WHO IS FOOLING WHO? Is Hamis Kiggundu, a patriotic Ugandan or a dishonest borrower hiding behind the law? The Latin maxim 'semper necessitas probandi incumbit ei qui agit' essentially means 'he who asserts must prove. It is interpreted to mean, ‘he who asserts/alleges must prove.’ This has been the accepted legal burden of proof in justice systems, the world over, for centuries. The whole reasoning behind this is that to minimise costs and damage, but to also discourage unfair accusations, the legal duty of burden of proof must always lie on the accuser to prove beyond a reasonable doubt, the veracity of their claims.

As such, during the entire lifetime of a case- the accuser, also known as the plaintiff, dedicates huge amounts of effort, time and resources to prove their case, while the defendant or the accused, equally dedicates a lot of time trying to poke holes in the alleged evidence being presented by the court, to prove themselves innocent.

But the case of businessman Hamis Kiggundu against two banks—Diamond Trust Bank Uganda (DTB Uganda) and Diamond Trust Bank Kenya (DTB Kenya) has defied all common sense. It is one of those rare occurrences, where the accuser has instead fought so hard to stop the court from trying to help him prove that indeed the two banks siphoned money from his accounts as he has told everyone who wants to hear.

And it is not small money- that we are talking about here. We are talking of UGX120,000,000,000!!

And if you consider the fact that the same businessman, is being pursued by three banks and other money lenders, for debts of up to USD18 million (UGX64 billion), you would think he would be very interested in quickly having a court-ordered independent audit into his accounts so that the alleged ‘thieves’ as he has branded the two-sister DTB banks can be caught and made to pay for their sins.  

So, when the businessman, commonly known as Ham, the proprietor of Ham Enterprises and Kiggs International openly rejected a Wednesday, 5^th May 2021 ruling by the Court of Appeal to have his case sent back to the High Court for retrial, something; in fact a lot, did not add up.  

The ruling, in Civil Appeal N0.242 of 2020 (DTB Uganda and DTB Kenya vs Ham Enterprises Ltd & 2 Others) emanates from a case in which the businessman, through his two businesses, Ham Enterprises Ltd and Kiggs International borrowed money from DTB Uganda & DTB Kenya, altogether, a total of USD10 million and failed to pay back. When in November 2019, the banks commenced recovery proceedings against him, in response, the businessman, in January 2020 went to court.

In Civil Suit No 43 of 2020, the businessman sued the banks for among others, a breach of loan agreements. But perhaps more conspicuously, he also alleged that the banks had irregularly debited and recovered monies from his accounts to the tune of UGX34,295,951,553/= and USD. 23,467,670.61, altogether equivalent to UGX120 billion, from the company’s accounts over ten years.

A UGX120 billion pat on Ham’s back

As expected, the banks filed a joint written statement of defence, strongly denying the allegations. Instead, they said that it was the businessman and his companies that were indebted to them for various credit facilities lawfully extended to him.

To prove the alleged unlawfully debits, the Commercial Court’s Justice Henry Peter Adonyo (as he then was) had on 31st of August 2020 directed that the Institute of Certified Public Accountants of Uganda (ICPAU) appoint an independent auditor to determine if indeed Ham’s money had been siphoned off as he alleged.  Surprisingly, on 15th September 2020 Ham through his lawyers asked the court to strike down the independent audit and to both the chagrin of the two banks but shock as well, on 30th September 2020, Justice Adonyo agreed to rescind his orders for an independent audit.

Just as the banks were digesting the shock, on 7th October 2020, Justice Adonyo, went ahead and agreed with Ham’s lawyers, and struck out the banks’ defence against Ham’s allegations. This paved way for him to declare that the two loans, obtained by Ham, had been settled at law and that the banks should give back the businessman his land titles, pledged as collateral.  

The banks were also ordered to repay the businessman- the allegedly stolen UGX120 billion, even though he was never put under any obligation to prove the same. In fact, you could say the court assisted him to avoid having to prove that money had been stolen from him.

