Property development firm, Meera Investments Ltd, has jointly sued FBW (U) an architectural firm, together with its two architect directors- a one Nigel J. Tilling and another Paul Moores for breach of contractual obligation to deliver services for the extension of Kabira Country Club.
In a suit, No. 723 of 2020, filed in the Commercial Division of the High Court in Kampala, Meera Investments, a member of the Ruparelia Group, has through their lawyers, Magna Advocates and Ssemambo & Ssemambo Advocates asked the court to declare that FBW breached its contract for supply of services including design development, encompassing architectural, structural engineering, mechanical and electrical engineering, other civil engineering services, design team coordination, construction and supervision for the extension of Kabira Country Club.
The plaintiff (Meera) also wants the court to declare that FBW’s directors, Nigel J. Tilling and Paul Moores breached their professional duty and undertaking. Meera Investments wants the court to compel the defendants to refund money advanced to them, pay general damages, special damages, and exemplary damages, payment of interest, and costs of the suit.
“An order for a refund of USD132,750 being money had and received to the plaintiff’s use by the defendants; General damages inclusive of USD 2,672,579 being lost profits/income arising out of the 1st defendant’s (FBW) breach of contract and the 2nd and 3rd defendants’ breach of professional duty and undertaking; special damages of USD286,739.48 arising out of the defendant’s breach of contract and the 2nd and 3rd defendants’ breach of professional duty and undertaking,” the suit reads in part.
Background
Having previously used their services on other Group Projects, in 2012, Meera Investments sought the services of FBW for the design development, encompassing architectural, structural engineering, mechanical and electrical engineering, other civil engineering services, design team coordination, construction supervision, and incidental services for the expansion of Kabira Country Club.
On 6th February 2012, it was agreed that Meera would pay a total of USD375,000 broken down as follows: 15 percent of the agreed contractual sum (USD56,250) on commencement/concept submission; 15 percent of the agreed contractual sum (USD56,259) on finishing the outline design; 30 percent of the agreed contractual sum (USD112,500) on the submission of construction drawings package. A further 20 percent of the agreed contractual sum (USD75,000) would be paid in-between project construction; 10 percent of the agreed contractual sum (USD37,500) in between project construction; 5 percent of the agreed contractual sum (USD18,750) on the completion of the shell & core, and finally 5 percent of the agreed contractual sum (USD18,750) on building completion.
As per the agreed terms, Meera paid FBW the first three installments, but upon receipt of the 3rd installment, the defendants were expected to submit the construction drawings package, per the agreed terms, which they did not do.
The parties nevertheless, mutually agreed that the pending work on the Kabira Country Club project be stayed until the construction and completion of the Speke Apartments Wampewo Project, which FBW was also working on. On 18th October 2018, the parties sat and agreed that construction on the extension of Kabira Country Club would start in January 2019 and FBW would accordingly deliver all the necessary works for the project to resume by 18th December 2018. FBW according to the suit, undertook to revise the project and submit all the revised project drawings before the end of December 2018 to be in time for construction by January 2019.
However, Meera in the suit contends that FBW failure to honour this commitment, but instead demanded payment of the 4th installment, a payment that should have been paid once construction had started.
TRIBUTE | Miriam Ekirapa Musaali: A Testament of Faith, Courage, and Enduring Strength Against CancerBecause of the urgent nature of the project, the defendant was constrained to make a 4th installment, worth USD75,000. But rather than deliver the job, FBW again, instead asked for the 5th Installment (USD37,500) which Meera was constrained to pay on the 18th of November 2018.
“The Plaintiff further avers that, while making the said advance payments beyond the 3rd installment, it was under the assumption that the Defendants would eventually fulfill their express and implied obligations under the contract during the construction period even after receiving the payment earlier than what was agreed upon or what the standard practice and procedure dictates and that the advanced payments would be offset at the respective stages of the Contract as being already received by the Defendants,” reads the suit.
Despite receiving the 4th and 5th installments, FBW still failed to deliver the job and instead made further demands for the 6th installment which Meera refused to pay.
The suit states that the defendants instead of submitting the constructions drawing in both soft, editable, and adjustable copies as well as the hard copies, they only sent soft copies and in PDF format which were neither adjustable not usable by the plaintiff.
The refusal to hand over all documents as required by the plaintiff’s contractor meant that the project could not commence on the agreed date of January 2019, something that led to the plaintiff being issued with a penalty and fine notices by the contractor for the delay in commencement of the project. Meera would also engage other consultants and altogether had to incur an extra cost of USD286,739.48, an amount it wants FBW to refund as special damages.
As a result of the delays the project that should have started in January 2019, started in September 2019, thereby denying Meera the opportunity of deriving income from the project from January 2022 when the project was expected to be completed to August 2022. The suffered loss of projected income computed by its valuers basing on the existing hotel and increased volumes has been estimated at a tune of USD 2,672,579 which Meera now seeks to recover from FBW.
The extension of Kabira Country Club, involves the construction of 269 serviced and full-furnished 1, 2 &3 bedroom apartments, with two levels of underground parking- altogether 62,000 square metres of built-up space. The project sits on 4 acres of land.
FBW has been asked to file a written defense within 15 days from 15th September 2020 by the Commercial Court.
