ATC Uganda Limited v Omiya Pachwo Sub County Local Government (Miscellaneous Application 10 of 2024) [2024] UGHC 743 (15 August 2024)

## **THE REPUBLIC OF UGANDA**

## **IN THE HIGH COURT OF UGANDA HOLDEN AT KITGUM**

## **MISCELLANEOUS APPLICATION No. 10/2024**

## **(Arising from KITGUM HIGH COURT - CIVIL SUIT No. 020/2022)**

## 5 **(Formerly GULU HIGH COURT - CIVIL SUIT No. 067/2022)**

## **ATC UGANDA LIMITED APPLICANT**

**Versus**

## **OMIYA PACHWO SUB COUNTY**

#### **LOCAL GOVERNMENT RESPONDENT**

# 10 **BEFORE HON. MR. JUSTICE PHILIP W. MWAKA. RULING.**

#### **Introduction and Background.**

- [1]. The Applicant, in its first prayer, seeks Orders from this Court for the issuance of a Third Party Notice to the Respondent as a necessary party to 15 the main suit filed against it - as the Defendant therein - in trespass to land for purposes of indemnifying or contributing to any liability that may arise and be imposed on it by the Court in the main suit being *High Court Civil Suit (Kitgum): No. 020/2022: Banya Alfred Vs. ATC Uganda Limited* – formerly *High Court Civil Suit (Gulu): No. 067/2022* and secondly that costs of the 20 Application are provided for. - [2]. The Application is *Ex Parte* and is instituted by way of Chamber Summons filed on the 29th May, 2024 brought under **Article 126 of the 1995 Constitution; Section 98 of the Civil Procedure Act, Cap. 71 (now cited as Cap. 282); and, Order 1 Rule 14(1) and (2) of the Civil Procedure** 25 **Rules, SI 71 - 1.**

- [3]. The citations were revised by the **Law Revision Act, Cap. 3** and **Statutory Instrument No. 049/2024: The Law Revision (Commencement of the 7 th Revised Edition) (Principal Laws) Instrument, 2024**. - [4]. Supporting the Application is an Affidavit attached deponed by the Applicant.

## **The Applicant's Case.**

- [5]. The Applicant's grounds are stipulated and expounded upon in the supporting Affidavit of Timothy Kansiime represented therein as the Senior Legal Manager of the Applicant and are: - - [6]. Firstly, that on the 24th 35 June, 2019 it executed a License Agreement with the Respondent in respect of land situated at Coo Dong village, Lolim Parish, Omiya Pachwa Sub-County in Agago County, Agago District measuring approximately 15 meters by 15 meters for purposes of constructing, operating and maintaining a telecommunications mast thereon. - 40 Attached to the supporting Affidavit as **Annexture "A"** is a copy of the License Agreement. - [7]. Secondly, that prior to the execution of the License Agreement pertaining to the suit land the Applicant conducted a due diligence in regard to ownership of the land and received assurances from the Respondent that it owned and 45 was in possession of the land. - [8]. Third, that the suit land was vacant and neither the Plaintiff in the main suit nor members of his family or any other person has been in possession, occupation or had usage of the land from the time of execution of the License Agreement and the subsequent construction of the telecommunications mast 50 in 2019.

Attached to the supporting Affidavit as **Annexture "B"** are photographs stated to be of the vacant suit land at the time prior to construction of the mast.

- [9]. Fourth, pursuant to the License Agreement the Applicant is entitled to 55 indemnification from the Respondent for any liability arising from the main suit as the Respondent had warranted and represented to the Applicant that it had the right to and authority over the suit land and in that respect issuance of the Third Party Notice is critical to the determination of the dispute with any liability that may be established against the Applicant concerning trespass 60 to the land directly attributable to the Respondent. - [10]. Fifth and lastly, that there is a serious issue (dispute) over ownership of the suit land due for consideration in the main suit between the Parties therein - Banya Alfred and ATC Uganda Limited - which may result in liability being imposed on the Applicant and to that end issuance of the Third Party Notice 65 is crucial to attain the ends of justice with the Application having been brought in good faith to conclusively resolve the matters of the ownership of the land and the Respondent will not be prejudiced if the Application is allowed.

#### 70 **Representation.**

[11]. Counsel, Ms. Emma Nantume, represented the Applicant. There was no official representative of the Applicant present in Court.

#### **Proceedings of the Court.**

[12]. The matter came up before the Court on the 30 75 th May, 2024 and the Applicant's Counsel represented to the Court that they had already filed their submissions together with the Application on the 29th May, 2024.

#### **The Applicant's Submissions.**

80 [13]. The Applicant addressed the issue(s) of – **Whether a Third Party Notice should issue in respect of the Respondent as a necessary party to the litigation in the main suit and the remedies available**.

