Kambenkwine v Opportunity Bank Uganda Limited & Another (Miscellaneous Application 2736 of 2023) [2024] UGCommC 244 (9 July 2024)

## THE REPUBLIC OF UGANDA

## IN THE HIGH COURT OF UGANDA AT KAMPALA (COMMERCIAL DIVISION)

# **MISCELLANEOUS APPLICATION NO. 2736 OF 2023**

## ARISING FROM MISCELLANEOUS APPLICATION NO. 2227 OF 2023

(ARISING FROM CIVIL SUIT NO. 1135 OF 2023)

**KAMBENKWINE CHRISTOPHER ::::::::::::::::::::::::::::::::::::**

#### **VERSUS**

# 1. OPPORTUNITY BANK UGANDA LIMITED

# 2. KAMBE FLORENCE MAFARA::::::::::::::::::::::::::::::::::

### Before Hon. Lady Justice Patricia Kahigi Asiimwe **Ruling**

#### Introduction:

- The background to this case is that the Applicant instituted $\mathbf{1}_{\bullet}$ Civil Suit No. 0524 of 2023 against the Respondent seeking an order among others a permanent injunction restraining the Respondent from selling the suit property. The Applicant also filed Miscellaneous Application No. 2227 of 2023 seeking a temporary injunction restraining the Respondent from disposing of the suit property. The Application was dismissed. - $2.$ The Applicant brought this Application by way of Notice of Motion under section 37 of the Judicature Act, section 98 of the Civil Procedure Act and Order 50 Rule 8, Order 52 Rules 1 & 3 of the Civil Procedure Rules seeking orders that: - The Ruling and Order of the Registrar in Miscellaneous $\overline{a}$ Application No. 2227 of 2023 be reversed and substituted

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with an order granting Miscellaneous Application No. 2227 of 2023.

b) Costs of this Application be granted to the Applicant.

- The grounds of the Application are as follows: $3.$ - The learned Registrar erred in law and fact by failing to $a)$ properly consider the legal principles governing the grant of temporary injunctions, thereby erroneously dismissing the Applicant's application. - The learned Registrar erred in law and fact by failing to $b)$ consider the evidence presented in the Applicant's affidavit, which met all the requirements for granting a temporary injunction, thereby erroneously dismissing the application. - The learned Registrar erred in law and fact by concluding $c)$ that the application for a temporary injunction was merely to act as a stoppage of sale, thereby ignoring the Applicant's evidence regarding the alleged illegality of the mortgage. - The Applicant in his affidavit in support of the Application $4.$ stated as follows: - a) He purchased two adjacent plots of land in Namugongo— 40 decimals from Nalweyiso Madamalusi in 2006 (Block 185 Plot 387) and 60 decimals (Block 185 Plot 13284) in January 2022. He merged the two plots into a single fenced property and built his family home straddling both plots. On 8<sup>th</sup> January 2023, he discovered an advertisement in the Daily Monitor newspaper, announcing the sale of his property as mortgaged land. - b) In response, the Applicant filed Civil Suit No. 1135 of 2023 against the respondents, seeking a declaration that the mortgage granted to the second respondent by the first respondent is illegal and fraudulent. He also sought a

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permanent injunction to prevent the respondents or their agents from dealing with the disputed land. Additionally, he filed Miscellaneous Application No. 2227 of 2023 for a temporary injunction to halt the sale of Block 185 Plot 387 until the main suit is heard, and sought the costs of the application.

- c) The Registrar did not apply the principles necessary for granting a temporary injunction as prescribed by law, leading to an erroneous dismissal of his application. - d) That the registrar failed to consider the evidence provided in his affidavit, which met all the requirements for granting a temporary injunction. He also stated that the registrar incorrectly concluded that the temporary injunction would merely act as a stoppage of sale, disregarding the evidence of the mortgage's illegality presented in his affidavit. - In an affidavit in reply Ahumuza Julius the Respondent's legal $5.$ manager, stated that: - The learned registrar correctly applied the principles for $a)$ granting a temporary injunction and rightly dismissed the application. - The Application is merely an attempt to stop the sale of $b)$ the mortgaged property. That the applicant has never taken any steps to redeem the mortgaged property, despite consenting to the mortgage initially. - The purpose of a temporary injunction is to preserve the $c)$ status quo, but in this case, the application has been overtaken by events. That since filing the main suit, the Applicant has not taken any steps to prosecute it, indicating a lack of belief in its success.

#### Representation:

6. The Applicant was represented by M/s Barenzi &Co. Advocates, while the respondent was represented by M/s

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Byamugisha Gabriel & Co. Advocates and solicitors. Both parties filed written submissions.

#### Resolution

Ground 1: The learned Registrar erred in law and fact by failing to properly consider the legal principles governing the grant of thereby erroneously dismissing the injunctions, temporary Applicant's application.

