Simba Motors Ltd v John Sentongo and Anor - (HCT-00-CC-CS 733 of 2000) [2006] UGCommC 29 (20 June 2006)

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REPUBLIC OF UGANDA \par \par \hich\af36\dbch\af12\loch\f36 IN THE HIGH COURT OF UGANDA AT KAMPALA}{\b\fs28\loch\af36\hich\af36\dbch\af12\insrsid5525601 \par \hich\af36\dbch\af12\loch\f36 (COMMERCIAL COURT DIVISION) \par \par \hich\af36\dbch\af12\loch\f36 HCT-00-CC-CS-0733-2000 \par }\pard \qj \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5525601 {\b\fs28\loch\af36\hich\af36\dbch\af12\insrsid5525601 \par \par \hich\af36\dbch\af12\loch\f36 SIMBA MOTORS LIMITED ::::::::::::::::::::::::::::: PLAINTIFF \par \par }\pard \qc \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10028815 {\b\fs28\loch\af36\hich\af36\dbch\af12\insrsid5525601 \hich\af36\dbch\af12\loch\f36 VERSUS \par }\pard \qj \li0\ri0\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid5525601 {\b\fs28\loch\af36\hich\af36\dbch\af12\insrsid5525601 \par \hich\af36\dbch\af12\loch\f36 1. JOHN SENTONGO \par \hich\af36\dbch\af12\loch\f36 2. SALAMA ENTERPRISES LTD :::::\hich\af36\dbch\af12\loch\f36 ::::::::::::::: DEFENDANTS \par \par \par \hich\af36\dbch\af12\loch\f36 BEFORE: }{\b\fs28\ul\loch\af36\hich\af36\dbch\af12\insrsid5525601\charrsid10028815 \hich\af36\dbch\af12\loch\f36 THE HONOURABLE MR. JUSTICE}{\b\fs28\ul\loch\af36\hich\af36\dbch\af12\insrsid1453282\charrsid10028815 \hich\af36\dbch\af12\loch\f36 YOROKAMU BAMWINE}{\b\fs28\ul\loch\af36\hich\af36\dbch\af12\insrsid5525601\charrsid10028815 \par }{\b\fs28\ul\loch\af36\hich\af36\dbch\af12\insrsid1453282\charrsid10028815 \par \hich\af36\dbch\af12\loch\f36 J U D G M E N T: \par }{\b\fs28\loch\af36\hich\af36\dbch\af12\insrsid1453282 \par }\pard \qj \li0\ri0\sl480\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid1453282 {\loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 The plaintiff is a limited liability company registered and carrying on business in Uganda. It sued the defendants, an }{\loch\af36\hich\af36\dbch\af12\insrsid10958193 \hich\af36\dbch\af12\loch\f36 adult Ugandan}{ \loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 and }{\loch\af36\hich\af36\dbch\af12\insrsid10958193 \hich\af36\dbch\af12\loch\f36 a}{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 company}{ \loch\af36\hich\af36\dbch\af12\insrsid10958193 \hich\af36\dbch\af12\loch\f36 r\hich\af36\dbch\af12\loch\f36 espectively}{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 , for a sum of Shs.9,100,000- with interest and costs of the suit.}{\loch\af36\hich\af36\dbch\af12\insrsid1453282 \par }{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \par \hich\af36\dbch\af12\loch\f36 The following are the points of agreement in the case: \par \hich\af36\dbch\af12\loch\f36 1.\tab The defendant issued a post-dated cheque of Shs.7,000,000- to the plaintiff. \par \hich\af36\dbch\af12\loch\f36 2.\tab Shs.2,000,000- on that sum was paid. \par \hich\af36\dbch\af12\loch\f36 3.\tab \hich\af36\dbch\af12\loch\f36 The cheque was dishonoured. \par \hich\af36\dbch\af12\loch\f36 4.\tab Notice of dishonour was given. \par \hich\af36\dbch\af12\loch\f36 5.\tab The 1}{\super\loch\af36\hich\af36\dbch\af12\insrsid5522837\charrsid5522837 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 defendant borrowed some money from the plaintiff. \par \hich\af36\dbch\af12\loch\f36 From the record of the proceedings, the parties did not frame the issues for determination at the scheduling stage. The then trial \hich\af36\dbch\af12\loch\f36 judge reserved them for framing later. She le}{ \loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 f}{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 t the station before doing so. The omission did not come to light till the submissions stage. At this stage each side came up with its proposed issues for determination. From those proposals, I have derived\hich\af36\dbch\af12\loch\f36 the following issues for determination: \par \hich\af36\dbch\af12\loch\f36 1.\tab Whether the bounced cheques, one for Shs.7m and another for Shs.1.3m were }{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \tab }{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \hich\af36\dbch\af12\loch\f36 issued by the defendants,}{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \hich\af36\dbch\af12\loch\f36 and whether the invoice for Shs.800,000- was signed \tab by the defendants, or any of them.}{\loch\af36\hich\af36\dbch\af12\insrsid5522837 \par }{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \hich\af36\dbch\af12\loch\f36 2.