Court name
Commercial Court of Uganda
Judgment date
11 November 2013

Kibirige Lutwama v Kato (Miscellaneous Application-2013/920) [2013] UGCommC 189 (11 November 2013);

Cite this case
[2013] UGCommC 189

THE REPUBLIC OF UGANDA,

IN THE HIGH COURT OF UGANDA AT KAMPALA

(COMMERCIAL DIVISION)

MISCELLANEOUS APPLICATION NO 920 OF 2013

(ARISING FROM HCMA NO 651 OF 2013)

ANDREW KIBIRIGE LUTWAMA}..........................................................                                                                                  APPLICANT

 VS

HARUNA KATO}..............................................................................                                                                                         RESPONDENT

BEFORE HON. MR. JUSTICE CHRISTOPHER MADRAMA IZAMA

RULING

The Applicant's application is commenced under section 33 of the Judicature Act, section 98 of the Civil Procedure Act and Order 44 rules 2, 3 and 4 of the Civil Procedure Rules for orders that the Applicant is granted leave to appeal against the orders in Miscellaneous Application Number 651 of 2012 and for costs of the application to be provided for.

The grounds of the application as contained in the notice of motion is firstly that the Applicant is aggrieved with the ruling and orders of this court delivered on 11 October 2013. Secondly Miscellaneous Application Number 651 of 2013 was brought under Order 36 rule 3 and 4 of the Civil Procedure Rules which is special provision of the rules and is not covered under Order 44 rule 1 of the Civil Procedure Rules which gives the automatic right of appeal from certain orders. Thirdly the Applicant filed a notice of appeal from the decision of the court. Fourthly the order to be appealed against does not lie as of right. Fifthly the order as decreed by the honourable court involves huge sums of money and if leave is not granted it would prejudice the pending appeal of the Applicant. Sixthly it is essential for leave to appeal to be granted. The seventh ground is that the Applicants intended appeal has tenable points of law. Lastly the Applicant avers that it is just and equitable that the application is granted.

The application is supported by the affidavit of the Applicant which gives the facts in support of the notice of motion. The Applicant deposes that on 11 October 2013 the court made an order dismissing his application in Miscellaneous Application Number 651 of 2012 in which he was seeking for unconditional leave to file a defence in HCCS number 380 of 2012 (a summary suit) brought by the Respondent against him. The Applicant is aggrieved and dissatisfied with the ruling dismissing his application and filed a notice of appeal against the decision. The order intended to be appealed against involves colossal sums of money and if leave is not granted it would prejudice his intended appeal. He is informed by his lawyers that leave to appeal is an essential step for his intended appeal. The Applicant deposes that he has been informed by his lawyers that his intended appeal is based on points of law and fact and as such has chances of success. That it is just and equitable that the court be pleased to grant leave to enable him to successfully appeal against the orders of the court in Miscellaneous Application Number 651 of 2013.

The Respondent opposed the application and affirmed an affidavit in reply. In the affirmation in reply he asserts that on the basis of information from his lawyers, the Applicant has no bona fide defences to the summary suit. Secondly the intended appeal lacks merit and has no chance of success. Thirdly it would be just and fair that the Applicant’s application for leave to appeal is dismissed with costs.

At the hearing Counsel Kituuma Magala represented the Applicant and Counsel Frederick Sentomero represented the Respondent

Counsel Kituuma Magala relied on the grounds in the notice of motion, the affidavit in support and the enabling rules.  The grounds are as detailed in the notice of motion and supporting affidavit. He submitted that the order intended to be appealed against involves colossal sums of money yet there is no automatic right of appeal and therefore leave is a necessary prerequisite for the appeal to proceed. The intended appeal is on points of law and it would be just and equitable that the court is pleased to grant leave for the Applicant to appeal.

In the affidavit in reply paragraph 3 thereof, the Respondent alleges that there is no bona fide defence and the intended appeal lacks merit with no chance of success. The Applicants Counsel submitted that the order sought to be appealed is respect of leave to appear and defend and there is no basis for saying that there is no defence.  It is not a requirement to discuss the merits of the defence. It was held in Sango Bay Estates versus Dresdner Bank [1971] ULR page 64 that leave is normally granted where there are grounds of appeal meriting judicial consideration and that is the position of law as it stands today.

