UGANDA, Kampala | Real Muloodi News | Meera Investments Ltd, the property subsidiary of tycoon Sudhir Ruparelia’s Ruparelia Group, has slapped dfcu Bank with a bill for $8,660,462 (Sh32 billion) in rent arrears. dfcu took over management of his defunct Crane Bank Ltd in January 2017.
According to court documents filed before the Commercial Division of the High Court, Meera Investments Ltd says the amount is in breach of the tenancy agreements in respect to plots 38 and 40A on Kampala Road. Plot 38 Kampala Road was the headquarters of Crane Bank Ltd.
“dfcu Bank expressly inherited all tenancy agreements and, therefore, “assumed the rights and obligations under the tenancies in respect of the suit properties,” Meera Investments Ltd lawyers argued in their plaint in the case before the High Court’s Commercial Division.
“Under clause 3(c) of the tenancy agreement, it was specifically agreed by the parties (Crane bank and Meera) that the tenancies shall remain firm and binding on them until the expiry of ten years,” reads the plaint.
In the above tenancy agreement, Crane bank would pay $46,980 (Shs171m) in rent and $46,980 (Shs 171m) in ground rent per month with a seven percent annual increment for Plot 38 Kampala road and $9,890 (Shs36m) in rent and $9,890 (Shs36m) in ground rent for Plot 40A Kampala road.
At the time of the takeover, dfcu Bank inherited the entire premises previously rented by Crane Bank Ltd and rebranded the entire premises. dfcu Bank also undertook to pay to Crane Management Services (managers of Meera) $531,000 (Shs 1.93bn) in restoration costs and arrears in utility bills.
According to the plaint, dfcu Bank, in February 2017, entered into a revised contract in “respect of the basement and ground floors of Plot 38 Kampala road for a fixed period of three years.”
dfcu Bank, however, reportedly continued to occupy the1st, 2nd 3rd and 7th floors of Plot 38 Kampala road and Plot 40A Kampala road “under the terms and conditions of the tenancy agreement dated December 16, 2014” until April 30, 2017, when it opted to vacate them.
According to Meera Investments Ltd, this constituted a breach of clause 3(c) of the surviving tenancy agreement, that covenanted that the “tenancies shall remain firm and binding on them until the expiry of ten years” and for this breach, dfcu is “liable to pay the plaintiff the sum constituting rent for the unexpired period of 84 months being $8,660,462.34 (Shs 31.6bn).”
Meera Investments Ltd, now wants this money plus interest “at the prevailing commercial rate from the date the defendant was in default until payment in full.”
Meera contends that the non-payment of the rent has not only caused it losses, but also deprived it of use of its money and interest, caused it more suffering and grave inconveniences and adversely affected its damages which it claims general damages, and other orders of court. The dfcu Bank has been commanded to file a defence.
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