B.M. Technical Services Ltd v Crescent Transporters Co. Ltd [2003] UGSC 33 (22 October 2003)

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{\pntxta .}}{\*\pnseclvl4\pnlcltr\pnstart1\pnindent720\pnhang {\pntxta )}} {\*\pnseclvl5\pndec\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl6\pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl7\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl8 \pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl9\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}\pard\plain \s18\qc \li0\ri0\sb67\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs43\b\insrsid3230452\charrsid3230452 THE REPUBLIC OF UGANDA}{\cs43\b\insrsid3230452 \par }{\cs43\b\insrsid3230452\charrsid3230452 IN THE SUPREME COURT OF UGANDA }{\cs43\b\insrsid3230452 \par }{\cs43\b\insrsid3230452\charrsid3230452 AT MENGO \par }\pard\plain \s28\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par }\pard \s28\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs43\b\insrsid3230452\charrsid3230452 (CORAM; }{\cs50\b\i\insrsid3230452\charrsid3230452 ODOKI, CJ., ODER, TSEKOOKO,}{\cs50\b\i\insrsid3230452 }{ \cs50\b\i\insrsid3230452\charrsid3230452 MULENGA, KANYEIHAMBA, J. J. S. C.) \par }\pard\plain \s18\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs50\b\i\insrsid3230452 \par }\pard \s18\qc \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs50\b\insrsid3230452\charrsid3230452 CIVIL}{\cs50\b\i\insrsid3230452\charrsid3230452 }{\cs43\b\insrsid3230452\charrsid3230452 APPEAL NO. 8 OF 2002 \par }\pard \s18\qc \li0\ri0\sb5\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs43\b\insrsid3230452 \par }{\cs43\b\insrsid3230452\charrsid3230452 BETWEEN \par }\pard \s18\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs43\b\insrsid3230452 \par }{\cs43\b\lang1036\langfe1033\langnp1036\insrsid3230452\charrsid3230452 B. M. TECHNICAL SERVICES LTD. ::::::::::::: APPELLANT \par }{\cs43\b\lang1036\langfe1033\langnp1036\insrsid3230452 \par }{\cs43\b\insrsid3230452\charrsid3230452 AND \par }{\cs43\b\insrsid3230452 \par }{\cs43\b\insrsid3230452\charrsid3230452 CRESCENT TRANSPORTERS CO. LTD. ::::: RESPONDENT \par }\pard\plain \s27\qj \li734\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin734\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par }\pard \s27\qj \li0\ri0\sb14\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 [Appeal from the Judgment and decisions of the Court of Appeal at}{ \cs52\b\i\expnd2\expndtw10\insrsid3230452 }{\cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 Kampala (Kato, Okello, Mpagi-Bahigeine, }{\cs34\b\i\expnd6\expndtw30\insrsid3230452\charrsid3230452 J.}{\cs34\b\i\insrsid3230452\charrsid3230452 J.}{ \cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 A.) of }{\cs34\b\i\insrsid3230452\charrsid3230452 7}{\cs34\b\i\super\insrsid3230452\charrsid3230452 th}{\cs34\b\i\insrsid3230452\charrsid3230452 , }{ \cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 April, }{\cs34\b\i\expnd6\expndtw30\insrsid3230452\charrsid3230452 2001,}{\cs34\b\i\insrsid3230452\charrsid3230452 }{\cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 in}{ \cs52\b\i\expnd2\expndtw10\insrsid3230452 }{\cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 Civil Appeal No. }{\cs34\b\i\insrsid3230452\charrsid3230452 25 }{\cs52\b\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 of }{ \cs34\b\i\insrsid3230452\charrsid3230452 2000]. \par }\pard\plain \s26\qj \li1378\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin1378\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par \par }\pard \s26\qc \li0\ri0\sb187\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs43\b\ul\insrsid3230452\charrsid3230452 JUDGMENT OF KANYEIHAMBA, J. S. C. \par }\pard\plain \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par }\pard \s15\qj \li0\ri0\sb202\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 This is an appeal from the judgment and orders of the Court of Appeal dated 7}{\cs41\super\insrsid3230452\charrsid3230452 th }{\cs41\insrsid3230452\charrsid3230452 , April, 2001, in which the appellant's appeal against the judgment of the High Court }{\cs48\i\expnd4\expndtw20\insrsid3230452\charrsid3230452 was}{\cs48\i\expnd-6\expndtw-30\insrsid3230452\charrsid3230452 }{ \cs41\insrsid3230452\charrsid3230452 allowed with costs. \par }\pard \s15\qj \li0\ri0\sb110\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 The background to this appeal may be stated as follows: \par }\pard \s15\qj \li0\ri0\sb43\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Crescent Transportation Company Limited, the present respondent, sued B. M. Technical Services Limited, the present appellant for breach of contract of carriage of goods}{\cs41\insrsid3230452 }{\cs41\insrsid3230452\charrsid3230452 from Mo mbasa to Kampala. The contract between the appellant and the respondent was partly written and partly oral. The terms of the written part of the contract provided that the respondent was to clear the appellant's container from Mombasa and deliver it to Ka m pala. The respondent was to notify the appellant of the date of arrival of the container upon which the appellant would pay to the respondent a sum of US $4,050 to cover the freight and clearing charges. It was part of the same agreement that the appellan t would collect the container from the respondent's premises within four days of receipt of the notice of the container's arrival. In default of such collection on the part of the appellant, the appellant would pay the sum of US $150 each day that the cont a iner remained on the respondent's trailer. According to the oral part of the contract, the respondent was obliged to return the container to Mombasa within a month of delivery of the container in Kampala and in default of that return, the respondent would pay the sum of US $20 per day of detention of the trailer. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb14\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 The container was delivered in Kampala on 11.11.1998. The respondent notified the appellant of the delivery on 12.11.1998. The appellant paid to the respondent the sum of US $2,167 and promised t o pay the balance on 10.12.98. The promise was not fulfilled. However, the appellant failed to take the container from the respondent's premises. Ultimately, the respondent was forced to drop the container from the trailer at its premises on 28.5.1999. Th ereafter, the respondent filed a suit in the High Court claiming a total balance of US $35,820 as the cost of the freight charges and accumulated container detention charges. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard \s15\qj \li0\ri0\sb230\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 In its written statement of defence, the appellant admitted the contract but contended that delivery of the container had not been effected at the agreed destination which it claimed to be Mbarara and not Kampala as alleged by the respondent. When the tim e for hearing of the suit came, the appellant failed to turn up and was not represented. The court heard the case }{\cs34\i\insrsid3230452\charrsid3230452 ex parte. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb5\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 The learned trial judge awarded freight and clearing charges in the sum of US $1,883 but rejected the claim in respect of the conta iner and trailer detention. The respondent was also awarded costs and the trial judge allowed interest on the awarded amount at 4%. Dissatisfied with the judgment, the respondent appealed to the Court of Appeal challenging the refusal by the learned trial

judge to allow respondent's claim for container and trailer detention and the low rate of interest awarded. The Court of Appeal allowed the appeal and awarded an interest on the amount allowed at the rate of 22% from the date of filing the suit till payme nt of the judgment debt in full. It is against the judgment and orders of the Court of Appeal that this appeal has been filed. \par }\pard \s15\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 There are four grounds of appeal framed as follows: \par {\pntext\pard\plain\s24 \cs34\i\charrsid3230452 \hich\af0\dbch\af0\loch\f0 1.\tab}}\pard\plain \s24\qj \fi-686\li686\ri0\sb518\sl360\slmult1\widctlpar\tx686{\*\pn \pnlvlbody\ilvl0\ls1\pnrnot0\pndec\pnstart1\pnindent686 {\pntxta .}} \faauto\ls1\rin0\lin686\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs34\i\insrsid3230452\charrsid3230452 The learned Justices of Appeal erred in fact and in law when they found t hat the respondent was entitled to special damages which were not properly pleaded or proved.}{\cs34\i\expnd6\expndtw30\insrsid3230452\charrsid3230452 \par {\pntext\pard\plain\s24 \cs34\i\charrsid3230452 \hich\af0\dbch\af0\loch\f0 2.\tab}}\pard \s24\qj \fi-686\li686\ri0\sb485\sl360\slmult1\widctlpar\tx686{\*\pn \pnlvlbody\ilvl0\ls1\pnrnot0\pndec\pnstart1\pnindent686 {\pntxta .}} \faauto\ls1\rin0\lin686\itap0\pararsid3230452 {\cs34\i\insrsid3230452\charrsid3230452 The learned Justices of Appeal erred in law and in fact when they found that the respondent was entitled to damages which it could have mitigated. \par {\pntext\pard\plain\s24 \cs34\i\charrsid3230452 \hich\af0\dbch\af0\loch\f0 3.\tab}The learned Justices of Appeal erred in law when they found that an allied request constituted a contract between the parties.}{ \cs42\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 \par {\pntext\pard\plain\s24 \cs34\i\charrsid3230452 \hich\af0\dbch\af0\loch\f0 4.\tab}}{\cs34\i\insrsid3230452\charrsid3230452 The learned Justices of Appeal erred in law when they awarded an excessively high and unjustified interest rate.}{ \cs34\i\expnd6\expndtw30\insrsid3230452\charrsid3230452 \par }\pard\plain \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb24\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Dr. Byamugisha, counsel for the appellant argued the four grounds together. Counsel's submissions were of a general nature. He contended that the only amount of money supported by the evidence adduced before the learned trial judge was the sum of US $1,88 which was the balance on the costs of freight from Mombasa to Kampala. He contended that when the learned Justices of Appeal awarded further sums which they said were container storage charges and retention of trailer, they went beyond the evidence adduc ed before the trial court. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb10\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Dr. Byamugisha submitted that the Court of Appeal ought to have accepted the findings of the trial court that the respondent had failed to mitigate its loss. Counsel contended that for a considerably long period of time, the res pondent had retained both the container and the trailer without any attempts to mitigate its losses. He further contended that the respondent could easily have unloaded the container off the trailer and returned the latter to Mombasa without waiting for s o long to hear from the appellant. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb14\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Dr. Byamugisha submitted that the contract between the parties did not impose any obligation on the respondent to retain both the container and the trailer if the appellant defaulted. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard \s15\qj \li0\ri0\sb235\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Counsel contended that the Court of Appeal erred in holding that it was an implied term of the contract that the respondent was under an obligation to take reasonable care of the goods while they were in its possession. He contended that whereas such an o b ligation may arise in the case of an importer, it does not arise in the case of a clearing house. He further contended that the accumulation of storage and retention fees for seven months was unreasonable and the learned Justices of Appeal ought not to ha ve awarded unreasonable amounts of money which were contractually illegitimate. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb10\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Lastly, Dr. Byamugisha submitted that by raising the interest rate from 4% awarded by the learned trial judge to 22%, the Court of Appeal not only erred in interfering with a judge's discretion to award interest but were unreasonable to fix it at such a high rate of interest when the contract was not a commercial one but a clearing and carriage of goods contract. He argued that no interest was proved by evidence. Therefore cou nsel submitted that the award of interest at 4% by the learned trial judge should not have been interfered with. Counsel cited the Rules of this Court and }{\cs43\insrsid3230452\charrsid3230452 "McGregor on Damages" }{\cs41\insrsid3230452\charrsid3230452 in support of his submissions and on the basis of those submissions, he prayed that the appeal be allowed and the judgment of the High Court restored. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }{\cs41\insrsid3230452\charrsid3230452 Mr. Benson Tusasirwe, learned counsel for the respondent, opposed the appeal. He contended that Dr. Byamugisha had not fully argued ground one since he had not made any submissions on the issue of special damages. He confined his submissions to the rest of the grounds of appeal. Counsel contended that Annexture 'A', (exh. P1), constituted a written contract and contained the essential ingredients of the terms and conditions of the agr e ement between the appellant and the respondent. He contended that moreover those terms and conditions were admitted by the appellant in the various exchanges of communication between the parties including attempts by the appellant to pay what it owed to t h e respondent. Counsel submitted that the Court of Appeal was correct to hold that the demand of US $ 150 per day was part of that contract and constituted a foreseeable loss for each day that the appellant did not honour its obligations under the contract

after four days of being notified. The US $20 per day payable for the trailer detention was covered by the oral part of the contract. Counsel submitted that therefore the claims of US $150 and US $20 per day respectively had been improperly rejected by th e learned trial judge and for wrong reasons. Counsel finally submitted that the respondent had fulfilled its obligations under the contract while correspondingly the appellant had failed to perform its own part with consequences that were clearly predictab le to both parties. Counsel contended that it is not enough for the appellant to state that the respondent ought to have mitigated its losses without showing clearly how this could have been done. \par }{\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb14\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 I will first consider grounds 1, 2 and 3 of this appeal. I n my view, with the pleadings disclosing written and admitted terms and conditions of agreement between the parties, this appeal revolves around the execution of a clear and simple contract. The terms and conditions of the contract are clearly set out in a n agreement described as Allied Request No. B dated 15/10/1998 signed on behalf of both parties and marked as exh. P1 and in the oral agreement admitted by them. The appellant has not made any attempts to deny the existence and terms of this contract whic h by nature is a clearing and carriage of goods contract. The only bone of contention between the parties is what meaning should the court give to the contract's terms and conditions. