[2023] UGCommC 278

**THE REPUBLIC OF UGANDA**

**IN THE HIGH COURT OF UGANDA AT KAMPALA (COMMERCIAL DIVISION)**

**CIVIL SUIT NO. 714 OF 2017**

**ERIEZA KAGGWA :::::::::::::::::::::::::::::::::::::::::::::::::::::: PLAINTIFF**

VERSUS

**EPHRAIM NTAGANDA ::::::::::::::::::::::::::::::::::::::::::::: DEFENDANT**

**Before: Hon. Lady Justice Cornelia Kakooza Sabiiti**

**JUDGMENT**

**Introduction**

1. The Plaintiff brought this suit against the Defendants for recovery of an alleged sum of UGX 914,000,000/=, being the balance of the purchase price and interest thereof arising from a land sale agreement executed by the Defendant and Plaintiff on 14th June 2012, interest thereon and costs of the suit. 2. The Plaintiff’s case is that under an agreement dated 14th June 2012 duly executed by the parties, the Plaintiff sold various plots of land to the Defendant. Under Clause 1, of the said agreement the agreed purchase price is UGX 7,100,000,000. Under Clause 2, the Defendant was directed to make certain direct payments from the purchase price on the Plaintiff’s behalf and the Defendant paid out UGX 6,186,000,000 as directed. However, the Defendant did not pay the balance of UGX 914,000,000/= to the Plaintiff despite a written demand to him on 1st July 2012 hence this suit. 3. The Defendant in his written statement of defence, denied the Plaintiff’s claims and averred that whereas the impugned agreement of 14th June 2012, was executed by both parties. Clause I of that agreement had an error which indicated the purchase price as UGX. 7,100,000,000/= instead of the correct agreed sum of UGX 6,186,000,000/=. That upon realization of the error in the purchase price which was on the same day, the parties admitted the error, agreed and executed another agreement on I5th June 2012 which indicated the correct purchase price and stated that it superseded all prior agreements, including that of 14th June 2012 which had an error. That the Defendant’s contention that the claim of UGX 914,000,000 being the alleged outstanding balance owed to the Plaintiff is premised on lies. 4. In reply to the written statement of defence of the Defendant, the Plaintiff averred that the there was no inadvertent miscalculation, or computation of the consideration that was UGX 7,100,000 under the agreement dated 14th June 2012. That the Plaintiff has never signed a separate agreement setting any new terms. That the agreement of 15th June 2012 is a forgery with forged signatures of the Plaintiff and his wife has been fraudulently procured by the Defendant to avoid paying the balance of UGX 914,000,000. That the sum of UGX 6,186,000,000 is only the total of the debts to be paid off and not the purchase price.

**Issues:**

1. The following were the issues as agreed under the joint scheduling memorandum: 2. Whether the consideration under the agreement was UGX 6,186,000,000 or UGX 7,100,000,000 and if there was an excess of UGX 914,000,000 3. Whether the Defendant is indebted to the Plaintiff to the tune of UGX 914,000,000? 4. What are the remedies to the parties?

**Witnesses**

1. Hearing was by witness statements in lieu of examination in chief and the witnesses were subjected to cross examination. The Plaintiff led evidence through three witness: PW1, Erieza Kaggwa, the Plaintiff; PW2, Nalongo Allen Kitengo Kaggwa, the Plaintiff’s wife; and PW3, Babirye Miriam Kaggwa, the Plaintiff’s daughter. The Defendants led three witnesses DW1, Chelangat Sylvia, a Police Officer from Forensics Examination; DW2 Patrick Mugwanya; and DW3 Ephraim Ntaganda, the Defendant.

**Representation**

1. The Plaintiff was represented by M/s Waymo Advocates. The Defendant was represented by M/s Magna Advocates.

**RESOLUTION**

1. The Plaintiff bears the burden to prove to the satisfaction of Court the averments in the Plaint as provided for under section 101 of the Evidence Act. This burden is on a balance of probabilities. Since the first two issues are inter-related they will be resolved together.

