Lukyamzi Investments Limited and 4 Others v Kampala Capital City Authority and Another (Miscellaneous Application 2277 of 2024) [2025] UGHCLD 44 (13 March 2025)

Full Case Text

#### THE REPUBLIC OF UGANDA

# IN THE HIGH COURT OF UGANDA AT KAMPALA

# **LAND DIVISION**

## **MISCELLENOUS APPLICATION NO. 2277 OF 2024**

## (ARISING FROM CIVIL SUIT NO. 930 OF 2021)

#### 1. LUKYAMUZI INVESTIMENTS LIMITED

- <table>

2. DKS UGANDA LTD ::::::::::::::::::::::::::::::::::: - 3. KEY & HAM INVESTIMENTS LTD - 4. ABAMWE TRANSPORTERS LTD - 5. KABALE DISTRIBUTORS LTD

# **VERSES**

# 1. KAMPALA CAPITAL CITY AUTHORITY

2. THE ATTORNEY GENERAL ::::::::::::::::::::::::::::::::::::

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

The Applicants brought this application against the Respondents by way of notice of motion under Section 33 of the Judicature Act, Section 34 (1) and 98 of the Civil Procedure Act, Order 52 rules 1, 2 and 3 of the Civil Procedure Rules seeking the following orders;

a. A declaration that the Respondents acted in contempt of the consent judgment endorsed by this court on $10/02/2022$ in so far as the Respondents have consistently and deliberately refused to-date, to grant vacant possession of the suit land to the Applicants and to allow the Applicants to cause developments thereon or otherwise compensate the Applicants for their residual interests in the terms envisaged under the consent judgement to wit; -

Land currently comprised in LRV KCCA2 Folio 4 Plot 35-37 Ben Kiwanuka Street, measuring approximately $0.058$ Hectares ( $0.143$ acres) (formerly described as Kyadondo LRV 3349 Folio 19, Plots No. 35-37 then measuring approximately 0.079 acres) with a current market value of USD $$3,233,377$ and land currently comprised in LRV KCCA2 Folio 3 Plot 31-33 Ben Kiwanuka Street, measuring approximately $0.058$ Hectares ( $0.143$ acres) (formerly Kyadondo LRV 3349 Folio 18, Plot 31-33 measuring approximately 0.143 acres) with a current market value of USD $$$ 3,234,219 to Lukyamuzi Investments Limited, the 1st Applicant.

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- Land currently comprised in LRV KCCA2 Folio 2 Plot 9-15 Burton Street ii. measuring approximately 0.135 Hectares (0.334 acres), formerly described as Kyadondo LRV 3316 Folio 17, Plots 9-15, Burton Street then measuring approximately 0.241 acres, with a current market value of USD \$7,238,389 to DKS Uganda Limited, the 2nd Applicant. - Land currently comprised in LRV KCCA1 Folio 25 Plot 23-25 Ben iii. Kiwanuka street, measuring approximately 0.058 Hectares (0.143 acres) formerly described as Kyadondo LRV 3349 Folio 16 Plots 23-25 Ben Kiwanuka street measuring approximately 0.143 acres, with a current market value of USD 3,233,377, to Key and Ham Investments, the 3rd Applicant. - Land comprised in KCCA2 Folio 1 Plot 27-29 Ben Kiwanuka Street iv. measuring approximately 0.055 Hectares (0.136 acres) formerly described as Kyadondo LRV 3349 Folio 17 Plots 27-29 Ben Kiwanuka Street, then measuring approximately 0.095 acres, with a current market value of USD \$ 3,066,134 to Kabale Distributors Limited, the 5th Applicant. - Land comprised in KCCA 2 Folio 5 Plot 21-23 Burton Street, measuring $\mathbf{V}.$ approximately 0.067 Hectares (0.166 acres) formerly described as Kyadondo LRV 3349 Folio 13 Plots 21-23 Burton street measuring approximately 0.097 acres, with a current market value of USD \$ 3,592,386 to Abamwe Transporters Limited, the 4th Applicant. - b. An order of a punitive/ exemplary measure in a sum of Ugx 1,000,000,000/-40 (One Billion Shillings) and interest thereon, from the date of filing this application against the Respondents for their intransigence and contemptuous conduct towards this court's orders. - c. An order doth issue against the Respondents compelling them to purge their contempt by immediately granting vacant possession of the suit land to the Applicants to enable the Applicants develop the suit land in the terms of the consent judgement. - d. That in the alternative, in the event that the Respondents are no-longer able to grant vacant possession of the suit land to the Applicants in the terms of the consent judgment, a consequential order doth issue against the Respondents compelling them to pay the Applicants' compensation in lieu of their residual interests in the suit land in the sums reflected herein above against each Plot, being the current market value of the land, together with interest thereon at the court's rate from the date of the order till payment in full. - e. Costs of the application be provided for.

