IN THE SUPREME COURT OF UGANDA
HOLDEN AT MENGO
Coram: Oder, Tsekooko, Karokora, Mulenga, and Kato JJSC
CIVIL APPEAL NO. 14 OF 2002
BETWEEN
MOHAN MUSISI KIWANUKA :::::::::::::::::::::::::::::::::::::::::::
APPELLANT
AND
ASHA CHAND
:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::
RESPONDENT
(Appeal from the judgment of the Court of Appeal of Uganda
(Mukasa-Kikonyogo DCJ, Engwau, Twinomujuni JJA) at Kampala, dated 8th
May 2002 in Civil Appeal No. 53 of 2001).
JUDGMENT OF MULENGA JSC
This appeal originates from a counter-claim in High Court Civil Suit No.
1/94. The main suit was instituted by Mohan Musisi Kiwanuka,
"the appellant"
claiming that he was lawful owner of Plot No. 2 Impala Avenue, Kampala,
"the suit property", and praying for, inter alia an order
restraining Asha Chand, "the respondent", from interfering with his
rights over the suit property. The respondent defended the suit claiming
inter alia that she was entitled to the suit property. She
counter-claimed for vacant possession and mesne profits. The suit was
dismissed for want of prosecution. Upon trial of the counter-claim, judgment was
entered for the respondent for vacant
possession, shs 183 million as mesne
profits for the period up to 16 Sept.'02 and further mesne profits,
at the rate of shs. 1.75 million per month, until vacant possession. She was
awarded interest and costs. The Court of Appeal upheld
that decision; hence this
appeal.
The suit property is expropriated property under provisions of the
Expropriated Properties Act, 1982, "the Act". The dispute over the
property centres on two competing certificates the Minister of Finance, "the
Minister", issued to the parties to the dispute. First, on 24 June '91, the
Minister issued Certificate of Purchase No 0039, "the purchase certificate",
to the appellant as purchaser of the suit property. Then on 16th
Sept '93, the Minister issued Certificate Authorising Repossession No. 1643,
"the repossession certificate", to Karam Chand, as former owner of the
same property. The respondent is widow and executrix of the will of Karam Chand.
She was sued
and she counter-claimed in that capacity. In the background to this
appeal, are several suits and applications to which I have to
refer because of
their substantial impact on the out come of the counter-claim. For clarity I
will first summarise the facts related
to the issuance of the two certificates,
and then refer to the said suits and applications.
The
Certificates
On 16 May '83, the appellant, under provisions of the
Act, lodged a claim of interest in the suit property, on the ground that in
1979
he had purchased and paid value for, and thereafter had incurred expenses in
improvements on, the suit property. In response
to that claim, the Minister
wrote to the appellant on 12 March '91, informing him that Government had
decided that he "may purchase the property under a new purchase contract
with the Government", at shs. 50,000/=. The appellant accepted the offer
and was issued with the purchase certificate. It was entered on the Certificate
of Title on 26 July '91 as Instrument No 248784. Subsequently, the respondent
applied for repossession of the suit property. On 2
Oct '92, the Departed Asians
Property Custodian Board, "the Custodian Board", a corporate body that
manages expropriated properties under the Minister, wrote to the respondent to
say that the property had been
sold, and that "compensation will be paid
in accordance with Government Policy". Later, however, the Minister
issued the repossession certificate to her. But it appears that when the
respondent submitted the repossession
certificate for entry on the register it
was not readily entered. Hence, on 21 Oct '93, the Minister wrote to the
Commissioner for
Land Registration (in response to the latter's letter not on
record), explaining that the suit property had been repossessed by the
former
owner, and that "Certificate No 0039.... was therefore
nullified".
The Commissioner conveyed the Minister's new stand to the appellant in a
letter of 3 Nov '93, and intimated that he would cancel the
appellant from the
register and reinstate the former owner unless within 21 days, the appellant
showed good cause why he should not
do so. I will shortly revert to the
appellant's reaction and the Commissioner's response. It suffices at this stage
to say that for
nearly six years thereafter, the Commissioner did not alter the
status quo. He eventually did however, on 30 April '99, when he cancelled
the purchase certificate from the certificate of title and entered thereon
the
repossession certificate as Instrument No 301201.
Some Pertinent Suits and Applications
The main suit in the
background, is High Court Civil Suit No. 693/92, which the respondent instituted
against the Attorney General,
"appealing against the rejection of her
application for repossession. The Attorney General pleaded in response, that the
suit property had been
disposed of by the Minister under the Act, and that the
Government was willing to compensate the respondent. The appellant applied
to be
joined to that suit as co-defendant in order to protect his interest. When
subsequendy the Minister issued the repossession
certificate, the respondent
abandoned the suit as against the Attorney General, but proceeded against the
appellant as sole defendant.
She succeeded in the High Court. On appeal, by the
appellant, the Court of Appeal in Civil Appeal No. 27/98, held that the trial
in
the High Court was a mistrial. The main ground for so holding was that after the
Attorney General was dropped out of the suit,
the proceedings became
misconceived because the respondent had no cause of action against the
appellant. For that reason no retrial
was ordered. With due respect, I do not
agree with that view as will become clear later in this judgment. Be that as it
may, that
decision of the Court of Appeal, while not giving rise to res
judicata, it virtually had that effect in the decision of the counter-claim,
both in the trial and in the first appeal. I will revert to that
shortly.
