Court name
High Court of Uganda
Judgment date
30 October 2020

Oryem v Omony (Civil Appeal-2018/100) [2020] UGHC 159 (30 October 2020);

Cite this case
[2020] UGHC 159
Short summary:

Land Law — Ownership 

Family Law — marital status alone does not establish that spouses intend to share ownership, control, and risk of all property interests held by either of them as partners

Evidence — what constitutes a major contradiction will vary from case to case

Headnote and holding:

Land Law — Ownership—The nature and character of the rights vested in the land in dispute relate to its ownership and control. Ownership is the most comprehensive right that one can have in any property and it comes with different rights. — Family Land — section 39 (1) (c) of The Land Act — where a couple is married and the land in question is family land, ownership is restricted in various ways which prevent an owner the full entitlements towards his or her property. The provisions create a general Incapacity of one spouse to contract in his or her own name, in respect of family land, without the other’s consent. This necessarily requires a husband and wife to jointly make the decisions concerning family land and their failure to agree can nullify any proposed transaction. — A spouse may file a suit opposing transfer of family land made by the other In violation of statutory restrictions on his or her power of disposition. — Dealings in family Land — Prospective purchasers of land have two primary concerns; to establish whether the vendor has the right to sell the land in question and secondly, whether there are any third-party rights to the land which may interfere with their intended use of the land be it for both registered and unregistered land.

Family Law — marital status alone does not establish that spouses intend to share ownership, control, and risk of all property interests held by either of them as partners. In the general sense, neither a wife is an agent of her husband nor is a husband the agent of his wife — a couple's financial integration and behaviour within the context of their marriage is relevant to determining the existence and scope of an implied partnership or agency between them — Section 39 (1) (c) of The Land Act creates the legal right to control family land gives a spouse who does not directly transact in the land an opportunity to monitor, control, and insure against loss from the other spouse’s conduct within the scope of their shared ownership and control — the legal right to control family land implies that one spouse cannot deny that the other acted as his or her agent if he or she: (i) failed to use ordinary care to control the other spouse; (ii) that failure enabled the other party to create a reasonable misperception of agency in a third party; and (Hi) the third party changed his or her position in reliance on that misperception. One spouse may be liable for another if he or she knows about, and accepts, the benefits of the other spouse's act with knowledge after the fact. A spouse ratifies the act of another by manifesting assent or by conduct that justifies a reasonable assumption that the spouse so consents — transactions a spouse makes for purposes of increasing or making improvements to the matrimonial property, if both spouses benefit from the proceeds of the contract, creates a relationship of agency between the spouses -

Evidence — what constitutes a major contradiction will vary from case to case. The question always is whether or not the contradictory elements are material, i.e. “essential” to the determination of the case. Materiality is determined on basis of the relative importance between the point being offered by the contradictory evidence and its consequence to the determination of any of the facts or issues necessary to be proved.

Coram
Mubiru, J

 

 

 

IN THE HIGH COURT OF UGANDA SITTING AT GULU

Reportable

Civil Appeal No. 0100 of 2018

In the matter between

 
 

 

ORYEM DAVID                                                                                     APPELLANT

And

OMONY PHILLIP                                                                               RESPONDENT

Heard: 23 June, 2020.

Delivered: 30 October, 2020.

 

JUDGMENT

STEPHEN MUBIRU, J.

Introduction:

  1. The appellant sued the respondent for a declaration that he is the rightful owner of land measuring approximately 100 metres by 20 meters and the shop situate thereon, located at Agwee Parish, Laroo Division, in Gulu Municipality, an order of eviction, permanent injunction, general damages for trespass to land, arrears of rent, interest and costs. His case was that he purchased the land in dispute during or around 1979. Subsequently during the year 2014, the respondent approached him and requested for permission to occupy the land temporarily, which request the appellant granted. It was agreed that the respondent was to occupy the shop thereon paying therefor a monthly rent of shs. 150,000/= During or around April, 2015 irreconcilable differences came to a head between both parties prompting the appellant to terminate the tenancy. The respondent nevertheless refused to vacate the land. The respondent instead went ahead to construct a building on the land, hence the suit.
  2. In his written statement of defence, the respondent contended that he purchased the land in dispute from the appellant and his wife at the price of shs. 3,000,000/= Part of the purchase price was paid in kind through an agreed arrangement by which the respondent financed construction of the appellant’s first wife’s house. The appellant further requested the respondent to complete the construction of a shop on the land which he did at the cost of shs. 2,747,000/= which the appellant has to-date failed to refund.

Appellant’s evidence in the court below.

