[2025] UGCommC 52

## 5 **THE REPUBLIC OF UGANDA**

## **IN THE HIGH COURT OF UGANDA AT KAMPALA**

#### **(COMMERCIAL DIVISION)**

# **CIVIL APPEAL NO. 0040 OF 2022 (ARISING FROM MISC. APPLICATION NO. 1096 OF 2019)** 10 **(ARISING FROM EMA NO. 1714 OF 2014) (ALL ARISING FROM CIVIL SUIT NO. 550 OF 2014)**

#### **1. MUGENYI CHRISTOPHER**

**2. TUSHEMERERWE FELIX :::::::::::::::::::::::::::::::::::::: APPELLANTS** 15 **VERSUS NASUNA JANE :::::::::::::::::::::::::::::::::::: RESPONDENT**

#### **BEFORE: HON. LADY JUSTICE PATIENCE T. E. RUBAGUMYA**

## 20 **JUDGMENT**

Introduction

The Appellants, Mugenyi Christopher and Tushemererwe Felix, aggrieved by the decision and orders of **His Worship Matovu Hood, Magistrate Grade 1** in *Misc. Application No. 1096 of 2019* at Makindye Chief 25 Magistrates' Court at Makindye, delivered on 16th December, 2021, filed this appeal on grounds that: -

1 The Learned trial Magistrate erred in law and fact when he set aside a judicial sale that had been made absolute.

2 The Learned trial Magistrate erred in law and fact when he held that there was no judgment and decree on which to hold the Court sale thereby setting it aside.

5 The Appellants seek orders of this Court that the ruling and orders of the Learned trial Magistrate in *Misc. Application No. 1096 of 2019* be set aside and the appeal be allowed with costs to the Appellants in both this Court and the trial Court.

## 10 Background to the Appeal

The brief background to this appeal is that on 9th April, 2014, Song Xuessen T/A Hong Chang International Co. Ltd instituted a summary suit vide *Civil Suit No. 550 of 2014*, against Nasuna Jane, the Respondent herein, for recovery of UGX 6,200,000/= (Uganda Shillings Six Million Two

15 Hundred Thousand Only), being a debt owed to it by the Respondent, interest on the above amount and costs of the suit. The facts that constituted the claim were that; on 10th January, 2014, the Respondent secured a loan of UGX 4,000,000/= (Uganda Shillings Four Million Only), from the Plaintiff payable with interest within three months. The 20 Respondent failed to pay the outstanding loan which at the time of instituting the above suit was UGX 6,200,000/= inclusive of the accrued interest.

On 11th June, 2014, **His Worship Ereemye Jumire James Mawanda**, the

25 **Principal Magistrate Grade 1** (as he then was), entered judgment against the Respondent under **Order 36 rule 3 of the Civil Procedure Rules**. On the same day, 11th June, 2014, the Plaintiff's bill of costs was taxed and allowed, and later, the matter was forwarded to the Execution Division. The suit property at Bwebajja Zone LC 1 Kitende Parish Wakiso District 30 used as security was advertised and sold to the Appellants.

On 21st August, 2015 vide *Misc. Application No. 574 of 2015*, the Respondent sought orders of the lower Court to set aside the ex parte

5 judgment and decree, stay of execution and costs of the application on grounds that; she was unaware of the proceedings as she was not served with the Court summons and hence denied an opportunity to be heard. That she learnt of the matter on the day of eviction. On 4th February, 2016,

**His Worship Kule Moses Lubangula, Magistrate Grade 1**, granted the 10 Respondent leave to appear and defend *Civil Suit No. 550 of 2014*. On 25th August, 2016, the Respondent filed her written statement of defence.

On 13th December, 2016 when the matter came up for mention, Counsel for the Plaintiff raised a preliminary objection that the decree had already 15 been executed by the High Court, Execution Division. On 21st December, 2016, in his ruling, the trial Magistrate upheld the Plaintiff's preliminary objection and set aside the ruling of 4th February, 2016 and reinstated the ex parte judgment of 11th June, 2014 reasoning that at the time of setting aside the ex parte judgment, the execution had already taken place.

