[2023] UGHCLD 67

### THE R. EPUBLIC OF UGANDA

### IN THE HIGH COURT OF UGANDA AT KAMPALA

#### (LAND DrVrSrONl

### CwIL SIIIT NO, 7r3 0F 2021

# 5 NKUBITO ALLAN ::::::::;:::::::::::::::::::::::::COUNTER CLAIMANT

#### VERSUS

### 1. DR. LUBUNDE EDWARI)

# 2. THE COMMISSIONER LAND REGISTRATION::: COUNTER DEFENDANTS

### JUDGMENT: (EXPARTE)

# 10 l^troductlon:

The counter claimant, Allan Nkubita filed this suit seeking cancellation of title for land comprised in Bnslro Block 439 Plot 7847 fonnerly Plot 569 (herein after referred to as the suit land) which he claims were fraudulently registered in the names of Dr. Lubunde Edward, the l"t counter defendant.

15 On 20th June, 2022, M/s Wako.bala & Co, Aduocates wrote to this court notifying it of the counter defendant's failure to file a defcnce to the counter claim.

### Brlef bqckqround:

By way of a brief background, Dr. Lubunde Edward filed Crull Sult No. 0773 of 2027, seeking scveral orders against the defendant/ counter claimant, inter alia, challenging as fraudulent the transaction between the two defendants, relating to Buslro Block 439 plot 7E47lo"merlg plot 559, la]rd at Katabi measuring approximately 0. O14O hectares (0.0346 acres) (suit rand,l; that the 2nd defendant was a trespasser on the suit land; and an order of vacant possession to be issued against him.

25 The main suit abated on 2",t December, 202 l, following the plaintiff/ counter defendant's failure to take out summons for directions within the 28 days as stipulated by the Clutl Procedu"e rules.

A default judgment was subsequently entered by the Rcgistrar on 24th August, 2022 and ltle matter proceeded. exparle, after court had satisfred itself that the counter claim had been duly

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served to the counter defendants, neither of whom however filed a defence. The matter therefore proceeded exparte against both the Dr. Lubunde and Commissioner, Land Registration.

### Gtst of the counter clalm:

ln the counter claim it is averred that on the 1orh day ofJune, 2022, Nkubito Allan entered into an agreement of sale of the suit land with Dr. Lubunde, the 1"r counter defendant and his wife, at a consideration of Ugx aS,OOO,OOO /-leightg fiue million shillings).

That Dr. Lubunde paid a sum of Ugx 25,OOO,OOO/- (twentg-fiue mtllion shillings)cash and also made an exchange of kibanja, valued at Ugx 2O,OOO,OOO/- (tuenlA million shillings/, to make a total of Ugx 45,OOO,OOO/- (forty-fiue million shillings).

- 10 The balance of Ugx 4O,OOO,OOO/= (fortg million shillings)was to be paid within a period of six months from the date of the said sale. However, that Dr. Lubunde had defaulted on the payment of the purchase price within the agreed period which prompted Nkubito to sell the land to one NzLa Patrick, (2"d defendant under the suit) as per agreement dated the 26h day of December, 2020, whereupon he informed Lubunde of this development. Dr. Lubunde however rejected the - 15 offer to refund the money.

That at the time of sa.[e, the title for the suit land was with UNRA which was demarcating off its portion which it had compulsory acquired, awaiting return of the residue to Nkubito only to discover later that Dr. Lubunde had picked the title from UNRA for the residue of the land and fraudulently register himself on the title, with no colour of right whatsoever. He claimed that the registration of the 2.d counter defendant.

At the time, the title for the suit land was in the names of the Nkubito's father, Charles Brian Kwizera who had never transacted with Dr. Lubunde to effect transfer and registration. According to him, the signatures appearing as those of Charles Brian Kwizera on the transfer and mutation forms were forged. An expired passport of 2013 was also used to fraudulently register Lubunde on the title to the suit land and that Lubunde never took possession and occupation ofthe suit

25 land, though he has tried to do so several times.

It is on that basis therefore that the prayer was made by Nkubito to have the title issued in Lubunde's names cancelled as he had no claim whatsoever on the suit land; and general damages and costs to be awarded to Nkubito.

