[2005] UGCommC 30

{\rtf1\ansi\ansicpg1252\uc1\deff0\stshfdbch0\stshfloch0\stshfhich0\stshfbi0\deflang1033\deflangfe1033{\fonttbl{\f0\froman\fcharset0\fprq2{\*\panose 02020603050405020304}Times New Roman;}{\f36\fswiss\fcharset0\fprq2{\*\panose 020b0604030504040204}Tahoma;} {\f37\froman\fcharset238\fprq2 Times New Roman CE;}{\f38\froman\fcharset204\fprq2 Times New Roman Cyr;}{\f40\froman\fcharset161\fprq2 Times New Roman Greek;}{\f41\froman\fcharset162\fprq2 Times New Roman Tur;} {\f42\froman\fcharset177\fprq2 Times New Roman (Hebrew);}{\f43\froman\fcharset178\fprq2 Times New Roman (Arabic);}{\f44\froman\fcharset186\fprq2 Times New Roman Baltic;}{\f45\froman\fcharset163\fprq2 Times New Roman (Vietnamese);} {\f397\fswiss\fcharset238\fprq2 Tahoma CE;}{\f398\fswiss\fcharset204\fprq2 Tahoma Cyr;}{\f400\fswiss\fcharset161\fprq2 Tahoma Greek;}{\f401\fswiss\fcharset162\fprq2 Tahoma Tur;}{\f402\fswiss\fcharset177\fprq2 Tahoma (Hebrew);} {\f403\fswiss\fcharset178\fprq2 Tahoma (Arabic);}{\f404\fswiss\fcharset186\fprq2 Tahoma Baltic;}{\f405\fswiss\fcharset163\fprq2 Tahoma (Vietnamese);}{\f406\fswiss\fcharset222\fprq2 Tahoma (Thai);}}{\colortbl;\red0\green0\blue0;\red0\green0\blue255; \red0\green255\blue255;\red0\green255\blue0;\red255\green0\blue255;\red255\green0\blue0;\red255\green255\blue0;\red255\green255\blue255;\red0\green0\blue128;\red0\green128\blue128;\red0\green128\blue0;\red128\green0\blue128;\red128\green0\blue0; \red128\green128\blue0;\red128\green128\blue128;\red192\green192\blue192;}{\stylesheet{\ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 \snext0 Normal;}{\*\cs10 \additive \ssemihidden Default Paragraph Font;}{\*\ts11\tsrowd\trftsWidthB3\trpaddl108\trpaddr108\trpaddfl3\trpaddft3\trpaddfb3\trpaddfr3\tscellwidthfts0\tsvertalt\tsbrdrt\tsbrdrl\tsbrdrb\tsbrdrr\tsbrdrdgl\tsbrdrdgr\tsbrdrh\tsbrdrv \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs20\lang1024\langfe1024\cgrid\langnp1024\langfenp1024 \snext11 \ssemihidden Normal Table;}{\s15\ql \li0\ri0\widctlpar \tqc\tx4320\tqr\tx8640\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 \sbasedon0 \snext15 \styrsid1118075 footer;}{\*\cs16 \additive \sbasedon10 \styrsid1118075 page number;}{ \s17\ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \f36\fs16\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 \sbasedon0 \snext17 \ssemihidden \styrsid16126339 Balloon Text;}}{\*\latentstyles\lsdstimax156\lsdlockeddef0} {\*\listtable{\list\listtemplateid-2044950092\listhybrid{\listlevel\levelnfc0\levelnfcn0\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698703\'02\'00.;}{\levelnumbers\'01;}\fi-360\li720 \jclisttab\tx720\lin720 }{\listlevel\levelnfc4\levelnfcn4\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698713\'02\'01.;}{\levelnumbers\'01;}\fi-360\li1440\jclisttab\tx1440\lin1440 }{\listlevel \levelnfc2\levelnfcn2\leveljc2\leveljcn2\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698715\'02\'02.;}{\levelnumbers\'01;}\fi-180\li2160\jclisttab\tx2160\lin2160 }{\listlevel\levelnfc0\levelnfcn0\leveljc0\leveljcn0 \levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698703\'02\'03.;}{\levelnumbers\'01;}\fi-360\li2880\jclisttab\tx2880\lin2880 }{\listlevel\levelnfc4\levelnfcn4\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360 \levelindent0{\leveltext\leveltemplateid67698713\'02\'04.;}{\levelnumbers\'01;}\fi-360\li3600\jclisttab\tx3600\lin3600 }{\listlevel\levelnfc2\levelnfcn2\leveljc2\leveljcn2\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext \leveltemplateid67698715\'02\'05.;}{\levelnumbers\'01;}\fi-180\li4320\jclisttab\tx4320\lin4320 }{\listlevel\levelnfc0\levelnfcn0\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698703 \'02\'06.;}{\levelnumbers\'01;}\fi-360\li5040\jclisttab\tx5040\lin5040 }{\listlevel\levelnfc4\levelnfcn4\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698713\'02\'07.;}{\levelnumbers\'01;} \fi-360\li5760\jclisttab\tx5760\lin5760 }{\listlevel\levelnfc2\levelnfcn2\leveljc2\leveljcn2\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698715\'02\'08.;}{\levelnumbers\'01;}\fi-180\li6480\jclisttab\tx6480\lin6480 } {\listname ;}\listid1282108935}}{\*\listoverridetable{\listoverride\listid1282108935\listoverridecount0\ls1}}{\*\rsidtbl \rsid603855\rsid1118075\rsid1992110\rsid2389288\rsid2445768\rsid3019924\rsid3481711\rsid3889652\rsid4064104\rsid4143699\rsid4144877 \rsid4398142\rsid4468820\rsid4478534\rsid4594768\rsid4595053\rsid5661868\rsid7167006\rsid7215621\rsid7605699\rsid7744570\rsid8028036\rsid8798861\rsid8803350\rsid9134917\rsid9266408\rsid9387151\rsid9713135\rsid10228129\rsid10372160\rsid11211781 \rsid11549581\rsid11754423\rsid11939828\rsid12064398\rsid12147751\rsid12259043\rsid12280723\rsid12456272\rsid12745330\rsid12809757\rsid13042057\rsid13109808\rsid13719735\rsid13846656\rsid13854777\rsid14305984\rsid14427654\rsid14769451\rsid15364918 \rsid15429501\rsid15498854\rsid15541088\rsid15815268\rsid15994982\rsid16081742\rsid16126339\rsid16414290\rsid16459721\rsid16473349}{\*\generator Microsoft Word 11.0.6568;}{\info{\title THE REPUBLIC OF UGANDA}{\author Egonda-Ntende}{\operator Harry Mak} {\creatim\yr2006\mo2\dy7\hr10\min14}{\revtim\yr2006\mo2\dy7\hr10\min14}{\printim\yr2005\mo5\dy26\hr11\min38}{\version2}{\edmins0}{\nofpages3}{\nofwords785}{\nofchars4477}{\*\company Courts of Judicature}{\nofcharsws5252}{\vern24579}} \widowctrl\ftnbj\aenddoc\noxlattoyen\expshrtn\noultrlspc\dntblnsbdb\nospaceforul\formshade\horzdoc\dgmargin\dghspace180\dgvspace180\dghorigin1800\dgvorigin1440\dghshow1\dgvshow1 \jexpand\viewkind1\viewscale85\pgbrdrhead\pgbrdrfoot\splytwnine\ftnlytwnine\htmautsp\nolnhtadjtbl\useltbaln\alntblind\lytcalctblwd\lyttblrtgr\lnbrkrule\nobrkwrptbl\snaptogridincell\allowfieldendsel\wrppunct \asianbrkrule\rsidroot9387151\newtblstyruls\nogrowautofit \fet0{\*\ftnsep \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 {\insrsid14305984 \chftnsep

\par }}{\*\ftnsepc \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 {\insrsid14305984 \chftnsepc \par }}{\*\aftnsep \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 {\insrsid14305984 \chftnsep \par }}{\*\aftnsepc \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 {\insrsid14305984 \chftnsepc \par }}\sectd \linex0\endnhere\titlepg\sectlinegrid360\sectdefaultcl\sectrsid1118075\sftnbj {\footer \pard\plain \s15\ql \li0\ri0\widctlpar\tqc\tx4320\tqr\tx8640\pvpara\phmrg\posxc\posy0\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid14305984 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 {\field{\*\fldinst {\cs16\insrsid1118075 PAGE }}{\fldrslt {\cs16\insrsid15815268 2}}}{\cs16\insrsid1118075 \par }\pard \s15\ql \li0\ri0\widctlpar\tqc\tx4320\tqr\tx8640\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\insrsid1118075 \par }}{\*\pnseclvl1\pnucrm\pnstart1\pnindent720\pnhang {\pntxta .