Wakilii

HSGS Impex Ug Ltd v Bakama Enterprises Ltd & anor (Civil Suit No. 787 of 2014)

High Court · [2015] UGCOMMC 116 · 2015 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of contract of bailment following interlocutory judgment
Decision
Judgment entered for the plaintiff with special and general damages, interest, and costs

Observed later treatment

Cited — treatment unverified cited in 1 (treatment unverified) Sequitur — Uganda’s citator · Derived from citing cases in the Wakilii corpus — not an assertion that this case is good law.

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.

No adverse treatment recorded Cited 1 time with no adverse treatment recorded; not yet tested on the merits. Derived from citing cases in the Wakilii corpus — a deterministic signal, not legal advice.

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions—always read the source judgment before relying on it.

Holding

Held that when parties agreed to replace the initial contract of sale with an agreement requiring return of batteries, a contract of bailment arose under section 89 of the Contracts Act. The first defendant, as bailee, breached its obligation to return 705 cartons of batteries worth UGX 89,535,000. The second defendant, as guarantor under section 71 of the Contracts Act, was equally liable. Special damages of UGX 89,535,000 awarded for unreturned goods, general damages of UGX 10,000,000 for inconvenience, with interest and costs.

Outcome

Judgment entered for the plaintiff with special and general damages, interest, and costs

Facts

In 2013, the plaintiff supplied 910 cartons of batteries valued at UGX 115,570,000 to the first defendant on credit. The first defendant issued post-dated cheques exceeding UGX 20,000,000 each. The plaintiff requested fresh cheques or cash payment, which the second defendant (managing director) accepted but then disappeared. After locating the second defendant in Masindi, the parties executed a new written agreement for return of the batteries, with the second defendant guaranteeing performance. Five cheques totaling UGX 90,075,000 were issued as security. The plaintiff recovered only 205 cartons; the defendants failed to return 705 cartons worth UGX 89,535,000. The cheques were dishonored due to insufficient funds. The second defendant alleged the batteries were defective, but UNBS testing confirmed they met required standards. The defendants failed to file a defence, and interlocutory judgment was entered.

Issues

  1. Whether there was a contract of sale of goods between the plaintiff and first defendant.
  2. Whether the contract was breached by the first defendant.
  3. What remedies are available to the plaintiff.

Orders

  • Special damages of UGX 89,535,000 awarded, being the value of the 705 cartons of batteries the defendants failed to return.
  • General damages of UGX 10,000,000 awarded for loss and inconvenience suffered by the plaintiff.
  • Interest on special damages at 21% per annum from date of filing suit until payment in full.
  • Interest on general damages at 6% per annum from date of judgment until payment in full.
  • Costs of the suit awarded to the plaintiff.

Rules and key headnotes

Contract Law — Bailment — Formation by Agreement to Replace Sale Contract
Where parties to a contract of sale agree to dissolve that contract and enter into a new agreement requiring the return of goods to the original supplier, a contract of bailment arises under section 89 of the Contracts Act, with the original supplier becoming the bailor and the original purchaser becoming the bailee obligated to return the goods.
Contract Law — Bailment — Bailee's Obligation to Return Goods
Under section 99 of the Contracts Act, where by default of the bailee the goods are not returned, delivered or tendered at the proper time, the bailee is responsible to the bailor for any loss, destruction or deterioration of the goods from that time, and may be liable for the value of goods not returned.
Contract Law — Guarantee — Liability of Guarantor
Under section 71 of the Contracts Act, the liability of a guarantor is co-extensive with that of the principal debtor unless otherwise provided by contract, and takes effect upon default by the principal debtor. Where a guarantor personally guarantees performance of contractual obligations, the guarantor becomes equally liable for breach by the principal.
Damages & Quantum — Special Damages — Recovery for Unreturned Goods
In a breach of bailment contract where the bailee fails to return goods, the appropriate measure of special damages is the value of the goods not returned, rather than the value of dishonored security cheques issued to secure performance.
Damages & Quantum — General Damages — Inconvenience and Loss
General damages may be awarded for inconvenience which is not strictly physical and discomfort caused by breach of contract, including costs of locating an absconding party, blacklisting by bankers, and protracted deprivation of business, but the award must be commensurate with the actual loss suffered and not excessive.

Legislation cited (7)

Cases cited (10)

  • Sylvan Kakugu Tumwesigye vs. Trans Sahara International General TRDG LLC
  • Mutekanga v Equator Growers (U) Ltd [1995-1998] EA 205
  • Uganda Telecom Ltd v Tanzanite Corporation (Court of Appeal Civil Appeal No. 17 of 2004)
  • UCB v Kigozi [2002] 1 EA 305
  • Musisi Edward vs Babihuga Hild [2007] HCB Vol. 1 83 at Pp. 84
  • Robbialac Paints (U) Ltd vs. K.B Construction Ltd [1976] HCB 49
  • Ssemate v Seninde (High Court Civil Suit No. 409 of 2014)
  • Pica Printery and Stationery Ltd v Pallisa District Local Government (High Court Civil Suit No. 456 of 2006)
  • Arvinel v Kato and Another (High Court Civil Suit No. 394 of 2011)
  • Rwantale vs. Rwabutoga [1988-90] HCB 100

Cases citing this judgment (1)

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.

Full judgment

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

HSGS Impex Ug Ltd v Bakama Enterprises Ltd & anor (Civil Suit No. 787 of 2014) [2015] UGCommC 116 (19 August 2015)
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.