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$20$

This application is supported with the affidavit supported by the affidavit of Mr. Emmanuel Lukyamuzi (the 1st Applicant's Director) with written authority from the 2nd, 3rd, 4th and 5th Applicants, together with that of Opito Moses (a valuation surveyor). Briefly, it is averred that; -

The Applicants filed HCCS No. 930 of 2021 against the Respondents seeking for; a declaration that the Plaintiffs/Applicants as the respective registered lessees of the suit properties are entitled to vacant, quite possession, among others. That the parties entered into a consent judgment/decree which was duly endorsed by court on $10/02/2022$ with terms that the Respondents grant vacant possession of the suit land upon execution of the consent and allow the Applicants cause temporary developments; and that if upon expiry of 12 months from the date of the consent the Applicants are not compensated for their residual interest, the Respondents would either process compensation or approve the Applicants' plan for construction of permanent structures on the suit land.

That a meeting was then arranged by the Respondents, including the Minister for Kampala, the Executive Director of the 1st Respondent and the Resident City Commissioner and it was agreed that the Respondents would avail security and other enforcement that would facilitate the handover of vacant possession but this was frustrated by police and other law enforcement agencies who blocked the Applicants from taking possession of the land to date. That the 1st Respondents resurveyed the suit land taking into account available and usable land on ground and executed new leases, instructed the office of the Commissioner for Land Registration to issue new leasehold certificates of title in favor of the Applicants which has been concluded but the Respondents have failed to grant vacant possession.

That despite several communications from the Applicants, the Respondents have in blatant disregard to the judgement and decree failed to grant access and vacant possession of properties decreed to the Applicants in fulfillment of the consent judgment and the 12 months have lapsed hence rendering it desirable for consequential orders compelling the Respondents either to grant vacant possession or to pay compensation in lieu of the Applicant's land at the market value in order to effect the judgment and decree of court. That it is in the interest of justice that 90 the Application is granted otherwise the consent judgment/decree is unlikely to be complied with.

Both Respondents filed separate affidavits in reply. The 1st Respondent, through an affidavit of Nathan Asanasio Kasule (Manager Land Management unit), deposed that

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the breach of the consent judgment gives rise to a suit but not a contempt application since the Applicants are claiming a compensation of Ugx 58,000,000,000/- (Fifty-Eight Billions) as the value of the respective leasehold interest, which can only be determined in an ordinary suit and not by affidavit evidence like in this case. That the parties intend to explore an amicable agreement by extending the compensation or period of approval as stipulated in the consent judgment and that the application is premature. That this court is duty bound to promote reconciliation of the parties by requiring parties to explore an amicable resolution of the issues. That failure to grant vacant possession is actionable as a cause of action rather than a matter of contempt of court.

He deponed further that, there is a will on the part of the 1st Respondent to comply with the consent judgement as seen in the issuance of fresh leases. That the Respondents did not deliberately refuse to grant the Applicants vacant possession but there are financial constraints hindering full compliance with the consent 110 judgment. He averred further that, the 1st 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 masterpiece for the old taxi park but that due to budgetary constraints, it shall be completed in 2026. That the Applicants' intended developments are subject to the old taxi park 115 development master plan.

