[2025] UGHC 197

#### **THE REPUBLIC OF UGANDA IN THE HIGH COURT OF UGANDA AT MASAKA CIVIL SUIT NO. 20 OF 2022**

### **KKINGO PARENTS TRANSPORTERS CO. LTD::::::::::::::::::::::::::PLAINTIFF VERSUS**

#### **KARUNGI ELIZABETH:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::DEFENDANT**

#### **BEFORE: HON. JUSTICE LAWRENCE TWEYANZE**

#### **JUDGMENT**

#### **Introduction**

- 1. This matter arises from a commercial dispute between the Plaintiff, Kkingo Parents Transporters Co. Ltd, and the Defendant, Karungi Elizabeth, concerning an alleged breach of a sale and purchase agreement for four buses. The Plaintiff seeks remedies including the recovery of UGX 552,000,000/= (Uganda Shillings Five Hundred Fifty -Two Million Only) as the outstanding balance, or alternatively the return of the buses in good mechanical condition, alongside special damages of UGX 42,058,460/=, general damages, interest, and costs of the suit. - 2. The Defendant failed to file a defence or appear at the hearing despite proper service, leading to an interlocutory judgment under Order 9 Rule 8 of the Civil Procedure Rules and the matter proceeding ex-parte for formal proof. This judgment is delivered following a thorough evaluation of the Plaintiff's evidence and applicable law.

#### **Background and facts**

3. The Plaintiff's case is grounded in a sale and purchase agreement dated 6th October 2021 (admitted as Exhibit PEX1), wherein the Defendant agreed to purchase four buses with registration numbers UBB 928B, UBB 940T, UBB 598T, and UBE 689R from the Plaintiff for a total sum of UGX 1,250,000,000/= (Uganda Shillings One Billion Two Hundred Fifty Million Only). The Defendant paid an initial deposit of UGX 600,000,000/= (Uganda

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Shillings Six Hundred Million Only) upon signing, leaving a balance of UGX 650,000,000/= (Uganda Shillings Six Hundred Fifty Million Only).

- 4. The agreement stipulated that the balance be paid through a standing order of UGX 28,000,000/= into the Plaintiff's Cairo Bank account on the 28th day of each month until fully settled. The Plaintiff alleges that the Defendant breached the agreement by failing to adhere to the payment schedule, making only partial payments totaling UGX 98,000,000/= outside the agreed timelines for October, November, December 2021, and part of January 2022, leaving an outstanding balance of UGX 552,000,000/=. - 5. Following the breach, the Plaintiff issued demand notices dated 9th November 2021 and 30th November 2021 collectively marked as PEX2, which the Defendant ignored. The Plaintiff further claims to have incurred special damages totaling UGX 42,058,460/= due to the breach, including insurance costs, tax obligations, Auditors' fees, and loan interest penalties, supported by documentary evidence (Exhibits PEX3 to PEX6). - 6. Service of the summons and Plaint was effected on 29th March 2022 by Kaliisa Richard, as confirmed by his affidavit of service and a video recording on a flash disk admitted and reviewed by the Court. The Defendant refused to acknowledge service, insisting on dialogue with the Plaintiff's Director, Robert Asiimwe. On 20th March 2022, during the formal proof hearing, the Defendant did not appear despite the trial Judge personally contacting her on telephone numbers 0772342896 and 0758009096 while in Court upon requesting for her contacts to ascertain why she was not in Court. She promised to call back and the matter was stood over for over thirty (30) minutes but she failed to call back or even come to Court any other day, the Court then proceeded ex-parte, satisfied with the evidence of service.

# **Representation**

7. The Plaintiff was represented by M/s Sekabanja & Co. Advocates and M/s Kawanga & Kasule Advocates. The Defendant was neither represented nor did she file a defence. There were no any written submissions filed by the Plaintiff.

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#### **Issues for determination**

- 8. The facts of this case raise the following issues for determination: - *1. Whether there was a breach of contract by the Defendant.* - *2. What remedies, if any, are available to the Plaintiff?*

# **Burden and standard of proof**

9. In civil proceedings, the burden of proof rests on the Plaintiff to establish their case on a balance of probabilities, as stipulated under *Section 103 of the Evidence Act, Cap 8*. This burden persists even in ex-parte proceedings following an interlocutory judgment, where the Defendant's liability is presumed, and the focus shifts to assessing the quantum of damages (*see Ewadra Emmanuel vs. Spencon Services Ltd HCCS No. 0022 of 2015; Smith vs. Auto Electrical Services Ltd [1951] 24 KLR 22*). The Plaintiff must prove each element of the claim, including the existence of a contract, its breach, and the resulting loss.

### **Evidence**

- 10. The Plaintiff called one witness, PW1, Asiimwe Robert, the Company Director, who testified via a Witness Statement admitted into evidence. The following exhibits were relied upon: - o PEX1: Sale and purchase agreement dated 6th October 2021. - o PEX2: Demand notices dated 9th November 2021 and 30th November 2021. - o PEX3: Insurance cover from Uganda Excel Insurance for 2022. - o PEX4: Table of Uganda Revenue Authority (URA) income tax payments. - o PEX5: URA receipts of payments. - o PEX6: Bank loan statements showing accrued interest and penalties.