30 The counterclaimant was represcnted by M/s Wako.bo.lo. & Co. Advocqtes.

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#### fssues.'

During the scheduling, three issues had been framed for determination by this court to wit

# 1. Whether the reglstrqtlon of the 7"t counter delendant on tltle to the sult lo'nd u)as fraudulent.

- 5 - ² Whether there ls lauful fusttficatlon to udrrdnt cancellstlon ol tttle for the sult land ln the names of the 7'. counter defendant. - 3- What remedles are quallqble to the partles? - 10 Since the first two issues are inter connected I will deal with both jointly

# Issue No. 7: Whether the reglstratlon of the 7'r cotlnter defendant on the sult lqnd was fraudulent:

### And

# Issue JVo, 2: Whether there ls lawful fustlff.catlo to warrant co,'rcellatlo,r of tttle for the 15 sult lo.nd ln the nq.mes of the 7,t countet defenda t.

### The law:

It is now settled law that once a contract is valid, it automatically creates reciprocal rights and obligations between the parties thereto and when a document containing contractual terms is signed, then in the absence of fraud, or misrepresentation the party signing it is bound by its

20 terms. (S€e.' Wllllann Kasozl tersus DECU Bdnk Ltd Htgh Court Clvll Strlt No.7326 of 2OOO).

According to Sectlon 42(1) (Ind Sectlon 67 of the Contract Act 2O1O, a contract is to be performed either within a reasonable time or at that time provided by the applicable trade usage/ practice to the contract in question.

25 Breach of a contract refers to a situation u,here one party to a contract fails to carry out a term of the said contract. It occurs when a party neglects, refuses or fails to perform any part of its bargain or any term of the contract, written or oral, without a legitimate legal excuse. See.' Ronald Kaslbante us, Shell Ugando. Ltd HCCS No. 542 oJ 2006 [2OO8] ULR 690.

lt follows therefore that when one party to a contract fails to perform his or her obligations or performs them in a way that does not correspond with the agreement, the guilty party is said to 30 be in breach of the contract and the innocent party is entitled to a remedy.

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It is trite law that in all civil matters, the onus rests on the plaintiff who must adduce evidence to prove his or her case on the balance of probabilities if she is to obtain the relief sought. See.' Sectlons 1O7-1O3 ol the Duldence Act, Cdp.43,

In this matter, the counter claimant raises the issue of fraudulent actions attributed to the counter defendants,

Fraud is defined in the case of Eredrick Zdq.bute Vs Orient Bank Ltd & 5 Others SCCA JVo. 4 ol 2OOS to include 'means uhich human ingenuilg can deube and which are resorted to bV one indivtdual to get qdvqnce ouer another by false suggestion or suppression of lruth and includes all surpised trick, cunning dissembling and ang unfair way by which anolher is chealed.

It is well established law that a cause of action in fraud must be specifically pleaded, particulars thereof provided and the claim proved at a higher balance of probabilities. [See: TVU LuktDr:.go vs Samurlrl Mudde Klzza & Another Ctvil Appeal No. 73 of 1996 (SC).) A party faced with pleadings founded in fraud would then know the specific elements that it needs to rebut or disprove in its defence. See.' Fam Inter,.atlon,al Ltd & Another us. Mohqtned llamlrd El-10

#### Frrtth Ctvll Appeal No. 76 ol 7993 (SC). 15

Fraud which must therefore be specifically pleaded and proved includes all acts, omission and concealments which involve a breach of legal or equitable duty, trust or confidence,

The particulars of the fraudulent actions against the l defendant/counter claimant and 2"'l defendant as raised in the main suit were that:

- The ls defendant mortgaging / selling off the suit land to the 2^d defendant uell knouing that the suit land had already been sold off to the plaintiff/ counter defendant; I - 2. The l"t defendant / counterclaimant exeatting a neu.t sale agreement u th the 2"d defendant u.tell knouing that he had executed the same uith the plqintiff/ counler defendant; - 3. Failure bA the plaintw counler defendant to notifu the plaintiff of the sale before enleing into a lransaction uith the 2^d defendant.

