BY JACOBS O. SEAMAN
The Commercial Court in Kampala has dismissed two lawyers from representing Bank of Uganda in a case against businessman Sudhir Ruparelia, essentially snatching dream pay cheques the central bank was offering them.
In its ruling, the court agreed with Sudhir that David Mpanga, of AF Mpanga Advocates, and Timothy Masembe, of MMAKS Advocates, were not legally qualified to represent BoU as lead lawyers due to conflict of interest.
The lawyers stand to miss out on the reported Shs5 billion that Bank of Uganda has been dolling out as it draws all daggers out against the tycoon.
In September, Sudhir, who was in the court to receive his festive gift in form of the ruling, filed an affidavit in court accusing MMAKS Advocates and AF Mpanga Advocates of conflict of interest and breach of advocate-client relationship on account of their past dealings with him and Crane Bank that he previously owned.
The two law firms had represented Sudhir and his bank for the 12 years and the businessman argued that such a relationship exposed them to confidential information from his side, which they could use against him in favour of BoU.
The two lawyers had defended their legality, saying they had represented Sudhir’s companies but not Sudhir the person and that there was a difference between the person whom the central bank is suing and the companies that had hired the lawyers over the years.
Justice David Wangutusi of the Commercial Court, was expected to determine if the two lawyers conflicted in changing allegiance and selling their services to BoU and Crane Bank in receivership against Sudhir yet they were representing Crane Bank before.
Thursday, the judge didn’t seem to have found any difficulty in determining the issue of conflict of interest in the case as deputy registrar Lillian Bucyana, who read the ruling on his behalf, put it.
“The first and second respondents (Timothy Masembe Kanyerezi and David Mpanga) represented Sudhir and he is their former client, so representing the current client (BoU) would be advantageous to them,” the ruling said.
“In the result, the first and second respondents are disqualified as being counsel for BoU.
Breaking Barriers: Charles Mudiwa on Intergenerational Leadership at Makerere The respondents said they would appeal the ruling before end of business today. And this will ruffle the businessman even further as he has already threatened to take issues with one of the law firms beyond Uganda to England where they are a member.
After the ruling, Sudhir said he would lodge a complaint with the law society of England where one of the conflicted lawyers is a member.
Bank of Uganda acquired the services of Mpanga and MMAKS to file a Shs400 billion suit against Sudhir, accusing him and Meera Investments Ltd of siphoning money from Crane Bank and contributing to its collapse.
When the details of the case were revealed to the public, Sudhir fired back and filed a counter claim against BoU.
Missing out on big money
On July 13, BoU, as Receiver of Crane Bank Limited and regulator of the banking sector announced it had sanctioned a suit against Sudhir and Meera Investments to recoup funds that “were fraudulently extracted from, as well as losses that were caused to Crane Bank.”
The central bank claims in its affidavit that it seeks to recover a total of $93.8 million and Shs60.3 billion, together with the freehold titles to Crane Bank’s branches, general damages, interest and costs.
And to recover the said claims, the central bank has let loose its treasury, dolling out Shs5 billionin paying law firms AFK Mpanga Advocates and MMAKS Advocates as well two international audit and accounting firms, PriceWaterHouse Coopers (PwC) and Klynveld Peat Marwick Goerdeler (KPMG).
According to documentary receipts, invoices and other documents previously published by local news portals, BoU paid out a total of $804.094 to the law firms.
