Twagira v Uganda (Criminal Appeal 160 of 2002) [2003] UGCA 11 (19 August 2003)

## **THE REPPUBLIC OF UGANDA**

## **IN THE COURT OF APPEAL OF UGANDA AT KAMPALA**

## **CORAM: HON. JUSTICE L. E. M. MUKASA-KIKONYOGO, DCJ HON. JUSTICE A. E. N. MPAGI-BAHIGEINE, JA HON. JUSTICE C. N. B. KITUMBA, JA**

## **CRIMINAL APPEAL NO. 160 OF 2002**

## **CHARLES HARRY TWAGIRA ::::::::::::::::::::::::::::::::::::::::::: APPELLANT**

### **VERSUS**

### **UGANDA :::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: RESPONDENT**

#### **[Appeal from the ruling order of the High Court (Bamwine J.) dated 16.2.2002 in Criminal Revision Application No. 4 of 200]**

### **JUDGMENT OF THE COURT:**

This is an appeal from the ruling/order in Criminal Revision Application No. 4 of 2002 of the High Court (Bamwine J.) refusing to review an order by the Chief Magistrate, Buganda Road Court (Othembi C. M.) that the appellant had a case to answer, under Section 126 of the Magistrate's Court Act 1970, in Buganda Road Criminal Case No. 1423 of 2002.

The following is the background to this matter. The appellant, Charles Twagira is the majority shareholder (60%) of a company called Oil Seeds Uganda Ltd. He is also the Managing Director and sole signatory to the company accounts.

The company was the recipient of an arbitral award of Shs. 700 million against Uganda Development Bank which also paid Shs. 70 million for its arbitral costs, the arbitration having been conducted by Mr. Remmy Kasule.

The appellant banked all the said moneys on the company account and being the sole signatory he proceeded to issue cheques to settle various company debts including some to himself.

The respondents who are the minority shareholders 920% each) were not satisfied with the state of affairs and complained to the Police which applied for extradition orders against the appellant, while he was abroad. He was arrested at Heathrow Airport, returned and charged on two counts of embezzlement and theft by agent of the funds in question.

The particulars of the count on embezzlement contrary to Section 257(b) of the Penal Code Act were that:

**"the appellant, Charles Twagira and others still at large. . . at Uganda Commercial Bank Ltd., . . . being a Managing Director of Oil Seeds (U) Ltd., stole cash Shs. 700,000,000 (seven hundred million shillings) being the proceeds of Cheque No. 274474 paid to the said Oil Seeds (U) Ltd."**

Those of the count on theft by agent contrary to Section 252 and 260 (c) of the Penal Code Act were that:

**"Charles Twagira and others still at large, at Diamond Trust Building in Kampala District, stole cash Shs. 70,000,000 (Seventy million shillings) which was received by the said Charles Twagira from Bitangaro Sam, on account of Remmy Kasule."**

At the trial a total of 10 witnesses testified for the prosecution, tendering in several exhibits, after which the trial Chief Magistrate ruled that there was a case

to answer by the appellant, under Section 126 of the Magistrates' Courts' Act 1970.

The appellant being dissatisfied petitioned the High Court vide Criminal Application No. 4 of 2002, aforesaid, on the ground that the learned Chief Magistrate had misdirected himself on a number of issues when he held that there was a prima facie case made out against the appellant.

The High Court (Bamwine J) dismissing the petition held:

**"What the petitioner is inviting me to revise in the instant case is a 'ruling' made by the trial Court that the accused has a case to answer.**

**This cannot be in view of the authorities I have cited above. I do reiterate that what can be revised is a final order when the proceedings in the lower court are concluded and the accused's fate is determined one way or the other. That state is yet to be reached in Criminal Case No. 1423 of 2000."**

He then went on to say:

**". . . upon perusal of the proceedings and ruling of the lower court and after listening to the arguments of all counsel in this case, I have come to the conclusion that there is nothing irregular about the procedure adopted by the trial Magistrate so far or anything prejudicial to the petitioner or on the face of the record to warrant a revisional order at this stage.**

**I therefore find no merit in this petition and I dismiss it."**

The appellant appealed against this dismissal to this court (Criminal Appeal No. 160 of 2003). In its ruling dated 8.05.2003, on an objection to the competence of the appeal, raised by the DPP, the court disagreed with the learned Judge's decision and said:

