B.M. Technical Services Ltd v Crescent Transporters Co. Ltd (Civil Appeal No. 8 of 2002)

Supreme Court · [2003] UGSC 58 · 2003 Appeal Partly Allowed ✦ AI-generated summary ↓ Download

Jurisdiction

Uganda

Case Type

Second civil appeal to the Supreme Court from a Court of Appeal decision in a breach-of-contract suit concerning carriage and clearing of goods

Decision

Appeal partly allowed; interest on the decretal amount reduced from 22% to 10% per annum from the date of filing the suit until full payment.

The full judgment

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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 Supreme Court partly allowed the appeal. On grounds 1 to 3 it held that the written and oral terms, embodied in the admitted Allied Request, formed a binding clearing and carriage of goods contract; the carrier had an implied duty to take reasonable care of the goods, and the appellant's admission of the contract and attempts to perform left the respondent no opportunity or need to mitigate, so those grounds failed. On ground 4 it held that interest at 22% per annum was excessive for a non-commercial clearing and carriage contract; while compensatory sums may carry higher rates, 22% was too high. The Court of Appeal's interest award was set aside and substituted with 10% per annum from the date of filing the suit.

Facts

The respondent agreed to clear the appellant's container from Mombasa and deliver it to Kampala. Under the partly written, partly oral contract the appellant would pay US$4,050 in freight and clearing charges, collect the container within four days of notice of arrival, and pay US$150 per day the container remained on the respondent's trailer in default, with US$20 per day payable for trailer detention. The container was delivered to Kampala on 11 November 1998 and the appellant notified the next day. The appellant paid US$2,767 and acknowledged its indebtedness but never paid the balance or collected the container, despite tendering dishonoured cheques. The respondent eventually dropped the container at its premises on 28 May 1999 and sued for US$35,820. The trial court, hearing the matter ex parte, awarded only US$1,883 in freight and clearing charges with interest at 4%, rejecting the detention claims. The Court of Appeal allowed the respondent's appeal and awarded interest at 22%.

Issues

Whether the respondent was entitled to special damages that were not properly pleaded or proved.
Whether the respondent was entitled to damages that it could have mitigated.
Whether an allied request constituted a contract between the parties.
Whether the Court of Appeal erred in awarding an excessively high interest rate of 22% per annum.

Orders

The appeal partially succeeds.
The order of the Court of Appeal awarding interest at the rate of 22% per annum on the decretal amount is set aside.
The decretal amount shall carry interest at the rate of 10% per annum from the date of filing the suit until full payment.
The respondent is awarded three-quarters of the costs in the Supreme Court and in the courts below.

Key headnotes

Contract Law — Carriage of Goods — Implied Term to Take Reasonable Care

It is an implied term of a contract of carriage of goods that the carrier must take reasonable care to protect the goods in its possession.

Damages & Quantum — Mitigation of Loss — Effect of Defaulting Party's Admission and Attempts to Perform

A party need not mitigate its loss where the defaulting party's admission of the contract and attempts to perform prevented the innocent party from contemplating, let alone mitigating, any loss.

Civil Procedure — Award of Interest — Discretion under s.26 Civil Procedure Act and Appellate Interference

The award of interest under section 26 of the Civil Procedure Act is at the discretion of the court, but an appellate court may interfere with the exercise of that discretion where the rate fixed is unjustified or excessive.

Damages & Quantum — Interest — Excessive Rate in a Non-Commercial Transaction

Interest at 22% per annum is excessive for a non-commercial clearing and carriage of goods contract; although compensatory sums may carry higher rates than ordinarily awarded, such a rate is on the high side and may be reduced.

Legislation cited (2)

Civil Procedure Act s.26(2)
Civil Procedure Act s.26(3)

Cases cited (2)

Ecta (U) Ltd v Geraldine S. Namirimu & Josephine Namukasa (Civil Appeal No. 29 of 1994)
Sietco v Noble Builders (U) Ltd (Civil Appeal No. 31 of 1995)

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.