Commercial Law Index

The applicant instituted a civil suit against the respondent in 2013 in a lower court. This suit was in relation to a consulting and ICT support services fees provided by the applicant for the respondent. With the applicant having not taken any step to prosecute the matter since 2013, the respondent applied to have the suit dismissed for want of prosecution. The court accordingly dismissed the suit. 

In this court, the applicant sought an order to reinstate this civil suit and set aside the dismissal. The respondent contended that the applicant’s failure to take steps to prosecute the suit against the respondent for over three years, was justification for dismissal of want of prosecution. Furthermore, the applicant had not shown any justification for failure to take these requisite steps.

The respondent thus claimed that this application would prejudice him as he had been burdened by the suit since 2013. 

This court held that the reinstatement of this civil suit would indeed prejudice the respondent. The application was dismissed on the grounds that it defeats the defence of limitation (as the claim or suit proceeded out of time) available to the respondent.
 

The plaintiff supplier sued the defendant – its Local Technical Representative (LTR) in accordance with the National Drug Authority Act for the distribution of pharmaceutical products – for breach of contract. The defendant failed to pay the plaintiff for the assorted products it supplied. The plaintiff consequently claimed for loss of income, damages, interest and costs of suit. The defendant lodged a counter-claim alleging that the plaintiff/first counter-defendant had breached the memorandum of understanding concluded between the parties and had, through various means, attempted to cripple the defendant’s/counter-claimant’s enterprise. It alleged further, as the basis of its challenge to the legality of the arrangement between the first and second counter-defendants, that the just-mentioned parties had colluded in this endeavour so as allow the latter to become the new LTR. 

The defendants/counter-claimants successfully raised the procedural bar of res judicata – which prohibits judicially-decided matters from being heard afresh a second time – concerning the plaintiff’s claim, given that the matter of their indebtedness thereto had been resolved in the settlement of antecedent winding-up proceedings. To what extent ought the defendant’s/counter-claimant’s challenge have been raised as part of the previous lawsuit? Suggesting that res judicata was applicable to both parties’ claims, the court nevertheless considered the counter-claimant’s’ case in respect of the first and second counter-defendants and found no measure of illegality or bad faith on the evidence. The counter-claimant was additionally time-barred from seeking review of the National Drug Authority’s decision over the LTR change. 

The plaintiff’s suit and defendants’ counter-claims were accordingly dismissed with costs.
 

The issues before the court were whether the registrar erred in law when he did not exercise his jurisdiction to refer the matter to a judge for a final disposal of issues he had found as contentious in his ruling; whether the learned registrar erred in law when he unilaterally dismissed the matter without determining the contentious issues raised therein and whether it is in the interest of justice that the appellant is granted leave to tax its Advocate-Client Bill of Costs.

The court stated that the claims did not arise out of a single transaction and the best way forward for the applicant was to file an action (civil suit) to recover these various claims.

The court came to the conclusion that the application was for recovery of costs and the registrar had no jurisdiction to entertain a dispute between advocate and client as to whether costs or fees were due. Secondly it is alleged that the bill is illegal or arises from an illegal contract. The court upheld the registrar’s decision not to entertain the bill and refer the parties to a suit with the only question remaining of whether he ought to have referred the parties to the judge for trial of the suit. The court reiterated that the registrar reached the right conclusion.
The matter of recovery of costs was contentious and the registrar had no jurisdiction to entertain it. 

The court dismissed the appeal.
 

In this case the applicant wanted a writ of mandamus to compel the first respondent to pay the outstanding amounts with interest as ordered from the High Court. This case emphasizes that there must be a clear right in order to use a mandamus.

The court held that in order to obtain a writ of mandamus the following must be established: (1) a clear legal right and a corresponding duty in the respondent; (2) that some specific act or thing which the law requires that particular officer to do has been omitted to be done by him; (3) lack of any alternative, and (4) whether the alternative remedy exists but is inconvenient, less beneficial or less effective or totally ineffective.

The rights of the party seeking the writ of mandamus must not be doubtable. The court was not satisfied that the issues regarding the interest to be awarded and the amount due where properly determined. The court found that the applicant’s rights were doubtable. The court dismissed the application and advised the parties to seek an appropriate intervention to give proper interpretation of the trial judge’s judgment.

This case concerned an application for an injunction restraining the respondents from selling or enforcing a mortgage in respect of the applicant’s mortgaged properties, pending the determination of a civil suit. 

A preliminary objection was raised that the second, third, fourth and fifth applicants’ application was not supported by affidavit evidence. The court held that the first applicant’s supporting affidavit and supplementary affidavit would remain intact, and the applicant’s case would survive. Striking out the second to fifth applicants would not do away with the substance of the application.

