Abdalla Faraj v Odimbe and company Advocates (Civil Suit No. 962 of 1986) [1998] UGHC 38 (27 August 1998)

$RR-$

THE REFUBLIC OF UGANDA IN THE HIGH COURT OF UGANDA AT KAMPALA CIVIL SUIT NO. 962 OF 1986

| ABDALLA FARAJ | | $\cdots \qquad \qquad \cdots \qquad \qquad \cdots$ | | PLAINTIFF | |-----------------------------|----------------------------------------------------------------|----------------------------------------------------|--------------------|--------------------------------| | | | | $\mathcal{S}^{''}$ | | | | -versus- | OMAR | | $\mathcal{L} \cup \mathcal{L}$ | | R. A. CDIMBE & CO. ADVOCATES | | | 12002 | <b>DEFENDANTS</b> | | | | | | | | | BEFORE: - HON. THE PRINCIPAL JUDGE - MR. JUSTICE J. H. NTABGOBA | | | | | | | | | | | | | | | |

Abdulla Faraj who is the plaintiff in this case and one Mohamed Suleman (now deceased) owned jointly a business in partnership with one Abdul Majid who is said to have fled with the Amin's Soldiers in the 1979 Liberation War: The partnership business is called NEW ELGON CINEMA situated at Plot 10/12 Naboa Road, Mbale. The two gentlemen, Abdall Faraj and Mohamed Suleman who were illiterate had been running the business without Abdul Majid since he fled the Country and until the cause of action in this case is alleged to have commenced. i.e. when an agreement is purported to have been signed by the plaintiff transfering his share to the first defendant, Ali Omar with the assistance of the second defendant, Richard A. O. Odimbe, Advocate.

The facts which form the background of the case are that the plaintiff, Abdalla Faraj, is alleged to have, by a written Agreement (Annexture ' $\Lambda$ ' to the plaint) transferred his shares in the New Elgon Cinema to the first defendant, the said Ali Omar in this suit, in consideration of a sum of Shs. 2,500,000/-

> FEE PALASIDS $\sim$ ... $\mathcal{S}^{0.16}$

(Two and half Million Shillings) paid by the said Ali Omar to the plaintiff. I will hereafter refer to Ali Omar as the first defendant. The alleged agreement was prepared by the law firm of Odimbe & Company Advocates whose sole partner is Mr. Richard A. O. Odimbe, now the second defendant who witnessed the signatures of the two illiterate partners (i.e. The plaintiff and Suleman Mohammed) as well as the signature of the first defendant.

According to the plaintiff, it is not true that he transferred his shares to the first defendant. As far as he is concerned, he borrowed from the first defendant the sum of shillings (shs.2,500,000/ $=$ ) to be paid back by instalments. It is not disputed that the first defendant paid the money to the plaintiff by instalments starting with a sum of shs. $1,500,000/$ = (One and half million shillings). The plaintiff alleges that when he was made to sign the agreement. (Annex A of the plaint) he knew he was signing a loan agreement to secure the sum lent to him by the first defendant. The plaintiff therefore categorically denies ever entering into an agreement (Annex A of the plaint) to transfer his shares.

As I have pointed out the other alleged signatory to the alleged agreement was Mohamed Suleman who, as I have said, was, like the plaintiff, an illiterate and who died before this suit was instituted.

vie have not been privi. Iaged therefore to geb his testimony whether to know /\_ it is true 116r was party bo the alleged agreemenb. This rnakes the matter more cornplJ-cated in vj.ew oI' the fact that the plaj-nti-Cf says thaL he never saw the signing of the agreement by Lhe parties i.ndj"cated as having signed i L. Ile says he was called to the Cltambers oI 14,/S. 0dimbe & Co. Advocabes arrd was asked to s1gn a document which, he was made to understandt was a loan agreement. He states that he was told thab Moharned Suleman and the first defendant would also sign and bhab iL was afber their slgnigu3s tlrat he was promised he would be given a copy of tbe loan agreement. IIe says, and he was not opposed, that after receiving the firsb loan insbalment, he Lefb for his home, L,umino, because he was taking Leave to aLtencl to his sick fanily member. He reburned to Mbale twice to collect from the first defendanb bhe resL of tiie loan instalments.

n

I

a )

ii o

> 'IIte defendanbs, on Lhei-r part bestified, and they wene supported by one Hussen l{achi, Chief Clerk to the second defendant, that actually Lire plaintiff had been lrantically Looking .for 6ome one to tru.y his shares because he wanted to abandon the Cinema business and go into fishing. The defence alleges that in his quest for a buyer pf his shares, he had wanted to sell bhem Lo a Mr. I,langwal.a who was a governmenb Mini ster.

