Kavuma v Vivo Energy Uganda Limited (Civil Suit 25 of 2021) [2023] UGHC 328 (28 February 2023)

## **THE REPUBLIC OF UGANDA**

## **IN THE HIGHCOURT OF UGANDA AT MASAKA**

## **CIVIL SUIT NO. 25 OF 2021**

## **KAVUMA HASSAN ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: PLAINTIFF**

## **VERSUS**

## **VIVO ENERGY UGANDA LIMITED**

**Formerly SHELL (U) LIMITED :::::::::::::::::::::::::::::::::::::::::::::::: DEFENDANT**

*Before; Hon Justice Victoria Nakintu Nkwanga Katamba*

## **JUDGEMENT**.

# **BACKGROUND**

The Plaintiff instituted this suit against the defendant for recovery of physical possession of land comprised in Buddu Block 753 Plot 7, Mutukula road measuring approximately 0.15 Hectares.

The Plaintiff stated that he leased his land to the Defendant and that before expiry of the leasehold in 1998, the defendant registered a caveat on the Plaintiff's land for recovery of a debt of UGX. 101,000,000/= owed by the Plaintiff to the Defendant.

The Plaintiff further pleaded that on account of the debt of UGX. 101,000,000/=, the Plaintiff mutually allowed the defendant to stay on his land and keep possession of the same for a further period of fifteen years from the expiry of the ten years leasehold. Effectively, the Plaintiff allowed the defendant to stay on his land up to and until 2017.

The Plaintiff is aggrieved that the Defendant has detracted from the mutual agreement, over stayed on the land thereby occasioning him loss of rental income. It is against this background that the Plaintiff instituted the instant suit.

In its defence, the defendant stated that the Plaintiff as a dealer of a petrol station on the suit land accumulated debts with the defendant on account of credit petroleum supplies.


The defendant further pleaded that to recover the trade debts, it filed Civil Suit No. 1016 of 2000 (Shell Uganda Ltd vs. Hassan Kavuma) which suit was settled in terms that the Defendant's lease on the suit land be extended on full payment basis to 30 years effective 4th May 2017. A copy of the Plaint, Decree and Memorandum of Settlement/Consent Judgment and a deed of acknowledgement alleged to have also been executed by the Plaintiff were both annexed to the defence and tendered in court as defence exhibits.

Against the above background, the Defendant stated that the Plaintiff is estopped from making his claims and that his suit is a gambling afterthought. It prayed that the suit be dismissed with costs.

#### **Representation:**

The Plaintiff was represented by **M/s Nyanzi Kiboneka & Mbabazi Advocates**

The Defendant was represented by **M/s S & L Advocates**.

## **ISSUES FOR TRIAL**.

At scheduling the parties agreed to the issues below for trial

- **1. Whether the suit is res judicata?** - **2. Whether the defendants have a subsisting lease on Mailo register comprised in Buddu Block 753 Plot 7, Mutukula Road?** - **3. Whether the Plaintiff paid off the UGX. 101,000,000/= debt in 1998 through mutual extension of the lease by 15 years?** - **4. Whether the Defendant acted fraudulently by filing HCCS No. 1016/2000?** - **5. Whether the extended lease of 30 years by the defendant on the suit property was legally obtained?** - **6. Whether the Plaintiff's claim for rental income, mesne profits and user earnings as against the defendant is justified?** - **7. What are the remedies available to the parties?**


#### *DETERMINATION OF THE SUIT.*

The parties in this suit filed written submissions. I commend them for the effort. Whereas I have carefully examined the pleadings, evidence and the submissions of the parties, I have not restated their submissions in their entirety but will, however, refer to the said submissions of the parties from time to time when deemed necessary.

## **ISSUE 1: Whether the suit is res judicata?**

*Res judicata includes two related concepts: claim preclusion and issue preclusion. The former focusses on barring a suit from being brought again, and on a legal cause of action that has already been finally decided between the parties or sometimes those in privity with a party; while the latter bars the re-litigation of factual issues that have already been determined by a Judge or jury as part of an earlier claim. See Court of Appeal Civil Appeal No. 51 of 2007 General Industries (U) Ltd vs. Non-Performing Assets Recovery Trust & Ors.*

The Defendant submitted that the question of the Plaintiff's indebtedness to the Defendant is the nucleus on which this case turns. The Defendant further submitted that if this court finds that the question of the defendant's indebtedness was settled in HCCS No. 1016 of 2000, it would naturally follow that the claims in this suit are baseless.

