Birungi v Ahinduraho (Civil Suit 70 of 2021) [2024] UGHC 382 (29 May 2024)

#### IN THE HIGH COURT OF UGANDA AT MBARARA THE REPUBLIC OF UGANDA ELLY BIRUNGI TUMWINE HCT-05-CV-CS-0070-2021 PLAINTIFF

#### VERSUS

AHINDURAHo HOPE DEFENDANT

## BEFORE: HON LADY JUSTICE JOYCE KAVUMA

#### JUDGMENT

## Introduction.

The Plaintiff brought this suit against the Defendant for recovery of UGX 60,460,500/= being a sum he alleged to have advanced to the Defendant.

He alleged that between 6th November 2019 and 10th October 2020 he advanced to the Defendant a total sum of UGX 28,760,000/= in nine instalments onto her Bank Account no. 6120100067 in respect of two business ventures the two had agreed to share profits from.

COWS. He alleged further that in the month of August 2020 he again advanced the Defendant a sum of UGX 12,500,000/= on an agreement that the Defendant was to purchase for him a piece of land but did not purchase. That in the same month, he advanced the Defendant UGX 19,200,500/= upon mutual agreement that she would purchase for him

That when the Defendant did not perform any of the above promises. the two entered into an agreement in which the Defendant committed

herself to refund to the Plaintiff UGX $58,543,000/$ = part of the money he had advanced to her.

$[2]$ When the hearing in this matter commenced on 1<sup>st</sup> December 2022, I observed that the Defendant was not in court. Counsel for the Plaintiff pointed it out to this court that despite having been served prior to the hearing, the Defendant had ignored to file her defence. Counsel further stated that an affidavit of service had been filed in the matter. Upon perusal of the court record, this court was satisfied from the affidavit deposed to by a one Mr. Tayima Bruno dated 24<sup>th</sup> June 2022 that the Defendant had been properly served.

Counsel prayed that the suit proceeds under Order 9 rule 11(2) of the Civil Procedure Rules which prayer was granted and the suit was set down for formal proof and hearing ex parte.

### Representation.

The Plaintiff was represented by Mr. Emmanuel Muhumuza $[3]$ learned counsel. Counsel filed written submissions which I considered in coming to this judgment.

# The evidence at trial.

The Plaintiff led evidence through two witnesses. $[4]$

PW1 Birungi Elly Tumwine testified in chief that sometime in September 2019 he entered into an agreement with the Defendant to transact a series of businesses which included manufacture of Hope Bar Soap,

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startup a clinic and share proceeds, purchase of land and purchase of cattle. TThat between 6th November 2019 and 10th October 2020, he advanced to the Defendant UGX 28.760.000/= to be invested in the soap and clinic business and that the said money was deposited on the Defendant's centenary account No. 6120100067.

That sometime in August 2020, while he was abroad, he advanced to the Defendant UGX 12,500,000/= to purchase for him a piece of land but the Defendant did not do so. That in the same month, he advanced to the Defendant UGX 19,200,500/= for purchasing cows and that the Defendant assured hím that she had bought the said cows but she did not.

That when he returned to Uganda and found that the Defendant had not performed any of the above obligations, he reached an agreement with her to make a refund of UGX 58,543.000/=.

PW2 Akankwasa Edvinah testified in chief that she was the Plaintiffs friend. That PW1, on several occasions requested him to send money to the Defendant through mobile agents or on her joint account with her husband in Centenary Bank. That whereas she could not trace the money he deposited for the Defendant through mobile money agents. he could trace the money he deposited on the Defendant's joint account in Centenary Bank. That he made the said deposits from 6th November 2019 up to 6th January 2022 and by that last date he had deposited onto the Defendant's account a total sum of UGX 8,260,000/=,

Analysis and decision of the court.

Counsel for the Plaintiff raised the following issues for resolution $[5]$ by this court;

- 1. Whether there was a valid contract between the Plaintiff and the Defendant and if so, whether the Defendant breached the contract. - 2. Whether the Plaintiff disbursed to the Defendant UGX $60,460,500/$ = to purchase cows, fund the clinic business, fund the manufacturing of bar soap and purchase of land. - 3. Whether the Plaintiff is entitled to recover his monies amounting to UGX $60,460,500/$ advanced to the Defendant in the course of dealings between the Plaintiff and the Defendant. - 4. Remedies available.

Issue 1: Whether there was a valid contract between the Plaintiff and the Defendant and if so, whether the Defendant breached the contract.