Miscellaneous Application No. 183/93, is another notable
case in the background. It was instituted by the appellant upon being advised
by
the Commissioner for Land Registration that he intended to deregister him. In
it, he applied under provisions of the Registration
of Titles Act, "the RTA",
that the Registrar of Titles be summoned before the court to
"substantiate the grounds upon which he intends to cancel" his
registration. On 1 Dec '93, the Commissioner wrote to the appellant's advocates,
(in response to their letter not on record, apparently
explaining why the
appellant should not be deregistered), intimating that he was satisfied with
their explanation, and advising thus:
"In the circumstances then you
may have to save yourself the bother and expenses of prosecuting High Court
Miscellaneous Application
No. 183/93".
This appears to explain why for so long the repossession certificate was not
entered on the register of titles. Meanwhile, the appellant
appears to have
heeded the Commissioner's advice not to pursue the application.
Instead, in early Jan.'94, the appellant instituted High Court Civil Suit No.
1/94 against the respondent. In the plaint, he claimed
that he acquired
ownership of the suit property in 1979, as "bona fide purchaser for value
without notice" and in the alternative, that he acquired it by virtue of the
purchase certificate under the Act. He prayed for, inter alia, a
declaration that he is the lawful owner of the suite property, and for an order
restraining the respondent from holding herself
out as the owner, or from
interfering with his possessory and proprietary rights over the same. The
respondent filed a defence and
counter-claim, contending in the defence:
| • | that by virtue of the
repossession certificate she was entitled to possession, control and use of the
suit property; |
| • | that her certificate
could be challenged only through an appeal under section 14 of the Act;
and |
| • | that the appellant's purchase
certificate was bad in law |
In the counter-claim she
repeated the rights she claimed and pleaded that she suffered loss and damage
because the appellant refused
to vacate the suit property. She prayed for vacant
possession, mesne profits, interest and costs. It is from that
counter-claim that this appeal originates.
The appellant made several
applications before the counter-claim was finally tried. The first was in March
'94, asking that the Attorney
General be joined to the main suit on the ground,
inter alia, that it was necessary in order to enable the court to
"effectually and completely adjudicate upon and settle all questions
involved" in the suit. Ultimately that application was side tracked, and
was never decided. When it came up before the learned Principal Judge,
his
attention was drawn to the existence of Civil Suit No. 693/92, and the fact that
the same issues would arise in both suits. In
the ensuing arguments, the
possibility of consolidating the two suits was glossed over, but was not
pursued. Instead, the learned
Principal Judge entered the following consent
order on 20 June '94, "Civil Suit No. 693/92 shall proceed first and Civil
Suit No. 1 of 1994 shall proceed thereafter." Two and half years later,
on 11 Dec. '96, in absence of the parties, the Principal Judge addressed the
following order to the Deputy
Registrar (Civil): "Counsel for both parties
undertook to proceed with an earlier suit to comply with S. 6 of the CPA. It is
now more than two years
since 24.6.94, and not anyone has tried to set this one
down for hearing. I dismiss it for want of prosecution." However, the
earlier suit, Civil suit No 693/92, was still proceeding in the High Court. It
was completed a year later, on 19 Dec.
'97. Even then, as I indicated earlier,
it went on appeal, as Civil Appeal No. 27/98. It seems to me therefore, that the
dismissal
of Civil Suit No. 1/94 was premature. I am surprised that the
appellant never moved the court to reinstate it.
The other applications were made after the appellant was deregistered on 30
April '99 and after the Court of Appeal had concluded
Civil Appeal No. 27/98. On
3 Dec. '99 the appellant applied that the hearing of the counter-claim be stayed
pending disposal of Civil
Appeal No.223/99. He had apparently filed the latter
against the Attorney General, challenging the Minister's decision. It was
alleged
that he filed it pursuant to a court order by Byamugisha J., extending
time. Without purporting to review the order extending time,
the learned
Principal Judge rejected the application on the ground that " Civil
Suit
No.223/99 was illegally filed", since it was filed outside the
time prescribed under section 14 of the Act, and Byamugisha J., had no
jurisdiction to extend that
time. In reaching that decision, the learned
Principal Judge was clearly swayed by what he called "a pronouncement
made by the Court of Appeal in Civil Appeal No.27/98. He said;
-
"Air page 11 of the Court of Appeal judgment a pronouncement
was made in the last paragraph which in my view ruled out Mohan Musisi
Kiwanuka's any chance of ever bringing a suit against the Attorney General over
the suit property. The court stated:-
'Before the
application was heard the Minister granted to the respondent a certificate of
repossession. That gave to the appellant a distinct cause of action under
S.14 of the E.P.A. He should have filed an appeal against it before the
expiry
of 30 days. This was the only course open to the appellant in the
circumstances. On the other hand if the respondent wanted to have the
appellant's name (removed) from the register of the suit property and to
recover
mesne profits from the appellant this could not be done through an appeal filed
pursuant to S.14 of the E.P.A., she would
have to file a different civil suit in
the High Court in order to enforce these rights. In my judgment the continuance
of this suit
after the Minister of Finance had issued a certificate of
repossession (on 16/9/93) amounted to a mistrial.'
