The High Court has given the Bank of Uganda (BoU) 15 days to file a defence in a case brought against it by businessman Sudhir Ruperalia, a shareholder in the now-defunct Crane Bank, who was sued for the recovery of US$80 million, allegedly taken from Crane Bank.
Last week Mr. Ruparelia filed a case, in which he accused the central bank of reneging on an agreement agreed upon in a tripartite meeting involving the lawyers representing the Crane Bank and BoU, Messrs David Mpanga of AF Mpanga and Company Advocates; Timothy Masembe Kanyerezi of MMAKS Advocates, respectively, and the businessman himself.
In the agreement dubbed the Settlement and Release Agreement agreed upon on March 20 this year, Mr. Ruparelia and the opposite side agreed to a raft of settlement proposals, bound by confidentiality clauses.
In one of the proposals the two sides agreed to halt all proceedings, both civil and criminal, against Mr. Ruparelia, if he fulfilled all the conditions as agreed in the March 20 meeting. ‘This confidential Settlement and Release Agreement is in full, complete and each of the BoU and CBL hereby fully and fiunally releases and forever discharges and shall refrain from instituting, directing, procuring, instigating or maintain any actions, sanctions whether administrative, civil or criminal in nature,’ the agreement states in part.
In respect to the March 20 agreement, on July 7, Mr. Ruparelia wrote to lawyers Masembe Kanyerezi and David Mpanga, informing them of his decision to put three multi-billion properties as security/guarantee as he seeks to offset any would-be liabilities accruing from the case lodged in court by the BoU, in six months.
In his letter, Mr. Ruparelia said his securities/guarantees included all land titles for the Speke Resort Munyonyo Limited; all his interests and properties in the Commonwealth Resort Munyonyo and, all his interests in Baumann House on Parliament Avenue. ‘In the spirit of the Settlement and Release Agreement, this is to confirm that I am committed to fulfilling my obligations in the interest of an amicable resolution of all claims surrounding my shareholding, control and management and capitalization of the Crane Bank (‘CBL’) from incorporation to the date of takeover by the Bank of Uganda, including other current and former shareholders, Directors and employees of the CBL, associates and affiliates’.
Mr. Ruparelia added: ‘Accordingly, I hereby confirm as a guarantee and security for the performance of my obligations under the ‘Settlement and Release Agreement’ I am ready to immediately hand over the certificates of title for the following properties’. The BoU-Crane Bank-Sudhir issue has caused divided opinion among those involved, with reports indicating that top officials at the BoU are reportedly divided over the procedures undertaken by the Central Bank that led to the court case. According to sources, some top managers argue that the BoU, through its Bank Supervision Directorate headed by Ms. Justine Bagyenda, failed to execute its supervision mandate.
The protagonists also argued that the BoU had not exhausted all avenues that could lead to a negotiated settlement of the stand-off.