Wakilii

Shumuk springs development Ltd & 3 Ors v Katatumba & 6 Ors (HCT-00-CC-CS 375 of 2009)

High Court · [2012] UGCOMMC 172 · 2012 Suit Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance suit for permanent injunction dismissed following preliminary objections on grounds of lis pendens, privity of contract, and abuse of process
Decision
Suit dismissed in its entirety — plaint rejected as against 2nd–6th defendants; dismissed as frivolous and vexatious against 1st defendant; dismissed with no costs order against 7th defendant

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that the suit offends the mandatory lis pendens rule because the subject matter is directly and substantially in issue in an earlier pending suit between the same parties; the plaint discloses no cause of action against the 2nd to 6th defendants on grounds of privity of contract; and the suit against the 1st defendant is frivolous and vexatious as it circumvents an earlier suit and consent order. Suit dismissed with costs.

Outcome

Suit dismissed in its entirety — plaint rejected as against 2nd–6th defendants; dismissed as frivolous and vexatious against 1st defendant; dismissed with no costs order against 7th defendant

Facts

The 1st plaintiff entered into a sale agreement dated 16 August 2008 with the 1st defendant to purchase property on plot 2 Colville Street for USD 5 million. The 1st plaintiff alleged fundamental breach by the 1st defendant and rescinded the agreement. The 1st defendant then sued the plaintiffs in HCCS 126/2009. The plaintiffs filed a counterclaim. On 18 May 2009 a consent order was made in MA 193/2009 requiring the plaintiffs to issue a bank guarantee for USD 1.7 million payable to the 1st defendant's creditors upon delivery of unencumbered condominium titles. The plaintiffs then filed the current suit seeking a permanent injunction to prevent the defendants from dealing with 27 condominium units, alleging non-compliance with the consent order and that the 2nd defendant registered himself as proprietor and executed a sale agreement with the 3rd defendant.

Issues

  1. Whether the suit offends the lis pendens rule under section 6 of the Civil Procedure Act
  2. Whether there is misjoinder of plaintiffs
  3. Whether the plaint discloses a cause of action against the defendants
  4. Whether the suit is frivolous and vexatious

Orders

  • Plaint discloses no cause of action against the 2nd, 3rd, 4th, 5th and 6th defendants and is rejected under Order 7 rule 11 of the Civil Procedure Rules with costs.
  • Suit against the 1st defendant is frivolous and vexatious and an abuse of the process of court; dismissed with costs under Order 6 rule 30 of the Civil Procedure Rules.
  • Suit against the 7th defendant (Registrar of Titles) dismissed with no order as to costs.

Rules and key headnotes

Lis Pendens — Stay of Suit — Mandatory Bar Under Section 6 Civil Procedure Act
Section 6 of the Civil Procedure Act mandatorily bars a court from proceeding with the trial of a suit where the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties or parties claiming under them. The bar applies where the subsequent suit involves creditors who claim from the same transaction and from a defendant who is a principal party to the earlier suit.
Scope of 'Trial' — Determination of Preliminary Points of Law and Lis Pendens
The word 'trial' in section 6 of the Civil Procedure Act means the final determination of a matter in controversy. A court may determine whether a plaint discloses a cause of action or whether there is misjoinder without offending the mandatory stay provisions, because such determinations do not try the substantive matter in controversy but decide whether the suit should proceed at all.
Privity of Contract — Non-Parties Cannot Enforce or Be Bound by Contract
It is an elementary principle of law that only parties to an agreement can sue upon it. Where a contract is executed for the benefit of a third party, it is only the parties to the contract who can enforce it. The third party is not allowed to assert rights under the contract in a court of law. By the same token the contract is not binding or enforceable as between the third party and any party privy to the contract.
Cause of Action — Pleading Rescission of Contract Defeats Claim Based on That Contract
Where a plaintiff pleads that it rescinded the only agreement on which the claim is founded, the plaint discloses no cause of action for specific performance, injunction, or other remedies that presuppose the continuance of the contract. A rescinded contract cannot ground a permanent injunction to restrain dealings with property acquired under that contract.
Frivolous and Vexatious Suits — Circumventing Earlier Suit and Consent Order
It is frivolous and vexatious to file a suit complaining of breach of a consent order made in an earlier pending suit, without seeking to enforce or set aside that order in the earlier proceedings. Such a suit amounts to an abuse of the process of court and is liable to dismissal under Order 6 rule 30 of the Civil Procedure Rules.
Misjoinder — Procedural Remedy — No Basis for Preliminary Objection
Order 1 rule 9 of the Civil Procedure Rules provides that no suit shall be defeated by reason of misjoinder or nonjoinder of parties. The proper procedure for dealing with misjoinder is an application under Order 1 rules 10 and 13 to strike out a party improperly joined. Misjoinder does not form the basis of a preliminary objection to dismiss the suit.
Consent Orders — Enforceable Only as Between Parties to Consent
A consent order, while subject to the general principles of contract law, is enforceable as an order of court only between the parties to the consent. It cannot form the basis of a suit against third parties who are not parties to the order, even if those third parties are creditors contemplated by the terms of the order.

Legislation cited (11)

  • Civil Procedure Act s.6
  • Civil Procedure Act s.7
  • Civil Procedure Rules O.1 r.1
  • Civil Procedure Rules O.1 r.9
  • Civil Procedure Rules O.1 r.10
  • Civil Procedure Rules O.1 r.13
  • Civil Procedure Rules O.6 r.28
  • Civil Procedure Rules O.6 r.29
  • Civil Procedure Rules O.6 r.30
  • Civil Procedure Rules O.7 r.11
  • Civil Procedure Rules O.15 r.1

Cases cited (8)

  • Macaura v Northern Assurance Co [1925] AC 619
  • Cope v United Dairies (London) Ltd [1963] 2 All ER 194
  • Drummond Jackson v British Medical Association [1970] 1 All ER 1094
  • Kampala Rugby Union Football Club v Capital Ventures International Limited (HCCS No. 139 of 2011)
  • Ismail Serugo v Kampala City Council and Attorney General (Constitutional Appeal No. 2 of 1998)
  • Attorney General v Oluoch [1972] EA 392
  • Scrutons v Midland Silicones Ltd [1962] 1 All ER 1
  • Shiv Construction Ltd v Endesha Enterprises Ltd [1999] EA 329

Full judgment

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

Shumuk springs development Ltd & 3 Ors v Katatumba & 6 Ors (HCT-00-CC-CS 375 of 2009) [2012] UGCommC 172 (20 April 2012)
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.