Kagodo Farmers Limited v Kampala Capital City Authority (Miscellaneous Application 2441 of 2024) [2025] UGHCLD 42 (13 March 2025)

Full Case Text

### THE REPUBLIC OF UGANDA

## IN THE HIGH COURT OF UGANDA HOLDEN AT KAMPALA

### (LAND DIVISION)

## **MISCELLANEOUS APPLICATION NO.2441 OF 2024**

## (ARISING OUT OF CIVIL SUIT NO. 56 OF 2016)

# KAGODO FARMERS LIMITED::::::::::::::::::::::::::::::::::::

### **VERSES**

# KAMPALA CAPITAL CITY AUTHORITY::::::::::::::::::::::::::::::::::::

#### **BEFORE:** HON. LADY JUSTICE NABAKOOZA FLAVIA. K **RULING**

This application was brought by notice of motion under Section 33 of the Judicature Act, Section 34(1) and 98 of the Civil Procedure Act; and Order 52 Rules 1, 2 and 3 of the Civil Procedure Rules seeking the following reliefs; -

(a) A declaration that the Respondent acted in contempt of the consent judgement endorsed by this court vide, Kagoda Farmers Limited Vs Kampala Capital City Authority, CS No. 56 of 2016 and entered on the 15th February, 2018 in so far as the Respondent has to date consistently and deliberately refused and or neglected to recognise the Applicant's sub-lease interest in the suit land and to grant vacant possession of the same to the Applicant to enable the Applicant cause developments thereon OR otherwise compensate the Applicant for its residual interests in the suit land comprised in LRV 3349 Folio 12 Plot 17 - 19 Burton street, Kampala along the periphery of the Old Taxi Park, all formerly measuring 0.112 Hectares equivalent to approximately 27.6 decimals and currently measuring approximately 0.104 Hectares equivalent to 0.257 acres, along the periphery of the Old Taxi Park currently valued at a sum of USD 5,098,952.

(b) An order for punitive or exemplary damages in a sum of UGX 500,000,000/with interest thereon from the date of the ruling in this application against the Respondent for its intransigence and contemptuous conduct towards this honorable court's orders until payment in full.

(c) An order doth issue against the Respondent compelling it to purge its contempt by immediately granting vacant possession of the suit land to the Applicant to enable the Applicant's officials develop the suit land in the terms of the consent judgment.

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(d) In the alternative, in the event that the Respondent is no longer able to grant vacant possession of the suit land to the Applicant in the terms set out in the consent judgement, a consequential order doth issue against the Respondent compelling it to pay the Applicant compensation in lieu of its residual interest in the suit land in the sums of USD 5,098,592, it being the current market value of the land together with interest thereon at the court's rate from the date of the order until payment.

(e) Costs of the Application be provided for.

The grounds of the application are supported by the affidavit of Mr. Genza Godfrey (the Applicant's managing director) and Mr. Moses Opito (a valuation surveyor). it. It is deposed that the Applicant filed HCCS No. 56 of 2016 against the Respondent, and that the parties entered into a consent judgment which was duly endorsed by this court on 15/02/2018. That the Respondent resurveyed the suit land, executed new leases and instructed the Office of the Commissioner Land Registration to process a new leasehold certificate of title in favor of the Applicant for the land then comprised in LRV 3349 Folio 12 Plot 17-19 Burton street measuring 0.112 Hectares equivalent to approximately 27.6 decimal now measuring 0.104 Hectares equivalent to 0.257 acres. That to date, the Respondent has refused to grant vacant possession of the suit land to the Applicant, and the 11 months' period, within which the Respondent undertook to consider compensation for the residual interest or approve the plans for construction of permanent structures, has since lapsed. That the consequential order is desirable to compel the Respondent to either grant vacant possession or to pay compensation in lieu of the Applicant's land at the respective market value. That it is in the interest of justice that the application is granted to give effect to the consent judgment dated 15/02/2018.

The applicant attached the following evidence to support its application; - a copy of a plaint vide HCCS No. 56 of 2016; a memorandum of understanding between the parties; a certificate of title for land comprised in LRV 3349 Folio 12 Plot No. 17-19 registered in the names of the Applicant and a lease agreement; copy of the consent Judgment, and a surveyor's report.

The Respondent opposed the application through an affidavit deposed to by Mr. Nathan Asanasio Kasule (Manager Land Management Unit). He stated that the breach of the consent judgment gives rise to a suit but not a contempt application. That the Applicant's claim for compensation of USD 5,0989,952 being the value of the

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suit land which can only be heard and determined in an ordinary suit and not by affidavit evidence. That the suit land has no developments and the Applicant's sub lease expired. That there is no subsisting lease in respect of the suit land and that the Applicant has no locus standi.

