Professional Documents
Culture Documents
Firm X CCP Module 4 Learning Ones (Week One Term Two)
Firm X CCP Module 4 Learning Ones (Week One Term Two)
Firm X Partners
1. Mpaata Jerome Owagage
2. Julianne Mwebaze
3. Diane Niyogusabwa
4. Aine Raymond
5. Ndobya Gerald
6. Muhanuuzi Dorah
7. Mulindwa Fredrick
8. Daphne Musoki
9. Awino Mercy
10. Kule Roland
WORKSHOP ONE.
Learning Outcomes 1 and 2.
1. Identify a contract of sale of goods; and a contract for supply of services;
2. Classify a contract of sale of goods and supply of services and explain the salient
features and terms thereof
SELLER BUYER
Section 60(3) where the buyer wrongfully Section 63(1), the Court may on application of a
neglects or refuses to pay for goods or services, party, direct that the contract be performed
the supplier or seller may bring an action for the specifically, without giving the defendant the
price and incidental damages. option of retaining the goods or paying damages.
II. Incidental and Consequential damages II. Incidental and consequential damages
Section 65(1) includes any commercially Section 65(2) include expenses reasonably
reasonable charges, expenses and commission incurred in inspection, receipt, transportation and
incurred in stopping the delivery, care and care and custody of goods rightfully rejected, any
custody of goods after the buyer’s breach. commercially reasonable charges, expenses or
commissions in connection with effecting
III. Right of resale
insurance cover, and any other reasonable
Section 51(c) a right to resale as limited by this expenses incidental to the delay or other breach.
Act is given to an unpaid seller despite the fact
III. Damages for non-delivery
that property may have passed.
Section 62(1) where the seller or supplier
Section 59(4) where they have expressly reserved
wrongfully neglects or refuses to deliver the
the right of resale if the buyer defaults.
goods or supply the services to the buyer.
IV. right to a lien
IV. Damages
Section 52, an unpaid seller in possession of
Where there has been breach of a warranty, or a
goods has the right to retain possession until the
condition that has been waived to constitute a
contract price has been paid where; the goods
warranty under Section 12(1).
have been sold without any stipulation as to
credit, the goods have been sold on credit, but V. Repudiation
the term of credit has expired, or the buyer Implicit in Section 12(1),
becomes insolvent.
And Section 1 of the Act.
Section 53 may retain the rest of the goods
Section 64(1) (2) bring an action against the
where there has been partial delivery.
seller for damages for breach of warranty.
Section 59(2), a resale of such goods enables the
VI. Rejection of goods
buyer to acquire good title.
May accept some and reject others. Section
V. Right of stoppage in transit
38(1)
Section 55, when the buyer of goods becomes
VII. Have the goods repaired or replaced
insolvent, the unpaid seller who has parted with
possession has the right to stop them in transit Section 47(1) the buyer may require the seller to
and resuming possession of the goods as long as repair or replace the goods.
they are still in the course of transit and may Section 49, give them a reasonable time to repair
retain them until payment or tender of the price. the goods.
Section 61(1) may bring an action for non- Section 48(1) where goods do not conform to the
acceptance where the buyer wrongfully neglects contract, the buyer may require a price reduction
or refuses to accept and pay for the goods. or rescind the contract if: it is impossible or
VII. Interest and special damages impracticable to reduce the price, or the seller
refuses to reduce within a reasonable time.
Section 66, where these can be obtained where
by law, interest or special damages are IX. Interest and special damages
A. PRELIMINIRIES
(i) Conditions
A condition is a fundamental term of the contract which goes to the very root of the contract. A
failure to perform a condition will render the contract significantly different from that contracted
for. Breach of a condition entitles the innocent party to treat the contract as repudiated and itself as
discharged from performance of all outstanding obligations under the contract.
Poussard v Spiers and Pond [1876] 1 QBD 410 (Contracted to sing but did not show up-Breach of
condition). There are circumstances where breach does not go the root Bettini v Gye [1876] 1 QB
183(contracted to sing, including six days of rehearsal and she missed some- damages awarded)
In Sihra Singh Santokh v Faulu Uganda Ltd (Civil Suit 517 of 2004), referring to Buckland vs.
Farmer & Moody (1978) 3 All ER 929 at 938 (CA). that referred to Halsbury’s Laws of
England, Vol.9 (1), Re-issue, paragraph 989, It was stated that is a well recognised principle at
common law that where a condition of the contract has been breached by one party the other party
is entitled to rescind the contract or to treat it as discharged, and the contract would terminate as
from that moment.
(ii) Warranties
A warranty is considered as ancillary to the main terms of a contract. A breach of a warranty
would only amount to damages, and the innocent party does not have the right to repudiate the
contract.
In Wills v Amber [1954] 1 Lloyd’s Rep 253, a four-berth motor boat had been sold. An innocent
statement by the seller that the hull was sound was held to be a warranty, which the buyer had
entered into the contract in reliance upon it, when in fact the hull was rotten.
In Sihra Singh Santokh v Faulu Uganda Ltd (Civil Suit 517 of 2004), the court stated that
the Breach of a condition would entitle the wronged party to rescind the contract, as well as
claim damages for any loss s/he may have suffered; whereas a breach of warranty would
only entitle him or her to damages. The determination as to whether a contractual term is a
condition or warranty depends on the intention of the parties as deduced from the
construction of the contract. Where the contract contains no indication on its face of the
status of the terms, the trial court must review the contract within the context of its extrinsic
circumstances in order to determine the intention of the parties. Important factors to be
taken into consideration include the extent to which the performance of the term under
scrutiny would be likely to affect the substance and purpose that the contract is intended to
carry out.
(ii) Conditions being treated as warranties Under Sale of Goods and Supply of
Services
-Section 12. Whether something is condition or not depends on the stipulations laid down
in the contract.
