[2025] UGCommC 13

### THE REPUBLIC OF UGANDA

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

## **CIVIL SUIT NO. 0771 OF 2020**

# TEAM UNIFORM LIMITED ::::::::::::::::::::::::::::::::::::

#### **VERSUS**

## **MAKERERE UNIVERSITY ::::::::::::::::::::::::::::::::::::**

#### (Before: Hon. Lady Justice Patricia Mutesi)

#### **JUDGMENT**

# **Background**

- $1.$ The Plaintiff filed this suit to recover UGX 670,055,400 being the contractual balance owing on unpaid graduation gowns, UGX 1,224,900,000 being lost legitimate expected income from the Defendant's 67^th and 68^th graduations, special damages of UGX 120,888,392 and USD 3,353.15, general damages, interest and costs of the suit. - $\overline{2}$ . Briefly, the Plaintiff's case, as can be gathered from the plaint, is that on 21^st September 2015, the Defendant's Academic Registrar invited firms to design and submit sample gowns for consideration for the award of a contract for supply of undergraduate graduation gowns. The Plaintiff emerged victorious from the bidding process which followed and it was awarded a contract to supply customised graduation gowns to the Defendant's graduands for 3 years at a unit cost of UGX 90,000 inclusive of a 10% fee for the Defendant. - 3. The Plaintiff alleges that it was the Defendant's duty to notify the Plaintiff of the number of graduands for a given graduation so that the Plaintiff can then produce a corresponding number of gowns for them. That for the 67^th graduation (2017) and the 68^th graduation (2018), the Plaintiff did not

sell all the gowns it had been instructed to produce because the Defendant allowed its staff and some market vendors from Wandegeya to produce and sell counterfeit customised gowns which heavily undermined the Plaintiff's market.

- The Plaintiff asserts that during the 69^th graduation (2019), the Defendant $4.$ unilaterally incorporated the costs of graduation gowns into graduation fees payable by all graduands. The Defendant collected all the fees for graduation gowns and was supposed to remit them to the Plaintiff within 30 days after the ceremony, less the agreed 10% commission. However, due to the open market described earlier, the Plaintiff was still not able to sell all the gowns it had been asked to produce. The Defendant also delayed and / or failed to transmit the Plaintiff's proceeds of sale. The Plaintiff finally alleges that, for the 70^th graduation (2020), the unfair open market conditions continued and that the Defendant failed to pay for most of the gowns supplied. - $5.$ On its part, the Defendant concedes that that the parties entered into a contract for the supply of graduation gowns for the years 2017, 2018 and 2019. Initially, they arranged for the Plaintiff to sell and deliver the gowns directly to the Defendant's graduands, collect the proceeds of sale and then remit 10% thereof being the agreed commission to the Defendant. From the 69^th graduation onwards, the Defendant started collecting the fees for the gowns directly from the students. It was arranged for the Plaintiff to supply the gowns to the students and then claim for payment from the Defendant. However, instead of presenting the actual list of students so supplied, the Plaintiff only presented the graduation booklets to demand for payment. - $6.$ The Defendant contends that the Plaintiff did not supply graduation gowns to all graduands in the 69^th graduation and 70^th graduation which raised a big deficit in gowns. Nonetheless, the Defendant verified all the Plaintiff's claims based on actual monies received in its accounts and

remitted all sums due to the Plaintiff. The Plaintiff's failure to deliver all the gowns required for the 70^th graduation caused great embarrassment to the Defendant and led to a written consensus between the parties in which the Plaintiff allowed the Defendant to source for gowns from other supplies only a few days to the ceremony. The Plaintiff also imported some gowns from China but failed to pay the requisite customs and other charges for them to be released thereby causing further embarrassment to the Defendant in the public.

# **Representation and hearing**

- At the hearing, the Plaintiff was represented by Mr. William Were of $7.$ Marlin Advocates while the Defendant was represented by Mr. Hudson Musoke and Ms. Esther Kabinga of Makerere University Directorate of Legal Affairs. - 8. The Plaintiff's Managing Director, Mr. Kasumba Stephen, testified as PW1 while the Defendant's University Secretary, Mr. Yusuf Kiranda, testified as DW1. The Plaintiff adduced 36 documents that were admitted into evidence at the trial and exhibited consecutively as $P. Ex.1 - P. Ex.36$ . On its part, the Defendant adduced 16 documents that were also admitted into evidence and exhibited consecutively as $D Ex.1 - D Ex.16$ . - 9. In his testimony, PW1 stated that on 21^st September 2015, the Defendant invited 5 firms to submit bids for consideration for the award of a contract for the supply of undergraduate gowns. The Plaintiff emerged as the bestevaluated bidder. On 22^nd December 2015, the Defendant then awarded the Plaintiff a contract of supply of undergraduate gowns for a period of 3 years at a unit cost of UGX 90,000 inclusive of a 10% fee for the Defendant for each gown supplied for the 67^th, 68^th, 69^th and 70^th graduations. - PW1 stated that the Plaintiff then embarked on a process of production 10. of graduation gowns in preparation for the $67^th$ graduation (2017). However, the Defendant's University Council halted the process on 21^st

October 2016. After a long wait, the Defendant communicated to PW1 its decision to reduce unit cost price from UGX 90,000 to UGX 75,000 and to enhance the security features of the gown. This led to the signing of an addendum to the contract on 20^th February 2017.

- PW1 testified that, for the $67^{th}$ and $68^{th}$ graduation ceremonies, the 11. Plaintiff was required to sell the graduation gowns directly to the students, remit the proceeds equivalent to a 10% fee to the Defendant as commission fee. The Defendant, however, failed to comply with the contract when it allowed its students to purchase counterfeit and uncustomised gowns from Wandegeya vendors and from some of its own staff thereby undermining the Plaintiff's sales. Due to this, for the 67^th graduation, the Plaintiff only managed to sell 4,000 gowns out of out over 9,000 gowns. This caused financial loss of UGX 607,500,000 to the Plaintiff. For the 68^th graduation, the same counterfeit gowns were entertained by the Defendant and the Plaintiff sold only 6,643 gowns out of 13,643 gowns leading to a loss of UGX 617,500,000. - PW1 further said that, for the 69^th graduation, the Defendant 12. incorporated the cost of graduation gowns into graduation fees payable by every student before graduation. The Plaintiff supplied 13,300 gowns that equated to UGX 1,173,060,000. However, the Defendant only remitted funds for 9,232 gowns representing a total of UGX 772,473,979. This led to a loss for 4,065 gowns equal to UGX 358,533,000. For the 70^th graduation, the Plaintiff supplied a total of 12,379 gowns but the Defendant paid for only 8,847 gowns leaving out 3,532 gowns and leading to a loss of UGX 311,522,400. The Defendant's delayed and piecemeal remittance of the money also affected the Plaintiff's production and operational capacity as a business tremendously. - 13. On his part, DW1 acknowledged that, in 2016, the Ceremonies Committee of the Defendant considered customizing the Defendant's graduation gowns, in order to make them uniform and promote Defendant's the

image and brand. The Defendant sourced 5 supplies for this purpose and the Plaintiff emerged as the best-evaluated supplier. The Plaintiff and the Defendant then signed a contract for the supply of graduation gowns on 25^th January 2016. At first, the Plaintiff was to supply the graduation gowns directly to the graduands, collect payment and then remit a 10% commission thereof to the Defendant. The Defendant never authorised anybody else to supply graduation gowns.

