Simba Properties Investment Co. Ltd and Others v Vantage Mezzanine Fund II Partnership (Civil Application No. 0023 of 2025) [2025] UGSC 46 (2 October 2025)

2 3 4 5 6 THE REPUBLIC OF UGANDA IN THE SUPREME COURT OF UGANDA AT KAMPALA CIVIL APPLICATION NO. OO23 OF 2025 1. SIMBA PROPERTIES INVESTMENT CO. LTD . SIMBATELECOM LTD . ELGON TERRACE HOTEL LTD . LINDA PROPERTIES LTD . PATRICK BITATURE . CAROL BITATURE APPLICANTS VANTAGE MEZZANIN E FUND II PARTNERSHIP: : : : : : : : :RESPONDENT CORAM: HON. LADYJUSTICE ELIZABETH MUSOKE,JSC RULING OF THE COURT The applicants filed this application seeking an interim order staying the execution of the decision in Court of Appeal Civil Application No. 305 of 2025 pending the hearing and determination, by thls Court, of their Civil Application No. 22 of 2023 seeking a substantive stay of the highlighted decision of the Court of Appeal. This ruling has, wlth the consent of all the pafties and their respective counsel, been made by consideration of the respective parties' pleadings and their respective counsel's written submissions filed in this Court in accordance with timelines given by the Registrar of the Supreme Court, without holding an open court hearing. Background By agreement dated 11th December, 2014, the lenders indicated therein as Vantage Mezzanine Fund II Partnership, whose general partner was stated as Vantage Mezzanine Fund II Proprietary Ltd and whose advisor was stated as Vantage Capital Fund Managers (Pty) Ltd gave a loan of US Dollars 1 VERSUS 10,000,000 to the borrower indicated in the agreement as Simba Properties Investment Co. Ltd (the 1s applicant). The agreement sets out the terms for the loan including the designation of the 2nd to 6th applicants as guarantors in respect of the loan, the making of mortgages pledging certain property belonging to the 2nd to 4th applicants as security for the loan, the pledging of equity in the 2nd to 4th applicants as further security for the loan, as well as the loan repayment terms. The lenders subsequently alleged default by the 1$ applicant of the loan repayment terms under the agreement and, after obtaining leave of the High Court of Uganda (Commercial Division), instituted arbitration proceedings under the auspices of the London International Chamber of Commerce. The arbitration proceedings commenced on 16th December, 2021 before an arbitrator who, after their completion, made a final arbitral award dated 31s )u|y,2023 and an addendum to the final arbitral award dated 9th August, 2023. The lenders subsequently instituted proceedings before the High Court of Uganda (Commercial Division) seeking orders for recognition and enforcement of the final arbitral award and its addendum. While the hearing of these proceedings was still pending, the lenders instituted Miscellaneous Application No, 2484 of 2023 seeking interim measures to restrain the borrower and the guarantors from making changes to the ownership of the mortgaged property and the shareholding of the 2nd to 4th applicants so as to protect their right to the successful execution of the final arbitral award and its addendum. In a rullng dated 1lh November, 2023, Ocaya, J granted the interim orders sought in Miscellaneous Application No. 2484 of 2023 and made an order restraining the borrower and the guarantors from dealing with the moftgaged property and shareholding in a manner prejudicial to the lenders' interests pending the hearing and determination of the application for recognition of the relevant arbitral award and its addendum. On 14th December, 2023, the borrower and the guarantors (the 1s to 6th applicants herein) filed a notice of appeal in the High Court of Uganda 2 (Commercial Division) disclosing their intention to appeal to the Court of Appeal against the decision by Ocaya, J. The applicants subsequently filed Civil Appllcation 1295 of 2023 in the Court of Appeal seeking for leave to appeal against the decision by Ocaya, J. On 20th June, 2025, the lenders filed Civil Application No. 305 of 2025 in the Court of Appeal seeking for an order striking out the applicant's notice of appeal against Ocaya, J's decision on two grounds: first, that no appeal was allowed against the High Court decision under the Arbitration and Conciliation AcU and second, that the notice of appeal was filed after the expiration of the prescribed time. The Court of Appeal (Egonda-Ntende, Luswata and Nambayo, JJA) In a decision dated 22nd August, 2025 allowed Civil Application No. 305 of 2025 and struck out the applicant's notice of appeal on grounds that the intended appeal was not allowed under the Arbitration and Conciliation Act. On 28th August, 2025, the applicants filed a notice of appeal in the Court of Appeal communicating their intention to appeal to this Court against the decision in Civil Application