Bunjo v Bank of Africa Uganda Limited & 3 Others (Constitutional Petition 23 of 2018) [2024] UGCC 19 (23 May 2024) | Subsidiary Legislation Constitutionality | Esheria

Bunjo v Bank of Africa Uganda Limited & 3 Others (Constitutional Petition 23 of 2018) [2024] UGCC 19 (23 May 2024)

Full Case Text

## THE REPUBLIC OF UGANDA

### IN THE CONSTITUTIONAL COURT OF UGANDA AT KAMPALA

(Coram: Richard Buteera - DCJ, Catherine Bamugemereire, Muzamiru M. Kbeedi, lrene Mulyagonja & Oscar John Khika, JJCC)

#### CONSTITUTIONAL PETITION NO: 0023 OF 2018

BUNJO AGNES :PETITIONER

### VERSUS

- 1. BANK OF AFRICA UGANDA LIMITED - 2. ROYAL AGRO CHEMICALS LIMITED

3. BUNJO JONATHAN RESPONDENTS

4. ATTORNEYGENERAL

## JUDGMENT OF MUZAMIRU MUTANGULA KIBEEDI. JCC

#### lntroduction

1l The Petitioner brought this Petition under Article 137(3) of the Constitution of the Republic of Uganda, 1995 and the Constitutional Court (Petitions and References) Rules, S. I No. 91 of 2005, seeking a declaration that Regulation 13(1 ) of the Mortgage Regulations contravenes Articles 44(c),26(1),31(1)and 139(1)ofthe Constitution of the Republic of Uganda 1995.

#### Backqround to the Petition

2l The Petitioner claims to be a legal wife of the 3d Respondent having gotten married to him customarily on the 31st August 1996 alGayaza, Madudu in Mubende District. She stated that she, and her children, are residents of Kadondozi zone in Kampala in the properties comprised in Kyadondo Block 216 Plots 44'14,391,44'13 and 3557 all located at Buye.

Page 1 of 18

- 3l The Petitioner filed High Court Civil Suit No. 114 of 2008 at the Land Division against the'1st,2nd and 3d Respondents seeking inter alia, a declaration that Regulation 13 of the Mortgage Regulations, S.l. No. 2 of 2012 is unconstitutional in as far as it fetters the right to a fair hearing, infringes on the rights of the family and ousts the jurisdiction of Courts of law. At the time of filing this Petition before this court in June 2018, the High Court suit was still ongoing. - 4l The Petitioner also filed a Miscellaneous Application No. 243 of 2018 in the High Court for an interim order of injunction, but it was dismissed on the 18th April 2018 by the Deputy Registrar on the ground that the Petitioner had not paid 30% of the value of the loan amounUproperty as required under Regulation 13 of the Mortgage Regulations ol 2012. She subsequently filed reference to the High Court Judge (Land Division) where she complained about the unconstitutionality of Regulation 13 of the Mortgage Regulations ol 2012. - 5l The Petitioner also filed this Petition challenging the Constitutionality of Regulation <sup>13</sup> of the said Regulations. - 6l ln her Petition, the Petitioner alleges that the requirement in Regulation 13 of the Mortgage Regulations of 2012 for any person to deposit 30% of the loan amount or of the value of the mo(gaged property before Court grants an order to stop any sale of the mortgaged property is unconstitutional in as far as: - (a) lt fetters the Petitione/s right to a fair hearing guaranteed under Article 44(c) of the Constitution on the right to a fair hearing; - (b) lt infringes on the property rights of spouses guaranteed under Article 31(1) and Article 26(1) in as far as it requires non-mortgagee consenting spouses to first deposit 30% of the loan amount or of the value of the mortgaged property before going to Court to protect their matrimonial property.

- (c) lt ousts the unlimited jurisdiction of the High Court in contravention of Article 1 39(1) of the Constitution. - (d) lt contravenes Article 44(c) of the Constitution on the right to a fair hearing. - 7l The Petitioner sought a declaration from this court to the effect that Regulation 13 of the Mortgage Regulations 0f2012 contravenes Articles 31(1), aa(c),26(1)and 139(1) of the Constitution and is therefore null and void. - 8l The Petition is supported by the affidavit of the Petitioner, Bunjo Agnes, sworn on 18th June 2018. - 9l On their part, the 1't and 4rh respondents filed Answers to the Petition in which they stated that Regulation 13 of the Mortgage Regulations, 2012 is not unconstitutional and contended that the Petition raised no issues or questions for constitutional interpretation by this court. The 1st Respondent's Answer to the Petition was supported by the Affidavit of Mr. Mark Muwonge, a State Attorney in the Respondent's chambers, dated 1't December 2022. The 4t, Respondent's Answer to the Petition was supported by the Affidavit of Mr. Fahad Mading Mwanga, a Legal Officer in the 1st respondent bank, dated 18th November 2022. The 2no and 3'o Respondents did not file Answers to the Petition.

