Kafu Sugar Limited & Another v Kiryandongo Sugar Limited & Another (Civil Application 607 of 2024) [2025] UGCA 41 (13 February 2025)

Full Case Text

# 5 THE REPUBLIC OF UGANDA IN THE COURT APPEAL OF UGANDA AT KAMPALA

CIVIL APPLICATION NO. 607 OF 2024 (Arising from Civil Appeal No.307 of 2O231

# 1. KAFU SUGAR LIMITED 2. JASWANT SINGH RAI APPLICANTS

VERSUS

### 1. KIRYANDONGO SUGAR LIMITED 2. SARBJIT SINGH RAI RESPONDENTS 15

# Before Hon. Justice Moses Kazibwe Kawumi, JA. (Sitting as a Single Justice)

## RULING

This Application was brought by Notice of Motion under Sections -16 and 98 of the Civil Procedure Act, Rules 2(21,6(2Xa), 53(2), 43 and 44 of the Judicature (Court of Appeal Rules) Directions S.l. 13-10. The Applicants seek an order for;-

- 25 - a) Stay of enforcement and execution of the judgment and decree in Civi! Suit No. 55 of 2OL7 pending the hearing and disposal of Civil Appeal No. 0607 of 2024 and; - b) Costs of the application to be provided for. 30

## Grounds

The grounds of the application are set out in the Application and in the supporting affidavit of Jaswant Singh Rai in which he avers as follows; -

> Page t of 22 0

- 5 1. The Applicants filed Civil Suit No. 55 of 2OL7 against the Respondents and 5 others seeking to challenge the grant of a leasehold interest in respect to land comprised in LRV 4591 Folio Ranch No. 23,28, ':9 and 30 Bunyoro Ranching Scheme, Kiryandongo District but the Suit was dismissed with costs. - 2. Aggrieved with the judgment, the Applicants filed Civil Appeal No. 307 of 2023 seeking to set aside the judgment of the High Court. - 3. That the Respondents filed Taxation Application No.22 of 2023 and the bill of costs was duly taxed. - 4. That the Respondents are seeking to execute the decree against the Applicants and demanded for payment of the costs. - 5. That the appeal has high likelihood of success and it is not frivolous as it involves substantive questions of law and of great public importance. 20 - 6. The there is an eminent threat of enforcement of the decree of rhe High Court to execute the taxed costs against the applicant amounting to UGX. L,205,995,000/= (Uganda Shillings One Billion Two Hundred Five Million Nine Hundred Ninety-Five Million Onlyl. - 7. That if this application is not gra;rted, the appeal will be rendered nugatory and the applicant will suffer substantial loss. - 8. That the Respondents are already in occupation of the suit land and as such, they have nothing to lose if this appllcation is granted and that the application was brought within reasonable time.

Page 2 22

5 9. That the Applicants sought an interim stay of execution and a main stay of execution in the High Court but the applications were dismissed with costs.

The Respondents filed an affidavit in reply through Sarbjit Singh Rai, the 2nd Respondent who opposed the application on the grounds thaU-

- 1. The application is incurably defective for non-service of Court p,ocess within the legally prescribed time, it was brought in bad faitir, i' is misconceived and that it ought to be dismissed with costs. 10 - 2. That the Respondent's Counsel came to learn of the application when it was called for conferencing on January 9, 2025 while he was attending another matter. - 3. That the Applicants' appeal does not have any rational basis, fo'rnded on the facts and the law and with no likelihood of success arrd,he application was brought in bad faith which offends the rules of law and equity and that the findings of the trial judge were right. - 4. That as successful litigants, they should not be denied the fruits of the judgment without good and cogent cause and that the Applicants have not disclosed any good cause. - 5. That the Applicants filed both an application for an interim order and a substantive application for stay of execution which were dismissed by the High Court. - 30

6. That the appeal will not be rendered nugatory if this application is dismissed as payment of costs does not delay or impair the character of the appea! or the right to appeal.

