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KCB Bank Uganda Limited v Development Associates Link International Limited and Another (Civil Suit No. 0447 of 2025)

High Court · [2025] UGCOMMC 422 · 2025 Judgment for Plaintiff AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
First instance civil suit for recovery of outstanding loan balance
Decision
Defendants held jointly and severally liable for outstanding loan sum, interest, and costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The High Court Commercial Division held that the 1st Defendant breached its loan agreement by failing to repay UGX 60,000,000 advanced in August 2022, which was due by 12th November 2022. The 2nd Defendant, having executed a personal guarantee, was held jointly and severally liable with the 1st Defendant for the outstanding balance of UGX 50,254,526. The court awarded the plaintiff the outstanding sum plus interest at 23% per annum from the date of filing until full payment, applying the principle that a guarantor's liability crystallises upon the principal debtor's default.

Outcome

Defendants held jointly and severally liable for outstanding loan sum, interest, and costs

Facts

In August 2022, KCB Bank Uganda Limited advanced UGX 60,000,000 to Development Associates Link International Limited at 23% per annum interest, repayable in a single instalment by 12th November 2022. Henry Clarke Kisemeo executed a personal guarantee dated 11th August 2022 to secure the facility. The 1st Defendant defaulted on the repayment date. On 11th February 2023, the 1st Defendant paid UGX 202,684 towards interest. On 22nd June 2023, a partial payment of UGX 31,938,029 was made, applied to principal, normal interest, and penalty interest. Despite these payments, an outstanding balance of UGX 50,254,526 remained. The bank issued demand notices to both defendants, but neither regularised the account. The defendants were served with summons but filed no defence.

Issues

  1. Whether the 1st Defendant breached the loan agreement
  2. Whether the 2nd Defendant is liable under the Personal Guarantee
  3. What remedies are available to the parties?

Orders

  • Judgment entered in favour of the Plaintiff against the Defendants jointly and severally.
  • Payment of the outstanding loan sum of UGX 50,254,526.
  • Interest of 23% per annum on the outstanding sum from the date of filing the suit until payment in full.
  • Costs of the suit awarded to the Plaintiff.

Rules and key headnotes

Contract Law — Breach of Contract — Failure to Perform Contractual Obligations
Once a valid contract is formed, it creates reciprocal rights and obligations between the parties, and when a document containing contractual terms is signed, in the absence of fraud or misrepresentation, the party signing it is bound by its terms.
Banking & Finance — Loan Recovery — Burden of Proof in Debt Claims
Where a creditor introduces evidence of a debt establishing a prima facie case, the burden of going forward with the evidence shifts to the debtor, who is then under a duty of producing evidence to show payment.
Contract Law — Guarantee and Indemnity — Liability of Guarantor
Under Section 70 of the Contracts Act Cap 284, the liability of a guarantor is coextensive with that of the principal debtor unless otherwise provided by contract, and takes effect upon default by the principal debtor.

Legislation cited (3)

Cases cited (3)

  • William Kasozi v DFCU Bank Ltd (Civil Suit No. 1326 of 2000)
  • Nakana Trading Co. Ltd v Coffee Marketing Board (Civil Suit No. 137 of 1991)
  • Spring Freight Logistics Limited v Amoo Holdings International (Civil Suit No. 0556 of 2019)

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

KCB Bank Uganda Limited v Development Associates Link International Limited and Another (Civil Suit No. 0447 of 2025) [2025] UGCommC 422 (31 October 2025)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.