}}{\*\pnseclvl2\pnucltr\pnstart1\pnindent720\pnhang {\pntxta .}}{\*\pnseclvl3\pndec\pnstart1\pnindent720\pnhang {\pntxta .}}{\*\pnseclvl4\pnlcltr\pnstart1\pnindent720\pnhang {\pntxta )}} {\*\pnseclvl5\pndec\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl6\pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl7\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl8 \pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl9\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}\pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang1024\langfe1024\cgrid\noproof\langnp2057\langfenp1033 {\b\insrsid9387151\charrsid13109808 THE REPUBLIC OF UGANDA}{\b\insrsid4594768\charrsid13109808 \par }{\b\insrsid9387151\charrsid13109808 \par IN THE HIGH COURT OF UGANDA AT KAMPALA \par \par (COMMERCIAL COURT DIVISION) \par }{\b\insrsid12456272\charrsid13109808 \par HCT-00-CC-OS-0001-2005 \par }{\insrsid12456272 \par Uganda Ecumenical Church Loan Fund Ltd}{\insrsid13109808 Plaintiff}{\insrsid12456272 \par \par Versus \par \par Mary Florence Nabiyinja Mbuga}{\insrsid13109808 Defendant}{\insrsid12456272 \par \par }{\b\ul\insrsid16414290\charrsid13109808 BEFORE: THE HONOURABLE MR. FMS EGONDA-NTENDE}{\b\ul\insrsid12456272\charrsid13109808 \par }{\insrsid16414290 \par }{\b\ul\insrsid16414290\charrsid13109808 JUDGMENT \par }{\insrsid16414290 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid16414290 \hich\af0\dbch\af0\loch\f0 1.\tab}}\pard \ql \fi-360\li720\ri0\sl360\slmult1\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls1\adjustright\rin0\lin720\itap0\pararsid16081742 { \insrsid16414290 The Plaintiff, Uganda Ecumenical }{\insrsid12147751 Church Loan Fund Ltd, is seeking}{\insrsid16081742 ,}{\insrsid12147751 by way of originating summons, }{\insrsid2445768 to recover from Mary Florence N abiyinja Mbuga, the defendant in this action, Shs7,430,000.00, with interest at 28% per annum, }{\insrsid2389288 general damages for breach of contract, and costs of this suit, by foreclosure and sale of the property}{\insrsid4144877 comprised in Block 254 Plot No.}{\insrsid3019924 145 at Kasanga, hereinafter referred to as the suit property, of which the defendant is the registered proprietor.}{\insrsid16414290 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid16081742 \hich\af0\dbch\af0\loch\f0 2.\tab}}{\insrsid16081742 The Plaintiff, in the originating summons, asks this court to determine the following questons:}{\insrsid10228129 }{\insrsid16081742 }{\insrsid9134917 i) Whether the Mortagage/Plaintiff is entitled to foreclose the mortgagor\rquote sright of redemption of the suit property; }{\insrsid10228129 }{\insrsid9134917 ii) Whether the Mortgage/Plaintiff is entitled to sell the suit property; }{ \insrsid10228129 }{\insrsid9134917 iii) Whether the Mortgage/Plaintiff is entitled to an order for payment of U. Shs.7,430,000.00, interet thereon and general damages for breach of contract; iv)}{\insrsid7744570 Whether the Defendant/Mortgagor should pay the costs of this suit; and }{\insrsid10228129 }{\insrsid7744570 v) Whether the Mortgage/Plaintiff is entitled to any other relief.}{\insrsid16081742 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid14769451 \hich\af0\dbch\af0\loch\f0 3.