Court name
Supreme Court of Uganda
Case number
Civil Appeal 7 of 2003
Judgment date
12 October 2004

Administrator General v Bwanika James and Ors (Civil Appeal 7 of 2003) [2004] UGSC 29 (12 October 2004);

Cite this case
[2004] UGSC 29

THE REPUBLIC OF UGANDA
IN THE SUPREME COURT OF
UGANDA

AT MENGO

(CORAM: ODOKI, CJ, ODER, TSEKOOKO, KAROKORA AND
KANYEIHAMBA, JJS.C.)

CIVIL APPEAL NO. 7 OF 2003
BETWEEEN


1. ADMINISTRATOR GENERAL
:::::::::::::::::::::::::::::::::::::::
APPELLANT

AND

1. BWANIKA JAMES
2. MAYANJA
ALEX
3. KAKEETO
PATRICK
4. NAMUGERA
AMOS
5. MAYIGA
WUKSON
6. NAKUYA
JOYCE
7. NAMUKASA
CHRISTINE
8. NAMAYANJA
ROBINA
9. NABISIGYE
ESEZA
10. KWANDAGO BEATRICE
:::::::::::::::::::::::::::::::::::::::
RESPONDENTS


(Appeal from the decision of the Court of Appeal of Uganda at Kampala
(Mpagi-Bahigeine, Twinomujuni, and Kitumba, JJ.A) dated 7th July,
2003, in Civil Appeal NO.
36 of
2002)


JUDGMENT OF ODER, JSC

This is a second appeal. It is brought against the judgment of the Court of
Appeal dismissing the appellant's appeal against a judgment
of the High Court in
a suit instituted by the respondents against the appellant. The background to
the appeal is as follows: The
High Court granted the appellant Letters of
Administration to administer the estate of the deceased, Francis Drake Mayiga,
in Administration
Cause No. 851 of 1978. The estate consisted mainly of a
commercial building in Masaka Municipality. The respondents were the children
of
Francis Drake Mayiga (deceased) and the beneficiaries of his estate. With the
agreement of the respondents; the appellant authorized
the law firm of M/S Ntume
Nyanzi & Co. Advocates to sell the building and remit the proceeds of sale
therefrom to the appellant
for distribution to, or management for, the
respondents, most of whom were minors at the material time. On 9/5/1996, the law
firm issued a cheque, the proceeds of sale, for Shs: 83,995,560/=. The cheque
was collected by one Katamba-Mukiibi, a member of staff
and a State Attorney in
the appellant's Department. The cheque was later banked by a Senior Accountant
of the appellant, one Lawrence
Lagara, on the appellant's Bankruptcy Estate
Account
No. 3506, instead of in the appellant's General Account,
No.3432. Both the accounts were in the Kampala main branch of the
former Uganda Commercial Bank Ltd. (thereinafter referred to as "the Bank").
Lawrence Lagara and the Appellant's Accountant called J.B Mukasa were the
signatories to the Bankruptcy Estate Account. They withdrew
all the money over a
period of two years and disappeared. The beneficiaries of the estate, the
respondents, never received a single
cent from the proceeds of sale of the
estate. In 1991, they jointly instituted the suit in this

case against the appellant only. In view of the parties' respective cases as
canvassed at the trial and on appeals in this Court and
the Court below it is
necessary, in my view, to refer to what they stated in their pleadings. The
respondents' amended plaint stated,
inter alia:





"6. In the course of the administration of the said estate the Defendant
received on or about 9/5/86, a sum of Shs: 83,995,560/= for and
on behalf of and
on account of the plaintiffs, the said sum being part of the proceeds out of the
sale by the defendant as administrator
of the estate of late Francis Drake
Mayiga's property comprised in Leasehold Registrar volume 643 Folio 18, plot 31,
Kampala Road,
Masaka Municipality.


7. The Defendant in breach of his duties and obligations to the plaintiffs
as administrator and trustees has failed and/or ignored
and/or refused to effect
payment of the said sum to the plaintiffs, but has instead converted the same to
his (Defendant) use and
has thus caused each and every plaintiff to suffer loss
and damage and plaintiffs claim damages by reason thereof.