-Section 12(1) The buyer/supplier may waive a condition to be treated as a warranty and
hence not aground for repudiating a contract
-Section 12(2) Stipulations in regards to what amounts to a condition hence rescission of a
contract or a warranty hence an award of damages, is up to the parties.
-Section 12(3) A stipulation may be a condition, whether or not it is called a warranty. In
the case of Schuler AG v Wickman Machine Tool Sales Ltd [1974] AC 235, The House of
Lords stated that a breach of a condition allows for termination of the contract. But the case
also shows that even if the parties themselves expressly designate a particular obligation as
a condition, the word condition is not always conclusive.
-Section 12(4)(b) –where property in specific goods has passed to the buyer, the breach
of condition is treated as a breach of a warranty and hence the buyer can only sue for
damages.
Section 11- payment time (it is not important unless the contract dictates so.
It should be noted however that contracts for sale of goods and supply of services, have
terms implied into the contract under;
- section 13(Implied terms as to title), 15 (implied term as quality and fitness for purpose)
(for goods)
-Section 16-Implied term as to quality of materials to be used. Section 18-Implied terms
as to care and skill (for Services)
C. EXCLUSION CLAUSES
An exemption clause in a contract is a term which either limits or excludes a party’s liability for
a breach of contract. The clause must be incorporated in the contract (incorporation can be
signature (L’Estrange v E. Graucob Ltd [1934] 2 KB 394), Notice (Chapelton v Barry Urban
District Council [1940] 1 KB 532), must pass the test of construction and must not be rendered
unenforceable by the statutory provisions.
-Except for those the law interferes with, the common law provides no rule whereby an exclusion
clause would be declared unenforceable on the grounds that it is unfair or unreasonable-Photo
Production Ltd v Securicor Transport Ltd [1980] AC 827.
-These clauses can exclude anything in the contract clauses, liability of consequential loss
regarding anything in contractual obligations, limit the remedies available on those remedies.
The rules relating to exclusion clauses were discussed in the case of Ok Zimbabwe Limited V
Msundire (CIVIL APPEAL NO. SC 111/12) wherein the court stated that;
In general, parties to a contract are at liberty to exempt each other from the
consequences flowing from a breach of the contract. For this reason, corporate
entities and public institutions providing a particular service or engaged in a
contractual relationship with another exempt themselves from liabilities they
would otherwise incur. In general, if both parties are aware of the exemption no
real difficulties are encountered. However, such an exemption can be an
expensive trap for an unwary client.
For the above reason, the courts, have set limits to the exemption that they will
permit by interpreting such a clause narrowly. In doing so, the court endeavors to
ascertain what the parties intended the exemption to cover. However an
exemption that is contra bonos mores (against good morals) will not be permitted.
For example, a party may not exempt himself from his own fraud.
The approach of the courts is to adopt a narrow interpretation of exemption
clauses and adopt the principle that, unless the scope of the exemption is clearly
expressed, it must be interpreted as giving minimum protection to the party in
whose favour it operates.
(cited) Tubb (Pvt) Ltd v Mwamuka 1996 (2) ZLR 27 (S), restates the principles
applicable in exemption clauses. These may be summarised as follows:
i. the words of the exemption clause must be read as part of the contract and
must be sufficiently clear and comprehensive for a court to give effect to
them.
ii. any ambiguity as to meaning and scope of the exemption must be
interpreted against the proferens unless he proves that the words used
embraced the contingency that has arisen.
iii. if there is not an express reference to negligence in the exemption, the
court must consider whether the words are wide enough to cover
negligence on the part of the defendant or his servants and if so whether
the claim for damages may be based on some ground other than
negligence.
iv. where the existence of an exemption excluding liability for negligence is
not in dispute, the burden of establishing any other possible ground for
liability such as gross negligence or dolus, rests upon the claimant.
v. the exemption must be within the knowledge of the other party at the time
the contract is entered into.
vi. a party cannot exempt himself from liability for wilful misconduct, or
criminal or dishonest activity of himself, his servants or agents or from
damage resulting from gross negligence on his part or that of his servants.
vii. In a related context, the Consumer Contracts Act [Chapter 8:03], provides
that where a court finds a consumer contract to be unfair, it may, inter alia,
cancel the whole or part of a contract, vary the contract, enforce part only
of the contract, declare the contract enforceable for a particular purpose
only, order restitution or reduce any amount payable under the contract.
Such power may be exercised by a court mero motu or on application by
any affected party. A court is, inter alia, entitled to find a contract to be
unfair if, in all the circumstances, the contract is unreasonably oppressive.
Whilst participation in a promotion might not constitute a “consumer contract” as
defined, it was clear that the general principles applicable to exemption clauses have
been captured in the acts. The defendant could not avoid liability.
Furthermore in Photo Production Ltd Vs Securicor Transport Ltd, the court stated that the
question that whether and to what extent, an exclusion clause is to be applied to a fundamental
breach, or breach of a fundamental term, or indeed to any breach of the contract, is a matter of
construction of the contract. At the stage of negotiating, there is everything to be said for
allowing the parties to estimate their respective claims according to the contractual provisions
they have themselves made rather than for facing them with a a legal complex so uncertain as
the doctrine of breach must be.
Rules pertaining to the interpretation of exclusion clauses were discussed in Assist (U) Limited V
Italian Asphalt & Haulage Limited & Anor HCCS No 1291 Of 1999 wherein the court stated
that; The plaintiff and first defendant entered into a lease agreement on the second defendant’s
land. The plaintiff was allowed to make repairs in return for abatement of rent or possible sale of
land to him. Fights broke out about the value of reimbursement, the plaintiff withheld rent until
he could be reimbursed. The defendant distressed for rent, advertised to sell but the plaintiff
obtained an injunction restricting the same.