\tab Whether the defendan\hich\af36\dbch\af12\loch\f36 t is indebted to the plaintiff in the sum claimed in the \tab plaint or at all. \par \hich\af36\dbch\af12\loch\f36 3.\tab Whether the defendants pledged a water pump to the plaintiff as security for \tab payment. \par \hich\af36\dbch\af12\loch\f36 4.\tab Remedies, if any. \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid2244951\charrsid11562228 \par }{\ul\loch\af36\hich\af36\dbch\af12\insrsid2244951\charrsid9514410 \hich\af36\dbch\af12\loch\f36 Counsel: \par }{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \hich\af36\dbch\af12\loch\f36 Mr. Kityo for the plaintiff. \par \hich\af36\dbch\af12\loch\f36 Mr. Niwagaba for the defendant\hich\af36\dbch\af12\loch\f36 s. \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid2244951\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \hich\af36\dbch\af12\loch\f36 Before I consider the evidence of the parties, let me state the law on proof in civil cases. \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid2244951\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \hich\af36\dbch\af12\loch\f36 In law a fact is said to be proved when Court is satisfied as to its truth. The general}{\loch\af36\hich\af36\dbch\af12\insrsid1665552 \hich\af36\dbch\af12\loch\f36 rule is that the burden of proof lies on the party who asserts the af\hich\af36\dbch\af12\loch\f36 firmative of the issue or question in dispute. When such party adduces evidence sufficient to raise a presumption that what he asserts is true, he is said to shift the burden of proof: that is, his allegation is presumed to be true, unless his opponent a \hich\af36\dbch\af12\loch\f36 d\hich\af36\dbch\af12\loch\f36 duces evidence to rebut the presumption. The standard of proof is on a balance of probabilities. Relating the above principle to this case, the plaintiff has alleged that the defendants are indebted to it. The burden lies on it to prove that allegation \hich\af36\dbch\af12\loch\f36 .}{\loch\af36\hich\af36\dbch\af12\insrsid2244951 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid1665552\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid1665552 \hich\af36\dbch\af12\loch\f36 At the scheduling stage, learned counsel for the plaintiff intimated to Court that although the original claim was for Shs.9,100,000-, the plaintiff had before}{ \loch\af36\hich\af36\dbch\af12\insrsid13114875 \hich\af36\dbch\af12\loch\f36 giving him instructions to recover the same received Shs.2,000,000- which fact had however not\hich\af36\dbch\af12\loch\f36 been communicated to him at the time of filing. The plaintiff accordingly stated its claim to be Shs.7,100,000-. During the pendancy of the suit, the defendant paid another Shs.3,000,000- to the plaintiff through its counsel. This }{ \loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 further }{\loch\af36\hich\af36\dbch\af12\insrsid13114875 \hich\af36\dbch\af12\loch\f36 reduced the p\hich\af36\dbch\af12\loch\f36 laintiff\hich\f36 \rquote \loch\f36 s claim further to Shs.4,100,000-, the plaintiff\hich\f36 \rquote \loch\f36 s }{\loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 current }{\loch\af36\hich\af36\dbch\af12\insrsid13114875 \hich\af36\dbch\af12\loch\f36 outstanding claim.}{\loch\af36\hich\af36\dbch\af12\insrsid1665552 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid13114875\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid13114875 \hich\af36\dbch\af12\loch\f36 There are two conflicting versions as to how the indebtedness arose. \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid13114875\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid13114875 \hich\af36\dbch\af12\loch\f36 From the plaintiff\hich\f36 \rquote \loch\f36 s point of view, according to its Managing Director PW1 Christopher Sebuliba, t\hich\af36\dbch\af12\loch\f36 he 1}{ \super\loch\af36\hich\af36\dbch\af12\insrsid13114875\charrsid13114875 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid13114875 \hich\af36\dbch\af12\loch\f36 defendant bought a house from him in 1997. The purchase price was Shs.7,700,000-. The house was in Kizungu Zone of Makindye. His attempt to take possession failed because}{\loch\af36\hich\af36\dbch\af12\insrsid14304080 \hich\af36\dbch\af12\loch\f36 of a certain lady who also claimed to have bought the same property. Upon \hich\af36\dbch\af12\loch\f36 the failure of the consideration, the 1}{\super\loch\af36\hich\af36\dbch\af12\insrsid14304080\charrsid14304080 \hich\af36\dbch\af12\loch\f36 st}{ \loch\af36\hich\af36\dbch\af12\insrsid14304080 \hich\af36\dbch\af12\loch\f36 defendant agreed to refund the purchase price. Hence the cheque}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 in the sum of Shs.7,000,000-, Shs.700,000- having been refunded to him in cash.