[2025] UGHCLD 81

## **THE REPUBLIC OF UGANDA IN THE HIGH COURT OF UGANDA AT KAMPALA [LAND DIVISION] CIVIL SUIT NO. 384 OF 2022**

**LAKAI UNIFORMS LIMITED ::::::::::::::::::::::::::::::::::::::::::::::::: PLAINTIFF**

## **VERSUS**

- **1. SSEKATAWA V. MATHIAS** - **2. ROSE AGNES WASSWA**

**3. JOHN SSEMPEBWA**

**(ADMINISTRATORS OF THE ESTATE OF THE LATE PAUL WASSWA)**

- **4. KIWA INDUSTRIES LTD** - **5. MARY KIZITO KISITU** - **6. THE COMMISSIONER LAND REGISTRATION :::::::::::::::: DEFENDANTS**

## **BEFORE: HON. LADY JUSTICE NAKIGANDA IDA**

## **RULING ON PRELIMINARY OBJECTIONS**

## **Introduction**

- 1. This is a Ruling in respect to a preliminary objection that was raised by the Defendants' counsel at the scheduling of the case to wit: that the suit is barred by limitation; that the suit ought to be stayed pending the payment of cost in HCCS NO. 97 of 2021; and the 1st to 3rd defendants are entitled to judgment on admission. - 2. In reply to the Defendants' preliminary objection counsel for the Plaintiff raised a preliminary objection asserting that a preliminary objection cannot be raised premised on facts that are in dispute or issues which have to be ascertained by Court.

## **Background**

- 3. The Plaintiff filed this suit against the Defendants upon a claim for fraudulent transfer of the plaintiff's land comprised in LRV 1829 Folio 22 Plot M404 and LRV 1843 Folio 12 Plot M403, land at Mbuya; and illegal occupation of the said land by the 4th Defendant. - 4. According to the plaint filed on 7th April, 2022, the Plaintiff claims that in the year 1980, the Plaintiff company applied for a 99 years lease from

the Registered Trustees of the Native Anglican Church of Uganda, for land comprised in LRV 1829 FOLIO 22 Plot M404, land at Mbuya. The then Plot 404 is the current Plot M404 which is one of the plots comprising the suit land. The Plaintiff further claimed that Plot M403 was secured by a consent of the landlord (the registered Trustees of the Native Anglican Church of Uganda) around April 1985 from a one Swaibu Kizito who had also obtained it as a lease from the Registered Trustees of the Native Anglican Church of Uganda and it is the 2nd Plot comprising the suit property.

- 5. It was further claimed by the Plaintiff that on 3rd September 1981, the Plaintiff's application for a lease was accepted by the Registered Trustees of the Native Anglican Church of Uganda and the Plaintiff company obtained a 49-year lease for Plots 401,402,404,405 and 406 Volume 05 Folio 04 land at Mbuya approximately 3.9 Acres. Upon obtaining the said lease, the Plaintiff Company started paying ground rent and embarked on developing the suit land. Unfortunately, around October 1988, the then Managing Director of the Plaintiff Company died in a plane crash and upon his death the 5th Defendant (a wife to the deceased) assumed management of the Plaintiff Company and on assumption of the Management of the Plaintiff Company, the 5th Defendant teamed up with a one Paul Wasswa and the 2nd defendant who was his wife, together with another person called Lucy Bwanika (a sister to the 5th defendant) and the four incorporated the 4th defendant Company KIWA Industries in which they obtained equal shares. - 6. The Plaintiff also contended that after incorporation of the said Company the late Paul Wasswa connived with the 5th Defendant to fraudulently register himself onto the suit land as a tenant in common with equal shares with the Plaintiff company without authority/consent from the Plaintiff company and without knowledge of the landlord. It was then that the aforementioned shareholders set up the 4th Defendant company onto the suit land after which the 4th defendant company started paying ground rent in its names and utilizing the suit land


including mortgaging the same and obtaining loans from banks without authority of the Plaintiff.

