In a groundbreaking verdict, dfcu Bank has been directed to vacate a set of prime properties owned by Mera Investments within the coming three months. Mera Investments is owned by prominent businessman Sudhir Ruparelia.
This momentous ruling was issued by Justice Tadeo Asiimwe, a distinguished Land Division Judge at the High Court, following an extended legal battle over property rights.
Alongside the eviction notice, the bank has been mandated to provide a staggering compensation of Shs2.4 billion to Mera Investments, the plaintiff, for the damages sustained during their pursuit of Justice. The awarded sum will accrue an 8 per cent annual interest from the date of the judgment until paid in full.
The ruling, handed down on Thursday, represents a significant turning point in a legal feud that has held the nation’s attention for an extended period. Mera Investments, a prominent real estate firm owned by Real Estate Magual, had staunchly asserted its ownership rights over these sought-after properties, some of which are nestled in the heart of the city.
The plaintiff had initiated this legal action against the defendants, namely DFCU Bank and the Commissioner of Land Registration, for their alleged illegal and fraudulent sale and possession of 48 leasehold properties. Mera 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 stemmed.
The battle centred around the possession of these properties, and the subsequent transfer of titles and lease possession in favour of dfcu Bank. In contrast, dfcu Bank refuted these allegations, maintaining that they had lawfully acquired their interest in the 48 leasehold properties through a purchase from the Bank of Uganda as a receiver of Crane Bank Limited.
Furthermore, the bank argued that no consent was required from Mera Investments before the transfer or the taking of possession of the disputed properties, as the transfer was executed under the provisions of the Financial Institutions Act.
dfcu Bank denied any involvement in illegal or fraudulent activities during the acquisition of the properties and cited the pleadings of Crane Bank Limited (in Receivership) to support their stance.
However, in a landmark decision, Justice Asiimwe ruled that the transfer of leasehold titles had flagrantly disregarded the statutory rights and powers of the lessor, deeming it illegal. He stipulated that the registration of DFCU Bank as the first defendant was procured illegally and thus liable to be cancelled.
Furthermore, Justice Asiimwe found that dfcu Bank became a trespasser on the land in January 2017, and the certificates of titles for the leased properties were obtained illegally and fraudulently, warranting their cancellation due to fraud and illegality.
The judge also recognised the need for general repairs and replacements within the properties and ordered dfcu Bank to vacate the premises within three months from the date of the judgment, after restoring them to a tenantable condition at their expense.
Moreover, acknowledging that Mera Investments had suffered financial losses and could not generate income from its properties during the dispute, the judge awarded them a total of Shs2.4 billion as general damages, with an 8 per cent annual interest from the date of the judgment until paid in full.
This decision represents a significant legal precedent and is anticipated to have broad implications for both the real estate industry and the legal landscape at large.