[2004] UGCommC 36

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{\mmathPr\mmathFont34\mbrkBin0\mbrkBinSub0\msmallFrac0\mdispDef1\mlMargin0\mrMargin0\mdefJc1\mwrapIndent1440\mintLim0\mnaryLim1}{\info{\title THE REPUBLIC OF UGANDA }{\author Administrator}{\operator skivumbi}{\creatim\yr2010\mo3\dy12\hr10\min47} {\revtim\yr2010\mo5\dy31\hr15\min41}{\version6}{\edmins50}{\nofpages18}{\nofwords6353}{\nofchars31640}{\nofcharsws37918}{\vern32859}}{\*\xmlnstbl {\xmlns1 http://schemas.microsoft.com/office/word/2003/wordml}} \paperw12240\paperh15840\margl1440\margr1440\margt1440\margb1440\gutter0\ltrsect \widowctrl\ftnbj\aenddoc\trackmoves1\trackformatting1\donotembedsysfont0\relyonvml0\donotembedlingdata1\grfdocevents0\validatexml0\showplaceholdtext0\ignoremixedcontent0\saveinvalidxml0\showxmlerrors0\noxlattoyen \expshrtn\noultrlspc\dntblnsbdb\nospaceforul\formshade\horzdoc\dgmargin\dghspace180\dgvspace180\dghorigin1440\dgvorigin1440\dghshow1\dgvshow1 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(}{\pntxta )}}\pard\plain \ltrpar\s15\qc \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid4799371 \rtlch\fcs1 \af0\afs24\alang1025 \ltrch\fcs0 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371 THE REPUBLIC OF UGANDA \par }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 IN THE HIGH COURT OF UGANDA AT }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371 KAMPALA \line (}{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371\charrsid4799371 COMMERCIAL DIVISION) \par CIVIL SUIT NO. 809 OF 1999 \par }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid4799371 JOSEPH RWAKATOOKE MUCHOPE }{\rtlch\fcs1 \af0 \ltrch\fcs0 \b\insrsid12195874\charrsid4799371 ::::::}{\rtlch\fcs1 \af0 \ltrch\fcs0 \b\insrsid4799371 :::::::::::::::::::::::::::::::::::}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \b\insrsid12195874\charrsid4799371 :::::: }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371\charrsid4799371 PLAINTIFF \line VERSUS }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371 \par }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid4799371 CALTEX OIL (U) LTD }{\rtlch\fcs1 \af0 \ltrch\fcs0 \b\insrsid12195874\charrsid4799371 :::::::}{\rtlch\fcs1 \af0 \ltrch\fcs0 \b\insrsid4799371 :::::::::::::::::::::: :::::::::::::::::::::::::::}{\rtlch\fcs1 \af0 \ltrch\fcs0 \b\insrsid12195874\charrsid4799371 ::::::::::}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371 DEFENDANT \par }\pard \ltrpar\s15\ql \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid4799371 {\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 BEFORE: }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\ul\insrsid12195874\charrsid12675007 THE HON. LADY JUSTICE M. S. }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\ul\insrsid12195874\charrsid4799371 ARACH }{\rtlch\fcs1 \af0 \ltrch\fcs0 \ul\insrsid12195874\charrsid4799371 \emdash }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\ul\insrsid4799371\charrsid4799371 AMOKO}{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\ul\insrsid4799371 \par JUDGME}{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\ul\insrsid12195874\charrsid12675007 NT}{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid4799371 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Plaintiff \emdash Mr. Muchope Joseph is a Kampala based businessman. The Defendant is an oil company, duly incorpora}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ted under the laws of Uganda. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The brief facts leading to this dispute are straight forward. The two parties executed a dealership agreement dated 1}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 st}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 January 1995, which granted the Plaintiff a licence to operate Katwe Caltex Petrol Station, in Kampala; under the name and style of}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 Regent Katwe Service Station. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 At the commencement of the operations, the Defendant gave the Plaintiff a loan in form of oil products worth Shs.25m. The loan was secured by a mortgage over the Plaintiff\rquote s property comprised in LRV 2085 Folio}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 2 Block 75 plot 38, Bunyangabu}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 , Rwimi, near Fort Portal. \line The Plaintiff took over and managed the said petrol station until January 1999, when the Defendant terminated the dealership agreement due to poor sales performance. By then the outstandi}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ng amount on the loan was Shs.10}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 ,219,087. When the Defendant sought to exercise its rights of sale under the mortgage agreement, the Plaintiff filed this suit instead, alleging breach of contract on the part of the Defendant an}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 d prayed for: \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 a. a declaration that his property }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371\charrsid12675007 aforementioned}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 is not lia}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ble for sale by the Defendant. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 b. a permanent injunction restraining the Defendant, its agents or servants from selling or dealing in the said land in any manner inconsistent with this own}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ership and occupation thereof. \par c. special damages. \par d. general damages. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 e. an order of set off f}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 or the sum of Shs.125,499,378. \par f. interest. \par g. costs. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 h. any other relief. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Defendant denied liability and counterclaimed the money owed to it by the Plaintiff under the dealership agreement plus utility bills totali}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 ng Shs. 12,325,540- and costs. \par \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The following facts were agreed}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 at the scheduling conference: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. That there was a dealership agreement between the Plaintiff and the Defendant dated }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 1st }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Januar}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 y 1995 signed by both parties. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. That the Defendant advanced fuel worth Shs.25m to the Plaintiff and the loan was secured by a mortgage }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid4799371 dated }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid4799371 2nd }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371\charrsid4799371 June 1998}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 . \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 3. That the Defendant terminated the contract by a letter }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid4799371 dated }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid4799371 25th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371\charrsid4799371 January \line 1999. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 4. That there is a balance owing to the Defendant of Shs. 10,217,087- a}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 t the time of filing the suit. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The followin}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 g were points of disagreement: }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. The Plaintiff does not agree that the agreement da}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ted July 1998 came into force. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. The Defendant does not agree that there were shortfalls in the fuel pumped into the station tanks as a result}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 of leakages in the tanks, and

