Court name
Commercial Court of Uganda
Judgment date
12 April 2012

Central Electricals International Ltd & Anor v Prestige Investments Ltd (Miscellaneous Application-2011/625) [2012] UGCommC 22 (12 April 2012);

Cite this case
[2012] UGCommC 22
Coram
Obura, J

THE REPUBLIC OF UGANDA

IN THE HIGH COURT OF UGANDA AT KAMPALA

[COMMERCIAL DIVISION]

MISCELLANEOUS APPLICATION NO.625 OF 2011

(Arising from H.C.C.S. No. 333 of 2008)

 

  1.                                                                              CENTRAL ELECTRICALS  INTERNATIONAL

                                                                                               LTD & ANOR     ::::::::::::::::::::::::::::: APPLICANT/1ST COUNTER DEFENDANT

  1.                                                                                     SAMUEL SEBIDE SENTONGO:::::::::::APPLICANT/2ND COUNTER DEFENDANT

 

VERSUS

 

                                                                                            PRESTIGE INVESTMENTS LTD::::::::::::::::::::::: RESPONDENT/COUNTER CLAIMANT

 

BEFORE: HON. LADY JUSTICE HELLEN OBURA

 

RULING

 

The applicant brought this application by Notice of Motion under the provisions of Order 8 rules 8, 9 & 19, Order 9 rule 10, Order 5 rules 1 (3) (a), (b), (c) & 32, Order 6 rules 23 & 25 and Order 52 rules 1 & 3 of the Civil Procedure Rules (CPR).  The applicant is seeking for orders that the amended Written Statement of Defence (WSD) and counter-claim be struck out and the respondent’s/counterclaimant’s amended counter claim be dismissed with costs and that the main suit proceeds in default of the defendant filing a defence.

 

The application is supported by the affidavit of Ms. Kembabazi Annet dated 2nd November 2011. In paragraphs 2-5 she states that the respondent was on 5/10/2011 allowed by this court to amend its WSD and add M & E Associates Ltd as a 3rd counter-defendant. A copy of the order was attached as “A”. Further that the respondent was also directed to file and serve the amended WSD within 15 days and in any event by 20/10/2011, which was never done within the time limited by the court.

 

Affidavits in reply were sworn by Mr. Katende Godfrey a clerk in the law firm of M/S Ntende, Owor & Co. Advocates and Mr. Charles Owor an advocate in the same firm. Katende in his affidavit stated that on 20th October 2011, he received from his superiors an amended WSD and counterclaim for filing and he proceeded to file the same at the Commercial Court Registry as instructed. Further that after the documents were received and stamped at the registry he was advised to take them for assessment of court fees which he did and proceeded to the bank but by the time he completed the process it was close to 5.00 pm.

 

He deposed that the process of paying fees in the bank was not completed until Monday 24th October 2011 when he was given a receipt which he returned to the court registry and the pleadings were endorsed and returned to him for service. Further that he served the same on 25th October 2011.

 

Mr. Charles Owor on his part deposed that when this court granted leave to the defendant/counter-claimant to file and serve an amended WSD and counterclaim, their client went to their office several times to remind them about the limited period within which they had to file the amendment. Further that due to power outages in their office locality they were only able to complete the amendments on the deadline date. That consequent upon that, they were only able to file it on the last day of the order, that is, on 20th October 2011 and the court registry duly received the same. From paragraphs 5-7 he repeated what was allegedly done by Mr. Katende as stated in his affidavit.

 

He deposed that given that the defendant tried, against all odds, to file the amended WSD and counterclaim within the time ordered there was willingness to subscribe to the jurisdiction of this court and to ensure the ends of justice are met. Further that the defendant/counter-claimant did not default in filing an amended WSD and is not to blame for the failure of the lawyers and ought not to be penalised for such failure.

 

He concluded that the justice of this case requires that the substance of the dispute be investigated and decided on merit and any lapse on their part ought not to bar the defendant/counter-claimant from pursuing the remedy it seeks.

