By Our Reporter
City Law firm Sebalu & Lule Advocates is back in the news for misleading dfcu Bank to illegally transfer leasehold title properties that belong to Meera Investment Limited and Crane Bank Ltd.
According to a leaked memorandum of May 8, 2017, Sebalu & Lule Advocates misadvised dfcu Bank to transfer about 48 leasehold titles from Crane Bank Ltd during the controversial takeover of Crane Bank Limited in on January 25, 2017.
Meera Investments Ltd is run under the Ruparelia Group whose Chairman is Sudhir Ruparelia whose Crane Bank Ltd was controversially closed by Bank of Uganda (BoU) in October 2016 for allegedly being undercapitalized before being sold to its rival dfcu Bank at Shs200 billion, paid in installments.
Part of the leaked document dubbed, “Transfer of former Crane Bank household properties’ shows that dfcu Bank skipped important aspects of the law including the fact that banks are not allowed to invest in business for fear of conflict of interest with their clients, apart from their main premises.
“Although the proposed approach of registering caveats provides dfcu with some level of legal protection, its indisputable title to the leasehold properties can only be guaranteed through the registration of transfers executed by BoU in favour of dfcu. Accordingly, in light of the length of time between the completion date and when dfcu can validly exercise the option to rescind the purchase of the leasehold properties our recommendation is that transfers be registered immediately,” the law firm advised.
According to industry experts, the whole process of transfer Meera Investment’s properties was full of fraud as there was no consent from the Landlord (Meera Investment Ltd) before transferring the lease to another party, which nullifies the transfer of ownership leasehold of Meera Investment Ltd, an independent company from the defunct Crane Bank Ltd, which was leasing the former’s banking halls.
The best option by Sebalu & Lule Advocates was to register caveats on the said leasehold properties but that would disadvantage dfcu Bank as it could take some time.
BoU in May agreed to hand dfcu bank more 24 months to occupy freehold properties of Meera Investments Ltd.
The resolution was signed by the central bank Governor Emmanuel Tumusiime Mutebile, his deputy Dr. Louis Kasekende and legal director Margaret Kasule.
Sudhir’s lawyers Kampala Associated Advocates argued that under the Land Act, the closed bank cannot own land and that it used an expunged process and false records.
The case is still in courts of law and Sudhir’s claims have so far been proven by the findings of the Auditor General and Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises [Cosase] who found out that the closure of Crane Bank and six other banks, breached several provisions of the Financial Institutions Act 2014 and was therefore illegal.
