[2022] UGSC 37

# ⁵ THE REPUBLIC OF UGANDA IN THE SUPRTME COURT OF UGANDA AT KAMPALA CIVIL APPLICATION NO. 52 OF 2O2I

## (Arising out of Court of Appeal Civil Appeal No. 15 of 2()13)

## ¹⁰ (Arising out of Supreme Court Civil Appeal No. 13 of 2()15)

#### BETWEEN

### UGANDA TAXI OPERATORS &

DRTVERS ASSOCIATION (UTODA) APPLICANT

#### AND

## ¹⁵ UGANDA RTVENUE AUTHORITY (URA| : : : : : : : : : : : : : : : : : RTSPONDENT

## RUTING OF MIKE J. CHIB

This is an application brought by Notice of Motion under Article 126 and 132 (1) & (2) Rutes 2(2), 5,42,43,72 &' 43 of the Judicature (Supreme Court Rules) Directions, seeking the following reliefs:

(a) An order extending the time within which to appeal against part of the judgment and orders in Court of Appeal, Civil Appeal No. 15 of 2013 be granted.

(b)An order to file the appeal from part judgment and orders in Court of Appeal, Civil appeal No. 15 of 2013, out of time be granted

(c) Costs of this application.

#### Background

The Applicant, Uganda Taxi Operators and Drivers Association (UTODA) a company limited by guarantee sued the respondent for refund of monies retained by the appellant as Value Added Tax (VAT) since 20O1 in respect of the appellant's taxi parks operations which the appellant company carried out at the material time for and on behalf of the then Kampala City Council (KCC) now Kampala Capital City Authority. By 20 10, the respondent had retained from the appellant Ug. Shs 3,903,136,565/= as Value Added Tax. In the High Court, the issue for determination was "whether the applicant was liable to pay VAT for its services of management of taxi parks and Taxi Operators in Kampala City." The High Court answered in the affirmative. Being dissatished with the decision of the High Court, the applicant appealed to the Court of Appeal vide Civit Appeal No. 15 of 2013. The Court of Appeal allowed the appeal, set aside the decision of the High Court and ordered that a\_11 the VAT amounting to 3,93,136,565/= collected from the applicant be refunded. Court further ordered that the above amount shall carry interest at the rate of 2o/o per month compounded from the time it was paid until the date of this judgment. That thereafter, the decretal amount shall carry interest at the rate of lOo/op.a from the date hereof till payment in full. 10 15 20 25

Uganda Revenue Authority being dissatisfied with the decision of the Court of Appeal appealed the decision to the Supreme Court vide Civil

- Appeal No. 13 of 20 15. This court upheld the judgment and orders of the Court of Appeal in its entirety. A decree of the court was extracted in order to commence execution of the said order. However, while computing the amount payable by the respondent, there arose a dispute between the parties regarding the interest awarded. - The applicant argued that the compound interest at the rale of 2o/o should run from the time it was paid till the whole alnount is paid in full. The respondent on the other hand argued that the court ordered that the interest of 27o should run from the time of payment till the date of judgment and thereafter the decretal sum should carry interest of 10% p.a from the date hereof till payment in full. 10 15

The Applicant filed to the Court of Appeal an application vide Miscellaneous Application No. 152 of 2017, Uganda Taxi Operators & Drivers Association vs. Uganda Revenue Authority under Rule 36 of the rules of the Court of Appeal. The appellant sought court to correct its judgment in Civil Appeal No. 15 of 2O13 in respect to the mistake/ error arising out of an accidental slip or omission with regard to the issue of payment of interest on the decretal sum. The Court of Appeal dismissed the application by a majority decision of 2 to 1. 20

The applicant being dissatisfied with the decision of the Court of Appeal, then lodged this appeal before Court challenging the decision of the Court of Appeal. This Court dismissed the appeal with costs and confirmed the decision of the Court of Appeal. 25

⁵ The Applicant then preferred another application for correction of the said errors vide SCCA No. 24 of 2Ol9 which was also dismissed'

### Representation

Stephen Bazanye, on behalf of the applicant swore an affidavit in support of the Notice of Motion. For the respondent, Gloria Akatuhurira swore an affidavit in reply.

