Zawedde v Kensington Africa Limited (High Court Civil Suit No 214 of 2012) [2017] UGCommC 253 (10 March 2017)

Full Case Text

#### **REPUBLIC OF UGANDA**

#### **IN THE HIGH COURT OF UGANDA AT KAMPALA**

#### **(COMMERCIAL DIVISION)**

## **HIGH COURT CIVIL SUIT NO 214 OF 2012**

## **<25** ZAWEDDE SANDRA

#### VERSUS

#### **KENSINGTON AFRICA LTD**

# **BEFORE HON LADY JUSTICE ELIZABETH JANE** ALIVIDZA

#### **JUDGEMENT**

IO : **'5** On 4th June 2012, the Plaintiff Zawedde Sandra sued the Defendant Company Kensington Africa Ltd in this court for rescission ofthe agreement dated 27th June 2009, refund of USD 212,000 being the purchase price for property, recovery of full compensation for delay, special damages for UGX 16,248,600, general damages for breach of contract. The pleadings indicate that the Defendant Company allegedly advertised "luxury" properties for sale and displayed samples on their website as well as physical properties for viewing. The parties entered into agreement which the Defendant company is said to have allegedly breached.

In its defence, the Defendant company, admitted that they entered into an agreement with the Plaintiff for purchase of a house No21 at Grosvembr 3D gardens comprised of Kyadondo Block 195 Plot 2133 at Kyanja on the 27th June 2009. That it used standard fittings and floor as warranted in the Show Houses and asserts that it paid the penalty for delay in full. That the Defendant complied with the specification of construction as set out in the agreement and Schedule of Document which were availed to the Plaintiff at 2-5 time.

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During scheduling, the parties, agreed on the following facts;

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- 1. That the Defendant sold one of its four bedroomed villas to the Plaintiff by agreement dated 27th June 2009. At time of sale, the property which the Defendant sold to the Plaintiff was at structural plan level and the Defendant undertook to complete the construction in accordance with the specifications of construction as set out in the $OS$ agreement and Schedule of documents and as warranted in the Show Houses and was to hand over by the end of year 2009. - 2. That the Defendant went on to construct the house, and in May, 2011, when construction was nearly complete and the house almost ready for handover, the Defendant called upon the Plaintiff for 10 inspection of the same. - 3. That the Plaintiff upon inspection communicated intention to make some interior alterations to the house to suit her personal taste, whcreupon the Defendant allowed the Plaintiff access to the house to enable her effect the said alterations. - 4. That the Plaintiff contracted independent contractors to effect the said alterations and the Defendant allowed her access to the premises from 17th June 2011 until December 2011. - 5. That on 17th January 2012, Counsel for the Plaintiff wrote to the Defendant seeking remedy for defects in the suit property, payment 20 of compensation for delay to hand over the property. That a reminder was written on 1st February 2012. - 6. That on 17th February, Counsel for the Defendant forwarded to Counsel for the Plaintiff cheques in the sum of USD 17,000 as compensation for the delay. - 7. That Counsel for the Plaintiff received the cheques with endorsement on the forwarding letter that the cheques are received as part payment without prejudice to the claims in the letter of 17th January 2012.

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- 8. That on 13th February Counsel for the Plaintiff wrote to Counsel for the Defendant acknowledging receipt of USD 17,000 and demanding for performance of the obligations set out in the 17th January 2012 letter. - 9. That Counsel for the Defendant communicated to Counsel for the <2S Plaintiff by letter dated 28th February 2012 which was received by the addressee on 2nd March 2012, that the house had been ready for a long time and requested that the Plaintiff be advised to avail herself for the handover of the same. - 10. That the Plaintiff did not avail herself.for the handover as . I<7 requested in the said letter and as at 2nd March 2012, the Defendant had not handed over the property to the Plaintiff. - 11. That the Plaintiff made written communication of rescission of the contract to the Defendant on 9th March 2012.

The parties also agreed on the following issues for determination by the court.

- 1. Whether the Defendant breached the agreement in the respects claimed by the Plaintiff; - Whether the Defendant inordinately delayed to hand over the suit property. - Whether the Defendant discharged its duty to pay compensation to the Plaintiff for delayed hand-over of the suit property. - property. • Whether the Defendant installed poor quality fittings in the suit - Whether the Defendant exhibited poor workmanship in the finishing and plumbing works of the suit property.

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- Whether the Defendant undertook to provide two parking spaces and if so whether there was a breach of the said undertaking. - 2. Whether the Defendant is guilty of misrepresentation. - 3. Whether the Plaintiff is estopped from citing delays under the tZS contract on account of access given by the Defendant to the Plaintiff upon the Plaintiffs request to make alterations to the property. - 4. Whether the Plaintiff is entitled to the remedies, sought; - Whether the Plaintiff was entitled to rescind the contract. - IO • Whether the Plaintiff is entitled to recover the purchase price. - Whether the Plaintiffis entitled to compensation as claimed, for delay to hand over the suit property. - W'hether the Plaintiff is entitled to special damages as claimed, general damages and costs of the suit.

Parties filed written witness statements so the trial was limited to cross 15 . examination of witnesses that included; the Plaintiff, Sandra Zawedde, Samuel Kiggundu, the independent building contract who inspected the building and Michael Ochwo who supervised the independent works done by the Plaintiff. For the defendant was Stephanie Kwibuka. Bidong, General Manager of the Defendant Company. At trial, the Plaintiff was represented by Counsel Lydia Nakamalira Tamale and the Defendant Company by Counsel Alex Rezida. Counsel filed written submissions supported with a wealth of authorities. I will not reproduce them but refer to the submissions where appropriate.

## **RESOLUTION OF ISSUES. xS**

From the onset, court reminds itself that the burden of proof in civil cases is on a balance of probability. **Section 101 of the Evidence Act CAP 6** provides that;

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- *(1) Whoever desires any court to give Judgment as to any legal right or liability dependent on the existence offacts which he or she asserts must prove that those facts exist.* - (2) *When a person is bound to prove the existence ofanyfact, it is said that the burden ofproof lies on that person.*

**Section 103 of the Evidence Act CAP 6** provides that *"The burden of proof as to any particular fact lies on that person who wishes the court to believe in its existence, unless it is provided by any law that proof of that fact shall lie on any particular person".* I will now go ahead to determine issues as presented by the parties.

**Issue Number One: Whether the Defendant breached the agreement in the respects claimed by the Plaintiff;**

The parties outlined the different aspects of breach of the agreement which were framed as sub issues. I will according use the same formant to resolve these particular aspects of the alleged breach of the contract by the Defendant.

The position on the law of contract which is now settled is that failure to perform a contract amounts to a breach. This gives the injured person who did not get what they bargained for a right to terminate or rescind the con.tract. **(See G. H Treifel "An outline of The Law of Contract, 1984 Edition at page 264.)**

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> I note for a fact that in this case, there was a bilateral contract with both parties purposed to perform some act. The Plaintiff had a duty to pay the consideration as agreed before completion of the flat. The Defendant promised to construct and deliver a completed house.

