Ariong v Angina and Anor (H.C.Miscellaneous Application No. 383 of 2020) [2021] UGCommC 107 (27 January 2021)

Full Case Text

# **THE REPUBLIC OF UGANDA**

# **IN THE HIGH COURT OF UGANDA AT KAMPALA**

## **[COMMERCIAL DIVISION]**

### **M. A No. 383 of 2020**

## **(Arising from HCCS No. 999 of 2019)**

# **ARIONG JOSEPH ODEA :::::::::::::::::::::::::::::::::::::APPLICANT**

### **VERSUS**

### **1. CHARLES OLINGA ANGINA**

- **2. DIAMOND TRUST BANK:::::::::::::::::::::::::::::::::::RESPONDENTS BEFORE: HON. JUSTICE DUNCAN GASWAGA RULING** - [1] This is a ruling on an application brought under Order 1 rule 13, Order 52 rule 1 CPR and Section 98 CPA for orders that; Diamond Trust Bank (Uganda) be added as a defendant in Civil Suit No. 999 of 2019 currently pending before this court and costs of this application be in the cause. - [2] The application is supported by the affidavit of **Ariong Joseph Odea,** the applicant, herein expounding on the grounds relied on which are briefly that; that on the 27/07/2013 pursuant to a guarantee from the applicant the respondent took an additional loan facility from Diamond Trust Bank for the purchase of a residential house at plot No. 4987 & 1098, Kyadondo Block 244, Kampala, that without authorization and in breach of the established procedures, loan facility deeds, Diamond Trust Bank unlawfully debited the applicant's account to the tune of Ugx 442,678,563 and credited the respondents account to offset the said loan, that the deduction and payments done by Diamond Trust

Bank were for the sole benefit of the respondent and the bank, to the detriment of the applicant, that Civil Suit No. 999 of 2019 was earlier instituted solely against the respondent but the applicant realized it will be appropriate to add the other beneficiary of the impugned transaction, Diamond Trust Bank (U) Ltd as a party to avoid a multiplicity of suits; that the cause of action in the main suit arises out of the same series of acts weaving the applicant herein together with the intended defendant being Diamond Trust Bank (U) Ltd; that if a separate suit was brought against Diamond Trust Bank (U) Ltd, common questions of law and fact would arise; that the presence of the intended defendant Diamond Trust Bank (U) Ltd is necessary for the court to effectively and completely adjudicate upon and settle all questions in the main suit and that it is in the interests of justice and disposal of the main suit that the intended defendant is added as a party to the suit.

- [3] At the hearing of this application, the respondents raised a preliminary objection and court requested them to file written submissions addressing the same. - **[4]** This application raises one issue to wit; *whether the 2nd respondent merits being added as a party to Civil Suit No. 999 of 2019.* - [5] Counsel for the applicant stated in his submissions that the relevant law on addition of parties is Order 1 rules 3,7 and 10(2) of the CPR. He additionally relied on the authority of **Salim Jamal & Others Vs. Uganda Oxygen Limited and Others, Supreme Court Civil Appeal No. 64 of** 1995(unreoorted1 where the trial court added the company as a defendant to the action so as to be able to effectively deal with the remedies that the company was entitled to on the basis of the

plaintiff's successful action. The Supreme Court upheld the joiner of Uganda Oxygen Ltd as a defendant under Order 1 rule 10(2) of the CPR. That the same order avails the parties to a suit a remedy to apply to court to add a party, or the party may be added at the instance of the court and the presence of that party would enable the court to effectually and completely adjudicate upon and settle all questions involved in the suit. That owing to the fact that the 2nd respondent debited the applicant's account to the tune of 442,678.563/= for the benefit of the 1st respondent as such it is important to add it (the bank) as it was a beneficiary of the impugned transaction. Counsel further relied on the case of **Samson Sempasa**

**Vs. P. K Senqendo, M. A No. 577 of 2013** wherein it was held that;

*"it is a fundamental consideration that before a person can be joined as a party, it must be established that the party has high interest in the case. In addition, it must be clearly demonstrated that the orders sought in the main suit would directly legally affect the party seeking to be added".*

That the applicant fulfills that condition.

[6] In reply, counsel for the 1st respondent raised a preliminary objection to the effect that the instant application and the suit from which it arises, Civil Suit No. 999 of 2019 are barred by the principle of lis pendens and would consequently be barred by the principle of resjudicata upon judgment in Civil Suit No. 76 of 2018 being delivered and that the instant application is an abuse of court process due to being a multiplicity of suits. Counsel relied on Section 6 to state that the instant application and suit from which it arises offend the principles therein stating that the matters in issue in the instant

application. Counsel further dealt with the particular considerations to be looked up to determine whether the instant application offends the above principles.