No. 305 of 2025, and also filed a letter to the Registrar-Court of Appeal, requesting for a copy of the typed proceedings and ruling in Civil Application No. 305 of 2025. The applicants subsequently filed, in this Court, Civil Application No. 21 of 2025 for leave to appeal against the decision in Couft of Appeal Civil Application No. 305 of 2025. The applicants also filed, in this Court, Civil Application No. 22 of 2025 seeking a substantive stay of executlon and the present application seeking an interim order of stay of execution of the same decision Court of Appeal Civil Application No. 305 of 2025. In the last two mentioned applications, the applicants cite one respondent, Vantage Mezzanine Fund II Partnership leaving out Vantage Mezzanine Fund II Proprietary Ltd, the second applicant in Court of Appeal Civil Application No, 305 of 2025. The grounds In support of the applicant's application are set out in the application and expatiated in the affidavit of Mr. Laurel Ababuza Baguma in 3 support of the appllcation. The respondent opposed the appllcation on grounds set out in Mr. Moses Muziki's affidavit in reply. Representation The law firm Moogi Brian & Co. Advocates represents the applicants while the law firm Kirunda & Co. Advocates represents the respondent. Arguments The respective counsel filed written submissions containing the legal arguments of the respective parties in this applicatlon. Consideration of the Application I have carefully studied the respective parties'pleadings and also considered the respective counsel's submissions and the law and authorities cited therein, This is an application for an interim order to stay the execution of the decision in Court of Appeal Clvil Application No. 305 of 2025. It is well- established that this Court has powers, under Rule 2 (2) of the Rules of the Supreme Court to make such an interim order to stay the status quo until the hearing and determination of the substantive application for stay of execution which, if granted, stays the status quo until the determination of the appeal against the decision sought to be stayed. It is also well established that the conditions for granting an interim order of stay of execution are as follows: first, that a competent notice of appeal against the decision sought to be stayed has been filed in this court; second, that an application for substantive stay of execution of the relevant decision has been filed in this couft, and third, that there is an imminent threat of execution of the decision sought to be stayed pending the hearing and determination of the application for substantlve stay of execution. See: Hwang Sung Industries Ltd vs. Tajdin Hussein and 2 Others, Supreme Court Civil Application No. 19 of 20O8 (unreported); and Lukwago Erias, Lord Mayor of Kampala Capital City Authority vs. The Attorney General and Another, Supreme Court Civil Application No. O6 of 2OL4 (unreported). My discussion on the relevant conditions is set out below. 4 5 A competent notice of appeal There is, on record, a notice of appeal filed by the applicants in this Court on 28th August, 2025 and served on the law firm representing the respondent, Kirunda and Co. Advocates, on the same day. In the notice of appeal, the applicants disclose their intention to appeal to this Court against the decision in Couft of Appeal Civil Application No. 305 of 2025. In their submissions, the counsel for the applicants maintain that this notice of appeal is a competent notice of appeal. Counsel for the respondent, on the other hand, submit that notice of appeal is defective because it was drafted in a manner that contravenes Rule 72 (5) and Form D in the First Schedule of the Rules of this Court, insofar as the heading of the notice of appeal does not mirror the heading of the decision belng appealed as it omits one of the applicants in Court of Appeal Civil Application No. 305 of 2025. In my view, the main purpose of a notice of appeal is to give notice of a party's intention to file an appeal in this Court and sufficient notice is given if the notice of appeal indicates the decision sought to be appealed. The notice of appeal in this case indicates that the applicants are interested in appealing the decision in Court of Appeal Civil Application No. 305 of 2025 and is therefore sufficient for the relevant purpose. There may as well be some formalistic defects noticeable in the notice of appeal, including those pointed out by the counsel for the respondent but these defects do not, in my view, detract from the fact that the notice of appeal specifies the decision being appealed. Counsel for the respondent has also submitted that the notice of appeal is incompetent on grounds that it relates to an appeal that is not permitted under the law. I do observe, however, that the issue on