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KAMPALA - Former Uganda Muslim Supreme Council (UMSC) secretary general, Hajji Ramathan Mugalu, has petitioned the Civil Division of the High Court to dismiss the case filed by the Uganda Muslim Lawyers Association (UMLAS) against the Muslim body regarding the sale of Muslim land in Sembabule district.

In his written statement of defence on May 20, 2024, Mugalu argues that the case is not appropriately before the High Court, as it is currently under litigation in the Court of Appeal.

The UMSC initiated the appeal earlier this year. Mugalu contends that the ongoing appellate process renders the High Court proceedings redundant.

Mugalu through his lawyers of ALP Advocates argues that the UMLAS action as set out is of a busy body, pleading the case of UMSC of which it is already litigating.

Mugalu argues that he and the Mufti of Uganda Sheikh Shaban Ramadhan Mubaje acted in good faith when executing the transaction in question with businessman Justus Kyabahwa on June 24, 2020.

He noted that the purchase price for the land was used to purchase an apartment in the city suburbs of Kyanja in Kampala, a portion of land with rental units at Nyanama in Kampala, another portion of land in Sembabule district, and the remainder of the funds was applied to maintain the operations of the UMSC during the COVID-19 period.

Mugalu says the Muslim body deemed it necessary to dispose of the land in question based on the resolution of its organs.

The case

Last year, the Muslim lawyers dragged UMSC, Mubaje, Mugalu and Kyabahwa to court seeking a declaration that the land sale agreement entered into on June 24, 2020, between UMSC and Kyabahwa is null and void.

They argue that the transaction is ultra vires and illegal in as far as it contained payment of interest (ribah) which is prohibited in the Quran and the teachings of Prophet Muhammad.

Led by their president Ali Kankaka, Luyimbaazi Nalukoola and Siraje Katantazi, the Muslim lawyers want Mubaje and Mugalu held liable as individuals arguing that they acted fraudulently and in total breach of the UMSC constitution.

The group also wants the order for attachment of UMSC properties rescinded arguing that the land sale agreement is tainted by fraud, corrupt practices, and illegality and was never executed by the authorised officers of the Muslim Council.

They also argue that the order for attachment arose from a syndicated litigation pursued by Kyabahwa against UMSC in collusion with Mubaje and Mugalu contrary to the law and public policy.

The Muslim lawyers are also seeking a declaration that Kyabahwa was not a bona fide purchaser for value without notice.

They argue that it was illegal for Mubaje, Mugalu, and Kyabahwa to make dealings in regard to land comprised in LRV 3693 folio 12 ranch number 31A at Sembabule fully cognizant of its encumbrances with interest from third parties including but not limited to Enterprise Holdings Limited and the same was under active litigation at Masaka High Court.

They argue that Mubaje, Mugalu, and Kyabahwa deliberately executed the contested agreement with full knowledge that it is unenforceable deliberately incorporating an unconscionable rate of 12% to camouflage the corrupt investment of Kyabahwa.

They accuse Kyabahwa of paying inducements and kickbacks to Mubaje and Mugalu to execute the agreement.

They contend that Mubaje and Mugalu transacted with negligence constituting a total breach of trust to the detriment of UMSC. 

Background

On June 24, 2020, UMSC sold 518 hectares of land comprising LRV 3693 folio 12, ranch no.3A land at Sembabule district to Kyabahwa.

Following the transaction, Enterprise dragged UMSC, Mubaje, Balonde, and Mugalu to Masaka High Court stating that it had a running lease of 15 years on it, which it had secured from Sembabule Muslim District Council, and that it had also entered into a sale agreement with the UMSC and paid sh280m.

On December 24, 2022, Justice Victoria Nakintu Katamba, issued an order, compelling UMSC to transfer the certificate of title to Enterprise Uganda Limited upon payment of sh620m unpaid contractual price at an interest rate of 24% per annum since 2017 to finalise the transaction.

Consequently, Kyabahwa through his lawyers filed a summary suit at the commercial court seeking recovery of his money in addition to 12% interest per month as contained in the sale agreement.

On August 7, Commercial Court judge Grace Harriet Magala ordered UMSC to pay sh19b to Kyabahwa but in vain.

On November 16, Commercial Court registrar Catherine Agwero ordered the attachment of eight prime properties belonging to the UMSC following an application by Kyabahwa.

However, the UMSC applied for a stay of execution at the Court of Appeal arguing that it had appealed against the decision. 

The matter is pending a hearing and determination by the Court of Appeal.