British American Tobacco Uganda Ltd v Bamuda Tobacco Company Ltd (HCT-00-CC-MA 599 of 2005) [2005] UGCommC 57 (4 October 2005)

{\rtf1\ansi\ansicpg1252\uc1\deff0\stshfdbch0\stshfloch0\stshfhich0\stshfbi0\deflang1033\deflangfe1033{\fonttbl{\f0\froman\fcharset0\fprq2{\*\panose 02020603050405020304}Times New Roman;}{\f37\froman\fcharset238\fprq2 Times New Roman CE;} {\f38\froman\fcharset204\fprq2 Times New Roman Cyr;}{\f40\froman\fcharset161\fprq2 Times New Roman Greek;}{\f41\froman\fcharset162\fprq2 Times New Roman Tur;}{\f42\froman\fcharset177\fprq2 Times New Roman (Hebrew);} {\f43\froman\fcharset178\fprq2 Times New Roman (Arabic);}{\f44\froman\fcharset186\fprq2 Times New Roman Baltic;}{\f45\froman\fcharset163\fprq2 Times New Roman (Vietnamese);}}{\colortbl;\red0\green0\blue0;\red0\green0\blue255;\red0\green255\blue255; \red0\green255\blue0;\red255\green0\blue255;\red255\green0\blue0;\red255\green255\blue0;\red255\green255\blue255;\red0\green0\blue128;\red0\green128\blue128;\red0\green128\blue0;\red128\green0\blue128;\red128\green0\blue0;\red128\green128\blue0; \red128\green128\blue128;\red192\green192\blue192;}{\stylesheet{\ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 \snext0 Normal;}{\*\cs10 \additive \ssemihidden Default Paragraph Font;}{\*\ts11\tsrowd\trftsWidthB3\trpaddl108\trpaddr108\trpaddfl3\trpaddft3\trpaddfb3\trpaddfr3\tscellwidthfts0\tsvertalt\tsbrdrt\tsbrdrl\tsbrdrb\tsbrdrr\tsbrdrdgl\tsbrdrdgr\tsbrdrh\tsbrdrv \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs20\lang1024\langfe1024\cgrid\langnp1024\langfenp1024 \snext11 \ssemihidden Normal Table;}{\s15\ql \li0\ri0\widctlpar \tqc\tx4320\tqr\tx8640\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 \sbasedon0 \snext15 \styrsid3682262 footer;}{\*\cs16 \additive \sbasedon10 \styrsid3682262 page number;}} {\*\latentstyles\lsdstimax156\lsdlockeddef0}{\*\listtable{\list\listtemplateid2066926160\listhybrid{\listlevel\levelnfc0\levelnfcn0\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698703 \'02\'00.;}{\levelnumbers\'01;}\fi-360\li720\jclisttab\tx720\lin720 }{\listlevel\levelnfc4\levelnfcn4\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698713\'02\'01.;}{\levelnumbers\'01;}\fi-360\li1440 \jclisttab\tx1440\lin1440 }{\listlevel\levelnfc2\levelnfcn2\leveljc2\leveljcn2\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698715\'02\'02.;}{\levelnumbers\'01;}\fi-180\li2160\jclisttab\tx2160\lin2160 }{\listlevel \levelnfc0\levelnfcn0\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698703\'02\'03.;}{\levelnumbers\'01;}\fi-360\li2880\jclisttab\tx2880\lin2880 }{\listlevel\levelnfc4\levelnfcn4\leveljc0\leveljcn0 \levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698713\'02\'04.;}{\levelnumbers\'01;}\fi-360\li3600\jclisttab\tx3600\lin3600 }{\listlevel\levelnfc2\levelnfcn2\leveljc2\leveljcn2\levelfollow0\levelstartat1\levelspace360 \levelindent0{\leveltext\leveltemplateid67698715\'02\'05.;}{\levelnumbers\'01;}\fi-180\li4320\jclisttab\tx4320\lin4320 }{\listlevel\levelnfc0\levelnfcn0\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext \leveltemplateid67698703\'02\'06.;}{\levelnumbers\'01;}\fi-360\li5040\jclisttab\tx5040\lin5040 }{\listlevel\levelnfc4\levelnfcn4\leveljc0\leveljcn0\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698713 \'02\'07.;}{\levelnumbers\'01;}\fi-360\li5760\jclisttab\tx5760\lin5760 }{\listlevel\levelnfc2\levelnfcn2\leveljc2\leveljcn2\levelfollow0\levelstartat1\levelspace360\levelindent0{\leveltext\leveltemplateid67698715\'02\'08.;}{\levelnumbers\'01;} \fi-180\li6480\jclisttab\tx6480\lin6480 }{\listname ;}\listid1695114398}}{\*\listoverridetable{\listoverride\listid1695114398\listoverridecount0\ls1}}{\*\rsidtbl \rsid279421\rsid686282\rsid1078454\rsid1389264\rsid1732057\rsid1912444\rsid2764134 \rsid2970107\rsid3364981\rsid3544375\rsid3682262\rsid4225526\rsid4422842\rsid5052216\rsid5385376\rsid6514145\rsid6768435\rsid7156197\rsid7160559\rsid7495110\rsid8540856\rsid8719697\rsid8986281\rsid9141455\rsid10646854\rsid11148039\rsid11223521 \rsid12127468\rsid12342474\rsid13047417\rsid13522127\rsid14292348\rsid14378091\rsid14550659\rsid14974235\rsid15169374\rsid15536962\rsid15622417\rsid15750412\rsid15861250}{\*\generator Microsoft Word 11.0.6568;}{\info{\title THE REPUBLIC OF UGANDA} {\author Fredrick Egonda-Ntende}{\operator Harry Mak}{\creatim\yr2006\mo2\dy7\hr10\min14}{\revtim\yr2006\mo2\dy7\hr10\min14}{\printim\yr2005\mo9\dy26\hr15\min42}{\version2}{\edmins0}{\nofpages3}{\nofwords1160}{\nofchars6616}{\*\company }{\nofcharsws7761} {\vern24579}}\widowctrl\ftnbj\aenddoc\noxlattoyen\expshrtn\noultrlspc\dntblnsbdb\nospaceforul\formshade\horzdoc\dgmargin\dghspace180\dgvspace180\dghorigin1800\dgvorigin1440\dghshow1\dgvshow1 \jexpand\viewkind1\viewscale100\pgbrdrhead\pgbrdrfoot\splytwnine\ftnlytwnine\htmautsp\nolnhtadjtbl\useltbaln\alntblind\lytcalctblwd\lyttblrtgr\lnbrkrule\nobrkwrptbl\snaptogridincell\allowfieldendsel\wrppunct \asianbrkrule\rsidroot279421\newtblstyruls\nogrowautofit \fet0{\*\ftnsep \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 {\insrsid2970107 \chftnsep \par }}{\*\ftnsepc \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 {\insrsid2970107 \chftnsepc \par }}{\*\aftnsep \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 {\insrsid2970107 \chftnsep \par }}{\*\aftnsepc \pard\plain \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 {\insrsid2970107 \chftnsepc \par }}\sectd \linex0\headery708\footery708\colsx708\endnhere\titlepg\sectlinegrid360\sectdefaultcl\sectrsid3682262\sftnbj {\footer \pard\plain \s15\ql \li0\ri0\widctlpar \tqc\tx4320\tqr\tx8640\pvpara\phmrg\posxc\posy0\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid2970107 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 {\field{\*\fldinst {\cs16\insrsid6514145 PAGE }}{\fldrslt { \cs16\lang1024\langfe1024\noproof\insrsid14378091 2}}}{\cs16\insrsid6514145 \par }\pard \s15\ql \li0\ri0\widctlpar\tqc\tx4320\tqr\tx8640\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\insrsid6514145 \par }}{\*\pnseclvl1\pnucrm\pnstart1\pnindent720\pnhang {\pntxta .}}{\*\pnseclvl2\pnucltr\pnstart1\pnindent720\pnhang {\pntxta .}}{\*\pnseclvl3\pndec\pnstart1\pnindent720\pnhang {\pntxta .}}{\*\pnseclvl4\pnlcltr\pnstart1\pnindent720\pnhang {\pntxta )}} {\*\pnseclvl5\pndec\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl6\pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl7\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl8 \pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl9\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}\pard\plain \qc \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid279421 \fs24\lang2057\langfe1033\cgrid\langnp2057\langfenp1033 {\insrsid279421 THE REPUBLIC OF