\* According to **Section 9 of** the **Contracts Act 2010,** a promise may be\_ expx-ess or implied. **Section 2** of the same Act interprets a promise to mean

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**"an offer that is accepted".** It is a fact which is not disputed that Che Defendant was the "promisor" who offered to construct and deliver the suit property to the "promisee" the Plaintiff who accepted the offer and paid consideration of USD 212,000/=..

Also relevant is **Section 35** of the **Contracts Act 2010** titled "Refusal of a party to perforin. It provides as follows;

**"Where a party to a contract refuses or disables himself or herself from performing a promise in its entirety, the promise may put an end to the contract unless he or she signifies by word or conduct, to its continuance".**

**Section 31 of the Contract Act 2010** imposes obligations on the parties to perform their respective promises made under the contract. Furthermore, **Section** 36 **of the Contract Act** also makes it mandatory to perform a promise once it appears from the nature of a case that this was the intention of the parties.

Therefore, undertakings and promises which are contained in a contract become express terms of the contract. I will go head to consider, the different aspects of breach as framed from the sub issues.

#### 1.1. **Whether the Defendant inordinately delayed to hand over the suit property**

The Defendant in their written submissions conceded to the fact that the "anticipated date" of completion in accordance with the agreement was end of year 2009. It is also clear from the evidence that by the end of 2009, the suit property had not been completed. It is the Plaintiffs argument thaJ Defendant company delayed for two years to hand over the hous/' Plaintiff.

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**"an offer that is accepted".** It is a fact which is hot disputed that tZhe Defendant was the "promisor" who offered to construct and deliver the suit property to the "promisee" the Plaintiff who accepted the offer and paid consideration of USD 212,000/=..

Also relevant is **Section 35** of the **Contracts Act 2010** titled "Refusal of a party to perform. It provides as follows;

*IO* **"Where a party to a contract refuses or disables himself or herself from performing a promise in its entirety, the promise may put an end to the contract unless he or she signifies by word or conduct, to its continuance".**

**Section 31 of the Contract Act 2010** imposes obligations on the parties to perform their respective promise'smade under the contract. Furthermore, **Section 36 of the Contract Act** also makes it mandatory to perform a promise once it appears from the nature of a case that this was the intention of the parties.

Therefore, undertakings and promises which are contained in a contract become express terms of the contract. I will go head to consider, the different aspects of breach as framed from the sub issues.

# **1.1. Whether the Defendant inordinately delayed to hand over the suit property**

The Defendant in their written submissions conceded to the fact that the "anticipated date" of completion in accordance with the agreement was end of year 2009. It is also clear from the evidence that by the end of 2009, the suit property had not been completed. It is the Plaintiffs argument that the Defendant company delayed for two years to hand over the house to the Plaintiff.

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The Defendant's argument was that house was completed in early 2011 and the Plaintiff was invited to inspect it. There was delay and that is why the Defendants paid the Plaintiff penalty for the delay amounting to USD 17,000. It was also an agreed fact that the Plaintiff contracted independent contractors to effect the said alterations and the Defendant allowed her access the premises from 17th June 2011 until December 2011.

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*IO* It was further agreed as a fact between the parties that Counsel for the Defendant communicated to Counsel for the Plaintiff by letter dated 28th February 2012 which was received by the addressee on 2nd March 2012, that the house had been ready for a long time and requested that the Plaintiff be advised to avail herself for the handover of the same.

Therefore it was the Defendant's contention that there was no delay and that January and February 2012 was used to make the repairs identified when the Plaintiff had access to the house and it was ready for hand over in February 2012.

Therefore, did the Defendant inordinately delay to hand over the property? Court notes that there was a delay from December 2009 to June 2011. More than 12 months delay. Is this inordinately or extremely long delay in the circumstances of the case.

Court has to consider what was contracted by the parties in relation to delays in the agreement of sale of suit property? In the particulars to the agreement, the anticipated completion date is "at the end of the year 2009".

Under 1.1. Definitions and interpretations: *"Anticipated Completion date " means the date stated in the particulars on which the Vendor undertakes to hared over the property to the Purchaser.* Likewise, *"Completion date" means the date on which the vendor has certified that the property is ready for occupation and has handed over the property to the purchaser and~the*

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*purchaser shall sign a handover document upon taking possession the property.*

It is also important to look at Clause 5.0 titled Vendor's covenants provides as follows;

*5.1. Subject to the provisions herein, the Vendorshall use its best endeavors O to procure that the completion of the house is by the anticipated completion date stated in the particulars.*

*5.2. The Vendor will use its reasonable endeavors in advance of the completion date to comply with all requirements which the Vendorreasonably expects to be made to enable an occupation permit from the Council to be* IP *granted to the property.*

**T.** It was the PW1 Sandra Zawedde, the Plaintiffs evidence that by January 2011, the house was still incomplete. That the house was still under construction. It had been roofed and part of fixtures/plumbing were done but it was not ready for occupation. That she later received communication IJ? in March 2012 that the house was ready for hand over.

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The question court seeks answered is; was the house in deliverable state by-January 2011 which was long after the anticipated delivery date?

Plaintiff in her evidence stated that after payment, she discussed with the then, defendant's General manager of her intention to modify the floor modifications since the prototypes had white ceramic titles while she wanted wooden floors especially since potential tenants preferred that but that the house was still incomplete.

The Defendant submissions was that delay before June 2011 was not contested but the issue is the delay between; June 2011 to February 2012, when the house was ready for hand over. That the Plaintiff was in

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possession of the suit property making alterations. Furthermore that during this period, the Defendant had no access to the property to complete repairs.

The Plaintiff Counsel argued that in contracts, time is of essence. Court is in. agreement that in any contract, time is of essence and a party is bound *0\*7* by their promises made in the contract especially as to stipulation of time of performance or delivery of the good. It was not a disputed fact that the Plaintiff had mortgaged the property and continues to service the loan without generating income from renting out the suit property. In this circumstances, court is convinced that time was even of more importance.

Counsel for the Plaintiff made reference to Clause 14.6 of the agreement of sale of land. It reads as follows;

14.6. *Should the delay in completion persist for more than six monthsfrom the anticipated completion Date, the Purchaser shall be entitled to rescind the contract and to a refund ofall the amounts paid by the Purchaser including* 15 ant/ *penalties accruing under clause 14.5 above.*

The anticipated completion date was end of 2009, which is 31st December. Accordingly, six months after.is 1st July 2010. From the evidence, there is no fact proved that the Plaintiff ever exercised her contractual right to rescind the contract and claim refund of the purchase price in 2010 as per righit under the contract. Infact the evidence proves that the contractual relationship between the parties continued leading her to take possession of ttie house and make the alterations she required.

