China Road and Bridge Corporation v Welt Machinen Engineering Limited and Others (Civil Appeal No. 13 of 2019) [2022] UGSC 2 (2 February 2022)

In 2013, the Uganda National Roads Authority (UNRA) awarded a contract to the China Road & Bridge Corporation (“appellant”) to construct the Moroto-Nakapiripirit Road. Subsequently, the appellant approached the Nakapiripirit District administration for permission to excavate building stones (granite) from Kamusalaba rock (“suit rock”) to construct the road.

On 13 May 2013, the Nakapiripirit District Local Government entered into a hire of land agreement wherein the appellant was given authority to mine stones from the suit rock. In June 2013, after the appellant had started quarrying the granite stones, the first respondent obtained a prospecting license within the same area. The first respondent also obtained location licenses from the Ministry of Energy and Mineral Development which were said to confer unto the first respondent exclusive rights to excavate granite stones from the suit rock. The first respondent subsequently sought to have the appellant terminate its excavation but was unsuccessful. 

The appellant argued that granite stone is not a mineral as provided for in the Constitution, whereas the respondents’ case was that granite stone is a mineral as provided for by the Mining Act and, therefore, required one to obtain a prospecting and location license to mine same. 

The court held that the regime relating to minerals and the mining industry is provided for under Article 244 of the Constitution, as amended. The court held that this does not mean that the Mining Act of 2003 is null and void. 

The appeal succeeded in part. The court found that granite stone is not a mineral but a stone commonly used for building purposes and that the Mining Act does not apply to substances excluded from the definition of a mineral in the Constitution. It held that the rightful entity to hold and allocate land not owned by any person is the District Land Board. It further held that Parliament may pass a law to regulate the exploitation of any substance excluded from the definition of ‘mineral’ when exploited for commercial purposes under Article 244(6) of the Constitution.