The High Court at Kabale clarifies that even if someone is in prison, they can still take part in court cases filed by or against them virtually, in observance of the right to a fair hearing.

Facts

The dispute arose from an arrangement between the plaintiffs and defendants involving a foreign NGO, concerning the welfare of vulnerable children in Kabale District. The 1st Plaintiff, a U.S.-based non-profit organization, together with its Executive Director (the 2nd Plaintiff), entered into a Memorandum of Understanding (MOU) with the 2nd Defendant, a community-based organization, to provide medical, educational, and financial support to over 140 children.

Pursuant to this arrangement, the plaintiffs remitted USD 60,000 to the defendants for the purchase of land intended for charitable use. However, the land was purchased, registered in the 1st Defendant’s personal name, and became the subject of conflicting sale agreements reflecting different purchase prices (UGX 185,000,000 and UGX 145,000,000).

The plaintiffs alleged misrepresentation of the purchase price, acquisition of less land than agreed, improper registration of the land in the 1st Defendant’s name, and an attempted sale contrary to the MOU. In response, the defendants admitted receipt of the funds but maintained that the land was held in trust for the 2nd Defendant, denied any fraud or intention to sell, and asserted that they had properly accounted for the funds. Notably, the 1st Defendant was incarcerated and did not participate in the proceedings beyond filing a written statement of defence.

ISSUES FOR DETERMINATION

While the matter is pending full trial, the sole issue before Court at this stage was:

1.   Whether the Plaintiffs are entitled to proceed ex-parte against the Defendants.

The broader issues to be determined at trial included:

1. Whether the Defendants breached the duty of trust and fiduciary duties owed to the Plaintiffs.

2. Whether the Defendants committed fraud in the execution of the land transaction.

3. Whether the Plaintiffs are entitled to recover USD 60,000.00 / UGX 220,000,000.

4. Whether the suit land is held on constructive trust for the benefit of the Plaintiffs.

5. Whether the Defendants are liable in damages.

 

Legal Representation

Plaintiffs: Justus Muhangi & Co. Advocates

Defendants: Initially represented by Otto Gulamali Advocates, (but later unrepresented.)

Plaintiffs' Case

The Plaintiffs' plaint prayed for a declaration that the Defendants breached their duty of trust. A declaration that the Defendants breached their fiduciary duties. A declaration that the Defendant committed fraud. An order for recovery of USD 60,000.00 or UGX 220,000,000.  In the alternative, an order declaring the suit land is held in trust for the Plaintiffs.  An account of all sums received by the Defendants.  General, exemplary, and punitive damages. Costs of the suit.

Counsel for the Plaintiffs, M/S Justus Muhangi and Co. Advocates, applied to Court for leave to proceed ex-parte under Order 9, Rule 20(1)(a) of the Civil Procedure Rules, S.I. 71-1, on grounds that the 1st Defendant had been served with summons for directions at Luzira Prison on 13 May 2025 but declined to participate. A joint scheduling memorandum was also served on the 1st Defendant at Luzira Prison on 3 July 2025, equally without response. The Defendants had filed a written statement of defence but taken no further steps in the proceedings. The 1st Defendant was awaiting sentencing by the International Crimes Division of the High Court.

Defendants' Case

The Defendants, through their written statement of defence, averred that the MOU was dated 15 May 2016 to raise money for the purchase of land.

That they admitted receipt of USD 60,000.00 from the Plaintiffs for the purchase of the suit land.

They claimed to have accounted for the funds received prior to the 1st Defendant's arrest and detention.

The 1st Defendant holds the suit land in trust for the 2nd Defendant, which is the actual owner; they denied any personal interest in the property.

The 1st Defendant denied forging the purchase agreement and denied any intention to sell the suit land.

The Defendants denied causing any damage to the Plaintiffs and prayed for: dismissal of the plaint with costs; a declaration that there is no cause of action; and a declaration that there is no intention to sell the suit land.

At the time the matter was fixed for hearing, M/S Otto Gulamali Advocates (defence counsel) had ceased acting, and the Defendants appeared unrepresented.

COURT'S FINDINGS

Common Facts Not in Dispute

The Court identified the following undisputed facts from the pleadings of both parties:

1. There is a valid MOU between the 1st Plaintiff and the 2nd Defendant.

2. The Plaintiffs transferred USD 60,000.00 to the Defendants.

3. Land was purchased and registered in the 1st Defendant's name.

4. The land, though registered in the 1st Defendant's name, belongs beneficially to the 2nd Defendant.

The triable issue identified by the Court concerned the quantum of funds applied to the land purchase, given the existence of two conflicting sale agreements, one for UGX 185,000,000 and another for UGX 145,000,000, a fact not denied by the Defendants in their written statement of defence.