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It is my opinion that Clause 14.6 was made redundant by the conduct of the parties who continued the contractual relationship of vendor and purchaser. It is also my\_opinion that since the Plaintiff was undertaking alterations in -the house, then that period of delay from June 2011 to

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**04/** December 2011 cannot be attributed to the Defendant. The suit property was handed back to the Defendant from December 2011 to end of February 2012. This is about two months and as such this delay cannot be said to be inordinately especially in light of the fact that previous delay up to May 2011 had been compensated for by the Defendant. The Plaintiff can be said 0£> in these circumstances to have accepted the compensation for the delay as opposed to rescinding the contract in 2010 or even 2011.

On record is the evidence by DW1 that the house was ready for handover immediately the Plaintiff handed back the keys for them' to rectify the defects. This was in December 2011. It is not clear why there was a further P delay of two months despite requests by Plaintiff that suit property be handed over.

Therefore my conclusion on this sub issue as to whether the Defendant inordinately delayed to hand over the suit property is that there was no proof of inordinately delay after May 2011 entitling the Plaintiff to rescind IS the contract. Though the delay of two months was long, it was not excessive in the circumstances of the whole transaction.

## **1.2. Whether the Defendant discharged its duty to pay compensation to the Plaintiff for delayed hand-over of the suit property**

Agreed facts were that; On 17th January 2012, Counsel for the Plaintiff wrote to the Defendant seeking remedy of defects in the suit property, payment of compensation for delay to hand over the property. Plaintiffs Counsel wrote a reminder on 1st February 2012. Furthermore that on 17th February 2012, Counsel for the Defendant forwarded to Counsel for the jjt. Plaintiff cheques in the sum of USD 17,000 as compensation for the delay. It was also agreed that Counsel for the Plaintiff received the cheques with

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endorsement on the forwarding letter that the cheques are received as part payment without prejudice to the claims in the letter of 17th January 2012.

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Under the contract, the parties agreed under Clause 14.5 of the agreement of sale of land that; *"Save as provided, for in this agreement, should the Vendorfail to handoverthe completed property on theAnticipated Completion 0^> Date the purchaser shall be entitled to deduct the equivalent of one percent (1 %) of the amount paid by the Purchaser as at the Anticipated Completion Date every month until completion ofthe property".*

Counsel for the Plaintiff submitted that the amount of money paid by the Defendant covered the period before May 2011. , That even by then, the house was not completed and that is why the Defendants were unable to hand it over. Therefore that the Plaintiffis entitled to full compensation.. The Plaintiff in her evidence stated that her request for compensation was not honoured until later and was only for the period up to May 2011.

Counsel for the Defendant argued that the delay after May 2011 was caused I £ by the Plaintiff and that since this was a contract of sale including construction, a two years delay should be considered in context of the fact that the Plaintiff spent six months making alteration.

I take note that after anticipated completion date, the delay was from January 2010 to May 2011. It is my opinion that the evidence points to the fact that the Defendant did not hand over the suit property to the Plaintiff as completed in May 2011. As for the period between June to December 201 1, this can be considered waivered since the Plaintiff was technically responsible for the delay.

I also take note that during the period January to February 2012, there was 2-5 furtlier delay to complete and hand over the suit property. Therefore there was a total 17 months delay that is attributed to the Defendants. Therefore

The calculations are highlight down below;

*393lUary tO Au9USt 2010 &gt; at Purchase Price °f USD 42,400 total*

*USD1lt4500ePtember 2010 t0 May 201 pUrchase price USn 161,120*

*^J^Dn4bS40^anUary Fel]riLary 2012) °4 purchase price of USD 212,000 is*

10 Therefore the total compensation rightfully due for the Plaintiff is USD 22,133. The Plaintiff has already received USD 17, 000. Therefore the outstanding balance is USD 5,133.

Therefore as regard the issue of whether the Defendant discharged its duty to pay compensation to the Plaintiff for delayed hand-over of the suit property, it is my conclusion that the Defendant did not fully discharge its duty to pay compensation to the Plaintiff. There is still an outstanding balance on the compensation of USD 5,133.

## **1.3. Whether the Defendant installed poor quality fittings in the suit property**

was In r-esolving this issue of poor quality fillings in the suit property, I will also consider the next issue of whether the Defendant exhibited poor workmanship in the finishing and plumbing works of the suit property. These two issues are interrelated. From the onset, I remind myself that the onus is on the party alleging a particular fact to prove it on a balance of probability. The Plaintiff claimed that the fittings in the suit property were of poor standard and she requested the Defendants to replace them. The Defendants on the other hand stated that the fittings were of good quality and the defeats identified by the Plaintiffwere there before the suit property "snagged". The defeats were minor and justifiably under the "defeats perl od".' Therefore as a result of this defence,'"the Defendant also has the

burden of proving that it installed good and not bad quality fittings in the suit property which were similar to the promises made under the contract of sale.

*w* From the onset I am mindful of the fact that the Plaintiff claimed that "the fittings were; "rusty sinks and loose door locks". That the quality was very poor as evidenced by the photographs taken by PW3 who was the independent experts she hired to inspect the suit property. Plaintiff evidence which is corroborated in part by her witnesses PW2 and PW3 is tie ar. However it would have been better ifthe Plaintiff had made a report showing the discrepancies between the prototype and the suit property.

PW2 Ochwo John Micheal in his evidence indicated that while they were installing the wooden floor, he observed *"very cheap andpoorqualityfittings, including toilets were fixed"* He stated that some fittings had cracks and some were even broken. During cross examination, he clarified that one toilet seat was broken and two were cracked. That two door locks were also broken

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Samuel Kiggundu in his written witness statement stated that; he noticed that the plumbing fittings did not measure up to the minimum standard of BS (British standard). That they were corroded with evidence of rust generated. The affected plumbing fittings include mixers, mixer taps for hand basins, tissue holders, soap dish, kitchen sink bottle -trap. Furthermore his inspection also revealed that the Defendant had installed very poor quality fittings and exhibited shoddy workmanship as compared - «to that of the model house which heJiad also had occasion to inspect. Part of his evidence included photographs of plumbing fittings and a door lock.

Looking at the Photographs, which to the naked and inexperienced eye of any reasonable person including the court, appear that the Fittings are of

poor quality. However the type of brand and whether fittings are of a good brand or not cannot be ascertained from the pictures.

Court also noted that in a letter dated 17th January 2012, the Plaintiffs Counsel pointed out that the plumbing fittings including shower mixers, mixer taps for hand basin, tissue holders and soap dishes, kitchen sink ^5\* . bottle trap do not measure up to the expected standards of at least BS. However I am mindful of the fact that by end of February 2012, the Plaintiff did not inspect the house to ascertain for a fact that it still had the poor quality fittings.

I am also of the opinion that the onus is now on the Defendant to prove that *1°* the fittings were of good quality. In their letter dated 28th February 2012 from the Defendants lawyers marked PIO, it was stated that *"Our clients used standard sanitary fittings and door locks as warranted in the show houses".*

i Unfortunately the Defendant did not adduce evidence to prove that the 1\$ fittings were of the same quality as warranted in the show house. I would have expected that since the Plaintiff had produced photographs that prove the poor quality fittings, then the onus was on the Defendant to prove that the fittings were of good quality. The issue here is not whether the fittings wer~e of England Brand but are similar to those fitted in the Show Houses.