> > 4

The defendants allege that the plaintiff was desuaded from selling the shares but he refused to heed the advice, thereby eventually settling at selling the shares to the first defendant. Thereupon then the firm of the second defendant prepared, at his request, the contested agreement.

$\overline{\phantom{a}}$

When his leave expired, the plaintiff alleges, he came back to Mbale to resume his participation in the business. It is then thathe was given the copy of the contested agreement being told that he nolonger had any stake in the business. Hence the institution of this suit in which he prays for quite a number of remedies namely,

- (a) a declaration that the document Annexture "A" $\alpha$ (of the plaint) is not the instrument the plaintiff agreed on 13th May, 1985 to execute. - (b) a declaration that the said document contravenes the provisions of the Illiterates Protection Act, Cap. 73 of the Laws of Uganda. - (c) a declaration that the said document is riddled throughout by deceit and fraudulent misrepresentation. - (d) an order for delivery and cancellation of the original of the said document and all its copies and/or counterparts. - (e) general damages against both defendants jointly and severally for fraud and deceit. - (f) against the first defendant for damages in trespass. - (g) against the first defendant for loss of earnings of Shs. $4,800,000/$ = "to date".

- (h) against the first defendant for repossession of the Cinematograph and in default, payment of Shs. 200,000,000/=. - (i) Against the first defendant for loss of earnings at shs. $300,000/$ = monthly "from filing hereof till repossession of the Cinematograph.

$-92 -$

- (j) Against the first defendant for a perpetual injunction to restrain him from further similar act of trespass. - (k) Interest on (e), (f), (h) in default, and (i) at 30%p.a. from filing till payment in full. - (L) Costs of and incidental to these proceedings. - (m) Such further or other relief as may appear to this Court just in the premises.

The defendants contend that the plaintiff, when he signed the agreement being contested, knew he was signing an agreement to transfer, his shares in the partnership; that Mr. Odimbe, defendant: the second/explained the contents of the agreement to the plaintiff in the language he understood and that he understood that the agreement was transferring the plaintiff's shares; that therefore it cannot be true what the plaintiff alleges that he only knew that he was signing a loan agreement.

At the commencement of the hearing presided over by the late Justice W. K. M. Kityo, the following 6 issues were framed and agreed:-

- 1. Whether the agreement, Annexture 'A' to the plaint is correct by S.4 of the Protection of Illiterates Protection Act. - 2. Whether the plaintiff is estopped from challenging the validity of the agreement - Annexture A to the plaint.

$.6$

$\label{eq:1} \mathcal{L} = \mathcal{L} + \mathcal{L} = \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal{L} + \mathcal$

- $-13 -$ - 3. Whether there was fraudulent misrepresentation and deceipt. - 4. Whether parties were in paridelicto when Annexture A was executed. - 5. Whether the plaintiff is a member of that class of persons protected by the Illiterates Protection Act. - 6. Whether the plaintiff is entitled to rescind the contract contained in Annexture 'A' of the plaint.

I propose to deal with the issues as framed and, in so doing, I will start with issue number one, namely, whether the agreement offends against S. 4 of the Illiterate Protection Act and if so whether it is illegal. I will first quote S.3 of the Act:-

" No person shall write the name of an illiterate by way of signature to any document unless such illiterate shall have first appended his mark thereto; and every person who so writes the name of the illiterate shall also write on the document his own true and full name and address as witness, and his so doing shall imply a statement that he wrote the name of the illiterate by way of signature after the illiterate had appended his mark, and that he was instructed so to write by the illiterate, and that prior to the illiterate; appending his mark the document was read over and explained to the illiterate".

This section does not apply to the agreement (Annex A of the plaint) except so far as to emphasises what are the duties of the person who witnesses the appending by an illiterate of his mark on a document.

