Uganda Development Bank Ltd v Aba Trade International Ltd & 3 Ors (Civil Suit No. 357 of 2010)

Observed later treatment

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.

Holding

Held that registration by Uganda Revenue Authority of a motor vehicle in the importer's name without consent of the consignee named in the bill of lading is unlawful under Traffic and Road Safety Act s.12(1), which requires an application for registration by the owner—the consignee in a negotiable bill of lading. The sale by the first defendant to the fourth defendant was lawful but voidable, as the first defendant had authority to sell under the trade finance arrangement but failed to disclose the plaintiff bank's lien and requirement for written release instructions. Plaintiff entitled to retain lien over the vehicle until outstanding sums paid.

Outcome

Plaintiff's claims substantially allowed. Registration declared unlawful and cancellation ordered. Plaintiff's lien upheld; first defendant to pay outstanding sums within 30 days or plaintiff may exercise lien.

Facts

Plaintiff bank financed first defendant's importation of trucks under trade finance facility. Goods consigned to the order of plaintiff in bill of lading; first defendant named as notify party. Collateral manager appointed to warehouse goods pending payment. Plaintiff retained lien; goods could only be released on its written instructions after receipt of payment. Before payment, third defendant (managing director of first defendant) sold one truck to fourth defendant for UGX 80,000,000, banking proceeds in his personal account. Second defendant (Uganda Revenue Authority) registered the vehicle in first defendant's name based on import documents, without checking the bill of lading or obtaining plaintiff's consent. Plaintiff brought suit claiming legal ownership, unlawful registration, and illegal sale.

Issues

1. Whether the registration of the vehicle by the second defendant in the names of the first defendant was unlawful.
2. Whether the alleged/purported sale of the suit vehicle by the third defendant to the fourth defendant was lawful.
3. What remedies are available to the parties?

Orders

• Declaration that the plaintiff is the legal owner of Mercedes-Benz tractor head chassis number WDB 944-2332 K9001 80 registration number UAN 520Z with specific right to hold on to the goods for enforcement of its right to payment only. The first defendant is the beneficial or equitable owner and its right to registration, possession and transfer of legal title is exercisable upon payment of any outstanding monies to the plaintiff.
• Declaration that the second defendant's registration of the first defendant as owner of Mercedes-Benz tractor head chassis number WDB 944-2332 K9001 80 registration number UAN 520 Z contrary to the naming of the plaintiff as consignee in the bill of lading is unlawful.
• Order that the second defendant shall cancel the registration of the first defendant as owner of Mercedes-Benz tractor head chassis number WDB 944-2332K900180.
• Declaration that the first defendant was entitled to sell the vehicle to the fourth defendant with full disclosure as to the terms upon which the vehicles were held by ACE and the transaction of sale is voidable at the instance of the fourth defendant and also enforceable against the first defendant.
• Plaintiff awarded general damages of US$2,000 against the second defendant.
• First defendant given 30 days from service to pay outstanding amounts to the plaintiff; upon failure plaintiff entitled to exercise its lien.
• Costs awarded to the plaintiff against the 1st and 2nd defendants only. The 3rd and 4th defendants to bear their own costs.

Rules and key headnotes

Legislation cited (12)

• Uganda Development Bank Act cap 56
• Traffic and Road Safety Act cap 361 s.10
• Traffic and Road Safety Act cap 361 s.12(1)
• Traffic and Road Safety Act cap 361 s.12(2)
• Traffic and Road Safety Act cap 361 s.12(4)
• Traffic and Road Safety Act cap 361 s.13(1)
• Traffic and Road Safety Act cap 361 s.13(5)
• Sale of Goods Act cap 82 s.1(e)
• Sale of Goods Act cap 82 s.22
• Sale of Goods Act cap 82 s.23
• Financial Institutions Act 2004 s.37
• East African Community Customs Management Act 2004 s.2(1)

Cases cited (8)

• Rapid Shipping and Freight Uganda Ltd and Another v Copy Lines Ltd (Misc. Application No. 216 of 2012)
• P & O Nedlloyd Uganda Ltd v Tesco International Ltd (Court of Appeal Civil Appeal No. 86 of 2004)
• Rahima Nagitta and Others v Richard Bukenya and Three Others (High Court Civil Suit No. 389 of 2010)
• Lennard's Carrying Co v Asiatic Co Ltd [1915] AC 705
• Biddell Bros Ltd v E Clemens Horst & Co Ltd [1911] 1 KB 934
• Heskell v Continental Express Ltd and Another [1950] 1 All ER 1033
• S.S. Ardennes (Owner of Cargo) v S.S. Ardennes (Owners) [1950] 2 All ER 517
• Hebert Niwamanya v Uganda Revenue Authority (High Court Civil Suit No. 003 of 2008)

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.

• Uganda Developement Bank Ltd v ABA Trade International Ltd & 3 Ors (Miscellaneous Application No. 567 of 2010)

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