Therefore it is my conclusion that the Plaintiff has not proved on a balance of probability that the Defendant installed poor quality fittings in the suit property since she never inspected the suit property before rescinding the contract. In the same vein, neither has the Defendant Company proved that on a balance of probability that they installed fittings of good quality.

## **1.4. Whether the Defendant exhibited poor workmansliip in the finishing and plumbing works of the suit property**

This court has already found in the previous issue that the Defendant installed poor quality fittings by December 2011. The position by end. of February 2012 was also not clearly ascertained. Therefore What is left to determine here is the overall quality of the finishing and plumbing works of the suit property. Was the workmanship poor, medium or excellent? Another important factor to consider is the timing. I will go ahead to reproduce some of the evidence for better analysis.

During cross examination by the Defendant, Plaintiff admitted that the Defendant reported that plumbing fixtures, wash basins, and mixers had been stolen from the house and that she agreed to replace them at her cost. Furthermore she stated that she also repainted the house at her cost. That the defendant by January 2012 had to rectify defeats from the leakage and 15 other finishing. That she spent 2,400,000 to replace the poor quality fittings. Despite this evidence which court believed, it is my opinion that since the Plaintiff never inspected the house before rescinding the contract, she was in no position to ascertain whether by end of February 2012 or even at this point in time, the suit property still has the poor quality fittings she had identified.

The Plaintiffstated that when the Defendant connected the water, there was a problem with the tank and it overflowed and caused leakages and flooded the house. Also on record is the evidence of PW2 Ochwo, who stated that the house had ceramic tile floor but it was evidently disproportional, crooked and some tiles were not firmly fixed and were shaky to step-on. That the stair case was also evidently crooked which made it difficult to install the wooden panels on uneven stairs. He explained during cross

examination that a disproportions! floor is one that is not leveled. Crooked at the landing on the stairs-not straight. That when he went to the site, he found the tiles already removed and screeding done, but some screeds had to be corrected because they were not properly done.

PW2, further told court that the wooden works also suffered interruptions from leakages from the water tank that flooded the floors on two occasions and whenever it rained, water would flow through the sliding door to the terrace on the first floor and flood the floor. He clarified during cross examination that around July 2011, when they had finished laying the tiles (timber wood), water entered and they had to redo the work. That they complained to Kensington's then General Manager, Ms Lynnete and asked her to have the door properly fixed and contain all the water leakages from the tank as it would permanently compromise the wooden parquet but no action was ever taken.

PVZ-3, Kiggundu stated.that he was a registered contractor with 20 years of \*5 experience. As regards the poor workmanship, he had this to say in his,, written statement and inspection report. I will reproduce part of evidence for emphasis.

The written statement; *"I observed that the walls in some specific sections had elements ofdampness leading to peeling offofpaintfinish, either due to ££) inadequate damp-proofing or wall tanking that was not done and/or leakage from a waterpipe embedded in the walls in the affected wall sections",*

He informed court that he also noticed the external drainage pipe from the kitcBen had a leakage and was poorly connected to the gully trap. The ceiling, particularly in the two bedrooms showed lines of timber framework *3-S* beloAv, which could have resulted either from use of unseasoned timber or- failuire 'to anchor well to the roof framework.

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In his inspection report marked P4, he outlined the said details above with additional particulars of defeats for instance that *"The Joint filling in the fixed wall tiles wasn't neatly done and type ofFiller used was lacking. Door locks aren'tfirmly fixed and ifpossible a better quality be installed".*

Counsel for the Defendant raised the fact that the defects detected by the ^9 Plaintiff fell under the defeats liability period and were part of the usual problems faced in construction.

DW1 Stepanie Kwibuka who was General Manager' at the time of the trial testified in a witness statement that *"The several defects, that is the defects on the ceiling, on the external drainage pipefrom the kitchen sink, in. thejoint fillings in the fixed wall titles, which manifested at the time when the Plaintiff's independent Contractor were modifying the. house were ordinary snags in construction/new houses; which were all corrected by the time the Defendant communicated preparedness to handover on the 28th Day of* **i <** *February 2012'* ( refer to Defence Document D4)

I will go ahead to reproduce the relevant passages from the above letter

*3. The defects on the ceiling, external drainage pipefrom the kitchen sink and in the jointfillings in the fixed wall titles were corrected. These were ordinary snags in construction/new house*

*4. The Dampness in some specific sections was a result ofa leakagefrom the tank in the ceiling. The leakage was dealt with, and the walls are dry and clean. This too was an ordinary-snag. "*

com DW1 stated that "Certification of the house" was done by Architects a pany called Symbion. That the house 121 was ready for handover as soon as the Plaintiff handed over the key. That the Plaintiff inspected the house first week ofJanuary 2012 just before she left the country. That the Plaintiff still pointed out a few snags that she reported to the office and they were attended to immediately and the house was ready for handover at this point. DW1 also told court that they have an occupation permit for house number 121. It is not clear why the Defendant did not adduce this 05 important documentary evidence.

DW1 told court that the house was ready for handover immediately after the Plaintiff handed over the keys. DW1 admitted receiving the Plaintiff's lawyer's letter of 17th January on 19th January 2012 and acknowledged it. That the house was ready by that time. The fact that the Plaintiff never inspected the house to prove that the defects had been rectified leaves the $1^{\circ}$ Defendant's evidence unchallenged.

In cross examination, PW3 confirmed the Defendant's position when he stated that "Defects liability means when I build a house for a person, usually given a period of $6$ months to put right the defects which are normally there and then hand over the house to a client. In normal cases, the house would $15$ still be in the hands of the contractor. He stated that it depended on the agreement between the parties. Either the contractor can hand over the house and remain with the liability to put right the defects or the owner can point out the defects without occupying it. That there were defects that can't be identified until the house is occupied. That it was possible to have defects in $\mathcal{L}$ a new house. That he had not encountered a scenario where the client does not occupy the completed house for the 2 months liability period and then when he/she comes in after that period detects defect. The common practice is that the owner occupies the house within the defects liability period and $\mathbf{r}$ $2S$ then gets back to the contractor on any defects."

I am also guided by Clause 5.3 of the Agreement of sale of land that provides that "The Vendor will (as between the Vendor and the Purchaser) ensure that there are remedied and out right within reasonable time any material defects in the property (other than those relating to works undertaken by the purchaser in fitting out the ....) which shall appear within a period of 6(six) 30 months from the completion date and of which notification in writing shall have been given by the Purchaser to the Vendor within the said period of 6

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(six) months and which shall be defects of such nature $\alpha$ as the Vendor $\alpha$ s contractor is obliged to remedy or put right.

My thinking is that the issue of defects liability period only came into effect after the Defendant had completed the suit property and handed it over to the Plaintiff for occupation. Clause 5.3 mentions defects after the $OS$ completion date. In this case the completion date was in February 2012 when the Defendant communicated to the Plaintiff that the house was ready for handover. Therefore, it logically follows that the defects period had not started yet. Though the Defendant's Counsel submitted ably on this, I am $\overline{10}$ not persuaded by this line of argument.

