Court name
Commercial Court of Uganda
Judgment date
21 December 2010

Shell (U) Ltd. & 9 Ors. v Rock Petroleum & (U) Ltd. & 2 Ors (Misc. Appl. No. 645 Of 2010 (2)) (Miscellaneous Application-2010/645) [2010] UGCommC 38 (21 December 2010);

Cite this case
[2010] UGCommC 38


THE REPUBLIC OF UGANDA
IN THE HIGH COURT OF UGANDA AT KAMPALA
(COMMERCIAL DIVISION)
MISCELLANEOUS APPLICATION NO. 645 OF 2010 (NO. 2)
(ARISING FROM MISCELLANEOUS APPLICATIONS
NO. 622 & 625 OF 2010)

 

1.       SHELL (U) LTD                               }
2.       KOBIL (U) LTD                               }
3.       GAPCO (U) LTD                               }
4.       MGS INTERNATIONAL (U) LTD        }
5.       DELTA PETROLEUM LTD               }
6.       FUELEX (U) LTD                              }:::::::::::::::::::::::APPLICANTS
7.       CITY OIL LTD                                }
8.       HASS PETROLEUM LTD                         }
9.       NILE ENERGY LTD                    }
10.      PETRO LINK (U) LTD                         }

                                                               VERSUS

1.       ROCK PETROLEUM (U) LTD            }
2.       UGANDA REVENUE AUTHORITY         }:::::::::::::::::::RESPONDENTS
3.       M/S MUWEMA & MUGERWA              }
ADVOCATES & SOLICITORS            }


[Appeal from the decisions of Her Worship Gladys Nakibule Kiseka (Deputy Registrar) in Commercial Court Miscellaneous Applications No. 622 & 625 of 2010 dated 15th and 23rd November 2010, respectively]


 

BEFORE: HON. LADY JUSTICE IRENE MULYAGONJA KAKOOZA


RULING
The applicants (hereinafter called “the appellants”) brought this appeal under the provisions of s.62 (1) of the Advocates Act and rule 3 of the Advocates (Taxation of Costs) (Appeals and References) Regulations. They sought for orders that the ruling and orders of the Deputy Registrar of this court in Misc. Application 622 of 2010 be set aside. They also sought for a declaration that the private fee agreement dated 1/09/2009, between the 1st and the 3rd respondents was null and void and unenforceable against the 1st respondent and/or any other person not party to it. They also sought for costs of the appeal.

This appeal will go down in the annals of legal history in this jurisdiction because it represents one of those rare ocassions on which the professional conduct of advocates has been placed under scrutiny and on trial before a court of law, as opposed to the Disciplinary Committee of the Uganda Law Council. Although the matter started off as a tiff between several firms of advocates over their clients’ money and the fees demanded by the 3rd respondent firm out of those monies, when M/A 625/2010 and this appeal were filed, the whole matter became a disciplinary proceeding. I say so because s.1 (f) of the Advocates Act defines “disciplinary proceedings” as any proceedings before the Disciplinary Committee or the High Court on appeal in which consideration is being given to the question whether an advocate should be punished for professional misconduct. As will become apparent later on in this judgment, the appellants do not only want the orders of the Deputy Registrar in M/A 622/2010 set aside, they also propose that an order be made denying the 3rd respondent firm from recovering any costs or fees in respect of O.S. 009/2009 because of the manner in which they conducted themselves before that suit was filed, and in the subsequent proceedings for recovery of their fees.
 

Last, but by no means the least, the appeal is crucial at this point in time because it raises questions about the duties of the courts and judicial officers to the general public, as well as the duties of advocates to the courts and to their clients during judicial proceedings. It also reveals the appalling manner in which representative actions, which are meant to be suits in the public interest, are abused by advocates in this jurisdiction. But most significantly, this appeal calls upon us as judicial officers, to ponder upon the solemn oath taken when ascending to the bench: “to well and truly exercise the judicial functions entrusted to us and do right to all manner of people in accordance with the Constitution of the Republic of Uganda as by law established and in accordance with the laws and usage of the Republic of Uganda without fear or favour, affection or ill will.” In that connection, Sir Francis Bacon, Francis Bacon (1561-1626); Essays, Civil and Moral; The Harvard Classics. 1909-14, Of Judicature that great philosopher and jurist wrote:-
 
“The principal duty of a judge is to suppress force and fraud; whereof force is the more pernicious when it is open, and fraud when it is close and disguised. Add thereto contentious suits, which ought to be spewed out, as the surfeit of courts. A judge ought to prepare his way to a just sentence, as God useth to prepare his way, by raising valleys and taking down hills: so when there appeareth on either side an high hand, violent prosecution, cunning advantages taken, combination, power, great counsel, then is the virtue of a judge seen, to make inequality equal; that he may plant his judgment as upon an even ground. …”
 
The hearing of this appeal was one where my skills as a Judge were tested to their utmost limits. I had in the couple of years before that presided over numerous trials of murderers, robbers, rapists and child abusers, but I am constrained to admit that never before had I encountered as much cunning and deceit in judicial proceedings as I did with the group of advocates that were being called to account in this appeal. Neither had I ever suffered as much anxiety and stress as I had to endure during the hearing of this appeal. But I rest assured and do hope that the result of my perseverance, which is the planting of this judgment on what appears to be almost virgin terrain in Ugandan jurisprudence in the area being contested, will ease the work of my brothers and sisters on the bench in years to come.
 
The facts that led to this appeal can be summarised as follows. The 1st respondent herein and over 50 other companies are suppliers of petroleum and diesel products in Uganda. On 1/09/2009 they filed O.S 009 of 2009, Rock Petroleum (U) Ltd. v. Uganda Revenue Authority (URA). In the suit, the plaintiffs who were represented by Rock Petroleum (U) Ltd., by virtue of an order that this court granted her on the 7/04/2009, sought the recovery of taxes (Excise Duty) that had been wrongly collected from them following an order made by the Minister of Finance under the Taxes and Duties (Provisional Collection) Act, but which had expired. The 3rd respondent firm were retained by Rock Petroleum (U) Ltd. to prosecute the suit.

On the day that they filed O.S 009/2009 (01/09/09) the 3rd respondent firm entered into an agreement with the 1st respondent to secure the payment of their professional fees (hereinafter called “the fee agreement” or “the remuneration agreement”). For clarity of the arguments that were made by the advocates that appeared in the appeal, and in order to facilitate a better understanding of the conduct of the advocates from the 3rd respondent firm in these proceedings, I will set down the relevant parts of the fee agreement, verbatim.

 
“THIS AGREEMENT is made this 1st day of September 2009 BETWEEN MUWEMA & MUGERWA ADVOCATES of P. O. Box 6074 Kampala {hereinafter referred to as the “ADVOCATES” which expression shall include their successors and assigns} on the one part AND ROCK PETROLEUM (U) LTD which was granted permission by court to sue URA in a representative suit on its behalf and on behalf of numerous importers of Diesel and Petrol seeking refund of monies illegally collected by URA on Excise Duty {hereinafter referred to as the “CLIENTS” which expression shall include their successors and assigns} on the other part.

WHEREAS
1.      

The client has instructed the Advocates to research and investigate the viability of maintaining legal action against Uganda Revenue Authority and thereafter to pursue appropriate action in respect of refunds of monies allegedly collected as Excise Duty in 2007/2008 Financial Year.

2.      
The subject matter is involving, big and complex and the Advocates have agreed with the clients for a negotiated fee over and above what is provided for in the Advocates Remuneration Rules.

3.      
Further in consideration of the Advocates meeting all necessary statutory and contingency expenses required to pursue the matter.

(NOW) THIS DEED WITNESSES AS FOLLOWS:
1.      
The Advocates shall be entitled to costs of the suit and an additional fee which is equivalent to 16% of the total proceeds of the clients’ claims or whatever total sum of the claim that the Court shall finally award or declare to be due to the clients.

2.      
In the event the Recovery process is protracted by Appeal process Advocates shall be entitled to a further 4% of the total claim.

3.      
Each of the parties and/or any of those represented by them shall be irrevocably, jointly and severally bound by the agreement.

Wherefore the parties have laid their respective hands, the day first above mentioned.”

To my mind, the fee agreement above, reads like a document drawn out of legal fiction, given the fact that according to the National Household Survey 2009/2010 Uganda Bureau of Statistics, National Household Survey, 2009/2010 7.2 million out of the 30 million-plus Ugandans still live below the poverty line, compared to 8.4 million in 2005/2006. The cost of doing business in Uganda remains high and one of the culprits named in bringing this about in the Doing Business Report Doing Business 2010, Uganda, The International Bank for Reconstruction and Development/World Bank is the high cost of litigation. It is stated in that report that the cost of recovery of a claim in a suit in the Commercial Court at Kampala sometimes goes up to 44.9% of the claim, compared to Tanzania where it is 14.3% of the claim; the fact that the legal costs are very high makes doing business in Uganda more expensive, less efficient and the country less competitive. It also makes justice less accessible to the ordinary Ugandan businessperson.
 
Under the Commercial Justice Reform Program, through which the Commercial Court was established, a number of indicators were designed to measure progress of the Court in the area of improving access to justice. They included reduction in the user perception of corruption. A “Follow Up” Commercial Justice Survey Draft Report of 2004 suggested that the private sector perception of corruption among lawyers had increased from 38% to 63%. The establishment and training of a competent and ethical commercial bar was therefore one of the goals of establishing the Commercial Court. Interventions under this category were geared at strengthening the legal profession and enhancing access to legal advice and representation. Justice, Law and Order Sector Strategic Investment Plan, Mid-Term Evaluation Report, 2001/2-2005/6

Commercial lawyers are key actors in the commercial justice system and it is crucial that they embrace reforms in the commercial justice sector. They should never be among the categories of persons cited for perpetrating blatant abuses of court process. It is therefore the business of this court, and indeed any other court in the land, to ensure that the costs in suits before it are reasonable. Further that the lawyers that appear before the courts do not abuse the court process, and if at all, not with impunity; the two goals are important aspects of public policy.


Going back to the contested agreement, it was executed between Mr. Fred Muwema, one of the Advocates in the 3rd respondent firm, and 2 directors of Rock Petroleum (U) Ltd. It was also notarised and the Notary Public, Ms. Innocent Ngobi Ndiko, verified that she had explained the contents of the agreement to the directors of Rock Petroleum Ltd, and that they appeared to have understood it. A copy of the agreement was then deposited with the Secretary of the Uganda Law Council.

The suit was successful and judgment was delivered by my brother Lameck Mukasa, J., on 20/07/2010. In his judgment he ordered that URA accounts to court for all monies that had been collected from the plaintiffs in excess of what was due from them, and refund it to them. He also ordered that URA file a statement of that account in court, and finally that the costs of the suit be borne by the Defendant, URA. Pursuant to that, on the 12/08/2010 URA filed a statement of account in court, dated 9/08/2010, which showed that the amount due to over 50 suppliers of petroleum products operating in Uganda was shs 56,184,191,050/=.

On 2/09/2010, the 3rd respondent firm demanded for payment of their fees, per agreement with the 1st respondent, from URA. But URA refused or neglected to pay the equivalent of 16% of shs 56,184,191,050/=, as claimed (i.e. about shs. 8.9 billion). The 3rd respondent firm then filed Misc. Application No. 622 of 2010, under the provisions of s.61 of the Advocates Act and rules 4 and 5 of the Advocates (Remuneration & Taxation of Costs) Rules (which prohibit charging below scale fees and provide for additional fees for exceptional dispatch, respectively). The 3rd respondents sought for an order that the fees agreed upon with the 1st respondent be charged upon and be paid wholly from the monies held by the judgment debtor (URA) on account of refunds to all the petroleum product suppliers in Uganda.

A ruling on the application was delivered by the Learned Deputy Registrar of this court on 15/11/2010, and on the same day the resultant order was extracted and served upon URA. The appellants herein, being 10 of the petroleum and diesel suppliers and some of whom had the largest amounts of money owing from URA, were aggrieved by the order of the Deputy Registrar because they had also filed in this court Misc. Application 625/2010. In that application the appellants sought to be added as parties to O.S 009/2009. They also sought to challenge the fee agreement above as illegal and not binding on them, and for a declaration to that effect.

The Deputy Registrar heard M/A 625/2010 on the same day that she entertained the appellants’ M/A 622/2010 to charge their fees upon the judgement debt. But for some unexplained reason, the registrar chose to deliver the ruling in M/A 622/2010, allowing the 3rd respondent firm to have their fees charged upon the judgement debt, before making a decision about the issues raised by the applellants here in M/A 625/2010, whether the fee agreement between the 1st and 3rd respondents was legal and binding upon them. The appellants therefore filed this appeal against the Registrar’s decision in M/A 622/2010, as well as against her failure to deliver the ruling in M/A 625/2010, before placing charging liens on the appellants’ monies held by URA.


The grounds stated in the chamber summons in this appeal were that the learned Deputy Registrar of the Commercial Court in her capacity as Taxing Officer erred in law and fact when she failed to properly construe and apply certain provisions of the Advocates Act in M/A 622/2010. Further that the Registrar condoned an illegality and she failed to exercise her jurisdiction judicially. That as a result, it was in the interests of justice that the decision and orders of the Registrar be set aside and that the orders proposed in the appeal be granted in favour of the appellants.

The application/appeal was supported by the affidavit of Tom Magezi, an advocate practicing with M/s Tumusiime, Kabega & Co Advocates, which he deposed on 17/11/2010. It was further supported by an affidavit in rejoinder deposed by the same Tom Magezi on 29/11/2010. The respondents, excluding the 2nd respondent, opposed the appeal. They lodged an affidavit in reply deposed by Allan Dokoria, a director in the 1st respondent company, on 29/11/2010. A second affidavit in reply was deposed by Herbert Kiggundu Mugerwa, a partner in the 3rd respondent firm. Having filed no reply, and I believe having no real interest in opposing the appeal, when the appeal was called on for hearing, Mr. Tumusiime informed court that Counsel for the 2nd respondent, Mr. Moses Kazibwe, was in court earlier that morning but intimated that he was unwell. Further, that Mr. Kazibwe had no objection to the appeal proceeding in his absence, and that he (Mr. Tumusiime) had instructions to address court on behalf of the 2nd respondent as well.
 

In his affidavit in support, Tom Magezi deposed that the Registrar in her capacity as the Taxing Officer erred in law and fact when she failed to properly construe and apply sections 50, 51, 54 and 61 of the Advocates Act (in Miscellaneous Application No. 622/2010). The grounds raised in Mr. Magezi’s affidavit can be summarised as follows:-

1.      

That Registrar erred when she found that the terms of the remuneration agreement entered into between the 1st respondent and the 3rd respondent law firm were binding on all the beneficiaries to the judgment in O.S. 09/2009.
2.       That the Registrar erred when she found that the 3rd respondents were entitled to a charge in respect of the agreed percentages and terms in the agreement under s.61 of the Advocates Act.
3.       That the Registrar erred when she ordered that the agreed remuneration and legal fees against the 1st respondent and others represented by her be charged and wholly paid to the 3rd respondents out of the Excise Duty refunds for diesel and petrol importers held by the 2nd respondent.
4.       That the Registrar erred when she found that there was no cause for investigating the fee agreement under s.50 (3) of the Advocates Act on the ground that the 2nd respondent was not a party to the agreement.
5.       That the Registrar erred when she found that the agreement, prima facie, fulfilled the requirements of s.51 of the Advocates Act.
6.       That the Registrar erred when she ordered that the 3rd respondents’ “agreed remuneration and legal fees of 16% of the refunds due to their clients (all beneficiaries) be charged and wholly paid to the 3rd respondents out of the re-audited conceded total Excise Duty refunds for the diesel and petrol importers” held by the 2nd respondent.
7.       That the Registrar condoned an illegality by allowing a 16% charge on the Excise Duty refunds on the basis of an agreement that clearly contravened the provisions of the Advocates Act.
8.       That the Registrar failed to exercise her discretion judiciously when she decided to deliver the ruling in M/A 622/2010, and delay the ruling in M/A 625/2010 in which the Appellants herein had pointed out various illegalities that cannot and could not under any circumstances be ignored by court in disposing of either of the applications.
9.      
That the Registrar failed to exercise her discretion judicially by deciding to deliver the ruling in M/A 622/2010 and delaying delivery of the ruling in M/A 625/2010, thereby rendering the latter application redundant and inconsequential, to the detriment and prejudice of the appellants whose constitutional rights to their property (the Excise Duty refunds as ordered by the Judge) were being contravened.

In his affidavit in reply, Mr. Allan Dokoria, one of the Directors in the 1st respondent company, deposed that the 1st respondent was not one of the parties in M/A 622/2010, and that no orders had been granted therein in her favour. Further, that his lawyers had informed him that the appeal now before court disclosed no cause of action against his company. That as a result, the same ought to be struck out as against the 1st respondent, with costs.

In their affidavit in reply, Mr. Herbert Kiggundu Mugerwa, a partner in the 3rd respondent firm deposed that M/A 625/2010 in which the appellants sought to be joined as parties to O.S. 009/2009, and to challenge the fee agreement between his firm and the 1st respondent was heard by the Deputy Registrar but the ruling was yet to be delivered. That M/A 622/2010 and M/A 625/2010 were never consolidated, and that the parties while before the Deputy Registrar in M/A 622/2010 chose not to have the two applications consolidated. He further averred that this appeal by the appellants could not lie and could not be maintained under the provisions of s.62 of the Advocates Act.

Mr. Mugerwa further averred that the issues regarding the legality of the fee agreement in this “purported” appeal were never raised at the trial before the learned Deputy Registrar sitting as an original court. That in fact URA did not dispute the fee agreement but instead sought for directions on which of the advocates (claiming for monies due to the appellants) to pay. Further that the ratio decidendi in the ruling of the Deputy Registrar did not touch on the validity of the fee agreement and consequently no appeal could lie in that respect. He finally averred that the matters (i.e. the illegality or otherwise of the fee agreement) being raised in this appeal were the subject of M/A 625/2010 which the Registrar heard and which was pending her decision. That consequently this court was barred from entertaining them by hearing this appeal.

In an affidavit in rejoinder dated 29/11/2010, Mr. Tom Magezi deposed that contrary to what was stated in Mr. Kiggundu’s affidavit, the decision in M/A 625/2010 was delivered on 23/11/2010, in the presence of Mr. Mulema Mukasa for the 1st and 3rd respondents. He further deposed that contrary to what Mr. Allan Dokoria stated in his affidavit in reply, the 1st respondent was a necessary party to this appeal because it was she that executed the contested fee agreement with the 3rd respondent firm, which they sought to enforce against the appellants here and others. Further that Mr. Dokoria deposed an affidavit portraying the contested agreement to which he annexed a forged letter, alleged to have been signed by Mr. Aloke Kumar Dandapat, the Country Head of Gapco (U) Ltd., the 3rd appellant company. And that for that reason too, the 1st respondent was a necessary party to this appeal.

Before the appeal was called on for hearing on 30/11/2010, in the afternoon of 29/11/2010 the 3rd respondents filed written submissions in court in which they raised 5 points of law in limine as follows:-

i)      

That an appeal under s. 62 of the Advocates Act could only be in respect of taxation decisions;
ii)      That no appeal lies from decisions made under s.61 of the Advocates Act;
iii)     That the appeal now before court was barred by ss.5 and 6 of the Civil Procedure Act;
iv)      That new matters of fact and law could not be entertained on appeal; and finally,
v)       That the appellants herein had no cause of action against Rock Petroleum (U) Ltd., the 1st respondent.

In their written submissions, the 1st and 3rd respondents’ advocates, the 3rd respondent firm together with Mr. Mulema Mukasa, submitted that the preliminary points of law were capable of and should dispose of the whole appeal. On the other hand, when the advocates for all the parties appeared before on the morning of 30/11/2010, Mr. Tumusiime who led counsel for the appellants was of the view that the preliminary objections could be addressed in the course of hearing the appeal and that he would therefore address them together with the grounds raised therein. Having considered the objections in writing before the appeal was called on for hearing, I agreed with Mr. Tumusiime’s proposition in that regard. The 1st and 3rd respondent’s advocates were therefore taken aback when I reserved my decision on the points of law and ordered that the appeal proceed on its merits.