What I can gather from the judgment are
the
following:-
| (a) | That
Asha Chand is ... the owner of the suit
property; |
| (b) | That
to obtain eviction of Mohan Musisi Kiwanuka, she should institute a civil suit
for eviction;
and |
| (c) | That Mohan
Musisi Kiwanuka who should have brought an appeal against the Minister's
decision to grant to Asha |
Chand the
certificate of repossession lost the only chance
he had
to wit bringing that appeal against the Attorney General within 30
days from 16/9/1993."
I have reproduced this long extract because, in
my opinion, it provides an insight into the reasoning about, and treatment of,
the
counter-claim in the lower courts. Both at the trial and on first appeal,
the so called pronouncement was treated as if it was a
binding court
decision.
The last two applications were heard by Arach-Amoko J., before she commenced
the trial. In one of the applications, the appellant
sought leave to amend his
defence to the counter-claim by pleading expressly that he was in possession of
the suit property by virtue
of the purchase certificate issued to him under the
Act. In the other he sought an adjournment with a view to apply, inter alia
to join the Registrar of Titles as a party for having removed his name from
the register. Both applications were rejected because,
in each, the learned
Judge considered that the appellant was seeking to revive the question of
ownership raised in his dismissed
suit. Additionally, in the former, she held
that the amendment would have drastically changed the character of the
counter-claim.
I am constrained to observe here, that this background demonstrates how undue
regard to technicalities can obscure real issues, to
the prejudice of
substantive justice. It is a cardinal principle in our judicial procedure, that
courts must, as much as possible,
avoid multiplicity of suits. Thus it is that
rules of procedure provide for, and permit where appropriate, joinder of causes
of action
and consolidation of suits. Related to that, is the courts' duty to
expedite dispensation of justice. I have no doubt that the dispute
in the
instant case would have been resolved expeditiously, but for the erroneous
insistence that the competing claims could not
be tried together. With due
respect, there was no sound reason why the appellant's application in 1994, to
join the Attorney General
to Civil Suit No.1/94 was not allowed, or why that
suit was not consolidated with Civil Suit No.693/92. Furthermore, I respectfully
disagree with the opinion expressed in the so-called "pronouncement",
that the latter suit could not proceed as between the appellant and the
respondent, after the Attorney General was dropped out of
it. The suit involved
not only the rejection of the respondent's application for repossession, but
also the issuance of the purchase
certificate to the appellant. The appellant
was the registered owner in possession of the suit property. On his application,
he was
quite properly in my view, joined as a party, because the suit affected
his vested interest. Clearly, there were triable issues as
between the two
parties, which issues were properly before the court.
Appellant's claim of ownership on appeal
In the written
submissions, Messrs Nangwala, Rezida & Co Advocates for the respondent,
contend and argue at length, that the appellant's
claim of ownership of the suit
property should be excluded from consideration in this appeal. There are two
aspects of the contention,
namely -
| • | that the arguments in
support of the claim in the appeal, are an attempt to revive the appellant's
claims in his dismissed suit; and |
| • | that
since those arguments constitute a challenge to the Minister's decision, the
court cannot consider them, because the counter-claim
is not "an appeal"
under section 14 of the Act. |
To the extent the
contention relates to pleading and the court's competence, I find it appropriate
to treat it like a preliminary
point of law, though not so raised. I will
dispose of it first. On the first aspect, counsel argue that the appellant's
plea of ownership
of the suit property did not survive the dismissal of his
suit, and so it was not an issue in the trial of the counter-claim suit.
In
asking for adjudication on it now, the appellant seeks to "revive the
dismissed suit through the backdoor". The argument on the second aspect
is that, because the claim conflicts with the issuance of the repossession
certificate, it is a
challenge of the Minister's decision, and can only be
brought in an appeal under section 14 of the Act, in which the Attorney General
is a party, and the issue to determine is whether the decision was correct or
wrong. The counter-claim was no such appeal. The Attorney
General was not a
party in it, and the issues in it did not concern the Minister's decision but
the respondent's rights over the
suit property. Needless to say, these arguments
are in line with the decisions of the courts below.
In her judgment, the learned trial judge stressed that the appellant had
raised the question of ownership of the suit property, in
his Civil Suit No.
1/94, which was dismissed, and that the only matter before her was the
counter-claim. She held that because the
counter-claim was not an appeal under
section 14 of the
Act, she had "no jurisdiction to entertain issues challenging the
decision or action of the Minister" as they were not brought
"in accordance with procedures laid down by the Act". In upholding
the trial court decision, the learned Justices of Appeal reiterated that the
counter-claim was not an appeal against
the decisions of the Minister, and
concluded that the trial court did not err in refusing to consider the purchase
certificate because,
it ceased to be an issue upon the appellant failing to
challenge its cancellation in time.
