Damji Sidra v Damji Sidra and Others (Civil Appeal No. 60 of 1995) [1995] UGSC 39 (3 February 1995)

Full Case Text

# IN THE REPUBLIC OF UGANDA IN THE SUPREME COURT OF UGANDA

## **AT MENGO**

# (CORAM: WAMBUZI, C. J, ODER, J. S. C. AND KAROKORA, J. S. C.) CIVIL APPEAL NO. 60 OF 1995

#### **BETWEN**

#### **ROHINI DAMJI SIDRA**

#### ................

APPELLANT

AND.

**VIJENDRA DAMJI SIDRA** $\mathcal{L}$

1. FRENY DAMJI SIDRA

3. TARUN DAMJI SIDRA

:::::::::::

**RESPNDONDENTS**

(Appeal from the Ruling of the High Court of Uganda at Kampala (Mpagi - Bahigaine, J) dated 15.9.1995.

High Court Civil Suit No. 591 of 1990)

### JUDGMENT OF ODER, J. S. C.

This is an appeal against a dismissal of the appellant's application by the High Court, seeking a review of a Court ruling ordering her to deposit security for costs in a suit in which she was the plaintiff.

The brief facts of the case are that on 11.7.1990, the appellant instituted a suit against the respondents, seeking inter alia, orders to declare null and void an alleged will of the father of the appellant, the $2^{nd}$ respondent, the $3^{rd}$ respondent, and the husband of the 1st respondent. The testator, Damji Kara Sidpra, had died on March 19th, 1958 and probate of his will granted to the 1st respondent as his executrix on $24^{th}$ September, 1958.

The appellant is resident in India and the respondent are resident in Uganda.

The respondents (as the delendants in the appellant's suit) applied by chamber summons under Order 23 rule 1 of the Civil Procedure Rules, for orders requiring the appellant to provide security for costs in the suit. The application was heard and granted by Tsekooko, (as he then was) on 8.7.1994, who ordered that the appellant should provide shillings 3m/- as security of costs within lour months ofthe date lhe order.

The appellant was apparently dissatisfied with the order for security for costs and applied by Notice of Motion for review of that Order under 0.42 r. I (2), 0.48 rr. I and 2 of the CPR and ss. 83 and l0l ofthe Civil Procedure Act. The application for a review was unsuccessfirl, having been dismissed by lvlpagi-Bahigeine, J. on 25 9 1995. It is against that dismissal which the appellant has now appealed. Five grounds are set out in the memorandum ofappeal. They are the to eflect that:

- l. The learncd Judge erred in larv and in fact in lailing to take into account thc appellant's property in Uganda coming to her frr:nr the estate of hcr late brothcr Tarum Damji Sidpra. - 2. The learned Judge ened in finding that .;rere is no substantial propeny in Uganda belonging to the appellant that could be used by the respondents to recover ccsts in High Court Civil Suit No. 591 of 1990 in the cvent of the decision in thar case favouring the respondents. - l. The learned Judge failed to address herself to the merits ol the High Court Civil Suit No.59l of 1990 in order to ascedain the likelihood of the appellant's success in the suit. - 4. The learned Judge erred in fact is not addressing herself to the fact that security for costs was being used by the respondents as an oppressive mechanism designed to lrustrate the case of the appellant against the respondents. - 5. The learned Judge failed to address herself on the law of enforceability of Foreign Judgments under the Foreign Judgments (Reciprocal) Act by which Uganda and India have reciprocal arrangements.

The parties to the appeal presented their arguments in writing under Rule 97 of the Rules of this Court. Consequently they did not address the Court when the appeal was called for hearing on 3.2.199'l .

