Wakilii

Superior Promotions & General Suppliers Ltd v ZK Advertising (U) Ltd (Civil Suit No. 424 of 2010)

High Court · [2012] UGCOMMC 168 · 2012 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 defendant failed to appear
Decision
Judgment entered for the plaintiff with orders for payment of special damages, interest, nominal damages, and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

In a breach of contract action for unpaid goods, where the defendant admitted indebtedness by letter, failed to appear at trial, and raised a belated rejection defence, the court held that goods retained for over five months are deemed accepted under the Sale of Goods Act s.35, and the plaintiff is entitled to the contract price as special damages plus interest and nominal general damages.

Outcome

Judgment entered for the plaintiff with orders for payment of special damages, interest, nominal damages, and costs

Facts

In May 2009, the plaintiff supplied assorted promotional items to the defendant under contract, with payment due 30 days after delivery. The defendant took delivery and made partial payments, leaving a balance of UGX 73,120,050/=. In September 2010, after meetings between the parties and their lawyers, the defendant's Finance Manager sent a letter acknowledging the debt. Four to five months after delivery, the defendant attempted to reject 1,000 branded phone stickers on quality grounds. The defendant's counsel withdrew from the suit after losing contact with the defendant. The plaintiff obtained substituted service, but the defendant failed to appear at the scheduling conference, and the matter proceeded ex parte.

Issues

  1. Whether the plaintiff is entitled to the sum of UGX 73,120,050/= from the defendant as claimed in the plaint.
  2. What other remedies are available to the plaintiff.

Orders

  • UGX 73,120,050/= be paid by the defendant as special damages.
  • Interest of 25% per annum awarded on special damages from 10th July 2010 till payment in full.
  • UGX 5,000,000/= be paid by the defendant as nominal damages.
  • Costs of the suit be paid by the defendant.

Rules and key headnotes

Contract Law — Sale of Goods — Acceptance of Goods — Deemed Acceptance After Lapse of Reasonable Time
Under the Sale of Goods Act s.35, a buyer is deemed to have accepted goods when, after the lapse of a reasonable time, the buyer retains the goods without intimating to the seller that he or she has rejected them. Retention of goods for over five months constitutes acceptance, and subsequent rejection is ineffective.
Contract Law — Breach of Contract — Acknowledgment of Debt — Authority to Bind
Where a defendant's Finance Manager, a member of top management, sends a letter acknowledging indebtedness following meetings between the parties' lawyers, the acknowledgment binds the defendant. An allegation that the officer lacked authority is not credible when the acknowledgment was made in performance of an agreement reached at a meeting and counsel for the defendant received the letter without objection.
Damages & Quantum — General Damages — Nominal Damages — Failure to Prove Actual Loss
A plaintiff is entitled to nominal damages where his rights have been infringed but he fails to prove that he has sustained any actual damage from the infringement. Where a plaintiff in a commercial dispute does not adduce evidence of specific losses suffered as the natural result of the defendant's breach, the court will award nominal damages rather than compensatory general damages.
Damages & Quantum — Interest — Pre-Judgment Interest on Debt — Commercial Rate
Where a defendant has kept and used the plaintiff's money and benefited, the plaintiff is entitled to interest to compensate for being deprived of the use of the money. A rate of 25% per annum is not onerous where it is consistent with current market interest rates for commercial loans.
Civil Procedure — Ex Parte Proceedings — Substituted Service — Effect of Defendant's Non-Appearance
Where a defendant cannot be located at its last known address and is served by substituted service (advertisement in a newspaper) but fails to appear at the scheduling conference without explanation, the court may order the matter to proceed ex parte. Allegations in the written statement of defence that are not supported by evidence at trial are liable to be rejected.

Legislation cited (1)

  • Sale of Goods Act Cap. 82 s.35

Cases cited (3)

  • Stroms v Hutchinson [1905] AC 515
  • Thunderbolt Technical Services Ltd v Apedu & Another (HCT-00-CC-CS-340-2009)
  • Sietco v Noble Builders (SCCA No. 31 of 1995)

Full judgment

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

Superior Promotions & General Suppliers Ltd v ZK Advertising (U) Ltd (Civil Suit No. 424 of 2010) [2012] UGCommC 168 (21 December 2012)
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.