Uganda’s Court of Appeal has stepped into a long-running commercial dispute involving billionaire businessman Amos Nzeyi, halting the enforcement of a USD 230,000 (approximately UGX 870 million) payment tied to a controversial share sale agreement linked to a failed Nando’s franchise arrangement.
In a ruling delivered in April 2026, a panel of three Justices of Appeal reversed an earlier decision by a single justice and granted a stay of execution, effectively suspending payment of the disputed sum until the substantive appeal is fully heard and determined.
The decision marks a significant development in a case that blends corporate governance, franchise law, and high-stakes shareholder relations—while also underscoring the judiciary’s willingness to intervene where commercial fairness is in question.
A Deal That Unravelled
At the heart of the dispute is a share sale agreement between Amos Nzeyi and his former business associate, Menna Tewahade. The two were shareholders in Innscor (U) Ltd, a company that operated a Nando’s Chicken franchise in Uganda.
Under the agreement, Tewahade agreed to sell his shares to Nzeyi for USD 400,000, payable in instalments. Nzeyi paid an initial USD 100,000, but the transaction quickly ran into complications that would later define the dispute.
The complication stemmed from the underlying Master Franchise Agreement (MFA) between Innscor and Nando’s B.V. of the Netherlands. This agreement imposed strict restrictions on the transfer of ownership, including a requirement that any change in shareholding receive prior written consent from the franchisor.
That consent was never obtained.
Instead, the parties proceeded with the share sale in breach of the MFA. Once the franchisor became aware of the transaction and the respondent’s resignation, the franchise agreement was terminated, effectively stripping the business of its core commercial value before the transaction could be completed.
From Commercial Dispute to Courtroom Battle
Following the breakdown of the franchise relationship, Tewahade sued Nzeyi for the balance of the purchase price. The High Court ruled in his favour, ordering Nzeyi to pay USD 230,000 as the outstanding consideration for the shares.
Nzeyi challenged the decision, filing an appeal and simultaneously seeking to stay execution of the judgment. His application for a stay was first dismissed by the High Court and later by a single justice of the Court of Appeal.
Unwilling to concede, Nzeyi invoked his right to a reference—asking a full bench of the Court of Appeal to reconsider the decision of the single justice.
The Legal Battle: Risk, Loss, and Fairness
The central issue before the Court of Appeal was whether the single justice had properly exercised judicial discretion in refusing to grant a stay of execution.
Nzeyi’s legal team argued that enforcing the payment before the appeal was heard would expose him to substantial and potentially irrecoverable loss. They pointed out that Tewahade now resides in the United States and may not have assets within Uganda to facilitate a refund if the appeal succeeds.
More critically, they argued that the payment of the balance was tied to a key condition: the renewal of the Nando’s franchise agreement. Since that renewal never occurred, Nzeyi maintained that the obligation to pay the balance had not crystallized.
The respondent, however, countered that Nzeyi had failed to prove any real risk of loss. He argued that a money decree does not ordinarily result in irreparable damage and that Nzeyi remained in control of the company, with access to its underlying assets.
He further maintained that he had already been deprived of the purchase price for over a decade and was entitled to enjoy the fruits of his judgment.
Court of Appeal Weighs In
In its ruling, the Court of Appeal reaffirmed the well-established principles governing applications for stay of execution. These include the requirement to demonstrate a prima facie case, the risk of irreparable harm, and the balance of convenience between the parties.
The court noted that the single justice had correctly outlined and applied these principles. However, it found that a crucial aspect of the case had been overlooked.
Victoria University Appoints Meera Ruparelia to Council, Signalling a New Era of LeadershipSpecifically, the court highlighted the parties’ own agreement that payment of the balance was conditional upon the renewal of the Master Franchise Agreement—an event that never occurred.
This omission, the court held, was material.
The judges observed that both parties had knowingly entered into a transaction that breached the franchise agreement, leading to its termination. They also noted that Tewahade had already received close to half of the total purchase price.
In that context, requiring Nzeyi to pay the remaining balance before the appeal is determined would, in the court’s view, unfairly tilt the scales in favour of the respondent.
A Question of Commercial Equity
Beyond the technical legal analysis, the ruling reflects a deeper concern with commercial equity.
The Court of Appeal was careful not to prejudge the merits of the underlying appeal. However, it signaled that enforcing the payment at this stage—without resolving whether the conditions for payment had been met—would risk creating an unjust outcome.
Even the respondent’s continued ownership of the shares, which could theoretically be attached to recover the money, did not sway the court. The judges emphasized that fairness required preserving the status quo until the appeal clarifies the parties’ rights and obligations.
The Decision
In the end, the Court of Appeal allowed Nzeyi’s application, setting aside the earlier ruling of the single justice and granting a stay of execution.
This means that enforcement of the High Court judgment—requiring payment of USD 230,000—is now suspended pending the determination of the main appeal.
Costs of the application were ordered to abide the outcome of the appeal.
Broader Implications
The case carries important lessons for Uganda’s business and legal communities.
First, it highlights the risks of structuring transactions that conflict with underlying contractual obligations—particularly in franchised businesses where control over ownership is tightly regulated.
Second, it underscores the courts’ role in balancing strict legal rights with broader considerations of fairness, especially in complex commercial disputes.
Finally, the ruling reinforces the principle that appellate courts will intervene where judicial discretion, even if properly framed, fails to account for material facts.
What Next?
All eyes now turn to the substantive appeal, which will determine whether Nzeyi is ultimately liable to pay the remaining balance under the share sale agreement.
For now, however, the Court of Appeal’s decision offers temporary relief to one of Uganda’s most prominent businessmen—while keeping a closely watched commercial dispute firmly in the legal spotlight.