#### Representations

101 At the hearing of the Petition, the Petitioner was represented by Mr. Dan Mpiima, while Mr. Hilary Ebila, a Senior State Attorney in the 4rh Respondent's Chambers, appeared for the 4th Respondent. Leave was granted by the court to the parties to file Written Submissions as their respective legal arguments in this matter. However, at the time of writing thisludgment, only the Petitioner and the'1st and 4th Respondents had filed their respective Written Submissions. This judgment has therefore been prepared largely on the basis of the said Written Submissions.

#### lssues for Resolution:

- 11] lt is apparent that no issues were agreed upon by the parties at the commencement of the trial. But from the pleadings and written submissions of the parties, the issues for determination by this court are the following: - a) Whether the Petition discloses any question for constitutional interpretation. - b) Whether Regulation 13 of the Moftgage Regulations S./ No. 2 of 2012 is rnconsrstent wtth and contravenes Afticles 44(c),26(1),31(1) and 139(1)ofthe Constitution of the Republic of Uganda. - c) Whether the Petitioner is entitled to the remedies sought

#### Resolution:

# lssue ItJo. 1: Whether the Petition discloses guestions for Constitutional lnterpretation.

- 121 This issue arose from paragraph 2 of the 4th Respondent's Answer to the Petition in which he contended that the Petition is misconceived and raises no issues or questions for constitutional interpretation. - 131 ln his Written submissions, the 4t Respondent argued that the Petition is against <sup>a</sup> subsidiary legislation namely, the Mortgage Regulations o12012, and not the primary legislation, the Mortgage Act. That it does not show that there is an apparent conflict with the Constitution by an Act of Parliament which calls for interpretation of the Constitution by this Court. Counsel relied on the case of Mbabali Jude Vs Edward Kiwanuka Sekandi Constitutional Petition No. 28 of 2012 where Justice Kenneth Kakuru, citing with approval the cases of lsmail Serugo Vs Kampala City Council & Another Constitutional Appeal No.2 of 19981t9991UGSC 23 and Major General David Tinyenfuza, Supreme Court Constitutional Appeal No. 1 of 1997, observed Page 4 of 18

that not every violation of the Constitution or a validity of a claim must end up at the Constitutional Court.

- 141 The Petitioner disagreed and contended that the Petition does disclose questions for constitutional interpretation as set out in the remaining issues presented by the parties for resolution by this court. - 151 The question of whether a Petition discloses questions for Constitutional interpretation has been the subject of many decisions of this court and the Supreme Court of Uganda including Attorney General Vs Major General David Tinyenfuza, Supreme Court Constitutional Appeal No. 1 of 1997; lsmail Serugo Vs Kampala City Council & Another Constitutional Appeal No. 2 of 1998 [1999] UGSC 23; Charles Kabagambe vs Uganda Electricity Board Constitutional Petition No, 2 of 1999; and Centre for Domestic Violence Prevention & I others Vs Aftorney General of Uganda, Constitutional Petition No.13 of 2014 - 161 lt is now settled that a Petition under Article 137 of Constitution meets the criteria if it shows on its face that interpretation of a provision of the Constitution is required in relation to an impugned law, act or omission of any person or authority and seeks a declaration to that effect. - 171 I have carefully considered the Petition in the instant matter, together with the Affidavit in support of the Petition. The discernible question raised by the Petition is whether Regulation 13 of the Mortgage Regulations o12012 contravenes Articles 31(1), 44(c), 26(1) and 139(1) of the Constitution of the Republic of Uganda, 1995. lt then concludes by seeking declarations to that effect. This rendered the Petition meet one of the critical yardsticks for ascertaining whether a Petition raises a question for constitutional interpretation as out by Mulenga, JSC in Ismail Serugo Vs. Kampala City CouncilConstitutionalAppeal No.2 of 1998 (SC] thus:

