Wakilii

Stanbic Bank Uganda v Muddu Awulira Enterprises Ltd (Civil Application No.67 of 2016)

Court of Appeal · [2018] UGCA 4 · 2018 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application by notice of motion for an order that the respondents give security for past costs in the High Court and further security for costs of a pending appeal
Decision
Application for security for costs dismissed with costs to the respondents

Observed later treatment

Cited — treatment unverified cited in 1 (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 1 time 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 applicant sought an order requiring the respondents to deposit UGX 2.4 billion as security for past High Court costs and further costs of a pending appeal, on the ground that the respondents were impecunious with no known income or assets. The single Justice held that an applicant for security for costs bears the burden of satisfying the court that the circumstances justify the order, and that poverty or lack of assets is not a proper ground. Ordering security for costs on grounds of poverty would be wrong in principle. The respondents' properties had in any event been mortgaged to and taken over by the applicant. The application was dismissed with costs.

Outcome

Application for security for costs dismissed with costs to the respondents

Facts

The respondents sued the applicant bank in the High Court alleging breach of loan agreements, seeking declarations, discharge of guarantees, a permanent injunction, special and general damages, interest and costs. The applicant counterclaimed for recovery of various sums plus interest. The High Court entered judgment partly in favour of the parties, leaving an outstanding balance due to the applicant with interest, and awarded the applicant three quarters of the costs of the suit. The respondents appealed, seeking to reverse the judgment and recover sums disallowed, making the value of the appeal subject matter exceedingly large. The applicant then applied for an order that the respondents give security for past High Court costs and further costs of the appeal totalling UGX 2.4 billion, contending the respondents were not engaged in any economic activity and had no known income or assets. The respondents had earlier mortgaged high-value properties to the applicant as security for the loan, which the applicant had taken over.

Issues

  1. Whether the applicant established sufficient grounds to justify an order requiring the respondents to give security for past and further costs.
  2. Whether the impecuniosity or lack of known assets of a respondent is a ground for ordering security for costs.

Orders

  • Application dismissed with costs to the respondents.

Rules and key headnotes

Civil Procedure — Security for Costs — Burden on Applicant
An applicant for security for costs bears the burden of satisfying the court that the circumstances of the case justify making the order sought.
Civil Procedure — Security for Costs — Impecuniosity Not a Ground
Poverty, impecuniosity or lack of assets is not a ground for ordering security for costs; to do so would be wrong in principle as it would turn the court into an arena reserved for the rich.
Civil Procedure — Security for Costs — Court's Discretion Under Rule 105(3)
The Court of Appeal has a wide and virtually unfettered discretion under rule 105(3) of its Rules to direct that security for past and further costs be given, but that discretion must be exercised judicially.
Civil Procedure — Security for Costs — Conduct of Applicant Holding Respondent's Assets
A party who has taken over a respondent's mortgaged properties as security cannot subsequently contend that the respondent has no assets from which costs may be recovered so as to obtain an order for security for costs.

Legislation cited (3)

  • Rules of the Court of Appeal r.105(3)
  • Rules of the Court of Appeal r.43
  • Rules of the Court of Appeal r.44

Cases cited (3)

  • Lalji Gangji v Nathoo Vasanjee (1960) EA 315
  • Mohamed v Madani (1953) 30 EACA 8
  • Noor Mohamed Abdulla Vs Patel (1962) 441 at 453

Cases citing this judgment (1)

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.

Stanbic Bank Uganda v Muddu Awulira Enterprises Ltd (Civil Application No.67 of 2016) [2018] UGCA 4 (12 January 2018)
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.