Eilor and Another v Soroti Distict Local Government and 2 Others (Civil Suit 2 of 2014) [2024] UGHC 341 (31 January 2024)

Full Case Text

The Republic of Uganda

In the High Court of Uganda Holden at Soroti

# Civil Suit No. 002 of 2014

1. Eilor Silver 10

2. Epau Stephen *(administrator of the estate of the late Adotu Gastavus)* ::::::::::::::::::::::::::::::::::::

#### Versus

# 1. Soroti District Local Government

#### 2. Registrar of Titles 15

3. Epecu Francis

**Respondents**

# Before: Hon. Justice Dr Henry Peter Adonyo

# Judgement

# 1) Introduction:

The plaintiffs' case against the defendants is for declarations and they seek the following reliefs;

a) Cancellation of certificate of title issued to the 3rd defendant by the 2nd defendant for having been procured fraudulently.

- b) A declaration that the purported sale and allocation of Block No. C6 & C8 (Plot No. 7A and 7B) off Engulu road, Eastern division, Soroti Municipality by the $1^{st}$ defendant to the $3^{rd}$ defendant was fraudulent for having been allocated in breach of principles, policies and regulations governing the acquisition of the suit property and that the 3rd defendant procured and facilitated the stated breaches; - c) A declaration that the $1^{\ensuremath{\text{st}}}$ defendant acted ultra vires its powers when it purported to allocate the suit property to the 3rd defendant. - d) A declaration that at the time of the purported allocation of the suit property by the 1st defendant to the 3rd defendant, the plaintiffs were and are sitting tenants on the suit property, and ought to have been given priority in allocation of the suit property. - e) A declaration that the 3rd defendant who had full knowledge of the plaintiffs' unregistered interests in the suit property, fraudulently procured his registration in respect of the suit property in order to defeat the plaintiffs' unregistered interests in the suit property. - f) A declaration that the purported sale and allocation of the suit property by the 1st defendant to the 3rd defendant is fraudulent and therefore null and void. - g) A permanent injunction to restrain the defendants by themselves, their agents or howsoever otherwise from entering and using the suit property or from dealing with the suit property in any way without the consent of the plaintiff. - h) An order for delivery up by the defendants of the duplicate certificate of title for purposes of cancellation

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- i) General damages - j) Exemplary damages for acting arbitrarily - k) Costs of the suit - 2) The Plaintiffs' case:

According to the plaintiffs, at the time of the divesture of the property they were sitting tenants and hence eligible to be given first priority in grant of allocation and 10 purchase of the suit property. That they applied for the grant of the suit property which applications were rejected on the basis that they had retired and instead the suit property was granted to the 3rd defendant.

Accordingly, the plaintiffs seek remedies indicated in its plaint against the defendant. 15

3) The $1^{st}$ and $3^{rd}$ Defendants' case:

The 1st and 3rd defendants (defendants) denied the plaintiffs' claim and averred that the plaintiffs were not sitting tenants and therefore not entitled to priority in the grant of the suit land. The 1st defendant avers that the suit property is its own and that it was quite different from the Central Government pool houses, having acquired the same from National Housing and Construction in the 1970s; therefore, it was not available for divesture under the 1996 Republic of Uganda Divesture and sale of Public Assets policy, Guidelines and procedures.

The Government Pool Houses were allocated to civil servants under the Ministry of Public Service and were sold way back in 1994 under a policy of the Ministry of Public 25 Service by Government Pool Houses Sales Committee. The suit property being owned by the 1st defendant, its council, was the rightful authority and in its sitting of 7th May 2001 resolved to sell the Local Government Houses and the same were

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- sold in 2006 based on an appropriate procedure by the House Allocation Committee. $\mathsf{S}$ The resolution to sale was passed when the plaintiffs were employees of the 1st defendant, but at the sale in 2006, the plaintiffs had retired and therefore ceased to be employees; consequently, they were not eligible to buy the suit properties. - That the 3rd defendant rightly applied and was granted the suit property by the 1st defendant. The 1st defendant contends it followed the right procedure in granting 10 the suit land to the 3rd defendant.

