BoU appeals Sudhir win over Crane Bank case - National | NTV

BoU appeals Sudhir win over Crane Bank case


Wednesday August 28, 2019

Bank of Uganda (BoU) on Tuesday evening said they appealed against the ruling of Commercial Court head David Wangutusi, who dismissed a multibillion commercial dispute against City tycoon, Sudhir Ruparelia that had been filed by Crane Bank-in-receivership two years ago.

According to a press release sent out by the BoU’s director of communications, Charity Mugumya, the Central Bank has vowed to restitute the dismissed commercial dispute and have it prosecuted to its logical conclusion.

"While Hon. Justice David Wangutusi dismissed the Shs397b case against Mr Sudhir on technicality, alleging that Crane Bank-in-receivership lost its powers to 'sue' or to be 'sued' thus rendering its suit a nullity, Crane Bank in receivership maintains that receivership is a management situation and hence no legal change as capacity to sue or to be sued," reads the BoU statement in part.

Adding that, "Bank of Uganda would like reassure the public that it is committed to pursuing this matter to its logical conclusion."

While dismissing the Shs397b case against the city tycoon on Monday, Justice Wangutusi held that once Crane Bank was placed under receivership, it was insulated against legal proceedings according to Section 96 of the Financial Institutions Act and therefore had no powers to sue Mr Ruparelia.

The judge also went ahead and ordered BoU to pay costs that Mr Ruparelia used to successfully to prosecute this matter.

“Interestingly, the Central Bank sold and did away with the respondent (Crane Bank-in-receivership) on 24th 2017, four days after it had been placed under receivership. In my view, after conveying all these assets to dfcu Bank together with the liabilities including deposits, the respondent was left high and dry with no property interest in any of the assets that had originally belonged to it,” ruled Justice Wangutusi.

“In my view, the receivership was exhausted with that transfer and conveyance. The respondent (Crane Bank-in-receivership) therefore, had no locus standi (the right to appear in court) to file any suit claiming any property because it had ceased to exist. Nonetheless, the receivership would have in any case expired by now within 12 months from 24th January 2017,” he added.

“The sum total is that the respondent (Crane Bank-in-receivership), at the time it filed this suit, was not in existence, its life time having been terminated when it was surrendered to dfcu Bank whose consideration was the dfcu assumption of the respondent’s liabilities, which assumption was paid by conveying her assets to dfcu Bank,” the judge further ruled.

According to the statement, BoU says they have already served the notice of appeal to Mr Ruparelia's lawyers; Kampala Associated Advocates (KAA), notifying them about this development.

"Crane Bank-in-receivership is dissatisfied with the decision of the Hon. Justice Wangutusi and has served a copy of the notice of appeal to Kampala Associated Advocates, the legal representatives of Mr Sudhir Ruparelia and Meera Investments Ltd," BoU says in the statement.

On June 30, 2017, Crane Bank in receivership, sued Mr Ruparelia and Meera Investments Ltd for allegedly causing financial loss amounting to Shs397b to Crane Bank in fraudulent transactions and land title transfers.

Crane Bank in receivership had sought court to compel the property mogul to pay back $ 880,000,000, $9,270,170.00, $3,560,000.00, $990,000 and Shs52m.

Mr Ruparelia denied the allegations and counter-sued BoU, seeking compensation of $8m (Shs28b) in damages for breach of contract.