Wakilii

Steam Investments Limited v Isolux Ingeniera SA & 2 Others (Miscellaneous Application 819 of 2022)

High Court · [2024] UGCOMMC 130 · 2024 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for garnishee order absolute arising from execution proceedings following judgment in Civil Suit No. 91 of 2021
Decision
Application for garnishee order absolute dismissed; applicant directed to bring fresh suit by way of plaint if seeking to establish 1st garnishee's indebtedness

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

A garnishee order absolute cannot be issued where the garnishee disputes indebtedness. When a garnishee denies being indebted to the judgment debtor, Order 23 Rule 4 of the Civil Procedure Rules requires the applicant to bring a fresh suit by way of plaint to determine the question of indebtedness through trial. The doctrine of res judicata does not apply where the parties in the current application are different from those in the earlier suit, even if they arise from related contractual arrangements.

Outcome

Application for garnishee order absolute dismissed; applicant directed to bring fresh suit by way of plaint if seeking to establish 1st garnishee's indebtedness

Facts

The applicant obtained a decree against Isolux Ingeniera SA for USD 3,680,537 and UGX 90,777,740 in Civil Suit No. 91 of 2021. Seeking to execute the judgment, the applicant filed this garnishee application against UETCL and the African Development Bank, claiming that UETCL held funds belonging to the judgment debtor from a construction contract for interconnection of electric grids. UETCL had contracted Isolux to carry out works co-funded by ADB and JICA. In 2017, when Isolux applied for bankruptcy in Spain, UETCL cashed the performance guarantee to recover advance payments made. UETCL denied being indebted to Isolux, asserting it had cashed the guarantees to recover monies advanced and that the judgment debtor remained indebted to UETCL. The applicant withdrew the case against the 2nd garnishee by consent. A garnishee order nisi was initially granted but later vacated. The court directed the parties to engage the Auditor General to verify whether any funds were owed. The Auditor General's report of August 2023 found limited available balances (Euros 80,654, USD 23,334 and UGX 282,666,156) after UETCL cashed the performance guarantee.

Issues

  1. Whether M/s Kampala Associated Advocates were conflicted and should be barred from representing the 1st garnishee.
  2. Whether the question of indebtedness is res judicata by virtue of the findings in Miscellaneous Appeal No. 007 of 2018.
  3. Whether a garnishee order absolute should be issued against the 1st garnishee.

Orders

  • Application dismissed.
  • Each party to bear their own costs.
  • No garnishee order absolute issued against the 1st Garnishee.

Rules and key headnotes

Conflict of Interest — Standing to Raise Objection — Fiduciary Relationship Requirement
Conflict of interest under Regulation 4 of the Advocates (Professional Conduct) Regulations can only be raised by a former client of the advocate in question, as it is founded on the existence of a fiduciary relationship between lawyer and client. A third party who has never been a client of the law firm lacks standing to raise a conflict of interest objection.
Res Judicata — Requirements — Identity of Parties
The doctrine of res judicata applies only where the parties in the current suit are the same as those in the former suit, or parties under whom they claim litigating under the same title. The fact that two parties had similar sub-contractor agreements with the same principal contractor does not make them privies for purposes of res judicata.
Garnishee Proceedings — Disputed Debt — Requirement for Trial
Under Order 23 Rule 4 of the Civil Procedure Rules, where a garnishee by affidavit disputes the debt owed to the judgment debtor, the court shall not make the garnishee order absolute but must order that any issue or question necessary for determining the garnishee's indebtedness be tried and determined in the manner in which an issue in a suit is tried. The applicant must bring a fresh suit by way of plaint to establish the indebtedness.

Legislation cited (5)

Cases cited (15)

  • Uganda v Ojangole Patricia (Criminal Case No. 1 of 2014)
  • Sudhir Ruparelia v MMAKS Advocates & 3 Others (Miscellaneous Application No. 1063 of 2017)
  • Quality Uganda Ltd t/a Quality Supermarket v Uganda Performing Rights Society & Others (Civil Suit No. 44 of 2009)
  • Ayebazibwe Raymond v Barclays Bank (U) Ltd & Others (Civil Suit No. 165 of 2012)
  • Hermon Tesfalidet Ghebrat v Marlin Advocates & Another (Miscellaneous Application No. 196 of 2020)
  • Nyeenya Mayambala & 2 Others v Bisaso Nathan (Civil Suit No. 263 of 2005)
  • Maniraguha Gashumba v Sam Nkundiye (Civil Appeal No. 23 of 2005)
  • Bithum Charles v Adonge Sally (Miscellaneous Application No. 20 of 2015)
  • Posiyano Semakula v Susane Magala & Others (Civil Appeal No. 2 of 1977)
  • Akuku Ebifania (Administrator of the Estate of the Late Vuura Kajoale) v Victoria Munia & Another (Civil Appeal No. 27 of 2016)
  • Fr. Narsensio Begumisa & Others v Eric Tibebaga (Civil Appeal No. 17 of 2002)
  • James Katabazi & 21 Others v The Secretary General of the East African Community & Another (Reference No. 1 of 2007)
  • Boutique Shazim Ltd v Norattam Bhatia & Another (Civil Appeal No. 36 of 2007)
  • DFCU Bank Ltd v Todaf Engineering and Civil Works Ltd & Another (Civil Appeal No. 1185 of 2022)
  • Uganda Electricity Transmission Company Ltd v Johnston Group Ltd (Miscellaneous Appeal No. 7 of 2018)

Full judgment

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

Steam Investments Limited v Isolux Ingeniera SA & 2 Others (Miscellaneous Application 819 of 2022) [2024] UGCommC 130 (13 May 2024)
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.