[1997] UGSC 24

## IN THE SUPREME COURT OF UGANDA

### (CORAH; WAMBUZl, C. J TSEKOOKO, J. S. C AT{D KAROKORA, J,S. C. )

### CIVIL APPEAL NO,10 OF 1996

| 1 | MBARARA MUNICIPAL COUNCIL | | | | r | | |---|-----------------------------|--|--|--|--------|--| | z | SHARIF ABDALLA :: :: :;:;;; | | | | )<br>) | | | J | | | | | )<br>] | |

and decree of the High Court of Uganda , dated 14th July, 1995) (Appeal from the j udgement at Kanpala, Rajasingham J

IN

## CIVIL SUIT NO.1065 OF 1988

1., I

> f have read in Tsekooko, number of draft the judgement prepared by my learned brother C. and also read the pleadings in this case and ^a ^T cause me concern

> On the pleadings the appellant brought an action in the High Court for a declaration that he is the rightful owner of the premises on Plot 13 Makhan Singh Street, Hbarara by virtue of ^a lease granted to him by the first respondent, Hbarara Municipal Council, for damages against the first respondent for breach of contract and for damages and an eviction order against thc secontl and third regpondents for treepass, among other reliefs sought.

> > I

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The f irst any lease respondent denied that it ]egally offered or granted of tho land in guestion to the appellant.

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The second and third respondents elaimed to have been granted ^a lease in respect of the plot in question which they developed to some extent. They alleged that the appellant obtained the lease of the property in question through fraud and counter-claimed for damages for trespass.

In these eircumstances, f am a litt1e puzzled that in effect the only issue at the trial was whether or not the lease to the appellant was obtained by fraud. The record indicates that there r.ra s some tliscussion on the issue but there is no indication that the pJ.eadings were amended. In my view, and with respect, one of the issues was surely whethor or not the seconal and the third respondents were granted a lease to develop the plot in question and if so what happened to that lease. Needless to say it is important to frame issues properly in any cas€ because th€ production of evidence depends on the issues to be resolved.

Be that as it may, the appellant testified in the court below that he applied to and was granted a lease of plot 13 Hakhan Singh Street, by the first respondent. The application was dat€d a-.1 :ii ^ Tt shor'rs that the building to be ereeted was commercial with a residence at the top and the valu€ was to be Shs.3.5m/=. The appellant inspected the plot and, in his own words,

)

I'I inspected the property after I got the offer. There were fountlations dug and some building materials - stone and sand on the site. f came to my lawyers and told them of it the Town Clerk told them the plot had reverteil to the Town Council. I produce a photocopy of that l€tter - marked ER 7."

Exh ER 7 reads as follows in so far as is relevant,

rrRE: LEASE OPFER - PIOT ¹³

MAKI{AT{ S]NGH STREET . MBARARA.

. . . The third party mentioned in your letter was offered ^a two year lease of the plot on 1st ApriI, 7976 and he stubbornly refused and did not honour the offer by failing to fuLfil the obligations of the offer. fhe lease expired and this was brouqht to the attention of the Lands and Surv€ys Department of the Council. In his letter Ref. l{o. LWM/5879 dated 30th January, 1980 a Senior staff aulveyor who is also the Land Agent of the Council advised that the Council takes the necesaary action, (a true copy of the Land Agentrs letter is attached hereby for your information). The matter was then brought before the Development and General Purpose Cornmittee mesting held on 18th Harch, 1980 (A true eopy of th€ extracts is also attached herewith for your information) anil it was resolved that the developer of the plot should not be offered extension of leas€ and that his prop€rty be offered to

)

another interested develop€r since he had refused the offer. Normally, grhen such cases occur the automatieally r6-ent6r whatever was offered respect. to accept authority in that

matter is in order and ahead with payment of you ean advise the property. Therefore the whole your client to go Yours faithfully.

JW R. Banyu.

c1erk.

c.c The IIon Hajor E. Rurangaranga, Hinister of State, Office of the Prime }rinister, Kampala

c.e The Land Agent ^P. O. Box 220, llbarararr.

The appsllant erected the building and was subs€quently granted a lease for ,19 year6. It was indicated during the course of the hearing that it was not disputed by the second and third respondents that a lease of 49 years was granted to the appe]1ant.

