Dfcu to pay Sudhir’s Meera Investment over USD 8.6M in rent arrears - Daily Post Uganda

Dfcu to pay Sudhir’s Meera Investment over USD 8.6M in rent arrears

Dfcu must pay rent arrears estimated to be US $8.6 million to Meera

KAMPALA: As DFCU Bank prepares to relocate from 22 properties that belong to Meera Investments Limited, which is part of the Ruparelia Group of Companies, Meera Investments still contends that the former must pay rent arrears totaling to billions of shillings.

When BoU sold CBL to DFCU Bank it also transferred to the same bank freehold properties of CBL/Meera Investments Limited without following the law. CBL was renting the properties that were wrongfully transferred to Dfcu Bank.

In May this year, BoU would controversially extend the duration of Dfcu bank’s possession of freehold properties of Meera Investments Limited for extra 24 months after the first 34 months elapsed, having transferred CBL to Dfcu Bank on January 25, 2017 on account of undercapitalisation.

The deal to extend Dfcu bank’s free hold on Meera Investments’ properties was reached at between the BoU Governor Emmanuel Tumusiime-Mutebile, Deputy Governor Dr Louis Kasekende and director of Legal department Margaret Kasule on one side and Dfcu bosses on the other side.

The BoU officials penned that deal well-knowing that there is a case in court where Meera Investments which is part of the Ruparelia Group, wants Dfcu bank to return its properties but also pay rent on some of the properties specifically former branches of CBL.

The rushed deal to extend the contract for 24 more months could have been calculated to financially benefit top BoU officials.

However in the pending Meera Investments contends that the Commissioner land registration connived with Dfcu bank to transfer the leases of the 46 properties into the latter’s names without the written prior consent of the bonafide owner of the property, which meant the deal was null and void.

Meera Investments wants court to declare that the continued presence of Dfcu bank on its properties, amounts to trespass and that they should be ordered to vacate with immediate effect but now BoU has again extended the deal to have Dfcu bank occupy the branches. Meera Investment contends that it’s the rightful owner of the 46 branches formerly trading as Crane Bank and for that matter dfcu must pay rent arrears estimated to be US $8.6 million

Meera Investments also wants court to direct the commissioner of land registration to immediately cancel out Dfcu bank as being the right full owner of the said 46 properties and reinstate them as the rightful owners.

Sebalu & Lule Advocates mislead Dfcu Bank

Meanwhile, available evidence shows that Dfcu bank was misled by Sebalu & Lule Advocates to illegally transfer title properties that belong to Meera Investment Limited and Crane Bank Limited Meera Investment Limited.

According to a leaked memorandum of May 8, 2017,  Sebalu & Lule Advocates who were in April barred by the High Court from representing the same bank against businessman tycoon Sudhir Ruparelia for being conflicted misled Dfcu bank to transfer leasehold titles from Crane Bank Limited during the controversial takeover two years ago.

In a leaked document titled, “ Transfer of former Crane Bank household properties’, “the law firm ignored the important aspects of the law including the fact that banks are not allowed to invest in business for fear of conflict of interest with their clients, apart from their main premises.

“Our opinion is that although the proposed approach of registering caveats provides Dfcu with some level of legal protection, its indisputable title to the leasehold properties can only be guaranteed through the registration of transfers executed by BoU in favour of Dfcu. Accordingly, in light of the length of time between the completion  date and when Dfcu can validly exercise the option to rescind the purchase of the leasehold properties  our recommendation is that transfers be registered immediately,” the law firm advised.

According to industry experts, the whole procedure was entangled with fraud as there was no consent from the Landlord (Meera Investment Ltd) before transferring the lease to another party.

Experts say this, “nullifies the transfer because lack of consent alone nullifies the whole procedure” as ownership belonged to Meera Investment Limited, an independent body from the defunct Crane Bank Ltd.

The best option by Sebalu & Lule Advicates was to register caveats on the said leasehold properties but that would disadvantage Dfcu bank as it could take some time.

BoU in May agreed to hand Dfcu bank more 24 months to occupy freehold properties of Meera Investments Limited.

The resolution was signed by the central bank Governor Emmanuel Tumusiime Mutebile, his deputy Dr. Louis Kasekende and legal director Margaret Kasule.

Sudhir’s lawyers Kampala Associated Advocates argued that under the Land Act, the closed bank cannot own land and that it used an expunged process and false records.

The case is still in courts of law and Dr Sudhir’s claims have so far been proven by the findings of the Auditor General and COSASE who established that the closure of CBL and six other banks breached several provisions of the Financial Institutions Act 2014 and was therefore illegal.

legal experts say it was sloppy for the Lule and Sebalu Advocates, they could have instructed an intern to give a legal opinion in regards to the subject matter at hand or rather they could have two options, land Commission cancels the said transfer or Meera Investments is compensated at the prevailing market price.

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