Wakilii

Oryx Oil Uganda Limited v Hi-Tech Foam Limited (Civil Suit 870 of 2018)

High Court · [2024] UGCOMMC 363 · 2024 Judgment for Defendant AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of debt arising from alleged supply of fuel products under an oral contract
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

The High Court dismissed the plaintiff's claim for UGX 503,936,888 arising from alleged fuel supply under an oral contract. The court held that oral contracts exceeding UGX 500,000 can be enforceable through part performance and written documentation such as delivery notes, distinguishing Kaggwa where no documentation existed. However, the plaintiff failed to discharge its burden of proof due to numerous invoicing errors in its statement of account, unexplained crossed delivery notes lacking identifiable signatories, and irreconcilable inconsistencies between witnesses' testimonies regarding outstanding amounts and supporting invoices. The defendant was not indebted to the plaintiff.

Outcome

Suit dismissed with costs to the defendant

Facts

Oryx Oil Uganda Limited sued Hi-Tech Foam Limited for UGX 503,936,888 allegedly arising from fuel products supplied in 2017 and 2018. The plaintiff claimed it issued invoices which remained unpaid. The defendant denied indebtedness, asserting it paid in advance by cheque for all deliveries received and that the plaintiff's statement of account contained false claims. The parties had an oral arrangement whereby the plaintiff would supply fuel and the defendant would pay. The plaintiff's statement of account showed numerous errors requiring credit note reversals for wrong invoices, double postings, orders not delivered, and wrong customer charges. The plaintiff's witnesses joined the company after the transactions and could not identify who received deliveries on behalf of the defendant. The delivery notes bore a Hi-Tech Limited stamp but no named signatory, and were crossed without explanation. The two plaintiff witnesses gave conflicting testimony regarding the outstanding amount and which invoices supported the claim.

Issues

  1. Whether the verbal understanding between the plaintiff and the defendant can be legally enforced having not been reduced into writing.
  2. Whether the plaintiff departed from its pleadings.
  3. Whether the defendant is indebted to the plaintiff in the sums claimed and if so how much.
  4. What remedies are available to the parties.

Orders

  • Suit dismissed.
  • Costs awarded to the defendant.

Rules and key headnotes

Oral Contracts — Enforceability — Contracts Act s.10(5) — Part Performance
An oral contract exceeding twenty-five currency points (UGX 500,000) required by section 10(5) of the Contracts Act to be in writing is nevertheless enforceable in equity where one party has partly performed the contract through visible acts such as delivering goods and the other party has accepted performance and made payments, as it would be unconscionable to allow a party who benefited from the contract to later deny its existence.
Written Contract Requirement — Scope — Contracts Act s.10(5) — Informal Documentation
The writing envisaged under section 10(5) of the Contracts Act does not require a formal written contract but is satisfied by any signed writing that reasonably identifies the subject matter, is sufficient to indicate a contract exists, and states the material terms with reasonable certainty, including receipts, delivery notes, or informal letters.
Approbation and Reprobation — Part Performance — Admission by Conduct
A defendant who admits to receiving deliveries under an oral contract and making payments by cheque in consideration for those deliveries cannot later deny the existence or legality of that contract in order to avoid indebtedness, as this contravenes the principle against approbation and reprobation.
Departure from Pleadings — Change of Cause of Action Distinguished from Variance in Amount
There is no departure from pleadings where the cause of action remains the same (recovery of debt from supply of goods) but a witness testifies to a lower quantum than pleaded, provided the plaintiff has not changed the nature of the claim or set up a case inconsistent with the pleadings; departure occurs only where the cause of action itself is altered.
Burden of Proof — Documentary Evidence — Proof of Debt
Where a plaintiff relies on a statement of account to prove a debt, but that statement contains numerous unexplained errors, credit note reversals for orders not delivered, wrong invoices posted, and double charges, and the supporting delivery notes bear no identifiable signatory and are crossed without explanation, the plaintiff fails to discharge its burden under section 101 of the Evidence Act to prove the debt on a balance of probabilities.
Proof of Delivery — Authentication of Documents — Absence of Named Signatory
Delivery notes bearing only a company stamp and the word 'received' but no named signatory or identification of the person who received goods on behalf of a corporate defendant, coupled with conflicting testimony that the defendant used different documentation (confirmation of delivery forms), are insufficient to prove that delivery was received by an authorised representative of the defendant.
Witness Credibility — Inconsistencies Between Witnesses — Material Contradictions
Where a plaintiff's witnesses give irreconcilable testimony as to the outstanding amount (one claiming UGX 443,400,000 supported by six invoices totalling UGX 543,032,650, the other claiming UGX 503,936,888 supported by five invoices totalling UGX 451,991,900), and neither witness was present during the transactions, such material inconsistencies undermine the plaintiff's case and prevent the court from determining what sum, if any, is truly outstanding.

Legislation cited (6)

Cases cited (4)

  • Kaggwa v Kolin Insaat Turizm & 2 Others (High Court Civil Suit No. 318 of 2012)
  • Musoke Kitenda v Roko Construction Limited (Miscellaneous Application No. 1240 of 2020)
  • Jani Properties Ltd v Dar-es-salaam City Council [1966] EA 281
  • Interfreight Forwarders (U) Ltd v East African Development Bank (Court of Appeal Civil Appeal No. 33 of 1992)

Full judgment

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

Oryx Oil Uganda Limited v Hi-Tech Foam Limited (Civil Suit 870 of 2018) [2024] UGCommC 363 (4 November 2024)
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.