At the hearing, Stephen Bazanye, Finance Manager of the applicant, was in court represented by learned Counsel Joseph Kyazze ' The respondent on the other hand was represented by learned counsel George Okello.

- Learned Counsel for the respondents raised a preliminary point of law at the outset. He referred court to Order 6 rule 28 and Hwan Sung Ltd vs. M&D Timber Merchants and TransPorters Ltd, SCCA No. 02 of 20 18, regarding regulation of raising preliminary points of 1aw. 15 - He stated that the preliminary point rested on only one ground, to wit, that court lacks jurisdiction to entertain an application for leave to appeal to this court in the instant case. 20

He cited Article 132 of the constitution, which provides that the Supreme Court is the final court of appeal under clause 1' Under

clause 2 it provides that the Supreme court entertains appeals from decisions of the Court of Appeat. He added that the same provisions are found in the Judicature Act. 25

- ⁵ He pointed out that the application sought to enlarge the time to purportedty appeal a decision of the Court of Appeal No. 15 of 20 13, which was already appealed and upheld in SCCA No. 13 of 20 15. Therefore, he added, the decision sought to be appealed against is a decision of the Supreme Court not that of the Court of Appeal. - Learned Counsel also referred court to DFCU Bank Ltd vs. Donna Kamuli SCCA No. 29 of 2019, where court emphasized that the decisions of the Supreme Court were hnal. 10

He also referred Court to three previous applications of this court, namely, CA Misc. Appl. No.752 of 2017, SCCA No. 07 of 2018, SCCA No. 24 of2O19.

He prayed that the preliminary objection is upheld, the application dismissed and costs awarded to the respondents.

Learned Counsel for the applicants sought for an adjournment to enable him make a researched response. He submitted a written response thereafter in which he contended that the preliminary objection was devoid of legal and factual merit.

He submitted that the application is seeking orders granting extension of time within which to appeal against part of the decision of the Court of Appeal in Civil Appeal No. 1 5 of 20 1 3 .

The part to be appealed against, he continued, was whether the rate of interest awarded by the Court of Appeal was inconsistent with mandatory provisions of the VAT Act. 25

⁵ Learned Counsel agreed with the appellate powers of the Supreme Court as provided for by the Constitution in Article 132 and the Judicature Act, section 6. He referred court to Geoffrey Komakech vs Rose Akol & Others SCCA No. 21 of2O1O.

He however, sought to distinguish the case of DFCU Bank Ltd vs.

Donna Kamuli (supra) as having specifically being about appeals from the Industrial Court. 10

He further submitted that the court of Appeal neither considered nor awarded the interest specified in the High Court order, which, he pointed out, amounted to an illega-tity.

- He referred court to Geoffrey Komakech and Makula International Ltd vs. His Eminence Cardinal Nsubuga and Anor (1982) HCB, ¹¹ (Court of Appeal Civit Appeat No. 4 of 1981) in support of his assertion that an illegality had been committed and ought not to be overlooked by this Court. 15 - On the issue of the SCCA No. 13 of 2015 having already disposed of the appeal, Counsel contended that the appellant in that particular case was URA and not UTODA. He added that the sole ground of appeal did not address the issue that this application seeks extension of time to appeal against. 20 - On failure to raise the issue as a cross appeal in URA vs. UTODA SCCA No. 13 of 2015, learned counsel contended that failure to file a cross appeal is no bar to the aggrieved party filing a subsequent appeal. 25

⁵ He further submitted that execution of a decree is no bar to proceedings chaltenging the illegality of a decree. In support of this assertion, he cited Francis Makumbi vs. NIC (1979) HCB 230 and Henry l(awalya vs Kinyankwanzi (19751 HCB 372.