"A petition brought under Aticle 137 (3) of the Constitution sufficiently dlsc/oses a cause of action if it describes the act or omlsslon complained of and shows the provision of the Constitution with which the act or ornisslon is alleged to be lnconsistenf or which is alleged to have been contravened by the act or ornlssron and pray for a declaration to that effect,"

- 18] The major ground of objection to the Petition raised by the 4tt Respondent is that the Petition is challenging a subsidiary legislation and not the primary legislation, the Mortgage Act itself. The 4ti, Respondent seems to suggest that an issue that calls for interpretation of the Constitution by the Constitutional Court arises only when there is an apparent conflict with the Constitution by an Act of Parliament and not a subsidiary legislation. - 191 I have closely reviewed Article 137 of the Constitution from which the jurisdiction of this cou( stems. As far as relevant to this matter, it provides thus:

#### "137. Questions as to the interpretation of the Constitution.

- (1) Any question as to the interpretation of this Constitution shall be determined by the Cout of Appeal sitting as the Constitutional Coufi. - (2) When sitting as a Constitutional Court, the Courl of Appeal sha// consist of <sup>a</sup> bench of five members of that court. - (3) A person who allegesthat - a. an Act of Parliament or any other law or anything in or done under the authority of any law; or - b. any act or omission by any person or authority,ls lnconslslenl with or in contravention of a provision of fhls Constlfution, may petition the Constitutional Court for a declaration to that effect, and for redress where appropriate.

(4) Where upon determination of the petition under clause (3) ot this article the Constitutional Courf conslders that there is need for redress in addition to the declaration sought, the Constitutional Coui may-

a. grant an order of redress; or

- b. refer the matter to the High Court to investigate and determine the appropriate redress. - 201 Nowhere is it stated in the above provision of the Constitution that subsidiary legislations are excluded from the justiciability by this court. On the contrary, the wording of Article 137 (3) (a) of the Constitution is wide enough to encompass issues about the constitutionality of 'an Act of Parliament or any other law or anything in or done under the authority of any law', ln my opinion "any other lal' includes subsidiary legislation. Additionally, in the instant Petition, the Petitioner has pointed out the provision of the Statutory lnstrument that is alleged to be inconsistent with the Constitution and the provisions of the Constitution which are alleged to have been contravened. - 211 Accordingly, I am satisfied that the Petition in this matter is properly before this court. <sup>I</sup> would therefore answer issue one in favour of the Petitioner.

# lssue 2 - Contravention of Articles 44(c),26(1) and 31(1) of the Constitution by Regulation 13 of the Mortgage Regulations of 2012

#### The Petitioner's submissions

221 lt was the Petitione/s submission that in as far as Regulation 13(1) and (6) of the Mortgage Regulations S.l No. 2 of 2012 makes it mandatory for the mortgagor, spouse, agent of the mortgagor or any other interested party to first pay a security deposit of 3070 of the forced sale value of the mortgaged property or the outstanding amount before that person can apply to Court for an order to adjourn or stop a sale by public auction, then it has the unconstitutional effect of preventing any party aggrieved by the intended sale of the mortgaged property from accessing justice and therefore inconsistent with Article 44 (c) of the Constitution. The Petitioner relied on the Tanzanian case of Ndyanabo Vs. Attorney General (2001) 2 EA 485 (cited with approval in SCCA No. 2 of 2009 Uganda Projects lmplementation and PaSe 7 of 18

Management Centre Vs. Uganda Revenue Authority where it was held that access to Court is one of the most fundamental rights in a free and democratic society.

- 23) Additionally, the Petitioner submitted that Regulation 13 of the Mortgage Regulations has the disastrous effect of determining the liability of the mortgagor before and without affording him a hearing, because the mortgagor is under a mandatory obligation to pay the 30% of the forced sale value of the mortgaged property or the outstanding amount before being heard. That this is in contravention of Article 28(1 ) of the Constitution of the Republic of Uganda. - 241 Secondly, the Petitioner contended that Regulation 13(1) of the Mortgage Regulations S.l No.2/2012, has the unlawful effect of binding non-consenting adults to money lending transactions and loan agreements to which they were not parties; an effect that is not only arbitrary, discriminatory but also unreasonable and unjustifiable in a free and democratic society. That this requirement is inconsistent with Articles 26(1) and 31(1) of the Constitution of the Republic of Uganda to the extent that it unjustifiably bars any person inclusive of the Petitioner who is the 3,0 Respondent's spouse from accessing Court to seek legal redress and protect her constitutionally guaranteed right to prope(y as envisaged under Article 26(1) of the Constitution, as well as to equal rights at, in and during marriage and at its dissolution. - 251 The Petitioner implored this court to find the impugned regulation unconstitutional.