}{\loch\af36\hich\af36\dbch\af12\insrsid13114875 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid741676\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 As to the cheque of Shs.1,300,000-, Sebuliba\hich\f36 \rquote \loch\f36 s evidence is that the \hich\af36\dbch\af12\loch\f36 1}{ \super\loch\af36\hich\af36\dbch\af12\insrsid741676\charrsid741676 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 defendant approached him again for a loan of Shs.1,300,000-. He gave it to him. That later, he approached him for further assistance and he gave him four tyres at a cost of Shs.200,000- each. Hence the genesis of the cheque in the sum of Shs.1,300,0 \hich\af36\dbch\af12\loch\f36 00- and the invoice dated 24/4/98, P. }{\loch\af36\hich\af36\dbch\af12\insrsid14683743 \hich\af36\dbch\af12\loch\f36 Exh. V.}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid741676\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 From the defendants\hich\f36 \rquote \loch\f36 point of view, as per the evidence of DW1, Sentongo, }{\loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 t}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 he}{\loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 y}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 dealt with Sebuliba as a person and not the plaintiff. About the cheque of Shs.7,000,000-, }{\loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 S}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 e}{\loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 ntongo}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \hich\af36\dbch\af12\loch\f36 says that it was not in respe\hich\af36\dbch\af12\loch\f36 ct of a sale of a house as the plaintiff alleges but a loan of Shs.5,000,000- which he got from Sebuliba. According to him, he wanted to pay some taxes on goods he had imported and the said Sebuliba gave him that money, to attract interest of Shs.2,000,0 \hich\af36\dbch\af12\loch\f36 0\hich\af36\dbch\af12\loch\f36 0-. Hence the cheque. His evidence is that the two parties made an agreement, P. Exh. 1, in the hope that if he defaulted in the payment, Sebuliba would take the house. As to the other cheque in the sum of Shs.1,300,000-, Sentongo\hich\f36 \rquote \loch\f36 s evidence is that he\hich\af36\dbch\af12\loch\f36 \hich\af36\dbch\af12\loch\f36 received Shs.1,200,000- in cash from Sebuliba and he was to pay interest on it in the sum of Shs.100,000-. Hence the cheque for Shs.1,300,000-. I have considered }{\loch\af36\hich\af36\dbch\af12\insrsid4415063 \hich\af36\dbch\af12\loch\f36 these versions. It would appear to me that as between the plaintiff\hich\f36 \rquote \loch\f36 s and the defendants\hich\f36 \rquote \loch\f36 , \hich\af36\dbch\af12\loch\f36 the defence version makes much more sense. Having said so, this Court is of the view that whether it goes}{\loch\af36\hich\af36\dbch\af12\insrsid12144951 \hich\af36\dbch\af12\loch\f36 by the plaintiff\hich\f36 \rquote \loch\f36 s version or that of the defendants, the fact remains that the parties had financial dealings which gave rise to the instant dispute\hich\af36\dbch\af12\loch\f36 . It has not been suggested, and there is no evidence to indicate so, that the plaintiff \hich\f36 \rquote \loch\f36 s cause of action is founded upon an immoral or illegal act. }{\loch\af36\hich\af36\dbch\af12\insrsid9128364 \hich\af36\dbch\af12\loch\f36 The presumption is that }{\loch\af36\hich\af36\dbch\af12\insrsid7558745 \hich\af36\dbch\af12\loch\f36 it was a moral and legal act, and therefore legally enforceable.}{\loch\af36\hich\af36\dbch\af12\insrsid741676 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid12144951\charrsid11562228 \par }{\loch\af36\hich\af36\dbch\af12\insrsid12144951 \hich\af36\dbch\af12\loch\f36 Regarding the \hich\af36\dbch\af12\loch\f36 first issue, }{\loch\af36\hich\af36\dbch\af12\insrsid4547006 \hich\af36\dbch\af12\loch\f36 both}{ \loch\af36\hich\af36\dbch\af12\insrsid12144951 \hich\af36\dbch\af12\loch\f36 cheques were payable to Simba Motors Ltd. It was not a payment to Sebuliba to raise inference that these dealings were on }{\loch\af36\hich\af36\dbch\af12\insrsid15876841 \hich\af36\dbch\af12\loch\f36 personal}{\loch\af36\hich\af36\dbch\af12\insrsid12144951 \hich\af36\dbch\af12\loch\f36 basis. This }{\loch\af36\hich\af36\dbch\af12\insrsid4547006 \hich\af36\dbch\af12\loch\f36 disposes of}{ \loch\af36\hich\af36\dbch\af12\insrsid12144951 \hich\af36\dbch\af12\loch\f36 the 1}{\super\loch\af36\hich\af36\dbch\af12\insrsid12144951\charrsid12144951 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid12144951 \hich\af36\dbch\af12\loch\f36 defendant\hich\f36 \rquote \loch\f36 s argument that he dealt with Sebuliba as an individual and not\hich\af36\dbch\af12\loch\f36 his company. The first defendant has not denied issuance of the two cheques. He has also not denied the signature on P. Exh. V,}{\loch\af36\hich\af36\dbch\af12\insrsid13507496 \hich\af36\dbch\af12\loch\f36 the invoice dated 24/4/98. The first issue is answered in the affirmative.