Section 4 of the Act appears to be the relevant provision with regard to this case. It provides that:-

$-14$

" 4. Any person who shall write any document for or at the request, on behalf or in the name of any illiterate shall also write on such document his own true and full name as the writer therefor and his true and full address, and his so doing shall imply a statement that he was instructed to write such document by the person for whom it purports to have been written, and that it fully and correctly represents his instructions and was read over and explained to him".

It has been argued on the part of the defendants that Mr. Odimbe, the second defendant did explain the contents of the agreement (Annexture A of the plaint) in the language of the plaintiff and that he (the plaintiff) did understand the document. At one stage a suggestion was made that because Mr. Odimbe witnessed the signatures (scribbles) of the two partners, including the plaintiffs, that satisfied the reguirements of S. 4 of the Illiterate's Protection Act. I should point out that neither the information in the left hand corner of the last page of the document, to wit, "Drawn by M/S. Odimbe & Co. Advocates, Plot No. 25 Obote Avenue, P. O. Box 935, Mbale", nor the signature of Mr. Odimbe as witness to the signature (scribble) of the plaintiff on the document, can be said to satisfy the requirements of S. 4 of the Illiterates Protection Act.

..8

I mean here that where the illiterate asserts that he did not know the contents of a document to which/is alleged to have appended a signature, and the opposing party claims that he the explained the contents of the document to/illiterate, the Courts will insist that the only assurance that such explanation was made is the certificate provided for in S. 4 of the Illiterates Proctection Act. In the absence of such a certificate, therefore, I have to answer the first issue

that the document (Annexture A of the plaint) did not comply with the provisions of $S.$ 4 of the Illiterates Protection Act; the document is illegal and, in this regard, without belabouring the point, I would say that the plaintiff is entitled not to be bound by the contents of the document.

I will pass on to the issue whether the plaintiff is estopped from challenging the agreement. It has been argued by the defendants' advocate that the basic principle to be considered is that "when a person puts his signature on a document or a contract", he is presumed to have read it and understood it and is thereby bound by its contents. That may as well be so, but certainly not in a situation where the person so signing is an illiterate who is incapable of reading the document or contract. And in this case it is not disputed that the plaintiff is and was illiterate when he signed the document.

$10$

This brings me to issue number 4 (reached by skipping issue number 3). Issue number 4 is whether the plaintiff and the defendants were in pari delicto when they signed the agreement. I have not been able to find that the parties were in pari delicto. In the first place, I would be contradicting myself to state in the same judgment that the plaintiff did not understand the contents of the agreement and at the sametime that he was in pari delicto with the defendants when they signed the agreement, for to be in pari delicto, the parties must have understood that they were committing the offence. I confess I am unable to find categorically that any parties intended to commit an offence. I cannot say, on of the / the evidence and the circumstances of this case, that the defendants were intent on defrauding the plaintiff even though that could as well have been their intention. I tend to think that, in ignorance of the provisions of the Illiterates Protection Act, the second defendant was in the habit of illiterate letting his/clients sign important documents without explaining their contents to those clients. I say this because it appears that even the same mistake was made when the firm of the second defendant made the illiterates sign a partnership agreement on the 14th Jay of January 1982 in which the plaintiff was entering a partnership with Muhamed Suleman and Ali Omar. The errors made with regard to the agreement (Annexture A of the plaint) appear to be a repetition of the errors made with regard to the accement (partnership deed) of 14th January, 1982. Ny answer to the 4th issue therefore is that the parties were never at all in pari delicto. And in view of what I have said, I am unable to find either that the defendants were guilty/ of any fraud or deceift. Incidentally, I have not been able to $\frac{1}{2}$ find in the plaint that the defendants committed any fraud or deceit as anyone who alleges fraud or deceit must give particulars. (See order 6 rule 5 of the Civil Procedure Rules).

I now turn to issue number 5, whether the plaintiff falls under the category of persons protected in the Act. As I have said, the plaintiff is an illiterate. The Act is one of those $A$ cts which are specifically enacted to protect a category of persons against the operation of another category, usually the more powerful and more privilleged. I have also already stated that an illiterate person is a person susceptible to being misled into subscribing to contracts and other documents the contents of which they do not know or understand. I have already categorised the plaintiff as a person intended to be protected by the Illiterates Protection Act, Cap. 73 of the Laws of Uganda.