Mr. Emmanuel Olango Achellam (a state attorney in the 2nd Respondent's chambers) opposed the application on grounds that the 2nd Respondent has undertaken efforts to comply with the consent judgment by conducting detailed assessments to ensure safe and lawful transfer of possession; organising meetings with the Applicants to facilitate a smooth handover and confirming support measures including police security to aid the possession process; reviewing the proposed developments to confirm adherence to city planning standards as necessitated by Kampala Capital City regulatory mandate.

Further, that the process of granting vacant possession of the suit property has faced unforeseen obstacles like its location and public use of the surrounding which require coordination with the law enforcement agencies and land survey adjustments. He corroborated further that the Respondents undertook actions by issuing new leasehold title reflecting the revised boundaries as a way of demonstrated willingness to comply with the court directives. That the Respondents remain committed to upholding the count's orders, fulfilling the terms of the

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consent judgement, handover the revised plots, facilitate the intended developments and explore compensatory options in case of unusable land.

In rejoinder, it was the Applicants' case that the claims in HCCS No. 930 of 2021 from which the instant application arises were determined by consent judgment which is a judgement in rem and that the same facts cannot be re-litigated by way of a fresh suit. That the terms of the consent judgment not only constitute contempt but calls for issuance of consequential orders since the Respondents have not granted vacant possession of the suit land. That the application is not seeking orders for an award of general or special damages but for compensation as envisaged in the consent judgement.

The Applicants averred further that the period within which the parties were to explore options of amicable settlement lapsed and that the issuance of subleases without granting possession and permission to develop the suit land as envisaged in the consent judgement does not amount to compliance. That ever since the issuance of the fresh leases, the Respondents have not taken further steps nor commitment on compliance with the court order. That the Respondents have neither attached any contrary evidence disputing the value of the suit land nor led any evidence to support the averment that the master plan would be completed in 2026.

#### **Legal Representation** 155

The Applicants were represented by Counsel Joseph Kyazze, the 2nd Respondent was represented by Counsel Muwonge Mark while the 1st Respondent was represented by counsel Deus Byaruhanga.

Counsel for the Applicants raised the following issues for resolution;

a. 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?

- b. Whether the Respondent is in contempt of the consent judgment and decree in HCCS No. 930 of 2021? - c. Whether this is a proper application for grant of the consequential orders sought? - d. What remedies are available to the parties?

### Submission by Counsel.

Issue I. 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?

Counsel for the Applicants cited the case of Dison Okumu & Ors Vs Uganda Electricity Transmission Co. Ltd & Ors SCCA No. 18/2020 and argued that

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once a consent is entered and the court endorses the same, it becomes an effective court order or decree. That the court became functus officio once it endorsed the consent agreements and passed a decree or order hence implying that filing a new suit to seek the very remedies, which were granted by court upon endorsement of the consent judgment, would render the suit res-judicata. Counsel also cited the case of Kateregga George William Vs Commissioner Land Registration Misc. Application No. 347 of 2013 to contend that the consent judgment was a judgment in rem which determined the rights of the parties. That the Applicants being the successful decree holders are not required to file a fresh suit in order to enforce satisfaction of the judgement/decree but entitled to bring this application to enforce satisfaction of the decree.

Counsel further relied Sinba (K) Ltd & Ors Vs Uganda Broadcasting 185 Corporation (SCCA No. 3 of 2014) and argued that the Applicants have 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. He also submitted that the continued failure by the Respondents to adhere to the terms of the consent is not a breach of 190 contract but contempt of court.