The grounds for granting an injunction are that the applicant must prove a prima facie case with a likelihood of success; the applicant is likely to suffer irreparable injury that would not be adequately compensated for by damages; and if the court is in doubt it will decide the matter on a balance of convenience. As regards the first ground the court held that there was no prima facie case or serious question to be tried that had the potential of avoiding realization of the outstanding loan amount. This ground was based on whether the contract between the applicant and first respondent was frustrated, in that the applicant was still awaiting payment for the petroleum products sold; the purchase of which was funded by a loan from the respondent. As a result, the applicant contended it could not repay the loan. Evidence showed that there was a delay in payment, and not frustration of contract.

The application for an injunction was dismissed.
 

This was an action claiming monies allegedly siphoned from the plaintiff’s bank account with the participation and/or collusion of the defendant; and damages for the defendant’s breach of the fiduciary duty as branch manager. The defendant filed a counterclaim that his continued suspension and dismissal was unlawful. 

The issues for consideration were whether the defendant caused financial loss to the plaintiff; whether the suspension and/or dismissal was lawful; and the available remedies.

Regarding the first issue, the court held that the suit rested on the allegation that the defendant kept 26 cheques. The court held that it was not proved that the defendant kept the cheques beyond the three days alleged by the plaintiff; however the court found that the defendant knew the cheques were kept beyond the three days. As a result, the defendant was jointly liable with a Mr Patrick Kigongo.

On the second issue, the court held that the plaintiff was entitled to suspend the defendant as he was charged with a criminal offence. Management may dismiss an employee who was facing criminal prosecution if their continued employment would prejudice the interests of the bank. However, the defendant was suspended without pay contrary to regulation 30 of the terms and conditions of service; and the termination was without notice of disciplinary action, without a right of defence, and was thus unlawful.

The plaintiff was awarded general damages. The defendant was awarded his full salary from the date of suspension until the date of termination.
 

The Uganda Land Commission transferred a
parcel of land to the first respondent in 2005,
which leased the land to the second
respondent. In 2006, the appellant wrote to
the Ugandan Land Commission and received
a lease offer for the same land that had
already been transferred to the first
respondent. Both the respondents and the
appellant have been issued a certificate of
title for the same property. In first instance,
the trial judge ruled in favour of the
respondents. The appellant then filed an
appeal.

The court was called upon to determine the authority of the Uganda Revenue Authority to transfer tax liability and collect money from bankers holding money for alleged offenders under the VAT Act.

The court decided 2 of 5 agreed points of law. Firstly, the court considered whether the defendant's decision to impose and transfer a tax liability of Uganda Shillings 5,553,634,271/= from SureTelecom Uganda Limited to the 1st plaintiff was legal. The court held that the purported transfer of liability from SureTelecom Uganda Limited was unlawful because it infringed the right of the first Plaintiff to be charged and tried before a court of law or an independent tribunal for the offence which the penal tax was imposed. The court agreed with the defendant that it was acceptable for a director of a company to be held liable for the offences of a company in absence of proof that they lacked knowledge of the offence or had tried to stop the commission thereof. However, the court noted that the Commissioner had compounded the offence prior to court proceedings without having an admission from the first plaintiff and thus violated his fundamental right to a fair hearing as envisaged by section 28 of the Constitution. Accordingly, the court found in favour of the first plaintiff. Secondly, the court considered whether the defendant’s act of issuing agency notices to and subsequently collecting USD 800,000 from the 2nd Plaintiff’s bankers in respect of the 1st Plaintiff’s tax liability is lawful or legal. Based on the determination of the previous issue, the court found in favour of both plaintiffs in this issue.

The court considered whether the petitioner was unable to pay his debts, a bankruptcy order could be granted and whether the petitioner had any properties to be administered by a trustee in bankruptcy.

The court held that a petitioner must prove that he is unable to pay his debts exceeding Uganda Shillings fifty million in terms of Insolvency Act s 3. Further, once a debtor files a petition the court has the jurisdiction to determine the matter as it deems fit and order is granted where the petitioner has filed a statement of affairs with the official receiver in terms of s 4 of the act.

The court found that the petitioner had shown that he was unable to pay his debts by attaching his statements of account. The petitioner also did not file his statement with the official receiver.

Accordingly, the court dismissed the petition.

This was a ruling on an application for a temporary injunction to restrain the respondent from using or trading in goods bearing the applicant’s registered trademark (moon with a logo).

The competitors in this case were in the same industry trading in textile materials and goods under the logos ‘Purple Moon Uganda Limited’ established in Uganda (applicant) and ‘Z moon Purple moon’ established in China (respondent). The court applied the principle of territoriality and held that the applicant was the registered owner of the trademark in dispute and had the right to stop the respondent from using the mark.