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in the estate. All the ten named beneficiaries (except the appellant) have given the second respondent, Vijendra Damji Sidpra, powers of attomey to administer the estate of the deceased brother. The donnes of the power of attorney and the 2nd respondent were entitled to 80% of the estate. The 2"d respondent has just obtained Lctters of Administration in July 1995 and was still in the process of calling in the estate and paying out debts. Contrary to what the appellant had said in her affidavits, not all the items of property enumerated by her belonged to, or formed part o[, the estate of the deceased brother. For instance, immovable property o Plots l6 and 18, George Street, and l4 Nakivubo Road, were sold offdunng the Iife time of,the deceased, and no longer formed part ofthe estate olthe deceased; Plot 107, Jinja Road belonged to Nyanza Garage Ltd; Plot l4l16 rvas registered in thejoint names ofthe 2"d respondent and the deccased, and income therelrom rvas being used to rehabilitate the larnily business. The deceased was a shareholder in Darnji Plantations Ltd. and Nyanza Garage Ltd. but as the businesses had got ruined alicr the explusion ol Asians lrom Uganda. income therefrom was still being uscd to rehabilitate the businesses, but the process rvas not yct complete. The appellant was an adult living in India permanently and was not at any marerial time, a dependant of the tjeceased brother, the 3'd respondent. In any case, as tlre . estate of the deceased was not yet administered, the appellant could not claim to be entitled to any share olthe same.

The 2'd respondent in his affidavit also said that the appellant's affidavits were full ol untruths and speculations and could not form the b:sis ofinterfering with order lor security for costs.

On the basis of these facts and submissions by both parties the leamed Judge made the following findings which is the basis ofthe complaints in the five grounds ofappeal:

> "Tunring lo lhe posilion at l@e I am 6j'ore lhal no securily Jor costs should be ordered if the respondenl. delendant has money of the applicatiorttp in his hands but the principle is that the plaintiff has to shot she has substantial assels vithin the jurisdiction, which can be reached by process, and if she vanls to escape this she is bound to shav that this property is ttot of a floaling, but afixed arul penna,renl nalure.

It is not sufficient to say she has the property here. She has to prove it. It is clear the property referred to by the applicant is not property of any fixed nature. It is not yet known what the Estate will be worth at the time of distribution. Her share might turn out to be insufficient to satisfy the costs if the action should be decided against her. But without in any way seeming to prejudge the case, it seems to me that the probabilities of the applicant/p succeeding are all the other way ... ... ... ... ... ... ... I have carefully looked at the Judge's ruling. It is clear the learned Judge took into consideration all relevant matters. He was alive to the authority of Namboro v. G. A. Kaala (1975) HCB 315 for the view that poor litigants should not be barred access to court because of poverty; that the applicant was ordinarily resident outside the jurisdiction and that her claim to property within the jurisdiction in the hands of the respondents was merely speculative, as it has not been vested yet.

*Finally, I sympathise with the applicant for the way she feels* about what she calls the apparent injustice of the order, but the learned Judge based it on well established principles intended to protect the defendants' interests in such situations. I must therefore refuse to interfere with such order and dismiss the application with costs."

Grounds one and two of the appeal are about the same point, namely, that the appellant has property in this jurisdiction which would meet the respondent's costs of the suit in the event that the suit fails. The respondents, in their written submission also said so.

In her submission in this regard the appellant repeats all that she has been saying in the lower Court. She has maintained that the estate of her late brother (the $3rd$ respondent) was entirely derived from that of their late father and that she is entitled to a share of her late brother's estate, because he died intestate. She estimates her share to be about Shillings 70m/- which, she contends, are not floating but fixed assets. This value has been increased on every occasion the appellant has had to state it. It is her contention that the assets due to her from the estate would be more than sufficient to meet the respondents' costs for the suit, should be decided against her, She relied on the case of Ebrard v. Gassier (1884) 28 Ch. 232. In support of her case in resisting the order for security for costs.

In their reply, the respondents supported the learned Judge's refusal to review the order for security for costs. They contended that the appellants' claim of a share in her brother's estate was too speculative to be regarded as a fixed asset in her possession. They also blamed her for the administrator's (the $2nd$ respondent's) failure, so far, to complete the administration of their late brother's estate. This was because the administrator's time was being taken by being involved in frivolous and unwarranted legal disputes brought by the appellant, instead of devoting his time in dealing with the estate.

