Wakilii

Lunco Constructors Ltd v Attorney General and Anor (HCT-00-CC-CS 318 of 2004)

High Court · [2006] UGCOMMC 3 · 2006 Plaint Struck Out AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit on preliminary point of law concerning privity of contract
Decision
Plaint struck out as against the first defendant; matter to proceed against the second defendant

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.

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 the plaintiff, as a sub-contractor, had no privity of contract with the first defendant and therefore no cause of action for breach of contract. The plaintiff's right to payment arose from the sub-contract with the second defendant, not from the main contract to which it was a stranger. The principle of novation did not apply where no fresh contract substituting the old one was established between the same parties. The plaint was struck out against the first defendant for failing to disclose a cause of action.

Outcome

Plaint struck out as against the first defendant; matter to proceed against the second defendant

Facts

The plaintiff, a construction company, was sub-contracted by the second defendant to perform work on the Luwero Town Water Supply Project. The main contract was between the first defendant (through the Ministry of Water, Lands and Environment) and the second defendant. The plaintiff imported materials which the Ministry paid for, but when the contract was terminated in December 2000 due to allegedly shoddy work, the first defendant refused to pay the plaintiff for work done, asserting there was no contract between them. The plaintiff sued to recover UGX 264,904,018 for work performed.

Issues

  1. Whether the plaintiff has a cause of action against the first defendant in circumstances where the plaintiff was not a party to the contract between the first defendant and the second defendant.
  2. Whether the principle of novation applied to create contractual privity between the plaintiff and the first defendant.
  3. Whether the plaint disclosed a cause of action against the first defendant.

Orders

  • Preliminary point of law allowed.
  • Plaint struck out as against the first defendant under Order 7 rule 11(a) of the Civil Procedure Rules.
  • Each party to bear its own costs.
  • Ruling to be delivered by the Registrar on a date to be fixed.
  • Scheduling conference to be fixed in respect of the claim against the second defendant.

Rules and key headnotes

Privity of Contract — Stranger to Contract — Right to Sue
A stranger to a contract cannot sue upon the contract unless given a statutory right to do so. Only a person who is a party to a contract can sue or be sued on it.
Assignment of Contractual Liabilities — Novation
The general rule is that liability under any contract cannot be assigned except with the consent of the other party to the contract, a situation known as novation. Novation occurs when parties to a contract enter into a fresh contract substituting it for the old one, thereby discharging the old one, and requires the same parties to agree that the old contract be abandoned in favour of the fresh one.
Sub-contracts — No Direct Contractual Relationship with Principal
Where a contractor sub-contracts work to a third party with the knowledge or consent of the principal, this does not create privity of contract between the principal and the sub-contractor. The sub-contractor's claim for payment lies against the contractor, not the principal, absent novation or assignment properly pleaded and proved.
Cause of Action — Elements Required
To disclose a cause of action, a plaint must show that the plaintiff enjoyed a right, that the right was violated, and that the defendant is liable for that violation. A plaint which does not disclose a cause of action must be struck out.

Legislation cited (1)

  • Civil Procedure Rules O.7 r.11(a)

Cases cited (2)

  • Auto Garage & Others v Motokov (No. 3) [1971] EA 514
  • Kayanja v New India Assurance Company Ltd [1968] EA 295

Full judgment

↓ Download PDF

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

Lunco Constructors Ltd v Attorney General and Anor (HCT-00-CC-CS 318 of 2004) [2006] UGCommC 3 (23 January 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.