Mugambe v Kayita and Another (Civil Suit No. 339 of 2020) [2022] UGHCCD 117 (8 August 2022)

Key Facts

Transaction Type

Issues

• Whether the defendants negligently performed the construction works?
• What remedies are available?
• Whether there was a breach of contract, if so by whom?
• Whether the 1st defendant misrepresented the 2nd defendant's technical capacity and capability to perform the contract.

Holdings

• The court determined that the defendants negligently performed the construction works, deviating from standard professional practices. This included employing unqualified supervisors and executing work with poor craftsmanship, leading to defects such as cracked plaster and faulty door frames.
• The court ruled that the plaintiff failed to prove the 1st defendant misrepresented the 2nd defendant's technical capacity to perform the contract. The alleged statements were not shown to be material or false in a way that induced the contract.
• The plaintiff was awarded UGX 27,000,000 in special damages for the technical audit and UGX 225,000,000 in general damages for financial and personal loss caused by the breach. The counterclaim by the 2nd defendant was dismissed as baseless.
• The court found that the defendants breached the construction contract by failing to complete the works within the stipulated 6-month period and by delivering substandard, defective work. The defendants were jointly and severally liable for this breach.

Remedies

• The court awarded 20% interest on the general damages (UGX 225,000,000) from the date of the judgment.
• The court awarded the plaintiff general damages of UGX 225,000,000/=. This was to compensate for the financial and personal inconvenience caused by the defendants' breach of contract and poor workmanship.
• The court awarded 15% interest on the special damages (UGX 27,000,000) from the date the suit was filed.
• The counterclaim filed by the defendants was dismissed with costs, as they failed to prove their claims.
• The plaintiff was awarded the costs of the legal proceedings against the defendants.
• The court awarded the plaintiff special damages of UGX 27,000,000/=. This amount was for the fees paid for the technical audit to assess the defective works executed by the defendants.

Contract Value

Monetary Damages

Legal Principles

• The court applied the principle of pacta sunt servanda (the sanctity of contracts) to determine that the defendants breached their contractual obligations. It held that the terms of the written agreement between the plaintiff and the 2nd defendant must be strictly adhered to, and unilateral extensions or alterations without written consent were invalid. The court found the defendants failed to complete the works within the stipulated 6-month period, violating the contract's terms.
• The court established that the defendants owed a duty of care to perform the construction works with reasonable skill and attention. This duty was breached due to poor workmanship, lack of supervision, and use of unqualified personnel. The judgment cited legal precedents (e.g., Henderson vs Merrett Syndicates Ltd) to affirm that professional negligence in contract performance can lead to tortious liability.
• While not explicitly listed in the schema, the court applied principles of restitution for unjust enrichment. It ruled that the defendants were unjustly enriched by receiving payments for incomplete and defective work, and the plaintiff was entitled to compensation to restore her position as if the contract had been properly performed.
• The court determined that the defendants' failure to complete the finishing works within the 6-month contract period and their substandard execution constituted a breach. This included neglecting to supervise the work properly, using unqualified site workers, and not adhering to the agreed scope of works. The plaintiff was deemed the innocent party entitled to damages.

Precedent Name

• Pasley vs Freeman
• Henderson vs Merrett Syndicates Ltd
• Esso Petroleum Co Ltd vs Mardon
• Esther Sempebwa v The Non-Performing Assets Recovery Trust
• Golden Construction Co. Ltd v Stateco (Nig) Ltd
• Boschcon Civil & Electrical Construction Company (U) Ltd v Salini Costruttori Spa
• Great Eastern Hotel Co Ltd v John Laing Construction Ltd & Anor
• Hedley Byrne & Co. Ltd v Heller & Partners Ltd
• Tesco Stores Ltd vs Costain Construction Ltd & Others

Key Disputed Contract Clauses

• The contract required the defendants to supervise and direct the construction works using their best skills and attention, which they allegedly failed to do, leading to poor workmanship and defective work.
• The construction agreement stipulated completion within 6 months from execution (3rd July 2019), but the defendants did not finish the works, and no written agreement was proven to extend the deadline.
• Counsel for the defendants argued the contract automatically renewed beyond 6 months if not terminated with 30 days' notice, but the court found no evidence of such renewal or written agreement.
• The contract outlined specific finishing works (plastering, painting, tiling, etc.), but the defendants' execution fell short, including unaligned plaster, cracked tiles, and defective door frames.
• The court analyzed whether the defendants' work fell below the standard of a reasonable skilled contractor, finding they breached their duty of care through poor supervision and unqualified personnel.

Cited Statute

• Company's Act (2012)
• Building Control Act (2013) and Building Control Regulations (2020)
• Contracts Act No. 07 of 2010

Judge Name

Passage Text

• The court finds that the defendant's poor workmanship resulted in defective work... The defendant, therefore, breached their end of the contract by giving the plaintiff defective works.
• I, therefore, find that the defendants breached their contract with the plaintiff.
• I, therefore, find that the 1st defendant did not misrepresent the 2nd defendant's technical capacity and capability to perform the contract.

Damages / Relief Type

• Plaintiff awarded UGX 27,000,000 in special damages for technical audit costs.
• Counterclaim dismissed with costs as it was found baseless.
• Plaintiff awarded UGX 225,000,000 in general damages for breach of contract and negligence.
• 15% interest on special damages from the date of filing.
• 20% interest on general damages from the date of judgment.
• Plaintiff awarded costs of the legal proceedings.