  1. P.W.1 Oryem David testified that in 1979 he purchased the land in dispute at the price of shs. 1,500/= from a one Rosalia Anyango. During August, 2014, the respondent was introduced to the appellant by a tenant of his who was the respondent’s workmate. The appellant permitted the respondent temporary occupancy of part of the land measuring approximately 10 x 20 metres. He permitted him to construct a temporary house only six metres from his. The appellant never asked the respondent to construct a house for his second wife nor did he sell him any part of the land. He never authorised his second wife to sell any part of that land and he never gave her the land. The respondent thereafter forcefully constructed a semi-permanent house on the land.
  2. P.W.2 Amono Polly Grace, a neighbour, testified that the land in dispute belongs to the appellant. In 2014, the appellant introduced the respondent to her as a person he was accommodating temporarily. The respondent has since constructed a house on the land. P.W.3 Alice Olango another neighbour testified that the land in dispute belongs to the appellant. She is not aware of any sale by the appellant to the respondent. The respondent has since constructed a house on the land. The respondent was operating a shop as a ten ant on the appellant’s building by the roadside. P.W.4 the appellant’s son testified that the respondent was a friend to one of his father’s tenants. The appellant permitted the respondent to occupy part of the land on a temporary basis.

Respondent’s evidence in the court below.

  1. D.W.1 Omony Phillip testified that he came to know the appellant through a friend who was a tenant on the appellant’s land from where he operated a carpentry workshop. The appellant intimated to him that his wife, Rose Oryem, was the treasurer of a women savings scheme and had failed to account for some funds to a microfinance entity, BRAC (Bangladesh Rural Advancement Committee). The appellant’s wife defaulted on loan repayments and approached the respondent for help. She was in urgent need of cash and the appellant was thus offering part of his land for sale. The appellant told him he had partitioned the land and divided it between his two wives. The appellant was willing to receive instalments of the purchase price. They agreed on a price of shs. 3,000,000/= On 7th February, 2014 the respondent paid shs. 200,000/= to the appellant but he did not sign for it. The following days he paid shs. 50,000/= to the appellant’s wife. He purchased the land from the appellant together with his second wife. It is the appellant who at the time of the sale showed him the boundaries of the land. The respondent made multiple payments in instalments until the purchase price was paid in full. After the appellant revoked the sale, he undertook to refund the purchase price. When the appellant failed to refund the purchase price, the local leaders decided that the respondent should remain in occupation of the land and he embarked on construction of the building, starting with one shop.
  2. D.W.2 Oruu Martin testified that at a meeting convened on 11th February, 2015 to resolve the conflict between the parties over the land, the appellant stated that the land had been sold off by his wife and son who had no authority to do so. The appellant had orally authorised his second wife to sell the land but was annoyed by the fact that his wife and son did not give him a share of the purchase price. The appellant’s second wife insisted that the appellant had benefited from the transaction since part of the purchase price was by way of building materials he used to refurbish the house occupied by his first wife. Presence of the appellant’s son and wife during the transaction is proof that the appellant authorised the sale. The meeting decided that the appellant was to refund the purchase price and compensate the respondent for the value of the building and the shop he constructed by the roadside. The respondent undertook to vacate the land upon receipt of the refund and compensation.
  3. D.W.3 Angee Florence, the L.C.1 Chairperson testified that the respondent purchased the land in dispute from the appellant’s wife, Rose Oryem. The appellant told her he had authorised the sale but did not put that in writing. On 25th May, 2015 she witnessed the respondent’s payment of the last instalment of shs. 1,785,000/= to the appellant’s second wife. The appellant told him that the land in dispute belonged to his wife and her children. When a dispute erupted over the sale, she engaged other local leaders in resolving the conflict. The appellant undertook to refund the respondent’s purchase price, but has never complied.
  4. D.W.4 Atii Caroline Betty, the respondent’s wife, testified that it is the appellant who offered the land for sale to the respondent. The purchase price was agreed at shs. 3,000,000/= which the respondent paid instalments. The first instalment of shs. 200,000/= was received by the appellant’s second wife who had some financial difficulties. It is the appellant who authorised his wife to sell the land. The last instalment was on 25th May, 2015 paid to the appellant’s second wife. The differences arose when the appellant could not agree with his second wife as to who between them should receive the balance of the purchase price. That is when the appellant ordered the respondent to vacate the land. At a meeting convened to resolve the dispute, the appellant undertook to refund the purchase price and pay compensation for the respondent’s buildings on the land.

Proceedings at the locus in quo.

  1. The court visited the locus in quo on 11th September, 2018. The Court took note of the fact that the respondent had a permanent, three-bedroomed house on the land, which land measures approximately 20 x 22 metres. The appellant’s homestead is behind the land in dispute. The court prepared a sketch map illustrating developments existing on the land.

Judgment of the court below.