competence of the appeal in the Court of Appeal and the intended appeal to this Court is the main question for determination in the application for leave to file the intended appeal which is pending before this Court. Therefore, I do not find it proper to consider that question in this application as doing so would have the effect of preempting the consideration of that point by the panel which will decide the application for leave to appeal. A substantive application for stay of execution has been filed The applicants adduced evidence, which is unchallenged by the respondent, of having filed Supreme Court Civil Application No. 22 of 2025 seeking a substantive stay of execution of the decision in Court of Appeal Civil Appeal No. 305 of 2025. This condition is therefore satisfied. Imminent threat of execution before the hearing and determination of the application for substantive stay of execution It should, in my view, be possible to draw a reasonable inference that every successful pafi has an interest in ensuring the immediate execution of the decree arising from the case in which he/she has been successful. I, therefore, find incredible, the suggestion set out in paragraph 21 of Mr. Moses Muziki's affidavit in reply, that the lenders do not have any intention to imminently execute the decree arising from Court of Appeal Civil Applicatlon No. 305 of 2025. It is further argued in the respondent's submlssions that it could only have been reasonable to speak of an imminent threat of execution, in this case, if the lenders had taken out separate proceedings for execution of the relevant arbitral award and addendum or if there was evidence that the High Court had commenced hearing of the proceedings for recognition of the relevant arbitral award and addendum, which is not the case. However, in my view, the fact the respondent has opposed this application does support a reasonable inference that the lenders are interested in execution of the relevant decree in the near future. I, therefore, find on a balance of probabillties that there is a likelihood of imminent execution of the decree arising from the decision in Couft of Appeal Civil Application No. 305 of 2025, and the third condition is satisfied. 6 In light of these reasons, I would find that the applicants have satisfied the necessary conditlons for grant of an interim order of stay of execution pending the hearing and determination of their substantive application for stay of execution. However, before setting out the final orders, I wish to comment on some of the points of law raised in the submlssions of counsel for the respondent. The fundamental point raised by counsel for the respondent is that this Court lacks jurisdiction over the appllcants' intended appeal. I did observe, however, that the nature of the arguments of counsel for the respondent in regard to thls fundamental point covers points that are best left to be argued in the application for leave to appeal or the intended main appeal if the necessary leave is granted. The authorities cited by counsel for the respondent, such as this Court's decisions in Faustine Ntambara vs. Benon Sebujisho, Civil Appeal No. 8 of 2O2L (unrepofted); and in Babcon Uganda Ltd vs. Mbale Resoft Hotel Ltd, Civil Appeal No. 6 of 2016 (unrepofted) are based on declsions taken in the main appeal and not in an application for an interim order of stay of execution. I reiterate that the main purpose of an interim order is preservation of the status quo to avoid rendering, nugatory, the determination of the substantive application for stay of execution and the appeal itself. In addition, it should be noted that, under Section 8 (1) of the Judicature Act, Cap. 16, the powers of a single justice of this court are restricted to determination of interlocutory matters. In their submisslons, the counsel for the respondent are asking me to determine the competence of the intended appeal against the decision in Court of Appeal Civil Application but am doubtful that determining the competence of an appeal with the potential consequence of resolving the appeal altogether, is an interlocutory matter within the meaning of Section 8 (1) of the ludicature Act, Cap. 16. Another point that was raised in the submissions of the counsel for the respondent relates to whether this application ought, in accordance with Rule 41 (1) of the Rules of this Couft, to have been lodged in the Court of Appeal first. Rule 41 reads as follows: 7 "41. Order of applications to the court and to Court of Appeal. (1) Where an application may be made either to the court or to the Court of Appeal, it shall be made to the Court of Appeal first, (2) Notwithstanding subrule (1) of this rule, in any civil or criminal matter, the cou* may, in its discretion, on application or of its own motaon, give leave