Arising from the above assertions, the defendant avers that this suit ought to be dismissed with costs.

# 4) Material facts agreed upon:

- From the Joint Scheduling Memorandum filed in this court on 04th June 2021, the 15 parties agreed to the following: - a) Agreed facts: - The plaintiffs were formerly civil servants attached to the 1st defendant and are in occupation of the suit land. - The 3rd defendant is the registered proprietor of the suit land whose interest the plaintiffs are challenging on grounds of fraud. - The suit property was sold off to the 3rd defendant by the 1st defendant which $\mathbf{L}$ sale the plaintiffs are challenging on grounds of fraud. - A resolution and modalities guiding the sale of the suit property were passed by the $\mathbf{1}^{\text{st}}$ defendant's agents. - By the time of passing the resolution, the plaintiffs were still in active civil service and by the time of issuing notice/modalities of sale, the plaintiffs had retired from civil service.

### b) Disagreed facts:

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- The issuing of the suit property to the 1st defendant was tainted with fraud. - The plaintiffs were sitting tenants on the suit property and entitled to priority in purchase of the suit property. - The $1^{st}$ defendant was a sitting tenant on the suit land. - The suit property was not part of the central government pool houses. 10

### 5) Representation:

M/s Engwau & Co. Advocates represented the plaintiffs, while the Attorney General's Office, Soroti, and M/s Ewatu & Co. Advocates jointly represented the 1st and $3rd$ defendants.

In proof of their case, the plaintiffs led Eilor Silver as PW1 and Epau Stephen as PW2.

The defendants led Oketayot Christopher James – the Deputy Chief Administrative Officer Soroti District Local Government, as DW1 for the 1st defendant and Epecu Francis as DW2 for the 3rd defendant.

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#### 6) Issues:

Four issues were agreed upon to resolve the dispute, and these are;

- a) Whether the plaintiffs or the 3rd defendant were sitting tenants on the suit land and eligible for $1^{st}$ priority? - b) Whether the suit property was part of the Central Government Pool houses?

c) Whether the 3rd defendant fraudulently obtained his registration as proprietor on the suit land?

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- d) What remedies are available to the parties? - 7) Burden and Standard of Proof:

Section 101 of the Evidence Act, Cap 6, provides that;

- 1) Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he or she asserts must prove that those facts exist. - 2) When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person.

Section 102 of the Evidence Act states that the burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on

- either side. 15 - Also, Section 103 of the Evidence Act provides that the burden of proof as the burden of proof as to any particular fact lies on that person who wishes the court to believe in its existence unless it is provided by any law that the proof of that fact shall lie on any particular person. - This being a civil suit, the burden of proof lies with the plaintiff (See: Sections 101 20 and 102 of the Evidence Act, Cap 6) to prove their case on a balance of probabilities. Also see: Nsubuga vs Kawuma [1978] HCB 307.

In the case of Erumiya Ebyetu v. Gusberito [1985] HCB 64, it was held that;

"where the plaintiff leaves his case in equilibrium, the court is not entitled to incline the balance in his favour. The plaintiff must prove his case against the defendant to the required standard."

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#### 8) Submissions:

Counsel for the plaintiffs and the defendants filed written submissions on the court record. The court is thankful to the parties for the submissions considered herein accordingly.

9) Resolution of issues:

Before I resolve the issues, the 2nd defendant did not file its written statement of 10 defence despite an affidavit of service filed on 27th April 2021 on the court record showing that they were served with summons to file a defence but did not.

The plaintiffs' counsel argued issues 1 and 3 jointly and issues 2 and 4 separately; however, I will resolve issues 1, 2 and 3 concurrently.

- 15 - a) Issues 1, 2 and 3: - Whether the plaintiffs or the 3rd defendant were sitting tenants on the suit land and eligible for $1^{st}$ priority?

