High Court Dismisses Suit for Lack of Locus Standi; Holds That a Struck-Off Company Cannot Maintain Proceedings and a Shareholder Cannot Exercise Rights on Behalf of a Non-Existent Company

FACTS

The dispute concerns land comprised in Busiro Block 459, Plots 1211, 1212 and 1213 at Katale ("the suit land"). The Applicant, Nakasi Dorcus, averred that she purchased the suit land from Hilltop Academy Limited (the 2nd Respondent), with the transaction documentation signed by Nawoova Betty (the 1st Respondent) and the late Kasasira Florence Lwanga in their capacities as directors of the company. Following the purchase, the Applicant processed and transferred the titles into her own names.

The 1st and 2nd Respondents subsequently instituted HCCS No. 0353 of 2025 against the Applicant, seeking declarations that she was a trespasser on the suit land, an order for vacant possession, and an eviction order.

The Applicant, Nakasi Dorcus, filed a preliminary application seeking the dismissal of HCCS No. 353 of 2025 on the grounds that the Plaintiffs lacked the legal capacity and locus standi to institute and maintain the suit.

The substantive suit had been filed by Nawoova Betty and Hilltop Academy Limited against the Applicant, seeking declarations that the Applicant was a trespasser on land comprised in Busiro Block 459 Plots 1211, 1212 and 1213 at Katale, together with orders for vacant possession and eviction.

The Applicant contended that she had purchased the suit land from Hilltop Academy Limited and that the transaction documents had been executed by the late Florence Kasasira Lwanga and Nawoova Betty as directors of the company. Following the transaction, titles were processed and transferred into her names.

The Applicant further asserted that the 1st Plaintiff, Nawoova Betty, had filed the suit in her personal capacity as a shareholder of Hilltop Academy Limited despite lacking authority to sue on behalf of the company. It was also alleged that no company resolution authorising commencement of the suit had been passed and that Hilltop Academy Limited had already been struck off the Register of Companies before the suit was filed.

In response, Nawoova Betty maintained that she was a 50% shareholder in the company and therefore competent to institute proceedings. She argued that the company had never authorised the subdivision and transfer of the suit land and that following the death of the other shareholder, Florence Kasasira Lwanga, she had commenced proceedings to regularise the company's affairs.

She further contended that the company had been reinstated through the Online Business Registration System (OBRS) and had therefore regained its legal status prior to filing the suit.

Ms Marion Tugumusirize, a Senior Registration Officer with the Uganda Registration Services Bureau (URSB), swore an affidavit on behalf of the 3rd Respondent (Commissioner Land Registration) stating that the 2nd Respondent had been incorporated in 1994 with two shareholders (Stanley Lwanga and Florence Kasasira), that Lwanga's shares were transferred to the 1st Respondent in 2014, that the company had no directors or secretary on record, and that it had been struck off the Register of Companies for failing to file annual returns for five consecutive years since 2013.

The Applicant, in her affidavit in rejoinder, acknowledged the facts deposed by the 3rd Respondent's officer and confirmed that the 3rd Respondent (Commissioner Land Registration) was also the 2nd Defendant in the main suit from which this Application arose.

Issues for Determination

1.       Whether the Application was competently before court.

2.       Whether the 3rd Respondent's affidavit was admissible evidence for purposes of the Application.

3.       Whether the 2nd Respondent could competently maintain the suit as Plaintiff in HCCS No. 0353 of 2025.

4.       Whether the 1st Respondent had locus standi to commence HCCS No. 0353 of 2025 and could competently maintain the action, either in her own name or in the name of the 2nd Respondent.

5.       What remedies were available to the parties.

LEGAL REPRESENTATION

Applicant

The Applicant was represented by Mr. Joseph Kyazze of M/s Magna Advocates.

Respondents

The Respondents were represented by Mr. Mudde John Bosco and Mr. Tendo Drummond of M/s JB Mudde Advocates.

SUBMISSIONS OF THE PARTIES

Applicant's Submissions

Counsel for the Applicant submitted that questions of locus standi, legal capacity and competence of a suit are proper preliminary points of law capable of disposing of a suit without going into its merits.

