The High Court’s Commercial Division ordered DFCU Bank and the Commissioner for Land Registration to pay Shs810 million in damages to 27 individuals for illegally withholding land titles they had lawfully purchased.
Presiding Judge Suzan Abinyo ruled that both DFCU Bank and the Commissioner were wrongfully in possession of land titles for 8.96 acres located in Lugala Nakwero, Wakiso District—despite a prior agreement that required their return to Hosanna Real Estates Limited.
In 2011, Hosanna Real Estates Limited secured a loan of Shs2.5 billion from Global Trust Bank (GTB), using 43.22 acres of land as collateral. After failing to repay the loan—which had grown to Shs3.153 billion—GTB sued Hosanna in 2013 to recover the funds.
The dispute was resolved through a consent judgment, in which Hosanna agreed to cede 34.26 acres to GTB while retaining 8.96 acres. However, before the title for the 8.96 acres could be returned, GTB was liquidated by the Bank of Uganda.
Despite this, Hosanna had already subdivided and sold the 8.96 acres to 27 buyers. When DFCU Bank took over some of GTB’s assets following its closure, it refused to release the titles to the new owners, prompting the lawsuit.
DFCU argued that it had no direct dealings with the plaintiffs and had only assumed management of selected GTB assets under the directive of the Bank of Uganda. It further claimed that the disputed land was not part of the assets it had acquired.
However, the court dismissed this defense. Judge Abinyo ruled that DFCU, as a successor in title to GTB, inherited both its assets and liabilities, and the 8.96 acres were not among the assets under liquidation at the time.
“This Court finds that DFCU, as the successor in title, took over the assets and liabilities of GTB in liquidation. The claim that DFCU was merely contracted to manage certain assets cannot stand in the absence of contrary evidence,” the judge ruled.
The Commissioner for Land Registration was also held liable for failing to effect the transfer of the land titles to the rightful owners, even after the land had been subdivided and sold.
“In the given circumstances, I find no reason to deny the plaintiffs costs, which follow the event as required under Section 27(2) of the Civil Procedure Act,” she added.
Each of the 27 plaintiffs was awarded Shs30 million in damages, totaling Shs810 million, with an annual interest rate of 8%. The judge also directed the Registrar of Titles to immediately transfer the land titles into the names of the plaintiffs.
