Court name
Commercial Court of Uganda
Judgment date
5 July 2011

Dembe Trading Enterprise Ltd. v Global Electrical & Electrinics Ltd. (Miscellaneous Application-2011/202) [2011] UGCommC 64 (05 July 2011);

Cite this case
[2011] UGCommC 64
THE REPUBLIC OF UGANDA
IN THE HIGH COURT OF UGANDA AT KAMPALA
(COMMERCIAL DIVISION)
MISCELLANEOUS APPLICATION NO. 0202 OF 2011

[ARISING FROM CIVIL SUIT NO. 0224 OF 2009]

                  DEMBE TRADING ENTERPRISES LTD.::::::::::::::::::::::::APPLICANT


 
VERSUS


GLOBAL ELECTRICAL       
& ELECTRONICS LTD        :::::::::::::::::::::::::::::::::::::RESPONDENT



BEFORE: HON. LADY JUSTICE IRENE MULYAGONJA KAKOOZA
RULING
The applicant was the plaintiff in Civil Suit No. 244 of 2009 in this court, wherein she claimed shs. 303,792,000/= on account of goods supplied on credit to the defendant, now the respondent. She brought this application under the provisions of Order 13 rule 6 for judgment on admissions against the respondent in that suit.
The application was supported by an affidavit deposed, by Fiona Uwera, the Business Manager of the applicant, on 15/04/2011. The respondent filed no affidavit in reply but was represented by Mr. Yese Mugenyi at the hearing of the application. For purposes of this application, I shall continue to refer to the parties as the plaintiff and defendant as designated in the main suit.
In her affidavit in support of the application, Ms. Uwera stated that the plaintiff sued the defendant to recover monies outstanding, together with interest on a contract for the supply of goods, Annexure
“A” to the affidavit in support. That in paragraphs 3 of the WSD, the defendant admitted liability for shs. 280,000,000/=. Attached to the WSD was Annexure “A” a document referred to as an undertaking, wherein it was promised that shs. 280m would be paid from daily cash sales from the defendant company.
Before the hearing of the application could proceed, Mr. Yese Mugenyi informed court that he had instructions to concede to judgment being entered for shs. 128m because that is what was stated in the plaint attached to the affidavit in support, but he did not understand how the amount of shs. 280m named in the application came about. Court explained that actually, the plaint attached to the application was the original filed in court, but on 3/06/2010, an application was made before Arach Amoko J (as she then was) to amend the plaint to make the total amount claimed shs. 303, 792,000/=. That the application was allowed and the amendment was endorsed on the copy of the plaint on record. Mr. Mugenyi then conceded that the plaint was so amended and he was in court when the application was granted. Ms. Jivram then proceeded to argue the application.
In her submissions, Ms Jivram stated that there is no doubt that paragraph 3 of the WSD contained an admission that the defendant owed shs. 280m to the plaintiff. That the undertaking attached to the WSD was a confirmation of the said admission. That the defendant had not paid any monies to satisfy the debt and the whole of it was still outstanding. She relied on the decision in the case of
Zimwe Enterprises Hardwares v. John Sentongo HCCS 909 of 1997 where the import of Order 13 rule 6 was laid out; that the provision allows a party to a suit where the other party has admitted the facts of the case to apply for judgment or orders consequent upon the admission, without waiting for a full trial. She went on to rely on the decision in Grofin East Africa Ltd & DFCU v. Joan Traders Ltd & Hellen Kakyo, UCC Civil Suit No. 268 of 2008, for the submission that such admission should be clear and unequivocal so as to entitle the applicant to judgment. She then concluded that in the instant case, the defendant had clearly and unequivocally admitted a part of the claim, and the plaintiff was entitled to judgment for the sum admitted without waiting for any further steps in the proceedings.
In reply, Mr. Mugenyi challenged the contents of Annexure
“A” to the WSD for the reason that it was not clear whether the person who signed it did so in his personal capacity or for the company. Relying on Ms. Jivram’s submission that the admission should be clear and unequivocal, he prayed that court considers whether the undertaking was binding on the company.
Order 13 rule 6 CPR provides that:
Any party may at any stage of a suit, where an admission of facts has been made, either on the pleadings or otherwise, apply to the court for such judgment or order as upon the admission he or she may be entitled to, without waiting for the determination of any other question between the parties; and the court may upon the application make such order, or give such judgment, as the court may think just.”
 
The Court of Appeal of Uganda had occasion to discuss the provision above in Kibalama v. Alfasan Belgie CVBA [2004] 2 EA 146. The Justices of the Court were unanimously of the opinion that under Order 11 rule 6, which is now Order 13 rule 6, judgment can be entered at any stage of the suit where an admission of facts has been made. That such an admission however, must be unequivocal in order to entitle the party to judgment without waiting for the determination of any other question between the parties.
        
