Lubowa Gardens Ltd & Anor v Equity Bank Ltd (HCCS NO. 111 OF 2013) [2018] UGCOMMC 4 (26 February 2018);


Headnote and Holding: 

The matter involved a dispute over the defendants’ refusal to release a certificate of title pursuant to an agreement to do so. 

The first issue was whether the defendant was justified in not releasing the certificate of title belonging to the plaintiffs. The court observed that the defendant’s conduct in refusing to release the title created an impression of premeditated non-performance with the defendant only using the purported mala fides (bad faith) conduct as a farcical reason. The court thus concluded the defendants' conduct was unjustifiable.

The second issue was whether the conduct led to loss for the plaintiffs.  Concerning whether there was loss of profits due to the plaintiffs being detracted from clearing their indebtedness the court found there was insufficient evidence to support it.Similarly, on the corresponding allegation that the conduct resulted in the incurring of interests due to another creditor, the court held that  payment of interests had not been proved by the plaintiff. It thus denied the claim for both loss of profits and interest payments. 

However, the court did accept that the actions of the defendant prevented them from discharging their indebtedness and thus resulted in the incurral of interest. It thus absolved the payment of the interests that arose within the affected period and consequently snuffed the corresponding counter-claimed interests for the period.

Regarding damages, the court reasoned that the plaintiffs had acted on the impression that the title would be released to enter into some arrangements which were frustrated by the defendants' unjustified conduct. It therefore granted general damages. Similarly, because of the defendants' oppressive and high-handed conduct, the court granted punitive damages.  


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