Counsel for the 1st and 3rd respondents’ advocates, i.e. Mr. Muwema and Mr. Mugerwa, appearing pro se, together with the advocate they had retained to assist them, Mr. Mulema Mukasa then decided to resist my decision by applying that I disqualify myself from entertaining the appeal. They did so because in the opinion of Mr. Fred Muwema who led the team, I was biased and therefore “not the proper judicial officer to entertain the appeal.” I responded to the application resisting the attempts of the 1st and 3rd respondents to choose a judicial officer to hear their case and declined to disqualify myself in my ruling dated 8th December 2010, Shell (U) Ltd. & 9 Others v. Rock Petroleum (U) Ltd., Uganda Revenue Authority & Muwema & Mugerwa, Advocates & Solicitors, M/A 645/2010 (No.1). Since the appellants’ advocates have now offered submissions in reply to the objections, I will proceed to address the preliminary points of law that were raised by the 1st and 3rd respondents.

Regarding the 1st and 2nd objections, it was argued for the 1st and 3rd respondents that this court has no power to entertain an application for a declaration over the impugned fee agreement brought under the provisions of s.62 of the Advocates Act. Further that their M/A 622/2010 for charging orders was brought under the provisions of s.61 of the Advocates Act. They further argued that proceedings for charging orders under s.61 of the Advocates Act are not taxation proceedings and therefore, they cannot be appealed against under the provisions of s.62 of the Act.

Counsel for the 1st and 3rd respondents further contended that no taxation proceedings arose in this case under s.61 Advocates Act because there was a fee agreement to provide for their remuneration. Further that s.54 of the Advocates Act “expressly outlaws” taxation of costs of an Advocate where there is a fee agreement, except as is provided for by s.52 of the Act, i.e. in the case of death or incapacity of an Advocate under s.53 of the Act. They also contended that the appellants here could not assume that they were aggrieved by a decision of a ‘Taxing Officer’ so as to bring them under the operation of the provisions of s.62 of the Act because no decision was made by a “Taxing Officer” but the Registrar sat as “a court” when she entertained their M/A 622/2010. They then concluded that this court is enjoined to construe the words in s.62 of the Advocates Act in their literal and ordinary meaning without reading other words into the provision. Counsel then cited the decision in the Registered Trustees of Kampala Institute v. Departed Asians Property Custodian Board SCCA 21/93 and Vickers & Sons Ltd. v. Evans [1950] AC 444, in support of thier submissions.

Regarding the 2nd objection, which was closely related to the 1st, counsel for the 1st and 3rd respondents contended that the right of appeal is a creature of statute. They then submitted that there is no provision of the Advocates Act that provides for a right of appeal against orders made under s.61 thereof. They listed the orders that, in their view, were appellable under the Act and maintained that appeals under s.61 of the Act were not provided for. They then concluded that the High Court had no powers to entertain appeals from orders made under s.61 Advocates Act and cited the provisions of Article 139 of the Constitution which provides for the original and appellant jurisdiction of the High Court which must be conferred upon it by the Constitution or other law.

In reply Mr. Andrew Kibaya, for the appellants, submitted that the appeal was properly brought under the provisions of s. 62 of the Advocates Act. He argued so because in his opinion, all orders made under Part VI of the Advocates Act can be appealed against under the provisions of s.62 of the Act. He went on to state that the appellants were aggrieved by the orders made by the Taxing Officer under that part of the Act, i.e. under s.61 of the Act. He asserted that the powers that the Deputy Registrar exercised under s.61 of the Act were powers of a Taxing Officer. He took the argument further by stating that the Registrar could only exercise the powers of a Taxing Officer under s.61 of the Advocates Act if a charging order was requested in respect of taxed costs. That indeed the Deputy Registrar referred to the interpretation of the word “costs” in s.1 (d) of the Act, at page 14 of her ruling (line 11) where she stated that costs include fees, charges, disbursements, expenses and remuneration.

Mr. Kibaya further contended that for the 1st and 3rd respondents’ Advocates to then argue that the Registrar did not act in her capacity as Taxing Officer would be to ‘kick themselves in the foot’ because they would then be asserting in the same breath that she did not have the powers to issue the orders that she did in M/A 622/2010, because they did not result from a taxed bill in respect of which she had the powers to issue charging orders. He then submitted that because there was no taxed bill of costs, the Registrar’s decision and orders under s.61 of the Advocates Act were illegal.

Mr. Kibaya went on to point out that for purposes of s.80 of the Advocates Act, the Registrar is the Taxing Officer. He also argued in the alternative that if court found that the Registrar did not act as a Taxing Officer and that therefore an appeal could not lie against her decision under s.62 of the Act, then Order 50 rule 8 of the Civil Procedure Rules (CPR) ought to be considered because it provides for appeals from orders made by the Registrar. He also relied on the decision in the case of Saggu v. Roadmaster Cycles (U) Ltd. [2002] 1 EA 259, where the Court of Appeal ruled that where an application omits to cite any law at all, or cites the wrong law but the jurisdiction to grant the order exists, the irregularity or omission can be ignored and the correct law inserted.

I did dispose of the question whether or not an appeal would lie against the decision of the Registrar under s.61 of the Advocates Act by dint of s.62 (1) thereof in my ruling in M/A 646/2010, Shell (U) Ltd. & 9 Others v. Rock Petroleum (U) Ltd & 2 Others. But it appears counsel for the 1st and 3rd respondents were not satisfied with the manner in which I treated the subject. Before I render a similar decision on that point, it will be beneficial to lay down the contested provision, verbatim.
 

“62. Appeals and references.

(1) Any person affected by an order or decision of a taxing officer made under this Part of this Act or any regulations made under this Part of this Act may appeal within thirty days to a judge of the High Court who on that appeal may make any order that the taxing officer might have made.”
                                                                        {My Emphasis}
 
If one were to employ the literal rule of interpretation which was favoured by counsel for the 1st and 3rd respondents, and which means that words that are reasonably capable of only one meaning must be given that meaning whatever the result, my understanding of s.62 (1) of the Advocates Act would result in a finding that the current appeal is properly before court. I therefore agree with Mr. Kibaya’s submission that s.62 (1) of the Act provides for the right to appeal against any order that is made under Part VI of the Act, i.e. to do with Accounting by Advocates. Part VI of the Act encompasses sections 40 to 63 of the Act. And simply put, orders under s.61 are orders made under Part VI of the Act. They are therefore without a doubt subject to appeals and references under the provisions of s.62 (1) of the Act.
 
As I ruled ealier in M/A 646/2010, the appellants here fall under the categories of persons entitled to bring this appeal even though they were not party to the original M/A 622/2010. I say so because the 1st and 3rd respondents claimed that the applicants herein and all the other beneficiaries to the judgment in O.S 009/2009 should pay their fees. They are therefore persons that are alleged to be liable to pay the 3rd respondents’ fees within the terms of s. 50 (3) Advocates Act, according to their fee agreement with the 1st respondent. There is therefore no doubt that they have the right to appeal against the decision of the Registrar against them, even though their advocates were denied the opportunity of making any representations in M/A 622/2010.

Why then do I come to the conclusion that the appellants have the right to appeal even though they were not party to M/A 622/2010? The right of appeal that is provided for in s.62 (1) of the Advocates Act seems to be permissive, not prohibitive. The category of persons vested with the right is very broad and general. “Any person affected” by an order or decision of the taxing officer made under Part VI of the Act or any regulations made under Part VI of the Act may appeal against it to a judge of the High Court. Since the judge has the jurisdiction in the appeal to make any order that the taxing officer would have made, to my mind that means that the appeal can be entertained by the judge as any other case would be at first instance, i.e. with the new parties added thereto.

My further understanding of the provisions of s.62 (1) of the Advocates Act is that the appeal need not be about questions that were raised in the application for charging orders, as is the case in this appeal. This is so because of course the appellants need not have been party to the application for charging orders; their qualification to appeal is that they were “affected by the order or decision”, which was to the effect that they had to part with property that had been recovered in a suit on their behalf, especially when they were not heard before the decision or orders were made. And without being heard, the appellants, among other plaintiffs in O.S. 009/2009, had to part with almost Ushs. 9 billion as a result of that order. No court of justice would allow any person to lose such colossal amounts of money without giving them a hearing because of the provisions of Article 26 of the Constitution of the Republic which provides as follows:-
 

26. Protection from deprivation of property.
(1) Every person has a right to own property either individually or in association with others.
(2) No person shall be compulsorily deprived of property or any interest in or right over property of any description except where the following conditions are satisfied—
(a) the taking of possession or acquisition is necessary for public use or in the interest of defence, public safety, public order, public morality or public health; and
(b) the compulsory taking of possession or acquisition of property is made under a law which makes provision for—
(i) prompt payment of fair and adequate compensation, prior to the taking of possession or acquisition of the property; and
(ii) a right of access to a court of law by any person who has an interest or right over the property.

In the circumstances of Part VI of the Advocates Act, s.62 (1) thereof meets the requirements of Article 26 (2) (b) (ii) of the Constitution. The appellants were the owners of the monies wrongly collected by URA as Excise Duty. It therefore follows that what they claimed in O.S. 009/2010 was their money which was wrongfully received by URA, and which was recovered in that suit as money had and received. It then automatically follows that before the Registrar could purport to make an order to have URA pay a substantial part of that money to the 3rd respondent firm without the consent of the appellants, notwithstanding the representative order made in favour of the 1st respondent in M/A 181/2009, it was the appellants’ constitutional right to be given a hearing. That would ensure that their rights to the money/property, vis-

-vis the 3rd respondents’ claims for fees are determined before the Registrar or the court, as the case may be, could make any orders to give away substantial portions of, or any part of it.
 

It was therefore erroneous of counsel for the 1st and 3rd respondents to argue that this court presumed a right of appeal where it was not. The right to appeal against orders made under the whole of Part VI of the Advocates Act is clearly derived from s.62 (1) of the Act, and the Advocates (Taxation of Costs) (Appeals and References) Regulations. And in the alternative, if s.62 (1) Advocates Act does not apply, Order 50 rule 8 CPR applies because it empowers any person aggrieved by any order of a registrar to appeal against the order to the High Court.

But perhaps, as Mr. Andrew Kibaya submitted for the appellants, the 3rd respondents were mistaken when they brought an application for charging orders under s.61 of the Advocates Act against the judgment debt based on the contested remuneration agreement. I will therefore next explore the import of s.61 of the Advocates Act, vis-

-vis agreements for the remuneration of advocates.

 
The 3rd respondents argued that when the Registrar entertained their application for a charging order, she sat as a court and not as a Taxing Officer. And that she did so because costs are defined in s.1 (d) of the Advocates Act to include fees, charges, disbursements, expenses and remuneration; and that therefore, their remuneration agreement was encompassed in the definition of costs. That as a result, the said agreement could be subjected to the procedures envisaged by s.61 Advocates Act.

However, s. 61 whose application to the remuneration agreement was strongly contested in the appellants’ submissions provides as follows:-
 
61. Charging orders.
Any court in which an advocate has been employed to prosecute or defend any suit, matter or proceeding may at any time declare the advocate entitled to charge on the property recovered or preserved through this instrumentality for his or her taxed costs in reference to that suit, matter or proceeding, and may make such orders for the taxation of those costs and for raising money to pay or for paying those costs out of that property as it thinks fit, and all conveyances and acts done to defeat, or operating to defeat, that charge shall, except in the case of a conveyance to a bona fide purchaser for value without notice, be void as against the advocate; but no order shall be made if the right to recover the costs is barred by limitation.                         {My Emphasis}

If the provision reproduced above were to be subjected to interpretation using the literal rule of statutory interpretation, which was favoured by the 3rd respondent firm, my understanding of it would be that charging orders under s.61 of the Act apply only to taxed costs; not to costs due by agreement because such are not liable to taxation, as was ably submitted by the advocates from and for the 3rd respondent firm. If the legislature had deemed it fit to include remuneration agreements for percentage or lump sum fees among fees for which property recovered in a suit could be charged under s.61 of the Act, such as the fees in the impugned agreement in this appeal, then it would have specifically said so.

Given that interpretation therefore, and without embellishing the language that was used by the legislature with any other colour of meaning, if the 3rd respondent firm had opted to comply with the order of the trial judge to have their costs paid by the 2nd respondent (the defendant in O.S. 009/2009) they would have met with no resistance whatsoever from the appellants here. The Registrar would have then taxed their bill based on the sum that was recovered under the judgment (i.e. UGX 56 billion, or such sums as were agreed upon by the Ministry of Finance after the audit) to be paid by the 2nd respondent. The fees could have then fallen within the ambit of the situations envisaged by s.61 of the Advocates Act.

It is also my carefully considered opinion that the application under s.61 of the Act could not arise here because there was no order requiring the 1st respondent or any of the beneficiaries to the judgement in O.S 009/2009 to pay the taxed, or any costs of the suit at all. If that had been the case here, in the event that the 1st respondent and the other beneficiaries to the judgment refused to honour the court order to pay such costs, then and only then would the 3rd respondent firm have had recourse to the provisions of s.61 of the Advocates Act. I will return to the question whether any fees were payable to the 3rd respondents by the beneficiaries to the judgment in O.S 009/2009, other than the 1st respondent, later in this judgment.
 

Regarding counsel for the 1st and 3rd respondents’ submission that when the Registrar entertained M/A 622/2010 she did so as “a court” and NOT as a Taxing Officer, s. 80 of the Advocates Act provides that the Taxing Officer
 
“… shall be the registrar or a district or deputy registrar of the High Court or, in the absence of a registrar, such other officer as the Chief Justice may appoint; except that in respect of the taxation of costs between party and party arising out of any contentious business brought in a court subordinate to the High Court, the taxing officer shall be a chief magistrate or a magistrate grade I with jurisdiction in the area where the suit was heard.”
 
And as I found and held above, the provisions of s.61 of the Advocates Act envisaged that before a charging order could be made, it had to be preceded by the taxation of the costs of the suit, and according to the immediately forgoing provision, that had to be done by a Taxing Officer. In that case the person charged to pay, if it had been the beneficiaries to the judgment in O.S. 009/2009, which it was not, would have been subjected to an application under s.61 of the Advocates Act, for an order charging the property recovered in the suit (the refunds held by URA) to pay the costs due to the 3rd respondent. It is emphasised here that the main respondent in such an application would, of necessity be the person who is charged to pay the costs, not only the person holding the property that would be subject to the charging liens. An application brought against the person holding the property to be charged alone, as was the case in M/A 622/2010, denies the person(s) alleged to be liable to pay the fees of an opportunity to defend their properietory rights, a denial of the non-derrogable right to be heard which is enshrined in Article 28 of the Constitution of the Republic.
 
I would hazard to add here that, my understanding of the word “court” in the definition Any court in which an advocate has been employed to prosecute or defend any suit,” would in this case mean a court presided over by a Judge, not a registrar as counsel for the 1st and 3rd respondents argued. I say so because the powers of Registrars are curved out for them in Order 50 CPR. And the functions of the Registrar as “a court” are limited and set out in Order 50 rule 6 CPR. The Registrar is only constituted into a court for purposes of rules 1, 2, 3 and 4 of that Order or the Civil Procedure Act (CPA). I will throw some more light on that.

Rule 1 of Order 50 is rather broad. It provides that whenever in the CPA or in the rules under the Act, it is provided that any act or thing shall be done by such officer as the court may appoint, that act may be done by the Registrar. I do not think that this court appointed the Registrar to make charging orders of the nature that she made in M/A 622/2010. In any event, as I have already found, the particular order made offended the provisions of s.61 of the Advocates Act under which it was made. I have also found no provision in the CPA that empowers the Registrar to make orders for costs that are contrary to those made by the Judge who entertained the suit or matter in question, except by consent of the person to so pay the costs.

If the court in this case ordered that the plaintiff’s advocates’ costs be paid by the 2nd respondent, that order could not be set aside or varied by the Registrar on the basis of a fee agreement charging other persons not party to it to pay the costs, unless those person had agreed to it. To do so would be to say that by virtue of the provisions of s.61 Advocates Act, the Registrar has the powers to review and or entertain an appeal against a judge’s orders for the payment of costs issued in his/her judgment or final order. It is also my view that such an unfortunate result goes against the golden rule of statutory interpretation which is that the court may depart from the ordinary meaning of a provision only where that would lead to absurdity. In Grey v. Pearson (1857) HL Cas 61, Lord Wenseleydale said:-
 

“The grammatical and ordinary sense of the words is to be adhered to, unless that would lead to some absurdity, or some repugnance or inconsistency with the rest of the instrument, in which case the grammatical and ordinary sense of the words may be modified, so as to avoid that absurdity or inconsistency, and no farther.”

That being the rule, an interpretation of a statute that is absurd is to be preferred to one that is not. Therefore to say that the word “court” in s.61 Advocates Act would mean that the Registrar has powers of an appellate court or the powers to review the orders made by a judge of the High Court would be absurd and thus has got to be avoided. I will return to this aspect of the appeal with regard to the duties of the advocates in the 3rd respondent firm as officers of this court and their duties to the court, as well as in respect of their duties to their client, Rock Petroleum (U) Ltd., later on in this judgment.
 
Going on then to rules 2, 3 and 4 of Order 50 CPR, rule 2 confers powers on the Registrar to enter judgment in uncontested cases. It therefore cannot apply to the situation at hand. Rule 3 refers to formal and interlocutory matters, and such are defined in the rule itself as “formal steps preliminary to the trial, and interlocutory applications.Burton's Legal Thesaurus (4th Edition, William C. Burton (2007) McGraw-Hill Companies, Inc. New York, New York) defines the word “interlocutory” as an adjective that means hyperlink, interemedial, hyperlink, hyperlink, not final, hyperlink, hyperlink, hyperlink, hyperlink, hyperlink and or hyperlink. Associated concepts are given as interlocutory appeals, interlocutory costs, hyperlinks, interlocutory injunctions, interlocutory orders and interlocutory rulings. Applications under s.61 of the Advocates Act are therefore definitely not interlocutory applications.

Finally rule 4 of Order 50 refers to execution. Execution is succinctly defined in the rule itself where it states that “Formal orders for attachment and sale of property and for the issue of notices to show cause on application for arrest and imprisonment in execution of a decree of the high court may be made by the registrar.” That cannot, even by the fartherest stretch of the imagination imply that the issuance of charging orders under s. 61 Advocates Act is also vested in the Registrar. I am fortified in my interpretation of rules 1, 2, 3, 4 and 6 of Order 50 by the decision of the Supreme Court in Attorney General v. James Mark Kamoga & Another, SCCA No. 8 of 2004. In that case, Mulenga, JSC (as he then was) ruled that rule 6 of Order 50 CPR does not create a subordinate court to the High Court. It rather underscores the special status of the Registrar as an official of the High Court to whom some limited functions of the court are delegated. Odoki, CJ, Kanyeihamba, Tsekoko, and Katureebe, JJSC, concured.

It is therefore my carefully considered opinion that on an application for charging orders under s.61 of the Advocates Act, the Registrar should only come into the picture to tax the costs after a competent court (Judge) orders that the taxed costs of the advocate be charged on the property recovered, as well as in the execution proceedings that would ensue after that, should the need arise.

I am also aware of the decision of His Worship Emmanuel Mugabo (then Assistant Registrar of this court) in M/A 376/2007, M/s Muwema & Mugerwa, Advocates v. Uganda Revenue Authority, which arose from O.S 10/2007, Kagoro Friday Roberts & Sempa Matovu B. E. v. URA, in which Mr. Mugabo made a similar order to that which is contested in this appeal. That matter was drawn to my attention when an application attendant to it, HCMA 349/2008, URA v. Muwema & Mugerwa Advocates was cited by counsel for the appellants during the hearing of M/A 646/2010, as a case that was similar to the one at hand. I took judicial notice of the similarity and made an effort to peruse the various rulings and orders related to the matter, as well as the proceedings in the main suit, O.S 10/2007.