In reply, Counsel for the 1st 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 195 that it is the position of the law that judgement entered on the agreement of the parties, sanctioned by court constitutes a contract between parties to the agreement and that the Applicants are erroneously treating contempt of court as an ordinary mode of executing a decree. He further cited the case of David Onen & 2 Ors Vs Ocan Otto & 2 Ors Misc. Application No. 131 of 2019 where Justice Stephen 200 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

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13-03-2025 ### therefore be used cautiously and with great restraint. It is an enforcement power of last rather than first resort.

Counsel further cited Section 61 (a) of the Contracts Act Cap 284 and argued that a breach of contract leads to an ordinary suit and that the contract in this case has a provision requiring the parties to amicably agree to the extension of the period for compensation and/or approval of plans. That a claim of over Ugx 58,000,000,000/being the alleged value of the leasehold plots is contentious and requires parties to call their witnesses. That this renders the contempt application incompetent and premature. Counsel submitted that the application should be dismissed with costs.

#### Determination of the issue.

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 220 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..." 225 (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 230 classical distinction between a contract and a consent judgement is that "noncompliance 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."

Therefore, in view of the above I disagree with the Respondents that the consent 235 judgment in issue is merely a contract which the Applicants can enforce by an ordinary suit. Considering the authorities above, the said judgment has a force of law as any court order; and can be enforced in a contempt of court proceeding. Accordingly, I find that the instant application is neither incompetent nor 240 premature. Consequently, issue one is found in the negative.

> Issue 2. Whether the Respondent is in contempt of the consent judgment and decree in HCCS No. 930 of 2021?

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In Erasmus Masiko Vs John Imaniraguha & Ors M. A No. 1481 of 2016, it was held that the following ingredients must be proved to succeed on a contempt of court application:

- *a*. The existence of a lawful court order; - The potential contemnors knowledge of the order; *b.* - The potential contemnors ability to comply; and $\mathcal{C}.$

The potential contemnor's failure to comply. d.

# (See also Sitenda Sebalu Vs The Secretary General of the East African Community Ref. No. 8 of 2012, cited by the Applicants' Counsel).

According to evidence on record and submissions of Counsel for the parties, it is undisputed that there exists a lawful order granted by this court; and that it is within the knowledge of the parties. Therefore, I find that ingredients (a) and (b) above have been proved.

I shall now determine the existence of ingredients (c) and (d).

With respect to (c); under clause 1 of the consent judgment, the Respondents were bound to grant vacant possession to the Applicants "immediately upon execution..." of the consent judgment (reference is made to the consent judgment).

The 1st Respondent averred, and its Counsel submitted that due to financial constraints, the Respondents have failed to grant the Applicants vacant possession of the suit land. However, it is inconceivable that the Respondents require a financial undertaking to fulfill clause 1 of the said judgment. The understanding of the parties at the time of endorsement of the consent judgment was that the 1st Respondent was in possession of the suit properties. This view is further supported by the fact that the suit properties were a subject of a temporary injunction which, among others, restrained the Respondents from "giving away possession" of the suit properties. (reference is made to the order of temporary injunction).

Therefore, all the Respondents needed to do, in fulfillment of clause 1, was handing over possession of the suit properties to the Applicants. It is likely that they were aware of their ability to do so and that this is why they agreed to grant the same "immediately upon execution of..." of the consent judgment, otherwise they would not have consented to a term they were unable to satisfy. Thus, it is in bad faith for them to claim now that their financial constraint is the cause for their inability to satisfy clause 1 of the consent judgment. Accordingly, I find that element (c) has been proved, particularly with regard to the said clause 1.

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I am mindful that the consent judgment has other clauses; though only clause 9 merits consideration since it involves a financial undertaking by the Respondents, which is; to compensate the Applicants for their residual interests in the suit properties. According to the clause, compensation was agreed to as an alternative to ownership of the suit properties by the Applicants, and it was to be done by the Respondents within 12 months of the endorsement of the consent judgment during which period the Applicants were to operate "on their plots using temporary structures only" (reference is made to the consent judgment). The same clause also mandated the parties to agree with a view to adjusting the period of compensation, among others, if the 12 months lapsed without compensation.