Para 3(c) of the agreement stated that "The demised premises are in need of substantial repairs
and the sub lessee shall have the option to repair the premises at his discretion and shall be
reimbursed by the sub-lesser for the costs incurred thereof by way of an abatement rent or whilst
valuing the premises for the purpose of sale to the sub-lessee"
The defence asked the court to interpret this clause under the contra preferentem rule.
Learning Outcome 5: Draft comprehensive contracts of sale of goods, and supply of services
BETWEEN
COOPER MOTORS LTD, a company duly incorporated and registered in and under the laws
of Uganda, of P.O. Box *** Head Office at Nakawa Industrial area in Kampala (hereinafter
known as "Seller");
AND
HARD WARE WORLD LTD (hereinafter known as "Buyer") of P.O. Box [….] Head Quarters
in Ntinda Kampala. The Seller and the buyer may herein jointly be referred to as parties and
individually as the party.
RECITALS
WHEREAS, the seller is a leading importer and seller of MAN Truck Trailers in Uganda.
WHEREAS, the buyer is interested in the goods of the seller, MAN truck trailers.
NOW THEREFORE THE PARTIES AGREE TO BE BOUND by the terms and conditions set
out;
Quantity: Two 40 Ton Man truck trailers [How many do you want?]
1.2 In the event of any alteration of Goods as per clause 1.1 above the parties may where deemed
fit by the seller in its reasonable discretion, agree to the reduction in price, change of delivery
time or other changes as shall be necessary in the circumstances.
2.1 The buyer shall pay the Purchase price of 40 Ton MAN Truck Trailer is UGX 900,000,000/=
(Nine Hundred Million) each.
2.2 All late payments attract a surcharge of 15% per month [This is used when there are
deadlines as to the date of payment].
2.3 All payments shall, under all circumstances, be paid directly to the seller. [In case there is an
alternative mode, it can as well be stated]
2.4 Buyer can take possession of the TWO, 40 Ton MAN Truck Trailers upon payment of
balance the purchase price on the date of delivery of 40 Ton MAN truck trailers.
2.5 Title in the vehicles however will pass to the Buyer upon payment of the full
consideration. [These two paras inform whether property in the goods passes; further still, these
two paras state it is a contract of sale or agreement to sell goods]
It is agreed that:
3.1 Delivery of Acquired 40 Ton MAN Truck Trailers - Seller shall deliver the Acquired
Trailers, and Buyer shall take possession of the same, at Seller's premises (either in person or
through a third party) on or before the date duly agreed by the parties. If delivery is to be made at
a date after the execution of this contract, it is Seller's duty to ensure that the Acquired Vehicle is
delivered in the same condition as when last inspected by the Buyer (or, if no Buyer inspection,
the execution date of this agreement).
3.2 Conveyance of Title. Seller shall also deliver the Registration Certificate in original to Buyer,
all necessary paperwork and documentation relating to ownership of the Trailers upon full
payment of the Trailers. Seller agrees and covenants to execute all documents presented by buyer
which are necessary to finalize transfer of title and registration upon the Acquired Vehicles to
buyer upon payment in full.
3.3 The seller warrants that all details provided about the trailers are accurate.
3.4 The Seller has made the buyer fully aware of any current faults of which he is reasonably
aware with the trailers and that there are no deliberately hidden faults on the trailers.
3.5 The seller is not liable for subsequent faults, normal wear and tear, or defects unless those
defects were deliberately hidden or if a guarantee is offered by the seller to the buyer.
It is agreed that:
4.2 The buyer warrants that all details provided are accurate.
4.3 The buyer acknowledges that the acquired trailers and related documents have been duly
inspected and approved by him and have been found to his entire satisfaction.
4.4 Buyer agrees to submit a notice of transfer of ownership for the acquired vehicles to the
Uganda Revenue Authority within 15 days from the delivery date. The buyer acknowledges his
responsibility to update ownership details with the Uganda Revenue Authority.
5.1 The place of delivery of goods shall be the premises of the buyer.
5.2 Risk and damage to or loss of the goods shall pass to the buyer upon delivery.
5.3 Notwithstanding the foregoing, full legal title and interest in the goods shall remain in the
seller and shall not pass to the buyer until the seller shall have received full payment
6. WARRANTIES
6.1 It holds adequate insurance to cover its employees and workmen and the goods of the buyer
during the time that risk in the goods is upon the seller.
6.2 The seller expressly disclaims any implied warranties of merchantability or of fitness for a
particular purpose after due inspection and possession by the buyer.
7. LAW APPLICABLE
7.1 This Agreement shall be construed in accordance with the Laws of Uganda
8. TERMINATION
8.1 Either party [Aggrieved party] may terminate this Agreement immediately by notice in
writing.
8.2 If any party in breach of any terms of this agreement fails to remedy such a breach within
5[five] days; the aggrieved party shall be entitled to terminate upon reasonable notice in writing.
9. VARIATION
Any variation to this sale agreement shall be made in writing and signed by both parties.
10. ACKNOWLEDGEMENTS
Each party acknowledges that he or she has had an adequate opportunity to read, examine, and
consult with attorneys if he or she has so desired.
Any dispute arising out of this agreement shall be referred to a mutually appointed mediator
prior to any court action.
IN THE WITNESS WHERE OF THE PARTIES hereto have put their respective hands and
seals; the day and the year first herein above written;
The seller
In the presence of
Name: ……………..
Signature: …………
The Buyer
Name: ………………
Signature:....................
Insofar as making Contractual Documents is concerned, Sections 2(2), (3), (4) and (5) of the
SoGSS Act, 2017 – the intention has to be made clear. Under a Contract of Sale, the property in
the goods passes on the instant from the seller to the buyer; but under a sell agreement, the
property in the goods happens at a later stage. This informs the central distinction btn these two
documents. In any case, such document should contain;
a. The parties
b. Subject Matter of the Contract
c. Consideration/Price
d. Terms of the Contract
e. Obligations of the Parties
f. Delivery Period/Performance of the Obligations
g. Risk
h. Dispute Resolution Mechanism
i. Witnessed and Signed
j. Dated.