8. The plaintiffs demand from the Defendant is for payment of Shs:
83,995,560/= as money had and received for and on behalf and on
account and in
trust of the plaintiffs and which the Defendant is not at all entitled to keep
for himself.






9. The plaintiffs contend that whatever is complained of herein was
carried out by the Defendant's servants/agents/employees authorized
agents
acting in the course and within the
scope of their
employment with the Defendant and as such the Defendant's
vicariously

liable by reason thereof

WHEREFOR it is prayed that judgment be entered for the plaintiffs against
the Defendant
for:

a) Principal
sum of Shs: 83,995,560/= and in the alternative the proportionate present
monetary value of the plaintiffs' interests in
the said
property.
b) General
damages for conversion.

Interest on
the sums in (a) and (b) above at the rate of 50% per annum from 1st
May, 1986, till payment in full

c) Costs of the suit".

The gist of the appellant's defence to the suit was set out in the following
paragraphs of the written statement of defence:

"5 The Defendant states that this suit is misconceived and is
bad in law so for as: -

i) The plaint discloses no cause of action

ii) The orders and declarations sought by the plaintiffs are
subject of criminal proceedings against the defendant's former employee Mr.
Lagara who acted fraudulently, illegally and out of the course of duties in
converting and putting to his personal use money intended
for the plaintiffs,
see a copy of a report of the Police investigating
officer attached hereto and marked annexure "A".


iii) The Defendant has at all times material exercised due
diligence and has never at anytime been negligent and/or been in breach of its
duties
and
obligations

7. Paragraph
5 is accepted in so far as it relates to the Administration of the estate but
the rest of the paragraph is denied and the
plaintiffs will be put to strict
proof thereof.
8. Paragraph 6 is
denied and the plaintiffs will be put to strict proof
thereof.
9. Paragraph 7 is denied
and in the Defendant shall aver in reply that he has exercised due diligence and
has never at any time been
in breach of his duties and obligations and/or
converted any money to his own
use.
10. Paragraph 8 is denied and the plaintiffs will
be put to strict proof thereof


11. Paragraph 9 is denied and the defendant avers in reply that
never has he authorized agents/servants/employees acting in the course of their
employment
performed any act or omission rendering him vicariously liable and
the plaintiffs will be put to strict proof
thereof."


About three years after the pleadings had closed the appellant applied for a
third party notice to issue against the Bank. The purpose
of the third party
notice was to join the Bank as a party to the suit and to claim indemnity from
it for the respondent's money,
which had been lost in the Bank. The trial judge
granted the application and the third party notice was served on the Bank but it
neither entered an appearance nor filed a defence. The suit was therefore tried
with only the appellant and the respondents as parties
to it. Three issues were
agreed and framed at the commencement of the trial. They were:





"1. Whether the Administrator General is responsible for the sale and
distribution of the proceeds in respect of the property comprised
in Leasehold
Register 643 Folio 18, Plot 311, Kampala Road,
Masaka.

2. Whether
the Administrator General is liable to pay the proceeds there from and or the
proportionate monetary value of the property
to the
plaintiffs.
3. Other remedies if
any to the plaintiff".


The learned trial judge heard evidence from both parties. In her judgment,
she answered the first and second issues in the positive
and ordered that the
appellant should pay to the respondents:

(a) The current value of U.S.
dollars equivalent to Shs:
83,995,560/=;
(b) Interest on the decretal sum
at the rate of 6% per annum from 1st may 1986 till payment in
full.
(c) The costs of the
suit.


The appellant's subsequent appeal to the Court of Appeal was unsuccessful.
That Court, however, varied the award of damages made by
the learned trial judge
and ordered the appellant to pay to the respondents:

(a) Shs: 424,891,540/= being the amount of money the respondents would have
received if the original sum of Shs: 83,995,560/= had
been invested by the
appellant in a fixed account at the interest rate of 10% per annum for 17
years

(b) General damages of Shs:
10,000,000/= for each of the ten respondents making a total of Shs:
100,000,000/=
(c) Interest of 6% per annum on
the decretal amount of Shs: 524,891,
540/=
(d) Cost of the suit in the High Court
and of the appeal in the Court of Appeal.


This appeal is against that judgment.

There are three grounds of appeal, which are similar to those, which were
argued for the appellant in the Court below.