**3 |** P a g e

- [14]. Citing **Order 1 Rule 14(1) and (2) of the Civil Procedure Rules** as well as **Miscellaneous Application No. 111/2022: ATC Uganda Limited Vs.** - 85 **Rashid Bitama & 2 Ors, Sango Bay Estates and Dresdner Bank (1971) EA 307** among other Authorities, the Applicant submitted that a Third Party Notice may upon an Application by Chamber Summons issue with the leave of the Court against a person or entity not party to a (main) suit where a Defendant claims entitlement to an indemnity or contribution arising from a 90 determination in the main action (suit). - [15]. The Applicant submitted that the rationale for the procedure involving issuance of a Third Party Notice to persons or entities not party to the main suit is to in the same action being tried before the Court, deal with and settle all disputes arising from a particular transaction constituting the original claim 95 or cause of action concerning the same subject matter with the respective requisite parties involved and with the Orders sought affecting all intended parties that may or would be expected to be involved in the main suit. - [16]. The grounds to be established are sufficient cause to join the Respondent as a Third Party; the subject matter between the Applicant and Respondent 100 being the same as the Subject matter between the Plaintiff and the Defendant; existing claims of indemnity and contribution; the consideration that the Plaintiff shall not suffer any prejudice should the Application be granted; and, the interests of justice requiring the suit to be heard on its merits. - [17]. In regard to sufficient grounds for grant of the Application to join the 105 Respondent as a Third Party considered together with claims of any existing indemnity and, or contribution, the Applicant submitted on the one hand that it executed the License Agreement with the Respondent as the owner of the suit land and under the terms of the License Agreement the Respondent warranted that it was the owner of the land; and, on the other hand, that the 110 Respondent would under the License Agreement indemnify the Applicant in the event of any claims or suits brought against it.

- [18]. The Applicant contends that by the Plaintiff instituting the main suit against it for Declaratory Orders that they are the rightful owners of the land, a claim has been instituted against it entitling it to claim indemnity from the 115 Respondent pursuant to the License Agreement and the issuance of the Third Party Notice is critical to determination of the dispute considering that the suit land was let (licensed) to the Applicant by the Respondent to construct a telecommunication mast upon ascertaining that the Respondent owned the land and was the right party to deal with in respect of the land. - 120 [19]. The Applicant submitted that the foregoing constituted sufficient grounds for grant of the Application to join the Respondent as a necessary Third Party to the suit for purposes of indemnifying or otherwise contributing to any liability that may be imposed on it. - [20]. The Applicant urged the Court to consider that the subject matter between 125 the Applicant and the Respondent is the same as the subject matter between the Plaintiff and the Defendant pleading trespass as the cause of action arising from claims of the Plaintiff that he is the lawful customary owner of the suit land and seeks orders from the Court including a permanent injunction against the Applicant (Defendant) or its agents from trespassing on the land. - 130 [21]. Specifically, in respect of the claims of indemnity and contribution the Applicant cited **Clause 14.1 of the License Agreement** and submitted that the Respondent warranted that it has the authority to enter into the agreement and indemnify the Applicant against any claim, suits and judgment in respect of the suit land with any liability that may arise being from the claims of 135 trespass against the Applicant being directly attributed to the Respondent through its claims of ownership and having let (licensed) the land to the Applicant. - [22]. It is on this basis that the Applicant prayed that the Respondent is joined as a Third Party.

- 140 [23]. In regard to whether any prejudice would be suffered by the Respondent and the interests of justice – the Applicant submitted that the Application is brought in good faith and there is a serious issue of ownership of the suit land involving the Plaintiff in the main suit and the Respondent herein to be determined by the Court and may involve imposing liability. In that regard, 145 the issuance of the Third Party Notice would enable the Court expeditiously determine pertinent contentious matters - including matters of indemnity or contribution. As such, no prejudice will be occasioned to the Respondent. - [24]. In conclusion, the Applicant prayed that costs are provided for.

#### 150 **Considerations and Determination of the Court.**

[25]. The core issue for consideration to be addressed by the Court in regard to the present Application is –

**Whether sufficient cause is established for the Court to exercise its discretion to issue a Third Party Notice.**

155 [26]. The Applicant's claims for indemnity and, or contribution against the Respondent giving rise to this Application for the issuance of a Third Party Notice is rooted in both **Order 1 Rule 14 of the Civil Procedure Rules** and **Clause 14 of the License Agreement** executed between the Applicant and the Respondent. The provisions of both are instructive and are reproduced 160 hereunder *verbatim* –

## **Order 1 Rule 14 - Notice to Third Party.**

#### **Order 14 Rule 1:**

**"Where a Defendant claims to be entitled to contribution or indemnity** 165 **over against any person not a party to the suit, he or she may, by leave of the Court, issue a notice (hereafter called a "Third Party Notice") to that effect.**

