[2025] UGHC 485

## **THE REPUBLIC OF UGANDA**

## **IN THE HIGH COURT OF UGANDA HOLDEN AT MBALE**

## **CIVIL SUIT NO. 05 OF 2022**

**M/S REMA (U) LTD :::::::::::::::::::::::::::::::::::::::::::::::::::::::: PLAINTIFF**

#### **VERSUS**

### **1. BUTEBO DISTRICT LOCAL GOVERNMENT**

- **2. LUYIMBAZI JAMES** - **3. NAULA BEATRICE :::::::::::::::::::::::::::::::::::::::::::::::::: DEFENDANTS**

#### **RULING ON A PRELIMINARY OBJECTION**

#### 1 **Introduction**

- 2 The Plaintiff instituted this suit against the Defendants for- - *(a) declaratory orders that the defendants acted illegally, fraudulently and outside the law in making the botched contract award to M/S Gali Technical Services Ltd and the same should be cancelled, overturned, quashed and set aside,* - *(b) declaratory orders that the procurement process be recommenced afresh, with particular emphasis upon the shortlisted bidder and applicants on record,* - *(c) declaratory orders for damages for breach of contract and breach on contractual obligations, illegal, fraudulent, unlawful and unreasonable conduct and behavior upon the part of the defendants herein,* - *(d) orders of compensatory damages for the injury, damage, loss, pains and suffering and general inconvenience suffered by the plaintiff company and their staff, spouses and families as a result of the illegal, fraudulent,*

*irresponsible and uncalled for conduct of the defendants herein,*

- *(e) permanent injunction retraining the defendants and their agents or servants from further mischief or misbehavior,* - *(f) order of specific performance,* - *(g) special damages,* - *(h) interests,* - *(i) general damages,* - (j) *Exemplary and punitive damages and costs of the suit*.

## 3 **Background:**

- 4 The Plaintiff's claim is that in 2021 the 1st defendant, Butebo district local government advertised for calls for competent applicants to apply for works for the construction of a Seed Secondary School for the district at Kachura Kabwangasi, under a World Bank funded school's development programme. That subsequent to the said advertisement dated 17th June, 2021, a number of companies applied to undertake the Seed Secondary School construction works, including the plaintiff M/Rema (U) Limited and indeed the bids for the successful applicants was opened publicly in the presence of one of the plaintiff's directors, on the 23rd July 2021 at 12:00. - 5 That the matter should have proceeded to the technical evaluation committee and later to the contracts committee but before the process could go far to the evaluation stage, His Excellence the President of Uganda issued a directive which affected the enforcement of the said process and it was halted. However, to the surprise of the plaintiffs, they later discovered that the contract was awarded to M/S Gali Technical Services without following the PPDA Rules and Regulations. - 6 The defendants however, in their written statements of defence denied the plaintiff's allegations and averred that the procurement

of services for the construction of Seed School followed the required legal procurement procedure and that the construction is being carried out.

# 7 **Preliminary objection**

8 When the matter came up for mention on 20th of May, 2025, the Defendants raised a preliminary objection to the effect that- "the suit was filed before a wrong court which has no power to entertain, let alone hear and pass judgment in the said case, as the case falls under the ambits of the Public Procurement and Disposal of Public Assets Act, Cap 205."

# 9 **Legal representation**

10 Counsel Denis Awori holding brief for Counsel Wamaserwa Michael represented the 2nd and 3rd Defendants and the Plaintiff was represented by Counsel Disan Bwayo.

## 11 **Submissions**

- 12 *The 2nd and 3rd Defendants' submission* - 13 Counsel for the 2nd and 3rd Defendants submitted that a procurement complaint can only be entertained in the High Court as an appeal on matters of law from the decision of the Tribunal. He argued that procurement breaches of any nature are handled through a process of administrative review as provided by the law. - 14 Counsel argued that abandoning the administrative review process provided by law to handle procurement complaints and choosing to prematurely file a suit against the defendants is a total abuse of court process that should be condoned. He contended that the entire suit is barred in law to the extent that it does not constitute an appeal to be entertained by this court as it faults the provision of section 118 of the PPDA - 15 Counsel cited sections 118(3), 106, and 115 and the case of *Public Procurement and Disposal of Public Assets Authority V. Peace Gloria Civil Appeal No. 06 of 2016* to support his submissions.

