Court documents indicate that as an assurance of payment, Mr Muwanga told Mr Barugahara (inset) that he was a director in BMK, thus setting up standing orders by BMK through dfcu Bank. Photo / File
The Commercial Court has ordered the son of the late BMK to pay Youth and Children Affairs Minister Balaam Barugahara Shs1.4 billion which he borrowed but failed to pay.
Mr Haruna Muwanga also known as Haruna Kasule Muwanga who doubles as the director of BMK Uganda was also ordered to pay Mr Barugahara damages of Shs140m and interest at a rate of 6 percent per annum.
Justice Thomas Ocaya observed that Mr Barugahara had proved that Mr Muwanga had failed to meet his contractual obligations in an agreement in which he was required to pay the debt within the agreed six months.
“In this case, [Mr Barugahara ] would not have brought this matter to court had [Mr Muwanga] performed [his] contractual obligation or adhered to demands for payment thereafter. As such, I award [Mr Barugahara ] the costs of the suit,” he ruled, noting that considering all the facts of the case, the plaintiff be awarded an interest at a rate of 6 percent per annum on the contractual amount outstanding from the date of default until the date of filing this suit.
In the case filed before the commercial division of the High Court, Mr Barugahara sued Mr Muwanga over breach of contract and recovery of his money amounting to Shs1.4b.
Background
Mr Barugahara narrated that he was approached by Mr Muwanga in July 2021 for financial support of Shs1.4b, which he agreed to and advanced Shs1b on his account in dfcu Bank on July 29, while Shs400m was advanced in cash and an agreement was entered.
“In the contract, it was agreed that [Mr Muwanga] shall return the money in six months from the date of signing the agreement with Shs1b to be returned by October 30, 2021, and Shs1.3b by January 30, 2022,” court documents show.
Documents further indicate that as an assurance of payment, Mr Muwanga told Mr Barugaharra that he was a director in BMK setting up standing orders by BMK through dfcu Bank in favour of Mr Barugahara and also agreed to handover some cheques to be banked only if the standing orders bounced.
Mr Mwanga later requested Mr Barugahara not to deposit the cheques, promising to pay in cash, and subsequently paid back Shs400m, leaving a balance of Shs1b.
“On January 11, 2022, [Mr Mwanga] … asked for further financial support of Shs400m, and an addendum to the contract was made to that effect. It was agreed … that the Shs1b be returned by March 11, 2022, and Shs1.3b be returned by July 11, 2022,” court documents indicate, noting that Mr Mwanga never paid the money even when Mr Barugahara made several attempts to meet with him, thus leading to the filing of a case on January 18, 2024.
