[2024] UGCA 79

#### THE REPUBLIC OF UGANDA

### IN THE COURT OF APPEAL OF UGANDA AT KAMPALA

#### **MISCELLANEOUS APPLICATION NO. 234 of 2017** (Arising out of Mbale High court Civil Suit No. HCT-04-CV –CS-0026- $10$ $2012)$

APPLICANT **UGANDA REVENUE AUTHORITY**

## 15

**VERSUS**

1. M/S URGENT CARGO HANDLING LIMITED

2. GERRY ANDREW MSAFIRI

**RESPONDENTS**

#### 20

#### CORAM: HON. JUSTICE RICHARD BUTEERA, DCJ. HON. JUSTICE CATHERINE BAMUGEMEREIRE, JA. HON. JUSTICE CHRISTOPHER GASHIRABAKE, JA)

## **RULING OF COURT**

### 1. Background.

This Application was lodged in this Honourable Court under rules 5, 42 (2), and 76 of the Judicature (Court of Appeal rules) Directions SI 13-10 and Section 98

of the Civil Procedure Act, Cap 71, on 9^th August 2017 seeking orders that; 30

- a) Leave is granted to appeal out of time; - b) Costs of the Application be provided for.

The Grounds upon which the application is based, as listed in the Notice of Motion, are:

- 35 - a) The Applicant was only made aware of the judgment in Civil Suit No. 26 of 2012 on 2^nd August 2017 following a search on the court record after being served with a Bill of costs on 26^th July 2017. - b) The Applicant has filed this application in reasonable time after learning of the Judgment in Civil Suit No. 26 of 2012.


$\mathsf{S}$

⁵ c) 'l ha1 it is in thc intcrcst ol' justicc that thc Applicant bc allowcd an cxlcnsion ol'timc to Appcal.

'l hc Application is supportcd by thc Al lldavit o1' Mr. I laluna Mbccta, ^a supcn'isor in thc lcgal Scrviccs and lloard Allairs l)ivision ol'1hc Applicant. IIc statcs that:

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a) ln 2012. IIigh Court Civil Suit No. 0026 ot'2012 to \,,iU lJrgcnt Cargo Ilandling L1d & (icrry Andrcr.r, Msallri v IJganda ll.cvcnuc Authority was lodgcd. and it llrsl camc up lirr hcaring on 25th Junc 2013.

- b) 'l hc mattcr progrcsscd and rvas bcing hcard irrtcrparty at all matcrial timcs until 2"'r I)cccnrbcr 2015. whcn thc mattcr was adjourncd to 24th - l;cbruary 2016 rvhcn thc l)cftndant (tlltA) was supposcd to producc its \\ rtn css - c) On l3rr' I)cccnrbcr 2016. unknown to thc l)clcndant (tJItA). thc mattcr camc up lbr hcaring in thc ahscncc ot'thc dcl'cndant at which hcaring thc l)laintill' sought lcavc to havc thc l)clcndant's casc closcd lbr nonappcarancc ancl sought to lllc ',r'rittcn submissions and thc mattcr bc lixcd Ior judgmcnt. - d) lhc ordcr to closc thc l)clcndant's casc was grantcd by court on thc basis ol'Allldavit cvidcncc bcing thc al'lldavit ol'scrvicc of onc lirap l{obcrls to thc cl Icct that hc Iirund an unnamcd malc rcccptionist whom hc scrvcd thc hcaring noticc whcrcas thc lcgal dcparlmcnt has no rcccption nrlr malc rcccptionist. - c) On lgtl' .lanuary 20 17. unknown to thc Applicant, and without scrving thc dcl'cndant, thc llcspondcnt Illcd its submission in thc I ligh Court civil suit No.26 ol'2012. - .10



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- g) In thc.judgmcnt, thc I'laintiff'was awardcd rcliclis that arc astronomical such as [JSI) 33,600 cach month liom 2012 to datc as lost camings liom a vchiclc whosc valuc thc judgmcnt placcs at tJSl) 46.000 which dccrcc could not havc gonc unchallcngcd wcrc thc I)clcndant awarc. - h) On 26th July 2017. thc ltcspondcnt scrvcd on thc Applicant/ l)cl'cndant ^a laxation hcaring noticc li)r a bill ol'costs to hc taxcd on l6rr' August 2017. - i) lhis application has bccn brought rvithout dclav and in rcasonablc tintc Ibllowing thc Applicant lcarning ol thc .ludgrncnt in Civil Suit no. 26 ol' 2012.

i) It is.iust and propcr that this Application bc -rtrantcd to allirrd thc issucs raiscd in thc intcndcd appcal to bc dctcrmincd.

