The chronic delays in Court frustrated business litigants, prompting the Government of Uganda and the Donor community to establish the Commercial Court to solely handle business disputes and expeditiously.
However, hope and excitement in the business community were short-lived, as delays in dispute resolution at commercial court persisted, mainly because the ordinary Court procedures responsible for the delays remained largely unchanged.
It seemed the Judiciary’s only strategy to make a difference at the Commercial Court was to introduce mediation, assuming parties would agree amicably, thereby reducing the backlog for the understaffed court.
This approach was flawed, as it ignored the fact that many businesses come to Court after exploring all avenues for settlement hence
many filed cases fail in mediation and ultimately end up for trial.
The trial process is long and heavily bureaucratic, taking an average of three years to dispose of a suit at the Commercial Court.
Also, many Ugandan judges may not fully appreciate modern business dynamics, given that laissez-faire economics and capitalism are relatively recent developments in Uganda.
Many Judges do not appreciate the importance of time in business success or be sensitive to the time-sensitive nature of modern business.
This lack of understanding has contributed significantly to the current situation at the Commercial Court.
Most foreign businesses operating in Uganda use borrowed capital, making their success inextricably linked to meeting time schedules in their work plans.
Here is a breakdown of the bureaucracy at the commercial court;
- Filing the Plaint and Issuance of Summons: The process begins when a Plaintiff files a Plaint (stating the claim and remedies sought) and pays the requisite court fees. The Court issues summons, commanding the Defendant(s) to appear and defend the suit within 21 days. The Defendant has 15 days to file a written statement of defense.
- Mediation: The case goes to mediation, which must close within 60 days.
- Directions: If mediation fails, parties take out summons for directions and appear before the registrar to guide the trial process. The registrar sets timelines for filing documents, witness statements, and trial bundles.
- Trial Scheduling: The case is forwarded to a Trial Judge for scheduling, but due to the influx of cases and back log, this can take 6 months.
Considering these delays, a litigant in Uganda’s Commercial Division can expect to spend at least two years before receiving a first-instance judgment. Appeals can add another 1-2 years, and further appeals to the Supreme Court can stretch the process to five years or more.
Foreign Corporations operating or intending to operate in Uganda, the advice is clear: use non-Court settlement dispute mechanisms. Adopt arbitration clauses in operational documents to avoid court settlements.