  1. In his judgment delivered on 31st October, 2018, the trial Magistrate found that the documentary evidence produced by the respondent shows that the appellant’s wife and his son received the purchase price for the land in dispute. The appellant paid the purchase price in instalments. The appellant not did not call any of the two, his second wife and son, although they were available, to rebut that evidence. The appellant ratified that transaction when he allowed the respondent to construct a permanent building on the land. This is inconsistent with his claim that the respondent was allowed only temporary occupancy. The appellant would not have watched as the respondent built a three bed-roomed permanent house on the land, well knowing that the respondent’s rights of occupancy were only temporary. The land sold to the respondent was part of that which the appellant gave to his second wife and her children. They had the capacity to sell the land. When differences emerged between the appellant and the respondent whereupon the appellant sought to revoke the sale, the appellant undertook to refund the purchase price, which is a tacit acknowledgment of the validity of the underlying sale. Judgment was accordingly entered in favour of the respondent. He was declared the lawful owner of the land and a permanent injunction was issued restraining the appellant from interfering with the respondent’s possession and use of the land. The suit was dismissed with costs to the respondent.

Grounds of appeal.

  1. The appellant was dissatisfied with the decision and appealed to this court on the following grounds, namely;
  1. The learned trial Magistrate erred in law and in fact in holding that the suit land was properly sold off to the respondent thereby arriving at a wrong decision.
  2. The learned trial Magistrate erred in law and fact in analysing the evidence of P.W.1 on record thereby arriving at a wrong decision.
  3. The learned trial Magistrate erred in law and fact in admitting and analysing the documents tendered by the respondent, to wit; D. Ex.1, D. Ex.2, D. Ex.3, D. Ex.4, D. Ex.5 and D. Ex.6, thereby occasioning a miscarriage of justice.
  4. The learned trial Magistrate erred in law and fact when he ignored the contradictions in the respondent’s case, and selectively evaluated the appellant’s evidence on record thereby arriving at a wrong decision.
  5. The learned trial Magistrate erred in law and fact when he disregarded the evidence of D.W.1, D.W.2 and D.W.3 thereby arriving at a wrong decision.
  6. The learned trial Magistrate erred in law and fact when he failed to properly conduct proceedings at the locus in quo, thereby occasioning a miscarriage of justice.

Argument of Counsel for the appellant.

  1. Counsel for the appellant, submitted that the respondent’s defence was contradictory. He claimed to have purchased the suit land from the appellant and his wife. He then contradicted himself and claimed that he was requested by the appellant to settle on the suit land and in return finance the construction of the house of the appellant’s second wife Rose Oryem. The appellant’s testimony as to acquisition and usage of the land since 1979 was not challenged during cross- examination. The allegation that the appellant called the respondent to pay part of the purchase price to his wife was an afterthought. The appellant had never given I donated his land to his wife Rose Oryem. The appellant never authorised his wife to sell the suit land. The respondent was not clear regarding the question as from whom he purchased the suit land from. In his defence he claimed to have purchased from the appellant and his wife yet he departed from this in his witness statement when he stated that he purchased it from the appellant alone.
  2. Counsel submitted further that under cross-examination the respondent had further contradicted himself when he stated that he purchased the land from appellant’s 2nd wife. The appellant did not authorise his wife to sell the suit land to the respondent. The respondent knew that the suit land belonged to the appellant but he never bothered to have him involved legally in his alleged purchase of the suit land. Had the respondent involved the appellant and consulted the neighbours in his alleged intended purchase of the suit land, he would have known that the suit land belongs to the appellant and not the alleged seller, he would have also known that that wife of the appellant if at all she sold the suit land had no authority to do so and could not pass any good title to the respondent. None of the documents D.E.1 to D.E.5 was signed by any neighbour or local leader or the appellant, it was only D.E.6 which was forged and backdated during the trial to aid the respondent’s fraud that was purportedly signed by local leaders who appear to have connived with the respondent.

Arguments of Counsel for the Respondent.

  1. Counsel for the respondent, did not file submissions in response.

Duties of a first appellate court.