# 30 Analusis of the evldence.

Nkubito Allan in this case relied on the evidence of two witnesses, himself as the counter claimant testified as Pur. His brother, Andrew Kananura testified as Pur2,


AaI alleged that Lubunde, the 1sr counter defendant had committed an act of fraud when he registered himself on the title for the suit land, yet he had jointly with his wife Lubunde Esther purchased the land, as per PExh 2 and PExh 6 in the counter claimant's trial bundle.

It was Lubunde's contention in the main suit however that he was the lawful owner of the suit lar,d.. In paragraph 4 /h) ofthe plaint it was alleged that unknown to him on 26th December, 2O20 without his consent and knowledge or that of his wife, Nkubito had mortgaged the suit land to Nziza Patrick in form ofa land sale transaction, as security for a loan worth Ugx SO,OOO,OOO/--, which he had failed to pay; and started laying baseless claims.

lt paragraph 4 (i)t}r'al in June, 2021 without his consent and approval or that of his wife, Nziza had illegally entered the suit land; placed building materials thereon, and started setting up illegal structures. 10

That when confronted the I'r defendant had admitted that he had indeed mortgaged the suit land to Nziza, the 2"(l defendant, thus depriving him of his land and that such actions and conduct had subjected him to mental anguish and distress, entitling him to damages.

He therefore sought a declaration that he was the lawful owner of the suit landi that the sale transaction between the defendants was illegal; an order vacant possession against them: general and punitive damages, among other orders, 15

The 2"0 defendant, Nziza Patrick however in his reply claimed to be a bona fide purchase. He did not file a counter claim but in his defence under the main suit he denied the claims that the transaction between them had been fraudulent.

Nkubito in his defence to the suit claimed however that he had sold the suit land to NzDa who was freely developing the land since there was no claim against him.

The issue of fraud as raised can be categorized as follows:

# d !{!!e!hg! er\_4ot lhe\_Ssl9lgreeDglrLbetween Nk]4blto and Lubunde was yslld;

- It is not in issue that Nkubito had derived his interest in the disputed land from PExh I, under a gift deed by his father Kwizera Charles Brian, dated 271r, February, 2017, for land measuring, 55fi x 45fi. x 55fi x50fi,located at the High way, Abayita Ababiri. The said kibanja was originally part of plot 569, Block 439 and, the transaction was endorsed by Kitubulu LC l, Kabale subparish on the same date the transaction was made, - Pp2 Andrew Kananura gave his testimony as holder of powers of Attorney (PExhL2) granted to him by his father on 18th May, 2016 by Charles Kwizera in respect of the suit land. The 30

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instrument gave him custody of the original title. His evidence corroborated that o/ ProI, his brother.

His role under the instrument ofpower had been to undertake negotiations comprised in Buslro, Block 439, plot 569 with UNRA and pursue compensation for the part of the land acquired during the construction of the Entebbe-Express High way.

He claimed that Kwizera however only signed transfer forms in favour of UNRA but not for Lubunde and thus any transaction purportedly involving Kwizera and Lubunde was fraudulent, a claim which Lubunde however never made any response to.

The witness also confirmed that Nkubito had been given the residue ofthe land after UNRA had demarcated off its portion. That he was surprised therefore that when he went to pick the title from UNRA he found that Lubunde had already picked it. He claimed not to have known how Lubunde had manipulated the system and removed the title from UNRA and got himself registered onto the title. His conclusion therefore was that UNRA had connived with him and the office of the 2",r counter defendant to facilitate and effect the illegal transfer. 10

It is also crucial to note that by virtue of clause (d) of his deed of attorney Put2 had been granted absolute powers to institute legal proceedings against trespassers on that land; and against any failure to pay consideration in relation to the land. 15

The donor also declared that all acts matters executed by his attorney if done under his names and in relation to the land would be deemed valid and would be ratified by him as the donnee.

