[2022] UGHCLD 223

# THE REPUBLIC OF UGANDA

# IN THE HIGH COURT OF UGANDA AT KAMPALA

#### [LAND DIVISION]

# HCCS. NO. 058 OF 2021

**BUKENYA VINCENT**

<table><tbody>T/A MC DON KINDERGARTEN & DAY CAREPLAINTIFF / COUNTER - DEFENDANT</tbody>

$\mathsf{V}$

**SAJJAD BUTT**

DEFENDANT / COUNTER - CLAIMANT

# BEFORE: HON. LADY JUSTICE P. BASAZA - WASSWA

### **JUDGMENT**

Representation:

Mr. Asodio Jordan for the Plaintiff.

Mr. Lugayizi Timothy for the Defendant.

#### Introduction:

On January 29, 2021 Mr. Bukenya; the Plaintiff / Counter- Defendant, sued Mr. $[1]$ Butt; the Defendant / Counter-claimant; in respect of a tenancy on property described as Plot 11 Kanjokya street, in Kampala District. (Hereinafter referred to as 'the suit premises') Macmil mm 31/10

$\mathbf{1}$

- The duo executed a tenancy agreement dated October 10, 2016 (PEX. 2), by $[2]$ which Mr. Bukenya, who carries on business under the name of his school; McDon Kindergarten & Day Care, rented the suit premises from Mr. Butt, for a term of six (6) years commencing on November 1^st 2016 to October 31, 2022. - Four (4) years into the tenancy, following a notice from Mr. Butt to Mr. Bukenya $[3]$ dated October 20, 2020 (PEX 8 also DEXH 3), disagreement ensued between the duo, resulting into the present suit. - For clarity, although the said notice (PEX 8 also DEXH 3), was titled 'NOTICE OF $[4]$ **SALE OF PROPERTY...'**, the same was essentially a termination notice. In that notice Mr. Butt required Mr. Bukenya to vacate the suit premises by January 31, 2021 to pave way for a potential new owner with whom he (Butt) was allegedly in advanced negotiations. It also contained a demand for alleged rental arrears of **USD \$ 15,000**. For ease of reference, the said notice shall here in be termed 'the termination notice'

#### The Plaintiff's case:

- $[5]$ The gist of Mr. Bukenya's case, as shown in his plaint is; - $(a)$ That by the termination notice (PEX 8), Mr. Butt unilaterally and unlawfully terminated the tenancy agreement without regard to its terms, and to the Government Policy on lock - down that affected his (Bukenya's) business.

Mask wh mm 31/10

$\overline{2}$

- That he injected substantial sums in the suit premises to the tune of UGX. $(b)$ 250,000,000/= (Two hundred and Fifty Million) to up lift the suit premises, and that as such he shall suffer irreparably if Mr. Butt is allowed to prematurely and unjustifiably terminate the tenancy agreement. - That by the time of the country wide lock down by Government to curb $(c)$ the COVID -19 pandemic, he had not defaulted in rent payments in any way, and had religiously paid his rental obligations, and by March 2020 he had paid up to April 2020. - That he shall pay off all rental arrears the moment the school resumes, $(d)$ which is expected in March 2021. - $[6]$ Mr. Bukenya seeks *inter alia*; - A declaration that the termination notice (PEX 8) is null and void and $(a)$ amounts to a breach of contract. - $(b)$ An award of general damages and costs of this suit.

#### The Defendant's case:

- In answer, in his written statement of defence, Mr. Butt denies the said $[7]$ allegations, and contends (the gist); - $(a)$ That Mr. Bukenya did not make any improvements or alterations to the suit premises, and that in any event, such improvements or alterations, if

Maschell ann 31/10

$\overline{3}$

at all, are not to be compensated by him (Butt) by virtue of para. 4 (I) of the agreement. That he did not agree to compensate Mr. Bukenya for them.