#### **License Agreement - Clause 14:**

170 **Clause 14.1: The Licensor warrants that –**

**14.1.1 - The Licensor is aware of the requirements and objectives of the Licensee in relation to its use of the premises;**

**14.1.2 - The Licensor has the authority and powers legally necessary to enter into this License and to grant to the Licensee the** 175 **rights provided for in this License; … …**

> **14.1.4 - The Licensor shall indemnify the Licensee against any and all claims, suits, judgments and any other liability arising or resulting from the discovery of any toxic or hazardous substance on or in the premises save for those that are a result of the Licensee's activities.**

- [27]. The Court observes that the indemnity cited is an express *"contractual indemnity"* as agreed upon by the Parties (Applicant and Respondent) under the License Agreement, as distinguished from other types of indemnity. - [28]. A review of **Clause 14.1** of the License Agreement which the Applicant 185 principally relied on indicates that the indemnity is not as wide as it would like or seem to claim. Rather, the indemnity is in fact limited in scope, application, reach and circumstances as envisaged by the Parties (Applicant and Respondent) and its expressly stipulated terms reproduced *verbatim* in the License Agreement herein-above do not support the Applicant's claim or 190 invocation of indemnity when cross-referenced with the declarations and orders sought by the Plaintiff in the main suit. - [29]. The claim (cause of action) in the main suit between the Plaintiff and the Defendant (Applicant herein) is founded in claims of trespass, ownership of the suit land and lost earnings and the declarations and orders sought are for 195 trespass and a permanent injunction in that regard as against the Applicant (Defendant therein), ownership in favour of the Plaintiff and mesne profits as against the Applicant (Defendant). [30]. The indemnity on the other hand is specific and only invoked or triggered by claims, suits, judgments and any other liability arising or resulting from the 200 discovery of any toxic or hazardous substance on or in the premises attributed to the Licensor (Respondent). Interestingly, the Licensee (Applicant) purports to insulate itself under the indemnity much as such damage or harm is provided for by the relevant National Environmental Laws.

## **See: Toxic Chemicals Prohibition and Control Act, Cap. 329,** 205 **Occupational Safety and Health Act, Cap. 231 and the National Environment Act, Cap. 181**

- [31]. It is therefore clear that the scope and application of the indemnity is limited to and triggered by environmental damage attributed to the Respondent. - [32]. It is the finding of the Court that there is no nexus between the claims and 210 remedies sought in the main suit and the provisions of the Indemnity in the License Agreement to trigger issuance of a Third Party Notice. - [33]. The indemnity in **Clause 14.1** of the License Agreement does not cover the claims founded in trespass as sought in the main suit herein. There is therefore no basis for a finding of sufficient cause to issue a Third Party Notice in 215 relation to indemnity. - [34]. This, however, leaves for the consideration of the Court the alternate assertion of *"contribution"* raised by the Applicant (Defendant in the main suit) as against the Respondent (as the intended Third Party) as an optional basis for issuance of a Third Party Notice which in effect impleads the Third Party 220 as a Co-Defendant, of sorts. The claim of contribution in effect enables the Court at or after the Trial – should it be necessary to consider the liability of multiple tortfeasors – simultaneously consider and apportion liability, especially where the original party (Plaintiff) was not privy to a subsisting contractual agreement or arrangement – such as the License Agreement 225 herein. The matters in respect of the contribution (as in the event of an indemnity) are tried specifically between the Defendant and the Third Party.

[35]. The contribution involves dividing up of the Plaintiff's damages between two or multiple parties found liable. Even between Defendants, multiple Defendants may seek contribution from each other. The Defendants would 230 be considered to be jointly and severally liable for the Plaintiff's loss. This may be inspite of the Third Party not explicitly or being directly liable to the Plaintiff. In the instant case, the Third Party Notice may issue whether the Plaintiff or his claim under the suit is known to the Respondent, or not.

- [36]. The tortfeasors may recover contribution from any other person who may be 235 liable in respect of the same damage and the *"cause of action"* for contribution is triggered upon judgment being entered against the tortfeasors (Defendant) in favour of the party injured by the tort. - [37]. The Court determines the entitlement to the contribution as it may consider just and equitable having regard to the extent of the parties' respective 240 responsibility for the damage. The liability is as a matter of fact for the same damage.