#### The reply of the 1\* Respondent

261 ln reply, 1,t Respondent opposed the Petitione/s submission that Regulation 13 (1) and (6) of the Mortgage Regulations was unconstitutional and contravened Article 44(c) of the Constitution. The 1st Respondent submitted that the impugned Regulation does not fetter the right to a fair hearing because the mere fact that the Petitioner was allowed to file the application for interim and temporary injunction and was given

Page 8 of 18 audience to present her case before Court is already fulfilment of the right to a fair hearing. That the right to a fair hearing does not extend to the remedies/reliefs as these are within the discretion of Courts of Law having evaluated the evidence on record.

- <sup>2711</sup>Further, the 1sr Respondent submitted that Regulation 13 of the Mortgage Regulations,2012 was about balancing the different legal interests in the mortgaged properties by the parties. That Regulations 13(1) and (6) are intended to protect a bonafide mortgagee from frivolous objections, vexatious and fraudulent claims by the mortgagor/third parties that are intended to defeat the mortgagee's interest, rights and remedies available to the mortgagee under the mortgage laws and that it was also intended to guarantee that the mortgagee will not be unnecessarily prejudiced by any delays in payments that are inevitably occasioned by litigation. The 1st Respondent cited the case of i/akafo Margaret vs. Housing Finance Bank Limited (Civil Appeal No.687 of 2021\_lo support this proposition of balancing rights of the mortgagor and third party interests in the mortgaged property. - 281 Additionally, the 1't Respondent submitted that Regulation 13(1) of the Mortgage Regulations,2012 was not mandatory as alleged by the Petitioner because, under Regulation 13(6), the discretion is conferred upon the Courts to determine whether or not the 30% requirement should be imposed. That the wording of Regulation 13(6) of the Mortgage Regulations, connotes the discretionary nature and powers that it gives Courts while dealing with Mortgaged properties. - 29) lt was the 1st Respondent's final submission on this issue that the Petitione/s allegations were misguided and misconceived with regard to the applicability of Regulation 13 of the Mortgage Regulations, 2012 and interpretation of article 44(c) of the Constitution, 1995

301 With regard to whether Regulation 13(1) of the Mortgage Regulations, 2012 is inconsistent with Articles 26(1) and 33(1) of the Constitution, the 1\$ Respondent submitted that Article 26(1) of the Constitution does not confer a non-derogable right. That when a mortgagor pledges his/her properties as security for a loan, the Mortgagee equally acquires an interest and rights in the mortgaged property until full payment of the loan obligations of the mortgagor/discharge of such obligations. The Respondent concluded that therefore, if the mortgage is paid and the Mortgagee's interests in the property is extinguished, then the Petitioner could have her interests reinstated.

### The Reply of the 4th Respondent

- 311 The 4rh Respondent submitted that Regulation 13(1) of the Mortgage Regulations, 2012, does not allow discrimination or inequality in treatment in as far as both the Mortgagor and mortgagee are allowed equal access to court to apply for and oppose an application to stop the sale of mortgaged property. That any order of payment under Regulation 13 is made after hearing of both parties. - 321 Furthermore, the 4th Respondent submitted that while the requirement to pay the 30% deposit at the time of stopping a sale may occasion difference in treatment between the mortgagor and mortgagee, it amounts to a valid restriction under Article 21 , which is allowed under Article 43 in order to ensure balance between the rights of the parties. - 331 The 4t Respondent submitted that Regulation 13 (1) applies equally to all mortgagors. That the fact that some mortgagors may not be able to raise the 30% deposit amount does not necessarily infer discrimination against them since all mortgagors voluntarily pledge their property and unde(ake to lose it in the event of default.

