Wakilii

Standard Chartered Bank v Makoko (Civil Appeal 307 of 2020)

Court of Appeal · [2025] UGCA 115 · 2025 Appeal Allowed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Appeal and cross-appeal from an Industrial Court award, on points of law only under section 22 of the Labour Disputes (Arbitration and Settlement) Act 2006
Decision
Appeal allowed and cross-appeal partly allowed; general damages reduced to UGX 500,000,000 and unvested-share award to USD 20,000, with interest at 10% and 8% per annum respectively.

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Holding

Exercising its point-of-law jurisdiction over the Industrial Court, the Court of Appeal reduced an unlawfully dismissed bank executive's general damages from UGX 1 billion to UGX 500 million, holding that absent aggravating circumstances an award should not exceed, let alone double, the employee's annual income. It set aside the US$108,750 unvested-share-options award and substituted US$20,000, the only amount proven to have vested. Interest of 15% was reduced to 10% on general damages (from the date of the award) and 8% on the dollar share award (from the date of dismissal). The cross-appeal succeeded only on interest timing; claims for statutory compensation, aggravated damages, reinstatement and outstanding contract sums all failed.

Facts

The respondent was employed by the appellant bank from 1995, rising over about 20 years to Regional Head of Financial Markets and Wholesale Banking for East Africa, based in Nairobi, earning the equivalent of UGX 490,000,000 per annum. In 2015 she was terminated without a hearing and before completion of a performance improvement process. The Industrial Court found the dismissal unlawful and awarded her UGX 1,000,000,000 in general damages, US$108,750 for unvested share options, and 15% interest per annum on both. The bank appealed the quantum only, not liability; the respondent cross-appealed seeking statutory compensation, aggravated damages, reinstatement, higher general damages and outstanding contract sums. The Performance, Pay and Potential statements (exhibits R3A–R3D) showed that share awards for earlier years had vested, that only US$20,000 (for 2013) remained outstanding, and that no award was made for the 2014 performance year because her performance was unsatisfactory.

Issues

  1. Whether the Industrial Court acted on wrong principles in awarding the respondent UGX 1,000,000,000 in general damages for unlawful dismissal without basis in law.
  2. Whether the respondent proved an entitlement to unvested share options worth US$108,750 and whether that award amounted to double recovery contrary to section 93(5) of the Employment Act 2006.
  3. Whether the Industrial Court erred in awarding interest of 15% per annum on the general damages and the share-option award.
  4. Whether the respondent was entitled to statutory compensation under sections 78(1) and 66(4) of the Employment Act 2006 in addition to general damages.
  5. Whether the respondent was entitled to aggravated damages, reinstatement, and the sums outstanding on her contract of employment.

Orders

  • The appeal succeeds.
  • The cross-appeal partially succeeds.
  • The award of UGX 1,000,000,000 as general damages is set aside and replaced with an award of UGX 500,000,000.
  • The award of USD 108,750 (UGX 401,445,187) in unvested shares is set aside and replaced with an award of USD 20,000.
  • Interest of 10% per annum on the general damages from the date of the award until payment in full.
  • Interest of 8% per annum on the unvested-share award from the date of dismissal until payment in full.
  • No order as to costs before the Court of Appeal; the respondent shall have 50% of the taxed costs before the Industrial Court.

