Wakilii

Roko Construction Co Ltd v Attorney General (HCT-00-CC-CS 517 of 2005)

High Court · [2008] UGCOMMC 11 · 2008 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 seeking special and general damages for late payment under a construction contract
Decision
Judgment entered for the plaintiff with special, general, and punitive damages awarded and interest running from date of judgment.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

In a breach of contract action for late payment under a construction contract, the court held that where the contract stipulated interest at 5% per annum on delayed payments, the plaintiff could not claim accumulated interest at the higher commercial rate of 18%. Special damages of US$138,894 calculated at the contractual 5% rate were allowed. General damages of UGX 15,000,000 and punitive damages of UGX 2,000,000 were awarded for the defendant's callous and uncaring manner in ignoring payment demands for over five years.

Outcome

Judgment entered for the plaintiff with special, general, and punitive damages awarded and interest running from date of judgment.

Facts

In July 1996, the Uganda Government contracted Roko Construction Co Ltd to refurbish the Ministry of Finance Headquarters Building and reconstruct the Treasury Building for US$5,098,954.71. The plaintiff completed the work and was paid the bulk of its money except for certificates Nos 18R and 19R. The contract stipulated interest at 5% per annum on unpaid sums. The defendant delayed payments and failed to pay interest on those delayed payments despite repeated demands from the plaintiff over five years. Mediation efforts were unsuccessful when the Solicitor General rejected a Memorandum of Understanding on the ground it had not been cleared by the defendant. The plaintiff sued for special and general damages arising from breach of contract, claiming accumulated interest at 18% per annum in the main, or alternatively at the contractual 5% rate. During the pendancy of the suit, the plaintiff received payments amounting to US$143,117.

Issues

  1. Whether the defendant defaulted on its undertaking to pay the plaintiff as per contract.
  2. If so, what is the amount due to the plaintiff?
  3. What reliefs, if any, are appropriate?

Orders

  • Special damages (already paid by the defendant to the plaintiff): US$143,117 (equivalent to UGX 264,766,450).
  • General damages: UGX 15,000,000.
  • Punitive damages: UGX 2,000,000.
  • Interest on general and punitive damages at the rate of 25% per annum from the date of judgment till payment in full.
  • Taxed costs of the suit.

Rules and key headnotes

Contract Law — Interest on Late Payments — Contractual Interest Rate Prevails Over Commercial Rate
Where a contract stipulates a specific interest rate on delayed payments, a party cannot claim accumulated interest at a higher commercial rate beyond the contract period without express contractual provision for interest on interest.
Damages & Quantum — Interest — Equitable Award Beyond Contract Period
The award of interest beyond the contract period may be discretionary as an equitable relief where a wrongdoer deprives a company of money needed for use in its business, with the principle being that mere replacement of the money years later is inadequate compensation, especially in times of inflation.
Damages & Quantum — Interest — Commencement Date for Interest on Damages
Where a person is entitled to a liquidated amount and has been deprived of it through the wrongful act of another, interest should be awarded from the date of filing suit; but where damages are to be assessed by the court, interest is only given from the date of judgment.
Damages & Quantum — General Damages — Assessment in Breach of Contract
General damages in breach of contract are damages arising naturally in the normal course of things which a party is not required to specify in pleadings, and they are assessed according to the opinion and judgment of a reasonable person where the court cannot point to any specific measure of assessment.
Damages & Quantum — Punitive Damages — Callous and Uncaring Conduct
Punitive damages may be awarded where the defendant's conduct in breach of contract was callous and uncaring, such as ignoring repeated payment demands over an extended period.
Evidence — Interest — Claim Must Be Based on Agreement or Statute
Interest can only be claimed if the claim is based on an agreement for it in the document sued upon or by statute.
Civil Procedure — Mediation — Inadmissibility in Subsequent Proceedings
Whatever the parties say or do in mediation should never be allowed to come back to haunt them, after the mediation effort has failed, in later proceedings regarding the same matter or a different one.

Cases cited (5)

  • E.M. Cornwell & Co Ltd v Desai (1941) 6 ULR 103
  • Wallersteiner v Moir [1975] 1 QB 373
  • Harbutt's Plasticine Ltd v Wayne Tank & Pump Co Ltd [1970] 1 QB 447
  • Sietco v Noble Builders (U) Ltd (SCCA No. 31 of 1995)
  • Haji Asumani Mutekanga v Equator Growers (U) Ltd (SCCA No. 7 of 1995)

Full judgment

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

Roko Construction Co Ltd v Attorney General (HCT-00-CC-CS 517 of 2005) [2008] UGCommC 11 (10 February 2008)
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.