Perusal of the record revealed that O.S 10/2007 was filed against URA on 1/10/2007, when the plaintiffs in it brought a representative action for themselves and on behalf of all motorists claiming refunds of pre-paid road licence fees for the Financial Year 2006/2007 (about 50,000 of them) after the same were abolished by the Finance Act. Judgment was entered by an order dated 5/05/2008 taking cognisance of s.3 (3) of the Finance Act, 2007 which provided for refund of all licence fees that had been paid beyond the 30/07/2007. Each party was ordered to pay its own costs.

Similar to what happened before O.S 009/2009 was filed, on the day after O.S. 10/2007 was filed (i.e. on 2/10/2007) the 3rd respondent firm (again represented by Mr. Fred Muwema) entered into a fee agreement with the plaintiffs appointed by court to bring the representative suit. The terms of that agreement were similar to those in the agreement that is contested here. It was there agreed that because the plaintiffs had not paid any legal fees, in consideration of the Advocates meeting necessary statutory and contingency expenses necessary to pursue the matter, the advocates would be entitled to the costs of the suit, and in addition thereto, to a negotiated fee equivalent to 16% of the total proceeds of the clients claims or whatever total sum of any refund that would be awarded or finally agreed. It was further agreed that all outgoing expenses, disbursements and costs incurred by the advocates would be defrayed from the amounts recovered in the claim. It was further agreed that if recovery was delayed by appeals, the Advocates would recover an additional 4% as fees from the judgment debt, and that in the event there was no recovery, the Advocates would only be entitled to the costs of the suit.

The 3rd respondent firm claimed the fees, per agreement, from URA but URA refused to pay them. The 3rd respondent then filed M/A 376/2008 under the provisions of s.61 of the Advocates Act. In that application, the lone contestant of the 3rd respondents’ efforts to have their fees charged and paid from the road licence fee refunds was Mr. Yusuf Kagumire (Advocate). He deposed an affidavit to oppose the deduction of 16% of the fees claimed by the 3rd respondent firm, on account of the fee agreement between them and the court appointed representatives in the suit from the refunds due to him for 2 motor vehicles.

However, Mr. Kagumire’s protest did not see the light of day because the Learned Assistant Registrar, on a preliminary objection on a point of law raised by Mr. Mulema Mukasa, found that though Mr. Kagumire was a proper claimant of his refunds from URA, he did not have the capacity to oppose the application for charging orders. He also found that Mr. Kagumire was a stranger to the suit, because by an order of court there were duly appointed representatives to prosecute it. That as a result his protest could not be entertained in the manner in which it was presented in that application, but that he could have filed objector proceedings to prevent the deduction of 16% from the refunds due to him. His affidavit in protest was therefore ignored, and his advocate was sent out of court, in a manner quite similar to that in which the appellants’ advocates here were sidelined when they attempted to intervene in M/A 622/2010, albeit with no order as to costs against him.

For obvious reasons, URA did not seriously oppose M/A 376/2007 but only prayed for the protection of the court from queries that would arise from the Auditor General. She sought for orders as to whether and how she could pay the percentage fees, per agreement and so a charging order was entered, without much contest. In his ruling, the Learned Assistant Registrar found and held: -
 

The 2nd ground for the objection by the respondent relates to third party claims that may arise. As already noted this was a representative suit whereby a representative order was issued by this honourable court. The same was extensively advertised and court took extra care to ensure that interested members of the public knew what was going on. The remuneration agreement was registered properly in compliance with all the rule(s) and regulations and cannot be challenged. The court record is a public document accessible to all members and can be provided both in soft and hard copy. If the respondent seeks immunity from court I believe that is okay.

Under O 1 rule 8 (2) CPR any person on whose behalf or for whose benefit a suit is instituted or defended may apply to court to be made a party to that suit. The record clearly shows that no third party or member of the public applied to court to join the suit or withdraw from it.

No person after the adverts objected to the representative suit. Thus the respondent is well protected under the orders of this court appointing representatives and such third party claims which are inequitable cannot arise against the respondent.

Having considered the remuneration agreement the applicant is entitled to 16% of this amount from his clients which money is being held by the respondent. The said 16% would amount to Ushs 1,389,888,465/= (…in words…).

Under the provisions of s.61 Advocates Act the applicant is entitled to a charge on the above sum of Ushs. 1,389,888,465/= to which he is entitled out of the remuneration agreement from his clients and it is accordingly granted. I order that this amount be paid to the applicant immediately.      {My Emphasis}


Following this order, URA still refused to pay the amount of Ushs. 1,389,888,465/= claimed by the 3rd respondents here. URA then filed an appeal (M/A 393/2008) and an application for stay of execution (M/A 394/2010). Execution was stayed on 11/08/2008 by Arach-Amoko, J. (as she then was), and she ordered that URA deposit 10% of the fees claimed by the advocates within 10 days of the order; that was done by depositing shs. 138,988,846/= in court. Eventually, M/A 393/2008 (the appeal) was abandoned and therefore never heard. The 3rd respondent firm took out garnishee proceedings in M/A 397/2008 and an order nisi was granted on 30/07/2010.

It would appear that following these garnishee proceedings, the 3rd respondent firm received the whole of their alleged fees of shs. 1.3 billion, based on the fee agreement. It remains unclear how many of the 50,000 or so beneficiaries to that judgment were interested in the suit, or how many collected the licence fee refunds from URA. Suffice it to say that by the zeal that was displayed by the Advocates in that application, as is the case in M/A 622/2010 and this appeal; O.S. 10/2007 was filed and prosecuted by the 3rd respondent firm for the sole purpose and for the benefit of the advocates therein. It was filed to get the fees per agreement with the plaintiffs named in the suit, i.e. to share in the spoils of litigation, but not for the benefit of the numerous motor vehicle owners that were entitled to refunds of road licence fees wrongly collected by URA.

I hasten to point out here that I am not in agreement with the manner in which the recovery of the advocates’ fees in the road licence fee refund case was concluded under the provisions of s.61 of the Advocates Act. But the ruling and orders that were made therein remain on the record of this court, signifying that the position of the Assistant Registrar in that application is still the correct legal position on such agreements and applications under s.61 of the Advocates Act. That seems to have caused or influenced the 3rd respondents to behave in the manner that they did in the instant case. They had been led to believe that the order contested here could never be lawfully set aside. This appeal is meant to decide the very same question, and I will return to it later in this judgment.
 

Going back then to the instant case, the status quo here is that, as opposed to the road licence fee refund case where each party was ordered to pay its own costs, the judgment in O.S 009/2009 required URA to pay the costs of the suit, as is normally the case under s.27 CPA where a party loses a suit. It is my view that if URA then refused to comply with the order to pay the taxed costs, then the 3rd respondents would have had recourse to any of the modes of execution provided for by Order 22 of the CPR. But I highly doubt that URA could have refused or failed to comply with an order of this court to pay costs in a matter such as this one where there was no doubt that they lost the suit.

In conclusion, regarding the propriety of bringing the 3rd respondents’ application under s.61 of the Advocates Act, I have no alternative but to agree with Mr. Kibaya’s submission that the application for charging orders was not properly brought before court under s.61 of the Advocates Act, and that the resultant order of the Deputy Registrar was misconceived and/or illegal and therefore of no effect. I would then proceed to quash the charging orders and that would put an end to this matter. However, this appeal is of great public importance because it touches on the conduct of advocates, registrars and the court process as a whole. I will therefore go on to consider the other preliminary objections that were raised by the 1st and 3rd respondents in the appeal in order to establish whether, as they strenuously argued, the said objections could dispose of the whole appeal.

The 1st and 3rd respondents’ next objection was that the appeal was barred by s.5 and s.6 CPA. It was stated in their submissions that the matters in this appeal were exactly the same as those that were raised in M/A 625/2010, and that the appeal was filed when no decision had yet been made in M/A 625/2010. That as a result this appeal was one in which the matter in issue was also directly and substantially in issue in a previously instituted suit or proceeding between the same parties or between parties litigating under the same title, in a court in this jurisdiction.

I dealt with the same question in my ruling in M/A 646/2010. I observed that since the Learned Registrar had already found that the 3rd respondents’ remuneration agreement complied with all the requirements of the Advocates Act to do with such agreements, and that it ought to be enforced forthwith, by having URA pay over the legal fees claimed by the 3rd respondent here, it would have neither been rational, nor practical for the same judicial officer to come to the contrary finding in a subsequent application that the same agreement was illegal, null and void. In order to better elucidate my deicison in M/A 646/2010, I will reproduce the relevant parts of the Deputy Registrar’s decision in M/A 622/2010.
 

“From the above, it goes without saying that Rock Petroleum (U) Ltd directors pursuant to the court representative suit (I think order) to file a representative suit on its behalf and on behalf of numerous importers of diesel and petrol seeking refund of monies illegally collected by URA as excise duty referred to as “clients” entered into the remuneration agreement with the above terms duly notarised and copy sent to the Law Council. The terms therein (the applicable) already above captured are very explicit and binding on all beneficiaries in the representative suit, O.S. 09/2009.
 
The applicants’ first application prayer is that it is entitled to charge their legal fees on the Excise Duty refunds ordered by court in O.S 09/2009. I therefore do find that under s.61 of the Advocates Act, vide that agreement they are entitled to the charge in the agreed percentages and terms of the agreement.

I therefore do order that the agreed remuneration and legal fees against Rock Petroleum (U) Ltd and the other representees (sic) (all the applicants’ clients during O.S. 09/2009), be charged and wholly paid to the applicants, Muwema and Mugerwa Advocates out of the Excise Duty refunds for the diesel and petrol importers held by the respondent under orders of court in O.S 09/2009.

The agreement also squarely falls under the ambit of remuneration agreements of (sic) contentious business for gross sum envisaged in s.50 of the Act, and court finds no cause for its investigation under section 50 (3) of the Act at this time since the respondent is not a party thereto. While s.52 of the Act refers to certain circumstances where the taxing master may reduce the amount payable under the agreement when applied to by the person making payments within 12 months to reopen it, this is not this application’s ambit, for it is not what URA is seeking. Section 50 refers …”
                                                               {My Emphasis}

It is very clear from the extract above that the Registrar disposed of all the crucial questions in M/A 625/2010 in her findings and ruling above, save for the question whether the appellants could have been joined as parties to O.S 009/2009 after judgment was delivered. And with all due respect to the Learned Deputy Registrar, she acted as though her judicial mind had been split into two distinct parts. Though she was well aware that there was M/A 625/2010 challenging the validity of the same fee agreement, and which she had entertained immediately after M/A 622/2010 but deferred the ruling to be delivered on the same day as that in the latter application, she failed to do so. She instead preferred to issue the charging orders affirming the validity of the fee agreement in spite of the serious allegations raised by the appellants in M/A 625/2010 that the same was illegal and void. I will therefore waste no more time on that point of law here for it is also a substantive ground in this appeal.

Next was the objection that this court could not entertain new matters of law or fact on appeal that were not raised at first instance. Counsel for the 1st and 3rd respondents contended that the remedies that his clients sought in M/A 622/2010 were that the 3rd respondent’s fees be charged against the monies recovered in O.S. 009/2009, and that the 2nd respondent be ordered to pay their fees, per agreement out of the said refunds. Strangely, counsel argued that the issues raised in the present appeal were never raised in their M/A 622/2010, and that therefore, no decision was made on them. Counsel further argued that the Registrar did not have the power to entertain the said issues in M/A 622/2010 either. Counsel then went on to submit that the issues raised here were not raised by the appellants in M/A 622/2010 because they were not party thereto. Further, that the respondents here were never heard as regards the legality or validity of the remuneration agreement but they were only heard on the issue whether it was proper for the court to make an order charging their fees against the judgment debt based on the said fee agrement. Counsel for the appellants did not specifically reply to these arguments but I will address them basing my observations on the ruling in M/A 622/2010, and the record of proceedings in M/A 625/2010.

At the onset, it is important to note that this appeal is not only against the orders in M/A 622/2010. Though the appellants did not state it in the appeal, it was implied from the grounds that the appeal was also against the decision of the Registrar to deliver a ruling in M/A 622/2010, without first considering the complaints that were raised about the validity of the fee agreement in M/A 625/2010. The failure of counsel for the 1st and 3rd respondents to understand that aspect of the appeal no doubt led to their confusion about what the real substance of this appeal was. Similar to the learned registrar, their minds seem to have been split into two, so that they viewed the issues raised in M/A 622/2010 as completely separate and distinct from those that were raised in M/A 625/2010.

Simply put, the appellant’s grievance here is that though they filed M/A 625/2010 in which they challenged the validity of the 3rd respondents’ fee agreement with the 1st respondent and its enforceability against them, the Learned Registrar chose to declare that the same agreement was legal and valid and should be enforced against them. Their only desire in this appeal was to have a decision on the questions about the validity or legitimacy of the 3rd respondents’ fee agreement which they raised in M/A 625/2010, before the charging orders based on the same agreement could be enforced against them. And as I have already ruled while dealing with the 1st and 2nd preliminary points of law, that is their legal and constitutional right which cannot be ignored by a court of justice. But it is still pertinent to deal with the complaint raised about bringing on board new issues at an appellate level.

I think the question at the bar was succinctly decided by the Supreme Court in Christine Bitarabeho v. Edward Kakonge, Civil Appeal No. 4 of 2000, when the court observed as follows:-
 

“One common issue considered in all the three cases is whether, on appeal, a party can be permitted to raise a matter which it did not raise in the trial court. What Lord Buckmaster said in North Staffordshire Railway Co. -vs- Edge (supra) at page 270, comes out with a very clear answer to that issue, which I find is of great persuasive value, and is applicable to the instant case. He said:
"Upon the question as to whether appellants should be permitted to raise here a contention not raised in the court of first instance I find myself most closely in accordance with the views just stated by Lord Atkinson. Such a matter is not to be determined by mere consideration of the convenience of this House, but by considering whether it is possible to be assured that full justice can be done to the parties by permitting new points of controversy to be discussed. If there be further matters of fact that could possibly and properly influence the judgment to be formed, and one party has omitted to take steps to place such matters before the court because the defined issues did not render it material, leave to raise a new issue dependent on such facts at a later stage ought to be refused, and this is settled practice."

The court went on to quote the decision of Berko, JA., who wrote the lead judgment in the Court of Appeal where he concluded with the finding that follows below, and with which the Justices of the Supreme Court were in complete agreement that:-
 
“A new point raised for the first time in a court of last resort ought not to be entertained unless the court is satisfied that the evidence upon which they are asked to decide establishes beyond doubt that the facts, if fully investigated, would have supported the new plea. In the present case, I am far from satisfied that this court has before it all the facts bearing on the question of law now raised for the first time, which might have been elicited in the lower court had the matter been there in issue.”

The court therefore did not consider the new matter raised on appeal in that case because no evidence had been taken on the issue in the court below. But in the instant case, I do appreciate the fact that the issues being raised in this appeal appear to be new with regard to the contest of the decision in M/A 622/2010; but they are only new in as far as the terms used are different. The question of the legality or otherwise of the fee agreement was, without a doubt, determined by the Registrar when she ruled that the contested agreement complied with all the relevant requirements of the Advocates Act and the Regulations thereunder. Therefore, to argue that the issue of illegality of that agreement is a new matter in as far as M/A 622/2010 is concerned is simply a matter of semantics. Suffice it to say that the issue of the legality and binding force of the same agreement was the whole purpose of M/A 625/2010 which the appellants complain was overtaken by events when the Registrar decided to render her decision in M/A 622/2010, without pronouncing herself on the complaints about the same agreement raised in M/A 625/2010.

There is also no doubt in my mind that there is sufficient evidence on record to decide the alleged new issues in this appeal which all hinge on the legality of the terms in the fee agreement that I have laid out above, and the conduct of the 3rd respondents when they had it drawn and executed, i.e. its date vis-

-vis that of filing O.S 009/2009. In addition, the issues that were raised about the agreement are purely issues of law. If the agreement is already before this court in evidence, as it was in M/A 622/2010 and M/A 625/2010, then the court is seized with sufficient evidence to evaluate it in order to establish its validity and enforceability or otherwise. I am fortified in coming to that conclusion by the decision of the Court of Appeal for Eastern Africa in the case of Ngakwila v. Lalani [1972] 1 EA 382, where it was held that:
 

“In the High Court, the question of the illegality of the contract was never raised nor was it included in the grounds of appeal before us. However, as this is a question of law we would have had to consider it any way even if it was not raised by the parties – see Harnam Singh v. Sadhu Singh Dhiman (1951), 18 E.A.C.A. 75.”
 
And in the event that the alleged illegality of the agreement in issue had never been brought to the attention of the court before, in Harnam Singh v. Sadhu Singh Dhiman (supra) the Court of Appeal for Eastern Africa observed that the principle that the courts follow in such cases is set out in paragraph 209 of the Halisham Edition of Halsbury’s Laws of England, Vol VII at page 148, as follows:

“If the illegality of a transaction is brought to the notice of the Court, whether the contract ex facie shows illegality, as it appears in the course of the proceedings, and the person invoking the aid of court is implicated in the illegality, the court will not assist him, even if the defendant has not pleaded the illegality and does not raise the objection.”
 
The court then went on to observe and hold that when an action is brought on the basis of a contract and the point is not taken by the defendant that the contract is illegal, the court will itself in a proper case intervene and refuse to enforce the contract, yet this does not relieve the defendant of the necessity for pleading illegality when the issue is raised plainly by the facts alleged in his defence. Further that the issue is not always a simple one and it should be raised at the earliest possible stage of the proceedings to give fair notice to the other party and to the court. Failure to do so, while not preventing the intervention of the court, may result in the defendant being deprived of his costs. Sir Newnman Worley, VP, went on to state as follows:
 
“The second observation that I have to make is that, though it is the right and the duty of the court to consider illegality at any stage yet, when it has not been pleaded and not raised in the court below or, at best, only raised at a late stage, the appellate court ought to be cautious and must consider whether the alleged illegality is sufficiently proved and must be satisfied that if there are matters of suspicion in the plaintiff’s case, an opportunity was given for explanation and defence.”

In view of the decision above, the case now at the bar satisfies all the conditions required to enable the appellant’s here raise the alleged illegality on appeal. The appellants tried to intervene at the point when they discovered that M/A 622/2010 had been filed in court by filing their M/A 625/2010. In addition to that, when M/A 622/2010 was called on for hearing on 8/11/2010, the appellants’ advocates, Mr. Tumusiime, Mr. Barata and Mr. Kibaya were in court and did tell the Registrar that their clients had an interest in the application before her. She then put them on record as “officers of court in attendance.” After that, counsel for URA, Mr. Moses Kazibwe made an attempt to apply for an adjournment in order to file an affidavit in rejoinder to the application. He also in no uncertain terms brought it to the attention of the Registrar that the appellants’ application (M/A 625/2010) was about the same matter as that in M/A 622/2010, as follows: -
 
“I have also learnt from the officers of court as listed that they have before this court an application regarding the same matter before you; application 625/2010, which is yet to be fixed for hearing.

Our contention as respondents are (sic) that the issues in that application are similar to the matter before you and it would be in the interest of all parties to have the matter amalgamated so that all the matters to do with all issues arising from that application are handled once for all.

This will safeguard now the respondent not to be brought to court all the time by the numerous claimants regarding the same matter.

(Court goes into recess because the parties are loudly exchanging, for 30 minutes).”


After that short adjournment, Mr. Kazibwe abandoned his quest to file an affidavit in rejoinder. The appellant’s advocates also did not pursue the application to have the two applications consolidated. Neither did the learned Registrar demonstrate that she considered the application for consolidation, judicially, in spite of her obligations under the provisions of Order 11 rule 1 CPR.