Reference to a number of decided cases will probably hammer home what I have just said. The authorities include the case of THE KIRIRI COTTON COMPANY LTD. -vs- RANCHODDAS KESHAVJI DEWANI 79587 E. A. 239. (See page 247).

$-\frac{G}{12}$

In that case a number of other cases were discussed by Sir Keneth O' Connor, P). They included Browning -vs-Morris (1778) 2 Cap. 790 in which Lord Mansfield said:-

" But where contracts or transactions are prohibited by positive statutes, for the sake of protecting one set of men from another set of men; the one, from their situation and condition, being liable to be oppressed or imposed upon the other; there, the parties are not in pari delicto; and in furtherance of the statutes, the person injured, after the transaction is finished and completed, may bring his action and defeat the contract".

We then go to the words of Sir Keneth O' Conner P at p. 247 of Kiriri Cotton Co. -vs- R. K. Dewani (supra) that:-

" What is done incontravention of an Act of Parliament cannot be made the subject matter of an action as the rule which in the absence of such a statutory right must apply to the giver of an illegal premium. But that rule is subject to several exceptions: for instrance where the parties are not in paridelicto, or where the contract is made illegal by statute with the object of protecting a particular class of persons to which the plaintiff belongs". (underlining supplied by me for emphasis).

In the case of Kearley -vs- Thomason (1890), 24 QBD. 742 (cA) Lord Justice Fry, at p. 745, having quoted the general rule, said that:-

" You shall not have a right of action when you go into a Court of justice in this unclea $\pmb{\eta}$ manner to recover it back", and then said:-

" To that general rule there are undoubtedly several exceptions or apparent exceptions. One of those is the case of the oppressor and oppressed, in which case usually the oppressed party may receiver the money back from the oppressor. In that class of cases delictum is not par, and therefore the maxim does not apply. Again, there are other illegalities, which arise when a statute has intended to protect a class of persons, and the person seeking to recover is a member of the protected class".

$100$

$13$

What conclusions then can we make out of the facts of the instant case? The answers are now laid bare: The plaintiff did not understand the contested agreement. The agreement is illegal because it is outlawed by the Illiterates Protection Act, in the circumstances of this case where the agreement does not conform to the requirements of S. 4 of the Act. There was neither fraud nor deceit and neither were the parties in pari delicto. Where the parties are not in pari delicto or where an agreement or document is made illegal by a positive statute, then the party for whose protection the statute was intended has the right to obtain an order of the Court nullifying the agreement or document. That was the decision in Kiriri Cotton Co. -vs- R. K. Dewani (Supra), and also in the earlier English cases of Browning -vs- Morris (Supra) and Kearley -vs-Thomson (Supra). For further emphasis, it is pertinent to reiterate by quoting from the words of Lord Mansfield in Browning -vs- Morris (Supra) again:-

"Where contracts or transactions are prohibited by positive statutes, for the sake of protecting one set of men from another set of men; the one from their situation and condition being liable to be oppressed or imposed upon by the other; there, the parties are not in pari delicto; and in furtherance of these statutes, the person injured, after the transaction is finished and completed, may bring his action and defeat the contract".

$-14$

This quotation summarises almost the answers to the issues framed and agreed. Consequently I do hold that the document (contract - Annexture 'A' of the plaint) is $\frac{null}{2}$ and void, not binding on the plaintiff. I accordingly declare that there was no contract of sale of the shares of the plaintiff to of shares in the first defendant $\angle$ the New Elgon Cinema. This is because the document contravenes the provisions of S. 4 of the Illiterates Protection Act. I am unable to hold, however, that the so called contract was or is riddled with fraud and deceit as prayed in one of the prayers in the plaint nor have I been able to decide that there any misrepresentation in the document on the part of any of the defendants' if such misrepresentation would imply culpable misrepresentation. What I can hazard is a conclusion that the second defendant and his firm of advocates seem to have been in the habit of drafting documents which contravened the provisions of the Illiterates Protection Act, Cap. 73 of the Laws of Uganda in the ignorance of the error and its legal implications.

This is exemplified not only in the document under discussion but also in the partnership deed drafted by the second defendant's firm among the three aforementioned men, namely, the plaintiff, Mohamed Suleman and Abdul Majid. Here I am refering to the DEED of Fertnership made the 14th day of January 1982 BETWEEN Abdalla Faraj, Mohamed Suleman and Ali Omar, and drawn by M/S. Odimbe & Co. Advocates, and witnessed by Odimbe &Co. Advocates, which clearly shows that the purported parties to it were illiterate.

