Busoga Forestry Co. Limited v Batabane Anatole (Civil Application No. 534 of 2026) [2026] UGCA 79 (24 March 2026)

‘THE REPUBLIC OF UGANDA. IN THE COURT OF APPEAL OF UGANDA AT KAMPALA

CIVIL APPLICATION NO. 534 OF 2026 (Arising From Civil Appeal No. 187 of 2022) (Arising from Labour Dispute Reference No. 015 of 2021) (All Arising from Labour Complaint JJA/LAB/025/FEB/2021)

BUSOGA FORESTRY CO. LIMITED ..scosscssstsseseesstsseseeeesAPPLICANT VERSUS

BATABANE ANATOLE «..esccescesssseeseeseeseeceesetseeteesets RESPONDENT BEFORE: HON. LADY JUSTICE STELLA ALIBATEESE, JA 20 (Sitting as a Single Justice) RULING OF COURT 25 This is an application brought by way of notice of motion under Section 37 of the Judicature Act Cap. 16, Section 98 of the Civil Procedure Act Cap 282, and Rules 2(2), 6(2) (b), 42(1), 43(1) and (2), and 44 (1) of the Judicature (Court of Appeal) Rules $.1 No. 13-19. The application is supported by the affidavit in support of Emmanuel Mwebaze, the Finance 30 Manager/Chief Accountant of the applicant. The applicant seeks the following orders;

1. An order of stay of execution be issued by the Honorable Court staying the execution of the Award and /or Decree of the Industrial Court entered against the Applicant in Labour Dispute Reference No. 015 35 of 2021; Batabaine Anatole V Busoga Forestry Co. Limited until final disposal of the Appeal vide Civil Appeal No. 187 of 2022; Busoga Forestry Co. Limited v Batabaine Anatole lodged by the Applicant to the Court of Appeal.

2. Costs of this Application be provided for.

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Background

‘The respondent was an employee of the applicant from 3% January 2011.

In 2020 the applicant carried out a restructuring exercise through which

5 process, the applicant made changes to the structure within the Finance

Department where the respondent was working as a Chief Accountant. In

May 2021, the respondent filed a memorandum of claim against the

applicant in the Industrial Court vide Labour Dispute Reference No.015 of

2021, seeking a declaration that he was constructively terminated, a

10 declaration of breach of contract, special damages for the remaining 9

‘years of service until retirement of UGX 1,366,200,000, acting allowance of

UGX 68,324,000, severance pay of UGX 42,166,667, there months’ salary

in liew of notice and general damages of UGX 300,000,000. The Industrial

Court heard the matter and delivered an award in favor of the respondent

15 and found that he was constructively dismissed and awarded him acting

allowance of UGX 68,364,000, severance allowance of UGX 42,166,667,

payment in lieu of notice of UGX 37,950,000 and general damages of UGX

300,000,000. Being aggrieved with the award, the applicant filed a notice of

appeal on 6% December 2021 and subsequently lodged Civil Appeal No. 187

20 of 2022 which is pending in this Court. The applicant has filed an application for stay of execution and the grounds as set out in the notice of motion are briefly;

1. On the 17 day of May 2021, the Respondent filed a Memorandum of Claim in the Industrial Court vide Labour Dispute Reference Nov 015 of

25 2021, seeking a declaration that he was constructively terminated; a declaration of breach of contract; special damages for salary for the remaining 9 years until retirement totaling Ugx. 1,366,200,000/= acting allowance of Ugx. 68,324,000/= severance pay of Ugx. 42,166,667 /= three months’ salary'in lieu of notice; and general damages of Ugx.

2. On the 2! day of December 2021, the Industrial Court delivered an Award in favor of the Respondent, finding that he had been constructively dismissed and awarding him acting allowance (Ugx. | 68,364,000/=) severance allowance (Ugx. 42,1 66,667/=), payment in |

35 lied of notice (Ugx. | 37,950,000/) “and ’general ‘damages | (Ugx. 120,000,000/=) all totaling a principal sum of Ugx. 268,480,667 /= with interest at 15% per annum from the date of the award.

3. Being dissatisfied with the said Award, the Applicant on the 6! day of December 2021 filed a Notice of Appeal and subsequently lodged Civil

40 Appeal No. 187 of 2022, which is currently pending before this Court for

. determination 21Page

4. On the 20% day of December 2021, the Applicant instituted Miscellaneous Application No. 008 of 2021, seeking an order for stay of | execution of the Award and Decree in Labour Dispute Reference No. 015 of 2021 pending the hearing and determination of Civil Appeal No. 187

5 of 2022 filed in this Court.