- [7] On whether the matters in the application are directly and substantially in issue in a previously instituted suit, counsel stated that M. A No. 383/2020 and H. C. C. S No.999/2019 from which it arises are founded on the same facts and seek the same remedies as those sought in H. C. C. S No. 76/2018 which is pending judgment before Justice Wangutusi. Counsel further submitted that the issues herein specifically that about the Ugx. 442,678,563/= is directly and substantially in issue in HCCS No. 76/2018 and will be determined by Justice Wangutusi. Counsel relied on the case of **Springs International Hotel Ltd Vs. Hotel Diplomate & Boney M. Katatumba, Civil Suit No. 227/2011.** - [8] On whether the previously instituted suit and instant application are between the same parties, Counsel relied on **Equity Bank (U) Ltd Vs. Buyinza John, M. C. No. 33/2018** where Wamala J, while quoting **Springs International Hotel Vs. Hotel Diplomate & Boney M, Katatumba** (supra) stated that *"the phrase "same parties" in the context of the lis pendens rule does not have to relate to literally all the parties to the two suits, the parties just need to be directly and substantially the same",* to state that this is the matter before court. That in reference to the two plaints filed before this court, it is apparent on the face of the pleadings that of the four parties in HCCS No. 76/2018, Charles Angina, the 1st respondent herein was the plaintiff whereas of the three defendants in the earlier suit, the applicant and the 2nd respondent were the 2nd and 1st defendants

respectively. That the test in the rule is whether the parties in the previous suit are directly or substantially the same as in the subsequent suit; and the answer is in the affirmative.

- [9] Counsel further submitted that both the instant application and the suit from which it arises and the previous suit C. S. 76/2018 are both pending before this court which is a competent court to grant the reliefs sought. As such it is not a dispute that both suits are before the same court, which is the High Court Commercial Division. Counsel further relied on the case of **Ganatra Vs. Ganatra [20071 1 EA 76 at P.82** to state that the instant application and the suit from which it arises will be res judicata upon determination of H. C. C. S 76/2018. Counsel further stated that the instant suit is a multiplicity of suits and therefore an abuse of court process. He relied on the case of **Attorney General Vs. James Mark Kamoqa & Anor, SCCA No. 8 of 2004,** where it was stated that *"abuse of court process involves the use of the process for an improper purpose or a purpose for which the process was not established".* - [10] Counsel submitted that one instance of abuse of court is in the filing of a multiplicity of suits. That the applicant herein acted in abuse of court process by filing the instant suit well knowing that an earlier suit was pending in this very court with parties and issues directly and substantially the same. Counsel called upon the court to exercise its powers under Section 98 CPA, Section 17(2) and 33 of the Judicature Act to curtail his abuse of court process. Counsel concluded by indicating that he had taken note of the applicant's submissions but that court ought to disregard them because the

application and main suit are barred in law and simply an abuse of court process.

- [11] Counsel for the 2nd respondent equally raised a preliminary objection on the same points. In a brief rejoinder, the applicant reiterated his submissions. Counsel for the applicant also added that the prayers sought in C. S 76/2018 were substantially different from the issues in the instant application considering that in the former, the applicant was simply seeking declaratory orders whereas in Civil Suit 999/2019 the applicant is seeking special damages to the tune of Ugx 442,678,563/= being money debited off the applicant's account by the second respondent to service the 1st respondents loan. That the 2nd respondent ought to be added to clarify on the money being debited off the applicant's account. Counsel concluded that the money claimed is not directly and substantially in issue as averred by the respondent. - [12] In a brief rejoinder Counsel for the 1st respondent reiterated their earlier submissions and stated that the instant application is prejudicing the 1st respondent by subjecting him to a multiplicity of suits and that it is an abuse of court process. He concluded by praying that this court dismisses the suit for being an abuse of court process with costs to the defendant or in the alternative the suit is stayed pending the judgment in Civil Suit 76/2018. - [13] I will first deal with the preliminary objection then proceed to the instant application. - [14] Section 6 CPA states thus;

*"No court shall proceed with the trial of any suit or proceeding in which the matter in issue is also directly and substantially in*

*issue in a previously instituted suit or proceeding between the same parties, or between parties under whom they or any of them claim, litigating under the same title, where that suit or proceeding is pending in the same or any other court having jurisdiction in Uganda to grant the relief claimed."*

This in essence is the lis pendens rule. The Black's Law Dictionary (8th Ed) defines '7/s *pendens", as a latin expression which simply refers to a ''pending suit or action".* A number of considerations have to be looked at to consider whether the instant suit/application is barred by the "lis pendens" rule and these are;