And just like that, the businessman, by a stroke of Justice Adonyo’s pen, was absolved of a debt of USD 10,989,044, was allowed to pick his property titles and in addition, was given a UGX120 billion pat on the back! 

Ham tries to secretly transfer suit properties back into his names 

As expected, the banks appealed Justice Adonyo’s decision of the High Court contending among others that the learned trial judge erred in law and fact in striking out the written statement of defence and finding that the sums UGX34,295,951,553/= and USD 23,467,670.61 were unlawfully taken from Ham’s loan accounts without evidence.

But even before the appeal commenced, following a public outcry against the ruling, the Principal Judge recalled the file and on October 13^th made an interim order for a stay of execution of the decree in High Court Civil Suit No. 43/2020 and MA No. 654 of 2020 pending the determination of the main application for stay of execution by the banks.

While delivering his final ruling in the application to stay the execution of Justice Adonyo’s ruling, Dr Flavian Zeija said that he had learnt of a secret move by Ham to repossess the suit properties within just days of the ruling.  

“Counsel for the respondents (Ham) had secretly extracted an order on the day I issued an interim order (October 13^th), which was filed and signed by an Acting Registrar, Lilian Bucyana on the 12th October 2020, without input from counsel for the applicants (DTB Uganda and DTB Kenya) and without court files because the files were already in my custody,” said Dr Zeija.

The three properties in question are Ham Towers (LRV 3716 Folio 10), located on Plot 923, Block 9, Makerere Hill Road;  a residential property at Kawuku (FRV 1533 Folio 3) located on Plots 36-38, Victoria Crescent II Kyadondo; and Land at Kawuku, Ggaba (Block 248 Plot 328) on the shores of Lake Victoria.  

According to Dr Zeija, the law governing the extraction of decrees requires the victorious party in a suit to extract decrees from the ruling for approval by the court registrar but the losing party must be involved and consent to the said order, but Hamis’ lawyers decided to go it alone.

“It should be noted that the law governing the extraction of decrees and orders is set out in Order 21 Rule 7(2) and 4 which provides: It shall be the duty of the party who is successful in a suit in the High Court to prepare without delay a draft decree and submit it for approval of the other parties to the suit, who shall approve it with or without amendments, or reject it without undue delay. If the draft is approved by the parties, it shall be submitted to the Registrar who, if he or she is satisfied that it is drawn up in accordance with the judgement, shall sign and seal the decree accordingly. If all the parties and the Registrar do not agree upon the terms of the decree within such time as the registrar shall fix, it shall be settled by the judge who pronounced the judgement, and the parties shall be entitled to be heard on the terms of the decree if they so desire,” Zeija went at length to explain.

The Principal Judge then said that it was partly for this reason that he was allowing a stay of execution of Justice Adonyo’s orders.

He also said that under the circumstances, there was a great risk that Ham would go ahead and transfer the titles into his names, which would defeat justice.

“ This presents a very great risk as these titles can be transferred upon release of the mortgages and defeat the only security the applicants (banks) have against the respondents (Ham)” said Zeija, adding: “Execution (of Justice Adonyo’s orders) therefore, was a big possibility hence a risk.” 

Delivering his ruling, Dr Zeija said he was “flabbergasted” and “disappointed” that one of the parties had attempted to bribe him to influence his decision. Although he didn’t say who, many fingers pointed at the party who stood to lose and indeed lost from his decision.  

Zeija also took time to criticise Justice Adonyo’s one-sided orders, specifically his finding only one party guilty in a transaction that he had ruled illegal arguing that: “it will be an important question of law for the court of appeal to determine as to whether the illegality did not apply” to Ham or whether Hamd was “one of those protected by the law the parties were found to have violated.”

