The Commercial Division of the High Court in Kampala on Monday trashed an application by City tycoon Patrick Bitature and Simba properties Co. Ltd, seeking a temporary injunction against Vantage Mezzanine Fund II Partnership.
Bitature run to court through his lawyers Muwema & Co. Advocates on behalf of Simba telecom, Linda properties and Elgon Terrace to halt Vantage from proceeding with any legal action in a case of fraud they had filed in the Buganda Road Chief Magistrate’s Court on grounds that it was tantamount to contempt of court order.
Simba Properties Investments Co. Limited borrowed $10million from Vantage to finance their real estate business including Skyz Hotel in December 2014.
They were supposed to start paying back the interest but until now, they have paid neither the interest nor the principal. The loan has since grown to US$34million.
As security for the loan, they offered their shares in Linda Properties Limited, Elgon Terrace Limited, and Simba Properties Investments Co. Limited and Simba Telecom Limited. The agreement also prohibited the transfer or change of the charged shareholding in the Simba Companies.
However, the two reportedly changed the shareholding allegedly with the view of defrauding Vantage.
Following this, Vantage and six others including its lawyers dragged Bitature and his wife Carol to Court for fraudulently changing the shareholding of the above companies contrary their loan agreement .The criminal proceedings before Buganda Road Magistrate’s Court state that.
However, Bitature went to the commercial court to block the Vantage case from proceeding on grounds that both parties were already solving their disputes through negotiation as per a high court ruling. The High Court had previously ruled that it had no jurisdiction to hear the conflict due to a negotiation clause in the loan agreement.
Bitature therefore argued that Vantage was going against the court ruling.
But in his ruling, , High Court judge Steven Mubiru dismissed Bitature’s petition with costs to his lawyer Fred Mwema of Muwema & Co. Advocates for misleading their client.
Justice Mubiru said for anybody to apply for interim orders stopping a lower court from proceeding with a matter they must have a properly filed suit before the lower court. He argued such an injunction aims to preserve the status quo by preventing one party from committing, repeating, or continuing a wrongful act prior to the trial.
“The application catastrophically lacks a legal basis. Consequently, the application is hereby dismissed. There must be a subsisting suit pending before the court, from which the application is sought, that forms the basis from which the interlocutory application arises.The affidavit in support of the application cites Miscellaneous Application No. 408 of 2022 as the pending application for contempt of court order to issue against the respondents. Examination of the Electronic Court Case Management Information System (ECCMIS) of this court reveals that both at the time of hearing and at the time of writing this ruling, no such application has been registered.” He said
He further blamed Bitature’s lawyer for misleading court and their client on a matter they know is not true.
“An advocate should not be held to have acted unreasonably simply because he or she acted for a client who has a bad case, but it would be quite different if the advocate gives his or her assistance to proceedings that are an abuse of process. I find that in filing this application, the advocates’ default rises to a “rare and exceptional The legal costs and time wasted in this litigation could have been avoided entirely if the applicants’ advocates had discharged their duties to the expected minimum standards of professional competence. He said
The battle between both companies started with an advert to auction some of Bitature’s properties if he failed to pay his creditors in 30 days.
Bitature contended that the advert was malicious and aimed at tarnishing his good name.
Through his lawyers , Bitature run to court arguing that Vantage had no legal claim over Bitature because high court had ruled that the company had no legal basis in Uganda to sue or be sued because it was not registered.
