Revoluntionary ADS and Designs Ltd v Board of Trustees of Nakivbo Stadium (Civil Appeal No. 131 of 2013)

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

The Court of Appeal dismissed the substantive appeal, holding the appellant failed to discharge its legal and evidential burden of proving breach of contract; production of advertisement photographs without proof that the impugned adverts fell within the appellant's exclusive advertising spaces was insufficient. The court held the doctrine of frustration did not apply because business difficulties and prospective clients' loss of interest were ordinary business risks, not self-induced circumstances rendering performance impossible. However, the court held mere description of a party as an agent does not create agency where the agreement contemplates the party acting on its own behalf; the trial judge erred in finding an agency relationship. The counter-claim for rental arrears was upheld.

Outcome

Appeal substantially dismissed; trial court judgment upheld save that the agency finding was reversed and the start date for 14% interest on rental arrears substituted to the date of filing the counter-claim

Facts

In December 2005 the parties executed a three-year contract under which the appellant would run advertisements in Nakivubo War Memorial Stadium and pay the respondent annual rent of UGX 45,000,000, drawn from advertising charges paid by clients the appellant sourced. The contract obliged the respondent to remit 50% of proceeds from pre-existing advertising contracts and not to allow other advertisers to erect billboards without the appellant's consent, save that the respondent retained 20 advert spaces in the Pitch Perimeter and could place temporary banners for ad hoc functions. The appellant alleged the respondent permitted third parties to advertise and collected charges, causing loss of UGX 140,500,000, and that the respondent frustrated performance and terminated the contract without a hearing. The respondent contended the appellant failed to attract advertisers and defaulted on rent, and counter-claimed UGX 83,000,000 in arrears. The High Court dismissed the suit and upheld the counter-claim with 14% interest.

Issues

1. Whether the trial judge erred in holding that there was no breach of contract by the respondent.
2. Whether the trial judge erred in holding that the respondent did not frustrate the appellant from collecting rent.
3. Whether the trial judge erred in holding that the appellant was an agent of the respondent.

Orders

• The appeal fails in Grounds 1, 2, 3, 4, 6, 7, 9 and 10, but succeeds in Ground 5.
• The 14% interest is substituted to run from the date of filing the counter-claim rather than from the date of filing the suit.
• The appellant is condemned to the costs in this Court and the trial Court.

Rules and key headnotes

Legislation cited (6)

• Evidence Act s.101(1)
• Evidence Act s.102
• Evidence Act s.103
• Contracts Act 2010 s.118
• Contracts Act 2010 s.122
• Judicature (Court of Appeal) Rules r.2(2)

Cases cited (6)

• Davis Contractors Ltd vs. Hare Urban District Council (1956) 1 All ER 145
• Monday Eliab v Attorney General (Civil Appeal No. 16 of 2010)
• Howard & Co. (Afrca) Ltd vs. Burton (1964) EA 540
• J. K. Patel v Spear Motors Ltd (Civil Appeal No. 4 of 1991)
• Constantine Steamline Ship vs. Imperial Smelting Corp. (1945) All ER 165 (House of Lords)
• American Express International Banking Ltd vs. Atul (1990 – 94) EA 10 (Supreme Court of Uganda)

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