[2025] UGHCLD 121

## **THE REPUBLIC OF UGANDA**

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

## **(LAND DIVISION)**

## **MISCELLANEOUS APPLICATION No. 1108 OF 2025**

## **(ARISING FROM MISC. APPLICATION NO. 540 OF 2025)**

**(ALL ARISING FROM MISC. APPLICATION NO.222 OF 2025)**

- **1. NAMATOVU RAMULA** - **2. NABUNYA JUSTINE KAKANDE** - **3. BIRABWA PROSCOVIA** - **4. NALUBEGA SHIFAH MUSISI :::::::::::::::::::::::: APPELLANTS** - **5. NABUKENYA LEILAH** - **6. NAKAKANDE AIDAH ELIZABETH** - **7. MUYOMBA RATIB**

**T/A NAMBUSSI, MUSISI & PARTNERS**

## **VERSUS**

**MODERN ELECTRONICS LIMITED ::::::::::: RESPONDENT**

## **BEFORE: HON. LADY JUSTICE NALUZZE AISHA BATALA**

# **RULING**

*Introduction*

1 $$\frac{1}{\sqrt{2}}$$

- 1. Namatovu Ramula, Nabunya Justine Kakande, Birabwa Proscovia, Nalubega Shifa Musisi, Nabukenya Leilah, Nakakande Aida Elizabeth and Muyomba Ratib trading as Nambuusi, Musisi & Partners herein after referred to as the appellants brought this appeal against Modern Eletronics Limited hereinafter referred to as the respondent for orders that: - i) The orders of the Assistant Registrar made on the 2nd day of May 2025 in Miscellaneous Application No. 540 of 2025 be set aside. - ii) Miscellaneous application No 540 of 2025 be dismissed with costs in the said application and this appeal.

#### *Appellants' evidence;*

- 2. The application is supported by an affidavit in support of the application deponed by Nabukenya Leilah which briefly states as follows; - i) That the appellants are the registered proprietors of the suit land comprised in LR V 3532 Plot 79A Kampala Road.

- ii) That the learned Assistant Registrar inferred the subsistence of a lease agreement between the appellants and the respondent, which was contrary to the facts as the appellants have no contract with the respondent. - iii)That the notice of vacating the premises to the respondent did not come as a shock but was anticipated since it had been reduced in writing by the respondent and its previous landlord. - iv) That the respondent clearly stipulated the amount of the loss to the tune of UGX 400,000,000/= and that the holding of court that the respondent will suffer irreparable damage was erroneous. - v) That the respondent did not lead evidence of the alleged investment of UGX 400,000,000/=. - vi) That the respondent does not have any chances of success in Civil Suit No 222 of 2025 because he seeks to enforce a lease and development agreement against the appellants yet we were never party to the agreement. - vii) That the balance of convenience is in favour of the respondents who are the registered proprietors of the suit property.

#### *Respondent's evidence;*

- 3. The application/appeal is respondent to by way of an affidavit in reply deponed by Saleem Hirani the managing director of the respondent and briefly states as follows; - i) That this is an appeal against the learned Assistant Registrar's exercise of discretionary powers and that the appellants have fallen short of the standard required to prove that the learned Assistant Registrar did not exercise the discretion judiciously. - ii) That the basic rule is that the covenants in a lease such as the one related to renovation reimbursement and the terms are enforceable between the present landlord and the tenant on account of privity of estate even though the Registered proprietorship changes. - iii)That the registrar was right in holding that the respondent's business would suffer irreparable damage that cannot be atoned for by way of damages. - iv) That the learned Assistant Registrar was right in holding that the respondent had made out a prima facie case.

- v) That the learned Assistant Registrar was correct in holding that the balance of convenience lay in favour of the respondent because the suit property is static and immovable. - 4. The appellants filed an affidavit in rejoinder which shall be relied on in making this decision.

#### *Representation;*

5. The appellants were represented by Counsel Bogezi Ronald and Saad Seninde for the appellants whereas the respondent was represented by Counsel Munanura Gibson. Both the appellants and respondents filed written submissions which I have relied on in the determination of this ruling.

