By THE OBSERVER UG
For residents of Rubaga division in Kampala, Lungujja Progressive School holds a revered status as one of their premier educational institutions.
The sight of its iconic, white-storied building and serene surroundings along Makamba road in Ssendawula Zone evokes memories. However, passersby, old students, and parents can’t help but pause in disbelief at the sight of its largest portion being demolished, bringing down efforts of close to 30 years.
Founded by Sarah Nabuuma Nyanzi, the school commenced its journey with two pupils in a modest boys’ quarter of her Lungujja residence in 1995. With determination, Nyanzi painstakingly built the school brick by brick. Before the onset of the COVID-19 pandemic, the school had experienced remarkable organic growth, with enrollment soaring to over 500 students.
Positioned on a generous expanse of land, the school showcased distinctive structures, dormitories, expansive play areas, teacher lodgings, and a dedicated daycare facility. Eria Mutumba, Nabuuma’s son, tearfully recounts the tragic downfall of their family’s legacy as his mother falls victim to a loan-property scandal while endeavoring to expand the school and establish a new campus, akin to other successful educational institutions.
“In just a blink of an eye, my mother lost everything she had tirelessly built over a lifetime,” lamented Mutumba during an interview with our reporter.
He attributed the devastation to collusion between unscrupulous individuals in a commercial bank and another man. As an administrator at the school, Mutumba recalled his mother’s aspirations in 2017 to create a new campus. Initially, she rented a building near the Bahai Temple in Kikaaya but found it cramped and inadequate.
Driven by a vision of providing a more spacious and conducive environment for learning, she sought to secure a larger premise for the new school. Now viewed as the mistake of a lifetime, Nabuuma confided her aspirations to Vincent Kizito, a church friend whom she had met at Pastor Ssekyewa’s church, where they both attended prayers.
“That man started showing keen interest, and I believe he had already identified his target,” Mutumba reveals. “He continued to visit us until he suggested that he owned a property (K.V Plaza) along Entebbe road in Zzana that could accommodate a school.”
He further noted that, in pursuit of his business interests, the gentleman convinced the school proprietor that she could obtain a loan from a bank. Subsequently, he discreetly introduced her to the Bank of Africa at Nakivubo, suggesting they could provide the necessary financing for the purchase of the property, with the promise of repayment at a later date.
According to available documents, Bank of Africa agreed to assist the school director in acquiring the property and executed a credit facility agreement with the bank totaling Shs 850 million. However, it was explicitly stated in the terms of the agreement and the letter of undertaking that this money was not to be disbursed to Kizito until the ownership papers were presented.
Despite these agreed-upon terms, an affidavit sworn by Nabuuma and attached bank statements reveal that the bank disbursed the funds to Kizito on February 26, 2018, before compliance with the agreed-upon conditions.
“I kept asking/inquiring from the first defendant (Bank of Africa) for the progress of the title for the land at Kirimanya LCI, but the 1st defendant did not give any satisfactory progress report, yet they were deducting the loan installments from the school account,” she stated.
In the loan agreement, the school was to operate 80 percent of its account from this very bank. Mutumba added that before his mother grew suspicious of the situation, the bank extended another loan to her amounting to Shs 400 million. This additional loan was intended for the purchase of an adjacent property, which would provide the school with a larger compound.
As a result, the total loan amount escalated to Shs 1.2 billion, with a repayment period of 10 years. According to the agreement, repayment was to be made once per school term. Nabuuma pledged the newly purchased property as security, along with two land titles of her school in Lungujja.
COVID-19 and demolition of the school
Amidst the initial smooth progress, with only a few concerns raised by Nabuuma regarding the bank’s failure to provide title deeds for the property in Zzana, the emergence of the COVID-19 pandemic disrupted everything. The unprecedented closure of schools meant that the institution could no longer collect fees to deposit in the bank.
Mutumba further adds that at one juncture, Nabuuma appealed to the bank to provide her with the title deed of the property in Zzana so she could sell it and access the funds. However, she was informed by the bank that they did not possess any such document.
“Despite the circumstances, the bank insisted that my mother had to continue paying the installments,” Mutumba recalled.
“Before long, they proceeded to advertise the school property in Lungujja for sale, alleging that we had defaulted on the payments.”
Nabuuma only retained the land that housed the daycare center, and it is here that the family is attempting to construct some structures to continue teaching. Additional documentation confirms that the school property was indeed sold to Dr. Mahmoud El-Gazzar and Dr. Shaarwy Amal Ahmed Mohamed, and the title was transferred despite the existing caveat on the property.
According to a police report filed by AIP Arnold Muhwezi, the division scene of crime officer at Old Kampala police in July 2023, the school was seized by the bank, using Anka Security. Subsequently, several buildings, including dormitories and teacher quarters, were demolished.
