Court orders businessman Kirumira to pay for fraudulent school takeover

Kampala, Uganda | THE INDEPENDENT |  High Court has ordered businessman, Godfrey Kirumira to compensate Stephen Sendagire and his wife, Gladys Nannyombi, the former proprietors of Bright Future Vocational Senior Secondary School Shillings 200 million for fraudulently taking over their school.

He was jointly dragged to the Commercial Division of High Court together with DFCU Bank and Kabiito Kenneth Karamagi in 2008. The two accused DFCU bank of selling off their property worth Shillings 1.4 billion to Kirumira at only Shillings 300 million.

The couple had mortgaged the school for a loan of Shillings 460 million. However, court documents show that the couple only received Shillings 315 million between May 2005 and May 2006. DFCU was faulted for having connived with Karamagi who acted as the receiver and Kirumira to declare the school a residential and undeveloped property.

However, Karamagi told court that there was a valuation report, which showed that the property in question was valued at Shillings 550 million but was instead forced to sell it at Shillings 300. In her judgment read by the commercial court registrar, Lillian Buchana on Monday, Justice Elizabeth Jane Alividza noted that although the process leading to the sale of the property was okay it was marred by lack of transparency and undervaluing of the property.

She also noted that the testimony of Kirumira concerning the takeover of the school contradicted that of other witnesses. Kirumira reportedly stated that he took over the school on December 10th 2007 after Karamagi took him to the area Chairperson. He explained that shortly after he sent his guards to guard the property.

However, this contradicted Karamagi’s testimony who said he was never involved in the takeover of the school. Evidence before court also shows that Kirumira took over the school on January 1st, 2008. Justice Elizabeth Jane Alividza said the applicants lost their school, saying it is impossible to restore them to their previous status.

She therefore ruled that they are entitled to the difference between undervalue and the best price of the suit property. “If the defendants (respondents) had exercised reasonable care they would have got the best price”, said Alividza.  She therefore directed DFCU to pay the couple Shillings 100 million as compensation.

She also directed Kirumira to pay the couple Shillings 200 million in general and punitive damages at 21 percent interest since 2008 until full payment is made.  “Court also awards compensation of loss of property taken over by the 3rd defendant (Kirumira). The decision has revealed high handedness acts of the 3rd defendant. He lied to court about his previous association with the plaintiffs. He took advantage of them and eventually their property “, reads the Judgment in part.

Court also directed Kirumira to return movable properties picked from the school like laptops.

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URN