In Momanyi v. Hatimy & Another [2003] 2 EA 600, the Court of Appeal of Kenya discussed the provisions of Order 12 rule 6 of the Kenya CPR which was then equivalent to our Order 11 rule 6. The court reproduced, with approval, an excerpt from Choitram v. Nazari [1984] KLR 327 where it was held that:
“Admissions have to be plain and obvious, as plain as a pikestaff and clearly readable because they must result in judgment being entered. They must be obvious on the face of them without requiring a magnifying glass to ascertain their meaning. Much depends on the language used. The admission must have no room for doubt …”
Although the above is a decision of the Court of Appeal of Kenya, its effect is no different from the decision in Kibalama v. Alfasan Belgie CVBA (above).                        
I carefully perused the plaint and WSD in this suit. The plaintiff’s claim in paragraph 4 (c) of the plaint was that pursuant to an arrangment between the parties, the plaintiff supplied goods to the defendant worth shs. 303,709,000/=. A statement of the defendant’s account with the plaintiff was attached to the plaint as Annexure “B.” The plaintiff claimed that the defendant had failed to pay the amount claimed to the plaintiff and so the suit. On the other hand, in a poorly framed paragraph 3 of the WSD the defendant pleaded as follows:
“3. The defendant shall raise a preliminary objection to the effect that the instant suit is frivolous, vexatious, does not disclose a reasonable cause of action against the defendant and is an abuse of court process hence it ought to be struck out with costs to the defendant because on the 1st day of July 2009 the plaintiff made an undertaking with the defendant whereof the later (sic) admitted indebtedness to a (sic) tune of Ug. Shs. 280,000,000/= (Two hundred eighty million shillings only) and that it would pay the said debt using money from daily cash sales of the defendant company. In consideration of this, the defendant would pay interest of 15% more if it defaulted. A photocopy of the said undertaking is attached hereto and marked Annexure “A”. That to date, the defendant continues to make payments towards the said debt which the plaintiff acknowledges.”
It was never clarified by the defendant how the plaintiff acknowledged said repayments but the defendant went on to plead in paragraph 8 of the WSD, this time omitting to state that the plaintiff acknowledged payment of the sums repaid as follows:-
“8. In the alternative but without prejudice to the above, the defendant shall aver and contend that on the 1st day of July, 2009, it entered into an undertaking with the defendant whereof the Plaintiff (I think defendant) admitted its indebtedness to a (sic) tune of Ug. Shs. 280,000,000/= (two hundred eighty million shillings only) and undertook to repay the above said loan from the daily cash arising from the company sales and that as consideration, the defendant would pay 15% interest if the said money is not paid.”
It is important to note that although the defendant pleaded that she was making payments to reduce her indebtedness in the paragraphs 9 and 10 of the WSD, and that she would adduce evidence of receipts and invoices at the trial, when this application was made, she filed no affidavit in reply and therefore offered no challenge. The half hearted defence to the application offered by Mr. Mugenyi in his submissions was that Annexure “A” (the undertaking to pay up to shs. 280m with interest) could have been signed by one Mohammed Imtiaz in his personal capacity and not for the company. It is therefore pertinent to examine the contents of that document for its full contents and effect and I will reproduce its contents here.
1/07/09
Undertaking
I, Imitiaz Muhammed being indebted to Dembe Trading Enterprises Ltd. to the tune of 280,000,000/= (Two hundred eighty million shillings only) and having failed to honour the previous undertaking 10/03/2009 agree to pay interest of 15% more if I continue to default.
I undertake to pay daily cash from sales from my company which am a director (Global Electrical and Electronics)

Signed by :      Signature
Names:            Mohammed Imtiaz
Witness By:      Pam B, ……
                 

In the undertaking above, Mohammed Imtiaz stated that he was a director in the company, Global Electrical & Electronics Ltd. That fact was not denied by the defendant because in paragraphs 3 and 8 of the WSD defendant fully owned the document and its contents without any complaint about the person that signed it on behalf of the company. In addition to that in paragraph 9 of the WSD, the defendant stated that the undertaking was still binding on both parties. However, though defendant also pled in the same paragraph that payments were being made to honour the agreement, no affidavit was filed to rebut the facts stated in the affidavit in support of this application, meaning that they were all true. I therefore came to the clear conclusion that no payment had been made to the plaintiff since the signing of the undertaking, as was alleged in paragraphs 3 and 9 of the WSD.
The defendant is therefore both by her pleadings and her failure to respond to this application estopped from denying the validity of the undertaking to pay, as stated therein. Her admission was clear, “
plain and obvious, as plain as a pikestaff and clearly readable,” both from the pleadings and the undertaking. It must therefore result into judgment without waiting for the determination of any other question between the parties, as is provided for by Order 13 rule 6 CPR.
In conclusion, judgment on the said admission is hereby entered in favour of the plaintiff for shs. 280,000,000/= with interest thereon at the rate of 15% from the date of the undertaking (i.e. 01/07/2009) till payment in full. The suit shall now be set down for hearing with regard to the balance of shs. 23,792,000/= and costs of this application shall be borne by the defendant.



Irene Mulyagonja Kakooza
JUDGE
06/07/2011