- DW1 confirmed that the contract commenced with the $67^th$ graduation 14. held in 2017. He maintained that the Plaintiff never remitted the 10% commission for the 67^th and 68^th graduation ceremonies to the Defendant to-date. He also clarified that, to boost the Plaintiff's sales, the Defendant's Academic Registrar issued a circular in 2018 to all graduands notifying them that the only supplier of graduation gowns was the Plaintiff. - Furthermore, DW1 told the Court that, due to the Plaintiff's refusal to 15. remit the 10% commission for the first 2 years, the Defendant decided that, for the 69^th graduation, the fees for graduation gowns would be incorporated into the graduation fees for its graduands and collected by the Defendant who would then deduct its commission and remit the rest of the money to the Plaintiff. This was another way in which the Defendant intended to support the Plaintiff by collecting the gown fees at the point of receiving the fees for graduation from each graduating student. This decision was based on good faith. In remitting the proceeds to the Plaintiff, the Defendant followed its internal financial system known as AIMS which recorded all the names of the students who paid for the graduation gowns. All due proceeds from gown sales were remitted to the Plaintiff following the AIMS record. - DW1 finally testified that, for the 70^th graduation held in 2020, the Plaintiff 16. informed the Defendant of its financial challenges in processing the gowns required and requested for an advance payment which was availed. By

10^th January 2020, however, the Plaintiff had only supplied 6,383 gowns, 900 caps and 6,792 hoods for the 13,609 graduands due to graduate that year yet the graduation ceremony was slated for $14^{th} - 17^{th}$ January 2020. The Plaintiff conceded to its incapacity to supply and allowed the Defendant to source for the gowns from elsewhere. The Defendant was also shocked to learn that the Plaintiff had imported some gowns from China but that it had failed to pay customs for them at Entebbe International Airport. The Defendant had to clear those dues to avoid further embarrassment in the public.

17. After the hearing of the suit, both counsel filed written submissions to argue the case. While initially preparing the judgment, the Court noticed that the suit contract has an arbitration clause which appears to oust the Court's jurisdiction over the dispute. The Court recalled the parties and their counsel over the development. Counsel then made oral submissions on the issue of jurisdiction. I have carefully considered counsel's submissions, the laws and authorities cited therein and all other materials on the record in reaching this judgment.

## **Issues arising**

18. The following issues have arisen for the Court's determination:

1. Whether this Court has jurisdiction over this dispute.

2. Whether the Defendant breached the contract of supply of undergraduate gowns.

3. What remedies are available to the parties.

# **Resolution of Issues**

19. I am mindful that Section 101(1) of the Evidence Act Cap 8 requires whoever desires a court to give judgment as to any legal right or liability dependent on the existence of facts which he or she asserts to prove that those facts exist. Additionally, I am mindful that Section 103 of the Evidence Act Cap 8 provides that the burden of proof as to any particular

fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on a particular person.

In civil cases of this nature, the burden of proof lies on the plaintiff to 20. prove the existence of his rights and the liability of the defendant on a balance of probabilities. In the case of Miller v Minister of Pensions [1947]2 All ER 372, Lord Denning, MR expounded on the true meaning of the phrase "balance of probabilities when he stated that:

> "... The degree is well-settled. It must carry a reasonable degree of probability but not too high as is required in a criminal case. If evidence is such that the tribunal can say, we think it more probable than not, the burden of proof is discharged, but if the probabilities are equal, it is not." Emphasis mine.

21. I will be guided by these principles on the burden and standard of proof in analyzing and evaluating the evidence adduced at the trial.

Issue one: Whether this Court has jurisdiction over this dispute.

- 22. Jurisdiction connotes the authority conferred by law upon a court, tribunal or judge to adjudicate and pass judgment over a dispute. It also refers to a court's power to hear and determine issues of law and/fact in cases before it. It is trite law that jurisdiction is a creature of statute. This means that, for a court to exercise its power of adjudication over a dispute, there has to be a statute vesting jurisdiction in that court to handle a dispute of that nature. Jurisdiction is the sole basis of a court's right to determine a dispute and to provide solutions and reliefs to the parties. (See Bwambale Semu v Kapuru Milton, HC Civil Appeal No. 0014 of 2021). - 23. The jurisdiction of the High Court of Uganda is prescribed in **Article 139(1)** of the Constitution of the Republic of Uganda, 1995 (as amended) which states:

"The High Court shall, subject to the provisions of this Constitution, have unlimited original jurisdiction in all matters and such appellate and other jurisdiction as may be conferred on it by this Constitution or other law." Emphasis mine.

Section 14(1) of the Judicature Act Cap 16 similarly provides that:

"The High Court shall, subject to the Constitution, have unlimited jurisdiction in all matters and such appellate and other jurisdiction as may be conferred on it by the Constitution or this Act or any other law." Emphasis mine.

These 2 provisions imply that this Court's unlimited original jurisdiction in all cases must be exercised subject to the Constitution. They also imply that this Court may exercise appellate and, or, other jurisdiction as may be conferred on it by the Constitution or any other law.

- 24. One of the statutes which affect this Court's jurisdiction is the Arbitration and Conciliation Act Cap 5. This Act defines the disputes which are subject to arbitration and those that are not. The Act then prescribes the procedure through which disputes that are subject to arbitration, and thus governed by the Arbitration and Conciliation Act, are to be resolved, before defining this Court's special and limited jurisdiction over such cases. - 25. Pursuant to the Section 3 of the Arbitration and Conciliation Act, a dispute is subject to arbitration and governed by the Arbitration and Conciliation Act if there is an arbitration agreement between the parties to that dispute which prescribes that such a dispute is to be settled in arbitration. That agreement has to be in writing but it may be constituted in an independent document or it may simply be a clause within a broader contractual document that sets out the rights and obligations of the parties to it. - $26.$ Section 9 of the Arbitration and Conciliation Act provides that: "Except as provided in this Act, no court shall intervene in matters" governed by this Act." Emphasis mine

This provision speaks for itself. It minimizes this Court's adjudication powers over cases and matters which are subject to the Arbitration and Conciliation Act, to the extent that that Act permits. As such, when this Court determines that a dispute before brought it is subject to arbitration and governed by the Arbitration and Conciliation Act, the Court cannot exercise jurisdiction over that dispute except as permitted by the Arbitration and Conciliation Act.