- 7. That in 2005, Paul Wasswa died and the 1st, 2nd & 3rd Defendants obtained letters of administration of his estate, registered themselves onto the suit land as tenants in Common with the Plaintiff Company in the capacity of administrators vide instrument Number 364207. - 8. The Plaintiff averred that in 2019, one of the shareholders of the Plaintiff Company by the names of Joseph Ssengendo Kisitu became its managing director and on assumption of office demanded information and documents concerning the suit land from the directors of the 4th defendant Company and that is when he discovered that the land was registered in both the names of the Plaintiff company and the 1st to 3rd Defendants as tenants with equal shares. It was further discovered that the 4th Defendant company has been obtaining various mortgages using the suit land as security and it had used the said mortgages and profits from the businesses being conducted on the suit land together with rental income from the tenants occupying some stores on the suit land*.* The 1st to 4th Defendants have exclusively occupied and gained from the suit land without accounting to the Plaintiff Company with whom they purport to be tenants in common. - 9. In reply, the Defendants filed a joint written statement of defence wherein they denied the contents of the plaint and it was contended that the 1st to 3rd Defendants are the Administrators of the estate of the late Paul Wasswa who was the registered proprietor as a tenant in common with the plaintiff company for the land comprised in LRV 1829 FOLIO 22 Plots M404 & M403 land at Mbuya herein called the suit property. The Defendants averred that in 1990, the Registered Trustees of the Native Anglican Church of Uganda leased the property comprised in plot M403 for 49 years commencing the 1st of July 1981 to the Plaintiff and the Late Paul Wasswa and the said lease was on the 15th May 1990 duly registered by the lessee at the Land Registry vide instrument No. 243640 in favour of the Plaintiff and the Late Paul Wasswa as tenants in common after which plot M404 was also granted to the late Paul


wasswa as a lease and the same was on 4th of May 1990 transferred in favour of the Plaintiff and Paul Wasswa as tenants in common with equal shares.

10. The Defendant contented that before the expiry of the said leases, Paul Wasswa passed on and as a result, the 1 to 3rd Defendants were appointed as Administrators of his Estate and subsequently registered as proprietors on plots M403 and M404 as tenants in common with equal shares. The 1st to 4th Defendants maintained that the 4th Defendant is legally in occupation of the 1st to 3rd Defendants' portion of the suit land and the mortgage that was secured by the defendants on the 21st August 2006 from Stanbic Bank Uganda Limited was in respect to the 1st to 3rd Defendants' portion of the suit land.

## **Submissions**

11. Both parties filed their written submissions in respect of the preliminary objections. The submissions have been taken into consideration in determination of the preliminary objections.

#### **Representation**

12. The plaintiff was represented by Mr. Ssebowa Francis Kabali and Mr. Kalamu Lawrence of M/s Ssebowa & Co. Advocates and the 1st to 4th defendants were represented by Mr. Eriya Mikka together with Mr. Kenneth Kiapi of MMAKS Advocates.

#### **Issues:**

- i. Whether a preliminary objection cannot be raised where the alleged facts on which it is premised are yet to be ascertained and proved? - ii. Whether the plaintiff's suit is barred by limitation? - iii. Whether the plaintiff's suit ought to be stayed pending the payment of costs in HCCS No. 97 of 2021? - iv. Whether the 1st to 3rd defendants are entitled to a judgment on admission?

# **Resolution and determination of issues**

I am going to concurrently consider Issues (i) and (ii).

## **Submission of counsel to the Defendant**

*13.* Counsel submitted that the basis of the objection by the 1st to 4th Defendants is that the Plaintiff's cause of action accrued in May, 1990 and accordingly all claims related to the suit land should have been brought by June, 2002 and are accordingly statute barred by section 15 of the Limitation Act Cap 290. Counsel relied on the case of *Katakuwange V Ikanza & Another (Civil Appeal No. 75 of 2021) 2024 UGHC 348 (9 May, 2024) where court held that two major purposes underlie statutes of limitations: protecting defendants from having to defend stale claims by providing notice in time to prepare a fair defence on merits and requiring plaintiffs to diligently pursue their claim. Statutes of limitation are designed to protect the defendant from plaintiffs who fail to diligently pursue their claim. Once the time period limited by the limitation act expires, the plaintiff's right of action will be extinguished and becomes unenforceable against the defendant. It will be referred to as having become statute barred….."*

Counsel concluded that in light of the above provision, the Plaintiff's claim is statute barred as over thirty years have elapsed from the date of the cause of action in May, 1990.