He deponed further that the suit land is yet to be resurveyed for a fresh sub-lease and issuance of a lease-hold certificate of title. That the Respondent signed a contract for consultancy service with $M/s$ DASUDA Foundation of Netherlands to carry out a feasibility study for re-development of old taxi park and develop a masterplan for the old taxi park. That due to budgetary constraints, which will be completed in 2026. That the Applicant's intended developments are subject to the old taxi park development master plan as stated in paragraph 3 of the consent judgement. That the Applicant can only be compensated for the suit land at the market value after the parties have been heard in an ordinary suit.

I take note of the Applicant's affidavit in rejoinder, whose contents I will not reproduce.

#### Representation;

The Applicant was represented by Counsel Joseph Kyazze of M/s Magna Advocates while the Respondent was represented by Counsel Denis Byaruhanga. Both Counsel filed their respective written submissions, which I have considered in this ruling.

Counsel for the Applicant raised the following issues;

- 1. Whether the nature of the remedies sought by the Applicants required filing of a fresh suit, and if so, whether the instant application is incompetent? - 2. Whether the Respondent is in contempt of the consent judgment and decree in HCCS No. 56 of 2016? - 3. Whether this is a proper application for grant of the consequential orders sought? - 4. What remedies are available to the parties?

Counsel for the Respondent raised preliminary objections to wit; -

- 1. That the Applicant's claim for compensation of USD 5,098,952 being the value of the lease hold interest can only be heard and determined in an ordinary suit but not a contempt/consequential order application. - 2. That the present contempt application is premature.

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I note that the above preliminary objections are well addressed under issue one. 100 Therefore, they shall be addressed, as such, under issue one. Submissions on Issue One Counsel for the Applicants cited the case of Dison Okumu & Ors Vs Uganda Electricity Transmission Co. Ltd & Ors SCCA No. 18/2020 to argue that 105 once a consent is entered and endorsed, it becomes an effective order or decree. That the consent judgment and decree determined the issue of vacant possession which was one of the remedies sought in the suit and that ordering the Applicant to institute an action premised on vacant possession would be against the principle of res-judicata under Section 7 of the Civil Procedure Act. 110 Counsel relied on the case of Kateregga George William Vs Commissioner Land Registration Misc. Application No. 347 of 2013 and argued that the consent judgment was a judgment in rem which determined the rights of the parties, and decreed that the Respondent issues a sub-lease in favor of the Applicant for a whole period of 49 years, grant vacant possession or in the 115 alternative, pay monetary compensation. That the Applicant being the successful decree holder is not required to file a fresh suit in order to enforce satisfaction of the judgement/decree.

120 To support his arguments still, Counsel cited the case of Sinba (K) Ltd & Ors Vs Uganda Broadcasting Corporation (SCCA No. 3 of 2014) and Section 34 of the Civil Procedure Act and contended that the Applicants has adopted the correct procedure to settle questions relating to enforcement or discharge of the consent judgement and decree of the court and that the suggestion that the procedure is by formal suit is misconceived. That at the hearing, the Respondent 125 never applied to court to treat the application as a suit or to be allowed to adduce oral evidence or to cross examine the Applicant's witnesses. That the Respondent is bound by the terms of the consent decree, and a party who chooses to disobey the order without good reason risks being held in contempt. 130

> In reply, Counsel for the Respondent cited the cases of **Kateregga George** William Vs Commissioner Land Registration (supra) and Betty Kizito Vs Dickson Nsubuga & Ors SC Civ. Application No. 25 & 26 of 2021 and argued that the judgement entered on the agreement of the parties, sanctioned by court constitutes a contract between parties thereto and that the Applicants are erroneously treating contempt of court as an ordinary mode of executing a decree. He submitted that the facts in the case of Dison Okumu & Ors Vs

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**Uganda Electricity Transmission Co. Ltd & Ors** are distinguishable from the present case since the appeal determined whether a consent judgment and the orders made therein can be appealed. He further cited the case of David Onen & 2 Ors Vs Ocan Otto & 2 Ors Misc. Application No. 131 of 2019 where justice Stephen Mubiru held that:

the contempt power is a discretionary one. If courts were to find contempt too easily, a court's outrage might be treated as simply raising a storm in a teacup that might ultimately cheapen the role and authority of the very judicial power it seeks to protect. Contempt of court cannot be reduced to a mere means of enforcing judgement, as the applicants by their prior application seem to believe. Courts have consistently discouraged its routine use to obtain compliance with court orders. The power should therefore be used cautiously and with great restraint. It is an enforcement power of last rather than first resort.

