Wakilii

Mustapha Ramathan & Anor v Century Bottling Company (HCT-00-CC-CS 431 of 2006)

High Court · [2010] UGCOMMC 7 · 2010 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of agency agreement and damages
Decision
Plaintiffs awarded damages and refund of money paid for undelivered goods

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that the 1999 agency agreement had been superseded by the 2005 Manual Distribution Centre Agreement, which governed the parties' relationship at the time of dispute. The defendant de facto terminated the MDC agreement without written notice as required under the agreement. The court ordered repayment of UGX 5,520,000 paid for undelivered goods with interest at 21% per annum, and awarded general damages of UGX 5,000,000 for breach of the agency agreement with interest at 8% per annum.

Outcome

Plaintiffs awarded damages and refund of money paid for undelivered goods

Facts

In 1999, a partnership known as Bombo Wholesalers (comprising three Ramathan brothers) executed an agency agreement with Century Bottling Company Ltd to distribute the defendant's products in specified areas. One brother died in 1994 and another in 2005. In 2005, the late Kassim Ramathan registered Top Bombo Wholesalers and executed a Manual Distribution Centre Agreement with the defendant. The plaintiffs alleged the defendant wrongfully terminated the 1999 agreement, appointed other agents in their territory, and breached the agency. In June 2006, after the defendant's officers found inadequate stock at the plaintiffs' depot, they announced closure. The plaintiffs deposited UGX 5,520,000 for 600 crates but delivery was delayed. On 20th June 2006, the defendant collected its property loaned to the plaintiffs, effectively ending the relationship.

Issues

  1. Whether the defendant terminated the agency agreement dated 19th June 1999 within the terms of the agreement
  2. Whether the defendant appointed other agents and if so whether it was in breach of the agreement dated 19th June 1999
  3. Whether the agency relationship between the plaintiffs and defendant was governed by the MDC agreement dated 25th April 2005 and if so whether it was breached by either party
  4. What are the remedies available

Orders

  • Defendant to pay plaintiffs UGX 5,520,000 as money had and received.
  • The sum of UGX 5,520,000 to attract interest at 21% per annum from 7th June 2006 until payment in full.
  • General damages awarded at UGX 5,000,000.
  • General damages to attract interest at 8% per annum from the date of judgment until payment in full.
  • Plaintiffs awarded 50% of the taxed costs.

Rules and key headnotes

Contract Law — Agency Agreements — Superseding Agreements
Where a subsequent agreement contains an express clause superseding all prior agreements between the parties, the prior agreements are cancelled from the commencement date of the new agreement and become irrelevant to disputes arising under the new agreement.
Commercial Law — Agency Agreements — Termination Requirements
Where an agency agreement provides that termination must be effected by notice in writing, a de facto termination by conduct (such as collecting property on loan and ceasing supply) without written notice constitutes a breach of the agreement.
Contract Law — Agency Agreements — Authority to Bind Principal
Where both parties to an agreement treat the signature of an authorised officer signing on behalf of a principal as binding, and no vitiating circumstances such as fraud are established, the court will presume the agreement was legitimately executed and binding on the principal under the maxim omnia praesumuntur legitime facta donec probetur in contrarium.
Civil Procedure — Parties — Misjoinder or Non-joinder
Under Order 1 rule 9 of the Civil Procedure Rules, no suit shall be defeated by reason of misjoinder or non-joinder of parties, and the court may deal with the matter in controversy so far as regards the rights and interests of the parties actually before it.
Damages & Quantum — Special Damages — Burden of Proof
For a plaintiff to succeed on a claim for special damages, the damages must be specifically pleaded and strictly proved with evidence establishing the quantum claimed.

Legislation cited (5)

Cases cited (2)

  • Fredrick Zaabwe v Orient Bank and Five Others (Civil Appeal No. 4 of 2006)
  • Solle v Butcher [1950] 1 KB 671

Full judgment

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

Mustapha Ramathan & Anor v Century Bottling Company (HCT-00-CC-CS 431 of 2006) [2010] UGCommC 7 (24 March 2010)
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.