**Issues No. 1 & 2: *Whether the consideration under the agreement was UGX 6,186,000,000 or UGX 7,100,000,000 and if there was an excess of UGX 914,000,000 whether the Defendant is indebted in this amount to the Plaintiff***

1. A contract is defined under ***Section 10 of the Contracts Act 2010*** as an agreement made with the free consent of parties with capacity to contract, for a lawful consideration and with a lawful object, with the intention to be legally bound. 2. In the instant case it is not disputed by the parties that on 14th June 2012 they entered into an agreement (PEX.1) where the Plaintiff sold various plots of land under Block 443 Kogero-Busiro estimated at 9.7 acres to the Defendant. Under clause 1 of this agreement it is stated as follows;

*“1. That the VENDOR is desirous to sell off all the property comprised in Certificates of Titles aforementioned AND that the PURCHASER agrees to buy and/or purchase all the said property at a Purchase Price or Consideration of UG SHS. 7,100,000,000.*

1. Clauses 2, 3 and 4 of this agreement further provided for several payments be made from the Purchase price/Consideration for the outstanding obligations due to the vendor. 2. The testimony of the Plaintiff/PW1 is that the agreement of 14th June 2012 was the only agreement signed by the parties. PW1 stated that the agreement of 14th June 2012 did not specifically state that there was a balance of UGX 914,000,000 to be paid to him. PW2, the Plaintiff’s wife corroborated his evidence and denied signing the second agreement of 15th June 2012. PW3 the daughter of the Plaintiff testified that she read and translated the terms of the agreement of 14th June 2012 to her mother and that PW1 never informed her of any error in the agreement of 14th June 2012 or that a subsequent agreement to correct the error was signed on 15th June 2012. 3. The Defendant/DW3 testified that he realized the error of UGX 7,100,000.000/= in the agreement of 14th June 2012 while he was filing it. That the error was in respect of only Clause I which he believed was a typing error on the consideration where instead of UGX 6,186,000,000/=,it was typed as UGX 7,100,000,000. DW3 testified that it is the person who drafted the agreement that made a mistake/inadvertent error. DW3 testified that the agreement of 15th June 2012 corrected that of 14th June 2012 on only clause I of the agreement and that it amended the previous agreement and stated in paragraph 6, that it superseded all earlier agreements including that of 14th June 2012. 4. DW2 corroborated the testimony of DW3 that another agreement was signed on 15th June 2012 to correct the error on the consideration under clause 1. That he attended the meeting with the Plaintiff at the same law firm the first agreement had been drafted and witnessed the agreement. 5. DW1**,** Chelangat Sylvia, the Forensic Document Examiner, adduced a Laboratory report dated 14lh November 2018, and her findings after comparison with other documents were that the Plaintiff was most likely to be the author of the signature on the agreement of 15th June 2012 made by the Plaintiff. Counsel for the Plaintiff submitted that Clauses 1 & 2 are written in plain and clear words and while clause 1 defines the agreed purchase price, clause 2 directed the Defendant/DW3 to make specific payments directly from the agreed priceon the Plaintiff/PW1’s behalf. He submitted that under Section 92 of the Evidence Act, the Defendant having signed the agreement is bound by it as held in the case of ***Golf View Inn (U) Ltd vs Barclays Bank HCCS No. 358 of 2009***,that once parties have executed a written agreement**,** they are hound by it and it is wholly immaterial whether they read or were aware of its contents. The import of Section 92 of the Evidence Actwas stated in ***Hima Cement Ltd vs Cairo International Bank*** ***HCCS No. 13 of 2002*** that ‘*parties having made a complete memorial of their agreement must he presumed to have put into writing all they consider necessary to give full expression to their meaning and intention****,*** *and secondly because the reception of oral testimony would create mischief and open the door to fraud*.’ 6. Counsel for the Defendant submitted that the Parole evidence rule under section 92 of the Evidence Act is to the effect that once an agreement is reduced into writing and executed by the parties, the parties are bound and it is wholly immaterial whether the parties read the document or were not aware of the contents of the same and that the exceptions to the rule which would include fraud and misrepresentation. He further submitted that clause I of the agreement had to be read together with clause 2 and that the sums in clauses 2, 3 & 4 formed the total of the purchase price and that it was indeed an obvious error to have a bigger sum in clause I which did not match the total of the sums in clauses 2, 3 & 4. That the agreement of 14th June 2012 did not state anywhere that there was a balance of UGX 914,000,000 to be paid to the Plaintiff and that the Plaintiff is attempting to adduce oral evidence which is against the Parole Evidence Rule. 7. I have addressed my mind to the testimony of the witnesses and the submissions of the counsel. Both counsel have correctly pointed out the principle under the Parole Evidence Rule in Section 92 of the Evidence Act that the contents of documents can only be proved by the documents themselves and not oral evidence. In the instant case the issue is not oral evidence per se but two conflicting documents in respect of the same transaction. 8. From the facts gathered during the hearing, the parties have known each other for some time and have had prior business transactions. It is also clear that the instant transaction was a result of prior discussions and protracted negotiations since it involved a family business. The Defendant testified that the error in the purchase price was a typo made during typing the agreement. Counsel for the Defendant submitted that the burden to prove that the Plaintiff’s signature in the agreement of 15th June 2012 was forged lay on the Plaintiff. I respectfully disagree with this position. The claim of the Plaintiff is based on the agreement dated 14th June 2012. It is the Defendant who claims it was amended or corrected in the subsequent agreement of 15th June 2012 which the Plaintiff and his wife have denied having signed. It is a principle under Section 100 of the Evidence Act that whoever desires any Court to give Judgment as to any right or liability dependent on the existence of facts which he asserts must prove that those facts exist. In the Supreme Court case of ***Aziz Kalungi Kasujja vs Naume Tebankanya Nakakande SCCS No.63 of 1998*** Justice Karokora held that

