Court Orders Roko to Pay Shs 3.92bn in Construction Dispute

The High Court has ordered Roko Construction Limited to pay USD 1,059,350.84 (Shs 3.92bn) to Mehta Electricals Ltd for unpaid electrical equipment and installation works carried out on several projects.

The dispute stems from sub-contracts awarded in May 2016, when Mehta Electricals Ltd was engaged to undertake electrical installations for three SGS Automobile Uganda Limited sites in Mengo, Masaka and Entebbe at a total contract price of USD 747,735.93 (Shs 2.77bn).

Court heard that although USD 480,342.14 (Shs 1.78bn) was certified as due and payable, only USD 236,152.44 (Shs 873.8m) was paid, leaving a balance of USD 244,189.70 (Shs 903.6m). A joint reconciliation conducted on November 29, 2018 confirmed that the amount was due and owing.

Despite an undertaking to effect payment, Roko Construction did not settle the balance. The parties further agreed on an additional USD 38,010.02 (Shs 140.6m) as unpaid retention fees, bringing the total claim for the sites to USD 282,199.72 (Shs 1.04bn).

Mehta Electricals was also contracted to undertake works at Lotigo Army Venue, where USD 623,471.60 (Shs 2.31bn) was certified as due and payable. Roko paid USD 602,408.31 (Shs 2.23bn), leaving a balance of USD 21,063.29 (Shs 77.9m). The parties later agreed that USD 61,062 (Shs 225.9m) was due, in addition to USD 27,262 (Shs 100.9m) in retention fees, bringing the total claim for the site to USD 48,325.29 (Shs 178.8m).

At the Luthuli site, Mehta Electricals carried out installation works certified at USD 399,034 (Shs 1.48bn). Roko paid USD 180,029.38 (Shs 666.1m), leaving a balance of USD 219,004.63 (Shs 810.3m). Following reconciliation, the parties agreed on an additional USD 14,282.24 (Shs 52.8m) in retention fees, bringing the total claim to USD 233,286.87 (Shs 863.2m).

For the Imperial Botanical Hotel Suites project, USD 3,014,582.79 (Shs 11.15bn) was certified as due and payable. Roko paid USD 2,621,248.26 (Shs 9.70bn), leaving a balance of USD 393,334.53 (Shs 1.46bn). The parties also agreed on an additional USD 186,369.04 (Shs 689.4m), bringing the total claim for the site to USD 579,703.57 (Shs 2.14bn).

Court further noted that USD 120,010.25 (Shs 444.0m) remained pending clarification, which Roko admitted but failed to process through proper certification and payment procedures. The company had also undertaken to finalise Certificate No. 12 amounting to USD 95,713.69 (Shs 354.1m), but did not do so.

In total, Mehta Electricals sued Roko Construction for USD 1,263,526 (Shs 4.68bn) being unpaid dues for electrical supply and installation works across five project sites, together with interest and costs.

In its defence, Roko raised a preliminary objection arguing that the matter should have been referred to arbitration and not determined by court.

The company also disputed performance and certification, alleging that Mehta Electricals failed to complete some works on time and left defects, and that the amounts claimed were not fully certified.

However, the court observed that Roko did not deny the existence of payment certificates but argued that they only confirmed work done, not full payment obligations.

“I also note that in its defence, the defendant does not deny the existence of the payment certificates and avers that in as much as they were issued, they were issued to confirm the work done but not that all the payments therein were to be made,” the court observed.

Ag. Judge Dr. Ginamia Melody Ngwatu held that the court could not award the full sum as pleaded in the plaint but would instead rely on amounts directly attributable to the transactions in issue.

“The counter-claim is dismissed with costs to the counter-defendant. The defendant shall pay the costs of this suit,” the court ruled.

Court ultimately entered judgment in favour of Mehta Electricals Ltd and ordered Roko Construction Limited to pay USD 1,059,350.84 (Shs 3.92bn), together with commercial interest from the date of filing the suit until full payment.