Counsel further submitted that the Plaintiff had not shown any disability that resulted into institution of the suit after the lapse of limitation time as set out in Section 25 of Limitation Act Cap 290. Counsel relied on the case of *Gunya Company Ltd V Attorney General HCCS NO. 031 of 2011 where court held that where a suit is brought after expiration of the period of limitation and no ground of exemption are shown in the plaint, the plaint must be rejected*

Counsel went ahead to submit that the plaintiff has not demonstrated that they could not have discovered the fraud with reasonable due diligence in

relation to Section 25 of the Limitation Act arguing that for a plaintiff to rely on the exemption of fraud they must plead the circumstances under which the fraud was concealed by the defendant and that they could not have discovered the alleged fraud with reasonable due diligence. Further that the plaintiff is a body corporate which had officials running its affairs since 1990 and the annexures to the pleadings show that one of the transfer forms in respect of the suit property was signed and stamped by the officials of the company and thus there was no concealment by the 1st to 4th defendant.

# **Submission of counsel to the Plaintiff**

14. Counsel submitted that its trite law that where alleged facts have yet to be ascertained and proved, a preliminary objection cannot be raised in respect of them, he relied on the case of *William V Baleke Musa & Another HCCS No. 876 of 2020*. Counsel stated that the Plaintiff alleges that it discovered the fraud and acts complained about in the year 2019 which was disputed by the 1st to 4th Defendants in paragraph 1 of their joint written statement of defence and as such the question as to whether the suit is barred by limitation or not cannot be resolved as a preliminary objection because the facts as to when the act/fraud complained about were discovered by the Plaintiff and or when the limitation period started running are in issue/ dispute and the same need to be ascertained.

Counsel further submitted that the preliminary objections as to limitation and as to whether a judgment on admission should be entered against the Plaintiff ought to have been raised as issues for determination during the hearing of the suit. Counsel cited the case of *Yudaya Luta Musoke V Greenland Bank (In Liquidation) HCCS 506/2001 and Mukisa Biscuits Vs. West End Distributors Ltd [1969] 696.*

In respect of the merit of the preliminary objection that the suit is time barred, Counsel for the Plaintiff submitted that in paragraphs 9, 10, 11, 12 & 13 of the plaint, it is averred that upon being appointed managing director in 2019, Joseph Ssengendo discovered that there was collusion between the 1st to 4th Defendants and the 5th Defendant (the former managing director in the plaintiff company), to conceal from the shareholders of the Plaintiff company the fact that the certificates of titles in respect of the suit land had been handed to 1st to 3rd Defendants , the 1st to 3rd Defendants had registered themselves as proprietors of the suit land along with the Plaintiff company and that the defendants were using the 4th Defendant to physically occupy and possess the entire suit land while keeping the Plaintiff company out of physical possession. He relied on the case of *Yudaya Luta Musoke V Greenland Bank (In Liquidation) HCCS 506/ 2001 and Mukisa Biscuits V West End Distributors Ltd [1969] EA 696,* where it was held that "*a preliminary objection raises a pure point of law which is argued on the assumption that all facts pleaded by the other side are correct…"*

That the claim filed in the year 2022 in respect of acts discovered in the year 2019 is not barred by limitation since there was collusion to conceal the said acts by the Defendants as laid out in the plaint and hence the limitation started running in 2019, when the illegalities and fraud was discovered.

## **Resolution by Court**

- 15. **Order 6, Rules 28 and 29 of the Civil Procedure Rules SI 71-1**, provides that a point of law may be set down for hearing and disposed of at any time before the hearing. If in the opinion of court, the decision of the point of law substantially disposes of the whole suit, or of any distinct cause of action, ground of defence, setoff, counterclaim, or reply therein, the court may thereupon dismiss the suit or make other order in the suit as may be just - *16.* A preliminary legal objection is a legal argument that seeks to prevent a court process from being conducted in violation of applicable law. See the holding of the supreme court of Ghana in case of *Nana Korkor Ntim V Stephanie Ansaa Opere SCA. No.14/64/2022*

17. The essence of a preliminary objection is for court to deal with matters of law on the face of the pleadings which can cause disposal of the suit without going into the merit of it. A preliminary objection aims at having the proceedings to which it relates thrown out of court as it challenges the judicial competence to entertain a particular process. In *Mukisa Biscuits Manufacturing Co. Ltd v West End Distributors Ltd (supra),* Law JA stated as hereunder,

