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Uganda Development Bank Ltd v Ringa Enterprises Co. Ltd & Anor (Miscellaneous Application No. 188 of 2017)

High Court · [2020] UGCOMMC 20 · 2020 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for review of order awarding costs in favour of 2nd Respondent in prior judgment, arising from Miscellaneous Cause No. 12 of 2015
Decision
Review application granted. Order awarding costs to 2nd Respondent set aside. Costs in main suit awarded to Applicant against both Respondents. Execution proceedings based on previous costs order set aside.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Court granted review of costs order upon discovery of previously misfiled personal guarantee agreement. Held that retrieval of the guarantee agreement after judgment, which could not be produced despite due diligence during trial, constitutes discovery of new and important evidence warranting review under Order 46 Rule 1(1) CPR. Court set aside costs award to 2nd Respondent and replaced it with order awarding costs to Applicant.

Outcome

Review application granted. Order awarding costs to 2nd Respondent set aside. Costs in main suit awarded to Applicant against both Respondents. Execution proceedings based on previous costs order set aside.

Facts

In January 2012, the 1st Respondent obtained a UGX 700,000,000 loan from the Applicant Bank with the 2nd Respondent as Managing Director. Upon default, the Applicant sued in OS Misc. Cause No. 12 of 2015. The court found in favour of the Applicant but dismissed the suit against the 2nd Respondent with costs, finding it redundant. The court was unaware of a personal guarantee agreement executed by the 2nd Respondent. The Applicant's then Bank Secretary had provided documents without the guarantee which had been misfiled. The guarantee was discovered on 28 February 2017, after judgment. The 2nd Respondent obtained a taxed bill of costs of UGX 25,000,000 and commenced execution proceedings, including issuing a warrant of arrest against the Applicant's Managing Director. The Applicant then filed this review application.

Issues

  1. Whether this is a fit and proper case for review under the law.
  2. Whether the Applicant is entitled to the reliefs prayed for.

Orders

  • Application allowed.
  • The order awarding costs to the 2nd Respondent in the judgment and decree dated 19th August 2016 is reviewed and set aside and is replaced with an order awarding costs in the main suit to the Plaintiff/Applicant against the 2nd Respondent.
  • Both the 1st and the 2nd Defendants/Respondents shall pay costs of the suit to the Plaintiff/Applicant.
  • The taxed bill of costs and the process of execution that had been commenced against the Applicant in respect to the impugned award of costs are set aside.
  • The Applicant is awarded the costs of this application against the Respondents.

Rules and key headnotes

Civil Procedure — Review of Judgment — Discovery of New Evidence — Requirements
For an order of review under Order 46 Rule 1(1) of the Civil Procedure Rules, the applicant must show discovery of new and important matter of evidence which, after the exercise of due diligence, could not be produced at the time when the decree was passed or order made.
Civil Procedure — Review of Judgment — Definition of 'New' Evidence — Evidence Previously Misfiled
Evidence constitutes 'new' matter for purposes of review where it was misfiled and could not be located during trial despite due diligence, even though the party knew of its existence. The word 'new' is relative and is determined by contrasting the date when the document was discovered with the date when case materials were compiled for trial.
Banking & Finance — Guarantees — Liability of Guarantor — Notice of Default
Under Section 71 of the Contracts Act 2010, a guarantor's liability takes effect upon default of the principal debtor without requirement for personal notice of default. A guarantor is immediately liable upon default of the principal promisor to the full extent of his obligation without being entitled to inquire about either notice of default or previous recourse against co-sureties.
Civil Procedure — Timelines for Filing Affidavit in Reply — Order 12 Rule 3 CPR
Order 12 Rule 3(2) of the Civil Procedure Rules, which prescribes 15 days for filing and reply to interlocutory applications, does not apply to applications filed after disposal of a suit. For such post-judgment applications, the same 15-day timeline that governs filing of a plaint and written statement of defence applies by analogy, but the circumstances of each case should be taken into consideration.
Banking & Finance — Guarantees — Continuing Guarantee — Discharge of Obligations
Where a guarantee agreement is expressed as a continuing guarantee, the guarantor's obligations can only be discharged by performance of the obligations undertaken, and the guarantor remains liable for the principal debtor's obligations throughout the duration of the guarantee.

Legislation cited (10)

Cases cited (5)

  • Stop and See (U) Ltd v Tropical Bank Ltd (Miscellaneous Application No. 333 of 2020)
  • Tanitalia Ltd v Mawa Handels Anstal (1957) EA 215
  • Moschi v Lep Air Services Ltd [1973] AC 33
  • Barclays Bank of Uganda Ltd v Sing Hong Guo Dong (Civil Suit No. 35 of 2009)
  • Bank of Uganda v Banco Arabe Espanol CA (Civil Appeal No. 23 of 2000)

Full judgment

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

Uganda Development Bank Ltd v Ringa Enterprises Co. Ltd & Anor (Miscellaneous Application No. 188 of 2017) [2020] UGCommC 20 (28 May 2020)
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.