He also said that Adonyo’s ruling had “far-reaching implications on the banking industry in as far as it declares syndicated loans illegal.” He also wondered why the court awarded Ham, UGX 34,295,951,553/= and USD 23, 467, 670.61 being money that the businessman alleged was unlawfully deducted from his accounts by the banks, without subjecting the businessman’s claims to proof or evidence thereof.   

“In view of the fact that the parties had agreed in the Joint Scheduling Memorandum to have an Audit to ascertain the amount deducted from the plaintiffs’ account vis-a-vis what they received and the trial Judge (Justice Adonyo) had appointed ICPAU to conduct the Audit, which orders he vacated, it remains to be determined by the Court of Appeal as to whether this was actually a liquidated sum that would be awarded without formal proof,” he opined. 

Court of Appeal attempts to end Ham’s nine lives; but will it?  

With the stay of execution granted by the Principal Judge, the banks then went ahead to appeal. The Appeal was heard by the Court of Appeal and on 5^th May 2021, the Court delivered its judgment in the matter where it found that the procedure under which Justice Adonyo had disposed of the matter and entered Judgment in Ham’s favour was strange, erroneous and severally contravened the Civil Procedure Rules. The Court also found that the trial Judge was wrong in ordering the Banks to pay the claimed sums without hearing the evidence.

The Court of Appeal also proceeded to order that Justice Adonyo’s judgment and orders of the High Court be set aside and that Ham should bear the costs of the appeal.

They also ordered that Ham’s original case against DTB Uganda and DTB Kenya (Civil Suit No 43 of 2020) be remitted back to the Commercial Division of the High Court to be expeditiously fixed and heard by another Judge.

But more importantly, the High Court proceedings were to commence based on Ham’s original pleadings, whose crux was the unlawful deduction of money from his accounts. All other pleadings and statements made by both parties after that were struck from the record.  

Simply interpreted, the Court of Appeal said that Ham can proceed with his claim for money against the banks based on the original claims. But here is the catch, to do that, he would have to prove beyond reasonable doubt that indeed money was debited off his account irregularly or wrongfully.

Wilbrod Owor the Chief Executive Officer of the Uganda Bankers Association welcomed this ruling.

“As an industry, we welcome the ruling of the Court of Appeal and look forward to having the matter concluded in the next session of the Commercial Court where it has been referred back to,” he told CEO East Africa Magazine.

Under normal circumstances, Ham too should have welcomed the Court of Appeal ruling, since an independent audit would now quickly assist him to prove if at all it is true, that his UGX120 billion was stolen and it would be returned to him, which would, in turn, make the repayment of USD10.9 million painless.

But as it is, Ham doesn’t want to hear anything about the Court of Appeal ruling and has indicated he will appeal that ruling, while still insisting his money was stolen. This now begs the question: Why does Ham not want evidence to be called to show how the alleged money was debited off his account? That would be the wish of any plaintiff, who would now have the golden chance to show court and the world that he was wronged by the banks.

Rejecting that position points to only one conclusion- such evidence is most likely non-existent.

This begs another even bigger question: Is Hamis Kiggundu the honest, hardworking and patriotic Ugandan that he claims to be— one who is helping Ugandans to fight back against what he calls an extortionist banking industry, dominated by foreigners, or is he a dishonest and shady businessman who is trying to use excessive lawyering, to ride upon a genuine issue of the expensive cost of money, to hoodwink gullible Ugandans into supporting his otherwise dubious and fraudulent agenda of avoiding repaying his debts?

The answer to this question could lie in his past behaviour with other banks, because this is not the first time for Ham to borrow from a bank and then turning around, using the law to prolong the payment process.

For example, at the time he was still negotiating for leniency from DTB Uganda and DTB Kenya, before he went rogue against them, around March-April, Ham sought and obtained another loan of USD7,000,000 from Absa Bank Uganda in March 2019. Hamis pledged as collateral, land and property on Plot 25B, Folio 23, Nakivubo Place and Plot 2 Folio 5, Nakivubo Close. It shall be remembered that this land containing the Government-owned Nakivubo War Memorial Stadium had, through the influence of Statehouse been given to the businessman for redevelopment on a build, operate and re-transfer back to government basis.  