}{\loch\af36\hich\af36\dbch\af12\insrsid12144951 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid13507496\charrsid16608696 \par }{\loch\af36\hich\af36\dbch\af12\insrsid13507496 \hich\af36\dbch\af12\loch\f36 As to whether the defendants are indebted to the\hich\af36\dbch\af12\loch\f36 plaintiff in the sum claimed in the plaint}{\loch\af36\hich\af36\dbch\af12\insrsid4332361 \hich\af36\dbch\af12\loch\f36 or at all, I have already observed that the current claim is for Shs.4,100,000-. The plaintiff\hich\f36 \rquote \loch\f36 s claim is based on the two cheques and an invoice which are not denied by the 1}{ \super\loch\af36\hich\af36\dbch\af12\insrsid4332361\charrsid4332361 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid4332361 \hich\af36\dbch\af12\loch\f36 defendant. I will start with the\hich\af36\dbch\af12\loch\f36 invoice.}{ \loch\af36\hich\af36\dbch\af12\insrsid13507496 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid4332361\charrsid16608696 \par }{\loch\af36\hich\af36\dbch\af12\insrsid4332361 \hich\af36\dbch\af12\loch\f36 It is dated 24/4/98. It is on a would have been plaintiff\hich\f36 \rquote \loch\f36 s order paper couched thus: \par }\pard \qj \li720\ri720\sl480\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin720\lin720\itap0\pararsid4486655 {\i\loch\af36\hich\af36\dbch\af12\insrsid14891500\charrsid4486655 \loch\af36\dbch\af12\hich\f36 \'93\loch\f36 To pay on the 16}{ \i\super\loch\af36\hich\af36\dbch\af12\insrsid14891500\charrsid4486655 \hich\af36\dbch\af12\loch\f36 th}{\i\loch\af36\hich\af36\dbch\af12\insrsid14891500\charrsid4486655 \hich\af36\dbch\af12\loch\f36 \hich\f36 of May Shs.800,000- (Eight hundred thousand shillings only).\'94 \par }\pard \qj \li0\ri0\sl480\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid1453282 {\fs16\loch\af36\hich\af36\dbch\af12\insrsid4547006\charrsid16608696 \par }{\loch\af36\hich\af36\dbch\af12\insrsid14891500 \hich\af36\dbch\af12\loch\f36 There is no indication thereon as to what was being transacted. The same d\hich\af36\dbch\af12\loch\f36 oes not therefore speak for itself. The plaintiff\hich\f36 \rquote \loch\f36 s case is that the first defendant was taking four}{\loch\af36\hich\af36\dbch\af12\insrsid8615779 \hich\af36\dbch\af12\loch\f36 tyres on credit. The first defendant denies it. He claims that he borrowed Shs.1,200,000- on two different occasions and that the cheque dated 15/5/98, \hich\af36\dbch\af12\loch\f36 P. Exh. IV, was a refund of that amount and the attendant interest of Shs.100,000-. I have already accepted as truthful the defence version on this issue. In addition to that acceptance, I have considered the fact that the parties did not indicate what \hich\af36\dbch\af12\loch\f36 w\hich\af36\dbch\af12\loch\f36 as being transacted. If it was a sale of tyres on credit as alleged by Sebuliba, one fails to see why the author did not state so. I note that the same is dated 24/4/98. The parties agreed that payment be on 16/5/98. Just a day before the due date, th \hich\af36\dbch\af12\loch\f36 a\hich\af36\dbch\af12\loch\f36 t is, on 15/5/98, the first defendant issued the impugned cheque, P. Exh. IV, in the sum of Shs.1,300,000-. It was in my view not merely coincidental. It is evidence that by 15/5/98, the amount due and owing from the defendants to the plaintiff on the t \hich\af36\dbch\af12\loch\f36 r\hich\af36\dbch\af12\loch\f36 ansaction of 24/4/98 was Shs.1,300,000-. The first defendant issued the impugned cheque on 15/5/98 to settle that indebtedness. The Court\hich\f36 \rquote \loch\f36 s finding on this point is that this ill-fated cheque, P. Exh. IV, constituted a payment of some additional borrowi\hich\af36\dbch\af12\loch\f36 n\hich\af36\dbch\af12\loch\f36 g from the plaintiff by the defendants. Seeking recovery of Shs.1,300,000- being the value of the bounced cheque and Shs.800,000- being the amount stated in the invoice is to claim twice in respect of the same debt. I hold so.