- $27.$ Mr. Were, counsel for the Plaintiff submitted that the arbitration clause in the suit contract is inoperative and incapable of being performed. He relied on the case of Security Group Uganda Ltd v Finasi-Ishu Construction SPV – SMC Ltd, HCCS No. 0829 of 2023 to argue that the arbitration clause in the suit contract lost meaning since both parties have taken substantial steps to litigate the dispute without objecting to the jurisdiction of the Court. In reply, Ms. Kabinga, counsel for the Defendant argued that the arbitration clause was operative and capable of being performed as the Defendant had always raised the need to have the matter settled amicably out of Court. - 28. Having reviewed the entire record, I am inclined to agree with Plaintiff. In the case of Security Group Uganda Ltd v Finasi-Ishu Construction SPV -**SMC Ltd** (supra), which was relied upon by counsel for the Plaintiff. Court referred to National Social Security Fund v Alcon International Ltd. CACA No. 2 of 2008, in which it was held that:

"... a party may abandon its right to arbitrate for example by delay or inaction or by commencing Court proceedings in breach of an arbitration agreement. However, the Courts are slow to find such repudiation or abandonment without very clear evidence of an intention to abandon the right to arbitrate together with reliance by *the other party to its detriment ...*" Emphasis mine.

- I cite this dictum with approval. In arbitration, party autonomy is 29. paramount. This implies that parties have the liberty to arbitrate a dispute and to decide the rules for that arbitration. However, parties to an arbitration agreement are also free to mutually repudiate or abandon that agreement and to resort to judicial adjudication in order to resolve their dispute. - 30. To this end, it is possible for a party to be said to have abandoned its right to arbitrate. This could occur when the party inordinately delays to commence arbitration or when he files and prosecutes a court case in utter disregard of the arbitration agreement. It could also happen when a defendant submits to the Court's jurisdiction and engages in the litigation to advanced stages without objecting to the jurisdiction of Court. In this sense, the arbitration agreement would have been rendered inoperative, that is to say, it would have ceased to have effect or meaning to the parties. - 31. The Court record shows that the Plaintiff filed this suit in September 2020. The Defendant filed its written statement of defence in October 2020. The Defendant did not contest the jurisdiction of the Court in its pleadings. The Court took parties through Court-assisted mediation, albeit unsuccessfully. Both parties filed notices for production of documents under Sections 64 and 65 of the Evidence Act which were complied with in part. In their scheduling memorandum, the parties agreed they had no alternative means of resolving the dispute. At the hearing, both PW1 and DW1 testified and, at the close of their testimonies, they asked Court to decide the dispute. After the hearing, Counsel for both parties also filed submissions still asking the court to decide the dispute, and the suit was reserved for judgment. - 32. Throughout all this time, the parties and their counsel did not say anything about the arbitration clause in the contract. In fact, both parties appear to have been unaware of the clause until the Court brought it up after the

hearing in 2024. Parties that are interested in commencing arbitration to resolve their dispute would never have submitted to the jurisdiction of this Court. A defendant who is interested in pursuing arbitration as an agreed form of dispute settlement would have contested the Court's jurisdiction at the earliest opportunity. In any case, counsel for the Defendant's argument that the Defendant had always sought mutual outof-court settlement of this dispute is noted, but it does not necessarily show that the Defendant ever actually took the initiative to have the dispute resolved in arbitration.

Furthermore, the case of AC Yafeng Construction Company Ltd v The 33. Living World Assembly Ltd & 2 Ors, HCCS No. 0739 of 2021 is instructive on the issue of belated invocation of arbitration clauses or agreements in advanced stages of litigation. In that case, the Court held that:

> "... A court may find a waiver of an arbitration clause when one party" engages in litigation of substantial issues going to the merits. Pretrial acts such as avoiding discovery and making motions to stay court proceedings are not inconsistent with a party's right to arbitrate. However, when a party seeking arbitration has engaged in discovery methods not available in arbitration or has engaged in other intervening steps going to the merits of the case, that party will be found to have waived the right to arbitrate. Parties should *not be allowed to invoke arbitration clauses at a late date after they* have deliberately taken action to participate in costly litigation. To allow this would undermine the purpose of arbitration, which is to promote the efficient and inexpensive resolution of disputes ..." Emphasis mine.

$34.$ I also agree with this dictum. It is not just and reasonable for a party to seek to commence arbitration when the dispute has already been entertained by the Court and when the suit is at judgment-writing stage. especially when some of the documents on record were procured through discovery which is not available *per se* in arbitration.

35. In the premises, it is my considered finding that both parties abandoned their right to arbitrate when they ignored their arbitration clause and, instead, actively participated in the proceedings in this suit. The record in this suit undoubtedly betrays a very clear intention on the part of both parties to have the dispute resolved through this suit and not through arbitration, which, perhaps, explains why the parties never mentioned the arbitration clause throughout the suit. The parties' conduct rendered the arbitration clause in the contract to be of no effect/meaning to them and, thus, inoperative. The Court finds that it has jurisdiction to hear and determine this suit and that the dispute in the suit is not governed by the Arbitration and Conciliation Act. Accordingly, this issue is answered in the affirmative

## Issue two: Whether the Defendant breached the contract of supply of undergraduate gowns.

- 36. Once a document containing contractual terms is signed, then in the absence of fraud, misrepresentation or any other vitiating factor of a contract, the party signing it is bound by its terms. A valid contract will, thereby, be formed and the parties to it will have reciprocal rights and obligations. (See William Kasozi v DFCU Bank, HCCS No. 1326 of 2000). For that reason, it is expected that those parties will duly perform their contractual obligations to the letter and in good faith. - The phrase "breach of contract" refers to the breaking of an obligation 37. that a contract imposes which confers a right of action for damages on the injured party. (See Mogas Uganda Limited v Benzina Uganda Ltd, HCCS **No. 88 of 2013).** Accordingly, breach of contract occurs once one or both of the parties fail to fulfill the obligations imposed on them by the contract (See Mwesigye Warren v Kiiza Ben, HCCS No. 320 of 2015). The party that

is injured by the breach is, naturally, entitled to relief as a result of the injury.