- Whether the suit property was part of the Central Government Pool houses?

- Whether the 3rd defendant fraudulently obtained his registration as proprietor on the suit land?

It is not disputed that the plaintiffs worked for the 1st defendant and ceased to be employees of the 1st defendant, having retired from its service on 31st July 2005 for the 1st plaintiff and 31st December 2005 for the 2nd plaintiff.

In the plaint, they averred that they were allocated during their active service Block No C6 & C8 (Plot No. 7A and 7B) off Engulu road, Eastern division, Soroti 25 municipality, respectively.

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In evidence, PW1 testified that he lost the allocation letter, whereas PW2 testified $\mathsf{S}$ that he had deponed an affidavit in that regard, though he told the court that the CAO did not certify it. The plaintiffs testified that upon their retirement, they continued staying in the suit property because their severance payments had not yet been paid by the time of retirement and PW2 even testified that, up to date, the retirement benefits of his father had not yet been paid. 10

The contention of the plaintiffs, which this court must resolve, is between the 3rd defendant and the plaintiffs, who was entitled to first priority of purchase of the suit property and did the current owner, the 3rd defendant, obtain the ownership fraudulently?

PW1 and PW2 testified that the suit property belongs to the 1st defendant. They 15 testified that the resolution to sell the suit property was passed before they both retired, that is, on 7th May 2004 (PEX54) Resolution 11 of which reads;

> "The Council resolved that houses at Oderai Housing Estate be sold off. The modalities be drawn by the technical team."

According to the minutes, this resolution arose from a communication from the CAO 20 of the 1st defendant calling for the privatisation of the Oderai Housing Estate in line with the Government policy of divesting from owning houses as a local government.

The Soroti District Local Government House Allocation Committee, on behalf of the 1st defendant, came up with modalities in a letter dated April 13, 2006 – PEX47.

The modalities for the sale of the district administration houses listed terms and 25 conditions for the intending applicants to purchase the house ought to have met.

PW1 testified that according to the modalities, he was not eligible to purchase the $\mathsf{S}$ suit property.

The plaintiffs agree that they did not hand over the keys to the suit property on retirement, in line with Public Service Standing Orders upon retirement but retained the houses while awaiting their retirement benefits.

Each plaintiff also testified that they did not apply to purchase the suit properties 10 immediately before or immediately after retirement but that they did so later.

It is further a equally agreed fact that the plaintiffs still occupy the suit properties even when they did not have tenancy agreements to the same and that they continue occupying the same well even after retirement.

PW2 told the court that he did not dispute the modalities made by the 1st defendant. 15 PW2 testified that he applied to purchase the suit property (PEX59) whereas that is not the case as it is clear that he was merely reminding the 1st defendant of his intention to purchase the same.

The plaintiffs, as witnesses, told the court that they applied to be allocated or purchase the suit properties but that their applications were rejected because they 20 were no longer in active public service of the 1st defendant by the time of the modalities were issued.

They, however, stated they deemed themselves still sitting tenants arising from a valuation report by the Chief Government Valuer in a letter dated 6th January 2006 which listed them so. My close perusal of the Letter of the Chief Government Valuer - PEX45 indicates $\mathsf{S}$ that there was an inspection date was between September 2005 and on the 4th of November 2005. At that time the plaintiffs were still in active service and so their listing as sitting tenants was well expected, though the Chief Government Valuer did not indicate on which specific dates he inspected the suit properties. However, that document PEX45 alone is, in my view, not reasonable to use to assert being sitting 10 tenants as Section F-d of the Government Standing Orders provides that at retirement, a civil servant must hand over the government properties, unless held with permission, which was not in this case.

This position is confirmed by DW1 who testified that according to Section F-d of the Government Standing Orders, the plaintiffs on retirement ceased to be employees 15 of the $1^{st}$ defendant.