The Applicant contends that the points of law are that he raised points of law and issues of fact in the application which formed issue for trial but the court found that there was no plausible defence. It is well settled that the court in an application for leave to Defend a summary suit does not deal with the merits of the defence. Furthermore in the case of Charles Sempebwa and 134 others vs. Silver Springs Hotel [1969) Ltd ULR 2007 vol 1 page 338, the Court of Appeal holding 5 held that all that is required is for the Applicant to show serious issue of law or fact which decision was in line with that of Sango Bay Estates (supra). In the Applicants case one of essential steps to appeal is to obtain leave and court should be pleased to grant leave with costs.

In reply Counsel Frederick Sentomero opposed the Application on behalf of the Respondent. He submitted that the authority of Sango Bay Estates (supra) and Charles Sempebwa (supra), both emphasise firstly the disclosure in the application for leave of the grounds of appeal that merit serious consideration. In the case of Charles Sempebwa vs. Silver Springs Hotel (supra), it was held that the application should show prima facie that there are issues of law of fact that merit judicial consideration. The application and affidavit in support in this application do not disclose any prima facie ground of appeal. What is stated in paragraph 7 is that there are tenable points of law but the points of law are not stated in the affidavit. The Applicant has left the court to guess what point of law he wants to appeal. The intention of legislature was the court has to be shown serious matters that the Applicant intends to appeal.

Alternatively Respondents Counsel submitted that the Applicant’s application had been dismissed and they extracted both an order dismissing the application and a decree awarding the Respondent money with costs. In those circumstances the Applicant did not require leave to appeal since a decree is appealable as of right. He prayed that the application is dismissed with costs.

In rejoinder Counsel Kituuma Magala submitted that it was not true that no grounds are enumerated in the application. The grounds are in the notice of motion and supporting affidavit. Particularly in paragraph 7 of the affidavit in support the Applicant deposes that his appeal is on points of law and fact. That notwithstanding holding in Charles Sempebwa and 134 others vs. Silver Springs Hotel (supra) can be further distinguished. The points that merit judicial consideration must be in the application or in the appeal. It is not necessary to consider the merits of the intended appeal and the Applicant has discharged his burden.

As far as the decree is concerned, it is about figures and not appealed from. The order appealed against is on dismissal of application for leave to appear and defend.

Ruling

I have duly considered the Applicants application and the affidavit evidence for and against the application, the submissions of Counsel and authorities cited.

I will start with the last and alternative submission of the Respondents Counsel that when the application for leave to defend the summary suit was dismissed, the court entered judgement for the Respondent and consequently it resulted into a decree. Furthermore, that there is no need for leave to appeal against a decree since the right of appeal there from is automatic.

I do not think that a decree issued under order 36 is appealable. This is because a decree is directed by the rules and under circumstances where the Defendant has not sought leave of court to defend the action. Order 36 rule 3 (2) of the Civil Procedure Rules provides that in default of the Defendant applying for leave to defend the summary suit, the Plaintiff shall be entitled to a decree for an amount not exceeding the sum claimed in the plaint, together with interest, if any, for the money or for the recovery of land with or without mesne profits as the case may be and costs against the Defendant. In the Applicant's case, he applied for leave and the order granting leave was refused. Where a Defendant applies for leave, the applicable rule is Order 36 rule 5 which provides that where after hearing an application by a Defendant for leave to appear and defend the suit and the court refuses to grant such leave, the Plaintiff shall be entitled as against the Defendant to a decree as described in rule 3. In other words, the issuance of a decree is directed by the rules in the first instance upon default of an application to defend the action and in the second instance upon refusal of leave to defend the action. In any such case, the remedy of the Defendant is not to appeal but to make an application under Order 36 rule 11 to set aside the decree on the grounds mentioned in that rule. Consequently a decree in default of an application to file a defence or upon refusal of leave is not appealable because it is directed by the rules. What is appealable with leave is the order of the court refusing to grant leave to defend the summary suit. Consequently the submission that upon the Respondent extracting a decree, that the Applicant had a right to appeal against the judgment resulting into the decree is without merit.