Aggrieved by the above ruling, the Respondent vide *Civil Revision No. 37 of 2017*, sought a revision order of the above ruling. On 12th April, 2019, **Hon. Lady Justice H. Wolayo** nullified the ruling for having been made with material irregularity and made orders that the ruling dated 4th 25 February, 2016 setting aside the ex parte judgment still stands, and the Respondent was then advised to apply for third-party notices to issue against the parties who acquired interest in the property sold under the ex parte judgment. The file was sent back for trial.

30 On 20th September, 2019, the Respondent sought the third-party notices to be issued against Tushemererwe Felix and Mugenyi Christopher which were granted on 11th March, 2021. Pursuant to *Misc. Application No. 1096 of 2019*, the Respondent herein also sought orders of the trial Court that, the sale of land and developments situated at Bwebajja Zone LC 1

- 5 Kitende Parish Wakiso District in execution of the decree in *Civil Suit No. 550 of 2014* be set aside and the property be handed back to the Respondent. **His Worship Matovu Hood Magistrate Grade 1** (as he then was), on 6th December, 2021 granted the application. - 10 Aggrieved by the above decision, the 1st Appellant filed *Misc. Cause No. 53 of 2022* in this Court seeking leave to file an application for leave to appeal against the trial Magistrate's ruling in *Misc. Application No. 1096 of 2019* out of time and leave to file the appeal. The same was granted on 25th August, 2022, hence this appeal. - 15

# Representation

Learned Counsel Obiro Francis of **M/s R. Nsubuga & Co. Advocates** represented the Appellants while Learned Counsel Bbaale Sadat of **M/s Bbaale & Partners Advocates & Legal Consultants** represented the 20 Respondent.

Written submissions were filed by the parties as directed by this Court and the same have been taken into consideration.

Ground 1: The Learned trial Magistrate erred in law and fact when he set aside a judicial sale that had been made absolute.

# Appellants' submissions

30 Counsel submitted that generally, a purchaser who buys pursuant to execution of a decree acquires a good title as premised on **Section 49 of the Civil Procedure Act, Cap. 282** which stipulates that subject to any law relating to the registration of titles to land, where immovable property is sold in execution of a decree, the sale shall become absolute on payment 35 of the full purchase price to the Court, or to the officer appointed by the

5 Court to conduct the sale and that this was held in the case of *Ruzindana Senyonga Vs Mash Investments Ltd CACA No. 93 of 2014.*

Counsel also submitted that the trial Magistrate erred when he disregarded all the evidence regarding the sale of the said property by a registered Court Bailiff selling the said property to the 2nd Appellant, the 10 evidence of deposit of the said consideration on the accounts of the Registrar High Court, and the subsequent evidence, of purchase of the said property to the 1st Appellant which evidence was all on the Court record.

Counsel contended that the case of *Lawrence Muwanga Vs Stephen*

- 15 *Kyeyune (Legal Representative of Christine Kisamba, deceased) SCCA No. 12 of 2001,* relied upon by the trial Magistrate is distinguishable from the instant facts as the said case was about objector proceedings and the Respondents therein had objected to the sale order by Court before its conclusion. - 20 Counsel contended that there is no evidence to show that proceedings were ever taken to challenge the sale before it was made absolute thus making the order setting aside the said sale erroneous.

In his conclusion, Counsel submitted that the only available remedy to the Respondent was to follow the appropriate procedure to challenge execution

25 by order of Court which was to be through objector proceedings to object the attachment of the immovable property or filing of a fresh suit on the grounds mentioned in **Section 50(2) of the Civil Procedure Act**, none of which was ever done.

Respondent's submissions

- 5 In response, Counsel for the Respondent relied on **Order 22 rules 51(2) and 62 of the Civil Procedure Rules SI 71-1** which are to the effect that; the sale of immovable property, unless directed otherwise by the Court, is supposed to be conducted by way of a public auction and that the judgment debtor must be notified of the purported sale. However, that the - 10 Respondent in this case was never notified of any proceedings in Court. That she was never served with the summons in *Civil Suit No. 550 of 2014* as well as the execution proceedings and order for the sale of her property.

