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BOU to appeal against Sudhir ruling

Former Crane Bank headquarters in Kampala.

Kampala, Uganda | THE INDEPENDENT | Crane Bank (in Receivership) is dissatisfied with Monday’s High Court’s ruling in their UGX397 billion case against Sudhir Ruparelia and will appeal, Bank of Uganda has confirmed.

The High Court Commercial Division on Monday dismissed the  Crane Bank (in Receivership) suit against Sudhir and Meera Investments, with Justice David Wangutusi ruling that they have no legal basis to sue.

The judge dismissed the suit over lack of legal basis to sue and ordered Bank of Uganda (BOU), that he said instituted the suit, to pay costs to the businessman, who had been accused of taking Shs397b out of the financial institution in fraudulent transactions and land title transfers.

Court ruled that a bank in receivership, under the Financial Institutions Act (2004) is not permitted to sue or be sued, and therefore, Crane Bank (in receivership) cannot and should not have sued businessman Sudhir Ruparelia and his Meera Investments.

In the ruling, the judge also said that Crane Bank (in receivership) being foreign owned, cannot own free-land in Uganda and therefore has no legal basis to sue for land it cannot own.

At stake are 48 branches that Crane Bank (in receivership) had wanted to repossess, and whose land titles are in the hands of DFCU that took over the bank.

BOU said Tuesday they would appeal.

“While Justice Wangutusi dismissed the UGX397 billion case against  Ruperalia on a technicality, alleging that Crane Bank (in Receivership) lost its powers to “sue” and to “be sued”, thus rendering its suit a nullity….. Crane Bank (in Receivership) maintains that receivership is a management situation, and hence no legal change as to capacity of a company to sue and be sued,” BOU said in a statement .

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HERE IS BOU STATEMENT IN FULL

Director Communications (BoU) wishes to inform the public that Crane Bank (in Receivership) intends to appeal against the whole of the decision given by Hon. Justice David Wangutusi on August 26, 2019, as per Notice of Appeal Application 320 of 2019 filed in the High Court today.

The High Court Judge Hon. Justice Wangutusi on Monday August 26, 2019 decided that Crane Bank (in Receivership) did not have any jurisdiction to file Civil Suit No. 493 of 2017 against Mr. Sudhir Ruparelia and Meera Investments Limited, and therefore dismissed the suit.

Crane Bank (in Receivership) is dissatisfied with the decision of the Hon. Justice Wangutusi, and has served a copy of the Notice of Appeal to Kampala Associated Advocates, the legal representatives of Mr. Sudhir Ruparelia and Meera Investments Limited.

On June 30, 2017, Crane Bank Limited (in Receivership) took Mr. Sudhir Ruparelia and his Meera Investments Ltd. to court for causing financial loss amounting to UGX 397 billion to Crane Bank in fraudulent transactions and land title transfers.

Crane Bank (in receivership) in its Civil Suit No. 493 of 2017 sought High Court to compel Mr. Ruparelia to pay back the US$80,000,000, US$9,270,172.00, US $ 3,560,000.00, US$990,000.00 and UGX 52,083,995.00 as compensation for breach of fiduciary duty.

While Hon. Justice Wangutusi dismissed the UGX397 billion case against Mr. Ruperalia on a technicality, alleging that Crane Bank (in Receivership) lost its powers to “sue” and to “be sued”, thus rendering its suit a nullity…..

Crane Bank (in Receivership) maintains that receivership is a management situation, and hence no legal change as to capacity of a company to sue and be sued.

Bank of Uganda would like to reassure the public that it is committed to pursuing this matter to its logical conclusion.

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FULL HIGH COURT RULING HERE

FULL RULING Sudhir Ruparelia & Anor vs Crane Bank Limited by The Independent Magazine on Scribd

 

 

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