THE REPUBLIC OF UGANDA

IN THE HIGH COURT OF UGANDA AT KAMPALA

(EXECUTION AND BAILIFFS DIVISION)

MISCELLEANOUS APPLICATION NO. 356 OF 2015

(ARISING FROM EMA NO. 2525 OF 2015)

(ARISING OUT OF HIGH COURT CIVIL SUIT NO. 200 OF 2014)

KIRANDA SARAH MUSANA ………………...…… APPLICANT / OBJECTOR

TOP FINANCE COMPANY (U) LTD ……………..…..… RESPONDNET

1. NASSER NAKKU
2. NAKKU HAKIM
3. ABDU KARIM KIRANDA ………… DEFENDANTS / JUDGMENT DEBTORS

BEFORE LADY JUSTICE FLAVIA SENOGA ANGLIN

By this application, the Applicant /Objector sought orders of this court, staying the intended sale of and releasing from attachment the land and or lease comprised in Plot No.12 School Lane, Iganga Municipal Council, Iganga District, in execution of EMA No. 2525/2015.

The grounds of the application are that the Objector claims interest in the property as the wife of the Third Judgment Debtor, the registered proprietor of the matrimonial home comprised in the said property.

That in the likelihood of the property being sold, the Objector will suffer irreparable loss.

The application is supported by the affidavit of the Applicant, where she contends interalia that she is the wife of the Third Judgment Debtor having got married to him on 12.08.1990 at Tororo Mosque.

That since then, they have been living with the Third Judgment Debtor as husband and wife and have four issues of the said marriage.

The property under threat of sale is matrimonial property and she is currently in occupation of the same.

That while the documents availed by the Bailiff indicate that the Third Judgment Debtor had pledged the property as security for repayment of a loan; it was without her knowledge and consent.

That therefore the property was wrongfully attached in execution and the sale ought to be stayed.

There is an affidavit in reply filed on 13.06.16 although the date it was deponed is not indicated.

The deponent of the affidavit, Fred Makoles, the Public Relations Officer of the Respondent Company.He claims that the contents of the affidavit of the Applicant/ Objector are false, as the property is used to run a school and is not a residential home, family or matrimonial property.

That the application is a plan by the Objector to deny the Judgment Creditor /Respondent the mortgaged funds.

The registered proprietor of the property and all concerned parties were notified of the intended sale by advertisement in Daily Monitor Newspaper of 26.09.14.

The property being a business property, there was need for the Applicant to consent to the deed of guarantee and further that the Applicant is not in possession of the property.

Without any proof that the attached property is family or matrimonial property, there is no need for court to stay execution.The application should be dismissed with costs to the Respondent.

There is an affidavit in rejoinder.

The application was heard on 14.06.16, Counsel went through the provisions of the law under which it was made, the contents there of, the affidavit in support and the affidavit in rejoinder.He also commented about the affidavit in reply emphasizing that the affidavit in reply, annexture B confirms that the property is residential property registered in the names of the Third Judgment Debtor who is husband of the Applicant.

Also that, the Applicant is in occupation and the property being used as a school is about 200 meters away from the attached property.

The property description of the Respondent is different from the property shown by the application.

The property valuation report shows children playing in the background.

The case of Trans Africa Assurance Co. vs. NSSF [1999] IEA 352 was relied upon to submit that, the question to be decided in cases of this nature is whether or not the Applicant is in possession of the property attached.

Counsel then argued that the evidence adduced shows that the Applicant, a wife of the Third Respondent is in possession of the property and hence this application.

Court was urged to find that the attached property is not liable for sale in execution and allow the application.

In reply, Counsel for the Respondent disputed the marriage between the Applicant and Third Respondent contending that no documents were attached to prove the same.

Referring to the affidavit in reply, paragraph 5, Counsel argued that the property is a commercial property used as a school.Referred to Annexture B to the affidavit.

That to grant the application will be to set a bad precedent in terms of transactions that involve commercial property.

Counsel stated that matrimonial property is defined under S.38 Land (Amendment) Act 2004, but that the Applicant did not prove the requirements of S.38.

The case of Julius Rwabinumi vs. Hope Bahimbisomwe SCCA 16/09 – was cited for the holding that “while the 1995 Constitution of Uganda recognizes the equality of men and women in marriage, it also reserves the constitutional right of individuals, be they married or not, to own property either individually or in association with others.”  Under Article 26(1) of the Constitution, “that if the framers of the Constitution wanted to take away the rights of married persons to own separate property in their individual names, they would have explicitly stated so.”