\tab}}{\insrsid14769451 The defendant is the registered proprietor of the suit property. She granted to the principal borrower, M/S Tweyambe Kitodha Development Group}{\insrsid12809757 , vide a power of attorney dated 23}{\super\insrsid12809757\charrsid12809757 rd}{\insrsid12809757 July 1997, }{\insrsid4064104 authority to use the suit property,or the certificat of title thereto, as a security for a loan from \'93EDOF of PO Box }{\insrsid15498854 22886 Kampala.}{\insrsid15429501 M/S Tweyambe Kitodha Development Group, proceeded to sign a mortgage deed with the Plaintiff in respect of the sum advanced to be secured by the suit property.}{\insrsid8798861 The mortgage deed was never registered with the Registrar of Titles.}{ \insrsid7744570 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid3889652 \hich\af0\dbch\af0\loch\f0 4.\tab}}{\insrsid3889652 In an affidavit sworn by Naate Masangazira, the National Progarm Manager of the Plaintiff, it is averred inter alia, that despite incessant demands the principal borrower has failed to pay the principal amount, and interest}{\insrsid13846656 .}{\insrsid15541088 This affidavit is not contradicted. I accept the claim tha the principa}{\insrsid11939828 l}{\insrsid15541088 borrower has failed to pay the principal amount and interest.}{\insrsid8798861 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid9713135 \hich\af0\dbch\af0\loch\f0 5.\tab}}{\insrsid9713135 A mortgagee under the Mortgage Act, may realise his security by proceeding in any number of ways provided by the Act. In this instance it seeks foreclosure. Foreclosure is governed by Section }{\insrsid11211781 8 of the Act. I will set it out. }{\insrsid11754423 \par }\pard \ql \li1440\ri1440\widctlpar\aspalpha\aspnum\faauto\adjustright\rin1440\lin1440\itap0\pararsid13854777 {\fs20\insrsid11211781\charrsid13854777 \'938. Foreclosure }{\fs20\insrsid11754423\charrsid13854777 }{\fs20\insrsid13854777 }{\fs20\insrsid11754423\charrsid13854777 }{\fs20\insrsid11211781\charrsid13854777 (1) A mortgagee may apply to court to foreclose the right of the mortgagor to redeem the mortgaged land anytime after the breach of covenant to pay. }{\fs20\insrsid11754423\charrsid13854777 }{ \fs20\insrsid13854777 }{\fs20\insrsid11754423\charrsid13854777 }{\fs20\insrsid11211781\charrsid13854777 (2) Upon an application by the mortgagee under this section, the court shall determine the amount due to the mortgagee and may fix a date, not exceeding six months from the date of the failure to pay, within which the mortgagor shall pay the amount due. }{ \fs20\insrsid11754423\charrsid13854777 }{\fs20\insrsid11211781\charrsid13854777 (3) If the mortgagor fails to pay on the date fixed by the court under the subsetion (2), the court shall order that the mortgage be}{ \fs20\insrsid4143699\charrsid13854777 }{\fs20\insrsid11211781\charrsid13854777 foreclosed}{\fs20\insrsid4143699\charrsid13854777 of his or her right to redeem the mortgaged land and that the land be o ffered by the mortgage for sale in accordance with Section 9.\'94}{\fs20\insrsid15541088\charrsid13854777 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid12280723 \hich\af0\dbch\af0\loch\f0 6.