}{ \loch\af36\hich\af36\dbch\af12\insrsid14891500 \par }{\loch\af36\hich\af36\dbch\af12\insrsid7764344 \par \hich\af36\dbch\af12\loch\f36 I now turn to the two cheq\hich\af36\dbch\af12\loch\f36 ues. Their issuance is not denied by the defence. Both parties agree that they bounced. This means in effect that the obligations of the drawers of the two cheques which were to}{\loch\af36\hich\af36\dbch\af12\insrsid8079542 \hich\af36\dbch\af12\loch\f36 settle debts owed by them to the payee, the plaintiff, not discharged. It \hich\af36\dbch\af12\loch\f36 is settled law that when a bill is dishonoured by non-payment an immediate right of recourse accrues to the holder. Accordingly, a cause of action arose in favour of the plaintiff when the cheques were dishonoured.}{ \loch\af36\hich\af36\dbch\af12\insrsid7764344 \par }{\loch\af36\hich\af36\dbch\af12\insrsid8079542 \par \hich\af36\dbch\af12\loch\f36 It is argued for the defendants that th\hich\af36\dbch\af12\loch\f36 e plaintiff not having given notice in reasonable time in accordance with S.48 of the Bills of Exchange Act committed an act that discharged the defendants from the liability on the cheque for Shs.1,300,000- against the 1}{ \super\loch\af36\hich\af36\dbch\af12\insrsid8079542\charrsid8079542 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid8079542 \hich\af36\dbch\af12\loch\f36 defendant and the cheque for Sh\hich\af36\dbch\af12\loch\f36 s.7,000,000- against the 2}{\super\loch\af36\hich\af36\dbch\af12\insrsid8079542\charrsid8079542 \hich\af36\dbch\af12\loch\f36 nd}{\loch\af36\hich\af36\dbch\af12\insrsid8079542 \hich\af36\dbch\af12\loch\f36 defendant. Counsel has placed reliance on }{ \b\ul\loch\af36\hich\af36\dbch\af12\insrsid8079542 \hich\af36\dbch\af12\loch\f36 J. B. Turyagenda \hich\f36 \endash \loch\f36 Vs- Charles Tumwesigye HCCS No. 57 of 2000 }{\loch\af36\hich\af36\dbch\af12\insrsid8079542 \hich\af36\dbch\af12\loch\f36 (unreported),}{\loch\af36\hich\af36\dbch\af12\insrsid7473840 \hich\af36\dbch\af12\loch\f36 a decision of Byamugisha J. (as she then was). In that case, Court found that the plaintiff\hich\f36 \rquote \loch\f36 s suit was time b \hich\af36\dbch\af12\loch\f36 arred for non-issuance of a notice of dishonour in time. The delay was for five months. I have addressed my mind to counsel\hich\f36 \rquote \loch\f36 s argument and the law. The Bills of Exchange Act, Cap 68, contains detailed rules relating to notice of dishonour. When a cheq\hich\af36\dbch\af12\loch\f36 u\hich\af36\dbch\af12\loch\f36 e has been dishonoured by non-payment notice of dishonour must be given}{\loch\af36\hich\af36\dbch\af12\insrsid1008428 \hich\af36\dbch\af12\loch\f36 to the drawer and each endorser, and any drawer or endorser to whom such notice is not given is discharged. Section 47 refers. The notice may be given as soon as the cheque is dishon\hich\af36\dbch\af12\loch\f36 oured and must be given within reasonable time thereafter. Section 48 (l) refers. In the absence of special circumstances, notice is not deemed to have been given within a reasonable time unless:}{\loch\af36\hich\af36\dbch\af12\insrsid8079542 \par }{\loch\af36\hich\af36\dbch\af12\insrsid1008428 \hich\af36\dbch\af12\loch\f36 (i).\tab Where the person giving and the person to receive not\hich\af36\dbch\af12\loch\f36 ice reside in the same place, the notice is given or sent off in time to reach the latter on the day after the dishonour of the bill. \par \hich\af36\dbch\af12\loch\f36 (ii).\tab Where the person giving and the person to receive notice reside in different}{\loch\af36\hich\af36\dbch\af12\insrsid16002154 \hich\af36\dbch\af12\loch\f36 places, the notice is sent off on the d \hich\af36\dbch\af12\loch\f36 ay after the dishonour of the bill, if there is a post at a convenient hour on that day, and if there is no such post on that day then by the next post thereafter.}{\loch\af36\hich\af36\dbch\af12\insrsid1008428 \par }{\loch\af36\hich\af36\dbch\af12\insrsid16002154 \par \hich\af36\dbch\af12\loch\f36 These rules have been applied rather strictly by the Courts. Thus in }{\b\ul\loch\af36\hich\af36\dbch\af12\insrsid16002154 \hich\af36\dbch\af12\loch\f36 Govind Ukeda Patel \hich\f36 \endash \loch\f36 V \hich\af36\dbch\af12\loch\f36 s- Dhanji Nanji [1960] EA 410,}{\loch\af36\hich\af36\dbch\af12\insrsid16002154 \hich\af36\dbch\af12\loch\f36 the plaintiff, a resident of Nairobi, presented a cheque, drawn on a Mombasa}{ \loch\af36\hich\af36\dbch\af12\insrsid9715631 \hich\af36\dbch\af12\loch\f36 Bank, for payment through his Nairobi bank on 13/12/1958. On 16/12/1958, his banker verbally informed him that the cheque had been dishonoured. Th\hich\af36\dbch\af12\loch\f36 \hich\f36 e plaintiff received back the cheque on 18/12/1958 marked \'93\loch\f36 \hich\f36 refer to drawer.