Wakilii

Twesigye v Cairo Bank Limited (Civil Suit 70 of 2017)

High Court · [2024] UGCOMMC 72 · 2024 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 arising from sale of mortgaged land
Decision
Plaintiff granted declaration of breach, special and general damages totalling UGX 28,000,000, interest and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that the defendant bank breached the contract of sale when it failed to deliver vacant possession immediately after the plaintiff paid the agreed down payment, despite making an unequivocal promise in Clause 7 of the contract. The defendant's awareness of an occupant's resistance to eviction did not excuse the breach. Special damages of UGX 8,000,000 awarded for extra rent paid. General damages of UGX 20,000,000 awarded for mental distress. Costs awarded to the plaintiff.

Outcome

Plaintiff granted declaration of breach, special and general damages totalling UGX 28,000,000, interest and costs

Facts

On 24 November 2016, the plaintiff purchased mortgaged land from the defendant bank through its agent Kanu Auctioneers for UGX 270,000,000. The contract provided that the vendor would deliver vacant possession immediately upon payment of the first installment of UGX 200,000,000. The plaintiff completed this payment by 1 December 2016. Both parties were aware that the land was occupied by Kakooza Musa, agent of the former mortgagor. The defendant had issued a notice to vacate on 4 October 2016 which Kakooza ignored. Despite the plaintiff's payment, the defendant failed to deliver vacant possession. The plaintiff filed suit on 1 February 2017. The defendant instituted separate proceedings against the occupant and obtained a vacant possession order in July 2017. The plaintiff obtained actual possession on 4 September 2017, nine months and four days after it should have been delivered. During this period, the plaintiff's family remained in rented accommodation, requiring payment of additional rent.

Issues

  1. Whether the defendant breached the contract of sale of the suit land dated 24th November 2016.
  2. Whether the plaintiff borrowed money from the bank to purchase the suit land.
  3. Whether the defendant is liable to the plaintiff for the expenses incurred arising from the contracts between the plaintiff and 3rd parties.
  4. What remedies are available to the parties.

Orders

  • A declaration that the defendant breached the contract for the sale of the suit land dated 24th November 2016 doth issue.
  • The defendant shall pay special damages of UGX 8,000,000/= (Uganda Shillings Eight million) to the plaintiff.
  • The defendant shall pay general damages of UGX 20,000,000/= (Uganda Shillings Twenty million) to the plaintiff.
  • The defendant shall pay interest to the plaintiff on the special damages at the rate of 18% p.a. from 1st August 2017 until payment in full and on the general damages at the rate of 13% p.a. from the date of judgment until payment in full.
  • Costs of the suit are awarded to the plaintiff.

Rules and key headnotes

Breach of Contract — Definition and Elements
Breach of contract occurs when one or both parties fail to fulfil the obligations imposed on them by the contract, conferring a right of action for damages on the injured party.
Contractual Obligations — Unequivocal Promises — Performance Subject to Known Impediments
Where a vendor makes an unequivocal contractual promise to deliver vacant possession immediately upon payment, the vendor cannot rely on a known occupant's resistance as an excuse for non-performance, even where both parties were aware of the occupant at the time of contracting. If unable to guarantee performance, the vendor should either refrain from making the promise or expressly condition it on successful eviction.
Damages for Breach — Expenses Incurred from Third-Party Contracts — Privity of Contract
Section 61(1) of the Contracts Act 2010 permits an injured party to recover compensation for losses resulting from breach, including expenses incurred and paid to third parties as a consequence of the breach. Such recovery does not violate privity of contract principles where the plaintiff seeks reimbursement for expenses already paid, rather than direct enforcement of third-party contracts against the defendant.
Special Damages — Requirement of Pleading and Proof
Special damages must be specifically pleaded and proved, but strict proof does not require documentary evidence in all cases. Where a plaintiff claims special damages for extra rent paid due to delayed possession, receipts and bank statements evidencing actual payment are sufficient proof for the months covered by such documentation.
General Damages — Assessment Principles — Mental Distress from Contractual Breach
General damages are awarded at the court's discretion based on the value of the subject matter, the economic inconvenience suffered, and the nature and extent of injury. In assessing general damages for breach of a land sale contract, the court considers the period of delay in delivering possession, the plaintiff's awareness of potential difficulties, and the mental and emotional distress naturally flowing from the breach.
Damages — Self-Help Measures — Recoverability of Costs
Where a contract expressly places the duty of delivering vacant possession on the vendor, the purchaser cannot recover costs incurred in hiring their own bailiffs to secure possession through self-help measures. The purchaser's proper recourse is to remind the vendor of the contractual duty or to sue for breach, not to undertake execution independently.

Legislation cited (5)

Cases cited (10)

  • Mogas Uganda Limited v Benzina Uganda Ltd (High Court Civil Suit No. 88 of 2013)
  • Mwesigye Warren v Kiiza Ben (High Court Civil Suit No. 320 of 2015)
  • Miller v Minister of Pensions [1947] 2 All ER 372
  • Stanbic Bank (U) Ltd v Hajji Yahaya Sekalega t/a Sekalega Enterprises (High Court Civil Suit No. 185 of 2009)
  • Opia Moses v Chukia Lumago Roselyn & 5 Ors (High Court Civil Suit No. 22 of 2013)
  • Hadley v Baxendale (1854) 9 Exch 341
  • Uganda Commercial Bank v Kigozi [2002] 1 EA 305
  • Bank of Uganda v Fred William Masaba & 5 Ors (Supreme Court Civil Appeal No. 3 of 1998)
  • Mohanlal Kakubhai Radia v Warid Telecom Uganda Ltd (High Court Civil Suit No. 224 of 2011)
  • Kwizera Eddie v Attorney General (Supreme Court Constitutional Appeal No. 1 of 2008)

Full judgment

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

Twesigye v Cairo Bank Limited (Civil Suit 70 of 2017) [2024] UGCommC 72 (31 January 2024)
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.