Messrs Buwule & Co.,
Advocates for the appellant, submit that in a suit for ejectment, a plaintiff in
order to succeed, must plead
and prove a title which is superior to that of the
defendant. On the other hand, a defendant who is in possession may rely on such
possession only, without pleading title. Counsel argue that the counter-claim,
in the instant case, was such a suit for ejectment,
and that the appellant was
entitled to plead that in addition to being in possession, he had a superior
title. He did so by the plea
that he was granted the purchase certificate under
the Act, and became registered proprietor when the certificate was duly entered
on the title. That plea was a defence to the counter-claim, and it survived the
dismissal of the main suit because the relevant averments
in the suit plaint,
were incorporated in the defence to the counter-claim by reference. Counsel
maintain that the appellant, as defendant
in the counter-claim, was not barred
from pleading that his purchase certificate is valid, and even that the
respondent's repossession
certificate was null and void. The trial court ought
to have considered the defence and decided it on merit, rather than reject it
on
the technicality that the court lacked jurisdiction. On jurisdiction, counsel
for the appellant submit that the High Court has
inherent jurisdiction to
investigate any illegality brought to its attention in any proceedings before
it, and argue that in his
pleading, the appellant challenged the Minister's act
of issuing the repossession certificate as an illegality, which the court was
competent and under duty to investigate.
I agree that the appellant's claim of ownership of the suit property, was
incorporated in the defence to the counter-claim when, in
paragraph 1 of the
"Reply to the Written Statement of Defence and Counter-claim" he pleaded
that: "The Plaintiff repeats all the averments in the
Plaint".
The dismissal of the plaint did not wipe out or in
any way affect that pleading. The pleading remained, albeit by reference. If the
trial court had allowed the appellant to amend, as I think it should have, the
averments would have been expressly incorporated,
but as a defence. Neither
would the dismissed suit have revived, nor would the counter claim have changed
character. The claim ceased
to be "a sword" when the main suit was
dismissed, but it remained "a shield" in the counter-claim action. I
should add, for emphasis, that although no appeal was taken against the ruling
denying leave to amend,
the defence remained as pleaded by reference, since it
was not struck out. The appellant's two defences to the counter-claim therefore,
were that he was in possession with a superior title, and that the respondent
had not suffered the loss pleaded in the counter-claim.
In reiterating the
former defence on appeal, he does not depart from his pleadings.
In view of my finding, that appellant pleaded ownership in defence, it
follows that the purchase certificate on which the plea is
founded was in issue.
Issues Nos.1, and 3 which were framed thus:
"1. Whether the Defendant
(appellant) is liable to give vacant possession.
3. Whether the Defendant (respondent) is liable to pay
mesne profits"
could not be properly answered without considering the
appellant's claim of ownership, and therefore, the validity of the purchase
certificate on which the claim is founded. The existence of the certificate may
well not have been in dispute as is implicit in the
court's ruling on the
objection to its being received in evidence during trial where the judge said
that it was unnecessary as "It is already mentioned in Exh. P3".
However, its validity and effect was an implied sub-issue.
The second aspect of the respondent's contention, like the holding by the
courts below, that the trial court was not competent to
consider the appellant's
claim of ownership in the proceedings before it, is also untenable. While a
court may properly hold-
• either, that as a matter of law, the defence pleaded is not
available;
• or, that as a matter of evidence, the defence pleaded is not
established;
it is not open to a court to hold that it has no
jurisdiction or competence to try the defence case or part of it, and then
proceed
"to try" the plaintiffs case alone or with a reduced defence.
Clearly, if a court has no jurisdiction over part of the case before it, it has
no jurisdiction to try the case. But that was not the situation in the instant
case. Counsel for the respondent seek to explain,
notwithstanding the expression
used by the courts themselves, that what was meant, was not lack of
jurisdiction, but absence of proper
proceedings, i.e. an appeal under section 14
of the Act. They liken the position to a court declining to invoke its criminal
jurisdiction
to make a penal code order in a civil suit.
The apparent basis of the respondent's contention, as well as the court
holding, is the notion that the appellant's claim of ownership
of the suit
property, could only be pleaded under section 14 of the Act, in an appeal
against the Minister's decision. With due respect,
my considered opinion is that
the notion is misconceived. First, section 14 of the Act neither vests a new
jurisdiction in the High
Court, nor lays down any special procedure for
appealing against a decision of the Minister. I would reiterate what I said in
Habre International Co. Ltd. Vs. Ebrahim Alarakia Kassak & Others,
Civil Appeal No. 4/99, that "an appeal" under section 14 of the Act
is not a judicial appeal. The minister, in exercise of power vested in him by
the Act, makes administrative
decisions. Section 14 of the Act directs that a
person aggrieved by such a decision may appeal to the High Court, within a
period
of thirty days. Apart from that time limit, the Act does not stipulate
any special procedure for instituting the appeal or challenge,
against the
Minister's decision. The challenge can be done in an ordinary civil suit. Nor am
I persuaded that the appellant's claim
in defence that he had a superior title,
is analogous to a litigant's prayer for a penal code order in a civil suit. The
defence
is a civil claim, in a civil suit. Secondly whether the appellant had
needed to appeal under Section 14 of the Act depended on the
status of his
purchase certificate on which the claim was based. The court was competent to
determine, after due trial, that the
certificate was subsisting. It could also
determine that it was not, either because the certificate was not lawfully
issued, or because
it was lawfully revoked or cancelled or otherwise annulled.
Thirdly, the mere absence of the Attorney General from the counter-claim
suit,
could not render the court incompetent. Under Order 1 Rule 10(2) of the Civil
Procedure Rules, the court has wide powers to
order that a person
"whose presence before the court may be necessary in order to enable
the court effectually and completely to adjudicate upon and settle
all questions
involved in the suit, be added".