UGANDA}{\insrsid15861250 \par }\pard \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\insrsid279421 \par }\pard \qc \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid279421 {\insrsid279421 IN THE HIGH COURT OF UGANDA AT KAMPALA \par \par (COMMERCIAL COURT DIVISION) \par \par HCT-00-CC-MA-599-2005 \par \par (Arising from HCT-00-CC-CS-572-2005) \par }\pard \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\insrsid279421 \par BRITISH AMERICAN TOBACCOUGANDA LIMITED APPLICANT \par \par VERSUS \par \par BAMUDA TOBACCO COMPANY LIMITED RESPONDENT \par \par \par }{\b\ul\insrsid279421\charrsid279421 BEFORE: THE HON. MR. JUSTICE FMS EGONDA-NTENDE \par \par RULING \par }{\insrsid279421 \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid279421 \hich\af0\dbch\af0\loch\f0 1.\tab}}\pard \ql \fi-360\li720\ri0\sl360\slmult1\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls1\adjustright\rin0\lin720\itap0\pararsid3682262 { \insrsid279421 The applicant, who is also the plaintiff in the head suit, is seeking, a temporary injunction to restrain the respondent from buying tobacco from farmers i n Northern Uganda during the 2005/2006 tobacco buying season and from interfering with the plaintiff\rquote s sponsorship contracts with tobacco farmers in the same region or procuring or attempting to procure}{\insrsid4422842 the breach of the said contracts. The applicant further seeks that the costs of this application be provided for.}{\insrsid3544375 The application is brought by notice of motion and supported by an affidavit.}{\insrsid279421 \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid1389264 \hich\af0\dbch\af0\loch\f0 2.\tab}}{\insrsid1389264 Four}{\insrsid4422842 grounds are set forth in support of this application. Firstly that the applicant has a prima facie case against the respondent. Secondly it is claimed that if the injunction is not issued the applicant will suffer will suffer }{\insrsid3682262 irreparable}{\insrsid4422842 damage. Thirdly that it is in the interests of justice for an inju}{\insrsid3544375 n}{ \insrsid4422842 ction to issue. And lastly that on a bala}{\insrsid3544375 nce of convenience favour lies }{\insrsid4422842 with issuance rather than none-}{\insrsid3682262 issuance}{\insrsid4422842 of the temporary injunction. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid3544375 \hich\af0\dbch\af0\loch\f0 3.\tab}}{\insrsid3544375 This application is opposed by the respondent who filed an affidavit in reply to the affidavit filed by the applicant. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid4422842 \hich\af0\dbch\af0\loch\f0 4.\tab}}{\insrsid4422842 This application is brought under Order 37 Rule 1(a) and 9 of the Civil Procedure Rules. I shall out Order 37 Rule 1(a) at the outset. }{\insrsid9141455 \par }\pard \ql \li1440\ri1440\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin1440\lin1440\itap0\pararsid3682262 {\insrsid4422842 \lquote 1. Where in any suit it is proved by affidavit or otherwise ---- }{\insrsid9141455 }{\insrsid4422842 (a) that any property in}{\insrsid3544375 }{\insrsid4422842 dispute}{\insrsid3544375 in a suit is in danger of being wasted, damaged, or alienated by any party to the suit, or wrongfully sold in execution of a decree, or (b)\'85\'85\'85\'85\'85\'85\'85\'85\'85\'85\'85 }{\insrsid9141455 }{ \insrsid3544375 the court may grant a temporary injunction t o restrain such an act, or make such other order for the purpose of staying and preventing the wasting, damaging, alienation, sale, removal, or disposition of the property as the court thinks fit until the disposal of the suit or until further orders. \rquote \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid4422842 \hich\af0\dbch\af0\loch\f0 5.