In a significant legal development, Dfcu Bank has been given a three-month ultimatum to vacate a set of prime properties owned by Meera Investments, a company belonging to the renowned businessman Sudhir Ruparelia.
This groundbreaking verdict was delivered by Justice Tadeo Asiimwe, a distinguished Land Division Judge at the High Court, marking the end of a prolonged battle over property rights.
The court ruling includes a mandate for Dfcu Bank to provide substantial compensation of USh2.4 billion to Meera Investments, the plaintiff, for the damages they incurred during the legal proceedings.
This compensation will accrue an 8 per cent annual interest from the date of the judgment until it is paid in full.
The verdict, handed down on Thursday, represents a crucial milestone in a legal feud that has captured the nation’s attention for an extended period.
Meera Investments, a prominent real estate firm owned by real estate mogul, had staunchly asserted its ownership rights over these sought-after properties, some of which are situated in the heart of the city.
The plaintiff initiated legal action against the defendants, Dfcu Bank and the Commissioner of Land Registration, alleging the illegal and fraudulent sale and possession of 48 leasehold properties.
Meera Investments based its claims on its status as the registered proprietor and lessor of 48 Mailo and freehold titles, from which the lease agreements in question originated.
The legal dispute revolved around the possession of these properties and the subsequent transfer of titles and lease possession in favour of Dfcu Bank.
Dfcu Bank, on the other hand, contended that they had lawfully acquired their interest in the 48 leasehold properties through a purchase from the Bank of Uganda, acting as a receiver of Crane Bank Limited.
The bank maintained that no consent was required from Meera Investments before the transfer or taking possession of the disputed properties, as the transfer was executed under the provisions of the Financial Institutions Act.
Dfcu Bank denied involvement in any illegal or fraudulent activities during the acquisition of the properties and cited Crane Bank Limited’s (in Receivership) pleadings to support their position.
However, in a landmark decision, Justice Asiimwe ruled that the transfer of leasehold titles had blatantly disregarded the statutory rights and powers of the lessor, deeming it illegal.
He determined that the registration of Dfcu Bank as the first defendant was obtained unlawfully and thus liable to be cancelled.
Furthermore,Justice Asiimwe found that Dfcu Bank had trespassed on the land in January 2017, and the certificates of titles for the leased properties had been acquired through illegal and fraudulent means, warranting their cancellation due to fraud and illegality.
The judge also acknowledged the need for general repairs and replacements within the properties. He ordered Dfcu Bank to vacate the premises within three months from the date of the judgment, but only after restoring them to a tenantable condition at their own expense.
Additionally, recognizing that Meera Investments had suffered financial losses and couldn’t generate income from its properties during the dispute, the judge awarded them a total of USh2.4 billion as general damages, with an 8 per cent annual interest from the date of the judgment until it is paid in full.
This momentous legal precedent is expected to have broad implications for both the real estate industry and the legal landscape in Uganda.