Republic of Uganda v Rift Valley Railways (Uganda) Ld & Ors

Under CPR 19.2(2)(a), joinder involves two questions: whether the proposed party can assist the court to resolve matters in dispute, and whether joinder is desirable. The provision is broad and does not require proof that the proceedings cannot be determined without the proposed party. Joinder may be desirable in the broader interests of justice and the overriding objective, even where the proposed party’s rights are not directly affected. A parent company is not barred from joinder, although its status alone is insufficient. Relevant considerations include the party’s ability to address issues on which it has a distinct interest, the risk of further proceedings, and contingencies affecting the existing party’s representation.

The Republic of Uganda brought a challenge under section 67 of the Arbitration Act 1996 concerning arbitral determinations that an arbitration could proceed despite the liquidation of Rift Valley Railways (Uganda) Ltd. Its direct and indirect parent companies, RVR Investments (Pty) Ltd and KU Railways Holdings, applied to be joined to the court proceedings under CPR 19.2. They relied on their interests in the arbitration, their involvement in a challenge to the liquidation, and the possibility of related or further arbitrations. The central issue was whether their participation was permitted and desirable under CPR 19.2(2)(a) or (b).

1. Application granted. The shareholders were joined to the section 67 challenge.
2. CPR 19.2(2)(a) contains two conditions. First, the proposed party must be able to assist the court in resolving the matters in dispute. Secondly, it must be desirable to add that party for that purpose. The rule confers a broad discretion once the jurisdictional condition is met.
3. The court rejected a strict “but for” requirement. The wording of CPR 19.2(2)(a), read with the overriding objective, permits joinder where the proposed party’s presence is desirable in the broader interests of justice, even if its rights are not directly affected.
4. The shareholders could assist on the substantive section 67 issues, including the validity of the liquidation, because one shareholder had brought the relevant challenge in Uganda. They also had a distinct potential interest in the relief and in the status of any arbitration agreement affecting them. Their involvement could assist in securing finality and reducing the risk of multiplicity of arbitral proceedings.
5. The possible exclusion of RVRU’s existing representation created a further contingent reason for joinder. If that representation could not act, issues in which the shareholders had an equivalent or distinct interest might otherwise be left without adequate representation.
6. Being a parent company was not a bar, although that status alone would not establish joinder. The court did not need to determine CPR 19.2(2)(b), or whether joinder under Part 62 was appropriate. The shareholders were warned that duplicated costs caused by their joinder could affect costs recovery.