payment was allegedly forged. The Applicant then sought leave to amend its defence to plead fraud and file a counterclaim to recover the money paid on the fraudulent claim (UGX 24,613,260). Both Respondents opposed, arguing the application was late, prejudicial, and introduced a new cause of action.

Issues

  1. Whether the Applicant should be granted leave to amend its Written Statement of Defence and file a counterclaim.
  2. Whether the 2nd Respondent's Affidavit in Reply was properly filed and served.
  3. Whether the 1st Respondent's Affidavit in Reply contains falsehoods warranting it being struck out.

Orders

  • Application granted.
  • Applicant granted leave to amend its Written Statement of Defence and file a counterclaim.
  • Amended Written Statement of Defence and counterclaim to be filed and served on Respondents within 15 days of the Ruling.
  • Respondents to file their amended pleadings within 15 days from the last date on which the Applicant should have served them.
  • Costs of the Application to follow the main cause.

Rules and key headnotes

Civil Procedure — Amendment of Pleadings — Principles for Granting Leave
A court may at any stage of proceedings allow a party to amend pleadings where the amendment would allow determination of the real question in controversy between the parties, does not prejudice the rights of the opposite party, is not brought in bad faith, and any injustice can be compensated by costs.
Civil Procedure — Amendment of Pleadings — New Claims Arising from Same Facts
Where a party seeks to introduce a new claim based on subsequent developments that fall within the same facts or series of events constituting the basis of the initial claim, amendment should be permitted to allow adjudication of the real controversy.
Civil Procedure — Amendment of Pleadings — Allegations of Fraud and Illegality
Where an applicant makes serious allegations of fraud and illegality, the court in the interest of justice cannot turn a blind eye to such allegations, even where the application to amend is brought late in the proceedings.
Insurance — Motor Insurance — Fraudulent Claims — Right to Recover Payments
An insurer who pays out a claim in good faith but subsequently discovers that the claim was based on forged documentation is entitled to seek recovery of the payment made, as no person should be allowed to keep an advantage obtained by fraud.

Legislation cited (3)

Cases cited (8)

  • Gaso Transport Services (Bus) Ltd v Obene (SCCA No. 4 of 1994)
  • Okello Wilbert v Obel Ronald (HCMA No. 97 of 2020)
  • Jas Progressive Investment (U) Ltd v Tropical Africa Bank Ltd (HCCS No. 78 of 2011)
  • Daniel Kayizi v Rince Muhammed Kayondo (Miscellaneous Application No. 387 of 2016)
  • Mulowooza & Brothers Ltd v Shah & Co Ltd (SCCA No. 26 of 2010)
  • Col Besigye Kizza v Museveni Yoweri & Electoral Commission (Election Petition No. 1 of 2001)
  • Bakalumba Enterprises Limited v Uganda Breweries Limited (Miscellaneous Application No. 817 of 2021)
  • Makula International Ltd v His Eminence Cardinal Nsubuga & Anor [1982] HCB 11

Full judgment

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

Phoenix of Uganda Assurance Company Limited v Kuti Investments Limited and Another (Miscellaneous Application 679 of 2023) [2023] UGCommC 107 (4 October 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.