Atyaba Agencies Ltd v Stanbic Bank Uganda Ltd (Civil Application 110 of 2003) [2004] UGCA 23 (16 January 2004)

# THE REPUBLIC OF UGANDA

## IN THE COURT OF APPEAL OF UGANDA AT KAMPALA

# CORAM: HON. MR. JUSTICE G. M. OKELLO, JA HON. MR. JUSTICE A. TWINOMUJUNI, JA HON. LADY JUSTICE C. N. B. KITUMBA, JA

# **CIVIL APPLICATION NO. 110 OF 2003**

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#### ATYABA AGENCIES LTD.::::::::::: **::::::::::::::::::::::APPLICANT**

### VERSUS

# STANBIC BANK UGANDA LTD.:::::::::::::::::::::::::::::::::::: [Arising out of Civil Appeal No. 69 of 2003]

# RULING OF THE COURT

This application is brought by Notice of Motion under rules 42 and 81 of the Court of Appeal Rules Directions, 1996. It seeks for an order to strike out Civil Appeal No. 69 of 2003 on the ground that the appellant is not a party to the appeal.

The main grounds of the application are:

- That the Appeal was instituted in the names of a $"1.$ wrong party who was not party to the proceedings in the lower court. - That M/s STANBIC BANK UGANDA LTD. has never $2.$ $30$ been merged with Uganda Commercial Bank Ltd.

#### 3. That in the premises there is no appeal from the Decree of the High Court in HCCS No. 1197 of 1999".

The application is supported by two affidavits of Andrew Wamina who is an advocate practising in the law firm of Kwesigabo, Bamwine and Walubiri Advocates, counsel for the applicant. The applicant was the plaintiff in HCCS No. 1197 of 1999.

The first affidavit was deponed to on $8^{th}$ September, 2003 and filed in court on the same day. The second affidavit, which is supplementary to the first one, was also sworn on 8<sup>th</sup> September, 2003 but filed in court on the following day.

The substance of Wamina's affidavits is that the present appellant, M/s Stanbic Bank Uganda Ltd., is a different entity from Uganda Commercial Bank Ltd. which was thedefendant in HCCS No. 1197 of 1997. The two companies have never been legally merged. There is an affidavit in reply by Dr. Joseph Byambara Byamugisha, learned counsel for the respondent, sworn on $9<sup>th</sup>$ September 2003. In his affidavit he avers that on 21<sup>st</sup> February 2002, with the approval of the Bank of Uganda, Standard Bank Investment Corporation Ltd. made an agreement which is annexture "B" to his affidavit with Uganda Commercial Bank Ltd. Under the agreement Uganda Commercial Bank Ltd. ceded and assigned its obligations to Stanbic Bank of Uganda Ltd.

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On 13th September, 2002 a merger agreement was concluded between Stanbic Bank Uganda Ltd. and Uganda Commercial Bank Ltd. The agreement is confidential and would be produced at the trial. That the physical merger of Uganda Commercial Bank and Stanbic Bank Uganda Limited was expected and that when the physical merger of the two banks was completed, Uganda Commercial Bank Ltd. would be wound up.

**10** and **20** There is also a second affidavit in reply by Syson Kekurutso, the compliance manager of Stanbic Bank Uganda Ltd. sworn on 10th September 2003. She avers that a sale of shares agreement was concluded between the Government of the Republic of Uganda, Stanbic Bank Uganda Ltd. and Standard Bank Group Ltd. She also avers that on 13th September 2002 between Stanbic a merger agreement was concluded Bank Uganda Ltd. and Uganda Commercial Bank Ltd. However, the physical merger of the operations could not be concluded in one single transaction but it is an ongoing process. That management decided that when a branch of Uganda Commercial Bank Ltd. satisfies the requirements, the branch is labelled and marked Stanbic Bank of Uganda Ltd.

During the hearing of the application Mr. Peter Walubiri, learned counsel for the applicant, based his submissions on Mr. Andrew Wamina's supporting affidavits and the annextures attached thereto.

defendants were Uganda Commercial Bank Ltd. and the Attorney General. However, according to Annexture "F", the Memorandum of Appeal, the appellant is Stanbic Bank Ltd. The appellant Stanbic Bank Uganda Ltd. is a new entity and has never been a party to the proceedings in the lower court. It has, therefore, no locus to institute the appeal. As the grounds were interrelated, learned counsel argued all of them together. He submitted that the Notice of Appeal (Annexture "E") shows that the party which intended to appeal is Uganda Commercial Bank Ltd. Annexture "G" which is the decree of the lower court indicates that the

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Dr. Byamugisha conceded that Uganda Commercial Bank Ltd and Stanbic Bank Uganda Ltd had not yet been legally merged. He even called Ms. Syson Kekurutso who gave evidence to that effect.

it He He explained that the reason why he filed the appeal in the names of Stanbic Bank Uganda Ltd was to assist the respondent to recover the decretal amount in case succeeded. Stanbic Bank Uganda Ltd had the capacity to pay whereas Uganda Commercial Bank Ltd, which is currently under liquidation, had no such capacity, requested in the alternative, that should the court find that he was in the wrong, it should invoke its inherent powers to strike out the name of Stanbic Bank Uganda Ltd. and replace it with that of Uganda Commercial Bank Ltd.

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From the evidence available and submissions of counsel it is clear to us that Uganda Commercial Bank Ltd. is still a separate legal entity from Stanbic Bank Uganda Ltd. $M/s$ Uganda Commercial Bank Ltd. filed the Notice of Appeal against the judgment of the High Court in HCCS No. 1197 of 1997 on 20<sup>th</sup> March 2003. It did not take any further steps to prosecute the appeal.

In order to properly institute the appeal, $M/s$ Uganda Commercial Bank Ltd. had to follow rule 82 (1) of the Rules of this court which provides that the appeal must be instituted within sixty days after filing the notice of appeal. In case one fails to do so, rule 83 of the Rules comes into operation. It provides as follows:

"83 if a party who has lodged a notice of appeal fails to institute an appeal within the prescribed time-

(a) He or she shall be taken to have withdrawn his or her notice of appeal and shall, unless the court otherwise orders, be liable to pay the costs arising from it of any persons on whom the <pre>notice of appeal was served;" (underlining ours.)</pre>

In the circumstances of this case we find that Uganda Commercial Bank Ltd. must be deemed in law to have abandoned its appeal. Stanbic Bank Uganda Ltd. had no locus standi to prosecute the appeal.

Dr. Byamugisha requested us to use our inherent powers according to rule $1(3)$ of the Rules of this court and strike $30$ out from the memorandum of appeal the name Stanbic

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Bank Uganda Ltd. and restore that of Uganda Commercial Bank Ltd.

In our view, the inherent powers of this court can only be used where there is a valid pending appeal. In the instant case, the notice of appeal is deemed to have been withdrawn after the expiry of sixty days prescribed by rule 82 (1) of the Rules of this court. No appeal exists. We are, therefore, not able to grant Dr. Byamugisha's request.

In the circumstances we find merit in the application. It is, therefore, allowed with costs to the respondent.

Dated at Kampala this.................................... .2004.

kello

**Justice of Appeal**

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Cres, K C. N. B. Kitumba **Justice of Appeal**

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