- 38. The suit contract in the instant case is comprised of 5 parts. One part was the "Sale Agreement for a Lumpsum Contract". The parties executed it on 25^th January 2016. It contained 5 clauses. It provided a brief background of the contract in its recitals. It provided that the Plaintiff's obligation was to supply the Defendant with undergraduate graduation gowns at a tax inclusive unit price of UGX 90,000 subject to a 10% commission fee for the Defendant. It also provided that gowns to be supplied had to conform to the sample that was agreed upon and that the bid documents submitted by the Plaintiff to the Defendant, which had formed the basis upon which the Plaintiff won the bid, would be part of the suit contract for purposes of its interpretation and enforcement. - The 2^nd part of the suit contract was, therefore, the said bid documents 39. which the Plaintiff had used to secure the contract. The 3^rd part of the contract was the General Conditions of Contract for the Procurement of Supplies ("GCC"). This part extensively prescribed many of the other aspects of the parties' consensus, including payment, delivery, dispute resolution and standards. - The 4^th part of the suit contract was the Special Conditions of Contract 40. ("SCC. This part provided for the procurement reference number, eligible countries to source materials, contract manager, applicable Incoterms, the language of the contract and the place for service of notices, among others. Save for the bid documents, these first 4 parts of the suit contract were constituted in P. Ex.1. It is unfortunate that the Plaintiff did not adduce its bid documents in evidence at the trial yet they are severally referred to in the SCC. This has meant that the Court is unable to assess any of the alleged breaches of the suit contract which have a bearing on the terms of the bid documents that are referred to in some of the other parts of the suit contract.

- The 5^th part was the 20^th February 2017 Addendum (P. Ex.2). It reduced the 41. unit price from UGX 90,000 to UGX 75,000. It provided that the sample of the gown earlier provided to secure the contract had to be improved so that a new sample is presented to the Defendant's University Council for further consideration and approval. It provided that the patent rights in the gown would be owned by the Defendant but that the Plaintiff would have rights to produce the gowns during the contract period. It provided that graduands would pay for the gowns to the Plaintiff directly who would then issue them with payment receipts, that graduands would be cleared for graduation only on presentation of the payment receipt and that the Plaintiff would remit the 10% commission to the Defendant immediately after the graduation is concluded. - 42. In the Addendum (P. Ex.2), the parties also altered the effective date of the contract to 18^th January 2017. This meant that the Plaintiff was empowered to produce gowns for the 3 graduations that followed, that is to say, the 68^th, 69^th and 70^th graduations. This implies that the Plaintiff was rightfully entitled to recover 90% of the fees for all gowns it supplied for the $70^{th}$ graduation. - 43. Four other documents were adduced at the trial containing further changes in the contractual relationship. The first of these documents was P. Ex.8 – a letter from the Defendant to all its final year students dated $11^{th}$ September 2018. It told those students that the Defendant's University Council had, at its 142^nd meeting, approved to include the cost of graduation gowns in the fees collected by the Defendant with effect from the 69^th graduation. It also increased the unit cost of graduation gowns from UGX 75,000 to UGX 98,000. P. Ex.8 is corroborated by D. Ex.5 which communicated the same information to the final year students. - It is already evident that, as the Plaintiff maintained in its pleadings and at 44. the trial, the decision to include the cost of graduation gowns in the fees to be paid by graduands and to have the gown fees, thereby, collected by

the Defendant was unilateral. This is most concerning especially since the parties had not mutually agreed upon these changes, yet those changes definitely affected the Plaintiff's interests.

- Nonetheless, as Section 67 of the Contracts Act Cap 284 provides, any 45. right, duty or liability under a contract may be varied by express agreement or the course of dealing of the parties. The Plaintiff's own evidence at trial showed that it acquiesced in these unilateral changes when it continued to produce gowns for the Defendant for the 69^th and 70^th graduation ceremonies. For that reason, the unilateral changes in the terms of gown fees collection and remittance do not amount of a breach of the suit contract by the Defendant. - 46. The other document adduced at the trial which altered the suit contract was the Consent to Procure Gowns, Hoods and Caps for the 70^th Ceremony from other Service Providers dated 11^th January 2020 (D. Ex.11). Its proves that, on 11^th January 2020 (only 3 days before the 70^th graduation then slated for $14^{th} - 17^{th}$ January 2020), the Plaintiff accepted that it had difficulties in supplying the required quantities of graduation gowns and allowed the Defendant to source for gowns, hoods and caps from other providers/producers for the 70^th Graduation Ceremonies. - The final documents with a significant implication on the suit contract at 47. this stage are the notice of termination (P. Ex.25) and the reply to the Defendant's response thereto (P. Ex.26). These prove that, on 10^th August 2020, the suit contract was terminated by the Plaintiff through its lawyers. - 48. The Court will now specifically address the different allegations of breach of contract made by the Plaintiff against the Defendant in the plaint and at the trial. One of the allegations of breach relating to the unilateral alteration of the terms of gown fees collection and remittance in respect of the 69^th and 70^th graduations has already been discounted on grounds that the Plaintiff acquiesced in the changes and continued to produce gowns at the amended prices for the Defendant's graduands.

- The other allegations of breach fall in 2 broad categories. The 1^st category 49. of allegations is that involving actions and omissions of the Defendant which undermined the Defendant's sales. It includes claims that the Defendant did not do enough, if at all, to enforce the Plaintiff's monopoly. The 2^nd category is that of claims of delayed payment and/or non-payment for all the gowns supplied. It involves claims that some payments were made outside the prescribed timeline for payment. It further includes claims that there are some gowns supplied by the Plaintiff which were not paid for at all. - 50. Turning to the claims in the first category, it was the Plaintiff's assertion that the Defendant allowed its staff and some market vendors in Wandegeya to produce and sell counterfeit gowns which heavily undermined the Plaintiff's market. This claim was repeated by PW1 at the trial. Furthermore, P. Ex.29 was a 15^th April 2019 request for extension of the contract for another 2 years. It also hinted on the same allegations and referred to an article said to have been published in the New Vision on 9^th January 2018 reporting that there were counterfeit gowns being sold in Wandegeya by vendors. - 51. In his testimony, DW1 clarified that the Defendant never authorised anybody else to supply graduation gowns for the duration of the contract. Evidence was further led through D. Ex.4 (a notice of 8^th December 2017 to graduands by the Defendant's Academic Registrar confirming the Plaintiff as the official service provider for Makerere University Graduation gowns), P. Ex.7 (the 7^th May 2018 letter to final year students indicating that gown fees had been increased and incorporated into the fees collected by the Defendant from its graduands), P. Ex.8 (11^th September 2018 notice confirming incorporation of gown fees into fees paid before graduation), P. Ex.9 (official notice confirming the Plaintiff as the official provider of graduation gowns) and the testimony of DW1 to show that the Defendant, in good faith, confirmed the Plaintiff's monopoly to its students and unequivocally undertook to collect gown fees on the Plaintiff's behalf. All these were efforts to secure and reassert the Plaintiff's monopoly which had been compromised.