\'94\loch\f36 On 19/12/1958 he sent the cheque to a friend in Mombasa to hand it over to an advocate for necessary action. The advocate wrote a letter on 22/12/58 informing the defendant tha\hich\af36\dbch\af12\loch\f36 t\hich\af36\dbch\af12\loch\f36 the cheque had been dishonoured which letter}{\loch\af36\hich\af36\dbch\af12\insrsid87514 \hich\af36\dbch\af12\loch\f36 he}{\loch\af36\hich\af36\dbch\af12\insrsid9780215 \hich\af36\dbch\af12\loch\f36 received on 23/12/58. On appeal from the judgment of the lower Court, the Court of Appeal held that on the evidence it was clear that notice}{\loch\af36\hich\af36\dbch\af12\insrsid1605106 \hich\af36\dbch\af12\loch\f36 of dishonour had not been given within reasonable time and the ap\hich\af36\dbch\af12\loch\f36 pellant had not given any evidence to show that he had acted with due diligence or that there were any special circumstances justifying the delay. In our situation, the law provides that delay in giving notice of }{ \loch\af36\hich\af36\dbch\af12\insrsid16539064 \hich\af36\dbch\af12\loch\f36 dishonour}{\loch\af36\hich\af36\dbch\af12\insrsid1605106 \hich\af36\dbch\af12\loch\f36 is excused where the delay is ca\hich\af36\dbch\af12\loch\f36 used by circumstances beyond the control of the party giving notice, and not imputable by his default, misconduct or negligence. S. 49 (1) thereof refers.}{\loch\af36\hich\af36\dbch\af12\insrsid16002154 \par }{\loch\af36\hich\af36\dbch\af12\insrsid1605106 \par \hich\af36\dbch\af12\loch\f36 In the instant case, the plaintiff through PW1 Sebuliba testified that it issued a notice of dishon\hich\af36\dbch\af12\loch\f36 our to the 1}{\super\loch\af36\hich\af36\dbch\af12\insrsid1605106\charrsid1605106 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid1605106 \hich\af36\dbch\af12\loch\f36 defendant on 19/3/99. The cheque of Shs.7,000,000- was dishonoured on 18/2/97. The one for Shs.1,300,000- was dishonoured on 19/5/98. This in effect means that the notice of dishonour was issued after over two years in res}{ \loch\af36\hich\af36\dbch\af12\insrsid8992821 \hich\af36\dbch\af12\loch\f36 pect of the firs\hich\af36\dbch\af12\loch\f36 t cheque and after ten months in respect of the 2}{\super\loch\af36\hich\af36\dbch\af12\insrsid8992821\charrsid8992821 \hich\af36\dbch\af12\loch\f36 nd}{\loch\af36\hich\af36\dbch\af12\insrsid8992821 \hich\af36\dbch\af12\loch\f36 cheque. No explanation has been offered for the inordinate delays. As if that was not bad enough, the suit was filed on 28/06/2000, more than 3 years after the dishonour of the first cheque.}{\loch\af36\hich\af36\dbch\af12\insrsid1605106 \par }{\loch\af36\hich\af36\dbch\af12\insrsid8992821 \par \hich\af36\dbch\af12\loch\f36 From the p\hich\af36\dbch\af12\loch\f36 leadings and the evidence of the parties, the notice was not sent on the day each cheque was dishonoured or within any reasonable time thereafter. I agree with learned counsel for the defendants\hich\f36 \rquote \loch\f36 submission that the notice was in the circumstances of thi\hich\af36\dbch\af12\loch\f36 s\hich\af36\dbch\af12\loch\f36 case not valid and effectual as the law requires. The end result is that the plaintiff\hich\f36 \rquote \loch\f36 s action is barred by law in that it cannot sue on the cheque by reason of its failure to give notice within a reasonable time. I have considered the plaintiff\hich\f36 \rquote \loch\f36 s evi\hich\af36\dbch\af12\loch\f36 d\hich\af36\dbch\af12\loch\f36 ence that after the dishonour, before the suit was filed, and even as this suit was pending determination the defendants made some payments to the plaintiff. This evidence would only have been helpful if the plaintiff\hich\f36 \rquote \loch\f36 s cause of action had been for the r\hich\af36\dbch\af12\loch\f36 e\hich\af36\dbch\af12\loch\f36 covery of the balance on the alleged transactions. It is not. The plaintiff\hich\f36 \rquote \loch\f36 s suit is pure and simple based on the dishonoured cheques. The suit is barred by time. In }{\b\ul\loch\af36\hich\af36\dbch\af12\insrsid8992821 \hich\af36\dbch\af12\loch\f36 Nanji Khodabhai \hich\f36 \endash \loch\f36 Vs- Sohan Singh [1957]}{ \b\ul\loch\af36\hich\af36\dbch\af12\insrsid10173488 \hich\af36\dbch\af12\loch\f36 EA 291}{\loch\af36\hich\af36\dbch\af12\insrsid7237495 \hich\af36\dbch\af12\loch\f36 , a cheque was dishonoured on 25/4/1955\hich\af36\dbch\af12\loch\f36 and notice of dishonour was not given until 29/4/1955. The Court held that the defendant was discharged