• Francis Obonyo
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Fraud is the intentional perversion of truth to induce another in reliance upon it to part with some valuable thing belonging to him or to surrender a legal right.

Says Hon Mr. Justice Bashaija in the case of Western Uganda Importers and Distributers Ltd V Muhasa Ivan Mpondi, Kasese District Land Board and Commissioner for Land Registration Civil Suit No. 0014 of 2014.

Before: Hon. Mr. Justice Bashaija K. Andrew on 09/02/2016

The plaintiff (company) purchased land from Steven Barekye. Steven Barekye obtained a lease from the controlling authority for the initial period of two years running from 01.07.1979 extendable to a full term of 49 years on compliance with the building covenant in the lease offer.  Upon purchasing the suit land, the plaintiff also applied for a fresh lease of its own and was given a lease offer for the initial period of two years from 01.08.1982, extendable to a total of 49 years on completion of the building covenant.  The plaintiff went ahead and constructed two warehouses to set up a soap factory on the suit land.

Sometime in 1998, the plaintiff company resolved to sell the suit land due to financial difficulties in its operations, and the 1st defendant was tasked to look for a buyer. The 1st defendant forged minutes and a surrender letter claiming that the plaintiff had agreed to surrender the land to him personally as the owner. He transferred the suit land into his own names as the owner even without paying any consideration for it.

Using the “surrender letter”, the 1st defendant applied to the Kasese Town Council Land Board (2nd defendant) to have the suit land registered in his names. The plaintiff learnt of the 1st defendant’s move and wrote to the 2nd defendant warning that the suit land should not be transferred. However, the 2nd defendant never heeded the plaintiff’s warning but went ahead to grant ownership of the suit land to the 1st defendant.  The 3rd defendant subsequently issued a certificate of title to the 1st defendant.  That prompted the plaintiff to institute the instant suit against all the defendants jointly and severally, seeking the orders outlined above.

The Court resolved the following issues;

Issues No. 1:  Whether the 1st defendant acquired the suit plot by fraud.

“Fraud” was well defined as an intentional perversion of truth to induce another in reliance upon it to part with some valuable thing belonging to him or to surrender a legal right.  A false representation of a matter of fact, whether by words or by conduct, by false or misleading allegations or by concealment of that which deceives and is intended to deceive another so that he shall act upon it to his legal injury.

Furthermore, in David Sejjaaka vs Rebecca Musoke, SCCA No. 12 of 1985, it was held that fraud must be attributable to the transferee, either directly or by necessary implication.

In the instant case, minutes, a surrender letter and signatures were forged. The process of applying for the conversion of land from customary tenure to freehold tenure well knowing that the land is not customary, claiming the land had no occupants, making a wrong notice was fraudulent.

Issue No. 2: Whether the 2nd and 3rd defendants participated in the fraud regarding the suit land.

It was fraudulent of the 1stdefendant to have applied for the land as customary land, well knowing it was not. The 2nd defendant to have received and approved the 1st defendant’s application for land described as customary land well, knowing that no such tenure existed in an urban area, particularly in a municipality such as Kasese, was fraudulent. The 3rd defendant is liable in fraud only to the extent that it acted on the basis of the fraud committed by the 1st and 2nd defendants.

The found that the transaction was tainted with fraud and ordered that the title be cancelled. The plaintiff was declared the lawful owner of the land.