City businessman Sudhir Ruparelia has asked court to stop city law firm, Ssebalu and Lule Advocates from representing dfcu Bank over conflict of interest.
Crane Management Services owned by Sudhir last year sued dfcu bank over rental arrears amounting to Shs2.9b and $385,728.54 in respect of tenancies of suit properties that were formally owned by Crane Bank and have since been sold to dfcu bank by Bank of Uganda.
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Ssebalu is representing dfcu in the matter.
On Wednesday, lawyer Joseph Kyazze, representing Crane Management Services told the Commercial Court that the law firm is conflicted having represented Sudhir’s companies since 2012 in a number of matters and subsequently cannot represent dfcu against the client he once represented.
“The applicant (Crane Management Services) and Meera Investments are part of the Ruparelia group in which the shareholders are the same. Since the first respondent (Ssebalu and Lule Advocates) acted for one company(Meera Investment), they acted on behalf of all the companies in the group,”Kyazze told court.
“All the companies were addressed through Ruparelia group and not as individual companies as the respondent (Ssebalu and Lule Advocates) alleges.”
The lawyer explained that the law firm was contacted in regards a review of tenancy agreements for Meera Investments, the same matter both Crane Management and dfcu are battling over in the main case.
Kyazze presented an email dated February 17, 2016 in which Ssebalu and Lule Advocates were given instructions by Meera Investments and a February 26,2016 letter in which the law firm was asked to review several tenancy agreements.
“He was tasked to draft the tenancy agreements into the simplest forms and was paid for the services rendered. He promised to always be available for consultancy and advice. By representing dfcu in a matter regarding the same tenancy agreements, there exists an advocate-client relationship in which confidential information was discussed between the two and the same information might be used to our disadvantage in the main case.”
Sudhir’s lawyers insisted that the law firm is conflicted and can therefore not be the same to represent dcfu in the main suit.
Kyazze said Ssebalu and Lule Advocates breached regulations 4,9 and 10 of the Advocates Rights by accepting to represent dfcu yet he knows he is conflicted and is privy to confidential information that might be useful in the case between the two entities.
“The law says where there is apparent conflict, the only remedy for the lawyer id to dismiss themselves from the case but if they refuse, court must disqualify the advocate. We ask this court to do the same with costs,”Kyazze told court.
However, Ssebalu and Lule’s lawyers led by Peter Walubiri told court there is no legal provision stopping an advocate from practicing their profession and on the other side, a client has a right to be represented by an advocate of their choice.
“The fact that one time he represented that client does not bar him from advocating against the same client,”Walubiri said.
Walubiri asked Sudhir’s lawyers to provide proof that there is confidential information that will be passed on to dfcu by the lawyers as alleged in the application.
“They(Crane Management Services) have the burden to particularize the information which is confidential and would be passed onto dfcu .”
The lawyers asked court to dismiss the application with costs.
Commercial Court justice, Paul Gadenya set April 24,2019 as the date to give his ruling on the matter.