*S.7 of the Civil Procedure Act Cap.71 provides that No court shall try any suit or issue in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit between the same parties or between parties under whom they or any of them claim, litigating under the same title, in a court competent to try the subsequent suit or the suit in which the issue has been subsequently raised and has been heard and finally decided by that court.*

The plaintiff's counsel is well aware of the rule and has correctly cited the case with the conditions that must be fulfilled for res judicata to be established, *Ganatra v, Ganatra [2007] 1 EA 76 at page 82 to wit;*

- *a) That there was a former suit or proceedings in which the same parties as in the subsequent suit or proceeding was litigated;* - *b) That the matter in issue in the later suit must have been directly and substantially in issue in the former suit;*


# *c) That a court competent to try it had heard and finally decided the matters in controversy between the parties in the former suit.*

On the first condition, this court is satisfied that there was a former suit between the same parties, HCCS No. 1016/2000 in the commercial division of this court. A copy of the Plaint, the Memorandum of Settlement in execution and a certified copy of the Decree which is dated 26th September 2001, duly signed by the retired Hon. Lady Justice Flavia Anglin when she was still a Deputy Registrar of the court is on record. The Decree also bears the seal of this court.

On the second ground; that the issue before this court was also substantially in issue in the former suit; the Plaintiff disputes that the same issue of its indebtedness is before this court. He instead refers this court to his cause of action.

This Court has perused the Joint Scheduling Memorandum Plaintiff executed by the Plaintiff and his Advocates with the defendant in which they agreed to the issues for trial. Issues No. 3 states thus, *"Whether the Plaintiff paid of the UGX. 101,000,000/= debt in 1998 through mutual extension of the lease by 15 years?"* This issue is contained in the Scheduling memorandum of the parties as endorsed by their respective Advocates on the 8th day of September 2021 and filed in this court on 9th November 2021.

According to DEX1 which is a plaint in respect to the earlier suit between the parties in paragraph 5 it is stated and I quote, "During the course of 1998 the Plaintiff supplied to the defendant petroleum products worth Shs. 90,306,115/= on credit for which the defendant was required to pay immediately (A photocopy of the statement of account is attached as A)"

In the same exhibit DEX1, paragraph 6 demonstrates delivery of the said products and the attendant receipt entries for the goods while paragraph 7 demonstrates that the Plaintiff had hitherto made incessant demands to the defendant for payment of outstanding monies to no avail.

The above facts as can clearly be seen in this specially endorsed plaint in the summary suit under *Order 33 r1 and 3 which has since been amended to now be Order 36 of the Civil Procedure Rules* all point to one fact; that the same issue concerning the Plaintiff's indebtedness exists in both suits.


In the premises, the second ground has been proved. The matter in issue in this suit being the Plaintiff's indebtedness to the Defendant was directly and substantially in issue in Civil suit No.1016 of 2000.

In respect to the 3rd ground; That a court competent to try it had heard and finally decided the matters in controversy between the parties in the former suit.

DEX2 is a certified true copy of a Decree that was endorsed by the now retired Hon. Lady Justice Flavia Anglin while still serving as a Deputy Registrar of this court on 26th September 2001. According to this Decree, the parties agreed that the Judgment Debtor would extend the Judgment Creditor's lease for a period of 30 years effective 4th May 2017 and that the same should be registrable immediately as an addition to the period of the running lease. As consideration for the 30year lease term, the Judgment creditor offered to set off the award of UGX. 92,598,677/= as the aggregate payment of premium and rent for the entire extended lease period of 30 years.

The above Decree was drawn from DEX3, which is the Memorandum of Settlement made on the 11th day of September, 2001 between Shell(U) Ltd and Hassan Kavuma, the Plaintiff herein. The subject of the Memorandum in DEXh3 is the Defendant/judgment Debtor, Hassan Kavuma's indebtedness to Shell(U) Ltd and the agreement between the parties to settle the decretal amount by extending the Plaintiff's/Judgment Creditor's lease on land comprised in Mailo Block 753 Plot 7 land at Mutukula Road for a further period of thirty years running from 4th May, 2017. It was also agreed between the stated parties that the lease would be registrable immediately by adding it to the residue period of the existing/running lease. In addition to this, DEXh3, the Memorandum of Settlement, was executed under *Order 19 rule 2 of the old Civil Procedure Rules. Its equivalent today is Order 22 rule 2 under execution of Decrees.*

#### *Order 22 rule 2(1) of the CPR provides that*,

*Where any money payable under a decree of any kind is paid direct to the decree holder or the decree is otherwise adjusted in whole or in part to the satisfaction of the decree holder, the decree holder shall certify the payment or adjustment to the court whose duty it is to execute the decree, and court shall record the payment or adjustment accordingly.*

*(2)"the Judgment debtor also may inform the court of such payment or adjustment and apply to the court to issue a notice to the decree holder to show cause, on a day to be fixed by the court,*


*why the payment or adjustment should not be recorded as certified and if after service of the notice, the decree holder fails to show cause why the payment or adjustment should not be recorded as certified, the court shall record it accordingly."*

The Plaintiff in the instant suit was part of the elaborate process that led up to the judgment and decree in Civil Suit No.1016 of 2000. After the suit was instituted against him, by a letter dated 5/9/2001, he wrote to Shell(U) ltd making a debt payment proposal. His proposal was forwarded by facsimile dated 6th September,2001 to Mr. Faisal Mukasa of F. Mukasa & Co. Advocates by the then Company Secretary of Shell(U) ltd, Ms. Mariam Nampera Mbowa for implementation. A Memorandum of Settlement to which the Plaintiff herein was a party was drawn and signed by the parties on the 11th day of September, 2001. It was endorsed by the Court and sealed on 26th day of September, 2001.