The pleadings in the instant case showed that the real controversy was on
ownership of the suit property, with each party relying
on a certificate
purportedly issued by the Minister under the Act. The trial court could have
invoked its powers, if it deemed the
presence of the Attorney General to be
necessary, to order that the Attorney General be added to the suit, instead of
disclaiming
jurisdiction or competence because of his absence from it.
Ironically, as I pointed out earlier in this judgment, when the appellant
formally applied to join the Attorney general to the suit, the application was
never considered.
In summary my conclusion on the preliminary point is as follows: (a) The
appellant was not precluded by any law, from pleading his
claim of ownership
based on the purchase certificate, (b) He pleaded it by reference as a defence
to the counter-claim, (c) The validity
of the purchase certificate, on which the
claim is founded, was implicit in the issues framed for trial, (d) The trial
court was
competent, to determine if that certificate was valid, and it was a
misdirection to hold that it was not so competent, (e) In pursuing the
claim of ownership of the suit property in this appeal, as a defence which the
courts below refused to consider, the
appellant has not departed from his
previous case. I would, therefore, not exclude the claim from consideration in
this appeal.
Grounds of Appeal
I now turn to the grounds of appeal. I will consider together, grounds 1 and
5 because they appear to be inter-related. The appellant
complains in these
grounds, respectively, that the learned Justices of Appeal —
• erred in law in failing to determine his rights in the suit property;
and
• failed to properly evaluate all the pleadings and the evidence of the
parties.
On ground 1, the core contentions are that upon
entry of the purchase certificate on the title on 26 July 91, the title to the
suit
property was lawfully transferred to the appellant; and that issuing of the
repossession certificate subsequently, did not affect
his title because, in
respect of that property, the Minister no longer had any power of disposal. The
argument on ground 5, which
is premised on those contentions, is that the
appellant was not liable to give vacant possession or to pay mesne
profits, because, by virtue of the said title his occupation of the suit
property was lawful. Messrs Buwule & Co., Advocates, submit that
the holding
to the contrary resulted from the failure by the courts below to appreciate the
appellant's interest in the suit property,
as pleaded and as proved.
Let me put in summary form, the very lengthy arguments advanced by counsel in
support of these contentions.
• The purchase certificate "clothed" the appellant with
equitable title to the suit property and upon its registration, the legal title
vested in him in accordance with
Section 91(2) of the Registration of Title Act
(RTA). The property thereupon ceased to be "expropriated property"
under the Act. The appellant could only be divested through legal
impeachment of the title e.g. for fraud under section 184 of the
RTA;
• The Act does not empower the Minister to revoke a certificate issued in
disposal of an expropriated property. The Minister
becomes functus officio
in respect of any property he disposes of under sections 4, 5, or 8 of
the Act. Besides, in the instant case, neither did the Minister
purport to
expressly revoke the purchase certificate, nor did the repossession certificate
issued later, have the effect of annulling
it; and
• The appellant, who was in possession on strength of having acquired the
suit property in accordance with the Act, could not
be liable to give to the
respondent vacant possession of the same or to pay to her mesne
profits.
On the two grounds of appeal, Messrs Nangwala, Rezida & Co. Advocates for
the respondent contend that, the appellant did not acquire
any title or rights
over the suit property by virtue of the purchase certificate, and that the lower
courts correctly decided that
the respondent was entitled to vacant possession,
and mesne profits. I will also put in summary form, the arguments
advanced in support of that contention.
• The purchase certificate is void and does not constitute a disposal of
the suit property under the Act
-
| (a) | because, the
sale in respect of which it was issued was in error for being based on the
nullified 1979 purchase; and |
| (b) | because, the
Minister did not comply with mandatory provisions of Section 8 of the Act, and
Regulation 11 of Statutory Instrument
No. 6 of 1983 governing the procedure for
sale of properties under the Act. |
• The purchase certificate was not produced in evidence;
• The evidence adduced, showed that its entry on the certificate of title
was cancelled, and therefore, the appellant could
not establish a defence to the
counter-claim relying on the cancelled entry;
• Because the purchase certificate was not legally issued under the Act,
it did not "clothe" the appellant with any interest in the suit property,
or protect him against a suit for trespass; nor did it render the Minister
functus officio under the Act;
• In contrast, the respondent adduced evidence, which proved, not only
that she was issued with the repossession certificate
under the Act, but also
that she was the registered proprietor of the suit property. Her certificate of
tide was conclusive proof
of ownership of the suit property, and could only be
impeached if she was guilty of some fraudulent act;
• The basis of the respondent's claim for vacant possession and mesne
profits was the repossession certificate under the Act,
not the registration
under the RTA. Accordingly, the respondent became entitled to vacant possession,
and to mesne profits, from the time she obtained the repossession
certificate, not from its entry on the certificate of title.
I am constrained to observe that the submissions from both sides underscore
the point I highlighted earlier in this judgment, that
the dispute underlying
the counter-claim is not merely what remedy the respondent was entitled to, but
the ownership of the suit
property. Even counsel for the respondent, without
conceding the point, recognise that it is imperative to ascertain which claim
is
superior to the other. They assert in their written submissions that this Court
is not invited "to make a finding on the propriety of the purchase
certificate", yet they take a lot of time and space to strenuously argue
that the appellant's certificate is not a valid purchase certificate and
that
the repossession certificate is lawful and has never been impeached.