Counsel argued that Hilltop Academy Limited had ceased to exist as a legal entity after being struck off the Register of Companies and therefore lacked capacity to sue or maintain proceedings.

Relying on authorities including Sarick Construction v Child of Africa Ltd, Ndawula Ronald v Hiira Traders Ltd, and Crown Converters Ltd v Stanbic Bank (U) Ltd, Counsel submitted that a company struck off the register loses its corporate personality and cannot perform any legal functions until properly restored.

Counsel further submitted that the alleged restoration relied upon by the Respondents was unsupported by any order of the Registrar or Court and that mere updating of company data on the OBRS portal did not amount to restoration.

On locus standi, Counsel argued that a shareholder cannot sue in respect of company property in a personal capacity unless the suit is brought as a derivative action and the legal requirements for such an action are satisfied.

It was submitted that the 1st Respondent had not pleaded a derivative action and could not purport to sue for recovery of land allegedly belonging to the company.

Regarding the affidavit of Marion Tugumusirize, Counsel maintained that any person with sufficient knowledge of the facts may swear an affidavit and that her evidence was necessary to explain the company's registration status.

Respondents' Submissions

Counsel for the Respondents submitted that the application ought not to succeed because the 1st Respondent was the sole surviving shareholder of the company and therefore had a sufficient legal interest to protect the company's property.

They argued that after the death of the other shareholder, it became necessary for Nawoova Betty to act in protection of the company pending regularisation of its affairs.

Counsel further submitted that the company had already been restored through the OBRS process and that upon restoration, a company is treated as though it had never been struck off.

The Respondents also raised a preliminary objection challenging the admissibility of the affidavit sworn by Marion Tugumusirize. They argued that she was not a party to the application and lacked authority to swear the affidavit on behalf of the Commissioner Land Registration.

Counsel therefore urged the Court to strike out the affidavit and dismiss the application.

COURT'S FINDINGS

On Whether The Application is Proper before the court

The Court observed that a preliminary objection is a legal argument seeking to prevent a court process from proceeding in violation of applicable law, citing the Ghanaian Supreme Court decision in Nana Korkor Ntim v Stephanie Ansaa Opere (SCA No. 14/64/2022). The Court reiterated the locus classus case of Mukisa Biscuits Manufacturing Co. Ltd v West End Distributors Ltd, where Law JA stated that:

“So far as I am aware, a preliminary objection consists of a point of law which has been pleaded or which arises by clear implication out of pleading and which if argued as a preliminary point may dispose of the suit.”

The Court further noted, citing Yaya Farajallah v Obur Ronald & 3 Others, that a preliminary objection must rest on a commonly accepted set of facts and cannot be raised where facts remain to be ascertained through evidence or where the exercise of judicial discretion is required.

Applying these principles, the Court found that both parties agreed that the 2nd Respondent had been struck off the Register of Companies, and that following the death of Kasasira Florence, the 1st Respondent remained the sole shareholder, which was why she had applied for an order to hold a single-member meeting. These were undisputed facts upon which the Application was premised.

The Court agreed with the Applicant's Counsel that, citing Roofings Ltd & Anor v Roko Construction (Company Cause No. 6 of 2020), where parties frame issues on preliminary objections, court ought to pronounce itself on them in a ruling or judgment.

Accordingly, the Court held that the Application was properly before it for the determination of preliminary points of law arising from the substantive suit.

Issue (i) was therefore answered in the affirmative.

On whether the 3rd Respondent's Affidavit was admissible?

The Court identified two distinct contentions; first, that the 3rd Respondent was a non-party to the Application; and second, that Ms Marion Tugumusirize lacked authority to depose on its behalf.

On the first point, the Court noted that while the Applicant had acknowledged in rejoinder that the Commissioner Land Registration (3rd Respondent) was a party to the main suit, being party to the substantive suit does not automatically confer party status in subsequent applications.