### **See: Halsbury's Laws of England – Volume 97A (2021) 49-52; Volume 29 (2019) 620-625.**

- [38]. The distinction between an indemnity and a contribution and the respective 245 circumstances in which each arises was considered in **Miscellaneous Application No. 1236/2014: Lasto Bosco Mayanja Vs. Lugya Ronald Hon, Justice Monica Mugenyi** citing incidences for a contribution as opposed to an indemnity in the following terms – - 250 **"… it seems to me that an Applicant for Third Party Notice would be required to establish his or her right to Indemnity or Contribution. In the instant case, the Applicant's application is premised on a claim in Indemnity and not Contribution …**

255 **Nonetheless, for completion, I shall briefly address the concept of contribution in Third Party proceedings. When two or more people are jointly liable for the same tort and a Plaintiff claiming thereunder seeks to make good his injury from one of them as Defendant, the said Defendant may seek contribution from other tortfeasors. See Oxford** 260 **Dictionary of Law, Oxford University Press, Seventh Edition, p.132. I find a claim for contribution inapplicable to the present circumstances as the Defendant and Third Party are not jointly liable in trespass herein."**

# **Also See: High Court Civil Suit No. 283/2012: Al Hajji Nasser Ntege** 265 **Sebagala Vs. MTN Uganda Limited & SMS Media Limited (Hon. Justice Madrama Izama).**

- [39]. In the instant case, the common tort affecting the Defendant who is the Applicant herein – in as far as it rights to the use, possession and occupation of the same land as Licensee in the operation of its telecommunication masts 270 and towers under the Licensing Agreement - and the Respondent (Intended Third Party) – as the Licensor of the same land after asserting ownership - is the claim of trespass asserted by the Plaintiff in direct contest to the Respondent's claim of ownership. Therefore, there is a clear nexus between the subject matter in the main suit between the Plaintiff and the Defendant 275 (Applicant) being trespass as well as the Respondent's claims of entitlement. - [40]. It is in the interests of the Respondent to participate in the litigant of the main suit – moreso being a Public entity, in which land which has been considered as part of public property and potentially public revenue is at stake. - [41]. In fact, regardless of the instant Application, the Respondent would have 280 been well advised to itself seek to be joined herein to participate in the litigation in respect of the ownership of the land it claims as its own (refuting claims of trespass) and on which basis it licensed the Applicant from 2019 to 2034 - being a duration of fifteen (15) years, with options to renew.

- [42]. In conclusion, the commonalities which persuade the Court to grant this 285 Application are – firstly, all the respective parties have a claim of interest in the suit land which is the subject of litigation in respect of ownership and trespass hence a common cause of action; secondly, any orders issued by the Court arising from the litigation would directly affect all the parties in one way or another; thirdly, the Court can simultaneously and comprehensively 290 consider and dispose of all claims and interests without the risk of overlooking any specific interest which would in effect eliminate multiplicity of suits and attaining finality; fourth and lastly, the Court considers it in the interests of justice that the Third Party Notice is issued and considers that no prejudice would be occasioned as against the Respondent. - 295 [43]. Having carefully given due consideration to the Application, supporting Affidavit and Annextures thereto and the circumstances of the case including the Pleadings in the main suit as well as the Written Submissions filed, the Application is hereby granted and with the leave of the Court a Third Party Notice shall issue as against the Respondent to forthwith be impleaded and 300 joined as a Third Party in the main suit **High Court Civil Suit (Kitgum):** - **No. 020/2022** formerly **High Court Civil Suit (Gulu): No. 067/2022)**. - [44]. It shall be necessary for the parties in the main suit to duly and timely amend the Pleadings to incorporate the Respondent who has been added in view of the main suit being fixed for the 18th September, 2024. - 305 [45]. The Applicant shall meet its own costs of the Application.

#### **Orders of the Court.**

[46]. Accordingly, the Court makes the following Orders: -

1. The Application is granted and leave is granted by the Court to implead and join the Respondent as a Third Party in the main suit - **High Court**

## 315 **Civil Suit (Kitgum): No. 020/2022** formerly **High Court Civil Suit (Gulu): No. 067/2022**.

- 2. The Parties in the Main Suit shall amend their respective Pleadings to incorporate the Respondent as a Third Party to the litigation. - 3. The Applicant shall meet its own costs of the Application.

320 It is so Ordered.

**Signed and Dated on the 15 th day of August, 2024 at Kitgum High Court** 335 **Circuit.**

**Philip W. Mwaka**

**Acting Judge of the High Court.**

### **Delivery and Attendance.**

- 340 This signed and dated Ruling has on the directions of the Presiding Judge shall be delivered to the Parties electronically on **Thursday, 15 th day of August, 2024 at 10:00am** by the Deputy Registrar, Kitgum High Court Circuit. - 1. Deputy Registrar, Kitgum High Court Circuit: Mrs. Suzanne Aisia Musooli. - 2. Counsel for the Applicant: Ms. Emma Nantume. - 345 3. Court Clerk and Interpreter: Mr. Atube Michael. - 4. Interested and Affected Persons and Entities.

**Philip W. Mwaka**

**Acting Judge of the High Court.**

350 **Kitgum High Court Circuit.**

**15 th day of August, 2024.**