  1. It is the duty of this court as a first appellate court to re-hear the case by subjecting the evidence presented to the trial court to a fresh and exhaustive scrutiny and re-appraisal before coming to its own conclusion (see Father Nanensio Begumisa and three Others v. Eric Tiberaga SCCA 17of 2000\ [2004] KALR 236). In a case of conflicting evidence, the appeal court has to make due allowance for the fact that it has neither seen nor heard the witnesses, it must weigh the conflicting evidence and draw its own inference and conclusions (see Lovinsa Nankya v. Nsibambi [1980] HCB 81).
  2. In its appellate jurisdiction, this court may interfere with a finding of fact if the trial court is shown to have overlooked any material feature in the evidence of a witness or if the balance of probabilities as to the credibility of the witness is inclined against the opinion of the trial court. In particular, this court is not bound necessarily to follow the trial magistrate’s findings of fact if it appears either that he or she has clearly failed on some point to take account of particular circumstances or probabilities materially to estimate the evidence or if the impression based on demeanor of a witness is inconsistent with the evidence in the case generally.
  3. In ground six of the appeal, the trial magistrate is criticised for failure to properly conduct proceedings at the locus in quo. Counsel for the appellant did not substantiate this ground in their submissions. I have perused the record of appeal and have not found any procedural error in the manner in which the court went about its inspection of the locus in quo that materially affected the outcome of the suit. This ground accordingly fails.
  4. In ground 1, 2, 3, 4 and 5, the trial magistrate is criticised for the findings of fact he made leading to his conclusion as to the validity of the sale. It is argued that he accorded too much weight to the respondent’s oral and documentary evidence, while at the same time he unjustifiably disregarded multiple

 

contradictions therein. The determination of the dispute between the parties rested on establishing facts regarding the nature and character of the rights vested in the land in dispute, the capacities of the persons involved in the transaction and the legal and equitable implications of the transaction, which I proceed to address.

i. Ownership and control of the land.

  1. The nature and character of the rights vested in the land in dispute relate to its ownership and control. Ownership is the most comprehensive right that one can have in any property. The concept of ownership of land is an aggregation of a number of rights, including: the right to possession, the right to control, the right to its use and quiet enjoyment, the power to allow others a right to use (licenses and leases), the right to privacy and to exclude others, the right to disposition or to transfer the land to someone else by selling, gifting or inheritance, and the right to use the land as collateral through a mortgage.
  2. It is not in dispute that the appellant and Rose Oryem were at all material time husband and wife. The main rule is that spouses have full right of disposition over their own personal property and assets in marriage, regardless of whether the spouses practice community of property or have separate property. This applies to both the property that is acquired prior to and during the marriage. A spouse has the right to sell, give away and use her own assets. Equally, spouses do not have right of disposition over the other spouse’s assets.
  3. Whereas ownership vests the owner with the most complete powers over land, but where a couple is married and the land in question is family land, ownership is restricted in various ways which prevent an owner the full entitlements towards his or her property. Under section 39 (1) (c) of The Land Act, no person may sell or enter into any other transaction in respect of land, on which the person ordinarily resides with his or her spouse and from which they derive their sustenance, except with the prior consent of his or her spouse. This rule applies regardless of which of the spouses owns or rents I leases the family land. According to section 39 (2) of the Act, the consent has to be in the manner prescribed by regulations made under the Act.
  4. In the instant case, it was the testimony of P.W.1 Oryem David he acquired the land in 1979 and neither never gave no authorised his second wife to sell any part of that land. This was corroborated by his two neighbours P.W.2 Amono Polly Grace and P.W.3 Alice Olango who testified that the land in dispute belongs to the appellant. When the court visited the locus in quo, it found that it was land on which both the appellant and his second wife Rose Oryem ordinarily reside and from which they derive their sustenance. It therefore fits the description of family land. According to Regulation 64 (3) of The Land Regulations, 2004, the consent of a spouse required for any land transaction under the Act had to be in Form 41 specified in the First Schedule to the Regulations. The consent therefore has to be made expressly in writing.
  5. A spouse may file a suit opposing transfer of family land made by the other in violation of statutory restrictions on his or her power of disposition. The provisions thus create a general incapacity of one spouse to contract in his or her own name, in respect of family land, without the other’s consent. This necessarily requires a husband and wife to jointly make the decisions concerning family land and their failure to agree can nullify any proposed transaction. However, section 39 (4) of the Act provides that where such a transaction is entered into by a purchaser in good faith and for value without notice that the consent of the spouse was not given, the transaction is void but the purchaser has the right to claim from any person with whom he or she entered into the transaction, any money paid or any consideration given by him or her in respect of the transaction.

ii. Capacity and formalities of sale of the land.