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb115\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 In her lead judgment, Mpagi-Bahigeine, J. A. said, \par }\pard\plain \s28\qj \li734\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin734\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par \par }\pard \s28\qj \li734\ri0\sb163\sl360\slmult1\widctlpar\faauto\rin0\lin734\itap0\pararsid3230452 {\cs50\i\insrsid3230452\charrsid3230452 "The contract to ca rry the respondent's goods clearly spelt out the precise terms including the place of delivery, which was Kampala. According to the uncontroverted evidence on record, the goods arrived in Kampala on 11.10.98. The respondent was notified of their arrival t h e following day within the terms of the contract. The respondent did not take delivery. On 21.11.98, the respondent made a cheque for the sum of Shs.5,000,000/= which was dishonoured. On 30.11.98, the respondent wrote to the appellant acknowledging its in debtedness and promising to pay for the container on 10.12.98. On 15.12.98, the respondent tendered another cheque for Shs.3,900,000/= which was also dishonoured. On 6}{\cs50\i\super\insrsid3230452\charrsid3230452 th}{ \cs50\i\insrsid3230452\charrsid3230452 January, 1999, the respondent paid the appellant the equivalent of US $2,174 for cleari ng and transport. No evidence was adduced to indicate that the respondent had reminded the appellant that the agreed place of delivery was Mbarara and not Kampala. The respondent still failed to take delivery at Kampala." \par }\pard\plain \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb139\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 It is clear and I agree with the findings of the learned Justice of Appeal on this matter that from 12}{ \cs41\super\insrsid3230452\charrsid3230452 th}{\cs41\insrsid3230452\charrsid3230452 November, \par }\pard \s15\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 1998 to 6}{\cs41\super\insrsid3230452\charrsid3230452 th}{\cs41\insrsid3230452\charrsid3230452 January, 1999, the completion of the execution of the contract was in the exclusive hands of the appellant which had already accepted its terms and conditions as binding. This is evidenced by the appellant's endeavours to honour it. The respondent having waited for some four months for the appellant to fulfil its part of the bargain was eventually forced to sue. In any event, it is an implied term of a contract o f carriage of goods that the career must take reasonable care to protect the goods in its possession. In my view, there never was any period of time between notification that the container had arrived in Kampala and May, 1999, when the respondent filed its action in court, for the respondent to mitigate its losses. The admission of the contract by the appellant and its attempts to make good its part of the bargain prohibited the respondent from contemplating loss, let alone its mitigation. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard \s15\qj \li0\ri0\sb230\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 I have not found the authorities cited for the proposition that the respondent should have mitigated its losses helpful. For these reasons, grounds }{\cs41\expnd14\expndtw70\insrsid3230452\charrsid3230452 1,2,}{\cs41\insrsid3230452\charrsid3230452 and 3 of this appeal ought to fail. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb5\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 I now turn to ground 4 of the appeal. The contention in this grou nd is that the learned Justices of Appeal not only unreasonably interfered with the exercise of the learned trial judge's discretionary powers to award interest but also unjustifiably awarded excessive interest at 22%.}{\cs41\insrsid3230452 \par }{\cs41\insrsid3230452\charrsid3230452 \par }\pard \s15\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Dr. Byamugisha contended that the pro visions of s.26(2) of the Civil Procedure Act provide that interest on a judgment award is at the discretion of the Court. On this basis, counsel submitted that it was therefore an error for the Court of Appeal to interfere with the decision of the learne d trial judge who fixed the rate at 4%. He cited the cases of }{\cs43\insrsid3230452\charrsid3230452 Ecta(U) Ltd. v. Geraldine S. Namirimu & Josephine Namukasa, }{\cs41\insrsid3230452\charrsid3230452 Civil Appeal No. 29 of 1994, (S. C), (unreported), and } {\cs43\insrsid3230452\charrsid3230452 Sietco v. Noble Builders(U) Ltd. }{\cs41\insrsid3230452\charrsid3230452 (S. C), (unreported), in support of his submissions. He contended that in dollar terms, interest of 22% is too high. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb19\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Mr. Tusasirwe, learned counsel for the respondent contended that whereas it is true that the award of interest rate is at the discretion of the trial judge, there are occasions when an a ppellate court may be justified to interfere with the exercise of that discretion. In counsel's opinion, the contract was a commercial one where the normal rate of interest may be as high as 30%. In this contract, the payments were expressed in US dollars . However, it was counsel's contention that even then the rate of interest at 4% allowed by the trial judge was too low to be justified. Counsel submitted that therefore the rate of interest at 22% fixed by the learned Justices of Appeal was under the circ umstances, reasonable and this Court ought not interfere with it. Mr. Tusasirwe cited }{\cs43\insrsid3230452\charrsid3230452 Ecta(U) Ltd. v. Geraldine Namirimu & Another }{\cs52\i\insrsid3230452\charrsid3230452 (supra)}{ \cs52\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs41\insrsid3230452\charrsid3230452 in support of his submissions. \par }\pard \s15\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 In his short judgment, Mr. Okumu Wengi, Ag. J, as he then was, fixed the interest on the sum awarded at 4% per annum from the date of filing the suit till settlement without giving any reason therefor. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard \s15\qj \li0\ri0\sb235\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 This transaction was a clearing and carriage of goods contract and not an ordinary commercial transaction in which goods are normally exchanged for money or some other consideration with parties contemplating to make a profit or an interest on the business as the expected reward. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }{\cs41\insrsid3230452\charrsid3230452 The 4% interest per annum awarded by the learned trial judge does not seem to have a basis in law and the trial judge did not give reasons for it. Be that as it may, in my view, compensatory sums even though unrelated to commercial transactions should still often carry higher rate s of interest than that ordered by the learned trial judge. On the other hand, it is my view that an interest at 22% per annum in a non-commercial transaction of the nature I have described is on the high side. \par }{\insrsid3230452\charrsid3230452 \par \par }{\cs41\insrsid3230452\charrsid3230452 In my opinion, the learned Justices of Appea l were in error to label the contract in this case commercial. S.26(3) of the Civil Procedure Act may be considered as a guide in this matter. It provides that where a decree is silent as to the payment of interest, the court shall be deemed to have order ed interest at six per centum per annum. In the \par }\pard \s15\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs43\insrsid3230452\charrsid3230452 Ecta(U) Ltd. }{\cs41\insrsid3230452\charrsid3230452 case }{\cs52\i\insrsid3230452\charrsid3230452 (supra),}{ \cs52\i\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs41\insrsid3230452\charrsid3230452 this Court altered the order of the trial judge fixing the rate of interest on the decretal amount at 25% per annum to 8% because 25% was considered too high. In }{\cs43\insrsid3230452\charrsid3230452 Sietco v. Noble Builders(U) Ltd., }{ \cs41\insrsid3230452\charrsid3230452 Civil Appeal No. 31 of 1995 (S. C), (unreported), Wambuzi, CJ., as he then was, wrote the lead judgment in which he observed that, }{\cs50\i\insrsid3230452\charrsid3230452 "The court's discretion is to be exercised if sufficient cause is shown to exist," }{\cs41\insrsid3230452\charrsid3230452 and proceeded to confirm the interest rate of 12% in that case from the date of filing the suit till payment in full. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb19\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 Taking the facts and circumstances of this case and the authorities reviewed above into account, I am satisfied that the rate of interest at 22% awarded by the learned Justices of Appeal is too high. I would therefore allow ground 4 of this appeal. \par }\pard \s15\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par \par }\pard \s15\qj \li0\ri0\sb19\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs41\insrsid3230452\charrsid3230452 I would order that the decretal amount carry interest at the rate of 10% per annum from the date of filing this suit till full payment. \par }\pard\plain \s30\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\insrsid3230452\charrsid3230452 \par }\pard\plain \s15\qj \li0\ri0\sb77\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs41\insrsid3230452\charrsid3230452 In the result, this appeal ought to partially succeed. I would order that the respondent be awarded}{\cs41\insrsid3230452 3/4}{\cs33\i\expnd-4\expndtw-20\super\insrsid3230452\charrsid3230452 }{\cs33\i\insrsid3230452\charrsid3230452 }{ \cs41\insrsid3230452\charrsid3230452 of the costs in this court and in the courts below. \par }\pard\plain \s22\qj \li0\ri0\sb53\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs35\insrsid3230452 \par }\pard \s22\qc \li0\ri0\sb53\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs35\b\ul\insrsid3230452 \par }{\cs35\b\ul\insrsid3230452\charrsid3230452 JUDGMENT OF ODOKI, CJ \par }\pard\plain \s17\qj \li0\ri0\sb163\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs36\insrsid3230452\charrsid3230452 I had the benefit of