# 2. Rcnly by thc licspondcnts.

'[ hc ltcspondcnts lodgcd an Al'lldavit in rcply dcposcd by I loshomc Ongoli Arungah, a Kcnyan citizcn cnrploy'cd by M/S l)rgcnt Cargo I landling Ltd on l5'h l)cccmbcr 2017. ln thc Allidavit. it is contcndcd that:

- a) At all matcrial tirncs, (icrry Andrcw Msaljri rvas onc ol'thc company drivcrs. - b) It was his cvidcncc at thc lrial that thc company truck was totally vandalizcd and thc lcarncd trial .judgc lirund so in his.iudgmcnt and conscqucntly awardcd thc ncccssary rclicl- in monctary tcms. 'lhcrc cannot thcrclbrc bc any praycr anymorc lilr unconditional rclcasc ol'thc truck as allcgcd in thc Noticc ol'Motion. - c) t'hc Applicant parlicipatcd in thc trial by lilling thcir plcadings and cross cxamincd thc llcspondcnt/ l)laintillis in Court until thc closc ol'our casc. - A datc was llxcd in opcn courl in thc prcscncc ol'thc Applicanl to bcgin thcir dclcncc but thcy also did not appcar. 'l hc suit rvas thcrcltrrc hcard and concludcd cx-partc and thc only coursc availablc lilr thc applicant is


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- kr apply to thc trial court lo sct asidc its procccdings and Judgmcnt and cnablc thcnr prcscnt thcir casc but not to appcal kr this onourablc Court. - d) Judgmcnt was dclivcrcd in opcn cou( on thc 25th Lpril 2017 and ccrtillcd procccdings wcrc availahlc on thc I't Junc 2017 but thc Applicant's counscl ncvcr hothcrccl to collcct thcm liom thc l{cgistrar. IIigh Court M balc. - c) 't hc Applicant's lc11cr rcclucsting lor ccrtillcd procccdings on lTrh Novcmbcr 201 7 is mcrcly a covcr up and was out ol'timc. - r) 'lhcrc was no nccd to appcal in this mattcr as this mattcr procccdcd intcrpartics on 2t'' April 2015,23"r July 2015. 3'd March 2015, ltlth Junc 2015, 2\*i I)cccnrhcr 2015. l31h l)cccmbcr 2016 and ltl'h April 2017. - s) On l3'l' l)cccrnbcr 201(r. thc Applicant's counscl rvas supposcd to comc to Court and conduct thcir dclcncc and thcrc was a [{cturn ol'scrvicc in lirrm ol'an Allldavit ol'Scrvicc and [JI{A duly acknowlcdgcd scrvicc by thc Assistant Commissioncr Litigation stamping and signing thc I lcaring Noticc on 30'l' Scptcrnhcr 2016 hut counscl did not appcar in Court lor ^Iurthcr hcaring. - h) 'l hc (iamishcc Ordcr Nisi rvas grantcd, scrvcd and cxcculcd as pcr Anncxlurc "llA" and thc (janrishcc Ordcr has alrcady bccn issucd by thc Assistant l{cgistrar Mary Ikit in Misccllancous Application No.234 ol' 2017 (Arising out ol'Mbalc lligh Courl Suit No. IIC'I'-04-CV-CS-0026- 2012) - r) 'lhcrc is no application lor lcavc to Appcal lirst lodgcd in thc I Iigh Court ot'lJganda Mbalc hclirrc it was lilcd in thc Court ol'Appcal at Kampala. - It is not truc that thc llcspondcnts wcrc awardcd an astronomical award ol' LJSI) 33.600 cach monlh lionr 2012 to datc. i) - 'l'hc laxation procccdings havc alrcady bccn conductcd and thcrc was no appcal prcl'cncd in thc I ligh Court ol' Mbalc against thc taxation procccclings. W k)

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^l l) 'l'hc Applicant has not lilcd a propcr Noticc ol'Appcal and a lcttcr rcqucsting lilr procccdings duly scrvcd on thc l{cspondcnl's larvycr as thcir noticc ol' Appcal was Iilcd 206 days latc alicr thc Iligh Court Judgmcnt was dclivcrcd.

