Wanzala Enterprises Ltd v Barclays Bank Uganda Ltd (Miscellaneous Application No. 754 of 2016)

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

The court dismissed the application to disqualify the auditor/arbitrator on grounds of conflict of interest. While the applicant alleged that one partner in the auditing firm was a director of the respondent bank, the court found the objection was raised 10 months after the draft report was issued, well beyond the 15-day period prescribed by section 13(2) of the Arbitration and Conciliation Act. The court also held that the reconciliation was handled by a different arbitrator (Mr Kwizina), not the partner with the alleged conflict, and directed the auditor to proceed to file the final award within 14 days.

Outcome

Application dismissed; arbitrator directed to file final award within 14 days

Facts

Wanzala Enterprises Ltd (applicant) and Barclays Bank Uganda Ltd (respondent) were parties to Civil Suit No. 77 of 2012 concerning account reconciliation. By consent filed on 10 October 2014, the parties appointed Mungereza & Kariisa, Certified Public Accountants as auditors/arbitrators to reconcile their accounts under section 27(c) of the Judicature Act. The reconciliation was assigned to Mr Thomas Kwizina, a partner in the firm. After the auditors issued a draft report in July 2015, the applicant's managing director, Mr Joshua Kasibbo, wrote in October 2015 alleging he had only recently learned that another partner, Mr Joram Kariisa, was a director of the respondent bank. The applicant demanded the audit process be halted, citing conflict of interest. The auditors maintained that Mr Kariisa had disclosed his directorship to Mr Kasibbo before the appointment and that Mr Kwizina, not Mr Kariisa, was handling the reconciliation. No final report was issued as the auditors refused to proceed until the applicant's lawyers withdrew their objection letter. In April 2016, the parties attempted to agree on a new auditor, but disagreements arose. The applicant filed this application in August 2016 seeking disqualification of the auditors and appointment of a new arbitrator.

Issues

1. Whether the arbitrator/referee appointed to reconcile the parties' accounts is incapable of acting by reason of conflict of interest or likelihood of bias arising from the directorship of one partner (Mr Kariisa Joram) in the respondent bank.
2. Whether the applicant waived its right to object to the arbitrator on grounds of conflict of interest.
3. Whether the challenge to the arbitrator was made within the prescribed time under the Arbitration and Conciliation Act.

Orders

• Application dismissed.
• The arbitrator assigned (Mr. Kwizina) shall proceed to file his final award by answering the questions in the terms of reference within 14 days from the date of the ruling.
• The auditor is directed not to involve Mr. Kariisa in the final award.
• Costs of this application shall abide the outcome of the main suit.

Rules and key headnotes

Legislation cited (13)

• Judicature Act Cap 13 s.26
• Judicature Act Cap 13 s.27
• Judicature Act Cap 13 s.28
• Civil Procedure Act Cap 71 s.98
• Civil Procedure Rules Order 47 r.5(1)(b)(ii)
• Civil Procedure Rules Order 47 r.5(2)
• Civil Procedure Rules Order 47 r.3(2)
• Civil Procedure Rules Order 47 r.2
• Civil Procedure Rules Order 47 r.10
• Civil Procedure Rules Order 47 r.15
• Arbitration and Conciliation Act Cap 4 s.9
• Arbitration and Conciliation Act Cap 4 s.12
• Arbitration and Conciliation Act Cap 4 s.13

Cases cited (6)

• Uganda v Patricia Ojangole (Criminal Case No. 1 of 2013)
• Commonwealth Bank of Australia v Smith (1991) 102 ALR 477
• R v Bow Street Metropolitan Stipendiary Magistrate and Others ex parte Pinochet Ugarte (No. 2) (1999) 1 All ER 577
• Juuko v Opportunity Uganda Ltd (Civil Suit No. 327 of 2012)
• Nilefos Minerals Ltd v Abmak Associates (High Court Miscellaneous Application No. 60 of 2014)
• Prince Jefri Bolkiah v KPMG (a firm) [1999]

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.

• Wanzala Enterprises Ltd v Barclays Bank of Uganda Ltd (Miscellaneous Application No. 946 of 2016)

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