Wakilii

Hexagon Agencies Ltd v Mogas International (U) Ltd (Civil Suit No. 282 of 2014)

High Court · [2016] UGCOMMC 216 · 2016 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of transportation charges and breach of contract
Decision
Plaintiff's claim allowed with damages and interest; Defendant's counterclaim dismissed as time-barred

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court held that the defendant wrongfully debited US$62,665.92 from the plaintiff's account for loss of petroleum products in a 2008 accident where no written agreement to deduct existed and no negligence by plaintiff was proven. The defendant's counterclaim was dismissed as time-barred under the Limitation Act. The exemption clause on consignment notes stating goods carried at owner's risk was incorporated into the contract and protected the plaintiff. The plaintiff was awarded US$70,036 plus interest at 10% per annum on sums withheld.

Outcome

Plaintiff's claim allowed with damages and interest; Defendant's counterclaim dismissed as time-barred

Facts

The plaintiff transported the defendant's petroleum products from Kenya to Uganda from early 2008. On 26 April 2008, the plaintiff's truck carrying 50,000 litres of defendant's fuel was involved in an accident, resulting in loss of 43,159 litres valued at US$62,083.42. The defendant ceased insurance cover for goods in transit in April 2007 without notifying plaintiff. Following email correspondence, plaintiff proposed 20% deductions from future invoices toward the loss and requested a written agreement, which was never executed. On 30 June 2009, defendant debited US$62,665.92 from plaintiff's account. Plaintiff claimed total outstanding amount of US$70,036 for transportation services. Defendant counterclaimed US$67,000 for loss of petroleum products due to non-delivery. The accident was allegedly caused by negligence of Kakira Sugar Works Ltd, a third party.

Issues

  1. Whether the counter-claim is time barred?
  2. Whether the debit of USD 70,036 was justified?
  3. Whether the Plaintiff is entitled to the remedies sought?
  4. Whether the counter-Defendant breached the transportation agreement executed with the counter-claimant?
  5. Whether the counter-claimant is entitled to the remedies sought?

Orders

  • The defendant's counterclaim is dismissed with costs for being barred by statute.
  • The Plaintiff is awarded the sum of US$70,036.
  • The Plaintiff is awarded interest on the sum of US$62,665.92 at the rate of 10% per annum from July 2012 till date of judgment.
  • The Plaintiff is awarded interest at 10% per annum on the sum of US$7,370.75 from the date of filing the suit on 28th April 2014 till date of judgment.
  • Interest is awarded on the aggregate decreed amount at the rate of 10% per annum till payment in full.
  • Costs of the suit are awarded to the Plaintiff.

Rules and key headnotes

Contract Law — Exemption Clauses — Incorporation into Contract of Carriage
An exemption clause printed in capital letters on a consignment note signed by both parties at the time of contract formation is incorporated as a term of the contract and binds the parties, even if one party did not read the clause, provided reasonable steps were taken to bring it to the attention of the other party.
Contract Law — Contract Formation — Requirement of Acceptance
Where parties negotiate proposed terms by email and one party explicitly requests a written agreement be signed before the terms become binding, no contract is concluded until that written agreement is executed, notwithstanding continued dealings between the parties.
Contract Law — Offer and Acceptance — Effect of Counter-offer
A counter-offer made in response to an original offer cancels the original offer, and where the original offeror thereafter restates its original proposal subject to execution of a written agreement which is never signed, no binding contract arises from the correspondence.
Civil Procedure — Limitation — Commencement of Limitation Period
In an action for loss arising from a road accident involving goods in transit, the cause of action accrues and the limitation period begins to run from the date of the accident, not from the date when the defendant refuses to pay or a subsequent reconciliation reveals disputed deductions.
Civil Procedure — Limitation — Counterclaim Filed Beyond Limitation Period
A counterclaim filed more than six years after the cause of action arose is barred by section 3(1)(a) of the Limitation Act, notwithstanding that the main suit was filed within the limitation period, and will be dismissed unless the counterclaimant pleads grounds for exemption under Order 7 rule 6 of the Civil Procedure Rules.
Contract Law — Exemption Clauses — Liability Requiring Proof of Negligence
An exemption clause limiting liability for goods carried at owner's risk does not render the carrier strictly liable; where a third party's negligence caused loss of goods in transit, the carrier is not liable to the owner in the absence of proof that the carrier was at fault.
Contract Law — Damages — Restitutio in Integrum and Interest
Interest on sums wrongfully withheld is awarded to fulfil the principle of restitutio in integrum, compensating the claimant for deprivation of use of money, representing either the profit that could have been made or the loss suffered from not having that use.

Legislation cited (7)

Cases cited (22)

  • Kamagara Charles v Uganda Railway Corporation (High Court Civil Suit No. 846 of 2005)
  • L'estrange v Graucob Ltd (1934) 2 KB 394
  • Akerib v Booth & Others Ltd [1961] 1 All ER 380
  • Eladam Enterprises Ltd v S.G.S (U) Ltd & others (Civil Appeal No. 20 of 2002)
  • Dada Cycles Ltd v Sofitra S.P.R.L Ltd (High Court Civil Suit No. 656 of 2005)
  • Ronald Kasibante v Shell Uganda Ltd (High Court Civil Suit No. 542 of 2006)
  • Madhvani Group Limited v Simbwa & Others (High Court Civil Suit No. 615 of 2012)
  • ZTE Corporation v Uganda Telecom (Civil Suit No. 169 of 2013)
  • NAS Airport Services Limited v The Attorney General of Kenya (1959) 1 EA 53
  • National Council of Sports v Peter Grace Seruwagi (Miscellaneous Application No. 305 of 2003)
  • Cartledge & Others v E. Jopling & Sons Ltd (1963) AC 756
  • Clovergem Fish and Foods Ltd (in receivership) v John Verje and another (Court of Appeal Civil Appeal No. 20 of 2001)
  • Suresh Chandra A. Ghelani v Chandrakant Patel (Court of Appeal Civil Appeal No. 56 of 2004)
  • Gameca & Another v Steel Rolling Limited (High Court Civil Suit No. 228 of 2006)
  • Kampala District Land Board and George Mitala v Venansio Babweyana (Civil Appeal No. 2 of 2007)
  • Hajji Asuman Mutekanga vs. Equator Growers Limited
  • Parry v Cleaver [1967] 2 All ER 1168
  • Parry v Cleaver [1969] 1 All ER 555
  • Olley v Marlborough Court Ltd [1949] 1 All ER 127
  • Dharamshi v Karsan [1974] 1 EA 41
  • Johnson and another v Agnew [1979] 1 All ER 883
  • Riches v Westminster Bank Ltd [1947] 1 All ER 469

Full judgment

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Hexagon Agencies Ltd v Mogas International (U) Ltd (Civil Suit No. 282 of 2014) [2016] UGCommC 216 (16 December 2016)
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.