\par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 3. The fact that the Def}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 endant is liable for the same. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 4. The Plaintiff do}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 es not admit the counterclaim. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 5. The Plaintiff challenges the validity of the termination. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The following }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 issues were framed and agreed: \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. Whether the relationship between the parties was governed by the agreement dated 1 January 1995 alone, or by the one }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid4799371 dated }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid4799371 28th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371\charrsid4799371 July, 1998 as well. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. Whether there was breach of the terms of the agreement in force at th}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 e relevant times, and by whom. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 3. Whether the tanks and other equipments at the station were defective at the material times complained of, and if any losses occurred, whether such losses were a result of leakage and loss through d}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 efects in the tanks equipment. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 4. Whether the Defendant is liable under }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371\charrsid12675007 occupier\rquote s}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 liability, or for any losses if }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 any suffered by the Plaintiff. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 5. Whether the Defendant lawfully terminate}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 d the dealership relationship. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 6. Whether the Plaintiff is liable to the Defendant i}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 n water bills and electricity. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 7. What are the reme}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 dies available to the parties? }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Plaintiff called three other witness}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 es, apart from himself namely: \par - Mr. Richard Mugisha PW2. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 - Mr. Micheal Saka Mukasa PW}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 3 and \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 - }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 Mr. David Mutyaba Segulla PW4. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Defendant called only one witn}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ess, Mr. Godfrey Kundakwe DW1. \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The issues are dealt with in the same order. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The first issue is regards the agreement governing the relationship between the two parties. On Court reco}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 rd are two sets of agreements: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. The Dealership agreement dated 1}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 st}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 January 1995 (Exh. P1) tendered by the Plaintiff, and referred to herein af}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid4799371 ter as the \'93old agreement\'94 and \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. The Dealership agreement dated 28th July 1998 (Exh. D7) tendered by the Defence side, referred to herei}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 nafter as the \'93new agreement\'94.

\par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Plaintiff\rquote s counsel contended that the old agreement of 25/1/95 is the only one which governed the relationship between the two part}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 ies for the following reasons: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Firstly, that the Plaintiff signed the new agreement of 28/7/98 (Exh. D7) on the basis that the Defendant would also sign it and return to him a duly executed copy. It could only become operational after the Defendant had signed it and notified the Plaintiff by sending him a copy of the executed document. The Defendant did not do so and th e Plaintiff only got to know about the execution of the said agreement by the Defendant after he had commenced these proceedings and }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 had pleaded the old agreement. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Secondly, throughout their dealings, the Defendant never referred to the new agreement. In f act the Defendant based its termination letter of 25/1/99 (Exh. P7) on clause 8 of the old agreement. In another letter dated 1/2/1999, the Defendant\rquote s Marketing Manager referred to the termination letter again. If the old agreement had become null and void, the said Marketing Manager would not have referred to it. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 It is pertinent to note that both letters were copied to the General Manager, Finance Manager, and Sales Executive, who must have found the contents}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 of the letter quite in order. \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid15159811 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Counsel for De fendant submitted on his part that the old agreement was replaced in July 1998 by the new agreement. The parties envisaged this even in the old agreement which re}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 ad in the last paragraph that: \par }\pard \ltrpar\s15\qj \li720\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0\ipgp1\pararsid15159811 {\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 \'93 This agreement will automatically become null and void and shall be replaced by the new Standard RPTF Service Station Operators agreement once the latter becomes ready.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Secondly, the new agreement was executed by}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 both parties and it bears the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Plaintiff\rquote s signature. The Plaintiff had ample opportunity to read it befo}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 re signing it. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 After that the relationship between the parties was}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 governed by new terms. In his }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 view, this point need}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 not be belabored any further. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 I have considered both submissions and reached this conclusion. The existence of the old agreement is an agreed fact. The only question is whether that agreement was subsequently replaced by the new one of 28/7/98. I think it was, for a number of re}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 asons including the following: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The last paragraph of the old agreement provided as quoted earlier on that it would automatically become null and void and would be replaced by the new standard RPTF service station }{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 operator\rquote s}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 agreement once the latter become ready. It is clear, therefore, that at the time of signing the old agreement, both parties were aware that they would sign a new standard RTF station }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 operator\rquote s}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 agreement as soon as it was ready and it would replace the old one. The new agreement therefore replaced the old one u}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 pon execution by both parties. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Secondly and most importantly, the new agreement bears the signature of the Plaintiff on all pages as well as the stamp of the Regent Katwe Station Ltd under which the station was run. That fact is enough to validate an agreement in the absence of any vitiating factors such as incapacity, duress, undue influ e nce, fraud or illegality, which is not the case in the instance dispute. The fact that the Plaintiff did not see it or that the Defendant never referred to it after execution is really in my view, immaterial. The Plaintiff must have had opportunity to rea d it before signing it and he should have, as a prudent businessman of his status requested for a copy of the executed document after signature. He told Court that he was the Marketing Manager of the Defendant up to 1994. He did not ask for the copy and in

my view, he cannot use that as a defence. The fact that the Defendant did not refer to it in their dealings is also not a defence. It does not vitiate it. Clearly the Marketing Manager referred to clause 8 of the old agreement in his termination letter of 25/1/99 is an error because the new agreement is very clear. Clause 2 reads:}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 \'93}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid12195874\charrsid15159811 COMMENCEMENT }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid15159811\charrsid15159811 DA}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid12195874\charrsid15159811 TE}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid15159811\charrsid15159811 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid12195874\charrsid15159811 AND PERIOD }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid15159811\charrsid15159811 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 This licence shall }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid15159811 commence on }{\rtlch\fcs1 \af0 \ltrch\fcs0 \i\insrsid12195874\charrsid15159811 2}{\rtlch\fcs1 \af0 \ltrch\fcs0 \i\insrsid15159811\charrsid15159811 8th}{\rtlch\fcs1 \af0 \ltrch\fcs0 \i\insrsid12195874\charrsid15159811 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid15159811 July 1998 and will be valid for five (5) years from the date hereof subject to termination as provided for under clause 14.\'94}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811

\par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The answer }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 to the }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 1st }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 issue is clearly}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 that the dealership between the parties was governed by the old agreement dated January 1995 from that date until }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 28th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 July 1998 when it was replaced by the new one dated }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 28th}{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 July, 1998. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The second iss ue is whether there was breach of the terms of the agreement in force at the relevant time and if so, by whom. Counsel for the Plaintiff contended that the Defendant breached the old agreement and referred to the particulars of breach set out in paragra}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 ph 9 of the plaint as follows: \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 a. failure to maintain }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 equipment in proper condition. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 b. failure to pressure test or to do any test of the equipment before inviting the P}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 laintiff to do business there. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 c. failure to take appropriate action whenever the Plaintiff reported short falls }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 in the output of the products. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 d. failure to replace faulty tanks and inviting the Plaintiff to the premises where the equi}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 pment was very old and faulty. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 e. termination of the Plaintiff\rquote s dealership on grounds of limited purchases when the Defendant had not replaced the faulty tanks. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811

\par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 f. dismissing the Plaintiff from the service station without regard to the Defen}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 dant\rquote s own defaults/omissions. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 g. advertising the Plaintiff\rquote s land for sale while the Defendant was the one in }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 breach/at fault. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 h. generally causing fi}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 nancial loss to the Defendant. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 i. generally failing to observe the term}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 s of the dealership agreement. \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The law is trite. He who alleges must prove. See: }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 Sebuliba \emdash Vs- Coop }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Bank [1982] HCB 129 and }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 Nsubuga \emdash Vs- Kavuma }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 [197 8] HCB 307. The question therefore is, whether the Plaintiff has proved these particularised alleged breaches to enable the Court to make a finding of breach of contract}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 on the part of the Defendant. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Learned counsel for the Plaintiff submitted that the ev idence of PW1 and PW3 was sufficient to prove that the Plaintiff lost fuel through leakages of tanks at the said petrol station. That PW3 had shown both by his report and his oral testimony that the tanks at the said station had holes in them when they we re }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 excavated}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 . The two witnesses had also proved that the tanks recorded short falls throughout the material times. That this evidence was not controverted and in the absence of any other explanation for the short falls, it must be concluded that the holes i n the tanks let out the fuel. Counsel then invited the Court to take }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 judicial}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 notice of the fact that a container with holes will let out the liquid substance in it.}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Counsel for the Plaintiff further maintained that the conditions of the new agreement did not apply to the Plaintiff, for reasons stated earlier on. That even if it were assumed that the new agreement was applicable to the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 parties\rquote }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 dealings, the Plaintiff\rquote s evidence clearly shows that he always called upon the Defendant to come and rectify suspected defects in the equipments. The Defendant\rquote s agents always went and either insisted that there were no defects or that the defects had been rectified. The Plaintiff was not in a position to know the specific defects and as such, he was entitled to rely on the Defendant\rquote s technical personnel \rquote s advice. In this case, there was no need for written communication since the Defendant\rquote s technicians usually claimed to}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 have rectified the situation. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 On the issue of written notices of losses (leakages), counsel su bmitted that the only time he came to establish that the final losses were due to leakage was after 24/12/98. His letter of claim was therefore well }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 within the 14 days limitation. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Counsel for the Plaintiff also submitted that the Defendant was in breach of contract in terminating the agreement for the Plaintiff\rquote s failure to meet sales targets; because the failure was due to the Defendant\rquote s failure to provide sound equipment. The Plaintiff was therefore entitled to refuse to dump more of his fuel products i n tanks which had by then been established to be leaking. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Finally, counsel submitted that the advertisement of the Plaintiff\rquote s land was wrongful in that the debt was supposed to be paid up }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 in 12 months from 2/6/98 (See: }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Mortgage Deed \emdash Exh. D5). Demand for full payment was made even before January, 1999, and was followed by the demand from the Defendant\rquote s advocates dated 13/5/99. This was before the 2/6/99. The demand was therefore wrongful and could not form the basis for the realization of the mortgage under the mortgage decree, 1975. He invited the Court to revist the arguments on this po}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 int in Misc. Appl. No. 911/99. \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Counsel for the Defendant had the opposite view on} {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 this issue. He summarized the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Plaintiff\rquote s allegations into three groups}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 that: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. The Plaintiff alleges that the Defendant invited him to the premises when there was old and faulty equipment, failed to maintain the equipment or take action whenever he reported shortages and that he ther}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 efore suffered financial loss. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. That the Defendant w as in breach of the dealership agreement by terminating it on the basis of limited purchase and dismissing the Plaintiff from the station without regard to the Defendant\rquote s all}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 eged own faults and omissions. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 3. That the Defendant was in breach of the contract by putting up the Plaintiff\rquote s land for sale and generally causing financial loss to the Plaintiff and generally failing to observe the dealership agreement. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Regarding the first set of allegations, counsel for the Defendant submitted that no evidence ha d been led at all to show that the equipment at the station was old and faulty from the outset. That such a charge lies in the month of the Plaintiff who was a former top executive of the Defendant }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 Company}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 . He was in a position to ensure that the equipment he took over from the Defendant was in good workable condition at the time of entering into the station. That the Plaintiff also admitted in cross- examination to being fully familiar with the terms of the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 dealer\rquote s}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 agreement so he would have known the ris ks he was taking on. The Plaintiff must have been fully satisfied with the equipment at the time of taking over the station from the Defendant. The rights and duties of both parties were spelt out in the two dealership agreements in the event of faulty eq u ipment. (See Exhibit P1 clause 6 (b) ii) which illustrates that the Plaintiff was under a duty to keep Caltex informed of any faults occurring on the site or any need for repairs. This was only logical because it was the Plaintiff on the ground who could detect these faults. The Defendant\rquote s duty, in turn, was to carry out the necessary repairs. Although the Plaintiff has brought this suit claiming that he experienced shortages }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811\charrsid12675007 throughout}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 the years 1996-99, there are only two letters on the record showing that he actually ever reported any faults to the Defendants namely Exh}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 . P3 dated 14/12/98 and Exh. Pl0}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 dated 7/9/96. The claim that he made several report}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 s are accordingly exaggerated. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Be that as it may, the Plaintiff admitted under cross examination that e ach time he made a report Caltex would respond by sending its officials to carry out repair work and they would only tell him to continue after carrying out repairs. He did not testify that Caltex failed to respond to a single report. Caltex therefore dis charged its obligations fully in this regard, every time he made a repor}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 t and they responded promptly. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Secondly, clause 6 (b) (ii) shows that the Plaintiff was under a duty not to use the faulty equipment until repairs had been carried out. This was acknow ledged by the Plaintiff. It follows that if he had adhered to the agreement, he could not possibly have suffered loss as result of leakage and shortages because he was only entitled to use the equipment while it was working properly. Any loss that he may have incurred because of persistent use of faulty equipment must fall squarely at the doorstep of the Plaintiff because he acted in violation of the contract provisions. He also must be said to have acted negligently and visited the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 loss upon himself. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Exhi bit D7, that is the new agreement which governed the question of leakages and shortages after July 1998 (when Exhibit P.3 was written) there is a detailed process set out, under clause 6 thereof, as to the manner in which losses were to be reported in ord e r to make the Defendant liable for them. The salient features were that the Plaintiff had to make an immediate telephone report and follow it up within 14 days with a written report, accompanied by detailed calculation of losses. The Plaintiff was not ent itled to continue using equipment that has, as the dealer, considered defective without the express written consent of the Defendant. If he did so, he was solely liable for the loss incurred by failure to observe the contract. The Defendant was abs}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 olved from all such liability. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Finally, it was also provided that in any event the Defendant would not be liable for losses accruing more than 14 days prior to written notice. Even a casual reading of Exhibit P3 shows that the Plaintiff did not fulfill the contrac tual conditions precedent for making the Defendant liable for the al}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 leged losses suffered in 1998. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 In the first place, the letter makes no reference to any telephone report made in accordance with the agreement. Secondly, the letter refers to incidences o n the dates of 28th October and 16th November both of which are far more than the contractual 14 days notification period prior to 14th December 1998, }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 the day of the written notice. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Thirdly, counsel submitted, the report makes no computation of losses as required by the contract. Fourthly, the letter illustrates deliberate continued use by the Plaintiff of defective equipment thereby absolving the Defendant of any possible liability for even the losses that allegedly occurred on }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 November }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 30th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 1998, because by that time the Plaintiff had already good reason to suspect the tanks more defective. He should not have therefore continued using the tanks after the incidences of }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 28th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 October and l6\rquote November. That is what the contract stipulated. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 The Plaintiff also relies heavily on a report dated }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 4th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid15159811 January, 1999, prepared by Mutyaba Petroleum Pump Service, indicating that upon pressure testing it}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 was found that some tanks specifically 1K (Kerosene) and AGO (Diesel) had leaks. (Exhibit P15). According to counsel f or the Defendant, all that the report established was that, as at the day of testing, there were some holes in the tanks. That Mr. Mutyaba failed to tell when the holes first appeared during cross-examination. There is also nothing in the report to establ ish that the holes had been there for any particular period of time. The report is therefor}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 e most unhelpful to the Court. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 According to Mr. Byenkya, the report actually shows the faithful manner in which the Defendant discharged its obligations. Upon being asked to conduct a pressure test, it immediately obliged. When the tanks failed to test, the Defendant immediately offered to replace them. (See: Exhibit P5). In light of the above, counsel asked the Court to find that the Defendant had discharged all its

contractual obligations by responding to reports by the Plaintiff of faults and by carrying out necessary repairs. The fact that during a three year operation, the Plaintiff only wrote twice to complain shows that the problem was not a continuous one, he would the Court to believe. At any rate, the Defendant faithfully, discharged its duties up to the end and even when some tanks were found to be defective it even agree}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 d to replace them immediately. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Mr. Byenkya further submitted that with regard to the set of allegations that the Defendant breached the agreement by terminating the same, counsel for the Defendant submitted that the allegation is clearly unsustainable. It is not disputed that the Defendant had a right of termination under the terms of both d ealership agreements. Termination for failure to meet sales targets was one of the grounds on which the Defendant could terminate the contract within its term. It cannot therefore be said that by exercising a contractual right, the Defendant }{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 was in breach of the contract. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Finally, on the allegation of breach of the dealership agreement by offering the Plaintiff\rquote s land for sale, Mr. Byenkya submitted that the allegation was also untenable. That the Plaintiff admits owing}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 the Defendant Shs.l0}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 m. He also admits having executed a mortgage agreement to secure the loan (See: Exhibit D5). The mortgage was secured by the Plaintiff\rquote s property that was up for sale. There is an express power of sale under the mortgage without reference to the Court. The parties had two distinct and separate agreements. Neither of them was dependant on the other. The Plaintiff\rquote s property was put up for sale under the terms of the mortgage agreement, which governed the loan to the Plaintiff. It cannot be said to be a breach of the dealersh ip agreement, which regulated the business relationship of the Plaintiff and the Defendant. The second issue should thus be resolved in favour of the Defendant.}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 I have held in the first issue that the relationship between the two parties was governed by the first agreement dated 1/1/95 up to the 28/7/98 when it was replaced by the new agreem}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 ent. Clause 6 (b) (iii) reads: \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 \'93}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 6. During the continuance of the }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 licenc}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811\charrsid12675007 e}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 , the operator shall: \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (b). Keep the service station }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 clean and tidy and \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (iii) }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid15159811\charrsid12675007 Notify}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid12195874\charrsid12675007 Caltex immediately }{ \rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 of a}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 ny repair or adjustment necessar}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 y or desirable to any of the equipment referred to in paragraph (ii) of this sub }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 \emdash }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 cl}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 ause and }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid12195874\charrsid12675007 mean while not use the same.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid15159811 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 It is clear that the obligation of Caltex was to repair or make necessary adjustment t o the equipment. The obligation of the Plaintiff was not only to notify the Defendant immediately of the need for repair and adjournment, but most importantly, the Plaintiff was not to use the same. During examination in chief, PW2 said \'93 They told us that we should always tell them to come when there is such a problem. That we should not touch the tank if there is a problem.\'94 \line The testimony of the Plaintiff is clear. They signed the first dealership agreement on January 1995. He stated dur}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid15159811 ing examination in chief thus: \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 \'93I was experiencing fuel losses on a daily basis. The problem began late 1995 but became worse in 1996. }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid5468969\charrsid12675007 Our}{ \rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 appeals fell on deaf ears. }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid5468969 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 I started communicating in July }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 \emdash }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 Sept. 1995 after they had carried out the repairs. I wrote to the Manager about the problem, and the Sales Area representative was sent to discuss the matter with us. He said the matter was not a serious one.