He testified further that Section F-d of the Government Standing Order demands that a retired officer hands over all government property in his possession, including keys to any house, where he/she is in occupation. He also testified that the refusal by the plaintiffs to hand over the keys to the suit property and their continuous

occupation of government property without permission of their employer was illegal.

He told the court that the suit property was rightly allocated and consequently sold to the 3rd defendant as it was deemed vacant by the 1st defendant in compliance

with Section F-D of the Government Standing Orders as thee previous occupants 25 had by law retired.

DW2 Epechu Francis, in his defence in cross-examination, testified that the plaintiffs' $\mathsf{S}$ refusal to hand over the suit property to the 1st defendant upon their retirement was a breach of Section F-D of the Government Standing Orders. He told the court that he became a sitting tenant when the suit property was allocated to him.

Further that, the suit property was sold to him upon its allocation to him as a serving civil servant and not a retired one.

I note that though according to PEX47, which is the modalities used in advertising and allocating the suit property, used the term "sitting tenant', that term is not defined.

The defendants' counsel resorted the Oxford Advanced Learner's Dictionary 8th edition on page 1389 which defines a sitting tenant "a person who is living in a rented 15 house or flat and who has the legal right to stay there".

The Merriam-Webster Online dictionary, similarly defines a sitting tenant as "a person who is living in a rented house or apartment and has the legal right to stay there."

- I adopt both definitions in respect of this matter and would state since the 20 unchallenged Section F-d of the Public Standing Orders provides that "... an officer leaving office temporarily or permanently was required to handover all government assets and equipment as the words used there is "shall handover......., this has the implication that one must comply. - Thus from the evidence herein, the plaintiffs retired from civil service of the $1^{st}$ 25 defendant and were required to comply with Section F-d of the Public Standing

- Orders and hand over the keys of the suit properties to the 1st defendant. They did $\mathsf{S}$ not do so on top admitting that they even did not have any tenancy agreement with the 1st defendant. This means that without the authorisation of the 1st defendant for them to continue being so in the premises then they were illegally occupying the same. - I note that also the plaintiffs also could not benefit from condition which provided 10 that the first priority purchase would be to sitting tenants for those which effected the sale of the houses became operational on 13th April 2006, a time when they had long ceased to be employees of the 1st defendant. They were already retired civil servants and that alone would disentitle them from being sitting tenants as the modalities required that the applicants to purchase the district administration 15 houses be those who were in service.

Although PW1 told the court that they complained to the Permanent Secretary of the Ministry of Lands, Housing and Urban Development - PEX39, PEX40 and DEX21(c)), but the letter of the Permanent Secretary dated 4th September 2013 to the Chief Administrative Officer where there was a complaint regarding inaccurate sale of the Oderai Housing Estate and wherein the Permanent Secretary also clarified to the CAO that the rightful authority for the divesture of the government houses was the Pool Houses Committee and not the district council or land board, the 1st defendant, properly through a letter dated 10th September 2013-DEX21(c), responded to the Permanent Secretary, clarifying that the Oderai Housing Estate belongs to it and was not part of the general Government Pool Houses.

There was even no reply to the 1st defendant's letter by the Permanent Secretary; moreover, and moreover the plaintiffs were not listed as complainants therein.

The 1st defendant also adduced evidence to show the acquisition of land from the $\mathsf{S}$ National Housing and Construction Corporation in the year 1979 as per DEX1-DEX20. According to PEX35, the Pool Houses Sales Committee Meeting deliberated on the appeal over the irregular sale of the Oderai Government Quarters, Soroti, by the sitting tenants by asking the Permanent Secretary to write a letter to the CAO which, according to the evidence adduced was replied to by the CAO in a letter dated 10th 10 September 2013 claiming that the said quarters were houses belonging to the 1st defendant and not part of the government pool houses.