Apparently, the first respondent was beginning of the trial and its Counsel for it at the clos€ of the ease for not represented at the was the given leave to appsar appellant. Only one

witness, that was the the appellant, was recalled for crosg-examinat ion and appellant himself.

For the first respondent David Bashakara, th€ Town Clerk, since ¹⁹⁹⁰testified to the effect that the first respondent recognised the appellant as the legal owner of the plot in question and the first respondent did not deprive th€ appellant of the plot in question. He wondered why the appeLlant had sued the fir6t respondent and prayed that the case against the first respondent should be dismissed. This evidence is the exact opposite of tho first respondents pleadings. There is no indication that the pleadings were amended to reflect this turn around.

Be that as it may, Shariff Abdulla, the eecond respondent testified to having obtained a r6aae together rvith the third respondent to d€velop the pLot in question as well as plot 11 in L974. Ilowever, only plot 13 was developed. The buiJ.ding was completeal and a Temporary Oceupation permit was granted by the first respondent in 1978. Because of the war in 1979 the witness left the building in oeeupation of Vincent Hwahura, Bank Uanager of UeB. He returned to Mbarara in 1990 and was not allovrod to oeeupy the building. lle raised the iesue with the first respondent through letters Exhs. SA 3 and SA 4. He etaimed he was harasged by the authorities and had again to leave Mbarara until 1986. He learned that the first respondent had sold the building to the appellant but eould do nothing about it. The building was returned to him in 19BG by the first respondent.

q

The main issue in the Iease was obtained by court belov, was whether the grant of the fraud on the part of the appellant.

The Learned trial judge found as a fact that:

"The second and third defendants obtained a lease offer in respeet of Plots 11 and 13, Hakhan Singh Street, Ubarara, in 19?4 and an extension of th€ offer to the 1st Aprit. 19?8 by an application dated 22rd of April, 19?6 in which they indicated that the building on Plot 13 was almost eompleted - vide page 2 of trDBlrr. They w€re granted a year at a tim€ to complete the builtling on PIot 13.

The evidence of the second defendant anal tha plan rrBR 5tr, to my mind, establishes that the building on Plot 13 was completad by the time the second d€fendant fled the eountry in 1979, except perhaps for the construction of water and sewerage facilities, and that the defendants had in fact been granted a Temporary Occupation Pernit.t'

The learned trial judge aeeepted evidenee to the effect that the seeond and the third respondents in their letter of 2sti F€bruary 1980 requested for an extension of the lease for thr€e years, eommencing 13t April 1978, to carry out repairs on th€ building.

The Learned trial judqe accepted the evidence of Bashakara, the Town C1erk, that in his experience any developer who had reaehed th€ stage reached by the second and third respondents would be

granted an extension to eomplete the development.

Exh. DB 4 purports to be a minute of the Council Heeting held on 14tl March, 1980, it reads as follows:

# "Plot No. 11l13 Hakhan Sinqh St reet

The Town Clerk read out an application Ietter received from l,lr. Ah,ri AbduIIa, Ahmad Ahmed of p. O Box 160, Mbarara, in which he was applying for 3 (three) yeare lease extension to enable him eomplete the above plot which he had not been able to aeeomplish due to lack of building materials. After lengthy diseussion, it was resolved.

That since the would be developer did not aceept the made the plot/withdrawn and whatever the property was automatically reverted to the Council. on it

That the Council Technieat officers inspeet the building and assess the value of the building so as to enable the Council offer the plot to another interested developer. Also the Town (sic) reported that he was in possession of a eopy of a letter written by the above person authorizing someone eLse to take-over the property as the former was denying to be a resident of Uganala but of Kenya.,'

On the effect of this so-called minut€, the learned trial judge remarked:

On the effect of this so-calIed minute, the learned trial judge remarked:

"I am convinced that the rappropriation' of this developetl plot was executed by the Land Agent of Hbarara vrith the almost conspiratorial cooperation of officiaLs of the first defendant Council after the General Purpose Committee purporting, without the necessary powers to act for the Council purported to withdraw the lease offer made to second and third de fendants"

There was evidence considered by the trial judge that relevant time, there was no council and that the work Council was done by some officials. There was no evidence authority under which these officials were empowered to on the functions of the Council. at of of the the any

According to the letter on the lease offer from the Town Clerk Exh E. R. 7 , it vras the Development and General Purpoaes Committee which handled the withdrawaL of the lease offer from the respondents. Most probably, the same Committee grant6d th€ lease to the appellant and this may be the Committee of officials referred to in the evidence.

