Wakilii

Webster Construction Equipment Co. Ltd v Nino Engineering Co. Ltd (HCT-00-CC-CS 324 of 2007)

High Court · [2007] UGCOMMC 90 · 2007 Judgment for Plaintiff (Partly Allowed) AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of outstanding moneys on a hire contract; judgment entered in default of filing defence
Decision
Judgment entered for the plaintiff; defendant liable for special damages of Shs.6,600,000, general damages of Shs.500,000, interest, and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that where a hirer fails to pay the balance of the hire price after the agreed period and the owner continues to provide services despite the breach, the owner must mitigate loss by terminating the contract. The plaintiff was entitled to recover the unpaid balance of the contract price, operator fees, and transport costs, but not damages for the extra period worked beyond the contract period as the plaintiff failed to mitigate its loss.

Outcome

Judgment entered for the plaintiff; defendant liable for special damages of Shs.6,600,000, general damages of Shs.500,000, interest, and costs

Facts

The plaintiff company hired out its motor grader to the defendant company for 15 days at Shs.9,000,000. The defendant paid half the agreed sum at signing; the balance was due after seven days. The grader was delivered on 28 October 2006 and work commenced on 29 October 2006. After seven days, the plaintiff demanded the balance of Shs.4,500,000 but the defendant failed to pay. Work continued until 17 November 2006, five days beyond the contractual period. The defendant also failed to pay the operator fees of Shs.300,000 and the return transport cost of Shs.1,800,000, both of which were the defendant's responsibility under the agreement. The suit was filed on 10 May 2007. Judgment was entered in default of defence after the defendant failed to respond despite proper service.

Issues

  1. Whether there was a contract between the plaintiff and the defendant for hire of a motor grader.
  2. Whether the defendant breached the hire agreement by failing to pay the outstanding balance.
  3. Whether the plaintiff was entitled to damages for the extra period beyond the contractual 15 days.
  4. What quantum of special and general damages should be awarded to the plaintiff.

Orders

  • Special damages of Shs.6,600,000 awarded to the plaintiff.
  • General damages of Shs.500,000 awarded to the plaintiff.
  • Interest on special damages at court rate from the date of filing the suit till payment in full.
  • Interest on general damages at court rate from the date of judgment till payment in full.
  • Costs of the suit awarded to the plaintiff.

Rules and key headnotes

Breach of Contract — Duty to Mitigate Loss
Where a party breaches a contract by failing to pay at an early stage, the injured party must mitigate loss by taking reasonable steps to protect its own interest, including terminating the contract if the breach demonstrates proclivity for non-performance.
Special Damages — Recovery Limited by Failure to Mitigate
A plaintiff who continues to provide services beyond the contract period after the defendant exhibits clear breach cannot recover damages for that extra period if the plaintiff took an unnecessary risk by not terminating the contract.
General Damages — Assessment for Contract Breach
General damages for breach of contract are awarded to compensate the plaintiff for inconvenience and loss of work, not to punish the defendant, and the quantum is within the discretion of the court.
Interest — Discretionary Award for Deprivation of Money
Interest is a discretionary remedy awarded when a wrongdoer deprives the other party of money needed for business, compensating for loss of use from the date of filing suit to payment, as mere recovery of the principal sum is insufficient.

Full judgment

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

Webster Construction Equipment Co. Ltd v Nino Engineering Co. Ltd (HCT-00-CC-CS 324 of 2007) [2007] UGCommC 90 (11 November 2007)
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.