- 16 *The Plaintiff's submission* - 17 Counsel for the Plaintiff submitted that jurisdiction being so central to the authority of the court to undertake proceedings in a case before it, must be raised at the earliest opportunity so that the court does not engage in a futile exercise, wasting court's time and the meager resources of the state. - 18 Counsel submitted that any issue regarding jurisdiction of the court ought to be considered first so that in the event of the court coming to the conclusion that it has no jurisdiction, the exercise of going into the merits or demerits of the suit would be unnecessary. - 19 He referred to *Order 9 rule 3(1) of the Civil Procedure Rules* to submit that the 2nd and 3rd Defendants, instead of filing a written statement of defence as they did, they should have instead filed a Notice of Intention to Defend the proceedings and thereafter, Chamber Summons supported by affidavit, within 15 days of receipt of summons to file defence, seeking a declaration that in the circumstances of the case, the court had no jurisdiction over the Defendants, in respect of the subject matter of the claim, or the relief, or remedy sought in the action. - 20 Counsel argued that failure to follow O.9 rule 3 (1) is found in Order 9 rule 6 of the Civil Procedure Rules. He cited the case of *Owners of Motor Vessel Lilian "S" V. Caltex Oil Kenya Limited [1989] KLR 1,* where it was held that- "Jurisdiction is everything without it; a court has no power to make one more step where a court has no jurisdiction, there would be no basis for continuation of proceedings pending other evidence. A court of law downs its tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction." - 21 Counsel further submitted that the enactment of Public Procurement and Disposal of Public Assets Act as a whole is that

it is more or less a self –contained code which recognizes procurement rights, obligations and disputes arising therefrom which creates rights and mechanism for enforcement of performance.

- 22 He submitted that creating this mechanism for resolving procurement related disputes through Internal administrative review processes, conciliation or mediation and appeals thereafter to the PDDA Tribunal and ultimately the courts, either expressly or impliedly barred the High Courts of Uganda from exercising their constitutional mandate and authority, with wide and absolute original and unlimited jurisdiction to entertain and try all suits of whatever nature, civil, criminal, commercial, industrial, family and land etc. - 23 Counsel argued that it is now recognized rule in the interpretation of Statutes by various courts of law that a curtailment of the powers of a court of law, in the absence of an express provision, or clear implications to the contrary, is not to be presumed or entertained. - 24 He cited Article 139(1) of the Constitution of the Republic of Uganda, *Kameke Growers Cooperative Society Limited and 7 Others V. North Bukedi Cooperative Union, SCCA No.08 of 1994, Commissioner General, Uganda Revenue Authority V. Meera Investment Limited SCCA No.22 of 2007 and Smith V. East Elloe Rural District Council [1965] AC 736*, where Lord Viscount Simonds stated that- "Anyone barred in the tradition of the law is likely to regard with little sympathy. Legislative provisions for ousting the jurisdiction of court, whether in order that the subject may be deprived altogether of remedy or in order that his grievance may be remitted to some other tribunal." - 25 Following the above authorities, counsel submitted that the right of access to any court can only be taken away by clear

unambiguous words of Parliament. He argued that the High Court of Uganda has taken the view that an Act of Parliament, except the one which amends the Constitution, may not oust the Court's jurisdiction over any matter of a civil nature. He cited Article 2 (1) and (2) of the Constitution.