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid5468969 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 PW2 the station manager also informed Court that he used to take daily stock records. He noticed serious stock shortf alls and notified the Defendant. Repairs were carried out by the Defendants engineer but the shortfalls continued. PW4 told Court that in 1998, when he pressure tested the 3 tanks, they all failed the test. He made a report (Exh. P5) and later on Caltex i nstructed him to }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272\charrsid12675007 excavate}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 them. He did so and replaced them with two new ones. During cross examination, he stated that the tanks had holes. That is why they failed the pressure test. \line Apparently the Plaintiff continued using the equipment despite this dail y loss he complained about. Although the Defendant breached the said agreement by failing to repair and maintain the equipment, it is also clear that the Plaintiff continued to use the said equipment even after the Defendant had failed to repair the same. There is also evidence on record (Exhibit D8 dated 11/9/98) to the effect that the case of the poor performance was undercapitalisation as well. The evidence on record therefore shows that both parties breached the first agreement. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid5468969 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Regarding the new agree ment, no such provision existed. The Plaintiff however continued to experience losses and complained to the Defendant even after 1998. The Defendant kept on repairing the equipment but it is apparent that the repair was not effective. Mr. Mutyaba PW3, the i r technician who carried out pressure test on three underground tanks in January 1999 established that the tanks were defective and were leaking and recommended by his letter dated 4/1/99 (Exhibit P15) that the three tanks be uprooted and either repaired a nd treated or replaced. It is still unclear why the Plaintiff continued using the said tanks until January 1999 when the dealership agreement was terminated. The Defendant of course kept on maintaining that the underground tanks problem notwithstanding, t he stations problems were due to under}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid5468969 }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 capitalisation and insisted on their money. (See: Ex}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid5468969 hibit P5) which reads in part: \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 \'93Subject: }{\rtlch\fcs1 \ab\ai\af0 \ltrch\fcs0 \b\i\insrsid12195874\charrsid12675007 Defective tanks at Regent Service Station Katwe. }{\rtlch\fcs1 \ab\ai\af0 \ltrch\fcs0 \b\i\insrsid2630923 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 This is in reply to your letter dated 4/1/99, on the above subject. Caltex is in the process of replacing all tanks }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 that failed the pressure test. \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 Notwithstanding the underground tanks problem, the cause of the stations poor performance is due to undercapitailsation. Other causes of the stations poor performance were dearly out lined in our letter dated September 1998. }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 As the company rep/aces the tanks, it is advisable that you come forward with adequate funding an}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 d concrete proposals to re-utili}{ \rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 se the station.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The new agreement obliged the Dealer under clause 7 to meet the required sales performance and targets set yearly by th}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 e Defendant; and under (g) to: \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 Notify Cal}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 tex promptly of any loss, damage to or defect in premises or station }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923\charrsid12675007 equipment}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 defect.\'94}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Under clause 13, the Defendant had a right to terminate the agreement forthwith should \emdash \line }{\rtlch\fcs1 \ab\ai\af0 \ltrch\fcs0 \b\i\insrsid2630923 \lquote (}{\rtlch\fcs1 \ab\ai\af0 \ltrch\fcs0 \b\i\insrsid12195874\charrsid12675007 i) }{ \rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 the Dealer commits any breach of any of the }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923\charrsid12675007 provisions}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 of the Agreement.... }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }{\rtlch\fcs1 \ab\ai\af0 \ltrch\fcs0 \b\i\insrsid12195874\charrsid12675007 (ii) }{\rtlch\fcs1 \ab\ai\af0 \ltrch\fcs0 \b\i\insrsid2630923 \'85\'85\'85\'85\'85 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (iii) the Dealer fails or is unable to pay Caltex any amounts which have become due and payable by the Dealer to }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923\charrsid12675007 Caltex}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 either in respect of go}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 ods supplied or otherwise \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (iv) }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \'85\'85\'85\'85. \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (v) }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \'85\'85\'85\'85\'85.. \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (vi) }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \'85\'85\'85\'85. \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (vii) the Dealer falls to achieve the sales performance and targ}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 ets set up with Caltex and no val}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 id grounds exists}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 for the failure as per clause }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 8 C.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The letters on record namely exhibits D2 dated 25/1/99 are clear about poor sales }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 performance. It reads in part: \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \'93Subject: Poor Sales Per}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 formance }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 \emdash }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 Termination of Dealership. \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 Reference is made to various correspondences and discussions held regarding the poor sales performance of Regent Katwe Servic e Station, and in particular our letter dated 18/9/98 here att}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 ached for your easy reference. \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 For the whole year of 1998, you operate}{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 d below your target of 62,500 litres. Average sales for }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 1998 were 38,000 litres. This trend therefore cannot be permitted to continue in 1999.\'94 \line }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Under clause 6 the Defendant was not to be responsible for any loss of fuel unless the loss is due to the negligence on its part; and the dealer has inter alia, reported the loss immediately by telephone, followed by written notificat ion within 14 days and supported by calculations in support of the amount of the claim. The Plaintiff relies on the letter dated 14/1/99 (Exhibit P6) to support its claim that the loss was reported within 14 days. With due respect, this letter does not me et }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 requirements of clause 6 (iv) because it is not supported by any calculations in support of the claim as required. En the last pa}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 ragraph, the Plaintiff stated: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 \'93I am in the process of working out possible financial losses incurred due to this tanks problem which I am intending to come and discuss with management t}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 o reach an amicable solution.