He finally submitted that the Court of Appeal and the Supreme Court had acknowledged the illegality but had faulted the applicant for using the w'rong procedure, hence the present application.

He prayed that the preliminary objection is overruled, the application heard on its merits and costs awarded to the applicants.

### CONSIDERATION BY COURT.

I have had the benefit of considering the submissions of both counsel. 15

The application before me is for an order extending the time within which to appeal against part of the judgment and orders in the Court of Appeal, Civil Appeal No. 15 of 2013, an order to file the appeal from part of that judgment and orders in Court of Appeal out of time and costs of this application.

I wish to deal with the competence of this application first.

Counsel for the respondent rightly pointed out that the jurisdictional foundation of the Supreme Court is found in Article 132 of the Constitution.

Article 132 provides for the jurisdiction of the Supreme Court. It provides as follows: 25

## 732. Jurisdictlon of the Supreme Court

## ⁵ (l)The Supreme Couti sholl be tlnol court of appeal

# (2lAn appeal shall lle to the Supreme Court from such decisions oJ the Court of Appeal as nag be prescrlbed. by lo,ut.

10 This position is reiterated in section 6 of the Judicature Act which reads as follows:

## 6. Appeals to the Supreme Court ln ctvll matters

(1) An appeal shall lie as of rtght to the Supreme Court uhere the Coutt of Appeal conJirm.s, uaries or reuerses a jud.gment or ord.er, lncluding an interlocutory order, gluen bg the Htgh Coutt in the exerclse of its ortginal jurtsdtctlon qnd elther confirmed, aarled or reuersed bg the Court of Appeal.

The aforesaid provisions of the law presuppose a decision of the Court ofAppeal that has not been appealed against by any parties.

Rule 5 of the Judicature (Supreme Court Rules) Directions, upon which the applicant seeks to rely incorporates this jurisdictional foundation. The rule states as follows: 20

### 5. Extenslon of tlme

The court mag, for sufficlent reasott, extend the time prescribed ²⁵ these Rules or aft decision o the court, or o the Coutt o Appeal for the doinq of anu act authorl.sed or reouired bu these Rules, whether betore or afier the explratlon of that time qnd whether before or afr,er the dolng of the o,ct; and ang reference ## ⁵ ln these Rules to ang such tlme sholl be constnted as a reference to the tlme as so ertended.

The extension of time sought must be for an act authorizcd or required by the rules.

In the instant facts, an appeal against the decision of the Court of Appea-l in UTODA vs. URA, CACA No. 15 of 20 13 was lodged in this Court vide URA vs. UTODA, SCCA No. 13 of 2O 15 by the respondent. The appeal was heard and dismissed. This resulted in the confirmation of the decision of the Court of Appeal by this Court in its entirety. Therefore, what was initially a decision of the Court of Appeal became the decision of the Supreme Court which is the final 10 15

Court of the land. The applicant exhausted all the appeals available to it in law.

Having determined that there is no longer a decision of the Court of Appeal to be appealed against, I am inclined to find that the application for extension of time within which to file an appeal is incompetent and ought to be struck out.

Be that as it may, the applicant's answer to the preliminary objection makes an allegation that part of the decision of the Supreme Court is illegal and that this would justify the intervention of court in order

to rectify the illegality. He relied on Makula International Ltd vs. His Eminence Cardinal Nsubuga and Anor, 1982 HCB 11 and Beatrice Kobusingye vs. Fiona Nyakana, SCCA No. S of 2OO4. 25

- The two principles striving for reconciliation in this preliminary $\mathsf{S}$ objection are **jurisdiction vs. illegality**. The finality of this Court's decision on one hand vs. the duty of court to correct an illegality. Can the court overlook issues of jurisdiction in order to correct an illegality? If so, under what circumstances? Are issues of jurisdiction - so fundamental that not even an illegality will override their 10 importance? I will explore illegality in detail before making the final decision.