- 5 7. That the Applicants are not liable to suffer substantial loss if the costs are awarded as the payment is reversible and the Applicants can easily be compensated. - 8. That the Respondents are not impecunious and they have capacity to refund all the costs awarded in the suit. - 9. That the applicants are required to provide security for due performance of the decree in Civil Suit No. 55 of 20L7. - ln rejoinder through the affidavit of Patricia Kamugisha, an ad',oc?te working with Kampala Associated Advocates, the Applicants deny the contents of the affidavit in reply and contend as follows ;- 15 - 1. That this application was filed on October 2L, 2024 following the dismissal of an application for stay of execution in the High Court. - 20

- 2. That follow up to secure a hearing date was made on several occasions but all efforts were futile. - 3. That as a consequence, the application could not be served without a hearing date as it had not been assigned to any justice of Appeal. - 4. That on January 7,2025 the Applicants were served with a garnishee nisi arising out of Misc. Application No.86 of 2OL4 seeking to attach UGX. L,O39,79L,8O0/-- but at the time of receiving the order nisi, though the notice of motion was endorsed, it had not been as:igned to any Justice of appeal for handling.

- 5 5. That the Applicant's lawyers wrote a letter requesting Court to fix the application for hearing considering the urgency of the mater and the eminent threat of execution. - 6. That she is aware that the practice of Court is that applications of this nature are only served after the Court grants a hearing d:rte or conferencing directions which had not been issued by Janu,ary 9, 2025. - 7. That the application was only assigned a hearing date on Ja nuary 2L, 2025 when summons for hearing were issued. - 8. That the suit was meritorious and required hearing and the appea! has high chances of success. - 9. That the Respondents already attached over UGX. 360,000,000/= 3n6 UGX. 3L,000,000/= through garnishee proceedings from the znd Applicant's personal savings account. 20 - L0. That there is no need to deposit security for due performance since the Respondents substantially recovered UGX. 360,000,000f = as their legal costs and they wi!! not be prejudiced by the Branr of an order for stay. - 11. That the Applicants will suffer irreparable damage if this application is not granted as they stand to lose about UGX.700,000,000 /= bV way of garnishment. - L2. That it is in the interest of justice that this application is granted.

#### 5 Background

The background to this Application is that the Applicants are unsucr;essful parties in Civil Suit No.55 of 2017 filed in the High Court of Uganda at Masindi seeking to challenge the manner in which the Respondents obtained a lease in respect to land comprised in Bunyoro Ranching Scheme Rach No. 23, 28,29 and 30 Kiryandongo District (herein after referred to as "the suit land").

Being dissatisfied with the judgment, the Applicants filed Misc. Applications Nos. 88 and 89 of 2023 in the High Court of Uganda at N'asindi seeking orders of interim stay of execution and main stay of execut'on respectively pending the disposal of the main application and the Appeal respectively which were dismissed with costs.

20 The Respondents commenced execution of the Decree and garnished UGX. 360,000,000/- however the decree still stand unsatisfied. Another decree nisi awaits to be made absolute for the Respondents to recover the balance.

The Applicants filed this application on October 21,2024 seeking an order of stay of execution pending the hearing and disposal of Civil Appeal No. 307 of 2023 but the Respondents have already recovered about UGX. 360,000 ,000f = by way of garnishee since the filing of this application.

### Appearance

When the Application came up for hearing on January 24, 2025 the Applicants were represented by Mr. Bruce Musinguzi whil.: the Respondents' Counsel was absent. None of the parties attended Court. I he parties had filed written submissions which were adopted by the Court as their arguments.

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### 5 lssues for consideration

- 1. Whether the application is incompetent - 2. Whether the applicant satisfied the conditions for grant of an order of stay of execution

3. What remedies are available to the parties

### Submissions of the parties

- 1. Whether the application is incompetent. - 15

### Respondent's su bm issions

It was submitted for the Respondent that the law mandates every application to be served within2L days. Counsel cited rule L8 (1),43 and 50 of the rules of the Court and argued that the said rules colle:tively require service to be effected in a manner consistent with the prot:edrrre prescribed for the High Court.

It was submitted that service of Court process In the High Court is prescribed by the Civil Procedure Rules under Order 5 rule 2 which require that service of summons must be within 2L days from the date of issue. He further cited the case of Edison Kanyabwera V. Pastori Tumwebaze SCCA No. 06 of 2004 to support his argument that the supreme Court afrirmed that the requirement to serve with 21 days is mandatory and e qually applies to interlocutory applications.