- 26 Counsel also submitted that section 118 (3) of the Public Procurement and Disposal of Public Assets Act, Cap 205, is attempting to oust, or indeed it has already ousted the jurisdiction of the High Court of Uganda - 27 In addition, Counsel submitted that, whereas the primary intention of creating the PPDA proceedings and internal administrative review mechanism and processes for procurement related civil disputes resolution, is to provide a speedy, inexpensive and effective forum for the said disputes, however, it was created as an alternative and concurrent, rather than an exclusive forum, since section 118(3) of the PPDA Act, Cap 205 does not, expressly exclude the original unlimited jurisdiction over all matters, including civil matters, as provided for in section 14 of Judicature Act and Article 2 and 139 (1) of the Constitution of the Republic of Uganda. - 28 The 2nd and 3rd Defendants further filed submissions in rejoinder and they have been considered in this ruling.

## 29 **Determination of court.**

30 It is noted from the court record that this matter came up on 25th of May, 2025 for mention. On the record, the parties had already filed the joint scheduling memorandum, trial bundles and the witness statements. However, since the matter was just coming up for mention, the said documents had not yet been admitted as part of the court record. - 31 Nevertheless, since the Defendants filed their written statements of defence, it is presumed that they admitted to the procedural jurisdiction of this court. - 32 **Order 9 rule 3 (1) of the Civil Procedure Rules SI.71** provides that-

*(1) A defendant who wishes to dispute the jurisdiction of the court in the proceedings by reason of any such irregularity as is mentioned in rule 2 of this order or on any other ground, shall give notice of intention to defend the proceedings, within the time limited for service of a defence, apply to the court for-*

*(g) a declaration that in the circumstances of the case the court has no jurisdiction over the defendant in respect of the subject matter of the claim or the relief or remedy sought in the action; or (h) such other relief as may be appropriate*

- 33 **Order 9 rule 6 of the Civil Procedure Rules** further provides that- *"Except where the defendant makes an application in accordance with sub-rule (1) of this rule, the filing of a defence by a defendant shall, unless the defence is withdrawn by leave of the court under rule 1 of Order XXV of these Rules, be treated as a submission by the defendant to the jurisdiction of the court in the proceedings."* - 34 In **Ozuu Brothers Enterprises V. Ayikoru Milka Civil Revision No.0002 of 2016,** Justice Stephen Mubiru stated that-

*"Order 9 rule 6 of the Civil Procedure Rules therefore relates to challenges to competence (which is a procedural aspect of jurisdiction) rather than subject matter, personal, territorial or temporal jurisdiction (which is substantive jurisdiction). This is because Order 9 rule 2 of the Civil Procedure Rules provides that the filing of a defence by the defendant is not to be treated as a waiver by him or her of any irregularity in the* *summons. Reading the two provisions together ( i.e O.9 r.6 and O.9 r.2), the conclusion is inevitable that filing a defence in circumstances of this nature, where the party should instead have filed a notice of intention to defend the proceedings, is a submission to the procedural rather than the substantive jurisdiction of the court.*

35 He further noted that-

*"A party who files the defence in those circumstances is not precluded from raising the issue of jurisdiction in the defence or as a preliminary point of law... In filing its written statement of defence the applicant submitted to the competence of the court to be properly seized of the matter and the court itself was henceforth the appropriate forum for objecting the substantive jurisdiction to try the case."*

- 36 I agree with the reasoning of my brother judge that failure to follow the procedure under Order 9 rule 3 (1) does not necessarily preclude a party from raising the issue of jurisdiction, and it is the more reason, the law allows points of law to be raised at any stage of the proceedings. Therefore, the 2nd and 3rd Defendants properly raised this preliminary objection. - 37 I will now handle the issue of whether this court has jurisdiction to handle the instant suit or not. - 38 For purposes of clarity, I will discuss the provisions in the Public Procurement and Disposal of Assets Act which are alleged to limit the jurisdiction of this court to hear procurement matters. - 39 Section 106 (1) of the Public Procurement and Disposal of Assets Act, Cap 205 read together with Regulation 4 (1) of the Public Procurement and Disposal of Assets (Administrative Review) Regulations, 2023, provides that-

*A bidder who is aggrieved by a decision of a procuring and disposing entity may make a complaint to the accounting officer of the procuring and disposing entity.*