*"So far as I am aware, a preliminary objection consists of a point of law which has been pleaded or which arises by clear implication out of pleading and which if argued as a preliminary point may dispose of the suit."*

- 18. However, a preliminary objection grounded on a point of law must not deal with facts that are disputed and are yet to be ascertained by evidence yet to be produced before court. In the case of *Yaya Farajallah v Obur Ronald &3 others CA. No. 2018***,** court observed that a preliminary objection is based on a commonly accepted set of facts as pleaded by both parties. It cannot be raised if any fact has to be ascertained or if what is sought is the exercise of judicial discretion. Preliminary objections relate to points of law presented at the outset of a case by the defence without going into the case's merits. In any preliminary objection therefore, there is no room for ascertainment of facts through affidavit or oral evidence. - 19. Justice Naluzze Aisha Batala in the case of *Sebowa Abudala Seleiman Vs Nalule Gladys (Administrator of the estate of the late Nalule Christine) HCTLD Misc. App No. 1402 of 2023* observed that anything that purports to be a preliminary objection premised on point of law must not deal with disputed facts and it must not itself derive its foundation from factual information which stands to be tested by normal rules of evidence, - 20. Order 7 rule 11(a) and (d) of the Civil Procedure Rules requires rejection of a plaint where the suit appears from the statement in the plaint to be barred by any law. - 21. The purpose of the Statute of limitation is: to protect Defendants from having to defend stale claims by providing notices in time to prepare a fair defence on merits; and to ensure that Plaintiffs diligently pursue their claims and once the time period provided under act expires, the Plaintiff's right to action will be extinguished. - 22. Furthermore, the purpose of limitation is that ligation must come to an end. Therefore, where a cause of action accrues to a person and that person fails to take advantage of it, the right must come to an end at a point in time. Although the Plaintiff can bring a cause of action, they lose the right to enforce it through the judicial process if the time provided for bringing such an action has elapsed. - 23. Section 5 of the Limitation Act Cap 290 provides for the limitation period for all matters that involve recovery of land based on title or possession as follows; *no action shall be brought by any person to recover any land after the expiration of twelve years from the date on which the right to action accrued to him or her or, if it first accrued to some person through whom he or she claims, to that person.* - *24.* The Limitation Act however provides for exceptions to Section 5 of the same act under Section 25 *which states that; where in the case of any action for which the period of limitation is prescribed by this act, the action is based upon the fraud of the defendant or his or her agent or of any person through whom he or she claims, the period of limitation shall not begin to run until the plaintiff discovers fraud* - 25. Therefore, it is conclusive that in cases involving fraud the limitation period does not accrue until the fraud is discovered by the Plaintiff. - 26. In the instant case both the Plaintiff and the Defendants by their pleadings agreed that the late Paul Wasswa from whom the 1st to 3rd defendants claim, was registered on the suit land in 1990 as a tenant in common with the plaintiff and with the knowledge the plaintiff company through persons that were running its business at the time including the

former 5th Defendant Mary Kisitu who signed the transfers and board resolution that were used to effect the transfer of the said Paul Wasswa on the suit land.

- 27. It is also apparent in the plaint, that the Plaintiff pleaded fraud on the part of its former managing director Mary Kisitu and the 1st to 4th Defendants considering the fact that both the former managing director and the 1st to 3rd Defendants are shareholders in the 4th Defendant company which has been in occupation of the suit land since 1990. In the plaint, the Plaintiff went on to disclose the particulars of fraud as, the Plaintiff company was prevented by sufficient reason of concealment of the facts from bringing an action against the defendants during the limitation period. The Plaintiff company through its now managing director alleges that the Plaintiff got to know about the fraud in 2019 when he assumed office as the managing director of the company. - 28. In conclusion therefore the facts in respect of when and how the cause of action accrued to the Plaintiff are yet to be ascertained and are subject to proof of alleged fraud by the Plaintiff which shall require further evidence since the pleadings do not satisfactorily address the same. It is evident that the court shall have to pronounce itself on the alleged fraud. It is my opinion that the suit cannot be dismissed on ground of being time barred in presence of facts and issues that require both parties to lead evidence for court to make a finding in respect of the same.