- I have examined the relevant evidence on the Plaintiff's monopoly. It 52. appears that this monopoly was undermined mostly in the 67^th and 68^th graduations, although similar challenges seems to have persisted into the 69^th and 70^th graduations. There is no doubt in my mind that the intention of the parties was that the Plaintiff becomes the sole supplier of undergraduate gowns for the 67^th, 68^th, 69^th and 70^th graduations. I am also satisfied, from the evidence adduced, that this never came to pass because the Plaintiff's monopoly was severally breached at the hands of unauthorised producers of gowns for the entirety of the duration of the suit contract. - I appreciate the Defendant's efforts, especially after the 68^th graduation, 53. to find a solution to this problem. However, I am in agreement with the Plaintiff that the Defendant could have done more to enforce the monopoly in light of the letter and spirit of the suit contract. In fact, I am convinced that the solution to the problem was so simple and that it is very surprising that the Defendant did not resort to it and stick to it in the first place. As it has already been noted earlier, Clause (iii)(d) of the Addendum (P. Ex.2) clarified that the arrangement between the parties was that:

"The graduands will pay money for the graduation gowns directly to *M/S Team Uniform Ltd who will issue them with payment receipts.*

Before any graduand picks a graduation invitation card, he/she will have to present evidence of payment for the graduation gown in the *form of a payment receipt ...*" Emphasis mine.

54. To lock out counterfeit gowns, the Defendant only had to stick to the words of Clause (iii)(d) of P. Ex.2. The Defendant's Academic Registrar simply had to insist and ensure that no graduand would get a graduation

invitation card, and thus be invited for the graduation ceremony, without presenting to him or her a payment receipt confirming that he or she had purchased his or her gown from the Plaintiff. Indeed, apart from the Defendant's inattention and laxity, there is no other logical explanation for how graduands who had not bought gowns from the Plaintiff were able to obtain invitation cards for the 4 respective graduation ceremonies. It had already been expressly agreed that such cards could only be secured by graduands on presentation of gown payment receipts issued by the Plaintiff. If the Defendant had stuck to this arrangement, the counterfeit gowns would not have affected the Plaintiff's market for the 4 graduations.

- The Defendant's laxity in enforcing Clause (iii)(d) of the Addendum (P. Ex.2) 55. directly undermined the Plaintiff's market. On one hand, the Plaintiff was the official provider of the gowns. On the other hand, the Defendant's Academic Registrar allowed graduands who had not presented gown payment receipts from the Plaintiff to access the graduation tent. This was in utter breach of the Plaintiff's right to a monopoly over the production of graduation gowns as agreed in the suit contract. - I now move to the 2^nd category of claims of breach of contract which posits 56. that there was delayed and/or non-payment for some of the gowns supplied. These claims arose from the 69^th and 70^th graduations when the Defendant had taken over the role of collecting the gown fees. Clause 16.3 of the GCC provides that:

"Unless otherwise specified in the SCC, payments shall be made *promptly by the Procuring and Disposing Entity, no later than thirty* (30) days after submission of an invoice or request for payment by the Provider, and its certification by the Procuring and Disposing *Entity*". Emphasis mine.

57. In paras. 12 and 13 of the plaint, the Plaintiff averred that it produced and supplied 13,300 gowns for the 69^th graduation. The Plaintiff averred that,

at the unit fee of UGX 88,200 after deducting the Defendant's 10%, it was entitled to UGX 1,173,060,000 for its supplies. The Plaintiff concedes that the Defendant paid for 9,235 gowns in 4 installments (UGX 100,000,000 on 8^th January 2019, UGX 141,999,000 on 22^nd February 2019, UGX 222,322,996 on 12^th March 2019 and UGX 308,151,975 on 28^th September 2019). The Plaintiff omitted to plead the respective dates on which it submitted its request for payment. Therefore, it is not possible for Court to assess whether or not the payments were made outside the time set out in Clause 16.3 of the GCC. The Plaintiff also alleged that the Defendant failed to pay for 4,065 gowns supplied for the 69^th graduation and which caused a balance of UGX 358,533,000.

- 58. In para. 14 of the plaint, the Plaintiff averred that it produced and supplied the Defendant with 12,379 gowns at a unit fee of UGX 88,200 after deducting the Defendant's 10%. The Plaintiff concedes that the Defendant paid UGX 780,305,400 for a total of 8,847 gowns, leaving a balance of UGX 311,522,400 for 3,532 gowns unpaid. Again, the Plaintiff omitted to plead the dates on which it submitted requests for the funds. It also omitted to plead the dates on which the said money was paid. As such, Court is unable to assess whether or not the money was paid out of time in the context of Clause 16.3 of the GCC. - 59. From the 2 preceding paragraphs, it is evident that what remains in issue is the alleged non-payment for 4,065 gowns supplied for the 69^th graduation which occasioned a balance of UGX 358,533,000 and for 3,532 gowns that were supplied for the 70^th graduation which occasioned a balance of UGX 311,522,400. In his examination in chief, PW1 testified that the arrangement in place to ensure that the correct number of gowns was produced by the Plaintiff was that, in preparing for graduation, the Defendant used to inform the Plaintiff how many graduands were there for that graduation and require the Plaintiff to produce a corresponding number of gowns for them following the graduation handbook. P. Ex.5 and P. Ex.6 (the graduation handbooks for the $69^{th}$ and $70^{th}$ graduations)

corroborate the total numbers of graduands for claimed by the Plaintiff for the 2 graduations.

- 60. I find PW1's said testimony in the preceding paragraph to be reasonable. The only way the Plaintiff could prepare for the graduations is by accessing the lists/numbers of graduands for a particular graduation so that it can produce the corresponding number of gowns for them. As such, the Plaintiff's reliance on the graduation booklets in proof of the number of gowns it produces is not far-fetched. In examination in chief. DW1 criticized the Plaintiff's reliance on the graduation booklets because some of the graduands would eventually not follow through with graduation. DW1 averred that the only conclusive evidence of the gowns to be paid for should be derived from the Plaintiff's payment receipts issued to graduands when they purchased the gowns. - 61. I do not agree with this suggestion. The Plaintiff was entitled to payment for producing the gowns, irrespective of whether the graduands turned up to purchase the gowns. The Plaintiff would already have expended resources to produce the gowns relying on the Defendant's disclosed lists or numbers of graduands. As I have already held, it was the Defendant's duty to put in place measures to ensure that its graduands would not graduate with any other gown other than that made by the Plaintiff. It was the Defendant, and not the Plaintiff, who had control over the graduands and the graduation ceremony. I do not think that it would be fair for the Plaintiff to make losses for unpurchased gowns yet the Defendant failed to heed to the express terms of the contract and allowed graduands to graduate with gowns other than those produced by the Plaintiff. Since the Defendant had usurped the gown fees collection duty for the 69^th and 70^th graduations, the Plaintiff's role simply remained gown production. It would then distribute them to graduands as per the lists and then wait for the Defendant to remit its share of the gown fees.