The general principle which applies in cases of security for costs where the plaintiff lives outside jurisdiction was stated in the early case of Ebrad v. Gassier (1885) 28 ch. D. 232 by Bowen, L. J. at page 235 as follows:

> " The plaintiff being abroad were prime facie bound to give security for costs and if they desired to escape from doing so they were bound to show that they had substantial property in this country, not of a floating, but of a fixed and permanent nature, which would be available in the event of the defendants being entitled to the costs of the action."

The same principle was cited with approval by Greer, L. J at page 469 in Kevorkian v. Burney (No.2)(1937), 4 All E. R. 468. In Ebrard v. Gassier (supra), however, the general principle was not applied because one of the members of the firm which brought the action happened to be within the jurisdiction of the Court when their appeal against an order for security for costs was heard. The brief facts in the case are that an action was brought in England by a Merchantile Firm, all the members of which, were in America against a firm at Manchester. The defendant put in a defence and counter-claim, and then applied to the Judge for an order for the plaintiffs to give security for costs. The plaintiffs filed an affidavit stating that they, with other persons, carried on business at Manchester and that the firm there had assets amounting to 2000 pounds. The Judge refused the application. On appeal the plaintiffs produced an affidavit stating that since the order one of the plaintiff had come to Manchester for the purpose of carrying on the action. It was held by the Court of Appeal that the affidavit as to the property of the plaintiffs in England was ambiguous and was not sufficient to support the order of the Court below, but it was also held that as one of the plaintiffs had come to

England since the order was made, although for a temporary purpose, the defendants were not entitled to security for costs, and therefore, the order must be a{firmed.

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In Kevorkian v. Burnev (supra), the general principle was a.lso not applied, because the subject matter ofthe suit, a Statue purchased by the plaintiff from the defendant, was actually available within that Court's jurisdiction. The brief facts of that case were that ihe plaintiff who resided abroad, had purchased from the defendant for over 3000 pounds what was warranted to be an authentic Greek Statue olthe sixth century B. C. ln action for breach of warranty, wherein it was alleged that lhe Statue was spurious, application was made that the plaintiff should give security for costs. The Court had already made an order that the Statue, rvhich rvas deposited with a warehousing company within the jurisdiction of the Court, should not be removed without thc consent of the defendants. It rvas held by the Court of Appeal that as in the event of the plaintilf being unsuccessful in the action, the value of the Statue must be nrore than any ordcr lor lhc costs that could be made:rgainst hirn, therc ougllt to be no order for security for costs

'That case was an exceptional one in that the "propeny rvithin the jurisdiction" was the subject matter of the suit, and it was alleged by the plaintiffto be more or less rvorthless. As however, rhe delendant would only be entitled to his costs upon the lailure by the plaintiffto substantiate his allegations, which would mean that the properly rvould then be of considerable value, the order for security was refused. It must also be noted that the property was deposited within the jurisdiction and could not be removed without an order of the Court or the consent ol defendant.

In this connection, I think lhat reference must also be made to one of the leading early cases on the point. That is the case of llin a ir 's Trade Ma IE90 !!.\_D. ! There, a French Company appealed from an order for security for costs for which the respondents had apolied. The appellants showed that they had a branch business as Mineral Water Merchants in England which they carried on in leased premises, where they had stock in - trade worth pounds 12,000, plant houses, and vans worth about pounds 1200 and a large . amount ol book debts. The respondents contended that this was floating property easily removable and did not exempt the appellants from giving security. It was held that there was no reasonable doubt that the respondents, if the appeal was dismissed with costs, would find ample goods on which execution could be levied and that security ought not to be ordered.

Lord Halsbury, L. C. said on page 3:

"There is no such hard and fast rule as has been suggested, that because a person is resident abroad, he must necessarily give security for costs. His being so resident makes a prima facie case for requiring him to give security; but it is subject to a well known and ordinary exception that if there are goods and chattels of his in this country which are sufficient to answer the possible claim of the other litigant, and which would be available to execution the Courts will not order him to give security for costs."

