Wakilii

Lukyamuzi James v Akright Project Ltd & Anor (High Court Civil Suit No. 319 of 2002)

High Court · [2004] UGCOMMC 23 · 2004 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of brokerage commission
Decision
Plaintiff awarded Shs.5 million with interest and costs against the 1st Defendant. 2nd Defendant removed from the suit.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that a company director who acted in the company's name is not personally liable for the company's obligations, applying the principle in Salomon v Salomon that a limited liability company is a separate legal entity from its directors. The 2nd Defendant's name was struck out. On the merits, the court found the Plaintiff had established he was instructed to find land, did find the land purchased by the 1st Defendant company, and was entitled to the agreed Shs.5 million brokerage commission retained under the sale agreement.

Outcome

Plaintiff awarded Shs.5 million with interest and costs against the 1st Defendant. 2nd Defendant removed from the suit.

Facts

In September 2001, the 1st Defendant company purchased land in Mutungo from Zaverio Kasawali for Shs.55 million. The sale agreement provided that the buyer would retain Shs.5 million from the purchase price to pay commission to brokers. The Plaintiff claimed he was the broker who found the land for the 1st Defendant and was entitled to the Shs.5 million commission. The Plaintiff testified that the 2nd Defendant, a director of the 1st Defendant company, instructed him to find land. The Plaintiff, working through intermediaries Mwijuke and Atugonza, located the property and introduced the vendor to the 2nd Defendant. Subsequently, another broker (Latif Ssemujju, an employee of the 1st Defendant) took over negotiations and the sale was completed without the Plaintiff's further involvement. The 1st Defendant paid the vendor Shs.50 million and retained the Shs.5 million but refused to pay the Plaintiff. The 1st Defendant denied any agreement with the Plaintiff and claimed Latif Ssemujju was the entitled broker.

Issues

  1. Whether the 2nd Defendant instructed the Plaintiff to look for land for the 1st Defendant
  2. Whether the Plaintiff found plot 321 at Mutungo for the 1st Defendant
  3. Whether any commission was due to the Plaintiff and if so, how much
  4. Whether the Plaintiff is entitled to the Shs.5m claimed
  5. Whether the 2nd Defendant was properly joined as a party to the suit

Orders

  • The 2nd Defendant's name is struck out from the suit with costs.
  • Judgment entered in favour of the Plaintiff against the 1st Defendant for Shs.5,000,000.
  • Interest awarded at 18% per annum from the date of filing suit until payment in full.
  • Costs of the suit awarded to the Plaintiff.

Rules and key headnotes

Company Law — Separate Legal Personality — Director Not Personally Liable
A limited liability company is a separate legal person from its shareholders and directors. A director who acts in the company's name and on its behalf is not personally liable for the company's obligations, even where the director is the sole controller or beneficial owner of the company.
Contract Law — Agency and Brokerage — Right to Commission
A broker who is instructed to find property, locates suitable property, and introduces the parties who subsequently conclude a sale is entitled to the agreed commission, even if other intermediaries complete the transaction and the broker is excluded from final negotiations.
Evidence — Burden of Proof — Balance of Probabilities in Civil Cases
In civil proceedings, the party who alleges a fact must prove it on the balance of probabilities. Where witnesses give conflicting testimony, the court may resolve credibility issues by assessing demeanour and the inherent probability of each version.
Civil Procedure — Parties — Misjoinder of Parties
A company director sued in his personal capacity for acts done in the name and on behalf of the company is improperly joined. The director's name should be struck out where the contract and all acts complained of relate to the company as a separate legal entity.

Legislation cited (2)

Cases cited (1)

  • Salomon v Salomon [1897] AC 22

Full judgment

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

Lukyamuzi James v Akright Project Ltd & Anor (High Court Civil Suit No. 319 of 2002) [2004] UGCommC 23 (23 August 2004)
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.