**"We do not agree with Mr. Byabakama-Mugenyi that the order complained of must be final before the High Court can revise it. Those sections give the High Court wide reversionary powers to correct wrongs occasioned either by interlocutory or final order made by Magistrates. We think in this case that the appellant correctly petitioned the High Court under Section 341 (5) to exercise its powers of revision. The appeal being from the appellate decision of the High Court is properly before us. . ."**

Hence this appeal before us. It is based on eight grounds:

- **"1. The learned Judge erred in law when he held that "what can be revised is a final order when proceedings in the lower court are concluded;"** - **2. The learned Judge erred in law when he failed to satisfy himself as to the correctness, legality or propriety of the finding "that there was a case to answer;"** - **3. The learned Judge erred in law when he failed to find that the Trial Magistrate's finding that there was a case to answer was without evidence;**

- **4. The learned Judge erred in law and misdirected himself on the duties of a court exercising revisional jurisdiction;** - **5. The learned Judge erred in law in failing to find that Remmy Kaasule's debt could not have been stolen;** - **6. The learned Judge erred in law in failing to find that the accused's un rebutted plea of claim of right was sufficient to warrant his acquittal on count 1 of embezzlement;** - **7. The learned Judge erred in law when he failed to acquit the appellant and so occasioned a miscarriage or justice;**

## **8. The learned Judge erred in law when he purported to dismiss the revision application."**

Mr. Phillip Karugaba, learned counsel for the appellant argued ground 1 alone; grounds 2, 4 and 8 together and 3, 5, 6 and 7 also together.

As regards ground 1, that the learned Judge erred when he held that "what can be revised is a final order when proceedings in the lower court are concluded," we think this was disposed of by the ruling of this court when it stated:

# **"We do not agree with Mr. Byabakama-Mugenyi that the order complained of must be final before the High Court can revise it. . ."**

Mr. Karugaba however dwelt at length on the duties of the first appellate court citing numerous cases and submitting that a High Court sitting in revision has the same duties as a court sitting on first appeal whose duties ate to subject the evidence to a fresh and exhaustive scrutiny. This learned Judge failed to do, he said. Had he done so he would have acquitted the appellant.

The gist of all his arguments summed up together was to the effect that since the appellant was the owner of the company and the driving force behind the securing of the money in question and therefore he could not steal what was his own. He pointed out that the appellant owned 60% of the shares of the company he had helped to form and that it was his sole occupation all his life. Mr. Karugaba submitted that the appellant has a claim of right of the company and the charges against were unsustainable. The learned Judge and the Chief Magistrate failed to scrutinize the evidence. Had they done so they would have found that the appellant could not steal from himself. Citing **Pandya v R (1957) EA 336; Ruwala v R (1957) EA 570 and Murimi v Rep (1967) 542,** amongst others, Mr Karugaba further submitted that the essential ingredients of the offences charges were not proved and that therefore, the appellant was entitled to an acquittal as the prosecution had failed to establish a prima facie case against him. It was a grave error in law to put the appellant to his defence in absence of a prima facie case being established against him. He prayed court to subject the evidence to a fresh scrutiny as the first appellate court, make its own findings and acquit the appellant.

Mr. Simon Byabakama, Deputy DPP, pointed out and rightly so, that the question was whether the appellant was correctly put to his defence on both counts. He submitted that the prosecution evidence indicated that the appellant was an officer of Oil Seeds (U) Ltd. as its Managing Director, that he did receive the Cheque of Shs. 700 million payable to Oil Seeds (U) Ltd. and therefore the property of that company. This was not in dispute. Being the Managing Director he thus received the said Cheque for and on behalf of his employer. He banked the Cheque in the name of the company where he was sole signatory. He signed several cheques drawn on that account. Some of these cheques have

been traced to other Bank accounts in his personal names. One of such cheques, according to PW8, was traced at the Bank of Uganda where the appellant applied it to purchase treasury Bills in his personal names; another payment was traced to a US dollar account in Barclays Bank in the appellant's personal names. There was thus sufficient evidence to sustain both counsel. Mr. Byabakama asserted that the appellant's claim of right as an answer to the charges was unsustainable as the other two minority shareholders Steven Katenda and Charles Twagira were also entitled to protect their shares and were correct to complain to the police. The money was company property. The money which came into the appellant's hands included Shs. 70 million as legal fees for Mr. Kasule, which he has never received. He submitted that learned Chief Magistrate properly directed his mind to all the facts and the evidence before him when he held that an explanation was called for from the defence in accordance with the test in **Bhatt v R. (1957) 332 at 335**.