Counsel further relied on Section 61 (a) of the Contracts Act Cap 284 and argued that a breach of contract leads to an ordinary suit. That a claim of over USD 5,098,952 for the leasehold interest can only be heard and determined in an ordinary suit where the parties can present their respective evidence. Secondly, that the instant application is premature since the Applicant's sublease expired and has never been renewed. Therefore, that there exists no sub-lessor- sublessee relationship between the parties and that since the Applicant is yet to apply for and obtain a renewal of a lease in respect of the suit property, the remedy of failing to recognise the Applicant's lease hold interest and that of granting vacant possession are premature.

In rejoinder, Counsel for the Applicant argued that the application can be deemed to be premature if any of the elements to sustain the prayers sought are non-existent at the time of filing. That in this application, the Applicant has to prove that there is a lawful order, the contemnor is aware, the ability to comply, and the deliberate failure to comply.

**Determination of Issue One: Whether the nature of the remedies sought** by the Applicants required filing of a fresh suit, and if so, whether the instant application is incompetent?

In the consent judgment entered on 15th February, 2018, it was decreed that; -

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| a. The Defendant hereby recognises the Plaintiff's sub-lease in land comprised in | |-----------------------------------------------------------------------------------| | LRV 3349 Folio 12 Plot 17-19 Burton street. | | b. The Defendant shall grant vacant possession of the entire suit land. |

- The Plaintiff shall develop the suit land in accordance with the master plan, $\mathcal{C}_{\bullet}$ design and structural drawings to be approved by the Defendant, provided that the Defendant shall approve the same within 11 months from the date of execution of the consent. - d. The Defendant shall prepare a fresh sublease agreement within a period of one month for initial period of 49 years. - e. The Defendant acknowledges that the Plaintiff paid premium under the initial sublease agreement and shall not pay any further or new premium at the execution of a fresh sub-lease. - f. That the Defendant acknowledges that it demanded for and received a sum of Ugx 315,216,512 from the Plaintiff as outstanding ground rent for a period of 9 years and the sum shall be considered and applied to cover the future 9 years under the fresh sublease to be executed. - $g$ ..... - h. The consent judgment shall be deemed to be conclusively settled in the terms stated herein.

The Respondent's Counsel submitted that the consent judgment constitutes a contract; and that the Applicant ought to have enforced it by an ordinary suit.

According to Section $9(1)$ of the Contracts Act Cap.248, a contract is an agreement between parties with the intention of being legally bound. On the other hand, a consent judgment as 'a judgment of the court in terms which have been contractually entered into by the parties to litigation..." (Mubiru J. in Friedhelm Erwin Jost & Anor Vs Roko Construction Ltd & 2 Ors, HCMA No. 89 of 2021). It is further noted that unlike a contract, "a consent judgment" once recorded or endorsed by court becomes the judgment of the court and binding upon the parties..." (Mubiru J. in Friedhelm Erwin Jost & Anor Vs Roko Construction Ltd & 2 Ors, supra).

As Mubiru J., further noted in Visare Uganda Ltd vs. Festus Katerega $T/a$ Quick Way Auctioneers & Ors HC Misc. Application No. 591 of 2023, the classical distinction between a contract and a consent judgement is that "non-

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compliance with the consent decree (judgment) results in contempt of court, while failure to comply with a settlement agreement (contract) is simply a breach of contract."

From the above therefore, I disagree with Counsel for the Respondent that the consent judgment in issue is merely a contract which the Applicant could enforce by an ordinary suit. The said consent judgment has a force of law as any court order; and can be enforced in a contempt of court proceeding.

I am alive to the Respondent's assertion that there exists no sub-lessor- sublessee relationship between the parties. However, I consider that the assertion was dealt with by the consent judgment in HCCS No. 56 of 2016. The said judgment constitutes a judgment in rem, having conclusively settled decided the

rights of the parties (Mansukhalal Ramji Karia & Anor vs Attorney General SCCA NO. 20 OF 2002; Ms. Semuyaba, Iga & Co. Advocates & Anor vs Attorney General of South Sudan & Others HCMA No.004 of 2022). Therefore, this court cannot revisit the conclusions in the said consent judgment in this application.

Therefore, I find that the instant application is neither incompetent nor premature. Consequently, issue one is found in the negative; and the preliminary objections are accordingly overruled.

Issue 2: Whether the Respondent is in contempt of the consent judgment and decree in HCCS No. 56 of 2016?

Counsel for the parties submitted that the conditions for contempt of court are: a. A lawful order:

- b. The contemnor's knowledge; - c. Contemnor's ability to comply; and

d. The contemnor's failure to comply.

Counsel cited Sitenda Sebalu Vs The Secretary General of the East African Community, Ref. No. 8 of 2012; and Stanbic Bank (U) Ltd & Anor Vs the Commissioner General Uganda Revenue Authority HCMA No. 42 of 2010.

