Uganda Native Trading Company Limited v Muwemba (Civil Appeal No. 41 of 1955) [1950] EACA 62 (1 January 1950)

### H. M. COURT OF APPEAL FOR EASTERN AFRICA

### Before SIR NEWNHAM WORLEY (President), BRIGGS (Acting Vice-President) and BACON, Justice of Appeal

## THE UGANDA NATIVE TRADING COMPANY LIMITED, Appellant (Original Defendant No. 1)

# ν AGUSTE MUWEMBA, Respondent (Original Plaintiff)

### Civil Appeal No. 41 of 1955

#### (Appeal from the decision of H. M. High Court of Uganda, Ainley, J.)

Fraud—Agreement for sale of land—Forgery—Onus of proof.

The respondent, as representative of the estate of his father Y. M. sued the appellant company and one S. (the original defendant No. 2) in conspiracy claiming delivery up to him for cancellation a document purporting to be an agreement by his father to sell certain land to J. M. as agent for the company, on the ground that the document was a forgery in that whilst it purported to bear the signature of his father, the latter had always been wholly illiterate. The document was signed by J. M. for the company and was witnessed by B. and by S. the original defendant No. 2. B. had never previously met the man who had signed as J. M. and S. had disappeared on being served with the plaint. The Company had presented the document (and others) to the Registrar of Titles and imposed a caveat to protect its contractual rights but no formal transfer had ever been executed. The respondent had throughout merely claimed a declaration that the agreement was void. There was no prima facie evidence by the company of the execution of the document by Y. M. The trial Judge held that it was "established as a matter of probability" that the document was not genuine and he ordered its delivery up. It was contended on appeal that as a mere balance of probability cannot lead to a finding of fraud the trial Judge's finding was insufficient to support a judgment for the plaintiff.

**Held** (21-1-56).—(1) Whilst fraud must be "pleaded with particularity and proved with precision" and a mere balance of probability cannot lead to a finding of fraud, these propositions were inapplicable to the instant cas sceking to clear his title by removing the caveat, and the caveat could only be justified if the company had a valid agreement of sale. The onus of proving the effectiveness and<br>validity of a document being upon the party relying on it, the company not having given even prima facie evidence of the execution of the document by Y. M. had failed to discharge the burden of proof on it. The trial Judge was entitled to find for the respondent on a balance of probability, it being unnecessary to prove the non-execution of the document by Y. M. with the strictness ordinarily required in cases of fraud.

(2) Semble-Had the document been a transfer embodied in the Register of Titles so that the company had become the proprietor of the land it would have been necessary to prove the forgery to conclusion to obtain rectification.

Appeal dismissed.

No cases.

### Hunt for appellant.

#### Keeble for respondent.

BRIGGS, Acting Vice-President.—This is an appeal from a decree of the High Court of Uganda ordering that the appellant company do deliver up to the respondent for cancellation a certain document. The circumstances are somewhat unusual and raise a point of law of some novelty.

The document in question purports to be an agreement executed by the respondent's father, Yowana Mukadaiga, whereby on 11th April, 1942, he agreed to sell an area of *mailo* land some 449 acres in extent to one Juma Mukasa, as agent for and on behalf of the appellant company, for the sum of Sh. 435 then paid and acknowledged. The document bears a signature "Yowana Mukadaiga". which was witnessed by one Kostante Sajjabi, who was the second defendant in the Court below. It is also signed by Mukasa for the company and by his witness, one Busulwa.

The respondent sued the company and Saijabi in conspiracy on the ground that the document was a forgery by means of which the company had fraudulently obtained registration as proprietor of the land. He claimed as representing his deceased father's estate, and based his allegation of forgery on his own evidence that his father had always been wholly illiterate. This was to some extent corroborated by an admittedly genuine document dated 1932 whereby the father acknowledged receipt of a duplicate Certificate of Title then issued to him. This receipt was thumb-printed, not signed. The probabilities are very strong that, if Mukadaiga could have signed his name, he would then have done so, and again that, as he was already elderly, if not old, in 1932, he would not have learned to sign his name thereafter. The illiteracy might perhaps have been established more clearly if a number of the father's old acquaintances had been called, but this was not done. One may say, however, that there was some good prima facie evidence of illiteracy, and, therefore, of the fact that the document in issue was a forgery.

