Rushfah Trading Co. Ltd v Chongqing International Construction Corporation Ltd and Bi-Energy General Trading LLC (Misc. Application No. 210 of 2024) [2025] UGCommC 218 (15 July 2025)

# 5 THE REPUBLIC OF UGANDA IN THE HIGH COURT OF UGANDA AT KAMPALA (COMMERCIAL DIVISION) MISC. APPLICATION NO. 0210 OF 2024 ARISING FROM MISCELLANEOUS APPLICATION 1702 OF 2021 10 (ARISING FROM CIVIL SUIT NO. 635 OF 2019)

RUSHFAH TRADING CO. LTD…………………………. APPLICANT

#### VERSUS

# 1. CHONGQING INTERNATIONAL CONSTRUCTION CORPORATION LTD……….. RESPONDENTS (CICO)

2. BI-ENERGY GENERAL TRADING LLC

## BEFORE: HON. LADY JUSTICE SUSAN ODONGO

#### RULING

This Application was instituted by Chamber Summons under the provisions of 25 Order 22 rules 23 and 89 (1) of The Civil Procedure Rules, SI. 71-1 for orders that: Court issues an order against the 1 st respondent and her agents, servants, advisors, workmen or any person deriving authority or instructions from her, restraining them from executing the consent judgement in HCCS No. 635 of 2019 and HCMA No. 1702 of 2021 in any manner pending the determination of the Third-Party proceedings against the 2nd 30 respondent in Civil Suit 653 of 2019.

#### 5 Background

The 1 st respondent in this application sued Colas East Africa/defendant (not a party to this application) in HCCS 635 of 2019 for recovery of USD 694,731.57 (United States Dollars Six Hundred Ninety Four Thousand Seven Hundred Thirty One and Fifty Seven Cents) arising from breach of a contract for the 10 supply of Bitumen. The defendant applied for and obtained an Order to add the applicant herein as a Third- Party to Civil Suit No. 635 of 2019. On 18th October, 2019 the applicant herein filed her Written Statement of Defence and Counterclaim. In the counterclaim, the applicant sought to recover the sum of USD 100,000 (United States Dollars One Hundred Thousand) against the 15 defendant and special damages of USD 78,680 (United States Dollars Seventy-Eight Thousand Six Hundred Eighty) against the 1st respondent herein and the defendant.

Notably on 16th March 2021 the applicant was granted leave under Miscellaneous Application 012 of 2021 to take out third party notice against 2 nd 20 respondent (Bi Energy General Trading) on the basis that the applicant contracted the 2 nd respondent to supply Bitumen to the 1st Respondent and that the 2nd respondent as the supplier performed the most critical contractual obligations that are in issue under the suit and that the applicant is entitled to seek indemnity against the 2nd respondent as to all liability that may arise from 25 allegations of adulterated bitumen and delivery of non-conforming documents.

Before the court could hear the matter on its merits, the parties on 7th July, 2021 negotiated and entered a Consent Judgment. Accordingly the parties agreed as follows: that the defendant shall upon execution transfer USD 233,000 to the plaintiff's bank account; the third party (applicant) shall within a period of 3

- 5 months from the execution pay USD 67,000 to the plaintiff as a top up to raise the USD 300,000; the defendant shall upon execution transfer USD 100,000 to the third party (applicant) as full and final settlement of the counterclaim between the plaintiff, the defendant and the third party; the plaintiff shall upon execution handover the Bitumen to the Third Party as is; in the event of default 10 of any of the term of this consent any offended party is at liberty to commence execution; the execution of the consent gives full and final resolution to all claims and disputes between the Parties and shall not be taken as acceptance of liability by any of the parties. - The applicant filed HCMA No. 1702 of 2021 to set aside the Consent Judgement 15 on grounds of mistake of facts, misrepresentation of facts, sufficient cause and an alternative prayer for discharge. Court dismissed HCMA No. 1702 of 2021. Prior to the hearing of HCMA No. 1702 of 2021, the applicant filed HCMA No. 1721 of 2021 seeking an interim order for stay of execution which court granted. On 8th November, 2023 the 1st respondent's lawyers Messrs. Milton Advocates, - acting for the 1st 20 respondent, wrote to Messrs. Kirunda & Co Advocates, the applicant's counsel, demanding the sum of USD 67,000 (United States Dollars sixty- seven thousand) and threatening to commence legal proceedings if the applicant fails to pay. Messrs. Kirunda & Co Advocates wrote back to Messrs. Milton Advocates stating that the Applicant has Third-Party proceedings against - the 2nd 25 respondent herein and that those proceedings will conclusively determine the applicant's liability for the sum of USD 67,000 arising from the Consent Judgement.