The Defendant argued that they supplied quality suit property as per the specifications of construction agreed upon in the agreement. Clause 9.0 of the agreement on variations is also relevant, it states that;

## The Vendor shall have a right;

9.1 (a) to substitute, only from the range of materials approved by the $\frac{1}{5}$ Purchaser at the time of signing the agreement, materials of the same or superior quality and it is deemed expedient by the Vendor to ensure that the construction of the property is not unduly delayed and to vary the works relating to the property in such manner as may be necessary as a result of $\mathcal{D}$ the use of such substituted materials. "

From the evidence, it is not clear what particular range of materials were agreed upon at time of signing the agreement. What is clear is that the Purchaser viewed the show/sample houses and the Defendant promised to build the suit property matching the same specifications. As pointed out by Defendant's Counsel in his submissions, the Plaintiff indicated that in 25 January 2011, she realized quality of fixtures in the sample houses was of a significant quality (England Brands) than what the Defendant was fixing in the suit property. It is my finding that after December 2011, the state of workmanship of the Suit property cannot be ascertained from the evidence. In conclusion, I find that the only physical evidence which court has to determine this issue was the photographs filed by PW3, which to the naked eye, exhibit poor workmanship however this was the position by December 2011. Furthermore, the Defendant Company in its pleadings admitted that it used standard fittings and floor as warranted in the Show Houses and complied with the specification of construction as set out in the agreement and Schedule of Document which were availed to the Plaintiff at time.

What was in the specification of construction as set out in the agreement and schedule of documents? Interestingly, the Defendant counsel never highlighted (either during the trial or in the submissions) this fact of the detailed specifications of construction. Plaintiff in cross examination stated that she never inspected the house again in February 2012 after the handover letter was received. Therefore in my opinion she would not have *'ij>* known if the defects had been fixed.

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Evidence that any defects had been rectified was not adduced. Defendant should have also adduced proof to corroborate the oral evidence of DW1. It not clear why persons with personal knowledge of the suit property were not produced. Certification by the Architects and the occupation permit granted by the Council (Authority) were mentioned by DW1 but not produced in court to support the Defendant's case that the suit propertyhad. good quality fittings and workmanship.

Therefore I find that this issue is not proved by either party. The Plaintiff has failed to prove on a balance of probabilities that the Defendant exhibited poor workmanship. There is no evidence adduced that by date of hand over of tire suit property, the quality of work was poor. -

On the other hand, the Defendant as a Vendor of the suit property had failed to prove that by end of February 2012, the suit property was of the same standard as warranted in the Show/Sample Houses and of good quality and workmanship.

## **1.5. Whether the Defendant undertook to provide two parking spaces and if so whether there was a breach of the said undertaking**

The Plaintiff contended that the Defendant at all material times represented through website adverts, the Catalogue (marked Pl b) and through the Show houses that this type of suit property had a 2 car parking space. That 1° this influenced her decision to buy the suit property. On the other hand, the Defendant company claims that it never promised two car parking slots. That there is one space within the fenced plot and another on the street besides the house.

This issue was not part of the agreement ofsale of land and thus technically ousted by Clause 12.8. Therefore there was no breach of the undertaking. Therefore I resolve this issue in the negative. Whether provision of two car parking space was a representation or misrepresentation shall be considered in the next issue.

## **Whether the Defendant is guilty Issue number two: misrepresentation.**

A representation is a statement of fact made by one party to a contract (representor) to another (representee) which while not forming a term of the contract, is yet one of the reasons that induces the representee to enter into a contract. A misrepresentation is a representation that is not true.------

I agree with both Counsel prove misrepresentation on the interpretation of the Law that the onus to is on the representee. Furthermore that a

representation means a statement of fact not a statement of intention or of opinion or law. I wish to add that if a person alters his position on the faith of a representation, the mere fact of its falsehood entitles him to certain remedies.

Representations become important especially where inducement to enter into a contract becomes crucial. Where a buyer appears to have got a raw deal then representations made by the seller become more relevant especially if there is an inference of deceit or fraud.

*\o*

**I**

Determination of this issue involves looking what was understood by both parties to be the terms of the contract. What did the Defendant company undertake to provide and what were the Plaintiff expectations based on precontractual statements and conduct of the parties. Court notes that the nature of the transaction involves construction and sale of a house. It was not a situation where there was a completed house and then the Plaintiff inspected it and brought it. Instead, the Defendant offered a concept of a master community where one can acquire a "luxury" house. Therefore did the defendant make any misrepresentations during the contract formulation process? With these principles in mind, I will go ahead to look at the evidence.

The Plaintiffs Counsel submitted that the Defendant made several statements to influence the Plaintiff into purchasing the house. That the suit property would have 2 car parking slots, fittings of the same quality and standard as those found in the show houses and high quality interior and. external finishes. But what the Defendant constructed was different from what it represented. Defendant's Counsel on the other hand stated that this was not the position as argued extensively in the first issue.

Plaintiff in her written statement told court that in December 2008 she learnt that Kensington, the Defendant was selling Signature Homes at

Lugogo ByPass and intended to construct a luxury gated community in Kyanja. Kensington had embarked on a marketing plan which reached out to Diaspora through events, their website and on-line Ugandan newspapers, specifically New Vision and Daily Monitor. That she visited the Defendant's website and looked at the various offers they had for sale and immediately contacted the property consultant who was listed on the website as the contact person to facilitate the viewing ofboth Signature and Luxury homes.

The Plaintiff told court that in December 2008, she visited the signature homes first with the property consultant and learnt that there was only one house left which was beyond her budget. That she was convinced by the 10 then Defendant's General Manager to consider purchasing one ofthe luxury properties which would be completed in September the following year (2009). That after viewing the prototypes of the luxury houses, she decided to purchase the 4 bedroomed villa which was described to have distinctive elevations, high quality interior and exterior finishes, two car park space, *]<,* generous gardens, spacious study and approximately 1.640 Square feet. That she was also given a catalogue which together with the physical viewing provided her with an expectation of a professional constructed quality house upon completion.

DW1 on the other hand told court that the Plaintiff was informed that there *££* was only one car parking space provided even for the show/sample houses. That the Defendant does not know and has never dealt with the proprietors of the website [www. Realestate-Uganda.com](http://www. Realestate-Uganda.com) from which the excerpt tendered in court was derived.