The only matter for consideration is of a preliminary nature. It is based on the Respondent’s submission that the Applicant did not set out any points of law or issues of fact which would merit judicial consideration on appeal. It is a submission that the court has no materials upon which to consider whether there are any points of law or questions of fact which merit judicial consideration on appeal.

I have carefully considered the preliminary point. In the case of Charles Ssempebwa and 134 others versus Silver Springs Hotel (1969) Ltd, Court of Appeal Civil Application Number 103 of 2003, it is clear from the ruling of the court that the Applicant filed an application by notice of motion for leave to appeal against the ruling and orders of the High Court in civil suit number 335 of 2003 and for costs of the application to be provided for. The first ground was that the intended appeal raised serious questions of law and fact that warrant judicial consideration and the Applicant went ahead to set out the issues for consideration by the Court of Appeal. The Applicants Counsel relied on the summary of the holding of the court in the law report which is to the effect that in order to succeed in an application for leave to appeal, the application has to show prima facie that there are serious questions of law or fact or both that merit judicial consideration by an appellate court. In an application for leave to appeal it is not necessary to consider the merits of the intended appeal or its chances of success on appeal.

The case does not support the Applicant’s application and the submissions in support thereof to the extent that the Court of Appeal ruling is to the effect that an application for leave to appeal should show a prima facie case that there are serious questions of law or fact or of both that merit judicial consideration by an appellate court.

I have further considered the case of Sango Bay Estates Ltd and others versus Dresdner Bank AG [1971] Uganda Law Reports at page 62, a decision of the East African Court of Appeal in Civil Application Number 7 of 1970. It is also reported in Sango Bay Estates Ltd and others v Dresdner Bank Ag (No. 2) [1971] 1 EA 307. Spry VP held that leave to appeal from an order in civil proceedings will normally be granted where prima facie it appears that there are grounds of appeal which merit serious judicial consideration where the order from which it is sought to appeal was made in the exercise of judicial discretion. The court went on to consider what the ground which merit judicial consideration was. He held that the basis of the decision of the High Court judge was on a question of law that is whether any claim which the Applicants may have to against G.H.H. is a claim to indemnity or a simple claim to damages. He further held that the court heard lengthy arguments and it was undesirable at that stage to decide on the point and prejudge the issues which will arise on the hearing of the appeal.

It is my humble finding that by using the word "prima facie" the grounds which merit judicial consideration must be disclosed in the pleadings of the Applicant. The issue of fact or law which merit judicial consideration must be brought out for the court to determine whether it ought to go on appeal. Grounds 1, 2, 3, 4, 5, 6, 7 and 8 do not give any questions of fact or law. For emphasis the Applicant maintains that the Applicant commenced the process of appeal. Secondly the order to be appeal against does not apply as of right. Thirdly the order as decreed by the court involves huge sums of money and if leave to appeal is not granted, it would prejudice the pending appeal of the Applicant. The fact that an appeal involves large sums of money is not on the merits. It is therefore not a ground of appeal which merit judicial consideration. The Applicant also maintains that leave to appeal is an essential step in the Applicant's case. Again this is not the ground of appeal. The only ground which could have been considered is ground 7 that the Applicant’s intended appeal has tenable points of law. However the tenable points of law are not set out in the notice of motion or the affidavit in support of the application. Lastly, leave to appeal was sought through a formal application made within 14 days from the order intended to be appealed against. It was not an oral application in which the Applicants Counsel could submit from the bar on the basis of any grounds arising from the ruling of the court.

In those circumstances, the Applicant’s application does not set out any questions of law or fact which will form the basis of the exercise of the courts discretion to grant leave for the Applicant to appeal the order of the court. In those circumstances, the Applicant’s application for leave to appeal is incompetent and accordingly dismissed with costs.

Ruling delivered this 11th day of November 2013

 

Christopher Madrama Izama

Judge

Ruling delivered in the presence of:

Frederick Sentomero for the respondent

Respondent in Court

Kituuma Magala for the Applicant in Court

 

Rose Emeru: Court Clerk

 

Christopher Madrama Izama

Judge

11th November 2013