Wakilii

Uganda National Roads Authority v Kaaya L. Enterprises Limited (Civil Suit 836 of 2016)

High Court · [2022] UGCOMMC 182 · 2022 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 and recovery of damages
Decision
Judgment entered for the Plaintiff with declarations, damages, interest, and costs awarded

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that the doctrine of frustration did not apply where the defendant's own negligence and delay in clearing goods led to their auctioning by Kenya Ports Authority. The defendant breached the contract by failing to deliver all goods paid for. The plaintiff was awarded special damages of USD 21,756.10, liquidated damages of USD 3,554.26, general damages of UGX 20,000,000, interest at court rate, and costs.

Outcome

Judgment entered for the Plaintiff with declarations, damages, interest, and costs awarded

Facts

On 28 June 2011, the plaintiff entered into a contract with the defendant for the supply and delivery of ground engaging tools for USD 117,713, with delivery within 3 months. The plaintiff paid 70% (USD 124,399.10) upon presentation of shipping documents. The defendant made two partial deliveries worth USD 102,643 but failed to deliver goods worth USD 21,756.10. The goods arrived at Mombasa Port on 18 December 2011. Despite reminders from clearing agents in February and March 2012, the defendant delayed clearing the goods. The defendant received shipping documents on 25 May 2012 but by then the goods had accumulated demurrage. One container was auctioned by Kenya Ports Authority on 20 June 2012 due to non-payment of storage fees. The defendant blamed delays on Kenya Commercial Bank's failure to remit contract funds and sought waivers for demurrage. The plaintiff assisted in attempts to recover the auctioned goods.

Issues

  1. Whether the contract between the parties was frustrated?
  2. Whether the Defendant breached the agreement between the parties dated 28th June 2011?
  3. What remedies are available to the parties?

Orders

  • A declaration that the Defendant is in breach of the agreement between the parties dated 28th June 2011.
  • Special damages of USD 21,756.10 are awarded to the Plaintiff.
  • Liquidated damages of USD 3,554.26 is awarded to the Plaintiff.
  • General damages of UGX 20,000,000 is awarded to the Plaintiff.
  • Interest at court rate on the special damages and liquidated damages from the date of breach till payment in full, and interest at court rate on general damages from the date of judgement till payment in full.
  • Costs of the suit to be paid to the Plaintiff.

Rules and key headnotes

Frustration of Contract — Impossibility of Performance — Negligence of Party
The doctrine of frustration does not apply where the impossibility of performance was caused by the negligence or default of the party pleading frustration, rather than by an intervening act or circumstance beyond the control of either party.
Frustration — Force Majeure — Foreseeable Events
An event does not constitute force majeure under a contract where it was foreseeable and could have been avoided by the party claiming discharge, such as tax clearance obligations and port storage fees that accumulate due to delay in clearing goods.
Breach of Contract — Failure to Deliver Goods
A supplier breaches a contract for the supply of goods where, having received payment, it fails to deliver all the goods contracted for, regardless of whether the failure was caused by third parties, where the supplier's own negligence contributed to the circumstances preventing delivery.
Liquidated Damages — Delay in Performance — Interpretation of Contract Clauses
Where a contract provides for liquidated damages calculated on the total bid price for failure to deliver any or all supplies within the specified period, such damages apply irrespective of whether only partial payment has been made, where the parties contemplated payment in instalments.
Special Damages — Proof — Admitted Facts
Where a defendant admits in pleadings and evidence that it received payment for goods which were not delivered, and fails to produce evidence to controvert the plaintiff's claim of loss, the plaintiff has proved its claim for special damages without need for documentary evidence.
General Damages — Assessment — Inconvenience and Delay
In assessing general damages for breach of contract, the court considers the extent of the breach, the hardship and inconvenience endured by the plaintiff, and the impact of delay on the plaintiff's operations, with the aim of placing the plaintiff in the position they would have been in had the breach not occurred.

Legislation cited (2)

  • Contracts Act No. 7 of 2010 s.66(1)
  • Contracts Act No. 7 of 2010 s.66(2)

Cases cited (9)

  • Bokiso Cargo Transporters Co. Ltd v Wakiso District Local Government Council & AG (High Court Civil Suit No. 070 of 2004)
  • Krell v Henry [1903] 2 KB 740
  • Taylor v Caldwell (1863) 3 B & S 826
  • Mogas (U) Ltd v Benzina (U) Ltd (High Court Civil Suit No. 88 of 2013)
  • Clothlink (U) Ltd v African Trade Investments Ltd (Civil Suit No. 234 of 2010)
  • Kyambadde W.M v Mpigi District Administration [1983] HCB 44
  • Lukwiya Roy and Otur Wanglonyi v Santa Sarah Ochan (Civil Appeal No. 0086 of 2018)
  • KLM Royal Dutch Airlines v Katwine International Shipping Ltd (High Court Civil Suit No. 471 of 2014)
  • James Fredrick Nsubuga v Attorney General (High Court Civil Suit No. 13 of 1994)

Full judgment

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

Uganda National Roads Authority v Kaaya L. Enterprises Limited (Civil Suit 836 of 2016) [2022] UGCommC 182 (30 November 2022)
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.