Attached onto the main plaint is the sale agreement dated 6th February, 2021, the validity of which Nkubito however refuted. lt was the same document attached as PErh 6 to the counter claim, alleged to have been signed on each of the five pages by both parties. 20

What Nkubito did not refute was the handwritten Luganda agreement, dated 10rh June, 2020 between him and Lubunde showing a sketch of 41fi x 52fi x 42fi x 52 fi which appeared to be slightly smatler than the residue that Nkubito originally claimed as his gift.

Unlike the agreement filed by Nkubito, the one by Lubunde had attachments of acknowledgments by Nkubito, of the various amounts received by him from Lubunde defendant on various dates, between 3l"t August, 2020 and 2"d November, 2020, as part payments of the tota.[ consideration.

Nkubito did not appear to deny the signature appearing as his on those separate acknowledgments. As at that date of 2"d November, 2020, it is clear therefore that a sum of Ugx 30

U"!,"t. 16,000,000/= was yet to be paid by the counter defendant to settle the entire claim, not Ugx 45,OOO,OOO/= as alleged in his pleadings.

Neither side denied the fact that Lubunde on loth June, 2O2O had sold the land to Lubunde and his wife Lubunde Esther, at a sum of Ugx 85,OOO,OOO/= nor the claim that the consideration was never paid in full.

It is not in issue that a sum of Ugx 25,OOO,OOO/=, had been paid to Nkubito in cash. Lubunde and his wife also agreed by way ofan exchange in part, to sell their land at Mpala Bubuli, va.lued at Ugx 2O,OOO,OOOI=, 11'rr.r" leaving a tota.l sum of Ugx 45,OOO,OOOIas the balance, which was reflected in the agreements presented by either side. It comes a bit of a surprise therefore that the title that came out had excluded his wife's names.

In another agreement PExh 6, it was in Lubunde's pleadings that on 6th February, 2021, the same parties had subsequently entered into another transaction. In clauses 1. O and 2,l thereof however, it is stated that prior to the execution of the agreement, out of a total purchase sum of Ugx AS,OOO,OOO/=, Ugx 69,500,000/=, bad been paid to Nkubito as consideration for the suit land, leaving an unpaid balance of Ugx 7,5OO,OOO/=,

The two parties had agreed as per that agreement that this amount would be paid in installments. Nkubito however maintained that the only agreement that he had made with Lubunde was that of 10!h June, 2O2O. He therefore denied the signatures appearing as his on the agreement dated 6rh February, 202 1.

- It was his counsel's submission that there was no way Nkubito could have sold the suit land to Lubunde on 6th February, 2021 when he had already sold the same land to Nziza Patrick; and no way that Lubunde would have been registered on title to the suit land when he had paid only Ugx 4O,OOO,OOO/- (forty million shillings) out of the agreed Ugx 85,OOO,OOO/= (etghtg-fioe mllllon shllllngs). 20 - That the transfer and registration of Lubunde on the title to the suit land had been premised on payment and completion of the full purchase price, which he never paid, concluding therefore that this was an act of fraud by Lubunde. 25

Court noted the discrepancies in amounts alleged to have been made in settlement of the claim between the two parties. This created some serious doubt about the outstanding sum as averred

in this counter claim which discrepancies could probably have been explained by Lubunde. Lubunde however failed to turn up in court. 30


What comes out clearly is that the total outstanding amount was never paid to Nkubito as consideration before Lubunde became registered owner of the land. He did not therefore fulfill the terms and conditions of the original contract.

PExh 3, is another agreement entered on 26th December, 2020 which proves to court that upon failure to settle the outstanding amount, the same kibanja was sold by Nkubito at a sum of Ugx SO,OOO,OOO/= to one Nziiza Patrick, which amount was paid in full. Nziiza was already in possession thereof and implies that the subsequent transaction between Lubunde and Nkubito could not have been valid.

Furthermore, Nziza had paid a sum of Ugx 25,OOO,OOO1= So,,n title for the land. Nziiza under that arrangement was given a go ahead to effect transfer in his names as soon as UNRA which had the title was done with the subdivision of the land. 10

At the material time of these transactions, the certificate of title was still under the names of Kwizera. PExh 7 qnd PExh 8, the transfer and mutation forms reveal that on 141r, April,2021 they had been signed by Kwizera as the registered owner. The circumstances under which Lubunde however seized the title and had part of the land transferred into his names were not properly explained.

