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Uganda Registration Services Bureau v Stellar Properties Limited [2022] UGHC 269

High Court · 2022 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for leave to appear and defend summary suit arising from HCCS No. 0688 of 2022
Decision
Application dismissed; judgment entered for Respondent for total rental arrears of UGX 6,302,873,994

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Holding

Leave to appear and defend refused. The court held that the applicant failed to establish triable issues. The tenancy agreements were duly executed by the Accounting Officer with Attorney General clearance; litigation was the agreed dispute resolution mechanism, not arbitration; and the applicant failed to produce evidence disputing the quantum of rental arrears. Judgment entered for UGX 5,689,186,152 in rental arrears plus UGX 613,687,842 for subsequent period.

Outcome

Application dismissed; judgment entered for Respondent for total rental arrears of UGX 6,302,873,994

Facts

The Respondent landlord filed a summary suit claiming UGX 6,136,000,000 in rental arrears from the Applicant tenant under three successive tenancy agreements spanning approximately 15 years. The Applicant occupied commercial premises and paid rent partially but accumulated substantial arrears over four years. The Applicant terminated the tenancy on 29 August 2022, admitting outstanding obligations. All three tenancy agreements were signed by the Applicant's Accounting Officer (the deponent herself signing the third agreement) and cleared by the Attorney General. The Solicitor General had advised that the dispute resolution clause be changed from arbitration to litigation, which amendment was incorporated into the final agreement. The Applicant filed this application seeking leave to defend, alleging procurement irregularities, claiming arbitration was the proper dispute mechanism, and challenging the quantum without providing contrary figures.

Issues

  1. Whether the Applicant should be granted unconditional leave to appear and defend Civil Suit No. 688 of 2022.
  2. Whether the tenancy agreements forming the basis of the claim were illegal due to procurement irregularities.
  3. Whether the dispute should be referred to arbitration under the tenancy agreements.
  4. Whether there is a triable issue regarding the quantum of rental arrears claimed.

Orders

  • Application for leave to appear and defend dismissed with costs to the Respondent.
  • Judgment entered in favour of the Respondent as prayed in Civil Suit No. 688 of 2022.
  • The Applicant shall pay UGX 5,689,186,152 being rental arrears owed to the Respondent for the period up to 30th September 2022.
  • The Applicant shall pay UGX 613,687,842 to the Respondent for the period 1st October to 31st December 2022.
  • Costs of the suit awarded to the Respondent.

Rules and key headnotes

Summary Suits — Leave to Appear and Defend — Test for Grant
In an application for leave to appear and defend a summary suit under Order 36 of the Civil Procedure Rules, the applicant must show that he or she has a good defence on the merits, or that a difficult point of law is involved, or that there is a dispute which ought to be tried, or a real dispute on the amount claimed. General denials without supporting evidence are insufficient.
Illegality — Tenancy Agreements — Procurement by Public Bodies
Where a tenancy agreement has been signed by a public entity's Accounting Officer in exercise of statutory functions under section 26 of the Public Procurement and Disposal of Public Assets Act, and the agreement has received Attorney General clearance, a subsequent claim of illegality based on procurement irregularities constitutes an afterthought where the tenant has occupied the premises for an extended period, paid rent partially, and admitted outstanding obligations without prior challenge to validity.
Arbitration Clauses — Permissive Language versus Mandatory Language
Where a contract uses the permissive word 'may' in a general dispute resolution clause referring to arbitration or other formal mechanisms, but uses the mandatory word 'shall' in the Special Conditions of Contract specifying litigation before a court of competent jurisdiction, the parties' intention is to make litigation the mandatory dispute resolution mechanism and arbitration is not an available alternative.
Quantum — Burden of Proof — Rental Arrears
In a claim for rental arrears under commercial tenancy agreements where the duration of occupation and rent payments are documented, a defendant who denies the quantum claimed without producing any evidence of the sum they contend is correct has not established a triable issue on quantum. A general denial unsupported by contrary calculations or evidence is insufficient to resist summary judgment.

Legislation cited (5)

Cases cited (2)

  • Mako Warehouse Co. Ltd v Total (U) Ltd (Miscellaneous Application No. 1031 of 2021)
  • MMK Engineering v Mantrust Uganda Limited (Miscellaneous Application No. 128 of 2021)

Full judgment

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Uganda Registration Services Bureau v Stellar Properties Limited 2022 UGHC 269 (6 December 2022)
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.