The same principle is also stated in Halsbury's Laws of England; 3rd edition vol.9, page 300, to the effect that where it appears the proposed plaintiff does not reside within the jurisdiction of the Court a plaint, originating application or petition must not be entered until security for costs has been given to the satisfaction of the Registrar, and even though he may be temporarily resident within the jurisdiction, a person may be ordered to give security if he is ordinarily resident outside the jurisdiction.

In view of the provision of O.23, r.1 of our C. P. R., which are similar to those of Kenya and Tanzania, the general principle in question has been applied within East Africa, for instance, in the case of Farrab Incorporated v. Brian John Robson and Others (1957) E. A. 441. In that case Lewis J. relied on, inter alia, the case of in Re Appolinari's Company's Trade Marks (supra), and ordered for security for costs. The defendants in a suit filed in Kenya made an application for security costs under 0.25.r.1 (equivalent of our 0.23 r.1. of the C. P. $\frac{1}{2}$ R.) on the ground that the plaintiff was resident abroad. The Plaintiff was a corporation registered in Tangier having a place of business at Moshi, Tanganyika. The plaintiff opposed the application on the grounds that it owned substantial property in Tanganyika and that in view of the Judgments Extension Ordinance of Kenya and Tanganyika the defendants should be able to proceed against the plaintiff's property in Tanganyika should this be necessary. The defendants relied on a similar but unreported application for security for costs made in the Supreme Court of Kenya in 1957 in similar circumstances, where security was ordered in the sum ofpounds 500. It was held, inter ali4 that in so lar as the matter may be ofdiscretion that was a fit and propcr case to order security for costs.

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ln the instant case, the appellant is resident in India. This was part ofthe evidence accepted by the learned trial Judge who ordered hcr to give security for the costs; and was one of the factors on which Mpagi-Bahigeine, J. refused to review the order. Secondly, there appears to .be no question that the appellant does not posses any fixed property in this country. All that she is expecting to come to her as property is her alleged share in the estate of her deceased brother who died intestate, which eslate is not yet administered. In the circumstances it cannot be said with any certainty that she will receive any property from that estate and if so the value ofsuch property. Such prospects may be even worse than a floating prcperty.

The appellant contends that though she is resident in lndia she happened to be in Uganda lbr the purposes ot'her suit, relying on the case ol Ebrard v Gassier (supra). She says that because of her presence in Uganda, she should not havc been ordered to give security lbr costs.

I am unable to accept this argument, becausc. tirst I think thal tllc casc of Ebrard v. Gassicr (supra) is distinguishable from the instant case in that casc the plaintiff firm was carrying on some business in Manchester within the jurisdiction of the Cc.urt. In thc instant case the appellant carries on no business in Uganda. Secondly, I think that the decision in that case rvas an exception to the general principle which the authorities I have referred to have laid down. The issue ofwhether security for costs should be ordered, being a discretionary matter for the lor the Court, I think that the decision in Ebrard (supra) should be confined to the circumslances olthat case. It cannot, in my vierv, be applied to the instant case.

In the circumstances I think that grounds one and two of the appeal should fail.

Under ground three, the essence of the appellant's submission is that her suit has a good chance of success, because, the suit was based on fraud, namely that the Wilt alleged to have been made by her father and lor wltch probate was granted on 24.9.1958 was a forgery. Secondary her suit is not bound by section 26 ol the Limitation Act, which allows an action . based on fraud to be brought within 12 years after discovery of the fraud. The appellant contends that as she discovered the fraud in 18.11.1989, when she saw signed copy of the alleged Will of her late father, her suit is within the period of limitation. The fraud had been concealed from her during the whole of the intervening period 32 years until she saw a signed copy of the Will.

The respondents submitted that the appellant's criticism of the learned Judge under this ground is absolutely baseless because the learned Judge certainly did consider the merit of the appellant's suit and she concluded that the probabilities of its success were nil.