On this issue, counsel for the Plaintiff submitted that the parties $[6]$ entered into a mutual agreement to transact in a series of business transactions. That from the Plaintiff's evidence, the Plaintiff presented annexure "A" a laundry bar soap that was shared with him on phone by the Defendant to show that she was manufacturing soap that needed funding from the Plaintiff that they would share proceeds thereof. That further the Plaintiff presented PE1 (a bank statement) showing how he paid money to the Defendant as consideration for their transaction and that PE2 the agreement between the parties showed the Defendant promising to pay UGX 58,543,000/=.

On whether the Defendant breached the contract, counsel submitted that by the Plaintiff sending money to the Defendant and by the fact that the Defendant shared photos of the cows and soap to the Plaintiff, it was a clear explanation that there existed a valid contract. That the photos showed a promise and the agreement PE2 indicated that the Defendant breached the contract.

[7] When the court sets down a suit for formal proof as it did in the instant matter, the Plaintiff is under a legal duty to place before the court evidence to sustain their averments in his or her plaint. The pleading and submissions are secondary to the case as they do not form the evidence in the matter. The court will strictly apply the provisions of Sections 101 to 104 and 106 of the Evidence Act.

Therefore, the Plaintiff being desirous of this court giving judgment as to legal rights or liability dependent on the existence of facts which he asserts, must prove that those facts exist. (See Nsubuga vs Kavuma [1978] HCB 307).

It is not always a given that where no Defence is filed by the adversary or one is struck out that the Plaintiff shall automatically be entitled to a decision in their favor. The court has to be guided by the evidence adduced by the Plaintiff before it can reach a decision. This being a case in which the Plaintiff claimed a breach of contract, he had the legal burden to show first the existence of a contract and its essential terms,

secondly, a breach of a duty imposed by the contract and thirdly, any resultant damages.

[8] Section 2 of the Contracts Act, 2010, defines a contract as "an agreement enforceable by law made with free consent of the parties with capacity to contract, for a lawful consideration and with a lawful object, with the intention to be legally bound". (See also Section 10 of the Act).

Furthermore, Section 10(5) of the aforementioned Act is to the effect that a contract the subject matter of which exceeds twenty-five currency points (UGX 500,000/=) must be in writing.

In Musoke Kitenda vs Roko Contruction Limited (High Court Misc. Application no. 1240 of 2020), this court authoritatively observed that:

> "The witing envisaged does not require a formal written contract. This requirement is satisfied by any signed writing that; reasonably identifies the subject matter of the contract: is sufficient to indicate that a contract exists, and states with reasonable certainty the material ternms of the contract. It can be a recejpt or even an informal letter. " Per Mubiru U.

In the instant case, counsel for the Plaintiff alleged that the Plaintiff and the Defendant entered into a mutual agreement to transact in a series of business transactions. On the basis of the annexures to the plaint, counsel implies that a contract was executed between the two parties. [9] The Plaintiff claimed that a total sum of UGX 60,000,000/= was advanced to the Defendant l observe that of all the evidence that the Plaintiff relied upon, no written contract was presented to this court as required by Section 10(5) of the Contracts Act, 2010 this being an alleged agreement in excess of UGX 500,000/=.

In Musoke Kitenda (supra), the court opined further that:

"Part performance of an oral contract makes it enforceable in equity...it is a doctrine of equity that a contract required to be evidenced in writing will still be enforceable even if it is not sO evidenced provided that one of the parties does certain acts by which the contract is partly performed..part performance is achieved when pursuant to the contract visible acts are taken by the party seeking tO enforce it, such as handing over possession of the subject matter of the Contract...it would be intolerable in equity for one party to knowingly suffer another to invest time. labour and money on the item, upon the faith of a contract which did not exist.

[10] Of all the annexures relied upon, only the Demand Deposit Statement of the Defendant's joint account no. 6120100067 with a one Tumusiime Francis and an agreement in which the Defendant agreed to repay to the Plaintiff a sum of UGX 58,542,858/= were properly admitted in court as exhibits. The rest of the documents remained to be

identified and properly admitted by the court. This greatly affected their evidential value in the matter.

The evidence before me specifically, the demand deposit statement of a joint account belonging to the Defendant and a one Tumusiime Francis shows that;

- (1) On 6th November 2019 PW2 deposited onto the Defendant's joint account a total Sum of UGX 5,510,000/=. - (ii) On 6th January 2020 PW2 deposited onto the Defendant's joint account a total sum of UGX 2,750,000/=. - (ii) On 10th October 2020 PW1 deposited onto the Defendant's joint acCount a total sum of UGX 3,500,000/=. - (iv) On 10th October 2020 PW1 deposited onto the Defendant's joint account a total sum of UGX 20,500,000/=.