Counsel also pointed to the irregularities that were made during the sale 15 of the Respondent's property including; that the Respondent was never served with a warrant of attachment and sale and the order of sale of the property yet **Order 22 rule 51(2) of the Civil Procedure Rules**, requires that where there is an order of attachment of immovable property, a copy of the order shall be served by either affixing it on a conspicuous part of

20 the property or serving it on the judgment debtor or if the Court directs, then on some conspicuous place of the Court or the conspicuous part of the house where the judgment debtor resides or where he/she carries on business or works.

Counsel further contended that under **Order 22 rules 63 and 64 of the**

- 25 **Civil Procedure Rules** the sale of immovable property can only take place at least 30 days from the date on which the public notice of sale was advertised and if the sale is adjourned as was the case in these execution proceedings, before conducting a sale, a fresh notice had to be run in the newspapers. - 30 That in the instant case, an advert was run in the newspapers in April, 2015, so the 30 days ran up to May, 2015 but the sale was conducted on

5 13th July, 2015 almost two and a half months after the date of the advert. Counsel contended that a new advert ought to have been run before the sale on 13th July, 2015.

In support of the above, Counsel relied on the case of *Kibuuka Nelson & Another Vs Yusuf Zziwa Misc. Application Nos. 72 and 225 of 2008* 10 in which **Hon. Justice Yorokamu Bamwine** (as he then was), indicated that as regards advertisement, the law under **Order 22 rules 63 and 64 of the Civil Procedure Rules** is that; a sale of immovable property can only take place at least 30 days calculated from the date on which the public notice of sale was advertised. If the sale is adjourned for a longer 15 period than a calendar week, afresh public notice ought to be given unless the judgment debtor consents to waive such notice.

Given the above, Counsel submitted that the sale was conducted on an expired warrant. That according to the case of *James Kabateraine Vs Charles Oundo & Another HCCS No. 177 of 1994*, an execution is held 20 to be irregular when any of the requirements of the rules of the Court or parties for the time being have not been complied with, and that when execution has been irregularly executed, the Court is enjoined to make an order of restoration.

In further submission, Counsel contended that the Appellants were aware

25 that what they were buying resulted from a Court process and that they ought to have conducted due diligence on the said process and would have discovered that it arose out of an ex parte judgment and that the procedure was marred with irregularities.

Counsel further contended that in the case of *Kanoonya David Vs* 30 *Kivumbi & Others HCCS No. 616 of 2003*, it was held that an illegality vitiates the transfer of title with the result that the sold property remains - 5 the property of the owner. That in the instant case, the said irregularities were considered by the trial Magistrate when nullifying the judicial sale that had been conducted between the Appellants. That the law regarding illegalities as laid out in the case of *Makula International Ltd Vs His Eminence Cardinal Nsubuga & Another [1982] HCB 11*, is that a Court - 10 of law cannot sanction what is illegal and an illegality once brought to the attention of the Court overrides all questions of pleading.

That, having indicated all the said procedural irregularities to the trial Court, the trial Magistrate rightly set aside the said judicial sale.

Appellants' submissions in rejoinder

- 15 In rejoinder, Counsel for the Appellants contended that the Appellants were not parties to *Civil Suit No. 550 of 2014*. That the proper procedure was to file a separate suit and not an application as was held in the case of *Philemon Wandera, Hoima S. S School and the Board of Governors Hoima Secondary School Vs Yesero Mugenyi & Reuman & Co. Ltd* - 20 *Civil Appeal No. 061 of 2009*.

Counsel reiterated his submissions that the judicial sale was not set aside on account, that the sale was coupled with illegalities or fraud, but that the decree in *Civil Suit No. 550 of 2014* had been set aside.

## Analysis and Determination

25 Duty of this Court

It is trite that as a first appellate Court, I am duty bound to re-appraise the evidence on record and come up with my own decision. (See: *Fr. Narsensio Begumisa & 3 Others Vs Eric Tibebaga SCCA No. 17 of 2002* and *Pandya Vs R [1957] EA 336*).