The term "**Illegality**" has been defined by this Court in the case of Hilda Wilson Namusoke & Anor vs. Owalla's Home Investment Trust (E. A) & Anor. SCCA No. 15 of 2017, Prof. Tibatemwa -

- Ekirikubinza, JSC in her lead judgment adopted the Black's Law **Dictionary,** 9th Edition @ 185, definition of the term "Illegality" - $(i)$ An act that is not authorized by law.

- $(ii)$ The state of not being legally authorized. - (iii) The state or condition of being unlawful 20

This court's decision in the case of **Attorney General vs. Bumero Estates Limited, SCCA No. 25 of 2019, provides yet another** definition of the term "illegality."

In that case, Opio-Aweri, JSC, adopted the definition of illegality in the case of Nilefos Minerals Ltd vs. Attorney General & Anor (Misc. Cause No. 0184 of 2014) as follows;

"Illegality is when the decision making authority commits an error of law in the process of taking or making the act subject

of the complalnt, Actlno utithout lurisdlctlon or ultra uires or contrary to the proulslons of a lau or lts prlnclples are instances of lllegatitu." (Emphasis mine)

The duty of court in the face of illegality has been discussed in numerous decisions of this court.

¹⁰ The locus classicus on the issue of illegality is the case of Makula International Ltd vs. His Eminence Cardinal Nsubuga & Anor (supra). The Court laid down the standard that even where an appeal is incompetent but the court discovers an illegality in the proceedings from which the appeal emanates, the court can interfere with the decision. Itlegality overrides all questions of pleadings, including 15

admissions thereon.

The court stated, inter alia, as follows:

20 "The court could. lntertere uttth the taxlng officer desplte the fact that the oppeal utas incompetent. a court of laut cannot sanctlon uthqt ls lllegal and lllegalltg once brought to the attentlon of coura oaerrldes o'll questlons of pleadlng, lncludlng admissions thereon. An qutard oyfl shs. 7'9OO,OOO/= lnstntctlon fees utc,s manlfestlg excesslae qnd contrary to the laut omountlng to an inJustlce to the appellant and an abuse of cour-t, process. " (Emphasis Mine). 25

This position was applied in the case of Beatrice Kobusingye vs. Fiona Nyakana, SCCA No.5 of2OO4.

In that case, the Court of Appeal had erroneously granted the $\mathsf{S}$ applicant a certificate of importance to appeal against its orders in an interlocutory matter contrary to the provisions of section $6$ (2) of the Judicature Act.

The court held, *inter alia*, as follows:

"This obviously means that this "appeal" has 10 $no$ jurisdictional foundation. As we recently stated in the case of Uganda National Examinations Boards' Vs Mpora General Contractors, (Civil Application No.19 of 2004). there is no right of appeal to this Court originating from interlocutory orders of the Court of Appeal which orders 15 are incidental to the appeal but not resulting from the final determination of the appeal itself. Here the Court of Appeal has not determined the appeal yet. It follows that the Court of Appeal erred in giving the certificate for the appellant to lodge this appeal. This Court noticed this 20 anomaly when the so called appeal was pending judgment. Normally we would have asked parties to address us before making a final decision. However, in view of the clear provisions of sub sec. (2) (supra), and of our recent decision in the UNEB case (supra), it is unnecessary to hear parties 25 on it. This appeal is therefore incompetent and ought to be struck out."

> "However, because an illegality (namely the view held by the Court of Appeal to the effect that old section 74 and

- 75 of the Ctall Proced.ure Act do not appla to that court) has been drawn to our qttentlon ue have to correct that it See Mukula Intentational Vs H. E, Cardlnal Nsubuqa 17982] HCB 77.'lslc) (Emphasis mine). Also see IVSSI. as. Alcon SCCA llo. 15 of 2OO9. - 10 15 A recent application of this provision was in the case of Otim vs. Uganda, SCCA No. 14 of 2O18. In that case, Otim Moses the applicant was charged, tried, convicted and sentenced to death for the offence of murder and aggravated robbery. His death sentence was confirmed by this Court. An application for review was brought, for, among other orders, a declaration that the Supreme Court omitted to consider admissible evidence relating to the applicant's age. The issue for determination was whether the applicant was under ¹⁸ years at the time of commission of the alleged offence and whether the omission occasioned a miscarriage of justice. - 20 This court after examining the evidence regarding the applicant's age determined that the he was 17 years at the time of commission of the offence. This therefore meant that the death sentence had been unlawfully imposed on the applicant contrary to the express provisions of section 9a(1) (g) and section 104 (1 &2) of the Children's - 25 Act that bar a death sentence of a child. The court set aside the death sentence and ordered for his release because he had been in prison for more than 10 years.