# 4. Rcrr rescntation.

- Whcn this Application was callcd lirr hcaring on 24rl' Novcmbcr 2022, Mr. I{onald l}aluku. acting Managcr appcarcd lbr thc Appcllant. 'l hc l\* and ld I{cspondcnts wcrc rcprcscntcd by Mr. Jamcs Okuku and Mr. Justinc Scmuyaba. At thc hcaring. lcavc rvas grantcd b1, thc Courl to thc partics to procccd by rvay ol'writtcn submissions. Wc havc considcrcd thc submissions ol'thc panics duly l0 - lodgcd in thc Court and thc authoritics thcrcundcr in thc prcparation ol'this ruling. l5

## 5. Submissions bv thc Anplicant

'l'hc Applicant lodgcd writtcn submissions in this court on f i' Nilvcnrb cr 2022. ln thc suhmissions, thc Applicant avcrrcd that it has an automatic right ol'appcal

- in a mattcr ol'this naturc. Counscl lirr thc applicant rclicd on thc dccision in Salcm Ahmcd llassan Zaidi v Faud llumcidan ., Civil Appcal No. 5l of 1959 whcrcin it u'as hcld that.judgmcnt pronounccd against a partl must bc dccmcd to bc a dccision on thc rncrits and has thc sarnc cllcct as a dismissal upon cvidcncc and thc rnaltcrs in issuc nrust bc clccurccl to havc hccn hcard ancl 20 - dctcrmincd and as such.an aggricvcd party has thc right ol'appcal. 't hc Applicant subrlittcd that this Court. on its orvn rlotion undcr rulc 42, can grant lcavc as was considcrcd in thc dccision ol' Kasinrbazi ,lamcs ^v Tumwcbaze Olivia, CACA No.265 of 2016. l5

'l hc Applicant rclicd on this Court's pou'crs in rulc 5 ol'thc Judicaturc (Court ol' Appcal rulcs) I)ircctions which givcs this Court powcrs to cxtcrrd tinrc within rvhich to appcal rvhcthcr bclirrc or alicr thc act is donc. Ihc Applicanl subnrittcd that it has sullicicnt rcasons to satisly thc conditions lbr grant ol'cxtcnsion ol' timc. Sullicicnl causc has bccn dclincd in thc casc ol' Atlorncy (icncral ^v 30

P-- ⁵

Oriental Construction Company Ltd, Application No. 7/90. In this case, the $\mathsf{S}$ court acknowledged that mistake of counsel may sometimes amount to sufficient cause but only if they amount to an error of judgment.

In the instant case, the Applicant relies on negligence of counsel considering that the counsel (Mr. Kitaka) who was in personal conduct of the matter, left

the Applicant's employment without informing them of the conclusion of the $10$ case. The Applicant filed its witness statements in time but was unavailable at the hearing of the case hence forcing the court to proceed under Order 17, rule 4 of the Civil Procedure rules.

The Applicant relied on the decision in Al Hajji Ziraba Balyejusa versus

- Development Finance Company, CACA No. 24 of 2000 to pray that the $15$ prayer of extension of time is granted and the Applicant's appeal validated. In addition, Article $126(2)(c)$ of the Constitution enjoins Courts to administer substantive justice without undue regard to technicalities. Further, rule 2(2) of the Court of Appeal rules gives the court powers to extend time accordingly. - Finally, counsel for the Applicant submitted that the grant of extension of time $20$ to lodge an appeal would not require the Applicant to file any additional documents, but would validate those already on court record, pursuant to the decision in The Executrix of the Estate of the Late Christine Mary N Tebajjukira and another v Noel Grace Shalita, SCCA No. 8 of 1988.