He submitted that the effect of the failure to serve within the stipulated tirne coupled with the failure to apply for extension of time to serve out of time should lead to the dismissa! of the application. Counsel cited Order 5 rule 3 CPR to support is argument. Counsel invited the Court to find that the application incompetent for non-service and prayed for its dismissal with costs.

ln reply to the preliminary objection, Counsel for the applicant sub'nitted that the Respondent's counsel was misrepresenting the facts to mislead Court. He argued that whereas the Notice of Appeal was admitted on ECCMIS by the Registrar on22, November 2024, it lacked a hearing date or conferencing directions and it could not be served in the absence of the two. That the summons for direction were issued on January 2L,2025.

15 It was submitted that a Notice of Motion is equivalent to summons, requiring the attendance of the parties before the Court for hearin I on a specified date. He argued that summons are considered complete ;or service when they specify a date for appearance and that endorsement does not make the summons complete or ready for service. He relied on Order 5 rule L (2l.of the Civil procedure rules to support his argument.

- 20 Counsel further argued that the directions on conferencing were given by the Registrar on January 9,2025 in the presence of both Counse! and the Court directed the pleadings to be served upon counsel in Court. He i'rgued that the issue of non- service does not arise. He prayed that the object.on to be overruled. - 25 Consideration of the objection by the Court

I have perused the Notice of Motion in question, it was sealed by the Registrar on the 22d day of November 2024. !t is also clear that counsel for the Respondents obtained a copy of the application while in Court appearing in another application on 9th January 2025 upon the direction of the Registrar when the matter had been called for conferencing. - 5 Rule 18 (1) of the Rules of the Court provides for the way documents should be served and transmitted. lt provides that;- - "(1) Where any document is requiratd by these Rules to be served on any person, service may be effected in a woy directed in each cose by the court, which sholl normally be a way i t which o comporable process of the High Court could be served; ond in the absence of any speciol direction, it shall be made personally on the person to be served or ony person entitled under rule 23 of these Rules to appear on his or her beholf."

Order 5 rule L (21 provides for the time frame within which service of summons should be effected to the other party to the suit as below,-

"L. Summons.

(2) Service of summons issued under sub rule (1) of this rule shall be effected within twenty-one doys from the dote of issue; except thot the time moy be extended on opplicotion to the court, mode within fifteen doys after the expiration of the twenty-one doys, showing sufficient reasons for the extension."

It is evident that the time for service of the application lapsed on 12th December 2024 hence it was not served in accordance with Order 5 rule 2 of the Civil Procedure Rules.lt is however important to note that documents in the Court of Appea! are served by designated process s€i'v€rs under the direct supervision of the Registrar of the Court. 30

! agree with Counsel for the Respondents that failure to serve sun.mons within the stipulated statutory period is not a mere irregularity. Each cuse 35

- 5 should however be decided on its own peculiar facts. ln this case, Order 5 rule 1 (2) of the Civi! Procedure rules cannot hold sway given the fa .:t that the non-service of the Notice of Motion was as a result of the Court's inadvertence. The Respondents do not claim to have suffered any injustice resulting from the inadvertence of court. - 10

The Court invokes its inherent powers under Rule 2 (21 to overrule the preliminary objection raised by Courrsel for the Respondent. Article L26(2)(e) of the Constitution also enjoins courts to avoid technicalities and promote substantive justice which I find very applicable given the ailure by the court to effectively handle the application as it should have done.

# Consideration of the merits of the application

## Submissions of the parties

2. Whether the applicant satisfied tlre conditions for grant of an order of stay of execution 20

## Applicant's submissions

While citing the authority of Lawrence Musitwa Kyazza V Eunice Busingye

SCCA No. 18 of 1990, counsel submitted that the general principle is that where an unsuccessful party is exercising their right of appeal, it is the duty of the court to make such orders for staying proceedings in the judgrnent appealed from as this will prevent the appeal from being rendered nugatory. 25

