Okao v Opio (Civil Appeal 6 of 2007) [2023] UGHC 426 (22 November 2023) | Contract Of Sale | Esheria

Okao v Opio (Civil Appeal 6 of 2007) [2023] UGHC 426 (22 November 2023)

Full Case Text

## THE REPUBLIC OF UGANDA

# IN THE HIGH COURT OF UGANDA AT LIRA

## CIVIL APPEAL NO. 006 OF 2007

# (Arising from Apac Magistrate's Court Civil Suit No. 009 of 2014)

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OKAO RICHARD....................................

#### **VERSUS**

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OPIO DENIS....................................

## **BEFORE: HON. JUSTICE ALEX MACKAY AJIJI**

#### JUDGEMENT

#### **Background**

This Appeal rises out of the orders and judgment of the Chief Magistrate Court of Lira delivered on 14/3/2017 by His Worship Okumu Jude Muwone.

The Respondent filed Civil suit No. 009 of 2014 against the Appellant for special damages of Ug. Shs. 9,000,000 as monies had and received under a contract of sale of a tipper lorry Reg. No. UAK 354A, general damages for breach of contract, interest and costs. The respondent claims that he bought the said tipper lorry from the appellant for commercial purposes at 13,000,000 out of which he paid 9,000,000 and he was to pay the balance of 4,000,000 o the $14<sup>th</sup>$ of July 2014. The appellant delivered the said tipper lorry on the 15<sup>th</sup> of March 2014 to the plaintiff. The respondent claimed that upon checking the tipper lorry, he found that it was making a funny sound when started, the tipping system and stopper were not working and that the vehicle was not having a shock absorber and gear

box. He went ahead to inform the appellant, who promised to send a mechanic to work on the vehicle but in vain. The Respondent further claimed that since $17<sup>th</sup>/3/2014$ , the Appellant repossessed the tipper lorry, he has refused to work on the mechanical problems or to refund the deposit of Shs. 9,000,000

The Appellant in his written statement of defence averred that the Respondent on his own volition requested the Appellant to sell to him the said tipper lorry on "as it is" basis. The plaintiff subjected the vehicle to rigorous road test and confirmed that the same was fit for purpose and that is when he agreed to pay the purchase price. He claimed that he never repossessed the vehicle and will never reposes it since the respondent opened the gear box of the vehicle and has since left the same open.

The trial magistrate found that the Appellant was in breach of contract of sale because he delivered the vehicle to the respondent before repairing the defects on the vehicle as agreed. He therefore entered judgment in favour of the Respondent with the following orders;

- 1. The defendant breached the contract of sale of the motor vehicle - 2. The plaintiff is entitled to recover special damages of $9,000,000/$ = from the defendant as money had and received. - 3. The plaintiff is entitled to the costs of the suit.

The Appellant being dissatisfied with the judgment and orders of the trial magistrate appealed to this court on the following grounds;

- 1. That the learned trial Magistrate erred in law and fact when he failed to properly evaluate the evidence on record thus arriving at a wrong conclusion that the defendant breached the contract of sale of motor vehicle. - 2. That the learned trial Magistrate erred in law and fact when he entered judgment that the plaintiff is entitled to recover special damages of 9,000,000 and costs of the suit.

### Duty of the first Appellate Court

The obligation of the first Appellate court was explained in the case Father Nanensio Begumisa and three ors Vs Eric Tiberanga SCCA 17 of 2000; [2004] KALR 236 as follows;

"This being a first appeal, this court is under an obligation to re-hear the case by subjecting the evidence presented to the trial court to a fresh and exhaustive scrutiny and re-appraisal before coming to its own conclusion."

#### **RESOLUTION**

#### Grounds 1

The file bears no submissions for both the Appellant and the Respondent. Accordingly, I will determine the Appeal based on the pleadings and proceedings in the lower court.

#### Evidence on record

PWI testified he entered into an agreement on the 14<sup>th</sup> /3/2014 with DWI who was selling to him a tipper lorry Reg. No. UAK 354A. The purchase price was Ugshs 13.000.000, he paid Ugshs. 9.000.000 and he was to pay a balance of Ugshs. 4.000.000. The vehicle had two problems, the tipping and stopping systems that were not working. DWI went back with the vehicle saying that he would replace those parts.

