Housing Finance Bank has been dragged to the Kampala High Court over the sale of a prime property in Kampala which belongs to the family of the Late Eng. Sam Kwesiga.
Before he passed away in 2005, Eng. Kwesiga served as the Managing Director of the old Uganda Railways Corporation.
His widow, Mrs Ida May Kwesiga, in the law suit filed last Friday, is accusing Housing Finance Bank of flouting terms of a loan she secured from the bank in 2013, and proceeding to sell off the mortgaged property at a price much lower than its value.
The 1.4-acre plot of land located next to Ssanga Courts on Kyadondo Rd in Nakasero has 26 apartments on it.
Mrs Kwesiga according to the court papers, secured the a $2.72Million loan from HFB in June 2013, payable in 10 years. She needed the money to develop the apartments.
Before development in 2015, she says, the property was valued at $8million on open market and $5 million on forced market.
At the time it was sold off a few days ago, with its fully furnished apartments, Mrs Kwesiga says the property was valued by Alcent Land and Property Ltd at about $9.3 million on the open market and $7.3 on forced sale.
Mrs Kwesiga told court through her lawyers of Mpairwe & Co. Advocates that she was unable to pay off the loan in time because of “unconscionable terms of payment.”
Last year in September, HFB sent her a notice of sale of the mortgaged property and published an advert in the papers.
Mrs Kwesiga in response, rushed to High Court and secured an injunction to block the sale and have the mortgage terms reviewed.
However, on August 14th this this year, the bank proceeded to sell off the property to Balaji Group EA Ltd, the makers of Atis Mineral Water and Biscuits, at a measly $2.4Million.
The sale according to Mrs Kwesiga, happened without the bank re-issuing a default notice, or re- advertising or re-evaluating to ascertain the current market value of the property.
She adds that it came at the time when her businesses like most in the country were struggling because of the Covid19 economic effects.
It should be remembered that on multiple occasions, President Yoweri Museveni has asked Ugandan banks to restructure the terms of their loans bearing in mind the effects of the global pandemic.
In her law suit which is yet to be scheduled for hearing, Mrs Kwesiga wants court to set aside the sale of the property for “being unlawfully and fraudulently done.”
She also wants court to order the bank to allow her redeem the property by paying the sums due on her loan account.
“All I want is more time; they can’t just get rid of my property at a fraction of its value. I want a chance to redeem,” she told ChimpReports on phone.