[2025] UGCommC 72

## THE REPUBLIC OF UGANDA

# IN THE HIGH COURT OF UGANDA AT KAMPALA

## [COMMERCIAL DIVISION]

# **MISCELLANEOUS APPLICATION NO. 2890 OF 2023**

# (ARISING FROM CIVIL SUITS NO. 0182 OF 2009)

BATANDA STEPHEN:::::::::::::::::::::::::::::::::::

#### **VERSUS**

# **BOLLORE AFRICA LOGISTICS LIMITED::::::::::::::::::::::::::RESPONDENT**

# **BEFORE: HON. LADY JUSTICE ANNA B. MUGENYI**

#### **RULING**

This application was brought by way of notice of motion under section 98 of the Civil Procedure Act (CPA), Order 52 rules 1 and 2 of the Civil Procedure Rules(CPR) for orders that:

- 1. Execution of the decree and orders in civil suit no. 182 of 2009 be stayed pending the determination of civil appeal no. 94 of 2017 in the Court of Appeal - 2. Costs abide in the final outcome of the appeal

This application was supported by the affidavit of Batanda Stephen and opposed by the affidavit in reply of Margaret Nakakande.

### **BACKGROUND**

The facts giving rise to this application are that the applicant filed civil suit no. 182 of 2009 in this court against the respondent claiming Ugx $284,412,016/=$ as special damages for alleged breach of an employment contract and the same was dismissed on the 25^th January 2017 with costs to the respondent. The applicant appealed against the judgment to the Court of Appeal vide civil appeal no. 0094 of 2017.

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The respondent filed its bill of costs which was taxed by the registrar at Ugx $46,902,528$ and the applicant has never paid the amount under the bill of costs.

The applicant now contends that the respondent filed a bill of costs which was taxed and notice to show cause why execution should not issue has been issued. The applicant contends that the respondent intends to execute by attachment and sale of his plot of land at Komamboga where he intends to construct his family home and he will suffer substantial loss if this land is sold as he will not be able to get such land.

The respondent however contends that this application is an abuse of the court process and the purported appeal to the Court of Appeal is frivolous, and incompetent in so far as the applicant has no valid claim against the respondent for payment in lieu of notice. The respondent avers that it has been six years since the applicant filed the appeal but no further steps have been taken to set the appeal down for hearing.

The respondent further contends that the applicant has not demonstrated how he will suffer irreparable loss and mere inconvenience does not amount to irreparable loss. The respondent further contended that the applicant ought to have given security for due performance.

## REPRESENTATION

The applicant was represented by M/s Nambale, Nerima & Co Advocates & Solicitors whereas the respondent was represented by M/s Fides Legal Advocates.

#### DECISION

I have carefully read the pleadings of the parties and listened to the submissions of counsel in this matter.

The spirit behind courts granting a stay of execution pending an appeal was discussed in the case of Lawrence Musiitwa v Itobu Margret HCMA No. 0160 of 2022 where it was held that:

"An Application for stay of execution pending an appeal is designed to preserve the subject matter in dispute so that the right of the appellant who is exercising his

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undoubted rights of appeal are safeguarded and the appeal if successful is not rendered nugatory."

Order 43 rule 4(2) of the CPR provides that where an application is made for stay of execution of an appealable decree before the expiration of the time allowed for appealing from the decree, the court which passed the decree may on sufficient cause being shown order the execution to be stayed.

Parties seeking a stay ofexecution pending appeal should be prepared to meet the conditions set in order 43 rule 4(3) of the CPR which provides that:

" No order for stay of execution shall be made under sub rule ( ^I) or (2) of this rule unless the court making it is satisfied-

(a) That substantial loss may result to the party applyingfor stay of execution unless the order is made;

(b) That the application has been made without unreasonable delay; and

(c) That security has been given by the applicant for the due performance of the decree or order as may ultimately be binding upon him or her."