The Legal Standard for Ex Parte Proceedings

The Court reaffirmed the legal standard for ex parte proceedings under Order 9, Rule 20(1)(a) of the Civil Procedure Rules, S.I. 71-1, which provides:

“Where the plaintiff appears and the defendant does not appear when the suit is called on for hearing—(a) if the court is satisfied that the summons or notice of hearing were duly served, it may proceed ex parte.”

The Court emphasised that an application to proceed ex parte must be made in good faith and hinges on proof of due service. The Court cited Lucy Ssebaale Nantale v Rukundo Jennifer and Another (Miscellaneous Application No. 772 of 2022) [2025] UGHCFD 110 (26 September 2025), where Busingye J. observed:

“Indeed, the court's jurisdiction to proceed against a defendant ex parte hinges on whether a defendant has been duly served.”

Constitutional Right to a Fair Hearing

The Court addressed the Defendants' constitutional right to a fair hearing under Article 28(1) of the Constitution of Uganda:

“In the determination of civil rights and obligations or any criminal charge, a person shall be entitled to a fair, speedy and public hearing before an independent and impartial court or tribunal established by law.”

The Court further noted that the right to a fair hearing is non-derogable under Article 44(c) of the Constitution, and that a criminal conviction or incarceration does not extinguish this right.

Invoking the Judicature (Electronic Filing, Service and Virtual Proceedings) Rules, 2025, specifically Regulation 28(a) and (e), the Court reasoned that an incarcerated person can participate in civil proceedings via a virtual audio link, underscoring that imprisonment is not a barrier to participation:

“A court may hear a case by virtual link in the following circumstances—(a) where a witness lives outside Uganda or is unable to physically appear in court to give evidence; and (e) for any other reason that the court deems necessary and appropriate for a witness to give evidence through a virtual audio link.”

Ex Parte as an Exception

The Court emphasised the exceptional nature of ex parte proceedings, citing Nwoya District Local Government Council v Onyee (Civil Application No. 31 of 2019, [2019] UGHCD 85, 11 April 2019), where Mubiru J. held:

“Ex parte judicial proceedings are an exception to the usual rule of court procedure and the right to a fair trial, which requires that both parties appear before a judicial officer.”

Despite recognising this exception, the Court balanced it against the totality of circumstances: both parties had filed pleadings; the 1st Defendant had been served twice (at Luzira Prison on 13 May 2025 and again on 3 July 2025); and the Defendants had voluntarily chosen not to participate beyond filing their written statement of defence.

HOLDING

The Court ordered as follows:

1. The Plaintiffs' prayer to proceed ex parte is granted.

2. The Registrar is directed to fix the matter for hearing within 14 days. A copy of the ruling and orders must be served on the 1st Defendant (as director of the 2nd Defendant) at Luzira Prison, so as not to foreclose his right to participate in the proceedings.

3. Costs shall abide the outcome of the main suit.

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KEY TAKEAWAYS

1. Proof of Due Service is the Gateway to Ex Parte Proceedings

Courts will only grant ex parte orders where the applicant satisfies the threshold requirement of due service. In this case, the dual affidavits of service, evidencing service at Luzira Prison on 13 May 2025 and 3 July 2025, were determinative. Litigants must document service, especially where a defendant is incarcerated or otherwise difficult to reach.

2. Incarceration Does Not Extinguish Civil Procedural Rights

The Court invoked the Judicature (Electronic Filing, Service and Virtual Proceedings) Rules, 2025, which signals that defendants in prison retain full procedural rights in civil matters. Courts are obliged to facilitate participation (e.g., via virtual links) and must continue to serve process on incarcerated defendants. Practitioners should proactively write to court to arrange virtual participation for incarcerated clients.

3. Ex Parte is an Exception

Ex parte proceedings derogate from the fundamental right to a fair hearing. Even where granted, courts impose protective conditions (e.g., continued service on the absent party and the opportunity to apply to set aside the judgement) to preserve the non-derogable constitutional right under Article 44(c).

4. Dual Sale Agreements Signal a Triable Issue of Fraud

The existence of two contradictory sale agreements for the same land (UGX 185,000,000 vs UGX 145,000,000), neither of which the Defendants denied, constitutes a clear triable issue of fraud and misrepresentation.

5. Registration of Donated Assets in Personal Names Creates Legal Risk

The registration of land purchased with donor funds in the personal name of an individual (as opposed to a CBO or trust entity) creates significant fiduciary and legal risk. Future philanthropic agreements should include express provisions requiring institutional registration, independent oversight, and anti-alienation clauses, reinforced by caveats lodged at the outset.

6. Cross-Border NGOs Demands Due Diligence

This case illustrates the vulnerability of foreign non-profit organisations engaging in philanthropic activities through local partners. USD 60,000 was transferred based on an MOU without sufficient safeguards for financial accountability or land registration oversight. Donors should conduct thorough due diligence, require independent audits, and establish enforceable trust structures before disbursing funds.