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Katatumba loses Hotel Diplomate to Shumuk
Publish Date: Feb 21, 2010
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By Hillary Nsambu and Chris Omony

BONNY Katatumba, the Pakistani honorary envoy to Uganda, has lost a bid to block the takeover of Hotel Diplomate by Shumuk Springs Development and Springs International Hotel that bought it.

This followed a ruling in which Justice Lameck Mukasa of the Commercial Court refused to stop the two companies owned by a Kampala tycoon, Mukesh Shukla, from “re-entering the premises.”

Shukla had opposed Katatumba’s application to stop him from re-entering the property, arguing that he had been unlawfully evicted.
Katatumba had his diplomatic offices in the hotel located at Kisugu, Muyenga Tank Hill.

Katatumba had applied for a temporary injunction, restraining Shumuk from “trespassing, alienating and evicting” him from the property, pending the determination of his case in which he claims that he is the rightful proprietor.

He argued that he had signed the agreement and handed over the certificates of title to Shukla together with the transfer instruments as security for payment of his creditors to facilitate conclusion of an earlier transaction in respect of his Blacklines House on Colville Street, Kampala.

However, Shukla said by an agreement signed in November 2008, Katatumba offered to sale Hotel Diplomate to Springs International Hotel at $630,000.

He stated that $110,000 was paid to Katatumba and the balance of $520,000 was to be paid to Katatumba’s creditors in respect of Blacklines House on Colville Street, Kampala.

Court records indicate that upon full payment, Katatumba executed all the relevant documents necessary for the transfer of the property. Springs International Hotel lodged the transfer forms for the mailo title and the leasehold title interests with the land registry and; the mailo titles were transferred into its name, while that of the lease title is still pending.

It was noted that the two companies took possession and management of Hotel Diplomate until Katatumba “unlawfully evicted” them in April 2009.

“It must be noted that the agreement of sale is dated November 10, 2008 while the resolution to sale is dated November 20, 2008. The sale agreement predated the resolution to sale,” the court’s ruling reads in part.

“I find that the applicant have failed to satisfy their obligations under the consent order. In the premises, I find that the respondents have shown sufficient cause why the warrant of execution should issue,” the judge stated.

“This application coming for final disposal on this 15th day of February 2010 before the learned Judge Hon. Justice Lameck N. Mukasa, it is hereby ordered that the application made for a temporary injunction is herby dismissed with costs,” Justice Lameck ruled.

“The applicants have not satisfied their obligations under the consent order in Miscellaneous Application No 193 of 2009. Warrant of execution shall not issue against the respondents,” the ruling added.

Following the court’s ruling, Shukla’s attorneys asked Katatumba to vacate the premises within 24 hours.

In a February 18, 2010 letter to Katatumba’s lawyers, the advocates pointed out that the implication of dismissal was that Shukla and his two companies were the registered proprietors and had an express right to take over occupation and quiet possession of the property with immediate effect.

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