It is settled law that one of the factors a Court takes into account in considering whether or not to order security for costs against a plaintiff is the merit of his case. In the well known case of Sir Lindsay Parkinson & Co. Ltd. v. Triplan, (1973) 1. Q B 609, the Court of Appeal upheld a decision of Mars-Jones J., which he had refused to order security for costs against a company with limited liability. The Court of Appeal agreed with the learned Judge, inter alia, about the requirement that the plaintiff's case must have a reasonable possibility of success. The learned Judge had said at page 620:

> "In my judgement, where some reasonable assessment of the plaintiff's chances of success can be made at this interlocutory stage, and that must be comparatively rare, that would be relevant to the question of whether security for costs should be ordered, but not to the issue quantum of the security to be ordered except in so far as further discount might be called for in addition to that made for the possibility that the whole of the estimated costs might not be incurred."

At page 626, Denning M. R., said "Mr. Levy helpfully suggest some of the ,matters which the Court might take into account such as whether the company's claim is bona fide and not a sham and whether the company has a reasonably good prospect of success. Again it will consider whether there is an admission by the defendants on the pleadings or elsewhere that money is due. The Court might also consider whether the application for security was being used oppressively -so as to stifle a genuine claim.

In the instant case, in accordance with the legal req uirement indicated in Sir Lind snY Parkinson (supra) and similar authorities, the leamed Judge considered the point, and came to the conclusion that the appellanfs case did not have a reasonable chance of success. In my judgement she rightly did so, because the suit challenged the validity ofthe will was instituted 36 years after the grant of probate. In the circumstances the appellant has, inter alia, the .obstacle of the period of limitation to resolve , before her action can succeed. The relevant provisions of the Limitation Act (Cap. 90) are probably section 21, which limits the period of aaion claiming personal estate of a deceased person to twelve years; and section 26, which postpones limitation of period in cases of fraud. Due to such a postponement, the period if limitation does not begin to run until the plaintiff has discovered the fraud or could with reasonable diligence have discovcred it. The effect of this is that the appellant has to prove in order to benefit from the postponement ofthe period of limitation.

In the circumstances, I think that there is no merit in ground three ot'the appeal lt nlust therefore fail.

Similarly, I think that ground four of the appeal has no merit and nrust thil. 'the criticisrn ol' the learned Judge under this ground is completely unjustified because she, in fact. considered r.vhether the order lor security for costs rvas being used by the respondents to deny the appellant access lo the Court because ofpoverty. The learned Judge then referred to the case of Nambo ro v. Kaala (1975) IICB. 315 and , as I understand her ruling, ansrvered that question in the negative

In Namboro's case (supra) the plaintiffs sued the defendant (their legal Counsel in another suit) for damages lor professional misconduct when he failed to appear on their behalf in that other civil suit as he was instructed to do so: As a result of the defendant's failure to appear for the plaintiffs in Court, an exparte judgment rvas entered against them and they were ordered to pay damages, whereas they had a good defence to the suit.

The defendant applied to the High Court for an order requiring the plaintiffs to fumish security for costs under O.23 r.l of the CPR He did not deny having been brieled by the plaintiffs but justified his non-appearance at the hearing that the plaintiffs had not paid him instructions fees. In support of his application for security for costs the defendant stated that the plaintiffs had shown themselves to be in the liabit of not paying their debts and therefore, if their suit failed the plaintiffs would again neglect to pay his costs. The plaintiffs applied to have the application dismissed because it was brought by notice of motion instead of by chamber summons as set out in O.23, r.3 and secondly, that the defendant had failed to show that he had a good defence to the action.

Sekandi Ag. J. (as he then was) held inter alia, that;

- 1. The main consideration to be taken into account in an application for security for costs are: - $(a)$ Whether the defendant is being put to undue expense by defending a frivolous and vexatious suit; - That he has a good defence to the suit; and $(b)$ - $(c)$ That he is likely to succeed. Only after these factors have been considered would factors like inability to pay come into account. - 2. Mere poverty of a plaintiff is not by itself a ground for ordering security for costs. If this were so, poor litigants would be deterred from enforcing their legitimate rights through the legal process.