Order 11 rule 1 CPR empowers the court either of its own motion or on the application of a party to consolidate suits pending before the same court in which the same or similar questions of law or fact are involved. Though no ruling or comments were made about the application to consolidate, it is my view that a careful judicial officer would have taken time to ponder whether the two applications had similarities that required them to be consolidated before going forward with either of them. Instead, it appears that the learned Registrar decided to entertain the applications one after the other, first M/A 622/2010, probably because it was filed before M/A 625/2010, then later in the day and the following day (9/11/2010) she entertained M/A 625/2010.

It is pertinent to point out here that the duty to control proceedings before it is vested in the court. It is the duty of the judicial officer to identify the crucial issues for trial in each case, and to see to it that they are tried expeditiously and as inexpensively as possible. The advisors of the parties only assist the judicial officer in carrying out that duty (Ashmore v. Corporation of Lloyd’s [1992] All E.R. 486 at 448). It is therefore my opinion that a judicial officer who remains passive and leaves the management of the cases before his/her court and the making of important decisions, such as whether to consolidate suits and applications or not, to the advocates appearing before him/her abdicates his/her principle duty in the proceedings. In the instant case, the failure to make the decision to consilidate the two applications, though discretionary, resulted in an injustice and contributed to the escalation of the dispute over the fee agreement. I therefore find that the Deputy Registrar erred when she failed to come to a decision on the issues of illegality raised in M/A 625/2010 before she issued charging orders in favour of the 3rd respondents in M/A 622/2010.

There is therefore no doubt in my mind that in this case the appellants brought it to the attention of the court, and to the 1st and 3rd respondents that they would be raising the issue of illegality over the fee agreement, at the earliest possible time. I have therefore cautioned myself, considered and found that there is sufficient evidence to be evaluated with regard to the alleged illegality, and that the 1st and 3rd respondents were given time within which to file affidavits in reply in M/A 625/2010, to appear at the hearing thereof, and therefore an opportunity for explanation and defence (Harnam Singh v. Sadhu Singh Dhiman). But unfortunately, the Registrar decided to reserve her ruling on the issues of illegality that were raised in M/A 625/2010 and then decided that the agreement was legal, so making M/A 625/2010 lose all meaning. It is therefore correct for the appellants to raise the issues of illegality again here in a combined appeal against the decision in M/A 622/2010 and the aborted M/A 625/2010. As the 1st appellate court therefore, I have an obligation, indeed a duty, to consider the issues of illegality raised before the Registrar in the aborted application in this appeal.

I was therefore not persuaded by the submission by counsel for the 1st and 3rd respondents, in rejoinder to that of Mr. Kibaya’s regarding the decision in Makula International Ltd. v. His Eminence Cardinal Nsubuga & Another [1982] HCB 11, that the court cannot sanction what is illegal and illegality once brought to the attention of court overrides all questions of pleading, including any admissions made thereon, “no longer represents the forward thinking of the court.” The question of the jurisdiction of this court as an appellate court in this matter, in relation to which the erroneous and misconceived submission was made, has been given adequate treatment above and need not be brought up again in this connexion. I therefore find that the decision in Makula International has been good law since the common law was received in this jurisdiction. It continues to be good law because of decisions similar to that in Beatrice Busingye v. Fiona & George Nyakana, SCCA No. 5 of 2004, cited by Mr. Kibaya, and many others after it. It is therefore becasue of that oft cited ratio in the Makula International case that I will entertain the appeal now before court.

The final preliminary objection was that the appellants here had no cause of action against the 1st respondent because she was not a party to M/A 622/2010. That the charging orders were not made for or against the 1st respondent so no cause of action could arise against her. In reply, Mr. Kibaya submitted that the 1st respondent was a necessary party because in M/A 625/2010, Mr. Dokoria, one of her directors, swore an affidavit dated 8/11/2010 in which he stated that the 3rd appellant’s M.D, Mr. Aloke Kumar Dandapat had disassociated Gapco (U) Ltd from participating in this appeal, claiming that the advocates for the appellants did not have her instructions to contest the fee agreement. The letter alleged to have communicated this position to the appellant’s advocates was dated 5/11/2010, and attached to Mr. Dokoria’s affidavit. That since then, Mr. Kumar had deposed an affidavit in rejoinder denying the said allegations and stating that the letter annexed to Allan Dokoria’s affidavit was a forged document.

Mr. Kibaya then went on to submit that there was an attempt by the 1st respondent to pervert the course of justice by tendering a forged instrument in court and that for that she ought to be a party to the appeal. That in addition, it was the 1st respondent that purported to execute the impugned agreement, on behalf of all the diesel and petroleum suppliers in Uganda, to pay the 3rd respondents’ fees out of the monies recovered in the suit.

There is no doubt from the agreement that it was executed by the 1st respondent on behalf of all the petroleum and diesel suppliers in Uganda. For this court to determine the question whether 1st respondent had the capacity to do so or not, the 1st respondent had to be made a party to M/A 625/2010 so that her rights to do so, or not are established. The 1st respondent also had to clarify why she did enter into such an agreement, which she tried to do in Mr. Dokoria’s affidavit in reply to M/A 625/2010. And I as pointed out above, this appeal is in reality against the decision in M/A 622/2010, and the absence of a substantive decision in M/A 625/2010. The question still has to be decided in this appeal how far the powers of a representative who is appointed by court to file a class action go, and it is the 1st respondent that stands in that position. Since the 1st respondent was a party to M/A 625/2010, she is still a necessary and proper party to this appeal, and I find so.

In conclusion, the preliminary points of law raised by counsel for the 1st and 3rd respondents were only diversionary. I believe they were meant to either delay the hearing of the substantive appeal or to prevent it. However, it is still the law in this jurisdiction that a court cannot sanction what is illegal and illegality once brought to the attention of the court, overrides all questions of pleadings, including any admissions made thereon.

Therefore, it matters not whether the investigation of the propriety of the fee agreement contested here came to court by way of s. 50 (3) of the Advocates Act or some other provision of the law (See Saggu v. Roadmaster Cycles (U) Ltd. (supra), and Article 126 (2) (e) of the Constitution of Uganda). Since jurisdiction to open up fee agreements is provided for in s.50 (3) of the Advocates Act, and it is done on the application of any person who is a party to the agreement, or who is, or who is alleged to be liable to pay, or who claims to be entitled to be paid, the costs due or alleged to be due in respect of the business to which the agreement relates, it can be opened up, even on appeal under s.62 Advocates Act. And on doing so the court may enforce or set aside the agreement and determine every question as to the validity or effect of the agreement. The preliminary objections raised by the 1st and 3rd respondents therefore all fail, and they are overruled with costs to the appellants. I will now proceed to consider the appeal on its merits.

In his submissions in support of the appeal, Mr. Tumusiime raised three general questions for the court to decide as follows: -

1.      

Whether the fee agreement between the 1st respondent and the 3rd respondent firm is legal;
2.       Whether the said agreement is enforceable against the appellants;
3.       Whether there are any remedies available to the appellants.
 
Mr. Tumusiime addressed all the three questions or grounds together. He began by setting out the historical background to s. 55 (1) (b) of the Advocates Act as having its genesis in the offences or torts of champerty and maintenance which were frowned upon by the common law. He submitted that with the coming into force of the Advocates Act, special provisions were incorporated in it to provide for a few exceptions that an advocate could meet in order to enter into a fee agreement with a client for the provision of legal services. He referred me to s.51 Advocates Act which sets out the special requirements for such agreements.

Mr. Tumusiime went on to submit that by virtue of s.51 (1) (a) of the Act, such agreements have to be in writing, a provision that is similar to s.2 of the Contract Act. Further that by virtue of s.3 of the Contract Act, certain agreements have got to be in writing and signed by the party to be charged. He further submitted that by virtue of s.51 (1) (c) of the Advocates Act, an agreement for remuneration of an advocate should be notarised and that the client is bound to explain to the Notary Public that he/she understands the terms set out therein. Mr. Tumusiime then charged that the 1st and 3rd respondents presented an agreement to court which was not signed by any of the appellants. That as a result, the appellants could not be bound by it. He added that the certificate of the Notary Public on the contested fee agreement did not indicate that any of the appellants appeared before her to state that they understood the terms of the agreement; that neither did any of the other parties to O.S. 009/2009 do so, save for the 1st respondent.

Mr. Tumusiime next addressed court on the provisions of s.51 (2) of the Advocates Act. He submitted that by virtue of that provision, an agreement of the nature presented by the 3rd respondent was not binding against the appellants or any of the other plaintiffs in O.S. 009/2009, not even the 1st respondent. He went on to submit that s.55 (1) (b) of the Advocates Act provides that no agreement for the payment of fees to an advocate shall be valid if it specifies for payment only in the event of success of the suit. He referred to clause 2 of the impugned agreement as being such a provision and submitted that it was on all fours with what is prohibited by s.55 (1) (b) of the Act. He then concluded that for those reasons also, the fee agreement was invalid, even as between the 1st and 3rd respondents; and emphasised that it could not even bind the 1st respondent.

Mr. Tumusiime also drew court’s attention to the provisions of rule 26 of the Advocates (Professional Conduct) Regulations, SI 267/2, which is about contingent fees. The provision states that an advocate shall not enter into any agreement for the sharing of a proportion of the proceeds of a judgment whether by way of percentage or otherwise. He emphasised that rule 26 of the Regulations is couched using the expression “shall,” and that therefore it is mandatory. He then submitted that the 3rd respondents’ agreement was definitely illegal because sharing in the proceeds of a judgment by an advocate is prohibited by law. He referred me to the decisions in Mkono & Co. Advocates v. J. W. Ladwar (1977) Ltd. [2002]1 EA 145, and Active Automobile Spares v. Crane Bank & Another, SCCA No. 21 of 2001.

He took the argument further by submitting that in instances where an advocate enters into an illegal agreement, the court would not be in a position to assist him/her to enforce it because of the principle ex turpi causa non oritur actio. He cited the decision in Pandit v. Willy Sekatawa [1964]1 EA 490 for the submission that for an agreement to bind a client he/she must have signed it. He relied on the decision in Makula International v. Cardinal Nsubuga (supra) for the submission that even where an appeal was said to be incompetent the Court of Appeal interfered with the orders of a Taxing Officer because of an apparent illegality.

Mr. Tumusiime went on to submit that where an advocate enters into an agreement contrary to s.51 (1) and (2) and s. 55 (1) (b) Advocates Act, as well as rule 26 of the Advocates (Professional Conduct) Regulations, the agreement is illegal and unenforceable. And that under s.69 of the Advocates Act, the 3rd respondent firm was not entitled to any costs at all for the suit because they engaged in professional misconduct. He then prayed that for the reasons advanced above, the order of the Registrar in M/A 622/2010 be set aside.

Mr. Tumusiime finally drew court’s attention to the provisions of Reg. 9 of the Advocates (Professional Conduct) Regulations which prohibits advocates from appearing in cases in which they may be required to appear as witnesses. He argued that the 3rd respondent firm was barred from representing the 1st respondent in this appeal because the 3rd respondents were litigants in it, and were likely to become witnesses in the matter. He submitted that for that reason, the 3rd respondents should not have purported to represent the 1st respondent in the appeal, in the first place. He then prayed that the appeal be allowed with costs and a certificate for three advocates be issued in this appeal, as well as in M/A 622/2010 and M/A 625/2010.

In reply, counsel for the 1st and 3rd respondents filed written submissions in court on 14/12/2010. In their written arguments, M/s KSMO Advocates put up a spirited fight to uphold the decision of the Deputy Registrar that the fee agreement between the 1st and 3rd respondents was legal and therefore enforceable against the appellants. With regard to the provisions of s. 55(1) (b) Advocates Act and rule 26 of the Advocates (Professional Conduct) Regulations, counsel attempted to distinguish the facts in the case of Mkono & Co. Advocates v. J. W. Ladwar (supra) from those in the instant case. He argued that while the advocates in the Mkono case did not file a suit and the matter was therefore not contentious, the advocates in the instant case filed a suit, argued it and were successful.

Counsel for the 1st and 3rd respondents went on to argue that the case of Active Automobile Spares Ltd. v. Crane Bank Ltd (supra), also cited by counsel for the appellants, could be applied to the instant case in such a manner that since the appellants sought to challenge the legality and validity of the fee agreement, which was the basis upon which the 3rd respondents carried out the 1st respondent’s instructions, they were in effect attacking the very foundation of the 3rd respondent’s instructions. It was therefore the opinion of counsel for the 1st and 3rd respondents that if the ratio in that case was applied to the facts of this case, the result would be that the appellants also would not be able to recover the fruits of the judgment in O.S 009/2009. In his opinion, that would be equivalent to saying that the very instructions that were given to the 3rd respondent to prosecute the suit were illegal; that as a result the appellants would then also be implicated in the illegality and therefore be ineligible for the assistance of this court.

The other limb of counsel for the 1st and 3rd respondents’ argument was that the 1st respondent signed the fee agreement in his capacity as a representative appointed by this court to file a representative suit on behalf of the 1st respondent, the appellants here and the other petroleum product suppliers in Uganda. Further that the appellants were trying to take away the very basis upon which the suit was filed, meaning that the 3rd respondent did not have the authority to file the suit and obtain judgment. Counsel again advanced the novel argument that in the circumstances the appellants could not be assisted by this court to enforce the judgment and recover the excise duty refunds due to them.

Counsel for the 1st and 3rd respondent went on to submit that the Advocates Act is very liberal when it comes to the protection of Advocates fees and that the Act only denies them recovery of the same when it is proved that the advocates were involved in fraud. Counsel went on to argue that such was the reason why the only instance in which an advocate could be struck off the roll was in instances when fraud is proved against him/her.

In further argument, counsel for the 1st and 3rd respondents called upon this court to investigate the mischief that the legislature intended to remedy (by enacting s. 55 (1) (b) of the Advocates Act) and then construe the legislation so as to elicit that purpose. Counsel then referred to the discussion of the tort of champerty in the Mkono case and submitted that it had not been proved in this case that the agreement in dispute led the advocates in the 3rd respondent firm to get tempted, for their own personal gain, to inflame damages, suppress evidence or even to suborn witnesses (Re Trepca Mines Ltd. [1963] 3 All ER 351). Counsel took the argument further by submitting that no allegations had been made against the 3rd respondents that they had not conducted their clients’ case with scrupulous fairness and integrity, nor had a charge been levied against them that they tried to inflame damages.

It was also the view of counsel for the 1st and 3rd respondents that the 3rd respondent had prosecuted the suit with competence and diligence. That the only crime that the 3rd respondents committed was to make an agreement stipulating that they would be remunerated from the proceeds of the case without showing any deceit, unfair advantage or dishonesty on their part. It was therefore the view of counsel for the 3rd respondents that the mischief envisaged by s.55 (1) (b) Advocates Act, and Reg. 26 of the Rules was non existent, and that therefore, there was no need to remedy it in the instant case.

In an interesting turn of his arguments, counsel for the 1st and 3rd respondents had the audacity to argue that if any finding was made by this court that the 3rd respondent firm was engaged in the mischief that was intended to be cured by s.55 (1) Advocates Act and rule 26 of the Advocates (Professional Conduct) Regulations, then the court would be “creating another mischief” if it ordered that the 3rd respondent firm be deprived of its fees, per agreement. Counsel then took the argument further by contending that it was not the intention of the legislature to deprive advocates of their fees in cases such as this one where no dishonest dealing was proved against them, except perhaps an innocent mistake or carelessness in drafting a contingent remuneration agreement,” without the slightest intention of cheating or defrauding their clients. He then concluded that it would be “a grave injustice” for this court to hold that the agreement is illegal, so as to deprive the 3rd respondents of their fees in what was a novel and complex case, concluded in the same court where the beneficiaries of the judgment are now enjoying the fruits of it.
 

As to whether the contested fee agreement is binding on the appellants, counsel for the 1st and 3rd respondents argued that it was because it was executed by the 1st respondent who had in his favour a court order to prosecute the suit in a representative capacity. Further that the suit was “a representative suit” and not “an individual suit.” That all the beneficiaries to the judgment in O.S 009/2009 were clients of the 3rd respondent firm because the word “client” is defined in s. 1 (b) of the Advocates Act to include any person who, as a principal or on behalf of another, or as a trustee or personal representative, or in any other capacity, has power, express or implied, to retain or employ, and retains or employs, or is about to retain or employ, an advocate and any person who is or may be liable to pay to an advocate any costs. Counsel further argued that s. 23 of the Interpretation Act applied to define the powers of a representative for purposes of bringing a representative suit. He then concluded with the argument that the submission that the appellants were not party to the agreement between the 1st and 3rd respondent because they did not sign it was misconceived.

In view of the arguments raised by counsel for all parties hereto, I deduced that the specific questions that needed to be answered in this appeal were as follows:-

i)      

Whether the impugned fee agreement contravened the provisions of ss 2 and 3 of the Contract Act, s.50 (1) and s. 51(1) of the Advocates Act.
ii)      Whether the fee agreement contravened the provisions of s.55 (1) (b) of the Advocates Act and rule 26 of the Advocates (Professional Conduct) Regulations.
iii)     Whether the 3rd respondents filed O.S 009/2009 for their own gain; did they have the intention of sharing in the spoils of the litigation?
iv)     
Whether it was reasonable of the 3rd respondents to charge up to 20% of the judgment debt as their fees and if not, whether the fee agreement was extortionate and/or unconscionable?
v)      
Whether the 3rd respondents engaged in conduct that could be construed as part of the mischief that was intended to be cured by the prohibition of champerty and maintenance.
vi)     
Whether the 3rd respondents were guilty of any other dishonest dealing or misconduct in these proceedings.
vii)    
Whether the 3rd respondents could recover their fees per agreement through court, as they purported to do.
viii)   
What is the position of the 1st respondent in the whole case; was she equally liable for the misdeed of her advocates?
ix)     
Whether the appellants were in pari delicto with the 3rd respondents and therefore disentitled from benefiting from the judgment?
x)      
Whether the appellants were the 3rd respondents’ clients; and whether they were liable to pay the 3rd respondents’ fees, per agreement with the 1st respondent.
xi)     
Remedies.
I will now proceed to address the questions as I have framed them above.

i)      

Whether the impugned fee agreement contravened the provisions of ss 2 and 3 of the Contract Act, and s. 51(1) of the Advocates Act.
Perusal of the agreement showed that the same was executed by Mr. Fred Muwema for the 3rd respondent, and Fred Nyapidi and Allan Papaok Dokoria, directors of the 1st respondent company. It was with regard to the 1st respondent’s directors that the Notary Public certified that she had explained the contents of the agreement to them and they appeared to have understood its contents. However, s.51 (1) (c) of the Advocates Act provides that such agreements are to contain a certificate signed by a notary public (other than a notary public who is a party to the agreement) to the effect that the person bound by the agreement had explained to him or her the nature of the agreement and appeared to understand the agreement.

I therefore concluded that in this case, it was not the two directors of Rock Petroleum (U) Ltd. that explained the contents of the agreement to the Notary Public as was required by law, but on the contrary it was the Notary Public that explained the contents to them. This was in contravention of the provisions of s.51 (1) (c) of the Advocates Act and for that reason the agreement could not bind Rock Petroleum (U) Ltd. even though her directors signed it. In addition to that, the representatives of the appellants here did not sign the agreement. Neither did they appear before the Notary Public for her to take the necessary certificate from them. The appellants therefore could not be bound by an agreement that they did not sign and that was contrary to the general principles of the common law of contract which are contained in ss.2 and 3 of the Contract Act.
 

Regarding the Registrar’s finding that the fee agreement complied with all the provisions of s.51 of the Advocates Act, I would say that it complied with a few of the formal requirements that are provided for in that provision, such as signing by some of the parties, being in writing and deposited with the Secretary of the Law Council, but not all of them. I hasten to add that there is need to review the procedure whereby fee agreements are deposited with the Law Council because it seems there is no mechanism available for reviewing them by a competent person who would be able to determine whether the fee agreements comply with the provisions of the Advocates Act or not. However, agreements are received and stamped for the Council, in effect giving them the formal trappings of legality which advocates later rely on to claim that they are legal and binding. That system needs to be strengthened in order to protect the general public against unscrupulous advocates.

