Wakilii

Tropical Africa Bank Ltd v CC Juuko Salongo (HCT-00-CC-CS 29 of 2005)

High Court · [2007] UGCOMMC 76 · 2007 Plaint Rejected AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of outstanding loan balance secured by mortgage
Decision
Suit dismissed with costs to defendant

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that a suit to recover arrears of interest secured by mortgage brought more than six years after the interest became due is barred by Section 18(5) of the Limitation Act. Where a plaint mingles time-barred claims with claims that may not be barred and does not disclose which portions are statute-barred, the entire plaint must be rejected under Order 7 rule 11(d) of the Civil Procedure Rules.

Outcome

Suit dismissed with costs to defendant

Facts

On 10 June 1997, the plaintiff bank advanced an overdraft of Shs.55,000,000.00 at 27% per annum interest to Waswa & Co Ltd for six months. The defendant guaranteed the overdraft and mortgaged real property as security. Waswa & Co Ltd defaulted. On 30 September 1999, the plaintiff sold the mortgaged property for Shs.100,000,000.00, leaving a balance of Shs.30,597,870.00. By 31 January 2003, the outstanding balance had grown to Shs.81,805,916.00. The plaintiff originally filed suit on 12 January 2003 seeking Shs.115,148,409.00 with interest at 27% per annum from 1 April 1999. On 30 May 2007, the plaintiff filed an amended plaint seeking Shs.81,805,916.00 with continuing interest. The court raised suo motu the issue of whether the suit was time-barred under the Limitation Act.

Issues

  1. Whether the suit was time barred under Section 18(5) of the Limitation Act for recovery of interest on a mortgage debt.
  2. Whether the plaint could proceed when it mingled time-barred claims with potentially valid claims without distinguishing between them.

Orders

  • Plaint rejected as barred by Section 18(5) of the Limitation Act.
  • Costs awarded to the defendant.

Rules and key headnotes

Banking & Finance — Mortgages — Recovery of Interest — Limitation Period
An action to recover arrears of interest payable in respect of any sum of money secured by a mortgage must be brought within six years from the date on which the interest became due, as prescribed by Section 18(5) of the Limitation Act.
Civil Procedure — Pleadings — Rejection of Plaint — Mingling Time-Barred and Valid Claims
Where a plaint mingles together sums of money barred by statute with portions that may not be statute-barred without disclosing which portions are time-barred and which are not, it is not possible to carry the suit forward in that state and the plaint must be rejected.
Civil Procedure — Pleadings — Particulars Required for Limitation Defence
A plaint that does not show any ground which would exempt the claim from being barred by statute, as required under Order 7 rule 6 of the Civil Procedure Rules, is liable to rejection under Order 7 rule 11(d) where portions of the claim are statute-barred.

Legislation cited (3)

Full judgment

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

Tropical Africa Bank Ltd v CC Juuko Salongo (HCT-00-CC-CS 29 of 2005) [2007] UGCommC 76 (19 September 2007)
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.