reading in draft the judgment of my learned brother, Kanyeihamba JSC, and I agree with it and the orders he has proposal. \par }\pard \s17\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard \s17\qj \li0\ri0\sb19\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs36\insrsid3230452\charrsid3230452 As the other members of the Court also agree, this appeal partially succeeds. The order of the Court of Appeal awarding the appellant interest at the rate of }{\cs38\insrsid3230452\charrsid3230452 22% }{\cs36\insrsid3230452\charrsid3230452 on the decretal amount is set aside and substituted with anr order awarding interest thereof at the rate of }{\cs38\insrsid3230452\charrsid3230452 10%. }{\cs36\insrsid3230452\charrsid3230452 The appellant will have three - quarters of the costs in this Court and Courts below.}{\cs36\insrsid3230452 \par }{\cs54\ul\insrsid3230452 \par \par }\pard \s17\qc \li0\ri0\sb19\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs54\b\ul\insrsid3230452\charrsid3230452 JUDGMENT OF ODER}{\cs54\b\insrsid3230452\charrsid3230452 \par }\pard\plain \s32\qj \li0\ri0\sb178\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs49\insrsid3230452\charrsid3230452 I}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{ \cs49\insrsid3230452\charrsid3230452 have}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 had}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 the}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 benefit}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 of}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 reading}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 in}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 draft}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 the}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 judgment}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 prepared}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 by Kanyeihamba,}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 JSC.}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 I}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{ \cs49\insrsid3230452\charrsid3230452 agree}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 with}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 him}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 that}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 the}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 } {\cs49\insrsid3230452\charrsid3230452 appeal}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 should}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 partially succeed.}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 I}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 also}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 agree}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 with}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 the}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 orders}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 proposed}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 by}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 him. \par }\pard \s32\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard \s32\qj \li0\ri0\sb29\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs49\insrsid3230452\charrsid3230452 I}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 have}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 nothing}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 further}{ \cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 to}{\cs49\expnd2\expndtw10\insrsid3230452\charrsid3230452 }{\cs49\insrsid3230452\charrsid3230452 add. \par }\pard\plain \s21\qj \li0\ri0\sb67\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\cs39\ul\expnd2\expndtw10\insrsid3230452 \par }\pard \s21\qc \li0\ri0\sb67\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs39\b\ul\expnd2\expndtw10\insrsid3230452 \par \par \par }{\cs39\b\ul\expnd2\expndtw10\insrsid3230452\charrsid3230452 JUDGMENT}{\cs39\b\ul\insrsid3230452\charrsid3230452 }{\cs39\b\ul\expnd2\expndtw10\insrsid3230452\charrsid3230452 OF}{\cs39\b\ul\insrsid3230452\charrsid3230452 }{ \cs39\b\ul\expnd2\expndtw10\insrsid3230452\charrsid3230452 TSEKOOKO,}{\cs39\b\ul\insrsid3230452\charrsid3230452 }{\cs39\b\ul\expnd2\expndtw10\insrsid3230452\charrsid3230452 JSC:}{\cs39\b\insrsid3230452\charrsid3230452 \par }\pard \s21\qj \li0\ri0\sb67\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\cs44\insrsid3230452 \par }{\cs44\insrsid3230452\charrsid3230452 I have read, in draft, the judgment prepared by my learned brother, the Hon. Mr. Justice G. W. Kanyeihamba, JSC and I agree with his conclusions that the appeal should succeeds in part. I also agree with the orders he has proposes) as to costs and the rate of interest. \par }\pard \s21\qj \li0\ri0\sl360\slmult1\widctlpar\faauto\rin0\lin0\itap0\pararsid3230452 {\insrsid3230452\charrsid3230452 \par }\pard\plain \qc \li0\ri0\nowidctlpar\faauto\rin0\lin0\itap0\pararsid3230452 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\b\i\insrsid3230452\charrsid3230452 Dated at Mengo this 22 day of October 2003. \par }}