\tab}}\pard \ql \fi-360\li720\ri0\sl360\slmult1\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls1\adjustright\rin0\lin720\itap0\pararsid16081742 { \insrsid12280723 Applying the above provisions, in light of the present }{\insrsid603855 suit}{\insrsid12280723 , I determine that the sum of shs.7}{\insrsid15994982 ,430,000.00 , being the principal amount, and interest at the rate of 20% per annum, from the }{\insrsid603855 15}{\super\insrsid603855\charrsid603855 th}{\insrsid603855 August 1997 to the date of filing of this suit,}{\insrsid11549581 22}{ \super\insrsid11549581\charrsid11549581 nd}{\insrsid11549581 February 2005 is due from the principal borrower to the Plaintiff.}{\insrsid14427654 Though in paragraph 13 of the supporting affidavit }{\insrsid7167006 the }{\insrsid3481711 P}{ \insrsid7167006 laintiff claimed interest at the rate of 28% per annum, I find no support for this rate of interest}{\insrsid3481711 on the evidence}{\insrsid7167006 . The mortgage deed reads agreed interest to be 20% per annum}{\insrsid4398142 and this is repeated in paragraph 7 of the affidavit}{\insrsid7167006 . }{\insrsid4143699 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid8803350 \hich\af0\dbch\af0\loch\f0 7.\tab}}{\insrsid8803350 I order }{\insrsid13719735 the Mortgagor to pay the said amounts of money to the Plaintiff}{\insrsid12745330 , and interest at court rate from 22}{\super\insrsid12745330\charrsid12745330 nd}{\insrsid12745330 February 1997 till payment in full,}{\insrsid13719735 within a period of 3 months }{\insrsid12064398 from today }{\insrsid13719735 to expire on }{ \insrsid12064398 31}{\super\insrsid12064398\charrsid12064398 st}{\insrsid12064398 August 2005.}{\insrsid10372160 In event of default thereof, the Plaintiff shall come back before this court, }{\insrsid4468820 for an order of foreclosure.}{ \insrsid8803350 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid7605699 \hich\af0\dbch\af0\loch\f0 8.\tab}}{\insrsid7605699 I direct that the mortgagor/defendant be notified of this order by the plaintiff }{\insrsid8028036 t hrough a newspaper with national circulation as efforts }{\insrsid11754423 at}{\insrsid8028036 personal service had }{\insrsid16126339 previously }{\insrsid8028036 failed, and the last service was by way of substituted service. }{\insrsid7605699 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid1992110 \hich\af0\dbch\af0\loch\f0 9.\tab}}{\insrsid1992110 The plaintiff has claimed general damages in this action.}{\insrsid13042057 This is misplaced, in my view, as it is not envisioned }{\insrsid16459721 under}{\insrsid13042057 Order 34 Rule 3A }{\insrsid16459721 under }{\insrsid13042057 which provisions this action was brought.}{\insrsid16473349 This claim for general damages is accordingly dismissed.}{ \insrsid1992110 \par {\listtext\pard\plain\lang1024\langfe1024\noproof\langnp2057\insrsid4478534 \hich\af0\dbch\af0\loch\f0 10.\tab}}{\insrsid4478534 The defendant shall bear the costs of these proceedings. \par }\pard \ql \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid4478534 {\insrsid4478534 Dated at Kampala this 1}{\super\insrsid4478534\charrsid4478534 st}{\insrsid4478534 day of June 2005 \par \par \par \par FMS Egonda-Ntende \par }\pard \ql \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16459721 {\insrsid4478534 Judge}{\insrsid5661868 \par }\pard \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\insrsid5661868 \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par \par }}