Last Updated: 25 May 2007
Quality Parts Co. Ltd V.Grace Busaasi t/a Grace Simple Stores- HCT-00-CC-CS-0491-2006  UGCommC 11 (5 February 2007)
THE REPUBLIC OF UGANDA
IN THE HIGH COURT OF UGANDA AT KAMPALA
(COMMERCIAL COURT DIVISION)
Quality Parts Co. Ltd.................................................................. . Plaintiff
T/A Grace Simple Stores........................................................ Defendant
5th February 2007
BEFORE: THE HONOURABLE MR. JUSTICE YOROKAMU BAMWINE
J U D G M E N T:
The plaintiff’s claim is for recovery of the price of goods supplied to the defendant and costs of the suit. It was brought under 0.36 r. 2 (a) (i) of the Civil Procedure Rules. In the course of time, the defendant applied for leave to appear and defend which was granted. At the scheduling conference, the parties agreed that:
1. The defendant purchased TDR Force batteries from the plaintiff at a cost of Shs.42,906,000-.
2. Part payment of Shs.20,000,000- was effected leaving balance of Shs.22,906,000-.
3. Three cheques were issued by the defendant.
4. During the pendency of the suit, the defendant made another payment of Shs.2,906,000-.
The issues are:
1. Whether the defendant is indebted to the plaintiff in the sum of Shs.20,000,000-.
2. Whether the defendant’s counter claim against the plaintiff is valid.
3. Remedies, if any.
As to whether the defendant is indebted to the plaintiff in the sum of Shs.20m, it is an admitted fact that the defendant purchased "TDR Force" Batteries from the plaintiff. Both parties agree that it was 1018 cartons and 8 packets. In the ordinary language, TDR Force Batteries are dry cells. The sale took place in May 2005. The purchase price was Shs.42,906,000-. It is also an admitted fact that some part payment in the sum of Shs.20,000,000- was effected at the time of the sale and Shs.2,906,000- during the pendency of the suit. From the admitted facts, therefore, out of the purchase price of Shs.42,906,000-, Shs.22,906,000- has been paid leaving a balance of Shs.20,000,000-. Thus the supply of the goods is not in dispute and so is the outstanding balance of Shs.20,000,000-. The issue is whether the plaintiff is entitled to the payment.
The defendant has offered some explanation as to why she did not pay the balance. According to her, the batteries sold to her turned out to be sub-standard, were not of merchantable quality and not fit for the purpose. She claims further that as a result of the aforesaid, there was a general out-cry from their customers who made a report to police which police raided her shop and impounded cartons of batteries now said to be in custody at CID Headquarters. Her evidence is that the police contacted Uganda National Bureau of Standards to have the impounded batteries tested and the result was that they did not meet the required standards for end point voltage and they were leaking. She claims that as a result of having been sold defective products, she has suffered loss. Hence her counter claim that even the Shs.20m she had paid be refunded to her. The plaintiff disputes all this.
I have very carefully addressed my mind to the able arguments of both counsel. According to our law of evidence, a fact is said to be proved when the Court is satisfied as to its truth, and the evidence by which that result is produced is called the proof. The general rule is that the burden of proof lies on the party, who asserts the affirmative of the issue or question in dispute. When that 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 adduces evidence to rebut the presumption. It goes without saying that the burden of proof in this case lay on the plaintiff to show that this was a sale transaction in which it was entitled to the purchase price.
According to the defendant, she is a business woman based in Kikubo, Kampala. One day, the plaintiff’s Managing Director one Martin went to her shop. He was looking for business, someone to buy TDR Force Batteries. He brought 1018 Cartons and some loose packets. In her own words, she bought the batteries but she did not pay cash. She paid Shs.20m out of Shs.42,906,000- and for the balance she gave him three blank cheques. She just signed the cheques, she did not insert names.From the defendant’s evidence, the goods were specific, ascertained, in a deliverable state and for a stated price.
Section 19 of the Sale of Goods Act provides as follows:
"19. Unless a different intention appears, the following are rules for ascertaining the intention of the parties as to the time at which the property in the goods is to pass to the buyer –
(a) where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment or the time of delivery or both are postponed."
This Court is bound to construe the agreements of the parties as they are made. It is trite that the Courts will not make contracts for the parties but give effect to their clear intentions. Learned counsel for the plaintiff has submitted that the property in the goods passed to the defendant in May 2005 though the time of payment of the balance was postponed. From the evidence of the parties, I agree with that submission. The defendant has not pleaded or given any reason that the goods were not in the same state as when she saw them on inspection. It is common knowledge that batteries have a limited life span. With time, they expire and leak. There is no evidence that she even bothered to find out about the expiry date. Since she inspected them before taking them on, the presumption is that she was satisfied with the condition in which they were, that is of merchantable quality. In all these circumstances, Court is satisfied that the title in the goods passed to the defendant when the contract was made.