40 *Section 106(4) further provides that-*

*"The procuring and disposing entity against which a complaint is made shall on request provide the bidder with a report indicating the reasons for the rejection of the bidder and the stage at which the bidder was rejected and the report shall be used only for administrative review process."*

- 41 Section 106(7) of the PPDA Act read together with Regulation (6) (4) of the Rules therein provides that the accounting officer shall take a decision within ten days of receipt of a complaint, which shall indicate the reasons for the decision taken and the corrective measures to be taken if any. - 42 If the bidder is dissatisfied with the decision of the accounting officer may also make a complain to the Authority through the Executive Director as per Regulation 6 (4). - 43 Upon review by the Authority and the bidder is still dissatisfied with the decision under Regulation 9(4), he or she may appeal to the Tribunal. (Also see Section 106(8) of the PPDA Act). - 44 In this case, it is clear that the Plaintiff's participation in the procurement process ended at submission of the bidding documents. It contends that upon submission, it was selected and the next step was to be forwarded to the evaluation committee but the process was halted. - 45 However, to its surprise, it found out later when the 1st Defendant had awarded the contract to M/S Gali Technical Services allegedly without following the PPDA Rules and Regulations. - 46 The Plaintiff further averred that upon discovering these strange and illegal developments, it sought intervention of the Local Government Officials of Butebo district vide an appeal, a

complaint/petition, with a view of having the questionable contract award to M/S Gali Technical Service Ltd re-visited, reviewed and probably an administrative review under taken, but all at no avail. It referred to its letter dated 29th of December, 2021 which is a complaint to the Accounting Officer. The said letter was replied to by the Accounting Officer in his letter dated 30th of December, 2021.

- 47 Therefore, following the guidance in the provisions of the law discussed above, if the Plaintiff was dissatisfied with the decision of the Accounting Officer, he ought to have expressed his dissatisfaction to the Authority for review of the decision of the Accounting Officer or appeal to the Tribunal. - 48 Counsel for the 2nd and 3rd Defendants argued that section 118 of the PPDA Act requires a party aggrieved by a procurement decision or process to lodge an appeal to the High Court, therefore, this suit ought to have been by way of an appeal. - 49 I have had a benefit to read section 118(1) of the PPDA Act which provide that-

"*a party to proceeding before the Tribunal who is aggrieved by the decision of the tribunal may, within thirty days after being notified of the decision of the Tribunal or within such further time as the High Court may allow, lodge a notice of appeal with the registrar of the High Court".*

- 50 From this provision, only a person aggrieved by the decision of the Tribunal may appeal to the High Court, provided that they have first exhausted all prior remedies, beginning with the Accounting Officer, the Authority and proceeding through the Tribunal. - 51 The Plaintiff, however, only explored the first option of complaining to the Accounting Officer leaving out all the other avenues of redress as explained herein. The complainant instead chose to file

this matter directly to the High Court. In my opinion, this was irregular.

- 52 I am aware that Article 139(1) of the Constitution confers unlimited original jurisdiction upon the High Court in all matters, including the present case. However, Parliament did not enact the Public Procurement and Disposal of Public Assets Act in vain. It clearly intended that procurement matters be addressed first through the internal mechanisms established under the PPDA Act and the Regulations thereunder namely; the Accounting Officer, the PPDA Authority and the Tribunal whose members are specialized to handle such matters expeditiously. It is only when a bidder is dissatisfied with the outcomes of these processes that an appeal may be lodged to the High Court, whose decision in procurement matters is final and conclusive. - 53 It is therefore my considered opinion that in determining whether the jurisdiction of the Court should be ousted, the provisions of the Constitution must be read in harmony with all other enabling laws. This approach helps to prevent case backlogs and avoids rendering statutory provisions inoperative, thereby giving effect to the mischief the statute was intended to remedy. - 54 In the circumstance, the preliminary objection is sustained. - 55 The suit is hereby dismissed with costs.

I so order.

**…………………………………**

**LUBEGA FAROUQ**

## **Ag. JUDGE**

*Ruling delivered via the emails of the Advocates of the parties on 09th of July, 2025*