KAMPALA —The Commercial Division of the High Court has ruled in favour of Engaano Millers Limited in a debt recovery case against Hotloaf Bakery Limited, ordering the bakery to pay UGX 82,012,600 as an outstanding balance arising from a supply agreement for wheat flour.
In a judgment delivered on June 19, 2025, Hon. Lady Justice Patience Rubagumya dismissed Hotloaf Bakery’s application for leave to defend the suit, citing the bakery’s admission of debt and absence of any triable issue.
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Engaano Millers had filed Civil Suit No. 293 of 2025 under summary procedure, seeking to recover UGX 92,012,600 from Hotloaf Bakery. The debt stemmed from a contract executed on December 5, 2018, in which Engaano Millers supplied drum wheat flour to the bakery.
Hotloaf Bakery, in its defense, admitted receiving the flour and acknowledged its indebtedness, but argued that it had already paid UGX 20 million, reducing the outstanding amount to UGX 82 million. It requested to be granted permission to defend the suit and proposed to pay the debt in weekly installments of UGX 5 million, citing financial hardships.
“We have not refused to pay,” said Mr. Kodawa Mutano, Managing Director of Hotloaf Bakery, in an affidavit. “The business faced operational challenges. We’re committed to settling the outstanding UGX 82,012,600.”
Engaano Millers’ accountant, Mr. Naluswa Roy Jacob, opposed the application, insisting that Hotloaf had no plausible defense.
“The Applicant has already made part payments Their indebtedness is clear, and no legal issues warranting a trial have been raised ,” he noted.
After reviewing the parties’ affidavits and submissions, Justice Rubagumya found no triable issues of law or fact that would justify a full trial.
“The outstanding amount of UGX 82,012,600 is not contested by the Applicant,” the judge ruled. “The Applicant has not raised any triable issue for determination by the Court to warrant granting leave to appear and defend the suit.”
She emphasized that summary procedure is intended for “clear and straightforward cases where the demand is liquidated and there are no issues for determination by the Court except for the grant of the claim.”
The court further held that the Applicant’s admission of debt and willingness to pay in installments did not amount to a valid legal defense. “An application for leave to defend must raise a bona fide triable issue. In this case, it does not,” Justice Rubagumya added.
Consequently, the court entered judgment in favor of Engaano Millers and awarded them interest and legal costs.
“I hereby award interest at the rate of 6% per annum on the decretal sum from the date of judgment until payment in full,” Justice Rubagumya ordered. “The Respondent/Plaintiff is also awarded the costs of this application and the suit.”
This ruling reinforces the position that admissions of debt, without disputing the underlying obligation or raising legal questions, are insufficient grounds to contest summary suits.
Hotloaf Bakery must now pay UGX 82 million plus interest and legal costs failing which, the company could face enforcement proceedings to recover the sums owed.