The authenticity of the trarsfer and mutation forms signed by Kwizera, the registered proprietor remained doubtful also given the fact that Pu2 was the holder of powers of attorney and there was nothing on record to show that such powers had been withdrawn by the donnee at the time of entering any of the said transactions.

The presumption that Kwizera had been out of the country at the time of selling the land was never rebutted by Lubunde. That also lends credence to the claim therefore that Kwizera never transacted with Lubunde and that the signatures appearing on the said forms as his had therefore been doctored. Nkubito is however also faulted for disposing of the land without involving Purz as attorney for the registered proprietor.

## Requlrement for consent:

The principles governing land transactions were enshrined in the case of Joh^ Kcrtlrrl,ko.we os Wllllann Xatulremu F974 HCB I87 where it was held that in the land system based on registration there aIe basically two interests, the registered estate and other registerable interests.

Registered interests are known as rights in rem and bind the whole world. The other rights are rights in persona; such often arise from contracts for sale of land before transfer. lt is only the

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genuine purchaser who acquires an equitable interest in the nature of a right in persona, enforceable only as against the vendor.

The concept of prior consent of the owner/occupant of land before any transactions is made obtained proper reinforcement and proper codification upon the enactment of the 1995

5 Constltutlon o'nd the Land Act, Cdp.227, to the extent that a holder of a kibanja may assign, sublet, pledge, create third party rights, subdivide and undertake any other lawful transaction in respect of the occupancy. (sectlon 34(1) of the Land Act, Cap, 227.).

By virtue of s€ctlon 34(9) thereof, no transaction to which that section applies is considered valid and effective to pass any interest in land, if undertaken without consent. Sectlon 35{I, and (2) ts also clear that the first option to assign or sell the kibanja is given to the owner of the land.

In a similar manner, the owner of land who wishes to sell the reversionar1r interest in land is also required to give the first option of buying that interest to the occupant. Scctlon 36 thus also entitles both holders of the interest to mutually agree on any subdivision, and whether or not each should have exclusive ownership or hold land as joint proprietors.

In this instance, a gift made by the registered owner of the land created two separate or adverse interests over that land. Nkubito before the sale no doubt held an equitable interest over the land registered in his father's names. When subdivisions were made, UNRA had curved off its interests, with the residue as plot I847.

- It is not a matter in dispute that Nkubito was fully aware that UNRA had been authorized by his father to take off a portion of land originally comprised in Euslro, Block 439, plot 569 acquired for the Entebbe Express Highway land, leaving the residue to him. He was under obligation to secure the consent of Kwizera, the land lord before entering into any of the transactions relating to the krbonja for as long as it remained a part of titled land. ?o - Execution of the impugned sale agreement in a manner not envisaged by the power of attorney and by a person not authorized under the said instrument was considered to be void. {Rel P"ogresslve Group of Schook Ltd and 2 others vs Eo.rclr:gs Bo,nk ol Uganda Ltd t/q ABSA Balrk U Ltd and Anor Clutl Appeal No. 349 oJ 2O2O). If an act is void, then it is a nullity and every proceeding which is founded on it is also incurably bad. (Fredrick J. K Zaabue (sz.ryr.a)), 25

#### Inconslstencles and lrregrulqrltles Ln the areq. meosurem,errts: 30

This court observed that the sale agreement PExh 6 for the land comprised in Buslro, Block 439, plot 569 refers to an area of O.49 hectares, a lot more than what was initially gifted to the

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counter claimant and also far exceeded what was reflected in the title for plot ,847, (PExh 5)or the area schedule as the actual size of plot 569.

Even more absurd is the fact that the title for plot 7E47 reflects the same area of 0. O49 hectares as in plot 569, the mother plot out of which it had been created.

5 From the area schedule presented upon request by this court, plot 7846 measuring O. O47 hectares remained in the names of Charles Kwizera while onlv 0. OO2 hectares remained as the residue.

The acreage in the sale agreement PExh6 did not therefore tatly with what appeared on the rest of the documents on the record, including the certificate of title. It goes all without saying that Nkubito could not sell to Lubunde more than what he owned.