In the case of Ntege Mayambala v Christopher Mwanje HCMA No.7211991, it was held that all the conditions laid down by Order 43 rule a (3) of the Civil Procedure Rules must be fulfilled before execution can be stayed. The rationale for these conditions is to maintain the status quo and maintain that the purpose of the application is not to defeat justice by delaying tactics and to prove that the judgment debtor is serious with his application for stay of execution.

The above conditions for grant of stay of execution were expounded in the case of Hon Theodore Ssekikubo & others v Attorney General & others Constitutional Application No. 03 of 2014 and these include:

- a) The Applicant must show that he lodged a Notice of Appeal - b) That substantial loss may result to the Applicant unless the stay of execution is granted - c) That the Application has been without unreasonable delay

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d) The Applicant has given security for the due performance of the decree or order as may be ultimately be binding upon them

In the case of Kyambogo University v Prof. Isiah Omolo Ndiege, C. A. C. A No. 341 of 2013 Justice Kakuru observed that in an application for stay, the applicant must prove in addition to other grounds:

- a) That there is a serious and imminent threat of execution of the decree or order and - b) That refusal to grant the stay would inflict greater hardship than it would avoid

Having taken cognizance of the above principles, I will therefore apply the same in the determination of this application.

#### Whether there is a notice of appeal $i.$

A memorandum of appeal marked as annexure A to the applicant's affidavit in support is seen to have been filed on the 26^th May 2017 vide civil appeal no. 0094 of 2014 at the Court of Appeal.

I therefore find that there is a validly filed appeal at the Court of Appeal.

#### Whether the appeal is not frivolous and has a likelihood of success ii.

Counsel for the applicant submitted that the grounds of appeal require a reevaluation of the employment laws and procedures for termination of the applicant as an employee. The applicant further submitted that the conferencing notes attached show that the appeal raises serious grounds that need to be addressed by the Court of Appeal.

Counsel for the respondent submitted that the intended appeal is frivolous and lacks merit as the grounds raised in the memorandum of appeal are not only misconceived but do not disclose any arguable issues worth traversing on appeal.

In the case of Junaco (T) Limited & Others v DFCU Bank Ltd HCMA No. 27 of 2023 Justice Mubiru while dealing with this ground stated that:

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"The court must be satisfied that the prospects of the appeal succeeding are not remote but that there is a realistic chance of succeeding. More is required to be established than there is a mere possibility of success. That the case is arguable on appeal or that the case cannot be categorized as hopeless. There should be a sound, rational basis, founded on the facts and the law, and a measure of certainty justifying the conclusion that the appellate court will differ from the court whose judgment has been appealed against; that the appellate court could reasonably arrive at a conclusion different from that of the trial court".

## He further stated that:

"The appeal will be considered frivolous if prima facie the grounds intended" to be raised are without any reasonable basis in law or equity and cannot be supported by a good faith argument. If there is a strong showing that the appeal has no merit, that is strong evidence that it was filed for delay or not in good faith. Additional evidence indicating a frivolous appeal is the applicant's conduct of prior litigation which may show that the appeal is merely part of a series of suits, applications and appeals over the same subject matter in which the applicant has engaged with no success or no chance of success. The prior litigation or procedural history can be used to establish the lack of merit in the present appeal or the bad faith of the applicant in filing the present appeal".

In the instant case the applicant raised two grounds of appeal in his memorandum of appeal namely that:

The learned trial judge erred in law and fact when she failed to properly evaluate the evidence on record and the learned trial judge erred in law and fact when she failed to award the appellant any remedies for termination of his employment.

The applicant attached their scheduling memorandum where they did refer to the arguments they intend to raise in support of those grounds as follows:

1) The trial judge correctly found that the applicants' assignment to work in SDV Transami Tanzania did not constitute termination but was mere

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redeployment and as such he ought to have awarded terminal benefits in Uganda.

- 2) The applicant's employment has never been formerly terminated leaving him in suspense. - 3) The letter of termination from SDV Transami Tanzania stated that he would be given notice as per Ugandan laws but the same was not given, hence the requirement for notice or payment in lieu of notice was not adhered to.

