Kaggwa v Bond Air Services Ltd and Others (Civil Suit No. 740 of 1994) [2001] UGHC 123 (20 June 2001)

Full Case Text

#### 41 IE REPUBLIC OF UGANDA

## IN THE HIGH COURT OE UGANDA AT KAMPALA CIVIL SUIT NO. 740 OP 1994

# RICHARD DEZIMAND KAGGWA PLAINTIFF -versus-

BOND AIR SERVICES LTD. & OTHERS DEFEN DANI'S BEFORE:- HON. THE PRINCIPAL JUDGE - MR. JUSTICE J. H. NTABGOBA

#### JUDGMENT

I am basing this judgment on the proceedings of the hearing of this case conducted by the late Justice I. Mukanza (RIP). Upon conclusion of the hearing and receipt of final 10th June 1999, adjourn the case for the judgment to be delivered on 31/8/99 at 23.3Op m. submissions from Counsel for the parties, the Judge did on

In the suit the plaintiff. Mr. Richard Dezimand Kaggwa sued Bond Air devices Ltd. Nile Bank, Ltd and Odoi Onyango, referred to as the first, second and third, defendants in that order. The plaintiff seeks judgment to be entered against the defendants for:-

(a) an order of permanent injunction;

(b) return of the plaintiff's certificate of title:

(c) aggravated. exemplary. special and general, damages for misrepresentation. fraud, breach of contract detinue and/or conversion;

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- (d) Costs of the suit: - the aggravated, exemplary, special and general damages al the rate of 25%p.a. from the date of judgment till payment; **5** (e) Interest on - (f) interest until payment in full. on special damages at the rate of 25%p.a. from 9th September. 1994 - (g) Interest on the Costs of the suit at the rale of 6%p.a. from the dale of filing of the suit until payment infull.

The suii was filed in this Court on 10th October 1994.

The background alleged in the plaint is that the 3rd defendant who was the Chairman and Managing Director of the first defendant defrauded die plaintiff who was the Operations Manager of the first defendant. Il is alleged that the third defendant promised, verbally, the plaintiff shares in the first defendant. The third defendant then asked the plaintiff to give him(3rd defendants power of Attorney io mortgage his (pJaintiff'sJregisiered land, which I iS will hereinafter refer to as the suit property. The land is comprised in LHR. Block 216 Plot 750 and is situate al Buye. Ntinda in Kampala and measures 0.85 hectares. Il is very substantial indeed.

The plaintiff says that no shares as promised were given to him; and therefore he could not be issued with share certificates in respect of (he 600 shares promised him. On 2nd August 1991, which was about Six months after the execution of his(plaiiuiffs)power

of Attorney in favour of the fust dcfendani, the plaintiff iccercd a Idler addressed by (he 2nd defendant to (he 1st defendant by which the suit properly was being threatened wilii sale Shs.24,708,724/= for which (he plaintiff's said certificate of title had been deposited by the mortgage loan of by auction, "due to failure by the first defendant to pay a first defendant as a security for the said mortgage loan".

*s*

Paragraph 15 of the plaint avers (liat:-

"On the 1st December 1991, the plaintiff discovered from the fiist defendant that on a date unknown io die piaintifi, (he third defendant acting in the course of the fir^l defendant's employment had "orally agreed and arranged

with the second defendant io direct lhe plaintiff's said certificate of title to be used as a security for an oid mortgage ioan obtained by the first defendant from ihe second defendant in 1989".

Paragraph 16 alleges that the plaintiff also discovered that the third defendant had redeemed his certificate of title which he had deposited with the second defendant to secure the old mortgage Ioan, by substituting therefor the plaintiff's certificate. The plaintiff avers **1-5** that the substitution was made by an oral agreement between the third defendant and die second defendant. The plaintiff did not say by what means he learnt of the oral agreement:

I discovered the averments of the plaintiff to be false when I read exhibit D2. which. defendant over Ike su:l property as a Security to scome a loan as follows: is a mortgage deed executed by the plaintiff on 26th. February 1991 in favour of the second

"IN CONSIDERATION of the Bank at the request of the mortgagor agreeing to make advances to the Principal Debtor(i.e. First defendant)to overdraw his/her current account with the Bank or granting to the Principal Debtor other financial accommodation from time to time to an amount not exceeding shs.5,000,000/ $=$ ---- (exclusive of interest but inclusive of all sums already advanced or incurred before the date of this Security or such lower sum as may from time to time be fixed by the Bank; (Underlining for emphasis).