\'94 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Exhibit P3 (dated 14/12/98) cannot also be said to have been written in compliance with clause 6. The incidences complained of are outside the 14 days period and it makes no reference to any pr}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 evious telephone conversation. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Regarding the sale of the Plaintiff\rquote s land, I respectfully agree with counsel for the Defendant that the said mortgage was a separate and distinct contract and the Defendant cannot be stopped from exercising its rights }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923\charrsid12675007 there under}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 because of any problem arising out of the dealership agreement. The Plaintiff admits that h}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 e owes the Defendant over Shs.l0}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 m out of the loan secured by the said land by a mortgage deed. He has failed to pay and in my view, the Defendant was perfectly in order when it attempted to realise the said security. The attempt was however premature as Mr. Mugisha pointed out. The loan was to be paid within 12 months w.e.f 2/6/98 when the mortgage Deed was executed \emdash clause 2 of the mortgage deed provided that: }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 \'93The Borrower hereby agrees with the lender to pay to the Lender within 12 (twelve) months effective from execution hereof all money expenses.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The demand by the Defendants lawyers dated 13/5/99 was therefore pre \emdash mature. \line In conclusion on this issue, I hold that the Defendant breached the dealership agreement by failing to maintain and repair its equipment during the period of the dealership. The Plaintiff also breached the same by continuing to use the defective and leaking equipment even after establishing that the same was defective and that the Defendant had failed to repair it. Both par}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 ties are accordingly at fault. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The third issue is whether the Defendant is liable in }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272\charrsid12675007 occupier\rquote s}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 liability. The Defendants counse l reiterated his submissions under issue 2 and contended that the relationship between the two parties was regulated by contract. Their respective rights and obligations were set out under the contract. The question of occupier\rquote s liability, which is a tort, doesn\rquote t really arise. The two cannot be mixed together. He relied on the case of }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 Green \emdash Vs- Fibre Glass Ltd }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1958 2 ALL ER 521 where SALMON J. made a distinction between the two branches of law. In the alternative, counsel submitted that the evidence actu ally shows that the Defendant took all reasonable care by responding whenever the Plaintiff reported that he had problems and by doing its best to solve them. The Plaintiff has not suggested that the people sent to carry out repairs were not qualified or able to do the work. On the facts no negligence has been established against the Defendant. On the contrary any negligence is likely to have been on the part of the Plaintiff for persis}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 tent use of suspect equipment. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Counsel for the Plaintiff insisted that }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923\charrsid12675007 occupier\rquote s}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 liability and liability under contract can co-exist on the same facts just as in the instant case. The case of Green cited by counsel for the Defendant is not applicable here. In that case the dangerous condition of the premises was not due to t he occupier\rquote s negligence but that of the independent contractor who had carried out cable installation in the premises. Usually invitees have contractual or other relationship of mutual benefit between them and the occupier that takes them to the premises just as was the case in the instant case. The Defendant in this case had a duty to take reasonable care to ensure that the Plaintiff did not suffer damage or loss due to the condition of the premises including eq}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 uipment thereon. He relied on: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. Winfield & Jolowicz }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid2630923 on Tort }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid2630923 10th }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid2630923 Edn. (Sweet & Maxwell) 1}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 975 at 166, 167, }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923\charrsid2630923 168 and 186. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. Bakabonaki \emdash Vs- Bunyoro District}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 Administration (1970) EA 310. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 With all due respect, I agree with Mr. Byenkya, that this relationship between the parties is purely contractu al and is governed by the dealership agreement. If the Plaintiff suffered any loss, then such loss would have to be addressed according to the obligations of the parties under the contract. This issue is there}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 fore answered in the negative. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The fourth issu e is whether or not the tanks and other equipment at the petrol station were defective and whether such losses were a result of leakage through the defective tanks and equipment. The answer to the first part of this issue is affirmative. The testimony of the Plaintiff and PW3 are spot on. There were losses which were established due to leakages. The leakages were the result of defective tanks. Exhibit P15 is particularly noteworthy. It is a report made by PW3 after pressure tasting 3 }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923\charrsid12675007 underground}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 tanks. He confirmed leakage in all the three and concluded thus:}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 That was on 4/1/99. This fact was acknowledged by the Defendant for example in a letter dated 11/}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 1/99 (Exh. P5) stated in part: \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 \'93This is in reply to your letter dated 4/1/99 on the above subject. Caltex is in the process of replacing all the tanks that failed the pressure test.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid2630923 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 According to PW4, he indeed replaced two of the tanks on the Defendants instructions. The Defendant could not replace tanks that were not defective. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The second part of the issue is obvious. If the tanks are defective and leaking, then the leakage}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 would result in loss of fuel. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The answer to this issue is accordingly in}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid2630923 the affirmative. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Issue No. 5 is whether the Defendant lawfully terminated the dealership relationship or not. It is not disputed that the Defendant terminated the dealership agreement. It is also on record that the agreement (both new and old) provided for a right of termination. (See: clause 8 of the old and clause 13 of the new agreement). I have ruled earlier

