Wakilii

Plinth Technical Works Ltd v G-Great Company Ltd (MISCELLANEOUS APPLICATION NO. 060 OF 2016)

High Court · [2017] UGHCCD 166 · 2017 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for security for costs arising from a civil suit for breach of contract
Decision
Application for security for costs dismissed with costs to the respondent

Observed later treatment

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Holding

The court dismissed the application for security for costs. Held that the applicant failed to establish that the respondent's suit was frivolous or devoid of merit. Both parties presented prima facie cases requiring trial determination. Mere lack of knowledge of a plaintiff's assets does not amount to evidence of inability to pay. The court must exercise discretion judiciously and not make orders that fetter access to justice. The applicant's non-compliance with an earlier costs order weighed against granting discretionary relief.

Outcome

Application for security for costs dismissed with costs to the respondent

Facts

Plinth Technical Works Ltd was contracted by Hoima Municipal Council to construct roads. It subcontracted part of the works valued over UGX 2 billion to G-Great Company Ltd. Plinth terminated the subcontract alleging failure to complete works within stipulated time. G-Great sued Plinth in Civil Suit No. 026 of 2016 claiming UGX 2,461,547,372 as special damages for breach of contract. Plinth applied for security for costs of approximately UGX 246 million, arguing that G-Great had no known assets or physical address in Uganda, the suit was frivolous, and Plinth had a good defence. The parties disputed whether the subcontract specified time limits. G-Great alleged that Plinth failed to complete its own works under the main contract, causing delays. Plinth had filed a counterclaim. The court had previously ordered Plinth to pay UGX 1 million costs to G-Great, which remained unpaid.

Issues

  1. Whether the respondent should be ordered to furnish security for costs estimated at UGX 246,154,737.
  2. Whether the respondent's suit is frivolous and vexatious.
  3. Whether the applicant has a good defence with a likelihood of success.
  4. Whether the respondent has sufficient assets within jurisdiction to satisfy a costs order.

Orders

  • Application dismissed.
  • Costs to the respondent.

Rules and key headnotes

Civil Procedure — Security for Costs — Considerations for Exercise of Discretion
In applications for security for costs, the court must consider whether the applicant is being put to undue expenses by defending a frivolous and vexatious suit, whether the applicant has a good defence, and whether the applicant is likely to succeed. Only after these factors have been considered does the plaintiff's inability to pay costs become relevant.
Civil Procedure — Security for Costs — Assessment of Prima Facie Case
At the stage of an application for security for costs, the court must consider the prima facie case of both plaintiff and defendant. Since trial has not yet taken place, assessment of the merits can only be based on the pleadings, affidavits filed in support of or opposition to the application, and any other material available at that stage.
Civil Procedure — Security for Costs — Poverty Not Sole Ground
Mere poverty of a plaintiff is not by itself a ground for ordering security for costs. If poverty alone were sufficient, poor litigants would be deterred from enforcing their legitimate rights through the legal process.
Company Law — Security for Costs — Burden of Proof on Applicant
Under section 284 of the Companies Act, an applicant seeking security for costs from a limited company plaintiff bears the burden of satisfying the court by credible testimony that there is reason to believe the company will be unable to pay the defendant's costs if successful. Lack of knowledge of a plaintiff's assets on the part of the applicant does not amount to evidence of inability to pay.
Civil Procedure — Security for Costs — Non-Compliance with Court Orders
When a party seeks the court's discretionary power, that party must ensure full compliance with earlier court orders. A court will not exercise discretion in favour of a party who has failed to obey orders issued against them.

Legislation cited (7)

Cases cited (3)

  • Anthony Namboro and Fabiano Waburo-Lio v Henry Kaala [1975] HCB 315
  • GM Combined (U) Ltd v AK Detergents (U) Ltd (Civil Appeal No. 34 of 1995)
  • Bank of Uganda v Joseph Nsereko & 2 Others (Civil Application No. 7 of 2002)

Full judgment

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

Plinth Technical Works Ltd v G-Great Company Ltd (MISCELLANEOUS APPLICATION NO. 060 OF 2016) [2017] UGHCCD 166 (20 December 2017)
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.