Wakilii

Hared Petroleum Limited v Uganda National Roads Authority (Civil Suit 1080 of 2020)

High Court · [2023] UGCOMMC 238 · 2023 Preliminary Objection Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Preliminary objection on limitation in breach of contract suit
Decision
Matter to proceed to trial on the merits

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

A preliminary objection that a breach of contract suit was time barred was dismissed. Although unpaid invoices dated from 2013-2014, the parties executed a Memorandum of Understanding on 7 January 2015 acknowledging the debt. Under Section 22(4) of the Limitation Act, acknowledgement of a claim creates a fresh accrual of action from the date of acknowledgement. Since the suit was filed on 17 December 2020, within six years of the 7 January 2015 acknowledgement, it was not time barred.

Outcome

Matter to proceed to trial on the merits

Facts

The plaintiff sued the defendant for UGX 2,710,517,032 for breach of contracts to supply fuel and petroleum products based on invoices from 2013 and 2014. The parties executed a Memorandum of Understanding on 7 January 2015 wherein the defendant acknowledged indebtedness totaling not more than UGX 17,334,999,112. After the suit was filed on 17 December 2020, the parties entered partial consent for UGX 833,510,944, leaving a contested balance of UGX 1,841,642,643. The defendant raised a preliminary objection that claims dating from 2010-2014 were time barred under the six-year limitation period in Section 3(a) of the Limitation Act.

Issues

  1. Whether the suit is time barred under Section 3(a) of the Limitation Act when brought after six years from the date invoices became due.
  2. Whether Section 22(4) of the Limitation Act applies to create a fresh accrual of action based on acknowledgement of debt or part payment.

Orders

  • Preliminary objection dismissed.
  • Suit to proceed to hearing on its merits.
  • Costs in the cause.

Rules and key headnotes

Limitation of Actions — Fresh Accrual — Acknowledgement of Debt
Where a right of action has accrued to recover a debt and the person liable acknowledges the claim or makes payment in respect of it, the right shall be deemed to have accrued on and not before the date of acknowledgement or last payment, creating a fresh limitation period from that date.
Breach of Contract — Limitation Period — Effect of Memorandum of Understanding Acknowledging Debt
A Memorandum of Understanding executed after unpaid invoices became due, in which the debtor acknowledges the debt, operates as an acknowledgement under Section 22(4) of the Limitation Act and creates a fresh six-year limitation period running from the date of the acknowledgement, not from the date of the original invoices.

Legislation cited (3)

Full judgment

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

Hared Petroleum Limited v Uganda National Roads Authority (Civil Suit 1080 of 2020) [2023] UGCommC 238 (18 October 2023)
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.