On $15/3/2014$ , DWI took the vehicle to the respondent's home claiming to have already repaired it. Upon starting the engine there was bad sound coming from the vehicle and the tipping system had not been replaced. On the 16/3/2014, PWI returned the vehicle to DWI in the presence of the LCI and the LCI put it into writing but DWI refused to sign.

PWII testified that on 15/3/2014 he was called by the respondent and he gave him the vehicle to use, he started the engine and he heard some noise. He tried

to tip and he realized that the tipping system was not okay. The stopper was not working. He then told the plaintiff that such sound means that the problem is in the gear box, tipping system and the stopper. The vehicle was towed the next day to DWI's home in the presence of the LCI.

PWIII testified that there was a stopper which was supposed to be fixed by the defendant and the tipping system also had a problem. It was verbally agreed. This problem the defendant knew before selling the vehicle and the defendant accepted to rectify that problem and he went back with that vehicle that very day.

PW5, the LC5 testified that the respondent had called him to go and witness him take back the vehicle he had bought from the appellant. He further testified that he told the appellant that the respondent told him that the vehicle had a problem and had pulled it to his home. When they reached the home of the appellant, the vehicle was at his home.

He testified in cross examination that he wrote the event in his book where he recorded the name and colour of vehicle. About 4 people signed in his book namely; Opio Denis, Ongula Robert, Okwir Alex and Okello Moses. The defendant did not sign on it. He further stated that on that day they just pushed the vehicle to start engine not with the key.

The Appellant in the lower court testified that on the $7/03/2014$ he took his tipper lorry UAK 354A to Orech for repair in a place called Teso bar. He stated that while at Teso Bar, the bearing and deep system was warning and he gave it to Orech who discovered that the problem was with the bearing. Elim and the plaintiff found him at the garage. He told them to talk with the mechanic to inquire about the condition of the vehicle. They talked with the mechanic and they came back and asked the appellant for the price. They came up to where he was seated and negotiated, he told them Ugshs. 15,000,000 but they agreed for Ugshs. 13,000,000. There was a problem with the tipping cable and he informed

the respondent about it that is why he reduced it to Ugshs. 13,000,000. Apart from the tyres and tipping problem there was no other problem.

On $13/4/2014$ , the respondent called him that he should give him the vehicle to test. He gave Elim the driver of the plaintiff the vehicle to test. Elim tried and found that the vehicle was good and they entered a written agreement. After writing the agreement, the respondent gave him Ugshs. 9,000,000 claiming to give him the balance of Ugshs. 4,000,000 after 4 months. The next day he drove up to the respondent to receive his money. He took the vehicle and made the vehicle to start and all parking lights were working. After 2-3 days the respondent informed the Appellant that there are some sounds coming from the gear box and does not understand it. The Appellant told him that he is not a mechanic, he should inquire from a mechanic. In the evening the respondent towed off the vehicle and found him at the home of the LCI. The LCI told the Appellant to receive his vehicle and the Appellant told him that he had sold the vehicle to the respondent. The respondent and LCI and other community members left but the Appellant remained in the same place. He found the vehicle parked in his compound and between the gear box a bolt was removed and oil was linking down.

He further testified that because the respondent parked the vehicle all tyres are rotten. He did not close the glass screen, the rain entered and the seats are rotten, all lights removed by the children. The respondent opened the gear box, he returned the vehicle not in working condition. He stated that the respondent parked the vehicle at his home, he did not receive it because he did not know what the respondent did on the vehicle.

DWII testified that the Appellant took his vehicle to the garage to repair the deep system. He called Elim to come and check the vehicle and Elim came with his boss on $7/3/2014$ . On $7/3/2014$ , when they went, the bearing had not been fixed. It was taken in the evening and was fixed the next morning. He tested the vehicle and it was okay. On 13/3/2014, the respondent picked the vehicle and

tested it up to his home. He further testified that on the day of sale, there was no problem with the vehicle. It was not tipping because it lacked tipping cable but it could tip without tipping because there was a place you press and it would tip.

DWIII testified that he saw the respondent and his friend and it was the first day to see him. The plaintiff and defendant were saying that let the vehicle be repaired and it will be taken to him. The vehicle had a problem with the tipping cable which was spoilt. The vehicle could tip after putting off the vehicle and you pull something from under. The tyres were worn out and it was warning. The cover of the seat inside was warned and the lights were okay.