The Court while coming to this decision laid down the considerations $\mathsf{S}$ that necessitate the invocation of the powers of the court under rule 2(2) of the Court's Rules. It stated, *inter alia*, as follows:

"The powers of the Supreme Court, as a final Court of Appeal, to review its own decisions have been extensively dealt with in a number of cases both from within and outside Uganda as will be shown in this judgment. We have found it pertinent to lay down the parameters under which the inherent power and discretion may be exercised by the Supreme Court.

As noted earlier, the position of the law is that a party is 15 not entitled to seek review of a judgment of the Supreme Court merely for the purpose of rehearing so as to seek $a$ fresh decision of the case. This would tantamount to an appeal. In principle, a judgment pronounced by this court is final and departure from this principle is justified upon 20 circumstances of a substantial and compelling character being established to the Court's satisfaction. **Such** circumstances may include where:

> $(a)$ Clearly a wrong has been done and it is necessary to pass an order to correct it in the interests of justice.

The decision embedded in the judgment has been $(b)$ proved to be null and void in law; that is, it particularly violates provisions of the law

$10$

Under rule 35, known as the slip rule where some $(c)$ arithmetical or obvious mistake is clear on the record.

## It is shown that enforcement of the decision will $(d)$ amount to an abuse of due process" (Emphasis Mine)

From the foregoing, this Court has the power to correct an illegality even where the proceedings have no jurisdictional foundation.

According to counsel for the applicant the matter was brought to the attention of a full panel but it was not dealt with. Now the matter is before a single justice of the Supreme Court to determine what the full panel declined to grant.

The powers of a single justice of the Supreme Court are prescribed 15 under section 8 of the Judicature Act. It states as follows:

## 8. Powers of a single justice of the Supreme Court

(1) A single justice of the Supreme Court may exercise any power vested in the Supreme Court in any interlocutory cause or *matter before the Supreme Court.* (Emphasis mine)

The term "interlocutory" is defined by **Black's Law Dictionary**, 6th Edition, Centennial Edition (1891-1991) @ 815 to mean:

"Something intervening between the commencement and the end of a suit which decides some point or matter but is not a final decision of the whole controversy."

$\mathsf{S}$

$10$

A single justice does not have jurisdiction to overturn a decision of a full panel. This in itself would tantamount to an illegality and abuse

- of court process because it would be contrary to section 8 of the $\mathsf{S}$ Judicature Act. It would cause confusion and create procedural mayhem of grand proportions. It would open up the legal process to endless litigation and continuous appeals, reviews and all sorts of applications. - While reiterating the Court's commitment to the ratio in **Makula** $10$ **International** (supra), that an illegality once brought to the attention of court supersedes all questions of pleadings, I am also cautious not to cause another illegality that would result from acting without authority or jurisdiction in as far as a single justice versus a full panel - is concerned. Only a panel of five justices would have the jurisdiction 15 to correct that illegality.

It is for the foregoing reasons, that I decline to grant the application. The application is consequently dismissed with costs to the respondents.

$t$ Dated at Kampala this .................................... $.2022$

Min Chilite

Mike J. Chibita

## JUSTICE OF THE SUPREME COURT

Rubins delivered in presence of<br>George Okello - Respondents<br>Frelyn Tummherwe - Applicante Staphen Bazanye-Finance Manager, OTODA $17/3/22$

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