THE REPUBLIC OF UGANDA

IN THE HIGH COURT OF UGANDA AT KAMPALA

                             MISCELLANEOUS APPLICATION 007 OF 2014

IN THE MATTER OF A VESTING ORDER OF A TELECOM MAST AND EQUIPMENT ERECTED ON KYADONDO BLOCK 221 PLOT 2172 AT NALYA

DANIELNKALUBO SEBUGWAWO::::::::::::::::::::::::::::::::::::::::::APPLICANT

BEFORE THE HON. JUSTICE HENRY PETER ADONYO

RULING

This application was brought under Order 52 rules 1 and 3 of the Civil Procedure Rules (CPR), and Section 98 of the Civil Procedure Act (CPA) for orders that:

1. The  equipment and telecom mast erected on Kyadondo Block 221 Plot 2172 at Nalya vide a lease deed dated 15^th July 2009 be vested in the landlord/ lessor; Daniel Nkalubo Ssebugwawo.
2. Costs of the Application to be borne by the Applicant.

The grounds of this application are contained in the notice of motion and the affidavit in support to the application deposed by Daniel Nkalubo Ssebugwawo, the Applicant and registered proprietor of the land comprised in Kyadondo, Block 221 Plot 2172, herein after referred to as “the land”.

The gist of those grounds is that Mr Nkalubo leased part of his land measuring 12 meters by 15 meters to Telecom Management Partner, Uganda (herein after referred to as “TMP”) on 15^th July, 2009. The lease was to run for a period of ten years and TMP erected a mast on the land. TMP wound up and did not fulfill its obligations under the said lease, at which point the Applicant repossessed the land. It is stated that there were attempts made to contact TMP’s liquidators proved futile hence the application seeking an order to vest the mast erected on his property in him as the lessor.

The Application is however opposed by a one Mr Perry Muhebwe, the duly appointed liquidator of TMP, who in an affidavit in reply deponed by the Respondent, states that it was true that the Applicant had leased the land to TMP for erection of telecommunication equipment. That the Applicant did serve the notice requiring removal of the equipment on 1^st August, 2012 to Muhebwe & Owor Advocates but the liquidator did not personally receive it as it was addressed to the law firm and not to him as the liquidator. The liquidator further avers that he had not received any claim to him as a liquidator nor has the Applicant submitted any evidence of amounts owed to him by TMP to justify this Application for the vesting order sought. The liquidator therefore concluded that the court should find that the Applicant has not demonstrated any good cause for the Application to be allowed.

Both parties filed written submissions and the same have been considered.

In resolving this matter, it is trite to make explanation as to what a vesting order is. Simply put, a vesting order is a court order that passes legal title in lieu of a legal conveyance.

See: Regal Constellation Hotel Ltd., Re, 2004 Can LII 206 (ONCA) (“Regal”)

It is an equitable remedy and is therefore, by its nature, discretionary, and results from a finding by a court that fairness demands that the court act in a way to transfer property from one party another.

Typically, this occurs once the court has determined that one party is entitled to ownership of specific property, another party has legal or beneficial title to that property, and it is appropriate that title to the property be transferred to the entitled party by way of court order.

 See: Macourtice Developments Inc. versus Clarington (Municipality), 2006 Can. LII 29991 (ON SC) at para. 26.

Vesting orders have their roots in the law of equity, the key to obtaining a vesting order lies in persuading the court that fairness and justice require the court to grant the order, or put another way, that the failure to grant a vesting order will not be sufficient to ensure a fair or just result.

In the instant case, according to the lease deed attached to the Notice of Motion as Annexture A, Clause 18 provided that:

“…. The Lessee on vacating and handing over the open vacant possession of the demised premises to the lessor, shall be entitled to remove and take away any or all such additions, installations, partitions, counters, telephones, exchange lines, computers/PCs cabling and all other office and business machines, fixture and fittings installed by the lessee.”

Annexture B is a letter dated 30^th July, 2012 and received in August 2012 by Muhebwe & Owor Advocates, Solicitor. It is addressed to the Liquidator of Telecom Management Partner.  In it, the Applicant through his Advocates was informing the Liquidator that he sought to exercise his right of reentry in respect of the demised land as the lease was no longer in existence and that should the Liquidator wish to remove the equipment erected on the land, he should inform the Applicant in writing 5 days from the date of the receipt of the letter.

From the affidavit on record, it is clear that the equipment was not removed but is also true that the Applicant subsequently reentered the premises. In considering the submissions and the evidence on record, I am of the opinion that that the liquidator of the Respondent did not get proper notices even if his firm was served and the notice duly received. That the law firm did not pass on the said information could be the reason why the Respondent was not informed and it is now trite law that acts of inadvertencies of counsels cannot be visited on parties.

It is also true that the equipment has been on the Applicant’s land for over a year from the lapse of the lease, which land the Applicant could have put to different use. The presence of the equipment has certainly deprived the Applicant of the alternative use of his land. This situation would in my view best be ameliorated by way of compensation by the Respondent through its liquidator who has clearly shown interest of doing so upon receiving any claims from the Applicant.

In my view, the Applicant still has openings which he can use to seek the removal and compensation for the continued existence of the equipment in his land after his reentry.

In the premises, the Applicant needs to exhaust that opening before he can come for equity demands that he should seek first the removal and compensation for the continued existence of the equipment on his land before he can seek to attach the equipment since he indeed did reenter his land but has only been inconvenienced by the equipment continuing being on his land.

It would therefore be prudent for the Applicant first to seek compensation from the Liquidator whom he should directly deal with. 

I would therefore be constrained to not grant the orders sought in the Application but direct that the Applicant to seek direct intervention of the liquidator for appropriate compensation. This I believe would be in the interest of justice and equity demands so.

Additionally, I would direct the liquidator to remove the equipment on the said land on full payment of compensation to the Applicant.

And since the liquidator has appeared in this matter, I would also direct that the liquidator meets the costs of this Application.

These orders are made at the High Court Commercial Division Kampala this 25^th day of June 2014.

Henry Peter Adonyo

Judge