- That Mr. Bukenya has defaulted in payment of rent since March 2020 and $(b)$ is in arrears of USD 21,000 from March 2020 to April 2021. - That the nationwide lock down in March 2020 also affected his (Butt's) $(c)$ business and he is at liberty to re-enter the suit premises pursuant to para. 6(b) of the tenancy agreement and to terminate the tenancy pursuant to para. $6(g)$ thereof. - That by his letter dated December 17, 2020 he offered Mr. Bukenya a $(d)$ waiver of the rental arrears if Mr. Bukenya had peacefully vacated the suit premises by December 30, 2020. That Mr. Bukenya refused to peacefully vacate the suit premises, refused to pay the outstanding rent, and continues to be in default. That he has since exercised his right of distress under the law and has obtained an order permitting distress for rent vide Misc. Cause No. 25 of 2021. - By way of a counterclaim, Mr. Butt contends that Mr. Bukenya is in breach of the [8] tenancy agreement for allegedly not paying rent from March 2020 to April 2021, amounting to USD \$ 21,000, and seeks;

Masalul amm 31/10

$\overline{4}$

- Rental arears of USD \$ 21,000 plus USD \$ 6,000 for the additional period $(a)$ from January 2021 to April 2021. - $(b)$ General damages and costs of the suit. - [9] In answer, Mr. Bukenya denies being in breach and contends that he is not in any arears. He further contends that he paid rent up to April 2020, and is willing to pay off all arears (sic), save for the time during the lock - down.

#### Issues for determination:

- $[10]$ The following issues were agreed upon; - $1.$ Whether there was a lawful termination of the tenancy by the Defendant? - $2.$ Whether there was any breach of the tenancy agreement by either party? - Whether the parties are entitled to the remedies sought in their 3. respective pleadings? - Before I determine the issues, there are two aspects that I must deal with first. $[11]$

The first aspect is the validity of the proceedings and Ruling in Misc. Cause No. 025 of 2021 in the Chief Magistrates Court of Mengo.

The second aspect is an objection raised by the Plaintiff's Counsel, in his written submissions, against the competence of the defence witness; Ms. Ajambo Caroline.

Maralle Wurm 31/10

- Misc. Cause No. 025 of 2021 was brought to this Courts attention in this present $[12]$ In that Misc. Cause, a one John Baptist Wasswa T/A Trust General suit. Auctioneers, a Court Bailiff, sought for, and was granted a special certificate for distress against Mr. Bukenya's / (McDon Kindergarten & Daycare's) movable property at the suit premises. That order was purportedly issued to recover rent of USD \$ 15,000 said to be due to Mr. Butt. (Refer to the Magistrates Court's Ruling dated March 17, 2021 (marked as DEXH6 in the trial Bundle). - The proceedings and Ruling in that Misc. Cause, were filed by the Bailiff claiming $[13]$ under and or acting on behalf of Mr. Butt against Mr. Bukenya / his school. They are thus proceedings and a Ruling conducted and concluded despite the existence of three previously instituted suits; the present suit HCCS No. 58 of 2021 and its two daughter suits; Misc. Applications Nos. 119 & 120 of 2021, that are over the same matter, and are between the same parties, or between parties under whom they or any of them claim.

#### $[14]$ It is trite law (sec. 6 of the CPA) that;

'No Court shall proceed with the trial of any suit or proceeding in which the matter in issue is also directly and substantially in issue in a previously instituted suit or proceeding between the same parties, or between parties under whom they or any of them claim, litigating under the same title, where that suit or proceeding is pending in the same or any other court having jurisdiction in Uganda to grant the relief claimed'.