- 341 The 4tt Respondent argued that a Mortgagor is entitled to apply to court for relief from paying the deposit and the Court can grant that relief if in its discretion it deems it fit under Regulation 13(6) of the Mortgage regulations, 2012. - <sup>351</sup>As to the alleged contravention of Article 44(c)of the Constitution by Regulation 13(1) of the Mortgage Regulations, 2012, it was the 4tr Respondent's submission that the impugned Regulation does not deny the right of access to Court, and is therefore not inconsistent with the right to a fair trial as guaranteed under article 28 or 44 (c) of the Constitution. Counsel opined that Regulation 13(1) of the Mortgage Regulations intends to balance both the rights of the mortgagee to recover amounts owed by way of sale of the mortgaged property, vls-ri-vis the mortgago/s right to access court and dispute or stop such sale by a mortgagee as was noted by Justice Mubiru in Housing Finance Bank Limited Vs. Silk Events Bank Limited and Anor (op cit). - 361 With regard to the impugned regulation's contravention of the right to property enshrined under Article 26 of the Constitution, the 4th Respondent submitted that there is no such contravention as the mortgagor voluntarily mortgages the property as security to be sold in the event of default. Furthermore, that the 30% deposit does not curtail a mortgago/s right to redemption, and thus does not deprive the mortgagor of property. - 371 The 4m Respondent concluded by praying that this Court resolves that Regulation <sup>13</sup> of the Mortgage Regulations No.2 of 2012 does not contravene the impugned Articles of the Constitution as alleged and dismisses the Petition with costs to the Respondents.

# Resolution of issue 2

## Contravention of the right to a fair hearing

- 381 Article 44(c) of the Constitution prohibits the derogation from the enjoyment of the right to fair hearing. lt is the contention of the Petitioner that the impugned regulation fetters the right to fair hearing which is a non derogable right under Article 44(c) of the constitution in as far as it requires any person to first deposit 30% of the forced value of the mortgaged property or outstanding loan amount before going to court to stop any sale of the mortgaged property. - 391 Regulation 13(1) of the Mortgage Regulations S.l No. 2 o12012, provides as follows: -

"13, Adjournment or stoppage of sale.

- 1. The coui may on the application of the mortgagor, spouse, agent of the moigagor or any other interested pafty and for reasonable cause, adjourn a sale by public auction to a specified date and time upon payment of a security deposit of 30% of the forced sale value of the molgaged propety or outstanding amount. - 2. The person conducting the sale may, upon notifying the moftgagor, moftgagee and bidders in witing, adjourn the sale to a specified date and time. - 3. The person conducting the sale shall specity the reason for adjourning the sale under sub regulation (2). - 4. Where a sa/e ls stopped or adjourned at the request of the mofigagor, an agent of the moftgagor, fhe spouse of the molgagor or any other interested paty, the noftgagor, agent or spouse of lhe moftgagor or that interested paty shall, at the time of stopping or adjourning the sale, pay to the person conducting the sale, a security deposit of 30% of the forced sale value of the moigaged property or the outstanding amount, whichever is higher. - 5. Where the sa/e ls stopped or adjourned at the request of the motgagor for the purposes of redemption, the morlgagor shall at the time of stopping or adjourning the sale pay a security deposit of 50% of the outstanding amount. - 6. Notwithstanding sub-regulation (1) where the application is by the spouse of <sup>a</sup> mofigagor, the court shall determine whether that spouse sha// pay the thirty perce nt secu rity d e posit.

- 7. Where a sa/e is adjourned under this regulation for a period longer than fourteen days, a fresh public notice shall be given in accordance with regulation 8 unless the mortgagor consents to waive it. - 8. A sale shall be stopped where before the lot is called- - a. the moftgagor pays to the person conducting the auction, all the money owing to the noftgagee, including the costs of the sale; or - b. where the person conducting the sale is satrsfed that all the money owing to the mortgagee, including lhe cosfs of the sale has been paid into the coutl which ordered the sale." - 401 lt is apparent that the Petitioner misconstrued the time at which the requirement to pay the 30% deposit arises under Regulation 13 of the Mortgage Regulation to be "before going to courl'. When sub rule (4) of REulation 13 is read together with sub rule (1) of the Regulation 13, it becomes apparent that the requirement to make the 30% deposit arises 'at the time of stopping or adjourning the sale" by the court. ln an ordinary suit, this is at the stage the trial court grants an injunctive or similar orders against the threatened sale of the mortgaged property by the mortgagee pending the resolution of the main suit on its merits. - 41) The issue of the alleged breach of the right to a fair hearing by the impugned Regulation was resolved by this court in the case of Ferdsult Engineering services Limited and Another (Constitutional Petition 18 of 2021) [2023] UGCC tOS (6 October 2023). By the unanimous decision of the court, it was held that the impugned regulation does not contravene the right to a fair hearing guaranteed by Articles 28 and 44 of the Constitution. Cheborion - Barishaki, JCC, who wrote the lead judgment with which all the other justices concuned, stated the reason thus:

