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THE REPUBLIC OF UGANDA
IN THE HIGH COURT OF
UGANDA AT KAMPALA
(COMMERCIAL COURT
DIVISION)
HCT-00-CC-CS-0456-2005
PICA PRINTERY & STATIONERY LTD :::::::::::::::::::
PLAINTIFF
VERSUS
PALLISA DISTRICT LOCAL GOVERNMENT ::::::::::::
DEFENDANT
BEFORE: THE HONOURABLE MR. JUSTICE YOROKAMU
BAMWINE
J U D G M E N T (EX –
PARTE):
The plaintiff engages in the business of printing stationery.
It filed a suit against the defendant claiming a sum of Shs.13,388,875-
being
the outstanding balance on the cost of graduated tax tickets supplied to the
defendant in the financial year 2001/2002, general
damages for breach of
contract, interest and costs.
There is evidence of service of summons to
file a defence upon the defendant through its Chief Administrative Officer
(C.A.O) on 22/6/2005.
For reasons best known to it, the defendant did not file
a defence. On the basis of that default, an interlocutory judgment was
entered
for the plaintiff by the Registrar on 22/8/2005. The case has therefore been
put before me for formal proof only. It is
trite that where an interlocutory
judgment has been entered in favour of a plaintiff, the question of the
defendant’s liability
is no longer in issue. That was determined upon the
interlocutory judgment being entered against it. What is in issue is the
quantum
of damages. Indeed I see the only issue as whether the plaintiff is
entitled to the reliefs sought.
First, the outstanding balance and/or
special damages of Shs.13,388,875-. The plaintiff’s sole witness, PW1
Mutenga, told Court
that during the 2000/2001 financial year, the plaintiff was
awarded a tender to print and supply graduated tax tickets to the defendant
local government. That following the award of the tender and meeting with the
defendant’s C.A.O. and Chief Finance Officer
(C.F.O), the plaintiff was
issued with Local Purchase Orders (L.P.O’s) said by the said CAO and CFO.
These LPOs are on record
as P. Exh. 1. They are 6 in number. They are evidence
of the order to the plaintiff to supply graduated tax tickets worth
Shs.33,388,875-
at a cost of Shs.500 per ticket. It is the plaintiff’s
evidence that the tickets were duly delivered. The delivery notes
are on record
as P. Exh.11. The plaintiff demanded for payment. It is Mr. Mutenga’s
evidence that the defendant made a part
payment in the sum of Shs.20,000,000-
and hence the plaintiff’s claim of Shs.13,388,875- as the balance on that
deal. I have
considered the plaintiff’s claim in the pleadings; its
evidence through the General Manager Mr. Mutenga; and the documentary
evidence
exhibited in this case. It is evidence which has not been challenged and/or
contradicted. I have seen no reason to doubt
it. The law is that an unpaid
seller is entitled to recover the price of the goods supplied. In these
circumstances, the plaintiff
is entitled to special damages of Shs.13,388,875-
being the unpaid balance on the purchase price of the supplied tax tickets. I
order so.
The plaintiff has also prayed for general damages for the
breach of contract and interest from the date of default.
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 me to consider the loss of profits which
could have been earned by investing the outstanding balance in business
if the
same had been promptly paid. He has also invited me to consider the loss of the
plaintiff’s house at Makerere in order
to pay off debts which would not
have occurred if the plaintiff’s money had been paid by the defendant in
time. He has suggested
a sum of Shs.10,000,000- as reasonable compensation or
general damages for the defendant’s breach of contract which has caused
the plaintiff substantial financial loss and damage. This Court is of course
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 balance on the contract price
and that the amount could not reasonably have been expected to cause the
financial
loss and damage allegedly caused to the plaintiff, I deem a sum of
Shs.2,000,000- (two million only) adequate compensation for the
said breach. I
award it. The amount of Shs.10m proposed by counsel is certainly on the high
side.
As regards interest, its award is discretionary in the absence of
any evidence that the parties agreed on it during the tender process.
The basis
of any award of interest is that the defendant has kept the plaintiff out of his
money and ought, accordingly, to compensate
him. Court is satisfied that the
plaintiff has been unjustifiably deprived of the payment. It ought to be paid
interest as prayed.
However, its prayer is that the interest be ordered to run
from 20/4/2004, the alleged date of default. The suit was filed on 11/06/2005.
It is not known why the filing was not on the due date. In these circumstances,
interest of 20% p.a. on the special damages shall
be computed from the date of
filing (11/6/2005) till payment in full. Interest on the general damages, at
the same rate, shall be
from the date of judgment till payment in full. The
plaintiff shall also have the costs of the suit.
In summary, judgment is
entered for the plaintiff against the defendant in the following
terms:
i. Special damages: Shs.13,388,875-.
ii. General damages:
Shs.2,000,000-.
iii. Interest on (i) and (ii) at the rate of 20% p.a. from
the date of filing the suit and date of judgment, respectively, till payment
in
full.
iv. Costs of the suit.
Yorokamu Bamwine
J U D G
E
15/5/2006
15/5/2006
Plaintiff absent.
Court:
Judgment released to Civil Registry.
Yorokamu Bamwine
J U D G
E
15/5/2006
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.RTF of original document