It was argued that the grounds for grant of an order of stay of execut,on were laid down in the case of Theodore Ssekikubo & 3 others V. Attorrrey General & 4 others [2013]UGSC 21, as here below:-

a) The Applicants diligently lodged their notice of appeal

Page L0 cf 22

- 5 b) The intended appeal raises triable issues with a strong likelihood of success - c) The applicant will suffer irreparable damage if their application is not granted; and - d) The balance of convenience favours the applicants - It was submitted for the Applicants that they lodged Civil Appeal Nc. 307 in compliance with rule 6 (2Xb) of the rules of the Court and prayed that the application be granted so that it is not rendered nugatory. Counsel cited the authority of Nsabimana V Jokana and another C. A. Civil Application No. 222 of 2023 to support his argument. 10

As to whether the intended appeal raises triable issues with a strong likelihood of success, it was submitted that the appeal has ver,, high likelihood of success. lt raises questions of law and fact to be tried and the grounds raised are reasonable and arguable. Counsel cited the authority of

Gashumba Maniraguha V. Sam Nkundiye S. C. Civil Application No. 24 of 2015 to support his submission. 20

As to whether the applicant will suffer irreparable damage if their application is not granted. lt was submitted that the Respondents are seeking to obtain UGX. L,205,995,000/= which is not a minimal amc unt to be paid out as the sum is business capital for the Applicants.

While citing the authority of E. L. T. Kiyimba Kaggwa V. Hajji Abdu Nasser Katende [1985] HCB 43,Counsel submitted that irreparable injury does not mean that there should not be a physical possibility of repairing the injury but means that the injury must be substantial or material one that cannot be adequately compensated for in damages.

It was submitted that the applicant will suffer substantial loss and vill be forced to pay out a huge sum of money if the application is not granted.

Page Ll of 22

5 Counsel further submitted that the application was filed without unreasonable delay after the dismissal of the applications for stay of execution in the High Court.

### Respondent's su bmission

The Respondents' submissions were based on Lawrence Musitwa Kyazze V. Eunice Busingye and Theodore Ssekikubo & 3 others V. Attorney General & 4 others (Supra) for what courts consider before granting applications for stay of execution pending appeal. 10

It was argued for the Respondents that the courts have ac'opt€d conjunctive test requiring the applicant to satisfy all the conditions required for an order of stay of execution to be granted. Counsel cited Ogwen Merdard Fredrick V Bazanya Justine C. A Civil Application No.523 of 2024 and Remegio Obwana V The Registered Trustees of Tororo Diocese C. A. Civil Reference No.69 of 2O2O to support his argument.

Counse! submitted that the Applicants had failed to meet all the grounds for grant of the orders sought since;- 20

- a) The applicants have not demonstrated that they will suffer substantial loss or irreparable damage thereby rendering the appeal nugatory - b) The appeal has low chances of success - c) The applicants have not provided security for due performance of the decree.

Counsel expounded on the arguments as follows:-

Counse! submitted that the applicants are mandated by law to demonstrate that the pending appeal has a reasonable likelihood of success and is not frivolous. Counsel argued that the chances of success of the appeal are too remote. Counsel argued that there is no sound or rational basis for the appeal grounded in both facts and the law as; the

- 5 grounds of appeal are devoid of any reasonable basis in law and equity and cannot be supported by a good faith argument. He argued that the applicants failed to demonstrate to Court that the appeal has high likelihood of success and invited Court to find as such. - 10 t5 Whether the applicants will suffer substantial loss or irreparable d,.rmage thereby rendering the appeal nugatory. Counsel argued that an appeal is rendered nugatory if the execution of an order is irreversible or, if reversible, cannot be adequately compensated by damages. He cited Lubega Moses V. Nassimbwa Sylvia C. A. Civil Application No. 0122 ot 2024 to define the word "nugotory" to mean "of no force or effect; useless; involid".

Counse! adopted the definition of the term "substontiol loss/irreptroble domage" in E. L. T. Kiyimba Kaggwa V. Hajji Abdu Nasser Katende (Supra) and invited Court to balance the risk of substantial loss to the Applicants visa vis the Respondents' right to enjoy the fruits of litigation.

Counsel submitted that monetary decrees are not typically stayed, that their satisfaction does not constitute substantial loss or irreparable damage. He cited Lubega Moses V, Nasimbwa Sylvia (Supra) and Ssengendo V. Busulwa and another C. A. Civil Application No. 207 ol2OL4

25 to support his argument.

