Wakilii

Visare Uganda Limited v M S Gadala and Nshekanabo Advocates (Civil Appeal 1322 of 2021)

High Court · [2021] UGCOMMC 192 · 2021 Appeal Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from taxation of advocate-client bill of costs by the Registrar
Decision
Bill of costs remitted to Registrar for fresh taxation

Observed later treatment

Cited — treatment unverified cited in 2 (treatment unverified) Sequitur — Uganda’s citator · Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

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.

No adverse treatment recorded Cited 2 times with no adverse treatment recorded; not yet tested on the merits. Derived from citing cases in the Wakilii corpus — a deterministic signal, not legal advice.

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions—always read the source judgment before relying on it.

Holding

The High Court held that the Registrar erred in principle by determining the value of the subject matter as the combined market value of mortgaged property plus the outstanding loan amount. The correct value of the subject matter in a suit to stop a mortgagee's sale is the equity of redemption — the cost of removing the encumbrance, not the market value of the property. The Registrar misconstrued the value and failed to balance all relevant considerations in taxation of costs. The award was manifestly excessive and set aside.

Outcome

Bill of costs remitted to Registrar for fresh taxation

Facts

In February 2017, Visare Uganda Limited secured a USD 2.5 million term loan from KCB Bank Limited to construct residential apartments, secured by a mortgage over Plot 65A Lugogo Bypass. Following default, the bank recalled the loan in May 2019, issued notices of default and sale, and advertised the property (valued at USD 13,260,000) for sale. The appellant retained Gadala & Nshekanabo Advocates to stop the foreclosure. The respondent filed suit and secured an interlocutory injunction conditioned on depositing USD 550,000. The appellant subsequently negotiated a consent judgment with the bank without involving the respondent. The respondent then served an advocate-client bill of costs. At taxation, the Registrar awarded UGX 1,128,255,200 as instruction fees, calculating the value of the subject matter as the combined market value of the property (USD 13,260,000) plus the outstanding loan (USD 2,500,000), totaling USD 15,760,000. The appellant appealed, contending the instruction fee was excessive.

Issues

  1. Whether the Registrar erred in principle when determining the value of the subject matter for purposes of calculating instruction fees in an advocate-client bill of costs.
  2. Whether the instruction fee award of UGX 1,139,940,000 was excessive, unconscionable, oppressive and unlawful.

Orders

  • Appeal allowed.
  • Award of instruction fees set aside.
  • Bill of costs remitted to the Registrar for taxation de novo.
  • Each party to bear their own costs of the appeal.

Rules and key headnotes

Taxation of Costs — Advocate-Client Bills — Value of Subject Matter in Mortgage Redemption Suits
In a suit to stop a mortgagee's exercise of the power of sale, the value of the subject matter for purposes of calculating instruction fees is the equity of redemption — the cost of removing the encumbrance by paying off the outstanding debt — and not the market value of the mortgaged property.
Taxation of Costs — Meaning of 'Subject Matter'
The expression 'subject matter' in taxation of costs refers to the primary right asserted by the plaintiff, the legal issue presented for consideration, or the cause of action — not necessarily the physical property or its market value. It is the right which one party claims as against the other.
Appeals from Taxation — Grounds for Interference
An appellate court will interfere with a Registrar's taxation award only where there has been an error in principle, or where the award is so manifestly excessive or low as to justify treating it as indicative of the exercise of a wrong principle, or where there are exceptional circumstances justifying intervention.
Taxation of Costs — Factors to Consider
In taxing advocate-client costs, the Taxing Officer must balance multiple considerations including the amount of work done, the value of the subject matter, the importance to the client of the matters in dispute, the complexity of the matter, and the extent of industry deployed by counsel. Undue regard to one factor at the expense of others constitutes an error in principle.
Mortgages — Equity of Redemption — Nature and Value
The equity of redemption is the mortgagor's right to recover unencumbered enjoyment of mortgaged property by repaying the mortgage debt in full and performing any other legitimate obligations. The value of the equity of redemption is the cost of removal of the encumbrance, not the market value of the property.
Taxation De Novo — Conditions for Ordering
A taxation de novo should be ordered only where: (i) the original taxation was null or defective; (ii) the interests of justice require it; and (iii) no injustice will be occasioned to the other party. These conditions are conjunctive.

Legislation cited (4)

Cases cited (23)

  • Mohamed Kalisa v Gladys Nyangire Karumu and Two Others (Supreme Court Civil Reference No. 139 of 2013)
  • Banco Arabe Espanol v Bank of Uganda (Supreme Court Civil Appeal No. 8 of 1998)
  • Mbogo and another v. Shah [1968] 1 EA 93
  • National Insurance Corporation v. Mugenyi and Company Advocates [1987] HCB 28
  • Wasswa J. Hannington and another v. Ochola Maria Onyango and three Others [1992-93] HCB 103
  • Devji v. Jinabhai (1934) 1 EACA 89
  • H.K. Shah and another v. Osman Allu (1974) 14 EACA 45
  • Patel v. R. Gottifried (1963) 20 EACA, 81
  • Haji Nadin Matovu v Ben Kiwanuka (Supreme Court Civil Application No. 12 of 1991)
  • Sheikh Jama v. Dubat Farah [1959] 1 EA 789
  • Hussein Janmohamed and Sons v. Twentsche Overseas Trading Co Ltd [1967] 1 EA 287
  • Thomas James Arthur v. Nyeri Electricity Undertaking [1961] 1 EA 492
  • Bank of Uganda v Banco Arabe Espanol (Supreme Court Civil Application No. 23 of 1999)
  • Steel construction and Petroleum Engineering (EA) Ltd v. Uganda Sugar Factory Limited [1970] EA 141
  • Kabanda v Kananura Melvin Consulting Engineers (Supreme Court Civil Application No. 24 of 1993)
  • Makumbi and another v. Sole Electrics (U) Ltd [1990-1994] 1 EA 306
  • Premchand Raichand Ltd and Another v. Quarry Services of East Africa Ltd and others [1972] EA 162
  • Attorney General v Uganda Blanket Manufacturers (Supreme Court Civil Appeal No. 17 of 1993)
  • Bashiri v Vitafoam (U) Ltd (Supreme Court Civil Application No. 13 of 1995)
  • Habre international Ltd [2000] EA 98
  • First American Bank of Kenya v. Shah and others, [2002] 1 EA 64
  • Republic v. Minister of Agriculture and 2 others Exparte Samuel Muchiri W'Njuguna and others [2006] 1 E.A.359
  • Re Wallis (1890) LR 25 QBD 176

Cases citing this judgment (2)

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.

Full judgment

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

Visare Uganda Limited v M S Gadala and Nshekanabo Advocates (Civil Appeal 1322 of 2021) [2021] UGCommC 192 (9 December 2021)
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.