Wakilii

Lutale v Ssegawa (HCT-00-CC-CS 292 of 2006)

High Court · [2008] UGCOMMC 14 · 2008 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 and refund of purchase price
Decision
Judgment entered for the plaintiff with orders for refund of purchase price, general damages, interest, and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that the defendant breached the sale agreement by failing to install and test the copier-printing machine, delivering a machine that was not in good working condition, and failing to refund the purchase price despite contractual guarantee. The machine was found to be obsolete scrap, breaching the implied conditions of fitness for purpose and merchantable quality under the Sale of Goods Act. Plaintiff entitled to refund of purchase price plus penalty, general damages, and costs.

Outcome

Judgment entered for the plaintiff with orders for refund of purchase price, general damages, interest, and costs

Facts

On 15 January 2004, the plaintiff and defendant entered a sale agreement for a Canon NP 9120 Copier-Printing machine for Shs.15,000,000. The plaintiff paid the full purchase price immediately upon execution. Under the agreement, the defendant undertook to install and test the machine at the plaintiff's premises at his own cost and guaranteed the machine was in good working condition. The agreement further provided that if the machine was found faulty, the defendant would refund the full consideration plus 10% penalty. The machine failed to work from the outset. An expert engineer examined it and found the power supply unit, diskettes, and other components faulty. The serial number had been scrapped off. She assessed it as obsolete scrap already written off the market, with spares difficult to obtain. Despite multiple letters demanding refund, the defendant refused. The plaintiff terminated the contract and brought suit for refund, penalty, and damages.

Issues

  1. Whether there was non-performance of the contract by the parties and if so, by whom?
  2. Whether the plaintiff is entitled to the reliefs sought.

Orders

  • Special damages of Shs.16,500,000 awarded.
  • General damages of Shs.5,000,000 awarded.
  • Interest on special damages at 25% per annum from date of filing suit until payment in full.
  • Interest on general damages at 25% per annum from date of judgment until payment in full.
  • Defendant to remove the machine from plaintiff's premises within ten days at own cost or forfeit it to the plaintiff.
  • Costs of the suit awarded to the plaintiff.
  • Suit allowed to the extent indicated.

Rules and key headnotes

Contract Law — Conditions and Warranties — Distinction Between Major and Minor Terms
A condition is the major term of a contract and is so important that, if broken, the injured party may refuse to go on with the contract. A warranty is a less vital term; if broken, the injured party will still have to go on with the contract but may be compensated by an award of damages.
Contract Law — Sale of Goods — Implied Condition of Fitness for Purpose
Under section 15 of the Sale of Goods Act, where the buyer expressly or by implication makes known to the seller the particular purpose for which goods are required so as to show reliance on the seller's skill or judgment, and the goods are of a description which it is in the course of the seller's business to supply, there is an implied condition that the goods shall be reasonably fit for the purpose. Breach of this implied condition entitles the buyer to reject the goods and demand refund of the price.
Contract Law — Sale of Goods — Implied Condition of Merchantable Quality
Under section 15(b) of the Sale of Goods Act, there is an implied condition that goods sold are of merchantable quality. Goods are of unmerchantable quality if they are of no use or not fit for the purpose for which they are acquired. Delivery of goods that fail to perform any of their normal functions constitutes breach of this implied condition, entitling the buyer to reject the goods.
Damages & Quantum — Breach of Contract — Remoteness of Damages — Hadley v Baxendale Test
Damages recoverable for breach of contract are such as may fairly and reasonably be considered either arising naturally, that is according to the usual course of things, from the breach itself, or such as may reasonably be supposed to have been in contemplation of the parties at the time they made the contract as the probable result of the breach. Damages that are not fairly and reasonably connected to the breach and cannot reasonably be supposed to have been in contemplation of the parties are too remote.
Damages & Quantum — Mitigation of Loss — Duty of Injured Party
Following breach of contract, the injured party is expected to do what he can to look after his own interests and must mitigate his loss. Failure to take reasonable steps to mitigate may result in disallowance of damages that could have been avoided.
Damages & Quantum — General Damages — Assessment in Breach of Contract
General damages in a breach of contract case are what the court may award when it cannot point out any measure by which they are to be assessed, except the opinion and judgment of a reasonable tribunal. General damages consist of items of normal loss which the plaintiff is not required to specify in his pleading in order to permit proof at trial.

Legislation cited (2)

  • Sale of Goods Act Cap. 82 s.15
  • Sale of Goods Act Cap. 82 s.15(b)

Cases cited (3)

  • Hadley v Baxendale (1854) 9 Ex 341
  • Monarch S.S. Co. v Karlshanus Oliefabriker [1949] AC 196
  • Haji Asumani Mutekanga v Equator Growers (U) Ltd (SCCA No. 7 of 1995)

Full judgment

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

Lutale v Ssegawa (HCT-00-CC-CS 292 of 2006) [2008] UGCommC 14 (14 February 2008)
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.