Yahaya Ziraba Balyejjusa v Development Finance Co. of Uganda Ltd (CIVIL SUIT NO. 99 OF 1998) [1999] UGHC 39 (14 October 1999)

Full Case Text

### **the REPUBLIC OF UGANDA IN THE HIGH COURT OF UGANDA AT KAMPALA HIGH COURT CIVIL SUIT NO. 99 OF 1998**

#### **PLAINTIFF AL HAJI YAHAYA ZIRABA BALYEJJUSA**

## **VERSUS**

# **DEVELOPMENT FINANCE CO. OF UGANDA LTD::: DEFENDANT : BEFORE THE HON. JUSTICE RICHARD O. OKUMU WENGI.**

## JUDGMENT

The plaintiff brought this action as the registered proprietor of a prime Town Plot in Nakasero, Kampala for a declaration that the power of Attorney by which the property had been purportedly mortgaged to the defendant was not signed by himself. He also sought orders of this court to require the defendant to vacate the suit property and to pay general and aggravated damages, rent and mesne profits and costs of the action to the plaintiff.

The facts of the case are that the brother of the plaintiff one Tezikuba presented the plaintiffs Title Deed to the uptown property with a Power of Attorney allegedly executed by the plaintiff to secure an advance from the defendant to Tezikuba's company. The company defaulted and the defendant sought to enforce the mortgage and realise his advances whereupon the plaintiff showed up that he had never signed any or alleged Power ofAttorney and as such the mortgage was null and void.

Paragraph 4© ofthe Amended Plaint states

#### Particulars

- **(i)** The plaintiff'is referred to as Yahaya whereas his proper name is Yahya. j - (ii) The signature on the Power of Attorney was not authored by the plaintiff.

n 1 ' art the defendant denied liability and contended that the Suit was f 11 olous and vexatious as the person who mortgaged the property through a company was in control ofthe property and did so properly.

At the commencement of the trial it was agreed that the plaintiff was the registered owner of the suit property as per the Certificate of the title exhibited. Secondly it was agreed that the defendant was in possession of the original Certificate of Title the same having been deposited with the defendant by Affasat International (U) Ltd as security for a loan pursuant to Power of Attorney admitted by consent and exhibited as P.2. The loan agreement was also admitted as DI and the mortgage deed was admitted as Exhibit D.2:

Five issues were framed. However in view of the above agreed issues this court feels that there is just one main issue which is whether the Power of Attorney (which was admitted as Exhibit P2) was forged and or not authored by the plaintiff and as such the mortgage was invalidated. The plaintiff called three witnesses including himself, while the defendant called one witness. In his testimony the plaintiff testified that he learnt that his property was on sale by the mortgagee the defendant from a New Vision advertisement of January 1998. When he inquired from his brother Tezikuba the latter promised to bring the title deed to him in two days. He did not and the plaintiff instructed an advocate to contact DFCU demanding his Title Deed. He also lodged a caveat after Tezikuba admitted having mortgaged it. The Power of Attorney (Exhibit P2) was not his and the plaintiff further stated that he had not authorised Tezikuba to do the mortgage and did not know the witness in the Power of Attorney. The plaintiff brought out the transfer form (Exhibit P3) of 22nd January 1980 containing his signature. He also produced his identity Card and 1998 Graduated Tax Ticket bearing his genuine signatures. He denied the signatures on the Power of Attorney as well as the handwriting. In cross-examination the plaintiff admitted that his brother kept most of his land titles as he trusted his brother. He testified further in cross-examination that he was often out of the country and that as for his will his lawyers kept it. He further admitted that he gave his title for the suit house in 1982 and had since never looked at it or asked for it. He was however aware that the same title had been mortgaged to other banks including UCB. This was done by Tezikuba using his companies but on both occasions he was not a party.

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Mr. Ezati Samuel a documents analyst attached to the Scientific Aids Laboratory in the CID Headquarters testified that he had examined the questioned documents and came to the conclusion that they and signatures thereon were unlikely to have been made by the plaintiff.

Mr. Willy Ogule who testified for the defence side stated that Tezikuba through powers of Attorney and using his company Affasat

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International Ltd had mortgaged the suit title to UCB where the witness first knew Tezikuba and registered a mortgage transaction. Later he did a similar transaction at DFCU. In each case a power of Attorney was used. In crossexamination the witness conceded that at no time did he before registering the mortgages check transfer instruments and the operative signature of the registered proprietor and the signature on the powers of Attorney.

Both counsel filed written submissions. The plaintiff's counsel though filed his belatedly on the 6th October 1999 and another one on the $12^{th}$ October 1999. In his submissions Mr. Kibeedi learned counsel for the plaintiff submitted that the power of Attorney was a mere forgery and that any default in submission of the same to the handwriting expert did not vitiate the experts findings. He further submitted that it was incumbent upon the Bank defendant to have ensured that he dealt with a genuine Attorney and not a forgery or imposter and cited Gibbs vrs Messer (1891 – 4) All ER 2047. He claimed orders for vacant possession and damages.