#### *Duty of the first appellate court;*

6. *Section 76(1)(h) of the Civil Procedure Act* provides; "An appeal shall lie from the following orders, and except as otherwise expressly provided in this Act or by any law for the time being in force from no other orders- (h) Any order under the rules from which an appeal is expressly allowed by the rules"

- 7. *Order 50 rule 8 of the Civil Procedure Rules* provides thereof that any person aggrieved by an order of a Registrar may appeal from the order to the High Court. The appeal shall be by motion on Notice. - 8. The duty of the first appellant court is to re-evaluate/reappraise the evidence on record. See *Fr Narsensio Begumisa & Ors v Eric Tibebaga SCCA No .17 of 2002* - 9. Ground 1 and 2 of the appeal shall be determined concurrently and then ground 3 and 4 of the appeal shall be determined separately.

## *Resolution and determination of the grounds.*

*Ground 1: The learned Assistant Registrar erred in law when he held that if the appellants are not restrained from evicting the respondent from the suit property, the respondent's business will suffer irreparable damage for which no amount of monetary compensation shall sufficiently be atoned.*

*Ground 2: That the learned Assistant Registrar erred in law and fact when he held that the notice of the respondent to vacate the premises within six months of receipt of the notice*

# *was contrary to the lease agreement and it comes as a shock because the respondent's lease term was still running until the 14th day of November 2029 thus arriving at the wrong conclusion.*

- 10. Counsel for the applicants submitted that irreparable damage does not mean that there must not be physical possibility of repairing the injury but means that the injury must be a substantial or material one that cannot be adequately compensated in damages. Counsel relied on Kiyimba Kaggwa v Hajji Abdul Nasser Katende. - 11. Counsel added that paragraph 7(iii) of the lease and development agreement marked annexure A to the affidavit in support of the Miscellaneous Application No. 540 of 2025 provides for compensation for the development costs incurred by the respondent for the lease duration unutilized as against Betty Kyakyo which development costs the respondent has quantified to UgShs 400,000,000/=. - 12. Paragraph 7 (vii) of the lease and development agreement marked annexure A to the affidavit in support of the application

in Miscellaneous Application No. 540 of 2025 provides for termination of the agreement meaning the respondent was alive to the possibility of Betty Kyakyo terminating the agreement at any time prior to the lapse of the lease duration and compensate for the development costs was always a possibility known by the respondent.

- 13. In response Counsel for the respondent submitted that it is a well-established principle of law that the purpose of a temporary injunction is to maintain the status quo and that through judicial precedent, certain key conditions must be met before court can grant a temporary injunction. - 14. Counsel added that the grant of temporary injunction is an exercise of judicial discretion and the purpose of granting it is to preserve the status quo until the question to be investigated is investigated. Counsel relied on Kiyimba Kaggwa v Hajji Abdu Nasser Katende (Supra). - 15. Counsel also submitted that the appellant cannot argue that they were not party to the lease agreement because the basic rule is that the covenants in a lease such as the one related to renovation reimbursement and the terms are

enforceable between the present landlord and the tenant on account of privity of estate even though the Registered proprietorship changes.

16. To demonstrate irreparable damages that are incapable of being compensated in damages, Counsel for the respondent submitted that the respondent has operated a retail store dealing in assorted electronics hardware and has been in business ever since 1998 and has operated at the business premises for over 5 years and such good will cannot be atoned for in monetary terms.

#### *Analysis by court;*

*17.* The conditions for the grant of a temporary injunction are now settled; first the applicant must show a prima facie case with a probability of success. Secondly, and injunction will not normally be granted unless the applicant might otherwise suffer irreparable damage, which would not adequately be compensated by an award of damages. Thirdly if the court is in doubt, it will decide an application on the balance of convenience. *(E. A Industries v Trufoods, [1972] EA 420)*

- *18.* One of the considerations for the grant of a temporary injunction is whether the applicant will suffer irreparable damage. - *19.* In *Giella v Cassman Brown & Co [1973] EA 358* it was held that by irreparable injury it does not mean that there must not be physical possibility of repairing the injury, but it means that the injury or damage must be substantial or material that is; one that cannot be adequately atoned for in damages. *(See Misaki Kaviigi v Musiime James Court of Appeal Civil Application No 147 of 2024).* - *20.* In the instant case, it is not in dispute that the applicants are the registered proprietors of the suit-land. It is also not in dispute that the respondent is not claiming an interest in the suit land but rather an order for re-instatement of the tenancy and compensatory orders in the alternative. - *21.* It is also quite clear that the respondent does not intend to challenge and/or oust the proprietary interests of the appellants in any way but only seeks to enforce contractual obligations pursuant to a contractual tenancy between the respondent and a one Betty Kyakyo (the appellants' predecessor in title).

