Kampala businessman Hamis Kiggundu has in the wake of Wednesday’s Court of Appeal judgment quashing the Commercial Court’s ruling in the multi-billion lawsuit against Diamond Trust Bank (DTB) Uganda and Kenya, announced that he will appeal to the Supreme Court.
Mr Kiggundu announced the decision on Thursday through his lawyers Fred Muwema and Arnold Kimala.
“The Court of Appeal did not just refuse to pronounce itself on the illegalities committed by DTB, in an act derogating its appellate mandate, it also abandoned the grounds of illegality presented in the appeal. We have instructions to file an appeal in the Supreme Court, but we shall also be filing suits in the courts in Kenya and in the East African Court of Justice,” Mr Muwema told Sunday Monitor on Thursday.
Mr Kiggundu, through his companies sued DTB Uganda and Kenya in January last year for alleged breach of contract.
The businessman had borrowed money from the two institutions and had fallen behind on his repayments. The banks attempted to collect what he owed them, but the businessman filed a suit in the Commercial Court citing irregularities in the lending agreement.
The businessman sought declarations that the bank breached different loan agreements entered into between February 16, 2011 and November 16, 2019, a charge which the banks denied.
The banks argued that Mr Kiggundu and his two companies held accounts with them and on various dates borrowed $6.7m (about Shs24b), Shs1.5b, Shs1b, $4m (Shs14b) and $500,000 (Shs1.8b). They also argued that DTB Uganda acted lawfully and that it was not an agent for its Kenyan counterpart.
Justice Henry Peter Adonyo declared that since DTB Kenya was not licensed to conduct financial business in Uganda, the loans extended to Ham Enterprises were irregular, null and void. He also held that by acting as a collecting agent for DTB Kenya, DTB Uganda had contravened the Financial Institutions Act and Agent Bank regulations. The banks appealed the decision in the Court of Appeal.
However, on Wednesday, Justices Richard Buteera, Kenneth Kakuru and Christopher Madrama ruled that Justice Adonyo had erred in law when he faulted the lending arrangement and allowed Mr Kiggundu’s firms to recover Shs34b and $23.2m (about Shs84b) from them.
“The judgment of the trial judge is set aside,” Deputy Chief Justice Buteera ruled.
“An order is granted remitting the suit back to the Commercial Division of the High Court to be expeditiously fixed and heard by another judge,” ruled Justice Butera.