  1. Prospective purchasers of land have two primary concerns; to establish whether the vendor has the right to sell the land in question and secondly, whether there are any third party rights to the land which may interfere with their intended use of the land. With unregistered land, the principle followed is that an owner cannot transfer more entitlements or rights than he or she had himself or herself. Therefore, there should be a preceding owner that is transferring certain rights in the property to the new owner.
  2. In the case of unregistered land, there is no central register and as such, the burden is on the buyer to ascertain whether the land has been properly conveyed over the years and that the current vendor is the party to whom it was last vested in. This requires a thorough examination of the vendor’s title from the root title onwards. The prospective buyer must undertake such inquiries and make such inspections of the land that would satisfy a reasonably prudent person of business, including a thorough physical investigation of the land and questioning any occupants as to their rights. A purchaser will have constructive notice of any rights reasonably discoverable by inspection of the property, and, in particular, from enquiry of any occupier as to his interests and those of which he holds it.
  3. Constructive notice is the knowledge which the courts impute to a person upon presumption so strong of the existence of the knowledge that it cannot be allowed to be rebutted, either from his knowing something which ought to have put him on further enquiry or from wilfully abstaining from inquiry to avoid notice (see Hunt v. Luck [1902] 1 Ch. 428). The owner of unregistered land should be in position to show an unbroken chain of transfers proving the devolution of the title to his or her current possession.
  4. D.W.1 Omony Phillip testified that upon his inquiry, the appellant told him he had partitioned the land and divided it between his two wives. They agreed on a price of shs. 3,000,000/= It is the appellant who at the time of the sale showed him the boundaries of the land. The appellant was willing to receive instalments of the purchase price. The respondent made multiple payments in instalments until the purchase price was paid in full. He paid the first instalment of shs. 200,000/= directly to the appellant on 7th February, 2014 but the appellant did not sign for it. The following day he paid shs. 50,000/= to the appellant’s wife. He thus purchased the land from the appellant together with his second wife. D.W.4 Atii Caroline Betty, the respondent’s wife, contradicted the respondent as regards the aspect as to who, between the appellant and his second wife Rose Oryem, received the first instalment when she testified that the first instalment of shs. 200,000/= was received by the appellant’s second wife. However, D.W.3 Angee Florence, the L.C.1 Chairperson testified that she witnessed the respondent’s payment of the last instalment of shs. 1,785,000/= to the appellant’s second wife Rose Oryem on 25th May, 2015.
  5. It was argued by counsel for the appellant that the trial court disregarded contradictions in the respondent’s case regarding the issue as to whether the sale was by both the appellant and his second wife Rose Oryem, or by only one of them; and as to who received the various instalments paid. It is settled law that grave inconsistencies and contradictions unless satisfactorily explained, will usually but not necessarily result in the evidence of a witness being rejected. Minor ones unless they point to deliberate untruthfulness will be ignored (see Alfred Tajar v. Uganda, EACA Cr. Appeal No.167 of 1969, Uganda v. F. Ssembatya and another [1974] HCB 278, Sarapio Tinkamalirwe v. Uganda, S.C. Criminal Appeal No. 27 of 1989, Twinomugisha Alex and two others v. Uganda, S. C. Criminal Appeal No. 35 of 2002 and Uganda v. Abdallah Nassur [1982] HCB). The gravity of the contradiction will depend on the centrality of the matter it relates to in the determination of the key issues in the case.
  6. What constitutes a major contradiction will vary from case to case. The question always is whether or not the contradictory elements are material, i.e. “essential” to the determination of the case. Material aspects of evidence vary from case to case but, generally in a trial, materiality is determined on basis of the relative importance between the point being offered by the contradictory evidence and its consequence to the determination of any of the facts or issues necessary to be proved. It will be considered minor where it relates only on a factual issue that is not central, or that is only collateral to the outcome of the case.
  7. In the instant case, the land in question is family land. The issue as with whom, between the appellant and his second wife Rose Oryem, the respondent entered into the transaction was of critical importance in the light of the general incapacity of one spouse to contract in his or her own name without the other’s consent. On the other hand, the question regarding who between them received what instalment is only of ancillary importance. While contradictions regarding the former may be grave, those regarding the latter are not. While contradictions regarding the former, unless satisfactorily explained, could potentially result in the evidence being rejected, the one regarding the latter would be ignored unless they pointed to deliberate untruthfulness.
  8. The explanation for the respondent’s inconsistence regarding the issue as with whom, between the appellant and his second wife Rose Oryem, the respondent entered into the transaction, is attributed to the appellant’s inconsistence. It is explained by the fact that while the appellant told the respondent and D.W.3 Angee Florence that he had partitioned the land and divided it between his two wives, as a result of which the respondent executed a contract with her and made the bulk of the payments to her, the appellant intervened later insisting that the last payment should be made to him. Thus while at the commencement of the transaction on 7th February, 2014 the appellant presented his second wife Rose Oryem as authorised to transact in her own name, a year later on or about 25th May, 2015 he turned around insisting in essence that his second wife had only transacted as his agent.