It is against this background that this court finds that a court competent to try the matter between the parties in Civil Suit No.1016 of 2000 heard and finally decided the matters in controversy between the parties in it.

Lastly, the Plaintiff was given adequate notice of the suit that was determined earlier between the parties and the Plaint, Decree and Memorandum of Settlement were all clearly annexed to the Defendant's Written Statement of Defence. The same documents were also enclosed in the Defendant's trial bundle. The Plaintiff therefore had the opportunity to plead on the Decree and the Memorandum of Settlement between the parties while filing his reply to the Written Statement of Defence. He however made no mention at all on the Memorandum Of Settlement and did not deny its execution.

During hearing of the Defendant's case, counsel prayed that the defendant's documents in the trial bundle be admitted on the court record as their evidence. The Plaintiff and his counsel still did not raise any objection as to the authenticity of the Memorandum of settlement in HCCS No. 1016/2000, particularly as regards the fact that it is the Plaintiff's document as well because it bears a signature attributable to him.

This memorandum was duly endorsed by the Deputy Registrar of this court on 26th September 2001. Whereas it was named a Memorandum, *it is a consent Judgment duly provided for under Order 25 r2 of the Civil Procedure Rules.* It is binding on the parties and it can only be set aside


on such grounds as would vitiate an agreement/contract, *See Attorney General & Anor Vs Mark Kamoga & Anor SCCA No. 8 of 2004, Mulenga JSC*

It is worth noting, however, that this suit has not been brought to set aside the Consent Judgment of the parties notwithstanding the fact that it would have a similar effect, if were to be successful.

The Plaintiff cited the case of *Maniraguha Gashumba vs. Sam Nkundiye Civil Appeal No. 23 of 2005 for the proposition that for a party to successfully plead res judicata, such party must as a requisite produce in court a duly certified copy of the Judgment as evidence to prove that the subject matter before court has been directly, substantially and finally determined in the latter case. Additionally, that pleadings and a decree do not suffice in proving that a matter is res judicata other than a duly signed and certified Judgment from a court competent to try the matter.*

The Plaintiff submitted that since in the instant case, there is no Judgment signed and certified on the record, the defendant had not proved res judicata.

As earlier stated HCCS No. 1016/2000 was a suit brought under the summary procedure unlike the one which was considered as the subject of appeal in *Maniraguha case*( supra). The practice in Summary procedure is that once the Defendant does not enter appearance to show cause why default Judgment should not be entered against him, court enters a summary default Judgment on the record and issues a Decree. There is no need to write a formal Judgement is done after hearing of a full trial.

The other distinguishing factor of the instant case from the *Maniraguha i*s that in the latter case an unsigned and undated Judgment was sought to be relied on while in the instant case, the Defendant has adduced a certified copy of the Decree not just on determination of the suit but determining execution of the Decree, that is DEX2. The Defendant has also adduced a consent Judgment/ Memorandum of Settlement, DEX3 which bears an undisputed signature that is attributable to the Plaintiff and duly witnessed by the Deputy Registrar of this court with her signature and seal of this court.

HCCS No. 1016/2000 between the parties was determined by this court which is well vested with unlimited original Jurisdiction under Article 139 of the Constitution of the Republic of Uganda. It was competent to try the matter even as it still is vested with the same competence.


Having found that the parties in both suits are the same, the same issue of the defendant's indebtedness is common to both suits and that the court that tried the earlier suit was vested with jurisdiction, this Honourable court concludes that the instant suit is res judicata HCCS No. 1016/2000 and there is a bar at law to re-opening it.

I did not find it necessary to re-state the submissions of the parties on all the issues because as can be seen, the suit has been settled on the first issue.

*S. 3(3) of the Limitation Act Cap. 80 provides that an action shall not be brought upon any Judgment after expiration of twelve years from the date on which the Judgment became enforceable.* The Consent Judgment/ Memorandum of Settlement between the parties became enforceable on 26th day of September 2001 when it was endorsed by the Deputy Registrar of this court. The instant suit was filed on 19th March 2021, nearly 20 years thereafter.

This court is of the firm view that the instant suit was a clever, disguised challenge to the Consent Judgment of the parties in HCCS No. 1016/2021, contrary to the law.

The issue is answered in the affirmative.

# **Issue 3: What remedies are available to the parties?**

The suit is hereby dismissed with costs to the defendant.

I so order.

Dated at Masaka this 28th day of February 2023. *\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_*

*Victoria Nakintu Nkwanga Katamba, Judge.*