It is the Supreme Court that will determine the costs to be paid to city businessman Sudhir Ruparelia by Bank of Uganda (BOU) in the long-running legal battle between the tycoon and his Meera Investments Ltd and the central bank, resulting from the closure of Crane Bank Ltd.
Both the High Court and the Court of Appeal ordered that the Bank of Uganda must pay costs because they has been handling this matter from the beginning and not its shadow (Crane bank in receivership).
This was a contention of whether BOU or Crane Bank (in receivership) should pay costs after the central bank lost a case in which it had sought to recover Shs397 billion from Sudhir. Both the High Court and Court of Appeal ruled that there was no reason to deny costs to be paid to Sudhir by BOU.
Sudhir’s Lawyers of the Kampala Associated Advocates opposed the move by BOU to have the matter withdrawn on grounds that the appellants (Crane Bank in receivership) are trying to reverse the decision of the lower courts in regard to payment of costs.
On June 30, 2017, the appellant filed a suit in the High court in Kampala, which Sudhir and Meera investment opposed.
The High Court subsequently dismissed the case, prompting the respondents (Sudhir and Meera investment) to ask for costs to be awarded against BOU because it was BOU that was on record as the entity behind filing the suit which court said was incompetent. The High Court agreed with the respondents and awarded them costs.
“Since section 96 of Financial Institution Act insulated Crane Bank Ltd under receivership from court proceedings, execution or other legal processes, the person that should pay costs should be the person who instituted the suit and that is Bank of Uganda. This is so because Crane Bank in receivership had no capacity to foot the costs,” the response to the withdrawal notice stated.
The Supreme Court in August this year, dismissed with costs, an application by lawyers representing the Bank of Uganda in which they sought to substitute the court record from Crane Bank Ltd (in receivership) to Crane Bank Ltd (in Liquidation), with the court rejecting the move, as in bad faith and intended to circumvent facts.
BoU later withdrew the suit, after suffering successive defeats to Sudhir’s lawyers.
A panel of the Supreme Court Justices including Ruby Opio-Aweri, Faith Mwondha, Lillian Tibatemwa, Ezekiel Muhanguzi and Night Tuhaise, in a ruling issued on August 12 rejected arguments by BoU lawyers led by veteran attorney the late Dr. Joseph Byamugisha, reasoning that Crane Bank Ltd (in Receivership), Crane Bank Ltd (in Liquidation), and Crane Bank Ltd are three distinct entities with different rights, powers and obligations.
Earlier in the High Court, Justice David Wangutusi noted in his ruling that at the time BoU and Crane Bank (in receivership) filed the suit against Mr Ruparelia and his Meera Investments in January 2017, Crane Bank Ltd was a non-existing entity, having been terminated when the Central Bank sold its assets to dfcu Bank in October 2016.
On October 4, 2021, Supreme Court quashed attempts by the BOU to hold on to the jurisdiction of the defunct Crane Bank Ltd, arguing that once the commercial bank was closed, it was no longer a financial institution and therefore outside the legal care of the central bank.