 

When this application was called on for hearing on 5th December 2011, the applicants were represented by Mr. Simon Tendo Kabenge and the respondent by Mr. Frederick Samuel Ntende. Mr. Ntende informed court that he was not prepared to proceed with the application and besides he had another matter in Buganda Road Court to attend to. He prayed for an adjournment to enable him attend to the matter in Buganda Road Court and also prepare to argue this application. Although his prayer was strongly opposed by counsel for the applicants, this court felt constrained to grant the same purely in the interest of justice.

 

The matter was then adjourned to 13th February 2012 for hearing. On that day, neither the official of the defendant/counter-claimant nor counsel appeared and no explanation was furnished to court. Counsel for the applicants applied to proceed ex-parte and he was allowed to do so. He then informed court that he had already filed a written submission and requested court to consider the same so that the matter is just fixed for a ruling. Court agreed to consider the same and the matter was fixed for ruling.

 

I wish to note with concern that as I was preparing this ruling I came across a document on the court record purporting to be the respondent’s submission filed on 21st March 2012. I do not know the basis on which it was filed given that this court had made an order that this matter proceeds ex-parte which order had not been reviewed or set aside. In Misc. Application No. 624 of 2011, M & E Associates v Prestige Investments Ltd at page 4 I criticized this casual and unprofessional manner of conducting court business by counsel for the defendant and I still do so more strongly now.  Of course I disregarded that submission because it was irregularly filed. 

 

The applicants’ counsel submitted that the law on amendments especially when it introduces a counter-claim is very strict on filing and serving of the counter claim.  This law is found in Order 6 r 23 of the CPR which provides that amendments are to be filed within the time allowed and duplicate served in the manner provided for in the service of summons.  The manner provided for in the service of summons is under Order 8 r19 and Order 5 rules 2 & 3.

 

He relied on the case of Nile Breweries Ltd v Bruno Ozunga t/a Nebbi Boss Stores (C.S 0580-2006) [2008] UG Commercial Court 23 (unreported but on the judiciary website).  He submitted that in that case the learned judge was faced with a similar situation and he interpreted the relevant laws on amendment, filing and service of WSD/counterclaims.

 

He submitted that the gist of that case is that once court has given an order and specified the date then both the filing and service of the amendment must be effected within the dates specified by court. That is what Order 8 rule 19 provides.  Further that the consequence of not doing that is provided for under Order 6 rule 25.  It provides for failure to amend, file and serve within the time limited for that purpose by the order unless there is extension of time.  He noted that in this case the time has never been extended.  Under Order 5 rules 1, 2, and 3 (c) the counterclaim should be dismissed without notice with costs to the 3rd counter-defendant.

 

He contended that the affidavit in reply showed dilatory conduct by the respondent.  He contended that in paragraph 3 of the affidavit of Mr. Charles Owor, he attributed statements and actions to the Managing Director (MD) of the respondent which if true indeed show dilatory conduct on the part of the respondent and the advocates.  It states that he kept going there to remind the advocates to file the amended WSD and counter claim.

 

He argued that the MD did not even file a supplementary affidavit to substantiate what was stated.  He noted that generally paragraphs 2 and 3 of that affidavit are admissions of the applicant’s case regarding the time within which the amendment was to be filed and served which they were all along aware of.  He contended that paragraph 4 of the affidavit is a lie because the deponent averred that the amended WSD was filed and received in the court registry on 20/10/2011 but he did not even attach a copy of the same.

 

Further that it is also a lie that the same was received in the registry on 20th October 2011 because the payment of fees on the WSD is dated 24th October 2011 and indeed the Registrar of the court confirms this on page 7 of the purported amended WSD when he confirms that it was lodged in the registry on the 24th October 2011. He argued that the allegation that it was filed on 20/10/2011 is borne of fraud and backdating as a pleading is never filed until it is paid for. 