*“It must be noted that Exh. D15 was put in by the appellant. The respondent denied having written and signed it. The onus in such case was on the appellant to adduce evidence to prove that it had been written and signed by the respondent.”*

1. In the instant case both the Plaintiff and his wife denied having signed the agreement of 15th June 2012 however the Defendant only adduced a Handwriting Expert Report with regard to the Plaintiff’s signature but did not adduce any evidence that the Plaintiff’s wife signature was authored by her. DW2 stated that he went with the Plaintiff to sign the agreement of 15th June 2012 but did not state that he also went with the Plaintiff’s wife. This casts doubt on the veracity of his testimony. The Report by the Handwriting Expert therefore is not conclusive since it only addresses only one disputed signature. 2. It is further noted that the Defendant’s explanation for the error in the figure in the consideration of UGX 7,100,000,000 instead of UGX 6, 186,000,000 was due to an error in tying however the perpetrator or author of the error was never presented in court. An examination of both agreements shows that they were drafted by the legal firm of Sserwanga, Maiteki & Co Advocates who were acting for the Defendant. It is not clear why the Defendant did not adduce evidence by calling the lawyer Maiteki B. George whose stamp was on both agreements to testify as to how the error in the first agreement came about. Instead the witness who was called to corroborate the Defendant’s claim of the error was DW2 who was not the author of the error and testified that he only attended the meeting and witnessed the agreement to correct the error. The evidence of the lawyer who drafted the agreement is very important to throw light on where exactly the second agreement was signed, the persons present, why the agreement of 15th June 2012 only included the new consideration and did not specifically state that it was amending or correcting the consideration in the earlier contract. The phrase used in paragraph 6 that *“it superseded the contract of 14th June 2012”* was too generic to be used by a lawyer to amend a material aspect like the consideration of a contract. In the Supreme Court case of ***J. K Patel vs Spear Motors SCCA No. 4 of 1991*** and in the Court of Appeal case of **Pope Paul IV Social Club** **v Semakula, CACA No 41 of 2012** the Court noted that the failure to call an important witness would lead the Court to an inference that the evidence of such a witness would have been tended to be adverse to that party’s case. I find that in the instant case there was no credible evidence adduced of how and who made the error alleged in the agreement of 14th June 2012. 3. I do not agree with the submission by Counsel for the Defendant that the sums in clauses 2, 3 & 4 formed the total of the purchase price and that it was indeed an obvious error to have a bigger sum in clause I in the agreement of 14th June 2012. It is trite that Courts will not make contracts for parties but will give effect to the clear intention of the parties. In the instant case the agreement of 14th June 2012 states that “*PURCHASER agrees to buy and/or purchase all the said property at a Purchase Price or Consideration of UG SHS. 7,100,000,000.”* It further provides that from this purchase price the payments be made from the Purchase price/Consideration for certain outstanding obligations due to the vendor. 4. My understanding of clauses 1 and 2 read together is that the overall consideration is UGX 7,100,000,000 and out of this amount different payments totaling to UGX 6,186,000,000 were to be made by the Defendant. The list of payments to be made does not invalidate the full amount of consideration already agreed upon as a key aspect of the contract. The payments to be made are only aspects of the execution of the overall contract. It was testified that when arriving at the agreement between the parties, it did not take one day and negotiations were held over a period of time. I find it difficult to believe that the Defendant who had prior extensive business discussions on land matters with the Plaintiff could make a fundamental error on the figure of the total consideration especially since it was in both figures and words. This opinion is further buttressed by the testimony adduced that the Defendant insisted that the daughter of the Plaintiff who is a lawyer should be present as a witness when her father and mother were signing the agreement of 14th June 2012 but did not deem it necessary to recall her to witness the subsequent agreement that was changing a material aspect of the total consideration under the contract. 5. The letter dated 11th July 2012 (PEX.3) written by the Plaintiff to the Defendant was a follow up to the agreement of 14th June 2012 and provided a status update on the actions that had been agreed to settle debts of the vendor. It is this letter that raised the issue of the balance of UGX 914,000,000 due to the Plaintiff. It is noted that this letter was after the agreement of 15th June 2012. The Defendant adduced a letter dated 12th July 2012 (DEX.6) by the Plaintiff that states the consideration in the agreement of 14th June 2012 was based on wrong computations. Both PW1 and PW3 testified that the letterhead did not belong to them and also denied the similar letterhead and contents in a letter to KCB purported to be signed by the Plaintiff. I have examined the two letters and noted inconsistencies in the letter heads of the letters adduced by the Defendant including the font, P. O. Box address and absence of telephone numbers. The letter of 12th June 2012 was also witnessed by a deceased lawyer who could not testify as to its authenticity. 6. Defendant counsel submitted that there were inconsistencies in the Plaintiff’s conduct with regard to why the Plaintiff introduced the Defendant to the banks and creditors, transferred certificates of title, hand over vacant possession yet he had not been paid the balance of UGX 914,000,000. I find this conduct does not invalidate a written contract entered into by the parties and in any case the Plaintiff did make a written demand of the UGX 914,000,000. Similarly, I find that the omission by the Plaintiff to file a police report on the forgery of his signature and the past conduct of the Plaintiff with regard to prior business transactions between the parties is not relevant to the interpretation of the written contract between the parties. 7. On the balance of probabilities, I find that the parties agreed to a consideration of UGX 7,100,00,000 and the Defendant was to make some payments out of this purchase price. The total of payments to be made out of the consideration amounted to UGX 6,186,000,000 which is not the same as the consideration. The balance of UGX 914,000,000 is a logical deduction from the clear terms of the agreement on the consideration. The balance of UGX 914,000,000 while not stated specifically in the agreement of 14th July 2012 does not amount to oral evidence that is extrinsic to the written contract but is part and parcel of the contract. 8. I found material gaps and inconsistencies in the evidence adduced by the Defendant that the parties signed a subsequent agreement on 15th June 2012 to correct an error on the consideration. I find that the authentic agreement between the parties is the one dated 14th July 2012. Accordingly, the consideration agreed upon between the parties in the agreement of 14th June 2012 is enforceable and the unpaid balance of UGX 914,000,000 is due to the Plaintiff.

