Wakilii

Mukooli v The New Forest Co.Ltd (Civil Suit No. 173 of 2008)

High Court · [2015] UGHCCD 23 · 2015 Judgment for Defendant AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for wrongful termination of employment
Decision
Suit dismissed with costs to the defendant

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

An employer may lawfully terminate an employment contract by payment in lieu of notice where the contract expressly provides for such termination. Where the employee accepts payment in lieu of notice, the termination is not wrongful even if the employee was not afforded a hearing, provided the employer proves the reason for dismissal under Employment Act s.68(1).

Outcome

Suit dismissed with costs to the defendant

Facts

The plaintiff was employed by the defendant as Financial Controller under a three-year contract from 15 August 2007. On 28 February 2008, the Chief Financial Controller verbally informed him that his services were terminated. He was not allowed to return to the office. The defendant stated the plaintiff failed to perform his contractual duties including failure to submit financial returns, exercise internal control, perform bank reconciliation, and account for money spent. The defendant paid the plaintiff in lieu of notice pursuant to clause 5.2 of the employment contract. The plaintiff accepted and cashed the payment but later claimed wrongful termination, seeking general and special damages including salary for the remainder of the three-year contract period.

Issues

  1. Whether the defendant wrongfully terminated the plaintiff's employment.
  2. Whether the plaintiff is entitled to the relief sought.

Orders

  • Suit dismissed.
  • Costs awarded to the defendant.

Rules and key headnotes

Termination of Employment — Payment in Lieu of Notice — Contractual Right
Where an employment contract stipulates that the employer may terminate by giving written notice of a specified period or by payment in lieu thereof, the employer is entitled to exercise either option and such termination is lawful where payment in lieu of notice is made and accepted by the employee.
Wrongful Termination — Acceptance of Payment in Lieu — Effect on Right to Challenge
Where an employee accepts payment in lieu of notice under a contractual termination provision, cashes the cheque, and spends the money, the employee cannot subsequently claim that the termination was wrongful or that he was coerced into accepting payment, absent proof of actual coercion.
Dismissal — Burden of Proof — Employment Act s.68(1)
Under Employment Act 2006 s.68(1), in any case arising out of termination, the employer bears the burden of proving the reason or reasons for dismissal, and where the employer fails to do so, the dismissal shall be deemed unfair within the meaning of s.71.
Employment Contracts — Termination Clauses — Exercise of Contractual Option
The right of an employer to terminate a contract of service by giving notice or by paying compensation in lieu of notice for the duration stipulated in the contract cannot be fettered by the court, provided the termination is effected in accordance with the contractual terms.

Legislation cited (2)

Cases cited (1)

  • Bank of Uganda v Tinkamanyire (Supreme Court Criminal Appeal No. 12 of 2007)

Full judgment

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

Mukooli v The New Forest Co.Ltd (Civil Suit No. 173 of 2008) [2015] UGHCCD 23 (24 March 2015)
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.