because there were no special circumstances to justify any delay and notice should have been given on 26/4/1955. Applying the same principle to the \hich\af36\dbch\af12\loch\f36 i\hich\af36\dbch\af12\loch\f36 nstant case, no special circumstances have been pleaded or even given in evidence to justify the delays. I hold that the defendants were discharged from further liability on the cheques by reason of the inordinate and inexcusable delays. They are ipso f \hich\af36\dbch\af12\loch\f36 a\hich\af36\dbch\af12\loch\f36 cto not indebted to the plaintiff in the sum claimed in the plaint or at all. }{\loch\af36\hich\af36\dbch\af12\insrsid8992821 \par }{\loch\af36\hich\af36\dbch\af12\insrsid7237495 \par \hich\af36\dbch\af12\loch\f36 As to whether the defendants pledged a water pump to the plaintiff as security for payment, I have found the evidence in support of that claim most unsatisfactory. DW1 Sentong\hich\af36\dbch\af12\loch\f36 o claims that he took it to the plaintiff\hich\f36 \rquote \loch\f36 s offices; that he was with one Seguya. This Seguya has not appeared as a witness for either party. There was no acknowledgment of its receipt in writing. Sentongo claims that this was an over sight. I doubt t\hich\af36\dbch\af12\loch\f36 h \hich\af36\dbch\af12\loch\f36 at an important machine like a water pump said to be worth millions of shillings could merely have been dumped at the plaintiff\hich\f36 \rquote \loch\f36 s offices without anything to show for it. It is noteworthy that the defendants raised this issue after Sebuliba had demanded \hich\af36\dbch\af12\loch\f36 p\hich\af36\dbch\af12\loch\f36 ayment based on the dishonoured cheques. It appears to me that this was just an after thought; a cover up to defeat the plaintiff\hich\f36 \rquote \loch\f36 s claim. This water-pump transaction has not been}{ \loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 proved }{\loch\af36\hich\af36\dbch\af12\insrsid11210989 \hich\af36\dbch\af12\loch\f36 by }{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 the defendants on the balance of probabilities or at all. Accor\hich\af36\dbch\af12\loch\f36 dingly, the defendants\hich\f36 \rquote \loch\f36 counter claim must fail and it fails.}{\loch\af36\hich\af36\dbch\af12\insrsid7237495 \par }{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \par \par }{\loch\af36\hich\af36\dbch\af12\insrsid3674024 \hich\af36\dbch\af12\loch\f36 As regards the remedies open to the parties, the law is that where one party alleges that it paid another and the other denies receipt of the payment, the onus is on the party who alleges paym\hich\af36\dbch\af12\loch\f36 ent to prove the payment. The rationale is that it is very hard to prove a negative: }{\b\ul\loch\af36\hich\af36\dbch\af12\insrsid3674024 \hich\af36\dbch\af12\loch\f36 J. K. Patel \hich\f36 \endash \loch\f36 Vs- Spear Motors Ltd SCCA No. 4 of 1991.

\par \par }{\loch\af36\hich\af36\dbch\af12\insrsid6491780 \hich\af36\dbch\af12\loch\f36 I accept the principle in that case.}{\loch\af36\hich\af36\dbch\af12\insrsid3674024 \par }{\loch\af36\hich\af36\dbch\af12\insrsid6491780 \par \hich\af36\dbch\af12\loch\f36 In the instant case, the defendants allege that one Seguya collected Shs.400,\hich\af36\dbch\af12\loch\f36 000- on behalf of Sebuliba. Seguya did not appear as a witness nor was any acknowledgment of its receipt produced at the hearing. There is cause to doubt the alleged payment. The first defendant also claimed that Sebuliba advised him to give Shs.900,00 \hich\af36\dbch\af12\loch\f36 0\hich\af36\dbch\af12\loch\f36 - to a one Makumbi. As the defence was closing its case, the defendant purported to introduce in evidence as an exhibit a Makumbi\hich\f36 \rquote \loch\f36 s purported acknowledgment of receipt of that amount. One wonders why such a document was never produced and marked as an e\hich\af36\dbch\af12\loch\f36 x\hich\af36\dbch\af12\loch\f36 hibit at the scheduling stage if at all it was in existence by then. Court rejected it because its introduction was in contravention of the conventional rules of procedure. \par \par \hich\af36\dbch\af12\loch\f36 The plaintiff is a company. The first defendant is not an illiterate man. He is\hich\af36\dbch\af12\loch\f36 the Managing Director of the 2}{\super\loch\af36\hich\af36\dbch\af12\insrsid6491780\charrsid6491780 \hich\af36\dbch\af12\loch\f36 nd}{\loch\af36\hich\af36\dbch\af12\insrsid6491780 \hich\af36\dbch\af12\loch\f36 defendant. It is a fundamental attribute of corporate personality that a company is a legal entity distinct from its members. In these circumstances, the 