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THE REPUBLIC OF UGANDA
IN THE HIGH COURT OF
UGANDA AT KAMPALA
(COMMERCIAL COURT
DIVISION)
HCT-00-CC-CS-0425 OF 2005
NATIONAL ENTERPRISE DEVELOPMENT
ASSOCIATION LTD
::::::::::::::::::::::: PLAINTIFF
VERSUS
1. KEZIA MBABAZI ]
2. AMERIA MOMO MASIKO]
::::::::::::::::::: DEFENDANTS
BEFORE: THE
HONOURABLE MR. JUSTICE YOROKAMU BAMWINE
J U D G M E N
T:
The Plaintiff’s claim against the Defendants jointly and
severally is for recovery of special and general damages for breach
of contract.
It is the Plaintiff’s case that sometime in may 2004, the 1st
Defendant applied for a loan facility of Shs.10,000,000- from the Plaintiff
which she would pay back in fifteen monthly instalments
with interest at the
rate of 4% per month. She is said to have received the stated amount which she
has since failed to pay back.
The 2nd Defendant guaranteed payment
of the loan which she has failed to do.
From the records, the Defendants
were served summons to file a defence on 31/5/2005. They refused and/or
neglected to file a defence.
An interlocutory Judgment was entered against them
on 5/7/2005. Accordingly, the case was put before me for formal
proof.
According to the Plaintiff’s sole witness Mukunde Devota,
PW1, the Plaintiff is a money lending company. She is its Credit
Manager. It
is her evidence that Kezia Mbabazi applied to the Plaintiff for a loan of
Shs.10,000,000- which was granted to her.
This was in May 2004. She was
supposed to be paying every month. The loan application is on record as P. Exh.
1 and the loan agreement
as P. Exh. 11. The guarantor’s undertaking is P.
Exh. 111.
It is the Plaintiff’s case that the principal and
interest due as at the time of filing the suit was Shs.8,599,600- and the
surcharge for late payment Shs.300,000-. It is the Plaintiff’s evidence
further that from the time of filing the case to-date
the 1st
Defendant has not made any payment. I accept that evidence. There is nothing
on record to contradict it.
Under 0.8 r 3 of the Civil Procedure Rules,
every allegation of fact in the plaint, if not denied specifically or by
necessary implication,
is taken to be admitted. The Defendants were served,
they did not file any defence, and an interlocutory Judgment was entered against
them. Their liability to the Plaintiff was of course determined at that level.
From the evidence on record, Court is satisfied
that the 1st
Defendant is still indebted to the Plaintiff in the sum of Shs.8,899,600- as
stated in the plaint and that payment thereof was guaranteed
by the
2nd Defendant. Each has failed in her respective obligation to the
Plaintiff. The amount is accordingly decreed to the Plaintiff against
the
Defendants jointly and severally.
The Plaintiff has prayed for monthly
interest on the outstanding amount from the date of filing the suit till payment
in full. It
has also prayed for damages.
The law is that when a party
fails to do what he/she agreed to do or does not do it properly, he is said to
be in breach of the contract.
He/she will be liable to pay damages to the
aggrieved party to compensate him for any loss occasioned. The damages which
the other
party ought to receive in respect of such a breach should be such as
may fairly and reasonably be considered as either arising naturally,
that is,
according to the usual course of things, from such a breach itself or such as
may reasonably be supposed to have been in
contemplation of the parties at the
time they made the contract as the probable result of its breach. Counsel has
invited Court
to consider the fact that the Plaintiff is a business entity
engaged in the business of lending out money. It does itself depend
on
borrowing from other institutions on interest. In my view, denying it use of
its money has occasioned loss of it.
Counsel has not suggested to Court
any figure he would consider to be appropriate for the loss suffered by the
Plaintiff. This Court
is of course cutely aware that damages are intended as
compensation for the Plaintiff’s loss. They are not intended as
punishment
for the Defendant. Bearing in mind that through this suit the
Plaintiff will recover its principal sum, I deem a sum of Shs.1,000,000-
(one
million only) adequate compensation for the said breach.
The principal
sum shall attract interest at the obtaining commercial rate from the date of
filing this suit till payment in full.
The Plaintiff shall also be paid the
costs of the suit. In the result, Judgment is entered for the Plaintiff against
the Defendants
jointly and severally as prayed in the following
terms:
i. Shs.8,899,600- as special damages.
ii. Shs.1,000,000- as general
damages.
iii. Interest on special damages at the obtaining commercial rate
from the date of filing the suit till payment in full.
iv. Interest on
general damages at the rate of 8% per annum from the date of Judgment till
payment in full.
v. Costs of the suit.
Yorokamu Bamwine
J U D G
E
9/11/2005
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.RTF of original document