  9. An agency relationship can be either express or implied. Marriage is not necessarily considered a relationship of agency solely due to the mere fact the couple is married. The marital relationship per se does not make the wife the agent of her husband. As a result of the emancipatory effect of article 31 of The Constitution of the Republic of Uganda, 1995 a wife has full authority to enter into any contractual obligation in her own name. A wife has the capacity to enter into binding contracts in her own name and without the intervention of her husband. In contracts of a commercial nature, when the wife trades in her own name, the law will not presume that she acts as an agent of her husband. Situations in which the husband is held responsible for his wife's contracts are very limited.
  10. The relationship of principal and agent could exist between husband and wife only under the presumption that the wife has an authority to pledge her husband’s credit for necessaries suited to their living style. In some situations, one spouse becomes liable for the other not by consent but rather by imputation. A married woman living with her husband has implied authority to pledge his credit for necessaries suitable to his degree and station in life (see Miss Gray, Ltd. v. Earl of Cathcart, (1922), 38 T.L.R. 562). The term "necessaries" is relative and depends on the social and financial condition of the parties and the circumstances of each case. The courts recognize the husband's liability in two instances; he is held responsible for his wife's purchases of "necessaries" even without his consent, and in certain situations where he is found to have ratified his wife's purchases of "non-necessaries" when he had not initially consented to these acquisitions (see Lamonica v. Royal Furn. Co., 197 So.2d 147 (La. App. 1st Cir. 1967); Barnes Furn. Store v. Young, 111 So.2d 549 (La. App. 1st Cir. 1959)\ and Montgomery v. GremiIlion, 69 So. 2d 618 (La. App. 2d Cir. 1953). When goods are purchased by the wife for the use of the husband and his wife, or where by conduct the husband ratifies of the contract even if the subject matter of the contract may not be classified as necessaries. The presumption of implied agency between husband and wife is restricted to the price of necessary goods. It does not extend to money borrowed by the wife. That is, the husband is not liable if the wife has borrowed money. The lender cannot be regarded as looking in any way to the husband to be responsible for the debt. Where the liability at issue is not one for which spouses share liability by virtue of marital or family status, creditors must show a partnership or other agency relationship between spouses to impute one spouse's liability to the other.
  11. It is pertinent that merely because of the marriage a wife cannot be treated as a general agent of his husband. Marital status alone does not establish that spouses intend to share ownership, control, and risk of all property interests held by either of them as partners. It does not establish a mutual agency such that the act of one is always the act of both. In the general sense, neither a wife is an agent of her husband nor is a husband the agent of his wife. Yet, like any two legally distinct individuals, one spouse can act as agent for the other. Although the couple's marital status is not dispositive, a couple's financial integration and behaviour within the context of their marriage is relevant to determining the existence and scope of an implied partnership or agency between them. There may be circumstances when the wife may act as an implied agent of his husband provided that; (i) she has no time to inform her husband before making the contract; (ii) the contract was reasonably necessary; (iii) she acted bona fide in the interest of the husband; and (iv) the contract was in the ordinary course of business. Where an act done by the wife is not done in ordinary course of business, the husband cannot be bound by such contract.
  12. Section 39 (1) (c) of The Land Act, imposes a general restriction on one spouse to contract in his or her own name without the other’s consent. This legal right to control family land gives a spouse who does not directly transact in the land an opportunity to monitor, control, and insure against loss from the other spouse’s conduct within the scope of their shared ownership and control. This opportunity gives the other spouse an advantage in preventing or insuring against risk of loss from the conduct of the spouse directly transacting with a third party, who thereby enters into a credit relationship with the spouse directly transacting. Shared ownership or control of family land creates an incentive for one spouse to control the behaviour of the other. The combination of incentive and right to control the spouse directly transacting makes the other spouse the cheaper bearer of risk of loss (relative to the third party), hence section 39 (4) of The Land Act which guarantees a refund of the purchase price to a purchaser in good faith and for value without notice that the consent of the spouse was not given.
  13. Marriage is a relationship in which the spouses devote their particular talents, energies, and resources to their mutual benefit. The acquisitions and benefits made by the spouses using matrimonial expenditure of labour and resources are shared equally. The spouses’ interest is equal, undivided, immediate and vested. In that context, the possibility that transactions a spouse makes for purposes of increasing or making improvements to the matrimonial property, if both spouses benefit from the proceeds of the contract, creates a relationship of agency between the spouses, is inevitable. In such circumstances, either spouse may be presumptively the agent for the other as to create a relationship of agency between the spouses.
  14. From a different perspective, the legal right to control family land implies that one spouse cannot deny that the other acted as his or her agent if he or she: (i) failed to use ordinary care to control the other spouse; (ii) that failure enabled the other party to create a reasonable misperception of agency in a third party; and (iii) the third party changed his or her position in reliance on that misperception. One spouse may be liable for another if he or she knows about, and accepts, the benefits of the other spouse's act with knowledge after the fact. A spouse ratifies the act of another by manifesting assent or by conduct that justifies a reasonable assumption that the spouse so consents. A spouse may lose his or her right to raise his or her lack of knowledge of the facts as a defence to ratification, if after learning of the facts; he or she retains the benefits of the transaction with knowledge of the facts.