Consequently, the 1st respondent has threatened to continue with the execution proceedings she commenced under EMA No. 485 of 2021. The respondents 30 herein state that the Consent Judgment signed by the parties settled all disputes

5 between the parties, the Third-Party proceedings inclusive. The applicant hence filed this application for stay of the execution.

# Application and Affidavit in support

The provisions of the law under which this application has been instituted has been stated in the preamble to this ruling.

- 10 This application was support by the affidavit of Christopher Kibuuka Mugote, the Country Representative of the applicant company. He contends that the 1 st respondent in this application sued Colas East Africa/defendant in HCCS 635 of 2019 for recovery of USD 694,731.57 (United States Dollars Six Hundred Ninety Four Thousand Seven Hundred Thirty One and Fifty Seven Cents) - 15 arising from breach of a contract for the supply of Bitumen. The defendant applied for and obtained an Order to add the applicant herein as a Third- Party to Civil Suit No. 635 of 2019. On 18th October, 2019 the applicant herein filed her Written Statement of Defence and Counterclaim. In the counterclaim, the applicant sought to recover the sum of USD 100,000 (United States Dollars One - 20 Hundred Thousand) against the defendant and special damages of USD 78,680 (United States Dollars Seventy-Eight Thousand Six Hundred Eighty) against the 1 st respondent herein and the defendant.

Notably on 7 th January 2021 the applicant filed an application Miscellaneous Application 012 of 2021 for leave to take out third party notice against Bi Energy

General Trading (2nd respondent). On 16 25 th March 2021 the court granted the order to serve a third party notice and all pleadings arising out of Civil Suit No. 653 of 2019 on the 2nd respondent. The grounds for this application were that the applicant contracted the 2 nd respondent to supply Bitumen to the 1st Respondent and that 2 nd respondent as the supplier performed the most critical 5 contractual obligations that are in issue under the suit and that the applicant is entitled to seek indemnity against 2 nd respondent as to all liability that may arise from allegations of adulterated bitumen and delivery of non-conforming documents.

Before the court could hear the matter on its merits, the parties on 7th July, 2021 10 negotiated and entered a Consent Judgment (Annexture "F").

The applicant filed HCMA No. 1702 of 2021 to set aside the Consent Judgement on grounds of mistake of facts, misrepresentation of facts, sufficient cause and an alternative prayer for discharge. Court dismissed HCMA No. 1702 of 2021. Prior to the hearing of HCMA No. 1702 of 2021, the applicant filed HCMA No.

15 1721 of 2021 seeking an interim order for stay of execution which court granted.

On 8th November, 2023 the 1st respondent's lawyers Messrs. Milton Advocates, acting for the 1st respondent, wrote to Messrs. Kirunda & Co Advocates, the applicant's counsel, demanding the sum of USD 67,000 (United States Dollars sixty- seven thousand) and threatening to commence legal proceedings if the 20 applicant fails to pay. Messrs. Kirunda & Co Advocates wrote back to Messrs. Milton Advocates' stating that the Applicant has Third-Party proceedings against the 2nd respondent herein and that those proceedings will conclusively determine the applicant's liability for the sum of USD 67,000 arising from the Consent Judgement.