It was then argued that the property in dispute belongs to the Third Judgment Debtor.It was advertised in the Monitor Newspaper of 26.09.14.And if the Applicant wanted to object to the attachment, she ought to have done so during the civil suit.

Counsel contended that, the Third Judgment Debtor and the Applicant were colluding to defeat the interest of the Respondent.

Court was implored to apply equity and protect the rights of the Respondent.That the Applicant is not in possession of the property and is not utilizing it to derive sustenance from it and there is no proof that she is residing at the property.

It was then prayed that the application be dismissed with costs and execution allowed to proceed.

In rejoinder, Counsel for the Applicant referred to paragraphs 3 and 5 of the affidavit in support and rejoinder respectively.

He argued that the authority of the Supreme Court Civil Appeal relied upon by Counsel for the Respondent is not applicable to the circumstances of the present case.

Further that there is no proof of collusion between the Applicant and Third Respondent.He reiterated earlier prayers.

Court visited the locus in quo on 08.07.16 at the request of Counsel for the Respondent.

Both Counsel were present together with the Objector and a Representative of the Respondent.There were also other people listed by court in the proceedings of the day.

It was noted that the house in dispute is enclosed by a brick wall and has a blue gate.The wall on either side of the gate is painted white to cover the words “Good Will Primary School”.The court moved around the property but did not enter the premises.

The Applicant testified that the property has been her home since they set it up with the Third Respondent about 1993; she confirmed that she got married to the Third Respondent on 12.08.90 in Tororo.

And while they lived in Jeddah Saudi Arabia up to 1997, they would return to Uganda from time to time.They acquired the property in 1993, and moved in, in 1997.

While admitting that while the preparatory school used the premises in 2013, while she was in South Korea in January, 2013, the school was evicted and she moved back into the house, although she did not move the writings on the wall indicating it was a school.

When in March, 2016, the property was attached, that is when she got to know that the property had been used as security to borrow money by the Judgment Debtor.This was confirmed by the Third Judgment Debtor that when the Bailiffs showed her the plot of the property she told them they were at the wrong place.

In cross examination the Applicant confirmed that while the property is in the names of the Third Judgment Debtor, the property is family property.

Looking at the Applicant’s passport No. B0644598 issued on 28.11.07, Expiry 28.11.17, it has a visa issued by Korea on 24.01.13 – 24.04.13 – No 02687699.Another visa was issued on 11.04.13 – 11.05.13 – No. 02799542.

While it was agreed upon the Applicant’s return that the school leaves the premises at the end of 2013, they requested to leave in phases.When the children were taken away, the school kept on using the house as offices.

During the inspection of the premises, the court found the Third Respondent, three children of the Applicant and two grand children at the premises.There is a guest wing to the house – Refer to the drawings made by court.

Counsel for the Applicant maintained his earlier submissions emphasizing the issue to be determined in cases of this nature.

He asserted that it is clear from the testimony of the Applicant that, although she has been in and out of the Country, she has been in possession of the property since 1997.As the wife of the Third Judgment Debtor, she participated in acquiring the property.

She threw out the school in 2013, which had been put in the premises in her absence by her husband – Third Judgment Debtor.

While she stayed in the guest room to oversee the process of the school leaving the premises, she is currently staying there with her family.

Further that the Applicant had produced a photo of her wedding and proof that she is wedded to the Third Judgment Debtor and therefore a wife, who has a right to object to the attachment.

Insisting that the house was rented to the school during the Applicant’s absence, Counsel prayed that the application be allowed.

Counsel for the Respondent also maintained her earlier submissions that the Applicant had not sufficiently proved marriage to the Third Judgment Debtor.She relied upon the case of Wamono Shem vs. Equity Bank Ug Ltd & Constance Wachamba. Where Justice Madrama held that “court should not encourage unregistered marriages to operate as constructive notice or rely on presumptions of marriage where there are third party rights which will be unfairly affected.”

Counsel argued that the Applicant presenting photos is not sufficient proof of marriage to the debtor and does not give her locus to bring the application before court.

Also that the property could not be matrimonial property when the school was in occupation from 2013 – 2015.This was contrary to S.2 of the Mortgage Act that defines matrimonial home to mean “a building or part of a building to which a husband and wife ordinarily reside together.”

