Kampala, Uganda – The High Court of Uganda has ruled that the sale of Simbamanyo Estates’ prime properties, Simbamanyo House and Afrique Suites Hotel, was lawful, dismissing claims of fraud and illegality raised by the late Peter Kamya’s estate. The July 25, 2025, judgment by Justice Harriet Grace Magala affirmed Equity Bank Uganda, Equity Bank Kenya, and Bank One Limited’s actions in recovering a $10 million loan, marking a significant conclusion to a protracted legal battle. The dispute originated in 2012 when Simbamanyo Estates, formerly owned by city architect Peter Kamya, secured a $6 million syndicated loan from Equity Bank Uganda and Equity Bank Kenya to finance the construction of Afrique Suites Hotel in Mutungo and clear a prior loan from Shelter Afrique. In 2017, a $10 million bridge loan was facilitated through a standby letter of credit issued by Equity Bank Kenya and Bank One Limited. When Simbamanyo defaulted, Equity Bank Kenya triggered the letter, activating a post-import finance loan with Equity Bank Uganda. Simbamanyo Estates contested the arrangement, alleging that Equity Bank Uganda was not the designated lender and that no utilization request was submitted. They further claimed the loan violated the Financial Institutions Act. Justice Magala rejected these arguments, stating that the utilization request was optional and the syndicated loan was a commercial necessity to avoid exceeding Equity Bank Uganda’s credit exposure limits. She clarified that foreign bank lending does not constitute illegal banking in Uganda unless sourced from public deposits. The court found no evidence of fraud, undue influence, or misrepresentation in the sale of Simbamanyo House on Lumumba Avenue, sold to Meera Investments Limited for $5 million, and Afrique Suites, acquired by Luwaluwa Investments for $4.3 million in October 2020. Justice Magala emphasized that the standby letter of credit was a separate security agreement, obligating payment upon default without prior borrower notice. Simbamanyo’s claim of inadequate notification was also dismissed, as they were aware of their obligations. The ruling follows years of legal challenges by Kamya, who sought to halt the sales, alleging collusion between Equity Bank and buyers. Previous court decisions, including a 2022 Commercial Court ruling by Justice Stephen Mubiru, denied injunctions to stop the property transfers, citing the properties’ transfer to Meera and Luwaluwa Investments. Kamya’s appeals, including a 2021 case dismissed by Justice Susan Abinyo, consistently failed, with courts ordering Simbamanyo to pay significant legal costs, including Shs1.3 billion in 2021. The case drew public attention, with Kamya petitioning President Museveni in 2021, alleging illegal sales during the COVID-19 foreclosure moratorium. However, a Bank of Uganda investigation, ordered by Museveni, upheld the sale’s legality, noting Kamya’s default since 2016. This ruling reinforces the enforceability of loan agreements and property foreclosures in Uganda’s financial sector, with costs awarded to the defendants. The decision closes a chapter in the high-profile dispute, affirming the legal transfer of Simbamanyo’s assets to new owners.The post High Court Upholds Lawful Sale of Simbamanyo Properties in $10M Equity Bank Dispute appeared first on Watchdog Uganda.