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Court
has moved to compel Bank of Uganda and DFCU Bank to pay Shakil Pathan Ismail, a
former employee of the defunct Crane Bank Limited who won a Shs82m case against DFCU Bank in January. Shakil sued the bank for
unlawfully blocking/deducting Shs62m from his account.  

Since
the ruling delivered by the Head of the Commercial Court, Justice David
Wangutusi who ordered DFCU to pay Shakil his Shs62m, which also attracted 21
per cent interest per annum from April 2016 on till payment is made in full, no action has been taken to the effect.

Wangutusi had
also awarded damages of Shs20m and also
ordered the bank pays a further 6% interest on damages from the date of
judgement till the amount is fully paid.  The judge also ruled that DFCU
meet Shakil’s costs of the suit. Shakil is yet to receive his payment more than
four months after the ruling and has made an application to court, to ensure he
receives his payment.

Hence,
on Friday, May
24, High Court deputy registrar Flavia Nabakooza commanded both Bank of Uganda
and DFCU Bank to appear before court on June 4, to show cause why their
accounts should not be attached.

The
money is held by BoU as the garnishee and DFCU bank is the debtor.

“An
order Nisi doth issue against the garnishee to appear before this Honourable
Court on the 4th day of June, 2019 at 11.30am to show cause why the
money it holds on the judgment debtor’s account should not be attached and paid
to the judgment creditor,” Nabakooza wrote.

The
costs of Shakil’s application to have his money paid are to be met by DFCU.

Background

In 2017, Shakil sued DFCU Bank for
the recovery of Shs62m, which he said the bank unlawfully blocked/deducted from
his salary account.

In their defence DFCU contended that
they are not successors in title to Crane Bank Limited but only acquired some
of its assets and liabilities in 2 January 2017.

However in his January 2019 judgement, Wangutusi ruled that Shakil was not privy to the
Purchase of Assets and Assumption of Liabilities Agreement Purchase of Assets
and Assumption of Liabilities Agreement and that legally DFCU assumed the
position of Crane Bank when she took over the Bank.

“This position is buttressed by the
Employment Act. Section 28(2) provides;

‘Where a trade or business is
transferred in whole or in part, the contracts of service of employees employed
at the date of transfer shall automatically be transferred to the transferee,
all rights and obligations between each employee and the transferee shall
continue to apply as if they had been rights and obligations concluded between
the employee and transferee.’

 The relationship between the
Plaintiff and Crane Bank simply shifted to DFCU by operation of the law. This
position would however have been changed if the Plaintiff had been privy to the
Purchase of Assets and Assumption of Liabilities Agreement,” Wangutusi ruled.

While awarding interest,
Wangutusi ruled that; “It is without doubt that the defendant kept the
plaintiff (Shakil) out of use of his money. The bank must have used this money
for commercial purposes. It is also without doubt that if the plaintiff had
borrowed that money from the bank, he would have paid it back at commercial
interest rate. What is good for the goose should also be good for the gander.”

The ruling meant that DFCU Bank can suffer all the previous
liabilities inherited from Crane Bank provided the victims of these liabilities
were never privy to the purchase of Crane Bank assets and liabilities.

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