Counsel invited Court to find that the applicants failed to establish that substantial loss would result from the payment of costs.

As to whether the applicant has given security for due performance of the decree. Counsel submitted that the requirement for furnishing security for due performance of the decree is mandatory. He cited DFCU Bank LTD V. Dr. Ann Persis Nkate Lussejje C. A. Civil Application No. 29 of 2003 to support his argument.

Page L3 of 22

He further cited Lubega Moses V. Nassimbwa Sylvia (Supra) whe:e the Court of appea! (Gashirabake J.) held as follows;-

"Considering, the law under rule 6 (2), the institution of an appeal does not operote os o stoy of execution. The Applicont must odduce evidence to satisfy court that there is a need to grant a stay of execution. One of the requirements for gront of stay of execution is the need to deposit security for due performonce (see, Lawrence Musitwa Kyozze V Eunice Busingye (supra) the opplicont has neither deposited nor indicoted that he woul I deposit security for due performonce. (See Horuno Sentongo v I & M Bonk Ltd Civil Application No. 773 of 2023 , [2023] UGCA 753 (79may 2023).

a) The applicotion is hereby declined."

20 Counsel thus invited the Court to find that since the applicants did not furnish security for due performance of the decree, the application should be denied as it falls short of the conjunctive test for the grant of ar order for stay of execution.

On what remedies are available to the parties, counsel submitted that costs follow the event. He relied on the authority of P. K. Ssengendo V.

25 Busulwa Lawrence and another C. A. Civil Application No. 207 of 2014 to support his proposition.

### Submissions in rejoinder

Counsel submitted that the Respondents taxed the bill of costs at an exorbitant figure of UGX. L,039,79L, 8OO/= and have garnished UGX. 360,000,000/-- and 31,000,000 from the 2nd Applicant's account since the filing of the Application. The Respondents are now actively tracing and identifying assets belonging to the applicants in a bid to enforce what remains unpaid.

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10 Counsel further submitted that the Applicants satisfied all the grounds for the grant of an order for stay of execution. He argued that the exterrsive submission by the Respondents rather pre- empty the main appeal and that the court ought to only examine the Memorandum of App -"al to determine whether the appeal has chances of success.

15 He relied on Byamukama Fred V. Kyampagi and 3 others C. A. Civi! Appf ication No. 289 of 2024120241UGCA 289 (3 October 20241as wel! as Hamir Khunti V. Uganda Muslim Supreme Counsel C. A. Civil Application No. 253 of 2O24 l2024l UGCA 263 (LZ September 2O24) to support his argu ment.

As regards irreparable damage or the appeal being rendered nugatrry if a stay of execution is not granted, Counsel cited Hamir Khunti V The Ugar da Moslem Supreme Counsel (Supra). Counsel further argued that the applicant will suffer irreparabte damage since the Respondents already initiated and garnished over 360,000,000f= from the Applicants accounts and they seek further to garnishee assets worth 700,000,000f = to fully satisfy the decree.

25 30 As regards the Respondents not being impecunious and being able tc repay the decretal sum in the event that the Appeal succeeded, counsel lor the Applicant cited Haruna Enterprises (U) Ltd and another V. Diamond Trust Bank (U) Limited C. A. Civil Application No. L27L of 2O23 where it was held that damage that cannot be undone or is difficult to recover constitutes substantial loss.

On the issue of security for due performance of the decree, it was submitted that the authority of Theodore Sekikubo and 3 ot'rer V. Attorney General and 4 others (supra) does not require security for Cue performance to be furnished before an order of stay of execution is issued.

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(

- 5 Counse! cited Joel Kato and Margaret Kato V. Nuulu Nalwoga, U(,SC 15 [2013] (1 February 2013) where it was held that the Court is only required to exercise its discretion as it may consider just. That the practice of imposing a condition for security for due performance is a rule of practice based on case law. - L0

Counsel argued that the Respondents already recovered over 360,000 ,000f = and there is no need to order security for due performance. He thus invited Court to grant an unconditional order to stay execu.ion of the Decree in the High Court and reiterated the submissions in support of the application.