(Underlining mine for emphasis)

Mashmum 31/10

I note that in Misc. Applic. No. 025 - 2021, the existence of the said prior suits, $[15]$ was brought to the attention of the learned trial Magistrate by the Respondent in the his affidavit in reply, but the Magistrate misdirected himself and elected to go ahead to consider and determine that Misc. Cause in clear contravention of sec. 6 of the Civil Procedure Act¹. He erroneously stated in his Ruling² that, I quote;

"... I note that the case before the High Court of which the first page of the plaint is attached on (sic) the affidavit in reply show that the plaintiff seeks orders including payment of rent compensation for improvement made on the property but nothing therein to suggest that there is a contention on payment or nonpayment of the reserved rent, and even if it was so, there is no order from the high court yet to restrain the applicant and no order to stay proceedings in this matter'

It is now settled that once an illegality, such as this, is brought to the attention $[16]$ of court, it cannot be allowed to stand. Courts cannot sanction what is illegal.

## See Makula International v His Eminence Cardinal Nsubuga³.

- In these circumstances, I accordingly, hereby set aside the said illegal $[17]$ proceedings and Ruling in Misc. Cause. No. 025 – 2021 in the Chief Magistrate's Court of Mengo. - $[18]$ I will now turn to address the second aspect.

Mr. Asodio, learned Counsel for the Plaintiff, raised an objection in his written submissions against the competency of the Defence witness; Ms. Ajambo Mashmill mm 31

³ [1982] HCB 24

$1$ Cap 71

^&lt;sup>2</sup> Ruling in Misc. Cause. No. 025 of 2021 at page 3

Caroline. He argued that Ms. Ajambo who appeared as DW1 had no *locus standi* to adduce evidence on behalf of, and to represent Mr. Butt. He stated that the defence did not execute nor annex a power of attorney from Mr. Butt authorizing M/s Knight Frank or DW1 to adduce evidence on his behalf. For his proposition, learned Counsel referred court to PEX 15, and relied on sec. 146 of the RTA and Order 3 rule 1 of the CPR.

- $[19]$ In answer, Mr. Lugayizi learned Counsel for the Defendant argued that DW1 is an employee of M/s Knight Frank (U) Ltd, as stated in her witness statement, and that she gave evidence in that capacity. That Knight Frank is the Property Manager / agent of the Defendant in respect of the suit premises, which fact is not in dispute. That there is no Rule of law that evidence in a matter must be led by only the parties to the suit. For his proposition, learned Counsel relied on: Housing Finance Bank Ltd v Silk Events Ltd⁴. - It is surprising to me that after closure of both the Plaintiff's and the Defendant's [20] cases, at the stage of written submissions, learned Counsel Mr. Asodio raised this objection. An objection of this nature ought to have been brought when the witness statement of the witness under reference, in this case DW1, was tendered in Court. It is not an objection that can be raised after a witness's ALGANW MM 31/10

^&lt;sup>4</sup> H/C C/Appeal No. 300 of 2021

testimony was duly taken as her evidence in chief, and after the closure of the case of each side.

- $[21]$ As it were, during the trial, and in particular, at the time the evidence of DW1 was rendered, Mr. Asodio had no objection to DW1's witness's statement, nor to her competence as a witness. He now cannot be allowed to renege on his earlier position and say that DW1 had no authority to testify. It is way too late. - $[22]$ That said, in addition, in paragraph 2 of DW1's witness statement, she stated that Knight Frank (U) Ltd is the property Manager / Agent of Mr. Butt. That she (DW1), as a senior Property Manager with that company, tasked with the supervision and management of the suit premises, is conversant with the facts of the case, and is as such authorized to give evidence on Mr. Butt's behalf. - I found no other evidence before this court, that would rebut the above [23] evidence, which was itself corroborated by numerous prior correspondences written on behalf of the Defendant by M/s Knight Frank (U) Ltd, that were exchanged with the Plaintiff.

I therefore find no merit whatsoever in Mr. Asodio's objection, that I accordingly overrule.

$[24]$ I will now turn to address the issues in this case.

Maximillum 31/10 #### Determination of issues:

## Issues No. 1 and No. 2 (determined jointly):

# Whether there was a lawful termination of the tenancy by the Defendant? Whether there was any breach of the tenancy agreement by either party?

The allegations in this suit that are leveled by each party against the other of $[25]$ breach of the tenancy agreement, are allegations that encircle the main question of rent payment / non-payment.

