On Friday, the Court of Appeal Judge Oscar Kahika imposed a temporary injunction to stop Diamond Trust Bank (Uganda and Kenya) from selling property belonging to city tycoon Haruna Sentongo.
Haruna Enterprises entered into an agreement with DTB Uganda and DTB Kenya on November 2, 2019, and as per the court documents submitted, they are contractually obligated under the Security Realisation Agreement. This has resulted in them being indebted to the Respondents in the amounts of Shs. 9,868,883,045 and USD 6,614,084 respectively.
According to the Mortgage Regulations of 2012, applicants are required to deposit 30 per cent of the forced sale value to halt the proposed sale of the property. For DTB Uganda, this amounts to 2,960,664,913.5 UGX, while for DTB Kenya, it stands at USD 1,984,225.2. The properties in question, serving as collateral, are Block 12 Plots 538 and 898 at Mengo, which are developed with a market.
However, on January 17th, 2020, the Applicants filed a petition seeking, among other things, the annulment of the Security Realization Agreement between them and the Respondents, dated November 2nd, 2019, alleging fraudulent execution. When Civil Suit No. 42 of 2020 was scheduled for a hearing on March 30th, 2023, the Respondents requested an adjournment to prepare their trial bundle. The presiding judge then set deadlines for submitting witness statements, trial bundles, and a joint scheduling memorandum.
The Applicants requested and were granted permission to alter their plaint on April 18, 2023. Then, they filed the modified plaint on June 21, 2023. Nevertheless, on November 27, 2023, the Respondents asked for more information. Due to the amendments’ inability to satisfy filing requirements, the trial judge dismissed the case with costs when it was heard on November 29, 2023.
The Respondents disregarded the court’s order to file their trial bundle even after it was dismissed. The Applicants filed a Notice of Appeal and asked for proceedings in response. This appeal has a strong likelihood of success and shows promise.
The fact that the Respondents have sent brokers to the contested property and are stating it is for sale aggravates the matter. It’s from this background that the Applicant sought an injunction.
In his ruling, Justice Kahika alluded that the applicant prayed for a temporary injunction maintaining the status quo until the determination of the appeal was pending before this court. He believed the balance of convenience favours the applicant who is in possession and stands to be prejudiced if the suit property is sold.
“It is therefore my considered view that the applicant in this case has made out a case for the issuance of a temporary injunction restraining the respondent from the sale or interference with the suit property until the applicant’s appeal vide Civil Appeal No. 1553 of 2023 is disposed of by this court,” he said.
He added; “An order of a temporary injunction is hereby issued restraining respondents, their agents, representatives, nominees and/or assignees and successors in title from selling, transferring, alienating, evicting, dealing with and or in any way interfering with the Applicant’s interest and possession of the properties comprised in Block 12 Plots 538, 826 and 898 at Mengo until the termination of Civil Appeal No. 1553 of 2023.”
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