Consideration by the Court

I have considered the application, the submissions of both counsel and the authorities cited and those not cited but are relevant for purposes of resolving this application.

Rule 6 (21(b) of the Rules of the Court provides as follows:-

"6. Suspension of sentence and stay of execution

(1) Subject to sub rule (1) of this rule, the institution of on appeol sholl not operate to suspend any sentence or to stoy execution, but the court moy-

(b)in ony civil proceedings, where o notice of oppeal has been lodged in occordonce with rule 76 of these Rules, order o stay of execution, an injunction, or o stoy of proceedings on such terms as the court moy think just."

As both counsel aptly submitted and as was held in the case of Lawrence Musitwa Kyazze V. Eunice Busingye Civil Application No. 18 of 1090, the purpose of the grant of an order of stay of execution is to help preserve the status quo and have the merits of the appeal handled by the ful! bench.

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- The requirements for the grant of a stay of execution were laid out in Theodore Ssekikubo & 3 others V. Attorney General & 4 others S. C. Constitutional Application No.6 of 2OL3 (supra). The Court mr:st be satisfied thaU- - 10

- e) The Applicants diligently lodged their notice of appeal - f) The intended appeal raises triable issues with a strong likelihood of success - g) The applicant will suffer irreparable damage if their application is not granted; and - 15 h) The balance of convenience favours the applicants

Thus the granting of an order of stay of execution is an exercise of j.rdicial discretion and it is intended to prevent the ends of justice from being defeated pursuant to the provision or Rule 2 (2l,of the rules of this court which provide that; -

"2. Application

(1).....

(2) Nothing in these Rules shoil be token to limit or otherwise affect the inherent power of the court, or the High Court, to make such orders os moy be necessary for o'119!n!ngg rc ends of iustice or to prevent obuse of the process of ony such court, ond that power sholl extend to setting aside judgments which have been proved null and void after they have been possed, and sholl be exercised to prevent abuse of the process of ony court coused by delay."

5 On whether the applicant diligently lodged their notice of appeal a rd the appeal has a likelihood of success

It was held by the Supreme Court in the case of Gashumba Maniraguha V. Sam Nkundiye S. C. Civi! Application No. 24 of 2015 that the likelihood of success, is the most important consideration in an application for stay of execution.

The judgment from which the Appeal arises was delivered by the trial Court on 17th June 2022. The Notice of Appea! was filed within the man Jatory statutory period after the judgment. Accordingly, the Notice of Appeal was diligently filed.

The Applicants contend that the appeal has very high chances of success and it is not frivolous. The Memorandum of Appeal was annexed to paragraphT of the affidavit in support of the application as annexure"B."

The Applicants fault the trial judge for failing to find that there wa: fraud while the Respondents were procuring the certificates of title to the suit land. The Applicants further contend that the L't Respondent did not meet the conditions precedent for the grant of a lease.

I find the authority of Stanely Kang'ethe Kinyanjui V. Tony Ketter and 5 others [2013] KLR.... persuasive in the description of an arguable appea!. lt was held that; -

"vii) An arguable oppeol is not one which must necessarily sr,;ceed, but one which ought to be orgued fully before the Court; one which is not frivolous.

viii) ln considering on opplication brought under rule 5 (2) (b) the Court must not moke definitive or finol findings of either fact or low ot that stoge os doing so may emborross the ultirnate heoring of the main appeol."

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It has also been held by this Court that it is not the duty of the Court at this stage to pre-empt considerations of matters for the full bench in determining the appeal. See Obwana Remegio V. The Registered Trrrstees of Tororo Diocese, Court of Appeal Civil Reference No. 69 of 2020.

The applicants not only attached the Memorandum of Appeal but also laid out the questions for investigation on appeal under paragraph a (a) and (b) of the affidavit in rejoinder. I have noted the Respondent's submissions are inconsequential as they majorly relate to what is to be considered in the main appeal before a full bench of the Court.

I therefore find that the Applicants proved that they have an appea! with a high chance of success or a prima facie appeal.

20 As to whether the Applicants will suffer irreparable damage or that the appeal will be rendered nugatory is a stay is not granted.