In addition to the above, although counsel for the appellants did not address court on that particular point of law, s. 50 (1) of the Advocates Act under which the fee agreement was said to have been drawn provides as follows:
 

“(1) Notwithstanding any rules for the time being in force, an advocate may make an agreement with his or her client as to his or her remuneration in respect of any contentious business done or to be done by him or her providing that he or she shall be remunerated either by a gross sum or by salary.”
                                                               {My Emphasis}

In that regard, the Deputy Registrar found and held at page 14, lines 16-20 of her ruling, that the fee agreement fell within the ambit of remuneration agreements for contentious business for gross sums envisaged by s. 50 of the Advocates Act, and she found no reason to investigate it under the provisions of s.50(3) of the Act. I hold a contrary view to the finding of the Registrar on that point. The provision that provided for the remuneration of the 3rd respondent in the contested agreement was not for a gross sum or salary. Clause 1 thereof provided for “an additional fee which is equivalent to 16% of the total proceeds of the clients’ claims …” I hold the firm view that a salary is hardly, if ever, expressed as a percentage of any sum. If that is done, the compensation becomes a commission. There is also no dount that a percentage of an unascertained amount cannot be a gross sum.

Now s. 50(1) of the Advocates Act which provides for agreements for fees in contentious matters is clearly different from s.48 of the Act which provides for agreements in respect of non contentious business.
 

“(2) The agreement may provide for the remuneration of the advocate by a gross sum, or by commission or percentage, or by salary or otherwise, and it may be made on the terms that the amount of the remuneration stipulated in the agreement for either shall or shall not include all or any disbursements made by the advocate in respect of searches, plans, travelling, stamps, fees or other matters.”                                                                                       {My Emphasis}
                                                              
Comparison of the two provisions led me to the conclusion that for a reason that I am yet to firmly established, it was never the intention of the legislature to provide for remuneration of advocates in contentious matters by payment of commissions or percentages. What was preferred was remuneration by gross sum or salary. The rational for the difference in the two scenarios above may be similar to the mischief that the legislature intended to cure by prohibiting champerty and maintenance; i.e. that an advocate in contentious proceedings who is promised a fee on the basis of a commission or percetage fee may be tempted to inflame damages so as to get a higher commission or percentage on the successful completion of the suit. I therefore find that for that reason, the fee agreement between the 1st and 3rd respondents not only contravened the provisions of s. 51 (1) of the Advocates Act, but it also contravened the provisions of s. 50 (1) thereof by providing for remuneration for contentious business by way of a percentage or commission.

ii)     
Whether the fee agreement contravened the provisions of s.55 (1) (b) of the Advocates Act and rule 26 of the Advocates (Professional Conduct) Regulations.
Section 55 (1) (b) of the Advocates Act provides that nothing in section 50, 51, 52, 53 or 54 shall give validity to any agreement by which an advocate retained or employed to prosecute any suit or other contentious proceeding stipulates for payment only in the event of success of that suit or proceeding. The origins of s.55 (1) (b) of the Act are to be found in the common law doctrines of maintenance and champerty.
 
“Maintenance” may be defined as the rendering by one person, improperly, of assistance to another in prosecuting or defending proceedings in which the person so rendering assistance has no legitimate interest {Oliver LJ. in Trendtex Trading Corp v. Cr

dit Suisse [1980] 3 All ER 721, at 749}. It is "A taking in hand, a bearing up or upholding of quarrels or sides, to the disturbance of the common right (Curzon Dictionary of Law). Champerty is merely an aggravated form of maintenance and is constituted by an agreement between the maintainer and the maintained for the division of the proceeds of the suit (Trendtex Trading Corp v. Cr

dit Suisse, supra). Among laypersons, this is known as “buying into someone else's lawsuit.” (See also Giles v Thompsonhyperlink [1993] 3 All ER 321, at 329). Champerty has also been descibed as “sharing in or dividing the spoils of litigation.”


At common law, maintenance and champerty were both hyperlink and hyperlink, as was hyperlink, the bringing of hyperlink. This is generally no longer so as during the nineteenth century, the development of hyperlink tended to obviate the risks to the public. However, the principles are relevant to modern hyperlink agreements between a hyperlink and a client and to the hyperlink by a hyperlink of his rights in a lawsuit to someone with no connection to the case. Champertous contracts can still, depending on jurisdiction, be hyperlink for hyperlink or attract hyperlink for hyperlink.
 
In Quayum & Six Others v. Hexagon Trust Company (Cayman Islands) Limited, [2002] CILR 161, a decision which I found to be compelling, Smellie, C.J. had occasion to consider the public policy considerations of the doctrines of champerty and maintenance. He relied on the decision of Lord Esher M.R., in Pittman v. Prudential Deposit Bank Ltd. (
1896) 13 TLR 110, where the Master of the Rolls observed that “in order to preserve the honour and honesty of the profession it was a rule of law which the court had laid down and would always insist upon that a solicitor could not make an arrangement of any kind with his client during the litigation he was conducting so as to give him any advantage in respect of the result of that litigation.” He went on to point out that the raison d’

tre is the public policy interest in the preservation of the integrity of the legal profession and of the conduct of litigation. So much so that public policy had received recognition in the enactment in the Solicitors Acts and Rules of practice in England, which have their equivalents in Uganda.
 

Smellie, CJ, went on to observe that the nature of the public policy question could be broken down further into two: First, in litigation a professional lawyer’s role is to advise his client with a clear eye and an unbiased judgment. Secondly, a solicitor retained to conduct litigation is not merely the agent and adviser to his client, but also an officer of the court with a duty to the court to ensure that his client’s case, which he must, of course, present and conduct with the utmost care of his client’s interests, is also presented and conducted with scrupulous fairness and integrity. A barrister owes similar obligations. A legal adviser who acquires a personal financial interest in the outcome of the litigation may obviously find himself in a situation in which that interest conflicts with those obligations. In our jurisdiction where there is no division between solicitors and barristers, the Advocate owes similar obligations.
 
Similarly, in Re Trepca Mines Ltd. (supra) Lord Denning had opined that the reason why the common law condemns champerty is because of the abuses to which it may give rise. The common law fears that the champertous maintainer might be tempted, for his own personal gain, to inflame the damages, to suppress evidence, or even to suborn witnesses. He added that such fears may be exaggerated; but, be that so or not, the law for centuries has declared champerty to be unlawful, and where it is prohibited, we cannot do otherwise than enforce the law.
 
In addition to the provisions of s. 55 (1) (b) of the Advocates Act, in this jurisdiction rule 26 of the Advocates (Professional Conduct) Regulations specifically prohibits both champerty and maintenance and I will reproduce the provision for strength of effect.

 

“26. Contingent fees.

An advocate shall not enter into any agreement for the sharing of a proportion of the proceeds of a judgment whether by way of percentage or otherwise either as—
a)      

part of or the entire amount of his or her professional fees; or
b)      

in consideration of advancing to a client funds for disbursements.”
 
Elsewhere in the laws of Uganda, the Contract Act (2010) which is yet to come into force, proposes to make specific provision for contingent contracts in Part IV thereof. However, it does not propose to amend s.55 (1) (b) of the Advocates Act. It is therefore the case in this jurisdiction that contingent fee agreements for advocates’ specifying payment only in the event of success in contentious matters will remain illegal for a long time to come. For emphasis, the agreement in contention in this appeal had the following provisions:-

2.      

“The subject matter is involving, big and complex and the Advocates have agreed with the clients for a negotiated fee over and above what is provided for in the Advocates Remuneration Rules.

3.      
Further in consideration of the Advocates meeting all necessary statutory and contingency expenses required to pursue the matter.
 
(NOW) THIS DEED WITNESSES AS FOLLOWS:
1.      
The Advocates shall be entitled to costs of the suit and an additional fee which is equivalent to 16% of the total proceeds of the clients’ claims or whatever total sum of the claim that the Court shall finally award or declare to be due to the clients.”
 
The provisions reproduced above not only provided that M/s Muwema & Mugerwa, Advocates would maintain the suit, i.e. pay all fees for it, but also that on obtaining judgment, they would be paid the costs of the suit and an additional fee equal to 16% of the proceeds of the claim. There is therefore no doubt that the agreement contravened s.55 (1) (b) Advocates Act and rule 26 of the Advocates (Professional Conduct) Regulations. The fee agreement was definitely illegal and therefore void ab initio.

iii)    

Whether the 3rd respondents filed the suit for their own gain; did they have the intention of sharing in the spoils of litigation?
O.S 009/2009 was filed on the 1/09/2009. The fee agreement in contention was also entered into on the same day and the 3rd respondent firm derived their mandate to file the suit from the said agreement. The advocates that the 3rd respondents retained to file submissions in reply on their behalf in the appeal admitted this fact when they stated at page 4 of their written arguments as follows:-
 
“In other words, the agreement is the basis upon which the third respondent was instructed to file the representative suit, argue it and obtain judgment. The fact is not contested by the appellants but what is contested (conveniently in our view) is the issue of the Advocates’ fees.

The problem is that by declaring the agreement to be allegedly illegal, the Appellants are taking away the very basis by which the Third Respondent gained instruction to pursue the suit and earn fees.”

 
No clearer admission could have been made by a champertous maintainer than the statement above. Counsel for the 3rd respondent submitted in no uncertain terms that the filing of the suit was a champertous adventure in which they sought to recover their fees, no more, no less. It is therefore also not surprising that the person who instructed them to file the suit was little known Rock Petroleum (U) Ltd., whose claim of the stake was shs. 3,350,580/=only. The plaintiff also appears to have been an adventurer in the courts!

iv)     
Whether it was reasonable of the 3rd respondents to charge up to 20% of the judgment debt as their fees; and if not, whether the fee agreement was extortionate and/or unconscionable?
The 3rd respondents agreed to maintain the suit, albeit illegally, in the following terms stated in clause 3 of the preamble to the fee agreement as follows:-

“Further in consideration of the Advocates meeting all necessary statutory and contingency expenses required to pursue the matter.”

And in consideration of that, the 3rd respondents would be entitled to 16% of the proceeds of the judgment in addition to their taxed costs. But they did not disclose to their client the amount of statutory and contingency expenses that they had to pay in respect of the suit. A lay person would think that the amount of statutory fees would be colossal in a matter such as the one the 3rd respondent filed as O.S. 009/2009. As it turned out, the statutory fees that were paid on filing the Originating Summons in court amounted to Ushs. 6,000/= only. The filing fees were paid vide General Receipt No. Y0596984 dated 3/09/09. In addition to that, one would envisage that the advocates also paid some money for photocopying of documents, advertisement of the representative order in the press, transport and other expenses envisaged by the Advocates (Remuneration and Taxation of Costs) Rules. I would not put the amount expended by the 3rd respondents on fees and disbursements in O.S 009/2009 to anywhere more than shs. 1,000,000/=, at the most.

One then wonders whether Rock Petroleum (U) Ltd was so impecunious as to be unable to meet their fees and disbursements for filing the suit. I think not; but it appears to me that the advocates in the 3rd respondent firm also failed to properly advise their client about the professional fees to be paid to them for their work. They instead misrepresented to her that they would pay the fees and disbursements for filing the suit, as though they were too high for the client to pay. If the client was indeed indegent and could not pay the fees, why then did not the 3rd respondents advise her to have recourse to the provisions of Order 33 rule 1 of the CPR? This would have enabled the 1st respondent to apply to bring the suit, which was no doubt in the public interest, as a pauper.
 

The manner in which the 3rd respondents behaved with respect to the fees required to file the suit leads me to only one conclusion. The advocates not only misrepresented the cost of disbursements to be paid by their client but they deceived her about it; and that, prima facie, means that they were fraudulent. I say so because Osborn’s Concise Law Dictionary (7th Edition) defines fraud as obtaining of a material advantage by unfair or wrongful means, involving moral obliquity. Fraud is proved when it is shwon that a false representation has been made, knowingly, or without belief in its truth, or recklessly, careless whether it be true or false. By their traning and experience, the advocates in the 3rd respondent firm, without a doubt, knew exactly how much it would cost them to file the suit, but they did not disclose that cost to their client. They instead chose to exploit and mislead the 1st respondent by the suggestion in item 2 of the Preamble to the fee agreement where they stated as follows:-
 
“The subject matter is involving, big and complex and the Advocates have agreed with the clients for a negotiated fee over and above what is provided for in the Advocates Remuneration Rules.”
 
And for that the 3rd respondents prevailed upon the 1st respondent to sign a fee agreement with them, alleged to be on behalf of all the diesel and petrol suppliers in Uganda, allowing the advocates to be paid, in addition to their taxed costs, 16% of the total proceeds of the clients’ claims or whatever total sum of the claim that the court would finally award or declare to be due to the clients; and in the event of an appeal, to take 4% more to make a total of 20% of the total claim. I therefore came to the conclusion that not only did the advocates in the 3rd respondent firm act fraudulently but they also acted contrary to the provisions of rule 11 of the Advocates (Professional Conduct) Regulations which provides that:
 
“An advocate shall not exploit the inexperience, lack of understanding, illiteracy or other personal shortcoming of a client for his or her personal benefit or for the benefit of any other person.”

The advocates in the 3rd respsondent firm also acted contrary to the provisions of rule 12 of the Advocates (Professional Conduct) Regulations which provides as follows:-

“Every advocate shall advise his or her clients in their best interest, and no advocate shall knowingly or recklessly encourage a client to enter into, oppose or continue any litigation, matter or other transaction in respect of which a reasonable advocate would advise that to do so would not be in the best interests of the client or would be an abuse of court process.” {My Emphasis}  

Though the 3rd respondents fulfiled their duty in advising the 1st respondent (then “the plaintiff”) on the legal aspects of the suit and were immensely successful in their quest, they did not act in the best interests of their client when they led her to enter into the contested fee agreement. It was a transaction that was definitely ill advised and in which the advocates abused their fiduciary relationship with their client, as will be demonstrated later in this judgment.

In addition, and without prejudice to the finding already made above that the very fact of laying a claim to the proceeds of the judgment was illegal, the 3rd respondents ought to have been aware of the implications of the provisions of rules 5 and 6 of the Advocates (Remuneration and Taxation of Costs) Rules. I say so because in their M/A 622/2010, the 3rd respondents claimed that one of the provisions that gave them the mandate to bring that application was rule 5 of the said Rumuneration Rules. On the other hand, it was implied in clause 2 of the preamble to the fee agreement that the 3rd respondents relied on rule 6 of the Remuneration Rules which provides for special and additional fees for exceptional importance and complexity. Rules 5 and 6 of the Advocates (Remuneration & Taxation of Costs) Rules provide as fillows:-
 
 
“5. Additional remuneration for exceptional dispatch.
Where any business requires and receives exceptional dispatch, the advocate shall be entitled to receive and shall be allowed such additional remuneration as is appropriate in the circumstances, which shall be allowable only as between advocate and client.

6. Special fee for exceptional importance and complexity.
(1) In business of exceptional importance or of unusual complexity, an advocate shall be entitled to receive and shall be allowed as against his or her client, a special fee in addition to the remuneration provided in these Rules.

(2) In assessing that special fee regard may be had to—
(a) the circumstances in which the business or part of the business is transacted;
(b) the nature and extent of the pecuniary or other interest involved;
(c) the labour and responsibility entailed; and
(d) the number, complexity and importance of the documents prepared or examined.”
 
Given the provisions above, it is my opinion that the additional fees for exceptional importance and complexity, which were reflected in clause 2 of the preamble to the fee agreement, could not have been decided upon by the advocates themselves on the very day that they filed the suit. Perhaps, exceptional dispatch (under rule 5) could have been determined then in that the 3rd respondents may have undertaken that they would expedite the filing of the suit and follow it through to hearing and conclusion diligently. But with regard to complexity, it is very clear that whether a contentious matter is complex or not is to be determined by the Judge or Magistrate before whom the matter is argued, not by the advocate. This is because item 1(a) (ix) of the Sixth Schedule to the Advocates (Remuneration & Taxation of Costs) Rules provides as follows:-
 
“(ix) where, due to the complexity of a case, a higher fee is considered appropriate, the advocate for either party may apply to the presiding judge or magistrate, as the case may be, for a certificate allowing him or her to claim a higher fee; the judge or magistrate shall then specify the fraction or percentage by which the instruction fee should be increased.”

No such thing happened in O.S 009/2009. Therefore the 3rd respondent firm unlawfully awarded themselves a higher percentage by which their fees would be increased that could only be awarded after the exercise of judicial discretion by a competent court. I am fortified in coming to that conclusion by the decision of the High Court of Kenya in The Republic v. The Minister for Agriculture, Ex Parte W’Njuguna & Others [2006] 1 EA 359, where it was held that the correct perception of a discretion donated by law is that such a discretion is only duly exercised when it is guided by transparent, regular, reliable and just criteria. It appears from this decision that under the Laws of Kenya, determination of the question whether a matter was complex or not is a decision made by the Taxing Officer. Therefore the court went on to lay down the criteria that a Taxing Officer should follow in determining the question as follows:-
 
“Since costs are the ultimate expression of essential liabilities attendant on the litigation event, they cannot be served out without either a specific statement of the authorising clause in the law, or a particularised justification of the mode of exercise of any discretion provided for. The complex elements in the proceedings which guide the exercise of the taxing officer’s discretion must be specified cogently and with conviction. The nature of the forensic responsibility placed upon counsel when they prosecute the substantive proceedings must be described with specificity. If novelty is involved in the main proceedings, the nature of it must be identified and set out in a conscientious mode. If the conduct of the proceedings necessitated the deployment of a considerable amount of industry and was inordinately time consuming, the details of such a situation must be set out in a clear manner. If large volumes of documentation had to be classified, assessed and simplified, the details of such initiative by counsel must be specifically indicated …”
 
I therefore find that the determination of the complexity of the matter by the 3rd respondents even before it was even filed in court, and the charging of up to 20% of the proceeds of the judgment for it was sharp practice on their part and it amounted to gross misconduct. They purported to give themselves the powers of a Judge of this court while dealing with their client and in the process exploited her inexperience and lack of knowledge about the court process and fees chargeable in contentious matters.
 
Unconscionable/extortionate agreement?
Rule 28 of the Advocates (Professional Conduct) Regulations prohibits the charging of excessive fees and undercutting by providing as follows: -
 
28. Excessive fees, etc.
(1) No advocate shall charge a fee which is below the specified fee under the Advocates (Remuneration and Taxation of Costs) Rules.

(2) Where fees are not specified, the advocate shall charge such fees as in the opinion of the Disciplinary Committee are not excessive or extortionate.

 
The rule prohibits undercutting among advocates in order to prevent them from soliciting for more work and creating unfair competition within the profession. Its equivalent in neighboring Kenya was extensively discussed in the case of Njogu & Company Advocates v. National Bank of Kenya Limited (supra). The 3rd respondent firm made an agreement in which they proposed to charge their clients according to the 6th Schedule which provides for charges for contentious matters. A calculation of their fees on the basis of that scale would have produced a handsome fee based on the sum of shs. 56 billion that was recovered in the suit or such other sum as was later agreed after the audit by the Ministry of Finance. In addition to that they could have also charged for exceptional dispatch and complexity of the suit, if proved before the trial judge, and after that the 3rd respondents would have still gone to the bank whistling.
 
However, greed got the better of them. The lawyers in the 3rd respondent firm seem to have desired to earn an income for a life time from one case. They chose to charge, both under the 6th Schedule as well as by an additional percentage, and get 16% or 20% over and above the fees that are provided for by the Sixth Schedule of the Remuneration Rules.

