Wakilii

Nabulya v Jaco (Civil Suit 992 of 2022)

High Court · [2023] UGCOMMC 150 · 2023 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of memorandum of understanding, proceeded by way of default judgment
Decision
Judgment entered for plaintiff with damages, interest, and costs. Defendant found in breach of memorandum of understanding.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions—always read the source judgment before relying on it.

Holding

The High Court held that a valid contract existed between the parties under a memorandum of understanding whereby the defendant would use the plaintiff's certificate of title as security for a bank loan in exchange for 10% of the loan facility. The defendant breached the contract by failing to pay the agreed 10%, defaulting on the loan, and causing the plaintiff's property to face foreclosure. The plaintiff was awarded special damages of UGX 61,860,000 (representing the amount she paid to redeem her property), UGX 8,900,000 (the unpaid 10% fee), general damages of UGX 20,000,000, interest at 18% per annum on special damages from filing until payment, and interest at 6% per annum on general damages from judgment.

Outcome

Judgment entered for plaintiff with damages, interest, and costs. Defendant found in breach of memorandum of understanding.

Facts

On 5 May 2016, the plaintiff and defendant entered into a memorandum of understanding whereby the plaintiff allowed the defendant to use her certificate of title for land at Block 383 Plot 9779 Kitende, Wakiso District as security for a loan facility of UGX 89,000,000 from Equity Bank Limited. In exchange, the defendant was to pay the plaintiff 10% of the loan facility (UGX 8,900,000) and the arrangement was to last four months. The defendant obtained the loan but failed to pay the plaintiff the agreed 10% and subsequently defaulted on the loan. Equity Bank foreclosed and attached the mortgaged property. The plaintiff instituted Civil Suit No. 759 of 2021 against both the defendant and Equity Bank, and later entered into a consent agreement with Equity Bank whereby she paid UGX 61,860,000 to redeem and recover her property. The defendant failed to enter appearance in the present suit despite being served with summons. The court proceeded to hear the matter by way of default judgment and formal proof.

Issues

  1. Whether there was a binding contract between the parties
  2. Whether there was a breach of contract
  3. Whether the plaintiff is entitled to the remedies or prayers

Orders

  • Declaration that there existed a valid contract between the plaintiff and the defendant.
  • Declaration that the defendant breached the contract.
  • Plaintiff awarded UGX 8,900,000 being the 10% agreed to in the memorandum of understanding.
  • Plaintiff awarded special damages of UGX 61,860,000.
  • Plaintiff awarded general damages of UGX 20,000,000.
  • Plaintiff awarded interest of 18% per annum on UGX 61,860,000 from the date of filing the suit until payment in full.
  • Plaintiff awarded interest of 6% per annum on UGX 20,000,000 from the date of judgment until payment in full.
  • Costs of the suit awarded to the plaintiff.

Rules and key headnotes

Contract Law — Formation of Contract — Essential Elements
A valid and enforceable contract requires an agreement made with the free consent of parties with the capacity to contract, for a lawful consideration and with a lawful object, with the intention to be legally bound. A contract may be oral, written, partly oral and partly written, or implied from the conduct of the parties.
Contract Law — Breach of Contract — Definition and Consequences
Breach of contract is the violation of a contractual obligation by failing to perform one's own promise, by repudiating it, or by interfering with another party's performance. Such breach confers a right of action for damages on the injured party.
Civil Procedure — Burden of Proof — Default Judgment
In civil proceedings, even where a matter proceeds by way of default judgment due to the defendant's failure to appear, the plaintiff must still prove their case on the balance of probabilities. The grant of default judgment does not relieve the plaintiff of the burden to establish their claim through evidence.
Damages & Quantum — Special Damages — Proof Required
Special damages must be specifically pleaded and proved. Strict proof does not require that evidence must always be documentary; special damages may also be proved by direct evidence of a person who received or paid, or by testimony of experts conversant with the matter.
Damages & Quantum — General Damages — Principles of Assessment
In assessing general damages for breach of contract, courts are guided by the value of the subject matter, the economic inconvenience suffered by the injured party, and the nature and extent of the breach. A plaintiff who suffers damage due to the wrongful act of the defendant must be put in the position they would have been in had they not suffered the wrong.
Damages & Quantum — Interest on Damages — Discretion of Court
The award of interest on damages is within the court's discretion. The basis for awarding interest is that the defendant has taken and used the plaintiff's money and benefited from it. The court may award different rates of interest on special damages and general damages, reflecting the nature of each award and current commercial bank rates.
Damages & Quantum — Mesne Profits — Requirements for Award
Mesne profits are those profits which the person in wrongful possession of property actually received or might with ordinary diligence have received from it, together with interest on those profits, but excluding profits due to improvements made by the person in wrongful possession. A claim for mesne profits requires evidence of actual or reasonably foreseeable earnings from the property that were disrupted or received by the defendant.

Legislation cited (9)

Cases cited (15)

  • Miller v Minister of Pensions [1947] 2 All ER 372
  • William Kasozi v DFCU Bank Ltd (High Court Civil Suit No. 1326 of 2000)
  • Ronald Kasibante v Shell Uganda Ltd (High Court Civil Suit No. 542 of 2006)
  • Mugabi John v Attorney General (Civil Suit No. 133 of 2002)
  • Gapco (U) Ltd v A.S. Transporters (U) Ltd (Court of Appeal Civil Appeal No. 18 of 2004)
  • Stroms v Hutchinson [1905] AC 515
  • Uganda Commercial Bank v Kigozi [2002] 1 EA 305
  • Charles Acire v Myaana Engola (High Court Civil Suit No. 143 of 1993)
  • Kibimba Rice Ltd v Umar Salim (Supreme Court Civil Appeal No. 17 of 1992)
  • Hadley v Baxendale (1854) 9 Exch 341
  • Premchandra Shenoi & Anor v Maximov Oleg Petrovich (Supreme Court Civil Appeal No. 9 of 2003)
  • SIETCO v Noble Builders (U) Ltd (Supreme Court Civil Appeal No. 31 of 1995)
  • Harry Ssempa v Kambagambire David (High Court Civil Suit No. 408 of 2014)
  • Iyamuleme David v Attorney General (Supreme Court Civil Appeal No. 4 of 2013)
  • Anglo-Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd [1951] 1 All ER 873

Full judgment

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

Nabulya v Jaco (Civil Suit 992 of 2022) [2023] UGCommC 150 (1 December 2023)
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.