Wakilii

Ratidu Trading Ltd and Others v Equity Bank (U) Ltd (Miscellaneous Application 2646 of 2023)

High Court · [2025] UGCOMMC 56 · 2025 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for unconditional leave to appear and defend a summary suit for recovery of loan debt
Decision
Application dismissed; judgment entered for the respondent bank for the outstanding loan sum of UGX 1,317,881,432.26

Observed later treatment

Cited — treatment unverified cited in 2 (treatment unverified) Sequitur — Uganda’s citator · Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

Citator coverage is limited to judgments in the Wakilii corpus and source-matched treatment records. Absence of a signal is not an assertion that the case remains good law.

No adverse treatment recorded Cited 2 times with no adverse treatment recorded; not yet tested on the merits. Derived from citing cases in the Wakilii corpus — a deterministic signal, not legal advice.

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions—always read the source judgment before relying on it.

Holding

The court dismissed the application for leave to defend, holding that the applicants failed to disclose a genuine defence or triable issue. The applicants' allegations of overpayment and invalidity of mortgage instruments were unsupported by evidence and constituted approbation and reprobation. A guarantor's obligation is discharged only when the principal debt is fully paid, not when foreclosure procedures fail. Judgment was entered for the respondent bank in the underlying summary suit.

Outcome

Application dismissed; judgment entered for the respondent bank for the outstanding loan sum of UGX 1,317,881,432.26

Facts

The 2nd applicant borrowed UGX 450,000,000 from the respondent bank at 22% per annum simple interest, repayable in 24 monthly instalments. The 1st applicant subsequently borrowed UGX 550,000,000 under similar terms. The 2nd and 3rd applicants guaranteed both loans. The loans were later restructured and consolidated, with the outstanding balance as of 19 July 2022 standing at UGX 1,128,002,985, repayable in 64 monthly instalments. The applicants defaulted, and the respondent filed a summary suit for UGX 1,317,881,432.26. The applicants sought unconditional leave to defend, alleging they had paid over UGX 700,000,000, that the mortgage instruments were invalid, and that the interest charged was excessive. The respondent maintained that the debt remained unpaid and that the applicants had provided no proof of payment.

Issues

  1. Whether there are sufficient grounds to grant the application for unconditional leave to appear and defend the summary suit.
  2. Whether the applicants have disclosed a triable issue of fact or law warranting leave to defend.

Orders

  • Application dismissed with costs to the Respondent.
  • Judgment entered in favour of the Respondent in HCCS No. 1102 of 2023 in accordance with Order 36, Rule 5 of the Civil Procedure Rules as amended.

Rules and key headnotes

Civil Procedure — Summary Suits — Leave to Defend — Test for Granting Leave
Before leave to appear and defend a summary suit is granted, the defendant must show by affidavit or otherwise that there is a bona fide triable issue of fact or law. The defence must be stated with sufficient particularity to appear genuine; general or vague statements denying liability will not suffice.
Civil Procedure — Summary Suits — Leave to Defend — Burden on Defendant
A defendant seeking leave to defend must disclose the nature of the claim or objections to the plaintiff's claims, founded on law or fact or both, which are bona fide and merit serious judicial consideration during trial. The defence must arise from the claims raised by the plaintiff in the specially endorsed plaint.
Civil Procedure — Summary Suits — Unsubstantiated Defences — Effect
Where a defendant alleges payment or disputes indebtedness but provides no evidence to support such assertions, the defendant has not raised a triable issue warranting leave to defend. Mere allegations without proof are insufficient.
Contract Law — Approbation and Reprobation — Inconsistent Positions
A party cannot both approve and reject the same transaction or agreement. Where applicants acknowledge the existence of a loan agreement and its variation but simultaneously challenge the validity of the underlying transaction without repaying the borrowed sum, such conduct amounts to approbation and reprobation and will not be countenanced by the court.
Banking & Finance — Guarantees — Discharge of Guarantor's Obligation
A guarantor's obligation under a third-party mortgage is discharged only when the principal debt is fully paid to the creditor. The guarantor is not discharged merely because foreclosure proceedings on the mortgaged property fail or are defective.

Legislation cited (7)

Cases cited (4)

  • Maluku International Trade Agency Ltd v Bank of Uganda [1985] HCB 65
  • Roko Construction Ltd v Ruhweza Transportation & Construction (U) Ltd (HCMA No. 831 of 2020)
  • Simbamanyo Estates Ltd v Equity Bank Uganda Ltd and 2 Others (HCMA No. 414 of 2022)
  • Guma Paulino v Bank of Africa and 2 Others (HCCS No. 13 of 2008)

Cases citing this judgment (2)

How later Ugandan judgments in the Wakilii corpus have cited this case. Treatment labels come from Sequitur — Uganda’s citator — each backed by a verbatim span from the citing judgment, and are not an assertion that this case is, or is not, good law.

Full judgment

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

Ratidu Trading Ltd and Others v Equity Bank (U) Ltd (Miscellaneous Application 2646 of 2023) [2025] UGCommC 56 (10 April 2025)
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.