The grounds are:





"1). The learned Justices of Appeal erred in law in upholding the
trial judge's finding that there was no evidence of negligence on the
part of the Uganda Commercial Bank Ltd. When it accepted a cheque drawn and
clearly marked "Pay THE ADMINISTRATOR
GENERAL" to be banked on a Bankruptcy
Account, which did not belong to the Appellant.






2). The learned Justices of Appeal erred in law in not holding Uganda
Commercial Bank Ltd. liable to indemnify the appellant for the
loss he
incurred.
3). The learned Justices of appeal misdirected themselves by applying a
wrong formular in awarding damages of Shs:
524,891,540/= which in the circumstances is
excessive".


The memorandum of appeal then prayed for orders that:

a) The judgments of the High
Court and of the Court of Appeal be set
aside.
b) The appellant be indemnified by the
Uganda Commercial Bank Ltd, for the loss it
incurred.
c) The appellant be granted
declarations that this Court deems fit under rule 1 (3) of the Supreme Court
Rules.
d) The appellant be awarded the costs of
this appeal and cost in the Courts below.


Both parties filed their respective arguments of the grounds of appeal. At
the commencement of the hearing Mr. Francis Atoke, Principal
State Attorney, the
counsel for the appellant filed a supplementary Record of Appeal with leave of
the Court. It was a short one,
containing only the trial Court's record granting
the appellant's application for issue of a third party notice against the
bank.

The appellant's written arguments in support of the appeal were filed by the
Administrator General's Department. The appellant's
submission regarding
ground one reiterated the arguments on the ground one of the appeal in the lower
court. The arguments are that
the evidence adduced at the trial by the appellant
was sufficient to support a finding that the bank was negligent in allowing a
cheque drawn in the appellant's name to be banked on a different account;
evidence was provided by a report dated 24/2/94, compiled
by D/SP J.B. Kaunda of
Frauds C.I.D Headquarters, who was not called as a witness. The report was
listed as one of the agreed documents
at the trial.


The second
paragraph of the report by J.B. Kaunda, D/SP is the most relevant to the
appellant's submission. It states:

"Inquiries have shown that Mr. Lagara banked the cheque on Account No.
3506 with U.C.B. Kampala Main Branch (Bankruptcy Estate) on
which he (Lagara)
and Mr. J.B. Mukasa were the only signatories. It should be noted that Account
No. 3506 (Bankruptcy Estates) is
for the Registrar General of Companies and has
nothing to do with the Administrator General's Department. It should also be
noted
that the cheque in question had the payee clearly marked: "CREDIT
ADMINISTRATOR GENERAL" and the bank should not have accepted to
credit this
money on the account of a wrong payee i.e. Bankruptcy Estates".

It is contended in the appellant's submission that the C.I.D. report having
been admitted in evidence by agreement of both the parties'
section 57 of the
Evidence Act applied to it. There was therefore no requirement for the appellant
to prove it by calling its author
as a witness. Consequently, the C.I.D report
should have been relied on by the Hon. Justices of Appeal in determining whether
the
bank was negligent or not.

In view of the stated names of the payee of the cheque, the Bank should have
rejected payments of cash out of the cheque over the
counter since the cheque
was marked "Credit AMINISTRATOR GENERAL". But instead the bank paid some cash
over the counter out of the
cheque to Lagara and Mukasa until the money was
exhausted.

It is further contended in the Appellant's submission that as Omara Obel
(DW2) testified, "the cheque was fraudulently banked on a different
account.... if it had been banked in the Administrator General's Account, cash
would not have been withdrawn."


The appellant relied on certain authorities in support of his case. These
are: Marrice Megrah & F.K Ryder on Paget's Law of Banking,
Butter-Worths, 9th Edition, Pages 89-90, regarding a banker's
role in respect of trust account's; Commissions of Taxation Vs. English.
Scottish and Australian Bank Ltd. (1970)

AC683 regarding the test of negligence; A.L. Under Wood
Ltd.