WORKSHOP TWO
Learning Outcome One: Explain the scope of the Public Procurement and Disposal of Public
Assets Act, 2003 (“PPDPA Act”) (Discusses contract management under the procurement
process in the first part- this was discussed in prep. for the IA)
Contract Management
(c) the period of 10 days specified in regulation 5 expires, following the notice of best
evaluated bidder;
(d) the accounting officer confirms that the procurement is not subject to any
administrative review;
(e) the full amount of the funding for the period of the proposed contract is committed;
(f) All relevant agencies, including, the Attorney General make the necessary approval of
the contract. (The Constitution (Exemption of Particular C
(1) The accounting officer or a person appointed by the accounting officer from the user
department shall manage the contract.
(2) The procurement and disposal unit shall provide a copy of the contract to the person
appointed by the accounting officer to manage the contract.
(3) Upon receipt of a contract, the contract manager shall prepare a contract management plan
using Form 49 in Schedule 2 and forward a copy to the to the procurement and disposal unit for
purposes of monitoring.
(4) In cases where the contract manager or user department has any reservation or difficulty with
the terms or conditions of the contract, the contract manager shall discuss and resolve the
reservation or difficulty with the procurement and disposal unit.
(1) A procuring and disposing entity shall clearly state in the contract, the documents
against which each payment shall be made.
(a) The delivery or receipt of the works, services or supplies in accordance with the terms
of the contract;
(b) The content of the consignments delivered;
(f) Payment of costs specified in a contract, such as duties, levies or taxes that may be due
and payable by a provider on the delivered items;
(l) The actual sums paid for reimbursable costs, such as air tickets.
(3) A payment request from a provider shall require an original invoice from the
provider certifying the payment due.
(a) Be in a format provided by the Authority which shall be included in the bidding
documents.
(b) Be in a form and from an institution that is acceptable to the Bank of Uganda;
(c) Be valid for a prescribed period beyond the expected final date of completion of a
contract or expected release date; and
(d) Where appropriate, allow for the progressive reduction of the secured sum, where a
successive payment is released against the secured sum.
(5) The period in sub regulation (4) (c) shall be determined considering the circumstances of
a procurement requirement and the likelihood of extensions or delays to the final
completion date.
(6) The validity period for a payment security for procurement for works shall be for three
(3) to six (6) months after the final expected transaction date.
(7) The validity period for a payment security for procurement for services or supplies shall
be for one to three (1-3) months after the final expected transaction date.
(8) A payment security shall be released by a procuring and disposing entity upon the expiry
of the term of the security or upon the reduction of the secured sum to zero, whichever is
later.
(9) The proposed release of a payment security shall be communicated to a provider and
returned in accordance with the instructions of the provider.
Section 2 (1) PPDPA Act provides that the Act applies to—
Section 2 (1a) PPDPA outlines the activities by a procuring and disposing entity that are exempt
from the Act, and these are—
a) a Ministry of Government;
c) a body established by an Act of Parliament, which receives public finances from the
Consolidated Fund;
d) a company registered under the Companies Act in which Government or a
procurement and disposing entity—
ii. is entitled to cast, or controls the casting of more than fifty percent of the
maximum number of votes that may be cast at a general meeting of the
company; or
iii. controls more than fifty percent of the issued share capital of the company,
Section 3 of the Public Procurement and Disposal of Public Assets Act 2003 (PPDA act)
which defines a “procuring and disposing entity” to mean inter alia (a) a Ministry or
department of Government; (b) a district council or a municipal council; (c) a body corporate
established under an Act of Parliament other than the Companies Act;
Section 3 of the Public Procurement and Disposal of Public Assets Act 2003 defines
“procurement” as the acquisition by purchase, rental, lease, hire purchase, license, tenancy,
franchise, or any other contractual means, of any type of works, services or supplies or any
combination; And “Procurement process” as the successive stages in the procurement cycle
including planning, choice of procedure, measures to solicit offers from bidders, examination
and evaluation of those offers, award of contract, and contract management.
It also defines disposal means the divestiture of public assets, including intellectual and
proprietary rights and goodwill, and any other rights of a procuring and disposing entity by any
means including sale, rental, lease franchise, auction, or any combination however classified
other than those regulated by the Public Reform Enterprise Reform and Divestiture statute, 1993.
And disposal process means the successive stages in the disposal cycle, including planning,
choice of procedure, measures to solicit from bidders, examination and evaluation of those offers
and award of the contract.
The procurement process must be in conformity with the procurement principles laid out in
section 43 of the PPDA Act, 2003 and in sections 44-49. These principles include non-
discrimination, transparency, accountability and fairness, maximization of competition and
ensuring value for money, confidentiality, economy and efficiency and ethics.
Procurement process
The procurement process provided for under the PPDA Act is mandatory and this was
emphasized in Galleria in Africa Limited Vs. Uganda Electricity Distribution Company
Limited, Civil Appeal No. 08 of 2017(SC), the court therefore found the provisions of the Act to
be mandatory and not merely directory stating that procurement and disposal activities are
processes, and one cannot move to another stage without fulfilling the first one. Justice
Mwondha stated that failure to comply with the provisions of the PPDA Act makes the
proceedings fatal and the result of such a process null and void.
Procuring and disposal planning is provided for under Section 58 of the Act. Subsection 1
provides that a procuring and disposing entity shall in each financial year, by a date determined
by the Secretary to the Treasury, prepare and submit to the Secretary to the Treasury and to the
Authority, its annual procurement plan for the following financial year. This must be in
accordance with the budget preparation procedures issued by the Minister
Section 58(3) of the Act provides that the Authority shall issue guidelines in respect of the
format of the procurement plan to be prepared under this section.
