UGANDA, Kampala | Real Muloodi News | The Supreme Court has recently made a ruling in the case between Meera Investments and businessman Sudhir Ruparelia against the Bank of Uganda (BoU), reducing the award for instruction fees to USh500m.
This decision comes after the initial instruction fees of USh45b, previously awarded by the court’s registrar to the lawyers, was deemed excessively high by Justice Mike Chibita, who presided as a single judge.
Justice Chibita explained that since the appeal by Crane Bank in receivership was withdrawn prematurely, the amount of work carried out by the lawyers was significantly reduced.
In his ruling, delivered by a registrar on May 5, Justice Chibita stated, “The appeal in issue was withdrawn before hearing, therefore, not as much work was done by the advocate in this court as would have been if the appeal had been argued to its logical conclusion.”
He further emphasised that instruction fees should strike a balance, ensuring accessibility to the courts while still providing fair compensation to the lawyers.
Consequently, he set aside the previous sum of USh45b and replaced it with an award of USh500m to Sudhir, considering the circumstances.
Instruction fees refer to the remuneration paid to an advocate for the work undertaken on a specific case. The complexity and extent of the work carried out by the advocate play a crucial role in determining the quantum of instruction fees.
Justice Chibita acknowledged this factor in his ruling, highlighting the importance of considering the difficulty of the case and the effort exerted by the lawyer.
Justice Chibita also rejected two instances of what he termed “double taxation” and awarded the lawyers USh5m each for the interlocutory applications made during the case.
Moreover, the initial amount of USh50m awarded by the court’s registrar was set aside.
The legal battle originated from Crane Bank’s placement under statutory management by the Bank of Uganda on October 20, 2016, due to being undercapitalised.
Subsequently, under Section 94 of the Financial Institutions Act, Crane Bank was placed under receivership, and some of its assets and liabilities were sold to DFCU Bank.
In June 2017, Crane Bank, while in receivership, filed a commercial case before the High Court, Commercial Division, seeking to recover over USh397b from Mr Sudhir Ruparelia, alleging misappropriation of funds as the director and shareholder of Meera Investment Company.
However, in August 2019, Judge David Wangutusi dismissed the multi-billion commercial dispute, ruling that Crane Bank in receivership lost its legal capacity to sue or be sued when placed under receivership.
Dissatisfied with this decision, Crane Bank in receivership appealed to the Court of Appeal, which upheld the dismissal based on similar reasons.
Finally, Crane Bank in receivership appealed to the Supreme Court, but the main appeal was withdrawn before it could be heard.
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