UMSC bid to block sale of properties fails

UMSC bid to block sale of properties fails
Mufti Sheikh Mubaje

The Uganda Muslim Supreme Council (UMSC) recently lost an appeal in its attempt to halt the auctioning of several valuable properties to repay a debt of Shs19 billion owed to businessman Justus Kyabahwa.

The appeal was dismissed with costs.

In the application, UMSC requested a stay of execution of a warrant that granted Kyabahwa permission to attach nine properties and recover the money owed to him, which has been accumulating since 2020.

The properties set for auction include the land occupied by the Gaddafi National Mosque in Old Kampala.

In his ruling, Justice Christopher Gashirabake, determined that the balance of convenience favored allowing businessman Kyabahwa to proceed with the sale of UMSC's properties to recuperate 18.9 billion Shillings.

Justice Gashirabake stated that UMSC failed to demonstrate a likelihood of success in the pending appeal or prove that it would suffer irreparable harm that couldn't be compensated through damages.

"Clearly, denying this application for a stay of execution and allowing the party with the judgment to proceed with the execution process would strike a balance of convenience," he ruled.

"Consequently, this appeal is dismissed for the reasons outlined above. Costs will be determined based on the appeal's outcome."

Justice Gashirabake also found that UMSC presented insufficient evidence to support its claim of harm that couldn't be compensated through damages.

"The applicant has merely argued that if execution proceeds, it may never be able to recover its properties from third parties. In my view, the recovery of a property sold in execution and the atonement of damages that may result from it are distinct," Gashirabake stated.

He further explained that while it's possible for a judgment-debtor to be unable to recover a property sold in execution, any harm suffered can still be compensated through damages.

Hence, the fear of property loss resulting from execution doesn't mean that UMSC would suffer harm that can't be adequately compensated.

"I also agree with respondent Kyabahwa's submission that when the judgment creditor seeks the enforcement of a purely monetary claim, there is no exceptional quality attached to such a claim," Gashirabake added.

He concluded that he found no evidence of harm, damage, or irreparable loss being sustained and noted that the appeal had little chance of success.

"I concur with the respondent's counsel that the proposed grounds of appeal are tangential to the central substantive question at hand: UMSC's obligation to legally pay Kyabahwa according to the parties' agreement," Gashirabake said.

UMSC is currently facing legal hurdles following a High Court decision to grant a warrant of attachment and sale for its prime properties, including its headquarters in Old Kampala and properties in Entebbe, Jinja, Mbale, and Nakasongola.

These legal issues stem from a land sale agreement concluded on June 24, 2020, between Kyabahwa and UMSC in Ssembabule.

The agreement involved land occupied by squatters, and both parties agreed to lawfully remove the squatters within 60 days.

However, just three days after signing the agreement, Kyabahwa and his representatives allegedly forcefully evicted the squatters, leading to a lawsuit against UMSC.

Three years later, Kyabahwa sued UMSC for over 18 billion Ugandan shillings, and the court ordered UMSC to make the payment.

UMSC filed an appeal, but the case is still pending in the Court of Appeal as of the latest update.

Subsequently, UMSC received an execution application seeking to attach and sell various properties, including the National Mosque in Old Kampala.

UMSC's application for a stay of execution was denied, prompting an appeal to the Court of Appeal.

The Uganda Muslim Lawyers Association (UMLAS) recently formed a dedicated five-member committee to gather information and assess the judgment regarding UMSC and its properties at risk of seizure.

The Mufti, Sheikh Ramadhan Mubaje, criticised the court's ruling, accusing it of favoring wealthier individuals. The court proceedings and subsequent events have sparked widespread debate.

The details from the sales agreement have brought UMSC and Sheikh Mubaje under scrutiny.

It has emerged that Mufti Sheikh Ramadhan Mubajje and former Supreme Council Chairperson Dr. Abdul Kadir Balonde signed a sale agreement for a two-square-mile land in Sembabule district with Justus Kyahabwa, mediated by Arthur Kayanja, on June 24, 2020.

Kyahabwa paid sh3.5 billion shillings for the land, which had some encumbrances.

Questions have arisen as to why UMSC didn't seek legal advice when drafting the controversial sales agreement.

There's also concern regarding why both the buyer and seller insisted on keeping the agreement confidential.

There has been no explanation as to why UMSC would sell the land to Kyahabwa when it had already been sold to M/s Enterprise Handling Services Limited, as indicated by court documents.

The current saga surrounding the sale of UMSC properties brings back memories of 2008 when the Mufti and members of his executive Mubaje were accused of illegally selling land and buildings in Kampala.

This disagreement led to the formation of a breakaway faction, headed by Supreme Mufti Sheikh Shaban Muhammad Galabuzi and headquartered at Kibuli Mosque.

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