- DW1's reasoning for his suggestion was that, the graduation booklets 62. were unreliable since some of the students included there would sometimes not follow through with graduation that year or would not attend the ceremony. This possibility is real and the parties ought to have cured it in their contract. However, they did not do so after the gown fees collection role was usurped by the Defendant in 2018, yet the Plaintiff was still expected to produce enough gowns and be ready for graduation. In my considered opinion, the Plaintiff is entitled to payment for all gowns it produced which correspond with the number of graduands for a graduation, pursuant to the equitable doctrines of quantum meruit and restitution. The management of graduands to ensure that they purchase/pay for gowns was not the Plaintiff's duty. In any case, the Defendant did not substantiate/prove which of the graduands listed in the respective graduation booklets failed to show up for graduation and the Court is unable to deduct that number from the one claimed. - I am satisfied that the Plaintiff's claim for the unpaid price of gowns 63. supplied for the 69^th graduation should succeed, less withholding tax. It matters not whether or not the Defendant's graduands picked gowns from the Plaintiff. All that matters is that there was a contract entitling the Plaintiff to a clear monopoly over the supply of gowns, that the Plaintiff produced gowns which corresponded with the number of graduands disclosed by the Defendant in its respective graduation booklets, and that the Defendant omitted to adduce evidence to actually prove how many graduands listed in those booklets did not show up for the graduation ceremony. Thus the Plaintiff's claim for supplies made in respect of the 69^th graduation succeeds, subject to withholding tax. - For the 70^th graduation, the claim for unpaid gown fees must succeed only 64. in part. The Plaintiff claims it supplied 12,379 gowns. DW1 testified at para. 32 of his witness statement that, by 10^th January 2020, the Plaintiff had only supplied 6,383 gowns out of 13,609 gowns needed. The 70^th graduation was scheduled to commence on 14^th January 2020. D. Ex.11 is

a consent given by the Plaintiff to the Defendant on 11th January 2020 allowing the Defendant to procure gowns, hoods and caps from other providers. D. Ex.8 (minutes of contracts committee meeting of 12^th January 2020 appointing MAK Holdings Ltd to supply gowns) and D. Ex.9 (correspondence between the Defendant and MAK Holdings Ltd) prove that the Defendant made an order for 5,000 gowns following the Plaintiff's consent.

- 65. I note that the Plaintiff incorporated the cost of hoods and caps for its 70^th graduation claim. However, these two items do not feature anywhere in the contractual documents and they were not costed by the parties. From DW1'S explanation at the trial, a gown was to include a hood and a cap for it to be said to be a full gown. Therefore, the Court will not venture into costing them or assessing the sums due for their production by the Plaintiff since they had been costed together with the gown itself. - 66. In my considered opinion, DW1 was not very truthful in his testimony. If the Defendant had only received 6,383 gowns, this would have created a deficit of 7,226 gowns out of the total of the 13,609 gowns needed. Why would the Defendant then order for only 5,000 gowns yet it needed 7,226 gowns for the shortfall? This does not seem rational/reasonable at all. If the Defendant wanted to close the deficit, it would have ordered for the exact number of gowns needed to close that deficit. I am thus inclined to disbelieve DW1's claim that only 6,383 gowns had been delivered by the Plaintiff at the time. - On the basis of the same reasoning, I am inclined to disbelieve the 67. Plaintiff's claim and evidence that it supplied 12,379 gowns. If the Plaintiff had indeed supplied 12,379 gowns out of 13,609 gowns needed, thereby leaving a deficit of only 1,230 gowns, why would it sign a consent allowing the Defendant to source for 5000 gowns which was more than that deficit? Why wouldn't that deficit expressly be specified in the consent? More intriguingly, why would the Defendant order for 5,000 gowns if the

deficit was only 1,230 gowns? My considered view is that the Defendant could not have ordered for more or less gowns than it needed. It could not have ordered for 5,000 gowns if it only needed 1,230 gowns.

- In signing the 11^th January 2020 consent (D. Ex.11), the Plaintiff effectively 68. gave the Defendant a blank cheque. The blank cheque allowed the Defendant to source and procure graduation gowns of whichever quality and quantity as was necessary to deal with the impasse at the time. The Plaintiff, in effect, acquiesced in that emergency procurement and only has itself to blame for whatever number of gowns were procured by the Defendant. - In all fairness, it would be reasonable to take it that the Plaintiff could only 69. have supplied the difference between the number of gowns required and the number of gowns ordered for by the Defendant. This is because, as has already been noted, the Defendant could not have ordered for more or less gowns that it needed. If the Defendant ordered for 5,000 gowns from MAK Holdings Ltd, it is reasonable to conclude that the deficit at the time was 5,000 gowns. Ultimately, this implies that, at the time, the Plaintiff had only supplied 8,609 gowns. Whether or not the Plaintiff supplied gowns after the 11^th January 2020 consent is inconsequential. Any sum claimed in respect of those supplies is not recoverable by the Plaintiff because, after that date, the Defendant re-directed the gown fees to pay for its consequent 5,000 gowns order to MAK Holdings Ltd. I, thus, find that the Plaintiff only supplied 8,609 gowns for the 70^th graduation. - The Court will now determine whether or not all the 8,609 gowns were 70. paid for. In para. 14 of the plaint, the Plaintiff concedes that the Defendant paid UGX 780,305,400 for 8,847 gowns. Having found that the Plaintiff supplied 8,609 gowns, it is already obvious to me that there was an over payment if the UGX 780,305,400 is to be attributed to the 70^th graduation alone. There was an excess payment for 238 gowns which were not supplied.

- Finally, to ascertain whether or not there was a breach of the suit contract 71. through non-payment for gowns supplied, it is necessary to ascertain how much was due from the 69^th graduation and from the 70^th graduation. For the 69^th graduation, Court confirmed that there is an outstanding balance of UGX 358,533,000. When the withholding tax rate of 6% is applied, the result is that UGX 334,021,020 remains outstanding from the 69^th graduation. For the 70^th graduation, the Court confirmed that there was an over-payment in respect of 238 gowns to the tune of UGX 20,991,600. When the two sums are balanced against each other, the result is that UGX 313,029,420 remains outstanding and the Defendant breached the suit contract in failing and, or, refusing to pay that sum. - 72. The Defendant raised issue with the Plaintiff's failure to present all payment receipts and, or, lists of students who actually picked the gowns. I do not find merit in this complaint. When the Defendant unilaterally changed the terms of payment of the gown fees for the 69^th and 70^th graduations, the Plaintiff was left to play catch-up. The changes rendered payment receipts redundant as it was the Defendant who started collecting gown fees. It became useless for the Plaintiff to issue payment receipts because it was no longer receiving payments directly from graduands. Second, even if the list of students who picked gowns was not adduced, that list was not very relevant to the fact in issue. The fact in issue is the number of gowns produced by the Plaintiff as a result of the Defendant's graduation booklets. The list of those who picked gowns would not show how many gowns were produced in total. - 73. Additionally, as it will be clarified further in Issue 3, it is the position of this Court that, while it was necessary for the Plaintiff to bring payment receipts at the trial to prove the number of gowns it should be paid for in respect of the 67^th and 68^th graduations, it was not necessary for the Plaintiff to bring similar receipts to prove the number of gowns it should be paid for in respect of the 69^th and 70^th graduations. Briefly, the reason for this position is that, for the $67^th$ and $68^th$ graduations, the Plaintiff was the one collecting gown fees and, as such, was expected to have complied strictly with Clause (iii)(d) of the Addendum by issuing and keeping a record of payment receipts. On the other hand, for the 69^th and 70^th graduations, the Defendant had usurped the gown fees collection role and so the Plaintiff cannot be expected to have kept a record of payment receipts which it was no longer issuing.

