ALCON INTERNATIONAL LIMITED v. THE STANDARD CHARTERED BANK OF UGANDA & 2 OTHERS

Case Number APPEAL NO. 2 OF 2011
Summary

The Appellant was contracted by the National Social Security Fund, Uganda (NSSF) to construct ‘Workers House’, in Kampala. NSSF terminated the agreement and this set in motion arbitration proceedings under the contract. The Appellant was the successful party in the arbitration proceedings. This arbitral award was being contested in the courts in Uganda and the matter was before the Supreme Court in which NSSF sought to set aside the arbitral award.

While the matter was still being litigated in the courts in Uganda, the Appellant herein instituted Reference No. 6 of 2010 in the First Instance Division against the above-mentioned Respondents seeking inter alia: an interpretation and application of Articles 27 (2) and 151 of the Treaty together with Articles 29 (2) and 54 of the Protocol on the Establishment of the East African Community Common Market on the enhanced Jurisdiction of this Honourable Court as a Competent Judicial Authority with regard to the enforcement of trade and resolution and settlement of disputes for the protection of cross-border investments.

During the Scheduling Conference, the 1st Respondent raised a number of preliminary objections on points of law. After dealing with the preliminary objections, the First Instance Division struck out the Reference with costs.

The Appellant then appealed from the Ruling dated 24th August, 2011.
RespondentTHE STANDARD CHARTERED BANK OF UGANDA, THE ATTORNEY GENERAL OF UGANDA ON BEHALF OF THE REPUBLIC OF UGANDA and REGISTRAR OF THE HIGH COURT OF UGANDA
ComplainantAPPEAL NO. 2 OF 2011 ALCON INTERNATIONAL LIMITED
Date filed
CountriesUganda
KeywordConcurrent jurisdiction , Content of judgments , Preliminary Points of law
Treaty ArticleArticle 23 , Article 35 A , Rule 68 , Rule 77 , Rule 92 , Rules of Procedure 2010

First Instance Judgment

VerdictThe Court ordered that the Reference is improperly before the Court as against the 1st, 2nd and 3rd Respondents and that it is not necessary to go into the other grounds raised by the parties or tackle the remaining objections, as the finding alone sufficiently and conclusively disposes of the Reference. The Reference was struck out with costs.
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Date deliveredAugust 23, 2011
Quorum

Appeal Judgment

Verdict
  1. The purpose of raising preliminary objections is not to shut out or stifle legitimate adjudication. While considering the preliminary objection, the court below descended into considering facts and not law. The court below was expected to deal with “pure points of law” which would dispose of the Reference. The issue of jurisdiction had to be answered first before proceeding with any other issue.
  2. In view of the decision it had reached, the court below did not deem it necessary to consider and determine the remaining issues. This was in contravention of Rule 68 (5) as all the issues raised in the Scheduling Conference had to be decided upon.
  3. The cause of action before this Court was an alleged breach or infringement of the Treaty and not an arbitral award for breach of contract as in the Uganda courts. There was, therefore, no likelihood of a conflict or a clash between this Court and the courts of Uganda.
  4. The Treaty and this Court’s Rules of Procedure do not give the Appellate Division concurrent jurisdiction with the First Instance Division.
  5. The First Instance Division did not discuss or make a finding of whether it had jurisdiction to entertain the Reference. This was a fundamental issue which had to be decided as a threshold issue. Therefore the Ruling and Order of the First Instance Division was set aside, and Reference No. 6 of 2010 re-instated.
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Date deliveredMarch 16, 2012
Quorum