The legal principles for granting of temporary injunctions in $7.$ Uganda was well settled in the case of E. L. T Kiyimba Kaggwa Versus Haji Abdu Nasser Katende [19851 HCB 43 where Odoki J held as follows:

The conditions for the grant of an injunction are:

- a) First that the applicant must show a Prima facie case *with a probability of success* - *b)* Secondly, such injunction will not normally be granted otherwise suffer appellant might the unless irreparable injury which would not adequately be compensated by an award of damages. - c) Thirdly if the court is in doubt, it will decline an application on the balance of convenience. - I have reviewed the decision of the learned Registrar and I find 8. that there is no evidence in the Ruling to show that she considered the above principles. - In the case of Housing Finance Bank Ltd Vs Silk Events Ltd 9. & Another Civil Appeal No. 0300 of 2021 court noted that:

Since the granting of an interlocutory injunction is a discretionary matter, appellate courts have limited their role. The appellate court must not interfere with the exercise of discretion merely on the ground that it would have exercised the discretion differently. There are two

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circumstances where the appellate Court will interfere *with the exercise of discretion namely; where the court at* first instance acted on wrong principles, and where the decision is manifestly absurd or unreasonable that a misapplication of a wrong principle is inferred. To interfere, there must be a clear mistake in the law or the *evidence, or some other glaring error.*

(Also see the case of Nakato Margaret V Housing Finance Bank LTD & Anor Civil Appeal No.0687 of 2021)

10. I find that the learned Registrar misdirected herself when she resolved the matter without evaluating the principles for grant of temporary injunctions. The question then is whether she arrived at the wrong decision. I will therefore review the evidence to determine whether the Application meets the principles for the grant of a temporary injunction.

#### Prima facie case

- 11. The Black's Law Dictionary 8<sup>th</sup> Edition page 3767 defines prima facie as what is determined "at first sight; on first appearance but subject to further evidence or information." - 12. In the case of Godfrey Sekitoleko & others V. Seezi Peter Mutabazi and Others [2001 - 2005] HCB 80 cited in Akello Olak & Others V Bonnie S Rwamukaaga Misc Application No. 0127 of 2019, it was held that for a prima facie case to be found, what is required is for the court to be satisfied that the claim is not frivolous or vexatious and that there are serious questions to be tried. - 13. In the case of **Kigongo Edward Nakabale Vs. Kakeeto Rogers** & Another Misc. Application No. 144 of 2017, Musene J held that a prima facie case with a probability of success is no more than that the Court must be satisfied that the claim is not frivolous or vexatious. In other words, there is a serious question to be tried.

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- 14. In the case of Ndungo Seti & Others V Sekiziyivu Sammy Jones & Another Civil Suit No. 286 of 2011 Court held that "Frivolous connotes the absence of seriousness or the lack of validity or legitimacy." The court further held that a vexatious case is oppressive to the opposing party, obstructs the court from gaining a full understanding of the issues and a party acts with an ulterior motive. - 15. In Robert Kavuma vs M/S Hotel International SCCA No. 8 of 1990 Wambuzi CJ as he then was stated that an Applicant for a temporary injunction is required to show a prima facie case and a probability of success but not success. - 16. The Applicant contends that the 1<sup>st</sup> Respondents advert is misleading because it includes plot 387 which was not mortgaged. - 17. I have looked at the advert and the property is described as 13284 LAND 185 PLOT $AT$ **NAMUGONGO** "BLOCK DEVELOPED WITH A STORIED RESIDENTIAL HOUSE AND OTHER HOUSES AND GARDENS MEASURING APPROX. 0.2570 HECTARES IN A PERIMETER WALL." - 18. The advert does not mention plot 387, however none the less if it is indeed true that the description covers both plots then the Applicant does indeed raise a triable issue.

#### *Irreparable injury*

19. In the case of American Cynamid V Ethicon [1975] 2 WLR **316**, the court held that:

> The governing principle is that the court should first consider whether if the Plaintiff were to succeed at the trial in establishing his right to a permanent injunction he would be adequately compensated by an award of damages for the loss he would have sustained as a result

of the Defendant's continuing to do what was sought to be enjoined between the time of the Application and the time of the trial. If damages in the measure recoverable at common law would be an adequate remedy and the defendant would be in a financial position to pay them, no Interlocutory Injunction should normally be granted..."

- 20. In the case of Kiyimba Kaggwa Vs. Katende Abdu Nasser (supra), the court held that irreparable injury does not mean that there must not be the physical possibility of repairing the injury, but means that the injury must be a substantial or material one, that is, one that cannot adequately be compensated for in damages. - 21. I find that the Applicant can be compensated in damages for loss in the event that the sale is not lawful. I note from the Plaint and Written Statement of Defence that the 2<sup>nd</sup> Respondent and the Applicant are married. Secondly, the 2<sup>nd</sup> Respondent took the loan in issue and it was secured by Block 185 Plot 13284 and the Applicant guaranteed the loan.

#### Balance of convenience

22. It was held in the case of GAPCO Uganda Limited V. Kaweesa H. C. Misc Application No. 259 of 2013 that "the term balance of convenience literally means that if the risk of doing an injustice is going to make the applicants suffer then probably the balance of convenience is favorable to him/her and the Court would most likely be inclined to grant to him/her the application for a temporary injunction."

## 23. In the case of **Makune James & Others Vs Bulikarara Joseph** & Ano Civil Appeal No. 0091 of 2022 Wagona J, held that:

Therefore, in arriving at the proper decision on whether the balance of convenience favours the applicant or not, the court must weigh the loss or risk of exposure for the

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applicant in the event the injunction is denied and the damage which could be suffered if it is not granted. In my view court should equally examine the prejudice and the injury the respondent is likely to suffer if the injunction is granted and the possibility of other avenues of addressing the applicant's fears and claims without necessarily granting the injunction.

- 24. In the instant case the damage the Applicant may suffer as a result of denying the application for an injunction can be compensated in monetary terms. Therefore, the balance of convenience is favourable to the Respondents. - 25. Therefore, while the learned Registrar erred in law by failing to properly consider the legal principles governing the grant of temporary injunctions, I find that the application does not meet the principles for the grant of temporary injunctions. The ground therefore fails. - 26. In light of the above I have not found it necessary to consider the other grounds. The Application is therefore dismissed with costs.

### Dated this 9<sup>th</sup> day of July 2024

trading,

Patricia Kahigi Asiimwe

Judge

Delivered on ECCMIS