Wakilii

Umeme Limited v Kefa & Another (Miscellaneous Application 130 of 2023)

High Court · [2023] UGHC 472 · 2023 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Ex-parte application for leave to issue third-party notice arising from civil suit for damages
Decision
Leave granted to issue third-party notice; matter to proceed with third party joined.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that an applicant defendant who faces a damages claim and holds a general liability insurance policy covering property damage and legal costs has sufficient grounds to join the insurer as a third party, provided the subject matter is the same, there is a contractual right to indemnity, the plaintiff suffers no prejudice, and joinder serves the interest of justice by preventing multiplicity of actions. Leave granted to issue third-party notice.

Outcome

Leave granted to issue third-party notice; matter to proceed with third party joined.

Facts

Umeme Limited is the defendant in Civil Suit No. 47 of 2020 brought by Rev. Kefa Sempangi and Oliver Sempangi. The plaintiffs claim special damages of UGX 223,125,000, loss of profit of UGX 12,020,000, and costs arising from the alleged negligent cutting of generator wires by Umeme's employees on 7 August 2020, which allegedly caused the loss of 80,000 chicks in an incubator and hatchery. Umeme holds a General Liability Insurance Policy dated 15 January 2020 with Sanlam General Insurance (U) Ltd. Under the policy, Sanlam undertook to indemnify Umeme against losses, liabilities, damages, legal costs, and expenses arising from property damage claims. Umeme applied ex-parte for leave to issue a third-party notice to join Sanlam as a party to the suit.

Issues

  1. Whether the Applicant has sufficient grounds to join the Respondent as a third party.
  2. Whether the subject matter between the Applicant and the Respondent is the same as the subject matter between the Plaintiff and the Defendant and the original cause of action.
  3. Whether the Applicant claims indemnity or contribution from the Respondent.
  4. Whether the Plaintiff shall not suffer any prejudice if the Application is granted.
  5. Whether it is in the interest of justice that the suit is heard on its merits.

Orders

  • Leave granted to the Applicant to issue a Third Party Notice to Sanlam General Insurance in Civil Suit No. 47 of 2020.
  • The costs of this Application be in the cause.

Rules and key headnotes

Civil Procedure — Third-Party Proceedings — Grounds for Leave to Issue Third-Party Notice
A defendant may obtain leave to issue a third-party notice where: (i) the applicant has sufficient grounds to join the third party; (ii) the subject matter between the defendant and the third party is the same as the subject matter between the plaintiff and the defendant; (iii) the defendant claims indemnity or contribution from the third party; (iv) the plaintiff will not suffer prejudice; and (v) it is in the interest of justice.
Civil Procedure — Third-Party Proceedings — Purpose and Scope
The general scope of third-party procedure is to deal with cases in which all disputes arising out of the transaction as between the plaintiff and the defendant and the defendant and the third party can be tried and settled in the same action, thereby preventing multiplicity of actions.
Insurance — Indemnity — General Liability Insurance — Right to Join Insurer as Third Party
Where a defendant holds a general liability insurance policy under which the insurer covenanted to indemnify the defendant against all losses, liabilities, damages, and legal costs arising from property damage claims, the defendant has a contractual right to indemnity and sufficient grounds to join the insurer as a third party in proceedings where such claims are made.
Insurance — Indemnity — Meaning and Source
A right to indemnity generally arises from contract and exists where the relationship between the parties is such that either in law or in equity there is an obligation upon one party to indemnify the other.

Legislation cited (2)

Cases cited (6)

  • Sango Bay Estates v Dresdner Bank (1971) EA 307
  • Semanda Isima Moses v Airtel Uganda Ltd and Another (Miscellaneous Application No. 996 of 2020)
  • ATC (U) Limited v Bitama and Others (Miscellaneous Application No. 111 of 2022)
  • Panyahululu Co. Ltd v New Ocean Transporters Co. Ltd and Others (HCCS No. 523 of 2006)
  • D.S.S. Motors Ltd v Afri Tours and Travel Ltd (HCCS No. 12 of 2003)
  • Easter Shipping Co. v Quah Beng Kee [1924] AC 177

Full judgment

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

Umeme Limited v Kefa & Another (Miscellaneous Application 130 of 2023) [2023] UGHC 472 (18 December 2023)
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.