DW4 testified that on the 13/3/2014, the plaintiff picked him at Owang Centre at 6: 00pm and he told him that the vehicle had been repaired and it is in Apac Town. He went and tested from Apac town to Owang Centre and found that the vehicle was working well. It was already dark hours and the plaintiff told him that the sale would take place another date.

He testified further that after 3 days, the respondent called him and informed him that the vehicle was not good and he returned it. He did not drive this vehicle after the purchase. The respondent told him that the problem with the vehicle is too much. He was only informed of the tipping cable which had a problem.

In cross examination he testified that he checked the vehicle at 7:00 pm when it was dark. He was on the murram road, turned his ears to check on the vehicle but did not get the problem. He stated that he has some little knowledge since he has been a driver for long. He had never used the vehicle before. He could not detect what was wrong with it.

#### **Court's Analysis.**

It is not in dispute that the Appellant and the respondent executed a sale agreement PEXhI. I have looked at the agreement and it is clear that the said agreement captured the amount of money that the vehicle was sold at, the

$\mathbf{6}$ amount that the respondent paid at the time of execution and the balance which was meant to be paid later on the 14<sup>th</sup> July 2014.

Upon perusal of the record of the proceedings, the Appellant claimed that the only problem that the vehicle had was that of the tipping system because it lacked a tipping cable and there was no other problem. He further asserts that the respondent was made aware of the same before they entered the agreement. He sold the vehicle to the respondent and delivered it to his home on the $15/3/2014$ . He is therefore not responsible for the vehicle.

On the other hand, the respondent claimed that before they signed the agreement, they found two problems, the tipping system was not working neither was the stopping system working. The Appellant went with the vehicle saying he was going to replace those parts and bring back the vehicle. The Appellant returned it the next day saying he had repaired it. When the respondent started the engine, there was bad sound on the vehicle and tipping system was not replaced.

PW2 testified that when he started the engine he heard some noise, he tried to tip but could not tip, the tipping system and stopping systems were not okay. He told the respondent that such sound meant that the problem was in the gear box, tipping system and the stopper. PW2 and PW5 testified that the vehicle was towed back to the Appellant's home.

DWII testified that from the sound and smoke one can know that the engine is okay.

It is my finding that whereas the Appellant asserts that the vehicle's only problem was the tipping system with no tipping cable, however it is clear from the evidence that there were other faults with the vehicle. I find it quite hard to believe that an individual can purchase a tipper lorry meant for transportation/ commercial purposes, that does not tip. If we are to take it that the parties decided at the time of execution of the agreement on the $14/3/2014$ that the respondent would purchase the vehicle as is and use it as is, it is still

questionable that on the very day that the Appellant delivered the vehicle to the respondent, its sound was not good, thereby indicating that there were other problems with the engine.

The respondent did not use the vehicle, he returned it the very next day on the $16/3/2014$ and in returning it, he towed it.

The law on examination of goods under a contract of sale is provided for in Section 42(1) Sale of goods and supply of Services Act 2018;

"Where goods are delivered to the buyer, which he or she has not previously examined, the buyer shall not be taken to have accepted them until he or she has had a reasonable opportunity of examining them for the purpose of ascertaining whether they are in conformity with the contract."

In the circumstances of this case the vehicle was viewed at the DWII's garage before execution of the contract. The respondent testified that when he was buying, he inspected the vehicle himself. In cross examination he testified that he inspected the vehicle, he checked and found the stopper and tipping systems were not working and that DW1 told him he was going to repair.

DW4, Elim testified that on 13/3/2014, he tested the vehicle from Apac town to Owang Centre and he found that the vehicle was working well. In Cross examination he testified that he checked the vehicle at 7:00 pm when it was dark. He was on the murram road and turned his ears to check on the vehicle. He has some little knowledge since he has been a driver for long.

The trial magistrate did not find the testing done on the vehicle by DW4 enough for reasons that it was done at night, he was driving the vehicle from Apac town to Owang centre which is just 3 miles and he used his ears to hear anything wrong with the vehicle. That it was on a murram road when he could not hear anything. At worst he was not a vehicle inspector or mechanic so he cannot detect any problem

I cannot fault the trial magistrate for his finding, DW4 testified that he had some little knowledge since he had been a driver for long but he later said he had never used the vehicle before, he could not detect what was wrong with it.