The highest scale of charges in the Advocates (Remuneration & Taxation of Costs) Rules is the 5th Schedule and it provides for business that is not otherwise provided for in those Rules. And rule 15 (2) thereof provides that remuneration prescribed in the First to Fifth Schedules to the Rules does not apply to any business of a contentious character or any proceedings in court or chambers. So that leaves us with the 6th Schedule to asses whether the fees that the 3rd respondent charged per agreement were reasonable, and that should be determined by item 1 (D) and (E) of that Schedule. The instruction fee based on the amount of shs. 56,184,191,050/= would be within the range of shs. 563,229,410/=, Add to it fees as would be determined by a Judge under the provisions of rules 5 and 6 for exceptional dispatch, importance and/or complexity, if at all, and the Advocates would have still had a very handsome fee for their work.

But instead, the 3rd respondents claimed 16% of the total sum recovered bringing their fees to shs. 8.9 billion, before an appeal, and 20% if there was any appeal, bringing the figure to a whopping figure of shs. 11.2 billion. And that would have, according to the fee agreement, been in addition to the taxed costs on the basis of shs. 56,184,191,050/=, (i.e. shs. 563,229,410/=). If that were added to Ushs. 8.9 billion, in the event that there was no appeal, the fees due to the 3rd respondents, per agreement, would have been in the range of shs. 9,463,229,410/=. To this would be added the paltry claims for attendances, Photostat copies, perusals, and telephone calls in addition to proved disbursements out of pocket of the firm. In the event of an appeal, the 3rd respondents’ fees, per agreement, would have been shs. 11,763,229,410/=. It is my view that such fees would not only have been excessive, but they would have also been highly extortionate; that led me to the conclusion that the terms of the fee agreement in dispute appear to have been unconscionable.

Black’s Law Dictionary (9th Edition) defines an unconscionable agreement as one that no promisor with any sense and not under a delusion, would make and which no honest and fair promisee would accept. There appears to be no standard test for determining unconscionability in such cases but I found the American jurisprudence “shock the conscience test” in Rochin v. California, 342 U.S. 165, 72 S. Ct. 205, 96 L. Ed. 183 (1952) persuasive. That is the notion that a court of law applies its conscience, or moral sense, to the facts before it and makes a subjective judgment as to whether a particular contract, or the terms thereof are unconscionable or not. The test seems to have its origins in Equity’s particular moral purpose, as described by Lord Ellesmere in the Earl of Oxford’s Case (1615) 1 Ch Rep 1, as being to ‘correct men’s consciences for frauds, breach of trusts, wrongs and oppressions … and to soften and mollify the extremity of the law’. This is a moral purpose in that it both prevents a party from taking unconscionable advantage of a situation and also in that it prevents the law from inadvertently permitting an unconscionable result (Understanding Equity & Trusts, Rutledge, Cavendish, 2008).
 

Having said that, was the fee agreement between the 3rd respondent firm and the 1st respondent here to take a portion of up to 16% or 20% of the judgment debt on winning the suit reasonable? The schedule of payments due to each of the petroleum and diesel suppliers entitled to refunds, which URA filed in court following the judgment and orders in O.S. 009/2009, showed that the 1st respondent was entitled to recover shs. 3,350,560/= only. The same document was annexed to the affidavit of Ali Sekatawa dated 4/11/2010, in reply to the 3rd respondents M/A 622/2010, as Annexure “A.” Now, there was a promise that the 3rd respondent firm was going to pursue litigation in which the 1st respondent and all the other diesel and petroleum product suppliers in Uganda would recover a large amount of money. The Advocates appeared to know it all and the 1st respondent’s directors reposed their complete trust in them. There appears therefore to have been unequal bargaining power between the two parties to the agreement.

The Court of Appeal of England and Wales dealt with the different categories of unequal bargaining power and/or undue influence in such relationships in Lloyds Bank Ltd. v. Herbert James Bundy [1975] QB 326. Denning, M.R, distinguished a category of cases which he defined as:
 

“… cases of "colore officii", where a man is in a strong bargaining position by virtue of his official position or public profession. He relies upon it so as to gain from the weaker - who is urgently in need - more than is justly due, see Pigott's case cited by Lord Kenyon L.J. in 2 Espinasse at pages 723-4; Parker v. Bristol & Exeter Railway Co. (1851) 6 Exch. 702; Steele v. Williams (1853) 8 Exch. 625. In such cases the stronger may make his claim in good faith honestly believing that he is entitled to make his demand. He may not be guilty of any fraud or misrepresentation. The inequality of bargaining power - the strength of the one versus the urgent need of the other - renders the transaction voidable and the money paid to be recovered back, see Maskell v. Horner (1915) 3 K.B. 106.

To the category above, Lord Denning added yet another which he classified as cases of undue influence as follows:-
These are divided into two classes as stated by Lord Justice Cotton in Allcard v. Skinner (1887) 36 Ch. D. at page 171. The first are those where the stronger has been guilty of some fraud or wrongful act - expressly so as to gain some gift or advantage from the weaker. The second are those where the stronger has not been guilty of any wrongful act, but has, through the relations which existed between him and the weaker, gained some gift or advantage for himself. Sometimes the relations are such as to raise a presumption of undue influence, such as parent over child, solicitor over client, doctor over patient, spiritual adviser over follower. At other times a relation of confidence must be proved to exist. But to all of them the general principle obtains which was stated by Lord Chelmsford, Lord Chancellor, in Tate v. Williamson (1861) L.R. 2 Ch. App 55) at page 6l:
‘Wherever the persons stand in such a relation that, while it continues, confidence is necessarily reposed by one, and the influence which naturally grows out of that confidence is possessed by the other, and this confidence is abused, or the influence is exerted, to obtain an advantage at the expense of the confiding party, the person so availing himself of his position, will not be permitted to obtain the advantage, although the transaction could not have been impeached if no such confidential relation had existed.’”
 
According to the opinion of Lord Sachs in the same case, once the existence of a special relationship has been established, then any possible use of the relevant influence is, irrespective of the intentions of the persons possessing it, regarded in relation to the transaction under consideration as an abuse, unless and until the duty of fiduciary care has been shown to be fulfilled or the transaction is shown to be truly for the benefit of the person influenced. This approach is a matter of public policy.

I therefore find that the relationship between the advocates in the 3rd respondent firm and the 1st respondent was one that fell within both categories of relationships described above in Lloyds Bank Ltd. v. Herbert James Bundy. Thereofore, as a matter of public policy, the fee agreement signed between the 1st and 3rd respondents cannot be allowed to stand. The said agreement had the effecct of enabling the 3rd respondents to exploit their client who was not only in a weaker financial position but she had also reposed her complete trust in them as her advocates. Simply put, the fee agreement had the effect of enabling the 3rd respondent to unfairly profeteer from the litigation, at the expense of its client and the other beneficiaries to the judgment in the suit. The fee agreement was therefore, without a doubt, tainted with undue influence and unconscionable.

v)      

Whether the 3rd respondents engaged in conduct that could be construed as part of the mischief that was intended to be cured by the prohibition of champerty and maintenance.
As was observed by Lord Denning in Re Trepca Mines Ltd. (supra) it is feared that that the champertous maintainer might be tempted, for his own personal gain, to inflame the damages, to suppress evidence, or even to suborn witnesses. He/she may also engage in vexatious litigation and or inflame litigation for his own benefit. The evidence of such conduct in these proceedings is not far off.
 
On 17/11/2010, Mr. Muwema, one of the advocates in the 3rd respondent firm called at my chambers over the matter now under hearing and he lost control and engaged in misconduct before me in my capacity as a judicial officer and as the Acting Head of the Commercial Division of the High Court. He shouted at me and tried to threaten or intimidate me into not issuing an interim order to stay execution of the Deputy Registrar’s order that is under appeal. I believe he did so because he strongly believed that the exorbitant fees that his firm hoped to earn as a result of the contested fee agreement were lawfully due to them. He went on and challenged my jurisdiction when he ordered me to issue an interim order for stay of execution there and then. When I offered that he and his colleagues stay on while I entertained the application for an interim order for stay of execution under M/A 646/2010, Mr. Muwema in a huff, together with his colleagues left my chambers refusing to participate in the proceedings for the said order.
 
After I issued the interim order for stay of execution in thier absence, on the 18/11/2010, the 3rd respondent firm purported to institute an appeal against the interim order yet I had issued it to hold for only a couple of days, i.e. till the substantive application for stay of execution (M/A 646/2010) could be heard inter parte on 19/11/2010. Again on the 18/11/2010 the 3rd respondent firm went on and lodged an application in the Court of Appeal by which they sought to stay all proceedings in this matter before me, including this appeal. They then obtained an interim order in Court of Appeal M/A 194/2010 from the Assistant Registrar of that court, Mr Deo Nizeyimana, to stay the hearing of all the proceediings before me in the matter (i.e. M/A 646/2010 and this appeal).

On the 19/11/2010, the 3rd respondents served the interim order issued by the Assistant Registrar, Court of Appeal on the Deputy Registrar of this court. They also delivered to my chambers a letter addressed to the Principal Judge, and copied to me, in which Mr. Muwema and his partner, Mr. Mugerwa without an iota of evidence unfairly accused me of issuing the interim order for stay of execution because in their opinion I was biased in favour of Mr Allan Shonubi, a partner in one of the firms representing the appellants. They also completely misrepresented to the Principal Judge what transpired in my chambers on the afternoon of 17/11/2010 by stating that I had in “no uncertain terms” told them that I was going to set aside the charging orders issued in their favour by the Deputy Registrar, without giving them a hearing.
 

I proceeded to hear the application for stay of execution (M/A 646/2010) in spite of the interim order issued by the Registrar of the Court of Appeal to stay proceedings and the complaint about me to the Principal Judge. And with all due respect to the learned Assistant Registrar, his intervention in the matter at that premature stage was similar to the actions of the proverbial ‘bull in a china shop.’ A stay of proceedings by the Court of Appeal, especially by a registrar of that court, was uncalled for in a matter that was still sub judice. All I had done in the matter was to issue an interim order pending the hearing of an application for stay of execution, inter parte. The Assistant Registrar definitely had not a clue about the facts regarding the appeal before me, save what had been selectively placed before him by the 3rd respondents in Court of Appeal M/A 194/2010. And that could not have been anywhere but from the subjective point of view, given that the order that had been issued by the Deputy Registrar of this court in the 3rd respondents’ favour was being challenged in this appeal.
 
I am constrained to point out here that not only is it embarrassing for a Judge of the High Court to receive an order from a Registrar, though of the Court of Appeal, to stay all proceedings before him/her, but it is a challenge by the Registrar of the Judge’s jurisdiction in his/her own court. No Judge should be faced with a battle for his or her jurisdiction as such, as happened in this case, with any registrar.
 
Turning to the merits of the registrar’s interim order to stay proceedings, although the position on appeals from interlocutory orders seems to have been settled by the Supreme Court in Criminal Appeal No. 27 of 2009, Charles Harry Twagira v. Uganda, there is still need for clarification of that position in civil proceedings. In that case, the court held that appeals from interlocutory orders should not be entertained because if that were done, it would be conceivable for an accused person to launch appeals against every interlocutory order made during trial which he or she perceives (even incorrectly) to be wrong and thereby render a trial prolonged on frivolous points by appealing on every point of objection. Court also found and held that this would undermine procedures, effective trials and would open gates to abuse of the process of the court and the due administration of justice. I believe the ruling of the Supreme Court though in respect of a criminal appeal can be suitably applied to civil proceedings. Nonetheless, I am of the strong view that given the overwhelming levels of backlog in all courts in Uganda, and at all levels of the judicial process, the time is ripe for specific rules to be laid down regarding appeals to the next court in line from interlocutory orders of the court below.

Having made those observations, although Mr. Siraj Ali and Mr. Kabaiza from the 3rd respondent firm where in court all through the proceedings in M/A 646/2010, all they did that day was to inform court that the Assistant Registrar of the Court of Appeal had issued an interim order to stay all proceedings in the matter before me. After that they refused to participate in the proceedings, I believe in the hope that the application in the Court of Appeal to stay all the proceedings before me would be successful.
 
Surprisingly, after the substantive order for stay of execution was granted ex parte on 19/11/2010, while the advocates from the 3rd respondent firm sat by and observed the proceedings from the gallery, the advocates again purported to commence proceedings to appeal against the order for stay of execution. They lodged a notice of appeal in this court and applied for the record of proceedings but they later abandoned their attempts to appeal even though the record of proceedings had been prepared to enable them to lodge their appeal. Apparently, the 3rd respondents later also abandoned or withdrew their M/A 194/2010 from the Court of Appeal, which was meant to get a final order from that court to stay all proceedings in this matter before the Commercial Court.

Having done so, before this appeal was called on for hearing on 30/11/2010, on 29/11/2010, the 3rd respondent firm filed written submissions raising five (5) preliminary objections on points of law, which they hoped would dispose of the appeal. The submissions were couched in peremptory and/or condescending language in which the Advocates from the 3rd respondent firm inferred that I had not a clue about what I was doing in these proceedings. Before the hearing, I considered the objections, which had been lodged with authorities to support them, and decided to exercise my discretion to defer my ruling on them, because I thought they were only calculated to delay the hearing of the appeal.

After I delivered my ruling to that effect on 30/11/2010, the advocates from the 3rd respondent firm were taken aback. They applied for an adjournment to enable them consider the effect of my ruling, which they unreasonably claimed had disposed of the whole appeal. Because I refused to grant them that adjournment, the advocates from the 3rd respondent firm, led by Mr. Muwema, went up in arms. They applied that I disqualify myself from entertaining the appeal on further allegations that I was biased in favour of the appellants; they raised 10 grounds why they thought so. That unfortunate application for me to disqualify myself, which was originated without following the proper procedure for doing so, was sprung upon me in open court without any warning. It degenerated into a personal affront in which Mr. Muwema again failed to control his emotions and confronted me before a fully packed courtroom in the following manner: -
 

“Muwema: …You are not a proper judicial officer to continue hearing this matter!
Tumusiime: I wish to interject. The manner in which my learned friend is addressing court is not proper.
Court: Let him have his day in court. He is a party to the suit, not just counsel.
Muwema: I put it to you that you are not the proper judicial officer to hear this matter!
Court: It seems I am on trial here! Mr. Muwema, are you now cross-examining me?
Muwema: No, I am not. (He continues in an accusatory manner.) Even the ruling that you have just read appears to have been pre-written. …”

Mr. Muwema did not stop at that, he also treated his colleagues with disrespect and turned the proceedings into a circus where at some point he stood at the bar holding a bottle of water in one hand, and pointing in a disparaging manner at one of his learned colleagues at the bar with the other hand, while he purported to address court. All efforts to try and rein in Mr. Muwema fell on deaf ears. He was so emotionally charged and involved in the proceedings that his mind ceased to function as that of an advocate. But I opted to ignore Mr. Muwema’s impertinence all through the proceedings; I decided not to cite him for contempt of court in the intertest of concluding the hearing of the appeal.
 
That wild application for me to recuse myself resulted in an adjournment of the appeal for a week to enable me to make a rational response to it. I had to write a detailed ruling in which I addressed all the 10 grounds that I had been ambushed with as proof of my bias in favour of the appellants. In my ruling, I declined to disqualify myself but I pointed out that the advocates in the 3rd respondent firm had taken on the indomitable task of defending themselves in contentious legal proceedings. That as a result, they had proved the old adage true “that a lawyer who represents himself has a fool for a client.” It was only then that the advocates from the 3rd respondent firm were shocked back into their professional wits. They woke up and began to perceive the appeal in its proper perspective as a judicial proceeding in which they were litigants, and not as a personal attack by the court against their firm or them as individual advocates seeking to recover their professional fees. I therefore find that the conduct of the 3rd respondents during these proceedings, without a doubt constituted of persistent efforts to inflame litigation. And this was not on behalf of their client, the 1st respondent, but on their own behalf to recover their extortionate fees!

But before that, the advocates from the 3rd respondent firm had committed another faux pas. In M/A 625/2010, the 3rd respondent firm filed an affidavit in reply sworn by Mr. Allan Dokoria on 8/11/2010. In paragraph 3 of that affidavit, Mr. Dokoria stated that M/A 625/2010 was brougt in bad faith because M/s Gapco (U) Ltd, the 3rd appellant here, had disassociated herself from being one of the applicants in these proceedings. Attached to Mr. Dokoria’s affidavit was a photostat copy of a letter dated 5/11/2010 which purported to have been signed by one Aloke Kumar Dandapat, as the Country Head of Gapco (U) Ltd. As it turned out later, in paragraph 3 of an affidavit in rejoinder deposed by Mr. Dandapat on 9/11/2010, Mr. Dandapat denied having signed the letter attached to Mr. Dokoria’s affidavit and averred that it was a forged document.

There is therefore no doubt in my mind that the 3rd respondents would stop at nothing to defend their interests in the course of recovering their hefty fees. To that end, they led the 1st respondent to fabricate false evidence; that was definitely subornation of a witness and it is part of the mischief that the tort of champerty was intended to avert.

 
It is pertinent at this point to emphasise the fact that advocates have a duty to the court that should not be compromised by their personal interests. The lawyer’s duty to the law which creates obligations to the client also imposes a duty upon the lawyer to the administration of justice which the client may, in some circumstances, prefer the lawyer did not have (Rondel v. Worsley [1969] 1 AC 191, 227, per Lord Reid). The lawyer must act for the client as well as uphold, and not subvert, the law. The lawyer must be engaged in a professional capacity and not participate in illegal transactions.
 
The advocate’s simultaneous duty to court and client is particularly critical to the effective functioning of the law in court proceedings. The judge, and the integrity of the system, is peculiarly vulnerable to the advocates who appear on behalf of clients. A judge cannot undertake independent enquiries into the facts and issues of cases which require judicial determination. An effect of this reality, and of these objectives, is that the judge relies heavily upon what lawyers advance on behalf of their clients. It is in that sense that the decision of the judge, and the integrity of the system, is vulnerable to the advocates who appear on behalf of clients. Judges need to be confident about what they are told by the lawyers on behalf of their clients. G.T. Pagone, Judge of the Supreme Court of Victoria. Divided loyalties? The Lawyer’s Simultaneous Duty to Client and the Courts. Monash Guest Lecture in Ethics: 20 November 2009

Another aspect at the heart of the simultaneous duty to court and client is the lawyer’s duty of independence in the conduct of a trial. This involves the duty of candour and honesty and the duty not to mislead the court, but the duty of independence has much practical content in the day to day conduct of proceedings in a court on behalf of a client. The lawyer in court cannot be the “mere mouthpiece” of the client. The lawyer is required to exercise independent judgment and is personally responsible for the conduct and presentation of a case in court. G.T Pagone (op cit) This cannot happen when a lawyer takes on the defence or prosecution of his/her own case. He/she is then deprived of the judgment of an independent third party in framing the theory of the case. Emotion rather than reason dictates the course of action. It is for that reason that rule 9 of the Advocates (Professional Conduct) Regulation exists.
 
Because of rule 9 of the immediately foregoing Regulations, a prudent advocate who is a party to a contetious suit, or who is likely to appear as a witness will not take instructions to act as an advocate. In Laemthong Rice Co. Ltd. v. Principal Secretary Ministry of Finance [2002] 1 EA 119, it was observed that accepted practice did not look favourably on a litigant doubling as Counsel for himself. Where a barrister appeared as a litigant in person, he did so as an ordinary member of the public and was obliged not to address the court from the advocates’ table or in robes. Though the advocate in that case had been granted leave to act as the Appellant’s agent, his actions in acting as agent, witness and advocate were wrongful. It was held that he ought to have instructed another advocate to appear for him rather than become Counsel to himself. Prudent advocates in this jurisdciction will in future observe that practice in order to avoid a repeat of the unfortunate debacle that occurred in this case; especially when the advocates from the 3rd respondent firm applied that I do recuse myself from hearing this appeal, instead of themselves retaining an independent advocate to represent them, as they later did.
 