"A reading of Regulation 13 (1) and (5) of the Moftgage Regu/ailons indicates that court wiil only stop or adjourn the sale of moftgaged propefty upon payment of a security deposit of 30% of the forced sale value of the molgaged propefty or outstanding amount and 50% of the outstanding amount where the morlgagor reguesfs couft to stop or adjourn the sale for purposes of redemption. Section 33 of Mortgage Act and Reg. 13(1) and (5) of the Moftgage Regulations fulher grant the molgagor an oppotunig to go to couft and be heard on why the sale should not go Page 13 of 18

on and also to request to redeem his property. Courl ought to strike a balance between the ights of the nolgagee and those of the moftgagor who at all times reserves the right to redeem his propety."

421 The decision of this court aforesaid is still good law and we find no reason to depart from it.

### Contravention of the property rights of spouses

- 431 The Petitioner also alleges that Regulation 13 of the Mortgage Regulations is inconsistent with, and in contravention of, Articles 26(1) and 31(1) of the Constitution in so far as it requires non- consenting spouses to first deposit 30% of the loan amount or of the value of the mortgaged property before going to court to stop any sale of the mo(gaged property. - 44) As I have already stated in this judgment, the impugned Regulation requires the 30% deposit to be made at the time of stopping or adjourning the sale of the mortgaged property by the court, and not before a spouse has gone to court as alleged by the Petitioner. - 451 Article 26(1) of the Constitution guarantees the property rights of parties in the following terms:

"Every person has a right to own propeiy either individually or in association with others."

461 On the other hand, Article 31 (1) of the Constitution is couched as follows:

" A man and a woman are entitled to marry only if they are each of the age of eighteen years and above and are entitled at that age -

- (a) To found a family; and - (b) To equal ights at and in marriage, during maniage and at its dissolution.' - 471 The claim of alleged breach of the right to property guaranteed by Article 26 of the Constitution by the impugned Regulation was likewise considered in the case of

Page 14 of 18

Ferdsult Engineering Seryices Limited and Another (op cit) and reyected by the unanimous decision of this cou(. The reasons were set out in the lead judgment of Cheborion, JCC, thus:

'... although Article 26 of the Constitution protects the ight of every person to own propety, it was not promulgated for the purpose of addressing dlsputes between pivate pafties aising out of contractual relationships. ln the instant case the nghts of the paties are governed by the contractual document ln thls case the Mortgage Deed and as a result infringement of Aticle 26 of the Constitution does nof anse.

The Motgage Act and the Moftgage Regulations clearly specify that the remedies of sale of mortgaged Nopefty may only be exercised in cicumstances where the mortgagor is in default of thei obligations under the moftgage deed. Section I of the Moftgage Act provides that;

'Motgage of land to take effect as security only.

1) On and after the date of the commencement of this Act, a mortgage shall have effect as security only and shall not operate as a transfer of any interest or right in land from the molgagor to the moftgagee; but the mortgagee shall have, subject to this Act, all powers and remedies rn case of default by the molgagor and be sublect to all the obligations confened or implied in a transfer of an interest in land subject to redemption."

Whereas a mortgagor may lose mortgaged propety, such a /oss will only occur where a moftgagee may exercise its remedies following a moftgagols default of their obligations which in my view, ls cons/stent with Article 26 of the Constitution because the moigagee a/so has interest in the notgaged propefty which interest ls protected as a propietary right."

