The Commercial Court has ordered the National Water and Sewerage Corporation (NWSC) to pay Shs813.75 million in damages for causing structural damage to a building while conducting maintenance work in Kampala city.
Lady Justice Cornelia Kakooza Sabiiti found NWSC liable for the damage caused to a property owned by Mugalaasi Holding Limited on Namirembe Road.
Mugalaasi had sued both Kampala Capital City Authority (KCCA) and NWSC, accusing them of negligence during excavation works that led to the collapse of a section of their building at Block 12 Plot 213 in Nakivubo, rendering it uninhabitable.
Mugalaasi initially sought a total compensation of Shs 8.1 billion, including Shs245 million for demolition costs, Shs663 million for reconstruction, and Shs7.2 billion for lost rental income and damages.
According to court records, KCCA was overseeing road and drainage upgrade works on Namirembe Hill Road and its back access lane in December 2019. The agency had contracted Abubaker Technical Services and General Supplies Limited for the construction, and NWSC was brought in to upgrade the water and sewer system along the road corridor.
During excavation for pipeline installation and roadworks, Mugalaasi’s building sustained significant damage. An assessment later revealed that the structure was no longer safe for human occupation. As a result, in January 2020, KCCA ordered the demolition of the compromised building.
Feeling aggrieved by the circumstances that led to the destruction of their property, Mugalaasi filed a lawsuit against both KCCA and NWSC, seeking compensation for their losses.
In her ruling, Justice Sabiiti determined that NWSC had been negligent in executing its duties and had failed to exercise reasonable caution, even though the building was old and the corporation was carrying out its statutory obligations.
The court, however, exonerated KCCA from any responsibility in the building’s collapse and held NWSC solely accountable.
While acknowledging the age and prior structural issues of the building, the judge reduced the compensation claims. The reconstruction cost was slashed from Shs663 million to Shs330 million, demolition costs were lowered from Shs245 million to Shs183.75 million, and lost income claims were significantly reduced from Shs7.2 billion to Shs300 million.
Ultimately, the court awarded Shs813.75 million in total compensation, including costs of the suit.
Additionally, special damages of Shs513.75 million will accrue an interest rate of 20 percent per annum, while general damages of Shs300 million will attract an 8 percent interest rate per annum from the date of judgment until full payment is made.