  15. Ratification is a kind of affirmation of unauthorised acts. The doctrine of ratification comes into play when a person has done an act on behalf of another without his or her knowledge or consent. According to section 130 of The Contracts Act, 7 of 2010 where an act is done by one person on behalf of another but without the knowledge or authority of that other person, the person on whose behalf the act is done may ratify or disown the act. By virtue of this provision, an act done by person who is not authorised to do it, but who purports to act as an agent for another person, can retrospectively ratified by such other person. From this it follows logically, that such an act on the part of the person purporting to act as agent is not void but voidable. If it is not ratified it becomes void but if it is ratified it will be validated. Ratification may be express or implied by the conduct of the person on whose behalf an act is done (see section 131 of The Contracts Act, 7 of 2010). Where a person ratifies an unauthorised act done on behalf of that person, the whole of the transaction of which the act forms a part is accordingly ratified.
  16. Absent evidence of an express agreement as to actual authority between principal and agent, a court can find authority by implication (apparent authority) based on the perspective of the third party who deals with the directly liable person (the actor). The principal is vicariously liable for the actor's conduct if the third party reasonably believed the actor had authority to act on her behalf and the third party's belief is traceable to a manifestation of the principal. Implied agency occurs when the words and actions of the parties, which the third party reasonably believes the agent has the authority to take, indicate that there is an agency relationship. When one party leads a second party to believe a third party represents them. It is the relationship which arises when a third party relies on principal’s expressed or implied representation that a particular party is their agent, even though no such agreement ever existed. Once it is created, the principal is prevented (by estoppel) from denying its existence.
  17. It was the testimony of both the respondent and D.W.3 Angee Florence that the appellant knew of and was part of this transaction as early as sometime before on 7th February, 2014. The respondent continued to pay instalments of the purchase price to the appellant’s second wife over a period of almost a year. It was the respondent’s testimony that part of the purchase price was made in kind by way of financing the construction of the appellant’s first wife’s house and completion of the construction of a shop. It is only a year later, sometime after 25th May, 2015 that the appellant opted to revoke the transaction.
  18. A relationship of agency may exist between spouses either by an express appointment or by holding out (estoppel) or by ratification. An agency by estoppel is based on the principle of estoppel which lays down that when one person by declaration (representation), act or omission has intentionally caused or permitted another person to believe a thing to be true and to act upon such belief, he is not allowed to deny his previous statement or he is stopped to deny his previous statement or conduct. This agency is implicit under sections 130 (2), 131 and 133 of The Contracts Act, No.7 of 2010. A principal may not choose to act through agents whom he or she has clothed with the trappings of authority and then determine at a later time whether the consequences of their acts offer an advantage. Ratifications may be either empress or implied. It is express when made in direct terms of assent and it is implied when the law presumes it from the acts of the principal. Once an act is ratified, upon a full knowledge of all the material circumstances, the ratification cannot be revoked or recalled; the principal becomes bound as if he or she had originally authorised the act.
  19. Implied agencies also arise where one person behaves as an agent would and the “principal,” knowing that the “agent” is behaving so, acquiesces, allowing the person to hold himself out as an agent. The appellant knew that this is the impression his wife created yet allowed her to so act. There was sufficient evidence on which to find that the wife was acting within the scope of her authority as agent of appellant. In all cases where the wife acts for her husband with his consent, the husband could be held liable even in situations where the third party was unaware of his existence at the confection of the contract.
  20. Moreover, it has been held that if a third party, knowing that the person with whom he is dealing is acting on behalf of a known principal, reduces the contract to writing, in which no mention is made of such principal, the agent appearing as the sole party in interest, that is not sufficient to constitute as a matter of law a binding election to, hold the agent and release the principal (see Calder v. Dobell (1871), LR. 6 C.P. 486 and Paquin, Limited v. Beauclerk, [1906] A. C. 148). It would appear that the execution of the written memorandum by the wife, or in contracting with the wife, while binding herself, does not operate to discharge the husband, if the Court could find authority, actual or implied. I find that the inconsistencies and contradictions regarding the parties to the contract were satisfactorily explained by the facts surrounding the transaction.
  21. That payments for the land were made is not in doubt. Although P.W.1 Oryem David testified that he never authorised his second wife to sell any part of the land and that he only permitted the respondent temporary occupancy of part of the land measuring approximately 10 x 20 metres, D.W.3 Angee Florence, the L.C.1 Chairperson testified that appellant told him that the land in dispute belonged to his wife and her children. She testified further that the appellant told her he had authorised the sale although he did not put that in writing. Although P.W.1 Oryem David claimed that he only allowed the respondent to construct a temporary house only six meters from his, and that the respondent had thereafter instead forcefully constructed a semi-permanent house on the land, D.W.3 Angee Florence that the appellant revoked the sale only after his second wife had on 25th May, 2015 received the last instalment of shs. 1,785,000/= whose payment she witnessed. The appellant thereafter at mediation undertook to refund the purchase price. Having chosen to act through his second wife Rose Oryem whom he has clothed with the trappings of authority, the appellant could not determine at a later time whether the consequences of his acts offered an advantage and purport to revoke the sale. In the circumstances, contradictions regarding who between them received which instalment would justifiably be ignored since they did not point to deliberate untruthfulness.