To succeed, the Applicant bears the burden of proving all the above conditions.

### Evaluation of the Evidence on the Conditions

Regarding condition (a), and (b); evidence shows that the parties entered a 240 consent agreement, and that it was approved by their Advocates in the presence of Judge before it was endorsed by court to be court a judgment and consequently decree. This was undisputed by the Respondent. Thus, I find that condition (a), and (b) above have been proved.

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| 245 | Concerning condition (c), there is no indication that the Respondent is not able to satisfy the terms of the consent judgment/decree as reproduced above. | |------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | 250 255 | I have taken note of the Respondent's averment regarding budgetary constraints. However, the satisfaction of all the terms in the decree, as reproduced above, requires no financial undertaking from the Respondent at all; implying that they can be performed notwithstanding any budgetary constraint the Respondent may have. Therefore, I am unable to find that the Respondent has no ability to comply with the terms of the decree in question. Accordingly, I find that condition (c) has been proved as well. | | | Regarding condition (d); it is a fact that the Respondent has neither granted vacant possession to the Applicant nor prepared a fresh lease in its favour, among others, as it was decreed in the consent judgment. | | 260 | It is also noted that whereas the Respondent recognised the Applicant's sublease in the suit property in the consent judgment/decree, it has questioned the same in this case. This is a clear demonstration of total disobedience of a court order. Consequently, I find that condition (d) has been proved as well. | | 265 | In conclusion, issue number two is found in the affirmative. Issue 3: Whether this is a proper application for grant of the consequential orders sought? | | 270 | The Applicant sought, in the alternative that the Respondent is unable to grant vacant possession of the suit land as set out in the consent judgement, a consequential compelling it to pay the Applicant compensation in lieu of its residual interest in the suit land in the sums of USD 5,098,592, among others. | | 275 | Counsel for the Respondent relied on Kanohiri Feddy Vs Tumusiime Rovina & Anor Misc. Application No. 336 of 2019; Mugerwa John Bosco & Anor Vs Mss Xsabo Power Ltd H. C. M. A No. 273 of 2018; and Pentecostal Assemblies of God Ltd Vs Joel Mukalu & Anor Misc. Application No. 290 of 2022 and contended that a consequential order is inevitable and consequent | | 280 | upon the judgement. He also argued that it must not be granted if it amounts to a fresh and unclaimed or unproven relief; and that an order of compensation of the Applicant is not the natural and automatic relief that flows from a consent judgment but instead, the Applicant should have filed a fresh suit to prove the breach and such an order. | | | |

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### Determination of the Issue

In Kalibala Vincent & others Vs. Attorney General H. C. M. A No. 70 of 2016 Musota J. (as he then was) defined a consequential order as an order of court giving effect to the judgement or decision to which it is consequential or resultant from. The Judge also observed that consequential orders are applied for where the court hands out a judgment but its implementation is impossible except with further orders.

In this case, the consent judgment grants the Applicant not only the right to enjoy the suit property but also orders that ensure the realization of that right. No evidence has been led to suggest that the implementation of the consent judgment, so as to realize the said right, is impossible. The implementation of the consent judgement can be achieved by ordering the Respondent to purge itself of the contempt by complying with its terms. The applicant shall apply for execution of the order of vacant possession if vacant possession is not voluntarily given by the Respondent.

Considering the above, I agree with Counsel for the Respondent that the alternative order of compensation, as sought, is not consequential to the consent judgment in question. Accordingly, I find this issue in the negative.

### Issue 4: What remedies are available to the parties?

In Conform Uganda Limited vs. Megha Industries (U) Ltd HCMA 1084 of 2014, it was held that court orders are not issued in vain and ought to be respected as long as they remain in force. From the above findings, the application partially succeeds on the following terms; -

(a) A declaration is granted that the Respondent acted in contempt of court by failing to comply with orders of the consent judgement vide Kagoda Farmers Limited Vs. Kampala Capital City Authority, Civil Suit No. 56 of 2016.

(b) The Respondent, being a Government Agency, is ordered to pay to the Applicant Ugx.30,000,000/- (Thirty Million Shillings Only) as punitive or exemplary damages, with interest at a rate of 8% per annum from the date of the ruling in this application until payment in full (In awarding the sum above, I have followed the principle that "exemplary damages are awarded where there is oppressive, arbitrary or unconstitutional action by the servants of the government ... ", Kibeedi Hussein Vs Hotel Triangle Ltd & Anor HCMA No. 128 of 2023).

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(c) An order that the Respondent purges itself of the contempt by complying with the terms of the above consent judgment within 6 months of the ruling.

(d) The costs of the application shall be paid by the Respondent.

Signed, dated and delivered at Kampala this. 13th day of ... $c$ 2025.

Nabakooza Fla Judge