Section 58(4) of the Act stipulates that a procuring and disposing entity shall, on a quarterly
basis and in any other case, wherever necessary, review and update its procurement plan.
A procuring and disposing entity shall notify the Secretary to the Treasury and the Authority of
any changes made to its procurement plan and submit the updated and approved plan to the
Authority – Section 58(5) of the PPDPA Act.
Section 58(7) of the Act provides that Procurement shall not be carried out outside the
procurement plan except in cases of emergency situations.
The Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities)
Regulations, 2014 SI No7 of 2014 provides for Annual procurement plan of procuring and
disposing entity.
Regulation 3(1) provides that the procurement and disposal unit shall for each financial year,
prepare an annual procurement plan for the procuring and disposing entity using the procurement
plans of the user departments. Regulation 3(2) provides that for the purposes of sub regulation
(1), a user department shall, based on the approved budget of the procuring and disposing entity,
prepare the procurement plan for the user department, and submit it to the procurement and
disposing unit.
Regulation 3(3) A user department shall promptly notify the procurement and disposal unit of
any change in the procurement plan of the user department.
Regulation 3(4) provides that the annual procurement plan and any updates to it shall be
approved by the Contracts Committee.
Regulation 4 Provides for the Contents of annual procurement plan. The annual procurement
plan of a procuring and disposing entity shall state—
b) the contract packages of the works, services and supplies to be procured and the
estimated cost of each package;
e) the works, services and supplies to be used in common by the procuring and disposing
entity with another procuring and disposing entity;
f) the resources required for the procurement, supported by a schedule of the projected
funding; (g) the recommended method of procurement for each contract package and the
time estimated for each stage of procurement; and
g) the type of contract recommended for each requirement and where applicable, the
requirement for deviation from the use of the standard bidding documents.
PROCUREMENT PROCESS
Section 3 of the PPDPA Act defines a user department as any department, division, branch or
section of the procuring and disposing entity, which initiates procurement and disposal
requirements and is the user of the requirements
Under section 59 (1) of the PPDPA Act, all procurement or disposal requirements should be
documented prior to the commencement of any procurement or disposal proceedings.
Section 59 (2) & (3) of the PPDPA Act provides that upon confirmation that funding, in the full
amount over the required period, is available at the time the contract commitment is made, the
user department initiates the procurement requirements and it is approved by the Accounting
Officer.
Regulation 4 (1) & (3) of the Public Procurement and Disposal of Public Assets (Rules and
Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations,
2014 provides that; A procuring and disposing entity shall not initiate any procurement for which
funds are not available or adequate; and the accounting officer or an officer authorized by the
accounting officer shall confirm the availability of funds.
Section 26(4) of PPDA Act provides that prior to the commencement of a procurement process
an Accounting Officer shall undertake an assessment of the market price of the supplies, services
or of the unit costs of the works in respect of which the procurement is to be made by a procuring
and disposing entity.
2. The user department sends the requisition to the Procurement and Disposal Unit.
Section 31 of the PPDPA Act provides that the procurement and disposal unit then prepare
solicitation documents, renew specifications and recommend procurement method.
Section 62 of the PPDPA Act is to the effect that entities are to use standard documents
provided by the authority for drafting all solicitations for each procurement.
Section 79(1) (a) provides that a procuring and disposing entity shall in respect of the
procurement of goods, works and non-consulting services, use any of the methods in sections 80,
81, 82, 83, 84, 85 and 86 and the conditions for their use specified in the Fourth Schedule to this
Act.
At this stage the procurement and disposal unit also nominate and recommends the Evaluation
Committee as per section 37(2) of the PPDPA Act.
3. Submission to the contracts committee;
The requisition is then submitted to the contracts committee for approval. Section 28(c) of the
Act provides for approval of bidding and contracts documents.
The contracts committee under Section 28(d) and 79(2) of the PPDPA Act then approves the
recommended procurement or disposal method and the Evaluation committee.
In Clear Channel Independent (U) Ltd v Public Procurement and Disposal of Public Assets
Authority Misc. App No. 2008/380 [2009] UGHC 180, court stated that in determination of the
method, the committee uses the contract price in accordance with the PPDPA Guidelines under
section 43-53 on the subject of Thresholds for procurement methods.
The bid notices are placed in newspapers of wide circulation and standard solicitation documents
are issued by the Procurement and Disposal Unit; this may be at a fee.
Section 31 (j) of the Act gives the responsibility of preparing advertisements of bid
opportunities to the Procurement and Disposal Unit.
Under regulation 42 (1) of the PPDA (Rules and methods of procurement and supplies,
works and non-consultancy services) regulations 2014 provides that they publish in at least
one newspaper of wide circulation.
R 42(2) provides that they also display on the website of the Authority from the day of issuance
until the deadline of submission.
Bids are received and opened by the Procurement and Disposal Unit as provided for by Section
32(f) of the Act. Regulation 65 (1) of the PPDPA (Rules and Methods for procurement of
Supplies, works and non-consultancy Services) Regulations No. 8 of 2014 provides that the
public opening of bids is managed by the Procurement and Disposal Unit and witnessed by a
member of the contracts committee or a nominee of the user department.
The procurement website gives the timelines to submit the bids depending on the bidding
contract.
Once bids are opened, they are evaluated by the Evaluation Committee appointed by the
contracts committee. Section 71 of the Act is to the effect that evaluation method used is
dependent on the type, value and complexity of the procurement or disposal. Regulation 5 of
the PPDPA (Evaluation) Regulations, 2014 is to the effect that the time periods for evaluation
are as follows;
20 working days from the date of opening the bids, for evaluation of bids for procurement of
supplies or non-consultancy services.