Vs. Bank of Liverpool (1924) AC 776, in which a sole director
of a company banked cheques meant for the company on his private account to
defraud the company's bankers
and the recipient bank did not query the
transaction and House Property Vs. London County and Westminister Bank
(1915) 84 L.J (K.B.) 1846


The respondent's written submission in opposition to the appellant's
submission was filed by M/S Lwere, Lwanyaga and Co. Advocates.
On ground one of
the appeal the respondent reiterated and adopted their arguments in the High
Court and the Court of Appeal since,
it is contended, the appellant's ground is
similar to the equivalent grounds of appeal in the Court below. The respondents
now contend
that answers to certain issues would effectively and completely
dispose of all the arguments made in the appellants submission under
ground one
of the appeal.

The first is whether or not the Bank was a party to the suit at the trial, to
the appeal in the Court below, and to this appeal. The
respondents contend that
although the appellant applied for a third party notice to issue against the
Bank, he omitted to take important
steps to join the Bank as a party to the
suit. Nor was the Bank ever made a party to the first appeal. It would therefore
be inconsequential
for this Court to find negligence on the part of the Bank
when it was not a party to the suit, to the first appeal and to the present
one.
I shall comment more

12

on this point later when considering ground two of the appeal, to which it is
more relevant.


Secondly, it was not framed as an issue for
determination of the trial Court whether or not the Bank was negligent in
processing the
cheque through account No. 3506. Nor did the appellant apply to
the trial Court under order 13, rule (1) of the Civil Procedure Rules
to amend
the agreed issues; or the trial Court on its own motion amend the issues. The
respondent's contention therefore is that
liability for negligence cannot be
found against the Bank, as it was not an issue at the trial.

Thirdly, whether or not the appellant adduced sufficient evidence or any
evidence at all at the trial of the suit to prove that the
Bank was negligent in
the way it dealt with the suit cheque. According to the respondents no such
evidence was adduced by the appellant.
On the contrary, evidence available
proved the plaintiff's negligence. The suit cheque was paid on Account No. 3506,
which also belonged
to the appellant; exhibit D2, the Banks paying in slip,
clearly stated "Credit Administrator General". Whether or not there was a
mis-posting of the cheque, it is contended that this was not evidence of
negligence on the part of the Bank. It was the appellant's
Principal Accountant,
Lagara who banked the suit cheque on account No. 3506. Lagara had the authority
as an officer of the appellant's
Department to bank the cheque and did so in the
course of his employment. If it was the wrong account and Lagara acted for his
own benefit or for the benefit of this employer in the course of his duty, his
employer, the appellant was vicariously liable for
his action. See Lloyd
Vs. Grace, Smith (1912) H.L 716: and Cassidy Vs. Ministry of Health (1951)2.
(K.B.) 343.


Fourthly, since both accounts 3506 and 3432 belonged to the appellant, it was
not proved by evidence whether cheques written "Credit
Administrator General"
could not be banked on the Bankruptcy Estate account.

Fifthly, the appellant did not make a written complaint to the Bank about the
cheque having been banked on account No. 3506, if indeed
it was the wrong
account. The cheque was banked on 13th May, 1986, and money was
withdrawn by Lagara and Mukasa for a period of two years, up to march/April,
1988. The respondents kept
on checking on the appellant during this period but
were not informed of what had happened to the suit cheque. This means that the
appellant could not have been ignorant of what had happened to the cheque. The
beneficiaries of a trust fund, like the respondents
in the instant case, are
entitled to information relating to documents concerning the trust account.
See Re. Londonderry Settlement (1964) 3 All E.R 855 . Regarding
the CID report written by Kaunda D/SP, No. 5 on the list of Agreed Documents, it
is contended for the respondents that the
report did not prove negligence on the
part of the Bank. Documents merely agreed upon during the scheduling conference
of a trial
are not themselves admissions within the meaning of section 57 of the
Evidence Act. They are documents, which the parties have agreed
to rely on
during the trial. It is still left to the parties to adduce evidence on such
documents because they have not been admitted
in evidence as
exhibits.

It is contended that the learned Justices of Appeal were correct in rejecting
the CID report dated 24/2/1994.

Finally on ground one the respondents submitted that as this is a second
appeal from the judgment of the first appellate court upholding
the trial Courts
finding of fact, it is contended that this Court, as the second appellate court
should not interfere with the finding
of fact unless it is established that the
first appellate court failed, in effect, to consider and weigh the evidence and
further
that the failure of the first appellate Court to evaluate the evidence
is clearly apparent from the wording of its judgment. The
respondents contend
that in the instant case, the Justices of the Court of Appeal clearly and
carefully weighed the evidence on record
before they came to their conclusions.
The honourable Justices neither erred nor misdirected themselves when
re-evaluating the
evidence on record. See Shantila Manaklal Ruwala V. R
(1957) E.A.570.


