According to court documents, Mr. Barugahara was approached by Mr. Muwanga in July 2021 seeking financial support amounting to Shs 1.4 billion. Mr. Barugahara agreed to provide the funds, advancing Shs 1 billion to Mr. Muwanga’s account in DFCU Bank on July 29, while an additional Shs 400 million was given in cash. An agreement was entered into stipulating the repayment terms.
The Commercial Court has ruled in favour of Youth and Children Affairs Minister Balaam Barugahara in a case against Haruna Muwanga, the son of the late BMK, ordering him to pay Shs 1.4 billion that he borrowed but failed to repay.
Balaam Barugahara
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"In the contract, it was agreed that Mr. Muwanga shall return the money in six months from the date of signing the agreement, with Shs 1 billion to be returned by October 30, 2021, and Shs 1.3 billion by January 30, 2022," the court documents revealed.
To assure Mr. Barugahara of his commitment, Mr. Muwanga indicated that he was a director at BMK and arranged for standing orders to be set up through DFCU Bank in favour of Mr. Barugahara. Additionally, Mr. Muwanga provided cheques to be banked only if the standing orders failed.
However, Mr. Muwanga later requested Mr. Barugahara not to deposit the cheques, promising instead to repay the amount in cash. He managed to repay Shs 400 million, leaving a balance of Shs 1 billion outstanding.
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The court documents further disclosed that on January 11, 2022, Mr. Muwanga requested additional financial support of Shs 400 million. An addendum to the original contract was made, agreeing that Shs 1 billion would be returned by March 11, 2022, and Shs 1.3 billion by July 11, 2022. Despite these agreements, Mr. Muwanga failed to repay the money, leading Mr. Barugahara to make several attempts to meet with him, all of which were unsuccessful.
Taking legal action
Due to the failure to recover his funds, Mr. Barugahara filed a lawsuit on January 18, 2024, seeking the recovery of the money owed. The court, presided over by Justice Thomas Ocaya, found in favour of Mr. Barugahara. Justice Ocaya noted that Mr. Barugahara would not have brought the matter to court had Mr. Muwanga fulfilled his contractual obligations and adhered to the repayment schedule.
"In this case, Mr. Barugahara would not have brought this matter to court had Mr. Muwanga performed his contractual obligations or adhered to demands for payment thereafter. As such, I award Mr. Barugahara the costs of the suit," ruled Justice Ocaya. The court also awarded Mr. Barugahara an interest rate of 6% per annum on the outstanding contractual amount from the date of default until the filing of the lawsuit.