- 74. Accordingly, the Court finds that the Defendant breached the suit contract when it refused and / or failed to remit UGX 313,029,420 due for the gowns supplied by the Plaintiff for the 69^th and 70^th graduations. Additionally, it is now evident that there has been delayed payment of that sum following the Plaintiff's several unheeded demand letters exhibited at the trial as $P. Ex.27 - 30$ and $P. Ex.32 - 33$ . Therefore this issue is answered in the affirmative. - 75. I have noted that the Defendant also accused the Plaintiff of several breaches of the suit contract. However, the Court cannot descend into these claims on the basis that the Defendant did not file a counterclaim against the Plaintiff. The only prayer the Defendant made in its written statement of defence was that the suit is dismissed with costs. The Defendant did not ask the Court to make any findings or award any reliefs following its allegations of breach of contract. As such, the said allegations cannot be investigated by the Court.

## Issue 3: What reliefs are available to the parties.

Having found that the Defendant breached the suit contract, the 76. Defendant's prayer for dismissal of the suit with costs fails. As earlier noted, a party who suffers injury as a result of breach of contract is entitled to relief. The Plaintiff prayed for the following reliefs in the plaint:

(a) Payment of UGX 670,055,400 as contractual unpaid graduation gowns fees for the $69$ ^th and $70$ ^th graduation ceremonies.

In view of my findings in the preceding issue, I find that UGX 313,029,420 77. is due and owing to the Plaintiff from the Defendant as the gown fees balance for the supplies made in respect of the 69^th and 70^th graduation ceremonies.

(b) Payment of UGX 120,888,392 and USD 3,353.15 as special damages.

- 78. In the case of Stanbic Bank Uganda Ltd v Hajji Yahaya Sekalega t/s Sekalega Enterprises, HCCS No. 185 of 2009, it was held that special damages must be specifically pleaded and proved. Special damages refer to pecuniary loss that is ascertained and quantifiable at the time the suit is filed. Although proof of special damages has to be specific, it need not be documentary in nature. - In paras. 16 and 17 of the plaint, the Plaintiff averred that its special 79. damages claim arises from its outsourcing of gowns from China for the 70^th graduation. The Plaintiff contends that the delays in payments by the Defendant forced it to incur extra expenses of producing large volumes of gowns from China within a short period of time to ensure that the 70^th graduation does not flop. DW1's response in para. 37 of his witness statement was that the Plaintiff had, all along, assured the Defendant that that it would procure the gowns from the Ugandan market and was shocked to learn that the same had been outsourced from China without its (the Defendant's) consent. - Indeed, D. Ex.7 is a 10^th January 2020 letter from the Defendant warning 80. the Plaintiff that the procurement of gowns from China violated Clause 22.1 of the GCC which required the Plaintiff to notify the Defendant of any subcontracts entered into under the suit contract and of the renowned Government of Uganda Policy of Buy Uganda, Build Uganda (BUBU). The Plaintiff has neither pleaded nor proved that it complied with Clause 22.1 of the GCC by notifying the Defendant that it had outsourced the production of the gowns to China.

- I am inclined to agree with the Defendant on this claim. Clause 22.2 of the 81. GCC, which has to be read together with Clause 22.1 thereof, demands that all subcontracts that could have been entered into by the Plaintiff under the contract had to comply with Clauses 3 and 7 of the GCC. Clause 3 of the GCC provides for the prohibition of corrupt practices in public procurement and, among others, permits a procuring and disposing entity to suspend firms that are involved in such practices, inspect accounts of such firms and terminate contracts upon the discovery of such practices. Clause 7 of the GCC provides that subcontractors must have the nationality of an eligible country. As per the SCC, the eligible countries are prescribed in the bid documents which, as earlier noted, were not adduced in Court. - 82. Nonetheless, I am satisfied that, since the Plaintiff blatantly ignored Clause 22.1 of the GCC, there was no way for the Defendant to verify, prior to the subcontracts, if Clauses 3 and 7 had been satisfied vet they are central to the fundamental principles governing public procurement in Uganda and to the Government of Uganda's emphasis on increasing market for local content. It is thus evident that the Plaintiff's subcontracts for production of gowns in China contravened the GCC. It is trite law that no action can arise from a dishonourable or from an unlawful cause. The Plaintiff cannot secure any compensation for expenses it incurred while breaching the suit contract. This claim fails.

(c) Payment of UGX 1,224,900,000 as lost legitimate expected income for the $67$ ^th and $68$ ^th graduation ceremonies.

83. In issue 2 above, the Court found that the Defendant breached Clause (iii)(d) of the Addendum (P. Ex.2). The Court is now called upon to determine if that breach occasioned loss of legitimate expected income of UGX 1,224,900,000. The Plaintiff averred in the plaint that, for the 67^th graduation, it made losses of UGX 607,500,000 after it failed to sell 9,000 gowns as a result of the said breach. It further averred that, for the 68^th

graduation, it made losses of UGX 617,400,000 after it failed to sell 7,000 gowns.

