Wakilii

Waluya v Nakyejwe (Civil Suit No. 1215 of 2021)

High Court · [2023] UGHCLD 72 · 2023 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for breach of land sale agreement, heard exparte after defendant failed to file defence
Decision
Sale agreement terminated; defendant ordered to refund purchase price and pay damages and compensation to plaintiff

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that the defendant breached the land sale agreement by fraudulently selling land encumbered by a caveat without disclosure. The plaintiff was not entitled to the land due to his failure to conduct due diligence before purchase, but was entitled to a refund of the purchase price, compensation for developments made on the land, and general damages. The court terminated the sale agreement and ordered the defendant to refund UGX 50,000,000, pay special damages of UGX 255,000,000 for developments, and general damages of UGX 20,000,000, with interest at 15% per annum.

Outcome

Sale agreement terminated; defendant ordered to refund purchase price and pay damages and compensation to plaintiff

Facts

The plaintiff purchased land comprised in Busiro Block 444 Plot 2076 at Nkumba from the defendant for UGX 50,000,000 under a sale agreement dated 19th September 2020. The plaintiff took possession and began developing the property, spending UGX 255,000,000 on construction. He later discovered that the land was encumbered by a caveat lodged by one Kaggwa Charles on 26th June 2015, prior to the sale. The caveat prevented transfer of the title into the plaintiff's name. The defendant had not disclosed the caveat before the sale and, despite promising to remove it, failed to do so. The defendant was served but did not file a defence, and the matter proceeded exparte.

Issues

  1. Whether the defendant breached the agreement of sale between herself and the plaintiff.
  2. Whether the actions of the defendant in the present circumstances were fraudulent.
  3. Whether the plaintiff is entitled to the suit land.
  4. Whether, in the alternative, the plaintiff is entitled to a refund of monies paid as consideration to the defendant under the agreement of sale.
  5. Whether the plaintiff is entitled to compensation in the circumstances.
  6. Whether the plaintiff is entitled to any other remedies.

Orders

  • The defendant breached the sale agreement dated 19th September, 2020 in respect of the purchase of land comprised in Busiro Block 444, Plot 2076, at Nkumba.
  • The plaintiff is entitled to a refund of the consideration amount of UGX 50,000,000 paid to the plaintiff as the value of the land.
  • Special damages/compensation of UGX 255,000,000 awarded to the plaintiff.
  • General damages of UGX 20,000,000.
  • Interest in respect to orders 2, 3 and 4 (above), payable at a rate of 15% p.a. from date of delivery of this judgment till payment is made in full.
  • Costs of the suit.

Rules and key headnotes

Contract Law — Breach of Contract — Sale of Land — Vendor's Duty to Make Good Title
A contract for the sale of land implies an agreement on the part of the vendor to make good title to the property being sold. Where the vendor sells land encumbered by a caveat without disclosure and fails to remove the caveat to enable transfer, the vendor is in breach of the agreement of sale.
Tort Law — Fraud and Misrepresentation — Sale of Encumbered Land — Non-Disclosure of Caveat
Where a vendor represents that land has no encumbrances and knowingly enters into a sale agreement while aware of an existing caveat, such conduct constitutes fraudulent misrepresentation. Fraud includes suppression of truth and anything calculated to deceive, and comprises all acts, omissions and concealments demonstrating dishonesty.
Land & Property — Due Diligence — Buyer's Duty to Conduct Search
A prospective buyer of land must exercise due diligence by conducting a search on the title and making thorough inquiries before committing funds and developing the land. Due diligence extends beyond receiving the duplicate certificate of title and transfer forms from the vendor. A buyer who fails to conduct proper investigations before purchase bears part of the blame for subsequent difficulties.
Land & Property — Caveats — Effect on Transfer — Registration of Titles Act s.147
Under section 147 of the Registration of Titles Act Cap 230, no entry is to be made in the register book while a caveat remains in force. A caveat on land prevents transfer of title until it is removed.
Contract Law — Remedies for Breach — Termination and Refund — Unjust Enrichment
Where a vendor breaches a land sale agreement by selling encumbered land through misrepresentation, the court may terminate the agreement and order refund of the purchase price. The principle that no person shall take advantage of their own wrong prevents unjust enrichment of a party in breach who has received payment for land that cannot be transferred.
Tort Law — Damages — Special Damages — Compensation for Developments on Land
Where a buyer develops land in reliance on a fraudulent sale agreement and subsequently discovers the land cannot be transferred due to undisclosed encumbrances, the buyer is entitled to compensation for the value of developments made on the land. Special damages must be specifically pleaded and strictly proved.

Legislation cited (3)

Cases cited (9)

  • Ken Paper (E.A) Ltd v Registered Trustee of Kampala Archdiocese (HCCS No. 504 of 2012)
  • William Kasozi v DFCU Bank Ltd (HCCS No. 1326 of 2000)
  • Ronald Kasibante v Shell Uganda Ltd (HCCS No. 542 of 2006)
  • Frederick J.K. Zaabute v Orient Bank & 5 Ors (SCCA No. 4 of 2006)
  • Kampala Bottlers Ltd v Dominico Ltd (SCCA No. 22 of 1992)
  • Sir Bagelre v Ausi Matovu (CA No. 1 of 1996)
  • Nabro Properties Ltd vs. Sky Structures Ltd. & 2 others [2002] 2 KLR at page 299
  • Hellen Ochan v Odur Wills (HCCA No. 50 of 2019)
  • Okello Dafala Valente vs The Attorney General of Uganda

Full judgment

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

Waluya_v_Nakyejwe_(Civil_Suit_No._1215_of_2021)_[2023]_UGHCLD_72_(20_March_2023)
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.