Key headnotes

Damages & Quantum — Appellate Interference with Award — Wrong Principle or Erroneous Estimate
An appellate court will not interfere with a trial court's award of damages unless the trial court acted on a wrong principle of law or the amount awarded is so high or so low as to amount to an entirely erroneous estimate of the damages to which the claimant is entitled.
Employment & Labour — General Damages for Unlawful Dismissal — Ceiling at Employee's Annual Income Absent Aggravation
General damages for unlawful dismissal are governed by the principle of restitutio in integrum; absent circumstances in the termination rising to an aggravated standard, an award of general damages should not exceed the employee's annual income, and an award that more than doubles that income is excessive.
Employment & Labour — Share Options as Special Damages — Proof by Evidence Not Submissions
An entitlement to unvested share options is in the nature of special damages and must be specifically proved on a balance of probabilities by documentary evidence; a court must base its findings on the evidence rather than on the submissions of counsel, and may award only the value of shares shown to have been earned and not yet vested.
Civil Procedure — Award of Interest — Discretion, Accrual Date and Foreign Currency
The award of interest under section 26 of the Civil Procedure Act is discretionary and must be exercised judiciously; interest on special damages runs from the date of loss (in wrongful dismissal, the date of dismissal) while interest on general damages runs from the date of judgment or award, and a lower rate is appropriate on a stable foreign currency such as the US dollar.
Employment & Labour — Statutory Compensation under ss.78(1) and 66(4) — Double Recovery with General Damages
The basic compensatory award under section 78(1) and the four weeks' net pay under section 66(4) of the Employment Act 2006 are remedies within the mandate of a labour officer, who cannot grant general damages; where the Industrial Court has awarded general damages, also granting compensation under sections 78(1) and 66(4) would amount to double recovery.
Employment & Labour — Reinstatement — Discretionary and Excluded for Procedural Unfairness
Reinstatement under section 71(5)–(6) of the Employment Act 2006 is discretionary, not mandatory; it will not be ordered where it is not reasonably practicable or where the dismissal was unfair only because the employer failed to follow a proper procedure, and a court will not use its powers to compel an employer to retain an employee it no longer wishes to keep.
Employment & Labour — Terminal Benefits — No Entitlement to Sums for the Unexpired Contract Period
An employee whose contract of employment is wrongfully or prematurely terminated is not entitled to the remuneration or benefits that would have accrued over the unexpired period of the contract; the only money claim is for damages, and only benefits already accrued survive the termination.

Legislation cited (9)

  • Employment Act 2006 s.93(5)
  • Employment Act 2006 s.78(1)
  • Employment Act 2006 s.77
  • Employment Act 2006 s.66(4)
  • Employment Act 2006 s.66(5)
  • Employment Act 2006 s.71(5)
  • Employment Act 2006 s.71(6)
  • Civil Procedure Act Cap 282 s.26
  • Labour Disputes (Arbitration and Settlement) Act 2006 s.22

Cases cited (35)

  • [2011] UGSC 18
  • [1909] AC 488
  • [2012] 2 AC 22
  • African Field Epidemiology Network v Kityaba (Civil Appeal No. 124 of 2017)
  • [1996] UGSC 12
  • Attorney General v Okullo (Civil Appeal No. 207 of 2016)
  • [2021] UGCA 33
  • Lubanga v Ddumba (Civil Appeal No. 10 of 2011)
  • Robert Coussens v Attorney General (Civil Appeal No. 8 of 1999)
  • (1968) EA 93
  • Gullabhai Ushallani v Kampala Pharmaceutical Ltd (SCCA No. 6 of 1999)
  • (1960) EA 490
  • (1873) LR 1 CP 767
  • [2008] UGSC 21
  • Barclays Bank of Uganda v Godfrey Mubiru (SCCA No. 1 of 1998)
  • Bradley Jones vs JP Morgan Securities Plc, case number 3201630, Employment Tribunal (UK)
  • Basiima Kabonesa and 2 ors v Attorney General (Constitutional Appeal No. 196 of 2018)
  • Uganda Development Bank vs. Florence Mufumba
  • [2022] UGCA 312
  • Charles Lwanga v Centenary Rural Development Bank (Civil Appeal No. 30 of 1999)
  • [1963] 3 All ER 899
  • Omunyokol v Attorney General (Civil Appeal No. 6 of 2012)
  • [2021] ZACC 36
  • UKEAT/0148/18/RN
  • Olweny v Equity Bank (U) Ltd (LDC No. 225 of 2019)
  • Shell Uganda Ltd v Choudry (Civil Appeal No. 32 of 2010)
  • Yona Kanyomozi v Motor Mart (U) Ltd (SCCA No. 15 of 1995)
  • (1944) 11 EACA 11
  • Uganda Revenue Authority v Stephen Mabosi (SCCA No. 1 of 1996)
  • [1947] All ER 469 (HL)
  • (1981) 3 All ER 716
  • Shokatali Abdulla Dhalla v Sadrudin Merrali (SCCA No. 32 of 1994)
  • [1964] AC 1129
  • [2006] UGSC 18
  • [1956] 1 QB 658
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.