[1996] UGCA 7

## THE REPUBLIC OF UGANDA

# o IN THE COURT OF APPEAL OF UGANDA

# AT KAMPAI-A

# CIVIL APPLICATION NO. 16 OF 1996

# (CORUM: MANYINDO. D. C.. I., KATO,. I., & BERKO,. I.)

# DEGEYA TRADING STORES (T. I) LTD APPLICANT

#### VERSUS

# UGANDAREVENUEAUTHORITY ........... RESPONDEN (An application against the ruling of Lugayizi, J. in H. C. C. S. No.938/93 delivered on 07110196)

### RULING OF THE COURT

This is an application for leave to appeal to this court. The application is by a notice of motion dated 21110196. It was filed by the applicant Degeya Trading Stores (U) Ltd. under the provisions of rules l(3), 39(b), 42 and 43 of the Supreme Court Rules which are applicable to this court by virtue of section l4 of the Judicature Statute 1996 (Statute No.13). The application was supported by the affidavit of Eric Muhwezi the learned counsel for the applicant. The respondent's counsel Dr. Bakibinga also swore to an affidavit, which was in form of a tegal argument, in reply. On 18/11/96 this court after listening to the submissions from both sides allowed the application with costs to the aF,plicant and made an order that the applicant files its appeal within 14 days from that date but we reserved our reasons for the decision. We now proceed to give the reasons.

The brief facts giving rise to this application are these: The present applicant was the

second ..,.;,.,rdant in High court civil Suit No.938 of 1993 in which the respondent was the first defendant. The plaintiff was M/s. Obadi Enterprises Ltd. The suit was in respect of an illegal seizure of some goods. The present applicant put in a counterclaim against the respondent and the plaintiff. He won the counterclaim against the respondent with costs but lost it in favour of the plaintiff with costs. The applicant then filed a bill of costs and both counsel agreed as to the amount which was to be recorded in favour of the applicant. The Registrar recorded the agreed costs. After that cons€nt taxation order had been recorded the respondent applied to the Registrar to review the same but the Registrar refused on the ground that this was a consent order which was not I subject to review. After the Registrar's refusal the respondent made an application by notice of motion to the High Court under Section l0l of Civil Procedure Act and Order 48 of Civil Procedure Rules requesting the High Court to set aside the consent order entered by the Registrar.

o

At the hearing of that application the counsel for the present respondent relied on section 84 of Civil Procedure Act and prayed for a revisional order to be made. The High Court allowed the application on the ground that the Registrar had acted with injustice because the taxation had been based on the subject matter of the suit instead of being based on the decretal sum and the costs had been "inflated, repeated and bogus". The trial judge accordingly set aside the consent order regarding the cosls and ordered that a fresh bill of costs which was reasonable be presented to the court. The learned counsel for the present applica::, 1-.:',:rrever, was not happy with the Judge's order. He therefore applied orally for leave to appeal against that ruling but his oral application was rejected. He consequently brought the instant application.

In the course of his argument Mr. Muhwezi learned counsel for the applicant contended that the learned trial judge misapplied or misconstrued the true meaning of sections

84 and l0l of Civil Procedure Act and principles governing costs as contained in the Advocates (Renumeration and Taxation of Costs) Rules in particular schedule 6 1(a)(4) to those Rules. According to him it was wrong for the Judge to hold that the instruction fee should have been based on the decretal sum and not on the value of the subject matter. It was his contention that instruction fee should be based on the subject matter of the suit but not on the decretal sum awarded. In support of that contention he relied on the case of: Makula International v Cardinal Nsubuea (1982) HCB o.11 He further maintained that it was wrong for the trial judge to set aside taxation which had been arrived at by consent of both parties. According to him the bill of costs which was being disputed concerned only instruction fee. The other items were not in dispute. In his view it was wrong for the judge to have quashed the whole bill when the whole of it was not being disputed.

o

Mr. Muhwezi was also of the view that it was wrong for the trial judge to award costs against the present applicant without giving reasons. On the issue of what procedure should he followed when setting aside a consent order he relied on the case of: Libvan Arab Bank v Adam Vassiliadis Supreme Court Application No.l4l91. In that case it was decided on the authority of the case of: Brooke Bond v Mallva [19751 EA 266 that the Procedure to be followed by an applicant who wishes to set aside a consent order is that he should either apply to set aside the consent order in the same proceedings, or bring a fresh suit to set it aside. Either procedure would proceed upon the basis that the parties had entered into an agreement, which could only be set aside on such grounds as would allow him to set aside a contract. According to Mr. Muhwezi all these points raised above were important points of law which required the determination of this court. He therefore prayed that leave be granted to him to appeal with costs.

J

Dr. Bakibinga for the respondent argued that the right to appeal will only be allowed on points of law and if one can show that the appeal is likely to succeed on those points. According to him Schedule 6 1(a)(a) to the Advocates (Renumeration and Taxation of Costs) Rules as amended by statutory instrument No.3 of 1996 shows that the fee to be paid to an advocate has to be based upon either the amount claimed or the decretal amount. In his view the judge was right to base his decision on the decretal sum since the amount in the counterclaim was speculative in respect of some items. Nevertheless he felt that this was not a good point of law requiring an appeal. He further argued that the judge had power to call for a file under section 84 of Civil Procedure Act and quash the order of the taxing officer. In his view the intended appeal is incompetent considering the reasons given by the judge in his ruling and in view of the contents of Schedule 6 l(a)(lv) '{ to the Advocates (Renumeration and Taxation of Costs) Rules and the decision in the case of: Brooke Bond v Mall),a (1975) E4266. Dr. Bakibinga further submitted that the judge was quite right when he refused to grant the applicant leave to appeal. He therefore, prayed that the applicant's application for leave to appeal be dismissed with costs.

o

An applicant seeking leave to appeal must show either that his intended appeal has a reasonable chance of success or that he has arguable ground of appeal and he has not been guilty of dilatory conduct.

As to whether the intended appeal has chances of success we can only at this stage say that there are matters of law that merit consideration on appeal. These include the questions whether a consent order entered by the taxing officer can be set aside by a High Court Judge and if the answer is in the affirmative, whether the correct procedure was followed in this case; whether the Advocate's instruction fee should be based on the value of the subject matter or on the decretal sum and whether it is lawful for a court to award costs greater than the decretal sum.

It was for these reasons that we allowed the application.

Dated at Kampala this 13 day of Decumber 1996.

id $...$

THE HON. JUSTICE MANYINDO, D. C. J. THE HON. JUSTICE C. M. KATO THE HON. JUSTICE J. P. BERKO

$\mathbf{J}$