The UK Supreme Court has ordered that DFCU, Juma Kisaame, William Sekabembe and Jimmy Mugerwa must stand trial in the UK court for their role in the fraudulent acquisition of the assets of Crane Bank Limited from Bank of Uganda.
DFCU and its former directors had sought to avoid accountability in this case by presenting a jurisdiction challenge, arguing that the corrupt sale of the assets of Crane Bank Limited to DFCU by Bank of Uganda was an act of state by the Government of Uganda, and that UK Courts had no jurisdiction to hear the case. This argument was rejected by the UK Court of Appeal, and they were ordered to file their defences and proceed to trial in the UK High Court.
They then sought leave of the UK Court of Appeal to appeal this decision to the UK Supreme Court, which leave was denied. They then filed another application seeking the leave to appeal from the UK Supreme Court.
But on Monday, 08 January 2024, Lord Lloyd-Jones, Lord Leggatt and Lord Burrows of the UK Supreme Court said the dfcu Bank application does not raise any arguable point of law.
They have been ordered to pay costs and must now file their defences within 21 days.
“After consideration of the applications filed on behalf of the Appellants seeking permission to appeal the order made by the Court of Appeal on 26 July 2023 and of the notices of objection filed by the Respondents, the court ordered that 1) Permission to appeal be refused because the applications do not raise an arguable point of law which the court should consider at this time (i.e. before trial). 2) In each application the Appellants pay the Respondents’ costs, the amount of those costs to be assessed if not agreed,” the ruling reads.
DFCU Limited, DFCU Bank Limited, Jimmy Mugerwa, Juma Kisaame, William Sekabembe, CDC Group PLC, Norfinance AS, Rabo Partnership B.V., Arise B.V., Stephen Caley, Michael Alan Turner, Albert Jonkergouw, Willem Cramer, Ola Rinnan and Deepak Malik have all been sued in the UK in a case seeking the recovery of over US$220 Million, before assessment of additional damages, which experts believe will raise the amount to be recovered to over US$500M.
The Court of Appeal had issued a judgement quashing earlier decision by the lower court exonerating dfcu Bank and its shareholders from fraudulently taking over Crane Bank.
The Court of Appeal contended with Sudhir Ruparelia and 7 other applicants that Dfcu Bank and its shareholders bought Crane Bank Limited (CBL) through a well-crafted corruption scheme involving the officials of Bank of Uganda.
The Court also recommended that Bank of Uganda officials at the centre of the transaction be prosecuted of corruption.
The ruling came against a backdrop of a lower court judgement in which a High Court of Justice of England and Wales on October 19, 2022 absolved both DFCU and BoU of wrongdoing in $211 million litigation.
However, 3 judges of the Court of Appeal ruled that the High Court should have found that there was at least a serious issue to be tried which include that the sale by BOU to DFCU was commercial rather than sovereign in character and all of the executive acts in question engaged the English public policy of combatting and not giving legal protection to bribery and corruption, therefore falling outside the foreign act of state rule (“the Public Policy Exception”).
The 3 judges who included Justice Phillips, Justice PoppleWell and Sir Julian Flaux heard that the Appeal raised issues as to the scope and application of the foreign act of state rule and of the limitations and exceptions to which it is subject.