Wakilii

Kaluuma Kassim and Others v Kampala Capital City Authority (Civil Appeal No. 49 of 2013)

Court of Appeal · [2021] UGCA 226 · 2021 Appeal Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
First civil appeal from a High Court ruling upholding a preliminary objection that employment contracts were discharged by frustration
Decision
Appeal dismissed; trial court's finding that the employment contracts were discharged by frustration upheld

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Holding

The Court of Appeal dismissed the appeal, upholding the trial court's finding that the appellants' contracts as members of the Kampala District Local Government Public Accounts Committee were discharged by frustration by operation of law. The enactment of the Kampala Capital City Act 2010 transformed Kampala from a local government entity into a central government administered authority, fundamentally altering the appointing procedure, qualifications and structure of the Public Accounts Committee. Applying the radical change in obligation test, the Court held that performance had become radically different and that the change resulted from no fault of either party. Each party was ordered to bear its own costs given the nature of the dispute.

Facts

The appellants were appointed on 25 March 2009 as members of the Kampala District Local Government Public Accounts Committee under section 88 of the Local Government Act for a fixed five-year term expiring 30 March 2014. They performed their duties under their contractual terms based on the Local Government Act. In March 2011, following the enactment of the Kampala Capital City Act 2010, which commenced implementation on 1 March 2011, the appellants were discharged from their duties. The Town Clerk asked them to hand over their instruments of office, and they handed over to the Executive Director of the Authority. The new Act transformed Kampala from a local government entity into a central government administered authority, changing the appointing procedure (involving the Lord Mayor and Minister), the qualifications (requiring a certified public accountant and at least one third women members), and the overall structure. The appellants sued for breach of contract, wrongful dismissal and unpaid arrears. The respondent's preliminary objection that the contracts were discharged by frustration was upheld.

Issues

  1. Whether the trial judge erred in holding that the appellants' employment contracts were discharged by frustration as a result of operation of law occasioned by the enactment of the Kampala Capital City Act 2010.
  2. Whether the trial judge erred in failing to properly evaluate evidence that the appellants' contracts, having been operationalized under the Local Government Act, entitled them to remedies under the Kampala Capital City Act.

Orders

  • Appeal dismissed.
  • Each party to bear their own costs.

Key headnotes

Contract Law — Frustration — Discharge by Subsequent Change in Law
A contract is discharged by frustration where a subsequent change in law renders further performance impossible or radically different from what the parties contracted for, provided the supervening event was not foreseeable and arose without the default of either party.
Contract Law — Frustration — Radical Change in Obligation Test
Frustration occurs only where, without default of either party, a contractual obligation has become incapable of being performed because the circumstances would render performance a thing radically different from that undertaken; mere hardship, inconvenience or material loss is insufficient.
Contract Law — Frustration — Burden of Proof
The onus of proving frustration lies on the party alleging it, and once proved the onus shifts to the other party to prove that the frustration was self-induced or caused by negligence or default.
Employment & Labour — Discharge of Employment Contracts — Statutory Abolition or Restructuring of Office
Where a statute abolishes or radically restructures a public office, including changing its appointing authority, qualifications and composition, employment contracts tied to that office may be discharged by frustration by operation of law without attributing fault to either party.

Legislation cited (8)

  • Contracts Act s.66
  • Kampala Capital City Act 2010 s.3(2)
  • Kampala Capital City Act 2010 s.4
  • Kampala Capital City Act 2010 s.58(1)
  • Kampala Capital City Act 2010 s.85(1)
  • Local Government Act (Cap 243) s.88
  • Constitution of Uganda Article 5(4)
  • Judicature (Court of Appeal Rules) Directions SI 13-10 Rule 30(1)(a)

Cases cited (11)

  • Pandya v R [1957] EA 336
  • Kifamunte Henry v Uganda (Criminal Appeal No. 10 of 1997)
  • W.J. Tatem v Gamboa (1939) 1 KB 132
  • Paal Wilson & Co AS vs. Partenreederei Hannah Blumenthal [1983] 1 ALL ER 34
  • Makula International versus His Eminence Cardinal Nsubuga [1982]
  • Davis Contractors v Fareham (1956) 1 AC 696
  • Howard & Co (Africa) Ltd v Burton [1964] EA 540
  • I.K Patel v Spear Motors Ltd (Civil Appeal No. 4 of 1991)
  • Constantine Steamline Ship vs Imperial Smelting Corp (1945) ALL ER 165
  • B. Reilly v The King (1934) AC 776
  • Marshall v Glanvil & Anor (1917) 2 KB 87
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.