*(i) Whether the matter(s) in issue in the instant suit are directly and substantially in issue in a previously instituted suit,*

*(ii) Whether the previously instituted suit is between the same parties (Hi) Whether the suit is pending before in the same or any other court having jurisdiction to grant the reliefs claimed* as stated in the case of **Springs International Hotel Vs. Hotel Diplomate Ltd and Anor Civil Suit No.227/2011.**

[15] On whether the matters in issue in the instant suit are directly and substantially in issue in a previously instituted suit, the 1st and 2nd respondents noted that the matters in issue in the instant application and the suit from which it arises are dealing with the same matters. In a rejoinder, Counsel for the applicant stated that the matters in the two suits were substantially different owing to the fact that the plaintiff in Civil Suit No. 76 of 2018 seeks declaratory orders while in Civil Suit No. 999/2019 the applicant seeks special damages in the sum of Ugx 442,678,563/= being money debited off the plaintiff's account by the 2nd respondent, Diamond Trust Bank, to service the 1st respondent's

mortgage over property comprised in Plot No 4987 & 1098, Kyadondo Block 244, Kampala. I will quote the applicant's submissions in rejoinder; Prayer (d) in Civil Suit No. 76 of 2018 *"An order directing the 1st and 2nd defendant to provide an account for the interest and monies paid by the plaintiff to service his mortgage on Muyenga Property and refund the part thereof after the date the plaintiff was deprived of the said property in full''*

- [16] From the above quotation it is clear that what is sought by the applicant boils down to recovery of Ugx 442,678,563/= being money debited from the applicant's account to service the mortgage of the 1st respondent. This then means that once the court finds that the 1st and 2nd defendant acted fraudulently and illegally and consequently cannot account for the said monies then the court will order for a refund of the same. The applicant further stated that the 2nd respondent is being added to clarify on the above transaction. It is the opinion of this court that the clarification sought by the applicant in this regard will be dealt with in the originally instituted suit Civil Suit No. 76 of 2018. In the circumstances therefore, I find that the matters herein are directly and substantially in issue in a previously instituted suit i.e H. C. C. S No,76 of 2018. - [17] On whether the previously instituted suit is between the same parties, it is important to note hereunder that Civil Suit No. 76 of 2018 was between Charles Angina, the 1st respondent herein, Diamond Trust Bank(2nd respondent), Ariong Joseph(applicant herein) and another party. Civil Suit No. 999 of 2019 from which this application arises is between Ariong Joseph Odea and Charles Angina and by this application the applicant seeks to add Diamond Trust Bank. This

therefore means that of the parties in Civil Suit No. 76 of 2018, two of them are in Civil Suit No, 999/2019 and one is sought to be added. In **Springs International Hotel Ltd Vs. Hotel Diplomate Ltd & Anor** it was held that the phrase "same parties" in the context of the lis pendens rule does not have to relate to literally all the parties to the two suits; the parties just need to be directly or substantially the same. This is the case with this application.

- [18] On whether the suit is pending in the same or any other court having jurisdiction to grant the reliefs claimed, it was earlier submitted that Civil Suit No. 76 of 2018 is pending judgment before His Lordship Justice David K. Wangutusi in the High Court, Commercial Division. Civil Suit No. 999 of 2019 from which this application arises is before me still in the High Court Commercial Division. As such, I find that both suits are pending before the same court having jurisdiction to grant the reliefs claimed. - [19] From the foregoing therefore, I find that the applicant's actions of filing a suit with matters similar to the one previously filed is an action of multiplicity of suits which in effect is an abuse of court process. In **Springs International Hotel Vs, Hotel Diplomate Ltd & Anor** (supra) the court while relying on the case of **Attorney General Vs, James Mark Kamoga & Anor, SCCA No.8 of 2004,** held that; *"Abuse of Court process involves the use of the process for an improper purpose or a purpose for which the process was not established".* It was further stated that; *"A malicious abuse of legal process occurs when the party employs it for some unlawful object, not the purpose which it is intended by law to effect; in other words, a perversion of it".* The applicant's action of filing a suit with similar

matters as those in Civil Suit No. 999 of 2019 is a blatant abuse of court process for which reason this application ought to fail.

- [20] As for the application to add the 2nd respondent to Civil Suit No.999 of 2019, the same cannot be proceeded with nor granted considering that the preliminary objection raised disposes off the current application. - [21] **In the circumstances therefore, I find that the instant application lacks merit and is dismissed with costs for being an abuse of court process.**

## **I so order**

**Dated, signed and delivered this 27th day of January, 2021**

**Duncan/Gaswaga JUDGE**