Court Orders Umeme to Pay Shs 100m Over Unlawful 2012 Power Disconnection

The Court of Appeal in Kampala has overturned a previous High Court ruling, awarding Edroch Plastics Co. Limited Shs 100 million in general damages. The compensation stems from an unlawful and prolonged power disconnection that crippled the company’s manufacturing operations back in 2012.

A panel of three appellate justices ruled that the lower court erred in determining that former electricity distributor Umeme was justified in cutting off the plastic hanger manufacturing factory. The dispute began in July 2012 when Umeme disconnected power to multiple premises following reports of localized electricity theft.

Although subsequent investigations cleared the area and power was restored to other customers, Edroch Plastics remained without its essential three-phase electricity supply until August 2013. Court proceedings revealed that the factory was never implicated in the power theft. Managing director Noah Muwonge testified that despite numerous appeals, Umeme only restored electricity after legal action was initiated.

In 2018, High Court judge Billy Kainamura initially dismissed the firm’s lawsuit, siding with the distributor. However, delivering the lead judgment, Justice Esta Nambayo faulted the High Court, ruling that area-wide reports of theft do not legally justify disconnecting unassociated consumers.

Justice Nambayo emphasized that Umeme acted negligently and breached its contractual duties by failing to reconnect the factory within a reasonable timeframe. Justices Cheborion Barishaki and Musa Ssekaana concurred with the ruling.

While Edroch Plastics had sought Shs 276 million for specific financial losses, the appellate court declined the full amount due to insufficient proof of exact profit losses. Instead, the Shs 100 million general damages award was granted to account for severe business disruption and sustained inconvenience over the thirteen-month outage. Umeme’s distribution concession officially expired in 2025, with operations transitioning to the Uganda Electricity Distribution Company Limited (UEDCL).

Read the full story on The Observer.