 

He contended that Mr. Owor told a lie when in paragraph 6 to 8 of his affidavit he relied on hearsay and stated that the defence was filed “against all odds”. He wondered what the odds were because the court gave very specific time. Further that he also told another lie in paragraph 13 of his affidavit where he stated that whatever is stated therein is true and correct to the best of his knowledge, when paragraphs 5, 6 and 7 are clearly based on the hearsay got from Katende and paragraphs 8, 9, 10 and 11 are based on his beliefs and not knowledge.  He submitted that those are lies that offend Order 19 on affidavits.

 

He referred to the case of Eric Tibebega v Fr. Narensio Begunisa and Others Supreme Court Civil Application No. 18/202 where JSC Kato  at page 13 held that:-

 

“In view of the fact that the affidavit in support of this application is riddled with falsehoods and it is a mere hearsay, I find that the application has not been supported by a valid affidavit. That being the position, there is no evidence to establish that the Applicant had sufficient reasons which prevented him from filing on time”

 

As regards the affidavit of the clerk, he pointed out that in paragraph 3 the deponent stated that he filed the document yet in paragraph 4 he again stated that he was advised to pay court fees but did not attach the alleged assessment that he was advised to get.  He argued that even if the document was received and stamped by the court registry it was backdated because there was simply no filing as no court fees had been paid.

 

He submitted that the filing was done on 24/10/2011 as per paragraph 6 of the affidavit of the clerk when the documents were placed on the court file.  However, he contended that given that service has never been effected in the time limited by the court there is no filing at all. He submitted that the alleged service as stated in paragraph 7 of the clerk’s affidavit is not supported by evidence of service.

 

He also referred to the case of Ndaula Ronald vs. Hajji Naduli Abdul & Anor. Electoral Petition Appeal No. 20/2006, at pages 4, 5, 9, 11 and 12. He submitted that that case is an authority on the fact that a document is not filed in court until court fees is paid and once fees are paid outside time allowed then there is no filing of the document.  The same decision also states that a document filed without payment of fees is an illegality and supersedes all matters of procedure and must be struck off as was done in that case. 

 

He pointed out that even when the alleged payment was made on 24/10/2011, there is still a worse problem in that a fee of shs.3,000/= was paid for a counterclaim of USD 55,763.  He submitted that the Shs. 3,000/= was not the fee for that counterclaim.  Further that under Rule 4 and Part III of the schedule to the judicature (Court Fees) Rules S.1 13-1 in a suit (which the counterclaim is) where the amount involved is US Dollars the counterclaim is for Shs.161,712,700/= the filing fees would be  Shs.258,712.7 and  not  Shs.3,000/=.

 

He invited this court to adopt that authority and find that there was no filing at all and the non-payment of appropriate fees made the WSD and counterclaim an illegality.  He also invited this court to find that the WSD and counterclaim was filed on 24th October 2011, four days outside the time allowed by the Court.  He therefore prayed that this Court be pleased to grant the orders prayed for with costs.

 

Before I consider the merit of this application, I wish to first deal with the issues raised concerning the affidavits in reply particularly the one sworn by Mr. Charles Owor. It is alleged that that affidavit contains both falsehood and hearsay and so it should be struck out. Secondly, that the deponent stated in paragraph 13 that whatever is stated therein is true and correct to the best of his knowledge when actually the information in paragraphs 6 to 8 were got from Mr. Katende Godfrey.

 

I do not seem to see the lie that counsel is referring to. However, I agree that Mr. Owor should have distinguished the paragraphs based on information from those based on his knowledge and belief. If he had acknowledged the source of information then it would not be hearsay.