- *22.* I have also taken cognizance of the fact that the respondent seeks remedies under the Landlord and Tenant Act 2022 and therefore claims from the position of a tenant as against the landlord. - *23.* I have had the opportunity to peruse annexure A to the application (the lease and development agreement) and it is evident that under paragraph 7 (iii) an early termination was envisaged. It is therefore not true that any form of early termination of the tenancy was not anticipated and therefore came as a shock to the respondent. - *24.* I find that the respondent could not make a proper case that she would suffer irreparable damage incapable of being atoned in monetary terms even after the sum of UGX 400,000,000/= as compensation was claimed in the alternative in the plaint by the respondent. - *25.* I cannot find an injury that is incapable of being atoned in monetary terms that would happen to the respondent. This in

my view is a classic case of the likely injury is capable of being compensated in monetary terms.

*26.* In the premises grounds 1 and 2 of the appeal succeed.

# *Ground 3: That the learned Assistant Registrar erred in law and fact when he did not/failed to pronounce himself on the respondent having a prima facie case with a possibility of success*

27. Counsel for the applicants submitted that with regard to the 1st principle whether there has been a prima facie case with a probability of success, the court must be satisfied that the claim is not frivolous or vexatious and that there is a serious question to be tried. Counsel relied on *American Cynamide v*

### *Ethicon [1975] ALL ER 504)*.

28. That the said lease and development agreement cannot be enforced against the appellants and as such the claims of the respondent are frivolous. That the respondent has a remedy against Betty Kyakyo and should proceed to pursue the claim against Betty Kyakyo and that the instant suit is frivolous for not including Betty Kyakyo as a party.

- 29. In reply counsel for the respondent maintained that the basic rule is that the covenants in a lease such as the one related to renovation reimbursement and the terms are enforceable between the present landlord and the tenant on account of privity of estate even though the Registered proprietorship changes. - 30. That the reliefs claimed by the respondent in Civil Suit No.222 of 2025 are both statutory and equitable wherein the respondent seeks an order for reinstatement of the tenancy by Section 41 of the Landlord and Tenant Act 2022. - 31. Counsel further submitted that the likelihood of success is the most important consideration when determining an application for the grant of a temporary injunction. Counsel relied on *Gashumba Maniraguha v Sam Nkudiye Civil Application No. 24 of 2015.* - 32. That at this stage the respondent is merely required to demonstrate a prima facie case with a probability of a success but not success. That the respondent is only required to show that there is a serious issue to be tried. Counsel relied on

## *Robert Kavuma v Hotel International Supreme Court Civil Appeal No. 8 of 1990.*

33. Counsel concluded by submitting that the respondent has demonstrated that she has goodwill and, on that basis, and in reference to Section 41 of the Landlord and Tenant Act 2022 is entitled to have the termination of the tenancy challenged and tenancy reinstated.

#### *Analysis by court;*

- 34. The Supreme Court in the case of *Gashumba Maniraguha v Sam Nkudiye Civil Application No.24 of 2015* held that the likely hood of success is the most important consideration in such applications. As to whether the suit establishes a prima facie case with the probability of success, the applicant has to satisfy court that there is merit in the case, it does not mean that one should succeed. - 35. It simply means that there is a triable issue or a serious question to be tried, that is, an issue which raises as prima facie case for adjudication. *(See; Kiyimba Kaggwa supra)*

- 36. This court is alive to the notion that at this stage court should do as much as possible to avoid delving into the merits of the main suit so as not to settle the case in the main suit at this stage. - 37. I have perused the ruling of the learned Assistant Registrar in Miscellaneous Application No. 540 of 2025 and it appears the Registrar did not address the issue pertaining to a prima facie case with the probability of success. It is failure on the part of the court where it fails to consider and resolve matters in contention. *(See Joy Tumushabe and Anor v Anglo African Ltd and Anor [1998] UGSC 5)* - 38. I will therefore proceed to determine whether the applicant (now respondent) demonstrated a prima facie case with the probability of success. - 39. The respondent in the main suit seeks to enforce a lease and development Agreement against the appellants for among other orders to reinstate the tenancy and other compensatory orders. The respondent entered into the agreement with a one Betty Kyakyo who has since then sold the property to the appellants. The respondent further avers that the appellants'

actions constitute a breach of the lease and development agreement.

