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Kibibu Engineering Co. Ltd v Kolin Insaat Turizim Sanayi Ticaret (Miscellaneous Application No. 330 of 2016) [2016] UGCommC 80 (20 May 2016)
- Citation
- [2016] UGCommC 80
- Status
- Judgment
- Jurisdiction
- Uganda
- Court
- Commercial Court of Uganda
- Posture
- Miscellaneous Application / Ruling on Application for Security for Payment Pending Arbitration Award Enforcement
- Case number
- Miscellaneous Application No. 330 of 2016
- Language
- English
More details
- Court
- Commercial Court of Uganda
- Posture
- Miscellaneous Application / Ruling on Application for Security for Payment Pending Arbitration Award Enforcement
- Case number
- Miscellaneous Application No. 330 of 2016
- Language
- English
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The court found that the respondent, despite being a foreign company, demonstrated sufficient assets within Uganda, including vehicles and construction equipment registered in its name. The court was persuaded that the respondent had no intention of leaving the jurisdiction and possessed the capacity to meet any obligations arising from the arbitral award. Therefore, it was not proper to order the respondent to provide security for payment, and the application was dismissed.
Court disposition
application dismissed
Orders
- The application for security for payment is dismissed.
- No order as to costs.
02
Material facts
Parties
Kibibu Engineering Co. Ltd
ApplicantKolin Insaat Turizim Sanayi Ticaret
Respondent03
Procedural history
Posture
Miscellaneous Application / Ruling on Application for Security for Payment Pending Arbitration Award Enforcement
04
Questions and positions
Legal issues
- 01
Whether the respondent, as a foreign company, should be ordered to provide security for payment of the arbitral award and costs.
- 02
Whether the respondent has sufficient assets within the jurisdiction to satisfy the decree.
Party arguments
- Applicant
- The applicant argued that the respondent is a foreign company with no known assets in Uganda, making it difficult to recover the arbitral award and costs if the respondent fails to pay. The applicant sought an order for the respondent to provide security for the payment of the decree and likely costs.
- Respondent
- The respondent contended that it has the capacity to satisfy the decree as it owns sufficient assets in Uganda, including debts, vehicles, and construction equipment. Certified copies of vehicle and plant registrations in the respondent's name were provided to the court.
05
Court’s reasoning
Legal principles
- 01
Section 34(5) of the Arbitration and Conciliation Act
The court may require a party to provide appropriate security if it considers it proper.
- 02
Judicial practice under Ugandan law
Courts exercise discretion to order security where the party resides outside the jurisdiction and has no substantial property within the jurisdiction.
06
Ratio, limits and disposition
Ratio decidendi
The court found that the respondent, despite being a foreign company, demonstrated sufficient assets within Uganda, including vehicles and construction equipment registered in its name. The court was persuaded that the respondent had no intention of leaving the jurisdiction and possessed the capacity to meet any obligations arising from the arbitral award. Therefore, it was not proper to order the respondent to provide security for payment, and the application was dismissed.
Court disposition
application dismissed
- The application for security for payment is dismissed.
- No order as to costs.
Source and reliance status
Commercial Court of Uganda
This page organises the available record for research. Confirm quotations, current status, and subsequent treatment against the official source before relying on the case.
Judgment reading view
Judgment text
The complete available source text.
Commercial Court of Uganda
Judgment
THE REPUBLIC OF UGANDA
IN THE HIGH COURT OF UGANDA AT KAMPALA
MISCELLANEOUS APPLICATION No. 330 OF 2016
*[Arising out of Misc. cause No. 4 of 2016]*
*[ARISING OUT OF CADER/ARBITRATION No. 16 OF 2016]*
*[ARISING OUT OF H. C. C. C No. 172 OF 2013]*
KIBIBU ENGINEERING CO. LTD ::::::::::::::::::::::::::::::::::::::::::::::::: APPLICANT
VERSUS
KOLIN INSAAT TURIZIM SANAYI TICARET ::::::::::::::::::::::::::::::: RESPONDENT
BEFORE: HON. MR. JUSTICE B. KAINAMURA
RULING
This is an application by Ms. Kabibu Engineering Co. Ltd under S. 34 (5) of the Arbitration and Conciliation Act for the applicant. In Misc Cause No. 4 of 2016 M/s Kolen Insaat Turizm Sanayi ve Ticaret to provide security for the payment of the decree in CADER/Arbitration No. 16 of 2016 and costs likely in opposing Misc Cause No. 4 of 2016.
It is contended by the applicant in this application that the respondent is a foreign company with no known assets is Uganda to which the applicant can have resort to, to recover the decretal award and costs.
In reply the respondent maintains it has capacity to satisfy the decree that has been issued against it as it owns sufficient assets in Uganda in form of debt, movable assets like vehicles and construction equipment.
S. 34(5) of the Arbitration and Conciliation Act provides that if the court considers it proper then it can require a party to provide appropriate security.
In practice courts have exercised the above discretion where the party against whom the application is made ordinary resides outside the jurisdiction and has no substantial property within the jurisdiction. In the instant case Counsel for the respondent supplied to court certified copies of a sizeable number of vehicles and plant registered in the names of the respondent.
In the premis I am persuaded that the respondent has no intention of leaving jurisdiction and has sufficient capacity to meet the obligations that may arise if the application to set aside the award was to fail.
Accordingly this application does not succeed and is dismissed with no order as to costs.
B. Kainamura
Judge
20.05.2016
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