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BoU ordered to pay legal costs in Crane Bank takeover saga
The building that used to house Crane Bank on Kampala Road. FILE PHTO
What you need to know:
- In their decision on Friday, the Supreme Court justices held that it was BoU that was behind the Shs397b commercial litigation against the businessman and not Crane Bank in receivership, hence they should foot all the legal costs.
The Supreme Court has ordered Bank of Uganda (BoU) to foot all the legal costs involving the multibillion case that Crane Bank in receivership brought against city businessman Sudhir Ruparelia, bringing the five-year litigation to an end.
In their decision on Friday, the Supreme Court justices held that it was BoU that was behind the Shs397b commercial litigation against the businessman and not Crane Bank in receivership, hence they should foot all the legal costs.
The unanimous judgment of the highest court in the land was also to the effect that Crane Bank reverts to the shareholders as of January 20, 2018.
“For avoidance of doubt, the Court of Appeal upheld the finding of the trial court, which ordered that the costs of the suit were to be borne by the Bank of Uganda, since it was Bank of Uganda behind the filing of the suit and other subsequent actions,” ruled the justices of the court.
It added: “That order (of Court of Appeal) shall stand. The implication of that finding, in our view, is that the management of the appellant (Crane Bank in receivership) reverted to the shareholders after January 20, 2018.”
The justices included; Rubby Opio-Aweri, Faith Mwondha, Prof Lillian Tibatemwa, Ezekiel Muhanguzi and Percy Night Tuhaise.
Costs still to be decided
By press time on Friday morning, it was not clear how much money BoU will foot in legal costs right from High Court to Court of Appeal and Supreme Court.
It is, however, estimated to be in billions of shillings, given the magnitude of the case that had dragged on for nearly five years.
“First of all, he (Mr Ruparelia) lost the bank, which should have never happened because of the mistakes of officers at Bank of Uganda. He has had to endure the five years because of this case instead of concentrating on other activities,” Mr Peter Kabatsi, the lead lawyer for Mr Ruparelia, said after yesterday’s ruling.
“He spent all the time prosecuting this case and its extreme expenses. Bank of Uganda, as you heard from court, will have to bear all these expenses, which will be calculated in accordance with the law, the Advocates Remuneration and Taxation Costs as amended,” he added.
Dr Sudhir Ruparelia (Centre) celebrates with his lawyer Peter Kabatsi (Right), and Shamar Kooki (Left) at the Supreme Court in Kampala on February 11, 2022. PHOTO/ISAAC KASAMANI
Also in their decision, the justices faulted the Registrar of the Court for having attempted to endorse the withdrawal of the appeal by the lawyers of BoU before the same court, which process they said was aimed at denying the businessman legal costs.
“This court did not fully hear the instant appeal. The registrar of this court was not an appellant court above the Court of Appeal. It is only a full bench of this court that can reverse a decision of the Court of Appeal. The endorsement of the notice of withdrawal by the registrar of this court had the effect of overturning the decision of the Court of Appeal on the issue of costs, which in our view, was erroneous,” the justices faulted the registrar.
“This, in our view, is conclusive that the appellate was not aggrieved with the decision of the Court of Appeal that upheld in totality the finding of the High Court on the issue of award of costs against Bank of Uganda and since the appellate (Crane Bank in receivership) chose to withdraw her appeal in its entirety, it is evident that the decisions of the Court of Appeal stands and the same cannot callously be overturned by a notice of withdrawal endorsed by the registrar of this court,” they added.
Shortly after the ruling, a jolly Mr Ruparelia said: “I thank the Judiciary that has finally given me justice. Finally, we can say justice has been achieved. It’s over five years ever since this case was filed against us and we have suffered a huge amount of losses concentrating on this case. All I can say, BoU can now go and appeal to God.”
Mr Matthias Katamba, the chief executive officer of dfcu Bank, said he could not ably comment on whether they bought hot air by taking on some assets and liabilities of Crane Bank.
Mr Katamba said he would give an appropriate response once he receives a copy of the Supreme Court decision.
Likewise, Ms Charity Mugumya, the director of communications at BoU, said she could not comment since they had also seen the ruling on social media and had not yet internalised it yet.