I note that Counsel for the 1st Respondent submitted that the Applicants have not offered an explanation why they did not engage in an amicable settlement in resolution of the matter or attempt to comply with clause 9 of the judgment. It should be noted that the dictate in clause 9, and the Respondent's financial constraint, would be material points only if the Respondents had granted the Applicants vacant possession of the suit properties immediately after endorsement of the consent judgment. This position is based on the fact that the parties' understanding envisaged that the Respondent would exercise the option of compensating the Applicants, or that the parties would agree on adjusting the period within which compensation was to be done, when the Applicants are already in possession of their respective plots. For that reason, it is only proper to consider the former party's failure to grant the latter vacant possession as sufficient demonstration of its lack of any will to satisfy the terms of the consent judgment. Thus, the Respondents are estopped from entreating the conditions under clause 9 as justification for their inability to comply with the terms of the consent judgment. I now turn to element $(d)$ .

With respect to the same, it is my finding that the preceding observations point to 310 its existence by necessary implication. To that extent, it is trite law "a court order is a court order. It must be obeyed as ordered unless set aside or varied" (Court of Appeal Civil Application No.109 of 2004: Amrit Goyal vs. Harichand Goyal & 3 Others).

In this case, the Respondents were duty bound to obey clause 1 of the consent 315 judgment. I place so much emphasis on clause 1 simply because its satisfaction would not only have demonstrated the will on part of the Respondents to comply with the consent judgment but also offered a basis for a good explanation of their

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inability to comply with the rest of the clauses. As the analysis has detailed, there was no such will hence total failure to comply.

In conclusion, the four elements stated above having been proved, I find the Respondents in contempt of the consent judgment and decree in HCCS No. 930 of 2021. This answers the issue in the affirmative.

$\mathcal{L}_{\mathcal{L}}$

## Issue 2. Whether this is a proper application for grant of the consequential orders sought?

Counsel for the Applicants relied on Section 34 (1) and 98 of the Civil Procedure Act, Section 33 of the Judicature Act and the case of Sinba (K) Ltd & Ors Vs Uganda Broadcasting Corporation (supra) to submit that consequential orders is a way of enforcing satisfaction of a decree and that they flow naturally from the judgement. That there is a valid and binding consent judgment which was not enforced by the Respondents who resorted to using armed forces to prevent the Applicants from taking vacant possession. That the consequential order sought is to make the principal order of vacant possession or make compensation effective and effectual or incidental to the principal order in the consent judgement.

In opposition, Counsel for the 1st Respondent relied on the cases of 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 to argue that much as this court is clothed with 340 discretion to make orders, that there is no legal basis for the grant of the consequential orders by this court. That the Applicants are seeking to secure an unproven relief based on a breach, whose quantum is unproven. That this is not a proper application for grant of consequential orders in the alternative to contempt. 345

#### 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 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 Applicants a right to vacant possession of the suit properties, and a conditional relief of compensation for their respective plots of the suit properties in the event that vacant possession is not obtained. Save for the Respondents' contempt, there is no evidence to suggest that the implementation of terms of the consent judgment is impossible.

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The implementation can be achieved by ordering the Respondents to purge themselves of the contempt within a specified time. The applicants shall apply for the execution of the order of vacant possession, if vacant possession is not voluntarily given by the Respondents.

Therefore, I agree with Counsel for the 1st Respondent that a consequential order cannot suffice in this case. Accordingly, I find the issue in the negative.

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. In view of that, and the findings above, the application partially succeeds, but on the following terms; -

a. A declaration is made that the Respondents acted in contempt of court by failing to comply with orders of the consent judgement vide Civil Suit No. 930 of 2021.

b. The 1st Respondent, being a Government Agency, is ordered to pay to each 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, 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 $2023$ ).

c. An order that the Respondents purge themselves 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 Respondents.

Signed, dated and delivered at Kampala this. 3 day of MCW 2025.

Vabakooza Flavia Judge

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