Wakilii

Robert Mwesigwa and Anor v Bank of Uganda (HCT-00-CC-CS 588 of 2003)

High Court · [2005] UGCOMMC 33 · 2005 Plaint Struck Out AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Civil suit for breach of contract and damages; defendant raised preliminary objections on cause of action and failure to plead bad faith
Decision
Plaint struck out on preliminary objection; no trial on merits

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court held that former employees of International Credit Bank Ltd had no direct cause of action against Bank of Uganda as statutory manager, since BOU was not party to the employment contracts and the Financial Institutions Statute confers no employment rights upon a statutory manager. The plaint failed to plead bad faith with sufficient particularity to overcome the statutory protection under s.49 of the Financial Institutions Statute. The plaint was struck out for disclosing no cause of action.

Outcome

Plaint struck out on preliminary objection; no trial on merits

Facts

The plaintiffs were 136 former employees of International Credit Bank Ltd (ICB). On 18 September 1998, Bank of Uganda seized and took control of ICB under the Financial Institutions Statute 1993. The plaintiffs claimed that Bank of Uganda negligently ran ICB and failed to pay them salary arrears and terminal benefits, causing hardship. A parallel suit (HCCS No. 1/2000) had been filed against ICB and BOU jointly; Lugayizi J dismissed the suit against BOU as unmaintainable. The plaintiffs then filed the instant suit against BOU alone, alleging breach of contract, duty, trust, and negligence, and seeking general and exemplary damages. BOU raised preliminary objections that the plaint disclosed no cause of action and that bad faith had not been pleaded with sufficient particularity.

Issues

  1. Whether the plaint discloses a cause of action against the defendant Bank of Uganda in respect of employment contracts to which it was not privy.
  2. Whether bad faith has been pleaded with sufficient particularity as required under s.49 of the Financial Institutions Statute to sustain a claim against Bank of Uganda.
  3. Whether the doctrine of promissory estoppel can establish liability against the defendant.

Orders

  • Plaint struck out under Order 7 rule 11(a) of the Civil Procedure Rules for failure to disclose a cause of action.
  • Each party to bear its own costs.

Rules and key headnotes

Civil Procedure — Preliminary Objections — Cause of Action — Requirements
A plaint discloses a cause of action if it shows that the plaintiff enjoyed a right, that the right was violated, and that the defendant is liable for that violation.
Contract Law — Privity of Contract — Statutory Manager — Employment Contracts
Where a statutory authority takes possession and control of a financial institution under the Financial Institutions Statute, it does not become party to employment contracts between the institution and its employees, and the institution remains liable for employment rights until finally liquidated and deregistered.
Banking & Finance — Statutory Liquidation — Powers of Central Bank — Privity of Contract
Section 32 of the Financial Institutions Statute vests the Central Bank with exclusive powers of management and control of a possessed financial institution, but does not transfer employment liabilities from the institution to the Central Bank; the institution remains capable of suing and being sued through the Central Bank.
Statutory Interpretation — Financial Institutions Statute — Section 49 — Protection from Suit
Section 49 of the Financial Institutions Statute protects Bank of Uganda and its officers from suit for acts done in good faith pursuant to the statute; a party suing BOU must plead and prove bad faith to overcome this statutory protection.
Civil Procedure — Pleadings — Bad Faith — Particulars Required
Where a party's case depends on alleging bad faith against a defendant protected by statute, bad faith must be specifically pleaded as a cause of action and particulars of the acts constituting bad faith must be given with dates; it is insufficient merely to particularise bad faith without pleading it.
Contract Law — Promissory Estoppel — Pleading Requirements
To rely on the doctrine of promissory estoppel, a party must plead and prove facts giving rise to waiver or estoppel; estoppel cannot be left to inference and cannot be relied upon if cited only as an instance of bad faith rather than as a cause of action.

Legislation cited (5)

  • Financial Institutions Statute No. 4/1993 s.31
  • Financial Institutions Statute No. 4/1993 s.32
  • Financial Institutions Statute No. 4/1993 s.49
  • Civil Procedure Rules O.6 r.2
  • Civil Procedure Rules O.7 r.11(a)

Cases cited (5)

  • Auto Garage & Others v Motokov (No. 3) [1971] EA 514
  • Kayanja v New India Assurance Company Ltd [1968] EA 295
  • Greenland Bank Ltd v Westmont Land (Asia) (HCCS No. 309 of 1999)
  • Balwant Singh v Kipkoech arap Serem [1963] EA 651
  • HCCS No. 1/2000, Lugayizi, J., Ruling of 22/9/2003

Full judgment

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

Robert Mwesigwa and Anor v Bank of Uganda (HCT-00-CC-CS 588 of 2003) [2005] UGCommC 33 (21 June 2005)
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.