Wakilii

Dolamite Engineerings Services Ltd v Equity Bank (U) Ltd (Civil Appeal No. 110 of 2015)

Court of Appeal · [2022] UGCA 281 · 2022 Appeal Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Civil appeal from the High Court (Commercial Division) dismissal of a suit for breach of contract
Decision
Appeal dismissed with costs; High Court dismissal of the suit upheld

The full judgment

Read the complete, verbatim text of this judgment.

Sign in to read the full judgment

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions — always read the source judgment before relying on it.

Holding

The Court of Appeal dismissed the appeal. It overruled all three preliminary objections, holding that an objection to a late-served notice of appeal must be brought by application under rule 82 and required leave under rule 102(b); that absence of an extracted decree does not invalidate an appeal because Article 134(2) of the Constitution and section 10 of the Judicature Act govern, and rule 87 requires a judgment not a decree; and that a badly drafted ground is a matter of form. On the merits, the court found that the appellant was disqualified from the tender for lack of technical capacity and track record before the bank disowned the guarantee, so the bank could not be liable for the lost tender.

Facts

The Ministry of Local Government invited bids for construction of markets including Lira Central Market under African Development Bank procurement rules. The appellant purchased bid documents and applied to the respondent bank for a bid bond guarantee of UGX 500,000,000, paying UGX 5,000,000 in charges. The bank initially wrote to the Ministry confirming the appellant's facility and the authenticity of the bid bond security. After the appellant, dissatisfied with the procurement outcome, lodged an administrative review application on 31 August 2011 alleging corruption and tampering, the Ministry wrote to the bank on 27 September 2011 seeking confirmation of two bid bond securities. On 28 September 2011 the bank replied that one security was never issued. The appellant sued the bank for UGX 6,200,000,000 in lost profits and damages for breach of contract, alleging the bank's disowning of the guarantee caused its disqualification. The tender had, however, already been awarded to Arab Contractors, and the appellant had been disqualified for lacking the required technical capacity and track record.

Issues

  1. Whether the notice of appeal served out of time and absence of an extracted decree rendered the appeal incompetent.
  2. Whether ground 8 of the memorandum of appeal was argumentative contrary to rule 86(1) of the Court of Appeal Rules.
  3. Whether the respondent bank issued the bid bond guarantee and whether the appellant obtained it by fraud or forgery.
  4. Whether the respondent bank was liable for the appellant's loss of the construction tender.
  5. Whether allegations of negligence and breach of fiduciary duty constituted a departure from the pleadings.

Orders

  • Appeal dismissed.
  • Costs of the appeal to the respondent.

Key headnotes

Civil Procedure — Notice of Appeal Served Out of Time — Procedure for Objecting Under Rules 82 and 102(b)
An objection that a notice of appeal was served out of time must be raised by application to strike out under rule 82 of the Court of Appeal Rules, and may not be raised at the hearing without leave of court under rule 102(b); where the respondent had notice and participated in the proceedings, such an objection is not prejudicial.
Civil Procedure — Competence of Appeal — Absence of Extracted Decree
An appeal to the Court of Appeal lies from decisions of the High Court under Article 134(2) of the Constitution and section 10 of the Judicature Act, which supersede section 66 of the Civil Procedure Act; rule 87(1)(g) requires the judgment or reasoned order, not a decree, so the absence of an extracted decree does not invalidate the appeal.
Civil Procedure — Memorandum of Appeal — Argumentative Ground as Matter of Form
Where a ground of appeal sets forth the points alleged to have been wrongly decided but does so in an argumentative style, it is merely badly drafted and a matter of form not substance, and will not be struck out under rule 86(1) of the Court of Appeal Rules.
Banking & Finance — Causation — Liability of Bank for Loss of Tender Where Disqualification Preceded Bank's Conduct
A bank cannot be held liable for a bidder's loss of a tender where the chronology of events shows the bidder was already disqualified for lack of technical capacity and track record before the bank disowned the bid bond guarantee, as there is no nexus between the bank's conduct and the disqualification.
Civil Procedure — Pleadings — Departure From Pleadings on Appeal
A party cannot raise on appeal a cause of action in negligence or breach of fiduciary duty that was not specifically pleaded, particularised, or tried at first instance, as this amounts to a departure from the pleadings and an attempt to introduce a new cause of action.
Administrative Law — Procurement — Remedy of Administrative Review Under the PPDA Act
A bidder aggrieved by a procurement decision must pursue administrative review against the procuring entity under section 89 of the PPDA Act and the PPDA Regulations, and where no review decision exists, a loss arising from procurement cannot be visited upon a third party such as the bidder's bank.

Legislation cited (22)

  • Civil Procedure Act cap 71 s.66
  • Civil Procedure Act cap 71 s.2(c)
  • Constitution of the Republic of Uganda 1995 art.126(2)(e)
  • Constitution of the Republic of Uganda 1995 art.134(2)
  • Judicature Act cap 13 s.10
  • Judicature (Court of Appeal Rules) Directions rule 5
  • Judicature (Court of Appeal Rules) Directions rule 30(1)(a)
  • Judicature (Court of Appeal Rules) Directions rule 32(1)
  • Judicature (Court of Appeal Rules) Directions rule 66(2)
  • Judicature (Court of Appeal Rules) Directions rule 78(1)
  • Judicature (Court of Appeal Rules) Directions rule 82
  • Judicature (Court of Appeal Rules) Directions rule 86(1)
  • Judicature (Court of Appeal Rules) Directions rule 87(1)
  • Judicature (Court of Appeal Rules) Directions rule 102(b)
  • Public Procurement and Disposal of Public Assets Act No 1 of 2003 s.4(1)
  • Public Procurement and Disposal of Public Assets Act No 1 of 2003 s.89
  • Public Procurement and Disposal of Public Assets Act No 1 of 2003 s.89(4)
  • PPDA Regulations No 70 of 2003 reg.344
  • PPDA Regulations No 70 of 2003 reg.346
  • PPDA Regulations No 70 of 2003 reg.347
  • Evidence Act s.101(2)
  • Evidence Act s.103

Cases cited (12)

  • Kampala Bottlers Ltd v Damanico (U) Ltd (Civil Appeal No. 22 of 1992)
  • Fredrick Zaabwe v Orient Bank (U) Ltd and Others (Civil Appeal No. 6 of 2006)
  • Kornak Investments (U) Ltd v Stanbic Bank Uganda Ltd (HCCS No. 116 of 2010)
  • Makau Nairuba Mabel v Crane Bank Ltd (HCCS No. 380 of 2009)
  • Kasibante Moses v Electoral Commission (Election Petition Application No. 07 of 2012)
  • Imere v Uganda (Criminal Appeal No. 0065 of 2012)
  • Uganda Breweries Ltd v Uganda Railways Corporation (Civil Appeal No. 6 of 2001)
  • Kimotho v Kenya Commercial Bank [2003] 1 EA 108
  • Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465
  • Sitenda Sebalu v Sam K Njuba and Electoral Commission (Supreme Court Election Petition Appeal No. 26 of 2007)
  • Hussain Abdallah Hamdan v Hussain Tharel Amuhi Matkan (SC Civil Application No. 4 of 2001)
  • Peters v Sunday Post Limited [1958] 1 EA 424
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.