\tab}}\pard \ql \fi-360\li720\ri0\sl360\slmult1\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls1\adjustright\rin0\lin720\itap0\pararsid3682262 { \insrsid4422842 }{\insrsid3544375 Mr. Ebert Byenkya, learned counsel for the applicant, }{\insrsid1732057 submitted that this application is brought under Order 37 Rule 1 of the Civil Procedure Rules, and then went on to address court on the grounds set out herein above on which this application relies. }{\insrsid1389264 I sha ll return to these grounds later on}{\insrsid1732057 .}{\insrsid4422842 \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid1732057 \hich\af0\dbch\af0\loch\f0 6.\tab}}{\insrsid1732057 As will be seen on a perusal of the relevant rule it allows for applications of this nature where it is shown that any property}{ \insrsid15750412 in dispute}{\insrsid1732057 which is the subject matter of a suit is in danger of being wasted, damaged, alienated, or wrongfully sold in execution. Firstly it must be shown that the head suit is one }{\insrsid15750412 the}{ \insrsid1732057 subject matter }{\insrsid15750412 of which }{\insrsid1732057 is property}{\insrsid15750412 in dispute}{\insrsid1732057 . Secondly that property must be in danger of wastage, damage, alienation or sale as the case may be by a party to the suit. These two conditions must be satisfied first before considering any of the grounds that were argued by Mr. Byenkya. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid1732057 \hich\af0\dbch\af0\loch\f0 7.\tab}The subject matter of the head suit is set out in paragraph 3 of the plaint. It reads,}{\insrsid9141455 \par }\pard \ql \li1440\ri1440\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin1440\lin1440\itap0\pararsid3682262 {\insrsid1732057 \lquote The plaintiffs\rquote action against the defendants is for an injunction against the defe}{ \insrsid9141455 ndant restraining it from interfering with the 1}{\super\insrsid9141455\charrsid9141455 st}{\insrsid9141455 plaintiff\rquote s sponsorship contracts with tobacco farmers in the Northern Region, procuring or attempting to procure the breach of the said contracts and also for an injunction restraining the defendant from participating as a buyer in the 2005 tobacco buying season. \rquote }{\insrsid1732057 \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid9141455 \hich\af0\dbch\af0\loch\f0 8.\tab}}\pard \ql \fi-360\li720\ri0\sl360\slmult1\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls1\adjustright\rin0\lin720\itap0\pararsid3682262 { \insrsid9141455 Clearly the subject matter of this suit is not about any property as intended under Order 37 Rule 1(a) of the Civil Procedure}{\insrsid15750412 Rule}{\insrsid9141455 s. This suit is not co ncerned with the probable wastage, damage, alienation or sale of any property in dispute. This suit is about interference with contracts}{\insrsid15750412 , }{\insrsid9141455 a matter that is governed by Order 37 Rule 2(1) of the Civil Procedure Rules.