In PEX35, in answer to an appeal by the tenants of plots 18/20 Amberley Road and 19/21 Faraday Road, Jinja, the Committee noted that the houses were in the jurisdiction of the Jinja Municipal Council and it was the one to decide on the mode 15 of sale just like the case here with the $1^{\ensuremath{\text{st}}}$ defendant which adduced evidence beyond a balance of probabilities showing that they were the owners of the suit properties and so the 1st defendant had every legal right to deal with its properties as it deemed fit, which it did through the modalities it issued that were developed by its technical team. 20

The 3rd defendant denied any fraud in acquiring the suit properties. He told the court that when he applied for the suit property, he indicated that he was a sitting tenant in accordance with DEX 51 which was a Notice to all Intending Applicants to purchase District House from Secretary House Allocation Committee Dated 13/04/2006 and that the CAO in Paragraph 2 of DEX 50 acknowledged that DW2 was a sitting tenant of the suit properties.

DW2 testified that by the time he applied for the suit property, he had already benefited for public service sale of property at Plot 6 Lalle Road. DW2 testified that

he had never accessed the suit property as a sitting tenant despite having an $\mathsf{S}$ allocation letter for the suit property -DEX40 and DEX49 which showed that he applied for allocation and was allocated the suit land on 11/05/2006.

DW2 told the court that he went ahead and paid the required premiums with the Valuation Report of Soroti District Local Government - PEX4B, indicating that on Plot 7A and 7B Egalu Road, Nos. 38 and 39, there were the names of Silver Eilor – 7A and

10 Gusta Adotu – 7B, who were in occupation at the time of the valuation.

That the suit properties' values were for 7A – 6m/- and 7B – 6m/-. DW2 testified that he paid for the suit property in instalments totalling to a total of about shs. 6m/plus. He testified that the Valuation Report (PEX 4B) was made on 30/12/2005, and the modalities took effect on 13/04/2006.

DW2 testified that the date of his offer and allocation is 11/05/2006, and the allocation was made by the Secretary Housing Accommodation Committee, and the offer of purchase was made by the Chief Administrative Officer. He told the court that he had a letter of allocation for the suit property and that it was first advertised to all staff, and he applied to be allocated the suit property, which was for Soroti District Local Council, and he was eligible as per the criteria which was; An employee of the District, on active payroll of the District, an allocation letter and Seniority in position.

DW2 testified that one was eligible to be allocated a house according to the criteria: Employee of the District, on active payroll, having an Allocation Letter, seniority and 25 an application for the same, among others.

- DW2 further testified that the District Council put up a notice that the suit property $\mathsf{S}$ was vacant and invited those eligible to apply according to their criteria. He also testified that by that time the plaintiffs had already retired and were not eligible, and their continued stay on the property was a breach of the Standing Orders of Civil Service Chapter 1 Section $F - D$ . - The plaintiffs contend that the 3rd defendant was fraudulent because he applied for 10 allocation of the suit properties well knowing that they occupied the same and that he lied about being a sitting tenant, yet he was not.

From my assessment above, correct to state that upon the retirement of the plaintiffs, they ceased to be responsible for the 1st defendant's properties and as such their continued in occupation of those properties was illegal since they were required to have handed over properties upon retirement.

I do not fault the 1st defendant to have advertised the suit properties as vacant and going ahead to allocate the same.

According to the case of Kampala Bottlers Ltd Vs Damanico (U) Ltd, SCCA No. 22 Of 1992, it was held that fraud must be strictly proved the burden being heavier than 20 one on a balance of probabilities generally applied in civil matters, it was further held that; "the party must prove that the fraud was attributed to the transferee. It must be attributed either directly or by necessary implication; it is the transferee who must be guilty of some fraudulent act or must have known of such act by somebody else and taken advantage of such act." 25