- 481 The above statement of the law is still good, and I find no reason to depart from it. - 491 Regarding the specific allegation that the impugned Regulation breaches Article 31(1) of the constitution in so far as the Regulation binds non-consenting spouses to money lending transactions and loan agreements to which they are nonparties and not signatories, I note that Article 31(1) of the Constitution guarantees equal rights to spouses at and in marriage, during marriage and at its dissolution. I am unable to accept the Petitione/s argument that the requirement to deposit the 30% binds non consenting spouses to money lending transactions and loan agreements to which they are nonpa(ies and not signatories, or otherwise contravenes the rights of the non-

Page 15 of 18

consenting spouse to equal rights to spouses at and in marriage, during marriage and at its dissolution as guaranteed by Article 31(1) of the constitution. Determination of the binding nature of the money lending agreements and transactions entered into without the consent of one's spouse is made at the end of the trial after the court has heard all the parties and considering all the merits of their cases. On the other hand, the 30% deposit is made during the interlocutory stage of the case by a party seeking stoppage or delay of a sale of the mortgaged property pending the hearing and disposal of the spouse's claim of rights on its merits. As observed by this court in

# Ferdsult Engineering Services Limited (supra) ;

'Regulation /3 strikes a balance between the competing desire of the moigagee to realize the secuity following default and that of the motgagor to have his or her day in Coufi on questions regarding the legality or propriety of events triggering that process whrlst lhe moftgagot pursues his or her various remedies."

501 The aforesaid notwithstanding, Regulation 13(6) of the Mortgage Regulations, 2012, gives court discretion to exempt deserving cases of spouses from the strict application of the requirement to make the 30% deposit, in the following terms:

> "Notwithstanding sub+egulation (1) where the application [for delaying or stopping or postponing a sale of mortgaged propetyl is by the spouse of a mortgagor, the court shall determine whether that spouse sha// pay the thifty percent security deposit."

- 511 Regulation 13 (6) of the Mortgage Regulations, 2012 is intended to allow the court, on a case by case basis, to balance the interests of the mortgagee and the bonafides of the mortgago/s spouse's claim of rights in the mortgaged property. This is especially pertinent where the property mortgaged is a matrimonial home or family land in respect of which the spouse's rights are protected by Section 3g (1) of the Land Act. - 52) ln the result, it is my finding that the Petitione/s allegation of breach of Article 31(1 ) of the Constitution is unfounded. # Article 139(1) of the Constitution - lnterference with the iurisdiction of the Hiqh Court

- 531 The Petitioner also alleges that lhe requirement in Regulation 13 of the Mortgage Regulations to make the 30% deposit takes away the jurisdiction of the High court in all matters by requiring any person to first deposit 30% of the loan amount or of the value of the mortgaged property before going to Court which is inconsistent and in contravention of Article 139(1)of the Constitution. - 541 Article 139 of the Constitution is coached as follows:

# 139 Jurisdiction of the High Court

- ( 1) The High Court shall, subject to the provislons of thrs Constitution, have unlimited original jurisdiction in all matters and such appellate and other jurisdiction as may be conferred on it by this Constitution or other law. - (2) Subject to the provisions of this Constitution and any other law, the decisions of any court lower than the High Cout shall be appealable to the High Court. - 551 The Petitloner has not demonstrated how Regulation 13 interferes with the jurisdiction of the High Court. As I have already stated in this judgment, the High Court still retains the jurisdiction to hear and dispose of disputes relating to mortgages on their merits. lt is only where a party seeks to stop or delay the sale of the mortgaged property pending the disposal of the main suit that the requirement of the 30% deposit sets in. And as already stated, this is to balance the competing rights and interests of the several pailes in the same mortgaged property and guard against abuse of the interlocutory remedy of delay or postponement of the sale of mortgaged property. But even here, the court still has the discretion under Regulation 13(6) to exempt a spouse from the rigours of the strict application of the requirement to deposit the 30%. All this is, in itself, evidence that the High court's original jurisdiction has not been ousted by the impugned Regulation as alleged. As such, I would resolve this issue in the negative.

# Remedies

- 561 Having answered in the negative all the allegations of breach of the Constitution made by the Petitioner, I would accordingly dismiss the petition. - 571 I would make no order as to costs as the Petition was of public benefit in so far as it sought judicial clarity and guidance on issues of great public importance.

