Hotloaf Bakery Limited v Engaano Millers Limited (Miscellaneous Application No. 656 of 2025) [2025] UGCommC 177 (19 June 2025)

# 5 **THE REPUBLIC OF UGANDA IN THE HIGH COURT OF UGANDA AT KAMPALA (COMMERCIAL DIVISION) MISCELLANEOUS APPLICATION NO. 656 OF 2025 (ARISING FROM CIVIL SUIT NO. 293 OF 2025)** 10 **HOTLOAF BAKERY LIMITED ::::::::::::::::::::::::::::::::::::::::::: APPLICANT VERSUS ENGAANO MILLERS LIMITED :::::::::::::::::::::::::::::::::::::: RESPONDENT**

15 **BEFORE: HON. LADY JUSTICE PATIENCE T. E. RUBAGUMYA**

### **RULING**

Introduction

This application was brought by way of Notice of Motion under **Order 36 rule 4 and Order 52 rules 1 and 3 of the Civil Procedure Rules SI 71-** 20 **1**, seeking orders that:

- 1. The Applicant be granted unconditional leave to appear and defend *Civil Suit No. 293 of 2025*. - 2. Costs of this application be provided for.

### Background

- 25 The background of this application is contained in the affidavit in support deponed by **Mr. Kodawa Mutano** the Applicant's Managing Director, and is summarized below: - 1. That the parties executed an Agreement for the supply of drum wheat flour to the Applicant by the Respondent.

- 5 2. That the purported claim of UGX 92,012,600/= is incorrect since the Applicant has so far paid UGX 20,000,000/= and therefore the remaining balance is UGX 82,012,600/=. - 3. That the Applicant is willing to clear the outstanding debt of UGX 82,012,600/= by making weekly deposits of UGX 5,000,000/= until; 10 the debt is fully settled. - 4. The Applicant has not refused to pay the outstanding sum but it encountered financial challenges in its business operations.

In reply, the Respondent through an affidavit deponed by **Mr. Naluswa Roy Jacob** its Accountant, opposed the application contending that:

- 15 1. The Respondent filed a summary suit seeking to recover UGX 92,012,600/= but the Applicant has since made some payments, reducing its debt to UGX 82,012,600/=. - 2. The Applicant has no plausible defence and therefore, the application should be dismissed with costs and judgment entered in 20 favour of the Respondent.

### Representation

The Applicant was represented by Learned Counsel Wacha Moses of **M/s KGN Advocates** while Learned Counsel Ronald Kasiisa of **M/s Kasiisa & Co. Advocates** represented the Respondent.

- 25 Issues for Determination - 1. Whether the Applicant has raised sufficient grounds to warrant the grant of unconditional leave to appear and defend *High Court Civil Suit No. 293 of 2025*? - 2. What remedies are available to the parties?

# 5 Issue No. 1: Whether the Applicant raised sufficient grounds to warrant the grant of unconditional leave to appear and defend *High Court Civil Suit No. 293 of 2025*?

#### Analysis and Determination

I have taken into consideration the affidavit in support of the application 10 and the affidavit in reply. On 11th June, 2025, when the matter came up for hearing, both Counsel made oral submissions. I have not seen the need to reiterate the submissions herein, but I have considered the same before arriving at my decision.

- **Order 36 rule 3(1) of the Civil Procedure Rules**, stipulates that a 15 Defendant served with summons, issued upon the filing of an endorsed plaint and affidavit under rule 2 of this Order endorsed, "Summary procedure", shall not appear and defend the suit except upon applying for, and obtaining leave from Court. It is now trite that for leave to appear and defend a summary suit to be granted, the Applicant/Defendant must show - 20 by affidavit or otherwise that there is a bona fide triable issue of fact or law.

A triable issue is one capable of being resolved through a legal trial, that is, a matter that is subject to or liable to judicial examination in Court. It has also been defined as an issue that only arises when a material 25 proposition of law or fact is affirmed by one party and denied by the other.

(See: *Jamil Ssenyonjo Vs Jonathan Bunjo Civil Suit No. 180 of 2012*).

It is also trite that a defence raised by the Applicant should not be averred in a manner that appears to be needlessly bald, vague, or sketchy. If the defence is based upon facts, in the sense that material facts alleged by the 30 Plaintiff in the plaint are disputed or new facts are alleged constituting a

5 defence, the Court does not attempt to decide these issues or to determine whether or not there is a balance of probabilities in favour of one party or the other.

In essence, where the Applicant raises a good defence, the Plaintiff is barred from obtaining a summary judgment. Furthermore, in the case of

10 *Maluku Interglobal Trade Agency Ltd Vs Bank of Uganda [1985] HCB 65*, Court noted that in such a case:

*"The Defendant is not bound to show a good defence on the merits but should satisfy the Court that there was an issue or question in dispute which ought to be tried and the Court shall not enter upon the trial of* 15 *issues disclosed at this stage."*

In the instant, as per the pleadings, the Respondent instituted *Civil Suit No. 293 of 2025*, a summary suit, seeking to recover UGX 92,012,600/= arising from the supply of goods to the Applicant, interest and costs of the suit.

