Wakilii

Impact Solution Ltd v Alarm Group Ltd and Anor - (HCT-00-CC-CS 408 of 2002)

High Court · [2006] UGCOMMC 10 · 2006 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of money under an advertisement contract
Decision
Judgment entered for the Plaintiff against the 1st Defendant for UGX 4,500,000 with interest and costs; 2nd Defendant not personally liable

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that where a managing director refers a matter to a subordinate employee after agreeing in principle, the employee's instructions bind the employer under agency principles and the employee is not personally liable. Where the employer designs artwork and provides it to the publisher, and fails to lead evidence disputing the invoice or challenging approval, the employer is liable for payment. Judgment for plaintiff for UGX 4,500,000 with interest from date of amendment claiming interest.

Outcome

Judgment entered for the Plaintiff against the 1st Defendant for UGX 4,500,000 with interest and costs; 2nd Defendant not personally liable

Facts

The Plaintiff contracted with the Defendants to place an advertisement on the Plaintiff's celebrity shopper's year planner for UGX 9,000,000. PW1 Mirembe Julius testified that he had discussions with the 1st Defendant's Managing Director who agreed in principle and referred the matter to the 2nd Defendant, an employee. The 2nd Defendant placed an order. The 1st Defendant's Public Relations Department designed the artwork which the Plaintiff published. The year planner was produced but the Defendants did not pay. The Defendants denied that the 2nd Defendant had authority to conclude the contract and claimed they had not approved the artwork, which they said was substandard. The Defendants participated through counsel until close of the Plaintiff's case but led no evidence in defence despite court warning under Order 15 rule 4 of the Civil Procedure Rules.

Issues

  1. Whether the 2nd Defendant's instructions bound the 1st Defendant.
  2. Whether the 2nd Defendant can be held personally liable on the order.
  3. Whether the Defendants had to approve the art work and design before publication.
  4. Whether the advert published by the Plaintiff was unilateral and substandard.

Orders

  • Judgment for the Plaintiff against the 1st Defendant for UGX 4,500,000.
  • Interest at 25% per annum on the principal sum from 29 April 2005 until payment in full.
  • Costs of the suit to the Plaintiff.
  • Interest on costs at court rate from the date of taxation until payment in full.

Rules and key headnotes

Agency — Authority of Employee — Apparent Authority
Where a managing director agrees in principle to a transaction and refers the matter to a subordinate employee for execution, that employee has authority to conclude the contract on behalf of the employer, and the contract becomes that of the employer as principal.
Agency — Personal Liability of Agent
An agent acting within the scope of his authority on behalf of his principal is not personally liable on the contract concluded, as the principle of law is that he who does something through another does it himself.
Burden of Proof — Unchallenged Evidence — Failure to Lead Defence
In a civil suit where a party adduces evidence sufficient to raise a presumption that what is asserted is true, the burden shifts to the opponent to adduce evidence to rebut the presumption. Where a defendant fails to lead evidence in defence, the plaintiff's unchallenged evidence is accepted as truthful.
Commercial Contracts — Approval of Artwork — Defence of Substandard Performance
Where a party claims that work performed under a contract was substandard but fails to raise the complaint when payment was first demanded and leads no evidence to substantiate the claim, such a defence is treated as an afterthought and rejected.
Interest — Discretionary Remedy — Amendment of Pleadings
Interest, unless part of the contract terms, is a discretionary remedy. The general rule is that interest can only be claimed if the claim is based on an agreement for it in the document sued upon or by statute. Where interest is claimed by amendment to the plaint, it shall be calculated from the date the amended plaint claiming interest was filed.

Legislation cited (1)

  • Civil Procedure Rules O.15 r.4

Full judgment

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

Impact Solution Ltd v Alarm Group Ltd and Anor - (HCT-00-CC-CS 408 of 2002) [2006] UGCommC 10 (2 April 2006)
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.