25 That following the dismissal of HCMA No. 1702 of 2021, Court withdrew all relief and protection it had accorded to the applicant. Consequently, the 1st respondent has threatened to continue with the execution proceedings she commenced under EMA No. 485 of 2021. That the applicant stands to suffer substantial and irreparable loss and further that execution will render the third5 party proceedings nugatory and deprive the applicant of its ability to recover its impleaded sums from the 2nd respondent.

# Affidavit in Reply

In response, the 1 st Respondent filed an affidavit deponed by Douglas Wu Xiao Xiong, a procurement manager of the 1st respondent company. He avers that indeed court allowed the applicant to serve a third party notice on the 2 nd 10 respondent in respect to liabilities arising under Civil Suit No. 635 of 2019. That the 2nd respondent did not file pleadings before objecting to liability under the Third Party Notice. He further avers that the parties entered a settlement in respect to the civil suit and this was concluded by a consent judgement. The 1 st 15 respondent stated that the Consent Judgment signed by the parties settled all disputes between the parties, the Third-Party proceedings inclusive. That subsequent application to set aside the consent judgment was dismissed by the court. That therefore there is no suit pending before this honourable court in respect to which the alleged third party proceedings are being undertaken since 20 civil suit No. 635 of 2019 was disposed of by way of consent Judgement/ decree that the Applicant unsuccessfully attempted to set aside in MA 1702 of 2021. That the applicant has brought this application to stall the applicant's obligation to pay the 1st Respondent having failed to successfully set aside the Consent Judgement.

## 25 Supplementary affidavit

In their supplementary affidavit sworn by Christopher Kibuuka Mugote, the applicants stated that the 1st Respondent was in breach of the consent having conveyed, converted or otherwise appropriated for its beneficial use, and 5 without the knowledge or consent of the applicant, the same Bitumen it had rejected.

#### Hearing and Representation

When the matter came up for hearing, the applicant was represented by M/s Kirunda & Co. Advocates and the 1st respondent by M/s Milton Advocates. The 10 parties addressed the court by written submissions which the court has considered in determining the dispute.

#### Issues for Determination

The singular issue for determination is whether the application for stay of execution in Civil Suit No. 635 of 2019 pending the determination of the Third-

Party proceedings against the 2nd 15 respondent in Civil Suit 653 of 2019 be granted.

## Determination by the Court

*Whether the application for stay of execution of judgement and decree in Civil Suit No. 635 of 2019 pending the determination of the Third-Party proceedings against the 2nd* 20 *respondent in Civil Suit 653 of 2019 should be granted?*

This application has been commenced under Order 22 rule 23(1) of *The Civil Procedure Rules,* which empowers the court to which a decree has been sent for execution to, upon sufficient cause being shown, stay the execution of the decree for a reasonable time to enable the judgment debtor to apply to the court by 25 which the decree was passed, or to any court having appellate jurisdiction in respect of the decree or the execution of the decree, for an order to stay the execution, or for any other order relating to the decree or execution which might have been made by the court of first instance.

 - 5 A perusal of this rule would reveal the following core features: - 1) the court is empowered to stay execution of a decree sent for execution; - 2) the stay is for a short period of time; - 3) the judgement debtor must show sufficient cause for the court to grant the stay; - 10 4) the purpose of the stay of execution is to allow time for the judgement debtor to apply for stay or other order to the original or proper court; - 5) the application can be made to the court which passed the decree or any court with jurisdiction; the grant of the stay is discretionary; - 6) The application may be granted subject to conditions such as depositing 15 in court security for due performance of the decree.

The principal characteristic of this provision lies in the responsibility of the judgement debtor in demonstrating to the court that he/she has sufficient cause which warrants the grant of the stay of execution. This responsibility requires 20 the judgement debtor to present clear, credible, and legally valid reasons, such

- as, procedural errors, new evidence, or extenuating circumstances that justify a delay in execution. The burden of proof lies squarely on the judgement debtor, meaning they must provide compelling evidence or arguments to persuade the court that there is a legitimate basis for relief. Failure to establish sufficient cause - 25 typically results in the enforcement of the judgment as originally ordered.

