KAMPALA, Uganda — The Court of Appeal has directed Muwema & Co Advocates to provide security of $100,000 (about Shs370 million) as a condition for maintaining a temporary halt on enforcement of a monetary decree arising from a dispute over a property in Kololo.
The order was issued by Justice John Mike Musisi in proceedings involving the law firm and Downtown Investments Ltd over premises at Plot 50, Windsor Crescent.
The court has suspended further enforcement of the financial portion of a High Court decision pending the determination of the law firm’s intended appeal.
The suspended enforcement includes proceedings relating to rent arrears, mesne profits, general damages, interest and costs.
Muwema & Co has one month to either deposit the required amount in court or provide an unconditional bank guarantee from a reputable commercial bank.
Should the firm fail to meet the condition within the stipulated period, the stay will automatically lapse.
Dispute over purchase option
The case stems from a disagreement over a clause in a 2014 lease agreement that gave Muwema & Co a first option to purchase the property.
The parties later disagreed over whether a $1.05 million offer made by the law firm in August 2021 constituted a valid exercise of that option.
Muwema & Co maintains that its actions amounted to an exercise of the contractual right, while Downtown Investments disputes that position.
In February 2026, the High Court Commercial Division ruled that the parties had not concluded a binding sale agreement and found that rent continued to accrue.
The High Court subsequently awarded Downtown Investments $148,300 in rent arrears, $224,000 in mesne profits and Shs50 million in general damages, together with interest and costs.
Muwema & Co challenged the decision before the Court of Appeal and sought to stop further execution of the decree while its appeal is considered.
Court identifies arguable issues
In granting the conditional stay, Justice Musisi found that the intended appeal raised issues that warranted consideration by the appellate court.
Among the questions to be examined are the interpretation of the purchase-option clause, payments made after the 2021 offer and the basis upon which mesne profits were awarded.
The judge, however, declined to reverse the eviction of the law firm from the property.
The court noted that Downtown Investments had already regained possession of the premises and that a stay could not restore a position that had already changed.
Any challenge concerning the legality of the repossession, the court said, would have to be pursued through the appropriate proceedings.
Protection against further enforcement
The court also considered the potential consequences of continued execution of the High Court decree.
Muwema & Co had raised concerns about possible attachment of properties belonging to its partners and garnishee proceedings against the firm’s bank accounts.
Justice Musisi found that enforcement measures affecting individuals who were not judgment debtors, as well as restrictions on the firm’s operating accounts, could result in harm that might be difficult to reverse later.
The court therefore halted attachment, garnishee and taxation proceedings arising from the monetary decree, subject to the $100,000 security.
The law firm had argued that security was unnecessary because Downtown Investments had already recovered possession of the premises.
The Court of Appeal rejected that argument, holding that security was appropriate as a condition for the stay.
It also declined Downtown Investments’ request for security covering the entire monetary decree and instead fixed the amount at $100,000.
Next stage
The substantive appeal will now determine whether Muwema & Co validly exercised its contractual right to purchase the Kololo property and whether the financial awards made by the High Court should remain in force.
Until then, the Court of Appeal’s latest order provides temporary protection against further execution while requiring the law firm to secure the stay.
The dispute, which began with a landlord-tenant relationship, has consequently shifted into a broader legal contest over contractual rights, property ownership and the financial consequences of the lease disagreement.