How he turned around and parcelled it into different chunks and used it to obtain a mortgage is a story of its own altogether- but just one month after the USD7 million facility, in April 2019, he returned to Absa, to borrow yet another USD17 million, this time as equity release on the Nakivubo stadium land.  But along the way- it is understood that the board credit committee at Absa Bank declined to give the loan the final nod.

By this time the original Absa Bank USD7 million facility was dangerously in arrears and in October 2019 Absa issued Ham with a default notice of USD6,789,252.

Ham, would then turn to the court, first, suing Absa for declining to grant him the extra USD 17 million (Civil Suit No. 943 of 2019), even when the first facility was already going bad. Armed with this suit, he then again went to court, this time, seeking to bar Absa from moving to recover the USD6,789,252.  

“A temporary injunction issues, restraining the respondent, its agents and or employees from advertising for sale, selling or dealing in any way with the suit property, comprised in plot 26B, Folio 23 Nakivubo Place and Plot 2 Folio 5, Nakivubo Close until the determination of the main suit (legal Mortgage created 4/3/19 for USD7 million),” Ham prayed to Court.

Although Lillian Bucyana, the then Acting Assistant Registrar on 11^th December 2019 granted Ham the desired injunction, it was conditional upon him depositing with the court, 30% of the contested amount within 45 days- some USD 2,036,776! For a severely cash-constrained Ham, this was too much to handle.  

Within days of this court ruling, two Ugandan citizens, George Nyanzi and Joseph Asiimwe emerged out of nowhere and sued Ham Enterprises alongside the trustees of the stadium, Absa Bank Uganda, Kampala District Land Board and the Commissioner Land Registration jointly and severally for conniving to mortgage government land. The duo argued that the land that Ham had mortgaged, was “statutory property owned by Nakivubo War Memorial Stadium Trust and is protected as public property under Objectives and Directive Principles of State Policy and Articles of the Constitution of the Republic of Uganda.

They also asked the court to cancel both the lease on the land as well as the mortgage attached to it as anything to the contrary contravened the constitution of the Land.

Whereas there are no direct links between Ham Enterprises as being the sponsor of this case, the fact that the net effect of cancelling the Nakivubo leases and mortgages would benefit the businessman and the timing of the suit itself, it is highly likely that the businessman could have a hand in this suit. 

But perhaps more importantly, that George Nyanzi and Joseph Asiimwe were represented by Muwema & Co. Associates and Solicitors, who went on to become Ham’s lawyers against DTB Uganda and DTB Kenya, a couple of weeks later, strengthen this theory.

But anyway, to cut the long story, short, it appears this case never took off.

But with the 45 days given by the court for Ham to raise the USD 2,036,776 deposit for the court to be able to grant him an injunction against Absa selling his Nakivubo land and with no money in sight, Ham instead on 21^st January 2020 entered into a consent judgement with Absa Bank.

He conceded and agreed to drop all cases against Absa in exchange for them to drop any cases and claims against the bank. In exchange, the bank relaxed the default notice and gave him a chance to resume repaying the bad loan at a rate of USD126,000 monthly, with effect from 20^th February 2020 until it was repaid in full. Additionally, he was compelled to resume collecting all the rent from the suit properties through Absa, as he had done before July 2019.    

But with the Court of Appeal ruling, Ham’s nine lives are getting used up. Now there are only two steps left- either the Supreme Court where a final and final decision will be made on the matter or agreeing to the Court of Appeal’s decision and have a retrial at the Commercial Court.

From the look of things, both, Ham’s harm on the banking industry and his nine lives could be at their tail end.

But again, Ham, his bag of tricks and his immense risk appetite cannot be underestimated!