On one hand, Mr. Butt asserts that on account of Mr. Bukenya's alleged failure to pay rent he was entitled, under clause 6 (b) & (g) of the tenancy agreement, to terminate the tenancy agreement. While on the other hand, Mr. Bukenya asserts that Mr. Butt terminated the tenancy agreement allegedly unlawfully without regard to its terms, and to the Government Policy on lock - down that affected his (Bukenya's) business. That he is willing to pay off all rent arears, save for the time during the lock - down.

[26] Suffice it to say that this Court takes Judicial Notice that during the tenancy term in this case, pursuant to sections 11 and 27 of the Public Health Act⁵ and the Public Health (COVID -19) Rules made thereunder, the Government of Uganda intermittently imposed *inter alia*; nationwide lock – downs from March 2020 to December 2021 (both months inclusive), in an effort to curb the spread of the $\frac{1}{5} \frac{1}{\text{Cap } 281}$

unprecedented COVID -19 virus. All national and private schools and institutions of higher learning were closed for a total of twenty (22) months⁶. This was with the exception of virtual classes conducted by schools and or institutions that were able to offer them. The schools and institutions only resumed normal operations in January 2022. For ease of reference, the said twenty (22) months of lock - down shall hereinafter be referred to as 'the period of lock-down'.

- It is against the backdrop of the period of lock-down that the real question in $[27]$ controversy in this suit arises, to wit; 'whether the doctrine of frustration of contract applies to this case? - This court has to determine; 'on whom should the burden of payment or non-[28] payment of rent for the period of lock-down fall? Should the burden be borne by Mr. Butt, the Landlord? Or by Mr. Bukenya, the tenant? Should Mr. Butt be deprived of his rental earnings for the period of lock - down? Or should Mr. Bukenya pay the rent for that period anyway? - Mr. Bukenya (PW1), testified that the period of lock-down heavily affected his [29] business and the performance of the tenancy agreement, which he said was beyond his control.

Machill mm 31/10

^&lt;sup>6</sup> For the cumulative period of 22 months during the intermittent lock-downs, schools remained closed and could only offer virtual classes.

He stated that through M/s Knight Frank (U) Ltd Relationship Managers; a one Charles Lwanga and a one Sandra Iramukunda, he repeatedly requested Mr. Butt for a waiver of rent for that period. That he sought a waiver to be allowed to pay 50% of the rent, and undertook to thereafter resume normal payments. That the said relationship managers kept him hopeful that Mr. Butt would approve his request for a waiver. That while he waited for the waiver, with shock, he received the termination notice, to which, he said he replied by his letter dated October 26, 2020 (PEX 9 also DEX H 4).

- He (PW1) further testified that prior to the period of lock down, he had not $[30]$ defaulted in paying his rent. That the last rent payment he made to Mr. Butt was for the period February 1, 2020 to April 30, 2020. That he made that payment in March 2020, just before the onset of the period of lock - down. To support this assertion, he produced a tax invoice (**PEX 6**) and a receipt (**PEX 7**) from M/s Knight Frank (U) Ltd for the sum of **USD \$ 4,500.** He however admitted that he had not paid any rent for the period after April 2020, to the date of his testimony. - $[31]$ On her part, Ms. Ajambo (DW1) testified that by their (M/s Knight Frank (U) Ltd) letter dated December 17, 2020 (DEXH. 5 also PEX. 11), Mr. Butt offered a waiver of the rental arrears, on condition that Mr. Bukenya peacefully vacated the suit premises by January 31, 2021. That Mr. Bukenya refused to peacefully vacate the suit premises, refused to pay outstanding rent, and continues to be in Mashul umm 3/ 10 12

That Mr. Bukenya has caused Mr. Butt loss and damage, including default. frustrating the intended sale of the suit premises.