The Applicants pleaded that they will suffer substantial loss and the appeal wil! be rendered nugatory if the application is not granted. lt was also averred that in paragraph 8 of the affidavit in rejoinder that the Applicants appealed against the taxed costs but the Respondents went ahriad to garnish colossal sums belonging to the 1't Applicant.

30 The Respondents do not dispute that they attached large sums of money from the Applicants' bank account with DFCU Bank Limited. The Respondents' sole argument is that they are not impecunious and will be able to pay the taxed costs in the event that the Appeal succeeds.

Page L9 of 22

- 5 ln Geila V Cassman Brown & Co. [1973] E. A.358, lt was held t;rat by irreparable injury it does not mean that there must not be physica! possibility of repairing the injury, but it means that the injury or damage must be substantial or a material one that is; one that cannot be adequately atoned for in damages. - 10

The L't Applicant is a sugar factory while the 2nd Applicant is a director in the 1't Applicant. Garnishing colossa! sums of money would cripp le the operations of the L't Appllcant and may put it out of business. This wo'rld be to the detrlment of the economy and the wider society depending on the 1st Applicant's existence for survival.

I therefore find that the Applicants satisfied this Court that they will suffer irreparable injury if the application for stay is not granted.

## Balance of convenience

The balance of convenience tilts in favor of the party who will suffer more if the application is not granted. ln considering whom the bala'rce of convenience favors, this Court is enjoined to consider the loss or risk to be suffered by the Responderrt in the event that tlris application is granted and the damage to be suffered by the Applicant in case the application is denied. 20 25

It is not disputed that the Respondents are already in possession of the suit property and also that they have already partly garnished over UGX. 360,000,000f= in partial satisfaction of the decree. lt is also not der,ed by the Respondents that they are in search more assets belonging to the Applicants in order to recover the balance of the decretal sum yet there is a pending appeal with a likelihood of success.

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- 5 On that premise, the balance of convenience tilts more in favour or the Applicants who stand to be inconvenienced to recover the attached sums if this application is not granted. The Respondents will proceed to recover the balance in case the full bench of the Court finds no merit in the A cpea!. - As regards security for due performance, I do agree with the submission that in the case of Theodore Sekikubo, the court did not decide that an applicant must furnish security for due performance of the decree as a precondition for the grant of an order of stay of execution. 10

It has long been held in the Supreme Court decision of Joel Kato and Margaret Kato V. Nuulu Nalwoga S. C. Civil Application No. 04 of 2OL2 UGSC 15 [2013] (1 February 2013] that the practice of imposing sr curity for due performance of the decree in some cases is only a rule of pract;ce 15

based on case law.

Rule 6 (2Xb) requires the Court to order a stay of execution as it may consider just. The Court can order a stay of execution even withotit an order for the applicant to pay security for due performance of the decree. Each case should be decided on its facts depending of what is just in the pa rticu la r circu msta nces. 20

The circumstances of this particular application are that the suit property is in the possession of the Respondents. The same Respondents recovered part of the taxed costs before the application was heard. On that premise, lfind this as a suitable application where security for due performance of the decree should not be furnished.

(

5 Before ltake leave of the matter, !wish to point out that there i.; a difference between security for costs and security for due performance of a decree. The case of DFCU Bank LTD V. Dr. Ann Persis Nkate Lussejje C. A. Civil Application No. 29 of 2003 cited by counsel for the Respondents was resolved on the issue of security for costs and therefore distinguisl:able from the instant application.

Ifurther note that the authorities of Horuna Lubega Moses V. Nossi nhwo Sylvio (Supro) ond Horuno Sentongo V. I & M Bonk Ltd Civil Applicot,on (Supro) cited by Counsel are persuasive but not binding on this court. I am inclined to follow Joel Kato and Margaret Kato V. Nuulu Nalwoga (Supra) whose reasoning I have accordingly adopted and applied.

For the reasons given above, I find that the applicant satisfied the conditions for the grant of an unconditional order of stay of execution. The Application is granted with the following orders; -

- a) An order of stay of execution is granted until the determination of Civil Appeal No.307 of 2023. - 25 b) Costs of this application shall abide the result of the appeal.

Dated and delivered at Kampala this . d\*day of .:....... 2025.

Moses Kazibwe Kawumi Justice of Appeal 30