There is therefore no doubt that the unbecoming conduct of the advocates from the 3rd respondent firm in this case was a result of their vested interest in the agreed percentage of the judgment debt due to them. As a result of that vested interest, all that the advocates could see was the prospect of earning up to shs 8.9 billion being 16% of the total amount of over shs 56 billion recovered, or at most shs 11.2 billion, if there was an appeal. The advocates from the 3rd respondent firm lost their professional independence as advocates for the claimants of excise duty refunds from URA and took on a personal battle to recover their share of the spoils from the litigation. This case therefore, without any doubt, amply demostrated the gravity of the consequences of advocates maintining suits, and therefore the raison d’

tre behind the prohibition of champerty and maintenance in the Advocates Act and the Advocates (Professional Conduct) Regulations. It was therefore erroneous of Counsel for the 1st and 3rd respondents to submit that his clients did not engage in any misconduct as a result of participating in a champertous adventure. This judgment demonstrates that as a result, the 3rd respondents broke almost every basic rule in the Advocates (Professional Conduct) Regulations.


vi)     

Whether the 3rd respondents engaged in any other dishonest dealing or misconduct in these proceedings

I found it necessary to deal with this additional question, which encompases other forms of conduct that were not raised by the appellants, because of the reasons given in Ngakwila v. Lalani (supra), that on appeal the court has the duty to point out all illegalities even when they have not been raised by the parties or their advocates. I would answer the question in the positive because on the day that they filed O.S 009/2009, the 3rd respondents entered into the contested fee agreement with their client. In fact it is apparent that the filing of the suit, or the taking of instructions to file the suit was conditional upon the execution of that agreement. However, when they argued the suit, the 3rd respondents did not disclose the fee agreement to the trial judge. As a result, my brother Mukasa, J. entered judgment with costs in their favour. In conclusion of his judgment, the Learned Judge ruled as follows:-
 
“Unless court has reason to order otherwise, costs follow the event. See s.27 of the Civil Procedure Act. I have no reason to order otherwise. The plaintiff is entitled to costs of the suit.”
 
The advocates uttered not a word about the agreement yet the resultant order would be contrary to the provisions of the Advocates Act. I came to that conclusion on authority of James Mutoigo T/A Juris Law Office v. Shell (U) Ltd., M/A 781/2005, where Egonda-Ntende, J. ruled as follows:-

“It would appear to me that once there is an agreement for remuneration for contentious business, by virtue of the provisions of Section 54 of the Advocates Act, an advocate cannot present a bill, an advocate/client bill of costs, for taxation of costs, except in accordance with Sections 52 and 53 of the Advocates Act. In this case, if it was found, as it was, that the relationship between the parties was covered by a remuneration agreement, the advocate’s bill was rightly rejected. Enforcement of the agreement would have to proceed in accordance with Section 50 (3) of the Advocates Act.”

According to rule 17 of the Advocates (Professional Conduct) Regulations, it is the duty of an advocate to advise the court on matters within his or her special knowledge. Rule 17 provides that:-
 
“(1) An advocate conducting a case or matter shall not allow a court to be misled by remaining silent about a matter within his or her knowledge which a reasonable person would realise, if made known to the court, would affect its proceedings, decision or judgment.

(2) If an irregularity comes to the knowledge of an advocate during or after the hearing of a case but before a verdict or judgment has been given, the advocate shall inform the court of the irregularity without delay.”

The highest duty of a lawyer is that of fairness and candour to the court. Because of this, a lawyer must not mislead the court in relation to the law or the facts. In APC Lobo & Another v. Saleh Salim Dhiyebi & Others [1961] 1 EA 223, the Court of Appeal for East Africa held that an advocate who appears for a client in a contested case is retained to advance or defend his client’s case and not his own. This he must do strictly upon instructions and with a scrupulous regard to professional ethics. Remembering that he is an officer of the court and owes a duty to the court as well as to his client, he must never knowingly mislead the court as to the facts or the law. Moreover, in Giannarelli v. Wraith (1988) 165 CLR 543, at 556-7, Mason CJ, said that the peculiar feature of counsel's responsibility is that he owes a duty to the court as well as to his client. His duty to his client is subject to his overriding duty to the court (See also Myers v. Elman [1940] AC 282 at 292; per Lord Maugham). And that in the performance of that overriding duty there is a strong element of public interest. I find that decision not only persuasive but compelling, especially in this case where the costs claimed were not for the benefit of their clients but for the benefit of advocates themselves.

The 3rd respondents therefore deliberately did not inform court about their fee agreement with the 1st respondent. And at the hearing of M/A 622/2010, Mr. Mulema Mukasa informed the Registrar that the bill of costs against the defendant would be filed in its own right to recover the party to party costs, since the fees per agreement were only additional to the taxed costs. The Learned Registrar noted this at Line 15, page 9 of her ruling. The advocates therefore had every intention of benefiting both from the fee agreement as well from the taxed costs payable by the defendant (now the 2nd respondent). This could be construed as fraudulent conduct unbecoming of an advocate and it, of course, amounted to professional misconduct.

vii)    
Whether the 3rd respondents could recover their fees, per agreement through court, as they purported to do.
Counsel for the 3rd respondents strenuously argued that his clients should not be deprived of the costs because of the illegalities raised by the appellants and which no doubt did take place and were knowingly perpetrated by the 3rd respondents. In his submissions counsel argued that the Advocates Act never intended to be cruel and punish advocates who have diligently worked for the benefit of others by denying them their remuneration. He further submitted that the decision in Makula International v. Cardinal Nsubuga (supra) recognizes that the general level of remuneration of advocates must be such as to attract recruits to the legal profession.
 
I agree with the general principle that advocates must be justly and fairly compensated for their labour. Further that fair compensation attracts recruits to the profession. However, the converse is also true, unjust enrichment of advocates out of adventures, like the one complained of here, could have the negative effect of attracting unsuitable recruits to the profession; persons who are out to get rich quickly and get out as soon as they harness a fortune. The droves of prospective students registering at the various tertiary institutions in this country to offer degrees in law may be a symptom of that problem. The degenerating standards of advocacy and the impunity with which advocates in this jurisdiction cheat clients, which is reflected in the backlog of cases accumulating before the Disciplinary Committee of the Uganda Law Council Uganda Legal and Judicial Sector Study, Legal Vice Presidency, World Bank, 2009, could be further evidence of that trend. It is for that reason that errant advocates should be sternly and swiftly punished for their misdeeds, lest the legal profession ceases to be referred to as an honourable and/or learned profession because in cases such as this one, it is my opinion that the legal profession takes on the characteristics of a ‘legal mafia’. I believe it is for that reason that s. 69 of the Advocates Act exists, and it provides as follows: -
 

“69. No costs recoverable for acts constituting an offence.

No costs shall be recoverable in any suit, proceedings or matter by any person in respect of anything done, the doing of which constituted an offence under this Act, whether or not any prosecution has been instituted in respect of the offence.”
 
S.69 of the Act was framed in mandatory terms. There are no exceptions to the rule that was set down in that provision. In the face of s.69 of the Act, there even seems to be no defence that can be advanced in order to go round the punishment prescribed by that provision. And for obvious reasons, the advocate who contravenes the provisions of the Advocates Act cannot claim ignorance of the law as a defence, for it is his/her paramount duty to be well versed, especially with the law and the rules that govern the practice of his/her profession. Liability must therefore of necessity be strict.
 
In another interesting turn of his arguments, counsel for the 1st and 3rd respondents argued that the decision in the case of Mkono & Co. Advocates v. J. W. Ladwar (1977) Ltd. (supra), which counsel for the appellants relied on to submit that an advocate who enteres into a champertous agreement is not entitled to fees, could be distinguished from the instant case because in the former, the advocates did not file the suit they were instructed to file while the advocates in this case filed a suit, argued it and obtained judgment. Further that had the advocates in the Mkono case filed the suit, as the advocates in this case did, the court would have arrived at a different finding and not cancelled the fee agreement.

It is my view that the argument advanced by counsel cannot be maintained in any circumstances where a champetous maintainer is discovered by the court, or indeed where they admit that they participated in a champertous enterpirse, as counsel for the 3rd respondent did in this case. In Re Trepca Mines Ltd. (supra) Lord Denning M.R. ruled, and I entirely agree with his decision that:-
 

“If champerty is an evil, as the common law believes it to be, it is just as much an evil in the one case as the other. In my opinion, it extends to any contentious proceedings where property is in dispute which becomes the subject of an agreement to share the proceeds.”

There can be no extenuating circumstances unless the advocate was not involved at all in the champertous enterprise. The same question was considered in Njogu & Company Advocates v. National Bank of Kenya Limited [2007] 1 EA 296, where while considering the provisions of the Kenya Advocates Act and Regulations, and a situation were an advocate tried to wriggle out of a champertous agreement that had been drawn below the scale fees, Warsame, JA. ruled as follows:
 
“The Advocate knew and was conscious of the effect and implication of the contract he was entering into and once he appended his signature on the contract, then he ha(d) no way to wriggle out of it. The law provides that an Advocate can enter into a contract on payment of fees. And if he decides to bind himself to a sum far below the scale allowed, then he cannot be heard to rubbish the contract. The contract allowed the Advocate to get work from the Bank, therefore when a dispute arises the court must allow parties to bath their baby. The court should not in my view provide water to wash the dirt from the baby conceived and carried by the Advocate, when the baby is of no more beneficial use to the Advocate.”

In like vein, Mr. Fred Muwema who appended his hand to the fee agreement in dispute here did inform the court that he is the legal expert on representative actions in Uganda. That he had been in that business for 15 years. {Refer to my ruling in M/A 645/2010 (No.1)}. Therefore, in the words of Warsame, JA, Mr. Muwema declared that he is ‘learned in the tools of (his) trade and the moment he submited himself to a situation contrary to his professional calling, then the baby had to remain on his lap.’
 
Again in the Njogu case, Warsame, JA. further observed:
 
“If the Advocate willingly and with his legal mind, enters into an agreement with his client, then he has a cardinal and fundamental duty to ensure compliance with the law. The law is meant to protect the Advocate from unprofessional conduct, which is contrary to the spirit and intendment of Chapter 16 Laws of Kenya. In my humble view Chapter 16 is meant to protect the Advocate and the public from unprofessional and illegal acts or omissions. It is the duty of the Advocate that he does not put himself in situations, where he unfairly and illegally attracts business to himself by breaking the law. That is why the law does not permit undercutting and touting, for it accords undue advantage to a particular Advocate.”
 
In Re Trepca Mines Ltd (supra) it was held that the principle applicable in such cases is “Ex turpi causa non oritur actio.” One of the learned judges observed that this old and well-known legal maxim is founded in good sense, and expresses a clear and well-recognised legal principle, which is not confined to indictable offences. No court ought to enforce an illegal contract or allow itself to be made the instrument of enforcing obligations alleged to arise out of a contract or transaction which is illegal, if the illegality is duly brought to the notice of the court, and if the person invoking the aid of the court is himself implicated in the illegality. He added that it matters not whether the defendant has pleaded the illegality or whether he has not. If the evidence adduced by the plaintiff proves the illegality the court ought not to assist him (Per Pearson LJ, Denning MR and Donnovan, LJ., concurring). In that case the charging order that had been issued in favour of the soliciotor was discharged and leave to appeal to the House of Lords was denied.
 
The same position was adopted by the Supreme Court of Uganda in Active Automobile Spares Ltd. v. Crane Bank & Rajesh Pakekh, SCCA No. 21 of 2001, [Per Oder, JSC (RIP)], where the appellant purported to deal in foreign exchange contrary to provisions of the Exchange Control Act, and to rely on that transaction as evidence in court. Relying on the decision in Scott v. Doering & Co (No.3) (1892) 2 QB, 724, the Supreme Court held that a court will not condone or enforce an illegality. Likewise, in Njogu & Company Advocates v. National Bank of Kenya Limited (supra) it was held that an advocate who makes an agreement for fees, removes himself from being entitled to scale fees. It was further held that an advocate who makes a champertous or otherwise illegal agreement on fees is more responsible than the client and should not benefit from that illegality to obtain extra fees.
 
I was therefore not persuaded by the argument advanced by counsel for the 1st and 3rd respondents that denying the 3rd respondent recovery of any fees from the champertous adventure would amount to “creating a different kind of mischief” other than that which was intended to be cured by the doctrines of champerty and maintenance. In Re Trepca Mines Ltd., it was held that “The principle of public policy is this; ex dolo malo non oritur actio. No court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act. If, from the plaintiff’s own stating or otherwise, the cause of action appears to arise ex turpi causa, or the transgression of a positive law of this country, there the court says he has no right to be assisted.” (Holman v. Johnson (1775), 1 Cowp at p 343, applied.) Therefore, just as the solicitor in Re Trepca Mines could not be, the advocates in this case cannot be assissted by the court to benefit from an illegal contract, for that would clearly be against public policy.

viii)   

Whether the 1st respondent was equally liable for the misdeeds committed by her advocates?
As it was held in the Njogu & Company case, in Re Trepca Mines Ltd (supra), it was held that when a solicitor makes a champertous agreement with his client, the parities are not in pari delicto. The solicitor is the more guilty, for he ought to know better than to stipulate for a percentage for himself. If he recovers a fund which belongs to his client, he ought to hand it all over to his client, and not be allowed to deduct anything for his costs. He cannot sue for the costs directly, and there is no reason why he should recover them indirectly by deduction out of his client’s money.

I have already ruled above that the 3rd respondent firm exploited the 1st respondent when they prevailed upon her directors to enter into the unconscionable and champertous fee agreement with them. It could be possible that the 3rd respondent had other secret agrangments with the 1st respondent firm to share in their fees from the suit, but that was not proved against her. It remains a mere suspicion in the mind of the court. That being the case, the 1st respondent is still entitled to recover her refund of Excise Duty from the 2nd respondent according to the judgment in O.S 009/2009, notwithstanding the fact that the fee agreement which she entered into with the 3rd respondent is illegal and therefore not binding on her either.

ix)     

Whether the appellants were in pari delicto with the 3rd respondent and therefore disentitled from benefiting from the judgment in O.S 9/2009.
In an argument that I found novel, counsel for the 1st and 3rd respondents tried to persuade me that because the claim for the refunds was based solely on the case pursued in court by an advocate on the basis of an agreement that is said to be illegal, it follows that the appellants cannot benefit from the judgment, when the advocates who brought the success about are “drenched in illegality”. But as already observed above, if the 3rd respondents are “drenched in illegality” as their advocate described them, then that illegality is their baby; they cannot abandon it.
 
Nonetheless, it is important to separate the two instruments; the judgment on the one hand and the fee agreement on the other. While the instructions of the 1st respondent were tainted with illegality due to the contingent fee agreement; that illegality did not affect the proceedings in court until the 3rd respondent firm attempted to have the fee agreement enforced in M/A 622/2010, in order to recover part of the judgment debt as their fees. That event took place on 2/11/2010, more than 3 months after the judgment was delivered on 20/07/2010. A clear distinction was drawn between the two processes, that is the suit and the enforcement of the fee agreement, in Re Trepca Mines Ltd (supra) where it was held that there must be active participation by the solicitor in the illegal transaction before he is disentitled to his costs. If he is himself a party to the champertous agreement by stipulating for a percentage for himself, the answer is clear. He cannot recover anything! In spite of that, the appellants in that case still recovered their claim of GB

70,000.

I was therefore not persuaded by the argument presented by counsel for the 3rd respondents that the judgment in O.S. 009/2009 would fall if this court declared that the fee agreement in dispute was illegal and void and therefore liable to be set aside. The judgment stands because it was definitely not tainted with the illegality attendant to the fee arrangments made between the 3rd and 1st respondents.

 
The Supreme Court of Uganda threw more light on the same question in Active Automobile Spares Ltd v. Crane Bank & Rajesh Pakekh (supra). Citing the decision in Scott v. Brown Doering (supra), the court held that if the plaintiff cannot maintain his cause of action without showing as part of such cause of action that he has been guilty of illegality, then the court will not assist him. The Court went on to state the decision in Taylor v. Chester (4) (1869) LR 4 QB. 309, that the true test for determining whether or not the plaintiff and the defendant were in pari delicto is by considering whether the plaintiff could make out his case otherwise than through the medium of the illegal transaction.
 
The question that needs to be asked of the appellants here then is, can they recover their Excise Duty refunds without relying on the fee agreement between the 1st and 3rd respondents? Of course they can. They need not even rely on the judgment in O.S 009/2009, but could simply present evidence to URA that during the Finacial Year in contest, they did pay Excise Duty over and above what they were required to pay, i.e. after the expirry of the Taxes and Duties (Provisionsl Collection) Act.

x)      
Whether the appellants were the 3rd respondents’ clients; and whether they had any obligation to pay the 3rd respondents’ fees, per agreement with the 1st respondent.
Had not the fee agreement been illegal and unenforceable, would the appellants here have been liable to pay the 3rd respondents’ fees? Counsel for the 1st and 3rd respondents contended that the appellants were liable to pay, on the basis of the fee agreement with the 1st respondent who was their representative for purposes of filing and prosecuting the suit. Counsel went to to cite the provisions of s.23 of the Interpretation Act in support of his argument.
 
The question that first needs to be answered here is whether the appellants and the rest of the beneficiaries to the judgment in O.S 009/2009, apart from the 1st respondent were also the 3rd respondents’ clients. The word “client” is defined in s. 1 (b) of the Advocates Act to include any person who, as a principal or on behalf of another, or as a trustee or personal representative, or in any other capacity, has power, express or implied, to retain or employ, and retains or employs, or is about to retain or employ, an advocate and any person who is or may be liable to pay to an advocate any costs. The Kenya equivalent of s.1 (b) of the Advocates Act was interpreted by the Court of Appeal of Kenya in Uhuru Highway Development Ltd. & Others v. Central Bank of Kenya & Others (2) [2002] 2 EA 654. The three Justices of that court concurred with the definition of a “client” as being any person who pays any costs to an advocate.
 
Now, the appellants here did not pay any costs to the 3rd respondent firm. Neither did they bind themselves to pay any fees to them as the 1st respondent did in the contested fee agreement. The appellants and all the other beneficiaries to O.S 009/2009 were therefore definitely not the 3rd respondents’ clients within the meaning of the Advocates Act, as defined in the Uhuru Highway case above.
 
As to whether the 1st respondent was the “personal representative” of the appellants and the rest of the beneficiaries to the judgment in O.S. 009/2009, within the meaning of s.1 (b) of the Advocates Act, the expression “personal representative” is not defined by the Advocates Act. However, the term “personal representative” is defined in s.1 (c) of the Law Reform (Miscellaneous Provisions) Act to mean, in the case of a deceased person to whom the Succession Act applies, either wholly or in part, his or her executor or administrator. And in the case of any other deceased person, it means any person who under law or custom, is responsible for administering the estate of the deceased person.

There is also a definition of the term “legal representative” which seems to be similar to “personal representative” in s. 2(k) of the Civil Procedure Act. Again in that provision, “legal representative” means a person who in law represents the estate of a deceased person and where a party sues or is sued in a representative character, the person on whom the estate devolves on the death of the party so suing or sued. Now, in s. 1(b) of the Advocates Act, the term “personal representative” follows immediately after the word “trustee”, (i.e. the provision reads “as trustee or personal representative”). It is therefore my view that the expression “personal representative” has to be construed ejusdem generis, and to be of the same genre as “trustee,” before it. The two expressions in the provision are therefore used interchangeably.
 

That brings me to the conclusion that the personal representative in s.1 (b) of the Advocates Act has to be the same person as the “personal representative” that is defined in s.1 (c) of the Law Reform (Miscellaneous Provisions) Act and s. 2 (r) of the Succession Act, that person appointed under the law to administer the estate or any part of the estate of a deceased person. He/she is also referred to as a “legal representative,” and by virtue of s.180 of the Succession Act, such a person (the executor or administrator) is the legal representative of the deceased for all purposes, and all the property of the deceased person vests in him or her as such. It therefore becomes amply clear that the representative in a class action that is given permission to bring a suit on behalf of other persons under the provisions of Order 1 rule 8 cannot be a “personal representative” for purposes of s. 1(b) of the Advocates Act. The other plaintiffs not named as parties in the representative action are definitely not in the same position as one who is deceased. The representative in a class action cannot therefore be construed to be their representative for all purposes and all their property cannot vest in him/her as such.

