Wakilii

Bob Humphrey Ogwang v Jas Progressive Investments (HCT-00-CC-CS 747 of 2004)

High Court · [2007] UGCOMMC 30 · 2007 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of contract arising from sale of land
Decision
Plaintiff awarded refund of purchase price plus general damages with interest and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that where a defendant's appointed agent enters into a sale agreement for land and the defendant's managing director signs the agreement acknowledging receipt of the purchase price, the defendant is bound by the agent's acts. The parol evidence rule prevents the defendant from denying terms in the signed written contract. The plaintiff was entitled to refund of the purchase price as money paid for consideration which wholly failed when evicted by the mortgagee bank, plus general damages, but special damages for construction costs were disallowed for lack of proof.

Outcome

Plaintiff awarded refund of purchase price plus general damages with interest and costs

Facts

The plaintiff purchased land from the defendant for UGX 15,000,000 pursuant to a sale agreement dated 25 June 2003. The defendant's agent, Property Masters, advertised 20 plots at Nambole for sale in the New Vision newspaper. The plaintiff paid the purchase price to the agent, and the defendant's managing director signed the sale agreement acknowledging receipt. The agreement described the land as Block 232 Plots 1496 and 1497. The plaintiff commenced construction on the property. In June 2004, approximately one year later, the plaintiff was evicted by auctioneers acting for Tropical Africa Bank after the defendant defaulted on mortgage obligations. Unknown to the plaintiff at the time of purchase, Plot 1497 was subject to a mortgage to the bank. The plaintiff abandoned the partially completed buildings and demanded refund and compensation.

Issues

  1. Whether the defendant and/or its agent sold the suit property to the plaintiff.
  2. Whether the plaintiff is entitled to the remedies sought.

Orders

  • Judgment entered for the plaintiff against the defendant.
  • Special damages awarded: UGX 15,000,000 (refund of purchase price).
  • General damages awarded: UGX 12,000,000.
  • Interest on both awards at 23% per annum from date of judgment until payment in full.
  • Costs of the suit awarded to the plaintiff.

Rules and key headnotes

Agency — Authority of Agent — Principal Bound by Agent's Acts
Where a principal appoints an agent to sell property and the agent enters into a written sale agreement on behalf of the principal, the principal is bound by the agent's acts even if the agent exceeded his authority, provided there is no evidence of revocation of the agent's authority before the plaintiff abandoned the property and demanded reimbursement. The contract concluded by the agent and the purchaser becomes that of the principal and the purchaser, as he who does something through another does it himself.
Parol Evidence Rule — Written Contracts — Exclusion of Extrinsic Evidence
The parol evidence rule prevents a party to a written contract from adducing evidence to add to, vary, or contradict the written instrument. Where a managing director personally signs a sale agreement acknowledging receipt of the purchase price and describing the property sold, he cannot later deny offering such land to the purchaser or receiving payment. He is estopped by the parol evidence rule from contradicting the terms of the written contract.
Breach of Contract — Total Failure of Consideration — Refund of Purchase Price
Where a purchaser of land pays the purchase price but is subsequently evicted by a mortgagee bank because the property was subject to a mortgage at the time of sale, the purchaser is entitled to a refund of the purchase price as money paid for consideration which has wholly failed.
Special Damages — Pleading and Proof — Strict Proof Required
Special damages must be pleaded and strictly proved by the party claiming them. Where a plaintiff tenders a valuation report as evidence of special damages for construction costs and increased land value but fails to call the authors of the report to testify at the hearing, the plaintiff has not discharged the burden of proof and the claim for special damages must be disallowed.
General Damages — Assessment — Mitigation of Loss
In assessing general damages for breach of contract in a land sale, the court must make due allowance for the plaintiff's failure to mitigate loss by rejecting an offer of an alternative plot elsewhere. The court may award a sum lower than the special damages claimed but adequate to compensate for the breach and attendant loss suffered.
Sale of Land — Caveat Emptor — Purchaser's Duty of Inquiry
In cases of sale of land, while a purchaser is entitled to go to the vendor for information, bearing in mind the principle of caveat emptor he is bound to make proper inquiries for himself. However, where plots are being re-subdivided and there is no evidence that the purchaser was alerted before the sale about one of the plots being subject to a mortgage, the purchaser who makes a search in respect of one plot cannot be faulted for not searching the other, having done what he could diligently have done in the circumstances.

Cases cited (1)

  • Prajapat v Ashok Cotton Co Ltd [1964] EA 309

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Bob Humphrey Ogwang v Jas Progressive Investments (HCT-00-CC-CS 747 of 2004) [2007] UGCommC 30 (4 April 2007)
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.