Delivered and dated at Kampata ns ..23.?oay ot .....tt] 2024

MUZAMIRU MUTANGULA KIBEEDI JUSTICE OF THE CONSTITUTIONAL COURT

# THE REPUBLIC OF UGANDA

# IN THE CONSTITUTIONAL COURT OF UGANDA AT KAMPALA

Coram:

[Buteera - DCJ, Bamugemereire, Kibeedi, Mulyagonja, Kihika, JJCC]

# **CONSTITUTIONAL PETITION NO: 0023 OF 2018**

BUNJO AGNES::::::::::::::::::::::::::::::::::::

# **VERSUS**

- 1. BANK OF AFRICA UGANDA LIMITED - 2. ROYAL AGRO CHEMICALS LIMITED - 3. BUNJO JONATHAN

4. ATTORNEY GENERAL

::::::::::::::::RESPONDENTS

# JUDGMENT OF CATHERINE BAMUGEMEREIRE JCC

I had the opportunity to read, in draft, the opinion of my brother Muzamiru M. Kibeedi, JCC. I agree with his reasoning and conclusion. In the result, I would agree that this petition does not raise a controversy requiring the interpretation of the Constitution. I would agree that the petitioner is at liberty to exhaust the remedies available, if any, under article 50 of the Constitution. I would dismiss this petition with no order as to costs.

Catherine Bamugemereire Justice of the Constitutional Court

#### THE REPUBLIC OF UCANDA

#### IN THE CONS'TITUTIONAL COURT OF UCANDA AT KAMPALA

(Coram: Riclnrd Buteera - DCl, C.atleine Bamugemereire, Muztniru M. Kibeedi, Irene Mulyagonjn & Oscar lohn Kihikn, IICC)

#### CONSTITUTIONAL PETITION NO: 0023 OF 2018

BUNJO ACNES: PE'IITIONEIT

#### VERSUS

1. BANK OF AFRICA UGANDA LIMITED

- 2. ROYAL AGRO CHEMICALS T,IMITED - 3. BUNJO IONATHAN - 4. ATTORNEYGENERAL

RESPONDENTS

#### JUDGMENT OF OSCAR JOHN KIHIXA, JCC

I have had the benefit of reading in draft the judgment of Hon. Justice Muzamiru M. Kibeedi, JCC. I agree with the reasoning and conclusion that Regulation 13 of the Mortgage Regulations of 2012 does not contravene the provisions of the Constitution of the Republic of Uganda.

I would accordingly dismiss the Petition with no order as to costs.

z-D Dated this .. ... Q?.'....d^u nf // / 2021.

V

KIHIKA IUSTICE OF THE CONSTITUTIONAL COURT

# THE REPUBLIC OF UGANDA

## IN THE CONSTITUTIONAL COURT OF UGANDA AT KAMPALA

(Coram: Richard Buteera, DCJ, Catherine Bamugemereire, Muzamiu M. Kbeedi, lrene Mulyagonja & Oscar John Khika, JJCC)

# CONSTITUTIONAL PETITION NO: 0023 OF 2018

BUNJO AGNES PETITIONER

### VERSUS

- 1, BANK OF AFRICA UGANDA LIMITED - 2. ROYAL AGRO CHEMICALS LIMITED - 3. BUNJO JONATHAN - 4. ATTORNEY GENERAL

RESPONDENTS

# JUDGMENT OF IRENE MULYAGONJA. JCC

I have had the benefit of reading in draft the judgment of my brother, Muzamiru Mutangula Kibeedi, JCC. I agree with his decision that the petition should be dismissed for the reasons he has given, with no order as to costs.

Dated at Kampala this 2-3 rrtnT <sup>2024</sup> day of

lrene Mulyagonja JUSTICE OF THE CONSTITUTIONAL COURT

## THE REPUBLIC OF UGANDA

# IN THE CONSTITUTIONAL COURT OF UGANDA AT KAMPALA

### **CONSTITUTIONAL PETITION NO.0023 OF 2018**

Coram: [Buteera-DCJ, Bamugemereire, Kibeedi, Mulyagonja, Kihika] [JJCC]

**BUNJO AGNES**

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**PETITIONER**

### **VERSUS**

1. BANK OF AFRICA UGANDA LIMITED 2. ROYAL AGRO CHEMICALS LIMITED 3. BUNJO JONATHAN 4. ATTORNEY GENERAL $\Rightarrow$ RESPONDENTS

# JUDGMENT OF RICHARD BUTEERA, DCJ

I have had the benefit of reading in draft the Judgment prepared by My Learned Brother Justice Muzamiru M. Kibeedi JCC.

I agree that the Petition ought to be dismissed with no order as to costs.

As all the other members of the Court agree with Kibeedi JCC, there will be orders in the terms proposed by the learned Justice of the Constitutional Court.

Dated this ....................................

Richard Buteera DEPUTY CHIEF JUSTICE