 

Be that as it may, in the recent past the Supreme Court has adopted a more liberal approach to dealing with defective affidavits. The offending paragraphs can now be safely severed from the affidavit and the rest of the paragraphs accepted. In the case of Col. (Rtd) Besigye Kizza v Museveni Yoweri Kagutta & Electoral Commission (Election Petition No. 1 of 2001) [2001] UGSC 3, Odoki B.J. (Chief Justice) in his lead judgment stated as follows;

 

“In Reamation Ltd. V UGANDA Corporation Creameries Ltd. and Another Civil Application No. 7 of 2001, Motor Mart (U) Ltd. v Yona Kanyomozi Civil Appeal No. 6 of 1999 andYona Kanyomozi v Motor Mart (U) Ltd. No. 8 of 98, the Supreme Court adopted a liberal approach to affidavits. In Yona Kanyomozi v Motor Mart (U) Ltd (supra) Mulenga JSC, held that some parts of counsel’s affidavits were false and that those parts were irrelevant to the application and could be ignored. On a reference to the full Court, it was argued that the impugned affidavit was capable of severance as the single judge did before arriving at his decision. The full court held that it was unable to interfere with the discretion exercised by the single judge.

From the authorities I have cited there is a general trend towards taking a liberal approach in dealing with defective affidavits. This is in line with the constitutional directives enacted in Article 126 of the Constitution that the courts should administer substantive justice without undue regard to technicalities. Rules of procedure should be used as handmaiden to justice but not to defeat it”.

 

Meanwhile,inGreenwatch v Attorney General and Another (2003) 1 E.A. 87, Mukasa J, held that knowledge can be acquired through human senses like seeing, hearing, smelling, tasting or touching followed by understanding and perceiving what one has sensed.

 

I am alive to the fact that there are also authorities that adopt a rigid approach to defective affidavits. One of such is the case of Eric Tibebega (supra) that counsel for the applicant relied upon. Another one is Sirasi Bitaitana and 4 others v Emmanuel Kananura [1977] HCB 34 where Allen J, held that;

 

  1. “The inconsistencies in an affidavit cannot be ignored however minor, since a sworn affidavit is not a document to be treated lightly. If it contains obvious falsehood then it all naturally becomes suspect.
  2. An application supported by a false affidavit is bound to fail because the applicant in such a case does not go to court with clean hands and tell the truth”. (Emphasis added).

 

That ruling was followed in the case of Nathan Katamba v Stephen Kabigyema [2000] KALR 780 where Musoke Kibuuka J, held that;

 

“Affidavits are very serious documents. Once one contains a falsehood in one part, the whole becomes suspect. An application supported by a false affidavit is bound to fail. The applicant has not come to this court with clean hands. The affidavit in support is struck out. The motion remains unsupported by any kind of evidence and is therefore valueless”.(Emphasis added).

 

As I observed in the case of Sam Aniagyei Obeng & Anor v MTL Real Properties Ltd & Anor, Miscellaneous Application No. 198 of 2011 (arising out of Civil Suit No. 53 of 2010), this court is bound to follow the liberal approach adopted by the Supreme Court. In the circumstances, I will only sever the offending paragraphs of Mr. Owor’s affidavit and accept the rest of the paragraphs.

 

 

 

Turning to the merit of this application, its background is that upon an oral application, this court granted leave to the defendant/counter-claimant now respondent to add M/S M & E Associates Ltd as the 3rd counter-defendant to its counter-claim. An order was then made that the defendant/counter-claimant amends its WSD and counterclaim and serves within fifteen days from 5th October 2011 when the order was made.

 

From the affidavits on record, it is clear that the defendant/counter-claimant did not comply with that order within the prescribed time. There were attempts by counsel for the defendant/counter-claimant to sugar-coat what happened as stated in the affidavits in reply but the bottom line is that the order was not complied with within time. In that context, I wish to point out that this case is distinguishable from that of Nile Breweries Ltd (supra) where filing of the amended WSD and counterclaim was done in time but service was not effected. The issue was therefore whether or not filing had been completed in the absence of service. The rules were also discussed in that context.

