Wakilii

New Alobo Ltd v Moyo Hardware Ltd (HCCS 364 of 2007)

High Court · [2011] UGCOMMC 4 · 2011 Judgment for Defendant / Counterclaim Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for compensation for developments and renovations, and defendant's counterclaim for unpaid rent and loan repayment.
Decision
Judgment entered for the defendant/counterclaimant on the counterclaim with orders for payment of unpaid rent, loan balance, general damages, interest and costs. Plaintiff's claim dismissed with no order as to costs.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court found that the plaintiff carried out renovation works worth Ug.Shs.104,786,876/= and that Ug.Shs.24,700,000/= of the defendant's Ug.Shs.50,000,000/= loan repayment offset those works. The plaintiff owed unpaid rent of Ug.Shs.166,200,000/=. The defendant was entitled to recover Ug.Shs.123,048,709/= paid on the plaintiff's second loan. The plaintiff's claim that its ability to repay the loan was frustrated by the defendant was rejected. After set-offs, judgment was entered for the defendant on the counterclaim.

Outcome

Judgment entered for the defendant/counterclaimant on the counterclaim with orders for payment of unpaid rent, loan balance, general damages, interest and costs. Plaintiff's claim dismissed with no order as to costs.

Facts

New Alobo Ltd (plaintiff) was tenant of premises owned by Moyo Hardwares Ltd (defendant) from December 2001. With the defendant's permission through its Managing Director Alexander Okello, the plaintiff effected developments and renovations including repairs, new structures, and a parking yard. The plaintiff obtained two loans from Stanbic Bank: Ug.Shs.50,000,000/= and Ug.Shs.100,000,000/=, both secured by the defendant's title. The plaintiff claimed compensation of Ug.Shs.104,786,876/= for the renovation works. The defendant counterclaimed for unpaid rent of Ug.Shs.166,200,000/= and Ug.Shs.123,048,709/= paid as guarantor on the plaintiff's second loan after the plaintiff vacated the premises in March 2007.

Issues

  1. Whether the plaintiff carried out renovation works worth Ug.Shs.104,786,876/= on the defendant's premises.
  2. Whether the defendant's payment of the plaintiff's loan of Ug.Shs.50,000,000/= was applied to offset the works done.
  3. Whether the plaintiff owes the defendant unpaid rent worth Ug.Shs.166,200,000/=.
  4. Whether the defendant is entitled to a refund of Ug.Shs.123,048,709/= from the plaintiff with regard to the second loan paid by the defendant.

Orders

  • The plaintiff is awarded Ug.Shs.104,786,876/= as special damages for developments and renovations.
  • This amount is offset by the loan repayment of Ug.Shs.123,048,709/= and Ug.Shs.24,700,000/= already paid.
  • General damages, interest and costs are declined to the plaintiff.
  • The defendant/counterclaimant is awarded Ug.Shs.166,200,000/= being unpaid rent.
  • The defendant/counterclaimant is awarded Ug.Shs.42,961,833/= being the remaining balance on Ug.Shs.123,048,709/=.
  • The defendant/counterclaimant is awarded Ug.Shs.3,000,000/= as general damages.
  • Interest at 21% per annum is awarded on the principle amounts from the date of judgment until payment in full.
  • Interest at 8% per annum is awarded on general damages from the date of judgment until payment in full.
  • Costs of the counterclaim awarded to the defendant/counterclaimant.

Rules and key headnotes

Special Damages — Proof Requirements
Special damages must be specifically pleaded and strictly proved. The party claiming special damages bears the burden of proving the quantum with supporting documentary evidence such as receipts and bills of quantities.
Frustration — Self-Induced Frustration
A party cannot rely on self-induced frustration, that is frustration due to his own conduct or the conduct of those for whom he is responsible. Where a party's own actions render contractual performance impossible, those actions do not constitute frustration and the party remains liable under the contract.
Set-Off — Application of Payments
Where a guarantor pays off a debtor's loan, the amount paid may be set off against sums owed by the guarantor to the debtor arising from other contractual obligations between the parties.
Burden of Proof — Payment of Debt
The burden of proof lies on the party who asserts that a debt has been paid. Where payment is disputed and no independent documentary evidence is available, the court will assess the credibility of witnesses and the probabilities to determine whether payment was made.
General Damages for Breach of Contract — Measure
The general intention of the law in giving damages for breach of contract is to restore the wronged party into the position he would have been in if there had been no breach of contract. General damages are awarded at the court's discretion based on the loss suffered.
Interest on Judgment — Discretion of Court
An award of interest is made at the discretion of the court to compensate a party for loss occasioned by the other party's failure to pay a sum due. Different rates may be applied to principle amounts and general damages.

Legislation cited (2)

Cases cited (3)

  • British Movie Tone News v London and District Cinemas [1952] AC 166
  • Interfreight Forwarders (U) Ltd v East African Development Bank (SCCA No. 33 of 1993)
  • Davis Contractors Ltd v Fareham Urban District Council [1956] 1 All ER 145

Full judgment

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

New Alobo Ltd v Moyo Hardware Ltd (HCCS 364 of 2007) [2011] UGCommC 4 (10 January 2011)
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.