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Tuesday, January 31, 2023

New Twist as DTB Bank pushes for cancellation of ruling that ordered Shs120bn refund for tycoon Ham Kiggundu

Diamond Trust Bank (DTB) Uganda and DTB Kenya have asked the Court of Appeal to cancel a High Court ruling that ordered for the refund of Shs120bn to tycoon Hamis Kiggundu aka Ham.

In 2020, Justice Henry Peter Adonyo of the Commercial Division of the High Court ordered DTB Uganda to refund over Shs120bn deducted from the tycoon’s accounts as the financial institutions sought to recover syndicated loans (offered by both DTB Kenya and Uganda).

DTB had deducted the monies — in both Shillings and dollars — from Ham Enterprises Ltd and  Kiggs International Ltd, both owned by Ham.

The banks had extended loans to Ham through these two companies between 2011 and 2016.

DTB Kenya and DTB Uganda would later communicate their intentions to take over Ham’s properties over failure to clear Shs39bn in loans and interest payments.

But Ham quickly dismissed claims by DTB that he had failed to clear the loan and interest. He also alleged that the banks had deducted billions in excess from bank accounts of Ham Enterprises Ltd and  Kiggs International Ltd.

But Ham could not get the Shs120bn and its interest of eight per cent — even with Justice Adonyo’s ruling in his hands.

He would need an order — and pray that no counter-order is issued against his.

Thus, DTB’s lawyers Kiryowa Kiwanuka and Usama Sebuufu outsmarted Ham’s led by Fred Muwema of Muwema and Company Advocates by securing an order staying execution of Adonyo’s ruling.

With Principal Judge Flavian Zeija’s order staying execution of Adonyo’s judgement, DTB Kenya and DTB Uganda comfortably proceeded to the Court of Appeal.

Zeija wanted court to determine two thorny issues: Were transactions between Ham Kiggundu (and his companies) and DTB Bank Uganda and DTB Kenya legal or illegal? Are foreign banks like DTB Kenya required to obtain a licence from the central bank before engaging in a deal like the one involving Ham, Ham Enterprises Ltd and  Kiggs International Ltd?

Court of Appeal Battle of Minds

DTB’s Kiwanuka and Sebuufu argued before Court of Appeal Justices Richard Buteera, Kenneth Kakuru and Christopher Izama Madrama that High Court’s Adonyo ignored the question and evidence of  breach of contract, fiduciary and statutory duties.

Sebuufu and Kiwanuka also told the bench that Adonyo did not task Ham, Ham Enterprises Ltd and  Kiggs International Ltd to offer evidence of the claims they made against DTB Kenya and DTB Uganda.

They wondered why Justice Adonyo would want Ham, Ham Enterprises Ltd and  Kiggs International Ltd to benefit from a transaction the companies referred to as an illegality.

For their part, Muwema and Company Advocates (representing Ham, Ham Enterprises Ltd and  Kiggs International Ltd) sought to emphasize their argument that the transaction was an illegality: that DTB Kenya had no license to transact in Uganda.

After the March 17 hearing, Justices Buteera, Kakuru and Izama Madrama will deliver their judgement on a date they promised to notify the parties in the case of.

Pearl Times Reporter
Pearl Times Reporterhttps://pearltimes.co.ug
Latest Uganda news, politics, business, health and entertainment coverage.

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