However, invoking Order 1 rule 10(2) of the Civil Procedure Rules and section 98 of the Civil Procedure Act, Cap 282, the Court held that it could add a party whose presence is necessary for effectual adjudication, and proceeded to add the 3rd Respondent to the Application on that basis.

On the second point, the Court extensively reviewed the principles governing competence to swear affidavits under Order 19 of the Civil Procedure Rules and section 117 of the Evidence Act, quoting the explanation in Bank One Limited v Simbamanyo Estates Ltd that;

“...what is required in affidavits is the knowledge or belief of the deponent, rather than authorisation by a party to the litigation... Competency to swear an affidavit is pegged to ability ‘to depose to the facts of the case,’ which in turn is circumscribed by the deponent's ability to ‘swear positively to the facts,’ on account of personal knowledge or disclosure of the source, where that is permitted.”

The Court noted that the line of authority requiring written authorisation to swear on behalf of others (including Kaingana John v Boubon Dabo [1986] HCB 59, as relied upon in Lukwajju v Mucunguzi) was expressly distinguished in Bank One Limited v Simbamanyo Estates Ltd, where the learned Judge observed that;

“I have not found any basis for that principle in the rules of evidence nor those of procedure. The principle appears to have developed from the analogy of representative suits, which analogy I find to be misplaced.”

Turning to the affidavit itself, the Court noted that Ms Marion Tugumusirize had deposed in paragraph 1 that:

“That I am a female adult Ugandan of sound mind, a Senior Registration Officer working with the Uganda Registration Services Bureau and I swear this affidavit in reply in that capacity.”

The Court found that, as a Senior Registration Officer of URSB, the body responsible for the registration and regulation of companies, the deponent was uniquely placed to speak to the 2nd Respondent's registration and legal status, which were among the central issues in the Application.

The Respondents' preliminary objection was overruled. The affidavit sworn by Ms Marion Tugumusirize was admitted as competent evidence, and Issue (ii) was answered in the affirmative.

On whether the 2nd Respondent has legal capacity to sue

The Court undertook a detailed review of the statutory framework under section 263 of the Companies Act, Cap 106, and Regulations 41 to 43 of the Companies Regulations, 2023, setting out the distinct processes of striking off, restoration, and deregistration.

On striking off, the Court noted that the Registrar may, on thirty days' notice published in a newspaper or other media, strike a defaulting company off the register, and that operating a struck-off company is an offence under Regulation 41.

On restoration, the Court explained that a struck-off company may apply for administrative restoration by the Registrar only within twelve months of being struck off; any person aggrieved by the striking off may apply to the Registrar within five years; and beyond the twelve-month window, restoration can only be achieved through a court order. The restoration process requires a written application stating grounds, a thirty-day Gazette notice of intention to reinstate, and, where unopposed, formal reinstatement and notification in the Gazette.

On deregistration, the Court noted that where a struck-off company fails to apply for restoration, or its application is rejected, the Registrar deregisters the company, archives its particulars, and may issue a certificate of dissolution.

Applying this framework, the Court found that the 2nd Respondent had been struck off the register for failure to file annual returns for five consecutive years since 2013, most likely resulting in it being struck off in or around 2018. The 1st Respondent's efforts to restore the company, initiated in 2025, were therefore made well over five years after the striking off, far beyond both the twelve-month administrative window and even the five-year window for an aggrieved party's application. Restoration, if available at all, could only have been achieved through a court order, and no such order was on record.

The Court also found that, even on the Respondents' own case, the restoration process described in Ndawula Ronald v Hiira Traders Ltd was not completed. The Court quoted the relevant passage from that decision at length, including the holding that;

“...the respondent by reason of being de-registered, ceased to exist as a legal person... and is therefore unable to carry out any of the legal functions of a company. Proceedings for or against the respondent cannot be pursued unless and until it has been restored to the Register.”

The Court held that Counsel for the Respondents had misinterpreted this authority in treating the data-update step as equivalent to restoration; the data update is merely the starting point of a multi-stage process, and the Respondents had adduced no evidence of having completed the subsequent statutory steps.

The 2nd Respondent had no legal capacity to institute or maintain HCCS No. 0353 of 2025, for want of restoration on the Register of Companies.

