Makindye Sabagabo Municipal Council v Busenvi Enterprises Limited (Miscellaneous Application 475 of 2022)

Observed later treatment

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 court held that the arbitration clause became inoperative and unenforceable where the Special Conditions of Contract superseded the General Conditions and provided for court resolution after amicable settlement failed, the Procurement and Disposing Entity failed to appoint an adjudicator, and both parties voluntarily subjected themselves to court jurisdiction by entering a consent decree resolving part of the dispute. The application to refer the matter to arbitration was dismissed.

Outcome

Application to refer matter to arbitration dismissed; matter to proceed to hearing on merits in High Court

Facts

The parties entered a contract in July 2017 for upgrading St. Noah Road. The Respondent claimed the Applicant defaulted on payments causing the Respondent's bank loan to default. The Respondent filed Civil Suit No. 400 of 2019 claiming UGX 685,992,329. The parties entered court-facilitated mediation resulting in a partial consent decree dated 25 February 2020 wherein the Applicant agreed to pay UGX 298,841,511 in installments, with the disputed balance left for trial. The Applicant then raised a preliminary objection that the matter should be referred to arbitration under an arbitration clause in the contract. The contract's General Conditions contained arbitration provisions, but the Special Conditions provided that for smaller contracts where no adjudicator was appointed, disputes should be resolved amicably and if that failed, referred to competent courts. The Respondent had written to the Applicant on 2 July 2019 and 29 July 2019 seeking amicable resolution but received no response.

Issues

1. Whether the suit is barred by law for want of jurisdiction and ought to be referred to arbitration.

Orders

• Application dismissed.
• Plaintiff directed to move court to have the matter fixed for hearing.
• Court will issue necessary directions and timelines.
• Costs of the application awarded to the Respondent.

Rules and key headnotes

Legislation cited (6)

• Arbitration and Conciliation Act Cap 5 s.5(1)
• Arbitration and Conciliation Act Cap 5 s.5(9)
• Arbitration and Conciliation Act Cap 5 s.2(1)(c)
• Arbitration and Conciliation Act Cap 5 s.9
• Arbitration Rules r.13
• Constitution of Uganda art.139(1)

Cases cited (5)

• Vantage Mezzanine Fund II Partnership v Simba Properties Investment Co Ltd & Another (Miscellaneous Application of 2020)
• Fort Portal Municipal Council v Plinth Technical Works Ltd (HCMA No. 231 of 2019)
• Koboko District Local Government v Okujjo Swali (Miscellaneous Application No. 0001 of 2016)
• Heyam and Another v Darwins Ltd [1942] 1 All ER 337
• Premium Nafta Products Ltd v Fili Shipping Company Ltd [2007] UKHL 40

Cases citing this judgment (1)

How later Ugandan judgments in the Wakilii corpus have cited this case. Treatment labels come from Sequitur — Uganda’s citator — each backed by a verbatim span from the citing judgment, and are not an assertion that this case is, or is not, good law.

• Nassuna v Kamoga Matovu and Others (Miscellaneous Application 1024 of 2023)

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