- 20 It is undisputed that on 5th December, 2018, the parties executed an Agreement, annexure **"A"** attached to the summary plaint, wherein the Respondent agreed to sell/distribute drum wheat flour and a variety of associated products to the Applicant. The Respondent contends that the Applicant defaulted in the payment for the goods supplied. - 25 Learned Counsel for the Applicant submitted that the Applicant should be granted unconditional leave to appear and defend because it has a triable issue and plausible defence. That the Applicant is not indebted in the sums claimed in the plaint since it effected some payments towards the settlement of the debt.

- 5 Under **Paragraph 5** of its affidavit in reply, the Respondent averred that at the time of filing the main suit, the Applicant was indebted to a sum of UGX 92,012,600/= but that the Applicant has since made some payments reducing its indebtedness to UGX 82,012,600/=. The above is solidified by an account statement annexure **"A"** adduced by the Applicant showing - 10 their current debit closing balance with the Respondent as UGX 82,012,600/=.

In light of the above, the outstanding amount of UGX 82,012,600/= is not contested by the Applicant. Further, the Applicant has not raised any triable issue for determination by the Court to warrant granting leave to 15 appear and defend the suit.

As was held in the case of *Twentsche Overseas Trading Co. Ltd Vs Bombay Garage [1958] EA 741*, summary procedure is only resorted to in clear and straightforward cases where the demand is liquidated and there are no issues for determination by the Court except for the grant of 20 the claim.

In view of the above and as admitted, the Applicant is indebted to the Respondent in the sum of UGX 82,012,600/=, the current outstanding amount due.

Accordingly, this issue is answered in the negative.

25 Issue No. 2: What remedies are available to the parties?

This Court having found issue No.1 above in the negative, further finds that this application for leave to appear and defend is devoid of merit.

It is settled law that summary procedure provides a quick way for the Plaintiff who demands a liquidated sum to obtain judgment where there is

30 no evident defence. (See: *Post Bank (U) Limited Vs Abdu Ssozi, SCCA*

## 5 *No. 8 of 2015* and *Ndibazza Naima Vs Acacia Finance Limited HCMA No. 1144 of 2014*).

Accordingly, this application is dismissed, and the Respondent/Plaintiff is entitled to a Decree under **Order 36 rule 5 of the Civil Procedure Rules**.

In its plaint, the Respondent also prayed for interest and costs of the suit.

10 a) Interest

**Section 26(2) of the Civil Procedure Act, Cap. 282**, is to the effect that the Court has the discretion to award interest. As was held in the case of *Milly Masembe Vs Sugar Corporation (U) Ltd and Another SCCA No. 1 of 2000*, the guiding principle is that interest is awarded at the discretion 15 of the Court, but the Court should exercise the discretion judiciously,

taking into account all the circumstances of the case.

In the case at hand, the Respondent/Plaintiff prayed for interest at the rate of 6% per annum from the date of Judgment until payment in full. I find the claimed rate of 6% per annum reasonable and fair in the 20 circumstances.

Therefore, I hereby award interest at the rate of 6% per annum on the decretal sum from the date of Judgment until payment in full.

b) Costs

**Section 27(2) of the Civil Procedure Act** provides that costs of any cause 25 follow the event unless otherwise ordered by Court. In the case of *Uganda Development Bank Vs Muganga Construction Co. Ltd [1981] HCB 35,* **Hon. Justice Manyindo** (as he then was) held that:

> *"A successful party can only be denied costs if it is proved, that but for his or her conduct, the action would not have been brought, the*

5 *costs will follow the event where the party succeeds in the main purpose of the suit."*

The Respondent/Plaintiff being the successful party in this case is therefore entitled to costs of this application and the suit.

Accordingly, Judgment is hereby entered for the Respondent/Plaintiff 10 against the Applicant/Defendant in the following terms:

- 1. The Applicant/Defendant shall pay the Respondent/Plaintiff UGX 82,012,600/= (Uganda Shillings Eighty Two Million Twelve Thousand Six Hundred Only) being the current outstanding amount due in *High Court Civil Suit No. 293 of 2025*. - 15 2. The Applicant/Defendant shall pay interest on the sums in (1) above at the rate of 6% per annum from the date of Judgment until payment in full. - 3. The Respondent/Plaintiff is awarded the costs of this application and the suit. - 20 I so order.

Dated, signed and delivered electronically via ECCMIS this **19th** day of

**June, 2025**.

Patience T. E. Rubagumya **JUDGE** 25 19/06/2025 6:30am

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