The respondents then prayed that this Court should disallow ground one of
appeal.

In the Court of Appeal, Twinomujuni, J.A, wrote the lead judgment, with which
the other two members of the Court agreed. He dealt
with the appellant's
contention that the Bank should have been found to have been negligent this
way:





"The central issue in this ground of appeal is whether
Bankruptcy A/C 3506 belonged to the appellant or not. The appellant relies on a
documentary report, which appears on the Record of Appeal as an investigation
report of D/SP J.B Kaunda. The document is dated 24th February, 1994.
It is not marked as a court exhibit and D/SP Kaunda did not give evidence in
court. The report suggests that the A/C
No. 3605 did not belong to the
Administrator General but to the Registrar General: It does not explain,
however, how Lawrence Lagara
and J.B. Mukasa both of whom were accountants of
the appellant could have been signatories of the account. In my view, the report
has no evidential value and its contents which were not tested in court cannot
be relied upon.

The
learned trial judge did not make a specific finding on the matter.
However, there is the evidence of DW3, D/ASSP. A.P Omara which
though
contradictory on the issue states, under cross-examination that "This account
was called Bankruptcy Estate. It was not an
account of the Administrator General
as earlier stated". This version is corroborated by an earlier report he had
made after investigation
in 1988 (Exhibit D.1) where he stated: "The same cheque
was fraudulently banked by Lawrence Lagara on 12/5/86, on A/C 3506 BANKRUPTCY
ESTATE instead of A/C 3432 ADMINISTRATOR GENERAL. Although both accounts
belong to the Administrator General,
it would be in order if the cheque was
deposited on A/C 3432".


The version of D/ASSP Omara (DW3) is further corroborated by the
undisputed fact that Lawrence Lagara and J.B Mukasa were both Accountants
of the
Administrator General. An examination of the account 3506 (Exhibit D4) shows
that it was a busy account where huge sums of
money were being transacted. It
was being operated by Lagara and Mukasa. The appellant never called any evidence
to prove that the
account was not being operated on its behalf or that it
belonged to the Registrar General as it was being suggested. I agree with
counsel for the respondents that the trial judge did not hold that UCB was not
negligent. It was not a framed issue. She

17

held however, that she did not find evidence of negligence on its part.
There is overwhelming evidence showing that A/C 3506 belonged
to the appellant.
Although it is remotely possible that Lagara and Mukasa could have opened it
without authority of the appellant,
an examination of the account disproves the
hypotheses. Moreover, the appellant have easily disowned the account by
producing evidence
to the contrary."


This passage of the judgment in my opinion clearly indicates that the learned
Justices of Appeal, as the first appellate court, re-evaluated
the evidence on
record, as they were bound to do, and reached their own conclusions to the
effect that account 3506 belonged to the
appellant and that the respondents did
not receive their money banked on the account 3506, due to the action of the
appellant's employees,
Lagara and Mukasa. The appellant is vicariously liable
for the conduct of his employees in this matter. Whether the appellant's
employees
in question acted negligently or fraudulently within the scope of
their employment, the appellant was liable to the respondents for
their action:
Lloyd Vs. Grace. Smith & Co (1912) AC 716.
(HL).


The Court Appeal's conclusions, in my
opinion, are justified. The conclusions also agreed with the points made by the
appellants in
his submissions on ground one of the appeal and are consistent
with the arguments made in the respondent's submission in opposition
to the same
ground of appeal.

Like the learned trial judge, the learned Justices of the Appeal did not
find, rightly in my view, that the Bank was negligent, because
the Appellant did
not prove such negligence on the part of the Bank.