The Black's Law Dictionary 8th Edition at page 663 defines sufficient cause to show why a request should be granted or an action excused. The Judgement debtor seeking a stay of execution must satisfy the court that there is sufficient 30 cause why the judgment creditor should postpone the enjoyment of his/her

benefits. It is not sufficient for the judgment debtor to say that he is vulnerable,

- 5 because the successful party may take out execution proceedings. It must be shown that if execution proceeds there may be some irreparable loss caused. *(See: Wilson Mukiibi V James Ssemusambwa, Civil Application No. 009 of 2003 (SC), Registered Trustees of The Hindu Union V Kagoro Epimac and 2 Ors, Miscellaneous Application No. 304 of 2017 (CA).* - 10 It is important to highlight that what constitutes "sufficient cause" is not a fixed standard: it is always dependent on the unique facts and circumstances of each case, and the court's discretion plays a crucial role in determining its adequacy. In all instances, the court must be mindful to exercise such power without undue prejudice to the other party. The court should, inter alia, ensure that the - 15 application is not an abuse of court process intended to circumvent liability or delay the judgement debtor from the benefit of relief or re litigation of issues that have already been conclusively resolved. Sufficient cause should be viewed from a balanced lense of justice and fairness. - 20 In regard to the application before this court, the sufficient cause advanced by the applicant is that there is pending Third-Party proceedings against the 2nd respondent which will conclusively determine the applicant's liability arising from the Consent Judgement. I observe from the evidence and submissions before this court, that it is not the first time the applicant has taken legal 25 measures to prevent the execution of the consent judgement in Civil Suit No. 635 of 2019, the first being by High Court Miscellaneous Application No. 1702 of 2021 to set aside the Consent Judgement on grounds of mistake of facts, misrepresentation of facts, sufficient cause and an alternative prayer for discharge. This was not successful. The second being this application by which 30 the applicant seeks to stay the execution of the consent judgement on the ground that there is pending Third-Party proceedings against the 2nd respondent which

- 5 will conclusively determine the applicant's liability for the sum of USD 67,000 arising from the Consent Judgement. The applicant in paragraph 15.1 of her Affidavit in Support alleges that execution will render the Third-Party proceedings nugatory and deprive the applicant of its ability to recover its impleaded sums from the 2nd Respondent. - 10 It is trite that where the same parties litigate a second suit on the same claim, or any other claim arising from the same transaction or series of transactions and that could have been but was not raised in the first suit they are precluded by the doctrine of res judicata, an affirmative defense, from litigating the second suit (see: *Section 7 of the Civil Procedure Act Cap.282)*. *Res Judicata* could be as much 15 applicable to different stages of the same suit as to findings on issues in different suits. Where the doctrine is invoked in the case of the different stages of proceedings in the same suit the nature of the proceedings, the scope of the enquiry which the adjectival law provides for, the decision being reached as well as the specific provision made on matters touching such decisions are some of - 20 the factors to be considered before the principle is held to be applicable. (see: *Re. Arjun Singh v. Mohindra Kumar and Ors., AIR (1964) SC 993; Satyadhyan Ghosal v. Sm. Deorajin Debi, [1960] 3 S. C. R. 590).*

The doctrine of *Res Judicata* at common law furnishes three categories of 25 preclusive plea: those pleas that prevent the contradiction of an earlier judgment by means of estoppel (issue estoppel and cause of action estoppel); those that preclude a party in later litigation from raising subject matter which the parties, by exercise of due diligence could and should have brought before the court in the earlier proceedings associated with abuse of process *(Henderson v Henderson*

5 *(1843) 3 HARE 100, 67 ER 313)*; and those which prevent reassertion of the same cause of action by means of merger or extinguishment of that cause of action in the judgement.

