Ibero (U) Ltd v Mbale Importers and Exporters Ltd (Civil Appeal 10 of 2007)

Observed later treatment

No later-treatment classification is recorded for this judgment.

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 allowed the appeal and restored the trial judge's dismissal of the claim. It held that the respondent had not delivered the contracted coffee in accordance with the contract's conditions as to quality, moisture content, standards and date, so no claim for the price arose under the Sale of Goods Act. It further held that no contract of bailment arose: the security guard who admitted the tarpaulin-covered truck on a Sunday acted without actual or ostensible authority, and the appellant never accepted the coffee. The Court of Appeal had wrongly relied on the parties' past dealings and on a demand letter written by the respondent itself as an admission of liability, instead of properly reevaluating the evidence.

Outcome

Appeal allowed; Court of Appeal judgment set aside and the trial judge's dismissal of the respondent's claim restored.

Facts

The appellant, a Kampala coffee exporter, and the respondent, a Mbale coffee dealer, had a prior trading relationship. By a contract dated 3 December 1999 the respondent undertook to supply over 2,000 bags of coffee, deliverable to the appellant's Kampala warehouse by 17 December 1999. The contract made sale conditional on delivery within time, a maximum 13% moisture content, application of UCDA standards, and quality sampling of each type. The respondent claimed it delivered 650 bags. A tarpaulin-covered truck said to carry the coffee did not arrive at the appellant's gates until Sunday 19 December 1999, a non-working day on which coffee was never offloaded. A security guard admitted the truck out of sympathy for the driver, without authority; the driver kept the keys and left. The truck and its contents disappeared that night. The appellant never inspected or accepted any coffee. The respondent later wrote demanding that the appellant bear responsibility for the theft. The trial judge dismissed the claim; the Court of Appeal reversed and awarded the value of the coffee, general damages and interest.

Issues

1. Whether the respondent delivered the contracted coffee to the appellant's premises in accordance with the terms and conditions of the contract.
2. Whether any contractual relationship of bailment arose between the parties such that the appellant owed and breached a duty of care over the coffee.
3. Whether the Court of Appeal properly reevaluated the evidence in reversing the trial judge.
4. Whether the Court of Appeal erred in awarding general damages and interest.

Orders

• Appeal allowed.
• Judgment and orders of the Court of Appeal set aside.
• Findings and orders of the trial judge restored (the respondent's claim dismissed).
• Costs in the Supreme Court and in the courts below awarded to the appellant, with interest at 6%.

Rules and key headnotes

Legislation cited (2)

• Sale of Goods Act Cap 82 s.27
• Sale of Goods Act Cap 82 s.19(2)

Cases cited (9)

• Itostey v Hgman (1920) 3KB 475
• Armagas Ltd v Mundogas SA (1986) 2 All ER 385
• Wrightson v McArthur and Hutchinsons Ltd
• Universal Cargo Carriers Corporation v Citati (1957) 2 QB 436
• Iuuronge u Attorney General (1967) E.A. 17
• Uganda Limited u Tanzanite Corporation (2002) 2 EA 33
• Mutekanga v Equator Growers (U) Ltd [1995-1999] 2 EA 219
• United Garments Industry Ltd v Naco (Kampala) Ltd (1977) HCB 128
• Masembe v Sugar Corporation & Anor (2002) 2 EA 434

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