#### 25 6. Submissions by the Respondents

On the other hand, counsel for the Respondent submitted that the record of proceedings at the High Court (on Pg. 15) shows clearly that the Respondents closed their case on $2/12/2015$ in the presence and participation of the Applicant. The suit was adjourned to $13/12/2016$ in open court and on which

date neither counsel nor the Applicant appeared. The trial Judge further directed 30 that the Applicant be served with a hearing notice, which was done. However, on the second occasion, the Applicant still did not appear and the court fixed the $\mathcal{R}\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\!\$ Judgment for $25/4/2017$ on which date the same was delivered.

$6000$

The Respondents relied on the Supreme Court decisions of SCCA No. 7 of $\mathsf{S}$ 2010; Dr. Ahmed Kisuule v Greenland Bank (in liquidation), SCCA No. 23 of 1994, GM Combined (U) Ltd v AK Detergents (U) Ltd at Pages 4-7 to aver that the Application is without merit.

In addition, Counsel for the Respondent relied on **Rule 42 (2) of the Judicature**

(Court of Appeal rules) Directions and Rule $6(2)$ (b) of the same. Counsel $10$ further submitted that the hearing notice for 13/12/2016 was duly served and clearly endorsed by the Applicant. Any averment otherwise was a falsehood. Counsel for the Respondent prayed that the application be dismissed with costs and prayed for a certificate of 2 counsel to that effect.

#### 7. Resolution of the Application. 15

$\ddot{\phantom{a}}$

This Court has discretion, for sufficient cause, to enlarge the time in which an appeal may be lodged in this court under rule 5 of the Judicature (Court of Appeal rules) Directions SI 13-10. The rule provides that:

"the court may, for sufficient reason, extend the time limited by these *rules or by any decision of the court or of the High Court for the doing of* 20 any act authorised or required by these rules, whether before or after the doing of the act, and any reference in these rules to any such time shall *be construed as a reference to the time as extended*"

In the case of **Molly Kyalikunda & Others v Engineer Ephraim Turinawe &**

- Another, Supreme Court Civil Application No. 27 of 2010; the Court stated 25 that three questions need to be determined before disposing of an application for enlargement of time. These are: - 1) *whether the applicant has established sufficient reasons for the court to extend the time in which to lodge the Appeal.* - *2) Whether the applicant is guilty of dilatory conduct.* - 3) Whether any injustice will be caused if the application is not granted."

$\overline{7}$ See also: Njagi v Munyiri [1975] EA 179 and Utex Industries Ltd v $\mathsf{S}$ Attorney General SCCA No. 52 of 1995. We shall evaluate the application before us on the above parameters.

whether the applicant has established sufficient reasons for the court to extend the time in which to lodge the Appeal

- Enlargement of time is an exercise of discretion by this Court which ought to be $10$ exercised judiciously on proper analysis of the facts and application of the law to the facts. Discretionary orders are normally issued on a case-by-case basis, and not as a matter of right. Therefore, the Applicant ought to persuade this court through some evidence, upon whose assessment such discretion may be - exercised. Generally, applications for enlargement of time within which to $15$ appeal may not be granted if the delay is inexcusably long or where there is no reasonable justification for such delay.

**Section 66 of the Civil Procedure Act Cap 71, Laws of Uganda confers a right** of appeal from decrees of the High Court to the Court of Appeal. Furthermore,

Section 79 (1) (a) of the Civil Procedure Act provides that every appeal shall 20 be entered within 30 days from the date of decree or the order of the Court, except where it is otherwise specifically provided in any other law.

Rule 76 (2) of the Judicature (Court of Appeal rules) Directions SI 71-10 requires lodgement of a Notice of Appeal within 14 days after the date of the decision against which it is desired to appeal to the Court of Appeal.

