MTN Uganda head officeThe Court of Appeal has upheld MTN Uganda Limited’s liability for wrongful interference with Ezee Money Uganda Limited’s contractual relations, but reduced the damages awarded to the payment services company from Shs2.3 billion to Shs300 million.In a judgment delivered on October 22, 2026, Justice Geoffrey Kiryabwire reduced general damages from Shs800 million to Shs200 million and punitive damages from Shs1.5 billion to Shs100 million. Interest on both sums will run at the court rate from the date of the High Court judgment until payment in full.The dispute arose from Ezee Money’s mobile money platform and its attempts to operate through MTN Uganda’s telecommunications network.Ezee Money had sued MTN, alleging breach of statutory duties under the Uganda Communications Act 2013, causing loss by unlawful means and inducing breach of contract or unlawfully interfering with its contractual relations.The High Court ruled in favour of Ezee Money on November 6, 2015, awarding Shs800 million in general damages and Shs1.5 billion in punitive damages. MTN appealed, challenging both liability and the size of the awards.Ezee Money is a Ugandan company engaged in payment solutions, including mobile money services delivered through mobile telephone networks, the internet and other electronic platforms. MTN is a licensed telecommunications operator that held a dominant position in Uganda’s mobile telecommunications market – a fact recorded as agreed by the parties at the scheduling conference.The dispute arose after Ezee Money sought access to MTN’s network through a short code to be provisioned by Yo! Uganda Limited, a third-party aggregator. MTN declined to connect Ezee Money through Yo! Uganda and instead required the company to negotiate commercial terms directly with MTN. The telco also withdrew Ezee Money’s post-paid telecommunications services, citing the company’s inability to meet credit-vetting requirements as a new business.Ezee Money further claimed that MTN had exclusivity agreements with its mobile money agents that prevented them from providing services to competing platforms. It alleged that some agents who continued working with other operators were harassed and had their equipment confiscated.Ezee Money argued that MTN’s conduct breached its statutory duties under Sections 53(1) and 56 of the Uganda Communications Act 2013, caused loss through unlawful means and amounted to unlawful interference with its contractual relations.MTN challenged the High Court decision on 10 grounds. Among others, it argued that Ezee Money had filed suit before exhausting remedies provided under the Uganda Communications Act. It said Ezee Money should first have lodged a complaint with the Uganda Communications Commission under Section 55(2) of the Act, with provision for appeal to the Communications Tribunal under Section 55(9).It also challenged the High Court’s finding that it owed Ezee Money a duty under Section 53 not to unfairly restrict competition, disputing that Ezee Money’s activities constituted communication services.Areina Mugara and Bonny Kolokolo Ntanda of Kampala Associated Advocates represented MTN, while Brian Kalule of AF Mpanga Advocates represented Ezee Money.Exhaustion of RemediesMTN’s lawyers argued the case was prematurely filed because Ezee Money had not used the complaint and appeal procedures under the Act.Ezee Money’s lawyers opposed the argument, saying the High Court had considered and rejected the preliminary point, which was raised late – during submissions in reply – after the case had been scheduled and heard. They also submitted that the remedies sought were common law remedies that could only be pursued before court.In response, MTN argued that describing the claim as a common law action departed from Ezee Money’s pleadings, which expressly referred to breach of statutory duties.Justice Kiryabwire found that the claim was not limited to a statutory action and included both statutory and common law causes of action.“The above notwithstanding, I am persuaded by the reasoning of Counsel for the Respondent that the causes of action as pleaded were not confined to a statutory action under the Uganda Communications Act, 2013,” the judge said.“Accordingly, while I accept that the trial Judge ought to have more clearly addressed the preliminary point of law and the applicability of the exhaustion doctrine, I find that it would not have been proper to dismiss the entire suit on that basis alone, given the mix of statutory and common law causes of action.”No Statutory DutyThe Court of Appeal, however, disagreed with the High Court’s conclusion that Ezee Money’s activities constituted communication services under the Uganda Communications Act. The court considered Regulation 6 of the Communications (Fair Competition) Regulations 2005, but said the provision had to be read together with the parent Act and its definitions.“I therefore find that the learned trial Judge erred in holding that the Respondent’s activities constituted communication services within the meaning of the Uganda Communications Act, 2013 and consequently erred in holding that the Appellant owed the Respondent a duty under Section 53(1) of the Act,” Justice Kiryabwire said.The finding meant that Ezee Money’s claim for general damages based on breach of statutory duty could not stand to that extent.Dominant PositionOn MTN’s dominant position, the company argued that Ezee Money could not rely on estoppel because there was no evidence that MTN had caused the company to believe it held a dominant position or that Ezee Money had acted on such belief.The court rejected the argument, finding that MTN had agreed in the joint scheduling memorandum that it was in a dominant position.“To my mind the Respondent cannot rely on the definition of estoppel with regard to dominant position… I find that notwithstanding that the Appellant through counsel agreed in the joint scheduling memorandum that the Appellant was in a dominant position, this was a pre-trial position that still had to be tested during trial. Accordingly, I find that the trial Judge was correct to hold the Appellant bound by the agreed fact of dominant position,” the judge said.Liability Upheld, Damages ReducedDespite overturning the statutory-duty finding, the Court of Appeal upheld MTN’s liability for wrongful interference with contractual relations, describing it as an independent common law cause of action. The court said evidence showed MTN’s conduct had caused substantial harm to Ezee Money’s business, including a 79% drop in transactions, inactivation of 65% of service centres, disruption following termination of the aggregation agreement with Yo! Uganda Limited and reputational harm to the newly established company.“I have found that the Respondent was not engaged in communication services and that the Appellant therefore owed it no statutory duty under Section 53(1) of the Uganda Communications Act, 2013. The claim for general damages based on breach of statutory duty therefore falls by the wayside to that extent. However, I have also found that the Appellant was liable for wrongful interference with contractual relations, which is an independent common law cause of action,” Justice Kiryabwire said.On punitive damages, the court found that MTN’s alleged conduct – harassment of agents, confiscation of property, physical detention and inducement of a third party to breach its commercial arrangement – provided a basis for a deterrent award. However, Justice Kiryabwire found the High Court awards disproportionate to the proven harm, particularly since statutory-duty claims had not been sustained, and noted that detailed financial evidence had not been presented.“Taking into account the nature of the wrongful acts, which included physical harassment of agents, confiscation of their property, physical detention, and inducement of a third party to breach its commercial arrangement, there was indeed a basis for an award of punitive damages to deter such conduct. However, the amounts awarded were disproportionate to the proven harm, particularly where the statutory duty claims have not been sustained,” he said.“Bearing in mind all the circumstances, I would reduce the general damages award to Shs200,000,000 and the punitive damages award to Shs100,000,000, which I in my discretion consider to be adequate compensation and a sufficient deterrent.”The court therefore partly allowed MTN’s appeal, upholding liability for wrongful interference with contractual relations and reducing total damages to Shs300 million.The judgment stated: “The Appellant admitted in law that it was in a dominant position to the Respondent. The finding of liability for wrongful interference with contractual relations under common law is upheld.”“Ground 9 partially succeeds. The award of general damages is reduced from Shs800,000,000 to Shs200,000,000. The award of punitive damages is reduced from Shs1,500,000,000 to Shs100,000,000. Interest on both sums shall run at court rate from the date of the High Court judgment until payment in full.”The post Appeal Court Finds MTN Uganda Liable for Interfering with Ezee Money Contracts, But Cuts Damages to Shs300m appeared first on Business Focus.