From the assessment of the arguments they intend to raise, these were all issues that were traversed and addressed by this court in the main suit. The court noted that the applicant's assignment to Tanzania was not termination but redeployment. The court further noted that the applicant's assertion that he should have been taken back to work was overtaken by his termination from employment by the group headquarters that appointed him in the first place.

I do not find any arguable case on appeal as the court properly evaluated the evidence on record and came to its conclusion.

This court also takes cognizance of the fact that this appeal was filed on the 266 May 2017 and the applicant filed their scheduling memorandum on the 1Oth July 20 I 7 and over six years later the appeal has not been fixed for hearing by them. This clearly shows inaction and dilatory conduct on their part. A litigant has the duty to follow up on their case diligently and to ensure that the same is fixed and heard.

This ground therefore fails.

#### t. Whether the Application has been made without unreasonable delay

Applications for stay of execution must be made without unreasonable delay and what constitutes unreasonable delay depends on the facts ofeach case.

In the instant case, the judgement was delivered on the 25th January 2017 and the notice to show cause was issued on the 27th October 2023 which was the time when the imminent threat ofexecution became apparent. This application was filed on the 29th November 2023 which is a month after the threat for execution became apparent.

I, therefore find that this application was made without any unreasonable delay.

tv. whether there is a serious or imminent threat of execution of the decree if the application is not granted

In the case of Baguma Paul T/A Panache Associates v Eng. Karuma Kagyina HCMA No. 460 of 2020, Justice Musa Ssekaana while citing the case of Orient Bank Ltd v Zaabwe & Others HCMA No. t912006 stated that:

"The general rule is that courts should not order a stay where there is no evidence of any application for execution of the decree. ' '

In the case of Formula Feeds Ltd v KCB Bank Ltd HCMA No. 1647 of 2022 Justice Stephen Mubiru stated that:

"An order of stay will issue only if there is actual or presently threotened execution. There must be a direct and immediate danger of execution of the decree. There should be unequivocal evidence showing that unconditional steps as to convey a gravity ofpurpose and imminent prospect of execution of the decree, have been taken by the respondent. Steps that demonstrate a serious expression ofan intent include; extracting the decree. presenting and having a bill o-f costs taxed. appbting.for issuance of a wa\*ant o-f execution, and issuing a notice to show cause why execution should not issue."

In the instant case, there is a notice to show cause on the record attached as annexure c to the applicant's affidavit in support. The notice to show cause is seen to have been issued by the registrar on the 27s October 2023 requesting the applicant to appear on the 13'h December 2023.

I therefore find that there is an imminent threat of execution of the decree.

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## Whether substantial loss may result to the Applicant unless the stay of $\mathbf{v}$ . execution is granted

The applicant contends that the respondent has applied for execution by attachment of his plot at Komamboga where he intends to construct his family home and once execution issues, he cannot get any similar land in the area.

The respondent contends that the decree in issue is a money decree arising out of a taxed bill of costs upon the applicant's case being dismissed. That the applicant has not proved that the taxed costs once paid to the respondent will not be paid back to him in case the appeal succeeds.

In the case of Tanzania Cotton Marketing Board v Coqecot Cotton Co. SA (1995-1998) 1 E. A 312 where Lubuva, J cited with approval the Indian case of **Bansidhav v Pribku Dayal AIR 41 1954** it was stated that:

"It is not enough to merely repeat words of the code and state that substantial loss will result; the kind of loss must be specified, details must be given and the conscience of the court must be satisfied that such loss will really ensue. The words substantial loss cannot mean the ordinary loss to which every judgment debtor is necessarily subjected when he loses his case and is deprived of his property in consequence. That is an element which must occur in every case and since the law expressly prohibits stay of execution as an ordinary rule, it is clear the words 'substantial loss' must mean something in *addition to all different from that.''*

Further, in the case of Formula Feeds Ltd v KCB Bank Ltd(supra), Justice Mubiru stated that:

"The loss ought to be of a nature which cannot be undone once inflicted. The court has to balance the interest of the applicant who is seeking to preserve the status quo pending the hearing of the appeal so that his or her appeal is not rendered nugatory and the interest of the respondent who is seeking to enjoy the fruits of his or her judgment".