From my assessment of the facts above, it is thus my finding that fraud pleaded that the 1st and 3rd defendant committed in divesting the suit land has not been proved

because it is evident that the 3rd defendant followed the due process and bought $\mathsf{S}$ from the owner of the suit land, who is the 1st defendant who acted legally when it decided the modalities for sale of the suit property as its own property as per DEX 1, DEX 2, DEX 3, DEX 4, DEX 5, DEX 6, DEX 7, DEX 8, DEX 9, DEX 10, DEX 11, DEX 12, DEX 13, DEX 14, DEX 15, DEX 16, DEX 17, DEX 18, DEX 19 and DEX 20 which are annexures which indicated the details of the suit properties during the purchase. 10 Furthermore, whereas the plaintiff did not adduce evidence to indicate otherwise, the silence of the Permanent Secretary of the Ministry of Land, Housing and Urban Development, in its omission to respond to the letter of the 1st defendant, render any claim by the plaintiffs to the suit properties untenable and illegal as it is clear that the Plaintiffs did not submit any application letter to the $1^{\mbox{\scriptsize st}}$ defendant as clearly 15 they were no longer employees of the District, they were also no longer on the computerised payroll of the District, and they did not have allocation letters even if they were senior and were even not entitled to first priority because by the time the modalities were developed, it clearly excluded them because they were no longer in the employ of the 1st defendant though they claim they were yet to be paid their 20 retirement benefits which is another matter altogether.

Since they did not apply for the said premises, their continued stay in them became illegal, without the authority of the owner, which is the 1st defendant.

Accordingly, they would be found to be illegally in occupation of the suit properties and as they were already retired, which act excluded them from participating in 25 applying for the pool houses as they were strictly for those in employ of the 1st defendant not those who are retired and waiting the payment of their retirement

benefits. Because had the guidelines indicated otherwise then they would clearly be $\mathsf{S}$ eligible as sitting tenants to apply and be considered accordingly.

All in all, it is my finding that the 1st defendant became the rightful owner of the suit property when he responded to the advert by the 1st defendant and he complied the modalities issued by the 1st in the sale of its own suit properties. No evidence was brought to court to show that the plaintiffs sought to have declared illegal those either by an administrative appeal or sought for a judicial review of the same. That is not the case.

The position of the law is that where one is aggrieved by an administrative process, one has a right to seek for redress either through administrative process and where

none exists, then such a person has a right to apply to a competent court for a 15 judicial review of the process one is aggrieved with. This is not the case here.

Thus, it is my finding that the plaintiffs ceased to be entitled to first priority to the suit properties as they had already ceased to persons, who were according to the modalities issued by the $1^{\ensuremath{\text{st}}}$ defendant, were entitled to apply for $1^{\ensuremath{\text{st}}}$ defendant premises when they officially retired by the time the modalities came into play.

That being the case, the 3rd defendant is found to not have fraudulently obtained his registration as proprietor of the suit land for he rightfully applied for the suit premises, in accordance with the uncontested guideline issued by the 1st defendant. All the three issues are thus resolved in the negative.

b) What remedies are available to the parties?

The matter having been dismissed in favour of the $1^{\mbox{\scriptsize st}}$ and $3^{\mbox{\scriptsize rd}}$ defendants, the plaintiff is not entitled to the reliefs it seeks.

## $10)$ Costs:

Section 27 (1) Civil Procedure Act, Cap 71 states that,

... the costs of and incident to all suits shall be in the discretion of the court or judge, and the court or judge shall have full power to determine by whom and out of what... In this case since this suit is found to lack merits it is dismissed in the favour of the

- $1^{\rm st}$ and $3^{\rm rd}$ defendants. However, looking at the nature of this matter and the time it 10 has taken in court and given the misunderstanding by the plaintiffs of what they thought were their rights yet they were, at the time their assumed cause of action arose, were no longer employees of the 1st defendant, I exercise my discretion and would order no costs in respect of this matter. - Further, the plaintiffs are ordered to vacate the premises, which the 3rd defendant 15 lawfully and rightful purchased from the $1$ st defendant, within a period of three (3) months from the date of this judgment.

I do so order.

Hon. Justice Dr Henry Peter Adonyo

Judge 31st January 2024

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