The Applicant’s testimony, Counsel emphasized is to the effect that, until 2015, they were not ordinarily residing in the building.

It was pointed out that in Wamono Shem’s case (Supra); court held that “where the spouse is living in the property, then there is constructive notice of occupation.”

But in the present case, she argued, by the time the property was mortgaged, the Applicant was not residing there.

Further that, it is also not in dispute that the property is registered in the names of the Third Judgment Debtor and there is no law barring a spouse form owing individual property – Refer to Julius Rwabinumi’s case (Supra).

In light of the above, Counsel prayed for dismissal of the application with costs.

In rejoinder, it was the submission of Counsel for the Applicant that Wamono Shem’s case is distinguishable from the current case, as the Applicant in that case had indicated in her affidavit that she was not married at all to the Second Respondent.By turning around to claim she was married, court found it was a misrepresentation and accordingly dismissed the application challenging the mortgaged.

Counsel argued that, that was not the case in the current application and reiterated earlier prayers.

The issue for court to determine is whether stay of execution should be granted and the property attached released from attachment.

I carefully listened to the submissions of both Counsel, visited locus in quo and made certain observations set out on record.I have given the submissions of both Counsel the best consideration I can in the circumstances.

Decided cases indicate that “the granting of or otherwise of an order of stay of execution is at the discretion of the court.  In exercise of this judicial discretion, the court as and where is relevant considers a number of factors, notably, whether the refusal to grant stay is likely to cause substantial and irreparable injury or loss to the Applicant, Whether the injury or loss cannot be atoned by damages; balance of convenience, and whether prima facie the intended appeal has likelihood of success.  Above all, further to considering the above factors, the court takes into account the individual circumstances and merits of the case in question.” - See Universal Petroleum Services Ltd vs. BP Tanzania Ltd [2006] IEA 486 (CAT).

In the present case, the Applicant applied for stay as an Objector claiming that the property attached is matrimonial property and that she never gave her consent as required by law, when the Third Judgment Debtor her husband was mortgaging it to the Respondent.Further that she and her family are currently in occupation of the property although during her absence sometime in 2013, the Third Respondent mortgaged the property as security for a loan and put a school in occupation of the same.

Upon her return, the school was evicted although it was given time to move and used the property as offices until 2015.

During that period, the Applicant and the family stayed in the guest wing of the house attached to the property.

The Respondent objected contending that there was no proof of marriage of the Applicant and Third Respondent and that at the time, property was attached the Applicant was not in occupation of the same.

Considering the circumstances of the present case, this court finds that the Applicant adduced sufficient evidence to establish interest in the disputed property as the wife of the Third Judgment Debtor.While no certificate of marriage was produced, the photographs of the wedding of the parties shift the balance of convenience in favor of the Applicant.The case of Wamono Shem (Supra) is not applicable to the circumstances of the present case, as the Objector in Wamono’s case had clearly stated that she was not married to the Judgment Debtor.

This court does not dispute the constitutional right of parties to own individual property.But the claim of the Applicant that she contributed to the acquiring of the property in the present case was not rebutted.

The visit to the locus showed that the property was not occupied by the school, although there were writings next to the gate that indicated that the property had been used by the school at some time.

Indeed there is a school about 200 meters away from the property.Lending credence to the Applicant’s claim that the school had been moved.

The Applicant’s family that is, Third Respondent and her grand children were at the premises, and there was nothing to indicate that the Applicant was not in occupation.

The claim by the Respondent that the property did not belong to the Applicant did not amount to controverting her claim.

The fact that the property if not registered in the Applicant’s name is not detrimental to her claim as co-owner of the property.

The balance of convenience in the circumstances demands that the application be allowed and the property released from attachment.

The refusal of staying execution is likely to cause substantial and irreparable injury to the Applicant, more so when the property was given as security in her absence and therefore she could not have given her consent.

The prolonged stay of the school in the premises after her return was sufficiently explained.

It was the duty of the Respondent to have carried out due diligence to establish the actual ownership of the property before accepting it as security.

The Respondent can resort to other means to recover the amount of money due from the Third Respondent instead of selling the property.

The application is allowed for all those reasons.

The property is released for this from attachment.

The costs to be paid by the Third Judgment Debtor.

FLAVIA SENOGA ANGLIN

JUDGE

12.01.17