- First, the Plaintiff's claim in respect of the 68^th graduation is grossly 84. bloated and inaccurate since the Plaintiff applied a net unit fee of UGX 88,200 for the 68^th graduation supplies, yet the unit fee for gowns at that graduation was UGX 67,500. This implies that, at best, the legitimate income for non-sale of 7,000 gowns for that graduation would have been UGX 472,500,000. - Second, unlike the 69^th and 70^th graduations when the Defendant 85. collected all the gown fees, the Plaintiff collected the gown fees for the 67^th and 68^th graduations. As such, while the payment receipts for the gowns sold in the 69^th and 70^th graduation were issued by the Defendant. thereby rendering Clause (iii)(d) of the Addendum redundant as earlier noted, the payment receipts for the 67^th and 68^th graduations were issued by the Plaintiff. It is expected that the Plaintiff should have all payment receipts for the gowns it supplied during the 67^th and 68^th graduations. For that reason, while it was reasonable for the Court to find earlier that it was not necessary for the Plaintiff to present payment receipts to prove the number of gowns it supplied for the 69^th and 70^th graduations after the Defendant usurped the gown fees collection role under the suit agreement, it is now only fair and just that the Plaintiff is held to have been under a duty to present all receipts for gowns supplied during the 67^th and 68^th graduations since it is the one that was still exercising the gown fees collection function at the time. - 86. The Plaintiff adduced voluminous records of some payment receipts at the trial. I have meticulously searched through all these 30 volumes of payment receipts which were collectively exhibited as P. Ex.10. The payment receipts all relate to the 69^th graduation. The Plaintiff did not adduce the receipts it issued to graduands who paid for gowns for the 67^th and 68^th graduation yet these are the only receipts that could have helped

the Court ascertain the exact numbers of gowns sold by the Plaintiff and those unsold, which in turn, would have enabled the Court ascertain the exact financial loss which arose from the Defendant's failure to protect the Plaintiff's monopoly over the supply of graduation gowns for the 67^th and $68^th$ graduations.

- 87. To this end, the Plaintiff appears to be guilty of 2 strategic flaws in preparing and prosecuting its case. The Plaintiff adduced the unnecessary volumes of payment receipts (for the 69^th graduation) and it also omitted to adduce the necessary receipts (for the $67^{th}$ and $68^{th}$ graduations). - Unable to analyse the payment receipts for gowns supplied for the 67^th 88. and 68^th graduations for itself, Court cannot verify the exact numbers of gowns sold by the Plaintiff and those not sold so as to determine the actual loss occasioned. This stalemate inevitably implies that, at the trial, the Plaintiff failed to lay an adequate evidential basis for the claim for loss of legitimate expected income as it omitted to adduce the payment receipts for gowns it supplied for the 67^th and 68^th graduations. Accordingly, the Plaintiff's prayer for lost legitimate expected income fails.

(d) Interest on (a), (b) and (c) above at the commercial rate of $28\%$ p.a. from the date of breach of contract till payment in full.

- 89. Under Section 26(2) of the Civil Procedure Act, Court has the power to award interest on the damages awarded in a suit. Ordinarily, a successful plaintiff is entitled to interest at a rate which would not neglect the prevailing economic value of money but which would also insulate him or her against further economic vagaries, like inflation and depreciation of the currency, in the event that the money ordered to be recovered is not paid promptly when it falls due. See (Mohanlal Kakubhai Radia v Warid Telecom Uganda Ltd, HCCS No. 0224 of 2011). - In view of these principles, the Court hereby awards interest to the 90. Plaintiff on sum awarded in (a) above (UGX 313,029,420) at the rate of

19% p.a. from 17^th February 2020 (30 days after the 70^th graduation ceremonies ended) till full payment.

## (e) General damages

- General damages are the losses which flow naturally from the defendant's 91. breach. They are what the law presumes to be the direct, natural or probable result of the defendant's breach (See Opia Moses v Chukia Lumago Roselyn & 5 Ors, HCCS No. 0022 of 2013). General damages are what the law implies and presumes to have accrued from the wrong complained of. They are also taken to be the immediate, direct, proximate or the necessary result of the wrong complained of. - 92. The Court found that the Defendant breached the contract by failing in its duty to enforce the Plaintiff's monopoly and by delaying and failing to pay all the due fees for the 69^th graduation. The direct, natural and probable result of these breaches is that the Plaintiff suffered financial loss. inconvenience, loss of business opportunities in the absence of its business capital, as well as cash-flow difficulties. - 93. Nonetheless, the Court is also alive to the fact that the Plaintiff did not plead and prove any measures it undertook to mitigate its losses. It is noted that, as PW1 explained at the trial, each gown was customised for a particular year and could not be re-used the following year. However, I am not convinced that the gowns could not be re-purposed in any way given the Plaintiff's and PW1's expertise. PW1 told Court that he has held a Master's degree in Fine Art from the Defendant for the last 25 years since 1999 and that he enjoys a wide array of experiences involving personal art exhibitions in Uganda and beyond. He also told Court that the Plaintiff is engaged in the business of embroidery, stitching, needle-work, tailoring and logo printing, among other related lines of production. Surely, with all this expertise, I am convinced that the Plaintiff could have found a way to re-purpose the unsold gowns so as to mitigate its losses.

- I am not convinced by the Plaintiff's insinuation that the gowns could only 94. be re-used as gowns in the following year. That was not the only available option. Instead of focusing on whether the gowns could be re-used the next year, the Plaintiff could have focused on re-purposing the material/fabric making up the gowns for other uses. In fact, after the trial, the Court was left wondering what had happened to the unsold gowns. Did the Plaintiff dispose of them, destroy them, re-use them or re-purpose them? The Plaintiff failed to plead and prove where these unsold gowns went. While it is clear that the Plaintiff is entitled to payment for the gowns, it is not clear whether or not the Plaintiff was still able to benefit from them as it disposed of them or if they are still somewhere in a store, able to be re-purposed for financial gain. - 95. Considering all these factors, the Court deems it fair, just and reasonable to award the Plaintiff UGX 30,000,000 in general damages.

(f) Interest on (e) above at the rate of $25\%$ p.a. from the date of judgment till payment in full.

96. Following the legal principles for the award of interest on decrees described above, the Court deems it fair, just and reasonable to award interest on the general damages awarded to the Plaintiff at the rate of 15% per annum from the date of judgment until payment in full.

$(q)$ Costs of the suit.

97. **Section 27(1)** of the **Civil Procedure Act** permits this Court to award costs in a suit before it. The general rule is that costs follow the event. This implies that an award of costs will generally flow with the result of litigation. A party who is successful in a case is entitled to costs, unless Court, for good reason, orders otherwise. (See Kwizera Eddie v Attorney General, SC Const. Appeal No. No. 01 of 2008). In this case, there is no reason to deny the Plaintiff the costs following its success in the suit. I accordingly award the costs of the suit to the Plaintiff.

## **Reliefs**

- Consequently, this suit succeeds in substantial part and I make the 98. following orders: - The Defendant shall pay UGX 313,029,420 being the unpaid balance on $\mathbf{i}$ . gowns supplied for the 69^th and 70^th graduations to the Plaintiff. - ii. The Defendant shall pay interest on the amount in (i) above at the rate of 19% p.a. from 17^th February 2020 until payment in full. - The Defendant shall pay UGX 30,000,000 as general damages for iii. breach of contract to the Plaintiff. - The Defendant shall pay interest on the amount in (iii) above at the rate iv. of 15% p.a. from the date of judgment until payment in full. - Costs of the suit are awarded to the Plaintiff. $V$ .

atrica denter

Patricia Mutesi **JUDGE**

$(17/02/2025)$