The High Court Civil Division has ordered Tropical Bank Limited to immediately unfreeze the accounts of the World Islamic Call Society-WISC, a Libyan International and Interstate humanitarian organization.
Justice Musa Ssekaana issued the orders on Tuesday shortly after declaring the freezing of the accounts unlawful.
He also directed Tropical Bank Limited to pay the costs of the suit. The Judgement from an application filed by WICS in 2021 challenged the decision to freeze four accounts with the bank, which were opened in 2019. The evidence before the Court showed that in 2019, WICS signed a Host Agreement with the Government of Uganda. In the agreement, the government committed to grant WICS immunity from all legal processes.
However, around April 2020, WICS attempted to transact using its Shillings and Dollar accounts to finance its day to day activities and was shocked to discover that Tropical Bank Limited had frozen both accounts and two others. According to the court documents, the freezing of the accounts caused the humanitarian organisation suffering, anguish, loss, inconvenience and hardships since it couldn’t operate.
The court also heard that the actions of Tropical Bank were unlawful, suspicious, unjustified and in breach of the Diplomatic Privileges Act and the Host Agreement since WICS was never given a fair hearing. WICS asked the court to declare the freezing of their bank accounts unlawful and issue a permanent injunction stopping the bank from suspending its accounts in the future.
In its defence, Tropical bank informed the Court that they received instructions from the General Manager of WICS directing it to freeze the accounts following a change in leadership of the organization in Uganda. According to the bank, after receiving the instructions, they informed the Country Director and Libyan Embassy in Uganda since WICS is an Interstate humanitarian organization headquarters in Libya’s capital, Tripoli.
The bank explained that they later received a letter from the WICS Country Director referring them to a communication from the purported Chairman of the Steering Committee in Tripoli countering the instructions they had received from the General Manager from the same country.
The evidence before the court further shows that Tropical bank tried in vain to seek guidance from the Libyan Embassy concerning the conflicting instructions from WICS relating to the change of leadership in Uganda.
In his judgement, Justice Ssekaana indicated that the Libyan Embassy in its Diplomatic Note dated November 24th, 2020 confirmed to the bank and the Ministry of Foreign Affairs that the legal representative of the organization is Saleh Salim Al-Fakri in his capacity as Chairman of the Steering Committee and AbdelSalam A. Ali as the Country Director and Financial Controller as the lawful signatories to the organisation bank account.
He noted that under the agreement, the organization is mandated to operate bank accounts in Uganda through the Country Director and Financial Controller, which means no other person has any mandate to interfere with its operations in Uganda.
“The actions of the bank to block/freeze the bank accounts of the plaintiff/Organization premised on alleged communication from the General Manager of World Islamic Call Society would be illegal and supported by the authority of the agreement authorizing its operations in Uganda,”ruled Ssekaana.
Adding that, “The court takes judicial notice of the fact Libya as the country is going through a lot of turmoil and turbulence, which may make it impossible to know the central point of the authority of the government.”
According to Ssekaana, the actions of the bank through its Managing Director to receive directions on how the bank account in Uganda should be operated is an abuse of authority and it should have followed the guidance of the Libyan Embassy in Uganda.
“The bank is in fear of annoying some people in Libya (General Manager) and they have opted to do this at the expense of their obligations as bankers. The customer in Uganda who is mandated to manage the bank accounts is prejudiced by the said actions and this is the risk of liability they will have to face for failure to inquire into the true circumstances of the case,” said Ssekaana.
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