Wakilii

Brookside Limited v Rainbow Dairy Uganda Limited (Civil Suit 915 of 2025)

High Court · [2026] UGCOMMC 340 · 2026 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 with interlocutory judgment entered following defendant's failure to file defence; matter proceeded to formal proof
Decision
Judgment entered for plaintiff for principal sum of UGX 105,602,000 plus general damages of UGX 15,000,000 with interest and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

In a commercial credit supply dispute, the High Court held that where an interlocutory judgment has been entered following the defendant's failure to file a defence, liability is settled and the court proceeds to assess damages. The plaintiff proved breach of a credit agreement for milk products worth UGX 105,602,000. The court awarded the principal sum, general damages of UGX 15,000,000 for commercial inconvenience, interest at 12% per annum on the principal from the date of default, interest at 6% per annum on general damages from the date of judgment, and costs.

Outcome

Judgment entered for plaintiff for principal sum of UGX 105,602,000 plus general damages of UGX 15,000,000 with interest and costs

Facts

The parties entered into a credit supply agreement on 18 January 2024 whereby the plaintiff would supply milk products to the defendant on 30-day credit terms with a limit of UGX 100,000,000. Between August and October 2024, the plaintiff delivered multiple consignments of skimmed milk powder and full cream powder. By 17 October 2024, the defendant's debt reached UGX 108,850,000, exceeding the credit limit and the payment window. Despite a demand letter on 6 January 2025 and a written acknowledgment on 24 February 2025 promising payment by 31 March 2025, the defendant made only one partial payment of UGX 3,248,000 on 12 January 2025, leaving UGX 105,602,000 outstanding. The plaintiff filed suit on 25 July 2025. Summons were served on 26 September 2025 but the defendant filed no defence. An interlocutory judgment was entered on 17 December 2025.

Issues

  1. Whether the plaintiff is entitled to general damages for breach of contract.
  2. Whether the plaintiff is entitled to interest and costs.

Orders

  • Declaration made that the Defendant is in breach of contract for failing to settle outstanding indebtedness for milk products supplied on credit between August and October 2024.
  • Defendant ordered to pay Plaintiff the principal sum of UGX 105,602,000.
  • Defendant to pay Plaintiff UGX 15,000,000 as general damages for breach of contract and commercial inconvenience.
  • Interest awarded on the principal sum at 12% per annum from the date of default until payment in full.
  • Interest awarded on general damages at 6% per annum from the date of judgment until payment in full.
  • Plaintiff awarded costs of the suit.

Rules and key headnotes

Breach of Contract — Definition and Elements — Failure to Fulfil Contractual Obligations
Breach of contract occurs where one or both parties fail to fulfil the obligations imposed by the terms of the contract. Where a party fails to pay for goods supplied within agreed timelines, a clear breach of contractual terms is established.
Interlocutory Judgment — Effect on Liability — Closure of Question of Liability
Once an interlocutory judgment is entered, the issue of liability is settled and cannot be reopened at the stage of formal proof. The court proceeds only to determine the extent of the plaintiff's entitlement to damages, interest, and costs.
General Damages — Breach of Contract — Commercial Inconvenience — Compensatory Nature
General damages for breach of contract are compensatory in nature and should restore some satisfaction, as far as money can do it, to the injured plaintiff. In commercial contexts, damages account for commercial inconvenience, including deprivation of capital that could have been reinvested during the period of the defendant's default.
General Damages — Assessment — Factors Considered — Duration of Default and Commercial Disruption
In assessing general damages for breach of a commercial credit agreement, the court considers the duration of the default, the volume of products supplied, broken promises to pay, and the commercial disruption caused by frozen cash flow. The plaintiff must prove that it suffered loss and damage beyond the mere debt itself.
Interest — Discretionary Award — Guiding Principles — Commercial Context
Under Section 26(2) of the Civil Procedure Act, the court has discretion to award interest at such rate as it deems reasonable on the principal sum adjudged. In commercial disputes, interest compensates the plaintiff for being deprived of the use of its funds during the period of default. The rate must be just and reasonable, insulating the plaintiff against inflation and currency depreciation while reflecting the loss of utility of capital.
Costs — Entitlement — Costs Follow the Event — Contractual Agreement to Pay Legal Fees
Under Section 27(2) of the Civil Procedure Act, costs follow the event unless the court for good reason otherwise orders. Where the parties' credit agreement expressly provides that the defaulting party shall pay all costs of collection or legal fees necessitated by non-payment, and the plaintiff succeeds, the defendant is held to this contractual undertaking and ordered to pay costs.

Legislation cited (11)

Cases cited (9)

  • Nakawa Trading Co. Ltd v Coffee Marketing Board (Civil Suit No. 137 of 1991)
  • William Kasozi v DFCU Bank Ltd (High Court Civil Suit No. 1326 of 2000)
  • Hajji Asumani Mutekanga v Equator Growers (U) Ltd (Supreme Court Civil Appeal No. 7 of 1995)
  • Kirungi & Another Vs Kabiya & Others KLR 347
  • Daniel Kagame Ndahiro v Kamanzi Kaijuka (Civil Suit No. 694 of 2024)
  • Swarna Garikapati v Abhayamm Health Care Africa Limited (Civil Suit No. 317 of 2025)
  • Takiya Kashwahiri & Another v Kajungu Denis (Court of Appeal Civil Appeal No. 85 of 2011)
  • Milly Masembe v Sugar Corporation (U) Ltd and Another (Supreme Court Civil Appeal No. 1 of 2000)
  • Uganda Development Bank Vs Muganga Construction Co. Ltd HCB 35

Full judgment

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

Brookside Limited v Rainbow Dairy Uganda Limited (Civil Suit 915 of 2025) [2026] UGCommC 340 (19 May 2026)
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.