In the Porzelack K. G. v. Porzelack 1, All ER 1074, Sir Nicolas Crowne-Wilknison, V. C. said this from page 1079:

> "The next matter that I take into account is that, on he evidence before me, there is little doubt that if I order security on anything like the scale asked for, the plaintiff's action will, in fact, he stifled. It simply does not have the means to put up the money. It is always a matter to be taken into account that any plaintiff should not be driven from the judgment seat unless the justice of the case makes it imperative. I am always reluctant to allow applications for security to be used as measure to stifle proceedings."

In Sir Lindsay Parkinson (supra) Mars-Jones J. said on page 617:

"*The Court is always mindful of the possibility that an order for* security can become a weapon of oppression available to the strong to prevent the weak from getting access to the Courts or the arbitrator to have their claims properly adjudicated according to law. For that reason alone, I would not be prepared to make an order for security for costs in excess of the figure which the master arrived at, namely 1,500 pounds."

In the instant case the learned Judge applied the same principle to the case before her and concluded, rightly so in my view, that the order for security was not being used by the respondents as a measure of oppression to deny the appellant access to Court to have her suit adjudicated according to law.

Under ground five, the appellant submitted that since Uganda and India are members of the Commonwealth, the Foreign Judgments (Reciprocal Enforcement) Act, Cap. 48, would enable decrees in Uganda to be enforced in India. Due to such reciprocal arrangement, the respondents, if successful in the suit in this case, would enforce their decree against the appellant in India. Due to the same arrangement, it was contented, the Indian Courts in 1959 recognised the probate which was granted in Uganda.

The appellant relied on **Vallabhdas Hirji Kapadia v. T Laxmidas** (1960) EA 852 for these submissions.

In their reply the respondents submitted that the appellant had not produced any evidence to show that India is one of the countries to which the Act applies. Moreover, even if the Act applies to India, there is no evidence that the appellant has property in India against which the respondents would enforce a judgment obtained in Uganda.

In the case of **Vallabhdas Hirji Kapadia** (supra), the defendant applied for security for costs in the High Court of Kenya on the ground that the plaintiff was ordinarily resident at Zanzibar and outside the jurisdiction of the Court. The plaintiff submitted that no order should be made as by s.3 ofthe Judgment Enension Decree (Cap.23), Laws ofZanzibar, a decree obtained in any Court in Kenya could be transferred lo Zanzjbar for execution as if the decree had been obtained nZarutbar. It was held bu Edmonds, J. that:

- (D in view ofthe provisions ofthe Judgments Extension Decree of Zanzibar the evil against which the rule for security sought to guard largely disappeared; - (iD the defendant would be at no material disadvantage if successful, in taking steps to recover costs either in Zanzibar or Tanganyika, where the plaintiff also irad property.

With respect, I think that the decision in the case of Vallabhdas Hirii Kao:rdia (supra) is not applicable to the instant case, because, first, the Ugandan Act (Cap 48) provides for enforcement in Uganda of judgments passed in loreign countries rvhich accord reciprocal treatment ofjudgments given in Uganda for the purpose of facilitating their enforcernent in those countries. Under section I ol the r\ct, the lvlinister responsible must, by a statutory order, specify the Foreign countries to which this larv applies. Section 9 ol the Act also empowers the Minister, by statutory orders, to apply the provisions ol the Act to Commonwealth territories-

Secondly, no statutory orders appear to have ever been made to apply the provisions ol the Act to India. Moreover, there is no evidence that the appellant posses properry in lndia against which a judgment obrained by the respondents in Uganda would be enforced in India.

ln the circumstances ground five of the appeal has no merit and must fail

In the result, this appeal must fail, I would accordingly dismiss it with costs to the respondent in this Court and in the Court below.

Dated at Mengo this 1l'h day of April 1997.

## A. H. O. ODER, JUSTICE OF THE SUPREME COURT.

## I CERTIFY THAT THIS A TRUE COPY OF THE ORIGINAL.

**SALU-MUSENE** W REGISTRAR, SUPEME COURT.