40 working days for the date of opening, for evaluation of bids for works that is;
7. Award of contract.
After evaluation and any negotiation process, a procurement and disposal unit shall then submit
to the contracts committee, a recommendation to award a contract. The contracts committee shall
consider the recommendation and make a decision to award the contract. An award of contract
by the contracts committee shall not be a contract binding a procuring and disposing entity to a
provider. Regulation 3 (1) of Public Procurement and Disposal of Public Assets (Contracts)
Regulations, 2014.
Under Section 52 of the PPDPA Act, a contract shall be awarded to the bidder with the best
evaluated offer ascertained on the basis of the methodology and criteria detailed in the bidding
documents
Under Regulation 4(1) of Public Procurement and Disposal of Public Assets (Contracts)
Regulations, 2014, A procuring and disposing entity shall, within five working days after the
decision of the contracts committee to award a contract—
a. deliver a copy of the notice of best evaluated bidder to all bidders who participated in the
bidding process;
b. display a notice of best evaluated bidder on the notice board of the procuring and
disposing entity; and
c. send a copy of the notice of best evaluated bidder to the Authority for publication on the
website of the Authority.
However, a notice of best evaluated bidder shall not amount to a contract. - Regulation 4(2) of
Public Procurement and Disposal of Public Assets (Contracts) Regulations, 2014.
Under Regulation 5(1) of Public Procurement and Disposal of Public Assets (Contracts)
Regulations, 2014, a procuring and disposing entity shall not take any action on the contract
award until the lapse of ten days after the date of display of the notice of the best evaluated
bidder under regulation 4.
Under Section 76 (2) PPDA Act, an award shall not be confirmed by a procuring and disposing
entity until the period specified by regulations made under the Act has lapsed and funding has
been committed in the full amount over the required period.
2. the accounting officer confirms that the contract price is not higher than the market price
established prior to the commencement of the procurement process;
3. the period specified in regulation 5 expires, following the notice of best evaluated bidder;
4. the accounting officer confirms that the procurement is not subject to any administrative
review;
5. the full amount of the funding for the period of the proposed contract is committed; and
6. all relevant agencies, including, the Attorney General make the necessary approval of the
contract.
Under Regulation of the PPDA (Contracts) Regulations 51(1) of the PPDPA Act, the
accounting officer or a person appointed by the accounting officer from the user department,
shall manage the contract.
The procurement and disposal unit shall provide a copy of the contract to the person appointed
by the accounting officer to manage the contract. Regulation 51(2) of the PPDPA Act.
Upon receipt of a contract, the contract manager shall prepare a contract management plan using
Form 49 in Schedule 2, and forward a copy to the to the procurement and disposal unit for
purposes of monitoring – section 51(3) of the PPDPA Act.
Regulation 53(3) (g) of the PPDPA (Contracts) Regulations, 2014 is to the effect that
contracts manager shall submit to the accounting officer and the procurement and disposal unit a
monthly report on the progress of the contract.
Learning Outcome 3: Appreciate the functions and powers of various offices/persons in the
public procurement and disposal process
According to Section 3 of the Public Procurement and Disposal of Public Assets Act lays out
definitions of the units such as user departments unit, Procurement and Disposal Unit, contract
committee and evaluation committee.
A. User Departments.
According to Section 3 of the Public Procurement and Disposal of Public Assets Act defines
user department to mean any department, division, branch of the section of the procuring and
disposing entity, including any project unit working under the authority of the procuring and
disposal requirements and is the user of the requirements.
As seen under section 34 of the Public Procurement and Disposal of Public Assets of 2003, it
provides for functions of user department including;
(a) liaise with and assist the Procurement and Disposal Unit throughout the procurement or
disposal process to the point of contract placement;
(b) initiate procurement and disposal requirements and forward them to the Procurement and
Disposal Unit;
(c) propose technical inputs to statements of requirements for procurement requirements to the
Procurement and Disposal Unit;
(d) propose technical specifications to the Procurement and Disposal Unit when necessary;
(e) input with technical evaluation of bids received as required by the Procurement and Disposal
Unit;
(g) report any departure from the terms and conditions of an awarded contract to the
Procurement and Disposal Unit;
(h) forward details of any required contract amendments to the Procurement and Disposal Unit
for action;
(i) maintain and archive records of contracts management
(j) prepare any reports required for submission to the Procurement and Disposal Unit, the
Committee or the Accounting Officer.
Section 3 of the Public Procurement and Disposal of Public Assets defines Procurement and
Disposal Unit to mean division in each procuring and disposing entity responsible for the
execution of the procurement and disposal functions. Section 24(c) of the Public Procurement
and Disposal of Public Assets also provides for the existence of Procurement and Disposal Unit.
The procurement and Disposal Unit’s overall functions is to manage all procurements and
disposal activities of the Procuring and Disposing Entity, working in conjunction with the User
Departments and seeking approval of Contracts Committee where appropriate. The Procurement
and Disposal Unit’s full functions and powers are given. (Part III. Section 30-32 of the Act:
Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities)
Regulations, 2014, Regulation 19), others include
(a) manage all procurement or disposal activities of the procuring and disposing entity except
adjudication and the award of contracts;
(d) liaise directly with the Authority on matters within its jurisdiction;
(f) plan the procurement and disposal activities of the procuring and disposing entity;
(n) issue approved contract documents; 39 Public Procurement and Disposal of Public Assets
Act 1 of 2003
(o) maintain and archive records of the procurement and disposal process;
(q) co-ordinate the procurement and disposal activities of all the departments of the procuring
and disposing entity; (r) prepare any other such reports as may be required from time to time.
B. Accounting officer.
According to Section 3 of the Public Procurement and Disposal of Public Assets defines
accounting officer as
(b) a person appointed under an Act of Parliament or under an instrument of appointment made
under an Act of Parliament, including the Companies Act, to perform the functions of
Accounting Officer of a procuring and disposing entity; or
(c) a person appointed to perform the functions of Accounting Officer of an entity not being of
Government, to which section 2(1)(d) applies.
