KAMPALA – Court has on Monday, September 2, ordered businessman Godfrey Kirumira to pay close to a billion Shillings in damages and legal costs incurred by the former proprietors of a school in Bwebajja along Entebbe Road in Wakiso District.
However, High Court judge Elizabeth Jane Alividza of the Commercial Division ruled that Kirumira retain ownership of the school.
According to the judgement read for the judge by Deputy Registrar Lillian Buchana, the court ordered Mr Kirumira to pay UGX 200 million with interest of 21 percent from 2008 todate, as special damages to the complainants, Mr Stephen Sendagire and his wife Ms Gladys Nannyombi.
The Judge also ordered DFCU Bank to pay the complainants UGX 100 million for losses incurred during the sale of their mortgaged property.
Justice Alividza held that the school property was sold undervalue of UGX 300 million despite an earlier valuation done in June 2007 which put the value at more than UGX 500 million.
“The sale of the suit property was conducted lawfully but undervalue and it lacked a degree of transparency,” held the judge before ordering Mr Kirumira to pay 60 percent of the legal costs incurred and 40 percent to be paid by DFCU Bank.
Justice Alividza further held that the complainants are no longer indebted to the bank after establishing that the property was sold undervalue and negligently.
The judge ruled that the complainants could not recover the property because they mortgaged it and failed to service the loan as required and more so, the property has since changed the status quo for the ten years.
Mr Kirumira was jointly accused with DFCU Bank and city lawyer Mr Kabiito Karamagi over fraudulent sale and acquisition of the school property under caveat and undervaluation.
In 2008, Mr Sendagire and Ms Nannyombi filed the case in the Commercial Court claiming that the bank sold their school property worth more than Shs1.4 billion to Mr Kirumira at a cost of Shs300 million.
Court documents indicate that between May 2005 and May 2006, Mr Sendagire mortgaged the school at Shs460 million but he was given Shs280 million in installments and another Shs35 million was given differently which accumulated to Shs315 million.
It is alleged that DFCU Bank connived with Mr Kabiito who acted as the receiver and Mr Kirumira to declare that the use of the property was residential and undeveloped whereas it was commercial.
Court heard that a valuation Surveyor in the Lands Ministry, Ms Lucy Kabenge oversaw the transfer process of a school property at Kitende on Entebbe, without visiting the physical location but basing on mere documentation.
Ms Kabenge, an official attached to the Chief Government Valuer’s office testified that she did not go to the property to verify the value of the property before approving the value of stamp duty.
Mr Kirumira, a property dealer was questioned in regard to purchase of a property under caveat, undervaluation, and size of the property as well as the process followed to conclude the transaction.