By Our Reporter
MBALE
Mbale tycoon and hotelier owning Wash&Wills in Malukhu is in real trouble after the Commercial Court indicted him together with Diamond Trust Bank and an MP for defrauding General Charles Angina.
In a court ruling delivered by Justice David Wangutsi on Friday 5th March 2021, Joseph Ariong Odea, Diamond Trust Bank [DTB] and Bukedea MP Patrick Isiagi Opolot were found guilty of defrauding General Angina of his Muyenga residential property.
Delivering the ruling, Justice Wangutsi specifically indicted Ariong and DTB of engaging in acts that deprived General Angina of his property and profiting from the same said fraudulent acts.
However, Hon. Isiagi Opolot even after being found to have acted fraudulently in later transactions as Third Party, came off without being penalized.
In a 26 page judgment, Justice David Wangutsi has ordered Ariong to pay general damages of Shs100M to Angina and another Shs100M as exemplary costs. In total Ariong now has to pay the General Shs200M on top of reverting back the ownership of the Muyenga property to Angina.
“Taking into account the activities of both, I would award the plaintiff (Gen. Angina) general damages of 300 million; apportioning the liability as follows: 1st Defendant (DTB) 2/3 and 2nd Defendant (Ariong) 1/3,” the Judge ruled.
DTB meanwhile was ordered to pay Shs200M as general damages on top of Shs100M as Exemplary damages because it fatally breached provisions of both the Mortgage Act and the Financial Institutions Act (FIA).
“The conduct of the 1st Defendant, (DTB) raises a lot of questions as to how safe their customers’ money and property is,” the Judge said in his ruling.
Background
Briefly here is what happened: Ariong (acting as a good concerned friend) reaches out to Angina interesting him in buying a property that was available on sale in Lukuli Makindye Division. The owner is Amina Mariam Kizito who is troubled with a debt from Grofin Uganda Ltd who are holding onto her title as security.
The year is 2012. Angina appreciates the deal but tells Ariong he likes the property but he is financially constrained. Ariong, already a long term customer with an excellent relationship with DTB, suggests some way forward. He offers to introduce and connect Angina to DTB to obtain a loan facility with which the Lukuli property can be acquired. He also offers to sign onto the mortgage documents as the guarantor of the loan just in case Angina defaults.
Renowned for his incorruptibility, Angina (a former Deputy CDF) reluctantly agrees and gets advanced Shs210m which he uses to acquire the property from Ms Kizito. The DTB directly transfers money from Angina’s newly opened account to free up Ms Kizito.
Angina proceeds making monthly instalments to service the loan. But because he is a big man in government, being Deputy CDF, he fears any leakages to the tabloid media and prefers to keep in the background. That is how he ends up making his monthly repayments through Ariong without himself dealing with the bank directly.
After sometime, Ariong presents a new offer. Ms Kizito is selling another residential property in Muyenga near Kabalagala. Shs380m is required to seal off the deal. Ariong offers to help Angina obtain another loan facility from DTB using the Lukuli land as security. The bank agrees and the deal is concluded. Angina becomes owner of the Muyenga land as he continues servicing the DTB loan still through his guarantor Ariong. And still because he prefers to conceal his identity, Ariong continues being his points’ man in all matters relating to DTB and the subsequent transfers of the land from Ms Kizito to him.
After sometime, Ariong, taking advantage of Angina’s busy schedule and unwillingness to get conspicuously involved, connives with some DTB officials to become the owner of the Muyenga land claiming that the man or borrower whom he guaranteed had become obstinate and defaulted to continue paying the remaining balances. He purports to pay up the remaining balances allegedly using cash from the company under which he operates his Mbale-based Wish & Wills hotel business.
Well knowing all this is potentially fraud and untrue, as Angina isn’t notified about the consequences of his alleged defaulting, the bank acquiesces to Ariong’s claims and what is supposed to be Angina’s land is transferred to his name. And within a short time, Ariong purports to have effected another sale and transfer of the land in favor of Bukedea MP Patrick Isiagi Opolot who becomes new owner. Ironically, the same Ariong uses his connections in DTB to get the bank fund Isiagi’s purported purchase of the land from him. As all this is happening, Angina (who is only interacting with DTB through Ariong) is kept in the dark.
On realizing all this fraud, Angina brings up a suit against the bank, Ariong and Isiagi demanding damages and repossession of the land which court eventually establishes legally remains his notwithstanding the multiple fraudulent transfers the trio has been occasioning behind his back. As soon as Angina files his suit (in February 2018) and brings it to the attention of the defendants’ trio requiring them to file their defense, Ariong purports to enter a swap deal with Isiagi.
The two claim that Ariong, who for unknown reason is supposed to have sold the same to Isiagi, claims he has developed appetite to get back his Muyenga land. He purports to own some land in Malembo in Masaka district which he claims to swap with Isiagi who, curiously, acquired the Muyenga land using a loan that was processed and availed to him by the same DTB. Nine days after Angina serving the trio notifying them about his suit against them, Isiagi purports to have sold back the Muyenga land to him and even has transfer papers which he subsequently attempts to make part of his defense evidence at the subsequent court proceedings before Justice Wangutsi.
In his ruling, the very prudent Justice Wangutsi finds that much as Isiagi might have been an innocent purchaser of value without notice of the anti-Angina fraud DTB and Ariong had indulged in, his attempt to surrender the land back to Angina (the plaintiff) without him providing any consideration came off as fraudulent. In the end, the judge directs that the land which DTB received from Sebalu Lule Advocates, who were acting on behalf of Grofin Uganda Ltd, must be immediately be surrendered back to Angina as the lawful owner. The Commissioner Land Registration is directed to cancel all the preceding transfers involving Ariong and Isiagi for being fraudulent, sham, null and void.
