Court orders on businessman Kiggundu's properties

The Commercial Division of the High Court in Kampala has issued an order restraining Diamond Trust Bank Uganda and its sister company in Kenya from interfering with commercial properties belonging to Kampala businessman Hamis Kiggundu.

Kiggundu, a businessman and property developer, who owns a string of properties,  has been battling the banks in court seeking to recover over sh118b.

 He says the money was fraudulently debited from accounts of his three companies in the two banks for over 10 years. The consent order, delivered on Monday by Justice Henry Adonyo, the head of the Commercial Division of the High Court, maintained an earlier temporary injunction that was issued on February 19, 2020, by the deputy registrar, Dr. Agnes Nkonge.

The injunction awaits the hearing and determination of the main suit at the Commercial Court in Kampala, seeking to recover the money.   Kiggundu trades using three companies — Ham Enterprises Ltd, KIGGS International (U) Ltd, and Skylight Investments.

Nkonge had issued an injunction restraining the banks and their agents from "advertising, for sale, selling, placing under receivership, tampering with, disposing of, auctioning, taking possession of or taking steps or interfere with Kiggundu's interests in all his prime land".

The land in question is located in Kyadondo Block 248, Plot 328, Plot 36-38 Victoria Crescent II Kyadondo and Plot 923 Block 9, located in the city suburbs of Kawuku and Makerere Hill Road, respectively. Justice Adonyo ordered Kiggundu to file amended pleadings by August 10, 2020, and the bank replies by   August 24.

Documents filed at the Commercial Court on January 17, 2020, indicate that the properties were the subject of credit facilities from the banks, believed to have been settled by Ham Enterprises and KIGGS International.

ORDERS

Kiggundu maintained in the suit that he has since terminated the facility contracts and mortgage instruments on the grounds of breach of terms of the contract, breach of contractual, fiduciary and statutory duties, misrepresentation as well as negligence.

Kiggundu seeks a court declaration that the banks acted in breach of contractual, fiduciary, and statutory duties during the subsistence of bank-customer and contractual relationships with him. He also seeks a court directive for the full account reconciliation of all fi financial transactions between his companies and the defendants.

The businessman further wants the court to issue an order for the recovery of all monies unlawfully, unjustly or unfairly debited or recovered from his companies during the subsistence of their credit relationships with the defendants. Kiggundu also wants an order for the release of his properties from any charge so that it is returned to him.

FACTS OF THE CASE
According to court documents, Kiggundu's companies hold bank accounts with the named banks, which they operate in connection with commercial construction business. Kiggundu says his companies sought credit facilities at different occasions from the banks for commercial construction, development, and completion of commercial properties and he placed his properties as security.

He contends that between February 2011 and September 2016, the banks contracted his companies into various credit facility contracts, some of whose terms, unknown to him, had unreasonable, unfair, unconscionable, and unjust terms. The businessman says during the credit period, his companies ably serviced their respective credit facilities and the banks benefi ted in form of interest payments on principal amounts and installment repayments on the principal sums.

Kiggundu, however, says it has since transpired that the banks either did not disburse some of the agreed sums, but in-turn, unlawfully debited from his companies' accounts, without his consent. A comprehensive review, audit, and reconciliation conducted by accountants for Kiggundu's companies in support of the suit indicate that the refund sought by the petitioners is in amounts of about $23.4m (sh86b) and sh34.2m, respectively.