She (DW1) further stated that by March 2020 and before, Mr. Bukenya was in $[32]$ rent arrears of three (3) months of USD \$ 4,500. She asserted that Mr. Butt's business was also affected by the period of lock - down, and that he was entitled to re-enter the suit premises and to terminate the tenancy agreement pursuant to clauses 6 (b) & (g) of the tenancy agreement. She (DW1) produced a rent statement (DEXH. 8) that shows that rent of USD \$ 47,428.33 is allegedly due from Mr. Bukenya, as at March 1, 2022 this year. She however acknowledged that the last rent payment that Mr. Bukenya made was on March 1, 2020 of USD \$ 4,500 for the period; March 1, 2020 to April 30, 2020. She also admitted that M/s Knight Frank (U) Ltd did not issue a demand for rent arrears before the period of lock - down.

#### Submissions of Counsel:

Learned Counsel for each party filed written submissions that I have duly [33] considered together with the authorities they each rely on. For brevity, I have not captured all their arguments here, but I have made reference to only the vital portions. See paras. [37] - [39] below, (both inclusive).

Macamel ummy 31/10

### Analysis by Court:

In cases such as the present case, the tests to be applied to determine 'whether $[34]$ the doctrine of frustration of contract should apply, are;

First, having regard to all the circumstances, what was the foundation of the contract?

Second, was the performance of the contract prevented? (In this case, was the performance of the contract prevented by the period of lock - down?)

Third, was the event which prevented the performance of the contract of such a character that it cannot reasonably be said to have been in the contemplation of the parties at the time the contract was made?

If all these questions are answered in the affirmative, both parties are discharged from further performance of the contract. (these tests are Adopted from **Krell** v Henry $7$ )

[35] The doctrine of frustration of contract is defined in **Black's Law Dictionary**⁸ to the effect that;

Magnill umm 3/10

^&lt;sup>7</sup> Court of Appeal [1903] 2 KB 740 cited in the text: Smith & Thomas, a case book on Contract 13^th ed. a Sweet & Maxwell publication (2015), at p. 850-852 paras. 24-006. ⁸ 9^th ed. at page 740

'... If a party's principal purpose is substantially frustrated by unanticipated changed circumstances, that party's duties are discharged, and the contract is considered terminated. Also termed frustration of purpose, Impossibility, impracticability, mistake.'

## The doctrine is re-stated in our law under section 66 (1) of the Contract Act, 2010 [36] to the effect that;

'Where a contract becomes impossible to perform or is frustrated and where a party cannot show that the other party assumed the risk of impossibility, the parties to the contract shall be discharged from the further performance of the contract'

- [37] It is submitted for the Plaintiff by learned Counsel Mr. Asodio; - a) That Mr. Bukenya's failure to pay rent was due to the Government policy imposed over the period of lock – down, which he argued, was an intervening factor beyond Mr. Bukenya's control, thereby rendering the performance of the tenancy agreement frustrated. - b) That Mr. Bukenya ought to be discharged from performing the obligation to pay rent for the period of lock - down, or at least be allowed to pay rent for the period at a discount of up to 50% as he was promised by the relationship managers.

For this proposition, learned Counsel relied on **sec. 66 (1) of the Contracts** Act, 2010. Phoseul mm 31/10

- c) That the grounds for the termination notice by Mr. Butt were arbitrary considering the circumstances at the time, and the same was in breach of the terms of the tenancy agreement. - [38] In rebuttal, learned Counsel Mr. Lugayizi, submitted for the defendant; - a) That Mr. Bukenya's excuse for not paying rent since May 2020 is because of the period of lock – down, but gives no indication of how long his business was affected. - b) That by virtue of the case of National Carriers Ltd vs. Panalpina (Northern) **Ltd**⁹, Mr. Bukenya cannot avail himself the defence of frustration as a result of the period of lock - down. That the agreement did not provide for such an option, and the obligation to pay rent was unconditional. That in any event, Mr. Bukenya remained in occupation of the suit premises throughout the lock – down period, so he cannot argue that the contract was frustrated. - c) That Mr. Butt did not breach the agreement by issuing the termination notice or otherwise. It was Mr. Bukenya who breached the agreement by ignoring a lawful termination notice and by failing to pay rent as agreed in the agreement for the period May 2020 to date. - d) That it neither matters how long the tenancy has run, nor does it matter what improvements Mr. Bukenya made to the suit premises. Mr. Butt did not need a satisfactory reason to terminate the tenancy, nor did he need Mr. Missimal min $31/16$