On the day that the Appellant delivered the vehicle to the respondent, the Respondent checked the vehicle with PWII who is a mechanic and a driver, started the engine, he heard some noise in the engine, tried to tip the vehicle but it could not, when he tried the stopper, it was not working. The respondent did not use the vehicle for a single day and he found out the vehicle still had the problem with the tipping and stopping system on the very day it was delivered. it is clear from the evidence that when he called upon PWII and they realized that the vehicle still had a problem with the tipping and stopping systems the respondent called the Appellant and the following day he towed it back to the Appellant.

From my reading of the proceedings, I find that the vehicle had some faults like the tipping system and tyres which the respondent was made aware of. The faults with the stopper or engine were discovered at the point when the respondent called PWII to drive the vehicle after the vehicle had been delivered by the Appellant but the vehicle could not tip nor could it stop.

## According to Section 44 of the Sale of Goods and supply of services Act.

"Unless otherwise agreed, where goods are delivered to the buyer, and the buyer refuses to accept them, having the right to do so, the buyer is not bound to return them to the seller, and it is sufficient if the buyer intimates to the seller that he or she refuses to accept them."

The respondent toed the vehicle back to the Appellant's home, he invited the LCI of Ongica cell to witness him returning the vehicle to the Appellant. The Appellant refused to accept the vehicle claiming that he was not responsible for it. I find that the respondent was not bound to return the vehicle because he had rejected it having found that the vehicle could not tip neither could it stop.

The Appellant claimed that the Respondent tampered with the vehicle. He prayed that the respondent repairs the vehicle by buying new tyres, damages and expenses. The Appellant testified that when he went back in the evening, he found the vehicle parked and between the gear box a bolt had been removed and oil was licking. He further testified that the plaintiff parked it and all the tyres are rotten. He did not close the glass screen, the rain entered and seats are rotten, all the lights have been removed by the children. The plaintiff opened the gear box, he returned the vehicle not in a working condition.

In evidence DWIII testified that the tyres were worn out and it was warning. The covers of the seat inside were warned and the lights were okay.

The above issues that the Appellant pointed out were already there they were not new problems that came about as a result of the respondent parking the vehicle. The Appellant himself gave evidence that the vehicle had two problems the tipping system and the tyres. I cannot fault the trial magistrate for finding that the respondent was not responsible.

I therefore find that the Appellant was in breach of contract of sale of the motor vehicle tipper lorry Reg. no. UAK 354A

## Ground 2: That the learned trial Magistrate erred in law and fact when he entered judgment that the plaintiff is entitled to recover special damages of 9,000,000 and costs of the suit.

The principle of law in awarding special damages is well settled. A claim in special damages must be specifically pleaded and strictly proved. In the case of Gapco (u) Ltd Vs AS Transporters Ltd SCCA No. 7 of 2007, Okello JSC, cited with approval the case of Kampala City Council Vs Nakaye (1972) EA 446 where it was held;

"... the principle governing an award of special damages is clear. Special damages must be pleaded and proved....

Special damages however need not always be proved by production of documentary evidence. Cogent verbal evidence can also do"

The respondent in his plaint in the lower court averred that his claim was for recovery of his money Ugshs.9.000.000/= as money had and received. He averred that he entered an agreement of sale of a tipper lorry Reg. No. UAK 354A for commercial purposes at Ugshs. 13.000.000 out of which he paid Ugshs. 9.000.000. The respondent adduced evidence of the sale agreement marked PEXhI which clearly indicated that on the day of execution of the agreement, $14/3/2014$ , he paid a sum of Ugshs. 9.000.000.

I find that the trial magistrate was right in awarding the respondent special damages of Ugshs. 9.000.000.

In the final result, the appeal is dismissed. The decision of the lower court is upheld in favour of the respondent for orders;

- a) The Appellant breached the contract of sale of motor vehicle Reg. no. UAK 354A. - b) The respondent is entitled to recover special damages of Ugshs. $9.000.000$ /= from the Appellant as money had and received. - c) Plaintiff entitled to costs of the suit.

Dated and delivered at Lira, this $22^{\circ}$ November 2023

aron

**ALEX MACKAY AJIJI**

**JUDGE**