The judgments of both courts below are premised on a silent presumption that
upon issue of the repossession certificate, the appellant's
title to the suit
property, if any, ceased. They then conclude that it became irretrievable upon
his failure to appeal under section
14 of the Act. With due respect, that is not
a correct premise. The repossession certificate is not conclusive evidence that
it was
issued lawfully. In my view, from both the pleading and logical points of
view, the correct entry point in this dispute must be the
purchase certificate.
It is not in dispute that the repossession certificate was issued more than two
years after the purchase certificate
had been issued and entered on the register
of titles. When the respondent instituted her counter-claim suit, the respondent
was
not only in possession, but he was also still the registered proprietor of
the suit property. Having regard to the pleadings and
the evidence, the court,
before deciding as it did, ought to have satisfied itself-
• either that the appellant did not lawfully acquire title to the suit
property;
• or that the title was lawfully divested/transferred from
him;
Neither court below did so. I think this Court can do so
from the material on the record.
Did the appellant lawfully acquire title to the suit property or
not?
Whether or not the appellant acquired the title lawfully,
depends on the validity of the transaction leading to the issue of the purchase
certificate to him. According to the respondent's counsel, the defects in the
transaction are the regard that the Minister had for
the nullified 1979 purchase
and the Minister's failure to comply with mandatory statutory provisions on sale
procedures. Section
8 of the Act vests in the Minister power to dispose of
expropriated property where, neither joint venture under section 4, nor
repossession
under section 5, is realised. So far as is relevant to the instant
case, section 8 provides-
"8. (1) Where
(a) a former owner of any property or business does not apply for
repossession within the period specified under section 3 of this
Act,.... the
Minister may make an order that the property or business be retained by
Government, or be sold or disposed of in such
manner as may be stipulated in the
Regulations made under the Act,
(3) The Minister shall issue a
certificate to the purchaser or recipient of any property or business sold or
otherwise disposed of
under the provisions of this section and such
certificate shall have the same effect as a certificate issued under sections 4
and 5 of this Act." (emphasis is added) Section 6 of the Act
provides that a certificate issued under section 4 or 5 shall be sufficient
authority for,
inter alia, the Chief Registrar of Titles to
transfer title to the person to whom the certificate is issued. Therefore, the
purchase certificate
issued under section 8, is such sufficient authority. Under
Regulation 11 of the regulations made under the Act, (S.l No.5 of 1983),
it is
stipulated that where the Minister makes an order under section 8, that
expropriated property be sold, the property shall be
valued by a Board of
Valuers; and shall be sold by competitive tender, subject to a reserve price
determined by that Board. Counsel
for the respondent maintain that this
procedure was not complied with. That appears to be so, particularly in view
of the Minister's
letter to the appellant dated 12th March 1991. He
wrote in part -
"Please refer to the claim of interest lodged with the Verification
Committee on 15th May, 1983, in respect of the above property which
you had purchased from Mr. Ibrahim Minawa prior to the commencement of the
Expropriated
Properties Act of 1982 ... This is to inform you that after careful
consideration of your claim and the provisions of the... Act
in so far as they
relate to the property and the transaction between you, the former owner and Mr.
I. Minawa, Government has decided
that you may purchase this property under a
new purchase contract with the Government at a consideration of Shs.50,000/= I
am therefore
advising you to pay the above sum and thereafter produce the
evidence of such payment to the Ag. Executive Director to facilitate
preparation
of the necessary certificate of purchase." From this offer, it is
obvious that the Minister deliberately decided to sell the property to the
appellant without competitive tender
or reserve price stipulated in Regulation
11. He had regard to the 1979 purchase but offered to sell to him, under
"a new purchase contract with the government". In so doing the
Minister did not purport to revalidate the 1979 purchase transaction as argued
by the respondent's counsel. Rather
he recognised that in absence of the former
owner's claim, the appellant's claim of interest in the property equitably
ranked next,
and that it would be unconscionable to require him to pay full
value a second time for the same property. To my mind that claim of
interest was
a legitimate consideration in the exercise of the Minister's discretion under
section 8 of the Act. It did not vitiate
the "the new contract". I
should point out that the 1979 purchase was not an "illegality".
The Act nullified it, but did not render it illegal or void ab
initio. That is why the Act recognizes the interest of a purchaser such
as the appellant, whose purchase it nullifies.
Regulation 11 directs that the stipulated procedures be followed in sales of
expropriated properties. It does not however, preclude
the Minister's discretion
to dispose of property in any other way, including sale for nominal or token
price. Counsel for the respondent
forcefully argue that every disposal called
"a sale" must strictly comply with regulation 11. On surface, that
argument sounds attractive. However, I am not persuaded because the implication
would be that the Minister, without involvement of a Board of Valuers and
competitive tender, can lawfully dispose of property otherwise
than by sale, but
has no power to do the same if, as in the instant case, he asks for a nominal or
token price. That cannot have
been the intention of the legislature. In my view,
the procedures were not intended to limit the Minister's discretion, in
appropriate
circumstances, to dispose of the property as he deems appropriate. I
conclude that the purchase certificate was lawfully issued under
the Act, and
that upon its entry on the register on 26 July '91 the appellant acquired the
legal title to the suit property.
Was the appellant lawfully deprived of the title?