- 40. I find that the main suit where the respondent is the plaintiff raises triable issues to be investigated by this court. I therefore find that the respondent demonstrated a prima facie case with the probability of success. - 41. In the premises ground 3 succeeds, I find that the respondent demonstrated a prima facie case with the probability of success.

# *Ground 4: That the learned Assistant Registrar erred in law and fact when he granted the balance of convenience in favour of the respondents.*

42. Counsel for the applicants submitted that if the court is in doubt on any of the principles of a prima facie case and suffering irreparable damage, it will decide the application on the balance of convenience. That the term balance of convenience literally means that if the risk of doing an injustice is going to make the applicants suffer then probably the balance of convenience is favourable to him or her and the court would

most likely be inclined to grant him/her the application for a temporary injunction.

- 43. The respondent is neither the registered proprietor nor a tenant to the appellants and has no interest in the suit property before this court. - 44. Counsel emphasized that it shall be greater unfairness and injustice to bar the appellants with registered interest in the suit property and with an obligation to make monthly refunds on a bank loan from utilizing the funds secured from the bank to develop the suit property in protection of an alleged tenancy by the respondent. - 45. In response Counsel for the respondent was in agreement that in case court is in doubt on any of the first two conditions, it will decide the application on the balance of convenience. - 46. Counsel added that the balance of convenience is in favour of the respondent or has invested heavily in the said business and that the respondent stands prejudiced if evicted from the suit property.

*Analysis by court;*

- *47.* Balance of convenience lies more on the one who will suffer more if the appellants are not restrained in the activities complained of in the suit. In arriving at the proper decision whether the balance of convenience favours a party, court must weigh the loss or risk at exposure for the applicant in the event the order is denied and the damage which could be suffered if it is not granted. *(See Jayndrakumar Devechand Devani v Haridas Vallabhdas Bhadresa & Anor Civil Appeal No. 21 of 1971 (Court of Appeal of East Africa)* - *48.* The learned Assistant Registrar in Miscellaneous Application No. 540 of 2025 did not address the issue pertaining to the balance of convenience and if at all he had it in mind, he found that it lay in favour of the respondent. - *49.* In this case the respondent does not contest the interest of the appellants and their position as registered proprietors of the suit land. The appellants are the undisputed registered proprietors of the suit-land. The appellants purchased the property using a loan to the tune of USD 3,000,000 from Exim Bank (U) Ltd to develop the property and currently servicing the loan. I do not see how the suit will be rendered nugatory as the

Learned Assistant Registrar observed in his ruling given that the respondent is not claiming a legal interest in the property.

- *50.* I believe the balance of convenience favors the appellants who are the undisputed legal owners of the suit land and at liberty to use their property as they deem fit provided, they do not infringe on any person's rights - *51.* In the premises, ground 4 of the appeal succeeds. - *52.* I find that the respondent's application in miscellaneous application No.540 of 2025 fell short of what is required for the grant of a temporary injunction, the Learned Assistant Registrar did not exercise his discretion judiciously as required by the law. - *53.* In consideration of the foregoing, the appeal succeeds with the following orders: - i) The ruling and orders of the Assistant Registrar in Miscellaneous Application No. 540 of 2025 granting a temporary injunction to the respondent against the appellants are hereby set aside. - ii) Miscellaneous Application No. 540 of 2025 is hereby dismissed.

iii)Costs of this appeal and Miscellaneous Application 540 of 2025 shall follow the outcome of the main suit.

## **I SO ORDER**

## **NALUZZE AISHA BATALA**

**Ag. JUDGE.**

#### **10 th/07/2025**

#### **Delivered Electronically via ECCMIS this 10 th day of**

**July 2025.**