Issue (iii) was answered in the negative.

Did the 1st Respondent Have Locus Standi?

The Court accepted, in principle, that a shareholder may bring a suit on behalf of a company, citing David Nahurira v Baguma Cyprian Begumanya & 2 Ors (Civil Suit No. 393 of 2014);

“Where the company is defrauded by a wrongdoer, the company itself is the proper person to sue for the damage. However, a suit would be brought by individual 'corporators' in their private characters, in the protection of rights to which in their corporate character they were entitled.”

The Court accepted that the 1st Respondent, as the sole surviving shareholder, had reasonable grounds to seek to protect the company's interests. However, the Court held that the exercise of shareholder rights is necessarily tied to the existence of the company itself.

Having already found, under Issue (iii), that the 2nd Respondent had no legal existence for want of restoration on the Register of Companies, the Court concluded that the 1st Respondent could not exercise shareholder rights over a non-existent company.

The 1st Respondent had no locus standi to institute or maintain HCCS No. 0353 of 2025, whether in her own name or in the name of the 2nd Respondent. Issue (iv) was answered in the negative.

 Remedies and Costs

The Applicant had prayed for declarations that the 1st Respondent lacked locus standi, that the suit was barred in law and an afterthought, that it disclosed no cause of action, and that it was misconceived, incompetent, frivolous and vexatious, together with costs.

The Respondents had prayed for findings that the Applicant had misapplied the law on deregistration, that the 1st Respondent had locus standi under established exceptions, that the 2nd Respondent's legal status had been regularised prior to filing the suit, that the substantive issues (including acquisition of the 2nd Respondent's property) were unsuitable for summary disposal, that the preliminary objection to Ms Tugumusirize's affidavit be upheld, and that the Application be dismissed with costs.

The Court noted that costs follow the event under section 27 of the Civil Procedure Act, Cap 282, and having resolved Issues (i) to (iv) in the Applicant's favour, held that the 1st Respondent, as the party found to have no standing, should bear the costs of the Application

HOLDING

The High Court allowed the application and made the following orders:

1. The preliminary objection challenging Marion Tugumusirize's affidavit was overruled.

2. The affidavit sworn by Marion Tugumusirize was maintained on the court record.

3. The 1st Respondent, Nawoova Betty, was found to have no locus standi to institute HCCS No. 353 of 2025.

4. Hilltop Academy Limited was found to have no legal status to institute or maintain HCCS No. 353 of 2025.

5. HCCS No. 353 of 2025 was dismissed for lack of locus standi.

6. The 1st Respondent was ordered to pay the costs of the application.

Read the full case

Nakasi Dorcus v Nawoova Betty and Others 2026 UGHCLD 212 (12 June 2026).pdf

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Key takeaways

1. A company struck off the Register of Companies ceases to exist as a legal person and loses capacity to sue or be sued; this status persists unless and until the company is formally restored through the statutory process, not merely through a data-update application on the OBRS portal.

2. Restoration onto the Register can be done administratively by the Registrar only within twelve months of striking off (or within five years for an aggrieved party's application); after that, restoration is only possible by court order. A mere OBRS data update is the first step of the process, not proof of completed restoration.

3. A shareholder's right to commence or maintain proceedings to protect a company's interests is parasitic on the continued legal existence of the company; where the company has ceased to exist in law, the shareholder cannot exercise any derivative or representative standing on its behalf.

4. An affidavit's competence turns on the deponent's personal knowledge of the facts deposed to, not on formal authorisation by a party to the litigation, even where the deponent is an officer of a non-party government body whose evidence is relevant to a contested issue.

5. Courts may invoke Order 1 rule 10(2) of the Civil Procedure Rules and section 98 of the Civil Procedure Act to add a necessary party to an interlocutory application of their own motion, where that party's presence is required for effectual adjudication.

6. Preliminary objections on locus standi, capacity to sue, and competence of a suit may properly dispose of an entire suit at the interlocutory stage, provided they are grounded in facts undisputed by the parties.