The Commercial Court Judge, Justice David Wangutusi has ordered city lawyers to stop representing any entity seeking legal action against Crane Bank.
Crane Bank was taken over by DFCU Bank in 2007 under the supervison of Bank of Uganda (BoU) which sparked off a commercial litigation process with property mogul Sudhir Ruparelia contesting the ‘hostile takeover’ of his financial institution.
Suing both the regulator (BoU) and DFCU, the banks hired renowned city lawyers Timothy Masembe and David Mpanga as their lead counsels.
However, Sudhir filed a legal suit against the lawyers asking court to bar the duo from representing these banks citing conflict of interest.
Sudhir had previously hired them as their client.
In December 20, 2017 the same judge disqualified MMAKS Advocates from representing Bank of Uganda which is up to now battling Sudhir in Court.
The lawyers however threatened to appeal the ruling in a higher court.
In a ruling delivered read on Tuesday, January 15th by the Court’s Deputy Registrar arising out of a case filed against DFCU by Shakil Pathan Ismail a former Crane Bank employer.
He accused DFCU of failing to clear his salary which accumulated to a tune of shs 62 million after DFCU had taken of assets and liabilities of Crane Bank.
In his ruling, Justice Wangutusi ordered DFCU to pay shs 62 million to the applicant and also clear court costs of shs 20 million.
He further expressed his position on lawyers MMAKS as:
Lastly the Application to add Crane Bank in Receivership was filed by MMAKS Advocates.
This very firm having represented Crane Bank for several year before it fell under could not again turn and file suits against the same bank albeit in receivership.
This matter was settled in Misc. Application No. 1063 of 2017 arising out of Bank of Uganda vs Crane Bank Civil Suit No. 493 of 2017 wherein the court found MMAKS in conflict of interest. Court held that;
“It did not matter whether the firm had many lawyers and the one now assigned with the new matter did not personally handle the complainant’s earlier case. Conflict would still be imputed from the “Canteen factor.”
“Canteen factor in this case included social chat between colleagues or with client that gives away vital information. So if the interaction is between one of the partners, it will be imputed to the others.”
For those reasons MMAKS Advocates who had been Counsel of Crane Bank
were declared “interest conflicted” in that Bank’s case.
Following that ruling this Court could now not turn around and proceed with an application brought in by MMAKS intending to bring Crane Bank on board as a Defendant.