Both
courts below avoided pronouncing themselves definitively on the appellant's
interest arising from the purchase certificate. However,
in their respective
judgments, the thrust is that any interest the appellant had in the suit
property, ceased when the repossession
certificate was issued, and any right to
claim it, was put beyond reach by his failure to appeal in time, against the
Minister's
decision to issue the repossession certificate. Both judgments
revolve on the remarks made by Twinomujuni J.A., in Mohan Musisi Kiwanuka
vs Asha Chand, Civil Appeal No. 27/98, which I reproduced earlier in
this judgment. The learned trial judge reproduced them in part in her judgment,
and the Court of Appeal re-echoed them in the lead judgment of Engwau
J.A.
Secondly, both courts placed reliance on the fact that the respondent was in
the end registered proprietor. In her judgment, the learned
trial judge held
that the respondent's case was based on the Act, not the RTA, but observed that
under S. 56 of RTA, a certificate
of tide is conclusive evidence of ownership.
She went on to say -
"The evidence adduced before this court (Exhibit
P3) shows that the registered proprietor of the suit property is Karam Chand
that
all other certificates issued prior to 30/4/99 have
been
cancelled."
In the said lead judgment of the
Court of Appeal, Engwau J.A., said -
"....the learned trial judge, in
my view, was at no fault when she did not concern herself with the question of
the Certificate of
Purchase No.0039. In any case at the trial of the
counter-claim, it was evident that the Certificate authorising repossession
issued
to the respondent ... had been Registered and the certificate of purchase
No.0039 had been cancelled". Evidently both courts below were alive to
the fact that the appellant was registered as proprietor of the suit property
prior to the
trial of the counter-claim. However, neither court discussed the
subsequent change in the registration. The circumstances, which
led the
Registrar of Tides, six years down the road, to be convinced to change the
status quo, are not disclosed in the record.
For that reason, I will not
express myself conclusively on the matter, but I have to express my doubt about
the propriety of the
decision to so act, and thereby pre-empt the court's
decision in a dispute pending resolution by court. Be that as it may, I must
stress that certificates issued under the Act do not confer ownership as
contended by respondent's counsel. To my mind their effect
is no more than that
of deeds of transfer or assignment under the RTA. That is the clear implication
of Sections 6(a) and 8(3) of
the Act. In order to provide "sufficient
authority" for the Registrar to effect transfer of tide, therefore, they
must be competently issued.
Three inter-related sub-issues arise from the submissions of counsel on both
sides, in this regard, namely: -
| • | whether, as a matter of
fact, the Minister revoked or, cancelled the purchase
certificate; |
| • | whether, as a matter of
law, the Minister had power to revoke, cancel or annul the purchase
certificate; |
| • | whether property disposed
of under section 8 can subsequendy be subject of repossession under section 5 of
the Act. |
The available evidence does not show that
the Minister expressly revoked or cancelled the purchase certificate. The
evidence related
to that question is (a) the issuance of the repossession
certificate by the Minister to the respondent, (b) the communication by
the
Custodian Board to the appellant, as occupier of the suit property, but without
any reference to the purchase certificate, that
a repossession certificate had
been issued to the respondent, and (c) the statement by the Minister in a letter
he wrote to the Commissioner
of Land Registration on 21 Oct 93, that the
purchase certificate was nullified. In the letter, the Minister, after
summarising the
earlier history of ownership of the suit property, wrote
-
"..Ibrahim Minawa sold the property to Mohan Musisi Kiwanuka who was
registered on 19th October, 1979. Mr. Kiwanuka's purchase was
nullified by the provisions of the (Act). The property was duly repossessed on
16th September, 1993 by the registered proprietor Karam Chand. The
certificate No 0039 issued to Mr Mohan Musis Kiwanuka was therefore
nullified
since the sale of the property was in error. You can therefore go ahead and
register Karam Chand as the rightful owner
of the property." (emphasis
is added).
I cannot conclude from this evidence, that the Minister expressly
revoked or cancelled the purchase certificate. The issuance of the
repossession
certificate per se is equivocal, as it could have been done in
ignorance or disregard of the purchase certificate. This tends to gain weight
from the
fact that in its communication to the appellant, the Custodian Board
made no mention of the purchase certificate, let alone its revocation
or
cancellation. Secondly, the Minister's statement in the letter, that the
purchase certificate was "therefore nullified", is clearly a
deduction from the issuance of the repossession certificate. It is not an
assertion that the Minister consciously annulled
the purchase certificate and
then authorised the repossession. Significantly, the statement was made
post facto, as an argument to urge the Commissioner of Land
Registration to register the respondent. I would therefore hold that it was not
shown
that as a matter of fact the Minister revoked the purchase certificate. I
will consider the other two sub-issues together.
In the courts below, as well as in this Court, counsel for the appellant
relied on Ravji Meghji Patel & 2 others vs Attorney General &
another. Civil Appeal No. 16/99 (C.A.) (unreported), as authority for
his submission that the Minister did not have power to revoke or otherwise
to
annul a certificate issued by him under the Act. The facts of that case are
virtually the same as those of the instant case.
In 1982, A, the
2nd respondent, purchased expropriated property at a public auction.
That purchase was nullified when the Act came into force in 1983.
On 15 Nov.