# 4 kggtlpttt oltp ^alp cneg;

The counter claimant testified that the Lubunde had connived with the UNRA officials and the 2n,rcounter defendant and obtained documents that had been presented to UNRA to demarcate off its portion and used the same to illegally transfer and register himself on the title to the suit land.

It is not in doubt that UNRA at some point held the title. However, the circumstances under which it had handed over the title to Lubunde and not the duly appointed attorney or the actual owner who purportedly signed the transfer forms remain unclear. It also leaves this court wondering as to why UNRA was never made party to the counter claim.

## 20 Other tssues rdlsed:

As submitted, this was jointly acquired land that ought to have been jointly registered in the names of Lubunde, the husband and wife as joint buyers. Nonetheless, it was registered in the names of the husband alone on 27b May, 2021 which raised other issues that could have been answered by Lubunde himsell

His further unchallenged claim was that his signatures were forged by Lubunde in a bid to fulfill his illegal actions. In the case of Makulo. Interrrqtlonal Vs Co.rdlnal Nsubuga Vlamala SCCA No.4 ol 1987, it was held that courts oflaw do not sanction what is illegal and once brought to the attention of court it overrides all questions of pleadings including admissions made thereon.

Fraud is such grotesque monster that courts should hound it wherever it rears its head and wherever it seeks to take cover behind any legislation. It unravels everything and vitiates all 30

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transactions. lFa.n Inter'latlo'to,l Ltd and Ahtn,o,d Fo.rah us Mohqrned El trltth [1994]X^RL 3O7).

It is trite law that that fraud that vitiates a land title of a registered proprietor must be attributable to the transferee and that fraud of a transferor not known to the transferee cannot vitiate the title. See.' Wantbuzl C. J, I<dmpdla. Bottlets as Da'ma,nlco (U) LTD, SCCA No. 27 ol2072.

The evidence led by Nkubito is sufficient to prove that: Lubunde never paid the full consideration for the purchase of the suit land within the agreed period, which forced Nkubito to look for another buyer to whom he sold his interest in the land; that Lubunde never bought the land as the sale agreement with him was rescinded. Thus the circumstances under which he got the title in his names were suspect.

The counterclaimant did not however lead evidence to pin the involvement of the 2"'r counter defendant in the fraud. All the above therefore puts to rest both {ssues No. 7 and 2,

## Issue No,3 : Remedles:

The counter claimant prayed for a declaration that the Registration of the 7"1 counler dekndqnl on title to lhe suit land uas illegal and fraudulent; that the 1! counter deJendant has no claim whatsoever on the suit land; general damages, ond cosls. 15

### Geraeral dannq,ges.

General damages are awarded at the discretion of court. Counsel cited the case of Uganda Commercl(rl Ba.nk Vs Ktgozt (2OO2)l EA 3O5, by which court guided that the consideration for an award of damages should be mainly the value of the subject matter, the economic inconvenience that a party has been put through and the nature and extent of the breach or injury. 20

This court taking into consideration the disturbance, mental anguish and inconvenience suffered by the counter claimant in trying to recover the ownership of the land and bearing in mind the fact that fraud was committed with Lubonde's knowledge and participation, an award of Ugx 20,OOO,OOO/- is granted as general damages to the counterclaimant. 25

Sectlon 777 of the RTA gives this court power to order the Commissioner, land Registration as I hereby do, to cancel the title for the land comprised in Euslro Block 439, plot No.7847, since 30 Lubonde has no interest therein.

In the premises,

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- 1) the counter claim is therefore allowed; - 2) Lubunde, the $2^{nd}$ counter defendant has no claim of interest in the suit land comprised in Busiro Block 439, plot No.1847; - $\mathsf{S}$ - 3) since Nkubito, the counter claimant received money from Lubunde, the 1^st counter defendant he is hereby ordered to refund all the money paid out as part consideration to Lubunde; - $10$ 4) Costs awarded to the counterclaimant.

Unlarg

Alexandra Nkonge Rugadya

Judge

20^th March, 2023