Issues No 1 and 2 are answered in the affirmative in favour of the Plaintiff.

**Issue No. 3:** ***What are the remedies available to the parties***

1. Under the plaint the Plaintiff sought recovery of the sum of UGX 914,000,000/=, being the balance of the purchase price and interest thereon and costs of the suit. 2. From the evidence adduced, I find that the Plaintiff has proved that the agreement dated 14th June 2012 is the authentic agreement signed by the parties and it provided for a total consideration/purchase price of UGX 7,100,000,000. The sum of UGX 6,186,000,000 was the total computation of debts to be paid off from the purchase price. The amount not paid out remains as part of the consideration and therefore the Defendant is indebted to the Plaintiff for the balance of UGX 914,000,000. 3. With regard to the interest, it was held in ***Omunyokol Akol Johnson v. Attorney General Civil Appeal No. 06 of 2012*** , that *“it is well settled that the award of interest is in the discretion of the Court.* I will award interest at 20% per annum on the outstanding amount of UGX 914,000,000/= from the date of filing the suit till payment in full. 4. Section 27 of the Civil Procedure Act provides that a successful party is entitled to costs unless for good cause court orders otherwise. Costs of this suit are therefore awarded to the Plaintiff 5. In conclusion, the Plaintiff’s suit succeeds with the following orders: 6. The Defendant is to pay the Plaintiff the outstanding consideration of UGX 914,000,000/= (Uganda Shillings Nine Hundred and Fourteen million) 7. Interest at 20% per annum is awarded on the above amount from the date of filing the suit until payment in full. 8. The Plaintiff is awarded costs of the suit.

It is so ordered.

**CORNELIA KAKOOZA SABIITI**

**JUDGE**

**Date: 13th October 2023**