The principle on abuse of court process bears a close resemblance to the doctrine of res judicata. The difference being that abuse of court process addresses 10 situations where the legal process is manipulated for improper purposes such as filing multiple suits on the same subject matter in the same or different courts. The English Court in *Henderson v Henderson* (supra), in defining abuse of process, confirmed that a party may not raise any claim in subsequent litigation which they ought properly to have raised in a previous action. The Court held:

15 *"where a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter[s] which might have been brought forward as part of the subject in contest, but which* 20 *was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case."*

The policy behind res judicata and abuse of process is *"to bring finality to litigation and avoid the oppression of subjecting a defendant unnecessarily to successive actions"; "there should be finality in litigation and a party should not be twice vexed in the same*

25 *matter". (Johnson v Gore Wood, [2000] UKHL 6 at pp. 31 & pp. 58-59).*

This not only upholds the integrity of the judicial process but also protects the defendants from perpetual legal exposure. A defendant should not be left in a perpetual state of anxiety, constantly fearing that another suit will be filed on the same matter and he will have to expend resources defending the matter.

5 The Supreme Court of Uganda and Court of Appeal on abuse of legal process decided that this occurs when the party employs it for some unlawful object, not the purpose which it is intended by the law to effect in other words a perversion of it. *(See: Attorney General & another V James Kamoga & another Civil Appeal No. 8 of 2004; Prof. Isaiah Omolo Ndiege V Kyambogo University Civil Appeal No. 142 of*

10 *2013.*

An action is an abuse of process only if the Court's processes are being misused to achieve something not properly available to the plaintiff in the course of properly conducted proceedings. The cases appear to suggest two distinct categories of such misuse of process: (i) the achievement of a collateral 15 advantage beyond the proper scope of the action, or (ii) the conduct of the proceedings themselves not so as to vindicate a right but rather in a manner designed to cause the defendant problems of expense, harassment, commercial prejudice or the like beyond those ordinarily encountered in the course of properly conducted litigation (see *Broxton v. McClelland and Another, [1995]*

20 *EMLR 485*). For that reason, commencing or continuing proceedings which a party has no intention to bring to a conclusion may constitute an abuse of process.

Notably the applicant secured orders for third party proceedings before the consent judgement was issued. Therefore, if the payment of USD 67,000 to the 1 st 25 respondent herein was contingent upon the outcome of the Third-Party proceedings with the 2nd respondent, this condition would have been made express in the Consent judgment. Later when the applicant filed High Court

Miscellaneous Application No. 1702 of 2021 to set aside the Consent Judgement, the 3rd respondent in this application was named as a third party in 30 that application. One of the grounds by the applicant was that he had added the

- 3 rd respondent as party to indemnify him against any liability to the 1st and 2nd 5 respondents. This application was dismissed. In essence the reason that there is pending third-party proceeding was not a strong basis for the grant of the application. - In my view, the issues and claims under this application were handled in the 10 Consent Judgement as such barred by res judicata. If at all they were not, then it was the responsibility of the applicant to include the third party proceedings against the 3rd respondent under the consent. In view of this the claim is caught by the principle in *Hendersen v Hendersen*. - It also appears to me that this application essentially replicates the content and 15 substance of High Court Miscellaneous Application No. 1702 of 2021 with the only distinction being its request for stay of execution of the consent judgement. Aside from this minor modification in the relief sought, the grounds, supporting facts, and arguments remain virtually unchanged. It would be a scandal to the administration of justice if, the same question having been disposed of by one 20 case, the litigant was permitted by changing the form of the proceedings to set up the same case again … there must be an inherent jurisdiction in every Court of Justice to prevent such an abuse. (Lord Halsbury in *Reichel v Magrath* (1889) 14 App Cas 665, at 668). It is an abuse and should not be permitted.

The applicant has not shown sufficient cause for grant of the application. I 25 therefore answer the issue in the negative.

Both parties in the instant application made prayers for costs. The Court has discretion to determine costs and against whom. (*Section 27 subsections (1), (2) & (3) of the Civil Procedure Act, Cap. 282)*

Consequently, this application is dismissed with costs to the 1 5 st Respondent. I so order.

Dated, signed and delivered electronically this 15 th day of July, 2025.


10 Susan Odongo

## JUDGE