Therefore, Issue (i) is answered in the negative and the preliminary objection in issue (ii) is hereby overruled.

I now consider Issue (iii)

29. Counsel for the 1st to 4th Defendant submitted that the current suit in court is one of a number of actions that have been instituted by the Plaintiff against the Defendants. Prior to instituting this suit, the Plaintiff filed HCCS No. 97 of 2021 over the same subject matter in commercial court and it was withdrawn with costs. He relied on the case of *Jeans Humphrey V Tushabe Civil Suit No. 423 of 2010) 2021*

*UGHCLD 129* where it was held that "*courts are empowered under the evidence act to take judicial notice of the decisions of other courts"*

- 30. Counsel cited **Order 25 rule 4 of the Civil Procedure Rules** stating that the purpose of this rule is to prevent vexatious litigation and abuse of court process, to prevent defendants from being harassed by multiple suits on the same issues when costs for previous attempts remain unpaid and to enforce the court's previous order. Counsel prayed that court take judicial notice of the proceedings in HCCS No. 97 of 2021 in which costs arising there from are yet to be paid to order a stay of this suit pending payment of the costs in the previous suit. - 31. In response, counsel for the Plaintiff submitted that whoever desires court to give a judgment as to any legal right or liability dependant on the existence of fact which he or she asserts must prove that those facts exist. He relied on Section **101 (1) & 103 of the Evidence Act Cap 8** to submit that the Defendants want court to believe there is a certificate of taxation or taxed bill of costs in HCCS NO. 97 of 2021, payment of which is pending by the plaintiff which is not true.

## **Resolution by Court**

- 32. **Order 25, Rule 2 of the Civil Procedure Rules** provides that when a suit has been set down for hearing, it may be withdrawn prior to the hearing by either the plaintiff or the defendant upon filing a consent signed by all the parties. **Order 25, Rule 4** provides that any subsequent suit brought before payment of the cost of the suit of a discontinued suit upon the same, or substantially the same, cause of action, the court may order a stay of the subsequent suit until the costs have been paid for where a suit is withdrawn by consent of the parties. - 33. **Section 98 of the Civil Procedure Act Cap 282** gives court inherent powers to make such orders as may be necessary for the end of justice or to prevent abuse of court process. However, those powers must be exercised judiciously considering the specific circumstances of each case and the applicable law.

- 34. The procedure of taxation of the bill of costs is prescribed in the **Advocates (Remuneration and Taxation of cost) Regulations SI-123 Regulation 9** as amended and the same must be followed by the advocate who is to gain if his bill of costs is taxed. The Regulations provide that when a bill of taxation has been lodged, the registrar shall upon payment of the prescribed fees issue to the party lodging it a notice of the date and time fixed for taxation of the bill of costs and shall also issue a copy of notice accompanied by a copy of the bill of costs to be served to each advocate and other person whose name is endorsed on the bill as entitled to receive notice of taxation of the bill of cost and under **Regulation 53** a certificate of taxation shall be issued indicating the manner in which costs are to be paid. - 35. The mandatory rules of taxation should be followed in taxation proceedings for the good of both parties. See the case of *Attorney General V Uganda Blanket Manufacturers SCC Application No 10 of 1993* where court observed that the intention of the rules is to make a balance between the need to allow the advocate adequate remuneration for their work and the need to reduce the cost to reasonable leave so as to protect the public from excess fees - 36. In the instant case before court, counsel for the Defendants has presented an annexure of the bill of cost he filed in the Commercial Division of the High Court in November, 2021 and an order from which it arises. Unfortunately, he has not shown any satisfactory step he has taken to ensure that the said bill is taxed or set to be taxed by the taxing officer as required of him by the aforementioned Regulations. There was also no certificate of taxation presented. - 37. In that regard, I agree with the submissions of counsel for the Plaintiff that it is not fair, just and equitable for this court to exercise its discretion to order a stay of this suit pending payment costs in respect of HCCS No 97 of 2021 considering that taxation proceedings are yet to be fixed and the costs being claimed are still unascertained.

Consequently, the preliminary objection in issue (iii) is overruled and the suit before this court shall proceed.