Looking at the excerpt marked Pl (a), Court notes that it is from realestate-<Uganda.com> for 4 bedroom villa. Also on record is Defendant's Catalogue with similar information. Of relevancy to this case is the page advertising the "Miami" 4 bedroom Villa. It is described as *"Distinctive elevations, High*

**r**

*quality interior and exteriorfinishes, 2 car park spaces, generous gardens, spacious study and Approx 1,640 sqft ofquality living".*

The catalogue is very interesting. It advertises footballer *"Rio Ferdinand telling people to. " come, be my neighbour in Uganda". Home owner at Kensington Luxury Heights, Kampala."*

**OS**

Guidance is given by Cheshire, Fifoot & Furmston's Law of Contract, 14th Edition at page 298 who explain that a representation does not render a contract voidable unless it was intended to cause the representee to make the contract. It must have produced a misunderstanding in his mind and that misunderstanding must have been one of the reasons which induced P him to make the contract. A false statement, whether innocent or fraudulent, does not per se give rise to a cause of action. Therefore a misrepresentation is legally harmless if the Plaintiff never knew of its existence, did not allow it to affect hisjudgment or was aware of its untruth:.

I have also aware of the fact that this was a sale by description of suit ij> property which was similar to the Show/sample houses. I wish to comment on the pre contract representations and in particular the role of advertisement in contracts. Court have held that generally advertisements are invitations to treat and not offers in a business sense (see the cases of Grainger & Sons Vs Gough (1896) A. C 325, Fisher Vs Bell (1961) 1 Q. B *394* and also Partridge Vs Crittenden (1968) 1 WLR 1208. It is my opinion that website advertising the luxury homes are invitations to treat. The website is by <realestates. Uganda.com> which the Defendant disowned. Therefore only statements that can be attributed directly to the Defendant Company made to induce a purchaser to buy their products are relevant and are accordingly examined below.

*rj*

**I**

"I will start with-the Defendant's Catalogue. It was proved to have come from the defendant company and Plaintiff testified that they gave the Catalogue

to her. It contains representations of high quality finishing and two car parking slots. These are statements of facts that this court considers material. The plaintiff in her evidence showed court that these statements and the inspection of the show/sample houses induced her to enter into the contract.

The particulars of the suit property in the agreement described the property as follows number *ofbedrooms: 4, Style: Mami. (Is this purposed to be Miami. None of the parties pointed out this error).* Court has to consider whether statements relating to luxury high quality interior and exterior finishes with 2 car parking space was a misrepresentation. The Plaintiff claimed that the *I'D* suit property was of poor quality finishing and did not have 2 car parking slot.

Court had dealt with the issue of good quality fittings and poor workmanship in great detail in the first issue. Court has already found that by December 2011, the Plaintiff proved the suit property had poor quality IS fittings and she replaced those that got missing when she had possession of the house to make alterations; The defects identified were discussed earlier in thisjudgment. This court also determined that the Defendant had failed to adduce any evidence to prove that by February 2012, the suit property was of luxury high quality interior and exterior finishes. By the end of this case, the statement of *"luxury high quality interior and exterior finishing"* has not be established as to whether it is true or false. . Since the Defendant failed to adduce this evidence, it is only with a help of a quality surveyor that this court can determine whether the suit property was of high quality and also that it is similar to the Show/Sample houses which the Plaintiffinspected and used as a basis to purchase the suit property.

The second statement is about provision of 2 car parking space. Counsel for the Plaintiff argued that there was misrepresentation. Court has to

consider whether this was a material statement that was included in the Miami style 4 bedroomed villa. The style of house is included in the particulars of suit property in the agreement. The argument that this was not included in the final contract though relevant indicates that it was false or untrue statement made. DW1 insisted that there was only 1 car parking space and the rest was street parking. Since the Plaintiff has proved that this was one of the factors that induced her to enter into the contract. Failure tojjrovide 2 car parking as represented in the Miami style 4 bedroom villa was a misrepresentation.

*o9*

*fo* Plaintiff also argued that the suit property was not the same standard as the Show/Sample houses. That she visited them and was convinced to buy a similar house. The defendant on the other hand insists that they supplied the suit property that matched the specifications in the sample houses.

I wish to point out the particulars of the suit property are described in •general rather than specific terms creating some degree of vagueness. The description of *"Style: Mami"* is vague. Does it mean Miami as described in the catalog is also not very clear. Apart from the structuralplan, description of the suit property creates more of mental picture than specific particulars wkrich any other person not party to the contract can understand.

*as* Some guidance is sought from the case of Hwan Sung Industries Ltd Vs 9-0 Ta\_jdin Hussein & 2 others SCCA 08/2008, the Supreme Court held that *" In Law, both under the Sale of Goods Act (Section 16) and Common lau>, there are legal obligations and rights that arise when a sale is by description or sample or both. Where there is a dispute as to whether the good supplied accord with the contract, the court must necessarily go into the evidence and the law to determine the liability ofanyparty. It Would be afailure on the part ofthe court ifit ignored the nature ofthe contract in dispute.*

I am also mindful of **Section 16 of the Sale of Goods Act CAP 82** which provides that "a *contract ofsale is a contractforsale by sample where there is a term in the contract, express or implies to that effect".*

**I**

*05* I have examined the agreement but:there is no mention of sample /show houses. However under **Section 16 of the Sale of Goods Act,** there is an implied condition that the goods shall be free from defects rendering them merchantable which Would not be apparent on examination of the sample.

Certainty of what was the agreed upon when parties intent to create a legal contractual relationship is also of importance. The Defendant argued that they never promised to provide two car parking space. In cross examination, 1'0 DW1 stated that by the time she joined the Defendant Company, House 121, had not yet started. The Specifications were for 4 roomed villa-4 bedrooms, living room, kitchen, dining room and bathrooms. That there was no specification in the agreement for fittings' but the plan shows that it would have bathrooms and kitchen. The agreement did not state the l'5 number of parking spaces. That an official from Defendant must have communicated that there was only one parking slot. That before signing the agreement, the Plaintiff visited the sample houses and saw all the fittings and parking slot. I have no reason to doubt this evidence.

However, Court is of the opinion that the description of the suit property to be supplied in the agreement is somehow vague. It talks of "Mami style" however, Miami style is described in the booklet with even a picture. DW1 identified this booklet as part of the sales information provided to buyers. She stated that *"... It is-issued- by Kensington. It is mainly to provide - information to buyers who wanted to buy a home with us".*

parking space. DW1 conceded that specifications for Miami at page 16 of the booklet talk about 2 car parking slots, but the Plot that the Plaintiff bought has only one Therefore, it is . my finding that there was a

**\$D0**

misrepresentation made about the 2 car parking slots that was one of the factors that induced the Plaintiff enter into this contract and the Defendants are in breach of this representation.

Therefore in conclusion to this issue as to whether the Defendant is guilty of misrepresentation. I find that; as to high quality interior and exterior $0$ finishing, the Court is unable to rule on this since there was no evidence adduced to prove the quality of the suit property as on the date of handover 28th February 2012. The quality of the Show/Sample houses was also not ascertained. Whether the suit property matches the specification of the show/sample houses was also not ascertained. The representation as to $\mathcal{O}$ quality of the suit property has not been proved by either party. However, Court finds that the Defendant is guilty of misrepresentation about the two car parking slots.

Issue Number three: Whether the Plaintiff is estopped from citing delays under the contract on account of access given by the Defendant $\leq$ to the Plaintiff upon the Plaintiff's request to make alterations to the property.