It has been submitted for the defendant that a total of 450 cartons were taken by the police. There is no any documentary evidence or report from the police that this was so. All there is a document indicating that one box was taken to Uganda National Bureau of Standards by police on 26/9/2005. The document does not show that this was part of the goods impounded from the defendant’s premises to raise the inference that it was part of the consignment she had purchased from the plaintiff. The police who allegedly impounded the goods did not appear as witnesses in this case. Therefore, it is any one’s guess as to where the police got this one box from. There is no evidence that the defendant was the sole seller of TDR Force Batteries in Kampala at the time.
The defendant also contended that there was an outcry from customers who made a report to police. No such customer appeared as a witness herein. And as I have already said, although it is claimed that police raided her shop and impounded cartons of batteries which are in custody at CID Headquarters, there was no confirmation of this story by the police themselves or the reason for the impounding. The defence evidence is also that the police contacted UNBS to have the impounded batteries tested and that the result was that they did not meet the required standards for end voltage. From the evidence, all this is a heap of hearsay evidence in the absence of any oral testimony by the police or a UNBS official to that effect. In any case, the documentary evidence from the UNBS which the Court has seen is itself conflicting. The import clearance certificate No. 27969 dated 21/2/2005 shows that batteries sold by the plaintiff to the defendant had been inspected and cleared. These were the same goods sold to the defendant in May 2005. And then it claimed in a certificate of analysis dated 29/9/2005 that the batteries tested did not meet the requirements of the standard for end point voltage. One wonders whether these were the same batteries earlier on tested by the same body and cleared for the market. In the absence of any evidence from UNBS to substantiate their two conflicting reports, Court is unable to say that they (reports) refer to the same goods. The defendant also contended that some other boxes of TDR Force batteries were impounded by Uganda Revenue Authority (URA) at Karuma as they were being returned to Kampala. Court has been told that the reason for impounding them was that they were being suspected to be coming from Sudan. The defendant wants the plaintiff to foot that loss as well as if the parties had agreed as to where the goods sold to the defendant would be taken for sale to raise the inference that even after the sale to the defendant, where the defendant sold them in turn remained the responsibility of the plaintiff. I do not think that this is a serious business argument.
From all the above, Court agrees with the argument of learned counsel for the plaintiff that if the goods were indeed unfit and/or expired, the defendant would have naturally rejected them and sent them back to the seller. She didn’t. There is no evidence of how much she has genuinely pocketed from that transaction and how much she has lost. And even what she lost, if any, there is no evidence to warrant blaming it on the plaintiff. I would agree with the plaintiff’s submission that the counterclaim is an afterthought designed to avoid paying the price of goods supplied. I find that the property in the goods passed to the defendant at the time the contract was made. It is immaterial that the time of payment was post poned or that the cheque issue to the plaintiff was made payable to Midland Forex Bureau Ltd. The long and short of the evidence on record is that the plaintiff sold goods to the defendant worth Shs.42,906,000- out of which it has only been paid Shs.22,906,000-. Accordingly, the defendant is indebted to the plaintiff in the sum of Shs.20,000,000- being the balance on the purchase price. For reasons stated above, the defendant’s counterclaim against the plaintiff is untenable. I would dismiss it with costs to the plaintiff and I do so.
This in effect disposes of issues (1) and (2).
As to whether the plaintiff is entitled to the reliefs sought, its first prayer is for the recovery of Shs.20m. Under S.48 of the Sale of Goods Act, where under a contract of sale the property in the goods has passed to the buyer and the buyer wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him/her for the price of the goods. In my view, by giving the plaintiff post dated cheques, the defendant committed herself to pay for the goods supplied to her by the indicated dates. The plaintiff has prayed that it be granted payment in the sum of Shs.20,000,000- The prayer is allowed.
The plaintiff has also prayed for general damages of Shs.5,000,000-. There is no prayer for general damages in the plaint. I will not award any.
It has also prayed for interest at a rate of 20% p.a on special damages from the time of filing the suit till payment in full. Again there is no prayer for interest in the plaint. However, in a case of this nature, interest is a discretionary remedy. In equity, interest is awarded whenever a wrong doer deprives the other of money for which he/she needs to use in the business. It is plain herein that the plaintiff ought to be compensated for the loss there by occasioned to its business. It is not enough that the money withheld from it by the defendant is by these presents to be replaced. For this reason, the plaintiff shall be compensated by an award of interest at the commercial rate of 20% per annum from the date of filing the suit till payment in full.
The plaintiff shall also have the costs of the suit, in the counter claim and main suit.
In the finalresult, judgment is entered for the plaintiff against the defendant in the following terms:
i.Special damages: Shs.20,000,000- (twenty million only).
ii.Interest on (i) above at the rate of 20% p.a from the date of filing the suit till payment in full.
iii.Costs of the counter claim and the main suit.
J U D G E
Order: This judgment shall be delivered on my behalf by the Registrar of this Court on the due date.