Court hands Bright Future Secondary school to tycoon Kirumira

Court has ordered businessman Godfrey Kirumira to retain ownership of a disputed school property at Bwebajja on Entebbe Road in Wakiso District but ordered to pay millions of Shillings in damages and legal costs incurred for the last ten years.

Justice Elizabeth Jane Alividza of the Commercial Division of the High Court ordered Mr Kirumira to pay Shs200 million with interest of 21 percent from 2008 to date, as special damages to the complainants, Mr Stephen Sendagire and his wife Ms Gladys Nannyombi, the former proprietors of Bright Future Vocational Senior Secondary School.

The Judge also ordered DFCU Bank to pay the complainants Shs100 million for loss incurred during the sale of their mortgaged property.

In the judgment read by deputy registrar Lillian Buchana, the judge ruled that the school property was sold was undervalued at Shs300 million despite an earlier valuation done in June 2007 which put the value at more than Shs500 million.

“The sale of the suit property was conducted lawfully but undervalued and it lacked a degree of transparency,” ruled the judge before ordering Mr Kirumira to pay 60 percent of the legal costs incurred and 40 percent to be paid by DFCU Bank.

Justice Alividza further ruled that the complainants are no longer indebted to the bank after establishing that the property was sold undervalue and negligently.

The judge reasoned that she could not make an order to return the school property to the complainants because they mortgaged it and failed to service the loan as required but more so, the property has since changed the status quo for the last ten years.

Mr Kirumira was jointly accused with DFCU Bank and city lawyer Mr Kabiito Karamagi of fraudulent sale and acquisition of the school property under caveat and undervaluation.

In 2008, Mr Sendagire and Ms Nannyombi filed the case in the Commercial Court claiming that the bank sold their school property worth more than Shs1.4 billion to Mr Kirumira at a cost of Shs300 million.

Claim
Court documents indicate that between May 2005 and May 2006, Mr Sendagire mortgaged the school at Shs460 million but he was given Shs280 million in installments and another Shs35 million was given differently which accumulated to Shs315 million.

It is alleged that DFCU Bank connived with Mr Kabiito who acted as the receiver and Mr Kirumira to declare that the use of the property was residential and undeveloped whereas it was commercial.