Under the Local Administrations and Urban Authorities Decree ¹⁹⁷¹ all District Councils, Hunicipal Councils and Town Councils were dissolved with effect from 31st January 1971 and the offices of

Secretary General, Assistant S€cretary Gen€ral , Hayor and Deputy Mayor lvere terminated.

Under Sect ion 1 of the Local Administrat ions and Urban Authorities (Vesting of Powers) Decree, L97L the administration of the affairs of every district, (ampala City Council, }{unicipal and Town Council and the duties and functions of the said councils were vested in a comrnittee appointed by the Hinister by Statutory Ord6r for a period not exceeding two years.

It appears that by the Local Administrations and Urban Authorities (Appointment of Committees ) order 1978, eommittees were appointed for a number of authorities including Mbarara Municipality. The Chairman and Deputy Chairman of each Committee were to be known as Mayor and Deputy Hayor respectively. The Order was to be deemed to have come into force on the 14th September , 1978,

As atready pointed out these Committees were appointed for ^a period not exceeding two years. It follows that the Committee appointed for the Municipality of Hbarara waa to IaEt for two years from the 14th September, 1978. There was no evidenco that this is the Committee which handled the lease in the case before us, but even if it was, the jurisdiction of the Committee to carry out the functions of Hbarara Municipal Council expired on 13th September, 1980 two y6ars from the date of its creation. I have not found any authori.ty extending the life of the Committee or appointing a new Committ€e for Mbarara Municipality

a

with the gr ant ed lease. result that on to the appe 1lant the 26th May, there was no authority to grant such ^a

the learned trial judge quite correctly in my view concluded:

"The withdrawal of the lease offer without the Council considering it, and made by a Committee of the Council without the requisite authority to act for the Council was void antl of no effect. In th€ absence of evidence that the Counci I as whole hatl authorised the ceneral Purpose Committee to make such decisions, the Committee cannot make them. The making of a lease offer without any evidence that it was considered and authorised by the Council is equally void and no effect. Land granta within shat is referreil to as a 'rdesignated urban area" may only be nade by the "designated authority" which under the PubIic Lands Act 1969 (13 of 1969) is defined as including Municipal Councils. Since there is no where in the minutes of the Hbarara Municipal Council any minute showing that the Council considered the plaintiffs application Iet alone that it decided to grant the plaintiff a lease of No.13 Makhan Singh Street, the grant to the plaintiff is void and of no effect. " What is the effect if a title to land is issued lrithout authority as in this case? Th€ matter was not argued nor did the learned trial judge a11ude to it. He appoars to have assumad that nothing could be done unless fraud was proved. In his own words:

> 'rThis does not, however, dispose of this case because the plaintiff is the registered title holder of Plot 13 Hahkan Singh Street, and the registration can only be challenged - s. (1) (c) (sic) in case of a person deprived of any land by fraud as against the person registered as proprietor of such land through fraud

I am not r e 1ev ant so sure that this is entirely correct. S.69 of the Registration of Titles Act In so far as is provides:

"In case it appears to the satisfaction of th€ Registrar that any certificate of title or instrument has been issued in error .. .. or that any entry or endorsement ha6 been made in error on any certificate of title or instrument, or that any certificate of titIe, instrument, entry or endorsement has been fraudulently or wrongfully obtained, or that any certificate of title or instrument is fraudulently or wrongfully retained, he may by writing require th€ p€rson to whom such document has been go issued or by whom it has been so obtained or is retained to deliver up the same for the purpose of being cancelled or

corrected or given to the proper party,as the case requires

On the face of it, it would appear that the Registrar of Titles ha6 power to cancel a certificate fraudulently or wrongfully obtained or retained. In my view it was open to the court in the case before us to declare that the certificat6 of title was wrongfully obtained. This would open the way for the second and third respondents to pursue their rights before th€ first respondent and the Registrar of Titles. I am aware of the provisions of Sections 56 and 184 of the Registration of Titles Act but in thia case the action was brought by the appellant and not by the respondents and I see no valid reason in law to prevent the second and the third respondents who were in possession of the property in question from pursuing any rights they may have had under S.69 of Registration of Titles Act.

