Standard Chartered Bank Dragged To Court By Over Shs6b Storage Charges

Liberty ICD Ltd, one of the largest Bonded Facility in Uganda has written to the Trial Judge in CIVIL suit No 41 of 2022 where the Respondents are Standard Chartered Bank (popularly known as StanChart) and Ligomarc Advocates, to expedite the case of recovering Shillings 6 billion for storage charges.

Last week, StanChart, announced that it was selling its entire Retail Business in Uganda, Botswana and Zambia.

In their request dated 29th November 2024 to the Judge, Liberty ICD stated that this issue of storage charges has been pending for 3 years, as StanChart has constantly implemented delaying tactics by diverting to others and not meeting their own obligations.

 In the recent court procedures, again, SCB requested to add Uganda Revenue Authority (UAR) and Threeways Group of Companies as parties to the case.

The Judge directed that the additional parties must make their submissions before December 18, 2024 for Liberty to allow them to respond. To date no communication has been received, as this appear to be another delaying tactic.

 It should also be noted that, SCB auctioned the Land of Threeways Group, in Namanve Industrial Park which was mortgaged to the Loan. As they could not meet their obligations, Liberty was wondering how Threeways would be in a possible to pay the storage charges.

This would impossible. Court documents indicate that Threeways Group has since cleared all its tax liabilities with URA. Consequently, the issue of URA's Warrant of Distress over the items (trucks and containers on Liberty ICD premises) is reportedly no longer applicable.

 As for URA, who issued those Warrant of Distress for assets of Threeways Group, Liberty ICD did not receive a direct communication, nor did URA actually take possession of these items. Furthermore, URA, by Law under Warrant of Distress, has a specific timeline that these goods had to be auctioned within 10 days.

This was never been implemented over the entire 3 years as these items are still on the ground. PRAYERS Liberty ICD has therefore requested in the letter to the Judge, that since its Business Operations have been seriously hampered for 3 years, that we request the Respondents, who are professional entities, to show an ethical commitment on resolving this issue.

 The items brought into the yard cover 2.5 Acres and included; Trucks, Trailers, Vehicles, Fuso, Generators, Excavator, Compressors, Water Tanks, Pipes, 40ft Containers having goods and 20ft Containers (12).

For these reasons our prayer is that the Judge can consider these facts and also schedule a LOCUS Visit to the Liberty ICD yard and see the impact of these items, and observe the disturbance to business operations. In addition, the Judge will notice that for 3 years many of these items have now depreciated in value, and it’s imperative they be removed from the yard.

 This petition has been copied to SCB head of legal Stella Keshubi, Associate Partner at Ligomarc Advocates Rita Birungi Mwesige, Threeways Shipping, URA's Manager of Debt Collection Stanley Kabyemera, and Mukono Division Police Commander. When contacted by this reporter Kabyemera (URA) confirmed receiving the petition but declined to comment on it.

In a Ruling dated July 3, 2024, the judge added StanChart as a respondent in the matter on account of it having contracted a law firm, Ligomarc Advocates, to effect placement of trucks and containers on the land of Liberty ICD for storage. Under Section 118 of the Contract Act, SCB employed Ligomarc for the recovery of monies from assets under mortgage. Section 119, 120 and 112 of the Contract Act, SCB expressively authorized to look for space.

Initially, it was only Ligomarc Advocates which was a party to the suit. Ligormac had also applied to court seeking to have the case dismissed on grounds that Liberty ICD had sued them illegally, because they are not a legal entity. However, the judge, ruled that they can also be a party along with SCB.

 The judge asked StanChart to explain why it should be exonerated from paying the accumulated storage charges of trucks and containers moved by Ligomarc, since it was the bank that contracted Ligomarc to store the items at Liberty ICD in also a binding contract.

The Judge also highlighted being aware of the agency principle raised by the Respondent claiming to have acted for and on behalf of Standard Chartered Bank (U) Ltd. According to Halsbury's Laws of England Volume 1 (2) the Judge given the merits of the case, hereby added to Civil Suit No. 41 of 2022, Standard Charted Bank as the 2nd Defendant.

 THE CASE

 Court heard that Ligomarc was appointed by StandChart to take over the recovery proceedings of the $7m (sh26b) loan that the bank issued to Threeways Shipping Group, but it defaulted. However, upon finding a buyer Mandela Group for this mortgaged property, demanded immediate vacant possession of the land. Ligomarc then, on behalf of the bank, approached Liberty ICD to hire storage space to accommodate trucks and containers that were on the mortgaged land on a short-term basis.

 All the terms and storage charges were approved by SCB. Therefore, under Sections 119, 120 and 122 of the Contract Act, there was a valid Contract in place between Liberty ICD, and SCB with Ligomarc acting as the Agent for the Bank. Immediately, these items were transferred on January 8th 2021 and within 5 days under supervision of Ligomarc who had hired a company and paid their fees from SCB.

There were so many items that Ligomarc had to even rent both 40ft and 20ft empty containers to store many items. At that time Liberty was not made aware of Threeways Group and the only interaction was with Ligomarc. As soon as the was vacant land on the next 2 days Mandela Group made full payment to SCB and took possession.

All this happened quickly within 7 days. Liberty has incurred much expenses to safeguard by hiring more askaris, cameras, dogs etc. for 3 years.

 Subsequently, an invoice was issued by Liberty ICD to that effect and Ligomarc communicated its approval through StanChart.

In accordance with the Contract that was agreed SCB paid Liberty ICD storage charges for 3 months. This payment by SCB for storge charges based on a Partial Consent Judgement on 14th September 2022 for UGX. 359,380,800/-.

 It should also be noted that from the onset Ligomarc kept possession of all the keys and Log Books, as though they have ownership. PRAYER Liberty ICD claimed that Ligomarc or StanChart have since defaulted on payment of remaining invoices for storage charges for almost 3 years (balance now being approximately Shillings 6 billion after 20% discount on the agreed storage charges according to the contract).

Liberty's prayer is that given the long period, enormous costs to safeguard these items, the Judge can take all these factors into consideration.