Mulindwa v Sheroz Auto Trading Co. Limited (Civil Appeal 65 of 2022)

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.

Holding

Held that an unpaid seller who reserves a right of lien in a sale agreement may lawfully repossess goods without a court order where the buyer defaults on payment. Clauses 7 and 9 of the sale agreement reserved the respondent's right of disposal and lien. The respondent legally impounded the vehicle under sections 50–53 of the Sale of Goods and Supply of Services Act 2018. The appeal was dismissed.

Outcome

Appeal dismissed; decision of Chief Magistrate's Court upheld

Facts

The appellant purchased a Toyota Hiace vehicle from the respondent under a hire-purchase agreement dated 21 August 2021. The agreement contained clauses reserving the respondent's right to repossess the vehicle without a court order if the appellant defaulted on payments. The appellant fell into arrears, failing to pay instalments for September, October, and December. The respondent impounded the vehicle. The appellant filed an application in the Chief Magistrate's Court at Nakawa seeking a declaration that the impoundment was illegal, release of the vehicle, damages for lost income, and costs. The Chief Magistrate dismissed the application with costs, finding the respondent had lawfully exercised a right of lien as an unpaid seller. The appellant appealed to the High Court.

Issues

1. Whether the trial magistrate properly evaluated the evidence on record.
2. Whether contractual clauses permitting repossession without court order are illegal and unenforceable.
3. Whether the respondent lawfully exercised a right of lien as an unpaid seller under the Sale of Goods and Supply of Services Act 2018.
4. Whether the appellant is entitled to damages for lost income arising from impoundment of the vehicle.

Orders

• Appeal dismissed.
• Decision and orders in Miscellaneous Cause No. 356 of 2022 upheld.
• Costs of the appeal awarded to the respondent.

Rules and key headnotes

Legislation cited (10)

• Constitution of Uganda Article 26(1)
• Constitution of Uganda Article 26(2)(b)
• Contract Act 2010 s.22
• Contract Act 2010 s.27
• Contract Act 2010 s.45(1)
• Sale of Goods and Supply of Services Act 2018 s.50
• Sale of Goods and Supply of Services Act 2018 s.51
• Sale of Goods and Supply of Services Act 2018 s.51(1)
• Sale of Goods and Supply of Services Act 2018 s.52
• Sale of Goods and Supply of Services Act 2018 s.53

Cases cited (5)

• Kifamunte Henry v Uganda (Supreme Court Criminal Appeal No. 10 of 2007)
• Prof Egbert De Smet v Juliet Nakassaga (Civil Suit No. 387 of 2011)
• Karim Moding v Sulaiman Kabanda (High Court Civil Appeal No. 38 of 2018)
• Moding Holding v Kabanda (Civil Appeal No. 35 of 2015)
• James Fredrick Nsubuga v Attorney General (High Court Civil Suit No. 13 of 1998)

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