'92, the Minister issued a certificate of purchase to A, under section 8 of the
Act. Subsequently, BCD, as former owners of the said expropriated
property, applied for repossession. The Custodian Board informed them that the
property
had been sold and was not available for repossession. They appealed to
the Minister protesting against the sale. Later, they filed
the suit in the High
Court against the Attorney General and A praying for, inter alia,
declarations that the sale to A in 1992 was null and void for
non-compliance with statutory sale procedure, and that the certificate
of
purchase was issued to him illegally. At the hearing, the defendants raised a
number of preliminary objections to the plaint.
The court upheld the
objections and dismissed the suit. On appeal, the Court of Appeal held that the
trial was defective owing
to contradictory decisions by the trial court
"in the same case and on the same points". It ordered a retrial.
In the lead judgment, with which other members of the court concurred, Berko
J.A., had this to say about the
sale of the property, and the certificate of
purchase —
"It is plain ...that the Minister had dealt with the property by the
issuance of a certificate of purchase in favour of the second
respondent.
Whether the Minister followed the statutory procedure and regulations laid down
under the 1982 Act is beside the point.
The 1982 Act itself contains provisions
for resolving such issues. What is clear, however, is that the Minister has no
power under
the 1982 Act to cancel a certificate of purchase once he had issued
it. His decision can only be challenged in the manner provided
by 1982 Act.
Therefore the appeal to the Minister as contained in their lawyers letter was
misconceived."
Both courts below and the respondent's counsel in this appeal attempt to
distinguish that case from the instant one. I do not share
that view. The two
cases are not distinguishable. It would have been sufficient for the courts to
say that the observations of Berko
J.A., are not binding since they were made
obiter. Nevertheless, in my view, they are a correct statement of
the law. I have already stated and explained my similar view, that failure
in
the instant case to comply with the statutory sale procedure, did not vitiate
the disposal of the suit property to the appellant,
as what was done was within
the competence of the Minister. Secondly, I agree with Berko, J.A., that the
Minister has no power to
cancel a certificate issued under the Act. In
providing, in section 14 of the Act, that a person aggrieved by a decision made
by
the Minister under the Act may appeal to the High Court, Parliament did not
expressly reserve in the Minister, any power to review
such a decision upon
request by an aggrieved person. It only directed that such person should appeal
to the High Court. I am also
unable to construe from the Act, that the Minister
retained any implied power to revoke his decision on the ground that it was made
in error. In my view, to do so would perpetuate the very uncertainties about
ownership of the expropriated properties, which the
Act was, intended to
eliminate. It would enable the Minister at anytime, ad infinitum
to reverse earlier decisions, and cancel or annul certificates issued
under sections 4,5 or 8 of the Act, merely because of change
of mind or opinion,
or because of other whims or considerations. If the legislature had intended to
retain in the Minister concurrently
with the High Court, any power to review his
decisions, it would have done so expressly. The only intention I read from the
provisions
of the Act is to empower the Minister to decide and dispose of an
expropriated property once, and to let any grievance arising from
the Minister's
decision to be resolved by the High Court.
In the instant case, the purchase
certificate was issued by a Deputy Minister of Finance, and subsequently, the
repossession certificate
was issued by the successor, a Minister of State of
Finance, who asserted after the event, that the sale ordered by the predecessor
was done in error. I have already given, and need not repeat here, the reasons
for my conclusion that the sale was lawful and not
made in error. However, even
assuming for a moment, that the Minister had material, showing that the sale was
in error, that material
should have been availed to the court, which had the
jurisdiction to determine the validity of the purchase certificate in the trial
of Civil Suit No 693/92. In issuing the repossession certificate in respect of
the suit property, the Minister purported to exercise
power he no longer had. It
follows that his act had no legal effect. It did not revoke or otherwise annul
the appellant's purchase
certificate.
From the foregoing, my conclusion is that at all material times, the
appellant was lawfully in possession of the suit property. I
would therefore
hold that he was not liable to give vacant possession, or to pay mesne
profits, to the respondent in respect of the suit property. In my view,
grounds 1 and 5 ought to succeed, and that would dispose of the appeal,
since
grounds 2 and 3 are minor and would not affect the result substantially. Ground
4 was abandoned.
In the result, I would allow the appeal and order that the judgments and
orders of the courts below be set aside, and be substituted
by an order
dismissing the respondent's counter-claim, with costs to the appellant in this
Court and in the courts below.
JUDGMENT OF ODER.JSC.
I have had the benefit of reading in draft the judgment of Mulenga, J.S.C.
and I agree with him that the appeal should succeed. I
also agree with the
orders proposed by him. As Tsekooko, JSC, Karokora, JSC, and Kato, JSC also
agreed, the orders shall be as proposed
by Mulenga , JSC.
JUDGMENT OF TSEKOOKO, J.S.C.
I have had the advantage of reading in draft the judgment which has been
delivered by my learned brother, the Hon. Justice J.N.Mulenga,
J.S.C and agree
with his reasoning in the matter and I also concur in the orders he has
proposed.
JUDGMENT OF KAROKORA, JSC
I have had the advantage of reading in draft the judgment prepared by
Mulenga, JSC and 1 agree with him, that the appeal should succeed.
1 also agree
with the orders he has proposed.
JUDGMENT OF KATO, JSC.
I have had the benefit of reading draft judgment of my learned brother
Mulenga, JSC. I agree with it and his proposed orders. I would also allow
the appeal with costs to the appellant.
Dated at Mengo this 16th of July 2003.
