ARE WE GOING TO SEE CRANE BANK BACK TO BUSINESS?

WHAT NEXT FOR BANK OF UGANDA WHEN IN TRANSITION FOLLOWING THE DEATH OF PROF. MUTEBILE AND NOW THE SUPREME COURT RULING ON CRANE BANK.

Court directs Crane Bank management  to return to Sudhir, BoU to pay costs.

The Supreme Court in Kampala has directed that the management of Crane Bank be reverted to its shareholders but also Bank of Uganda to pay costs as the five year battle comes to an end.

By Kenneth Kazibwe

The Supreme Court in Kampala has directed that the management of Crane Bank be reverted to its shareholders but also Bank of Uganda to pay costs as the five year battle comes to an end.

Bank of Uganda (BoU) /Crane Bank in receivership sued Sudhir Ruparelia and Meera Investments Limited of allegedly fleecing the defunct Crane Bank Limited (CBL) of Shs397 billion that the central bank wants to be refunded.

The Commercial Court  in 2019 dismissed the case Bank of Uganda had lodged against Sudhir Ruparelia seeking to recover Shs 379 billion from him.

The court, therefore, ruled that Crane Bank was a non-existent entity since it went into receivership three years ago.

After losing the case, BoU ran to the Court of Appeal to challenge the lower court’s decision but again lost the case prompting them to run to the Supreme Court.

However, shortly after filing an appeal, BoU sought to withdraw it before it could be heard,  prompting Sudhir’s lawyers of Kampala Associated Advocates objected to the withdraw.

On Friday, February 11 five justices of the Supreme Court including Rubby Opio Aweri, Percy Tuhaise, Ezekiel Muhanguzi,Prof.Tibatemwa Ekirikubinza and Faith Mwondha dismissed the appeal by BoU but also directed that the central Bank pay costs in the terms found by the Court of Appeal.

“For avoidance of doubt, the Court of Appeal upheld the finding of the trial court which ordered that the costs of the suit were to be borne by the Bank of Uganda since it was behind the filing of the suit and other subsequent actions. That order shall stand,” the Supreme Court directed.

The five justices also reasoned with the Court of Appeal that management of Crane Bank be returned to the shareholders including Sudhir Ruparelia and Meera Investments Limited since receivership had ended in 2018.

“We equally considered this aspect in our ruling and found that indeed, receivership of the appellant (Crane Bank in receivership) had ended on January, 20, 2018. The implication of that finding in our view is that the management of the appellant be reverted to shareholders after the January, 20, 2018,” the court directed.

The closure of Crane Bank was subject of an investigation by Parliament's Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) that discovered that Bank of Uganda injected in Shs478Bn to save the Bank, however when the move failed, Crane Bank was sold to DFCU Bank at Shs200Bn.

https://www.independent.co.ug/mps-demand-audit-into-ugx-478bn-injected-into-crane-bank/