Defendant. The above deposits were indicative of a partial performance on the part of the Plaintiff towards his unwritten mutual agreenment with the

[11] Despite the agreement not being enforceable as a contract within the Contracts Act, 2010 owing to the fact that it vwas un written, according to Section 54 of the Contracts Act 2010, a person who receives any advantage under an agreement or contract which is void is bound to restore it or to pay compensation for it to the person from whom he or she received the advantage. This is the law against unjust enrichment. (See for example Lanex Forex Bureau Ltd vs Mulangwe (Court of Appeal Civil Appeal No. 190 of 2016).

In Dr. James Kashugyera Tumwine & Anor vs Sr. Willie Magara 6 Anor HCCS No. 576 of 2004, it was observed by this court that:

> "Money which is paid to one person wvhich rightfully belongs to another, as where money paid by A to B on a Consideration which has wholly failed, is said to be money had and received by B to the use of A, lt is recoverable by action by A. The paying of A to B according to the Learned Author ofA Concise Law Dictionary by P. G Osborn 3h Edn gh P. 212 beconmes a quasi-contract an obligation not created by but similar to that created by contract and is independent of the consent of the person bound... The other view is that in the action for money had and received liability is based on unjust enrichment i.e the action is applicable whenever the defendant has received money which in justice and equality belongs to the plaintiff under circumstances which render the recejpt of it by the defendarnt a receipt to the use of the plaintiff" Per Bamwine J (as he was then).

The total amount of the deposits made to the Defendant's joint account by both PW1 and PW2 in this case was UGX 28,760,000/=.

This was the only money that the Plaintiff was able to prove to this court as having been advanced to the Defendant for which the Plaintiff could in my considered opinion maintain an action for money had and received. It would be unjust to the Plaintiff if this court were to let the Defendant derive benefit of the said sums and it would equally amount to unjust enrichment on the part of the Defendant.

In the upshot, the Plaintiff has proved to this court the existence of an unwritten agreement with the Defendant from which he is entitled to recover UGX 28,760,000/= from her as money had and received by $\frac{1}{2}$ her.

Furthermore, my findings above fully resolve issues 2 and 3 raised by the counsel for the Plaintiff in their submissions.

## Issue 4: Remedies available.

[12] In his plaint, the Plaintiff prayed for;

(a) Recovery of UGX 60,460,000/ $=$

(b)General damages on (a) above.

- (c) Interest on (a) and (b) at court rate from the date of filling till payment in full. - (d)Costs of the suit.

In relation to general damages prayed for, the law on award of general damages is now well settled. General damages are at the discretion of court and their award is not meant to punish the wrong party, but to restore the innocent party to the position he or she would have been had damage not occurred. (See Uganda Commercial Bank vs Kigozi

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## [2002| 1 EA 305, Charles Acire vs M. Engonda HCCS No. 143 of 1993 and Kibimba Rice vs Umar Salim Supreme Court Civil Appeal no. 17 of 1992).

It is now settled that in reaching a quantum of general damages, the Court considers the nature of harm, the value of the subject matter and the economic inconvenience that the injured party might have been put through.

T have not found any compelling reason, on the evidence before this court to justify an award of general damages. They are therefore denied.

On interest, the law is that the award of interest is at the discretion of the court. The determination of the rate of interest is also at the discretion of the court. (See Omunyokol Akol Johnson vs Attorney General [2012] UGSC 4).

According to Section 26 (2) of the Civil Procedure Act, this court has powers to award interest where non is agreed upon. (See also Crescent Transportation Co. Ltd.; vs Bin Technical Services Ltd Court of Appeal Civil Appeal no. 25 of 2000).

Interest rates on special damages should be with effect from the date of loss till payment in full while on general damages it should be from the date of judgment as it is only ascertained in the judgment. (See Hope Mukankusi vs Uganda Revenue Authority (Court of Appeal Civil Appeal no. 6 of 2011).

Having not awarded any general or special damages in the matter, this remedy is equally denied.

In relation to the costs of the suit, the general rule is that costs follow the event. (See Section 27 of the Civil Procedure Act) The Plaintiff being the successful party in the instant suít is awarded costs of the suit.

I so order.

Dated, delivered and signed at Mbarara this 29th day of May 2024.


Joóce Kavuma Judge