Section 26 of the Public Procurement and Disposal of Public Assets provides that the
Accounting officer has the overall responsibility for the execution of the procurement and
disposal process in the process in the procuring and disposing entity including
(b) appointing the members of a Contracts Committee specified in the Third Schedule;
(c) causing to be established a Procurement and Disposal Unit staffed at an appropriate level;
(d) advertising bid opportunities;
(f) certifying the availability of funds to support the procurement or disposal activities;
(g) signing contracts for procurement or disposal activities on behalf of the procuring and
disposing entity;
(h) investigating complaints by providers; 34 Act 1 of 2003] Public Procurement and Disposal of
Public Assets (i) submitting a copy of any complaints and reports of the findings to the
Authority; and (j) ensuring that the implementation of the awarded contract is in accordance with
the terms and conditions of the award.
For any procurement process to be started there should be a signed confirmation and approval
from the authorized officials that funds will be available for purchase. Procurement requirement
must be initiated using form 5, which requires signatures to confirm the availability of funds and
give approval for procurement to proceed. According to section 59 of the Public Procurement
and Disposal of Public Assets and Regulation 3 and 4 of the
Public Procurement and Disposal of Public Assets (Rules and Methods for procurement of
supplies, Works and Non- Consultancy Services) Regulation 2014
At this stage the Accounting officer confirms the availability of funds for any procurement
activity, ensures that procurement planning is conducted and integrated with the budgeting
process, commits funds for procurement contracts and authorizes payments.
C. Contract committee;
Section 3 of the Public Procurement and Disposal of Public Assets defines contracts
committee as the committee provided for under Part III of this Act.
The Contracts Committee’s main responsibility is to ensure that procurement and disposal
activities are conducted in compliance with the Act and Regulation provided for under Section
28 of the Public Procurement and Disposal of Public Assets of 2003. This is done by approving
or rejecting recommendations from the Procurement and Disposal Unit at key stages throughout
the procurement or disposal process. Other functions under the said section include (1) A
Contracts Committee shall be responsible for—
(a) adjudication of recommendations from the Procurement and Disposal Unit and award of
contracts;
(bb) ensuring that before it is approved, a procurement is in accordance with the procurement
plan;
(ca) the following activities, for the purposes of disposal of the public assets of a procuring and
disposing entity—
(i) assessing and verifying the public assets identified by a user department or by the Board of
Survey for disposal; (ii) causing the assets identified under subparagraph (i) to be valued in
accordance with regulations made under this Act; and Section 37 Public Procurement and
Disposal of Public Assets Act 1 of 2003
(ii) approving the reserve price for the public assets to be disposed of;
(d) approving procurement and disposal procedures; (e) ensuring that best practices in relation to
procurement and disposal are strictly adhered to by procuring and disposing entities;
(g) liaising directly with the Authority on matters within its jurisdiction.
D. Evaluation Committee.
According to section 24(e) of the Public Procurement and Disposal of Public Assets Act
provides for an evaluation committee.
According to section 71 of the Public Procurement and Disposal of Public Assets Act provides
for evaluation. Evaluation is the process by which the best evaluated bidder is selected for a
word of contract from among all the bids received. The evaluation process has to be conducted
within 40 working days for works, supplies and non- consultancy services, from the date of
opening bids.
Section 71 (1) of the Public Procurement and Disposal of Public Assets Act. The choice of an
evaluation methodology shall be determined by the type, value and complexity of the
procurement or disposal.
As stipulated under Section 37 of the Public Procurement and Disposal of Public Assets Act
proves that all evaluations shall be conducted by an Evaluation Committee, which shall report to
the Procurement and Disposal Unit.
In Conclusion, user departments units, procurement and disposal units and evaluation committee
are the offices under procurement and their roles have been concurrently stated above as
involving multiples roles which have a distinct and, in some instances, similar and all aim at
performing the task with conformity to the procurement principles.
Learning Outcome 4: Apply principles in the PPDPA Act and initiate a public procurement
process and disposal process. (Procurement process discussed in 2 above. This LO discusses
disposal)
Disposal Process
i) “disposal” means the divestiture of public assets, including intellectual and proprietary rights
and goodwill, and any other rights of a procuring and disposing entity by any means, including
sale, rental, lease, franchise, auction, or any combination however classified other than those
regulated by the Public Enterprise Reform and Divestiture Statute, 1993
ii) “disposal process” means the successive stages in the disposal cycle, including planning,
choice of procedure, measures to solicit offers from bidders, examination and evaluation of those
offers and award of contract;
Section 87 of the PPDA Act: (a) public auction; (b) public bidding; (c) direct negotiations; (d)
sale to public officers; (e) destruction of the assets; (f) conversion or classification of assets
into another form for disposal by sale; (g) trade-in; (ga) electronic auctioning; (h) transfer to
another procuring and disposing entity; and (i) donation
S. 87 (2) of the PPDA Act; the procedures for the methods in subsection (1) shall be prescribed
by regulations made under this Act.
1) Planning Phase
Identification of assets to dispose: regn. 2 (1) of the PPDA (Disposal of Public Assets) Regns
2014; an accounting officer shall cause the public assets of the procuring and disposing entity to
be reviewed, to identify the public assets to be disposed of in the follow in financial year.
Reg. 2(2) - a procuring and disposing entity may use the Board of survey or user department to
identify the public assets to be disposed of.
Reg. 3(2) - a user dept may initiate a process to disposal of public assets where the board of
survey recommends for the disposal of a public asset.
Reg. 3(3) - A user dept. Or appropriate dept. of a procuring and disposing entity that is
responsible for the management of public assets shall clearly indicate the public asset to be
disposed of.
Reg. 3 (4) - Approval of disposal process by accounting officer prior to commencement of the
disposal process.