⁹ [1981] 1 All ER 161

Bukenya's permission to sell the suit premises. That the latter only owed Mr. Bukenya a notice of termination, which was lawfully issued.

- [39] By rejoinder, Mr. Asodio relied on sec. 33 (1) of the Contracts Act and cited the case: Daniza Ltd and D. Light Design Uganda Ltd¹⁰, and argued that one can rightly state that the pandemic and presidential restriction qualified as circumstances beyond the control of the Parties envisaged under sec. 66 of the **Contracts Act.** That Mr. Bukenya must be discharged from the obligation to pay rent for the period of lock - down. - [40] It is vital to note here, that the tenancy agreement in this present case does not contain a *Force - Majeure Clause*¹¹. Therefore, there are no circumstances expressly identified by the warring parties to this suit that would be treated as excusing conditions for non-performance. Neither is there provision for apportionment This scenario, and the other facts of this case, are of any such risk. distinguishable from the scenario and facts in the Daniza Ltd Arbitration case (supra) cited by Mr. Asodio, in which the Master Lease Agreement contained a Force - Majeure Clause.

MASHMW umm 31/10

^&lt;sup>10</sup> Arbitration Cause No. PCCL / ARB / 03 /22

^&lt;sup>11</sup> A *Force - Majeure clause* is defined in Black's Law Dictionary, 9^th ed. at page 718 as a contractual provision allocating the risk of loss if performance becomes impossible or impractical, esp. as a result of an event or effect that the parties could not have anticipated or controlled. The term *force* – *majeure* includes both acts of nature (e.g., floods and hurricanes) and acts of people (e.g., riots, strikes, and wars).

- For context and clarity, before I apply the said three tests in the Krell v Henry $[41]$ case (supra), I have here below laid out the pertinent terms of the tenancy agreement in this case; - Clause 3 The landlord hereby lets to the tenant and the tenant hereby rents the premises for a term of six (6) years commencing on November 1, 2016 to October 31, 2022 paying a monthly rent of USD 1,500 (United States Dollars One Thousand Five Hundred), net of VAT and any other taxes that may be chargeable thereon, payable three (3) months in advance, and subject to a 7% escalation per annum. - Clause $5(d)$ That the tenant paying the rent hereby reserved and performing and observing the covenants and conditions hereby contained or implied and on their part to be performed and observed shall and may quietly possess and enjoy the premises without any interruption from or by the Landlord or any person rightfully claiming from or under him. - Clause $6(b)$ If the rent hereby reserved shall be in arrears for a period of 21 (twenty - one) days from the due date of remission whether formally demanded or not, the landlord shall be at liberty at any time thereafter to re-enter into the premises without first applying to court and following a period of seven days' notice in writing to levy distress on the tenant's property to recover the unpaid rent and incidental costs. - Upon the desire to terminate this tenancy at any point during the term either Clause $6(q)$ party wishing to do so shall give a minimum of three (3) months' notice in writing to the other party which notice shall serve to negate any requirement for compensation of the other party upon grounds of the term of the agreement...' - $[42]$ After reading the authorities cited by both learned Counsel, and after very careful consideration of the facts of this case, and the law, I hold the view that while Mr. Bukenya has made out a legitimate claim that the period of lock – down heavily affected his business, and his performance of the terms of the tenancy Marahamm 3/10 agreement, I find that the reason he gives for not paying rent, does not satisfy all the said three (3) tests in the Krell case (supra).

