Wakilii

Robert Muganyizi v Bati Businesscenter Ltd and Another [2023] UGHC 538

High Court · 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 contract, heard ex parte after defendants failed to file defences
Decision
Judgment entered for plaintiff for UGX 78,529,000/= to be paid by defendants jointly and severally upon full payment of contract sum by Ministry

Observed later treatment

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Holding

Held that where parties freely entered a memorandum of understanding to equally share the contract price upon payment by the client, and the defendants received payment but failed to pay the plaintiff's share, the defendants are liable to pay UGX 78,529,000/= jointly and severally upon full payment of the contract sum. General damages refused where non-payment resulted from incomplete payment by the Ministry rather than defendants' breach.

Outcome

Judgment entered for plaintiff for UGX 78,529,000/= to be paid by defendants jointly and severally upon full payment of contract sum by Ministry

Facts

In October 2020, the 2nd defendant informed the plaintiff that his company (1st defendant) was the successful bidder for supply of survey equipment to the Ministry of Water and Environment worth UGX 157,058,000/=. The parties executed a memorandum of understanding on 23rd October 2020 agreeing to equally share the contract cost, with each contributing half the equipment cost of USD 13,500 and administrative costs. The plaintiff paid USD 6,750 and UGX 5,000,000/= in cash. The parties opened a joint bank account with both as signatories. The equipment was delivered and the Ministry paid UGX 80,000,000/= on 27th April 2021 and UGX 69,072,000/= on 7th December 2021 to the 1st defendant's account. However, these payments totaling UGX 149,072,000/= were made to a different account than agreed, and defendants refused to pay plaintiff's share of UGX 78,529,000/= as agreed. Defendants failed to file defences and the suit proceeded ex parte.

Issues

  1. Whether the defendants are indebted to the plaintiff to the sum of UGX 79,529,000/=
  2. What remedies are available to the parties

Orders

  • Plaintiff entitled to UGX 78,529,000/= out of the contract sum under the memorandum of understanding dated 23rd October 2020.
  • Defendants to pay UGX 78,529,000/= jointly and severally upon payment of the total contract sum agreed.
  • Prayer for general damages declined.
  • Prayer for interest on general damages declined.
  • Prayer for permanent injunction against defendants declined.
  • Prayer for order directing Ministry of Water and Environment declined.
  • Costs awarded to the plaintiff.

Rules and key headnotes

Contract Law — Enforcement of Contractual Terms — Freely Negotiated Agreements
People who freely negotiate and conclude a contract should be held to their bargain and judges should not intervene by substituting, according to their individual sense of fairness, terms which are contrary to those which the parties have agreed upon themselves.
Civil Procedure — Ex Parte Proceedings — Effect of Failure to File Defence
Where defendants are duly served with summons but fail to file defences, the suit may proceed ex parte and the plaintiff's claims in the plaint and witness statement remain unchallenged.
Contract Law — Joint and Several Liability — Memorandum of Understanding
Where a memorandum of understanding provides for equal sharing of contract proceeds, parties who receive payment but fail to pay the agreed share are liable jointly and severally to pay the amount due under the memorandum.
Contract Law — General Damages — Conditions Precedent
General damages will not be awarded for non-payment of a contractual sum where the contract stipulates payment is due only upon full payment by a third party and such full payment has not yet been made.
Civil Procedure — Third Party Rights — Orders Against Non-Parties
Courts will not issue orders against a third party not joined to proceedings as doing so would deprive that party of its constitutional right to a fair hearing.

Legislation cited (1)

Cases cited (1)

  • Stockloser v Johnson (1954) 1 ALL ER 630

Full judgment

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

Robert Muganyizi v Bati Businesscenter Ltd and Another 2023 UGHC 538 (28 March 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.