On his part learned counsel for the defendant attacked the manner and form of documents submitted for examination by the writing expert and that the plaintiff all along authorised the mortgaging of his property. He then attacked the pleadings and contended the defendant was a mortgagee whose title could only be impeached for fraud and cited Olinda de Souza Figneredo vrs Kasamali (1962) EA 756, Warmiha Saw Milling Co. Ltd vrs Waiome Timber and Re. an application by GNM Mallo (9164) ULR 194 to support this view. Learned counsel further cited Grindlays Bank vrs Uganda Bottlers CA No. 29 of 1995 and 16 of 1996 to support the view that a registered proprietor's title is unimpeachable. He cited the case of Ruth Zirimuzawo vrs Paul Mukasa & 3 others HCCS No. 897 of 1988 (unreported) and Assets Co. Ltd vrs Morn Roihi & others (1995) AC 1076 to the effect that only actual fraud could shake a registered title. He cited further Sarah Karim vrs Registrar of Titles (1992-1993) HCB 110 that errors short of fraud cannot impeach a registered right. On fraud learned counsel further cited Kazora vrs Rukuba (1994 – 1995) HCB 58 and Stephen Lubega vrs Barclays Bank CA No. 2 of 1992 and submitted that such fraud if alleged must be pleaded specifically. Counsel further submitted that there was no fraud in this case attributable to the defendant and further that no particulars of any fraud had been pleaded. He asked court to dismiss the suit with costs.

This court has examined the pleadings in this case and the evidence as a whole as well as the submissions for each side. This case rests entirely on the question if a brother entrusted with a title deed owns a company and the company pledges the title deed the mortgagee in such transaction has not got a legal mortgage and may not enforce the security. Put in another way if the

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power of Attorney is proved to be false would this render the transaction void.

This court is of the view that the act of fraud pleaded in the plaint must amount to fraud in order for this court to pronounce that the right of the mortgagee is not a legal right. What is found in the pleadings is an allegation of forgery and that the plaintiff did not sign the power of Attorney. In the particulars of this forgery it is said that the plaintiff's name has been misspelt. To this court this is weak. To plead that a mistake by a forger goes to prove a forgery is to say the least unacceptable. Firstly such pleadings tends to highlight an infallibility on the part of the genuine registered proprietor. But more seriously the pleading does not state the name of the forger or the person who perpetrated it nor is he made a party to the suit. This is where the alleged forgery falls short of a plea of fraud. The purported "particulars" (whether particulars of what?) is nothing but an argument that the forger misspelt the registered proprietors name and as such could not have been the registered proprietor. This is not a particular of fraud. The failure to plead particulars of fraud and the specific allegation that the defendant was responsible for it or the fraud was attributable to it or further that the defendant took advantage of a fraud undermines this case fundamentally.

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Besides as assertion that DFCU should have been more careful when dealing with Tezikuba or Affasad International for that matter there has been no evidence that the defendant or his servant was party to any fraud or that they took advantage of any fraud by the company or its director. Therefore as there has been no suggestion or evidence of fraud this court agrees with the defendant's counsel that this suit must fail.

In his second submissions learned counsel for the plaintiff argued on the authority of Tiffu Lukwago vrs Samwiri Mudde & another CA No. 13/96 to the effect that a defendant's acts or omissions to act with due negligence is sufficient to prove fraud on his part when fraud is not pleaded. He also argued that the defendant cannot rely on an illegality to frame his claim: "ex turpi causa non oritur actio." I cannot see the acts or omissions by the defendant that prove his own fraud in this case. Similarly any illegality alleged was not perpetrated or known to the defendant who has taken advantage of such illegality. Since the perpetrator of the purported illegality is known to have been Tezikuba why was he not brought before court. If the fraud was perpetrated by him why was he not joined as a co defendant. This perhaps explains the case to the point that the said Tezikuba has been treated almost like a co plaintiff without him being actually joined. There is no omission or act by the defendant in this case whatsoever which can be

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shown to be a fraud or illegality by him. Accordingly this court cannot uphold the plaintiff's case and is constrained to dismiss it with costs.

$250$

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RICHARD O. OKUMU WENGI Ag. JUDGE $12/10/1999$ .

$14/10/99$

Kalenge for defendant Yunus Nsubuga for plaintiff Rosemary Emeru Court Clerk

Court:- Judgment read in open court in the presence of the above persons.

RICHARD O. OKUMU WENGI Ag. JUDGE 14/10/1999.

#### THE REPUBLIC OF UGANDA

$2s$

#### IN THE HIGH COURT OF UGANDA AT KAMPALA

#### CIVIL SUIT NO. 99 OF 1998

#### **BETWEEN**

#### ALHAJI YAHYA ZIRABA BALYEJJUSA **APPELLANT**

**VERSUS**

#### DEVELOPMENT FINANCE CO. OF UGANDA LTD RESPONDENT

#### **DECREE**

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PERFIT IT

This suit coming this 14th day of October, 1999 before His Lordship RICHARD . O. OKUMU WENGI in the presence of YUSUF NSIBAMBI on brief for the plaintiff and in the presence of MUBIRU-KALENGE for the defendant, it is ordered and decreed that;

The plaintiff's case against the defendant be dismissed with costs.

GIVEN under my Hand and Seal of this Court this day $\mathbf{1.2000}$ of $\mathbf{f}$

REGISTRAR/DEPUTY REGISTRAR