The Court of Appeal has reaffirmed that oral land contracts can be enforced if essential terms and intention are proven by conduct, even without a written agreement.

INTRODUCTION

The law on land transactions in Uganda mainly revolves around land sale agreements, largely because such agreements constitute the primary means by which proprietary interests are transferred between parties. Rarely do land transactions proceed without a written agreement, given the statutory and evidentiary requirements under Ugandan law. These agreements not only evidence the parties’ intentions but also set out the terms, obligations, and conditions governing the transfer.

In practice, land sale agreements operate within the framework of the Contracts Act, the Registration of Titles Act, and other related statutes. Compliance with these laws is essential to ensure the validity and enforceability of the transaction. Failure to meet legal requirements—such as proper execution, adequate consideration, and adherence to registration procedures—often results in disputes, which can be protracted and costly.

Nonetheless, the recent decision of the Court of Appeal reaffirms that oral land contracts may still be enforced where the essential terms and the parties’ intention can be established through their conduct, even in the absence of a written agreement.

Background

The respondent sued the appellant in the High Court seeking specific performance, general damages, and costs, arising from an oral agreement for the sale of half an acre of land at Muyenga, Kyadondo Block 244 Plot 2611. The agreed consideration was UGX 110,000,000 plus a piece of land in Bukasa valued at UGX 60,000,000, along with other agreed conditions.

The respondent paid UGX 50,000,000 in part payment and handed over the title for his Bukasa land to the appellant. In return, the appellant gave the respondent the title to the suit land and a signed mutation form for subdivision. Later, the appellant refused to accept the balance, sign transfer forms, or complete the sale.

The appellant denied that a binding contract existed, claiming the price was still under negotiation and that the Bukasa land was unsolicited. He stated he was willing to refund any payments made.

The High Court found there was a valid land sale contract, supported by the appellant’s receipt of payments, signing of a mutation form, and delivery of the title. It held that both parties had partially performed the agreement, but the appellant breached it by refusing to complete the transfer.

Judgment was entered for the respondent, ordering the appellant to complete the transfer upon receipt of the balance, remove any barriers to the land, pay UGX 10,000,000 in general damages, and cover costs.

Dissatisfied, the appellant lodged an appeal on grounds including lack of contract, lack of part performance, reliance on inapplicable authorities, improper award of specific performance, and failure to properly evaluate evidence.

Grounds of Appeal

The appellant challenged the High Court’s decision on:

1. Existence of a valid contract.

2. Finding of part performance.

3. Reliance on inapplicable authorities.

4. Award of specific performance contrary to precedent.

5. Improper evaluation of evidence.

   
   

Coram

Asa Mugenyi, JA/ JCC, Musa Ssekaana, JA/JCC, Stella Alibateese, JA/JCC

Submissions

Appellant’s Arguments

Counsel argued there was no valid contract between the parties, citing Stanley Beinababo v Abaho Tumushabe (Civil Appeal No. 11 of 1995) to support the view that payment alone does not amount to part performance sufficient to enforce an oral land contract.

That the Disagreement existed over key terms, including purchase price (UGX 110M or 120M), additional land offers, retaining wall construction, and road repairs.

The trial judge wrongly treated the subdivision of land as evidence of part performance; according to the appellant, this was only to facilitate administrative processes.

That the authorities like Lysaght v Edwards were said to apply only where a valid written contract exists, unlike the present case.

The appellant contended specific performance cannot be granted without a written, definite contract and that such an order would cause hardship; the appropriate remedy would be restitutio in integrum (restoration to original position).

Allow the appeal, set aside the lower court’s judgment, and replace it with an order for restitution.

Respondent’s Submissions

 Counsel maintained that the trial judge correctly found a binding contract based on the parties’ conduct, including repeated payments, the appellant’s acknowledgment of receiving money, participation in surveys, subdivision of land, signing of mutation forms, and requesting a substitute title page.

The respondent argued that subdivision, demarcation, and initial possession (before being blocked by a retaining wall) constituted part performance. Cited Issak Semakula v William Setimba to support that partial payment plus possession creates an equitable interest.

The trial judge’s reliance on precedents was justified since a valid contract had been established from conduct.

Specific performance was proper given the respondent’s financial investment, lack of hardship to the appellant, and the fact that the land portion was identified and demarcated. Damages would not be adequate compensation.

Dismiss the appeal with costs and uphold the lower court’s decision.

Appellant’s Rejoinder

Reiterated that no valid contract existed under Section 10(5) of the Contracts Act 2010 (requiring contracts above UGX 500,000 to be in writing).

Claimed uncertainty in consideration terms made specific performance inappropriate and potentially unfair.

Court of Appeal Analysis & Decision

1. Valid Contract

1. Although negotiations occurred, evidence showed mutual assent through actions: payments, handing over titles, mutation signing, and participation in subdivision.

2. Oral contracts for land can be enforceable if essential terms are clear and intention is proven (Kobaku Associate v. Owusu, Stanley Bainebabo v. Abaho Tumushabe).

3. The appellant’s conduct inconsistent with mere negotiations — belated rescission attempt was an afterthought.

2. Part Performance

1. Both parties acted in furtherance of the agreement:

   • Respondent made payments and offered Bukasa title.

   • Appellant accepted payments, signed mutation form, and allowed subdivision.

2. Possession is not the sole determinant; conduct consistent with contract suffices.

3. Reliance on Authorities

1. Once validity of contract was established, reliance on Lysaght v. Edwards and H.M. Kadingidi v. Essence Alphonse was proper.

2. Appellate review focuses on correctness of decision, not correctness of reasoning alone.

4. Specific Performance

1. Land is unique; damages inadequate (Ismail Jaffer Allibhai v. Nandlal Harjivan Karia).

2. No evidence appellant would suffer hardship; he permitted substantial progress towards transfer.

3. Specific performance appropriate given breach and respondent’s substantial compliance.

Holding

1. Appeal dismissed with costs.

2. High Court orders (specific performance, payment balance, removal of access obstruction, general damages) upheld.

   
   

Key Takeaways

1. Oral land contracts can be enforced if essential terms and intention are clearly proven by conduct, even without written agreement.

2. Part performance is established through actions consistent with the agreement (e.g., payments, title handover, mutation signing), not just possession.

3. Appellate courts defer to trial court findings where evidence was properly evaluated.

4. Specific performance remains the primary remedy for breached land sale agreements due to the unique nature of land.

5. Rescission after substantial part performance is unlikely to succeed; courts may treat it as an afterthought.

Read the full decision

Israel Mayengo v John Lwalanda 2025 UGCA 267 (11 August 2025).pdf

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