Kiggundu v Black Market Records (U) Limited & 2 Others (Miscellaneous Application 399 of 2023) [2023] UGCommC 199 (13 October 2023)

THE REPUBLIC OF UGANDA

IN THE HIGH COURT OF UGANDA AT KAMPALA (COMMERCIAL DIVISION)

MISCELLANEOUS APPLICATION NO. 0399 OF 2023 ARISING FROM CIVIL SUIT NO. 1025 OF 2022

KIGGUNDU BRUNO (A. K. A. BRUNO K.) ::::::::::::::::::::::::::::::::::: APPLICANT

VERSUS

- 1. BLACK MARKET RECORDS (U) LTD - 2. CEDRIC SINGLETON - 3. KISAME SHADRACK ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: RESPONDENTS

(Before: Hon. Lady Justice Patricia Mutesi)

RULING

Introduction

This application is brought by chamber summons under Section 33 of the Judicature Act Cap 33, Section 98 of Civil Procedure Act and Order 6 rules 19 and 31 of the Civil Procedure Rules seeking leave of court to amend the plaint in Civil Suit No. 1025 of 2022 ("the main suit), by substituting Black Market Records (U) Ltd with Black Market Records Entertainment - SMC Limited, and to add some material facts which had not been pleaded.

Briefly, the applicant asserts that his former lawyer wrongly sued the 1st respondent as a defendant in the main suit instead of Black Market Records Entertainment SMC Ltd, and failed to plead material facts relating to fraud, yet all relevant documents had been availed to him. The 1st respondent did not oppose the application. In their affidavits in reply, the 2 nd and 3rd respondents who are directors / shareholders in Black Market Records Entertainment SMC Ltd, averred that there is no evidence linking the said company to the Applicant's artistic works and that the proposed amendments are, therefore, unjustified. In his affidavit in rejoinder, the applicant maintained that he has a valid claim against the said company.

The brief background of this dispute, as can be gathered from the record, is that the applicant is a Ugandan-based singer who signed a 1-year exclusive recording artist agreement with Black Market Records LLC, a US-based company, on 12th May 2020. He asserts that the said company was represented in the transaction by the 2 nd and 3rd respondents. Under the agreement, Black Market Records LLC was to finance the recording and production of the applicant's songs in exchange for exclusive copyright in the songs. The applicant asserts that he recorded only one song for the entire duration of the agreement and that he elected not to renew the agreement after its expiry in May 2021. On 24th November 2022, the Applicant brought the main suit to this Court claiming that the respondents had made false copyright complaints against him to Youtube, a video sharing platform, which led the platform to strike down his songs and disable his channel. The main suit is yet to be disposed of.

At the hearing, the Applicant was represented by Mr. Augustine Idot and Mr. Ivan Bwowe, while the Respondent was represented by Mr. Mutayomba Geoffrey. The parties filed brief submissions which I have considered.

Determination

Issue 1: Whether this application should be allowed.

Courts have the discretion to allow a party to a case to alter his or her pleadings in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties (see Order 6 rule 19 of the Civil Procedure Rules). In this case, the applicant seeks leave primarily to make two amendments, that is, substitution of the 1st respondent with Black Market Records Entertainment SMC Ltd and the introduction of facts relating to fraud and other illegalities.

The 2nd and 3rd respondents assert that there was no evidence adduced by the Applicant linking the 1st respondent company to the Applicant's music, since he contracted with Black Market Records Entertainment LLC. However at this stage it is not necessary to prove the facts sought to be pleaded, as these are matters for the trial proper. In any case this argument is not new. On 7th March 2023, the said company filed Misc. Application No. 0494 of 2023 seeking an order striking out the main suit. It argued that the suit disclosed no cause of action against it since it had never contracted with the applicant. I dismissed that application and I do not find any reason to depart from my reasoning then. The main suit is not based on breach of contract. It is based on copyright infringement which, in principle, can occur even without a prior contractual relationship between the rights holder and the infringing party.

As I noted in Misc. Application No. 0494 of 2023, when the applicant's former lawyers retrieved summons to file a defence from the Court, they served the same upon Black Market Records Entertainment SMC Ltd, albeit without noticing that the latter had not been named as a defendant in the main suit. Additionally, while the 1st respondent herein has never filed a defence to the main suit, Black Market Records Entertainment SMC Ltd has already filed a defence to the main suit in which it severally identifies itself as the *"1st Defendant"*. All this suggests that Black Market Records Entertainment SMC Ltd was the actual intended defendant, along with the 2nd and 3rd respondents, in the main suit and that the inclusion of the 1st respondent in these proceedings was an inadvertent error of pleading on the part of the applicant's former counsel which should not be visited on the applicant.

