The High Court (Commercial Division) has dismissed the application by the administrators of Simbamanyo Estates Limited in which they wanted the auctioning of its prime properties in Kampala by Equity Bank Ltd to recover an outstanding loan of Shs40.1bn to be halted.
The ruling was made by High Court judge Her Worship, Bucyana Lillian, in the absence of the parties upon application by Co-Counsel for the 2nd defendant (Meera Investments limited).
Meera Investments had pleaded that it had nothing to do with the Simbamanyo estates owners because it was an outsider to their business transaction with Equity bank. Meera only bought the building lawfully from the bank after Mr Peter Kamya and his firm failed to honor their loan obligations.
“It is hereby ordered and Decreed that the suit abates for failure to take out summons for directions in time. Given under my hand and the seal of this Honorable Court this 7th day of February 2021,” reads the ruling.
Simbamanyo’s case was first dismissed by the Court of Appeal judge Justice Christopher Madrama last year in October because Simbamanyo Estates did not have acceptable grounds for the court to deny the bank legal costs incurred.
“The respondent (Equity Bank) upon being served, instructed lawyers and the lawyers took action to oppose the application by filing the appropriate affidavits in reply, as well as written submissions,” Justice Madrama held.
At the beginning of October, Simbamanyo Estates filed an application expressing orders to halt the sale of its properties although the bank went ahead and sold Simbamanyo building on Lumumba Avenue and Afrique Suites Limited, a four-star hotel at Mutungo Hill, Nakawa Division.
However, Justice Madrama ruled that stopping the sale would have been an infringement on the bank’s right to be heard as well as an inconvenience to those who had prepared for the auction that was advertised on August 7 and 11 last year.
“The application for withdrawal was not conceded to unconditionally but was on condition of payment of costs. In the circumstances, therefore, the applicant (Simbamanyo Estates) application stands dismissed upon withdrawal and the only issue for consideration is whether should be payable,” Justice Madrama ruled.
The bank sold the building to Meera Investments whose majority shareholder is property magnet Sudhir Ruparelia. This was after Simbamanyo Estates failed through all avenues to pay the Shs40.1b loan. The prime building in the city centre was auctioned by the bank for recovery of the loan.
The properties were guaranteed to Equity Bank Uganda as security to get the loan in November 2017.
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