What constitutes sufficient reason depends on the circumstances of each case and has been defined to mean "Special circumstances". In the decision of Shanti v Hindocha and Others [1973] EA 207, the court held that:

"the position of an applicant for an extension of time is entirely different" from that of an applicant for leave to appeal. He is concerned with showing sufficient reason (read special circumstances) why he should be

the delay has not been caused or contributed to by dilatory conduct

given more time and the most persuasive reason that he can show is that


his own part but there are other reasons and these are all matters of $degree''(sic)$

In Kananura Kansiime Andrew v Richard Henry Kaijuka, SCC Reference No. 15 of 2006, Justice Opio Aweri (JSC) held that:

"what constitutes sufficient reason is left to the Courts unfettered $10$ discretion. In this context, the court will accept either a reason that prevented the applicant from taking the essential step in time, or other reasons why the intended appeal be allowed to proceed though out of time. For example, an application brought promptly will be considered more sympathetically than one that is brought after unexplained $15$ *inordinate delay*"

Our perception is that the Applicant has a right to apply for enlargement of time to lodge an appeal and such order should be granted unless the applicant is guilty of unexplained and inordinate delay in seeking the indulgence of the

- Court, has not presented a reasonable explanation of the failure to file the notice 20 of appeal within the time prescribed by the rules, and the extension will not be prejudicial to the Respondent. We acknowledge that it is fairly well settled that "sufficient cause" should be given a liberal construction so as to advance substantive justice when there is no inaction, no negligence nor want of *bonafide* reason imputable to the Applicant. Sufficient cause will vary from 25 - case to case.

In this case, the Applicant's sole reason for the delay in instituting the appeal is a mistake of counsel. The applicant alleges that Mr. Kitaka, who was an employee in their legal department, and counsel in personal conduct of this matter did not inform his employers that the court had passed judgment in the matter, nor did he inform them of the hearing date when the matter was to

proceed. It is alleged that the Applicant only found out about the judgment

when they were served with a taxation application arising from the civil suit. In

$\mathcal{L}$ $\mathbf{Q} = \mathbf{Q}$

$\mathsf{S}$

- addition, the Applicant claims that they were never served with written $\mathsf{S}$ submissions by the Applicant prior to the decision. The Applicant further alleges that service was not proper and the averments in the affidavit of service which the court relied on to proceed to determine the matter without their input were false. - The response by the Respondents was to the effect that the Application for leave $10$ ought to have been lodged in the High Court before the Court of Appeal, that the case proceeded inter-parties and therefore there is no need to appeal the same, and that an appeal is not an appropriate avenue in this matter, but rather an application to set aside the judgment of the High Court. They however did - 15 not address specifically the mistake of counsel, although it was contended that service for the hearing date of $2/12/2015$ was duly done. Mistake of counsel as sufficient cause for enlargement of time has been

discussed severally by the Courts. In Ggolooba Godrey v Harriet Kizito, SCCA No. 7 of 2006, the Supreme Court held generally that mistake of counsel 20 should not be visited on a party. There was, in our assessment, an error of counsel Kitaka who abandoned the case and never informed his employers. We find this reason sufficient to account for the delay in lodging the Appeal. In addition, we find that the Applicant was not guilty of dilatory conduct. There is no evidence that the error of counsel can be visited on the litigant, due to a failure to instruct or observe provisions of the law. See Tiberio Okeny and 25

another v The Attorney General and 2 others, Court of Appeal Civil Appeal No. 51 of 2001.

The delay in the present case was for a period of four months. It is further clear to us, from the record and evidence available, that it is true that the Applicant

did not participate in the hearing of the case and did not lodge written 30 submissions on account of the actions of Mr. Kitaka. However, the Applicant acted immediately to lodge the Notice of Appeal which they seek to validate, $\mathcal{A}$ $\mathcal{B}$ $\mathcal{A}$

Be<br>Chan

the memorandum of Appeal, albeit out of time, and this application from the $\mathsf{S}$ date they were served with the taxation notice on $26^th$ July 2017.

In Andrew Bamanya v Shamsherali Zaver, Supreme Court Civil Application No. 70 of 2001; the Supreme Court held that mistakes, faults/ lapses or dilatory conduct of counsel should not be visited on the litigant. The

- Court further held that the other principle governing applications for extension $10$ of time is that the administration of justice requires that disputes should be heard and determined on merit. In the Andrew Bamanya case, the delay constituted two and a half years in filing an application for leave to appeal out of time. The delay was caused by the Applicant's lawyers. In that case, Court - found that it would be a denial of justice considering the case, to shut the $15$ Applicant out of exercising their rights. Court also found that it has inherent powers under its own rules to administer substantive justice.