The trial Judge went on to find that:

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"For that reason, execution of a money decree is ordinarily not stayed since the satisfaction of a money decree does not amount to substantial loss or irreparable injury to the applicant, where the respondent is not impecunious, as the remedy of restitution is available to the applicant in the event the appeal is allowed. The respondent has not been shown to be impecunious nor the fact that execution of the decree will have any irreversible effect. The applicants have failed to prove this requirement too, as far as recovery of the monetary award is concerned."

In the instant case, the bill of costs was taxed at Ugx 284,412,016/ $=$ which is a money decree. Though the applicant contends that the respondent intends to execute by selling his land and that it will be hard for him to get such land in the area, this court is alive to the fact that the words substantial loss cannot mean the ordinary loss to which every judgment debtor is necessarily subjected when he loses his case and is deprived of his property in consequence.

The respondent has not been shown to be impecunious and in case of the appeal succeeds, they can pay the money back and the applicant buys another plot of land.

This ground therefore fails.

vi. Whether security has been given by the applicant for the due performance of the decree or order as may ultimately be binding upon him or her.

Depositing security for due performance was addressed in the case of **Kisaalu** Joseph & 10 others v Nakintu May & Anor Miscellaneous Application No 105 of 2020 where Honorable Lady Justice Victoria Nakintu added that:

"The condition requiring an applicant to deposit security for due performance is established under Order 43 Rule 4 (3(c). Security for due performance has been interpreted to mean the entire decretal sum and it is intended to protect the judgment creditor in the event that the appeal is unsuccessful. Courts though have been reluctant to order security for due performance of the decree. Rather Courts have been keen to order

security for costs because the requirement and insistence on a practice that mandates security for the entire decretal amount is likely to stifle appeals."

Due to the complications associated with security for due performance as discussed above, courts have resorted to making orders for the award of security of costs.

The purpose of paying security for costs was discussed in the case of Nkonge Rugadya in Shem Mpanga Mukasa & Anor v Kizza Clessy Barya, Miscellaneous Application No. 479 of 2021 by the Honorable Lady Justice Alexandra who stated that:

"The payment of security for costs is intended to operate as a shield against the filing of frivolous and vexatious appeals which may never succeed yet have an effect in escalating trial costs."

Security for costs or due performance of the decree therefore operates as an insurance cover that is meant to indemnify the judgment debtor in the event the appeal fails without recourse to vigorous processes of recovering such costs (Wandera Micheal v Baguma Samalie Miscellaneous Application No. 36 of 2021).

Counsel for the applicant contends that there is no decretal sum but only taxed costs and as such no need of security for due performance. Counsel went on to submit that if the court is inclined to grant security for costs then it should be 10% as it was in the case of Baguma Patrick v Sanyu Phiona SCCA No. 452 of 2023.

This court acknowledges the fact that the main suit was dismissed with costs and that the respondent filed a bill of costs that was taxed and which they now intend to execute. Security of costs is intended to operate as a shield from filing frivolous appeals.

In the instant case, the applicant has not deposited any security for costs as required.

This ground therefore fails

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## vii. That refusal to grant the stay would inflict greater hardship than it would avoid

Save for the averments that the applicant will lose land where he intends to build his family home and that he might not be able to get such land in the area again' the applicant has not adduced any evidence to this effect or to show that execution will cause great difficulty/hardship or disruptions beyond which every judgment debtor is subjected to when they lose a case.

I therefore have not found evidence to show that the execution would cause significant difficulty, expense or disruption, beyond that to which every judgment debtor is necessarily subjected when he or she loses his or her case and is deprived of his or her property in consequence

As such, I therefore find that the applicant has also failed to demonstrate to this court that the refusal to grant the stay would inflict greater hardship than it would avoid.

In conclusion and from all the fore going, I find that the applicant has failed to satisf, some of the essential requirements for the grant of an order of stay of execution pending appeal.

Consequently, this application fails and is hereby dismissed with costs to the respondent.

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HON. LADY JUSTICE ANNA B. MUGENYI DATED r0 2. )<'I

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