that the new agreement replaced the old one at the time of termination. I have quoted earlier on the provision under clause 13 (vii) which stipulated that the Defendant had a right to terminate the dealership of the Plaintiff if he failed to meet the sale s performance targets set up by the Defendant. This was the reason given in the termination letter (Exhibit P7). Earlier on he had been given various warnings for poor sales performance e.g. Exhibit P.2 dated 18/9/98 and Exhibit D8 dated 11/9/98. I therefo r e agree with Defence counsel that the Defendant was well within its contractual rights because the Plaintiff failed to meet the sales target. There is no letter on record or oral testimony that the Plaintiff meet the target. The answer to this issue is ac cord}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 ingly affirmative. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The sixth issue concerns water and electricity bills. Clause 7 (m) of the new agreement is clear. It says: }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid6978272 \lquote The Dealer will: \par }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 (M) Be liable for all direct operating expenses incurred by the Dealer in connection with the PREMISES, in cluding but not limited to all deposits, charges for telephone (including telephone rentals), }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\ul\insrsid12195874\charrsid12675007 water, sewerage, electricity, }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid12195874\charrsid12675007 ages any other services or utilities.\'94 }{\rtlch\fcs1 \ai\af0 \ltrch\fcs0 \i\insrsid6978272 \par }\pard \ltrpar\s15\qj \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid12675007 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Plaintiff was responsible for water and elec}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 tricity and not the Defendant. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The last iss ue is remedies available to the parties. Starting with the Plaintiff. Having found that the Defendant was partly to blame for, the losses incurred by the Plaintiff due to its failure to repair and maintain the equipment, it follows that the Plaintiff is e n titled to some compensation as a result thereof. Liability for such loss was however pegged to 14 days written notice which is lacking in this case. Then an attempt at computation was made, but this was much later on after 14 days required. The Plaintiff c laims Shs. 125,499,378- for the period January 1995 to 1999; that is 4 years and the value of products found at the station of Shs.380,508-. It is trite law that special damages must not only be pleaded but must be strictly proved. The evidence on record does not prove these two claims. Th}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 ey are accordingly disallowed. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 I have ruled that the mortgage was distinct and separate from the dealership agreement \emdash the prayers under (a) and (b) are for that reason disallowed. The Defendant is free to realize its security in accordance with the Mortgage Deed after the expiry of the 12 months period given to the Plaintiff to pay the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 loan, which has since expired. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 There is evidence that the Plaintiff made several}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 complaints and reports to the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Defendant about the problems at the station. Tha}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 t although the complaints were }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 addressed, they persiste}{ \rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 d and the Plaintiff did not settle down in his business. The }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Plaintiff is therefore entitled to general damages fo}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 r this and I award him Shs.5m. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 Regarding the counter claim, the Plaintiff admitted that there is an outstandi}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 ng balance on the loan of Shs.10}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 ,219,087-. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 I award this to the Defendant. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Defendant also claimed Shs.2,106,453- as water and electricity bills. No evidence was however adduced by the Defendant to prove thi s claim. Besides it was the obligation of the Plaintiff to pay this amount to UEB (them) and not that of the Defendant. The Defendant can only recover this money upon proof of payment of the amount to UEB. There was no such proof. This claim is therefore disallowed. }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 The Defendant also prayed for general damages}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 for breach of contract of Shs. 5}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 m. I have ruled that the Plaintiff also breached the contract by continued use of the defective tanks. However, no evidence was }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272\charrsid12675007 left}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 to prove any inconvenience or loss suffered by the Defendant as a result of this. If anything, all the evidence points to}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 the loss and inconvenienc}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 e on the side of the Plaintiff. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 This}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 item is therefore disallowed. \par }\pard \ltrpar\s15\qj \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 In the result I ent}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 er Judgment for the Plaintiff: \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 1. For the }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 sum of Shs.5m general damages. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. Interest thereon at 8% p.a from date of }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 Judgment till payment in full. \par 3. Costs of the suit. \par \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 I also enter }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272\charrsid12675007 Judgment}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 on the counte}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 r claim for the Defendant for: \par 1. Shs. 10,219,087-. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 2. Interest thereon at 18% p.a from date o}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 f filing till payment in full. \par 3. Costs of the counter claim. \par \par }\pard \ltrpar\s15\ql \li0\ri0\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 M. S. Arach \emdash Amoko \line }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \b\insrsid12195874\charrsid12675007 JUDGE \line }{\rtlch\fcs1 \ab\af0 \ltrch\fcs0 \insrsid12195874\charrsid9313432 21/10/2004 }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272\charrsid9313432 \par }\pard \ltrpar\s15\ql \li0\ri0\sb100\sa240\sbauto1\sl360\slmult1\widctlpar\wrapdefault\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\ipgp1\pararsid6978272 {\rtlch\fcs1 \af0 \ltrch\fcs0 \ul\insrsid12195874\charrsid12675007 Judgment delivered in the presence of: }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 \line 1. Bogere Geoffrey holding brief for Mr. Ndozireho & Mr. Mugisha for the Plaintiff. \line 2. Ms Florence Kavuma holding bri ef for Mr. Byenkya for Defendant}{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid6978272 . \line 3, Mr. Okuni \emdash Court clerk. \par }{\rtlch\fcs1 \af0 \ltrch\fcs0 \insrsid12195874\charrsid12675007 M. S. 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