Shell Uganda v Captian. Naeem Shair Chaudry (Civil Appeal No. 32 of 2010)

Observed later treatment

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 held that where a suit recovers a liquidated sum already expended at the time of filing, interest must be awarded from the date of filing the suit, not from the date of judgment; interest from judgment applies only to general damages requiring assessment. The trial Judge misdirected himself in awarding interest on the liquidated decretal sum from the date of judgment, causing injustice. The appeal was allowed and the order substituted so interest runs from the filing date. The preliminary objection on competence was overruled, the appeal having been instituted within time under the Court of Appeal Rules. The cross-appeal challenging the guarantee's enforceability was struck out, the guarantees having clear credit limits.

Outcome

Appeal allowed; interest order varied to run from the date of filing the suit; cross-appeal struck out

Facts

Shell Uganda Limited appointed the respondent as its dealer to operate three petrol stations in March 1999. In about February 2001, Shell arranged a banking facility with Citibank to boost the respondent's business, later renewed twice. Disagreements arose over the respondent's failure to service the facility, prompting Citibank to cancel it. As guarantor, Shell paid Citibank UGX 241,707,213 in satisfaction of the respondent's liability. Shell sued the respondent (HCCS No. 179 of 2004) to recover that sum, which had been advanced under guarantees with credit limits. Judgment was entered for Shell for the decretal sum with interest at 20% per annum running from the date of judgment until payment. Shell's application to have interest run from the date of filing the suit was refused. Shell appealed against the interest order; the respondent cross-appealed contending the guarantee was uncertain and unenforceable for lack of a credit limit, and that Shell was under no legal compulsion to pay.

Issues

1. Whether the appellant's notice of appeal and record of appeal were filed within time and the appeal competent.
2. Whether the trial Judge erred in awarding interest on the decretal sum from the date of judgment rather than from the date of filing the suit.
3. Whether the guarantee was uncertain and unenforceable for lack of a credit limit, so that the appellant was under no legal compulsion to pay Citibank.

Orders

• The appellant's appeal, Civil Appeal No. 32 of 2010, is allowed.
• The learned trial Judge's order as regards interest is set aside and substituted with an order that interest of 20% on the decretal sum is to run from 23 January 2006, the date of filing the suit.
• The respondent is ordered to bear the costs of the appeal.
• The respondent's cross-appeal is struck out.
• The cross appellant is to bear the cross respondent's costs of the cross appeal.

Rules and key headnotes

Legislation cited (11)

• Civil Procedure Act s.26(2)
• Judicature (Court of Appeal Rules) Directions Rule 76(2)
• Judicature (Court of Appeal Rules) Directions Rule 83(1)
• Judicature (Court of Appeal Rules) Directions Rule 84(a)
• Judicature (Court of Appeal Rules) Directions Rule 84(b)
• Judicature (Court of Appeal Rules) Directions Rule 91(1)
• Judicature (Court of Appeal Rules) Directions Rule 91(2)
• Judicature (Court of Appeal Rules) Directions Rule 94
• Judicature (Court of Appeal Rules) Directions Rule 100(2)
• Judicature (Court of Appeal Rules) Directions Rule 2(2)
• Judicature (Court of Appeal Rules) Directions Rule 32(2)

Cases cited (18)

• Wanume David Kitamirike v Uganda Revenue Authority (Civil Appeal No. 138 of 2010)
• HUQ VS ISLAMIC UNIVERSITY IN UGANDA [1995-1998] 2 EA 117
• Kanabolic Group of Companies (U) Ltd v Sugar Corporation of Uganda Ltd (Civil Appeal No. 15 of 1994)
• BEGUMISA FINANCIAL SERVICES LTD VS GENERAL MOULDINGS LTD & ANOR [2007]1 EA 28
• SHAH VS MBOGO & ANOR [1968] EA 93
• WARD VS JAMES [1965] 1 ALL ER 563
• PREM LATA VS PETER MUSA MBIYU [1965] EA 592
• HIGHWAY FURNITURE MART LIMITED VS THE PERMANENT SECRETARY & ANOR [2006] 2 EA 94
• Father Nasensio Begumisa and 3 others v Eric Begumisa (Civil Appeal No. 17 of 2002)
• Sietco v Noble Builders Ltd (Civil Appeal No. 31 of 1995)
• Harbutt's Plasticine Ltd v Wayne Tank and Pump Company Limited [1970] 1 QB 447
• Mukisa Biscuit Manufacturing Company Limited v West End Distributors Limited number 2 [1970] EA 469
• J.K. Patel v Spear Motors Ltd (Civil Appeal No. 4 of 1991)
• Hirji Vs Modessa (1967) EA 724
• Kimani Vs Attorney General (1969) MA 502
• Kigundu & Another v Uganda Transport Company (Civil Appeal No. 7 of 1993)
• AS FOLKES & CO VS KASANDAS PURSHOTTAM & ANOR [1959] EA 36
• Toprani v. Patel [1958] E.A. at p. 349

Cases citing this judgment (2)

How later Ugandan judgments in the Wakilii corpus have cited this case. Treatment labels come from Sequitur — Uganda’s citator — each backed by a verbatim span from the citing judgment, and are not an assertion that this case is, or is not, good law.

• Shire Petroleum Company Limited and Another v Vivo Energy Uganda Limited (Civil Appeal No. 96 of 2018)
• Olwedo v Attorney General (Civil Suit No. 381 of 2005)

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