The evidence for the appellant company was both scanty and inconclusive. Mukasa said that he had never known Mukadaiga before the day on which the agreement was executed; that a man representing himself to be Mukadaiga had come to see him and had produced the duplicate certificate of title; that Sajjabi, whom Mukasa knew slightly, was with him; that the sale was negotiated and agreed upon, the document drawn up and executed, the title deed handed over, and the purchase price paid; and that he duly handed the agreement and title deed to the company. The company then presented the documents to the Registrar of Titles and imposed a caveat to protect its contractual rights. No formal transfer has ever been executed, and the company was never, as the respondent thought, registered as proprietor. The company merely bought as a speculation. intending to resell in due course. It sought and obtained the Lukiko's approval of transfer to itself, but was satisfied to leave matters in that condition.

Sajjabi was served with the plaint. He thereupon disappeared and it has not been possible to trace him since. Apart from the production of the duplicate certificate of title, to which I shall revert, these facts seem to suggest a dishonest impersonation of Mukadaiga by some person unknown, aided and abetted by Sajjabi. At least it may be said that there is really no evidence at all that it was Mukadaiga who signed, rather than that other person. On the evidence it may have been either.

As regards the certificate of title, one would expect it to be in Mukadaiga's hands, unless for some good reason; but the respondent's evidence was that one Benywa Bamutula, now deceased, had contracted to purchase 160 acres of Mukadaiga's land. Sajjabi was the son of Bamutula and succeeded to his property on his death. The respondent's evidence was that the title deed had been handed to Sajjabi at his request to enable him to arrange for subdivision and transfer of these 160 acres. There is nothing inherently improbable in this evidence. It is perhaps more likely that Mukadaiga would sell a part of his land than that he would sell the whole, and it shows clearly how Sajjabi and his. unknown accomplice may have got possession of the title deed.

On examining this evidence, and other relevant considerations with which I need not deal, the learned trial Judge arrived at the conclusion that it had been "established as a matter of probability that the questioned document was not genuine", a conclusion with which, if I may say so, I think it would be difficult to disagree. The appeal, however, is based on the contention that this finding is insufficient to support a judgment for the plaintiff in a case based on fraud.<br>The appellant says that fraud must be "pleaded with particularity and proved with precision" and that a mere balance of probability cannot lead to a finding of fraud. As a general proposition this is of course correct. The question is whether it governs this case.

It must first be observed that, though the Court found that fraud had been committed there is no finding that the appellant company or Mukasa were parties to that fraud, and it must be assumed for all purposes that they were innocent victims of it. The question then was merely which of two equally innocent parties should suffer. I am disposed to think that if the document had been a transfer instead of an agreement of sale and if the appellant had registered it and so become proprietor of the land, it would have been necessary to prove the forgery to conclusion in order to obtain rectification: but that<br>is not the position. The respondent is the proprietor and seeks to clear his title by removing the caveat, which can be justified only if the appellant has a valid agreement of sale. The onus in such a case should in principle be on the person relying on the agreement to prove its effectiveness and validity. Here the appellant failed to give even prima facie evidence that the disputed document was executed by Mukadaiga. There is no presumption of genuineness. It is easy to see that, if differently pleaded, the suit could have been successful without any allegation of fraud against the appellant and without joining Sajjabi as a defendant. It is not so apparent that the pleadings as they stand can justify the decision.

The original plaint was filed in summary form, but was accompanied by a "statement" which sets out the facts and claims removal of the caveat and annulment of the questioned document. It alleges conspiracy and fraud against both defendants, which were never proved. An amended plaint was later filed asking for a declaration that the respondent was entitled to be registered as proprietor of the land and for rectification of the register. This sprang from the erroneous belief that the ownership had been formally transferred. At the outset of the trial Mr. Keeble for the respondent said: "All we claim is a declaration that the agreement is void", and the suit proceeded on that basis. I think in the circumstances the learned trial Judge was right in thinking that he was entitled to find for the respondent on a balance of probability and that it was unnecessary to prove non-execution by Mukadaiga with the strictness ordinarily required in cases of alleged fraud. I would dismiss the appeal with costs.

WORLEY, President.—I agree and have nothing to add. The appeal is dismissed with costs.

BACON, $J. A.-I$ agree and have nothing to add.