Following a report from Nabuuma’s son, the police initiated investigations into the matter. A report on the case, prepared by Herbert Akankwasa, the divisional CID officer of Old Kampala Police Division, shows that their efforts were thwarted by the lack of cooperation from Bank of Africa.
“Despite the fact that an affidavit was sworn, and a court order obtained to inspect the bank account of Kizito Vincent at Bank of Africa, the bank officials tactically and stubbornly refused to release bank statements to the police officer,” the report reads in part.
However, as the police’s efforts faltered, the victim complained to the resident state attorney at Mwaga II court, and the file was forwarded there. The state attorney later advised that further investigation was warranted but noted that there was sufficient evidence indicating collusion between the bank officials and Kizito.
“The resident attorney found out that the assembled evidence was clear evidence that the Bank of Africa assured Kirabo Sarah (Nabuuma) that they had a title in respect to Kizito Vincent’s land and they went ahead to process a which which they immediately paid money to the said Kizito’s account and later turned out that the bank had no title,” Akankwasa’s report adds in part.
The state attorney also directed that the police record statements from the bank officials who were involved in the matter. However, despite these instructions, the officials refused to provide statements and relevant documentation. In response, the resident state attorney directed that the bank officials be charged alongside Kizito.
However, before the police could implement these orders, the file was summoned by the regional office of the Director of Public Prosecutions (DPP), who subsequently instructed the police to close the file due to a lack of sufficient evidence. In concluding his report on the matter, Akankwasa highlighted the three suspicions of collusion between the bank officials and Kizito: “it would be prudent enough for the bank to interest itself in the mortgaged property at Zzana other than the school at Lungujja if there was no connivance between the bank (officials) and Kizito Vincent.”
Findings
Following the closure of the case by the police, Nabuuma enlisted the services of lawyers to pursue the matter further. Humphrey Tumwesigye, one of the lawyers hired by Nabuuma, remarked that upon reviewing the documents, he discovered that something seemed suspicious from the outset.
He noted that the bank had offered to assist Nabuuma with legal matters, including the processing of the title for the property in Zzana.
“They disenfranchised her by ensuring that she never obtained or consulted a lawyer,” he stated before advising that individuals involved in such business transactions should always seek legal advice to mitigate the risks of being defrauded.
The lawyer added that during the fact-finding process before filing a lawsuit, they uncovered documents from different sources, including Bank of Uganda, which surprised them.
“There are documents that show that the bank advanced a loan of Shs 480 million instead of Shs 800 million for the first loan. On the second loan, which my client thought to be Shs 400 million, there are other documents showing that Kizito was paid Shs 280 million for this, and the money was signed by his son,” he explained.
Kizito and bank’s defense
In his defense filed in the matter before the court, Kizito challenges Nabuuma’s account of the situation, offering a different perspective on the matter. He contends that he provided the plaintiff with a certificate of title from the Buganda Land Board, along with a land sale agreement for the property at Kirimanyaga, which documents he handed over to the bank.
He further added that for the second plot, he was not the owner. In the presence of Nabuuma, he agreed with a person named Paul Nviiri, indicating that he had purchased Nviiri’s Bibanja. Nviiri was to be paid after the plaintiff secured the loan.
“But both the 2nd defendant and the plaintiff knew it among themselves that that agreement was only for the purpose of acting as security to enable the plaintiff to get a loan from the 1st defendant and later the plaintiff pays for the Bibanja,” the defense filed by Align Associated Advocates on behalf of Kizito reads in part.
He also added that when Nabuuma received the second loan for the additional Bibanja, she changed her mind about paying Nviiri for the Bibanja, opting instead to divert the funds for other purposes. Subsequently, Nviiri reportedly repossessed the property after Nabuuma failed to fulfill the payment agreement.
Similarly, the Bank of Africa’s defense largely revolves around how the loan and its utilization were applied for and approved. In their defense, the bank emphasized that before selling off the property, they repeatedly urged Nabuuma to rectify her loan defaults on her credit facility obligations, which she failed to do despite numerous requests.
The bank also states that after the sale of the property in Lunguja, they were only able to recover Shs 1.13 billion from the proceeds, leaving an outstanding loan balance of Shs 1.14 billion that remains unpaid. Furthermore, the bank asserts that Nabuuma had provided land agreements between herself and Kizito for the loan, and it was her responsibility, not the bank’s, to conduct due diligence.
“The 1st defendant (the bank) denies the contents of paragraph 6 of the plain and the plaintiff shall be put to strict proof of the contents therein. The 1st defendant shall avert and contend that the 2nd defendant (Kizito) was never known to them and presenting a land title was never a condition of the facility disbursement letter on paying the 2nd defendant for the land bought by the plaintiff,” the bank’s defense statement reads in part.
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