$\Omega$

The contested document (Annexture ' $\Lambda$ ' of the plaint) is hereby declared a worthless document incapable of binding the purported parties thereto, who are the plaintiff, and Muhamed Suleman. It is trite law that the death of a partner dissolves the partnership. It therefore goes without saying that when the said Muhamed Suleman died the partnership in New Elgon Cinema stood dissolved. This is to say, without employing so many words, that there was no contract between the plaintiff and the first defendant, whether it be a Contract for transfer of shares as the defendants would argue; or whether it be a contract for securing a loan as the plaintiff would argue.

It is pertinent to bear in consideration the testimony of the plaintiff, in cross-examination, that Abdul Majid's share in the Cinema never got extinguished by the fact that he fled the Country.

The plaintiff had this to say about it:-

$\vert \mathbf{C} \vert \leq$

" His share is still there and we paid School fees for his Children up to the time Ali Omar took over the business. I used to give money to Abdul Majid's family".

If that was the position, as I have no cause to doubt it was, then, at law, at the time of the disputed agreement on 26th July 1985, the partnership between Abdalla Faraj, Muhamed Suleman and Abdul Majid was in existence. It continued in existence until the death of Muhamed Suleman when it got dissolved. And since we are not told any where that although Abdul Majid fled the Country he has died, on dissolution of the partnership each of the partners, (including the estate of the deceased partner) took his share.

The plaintiff would therefore be entitled to his share and not to the entire business as he appears to imply in the plaint. Whereas therefore he prays for a sum of Shs. 200,000,000/- or the value market/of the Cinema, I find it difficult to award him that figure which he claims to be the value of the Cinema for to award it to him would be to ignore the shares in the business of his co- partners. Besides it is impossible to decide as to how the plaintiff arrived at the value of the business so as to claim it, even assuming that he was entitled to the entire business to the exclusion of the other two partners. I find myself unable to grant the prayer and I dismiss it.

Further, in paragraph $10(1)$ the plaintiff lays claim to a monthly sum of Shs. $300,000/=$ as loss of income. Yet it is inconceivable how he arrived at that figure. A claim to the loss of income is almost like a claim to special damages. You do not only plead it but you must also prove it. No where throughout the case does the plaintiff claim to have earned a sum of Shs. 300,000/= per month or any sum. It would therefore be expecting too much for the plaintiff to expect any Court of justice to award him a loss of income which he did not prove. This claim is also rejected. I would in the same vein dismiss the claim in paragraph $10(g)$ for loss of income which was put by the plaint at Shs. $4,800,000/=$ . There is no proof of such income, let alone its loss.

$104$

I now pass on to the prayer in paragraph $10(e)$ for general damages for fraud and deceit. I have already decided that the defendants never committed wilful fraud and I maintain that if fraud and or deceit connote culpability then I am unable to find it. This is not to say that the plaintiff will be without remedy simply because the defendants, by negligence or theft decided to take away his shares of the business and deprived him of their enjoyment for so long. In his testimony he said he was unemployed and for so long he has been unemployed. I will award him Shs. 50 million as general damages for such deprivation. The defendants will pay it to him in such manner that the first defendant will pay shs. 20 million while the second defendant will pay shs. 30m/=. This is because the second defendant, being a lawyer, should have known better that what he and the first defendant did was illegal.

....18

I now pass on to the prayer in paragraph $10(f)$ which is for general damages against the first defendant. This is for trespass. I would award a similar sum of Shs. 30 million to $\lambda$ the plaintiff to be paid to him by the first defendant. d direct that the two awards in general damages be paid with interest at the rate of 30% per annum from the date of this judgment till payment in full. I also order that the defendants pay to the plaintiff Costs of this suit to be contributed by them in such a way that the first defendant shall pay 40% of the costs and the second defendant shall pay 60% of them. My reason for this is that the second defendant who is a lawyer should have known better than the first defendant the damage their joint action was bound to cause to the plaintiff.

J. H. NTABGOBA $\sim$ <br>PRINCIPAL JUDGE 27.03.98