The court held that the respondent’s mark was infringing since it was similar in wording (moon) to the applicant’s registered mark in Uganda and was likely to deceive customers in the course of trade.

The court also determined whether the respondent had the capacity (locus standi) to challenge registration of a trademark in Uganda. The court applied the rule that an agent of an owner of a registered mark in a Paris Convention member country had such capacity. The court observed that the respondents were not agents of the two companies that had registered the trademark in China thus lacked capacity.

Accordingly, the court issued the injunction as prayed for and costs of the application subject to the outcome of the main suit.

The plaintiffs sued the defendant for breach of contract.  The first plaintiff claimed US $190,747 for services rendered to the defendant. The second plaintiff claimed US $3,085 being the outstanding balance for provision of services to the defendant before their contract was terminated. The plaintiffs each reached a settlement agreement in which the defendant was going to pay a portion of the claimed amount. 

The plaintiffs later claimed they concluded the first payment under duress, and sought the full amounts originally claimed plus interest. 

The defended raised a defence of res judicata on the grounds that the case was premised on a subject matter which has been previously decided. It produced letters of acknowledgment of full payment.
The court dismissed the res judicata defence on the basis that this was a different case because there were new parties and that the plaintiffs were now seeking interest. However, the court held that there was no evidence of duress and if the plaintiffs were assaulted they should have made a police report. The court ruled that it cannot ignore the letter of acknowledgement of full payment on the grounds that a contract entered by parties should be respected. 

The case was dismissed with costs.
 

The matter arose from a dispute about the detention of goods belonging to the second plaintiff by the defendant. 

The first issue was whether the detention was lawful. Section 214 of the East African Community Customs Act required notice of detention to owners when known. As ownership was not clear, the court observed that notice was not necessary. It also further reasoned that the conduct of the defendant did not amount to seizure as the goods were already in their hands with the knowledge of owners before they were impounded. The court thus held lack of notice did not breach the legislation and therefore not unlawful. 

On whether the goods were wrongfully detained, the court reasoned that the act of holding out representation of title by the second plaintiff and the allegations of fraud was cause for investigation by the defendants and consequent detention pending investigation of ownership. Further, the defendant was legally obliged to hold on to the goods as a lien pending the demand of payment of tax. The detention was therefore lawful. 

Lastly, the court considered whether the MoU entered into by the plaintiffs and defendant was entered into by duress. Citing Pao On v Lau [1979] 3 ALL ER 65 for factors to prove duress, the court noted that the plaintiffs protested and denied indebtedness arising from the memorandum of understanding (MoU) but did not necessarily repudiate immediately or seek redress. It thus reasoned that the actions of the plaintiff did not show duress and therefore held the MoU was entered without duress.
 

This is a case relating to to a contractual dispute where the plaintiff was suing the defendant for breach of contract.

The defendant had been contracted by the Uganda Revenue Authority to construct a border post. The defendant then sub-contracted the plaintiff to perform certain work under three contracts. The plaintiff alleged that the defendant unlawfully terminated one of the contracts after they demanded payment. The defendant contended that it was the plaintiff who unilaterally terminated the contract by halting work at the site resulting in the defendant taking over the work. The defendant further counter-claimed that the plaintiff used some of their equipment and as result the plaintiff owes them compensation.
 
The court held that there were disparities between the plaintiff’s witnesses and that the defendant did not unilaterally terminate the contract. It ruled that the defendant could not be held liable for any sum of money beyond payment for work the plaintiff had actually performed. The court also found that there was no evidence to show that the amount of work done was to a value in excess of what was paid. 

The case was dismissed. The counter-claim was equally dismissed for lack of evidence
 

The dispute emanated from the arrest of the plaintiff’s workers on the instruction of defendant, the National Forestry Authority on allegation of illegally felling trees. This was despite the fact that the plaintiff was licensed to harvest the trees. The plaintiff was forced to pay 150 000 shillings for the tools and logs impounded by the police.

The plaintiff claimed compensation amounting to 3 million shillings for mistreatment, mental health and psychological torture at the hands of the defendant. She further claimed special damages for loss of income. The plaintiff submitted that the defendant breached the license awarded to the plaintiff to harvest abandoned logs

The defendant contended that that the plaintiff breached her license by illegally harvesting timber beyond what was permitted by the license. It argued that the plaintiff’s claim was outrageous in view of the fact that she abandoned the license and that the allegations of mistreatment was frivolous. On special damages, the defended argued that the plaintiff failed to produce evidence to show any loss.

In deciding the matter, the court held that the defendant was in breach of its obligations towards the plaintiff and awarded damages of 3 million shillings for breach of the contract, lost opportunities and inconveniences suffered. The claim for special damages was dismissed.