1. (A) The Principal Debtor, HEREBY covenants with the Bank that the Principal Debtor will on demand in writing made to the Principal Debtor pay or discharge to the Bank all monies and liabilities which shall for the time being (and whether or not at any time after such demand) be due owing or incurred to the Bank by the Principal Debtor.

(B) The mortgagor HEREBY covenants with the Bank that the mortgagor will on demand in writing made to the mortgagor pay or discharge to the Bank all monies and liabilities which shall for the time being (and whether on or at any time after such demand) be due, owing or incurred to the Bank by the Mortgagor in each case either as principal or surety and whether soicly or jointly with the Company, society, corporation, person or persons in partnership or otherwise or upon loans or bills of exchange, or promisory notes------".

Counsel for the plaintiff in the final submission kept a distance from the provisions of the mortgage deed. He did not disclose, either in the plaint or in the submissions, how

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much indebtedness had been secured by the third defendants' mortgage or title deposited, as plaintiff's mortgage so that Court could discount it from the total of Shs. 24,708,724/ = . lhe concentration in Counsel's submission was on challenging the Power of Attorney. Whereas I agree that lhe form of a Power of Attorney provided by a statute e.g. Sections 154 and 155 of the Registration Titles Act need not be pleaded and ought to be complied with. basis of the claim of Shs. 24,708,724/= is the mortgage deed executed by lhe plaintiff in favour of the second defendant. The crux of the matter was as to what amount was secured by the plaintiff's mortgage deed. The failure of the plaintiff to prove that amount means that **I** *v* the mortgage deed is presumed to have been meant to secure the sum of Shs. 24.708,724/ = being claimed by the second defendant. The emphasis should be on the expression in the mortgage deed on page 4 of this judgment, namely, "but inclusive of all sums already advanced or incurred before lhe date of the Security". I am afraid I cannot see any fraud. as I think the plaintiff voluntarily executed the mortgage. Whether the 1st and third **(S** defendant failed to give him the shares promised by them is no concern of lhe second defendant whose rights derive from the plaintiff's mortgage deed. the issue in this case is not lhe power of attorney as the basis for the mortgage loan. The was alleged in 1989. There was no disclosuie of how much money was secured by lhe

1 accordingly dismiss lhe suit with costs to the second defendant. And I decline to order as prayed in lhe plaint.

**V 11** J. H. NTABGOBA PRINCIPAL. JUDGE **,2 C'** .0 **&lt; j . L.j- • -V\A 3 — fy**

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**I**

#### THE REPUBLIC OF UGANDA

#### IN THE HIGH COURT OF UGANDA AT KAMPALA

#### CIVIL SUIT NO. 740 OF 1994

### RICHARD BEZIMOND KAGGWA PLAINTIFF

#### VERSUS

1. BOND AIR SERVICES LTD ]

2. NILE BANK LTD 1 3. ONYANGO ODOI ]

DEFENDANTS

### BEFORE: HON. PRINCIPAL JUDGE - MR. JUSTICE J. H. NTABGOBA

#### DECREE

THIS SUIT coming for final disposal before the Deputy Registrar, Her Worship H. WOLAYO in the presence ofTUMUSIIME Esq., counsel for the 2nd defendant.

IT IS ORDERED AND DECREED that the suit against the second defendant be and is accordingly dismissed with costs to the second defendant.

We approve

COUNSEL FOR E PLAINTIFF

COUNSEL FOR THE 2nd DEFENDANT

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day of GIVEN under my hand and the seal ofthe Court on this .... 7.71 2001.

DEPUTY REGISTRAR

DECREE EXTRACTED BY:- *M/S EMORU&CO. ADVOCA TES P. O. BOX3155 KAMPALA.*

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