Wakilii

Rushfar Trading company Limited v Chongqing International Construction corporation Limited and 2 Others (Miscellaneous Application 1702 of 2021)

High Court · [2023] UGCOMMC 101 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application to discharge obligations under a consent judgment and to set aside consent judgment on grounds of mistake, misapprehension and misrepresentation
Decision
Application dismissed. Applicant remains bound by the terms of the consent judgment executed on 7th July 2021.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court dismissed the application to set aside a consent judgment. The applicant sought discharge from obligations to pay USD 67,000 and to set aside the consent judgment on grounds of frustration, mistake, and misrepresentation. The court held that consent judgments can only be set aside for fraud, collusion, mistake, misapprehension or policy violation. The applicant failed to establish that the first respondent frustrated performance or that the consent was procured by misrepresentation. The terms of clause 2 (payment obligation) and clause 4 (release of bitumen) were distinct and independent. The parol evidence rule prevented the applicant from introducing extrinsic evidence to vary the written consent judgment.

Outcome

Application dismissed. Applicant remains bound by the terms of the consent judgment executed on 7th July 2021.

Facts

The 1st Respondent sued the 2nd Respondent for USD 694,731.57 for breach of contract for supply of bitumen. The applicant was added as a third party. On 7 July 2021, the parties executed a consent judgment whereby the 2nd respondent would pay the 1st respondent USD 233,000, the applicant (third party) would pay USD 67,000 within three months as a top-up, the 2nd respondent would pay the applicant USD 100,000 in settlement of the counterclaim, and the 1st respondent would hand over bitumen to the applicant 'as is'. The applicant subsequently sought to set aside the consent judgment, alleging that the USD 67,000 payment was premised on sale of the bitumen, that the 1st respondent frustrated access to the bitumen by imposing new conditions, that 700 drums were missing, and that market value was deteriorating. The 1st respondent had released the bitumen to the applicant through a letter dated 8 July 2021, and records showed the applicant collected bitumen between 24 July and 2 September 2021, selling approximately 50% of it. The 2nd respondent had honoured its payment obligations including the USD 100,000 to the applicant.

Issues

  1. Whether the applicant should be discharged from her obligations under clause 2 of the Consent Judgment?
  2. Whether the application discloses grounds for setting aside the consent judgment dated 7th July 2021?
  3. Whether the applicant is entitled to the remedies sought?

Orders

  • Application dismissed.
  • Costs awarded to the 1st Respondent.

Rules and key headnotes

Consent Judgments — Nature and Effect — Consent Judgment as New Contract
A consent judgment once signed by parties and sealed by the court becomes a new contract which supersedes the original cause of action and is binding upon the parties as the judgment of the court.
Consent Judgments — Setting Aside — Grounds
A court may interfere with a consent judgment only if the consent judgment was procured through fraud, collusion, mistake, misapprehension or ignorance of material facts, or an agreement contrary to public policy. In the absence of these vitiating factors, the consent judgment must be upheld.
Parol Evidence Rule — Written Contracts — Exclusion of Extrinsic Evidence
Once parties have reduced a contract into writing, any extrinsic evidence meant to vary, contradict, alter or add to the terms of the agreement is generally inadmissible. The rationale is to maintain the sanctity of contracts entered into freely by the parties.
Consent Judgments — Setting Aside on Ground of Mistake — Requirements
To set aside a consent judgment on the ground of mistake, the applicant must show: (i) the true facts were not known by the parties or court when the order was made; (ii) the true facts would have led to a materially different order; (iii) the absence of true facts was not the applicant's fault; (iv) the applicant could not with due diligence have established the true facts at the time; (v) the application was made reasonably promptly; (vi) the applicant cannot obtain alternative mainstream relief; and (vii) granting the application would not prejudice third parties who acquired interests in good faith.
Approbation and Reprobation — Accepting Benefits and Challenging Agreement
A party who has received benefits under a consent judgment cannot subsequently apply to set it aside. The doctrine of approbation and reprobation prevents a person from both approving and rejecting an instrument, commonly described as blowing hot and cold.
Discharge by Frustration — Independent Contractual Obligations
Where clauses in a contract or consent judgment are plain, clear, and distinct, with none stipulating to be intertwined with the other, the obligations are independent and each party must honour the obligations upon them. A party cannot claim frustration of one obligation by the other party's alleged breach of a separate, independent obligation.

Legislation cited (8)

Cases cited (16)

  • Oloka Onyango and 9 Others v Attorney General (Constitutional Petition No. 8 of 2014)
  • Hirani v Kassam (1952-53) EA 131
  • Cargo World Logistics Ltd v Royale Group Africa Ltd (High Court Civil Suit No. 157 of 2013)
  • Ronald Kasibante v Shell (U) Ltd (High Court Civil Suit No. 542 of 2006)
  • Future Stars Investments (U) Ltd v Nusuru Yusuf (High Court Civil Suit No. 0012 of 2017)
  • Oscar Chess v Williams [1957] 1 All ER 325
  • Attorney General and Another v James Kamoga and Others (Supreme Court Civil Appeal No. 8 of 2004)
  • Krone Uganda Ltd v Kerilee Investments Ltd (High Court Miscellaneous Application No. 306 of 2019)
  • Fredrick Zaabwe v Orient Bank and Others (Supreme Court Civil Appeal No. 4 of 2006)
  • Oyugi Martin v Oyoo Anthony (Civil Appeal No. 0019 of 2012)
  • Kakooza Yasin v Kaweesa Nicholas (Miscellaneous Application No. 888 of 2021)
  • Friedhelm Erwin Jost and Another v Roko Construction Ltd and 2 Others (High Court Miscellaneous Application No. 0089 of 2021)
  • Basima Kabonesa Versus AG and another SCCA NO. of 2021
  • J v B [2016] 1 WLR 3319
  • Attorney General v Good Man Agencies Ltd (Supreme Court Civil Appeal No. 05 of 2010)
  • Energo (U) Co. Ltd v Geoffrey Rubaramira and Attorney General (Court of Appeal Civil Appeal No. 0183 of 2013)

Full judgment

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Rushfar Trading company Limited v Chongqing International Construction corporation Limited and 2 Others (Miscellaneous Application 1702 of 2021) [2023] UGCommC 101 (17 October 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.