High Court Confirms WhatsApp Chats Constitute Valid Contractual Notice Under Land Sale Contracts; Termination Clause Rightfully Triggered Upon Title Transfer Notification.

Waboga David
Nov 8
6 min read

FACTS

The Plaintiffs, Mark Rubatsimbira and Matsiko Alexander, sued the Defendants, Andrew Babigumira and Anne Mbawa, seeking specific performance of a land sale agreement relating to Kyadondo Block 194 Plot 44, Kungu, Wakiso District, measuring approximately 55 decimals.

Initially, the parties entered into a five-year tenancy agreement, which was later converted—through an addendum dated 21 June 2018—into a procurement (sale) agreement at a total consideration of UGX 302,500,000. The Plaintiffs paid UGX 177,100,000 as part of the purchase price.

The Defendants later terminated the agreement, alleging the Plaintiffs had defaulted under Clause 7 of the addendum. The Plaintiffs challenged this termination as unlawful, contending that the Defendants had not properly issued notice as required under Clause 5, and sought orders of specific performance, damages, and penalties.

The Defendants, in turn, filed a counterclaim seeking declarations that the sale agreement had terminated within the first 29 days and that the tenancy agreement remained in force.

ISSUES

Whether the Plaint discloses a reasonable cause of action.
Whether the Defendants breached the sale/procurement contract dated 21st June 2018.
Whether the addendum to the tenancy and procurement agreement automatically terminated under Clause 7.
Whether the Defendants rightfully terminated the agreement.
Whether the counterclaim discloses a cause of action.
What remedies are available to the parties.

SUBMISSIONS

Plaintiffs’ Submissions

The Plaintiffs argued that they had paid substantial consideration and that termination without notice contravened Clauses 5 and 6 of the agreement.

Counsel relied on Auto Garage v Motokov (No.3) [1971] EA 514, emphasizing that the Defendants’ refusal to transfer the title constituted a breach.

They argued that under Clause 5, the Defendants had to first obtain registration in their name, notify the Plaintiffs, and then demand payment of the balance, only upon default could termination follow.

They denied receiving any valid notice as required by the contract and maintained that the WhatsApp communication relied on by the Defendants did not constitute proper notice.

Defendants’ Submissions

The Defendants contended that termination was proper under Clause 7, which allowed the agreement to end automatically after 14 days of non-compliance.

They argued that Clause 5 (default) and Clause 7 (termination) were distinct, and the Plaintiffs’ attempt to link them amounted to rewriting the contract.

Counsel submitted that the title was duly registered in the 1st Defendant’s name and the Plaintiffs were informed via WhatsApp messages, which satisfied the requirement of “receipt of information.”

Since no payment was made within 14 days after that communication, the contract was rightfully terminated.

LEGAL REPRESENTATION

For the Plaintiffs, Counsel Samuel Kiriaghe and Eric Tumwesigye (M/S MRK Advocates)
For the Defendants, Counsel Simon Kiiza (M/S S.K. Kiiza & Co. Advocates)

COURT’S FINDINGS

The High Court’s determination focused on the proper interpretation of Clauses 5 and 7 of the addendum to the tenancy agreement, which lay at the heart of the dispute.

Justice Aisha Naluzze Batala began by emphasizing that the court’s role in contractual disputes is to give effect to the parties’ intentions as expressed in the contract’s language, rather than to rewrite the agreement or import notions of fairness. The Court adopted two interpretative principles:

Literal Interpretation, contractual words must be given their ordinary, grammatical meaning, especially where the language is clear and unambiguous.
Whole-Contract Approach, the contract must be read as a whole so that each clause is interpreted consistently with the others and within the overall commercial context.

Justice Naluzze stated:

“The interpretation of contracts is essential in ensuring that parties understand the rights and obligations outlined within the agreement. When disputes arise, the court’s primary objective is to ascertain the intention of the parties based on the language used in the contract.”

1️⃣ Clause 5 – “Receipt of Information” and Payment Obligation

Clause 5 of the addendum stipulated three sequential obligations:

The Defendant had to procure registration of the suit property in his name.
The Plaintiffs had to receive information of such registration.
The Plaintiffs were to pay the balance of the purchase price within 14 days from receipt of that information.

The Defendants tendered evidence from the Ministry of Lands search printout, confirming that the title to Kyadondo Block 194 Plot 44 had indeed been registered in the 1st Defendant’s name.

They further adduced WhatsApp communication between the parties showing that a copy of the new title was shared with the Plaintiffs. The Plaintiffs did not dispute receipt of this communication.

Justice Naluzze held that the contract did not prescribe any specific mode of communication. Therefore, the WhatsApp message satisfied the requirement of “receipt of information.” She observed:

“The Plaintiffs have not denied that they received information that the title had been changed to the name of Babigumira Andrew. Hence, this Court can conclude that they received information that the title had been changed.”