Preparation of bidding documents provided under the various methods under reg. 5, 6, 7, 8 etc of
the PPDA (Disposal of Public Assets) Regns 2014;
3) Valuation of Assets phase; Reg. 23 (1), a procuring and disposing entity shall obtain a
valuation for a public asset prior to the commencement of disposal proceedings.
Valuation shall be obtained from a competent authority where rwquired by law ii) a competent
authority or probider in accordance with the Act where there is no requirement for valuation
under the relevant laws.
The Contracts Committee approves disposal method, bidding documents and evaluation
committee.
Section 28 (d) of PPDA Act: the Contracts Committee approves disposal procedures.
Section 29 of PPDA Act: Power of Contracts Committee to authorise the choice of procurement
and disposal procedure
Reg. 5 - rules to disposal of public assets by public bidding. Reg. 5(1) the PDU shall make a
request to the Contracts Committee for the use of the public bidding method using Form 29 in
the Schedule.
Regns. 7, 10, 12, 14, 16, 18, 20 rules for use of other methodd of disposal of public assets ie how
the PDU can request for use of these methods and seek for approval of the same.
reg. 24 (1) - The Procuring and disposing entity shall in the invitation notice to thw public and
the bidding documents give a description of a public asset to be disposed of including pictures of
the asset, size of the asset, encumbrance on the assets etc.
reg. 26 (1) on submission of bids: a written bid shall be submitted in a plain outer envelope
which shall be sealed securely in such a manner that opening and resealing of the envelope can
not be achieved undetected.
Reg. 29 - methods of receipt of bids; A procuring or disposing entity shall received bids a)
through the staff of the procurement and disposal unit, and issue a receipt in accordance with reg.
30 BL by use of a bid box in accordance with regulation 31.
Reg. 39 (1) - The PPDA (Evaluation) Regulations 2014 shall with necessary modifications apple
to evaluation of bids under these Regulations.
Reg. 40 - Evaluation based on price only is the bidder with the highest price shall be awarded.
Reg. 41 - Evaluation based on price and other factors; the eligibility requirements and
compliance with the other factors, shall be evaluated on a pass and fail basis.
Reg. 42 - submission of evaluation report; i) where disposal of assets is by public auction, the
auctioneer shall within 14 days from the date of the public auction submit the name of the
highest bidder, price of the bids and the proceeds from the public auction, to Accounting
Officer using Form 47 in the Schedule.
Where the disposal method requires submission of written bid, the evaluation committee shall
submit the name of the highest bidder and price of the bid to the Procurement and Disposal
Unit using Form 45 in the Schedule.
8) Contract Management
Contracts committee reviews evaluation report and awards contract in accordance with section
28 and 29 (c) of the PPDA Act.
eg. Regn. 5 (13) of the PPDA (Disposal of Public Assets) Regns. The procuring and disposing
entity may hold negotiations with the successful bidder.
Reg. 5 (14) PPDA where the successful bidder fails to pay the contract pricein accordance with
the terms of the contract, the procuring and disposing entity shall terminator the contract and
man an offer to del to the next highest bidder.
Learning Outcome 5: Enforce rights of aggrieved persons under public procurement and
disposal using dispute resolution mechanisms under the Act
Learning Outcome 5: Enforce the rights of aggrieved persons under the Public Procurement
and disposal process using dispute resolution mechanisms under the Act.
1) Preliminaries
a. Process is Administrative review and involves two steps; (1) Administrative Review
under the Accounting Officer (Sec. 33 of the 2021 Amendment) and Administrative
administrative review shall not apply where entity has entered into a contract. The
(2) (a) (b) of Principal Act and Galleria in Africa Ltd v Uganda Electricity
a. Sec 33(1)/Reg. 4(1) of the PPDPA (Administrative Review) Regs – a bidder aggrieved
by procurement and disposing entity’s decision may make a complaint to the AO.
b. Sec 33(3)(b) – complaint made within 10 working days from after the date the bidder
first becomes aware or ought to have become aware of the circumstances that give rise to
the complaint.
c. Sec 33(5), on receiving complaint, the AO shall immediately suspend the procurement or
disposal process as the case may be. Additionally, the AO shall request bidders to extend
the period of the bid validity and bid security for the duration of the suspension.
d. Sec 33(7) AO shall within 10 days make and communicate the decision in writing
addressed to complaining bidder and shall indicate reasons for the decision and the
investigating a complaint.
HELD: The 10 days under Sec 33(7) are not working days. A decision issued out of
stipulated time is a blatant breach of the law and no decision at all. Sec 33(5) and sec 33(6)
above were held to be mandatory provisions breach of which nullified the entire process.
FORM OF APPLICATION.
application shall be in writing. See Reg 4(2) of the Administrative Review on what
ii) Payment of fees – Reg 11(1) provides for fees to be paid to a procuring and disposing
entity for the administrative review. Fees are provided in the Schedule to the
Regulations.
There are two ways of accessing the Tribunals. One directly under Sec 38 (c) and secondly as a
means of appeal from the decision or indecision of the AO under Sec 38(a) and (b).
Sections 38(a) and (b) were distinguished in VCON Construction Ltd v Makerere University
above. Under Sec 38(a), you must be a bidder. Therefore where for instance the bidding process
Procedure
The application shall be made within 10 days where you are appealing from decision in Sec
33(7).
Where application is made under Sec 33(8) (where AO does not make a decision or you are not
satisfied with one made) and under Sec 33 (9) (where bidder believes that AO has a conflict of
interest or that the matter cannot be handled impartially by AO) application shall be made within
10 days.
ii. Decision
Also See Section 91K of the Principal Act on the powers of the tribunal.
iii. Form
(Procedure) Regs 2016. See Reg 6 on what is contained in application and how
application is to be submitted.
- Fees
Administrative Review Fees under Regulation 11(1) and Schedule to the
300,000