The second arm of intended amendments relates to the alleged material facts on fraud and other illegalities. The applicant asserts that upon further investigation, his new lawyers have now confirmed that Black Market Records LLC, which the 2nd and 3rd Respondents claimed to represent in the suit agreement, was deregistered in 2013 and was not a legal entity on 12th May 2020 when the exclusive recording agreement was signed. That they have also discovered that the 2nd and 3rd respondents, through their agents and accomplices, deceived Youtube that they had a valid court order from the High Court of Kenya at Nairobi giving them exclusive ownership over the applicant's songs, yet the Kenyan judiciary has formally denied the existence of the proceedings in which the order is alleged to have been issued.

Counsel for the respondents has argued that the above facts, if pleaded, will introduce fraud as a new and distinct cause of action in the plaint yet fraud was not pleaded earlier. Para. 6 of the plaint states in relevant part:

*"6. The Plaintiff's claim against the defendant arises out of copyright infringement, unjustified intrusion and exploitation and unlawful commercial appropriation of the Plaintiff's songs for the commercial and general benefit of the defendant in its undertakings and conversion…"*

On the other hand, para. 4 of the draft amended plaint states in relevant part:

*"4. The Plaintiff's claim against the Defendants, jointly and severally, is for copyright infringement, unlawful and fraudulent commercial exploitation of the Plaintiff's songs…"* Underlining for emphasis.

It is evident that while fraud was not earlier pleaded, the applicant now seeks to introduce it as a build up to his copyright infringement claim. The law on amendments which introduce new causes of action is well settled. In Mulowooza Brothers Ltd v N. Shah & Co. Ltd, SCCA No. 26 of 2010, the Supreme Court affirmed that amendments to pleadings sought before the hearing should be freely allowed, if they can be made without injustice to the other side. It also clarified that the court will not refuse an amendment simply because it introduces a new case.

Furthermore, in Semanda Godfrey & Anor v Lake Wamala Farm Ltd & 2 Ors, HCMA No. 001 of 2021, the Learned Hon. Justice Dr. Flavian Zeija, had this to say:

*"… The truest test for allowing or disallowing amendments of pleading has always been whether the intended amendment would be prejudicial to the other party's case. However, a great string of authorities postulate that even where there is a likely prejudice, an amendment will often be favoured over the prejudice as long as the prejudice can sufficiently be compensated for in terms of costs. It, therefore, goes without saying that the burden lies heavily on the party opposing the amendment to demonstrate to court's satisfaction that the amendment will occasion such an injustice that cannot be sufficiently compensated for by costs …"* Emphasis mine.

Therefore, in principle, a proposed amendment cannot be rejected merely because it introduces a new claim. A party opposing the amendment must demonstrate that the introduction of that new claim will prejudice him or her and that the prejudice cannot be put right by any form of pecuniary recompense. In this case, the information that the applicant intends to introduce is critical and will enable the Court to exhaustively investigate all the matters in controversy. To ensure finality in litigation, courts should not handle cases in piecemeal. All necessary amendments to pleadings should be allowed so that the court can comprehensively deal with the actual issues in dispute between the parties.

In any case, it is trite law that where an amendment is not any different in quality from the cause of action earlier pleaded, it should be allowed (see Matagala Vincent v Uganda Revenue Authority, HCMA No. 25 of 2013). The fraud and illegality alleged in this application seem to have been committed in furtherance of the infringement of the applicant's copyright. Thus, even as new claims, the fraud and illegality remain intricately linked with the earlier copyright infringement claim and will not substantially alter the general character of the cause of action in plaint.

While the respondents are likely to suffer some prejudice in having to file an amended defence replying to the new claims, this prejudice can be adequately compensated by an award of damages and costs if the respondents succeed at the trial. Consequently the application succeeds and I make the following orders:

- i. The applicant shall file and serve its amended plaint, as proposed in the draft amended plaint, within 10 (ten) days from the date of this ruling. - ii. Costs of this application shall abide by the outcome of the main suit.

The parties are hereby directed to file a Joint Scheduling Memorandum and their respective trial bundles and witness statements by 15th December 2023.

….………………………….………………………

Patricia Mutesi JUDGE (13/10/23)