The Court thus accepted that notification through WhatsApp constituted valid communication under Clause 5, marking a progressive recognition of electronic communication in contractual performance.

2️⃣ Clause 7 – Automatic Termination for Non-Compliance

Clause 7 provided that:

“This agreement terminates 14 days upon the party’s failure to comply with the terms agreed herein and time is of essence and is to be strictly observed and shall not be subject to any notice.”

Upon receiving information of title transfer, the Plaintiffs failed to pay the balance within 14 days, thereby triggering the automatic termination mechanism in Clause 7. The Court held that Clause 7 was clear, self-executing, and unambiguous, requiring no further notice or action by the Defendants.

Justice Naluzze concluded:

“Clause 7 is clear, unambiguous, and it was agreed upon by both parties. What matters most is that the information was received by the Plaintiffs… Therefore, there was no breach of contract, and the contract was rightfully terminated.”

Accordingly, the Court found that the Defendants lawfully terminated the addendum and that the original tenancy agreement between the parties remained valid and subsisting.

3️⃣ Cited Precedents and Doctrinal Support

The Court referenced several authorities to support its interpretive and evidentiary findings Auto Garage v. Motokov (No.3) [1971] EA 514 , on what constitutes a cause of action (duty, breach, and damage). Applied to confirm that both the Plaint and the counterclaim disclosed reasonable causes of action. Kapeka Coffee Works Ltd v. NPART [CACA No. 3 of 2000], reaffirmed that in determining cause of action, the Court must consider only the pleadings and annexures, not external evidence. Dooba Developments Ltd v. MacLagan Investments Ltd [2016] EWHC 2944 (Ch), cited for the principle that where the wording of a contract is clear and unambiguous, courts must give effect to the literal meaning without resorting to commercial common sense or subjective intention.

Applying these precedents, the Court held that the Defendants’ actions were squarely within their contractual rights and that the Plaintiffs’ failure to pay constituted default, not breach by the Defendants.

4️⃣ Title Transfer and Evidence

The Ministry of Lands search report conclusively showed that the 1st Defendant had obtained registration as proprietor. This fact was unchallenged. The Court therefore accepted that the Defendant fulfilled his obligation under Clause 5(a) and the Plaintiffs’ payment obligation under Clause 5(b) had arisen and remained unperformed.

The site (locus in quo) visit confirmed that the Plaintiffs were still in possession of the property but had no legal basis to compel transfer or claim specific performance since the addendum had terminated automatically.

5️⃣ Counterclaim and Remedies

On the counterclaim, the Court held that the Defendants had a valid contractual right to terminate and therefore a legally sustainable cause of action. However, recognizing principles of equity and restitution, Justice Naluzze ruled that the Defendants must refund monies already paid by the Plaintiffs for total failure of consideration:

“Court notes that the Plaintiffs advanced a total of Ugx 177,100,000… towards the Defendants as part of the purchase price... As a result, the 1st Defendant ought to refund the monies advanced to them for total failure of consideration.”

Accordingly, while the Plaintiffs’ suit for specific performance and damages was dismissed, the Court ordered refund of UGX 177,100,000 to prevent unjust enrichment.

HOLDING

The Plaint disclosed a reasonable cause of action. ✅
The Defendants did not breach the procurement contract. ❌
The Addendum was lawfully terminated under Clause 7. ✅
The Defendants rightfully terminated the contract. ✅
The Defendants’ counterclaim disclosed a cause of action. ✅
The Plaintiffs’ suit was dismissed, but the Defendants were ordered to refund UGX 177,100,000 to the Plaintiffs for total failure of consideration. ✅

FINAL ORDERS

Declaration that the Addendum dated 21 June 2018 was lawfully terminated.
Declaration that the Tenancy Agreement of 1 January 2017 remains valid.
Order directing the 1st Defendant to refund UGX 177,100,000 to the Plaintiffs.
Costs of the suit and counterclaim awarded to the Defendants.

KEY TAKEAWAYS

Literal Meaning Prevails in Contractual Interpretation.
Courts will give effect to the clear, unambiguous language of a contract. Commercial common sense or fairness cannot override express terms.
Electronic Communication as Notice
WhatsApp messages were deemed valid evidence of “receipt of information,” marking a progressive acknowledgment of electronic communications under Ugandan contract law.
Clause Independence
Clauses dealing with default and termination must be read distinctly unless expressly linked. A clause providing for automatic termination is self-executing.
Strict Observance of Time
When “time is of the essence,” non-compliance within the stipulated period can validly terminate the contract without further notice.
Failure of Consideration Entitles Refund
Even when termination is lawful, advance payments may be recoverable where the underlying transaction fails to materialize.