As to whether the provisions of s.23 of the Interpretation Act apply to the representative appointed by court to bring a class action; and whether he/she is thereby allowed to enter into legal arrangements, including signing fee agreements with the advocates retained to prosecute the suit, so as to defray the legal fees from the judgment debt; s. 23 of the Interpretation Act provides as follows: -

 
23. Implied power.
Where any Act confers a power on any person to do or enforce the doing of any act of thing, all such powers shall be understood to be also given as are reasonably necessary to enable the person to do or enforce the doing of the act or thing.”
 
It is my view that in order to determine whether the order that was granted to the 1st respondent implied that he had the power to retain an advocate, at the cost of plaintiffs not named in the suit, one also needs to scrutinize the terms of that order. The relevant items of the order in M/A 181/2009 were as follows:-
 
“1. The Applicant be and is hereby granted permission to sue the Respondent in a representative suit, on its behalf and for the benefit of numerous importers of Diesel and Petrol in Uganda seeking monies illegally collected by the Respondent as Excise Duty in the 2007-2008 financial year.

2. The Applicant shall give notice of institution of the suit to all the said importers by public advertisement in a News Paper circulating widely in Uganda. {My Emphasis}
 

It therefore follows that O.S 009/2009 was brought on “behalf of the 1st respondent” and also “for the benefit of the numerous importers of Diesel and Petrol in Uganda.” Nothing was said in the order about how the fees for the suit would be raised. It is therefore my view that by virtue of the provisions of s.23 of the Interpretation Act, the 1st respondent impliedly had the power to retain an advocate, at her own cost, and that advocate would also act or acted “for the benefit of” all the plaintiffs not named in the suit.

I found it difficult, nay impossible, to conclude that by virtue of the provisions of Order 1 rule 8 of the CPR, which is the operative law here for purposes of s.23 of the Interpretation Act, it could be implied that the representative who is granted leave to bring a class action is impliedly also granted the power to give away the proceeds of the judgment as he/she wishes, even if it is for purposes of defraying the fees or the costs of the suit. I am of the firm view that the power granted to such a representative is limited to prosecuting the suit to the point of judgment. Having done so, and as I have already held above, the proprietary rights of the beneficiaries to the proceeds of the judgment which are insured by the Constitution take over. The beneficiaries are then estopped from bringing any other suit based on the same cause of action or raising similar issues to those that have been disposed of in the class action.
 
Would the appellants be liable to pay the 3rd respondents’ fees in any other capacity? The answer to that question lies in establishing whether the appellants and the other beneficiaries to the judgment in O.S 009/2009 were parties to the suit or not. And it is to be found in the common law and the interpretation of the Code of Civil Procedure of 1908, from which our Civil Procedure Rules were derived. Chitaley & Rao in their Commentaries on the Code of Civil Procedure (V of 1908, 7th Edition, at page 1905) stated as follows:-
 
“… the costs of all suits are within the discretion of the court and the court can determine by whom or out of what property costs are to be paid. As a general rule, only parties on record are liable to pay costs. The rule applies also to representative suits. Hence, in such cases as a general rule, costs should be awarded only against parties on the record but not against other persons whom the parties on the record may not represent. But that is not an inflexible rule. In exceptional cases, costs may be awarded to be paid by persons who are not parties on the record but on whose behalf or for whose benefit the suit has been brought and defended. The court may also, in a fit case, direct the costs to be paid out of any property which may belong to the community represented in the action. In any case, great caution is necessary on making an order as to costs in a representative suit. …”                             {My Emphasis}
 
Apparently the position at common law, to which India subscribes, is no different. It was expressed by the High Court of England and Wales in David Roy Howells & James Kelly v. The Dominion Insurance Company Limited, [2005] EWHC 552 (QB), where it was held following the decision in Moon v. Atherton [1972] 2 QB 435, that:-
“In relation to the costs, the Master expressed himself entirely satisfied that the matter was covered by the decision of the Court of Appeal in the case of Moon v. Atherton [1972] 2 QB 435 and in particular the dicta of Lord Denning that:
“In a representative action, the one who is named as a Plaintiff is, of course, a full party to the action. The others who are not named, but whom she represents are also parties to the action. They are all bound by the eventual decision in the case. They are not full parties because they are not liable individually for costs. That was held by Eve J. in Price v. Rhondda Urban District Council, but they are parties because they are bound by the result.”
The position had been established before by Moulton L.J. in Markt & Co. Limited v. Knight Steamship Company Limited (CA) [1910] 2 QB 1021, where he ruled at page 1039, as follows: -
“The Plaintiff is the self-elected representative of the others. He has not to obtain their consent. It is true that consequently they are not liable for costs, but they will be bound by the estoppel created by the decision.”                   {My Emphasis}
Given the observations of Moulton L.J above, the raison d’

tre behind the rule that the other beneficiaries to the judgment need not pay the costs is that he/she that decides to bring a representative action does so at his or her own behest. He does not first inquire from the other beneficiaries whether they accept him/her as their representative or not. But they on the other hand by his/her election to bring the suit become “free riders.” Financing Class Actions, James H. MacMaster & Ward K. Branch; retrieved on 21/12/2010 from www.branmac.com They are estopped from bringing other suits arising from the same cause of action since they benefit from the judgment. It follows therefore, that the appellants here, and all beneficiaries to the judgment in O.S 009/2009, save for the 1st respondent, were not “clients” of the 3rd respondent firm; they were ‘free riders’ on the suit that the 1st respondent filed. They had no obligation whatsoever under the law to pay fees or costs to the 3rd respondent, unless ordered to do so by court; and that did not happen.
I therefore find that the orders of the Deputy Registrar that the appellants do pay the 3rd respondents’ fees on the basis of the contested fee agreement and the representative order that was issued to the 1st respondent, because they were under her authority, was totally misconceived and illegal. The representative order only empowered the 1st respondent to prosecute the suit; what was recovered was not all her property. She therefore had no authority, implied or otherwise to give the appellants’ monies away to her advocates.
xi)     

Remedies
The Advocates from the 3rd respondent firm engaged in a multiplicity of forms of professional misconduct. They entered into a champertous fee agreement and brought it to this court in a bid to enforce it. They almost succeeded, as they did in the previous application that they filed against URA whose details were summarised above (M/A 376/2007, M/s Muwema & Mugerwa, Advocates v. Uganda Revenue Authority). It appears that the 3rd respondent firm had purposed to make URA, through the large numbers of persons that sometimes have legal claims against it, their banana plantation. They had also perfected the art of using representative actions to unjustly enrich themselves instead of employing them as a tool for ensuring that large numbers of people with similar claims against the same body access justice efficiently and at a limited cost. There is no doubt in my mind that such conduct amounted to an abuse of the process of the court.
 
Abuse of process is a tort that is very much recognized by the common law and the statutes. In his textbook “The Law of Torts” (6th Edition, The Law Book Company Ltd., Sweet & Maxwell, London,) J.G. Flemming recognizes abuse of process as a tort that is different from malicious prosecution. Relying on the decision in Varawa v. Howard Smith (1911) 13 C.L.R 35, 91 (per Isaacs, J.) he states at page 589 that:
 
“…the gist of this tort lies not in the wrongful procurement of legal process or the wrongful launching of criminal proceedings, but in the misuse of process, no matter how properly obtained for any other purpose other than that which it was designed to serve. It involves the notion that the proceedings were ‘merely a stalking horse to coerce the defendant in some way entirely outside the ambit of the legal claim upon which the court is asked to adjudicate.’ It is therefore immaterial whether the suit thus commenced was founded on reasonable cause or even terminated in favour of the instigator: the improper purpose is the gravamen of liability.”
 
The same source (at page 590) singles out the torts of champerty and maintenance as special categories of abuse of court process. In addition, Paragraph 931 of Vol. 37, Halsbury’s Laws of England states in part that:
 
“… A party may be guilty of an abuse of process of the court even though he may comply with the strict literal terms of an applicable rule of law, where he does so for improper or ulterior motives or purposes.”
 
American jurisprudence has apt definitions of abuse of process which I found useful to elucidate the concept. In McCornell v. City of Jackson, 489 hyperlink 605, abuse of process was defined as “the intentional use of legal process for an improper purpose incompatible with the lawful function of the process by one with an ulterior motive in doing so and with resultant damages.” In DeNardo v. Maassen, 200 P.3d 305, the Supreme Court of Alaska found that the tort is comprised of two elements: an ulterior purpose and a wilful act in the use of process not proper for the regular conduct of proceedings. Further that the first element, ulterior purpose, usually consists of coercion to obtain a collateral advantage, not properly involved in the proceedings itself, such as the surrender of property or the payment of money with the use of the process as a threat or a club. The second element involves an overt act, but actions taken in the regular course of litigation, such as threatening suit or requesting discovery, are not a proper basis for an abuse of process claim even if done with an ulterior motive.

I would hold that O.S 009/2009 fell within the first category of abuse of the process of this court. The 3rd respondent firm did file a suit for the sole purpose of obtaining extortionate fees based on a champertous agreement with the 1st respondent from the beneficiaries to the judgment in the suit. They then filed M/A 622/2010 in order to access those fees, a further abuse of the process of the court. The Advocates in the 3rd respondent firm therefore not only contravened the provisions of the Advocates Act and the Advocates (Professional Conduct) Regulations but they also abused the process of this court with impunity.

The foregoing discussion calls to mind the provisions of s. 98 CPA which provides for the inherent powers of the court as follows:
“Nothing in this Act shall be deemed to limit or otherwise affect the inherent power of the court to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of the court.”

The discipline of Advocates in this jurisdiction has hitherto been exclusively vested in the Disciplinary Committee of the Uganda Law Council. However, that body is bogged down with a backlog of cases that it is proving difficult for it to catch up with because it has to deal with an ever increasing number of advocates brought before it for their misconduct.
In 1970 when the Law Council was established there were only a total of 189 enrolled advocates in Uganda some of whom were civil servants. With liberalization of the economy and the education system, there is a high turn over of law graduates from Makerere University and other universities within and outside Uganda. As a result, by close of Year 2006/2007 there were over 800 advocates being supervised and disciplined by the same structure that was set up in 1970 to cater for 189 advocates. The Disciplinary Committee of the Law Council sits only once each week to hear complaints filed against advocates. The backlog continues to grow. Uganda Legal and Judicial Sector Study, Legal Vice Presidency, World Bank 2009 Therefore, even if a complaint were lodged against the partners in the 3rd respondent firm before that body, it will have to wait in line for complaints that have gone to the Disciplinary Committee before it. It is for that reason that I have chosen to take the disciplinary action next following in these proceedings.

Section 17 of the Advocates Act saves the powers of the courts with regard to the discipline of Advocates as follows:-

“Nothing in this Act shall supersede, lessen or interfere with the jurisdiction of any court, inherent or otherwise, to deal with misconduct or offences by an advocate, or any person entitled to act as such, committed during, or in the course of, or relating to, proceedings before the court.”
 
I am well aware of the guidance that was given by the Court of Appeal for Eastern Africa in situations where the court discovers an advocate’s misconduct during the course of proceedings in APC Lobo & Another v. Saleh Salim Dhiyebi & Others (supra), and I think it is appropriate to reproduce the relevant text from that judgment here.
 
“A court, if it considers that an advocate, in his conduct of a client’s case, has been guilty of misconduct, should find facts only in so far as is necessary to dispose of the case before it. Remembering that it is the client’s case and not that of the advocate which it has heard and is called upon to decide, it should deal in the judgment with the advocate’s conduct only in so far as that is necessary to the case before it, and, if the court is of opinion that a prima facie case of professional misconduct is disclosed, should refer the matter to the appropriate professional body for report and if necessary for adjudication by another court. That other court will be concerned with the question of the advocate’s conduct and not with adjudication of the client’s cause; and the advocate will then have an opportunity of explaining, if he wishes to do so, matters which appear to be prejudicial to him.
 
In the above remarks it has been assumed that the conduct of the advocate has not amounted to a contempt committed ex facie the court to which different considerations apply and which might have to be dealt with in a more summary manner.”
 
It is important to note that though the decision above suggests that punitive action for conduct that amounts to contempt of court has to be taken in a summary manner, as is provided for by s.107 (2) of the Uganda Penal Code Act, s. 107 (3) of the Act provides that the provisions of s.107 (2) shall be deemed to be in addition to and not in derogation of the power of the High Court to punish for contempt of court. To my mind, that means the High Court need not punish for contempt summarily, as is provided for in s.107(2), but may defer the punishment to later on.

In addition, to the above it is my carefully considered opinion that the facts of the appeal now before court can be distinguished from those in APC Lobo & Another. As I pointed out at the beginning of this judgment, this appeal took on the nature of and was in fact a judicial disciplinary proceeding agaisnt the 3rd respondents, regardless of the fact that it had two other parties that were named as respondents. It is also evident from this judgment that the gist of the appeal concerned the questions whether or not the advocates from the 3rd respondent firm engaged in conduct that contravened the several provisions of the Advocates Act and the various regulations thereunder that were named in the appeal.

Moreover, though the 3rd respondents purported to represent the 1st respondent when the appeal was first called on for hearing, by the end of it the 3rd respondents no longer did so. After I delivered my decision declining to disqualify myself from entertaining the appeal, Mr. Siraj Ali who was in court on behalf of the 1st and 3rd respondents applied for an adjournement to allow both respondents to retain another advocate. Though that application was denied, court advised Mr. Siraj Ali to have his firm retain an independent advocate and thereafter present a written response to the submissions of counsel for the appellants, if they so chose, on behalf of his firm and for the 1st respondent. And indeed on the 14/12/2010 KSMO Advocates did file written arguments on behalf of the 1st and 3rd respondents.

It is therefore my humble opinion that there need be no further findings of fact about the conduct of the 3rd respondents here, because all the relevant facts are on the court record; they are amply displayed within the conduct of the advocates recorded in M/A 622/2010, M/A 646/2010 and M/A 645/2010, which is this appeal, and in the contested fee agreement that they entered into with the 1st respondent.

Suffice it to say that the courts need no longer sit by, as though impotent under the law, and do nothing about the impunity and gross misconduct, such as that which was displayed by advocates from the 3rd respondent firm in these proceedings. If the courts do not take stern action to stem the abuse of court process, the system of justice will degenerate into a mockery. And if that were to happen in this particular case, the perceived result would be that not only do the courts allow advocates to abuse the process of the courts willy nilly; but that in addition to that, when their misconduct is inquired into by the courts, judicial officers suffer advocates to walk rough shod upon their heads, and they have no legal mechanisms to take corrective or punitive action agaisnt them. The automatic result will be that the legal profession will continue to lose credibility in the eyes of the general public. It is for those reasons, in addition to those that I stated above, that I have chosen to partially depart from the guidance given by the East African Court of Appeal in the case of APC Lobo & Another.

It is evident from these proceedings that in particular, Mr. Fred Muwema misbehaved in such a despicable manner throughout the proceedings. Most importantly, Mr. Fred Muwema happens to be the author of the champertous agreement that was in contest in this appeal. And before that he was the mastermind behind a similar agreement which was the subject of the proceedings in M/A 376/2007, M/s Muwema & Mugerwa, Advocates v. Uganda Revenue Authority, and which arose out of a similar representative action, O.S. 10/2007, Kagoro Friday Roberts & Sempa Matovu B. E. v. URA, “the road licence fee refund case.” The result of that suit was that Ushs. 1,389,888,465/=, which was part of monies meant for refunds of road license fees to about 50,000 taxpayers in Uganda, was erroneously paid to the 3rd respondent firm on the basis of a champertous agreement similar to that which was contested here.

I am sure that several of the persons that will have the benefit of reading this judgment were deprived of substantial portions of their license fee refunds on account of professional fees, illegally and in abuse of the process of this court, deducted therefrom by the Advocates from the 3rd respondent firm. In addition to the above, these proceedings have shown that Mr. Muwema participated in several other offences under the Advocates Act and contravened several provisions of the Advocates (Professional Conduct) Regulations and the Advocates (Remuneration & Taxation of Costs) Rules, which I have taken the pains to particularize in this judgment.

And as if to add insult to injury, Mr. Muwema challenged my authority as a judicial officer on two occasions during the course of these proceedings, one of them in a fully packed courtroom. What he uttered then in the courtroom was loaded and was, without a doubt in my mind, intended to insult me. He had before that participated in dragging my name in the mud by lodging an unfounded complaint against me with the Principal Judge. Most probably because he feared that his nefarious activities had been discovered, he in various ways sought to dismiss me from hearing the case against his firm. Too, Mr. Muwema appears to be the Senoir partner in his firm. Finally, the said Advocate showed no remorse whatsoever for his unbecoming conduct during the whole course of the proceedings.

I do hereby acknowledge the efforts of Mr. Muwema’s partner, Mr. Herbert Kiggundu Mugerwa to approach me and make a formal apology on behalf of his colleagues. However, I could not give Mr. Mugerwa audience when he requested to do so because of the previous allegations of bias levelled against me in these proceedings. The proceedings were still sub judice and the advocates from the 3rd respondent firm were parties thereto. It would have been imprudent, indeed improper for me to entertain any of them in the absence of the advocates of the other parties to this appeal.

Moreover, the apology proposed by Mr. Mugerwa could not cover Mr. Muwema because it is the conduct of an advocate that is always relevant to the question of his fitness to practice, and one advocate’s misconduct cannot be attributed to another {Emomeri v. Shell (U) Ltd [1999] 1 EA 72}. Similarly, an apology proffered by one advocate cannot be that of another and cannot bind him/her. If Mr. Kiggundu Mugerwa still desires to do so, he may make a formal apology to court before it rises today. In the alternative, if he still desires to do so, he may present an apology to me in writing about his own conduct.

But in the meantime, for the reasons that I gave at the begining of this judgment about the goals and functions of the Commercial Court regarding the establishment and training of an ethical Commercial Bar, I find that Mr. Fred Muwema is not a fit and proper person to continue practicing on the Commercial Bar. Therefore, as the Deputy Head of this Court, and by virtue of the powers vested in the court by s. 98 of the Civil Procedure Act, which are saved by s.17 Advocates Act, Mr. Fred Muwema is hereby suspended from practicing in the Commercial Court. Such suspension will hold until disciplinary proceedings are commenced against Mr. Muwema, heard and taken to their logical conclusion by the Disciplinary Committee of the Uganda Law Council. By copy of the records of proceedings in M/A 622/2010, M/A 625/2010, M/A 646/2010 and this appeal, as well as this judgment, the Chief Registrar is hereby directed to prepare a report for onward transmission to the Uganda Law Council for further appropriate action against Mr Fred Muwema.

 
In conclusion, this appeal succeeds on all grounds with the following orders:-

i)      

It is hereby declared that the fee agreement entered into between the 1st respondent and the 3rd respondent firm on 01/09/2009 for remuneration in O.S 009/2009 was illegal and therefore null and void.

ii)     
The charging orders issued by the Deputy Registrar of this court on the 15/11/2010 in M/A 622/2010 based on the said fee agreement and in favour of the 3rd respondent firm are hereby set aside.

iii)    
The 3rd respondent firm is not entitled to any fees per agrement, or to costs in respect of prosecuting O.S 009/2009 and M/A 622/2010, due to the misconduct that they displayed before the filing of O.S 009/2009 and in the subsequent proceedings to recover their alleged fees, per agreement with the 1st respondent.

iv)     
Mr. Fred Muwema is hereby suspended from practicing before the Commercial Court till a complaint about his misconduct in these proceedings and in respect of fees for O.S 009/2009 is lodged by the Chief Registrar before the Disciplinary Committee of the Uganda Law Council, and heard to its final conclusion.

v)      
The costs of this appeal and M/A 625/2010 shall be paid by the 3rd respondent, in any event, and there shall be a certificate for the costs of the 3 advocates who represented the appellants in this appeal, and in M/A 625/2010.

Irene Mulyagonja Kakooza
JUDGE

22/12/2010