1}{\super\loch\af36\hich\af36\dbch\af12\insrsid6491780\charrsid6491780 \hich\af36\dbch\af12\loch\f36 st}{\loch\af36\hich\af36\dbch\af12\insrsid6491780 \hich\af36\dbch\af12\loch\f36 defendant\hich\f36 \rquote \loch\f36 s alleged dealings with Sebuliba as if he, Sebuliba,\hich\af36\dbch\af12\loch\f36 was the company he had issued cheques to is to say the least amazing. Equally amazing is his insistence that he had no dealings with Simba Motors Ltd when the two cheques in issue were clearly in the name of that company. If he knew nothing about Simba \hich\af36\dbch\af12\loch\f36 \hich\af36\dbch\af12\loch\f36 Motors Ltd and the same had not rendered any service to him to warrant payment, why did he act as he did? I would have been of a different opinion if Sentongo was a simple village peasant and not the Managing Director of the 2}{ \super\loch\af36\hich\af36\dbch\af12\insrsid6491780\charrsid6491780 \hich\af36\dbch\af12\loch\f36 nd}{\loch\af36\hich\af36\dbch\af12\insrsid6491780 \hich\af36\dbch\af12\loch\f36 defendant. \par }{\loch\af36\hich\af36\dbch\af12\insrsid15155637 \par \hich\af36\dbch\af12\loch\f36 The burden of \hich\af36\dbch\af12\loch\f36 proving that the defendants fully settled their indebtedness to the plaintiff lay on the defendants themselves. They did not discharge that burden on the balance of probabilities or at all. Accordingly, the Court\hich\f36 \rquote \loch\f36 s finding is that the sum of Shs.3,300,0\hich\af36\dbch\af12\loch\f36 0\hich\af36\dbch\af12\loch\f36 0- would still be due and owing from the defendants. However, in view of the Court\hich\f36 \rquote \loch\f36 s finding that failure to give notice of the dishonour of the cheques within a reasonable time discharged them from further liability, I hold that the plaintiff has no enf\hich\af36\dbch\af12\loch\f36 o\hich\af36\dbch\af12\loch\f36 rceable claim against the defendants. Accordingly, the plaintiff\hich\f36 \rquote \loch\f36 s suit shall be dismissed and is hereby dismissed.}{\loch\af36\hich\af36\dbch\af12\insrsid15155637\charrsid3674024 \par }{\loch\af36\hich\af36\dbch\af12\insrsid16602747 \par }{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 As regards costs, the usual result is that the loser pays the winner\hich\f36 \rquote \loch\f36 s costs. However, this practice is subject to the Court\hich\f36 \rquote \loch\f36 s discretion\hich\af36\dbch\af12\loch\f36 such that a winning party may not necessarily be awarded his costs. For example, in }{\b\ul\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 Dering \hich\f36 \endash \loch\f36 Vs- Uris [1964] 2 All ER 660}{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 the plaintiff sued the defendant in respect of a libel. The jury, who were obviously not sympathetic to the plaintiff, awarded him c \hich\af36\dbch\af12\loch\f36 ontemptuous damages of one half penny. The trial judge did not award the plaintiff his costs, even though they probably ran into thousands of pounds. \par \hich\af36\dbch\af12\loch\f36 In light of the peculiarities of this case and the parties unconscionable conduct towards each other, I a\hich\af36\dbch\af12\loch\f36 m inclined to order that each party bears its/his own costs, save any costs that may already have been decreed to either party in any event. I order so. \par \par }{\loch\af36\hich\af36\dbch\af12\insrsid4609348 \par }{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 Yorokamu Bamwine \par }{\b\loch\af36\hich\af36\dbch\af12\insrsid4678187\charrsid4678187 \hich\af36\dbch\af12\loch\f36 J U D G E \par }{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 21/06/2006 \par \par \hich\af36\dbch\af12\loch\f36 21/6/2006 \par \hich\af36\dbch\af12\loch\f36 Mr. Gilbert }{\loch\af36\hich\af36\dbch\af12\insrsid16539064 \hich\af36\dbch\af12\loch\f36 Nuwagaba}{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 for defendants. \par \hich\af36\dbch\af12\loch\f36 Mr. Kityo for \hich\af36\dbch\af12\loch\f36 plaintiff absent. \par \hich\af36\dbch\af12\loch\f36 Parties absent. \par \par }{\b\loch\af36\hich\af36\dbch\af12\insrsid4678187\charrsid4678187 \hich\af36\dbch\af12\loch\f36 Court:}{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 Judgment delivered. \par \par \hich\af36\dbch\af12\loch\f36 Yorokamu Bamwine \par }{\b\loch\af36\hich\af36\dbch\af12\insrsid4678187\charrsid4678187 \hich\af36\dbch\af12\loch\f36 J U D G E \par }{\loch\af36\hich\af36\dbch\af12\insrsid4678187 \hich\af36\dbch\af12\loch\f36 21/6/2006}{\loch\af36\hich\af36\dbch\af12\insrsid4678187\charrsid4678187 \par }{\fs16\loch\af36\hich\af36\dbch\af12\insrsid16608696\charrsid16608696 \par }}