## 5 As stated in the case of *Fr. Narsensio Begumisa & 3 Others Vs Eric Tibebaga (supra)*:

*"It is a well-settled principle 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* 10 *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."*

I shall therefore proceed to re-evaluate the evidence on record. I have carefully considered the appeal, submissions by both Counsel, the law, 15 authorities cited and the record of appeal.

As to whether the Learned trial Magistrate erred in law and fact when he set aside a judicial sale that had been made absolute; it is the law under **Section 49 of the Civil Procedure Act** that;

*"Subject to any law relating to the registration of titles to land,* 20 *where immovable property is sold in execution of a decree, the sale shall become absolute on the payment of the full purchase price to the Court, or to the officer appointed by the Court to conduct the sale*."

As stated in the case of *Lawrence Muwanga Vs Stephen Kyeyune* 25 *(supra)*, a judicial sale, unlike a private one, is not complete immediately it takes place. It is liable to be set aside on appropriate proceedings. If no such proceedings are instituted or if instituted are unsuccessful, the sale will be made absolute.

However, case law sets out exceptions to the above to the effect that any 30 person whose immovable property has been attached and sold in

5 execution of a decree of the Court may seek to set aside the sale on grounds of involvement of a material irregularity. (See: *Allen Nsubuga Ntananga Vs Uganda Micro Finance Ltd and Others HC Misc. Application No. 426 of 2006*).

In the case of *Kibuuka Nelson and Another Vs Yusuf Zziwa (supra),* the 10 **Hon. Justice Yorokamu Bamwine** (as he then was), stated that:

"*Now assuming that a sale has already taken place, as one side to this dispute appears to suggest, is it a correct position of law that it cannot be set aside? The answer is a resounding No. The position of the law as laid down in a number of authorities,* 15 *including James Kabateraine Vs Charles Oundo and Another HCCS No.177/94 reproduced in [1996] 1 KALR 134 is that no property can be declared to have been validly attached and sold in execution unless, first, the order of attachment has been issued, and secondly, in execution of that order other things prescribed by* 20 *the rules in the relevant statutes have been complied with. For as long as it is still within the power of the Court to declare a sale invalid, for instance, when any of the requirements in the rules of Court or parties for the time being in force have not been complied with, the transaction cannot be said to be 100% safe or at all. Put* 25 *differently, if it is proved that an execution has been irregularly carried out, the Court is empowered to make an order of restoration. A wrong execution is in the eyes of the law a trespass*."

**Hon. Justice Stephen Mubiru** in the case of *Maji Real Estates (U) Limited & Another Vs Aulogo Cooperative Savings and Credit Society* 30 *Limited, Adjumani Misc. Civil Application No. 0028 of 2017[2017] UGHCCD 83 (15 June 2017*), stated that;

5 "*Whereas an absolute sale is one where no application to have the sale set aside is made and where if such an application is made, it has been disallowed (*See: *Bancroft and Another Vs City Council of Nairobi and Another [1971] 1 EA 151 and Sam Kaggwa Vs Beatrice Nakityo [2001] 2 HCB 120), no irregularity* 10 *in the process leading up to the sale should vitiate the sale unless the Applicant proves to the satisfaction of the Court that he or she has sustained substantial injury by reason of such irregularity. This is more so in light of Section 49 of the Civil Procedure Act to the effect that where immovable property is sold in execution of a* 15 *decree, the sale becomes absolute on the payment of the full purchase price to the Court, or to the officer appointed by the Court to conduct the sale.*"

From the above, the law set out in **Section 49 of the Civil Procedure Act**, portrays a general rule that where immovable property is sold in execution

20 of a decree, the sale becomes absolute on the payment of the full purchase price to the Court, or the officer appointed by the Court to conduct the sale.

The case law also sets forth exceptions to the general rule to the effect that the above sale can be set aside if the Court is satisfied that there was an 25 irregularity in the execution.

This appeal as observed above is premised on the fact that Song Xuesen T/a Hong Chan International Co. Ltd was granted an ex parte judgment against the Respondent.