It is a well-settled legal principle, embodied in Rule 29 (1) of the Court of
Appeal Rules, that on a first appeal, the parties are
entitled to obtain from
the appeal court its own decision on issues of fact as well as of law. Although
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 inferences and conclusions: See
Coghland Vs. Cumberland (1898) 1 ch. 704 (Court of Appeal of England): and
Pandya V R. (1957) E.A 336)
. The authorities also state that a second
appellate court will not interfere with the findings of fact by the first
appellate court.
It will do so only where the first appellate court has erred in
law in that it has not treated the evidence as a whole to that fresh
and
exhaustive scrutiny which the appellant was entitled to expect. See also
Shartilal M. Ruwala Vs R (Supra) Kifamunte Henry Vs. Uganda. Criminal Appeal No.
10/97 (SCU) (unreported) Bogere Moses
Vs. Uganda, Criminal Appeal 1/97 (SCU)
(unreported).

In the instant case, I am unable to fault the Court of Appeal in what it did
as a first appellate court in its re-appraisal of the
evidence.

The appellant relied on certain authorities in support of his arguments on
ground one. Regarding Maurice Megrah & F.K. Ryder on
Paqet's Law of
Banking
(Supra) the appellant contended that the Bank ought to have known
that the Administrator General's account was a trust account. As
these were
trust funds the Bank would be held liable for parting with the money to a third
person, even on a cheque if circumstances
were such that it could have known it
constituted a misapplication of the funds, albeit without personal benefit to
the Bank. In
my view that statement of the law is not relevant to the instant
case, because the cheque was paid in the appellant's account and
withdrawn by
the appellant's employees. The bank did not pay the moneys to a third
party.

I am unable to find all the decided cases in the Law Reports cited in the
appellant's submission. Consequently, I am unable to comment
on
them.

In the circumstances ground one of the appeal should fail.

Ground two of the appeal, in my view, is really the same as ground one,
except that it is worded slightly differently. For that reason
the appellant's
arguments in his submission in support thereof appear to be repetitions of the
arguments it made in respect of ground
one. The arguments were also well
considered by the Court of Appeal. In the circumstances, I think that the
reasons and conclusions
I have made in this judgment regarding ground one,
equally apply to the second ground. I shall, however comment only briefly for
the sake of clarification on the issue of the third party notice which the trial
court granted on the appellant's application.

The appellant contends that by virtue of the third party notice, the Bank
should have been held liable for loss of the respondent's
money, which they did
not receive.

The third party notice was issued under rule 14 of Order 1 of the Civil
Procedure Rules. It was issued against Mr. Lagara and the
Bank. The grounds of
the third party notice were that:





"(a) The defendant claims to be indemnified by the third parties against
liability because the Administrator General has never either
himself and/or
through his authorized agents /servants received any money from anybody and
converted the same to his use.


(b) It was Mr. Lagara and the Uganda Commercial Bank who received and
converted to their use the money mentioned in the
plaint".


According to the affidavit of service, only the Bank was served with the
third party notice. Lagara was not. The Bank did not enter
appearance, nor file
a defence. In the result, under the provisions of rule 15 of order 1 of the
C.P.R. the Bank was deemed to admit
the validity of the decree obtained against
Administrator General as the defendant and the Bank's own liability to
contribute or
indemnify, as the case may be, to the extent claimed in the third
party notice.

The Bank having defaulted in entering appearance, it appears that the
appellant could have proceeded under rules 16 and 17 of order
1 of the C.P.R. to
obtain the remedy of indemnity against the Bank, but it has not. May be it is
not yet too late for the appellant
to consider doing so. This is only a
suggestion for it to consider in its absolute discretion.

In the circumstances, the second ground of appeal should also
fail.

On the third ground of appeal the appellant's submission is that the learned
Justices of Appeal misdirected themselves by applying
a wrong formular called
FUTURE VALUE INTEREST
FACTOR (FVIF), and awarded damages which were
excessive. The interest rate of 10% on which the formular was based was too
high. Further
the Currency Reform Statute should have applied to the principal
sum payable to the respondents by a reduction of two zeros therefrom.
It is also
submitted for the appellant that the award of Shs: 100.000,000= to the
respondents as general damages was too excessive.
It is contended that award of
damages should have been to put the aggrieved parties to the position in which
they should have been,
had it not been for the wrong they had suffured, but not
to make profit out of their misfortune.