The Plaintiff's Counsel submitted that Plaintiff was not estopped from citing delays under the contract on account of access given to her by the Defendants to make alterations to the suit property. That the Plaintiff's $20$ actions did not act as waiver to the rights and remedies she is entitled to. That a wavier was not be established by express or implied terms of the contract.

On the other hand, Defendant's Clause referred the court to Clause 14.6 of the agreement of sale of land. That this amounted to an express wavier.

It reads as follows....."If the Anticipated Completion Date shall be delayed by reason of such additional works or modification of the purchaser, then the

らの

$2S$

Vendor shall not be liable for any delay in completion of the property. occasioned thereby".

With due respect to the Defendant Company, the anticipated completed date was never meet. The evidence indicates that even when they handed over the house for the alteration to be made by the Plaintiff, the Defendant $0$ \$\rightarrow\$ had not completed construction and the house was not ready for hand over.

For a better understanding of my analysis, I will reproduce the emails here below.

Email dated June 16, 2011 from Plaintiff to Lynnette (Defendant's $\mathcal{O}$ representative). It reads in part....

Dear Lynnete,

Hope this email finds you well

It has been along time since we last communicated

Am sure you have been busy and consumed

I just wanted to inform you that people will be coming to re-do the floor and $\sqrt{5}$ stair case for house 121. I presume that the time to complete the job will be three weeks. I think they start tomorrow.

Kindly render them your usual assistance

On a similar note , I will be dropping by the first week of July

I hope the house will be completed by then"

The response is an email from Lynnete to the Plaintiff dated 17th June 2011.

It reads in part....

"That is fine.

But note that we had not yet snagged the house. I will discuss with the clerk $2S$ of works on the impact and will email you. Next email is dated 18th June, this is a detailed one from the Plaintiff to Lynnete. It concerns the defects that were noticed.

Next relevant email as to completion of the construction is the one dated 28th July 2011 from Lynnete to the Plaintiff. It reads

*°5*

*K>*

### *" Hie hope you are well*

*I have fitted the showers and kitchen sink as per discussed and the mixer. Unfortunately the wooden floor guys are still very slow*

*On the paintingfinal coat Iwill arrange, all is now done except the floors The Master bedroom is tiled*

This court has already found the Defendant liable for the delay between 2010 up to June 2011. The Plaintiff was found to have contributed to the delay by six months after promising that alterations would last 2-3 week. Court has also found that the Defendants were liable for the delay after December 2011 until 28th February 2012. Therefore by taking possession of the house to make alterations that lasted half a year, the Plaintiff-is estopped from attributing this delay on the Defendant. I therefore answer this issue in the positive.

# **Issue number four: Whether the Plaintiff is entitled to the remedies sought;**

I will consider this issue in a fragmented manner given the nature of the dispute and using the same formant adopted by the Counsel submissions.

#### **-4.1. Whether the Plaintiff was entitled to rescind the contract**

**It** is a fact that the Plaintiffrescinded the contract in a letter dated 9th March 2012. The issue is whether she was entitled to do so. Plaintiffs Counsel cb!> argued that since the Defendant delayed for over two years to hand over the suit property, failed to pay full accrued compensation for delay, installed

**31**

very poor fittings, exhibited shoddy workmanship and did not provide the two car parking space that was promised, then the Plaintiff had a right to rescind the contract. On the other hand, the Defendant's Counsel submitted that the Plaintiff had no grounds to rescind the contract.

Its trite law that the remedy of repudiation of contract of sale accompanied *Oy* by rejection of the goods is available to the buyer only when the seller's breach of contract goes to the root of the. agreement.

Court has to consider the following facts and circumstances on nonperformance and partial performance. An important finding revealed in this regard is the letter dated 17th January 2012 which amounts admitted facts as to the following: by December 2010, the purchaser had paid USD 42,000, by August 2010, Purchaser had paid USD 161.. 120 and by January 2011, had paid USD 212,000. This if compared to the particulars of the agreement of sale of land which were as follows. USD 10,600 by April 2009, USD 31,800 by June 30, 2009 and USD 169,600 by August 2009. It is clear by /5 anticipated completion date by end of 2009, the Plaintiff not fulfilled her promise to pay the full amount of USD 212,000.

I am of the opinion that the Plaintiff had opportunity to rescind the agreement in 2011, but instead took possession of the suit property and made alterations to it and in process caused further delays. I have *fa* discussed this issue at length. Court also found that the Plaintiff never ascertained whether the defects identified had been fixed before rescinding the contract.

I take note that duringthe making of alteration is when defects.were-noticed and pointed out. Within two months, the defendant claims that defects were sorted out, however there was no evidence produced to prove this as an established fact.

**32**

Events leading to rescission are not clear. The Plaintiff spent considerable resources of her own to prepare the house especially since as she pointed out she had even got tenants. I would have expected her to go and inspect the house and if it did not match the specifications of the sample/show houses, then there would be reason to repudiate the contract.

Therefore for all the above reasons, I find that in the absence of proof on a balance of probability of poor quality suit property, the Plaintiff was not entitled to rescind the contract.

### 4.2. Whether the Plaintiff is entitled to recover the purchase price

This case presents a practical problem and highlight how sometimesjustice *lC>* and the black letter law coincide. The plaintiff paid money for the suit property. The suit property is already built. The issue is about whether she is entitled to recover the purchase price. The problem was about defects and. since Defendant has already constructed the house, recovery of purchase price may not be sustainable in the circumstances.

If tlie defendant promised to supply a house that meets the standards of the Show/Sample houses and failed to deliver, then the Plaintiff would be entitled to reject the suit property. However it has not be proved that the house does not meet the specifications set out.

Section 63 of the Contracts Act 2010, provides that "A *party who rightfully rescinds a contract is entitled to compensation for any damages which that person sustains through the non-fulfillment of the contract."*

From the correspondence between the parties, the Defendant was informed of the defeats in the property. At the end of the day, the Plaintiff was entitled to the suit property being ofthe same'standard as-the sample/show houses." This are crucial words in this whole contractual relation of sale of the suit

**...**

**33**

**c**

fulfilled their promises under the *0\$* property. The agreement was made before the suit'property was completed. Therefore it was the Defendant making promises ofwhat the Plaintiff should expect. There was no vagueness in this. If the Defendant company did not hand over the suit property similar to the sample/show houses they displayed for inspection, then they never contract.

Therefore I conclude that the Plaintiff is entitled to recover the purchase price if the suit property does not meet the specification of the show/sample houses. Therefore an expert be commissioned to inspect the suit property and compare it with the specifications from the sample/show houses. If the /'O suit property is of inferior standards then the Plaintiff is entitled to recover the purchase price from the Defendant.

## **4.3. Whether the Plaintiff is entitled to compensation as claimed, for delay to hand over the suit property**

Plaintiff admitted that delay was compensated. Court found that the *\C?* subsequent delay was to complete Plaintiffs alterations. Court noted that from the email exchanges between the parties, it also took a very long time for the Defendant to pay compensation. This court has already found that the total compensation rightfully due for the Plaintiff is USD 22,133. The Plaintiff has already received USD 17, 000. Therefore the outstanding *Q>0* balance is USD 5,133. Therefore the Plaintiffis entitled to this amount USD 5,133 with interest at commercial rate of 28% per annum from March 2012 until payment in full.

