” ARBITRATION ALERT “
Background
On the 22nd day of August 2025, the Court of Appeal of Uganda has, in a series of decisions, made several pronouncements in respect to a litigation dispute (‘Dispute’) between Vantage Mezzanine Fund II Partnership (‘Vantage’) and Simba Properties Investment Company Limited (‘Simba Properties’) and Simba Telecom Limited. The resolution of the Dispute has, along the way, raised several key principles in the realm of civil litigation and commercial law practice in Uganda. In this article, we will examine the implications of the Court of Appeal’s decision from the perspective of arbitration practice.
The Case
High Court of Uganda
High Court Miscellaneous Application 201 of 2020;
Simba Properties filed Civil Suit 988 of 2019 and various interlocutory applications in the High Court, Commercial Division, seeking to challenge the terms of the Mezzanine Term Facility Agreement (‘MFTA’) entered into with Vantage. Vantage filed HCMA 201 of 2020 challenging the propriety of the proceedings in Civil Suit 988 of 2019, the orders and applications arising therefrom. Vantage contended that the Dispute in Civil Suit 988 of 2019 on the performance of the terms of the contractual terms under the MFTA was the subject of a valid, binding and enforceable arbitration clause between the parties within the premises of the Arbitration and Conciliation Act, Cap 5 (‘ACA’).
The court found that the arbitration agreement was valid and enforceable and that the matters in dispute were to be settled by arbitration. The court accordingly dismissed Civil Suit 988 of 2019, and the applications arising therefrom and referred the matter to arbitration in accordance with the provisions of the MFTA.
High Court Miscellaneous Application 671 of 2021;
Simba Properties filed HCMA 00671 of 2021 seeking for among others, an order of temporary injunction to halt the selling, alienating and taking possession of various Simba Properties’ and Simba Telecom’s properties until the determination of Civil Suit 424 of 2022 which challenged the validity of the Respondents’ advertisement of a notice of sale regarding the Applicants’ mortgaged property.
The court found that the questions presented by the parties in the HCMA 00671 of 2021 and Civil Suit 424 of 2022, related to the existence, validity, interpretation, performance, breach, or termination of the MFTA which, at the time, was already the subject of an arbitration that had been commenced for that purpose, as held in HCMA 201 of 2020. The court opted not to intervene in the ongoing arbitration proceedings.
High Court Miscellaneous Application 2484 of 2023;
These proceedings followed the issuance of the Final Award. The application was filed under the ACA seeking interim reliefs to preserve the status quo pending the determination of the application to enforce and recognise the Final Award. The court, in the determining the application, clarified that the provisions for the grant of interim relief under the ACA were only exercisable before or during the arbitration process.
As such, by virtue of the issuance of the Final Award, the arbitration proceedings had accordingly been terminated and the power to grant interim reliefs under the ACA could not be exercised at the stage of enforcement of the Final Award. The court, nevertheless, granted the reliefs sought in the exercise of its inherent and wide powers under the Judicature Act, Cap 16 and the Civil Procedure Act Cap 282.
The Court of Appeal of Uganda
At the back of the decisions in HCMA 671 of 2021 and HCMA 2484 of 2023, the parties proceeded to file various applications in the Court of Appeal (‘COA’). The applications filed by Simba Properties and its affiliate parties sought for among others, orders for extension of time and validation of the Notice of Appeals filed in respect to the decisions rendered by the High Court and interim reliefs in the form of protective orders and temporary injunctions. On the other hand, the applications filed by Vantage and its affiliate parties, sought to strike out the Notice of Appeals that had been filed in respect to the decisions rendered by the High Court on the sole ground that no such appeal existed under the law.
The decision;
A fully constituted panel of the COA dismissed all the applications filed by Simba Properties and granted the applications filed by Vantage. In doing so, the COA found that it was not clothed with the jurisdiction to handle the same on the account that the applications arose from a dispute whose proceedings were already subject to arbitration under the ACA.
The COA also found that the interim reliefs sought by Simba Properties under the Civil Procedure Act and Judicature Act were interlocutory in nature and as such still fell within the realm of the arbitration proceedings. In the court’s view, the proceedings in the High Court from which the said applications arose were proceedings under the ACA, for which the reliance on other laws outside the ACA did not render the proceedings outside the realm of the ACA.
The COA relied on the Supreme Court’s decision in Babcon Uganda Ltd versus Mbale Resort Hotel Ltd [2017] UGSC 83 (‘Babcon’) to hold that Section 9 of the ACA is express, insofar as it limits the court’s intervention in arbitration proceedings.
The COA relying on the decision in Babcon found that did not have jurisdiction as no appeal lay before it either, directly or with leave.
Key takeaways
In reaffirming the principles in Babcon, the COA has underscored the following
principles;
a) Arbitration is contractual and court will generally respect the parties’ autonomy and freedom of contract. A court is more likely to recognize an enforceable and valid arbitration agreement unless a party demonstrates that the arbitration agreement is null and void or that the dispute is beyond the confines of arbitration.
b) Court’s intervention in arbitral proceedings is limited to the extent provided for in the ACA, the invocation of other laws outside and or not connected to the ACA, notwithstanding. As such, to the extent that the High Court is not exercising its original jurisdiction and in the absence of specific law creating an automatic right of appeal, no such appeal would arise to the COA in the premises.
Conclusion
The Court of Appeal decision shows the court’s direction i in promoting arbitration through limiting court intervention and respecting the established national legal framework enacted in line with arbitration best practices.
Regarding the dispute, it will be interesting to see whether the curtain has finally fallen or if this will become a battle of wits for the Supreme Court of Uganda to resolve once and for all. We can only speculate. For now, we watch and wait.
Disclaimer:
This publication is for general consumption and should not be taken and relied upon without seeking specific legal advice on any of the matters above.