Under the third ground of appeal, the respondents' advocates submitted that
the award to the respondents of Shs; 424,891,540/= by
the Court of Appeal was
not excessive. The formular on which the Court of Appeal relied to reach that
figure, namely "Future Value
Interest Factor (FVIF)" is
scientifically calculated and can be accessed on computer Processed Finance
Tables. Since this is a matter which can
be scientifically proved the
respondent's advocates urged us to take judicial notice of it under sections 54
and 55 (2) of the Evidence
Act, and apply the formular and the rate of interest
of 10% per annum as the Court of Appeal did. The respondent's advocates
submitted
that the provisions of the Currency Reform Statute 1987, do not apply
to the instant case. Firstly because it was a temporary legislation
and not
meant to have permanent status. That is why it was subsequently repealed in
2000. Secondly, because section 2 of the Statute
related to transactions after
the Statute came into force, not before that. In the instant case when the
statute came into force,
on 15/5/1987, the respondent's money had already been
miss-appropriately. Thirdly an application of the Currency Reform Statute would
have reduced the amount of Shs: 83.995,560/= which had been due to the
respondents to Shs: 839,956/=. This would have resulted into
a travesty of
justice and caused great injustice to the respondents, many of whom were minors
at the time their interest was abused
by the appellant.

The Court of Appeal held the view that the provisions of the Currency Reform
Statuted (Repeated) did not apply to the instant case.
I agree with that
view.

It is trite law that an appellate court should not interfere with an award of
damages by a trial court unless the award is based on
an incorrect principle or
is manifestly too low or too high. In the instant case, the learned Justices of
Appeal interfered with
the award of damages by the trial Court and awarded a
lower figure. Be that as it may, my opinion is that the sum of Shs:
424,891,540/=,
representing the purchase price of Shs: 93,995,560/= of the
commercial building, which the appellant should have paid to the respondents
is
still too excessive. This state of affairs arose because the Hon. Justices of
Appeal used the F.V.IF. formular in assessing what
should be awarded to the
respondents. In my view, the respondents would be fairly compensated if the
award to them was assessed
by subjecting the sum of Shs: 93.995,560/= to a
factor of 10% per annum at simple interest for the period of 17 years. This is
the
period from 1986, when the suit cheque was paid to the appellant's account
to May 2003, when the Court of Appeal varied the trial
Court's award of damages
to the respondents. This plus the principal would yield the amount payable under
this item to Shs: 226.788,012/=
(of which Shs; 142,792,452/= is accrued
interest).

The award of general damages of Shs; 10.000,000/= to each of the respondents,
making a total of Shs; 100.000,000/=, awarded by the
Court of Appeal to all the
respondents was, in my opinion fair in the circumstances of the case. It is not
excessive. I would not
interfere with that item of the award. In the result I
would make a total award of Shs: 326, 788,012/=, payable to the respondents.
This sum should carry interest at 6% (the Court rate) from 7/7/2003, the date of
the Court Appeal judgment till payment in full.
The third ground of appeal
should, therefore succeed.

In the result, this appeal should partially succeed. I would set aside the
orders of the Court of Appeal and substitute them with
the following:

a) The appellant should pay to
the respondents Shs: 326,788,012/=, plus interest at 6% from 7/7/2003, until
payment in full.
b) The respondents should have
three quarters of the cost of this appeal and of the costs in the trial Court
and the Court of Appeal.



JUDGMENT OF TSEKOOKO, JSC.

I have had the advantage of reading in draft the judgment prepared by my
learned brother, the Hon. Mr. Justice Oder, JSC, and I agree
with the orders he
has proposed in his judgment.

Because of the opinion of Justice Twinomujuni, JA, regarding the evidential
value of a report compiled by O/SP.J.B Kaunda, I would
like to say something on
the essence of the holding of a scheduling conference before trial in civil
suits and the consequence of
agreements or disagreements reached on certain
matters by parties at such scheduling conference.


In the Court below,
the Hon. Mr. Justice Twinomujuni, JA, wrote the lead judgment with which the
other members of the court concurred.
While discussing submissions made on the
first ground of appeal, the learned Justice of Appeal referred to a document
dated 24/2/1994
compiled by D/SP. J.B. Kaunda, of CID, Frauds Section, which was
among the documents agreed upon on 4/11/99 between the parties at
the scheduling
conference that was presided over by the learned trial judge, Bbossa, J,. In his
judgment, the learned Justice of
Appeal referred to the document in the
following words: -

"It is not marked as a court exhibit and D/ASP Kaunda did not give
evidence in court. The report suggest that the A/C. No.3506 did
not belong to
the Administrator General but to the Registrar General. It does not explain,
however, Lawrence Lagara and J.B. Mukasa
both of whom were accountants of the
appellant could have been signatories of the account. In my view, the report
has no evidential
value and its contents which were not tested in
court cannot be relied upon."



