Crane Bank withdraws Supreme Court appeal

Crane Bank has in an unprecedented move withdrawn an appeal it filed before the Supreme Court challenging the dismissal of a Shs397b commercial dispute by lower courts against property mogul Sudhir Ruparelia and his Meera Company.

In its withdrawal notice dated September 15, Crane Bank — which is in receivership — stated that it “does not intend further to prosecute the appeal.” It also committed itself to pay the legal costs to Mr Ruparelia and his Meera Investments Company both at Court of Appeal and High Court levels where legal battles were lost. The standoff came after Crane Bank was placed under statutory management by Bank of Uganda (BoU) on October 20, 2016. Hell broke loose after the Central Bank placed Crane Bank under receivership, with some of its assets and liabilities sold to dfcu Bank.

On June 30, 2017, Crane Bank — in receivership — filed a commercial case before the High Court, Commercial Division in which it was seeking to recover more than Shs397b from Mr Ruparelia. It further accused him of misappropriating the funds as the director and shareholder with his Meera Investment Company.  On August 29, 2019, then presiding judge David Wangutusi delivered his ruling in which he dismissed the multibillion commercial dispute on grounds that Crane Bank lost its legal powers to sue Mr Ruparelia or to be sued the moment it was placed under receivership. But Crane Bank in receivership was dissatisfied with the decision of the Commercial Court and lodged an appeal before the Court of Appeal. 

A panel of three justices led by then Deputy Chief Justice (Alfonse Owiny-Dollo, now Chief Justice), also dismissed the appeal and upheld the ruling of the Commercial Court.

“Turning to the facts of this case, under Section 96 of the Financial Institutions Act, it is clear that there is a protection granted to the financial institution in receivership against being sued. In light of Meera Investments decision, it would be unfair to say that the financial institution can sue and on the other hand, it cannot be sued,” ruled the justices of the Court of Appeal in June 2020.

Still dissatisfied with the decision of the Court of Appeal, Crane Bank sought redress in the Supreme Court. It, however, made a U-turn before the appeal could be heard.  Efforts to reach Ms Charity Mugumya, the director of communications at BoU, were unsuccessful by press time last evening.