- Clearly although the period of lock down made the performance of the $[43]$ contract very difficult / burdensome for Mr. Bukenya, it cannot be said to have rendered the performance of the contract impossible, or impracticable. - It is my considered view that since there was no erosion of the suit premises, nor $[44]$ was there extreme damage to them so as to render them uninhabitable, and similarly, since there was no interruption of continued occupation thereof by Mr. Bukenya and his school, the performance of the contract was not rendered impossible.

The above truth is amplified by Mr. Bukenya's election not to take Mr. Butt's offer of a waiver¹² (see DEXH. 5 also PEX. 11), however vague and non-committal the offer may appear to have been. Demonstrably both the uninterrupted occupation, and the choice not to take the offer of a waiver, defeated Mr. Bukenya's reasons for failure to pay rent for the period of lock - down. The two factors are a manifestation that the performance of the contract was not frustrated.

$[45]$ The present case is on all fours with the **National Carriers Ltd vs. Panalpina case (supra),** that I find provides a good guide.

Mashul mm 31/10

^&lt;sup>12</sup> See the letter written by M/s Knight Frank (U) Ltd dated October 17, 2020

In that case, the Appellants leased a warehouse from the Respondents for a term of ten (10) years from January 1974. In May 1979, the local Authority closed the street giving the only access to the warehouse because of the dangerous condition of a listed building opposite which could not be demolished without the consent of the Minister. At the time of the case, the closure that was thought to last for a shorter period, seemed likely to last just over eighteen (18) months, leaving the lease with three (3) more years to run. The closure prevented the Appellants from using the premises for the only purpose contemplated, that is as a warehouse. The Appellants stopped paying rent, claiming that the lease was frustrated.

Sheen, J. held that the doctrine of frustration could not apply to a lease. On appeal to the House of Lords, Lord Hailsham L C dismissed the appeal, with the conclusion, after reviewing several authorities, that the circumstances in which the doctrine of frustration can apply to leases, 'are exceedingly rare'.

[46] Resultantly, I cannot agree more with the submissions of learned Counsel, Mr. Lugayizi, that Mr. Bukenya's obligation to pay rent was unconditional in the circumstances of this case. I further agree with him that the termination notice issued on October 20, 2020 to the effect that Mr. Bukenya vacates the suit premises by January 31, 2021 complied with clause 6 (b) & (g) of the tenancy agreement, and was as such, lawful.

Macamel mm 31/10

- In respect of Mr. Bukenya's claim for compensation, although Mr. Bukenya (PW1) $[47]$ was able to adduce evidence that proved that he made several structural changes to the suit premises, including erecting a new structure, creating a new additional entrance, and modifying the perimeter wall, as correctly pointed out by Ms. Ojambo (DW1) two documents plainly defeated Mr. Bukenya's said claim. To wit; clause 4 (g) & (l) of the tenancy agreement and a letter written to Mcdon Kindergarten and Day care by M/s Knight Frank (U) Ltd dated October 31, 2016 (DEXH 2). - In that letter, Mr. Butt approved the structural changes on the suit premises, as [48] per a request by the school / Mr. Bukenya, but added that the school / Mr. Bukenya would solely meet the cost of the said changes.

Similarly, clauses 4 (g) & (l) of the tenancy agreement are to the effect that the tenant covenanted with the Landlord;

- Clause $4(q)$ 'Not to cut, maim, or injure any of the walls or timber of the suit premises or suffer or permit the same to be done, nor to drive any nails, screws, bolts or wedges in the floors, walls and or ceilings thereof without the previous written consent of the Landlord (which consent was not to be unreasonably withheld) SAVE for where such was required for the usual and or ordinary purposes such as photo hangers and the like; - Clause $4(l)$ 'Not to make any alterations in or additions to the suit premises without the previous consent of the landlord in writing. Such alterations including capital improvements to the premises will not be compensated by the Landlord unless such compensation is specifically agreed to in writing, in advance by the landlord'.