5. On the 7 day of April 2022, the Industrial Court granted the application for stay of execution and as one of the conditions required the Applicant to furnish a bank guarantee for the decretal sum. The Applicant diligently complied with the terms of the stay by providing successive

10 guarantees from KCB Bank (U) Limited for the years 2022, 2023 and 2024 to secure the Respondent's interest pending the disposal of the appeal.

6. In the month of June 2025, the Applicant faced an unprecedented delay in renewing the bank guarantee because of the adjustments made by its

15 bankers 1&M Bank, the Respondent then initiated execution proceedings by way of garnishee vide Miscellaneous Application No. 131 of 2025, seeking to attach the Applicant's funds held with I & M Bank (Uganda) Limited to the tune of UGX 436,280,000/=

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7. On the 27% day of August 2025, the Learned Registrar issued a Garnishee Order Nisi in Miscellaneous Application No. 131 of 2025 attaching a sum of UGX 436,280,000/= held by I & M Bank (Uganda) Limited on behalf of the Applicant in response to the Respondent's application for execution following the transitional lapse in the bank

25 guarantee.

8. On the 11% day of September 2025, the Learned Registrar, upon hearing all the parties and with a justifiable reason vacated the garnishee order nisi and declined to make it absolute in the interest of justice, as such,

30 the Applicant presented a valid bank guarantee covering the fuil decretal amount and valid until September 2026.

9. Dissatisfied with the Registrar's decision, the Respondent appealed to the Judge of the Industrial Court vide Miscellaneous Application No. 149 of 2025, challenging the Learned Registrars exercise of his discretion in

35 allowing the Applicant to produce a new Bank Guarantee and on the 27 day of January 2026 the Industrial Court delivered its ruling setting aside the Registrar's decision and ordering that the garnishee order nisi be made absolute.

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10. The Ruling in Miscellaneous Application No. 149 of 2025 has the direct effect of setting aside the stay of execution granted in HCMA No. 008 of 2021, for the simple reason that it expressly sets out to execute the very award that the order of stay was supposed to halt.

11. Unless this Court intervenes to stay the execution of the orders and

45 decree in Labour Dispute Reference No.15 of 2021, the Applicant's right, to appeal and the Appeal itself shall be’ rendered nugatory notwithstanding the fact that all appeal documents and timelines were ‘complied with and now awaiting a panel to be heard on its merits,

12.The Applicant's appeal is highly meritorious, has a high likelihood of

50 success and raises substantial questions of law particularly whether a restructure that retains an employee's salary and seniority constitutes constructive dismissal, whether the award of acting allowance was justified in the absence of a formal appointment, and the award of

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excessive damages and interest which the Industrial Court itself, while

granting the initial stay in Miscellaneous Application No. 008 of 2021,

acknowledged that the Applicant's appeal raises substantial issues with

a likelihood of success regarding restructuring thus requires the 5 determination of this Court.

13. Unless this Court grants a stay of execution, the Applicant will suffer irreparable loss as its funds currently held by the Garnishee will be paid out to a Respondent who, by his own sworn admissions throughout this dispute, is currently unemployed and burdened with significant

10 outstanding debt, including an unpaid salary loan of over UGX 140,000,000/= with Standard Chartered Bank.

‘The application is accompanied by the affidavit in support of Emmanuel

Mwebaze, Finance Manager of the applicant that reiterates the grounds for

the application and provides documentary evidence of the assertions made.

15. I will not reproduce it here. ‘The respondent opposed the application in his affidavit in reply sworn on 20% February 2026. Briefly he contended as follows; 1, That on 2! December 2021, I obtained an award against the 20 applicant from the Industrial Court broken down as UGX 68,364,000/= as Acting allowance; UGX 42,1 66,667/= as severance Allowance; UGX 37,950,000/= as Payment of three months’ notice; UGX 120,000,000/= as General damages totalling to UGX 268,480,667 /= which money is accruing interest 25 from the time of the award at 15% p.a.

2. The total award together with interest of 15% p.a now (11% February 2026) stands at UGX 437,402,818 which amount remains unpaid to date save UGX 14,580,203 paid on 13 30 February 2026 through garnishee absolute by the Industrial Court.

3. The applicant filed Misc. App. No. 008 of 2021 for stay of execution which application was granted on condition that the 35 applicant takes out a bank guarantee in a bank of my choice for the decretal sum together with interest. 4. ‘That the order of stay of execution granted by the Industrial Court is still subsisting and has never been vacated,

5. In 2025, the applicant breached the conditional order of stay of execution for more than 2 months by its failure to take out a bank guarantee in a bank of my choice inspite of the fact that we had written several reminders to her to renew the same.

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