# **Determination**

#### **Issue 1: Whether there was a breach of contract?**

11. A contract is defined under *Section 2 of the Contracts Act* as an agreement enforceable by law, requiring free consent, capacity to contract, lawful consideration, a lawful object, and an intention to be legally bound (see also Section 10). The Court in *Greenboat Entertainment Ltd vs. City Council of Kampala HCCS No. 0580 of 2003* outlined that a valid contract necessitates capacity, intention, consensus ad idem, valuable consideration, legality of

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purpose, and certainty of terms. Breach occurs when a party fails to fulfill its obligations under the contract (See *Black's Law Dictionary, 5th Ed., pg. 171; Nakana Trading Co. Ltd vs. Coffee Marketing Board [Civil Suit No. 137 of 1991*]).

- 12. The evidence on Court record establishes that a valid contract existed between the Plaintiff and the Defendant, as evidenced by Exhibit PEX1. The terms required the Defendant to pay UGX 1,250,000,000/= for the buses, with UGX 600,000,000/= paid as a deposit and the balance of UGX 650,000,000/= to be settled via monthly payments of UGX 28,000,000/= starting 28th October 2021. The Defendant's partial payments of UGX 98,000,000/= outside the agreed schedule, leaving UGX 552,000,000/= unpaid, constitute a clear failure to perform her obligations. - 13. The Plaintiff's demand notices (PEX2) and the Defendant's failure to respond or file a defence reinforce this finding. Under *Section 101 of the Evidence Act***,** the burden lies on the Plaintiff to prove the breach, which they have done on a balance of probabilities. The Defendant's non-participation raises a presumption of the Plaintiff's claims being true (See *United Building Services Ltd vs. Yafesi Muzira T/A Quickset Builders* **HCCS No. 154 of 2005)**. Accordingly, I find that the Defendant is in breach of the contract dated 6th October 2021. - 14. This issue 1 is answered in the affirmative.

# **Issue 2: What remedies are available to the Plaintiff?**

15. The Plaintiff seeks the recovery of UGX 552,000,000/= as the outstanding balance, or alternatively the return of the four buses in good condition, special damages of UGX 42,058,460/=, general damages, interest at 30% per annum, and costs. The Court will address each remedy in turn.

# **a) Recovery of Outstanding Balance or Return of Buses**

16. The Plaintiff is entitled to the outstanding UGX 552,000,000/= as the unpaid portion of the contract price, supported by Exhibit PEX1 and the payment history. The alternative remedy of returning the buses is viable under contract law where specific performance or restitution is sought (see *Hadley vs. Baxendale [1854] 9 Exch 341*). However, given the Plaintiff's primary



claim for the monetary balance and the absence of evidence on the buses' current condition, I award UGX 552,000,000/= as the principal sum.

# **b) Interest**

17.*Section 26(2) of the Civil Procedure Act* grants the Court discretion to award interest to compensate the Plaintiff for being deprived of their monies. In *Premchandra Shenoi vs. Maximov Oleg Petrovich SCCA No. 9 of 2003*, the Supreme Court held that interest reflects the economic value of money and inflation. In this case, the Plaintiff seeks 30% per annum, but considering prevailing economic conditions and judicial precedent (*Kinyera vs. Management Committee of Laroo Building Primary School [HCCS No. 099 of 2013]*), an interest rate of 18% per annum from the date of filing (20th March 2022) until payment in full is just and reasonable.

# **c) General Damages**

18. General damages aim to restore the Plaintiff to their pre-breach position and are awarded at the Court's discretion (See *Kibimba Rice Ltd vs. Umar Salim SC Civil Appeal No. 17 of 1992*). The Plaintiff's evidence of inconvenience, including Cairo Bank loans linked to the contract, justifies an award. Assessing the value of the subject matter being UGX 552,000,000/= and the economic inconvenience, I award UGX 50,000,000/= as general damages, which is proportionate and sufficient to meet the ends of justice.

# **d) Special Damages**

19. Special damages must be specifically pleaded and strictly proved (See *Borham-Carter vs. Hyde Park Hotel [1948] 64 TLR; Masaka Municipal Council vs. Semogerere [1998-2000] HCB 23).* The Plaintiff claims UGX 42,058,460/= for insurance (UGX 32,103,460/=), URA taxes (UGX 2,455,000/=), Auditors' fees (UGX 2,500,000/=), and loan penalties (UGX 10,080,000/=), supported by Exhibits PEX3 to PEX6. The Court finds that this evidence meets the threshold of strict proof, and I award UGX 42,058,460/= as special damages.

# **e) Costs**

20. Under *Section 27(2) of the Civil Procedure Act*, costs follow the event unless there is a reason to deny them. The Plaintiff has incurred expenses to

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prosecute this case, and no such reason exists. Costs are therefore awarded to the Plaintiff.

# **Final orders**

- 21. For the reasons stated above, judgment is entered in favour of the Plaintiff against the Defendant as follows: - a. A declaration that the Defendant is in breach of the sale and purchase agreement dated 6th October 2021. - b. The Defendant shall pay the Plaintiff UGX 552,000,000/= (Uganda Shillings Five Hundred Fifty-Two Million Only) as the outstanding balance. - c. The Plaintiff is awarded UGX 50,000,000/= (Uganda Shillings Fifty Million Only) as general damages. - d. The Plaintiff is awarded UGX 42,058,460/= (Uganda Shillings Forty-Two Million Fifty-Eight Thousand Four Hundred Sixty Only) as special damages. - e. Interest at 18% per annum on the principal sum of UGX 552,000,000/= from 20th March 2022 (date of filing) until payment in full. - f. The Plaintiff is awarded the costs of this suit.

I so order.

Judgment delivered electronically at Masaka this 16th day of April, 2025.