## I will finally consider Issue (iv)

- *38.* Counsel for the 1st to 4th Defendants submitted that on 5th April 2022, prior to the institution of the present suit, the Plaintiff held a board meeting and resolved expressly that the 1st to 3rd defendants' predecessor in the title, the Late Paul Wasswa was indeed a tenant in common with equal shares in the suit land. He relied on the case of *Kibalama V Alfasan Belgle [2004] E A 146* where court held that "*under Order 11 rule 11 (now Order 12 rule 6), judgment can be entered at any stage of the proceedings where an admission of facts has been made. Such an admission, however must be unequivocal in order to entitle the party to judgment of any questions between the parties".* Counsel stated that premised on the above decision, it is clear that where an admission of a fact is clear and unambiguous, court ceases to have the discretion whether to enter a judgment or not, it must do so and by the said board resolution that was registered on the Plaintiff's register with Uganda Registration Services Bureau, the Plaintiff clearly and unequivocally admitted to the 1st to 3rd Defendants' interest in the suit land. - 39. Counsel for the plaintiff replied stating that the Board resolution alleged to contain the admissions was signed by Gwavvu Stella Mutyaba Zansanze on behalf of Anna Gwaliwa Nalumansi and the 5th Defendant who were neither directors nor share holders in the Plaintiff company. The aforementioned two people did not have the legal authority to convene or be part of the Board of Directors' meeting and the same is disputed in the plaint. He relied on the case of *Attorney General & Another V Joseph Konney & 9 others HCMA 963 of 2016*

## **Resolution by Court**

- 40. The procedure of entertaining a Judgment on Admission is provided for under Order **13 rule 6 of the Civil Procedure Rules** which states that any party may at any stage of the suits where an admission of fact has been made, either on the pleading or otherwise, apply to court for such judgment or order as upon the admission he or she may be entitled to, without waiting for the determination of the other questions between the parties; court may on such application make such order or give judgment, as the court may think just. - 41. Courts have diligently expounded on the above provision in numerous cases. In particular, Justice Boniface Wamala in the case of *John W. Katende & Another V Uganda Communications Commission HCMA 99 of 2022 citing Future Stars Investment (U) Ltd V Nasur Yusuf HCCS No. 0012 of 2017* stated that Court may rely on documents accompanying pleadings to infer an admission by the opposite party provided the alleged admission satisfies the tenets of a proper admission. The admission must be unambiguous, clear and must be unequivocal and positive and where the alleged admission is not clear and specific it may not be appropriate to take recourse under the legal provisions. - **42.** It should be noted that it is settled law that a judgment on admission is not a matter of right but one of judicial discretion and such discretion can only be exercised in plain cases where the admissions of fact are so clear and unequivocal that they amount to an admission of liability entitling the Plaintiff to judgment. See *Cassam V Sachania [1982] KLR 191***.** - 43. In the matter before me, the facts set out by the Defendants as requiring a judgment on admission are set out in one of the annexures to the plaint that is a board resolution allegedly signed by persons who acted on behalf of the Plaintiff company but the plaintiff in the same pleading questioned their capacity and locus to sign the said documents on its behalf.

44. The Plaintiff in its plaint alleges fraud on the part of one of its directors who signed on the impugned Board Resolution which fraud needs to be proved by the plaintiff through a proper hearing of the suit. In consideration of the law and the facts at hand the Plaintiff should not be deprived of its right to have this case tried through a proper trial where there will be discovery and production of oral evidence in respect of the facts in dispute. The alleged admitted facts do not meet the unequivocal and unambiguous threshold for this court to exercise its discretion to enter a judgment on admission in respect of them.

Issue (iv) is answered in the negative.

In conclusion therefore, I am convinced that whenever fraud is pleaded in the pleadings, a right accrues to the Plaintiff to prove the same at the trial of the suit. It is after evidence has been adduced through cross examination that the court can determine whether the fraud has been proved or not but not at the pre-trial stage of the suit. Basing on the law and facts as set out and evaluated herein by this court, all the preliminary objections that were raised by counsel for the 1st to 4th Defendants are hereby overruled with no order as to costs. Court will proceed to hear the suit on its merits.

I so order.

**NAKIGANDA IDA JUDGE 30th May, 2025**

**Ruling delivered on 30th May, 2025 via ECCMIS.**