In rejoinder Mr. Karugaba submitted that there was no complainant in the case. The shareholders could not be the complainants. In his view this was a civil case which did not justify a criminal prosecution. He reiterated that the appellant was owed money and the company Oil Seeds was the appellant's sole occupation over the years and therefore he could not steal what was his own.

The learned Chief Magistrate held:

**"There is evidence that the cheque was banked on the company account. The accused made withdrawals and engaged in several transactions relating to the account and the proceeds of the Cheque. . ."**

He further observed:

**"There is evidence to show that some of these dealings raise doubts as to whether the money was applied to the affairs of the company or stolen by the accused. It is necessary for the accused to give an explanation to court regarding those dealings. There is therefore evidence establishing the essential ingredients of the offence of embezzlement contrary to Section 257(b) Penal Code Act requiring the accused to make a defence."**

Turning to the issue of the appellant's claim of right over the company property, it is trite that company property belongs to the company and not to individual shareholders. In this regard we would do no better than refer to **Attorney General's Reference (No. 2 of 1982) (1984) Q. B. 624, 78 Cr. App. R. 131**, where the Court of Appeal held that a person in total control of a limited liability company by reason of his shareholding and directorship or two or more such persons acting in concert were the sole owners of the company and through their shareholding the sole owners of all its property, they could not in effect be charged with stealing from themselves. That the respondents were the sole will and directing mind of the company and that the company was therefore, bound to consent to all to which they themselves consented to was rejected. On the basis of this authority the appellant's claim of right is unsustainable. Also see **Belmout Finance Corporation Ltd v. Williams Furniture Ltd. (1979) Ch. 250, C. A (Civ Division)**.

The basic definition of theft is appropriation of property "belonging to another." These words signify that the time of appropriation or obtaining the property belonged to another. There was sufficient evidence that the money appropriated by the appellant belonged to the company which was the appellant's employer and some of which was intended for Mr. Kasule, whether or not it had passed to Mr. Kasule is irrelevant.

The essential ingredients of both counts theft by agent and embezzlement were clearly extant.

Turning to the issue of what is a prima facie case, this court held in **Semambo Charles and Fred Musisi Ssemakula v Uganda, Criminal Appeal No. 67/98** (unreported) thus:

**"A prima facie case means a case sufficient to call for an answer from the accused person. At that stage prosecution evidence may be sufficient to establish a fact or facts in absence of evidence to the contrary but not conclusive. All the court has to decide at the close of the prosecution is whether a case has been made out against the accused just sufficiently to require him or her to make his or her defence. It may be a strong case or it may be a weak one. At that stage of the proceedings the court is not required to decide whether the evidence if believe is guilty of the offence charged."**

We need to emphasise that a prima facie case does not mean a case proved beyond reasonable doubt as Mr. Karugaba's submissions seemed to suggest. In **Wabiro alias Musa v R (1960) EA 184**, it was held inter alia that (ii) a prima facie case does not mean a case proved beyond reasonable doubt. . ., (iii) the reasons which lead a judge/magistrate to a decision on a submission of "no case to answer" would not in law be the same as would activate him when deciding at the close of proceedings whether to convict. At this state the case does not have to be proved conclusively. The final determination can only be made after the case for the defence has been heard, when an assessment of the evidence as whole is made. This seems to have been overlooked by Mr. Karugaba.

We would also point out that though the appellant bears no burden in a criminal case, however, many cases like the instant one, an explanation from the accused appellant may well as a matter of commonsense be required and an absence of explanation would invariably read to an inference of guilt.

We entertain no doubt in this case, there was a prima facie case against the appellant ad some explanations as a matter of commonsense were required as observed by the Chief Magistrate.

A perusal of the record indicates a clear prima facie case with no error or irregularity having been apparent on record.

In our view this appeal lacks merit and is dismissed forthwith.

Date at Kampala this……….19th…….day of……August,…….2003.

## **L. E. M. MUKASA-KIKONYOGO, DEPUTY CHIEF JUSTICE**

## **A. E. N. MPAGI-BAHIGEINE JUSTICE OF APPEAL**

**C. N. B. KITUMBA JUSTICE OF APPEAL**