Furthermore, in Sabiiti Kachope & 3 others v Margaret Kamujje, Supreme Court Civil Application No. 31 of 1997, the Court held that an application for leave to extend time within which to appeal which was filed after two years and

20 five months from the date judgment was passed was, for sufficient cause, extended on account of mistake of counsel.

From the two authorities cited above, enlargement of time was granted by the Courts despite the relatively longer delay in comparison to the present

- application. It is our view that a liberal approach ought to be considered in this 25 matter to ensure that the substantive rights of the parties are not defeated only on the ground of delay. The rules of the court are not meant to destroy the rights of the parties. The object of providing a legal remedy is to repair any damage caused by a legal injury so suffered. Therefore, the delay in preferring an appeal - by the Applicant is condoned on account of absence of evidence of gross 30 negligence, or deliberate inaction once the Applicant found out about the court decision.

*Whether any injustice will be caused if the application is not granted*

$42$ 11


- It is our view, which has been applied by the courts in previous decisions, that $\mathsf{S}$ the interest of justice is best served if disputes are heard on the merits and a conclusive decision weighing the rights of the parties is given. In **National Enterprises Corporation v Mukisa Foods, Court of Appeal Civil Appeal** No. 42 of 1997, this Court held that denying a party a hearing should be the last resort of the Court. We agree with this position. $10$ - In Nanjibhai Prabhudas and Company Ltd v Standard Bank Ltd [1968] **EACA 5,** it was held that: $\mathbf{E}$

"The Court should not treat any incorrect act as a nullity with the consequence that everything founded thereon is a nullity unless the incorrect act is of a most fundamental nature. Matters of procedure are *not normally of a fundamental nature*"

In *Tiberio Okeny & Others v The Attorney General & 2 others (Supra)* it was held that the court is enjoined to consider that the administration of justice normally requires that the substance of all disputes should be investigated and decided on the merits, and errors and lapses should not necessarily debar a

litigant from the pursuit of his rights.

The Supreme Court of Uganda in Re Christine Namatovu Tebajjukira [1992-**93 HCB 85** stated that:

"*The administration of justice should normally require that the substance*" of disputes should be investigated and decided on their merits and errors and lapses should not necessarily debar a litigant from the pursuit of his rights"

We are further persuaded by the Kenyan Court of Appeal's reasoning in **Phillip** Kiepto Cemwolo & Another v Augustine Kubende [1986] KLR 495, wherein the Court held that:

"Blunders will continue to be made from time to time and it does not follow that because a mistake has been made a party should suffer the penalty of not having his case determined on its merits"

$\mathsf{BA}$

$15$

In this case, the Applicant delayed to lodge the Notice of Appeal and has $\mathsf{S}$ advanced the reason discussed above. We are persuaded in the circumstances of this case that the interest of justice would best be served by granting the application. The Respondent, in our view is not prejudiced by the appeal, although lodged out of time, being heard on the merits.

*Whether the applicant is guilty of dilatory conduct* $10$ We have not observed any evidence in the affidavit in reply lodged by the Respondents which suggests that the Applicant is guilty of dilatory conduct, either through failing to instruct or through inordinate delay.. In addition, at the date of hearing this application, the intended Appeal (Civil Appeal No. 20 of

- 2018) was duly lodged and was called for hearing. $15$ Therefore, having found that this court has discretion to enlarge time in order to safeguard the Applicant's right of appeal, it would be in the interest of justice to allow the application. This court therefore grants the orders sought and validates the Applicant's appeal. - The costs of this Application shall abide the outcome of the appeal. $20$

Dated at Kampala this .................................... RICHARD BUTEERA, DCJ 25 **CATHERINE BAMUGEMEREIRE, JA** 30 .<br>. . . . . . . . . . . . . . . . . . .

## **CHRISTOPHER GASHIRABAKE JA**

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