BY THE OBSERVER
There seems to be no end in sight in the protracted legal battle between businessman Hamis Kiggundu and Diamond Trust Bank (DTB).
The two parties have been in court for the past three years in a multi-billion case. Kiggundu won in the High court but the Court of Appeal sided with DTB. On June 13, 2023 the Supreme court ordered for the case to be retried at the High court, thereby returning the case back to square one.
In his lead judgment, Chief Justice Afonse Owiny-Dollo addressed the sticking issue the syndicated credit- facility executed between the DTB- Kenya and Ham as lawful.
“The issue of illegality having been resolved in this appeal, High Court Civil Suit No. 43 of 2020, between the parties hereto, which was the genesis of the appeal to the Court of Appeal, and ultimately to this Court, is remitted back to the High Court for trial before another judge; basing only on issues of fact arising from the pleadings,” he noted.
What this means is that High court will hear afresh the case in which Kiggundu, through Muwema & Co Advocates and Kimara Advocates, jointly sued Diamond Trust Bank- Uganda (DTB-U) and DTB-K for unlawfully making deductions of Shs 120bn while servicing a loan from the duo. He also accused DTB-Kenya of perpetrating illegalities during the process of acquiring the loan.
The High court in 2020 ruled in favour of Kiggundu on grounds that the the facilities extended by DTB-Kenya to Kiggundu were illegal and hence unenforceable for the reason that the DTB-Kenya had no license from Bank of Uganda to conduct financial institutions business in Uganda.
The court, however, did not address the other issue of Kiggundu’s claim of unlawful deductions. However, the Court of Appeal overturned the High court trial ruling on grounds that the trial judge erred in law and in fact in striking out the written statement of defense of DTB- Kenya whereas there was no challenge to it.
High court was also faulted for entering judgment for Kiggundu as prayed for in his joint plaint. Incidentally, the Court of Appeal omitted to address the issue of illegality that was decided by the High court.
Kiggundu appealed to the Supreme court on grounds that the Court of Appeal avoided to adjudicate the substantial question of illegality, which was the basis of the DTB’s appeal before them.
HAM WINS GROUND 1
At the Supreme court, Kiggundu raised seven grounds of appeal but Owiny-Dollo chose to address the two principal ones; whether it was right for the Court of Appeal not to address the illegality issue and whether the process was illegal or not.
In his judgment, Owiny-Dollo ruled that the Court of Appeal ought to have addressed and determined the issue of illegality of the credit facilities, which was raised before it.
“Therefore, in declining to pronounce itself on the issue of illegality of the impugned transactions between the disputants, which was the crux of the appeal before it, and instead striking out the amended plaint for the reasons it has given, I find with the greatest respect to the Court of Appeal that it erred in law in doing so. Wherefore, I find that ground 1 of this appeal succeeds.”
DTB WINS GROUND 2
However, Owiny-Dollo ruled that no law was cited or brought to the attention of the Supreme court, which forbids the creation of the impugned syndicated agency relationship entered into by the DTB-Uganda and DTB-Kenya.
“Similarly, no law was brought to this court’s attention that forbids foreign financial institutions from extending credit facilities to any financial institution or person in Uganda,” he ruled.
STAGE SET FOR ANOTHER EPIC
Now that the issue of illegality has been addressed, the battle now shifts to the original ground of Kiggundu’s plaint of unlawful deductions. From the look of things, given the magnitude of what is at stake, the legal battle looks set to also end up at the Supreme court.
Do you want to share a story, comment or opinion regarding this story or others, Email us at email@example.com Tel/WhatsApp........0726054858