Subsequently, the Respondent sought orders of the lower Court to set 30 aside the ex parte judgment and decree on the ground that she was not aware of the Court process and by the ruling dated 4th February, 2016, the

- 5 orders were granted and the Respondent was directed to file her written statement of defence. However, based on a preliminary objection that the decree had already been executed by the High Court Execution Division, on 21st December, 2016, the said orders, were set aside by the Court. Aggrieved by the ruling, the Respondent through *Civil Revision No. 37 of* - 10 *2017*, sought revision of the same.

In her ruling, **Hon. Lady Justice H. Wolayo** found that the Learned trial Magistrate had acted with material irregularity when he reversed his decision setting aside the ex parte judgment.

The Hon. Lady Justice also observed that;

15 "*The Magistrate acted within the law to set aside the ex parte judgment but because it had been executed by the High Court Division, he could not set aside the execution proceedings on account of jurisdiction issues and yet in theory, the setting aside of an ex parte judgment automatically means the execution* 20 *proceedings had no legal basis*."

## **Hon. Lady Justice H. Wolayo** added that;

"*Although there has been lapse of time since the sale and this Court's decision, the ex parte judgment condemned the Applicant unheard contrary to the common law principle of natural justice* 25 *that a party has a right to be heard. As a result, the Applicant must be given an opportunity to be heard in the suit*."

**Hon. Lady Justice H. Wolayo** also observed that though the application will cause hardship to the third parties, she guided that the third parties who acquired an interest in the property be made parties through third-30 party notices at the instance of the Respondent herein.

5 Following the above orders, the Respondent filed *Misc. Application No. 572 of 2019* for leave to add the Appellants herein to *Civil Suit No. 550 of 2014*, which was granted on 11th March, 2021 by Court.

In his ruling, **His Worship Matovu Hood** vide *Misc. Application No. 1096 of 2019,* considered **Sections 49, 50 and 92 of the Civil**

- 10 **Procedure Act**, case law and the facts of this case, especially the Civil Revision and found that the facts of the application were distinguishable from the law and the cases relied upon by Counsel as the facts in the application were that the ex parte judgment and decree had been set aside and confirmed in *Civil Revision No. 37 of 2017*. He stated that; - 15 "*I opine therefore that S.49, 50 and 92 of the CPA and the decision in Green Pastures Limited are not applicable to the case at hand since the two are of different facts and circumstances and since in the current case there is no such decree and judgment to support the impugned sale.*" - 20 The Learned trial Magistrate's ruling was founded on the findings and decision of **Hon. Lady Justice H. Wolayo** in *Civil Revision No. 37 of 2017* wherein she confirmed the setting aside of the ex parte judgment since it violated the principles of natural justice of the right to be heard.

My understanding of Her Lordship's ruling is that; by holding that in 25 theory, the setting aside of an ex parte judgment automatically meant that execution proceedings had no legal basis and further directed the Respondent to add the Appellants herein through third-party notices and returned the suit for trial, was an indication that the execution proceedings followed the result of the setting aside of the judgment and 30 decree and thereby the rehearing of the case with all the necessary parties.

5 The Appellants did not challenge the said decision arising from the Civil Revision but, the one setting aside the sale, yet the suit was reinstated for the reason that the Respondent was not aware of the Court proceedings against her which violated the principles of natural justice.

In the circumstances, I do not find the Learned trial Magistrate to have 10 erred in law and fact when he set aside the sale. This ground accordingly fails.

Ground 2: The Learned trial Magistrate erred in law and fact when he held that there was no judgment and decree on which to hold the Court sale thereby setting it aside.

15 Having discussed the reasoning of the Learned trial Magistrate in setting aside the sale, I find that this ground has been ably discussed above. This ground therefore fails.

In the circumstances, the appeal is dismissed. Costs of this appeal shall be in the cause.

20 I so order.

Dated, signed and delivered electronically via ECCMIS this **28th** day of **February, 2025**.

Patience T. E. Rubagumya 25 **JUDGE** 28/02/2025