 

In the instant case the explanation of how the clerk brought the document to the court registry for filing on the last day and the same was received and advice made that fees be paid, in my view, is stating the obvious. Every lawyer ought to know that documents are only validly filed upon payment of court fees. There are many authorities to that effect. See the case of Babihuga Winnie v Matsiko Winfred, Election Petition Application No. 14 of 2002 where the Court of Appeal held that documents are properly filed in court after payment of court fees. See alsoNdaula Ronald (supra) and Pinnacle Projects Ltd v Business in Motion Consultants Ltd, Miscellaneous Application No. 362 of 2010 where this court quoted with approval the observation of Goudie, J in UNTA Exports Ltd v Customs [1970] EALR 648 at page 649 that;

 

“I have no doubt whatsoever that both as a matter of practice and also as a matter of law documents cannot validly be filed in the civil registry unless fees have been paid or provided for by a general deposit from the filing advocate from which authority has been given to deduct court fees”.

 

In view of this settled principle of law, the explanation on how efforts were made to file the amended WSD and counterclaim on the last day is not acceptable to this court as it serves no useful purpose. I would have probably been sympathetic if the explanation was made by an unrepresented party who does not know the court procedure. Consequently, I find that the amended WSD and counterclaim was filed on the 24th October 2011 when it was lodged at the court registry and sealed by the Registrar after the court fees were paid. The endorsement made on the 20th October 2011 was therefore irregular since court fees had not been paid.

 

As regards the effect of failure to comply with the timeline, I have addressed my mind to the provisions of Order 6 rule 25 of the CPR but before I relate it to this case I wish to point out that a clear distinction must be made between the time prescribed by the rules and one given by an order of court. While the time prescribed by the rules can sometimes be treated as mere technicality which can be ignored in terms of Article 126 (2) (e) of the Constitution, depending on whether it is stated in mandatory terms or not, the Court of Appeal has held that a court order must be obeyed unless set aside or varied. This was the holding in the case of Amrit Goyal v Harichand Goyal & 3 others (Civil Application No. 109 of 2004 [2008] UGCA 6 (7 August 2008).

 

In that case, upon an application by the applicant who was the successful party in the High Court, the respondent who had appealed against the judgment and order of the High Court was ordered by a Single Justice of Appeal to deposit Shs. 80,525,500/= as security for costs within 30 days from the date of her order and in any case before the hearing date of the appeal. The appeal had been fixed for hearing on 18th May 2004 and the ruling was delivered on 29th April 2004.

 

The respondent did not comply within the prescribed time and did not even apply for extension of time. The applicant applied to have the Notice and Memorandum of Appeal struck out on that basis and their Lordships held that:-

 

“A court order is a court order. It must be obeyed as ordered unless set aside or varied. It is not a mere technicality that can be ignored. If we allowed court orders to be ignored with impunity, this would destroy the authority of judicial orders which is the heart of all judicial systems……………….From what we have just stated above, we hold a firm view that a court order is not a mere technical rule of procedure that can be simply ignored. In our jurisprudence, court orders must be respected and complied with. Those who choose to ignore it do so at their own peril”.

 

I am not at all impressed by the reasons for the defendant/counter-claimant’s failure to file the amended WSD and counterclaim in time as stated in the affidavits in reply. Surely, could there have been power outages for the entire period of fifteen days! Even if one were to believe that, could counsel not find alternative ways of typing the pleadings so as to file it in time?  To my mind that was shear ineptitude on the part of counsel.

 

Ordinarily I would have been inclined to out rightly grant this application and strike out the amended WSD and counterclaim that was clearly filed out of time. However, in the interest of justice I will consider what was stated in paragraphs 10 and 11 of Mr. Owor’s affidavit before I make my final decision on this application.

 

Mr. Owor stated in those paragraphs of his affidavit that the failure to file the amended WSD and counterclaim was occasioned by failure of their law firm and so the respondent should not be penalized because he had no control over their action. He further stated that the justice of this case requires that this dispute be investigated and decided on merit.

