KAMPALA: The Court of Appeal in Kampala, has this morning, dismissed with costs a multibillion commercial dispute that had been filed against city tycoon, Sudhir Ruparelia by Crane Bank in receivership, ending over a two-year legal battle.
Bank of Uganda (BoU) had appealed against the ruling of Commercial Court head David Wangutusi, who dismissed a multibillion commercial dispute against tycoon Sudhir Ruparelia that had been filed by Crane Bank-in-receivership two years ago.
However in a ruling read by the registrar court of appeal on behalf of the 3 judges led by Justice Owny Dollo the deputy Chief justice, the three judges found no reason to dismiss the case against the respondents Dr Sudhir Ruparelia and Rajiv Ruparelia the Managing director Crane Management services.
The case has been dismissed with costs to be paid by Bank of Uganda.
Dr Sudhir Ruparelia shortly after the victory said this was a big blow to the management of bank Uganda and said that this time to appoint serious people at the Central bank.
While dismissing the Shs397b case against the city tycoon last year 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.
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.