Star Supermarket (U) Ltd v Attorney General (CIVIL APPEAL NO. 34 OF 2000)

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 partly allowed the appeal. It upheld the trial judge's refusal of special damages claimed for currency depreciation, holding that the contract was negotiated and payable in Uganda Shillings; the loss tied to the US Dollar exchange rate was neither agreed upon nor brought to the buyer's notice and was therefore too remote. However, the Court held that interest awards arising from commercial or business transactions normally attract a higher rate than compensatory general damages. As the decretal sum arose from a commercial transaction and payment had been delayed, the 6% interest was too low. The Court set it aside and substituted interest at 25% per annum from 19 June 1998 to the date of payment.

Outcome

Appeal partly allowed; interest on the decretal sum raised from 6% to 25% per annum, refusal of special damages upheld

Facts

The appellants supplied emergency dry ration (biscuits, beans and chicken) to the Uganda Peoples Defence Forces under an oral contract evidenced by the defendant's order and the appellants' delivery notes. The total value of goods supplied was Shs. 202,064,000, of which the defendant paid Shs. 101,032,000, leaving a balance of Shs. 101,032,000. The appellants had bought the goods in US Dollars from South African suppliers. They claimed the unpaid balance, plus special damages of Shs. 142,082,850 for losses arising from depreciation of the Uganda Shilling against the US Dollar between contracting (Shs. 1200) and suit (Shs. 1450), general damages, and interest. The trial judge entered judgment for the unpaid balance but refused special damages, finding the transaction was conducted in Uganda Shillings, and awarded interest at 6%. The appellants appealed the refusal of special damages and the interest rate.

Issues

1. Whether the appellants were entitled to special damages arising from depreciation in the exchange rate between US Dollars and Uganda Shillings during the period of delayed payment.
2. Whether the trial judge erred in awarding interest at 6% on the decretal sum in a commercial transaction.

Orders

• Appeal dismissed in part and allowed in part.
• Appeal against the trial judge's refusal to award special damages disallowed.
• Appeal against the award of 6% interest allowed.
• Award of 6% interest set aside.
• Decretal sum to carry interest at 25% per annum from 19 June 1998 to the date of payment in full.
• One-third of the costs of the appeal awarded to the appellants.

Rules and key headnotes

Legislation cited (2)

• Civil Procedure Act s.26(2)
• Civil Procedure Act s.26(3)

Cases cited (1)

• ECTA (U) Ltd v Geraldine Mamubiru Josephine Nanawasa (Civil Appeal No. 29 of 1994)

Cases citing this judgment (6)

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.

• Nantale v Katushabe and 4 others (Civil Miscellaneous Application 111 of 2023)
• Semanda and Another v Lake Wamala Farm Ltd and Others (Miscellaneous Application No. 1 of 2021) followed
• Barclays Bank of Uganda Ltd v Gamuli Tukahirwa (Civil Appeal 88 of 2016)
• Umeme Ltd v Makubuya T a Polla plastic (Civil Appeal No. 0216 of 2015)
• Mpangire v Nyamugabwa (MISC. APPLICATION NO. 0047 OF 2016)
• Firemasters Ltd v British American Tobacco (U) Ltd (HCCS 431 of 2012)

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