 

It is now a settled principle of law in our jurisdiction that mistakes of counsel however negligent should not be visited on a litigant. In Banco Arabe Espanol vs. Bank of Uganda SCCA No. 8/1998 [1997-2001] UCL 1,Oder, JSC (RIP), while giving the background to the development of this principle stated that:-

 

“The question of whether an “oversight”, ‘mistake”, “negligence”, or “error”, as the case may be, on the part of counsel should be visited on a party the counsel represents and whether it constitutes “sufficient reason” or “sufficient cause” justifying sufficient remedies from courts has been discussed by courts in numerous authorities. Those authorities deal with different circumstances; and may relate to extension of time for doing a particular act, frequently in cases where time has run out; some of them concern setting aside an ex parte judgment or reinstating a dismissed suit such as in the present case. But they have a common feature whether a party shall, or shall not, be permanently deprived of the right of putting forward a bona fide claim or defence by reason of the default of his professional advisor or advisor’s clerk.”

 

As seen from that background, the rationale behind that principle is that a litigant should not be permanently deprived of the right of putting forward a bona fide claim or defence by reason of the default of his professional advisor or advisor’s clerk. This principle was therefore established in the interest of substantive justice.

 

There are many other authorities in Uganda where this principle was stated with approval. They include; Hajji Nurdin Matovu vs. Ben Kiwanuka SCCA No. 12 of 1991 (Unreported), AlexanderJo Okello vs. Kayondo & Co. Advocates SCCA No. 1 of 1997 (Unreported) andAndrewBamanya v Shamsherali Zaye CAC Application No. 70 of 2001, whereMukasa-Kikonyogo, DCJ (as she then was) observed that mistakes, faults, lapses or dilatory conduct of counsel should not be visited on the litigant.

 

Applying that principle to the instant case, the firm of M/S Ntende, Owor & Co. Advocates was instructed to represent the respondent/defendant/counter-claimant in this matter. As a client it does not have control on how the instructions are carried out because the lawyers as legal experts/professional advisors are presumed to know the law, procedures and practice of court. The respondent/defendant/counter-claimant cannot therefore be faulted for the mistakes of its counsel.

 

This court has been requested to strike out the amended WSD that was filed out of time so that the matter proceeds in default of filing a WSD. This, in my view, would amount to visiting the mistake of counsel on a litigant which is contrary to the above stated principle and the rationale behind it. I am also of the view that striking the amended WSD and allowing the matter to proceed in default of filing a WSD will not serve the best interest of justice and expediency since the respondent will still be at liberty to file other applications to seek redress. It would therefore instead just lead to multiplicity of suits a mischief that section 33 of the Judicature Act seeks to address.

 

I have also looked at the nature of dispute in the main suit and I believe it can be best resolved if all the concerned parties are brought on board. In any case, counsel for the applicant did not address me on the prejudice that would be occasioned to his client if this application is not allowed. I do not personally see any prejudice that would be occasioned to the applicant/plaintiff if the time for filing the amended WSD is extended so as to validate the filing of this pleading which is already on court record. In any case, the provisions of Order 6 rule 25 of the CPR, in my view, permit extension of time by court after the time allowed has expired.

 

In the circumstances, I am inclined on my own motion to exercise the power given to this court by section 98 of the Civil Procedure Act and section 33 of the Judicature Act to enlarge the time for filing the amended WSD. Consequently, the amended WSD and counterclaim that was filed on 24th October 2011 is validated and I order that it should be served on the plaintiff/counter-defendants within seven days from today. On the issue of the amount of fees paid, I order that the correct amount be paid in accordance with the rules that govern payments of court fees.

 

Costs of this application are awarded to the applicants and it shall be paid by counsel for the respondent personally because his failure to act in time for no justifiable reason gave rise to this application. The costs shall be paid before the scheduling conference which had already been fixed for 25th April 2012.

 

I so order.

Dated this 13th day of April 2012

 

Hellen Obura

JUDGE

Ruling delivered in chambers at 3.00 pm in the presence of Mr. Simon Tendo Kabenge. There was no representation for the respondent as the application proceeded ex-parte.

 

 

 JUDGE

13/04/2012