to appeal and make any consequential order to extend the time for the doing of any act, as the justice of the case requires, or entertain an application under rule 6(2Xb) of these Rules to safeguard the right of appeal, notwithstanding the fact that no application has first been made to the Court of Appeal." In some previous decisions, this Court has interpreted Rule 41 (1) as establishing a requirement that an application for stay of execution should first be lodged in the Court that made the decision sought to be stayed. See: For example, Lawrence Musitwa Kyazze vs. Eunice Busingye, Civil Application No. 18 of 199O (unreported) and the cases that have followed it, such as, Osman Kassim Ramathan vs. Century Bottling Company, Civil Application No. 34 of 2Ol9 (unrepofted). However, in other previous decisions, this Court has, despite Rule 41 (1), proceeded to entertain and determine applications for stay of executlon despite no prior application having been determined by the lower Court. See: For example, SWT Tanners and 15 Others vs. Commissioner General, Uganda Revenue Authority, Civil Application No. 27 ol 2O22 (unrepofted) and Hwan Sung Industries Ltd vs. Tajdin Hussein and 2 Others, Civil Application No. 19 of 20O8 (unreported). In my opinion, the interests of judicial economy require that where an application for stay of execution is filed in thls court and is given a hearing date, this couft should proceed to determine the application on its merits. After all, this Court and the Court of Appeal apply the same prlnciples when determining applications for stay of execution. Furthermore, it will be noted that an intending appellant who has his/her application for stay of execution dismissed by the Court of Appeal has a right, under Rule a1 (1) of the Rules of this Court, to bring a fresh application for stay of execution before this 8 Court leading to a rlsk of unnecessary duplication where this Court and the Court of Appeal apply their efforts to determining the same application. I therefore find little practical justification for insisting on sending an application for stay of execution to the Court of Appeal instead of determining the same conclusively in this Couft in circumstances where the application has been heard by this Court. In conclusion, for all the above reasons, I would allow this application and make the following orders: a) An interim order, staying the execution of the decision in Court of Appeal Civil Application No. 305 of 2025 pending the hearing and determlnation of the applicants'appllcation for substantive stay of execution, is granted. b) The costs of the appllcation shall abide the outcome of the substantive application for stay of execution. It is so ordered. /0 fh day of.. 4- 2025. Elizabeth Musoke Justice of the Supreme Court Delivered by the Registrar this...J..01h. day of ,hrg" Registrar Supreme Court 202s. 9 Signed at Kampala this THE REPUBLIC OF UGANDA IN THE SUPREME COURT OF UGANDA AT KAMPAIA CIVIL APPLICATION NO. OO23 OF 2025 1. SIMBA PROPERTIES INVESTMENT CO. LTD 2. SIMBA TELECOM LTD 3. ELGON TERRACE HOTEL LTD 4. LINDA PROPERTIES LTD 5. PATRICK BITATURE 6. CAROL BITATURE: : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : :APPLICANTS VERSUS VANTAGE MEZZANIN E FUN D II PARTNERSHIP: : : : : : : : : RESPONDENT CORRECTION OF AN ERROR IN THE RULING OF THE COURT In accordance with the powers vested in the Court under Rule 35 (1) of the Judicature (Supreme Court Rules) Directions S.I 16-11, permitting the correction of any error arising in its decisions, the Court moves to correct order (a) at page 9 of its ruling, to read as follows: "a) An interim order, staying the execution of the decision in Couft of Appeal Civil Application No. 3O5 of 2025 pending the hearlng and determination of the applicants'application for substantive stay of execution, is granted." The Registrar shall supply the parties with a copy of the ruling with the above correction. day of.... 2025. Elizabeth Musoke lustice of the Supreme Court It is so ordered. Dated at Kampala this. IOTK Our Ref;. THE JUDICIARY THE OFFICE OF THE REGISTRAR SUPREME COURT P.O BOX 6679 I(AMPALA il 7 Our ref : SUP-CV-CL-0017 -2024 Your ref: To: 1. I\{s KIRUNDA &Co. ADVOCATES 2. M/" MOOGI BRIAN & Co. ADVOCATES Reference is made to the letter by Ms Moogi & Co. Advocates dated 8th October 2025 requesting for rectification of the Ruling in the above Civil Application. This is to notify you that the error in the Ruling in the above case has been corrected and the corrected Ruling has been uploaded onto the ECCMIS for your consumption. Yours faithfully, AYEB MWEBAZE E REGISTRAR. SUPREME COURT 10ft October, 2025 CORRECTION OF ERROR lN THE RULING lN CIVIL APPLICATION No. 0023 OF 202s: SIMBA PROPERTIES CO. LTD & 5 OTHERS VERSUS VANTAGE MEZZAININE FUND II PARTNERSHIP