I am also aware that these matters wer€ not pleaded but the case appears to have been conducted and evidence adduced arounal th€ general theme as to whether or not the lease to the appellant was properLy g!anted. on the pleadings the first respondent dlenied it IegaIIy granted any lease to the appellant.

Be that as it nay, the court went on to consider whether fraud had been established.

on the evidence before him, the learned trial Judge found that Bainomugisha, the land agent". orchestrated the appropriation of

the suit property with the assistance of the thus clefrauded the second and third th€n Town Clerk, defendants".

Quite rightly in my view the learned triaL judge posed the quest ion ,

"whether was aware this case the of on plaintiff was part of the fraud himself or the fraud on the Part of somebody else, in the part of Bainomugisha antl Banyu. "

He then made the curious finding that,

"fhe plaintiff obtained registration of his title under the Registrar of Titles Act by applying to the Registrar of TitIes and producing those supporting documents that he was required to produce. Honce the act of registration was not in itself fraudulentf

but presumably tainted with fraud.

The question to ask is what were the supporting alocumenta that were required to be proaluced?. If those alocum€nts included or were based on the grant of the lease by the Council, the learned trial Judge found the relevant minute was false as the Council did not grant nor authoriee the granting of the said lease ' The purported offer of the tease to the appellant the learnedl trial Judge found on the evidence to have been the work of Bainomugisha purporting to be authorised by the Council. What evidence tlitl

the appellant put before the granted the lease by the certificate of Title?. Registrar of TitLes that he had been Council for the issuance of the

It would appear to me that an aPplication for registration which to the knowledge of the applicant is based on an unauthorised grant is in itself fraudulent in so far as it is a false presentation to the Registrar of Titles that the Lease had been granted by the Council.

Civi I Appeal No.4 of 1990 (unreported ) the land Registry issued two certificates of title to different parties in respect of the same lriece of land. The High Court agreed that the second certificate of title had bsen wrongly issued and that it should be cancelled as it was issued in error because there was a subsisting title in respect of the same piece of land. On appeal it was n€c€ssary to decide when th€ secontl lease wag grantedl . Oder JSC clealt with the matter in this way,

"I think that it is adequate to consider the issue of what act on the part of the Commission should be regarded as having been the grant of the appellant's leasei that is to say whether it was the decision contained in minute 8/2/82 (a)(204) of Ausust, 1982, the offer of l7/8 /7986 or the Regietration of the appellant as the lessee on 8/9/L986 .. The Commission's grant was in r€sponse

to the appellant's application on a standard form (Exh. D.1) as he did not make any other application.

The app)-ication form was subsequently endorsed as approved by a minute of the Commission. therefore, th6 offer issued to the appellant also ref€rred to th€ minuts of the decision approving the application. According to the svidence of Maria (DW1 ), the grant was made by the Commissionrs minute 8/2/82 (a)(204) of August, 1982. That is also what the Secretary apparently intended to communicate to the appellant by his letter ot 2A/2/1987.

To my mind, the Secretary and Maria (DW1 ) were correct. The grant to the appellant should be regarded as having been, and in my opini.on it was made in August 1982 by the decision under the minute already referred as testified to by Maria (DW1 ). The decision granting the lease having been made in response to th6 appellant,s application, it was not an internal matt€r not binding on the Commission in relationship to the appellant.

This would in my view, appear to explain the reference to the minute of the decision on the approved application form and the lease offer. The grant made under that minute was the root from which the offer and the appellant's certificate of title derived their validity. The grant having been made in August 1982 when the suit prop€rty was not available for leasing owing to the respondent ,s

Ieasehold which was sti11 subsisting at that time, the Commission, in my view,, was justified in wanting to cancel it as communicated to the appellant's lawyers by Exh. P.3."

