July 18, 2024

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Tycoon Kiggundu Appeals Court decision on UGX 120 Billion case

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Kampala businessman Hamis Kiggundu has filed a notice of appeal against Court of Appeal decision which nullified orders by Commercial Court directing Diamond Trust Bank Uganda and Diamond Trust Bank Kenya to refund more than  120 billion shillings to him.

Three Justices of the Court of Appeal – Deputy Chief Justice Richard Buteera, Kenneth Kakuru and Christopher Izama Madrama on May 5th 2021 quashed Commercial Court order issued by Judge Henry Peter Adonyo in favor of Kiggundu and ordered a retrial before another Judge.

Judge Adonyo in  October 2020 ordered the banks to refund all monies deducted from Kiggundu’s accounts in a case involving syndicated banking agreement between Diamond Trust Bank Uganda and Diamond Trust Bank Kenya. 

The monies were allegedly deducted from Kiggundu’s two accounts for for Kiggs Enterprises Ltd and Ham Enterprises Ltd without his consent.

  Trial Judge Adonyo had dismissed the banks’ defense statements and ordered them to refund the monies illegally obtained from Kiggundu with an interest of eight percent and costs of the suit among other orders.

Subsequently, the banks challenged the decision before  the Court of Appeal arguing that the commercial court decision was reached without evaluating any evidence on record related to the breach of contract, fraud and statutory duties between the parties among other grounds.

However, in their Judgement last week, the three Justices of Appeal faulted Justice Adonyo for failing to hear and determine the case on merit but rather decided it on a mere point of law, saying the banks had filed their written statement of defense to the case.

According to Justice Madrama who wrote the lead judgement, Kiggundu and his companies were borrowers and he wondered why a court of law would enforce an illegality especially after saying that the contract was Illegal.

“Further, could the plaintiff’s recover money on the basis of an illegal transaction?” read the ruling. “The learned trial Judge went ahead to enter judgement allowing colossal sums of money against the appellants after striking out their defense on the ground of an illegality and without having given them a hearing on the basis for the awards. The general proposition of law is that what is done in contravention of the provisions of an Act of Parliament cannot be made the subject matter of an action”, he said.

According to the Appeal Justices, since the decision by the Adonyo struck out the written statement of defense by the banks, it became impossible for Kiggundu also to succeed in the action based on an alleged illegality. As such, the Justices unanimously ordered the case file to be sent back to the High Court for retrial and condemned Kiggundu to pay costs of the appeal to the banks.

  Being dissatisfied with the Court of Appeal decision, on Monday Kiggundu together with his companies Ham Enterprises Limited and Kiggs International Uganda Limited decided to notify both Court of Appeal and the Supreme Court about their intention to challenge the same.

“Take notice that Ham Enterprises Limited and two others, being dissatisfied with the decision of Honorable Justice Christopher Madrama, Honorable Justice Kenneth Kakuru and Honorable Justice Richard Buteera given at Kampala on May 5th 2021 intend to appeal to the Supreme Court against the whole decision,” reads the notice in part.

Through their lawyers of Muwema and Company Advocates, Kiggundu has accordingly asked Court of Appeal to give them a certified copy of the proceedings to enable them to formulate the grounds of appeal. 

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