\par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid15750412 \hich\af0\dbch\af0\loch\f0 9.\tab}}{\insrsid15750412 On that ground alone, of being brought u nder the wrong law, I dismiss this application with costs. However, in event that I am wrong, I will proceed to consider the merits of the application}{\insrsid3364981 , as if the same had been brought under the correct law}{\insrsid15750412 . \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid15750412 \hich\af0\dbch\af0\loch\f0 10.\tab}Mr. Byenkya submitted that the applicant had }{\insrsid1389264 made out a }{\insrsid15750412 prima facie case as it had shown that the respondent was not licensed to sponsor farmers or buy tobacco in the Northern Region under The Tobacco Control and Marketing Act, 1996, and the regulations made there}{\insrsid5052216 }{\insrsid15750412 under. On its affidavit in reply the res pondents had admitted to sponsoring some farmers which was illegal. He argued that illegality on the part of the respondent had been established, and therefore the applicant had a prima facie case established against the respondent. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid15750412 \hich\af0\dbch\af0\loch\f0 11.\tab}Secondly }{\insrsid5052216 Mr. Byenkya }{\insrsid15750412 argued that }{\insrsid5052216 the applicant had shown it would suffer }{\insrsid3682262 irreparable}{\insrsid5052216 injury as it sponsored thousands of farmers with inputs, and whenever one farmer was approached, a cause of action accrued to the applicant. It had been established that the respondent had engag ed in illegal activity of sponsoring farmers.}{\insrsid15750412 \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid5052216 \hich\af0\dbch\af0\loch\f0 12.\tab}}{\insrsid5052216 Thirdly that in case of doubt, the court should determine the balance of convenience, which in his view, tipped in favour of granting the injunction rather not granting the same. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid5052216 \hich\af0\dbch\af0\loch\f0 13.\tab}Mr. Robert }{\insrsid3682262 Bauti}{\insrsid5052216 , learned couns el for the respondent opposed the application. He argued that the applicant had not shown that it had a prima facie case against the respondent. It had failed to prove interference with the contracts in question. The applicant had not shown that its farme rs had failed to deliver tobacco to it. No proof of }{\insrsid3682262 irreparable}{\insrsid5052216 injury was established. He submitted that the respondents are new entrants to the tobacco industry, and they were sponsoring independent farmers, which was a pre- condition to obtaining a tobacco buying licence.}{\insrsid3364981 He prayed that this application should be dismissed.}{\insrsid5052216 \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid3364981 \hich\af0\dbch\af0\loch\f0 14.\tab}}{\insrsid3364981 I have examined the affidavit in support of this application together with the affidavit in reply thereto. The applicant claims to have sponsorship contracts with thousands of farmers but it has not named a single farmer with whom it signed such a contract. Secondly the applicant has not established, among the thousands of contracts it alleges to have made with farmers in the Northern Region, }{\insrsid1389264 a }{\insrsid3364981 single contract which has been interfered with in anyway, let alone, in such a way as to procure a breach of performance of the same by the farmer. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid3364981 \hich\af0\dbch\af0\loch\f0 15.\tab}In establishing a prima facie case, the applicant placed a lot of score about the illegality of the respondent\rquote s actions. He implored this court not to ignore the illegality in question, as courts do not traditionally condone illegality. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid3682262 \hich\af0\dbch\af0\loch\f0 16.\tab}}{\insrsid3682262 Illegality by itself, does not establish a prima facie case, in a civil case of interference with a contract. }{\insrsid3364981 The acts of illegality may amount to a crime but fail to be sufficient basis to conclude that a contract has been interfered with. The applicant has}{\insrsid1389264 not}{\insrsid3364981 established }{\insrsid1389264 the existence of }{\insrsid3364981 one single contract}{\insrsid1389264 ,}{\insrsid3364981 let alone }{\insrsid1389264 establishing }{\insrsid3364981 a contract that has been interfered with by the respondent. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid3682262 \hich\af0\dbch\af0\loch\f0 17.\tab}}{\insrsid3682262 The question of whether the applicant will suffer any irreparable damage can only likewise be answered in the negative. Having failed to establish a possible right that has been }{\insrsid1389264 breached or otherwise interfered with,}{\insrsid3682262 the question of damage}{ \insrsid1389264 , whether irreparable or not,}{\insrsid3682262 cannot arise. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid1389264 \hich\af0\dbch\af0\loch\f0 18.\tab}}{\insrsid1389264 As I am not in any doubt as to the failure of the applicant to show that it has a prima facie case or that it will suffer irreparable harm, it is not necessary to consider, where the balance of convenience lies. \par {\listtext\pard\plain\lang2057\langfe1033\langnp2057\insrsid3682262 \hich\af0\dbch\af0\loch\f0 19.\tab}}{\insrsid3682262 This application is without merit. It is dismissed with costs. \par }\pard \ql \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid3682262 {\insrsid3682262 \par Dated at Kampala this 4}{\super\insrsid3682262\charrsid3682262 th}{\insrsid3682262 day of October 2005. \par \par \par \par \par \par FMS Egonda-Ntende \par Judge \par }}