In the ruling delivered via Email, Justice Stephen Mubiru also directed the association to hand over a ground-floor commercial unit to businesswoman Sarah Nabuuma after finding that the association breached binding resolutions and fiduciary duties.
Court also directed New Park Lockup Owners Association to pay a total of Shs1.256 billion to Nabuuma and Hussein Kakooza in damages, plus interest and legal costs.
The dispute arose from the redevelopment of lock-up shops around the former New Taxi Park after Kampala Capital City Authority directed tenants to form an association to manage the project and acquire a lease.
Court records show that Kakooza and Nabuuma were original lock-up owners, known as pioneer members, who contributed funds for the construction of a new commercial complex.
Under a 2010 resolution, they were promised ground-floor shops upon completion if they met their financial obligations.
However, the two told court that despite paying the required Shs88.5 million each, they were allocated smaller units on upper floors while the association opened the project to new buyers.
The association denied wrongdoing, arguing that allocation followed a “first pay, first allocate” system. But Justice Mubiru ruled that resolutions passed at members’ meetings are binding and enforceable.
He found that the association continued accepting late payments and therefore could not rely on missed deadlines to deny pioneer members their rights.
The judge also held that the association’s leaders had a duty to act in the interests of members after collecting their money, and that opening ground-floor units to outsiders breached both contractual and fiduciary obligations.
However, the court dismissed allegations of fraud, saying the claimants did not provide sufficient evidence.
As part of the ruling, Nabuuma was awarded a ground-floor unit, shop No. 763, along with Shs283.5 million in general damages for lost rental income since 2017.
Kakooza, whose unit could not be allocated, was awarded Shs957.55 million in compensation, as well as Shs15 million in general damages.
The court also ordered that interest be paid at eight percent per year until full payment is made.
The case was filed in 2017 and has taken nearly nine years to be concluded.
Report by: Betty Zziwa