4.4. **Whether the Plaintiff is ...entitled to special damages as claimed, general damages and costs of the suit.**

**I** am mindful of the principle that special damages should be specifically proved. See the cases of **Estate of Shamji. Visram Kurji Karsan Vs**

**34**

*<* **/'**

**r.,**

Shauresad Magaulal Bhatt & another (1965) E. A 789 and Emunyat Vs Attorney General HCCS 24, 2002 among others. It's a general rule oflaw that special damages must be specifically pleaded and proved. Therefore, the Plaintiff can only be granted special damages where she has proved them satisfactorily.

*OS*

Did the Plaintiff prove any special damages. The Plaintiff stated that she spent total of UGX 2,400,000 for replacing poor fittings. There is evidence of receipts as part of the exhibited documents. This was not disputed by the Defendant. However there was evidence that some of the fittings went *I* missing when she was in control of the suit property. However court will *\O* award her these costs of UGX 2,400which were to replace poor quality fittings.

As regards general damages, the principle is that these damages are those that are a result or probable consequences of the act complained about. Section 61 fl) of the Contracts Act 2010 provides that "a *party who suffers breach of contract is entitled to receive from the partyr who breached the contract compensationsfor any loss or damage caused by him/her".*

Section 61 (4) of the Contracts Act provides that "in *estimating the loss or damage arising from the breach of contract, the means of /S) remedying the inconvenience caused by the non-performance of the contract, which exists, shall be taken into account".*

Guidance is sort from earlier decisions ie; Kamugira Vs National Housing and Construction Corporation HCCS No 127/2008, .where it was held that "in *deciding the quality of damages, courts should consider the value ofthe subject matter, the economic inconvenience that theparty tvccs pilt through at the instance ofthe opposite party and the nature anti extent ofthe breach".*

**35**

**50f**

The rationale for general damages is to put the injured in the same position they would have been in, if the injury did not take place. Courts also ta\_ke into consideration inflation levels, change in the value of the currency among other factors. In the circumstances of this case, assessment of damages is hard to achieve. The evidence indicates that the Plaintiff obtained a mortgage to finance this project. The suit property isalready in her names. The Defendants company constructed the suit property and finally were ready to hand it over in 2012.

I take note that the letters from the Plaintiffshow intention to continue with the contract even up to 13th February 2012 and with warning that they will I'D seek legal redress. The laidback attitude and conduct of the Defendant within 2 months from December to Feb/March 2012 was unexplained. It was not clear why during the time when the alterations were made, defects were not remedied and property handed over to the Plaintiff. There was laxity on the part of the Defendant, therefore I give general damages of ten million shillings which is even more of exemplary damages given the fact that the Defendant conduct was negligent as to time of performance.

On issue of misrepresentation as to 2 car parking space. The Plaintiff is entitled to general damages for the failure to provide the 2 car parking space. Court finds that a suitable amount as damages is based on the purchase price of USD 212,000. I find that the Defendant company should refund the Plaintiff USD 15,000 for making false representations that contributed to inducing the Plaintiff to buy the suit property.

I also take note that the completion date was purposed to be accompanied . . by an occupation permit by Council. The defects pointed out may have been rectified but there is no proof of this from the Defendant's evidence. The issue for court to determine is whether the suit property in its current state is the same house contracted for. If this is so, then the buyer should not

be entitled to a refund since she contributed to the delay. However Plaintiff informed court that she never inspected the house after she got the letter handing it over. This is one of those cases where justice has to be done to both parties to this agreement. I note that the property in the goods has already passed. The house is complete. The Plaintiff already got a mortgage #5 to finance buying ofthe house. The house has been unoccupied since 2012. Unfortunately the Defendant did not provide court with the status of the house. All these above issues have to be considered by the court in order to arrive at a fair and just orders.

**£** Therefore court orders the appointment of a joint expert to file a report of I# the status of the house and whether it confirms to the description agreed upon by the parties including the sample/show houses. However the fact that defects were substantial and this was the cause of non-performance cannot be ignored. Therefore the expert's report will provide the answers the court was unable to get from the adduced evidence.

*yo* In conclusion I am mindful of the fact that it is not the role of courts to make contracts for the parties or dictate the terms. Court is also mindful of the big picture where courts are entrusted with the responsibility of promoting commerce and protection of rights of consumers as well as maintaining the integrity of the specific industry. In the absence of regulatory provisions that ensure such sales ofsuit properties as advertised are delivered, then Courts have to fill this gap.

*&* However in this case, the suit property already exists. Money has been spent by both parties to complete this legal contractual relationship. Furthermore, the defendant has delivered the suit property but has failed to prove that it meets the agreed standard of the sample/show houses or is even of high quality as promised.- However, I am mindful of the key fact-thatwhen the Plaintiff rescinded the contract, she had not gone to inspect the property

**37**

**I**

- and~ensure that suit property finally did -not conform to specifications of the show house standards or even that defeats pointed out had not been fixed. So in the interests of justice, I wish to give the Defendant company opportunity to deliver on the promise that the suit property does meet tire agreed standards and specifications in the contract and sample/show houses.

Therefore, in conclusion, I make the following orders

**I. /**

**I**

- 1. An independent expert agreed upon by the parties be commissioned and paid by both parties to ascertain the current value of the Property. If it is below the paid purchase price of USD 212,000, then the Defendant will reimburse the Plaintiff the difference. - 2. Notwithstanding the above order, the Plaintiff is still entitled to suit property that was promised as per the standard/show/sample houses. The independent expert should inspect the suit property premises and ensure that it conforms to the promises made in the contract. If not, then the Defendant should refund the full purchase price with interest of 20% per Annum from the date of the contract until payment in full. - 3. Compensation for the delay to hand over completed suit property of USD 5,133. Interest be paid on this at the rate of 28% per annum from 2012 until payment in full. - 4. General Damages of UGX 10,000,000 for unnecessary delay to handover the suit property at rate of 28% per annum from 2012 until payment in full. - 5 ~ Courf found the Defendant company guilty of misrepresentations 2\$ concerning the parking space. Therefore Damages to be paid for misrepresentation of the parking capacity from two car to one car of

**38 ■-**

Payable at a rate of interest of 10% per annum from date contract until payment in full. USD 15,000. of the

**r**

Costs of this litigation incurred by the Plaintiff in this litigation be paid by the Defendant company. 6.

So ordered

**Elizabeth Jane Alividza**

**Judge**

**Commercial court** *IV*

**10\*h March, 2017**

**10th March 2017**

Counsel for Plaintiff in court

Counsel for Defendant absent

**/J** Court Clerk Kirabo Mabel present.

**Court:** Judgment read in open court. Right of Appeal explained.

**Elizabeth Jane Alividza**

**Judge**

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**j? n**