The High Court in Kampala has ruled in favour of construction giant Mota-Engil Engenharia e Construcao Africa SA in a commercial dispute against Ashland Motors Africa Limited over a failed vehicle supply contract, ordering the dealer to refund more than USD 123,000 (UGX470) and pay additional damages.
In a judgment delivered electronically on June 3, 2026, Justice Patience T.E. Rubagumya of the Commercial Division found that Ashland Motors breached its contractual obligations after failing to deliver five brand-new Volkswagen T6 double cabin vehicles despite receiving a 50 percent advance payment.
Court records show that on January 6, 2022, Mota-Engil entered into an agreement with Ashland Motors for the supply of five vehicles valued at USD 247,555. Under the contract, the vehicles were expected to be delivered within 10 to 12 weeks, subject to availability.
Relying on the agreement and assurances from the dealer, Mota-Engil paid an advance of USD 123,777.50 in March 2022. However, the vehicles were never delivered, despite repeated follow-ups, emails, and meetings between the two parties.
The court heard that Ashland Motors later cited global supply disruptions, including the COVID-19 pandemic, as the reason for the delay. It also claimed that the buyer had cancelled the contract, leading to forfeiture of the deposit.
Justice Rubagumya rejected the defence, noting that evidence, including email exchanges and meeting records, showed that Ashland Motors repeatedly acknowledged receipt of payment and promised delivery timelines that were never met.
The judge further observed that while global supply chain disruptions had affected manufacturing at the time, the defendant had already accepted the order and payment under agreed timelines and failed to deliver or provide a viable alternative.
The court also dismissed claims that the buyer had delayed the transaction or cancelled the contract, finding instead that Mota-Engil had consistently sought either delivery or a refund after prolonged delays.
The court declared that Ashland Motors breached the contract and ordered it to refund the full deposit of USD 123,777.50 to Mota-Engil.
In addition, the company was awarded UGX 45 million in general damages for financial inconvenience caused by the failure to deliver the vehicles.
The court also imposed interest at 20 percent per annum on the refunded amount from the date the suit was filed until full payment, and 6 percent interest on the damages from the date of judgment until payment is made. Costs of the suit were also awarded to the plaintiff.
The ruling reinforces the legal principle that failure to deliver goods within agreed contractual timelines, without lawful justification, constitutes a breach of contract.
It also underscores the courts’ willingness to protect buyers in commercial transactions where advance payments are made but goods are not supplied.
The decision brings closure to a dispute that began in 2022 and had left the multinational construction firm seeking recovery of its funds for several years.
English 