With the greatest
respect to the learned Justice of Appeal, I think that this was a misdirection
on the evidence. As a matter of fact
the document was admitted in evidence
during the scheduling conference as part of "agreed documents" No.5
entitled-

"A report from the Criminal Investigation Department Police Headquarters
reference CID/8/FRAUDS dated 7th March,
1994."



The report was sent by the CID Hqtrs. to
the Administrator-General, (the appellant) under cover of letter reference
CID/8/FRAUD dated
7/3/1994 to which that report was attached as stated in the
first paragraph of the said letter. The trial Court record shows that
at the
scheduling conference, five documents were admitted and the trial judge numbered
them as exhibits "1 to 5". A scrutiny of the numbering of the "agreed
documents" shows that the said covering letter together with the report
constitute exhibit.5.

I would like to point out that the scheduling conference must have been held
in accordance with the requirements of Order XB Rule I of the Civil
Procedure Rules.
As far as relevant, that rule states: -

"1(1)(a) Within seven days after the order on
delivery of interrogatories and

discoveries has been made under rule 1 of Order X; or

(b) Where no application for interrogatories and discoveries has been
made under rule 1 of Order X, then within twenty-eight days
from the date of the
last reply or rejoinder referred to in subrule(5) of rule 18 of Order VIII,the
court shall hold a scheduling
conference to sort out points of agreement and
disagreement, the possibility of mediation, arbitration and any other form of
settlement
"





(2) Where the parties reach an agreement, orders shall immediately be made
in accordance with rules 6 and 7 of Order 13"

Rules 6 and 7 of Order 13 empower court to, inter alia, frame issues
on agreed matters and enter judgment after due trial.

As I understand these provisions, their purpose is to enable parties to agree
on non-contentious evidence such as facts and documents.
The agreed facts and
documents thereafter become part of the evidence on record so that
they are evaluated along with
the rest of the evidence before judgment is given.
Indeed in as much as they are admitted without contest, the contents of such
admitted
documents can be treated as truth, unless those contents
intrinsically point to the contrary, and if they are relevant
to any
issue, their admission disposes of that issue because the need for its proof or
disproof would have been disposed of
by the fact of admission. Having perused
the report of D/SP/Kaunda, I cannot say that that report had no
evidential
value. The trial judge may have omitted to pronounce herself on
the report but that can not be a basis for an appellate court
to ignore such
evidence. Fortunately, in this appeal, even if the report was
taken into account as evidence, it
would not affect the result of our decision.
The pity of it, of course, is that the Administrator-General's Officers,
for unclear
reasons, chose to be lukewarm about the role of the
Uganda Commercial Bank in the scam of the diversion of such
colossal sums of
money. I will not go beyond the opinion expressed in his judgment by Oder,
JSC, on the point of how the appellant
can go about the matter. I concur in the
orders proposed by Order, JSC.


JUDGMENT OF KANYEIHAMBA, J.S.C.

I have had the benefit of reading in draft the judgment of my brother Oder,
J.S.C, and I agree with him that this appeal ought to
succeed partially. I also
agree with the orders he has proposed.

JUDGMENT OF KAROKORA. JSC

I have had the benefit of reading in draft the Judgment prepared by my
learned brother, the Hon. Justice Oder, JSC and agree with
him that the appeal
should partially succeed. I also agree with the orders he has proposed. I have
nothing useful to add.

JUDGMENT OF ODOKI, CJ

I have had the advantage of reading in draft the judgment prepared by my
learned brother, Oder JSC, and I agree with him that this
appeal should
partially succeed.

I also agree with the orders he has proposed.

As the other members of the Court agree with the judgment and orders of the
learned Justice of Supreme Court, there will be orders
in the terms proposed by
him

Dated at Mengo this 12th day of October
2004.