By Spy Uganda
It’s time for jubilation for businessman Sudhir Ruparelia after Court of Appeal from the High Court of Justice Business and Property Courts in England quashed an earlier decision by the lower court exonerating DFCU bank and its shareholders from fraudulently taking over Crane Bank-TheSpy Uganda reports exclusively.
In a judgement delivered on 26th July 2023 by Sir Julian Flaux, Chancellor of the High Court and Lord Justice Popplewell, Court okayed Crane Bank’s appeal on the ground that there are serious issues to be tried as to whether part of all of the appellant’s claims fall within the commercial activity exception and/ or the Public Policy Exception.
”In the present case the BoU and its officials are alleged to have abused their public office and duties in numerous respects, but the gist of the allegation is that all such matters were for the corrupt purpose of obtaining undue advantage in the form of huge financial inducements from a third party purchaser of CBL or its assets, in the event DFCU Bank. I consider that it is arguable that DFCU Bank cannot rely on the foreign act of state rule due to its alleged role in corrupting the BOU.
I would therefore allow the appeal on the ground of the Public Policy Exception,” states part of ruling deliverd by Lord Justice Popplewell and Sir Julian Flaux, Chancellor of Court of Appeal from the High Court of Justice Business and Property Courts in England.
The Court of Appeal contends 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 recommends that Bank of Uganda officials at the center of the transaction should be prosecuted of corruption.
In summary, the Court issued the following orders in favor of Crane Bank proprietors who are the appellants;
1. The Claimants’ appeal is allowed.
2. Paragraphs 1-4 of the Pelling Order are set aside.
3. The applications made by the First and Second Defendants and the Third to Fifth Defendants recited above are dismissed.
4. The First to Fifth Defendants shall pay 75% of the Claimants’ costs of the appeal and of the costs below, such costs to be to subject to detailed assessment if not agreed.
5. The First to Fifth Defendants shall pay the Claimants the sum of £700,000 on account of the costs at paragraph 4 above within 14 days.
6. The sums paid to the First to Fifth Defendants in accordance with paragraph
4 of the Pelling Order (as amended by the Second Pelling Order) shall be repaid to the Claimants within 14 days, plus interest at a rate of 4.5% per annum from 27 October 2022 up to and including the date of repayment.
The ruling comes against a backdrop of a lower court judgement in which a High Court of Justice of England and Wales on October 19, 2022, Lord Pelling QC sitting in London absolved both DFCU and BoU of wrongdoing in $211 million litigation.
Meanwhile, it’s worth noting that this is another juicy win for tycoon Sudhir Ruparelia, the proprietor of defunct Crane Bank who in July 2022 defeated BoU IN Supreme Court over sale of his bank.
The central bank closed Crane Bank in October 2016 claiming it was undercapitalised. The 2022 ruling was a culmination of a running battle between the central bank and Sudhir for over four years. The Supreme Court ruled that Crane Bank should revert to Sudhir and asked BoU pay all the costs which is estimated to be overUgx200b.
READ FULL LONDON COURT RULING BELOWCOURT OF APPEAL LONDON - CRANE BANK VS DFCU