In the made by instant case the grant, the root of the title, was not

The learned trial judge considered the evidence before him and conc Iutled :

"The plaintiff was a District Commissioner and then Deputy l,linister of Local government in 1980, and must, at least in the latter office, have been aware that an application for a tolrn plot had to be made to the designated authority, the Municipal Council. Yet in early 1981, he appears to have given his application to the Land Agent, if indeed he had made a formal application at all. Then, without anything Lo show that the Council met to consider his application, it is endorsed by Bainomugisha, the Land Ag6nt on the 25th llay 1981, and a lease offer made to him on 26tL Uay, 1981. Even if this was the result of awe of fear or even respect for his position, the plaintiff knew that the requisite approval of the Council hatl not been obtained. The plot had not been withdrawn at the time Bainomugisha wrote to the Council on 30th January, 1980, to draw its attention to the expiry of the second and third defendants lease offer. Although it is possible that Bainomugisha, who had not yet reeeived the pJ.aintif f 's application at that time, may have

been acting on his own, it seems unlikely in view of subsequent actions of Bainomugisha and Banyu. Be that as it may, the plaintiff in his evidence stat€d that there was only a pile of sand and stone and some excavation of ^a foundation on the plot rthen he examinecl after he received the leaee offer. This we know as a certainty was totally untrue. Why then did he lie in court?

Admittedly evidence of this is post facto but to my mind it is gui 1ty knowledge" .

For my own part I am satisfied on the evidence that:

- l1,l The had app€llant knew that the propertY he had applied for been developed or substantially developed by another person and he lied about it in his evidence. - (2) Through his lawyers the aPPellant was assur€d that the prop6rty had been withdrawn from the first developer. Exh. ER 7 is a detailed letter by the Town Clerk giving detaile of the lease offer to the third party, the expiry of the lease, a copy of the letter of the Land Agent suggesting appropriate action, a coPy of the minute of the General Purpose Committee and resolution not to extend th€ lease of the third party. one would have expected the same letter which gave such details regarding withdrawal of the first offer to provide similar details regarding the grant of the lease to the appellant, such as date of the meeting

of the Council, the minute regarding the decision of the Council, etc. On the contrary this important issue is dealt with in one sentence:

"The whole matter is in order and you can advise your client to go ahead with payment for the property".

This lends support to the inference that those details were not there. In other words, that there was no meeting of the Council and no decision to grant the lease to the appellant by the Council.

(3) It is admitted by the appellant that there was no Council at the material time but there was no indication in the Court below or before us of under what authority the officials acted for the Council.

On the evidence I am unable to fault the learned trial Judge's conclusion that the appellant was aware that his application had not been considered or granted by the Council and he knew of the fraud on the land office by the Council officials and he took advantage of it by applying and obtaining a lease in respect of the property in question.

I would dismiss the appeal against the decision of the lower court on the issue of fraud and the related orders.

On the issue of damages the learned trial Judge awarded ⁷,2OO,OOO shi1lings as special damages to the second and third respondents.

In their amended written statement of defence, the second and third respondents counterclaimed against th€ appellant and alleged in effect that the appetlant fraudulentry connived with officials of the first respondent to alrocate plot 13 Hakhan street, as if the same had not been developed and as a result the second and third respondents incurred loss of rent from 19g1-19g7 to the tun€ of 7.2 million shillings.

I nust confess, I am unable to find any evidence that the appellant took part or that he influenced the withdrawar of the offer of the lease from the second and third respondents. In any cas6 on the respondents own evidence, their lease expired on the first April 1978 and they had infact appried for an extension of three years. fhe extension was not grantedt. whatever their claim may be against the first respondent, I am unable to see any basis for their claim against th€ appetlant for trespass to the property in question or for loss of rent as the respondents had no interest in tbe property.

To that ext€nt, I would a11ow the appeal relating to damages and alter the judgment and the Decree of the court below by dismissing the part of the counterclaim of the second and third respondents relating to trespass and loss of rent. I would accordingly set aside the award of special damages in the sum of

$\rm 7.2$ million shillings. I would give the appellant half the costs $\hbox{ of the Appeal.}$

As Karokora JSC agrees with my proposed orders there will be orders in those terms.

Dated at Mengo this ... 8..... day of August... 1997.

S. W. W. WAMBUZI CHIEF JUSTICE

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