iii. Equitable perspectives of the appeal.

  1. The contract, although one was signed with his second wife, was in essence between the respondent and the appellant and it was oral. According to section 10 (5) of The Contracts Act, 7 of 2010, a contract the subject matter of which exceeds twenty-five currency points (500,000/=) must be in writing. The goal of the written contract rule remains the avoidance of fraud by requiring written proof of the underlying agreement. Contracts which do not comply with the requirement of the section though are not void, but are merely unenforceable by action (see for example Britain v. Rossiter (1879) 11 QBD 123). The "writing" envisaged does not require a formal written contract. This requirement is satisfied by any signed writing that; - (i) reasonably identifies the subject matter of the contract, (ii) is sufficient to indicate that a contract exists, and (iii) states with reasonable certainty the material terms of the contract. It can be a receipt or even an informal letter.
  2. On the other hand, part performance of an oral contract for the sale of land makes it enforceable in equity (see Stanley Beinababo v. Abaho Tumushabe, CA. Civil Appeal No. 11 of 1997). It is a doctrine of equity that a contract required to be evidenced in writing will still be enforceable even if it is not so evidenced provided that one of the parties does certain acts by which the contract is partly performed. Under that principle of equity, even if a contract that should be in writing under section 10 (5) of The Contracts Act, 7 of 2010 is not in writing, that does not eliminate the possibility of its enforceability. Performance can also satisfy section 10 (5) of The Contracts Act, 7 of 2010. The reason is that, while the provision is designed to avoid fraudulent enforcement of contracts that never took place that the contract was carried out can also be powerful confirmation of the agreement.
  3. Payment in whole or in part of the purchase price is not an act of part performance which entitles the purchaser to enforce a parol contract (see Halsbury Laws of England 3rd Edition Vol.36 page 297). Part performance is achieved when pursuant to the contract possession is delivered to the vendee by the vendor The fact of possession is a substitute for the contract required by The Contracts Act, 2010 because it would be intolerable in equity for the owner of a tract of land to knowingly suffer another to invest time, labour, and money on the land, upon the faith of a contract which did not exist. When the purchaser succeeds in establishing delivery of possession, or if he or she has taken possession with the assent of the seller, under the alleged oral contract, he or she has made out his or her case of part performance
  4. Furthermore, section 14 (2) (b) (i) of The Judicature Act constitutes the High Court as a court of equity. Where there is a conflict or variance between the rules of equity and the rules of common law with reference to the same subject, the rules of equity prevail (see section 14 (4) of the Act). It is the supreme duty of a court of equity to prevent fraud. The court will not permit an inequitable use of provisions of a Statute in aid of a fraud (see Steadman v. Steadman [1976] AC 536; [1974] 2 All ER 977).
  5. Considering that the ultimate function of section 39 The Land Act is the prevention of fraud in transactions relating to family land, the appellant could not rely on it to obtain unjust enrichment. Courts allow the recovery of benefits conferred under an unenforceable or voidable contract, by imputing a quasi­ contract. If one party to an agreement stands by and lets the other party incur expense or prejudice his position on the faith of the agreement being valid he will not, then be allowed to turn round and assert that the agreement is unenforceable. It is in keeping with equitable principles that in proper circumstances a person will not be allowed fraudulently to take advantage of a defence of this kind.
  6. In this case the evidence shows that the appellant knew of his wife's sale; he knew with whom the deal was made; he used part of the proceeds by way of construction material, without any protest or warning to respondent that he was not bound or did not intend to be bound on his wife's contract. Even after a conflict erupted between him and the respondent, he sought amicable settlement by way of refund of the purchase price and payment for the respondent’s developments on the land, even though he was not financially able to pay immediately rather than that he had never authorised or ratified the contract.

Order:

  1. In the final result, there is no merit in the appeal. It is consequently dismissed. The costs of the appeal and of the court below were awarded to the respondent.

Delivered electronically this 30th day of October, 2020 .........
 

Stephen Mubiru......

Stephen Mubiru
Resident Judge, Gulu

 

Appearances

For the appellant : M/s Odongo and Co. Advocates

For the respondent : M/s Conrad Oroya and Co. Advocates.