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Sudhir Sues BoU for Breach of Agreement; Demands $8M

Sudhir Ruparelia

Businessman Sudhir Ruparelia has filed a counter-suit before the Kampala High Court against Bank of Uganda (BoU) and Crane Bank Limited (CBL), seeking to be repaid USD 8Million (about Shs 29billion) in accordance with an agreement he had signed earlier with the two.

Sudhir accuses BoU and CBL of breaching mid-implementation, the agreement under which he had so far paid them the $8million.

In March this year, the tycoon on one hand, and BoU and Crane Bank on the other, entered a Confidential Settlement and Release Agreement (CSRA).

The agreement was hoped to save the two parties a long and protracted legal battle after they came at him with accusations that he mismanaged and misappropriated hundreds of billions of Shillings from CBL.

Under the CSRA, Sudhir undertook to pay to pay CBL through BoU $60Million (About Shs. 217billion) in cash and real property, in a specified number of instalments.

At first he was to pay $8million (in 30days after the signing the agreement), and later (within 90days) another $10million.

The balance of $42million he was to pay by surrendering his properties worth the amount.

The agreement was that Sudhir provides the Central Bank with a list of properties, which were to be valued by a team of valuers (appointed by the two camps) and Bank of Uganda would put these properties up for sale to recover the $42million.

In return for the above payments, BoU and CBL were to assign a number of loans totalling Shs. 63.6billion to Sudhir, release all securities of these loans, and remove Crane Bank from receivership.

In simple terms, Shs 63.6billion worth of loans in Crane Bank would be transferred to Sudhir to manage them.

Bank of Uganda was expected to hand over to Sudhir copies of all loan files and records relating to the agreed files by April 11th.

Upon receiving the first instalment of $8million from Sudhir, BoU was expected to release securities of loans representing a total value $8million.

These titles are land and properties located on Plot M418 Industrial Area, Nakawa and Plot 7 on Parliament Avenue.

On April 20th, 2017, Sudhir says he paid up the first instalment of $8million and the payment was acknowledged.

At this point, BoU and Crane Bank were supposed to release the securities of loans worth $8million to Sudhir as agreed, which they didn’t and have never.

Meanwhile, Sudhir says as agree upon in the CSRA, he went ahead and provided a list of properties to BoU to be valued and placed on market.

Among these properties however, was one in the names of one Mahmood Bharwani, which BoU and CBL raised concerns about.

Sudhir says he added another 8 titles to the property list to give them comfort but the two rejected this and a joint evaluation of Bharwani property, and instead set their own demands, which were not provided for in the CSRA.

On May 29th, before the next instalment of 10million was due, BoU Governor Tumusiime wrote to the Attorney General, informing him that he had instructed the Central Bank lawyers to file a civil suit against Sudhir, claiming that the CSRA “had been repudiated.”

One month later on June 28th, Sudhir said he was informed by BoU lawyers of their intention to sue, unless among others he undertook to pay in cash, the remaining balance of $52million. He says he wrote back expressing commitment to the CSRA, and on June 30, he was formally sued before the Kampala High Court.

According to Clause 7 of the March agreement, the two parties had undertaken “not to sue…or prosecute against any other party…concerning the related claims, in Uganda or in any other jurisdiction.”

Under the March SCRA, it was agreed that in the event of breach of the agreement, efforts were to be made to amend the contentious clause(s), or if necessary delete (them). If the agreement totally collapsed, Bank of Uganda and Crane Bank were to repay Sudhir all the money that he would have deposited at that time.

In his countersuit, Sudhir now wants to be paid back his $8million.

He also wants BoU and CBL to release to him as agreed, the titles and mortgages on land and properties (in Industrial Area and Parliament Avenue.)

On top of this, Sudhir seeks to be awarded general and aggregated damages and costs with interest.


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