Wakilii

Fredrick E. Ssempebwa and Another v Uganda Electricity Transmission Co. Limited (EDT COMPLAINT 20 of 2017)

Tribunal · [2018] UGEDT 7 · 2018 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Complaint before the Electricity Disputes Tribunal for compensation and interest on delayed payment for land taken for transmission line project
Decision
Consent judgment recorded with interest awarded on delayed compensation payment for compulsorily acquired land

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Tribunal held that claimants whose land was compulsorily acquired in 2011 for a transmission line project are entitled to interest on delayed compensation payments. Interest at 20% per annum was awarded on the original agreed sum of UGX 211,000,000 from April 2011 to judgment date, and on the inflation-adjusted sum of UGX 311,532,203.56 from judgment date to full payment. The Tribunal gave effect to a consent judgment adjusting the compensation for inflation and determined that interest compensates for deprivation of use of money.

Outcome

Consent judgment recorded with interest awarded on delayed compensation payment for compulsorily acquired land

Facts

The Claimants are registered proprietors of land in Kyadondo Block 111, Wakiso District. In 2011, part of their land (Plot 283) was taken by the Respondent for the Bujagali Implementation Project Transmission line. The Claimants proposed compensation of UGX 211,000,000 in April 2011, which the Respondent accepted and expressed willingness to pay. However, the Respondent took over the land but failed to pay the agreed compensation from 2011 until the Claimants filed a complaint in the Electricity Disputes Tribunal on 25 October 2017. The parties subsequently agreed to adjust the compensation for inflation to UGX 311,532,203.56 and recorded a consent judgment on 12 February 2018, leaving the question of interest and applicable rate to be determined by the Tribunal.

Issues

  1. Whether the Claimants are entitled to an award of interest on the sum UGX 311,532,203.56
  2. If the Claimants are entitled to interest, what is the applicable rate?

Orders

  • Consent judgment recorded and given effect.
  • Respondent to pay Claimants UGX 311,532,203.56 (being UGX 211,000,000 adjusted for inflation) in compensation for land at Kyadondo Block 111 Plot 283.
  • Interest at 20% per annum awarded on UGX 211,000,000 from April 2011 to the date of judgment.
  • Interest at 20% per annum awarded on UGX 311,532,203.56 from the date of judgment to full payment.
  • Each party to bear its own costs.

Rules and key headnotes

Compulsory Acquisition — Compensation — Interest on Delayed Payment
Where a party compulsorily acquires land and agrees to pay compensation but delays payment for several years, the affected landowner is entitled to interest on the compensation amount to compensate for deprivation of use of the money during the period of delay.
Interest — Nature and Purpose — Compensation for Deprivation of Use of Money
Interest is the cost of money and represents compensation paid for deprivation of the use of money. It may be regarded as representing the profit the creditor might have made if he had use of the money at the due date, or conversely, the loss suffered because he did not have that use.
Interest — Inflation Adjustment Distinguished from Interest
Inflation adjustment and interest are distinct concepts. Inflation relates to the purchasing power or time value of money, while interest relates to the cost of money. An inflation-adjusted compensation amount may still attract interest to compensate for deprivation of use during the period of delay.
Consent Judgments — Effect and Binding Nature
A consent judgment once recorded or endorsed by a court or tribunal becomes the judgment of that body and is binding upon the parties. Parties to proceedings are free to consent to judgment either orally before the tribunal, which then records the consent, or in writing.
Interest — Discretion of Court — Determination of Reasonable Rate
Under Section 26(2) of the Civil Procedure Act, a court or tribunal may in its discretion award interest on a decree for payment of money at such rate as it deems reasonable. In determining a reasonable rate, the tribunal may consider commercial bank lending rates and Central Bank base rates prevailing during the relevant period.

Legislation cited (2)

Cases cited (5)

  • BETUCO (U) Ltd and Another v Barclays Bank of Uganda and Others (Miscellaneous Application No. 243 of 2009)
  • Peter Muliira v Mitchell Cotts Ltd (Civil Appeal No. 15 of 2007)
  • Buladina Nankya & Anor versus Busio Konde 1979 HCB 239
  • Esero Kasule v Attorney General (Miscellaneous Application No. 688 of 2014)
  • Riches Versus Westminster Bank Ltd (1947) 1 ALLER 469

Full judgment

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

Fredrick E. Ssempebwa and Another v Uganda Electricity Transmission Co. Limited (EDT COMPLAINT 20 of 2017) [2018] UGEDT 7 (18 September 2018)
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.