Maramel mm 31/10

By virtue of the above said documents, read together, Mr. Bukenya's claim for $[49]$ compensation for the structural changes made, cannot be sustained and consequently must collapse.

# Decision of this Court under issues No. 1 & No. 2:

By reason of the foregoing, I hold that the termination notice issued by the [50] Defendant to the Plaintiff was lawful. I also hold that there was breach of the tenancy agreement by the Plaintiff who defaulted in paying rent, and who refused to vacate the suit premises upon being served with the lawful termination notice.

Issues No. 1 & No. 2 are accordingly held in the affirmative.

#### Issue No. 3:

Whether the parties are entitled to the remedies sought in their respective pleadings?

Having found and held as I have under issues No. 1 & No. 2, it follows that the $[51]$ Plaintiff is not entitled to the claims in his suit. Judgment is entered for the Defendant / Counterclaimant in his counterclaim, in the following terms;

#### Orders of this Court:

- 1. The Plaintiff's suit against the Defendant fails and is dismissed with costs. - 2. The Counter-claim against the Plaintiff / Counter-Defendant succeeds MasamW um 31/10

#### a) Outstanding rent:

Mr. Bukenya shall immediately pay to Mr. Butt USD\$ 45,000 on account of outstanding rent for thirty (30) months; from May 2020 to October 2022 (both inclusive), at USD \$1,500 per month.

It is not in dispute that the last rental payment that Mr. Bukenya made was on March 1, 2020 of USD \$ 4,500 for the period; February 1, 2020 to April 30, 2020 as per the invoice (PEX 6) and the receipt (PEX 7) from M/s Knight Frank (U) Ltd.

In arriving at USD\$ 45,000, I have made reference to the monthly rent of USD \$ 1,500 charged under clause 3 of the tenancy agreement, and also to both the acknowledgement by Mr. Bukenya (DW1) that the outstanding rent he owed up to December 2021 was is USD \$ 30,000, and to the written submissions of learned Counsel; Mr. Lugayizi; who stated that for the period May 2020 to May 2022 (25 months), the rent outstanding stood at USD\$ 37,500.

I rejected the content of the rent statement marked DEXH 8. I found that statement to be inconsistent with the rest of the evidence on record.

I also rejected the Defendant's claim for any rent escalation. Much as clause 3 of the tenancy agreement provides for a 7% escalation, no evidence was adduced before this court that the rent was in fact escalated. The evidence Maginal mm 31/10 23

on record shows that at all material times, the Plaintiff was charged / invoiced USD\$ 1,500 per month, for rent.

**b)** General damages

The Defendant is hereby awarded general damages of USD \$ 7,500 (equivalent to five months' rent) against the Plaintiff for breach of contract. This figure is awarded on account of the Plaintiff's failure to pay rent for the thirty months' period stated, and the resultant inconvenience and deprivation occasioned to the Defendant of the use of this money.

### **c)** Vacant possession:

The tenant shall immediately vacate the suit premises and yield up the same to the Defendant in good and tenantable repair and condition.

- **d)** Interest: - Interest at the rate of 14% per annum is hereby awarded on the $i)$ principal outstanding rent of USD\$ 13,500 as at January 29, 2021 (for the period prior to the institution of this suit), calculated from the date of the institution of this suit, to the date of this Judgment. - Interest at the rate of 14% per annum is hereby awarded on the ii) principal outstanding rent of USD\$ 45,000 herein adjudged, Macamh um 31/10

calculated from the date of this judgment, till the date payment is made in full. (Sec. 26 (2) of the CPA applied)

- e) The proceedings and Ruling in Misc. Applic. No. 025 2021 in the Chief Magistrate's Court of Mengo are hereby set aside. - f) The costs of the Counter-claim are also awarded to the Defendant against the Plaintiff. (Sec. 27 of the CPA applied)

Masumel mm 31/10

I so Order,

## P. BASAZA - WASSWA **JUDGE**

October 31, 2022

Judgment delivered electronically on the Judiciary ECCMIS system and via email to the parties.