Wakilii

Combined Services Ltd v Attorney General (HCT-00-CC-CS 939 of 2004)

High Court · [2008] UGCOMMC 13 · 2008 Judgment for Plaintiff with Counterclaim Partly Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of contract with counterclaim
Decision
Plaintiff awarded sums due under Ntungamo contract plus general damages, but subject to offset. Defendant awarded recovery of advance payment under Luwero contract in counterclaim.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that the plaintiff was entitled to US$11,021 and US$23,548 under the Ntungamo contract as payment was not proved, plus general damages of US$5,000 and interest at 4% per annum. However, the US$23,548 was subject to offset against the defendant's counterclaim for recovery of advance payment of UGX 41,306,428 under the Luwero contract, where the plaintiff had failed to complete the works. The defendant's counterclaim was not an abuse of process despite being substantially the defence in related proceedings.

Outcome

Plaintiff awarded sums due under Ntungamo contract plus general damages, but subject to offset. Defendant awarded recovery of advance payment under Luwero contract in counterclaim.

Facts

The plaintiff contracted with the Government of Uganda on 20 May 1999 to construct water supply systems in Ntungamo Town. After substantial completion, two sums remained outstanding: US$23,548 under Payment Certificate No. 14 (dated 13 July 2000) and US$11,021 retention money under Payment Certificate No. 15 (dated 15 August 2000). The defendant claimed to have paid the US$11,021 by telegraphic transfer to the plaintiff's UCB account No. 655 on 19 April 2002, but the plaintiff produced a company resolution showing that account was closed on 15 November 2000. The defendant counterclaimed for recovery of advance payment of UGX 41,306,428 and UGX 5,064,918 completion costs under a separate Luwero contract, where the plaintiff had received 20% advance payment but failed to complete works, leading to termination. The defendant sought to offset the Ntungamo payments against the Luwero claim.

Issues

  1. Whether US$11,021 was paid to the plaintiff and if not, whether the same is due to the plaintiff.
  2. Whether US$23,548 due to the plaintiff can be offset against the defendant's claim under the contract for Luwero Water Supply System.
  3. Whether the plaintiff is entitled to interest and damages.
  4. Costs.

Orders

  • US$11,021 awarded to the plaintiff with interest at 4% per annum from 29 November 2001 until payment in full.
  • US$23,548 awarded to the plaintiff with interest at 4% per annum from 11 August 2000, subject to offset against the defendant's counterclaim.
  • General damages of US$5,000 awarded to the plaintiff with interest at 4% per annum from the date of judgment until payment in full.
  • Costs of the main suit awarded to the plaintiff.
  • UGX 41,306,428 awarded to the defendant in the counterclaim, if not already paid, with interest at 24% per annum from 15 January 2001 until payment in full.
  • Half of the costs of the counterclaim awarded to the defendant.
  • Defendant's claim for UGX 5,064,918 as special damages dismissed for lack of proof.

Rules and key headnotes

Breach of Contract — Burden of Proof of Payment — Banking Evidence
Where a defendant alleges payment of a contractual sum by bank transfer to a specified account but the plaintiff produces evidence that the account was closed before the alleged transfer date, the defendant bears the burden of proving that payment was actually received and cannot rely solely on evidence of instructing the transfer.
Set-off — Related Contracts Between Same Parties
Where parties have entered into multiple related contracts and there are cross-claims arising from different contracts, the court may permit set-off of sums due under one contract against claims under another contract between the same parties, provided the claims are established.
Advance Payment — Recovery — Insurance Bond — Primary Obligation of Contractor
Where a contractor receives advance payment under a construction contract secured by an insurance guarantee bond and fails to complete the works, a claim by the employer against the insurance guarantor is primarily a claim against the contractor as principal, and the contractor retains primary obligation to refund the advance payment if the guarantor fails to pay.
Counterclaim — Abuse of Process — Related Proceedings — Section 33 Judicature Act
A counterclaim that substantially reflects the defence in related proceedings between the same parties is not an abuse of process where it serves to completely and finally determine the parties' disputes without multiplicity of proceedings within the meaning of Section 33 of the Judicature Act, particularly where the related case does not itself contain a counterclaim.
Special Damages — Burden of Proof — Completion Costs
Where a party claims special damages representing the cost of engaging another contractor to complete unfinished works, such special damages must be specifically proved by evidence showing how the amount was calculated and incurred, and will be dismissed if no such evidence is adduced.
Interest on Late Payment — Commercial Borrowing Rate
Where a construction contract provides for interest on late payments at the prevailing rate for commercial borrowing for the relevant currency, the court will apply a rate appropriate to that currency rather than domestic lending rates, and will assess what constitutes a reasonable commercial borrowing rate for the currency in question.

Legislation cited (2)

Cases cited (1)

  • Combined Services Ltd v Attorney General (HCCS No. 657 of 2003)

Full judgment

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

Combined Services Ltd v Attorney General (HCT-00-CC-CS 939 of 2004) [2008] UGCommC 13 (13 February 2008)
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.