Goustar Enterprises Ltd v John Kokas Oumo (Civil Appeal 8 of 2003)

Observed later treatment

Citator coverage is limited to judgments in the Wakilii corpus and source-matched treatment records. Absence of a signal is not an assertion that the case remains good law.

Holding

The Supreme Court dismissed Goustar's second appeal. Where a buyer makes known the particular purpose for which goods are required and relies on the seller's skill and judgment, the Sale of Goods Act implies a condition that the goods be reasonably fit for that purpose. Two of three supplied tractors were defective on testing — one overheating, the other with a hydraulic fault — so the implied condition was breached. The breach went to a condition, not a warranty, so the buyer was entitled to reject; he had not accepted the goods, having had no reasonable opportunity to examine them before testing. No relief could be granted for unpleaded repair costs. The Court of Appeal's refund and damages awards stood.

Outcome

Appeal dismissed; the Court of Appeal's orders stand, leaving the respondent entitled to a refund of Shs 18,355,120 with interest and Shs 5,000,000 general damages

Facts

Goustar Enterprises entered a memorandum of understanding with the Uganda National Farmers Association to supply tractors to members. The respondent, a member, ordered three tractors with implements at a total price of Shs 105,679,140 plus tax, and paid a 50% deposit of Shs 53,584,500. The tractors were supplied in July 1997 and kept at the respondent's home awaiting testing. When tested in the presence of the appellant's agent about two months later, two of the three tractors proved defective — one overheated, the other had a hydraulic fault preventing the plough from engaging — while the third worked. The respondent rejected the two defective tractors and the appellant took them away. The appellant said they were taken for repair; the respondent said he had rejected them. The appellant had given a 12-month warranty. When the parties failed to agree, the respondent sued in the High Court for a refund of the sums deposited towards the purchase of the tractors.

Issues

1. Whether the defects in the tractors existed at delivery or developed while the goods were in the buyer's possession, and on whom the burden of proof lay.
2. Whether the buyer rejected the tractors or merely returned them for repair.
3. Whether there was an implied condition that the tractors be reasonably fit for the buyer's particular purpose under the Sale of Goods Act.
4. Whether the breach was of a condition entitling the buyer to reject the goods or of a warranty entitling only a claim for damages.
5. Whether the Court of Appeal's computation of the refund was correct and whether relief could be granted on repair costs that were not pleaded.

Orders

• Appeal dismissed.
• Costs of the appeal awarded to the respondent in the Supreme Court and in the courts below.

Rules and key headnotes

Legislation cited (8)

• Sale of Goods Act s.34 (formerly s.35)
• Sale of Goods Act s.15 (formerly s.16)
• Sale of Goods Act s.15(1)(a)
• Sale of Goods Act s.1(o)
• Civil Procedure Rules Order XB Rule 1(1)(b)
• Civil Procedure Rules Order 13 Rule 1(5)
• Rules of the Court of Appeal Rule 29(1)
• Civil Procedure (Amendment) Rules 1998 (SI 1998 No. 26)

Cases cited (12)

• Banco Arabe Espanyol v Bank of Uganda (Civil Appeal No. 8 of 1998)
• Habre International Co. Ltd v Abraham Alayakha & Others (Civil Appeal No. 4 of 1998)
• Muluta Joseph v Katama Sylvano (Civil Appeal No. 11 of 1999)
• Kifamunte Henry v Uganda (Criminal Appeal No. 10 of 1997)
• Pandya v R (1957) EA 366
• Bogere Charles v Uganda (Criminal Appeal No. 10 of 1998)
• Kinyanjui v D T Dobie & Co. (Kenya) Ltd [1975]
• Sugar Corporation of Uganda Ltd v Lawsam Chemical (U) Ltd (Civil Appeal No. 5 of 2001)
• Manchester Liners v Rea [1922] 2 AC 14
• Kampala General Agency 1942 Ltd v Mody's EA Ltd [1963] EA 549
• Candy v Caspair Air Charter Ltd [1956] EACA 139
• Francis Sembuya v AllPorts Services (U) Ltd (Civil Appeal No. 6 of 1999)

Cases citing this judgment (5)

How later Ugandan judgments in the Wakilii corpus have cited this case. Treatment labels come from Sequitur — Uganda’s citator — each backed by a verbatim span from the citing judgment, and are not an assertion that this case is, or is not, good law.

• Charles Bagalana and Others v Kigenyi Abdalla and Another (Civil Appeal 2 of 2023)
• Begumya Naphtal and Kyokusiima Lilian v Tumushabe Jonah and Others (Civil Appeal No. 199 of 2021)
• Multiple ICD(U) Limited v Jaco Commercial Agencies Limited (Civil Appeal No.125 of 2020)
• Uganda Management Institute Governing Council and Another v Dr. Benon Basheka (Civil Appeal No. 97 of 2013)
• Uganda Management Institute Governing Council and Another (Civil Appeal 97 of 2013)

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