Court clears Equity Bank to recover UGX 1.3b from Ratidu Trading in precedent-setting ruling

April 23, 2026 in Business, Companies, Financial Services by Editor

The High Court has allowed Equity Bank to proceed with recovery of more than UGX1.3 billion from Ratidu Trading Ltd after dismissing an application to halt execution, in a ruling legal analysts say reinforces stricter standards for stay of execution applications in commercial disputes.

 

The High Court has cleared Equity Bank to proceed with the recovery of more than UGX1.3 billion from Ratidu Trading Ltd, delivering a ruling that could shape how future commercial disputes involving stay of execution applications are handled.

Justice Susan Odongo dismissed an application by Ratidu Trading and its director, Titi Kayondo Kabi, who had sought to stop enforcement of earlier court orders while they pursued an appeal.

The ruling gives Equity Bank the green light to continue execution proceedings and strengthens the principle that parties seeking to delay enforcement of judgments must meet strict legal thresholds, particularly in debt recovery disputes.

The case stems from a loan facility extended by Equity Bank to Ratidu Trading Ltd, which later defaulted, prompting the bank in 2023 to move to recover more than UGX1.3 billion.

Ratidu Trading contested the claim, maintaining that it was not indebted to the bank and arguing that it had already paid over UGX700 million toward the facility.

However, the company failed to produce documentary evidence to support that position, leading the court to rule in favour of the bank.

Following that decision, Ratidu Trading sought a review of the judgment, asking the court to set it aside on grounds that its previous lawyers had been negligent and had failed to attach proof of payment.

The company argued that the omission by its earlier legal team had unfairly prejudiced its case and denied it a fair hearing.

But that application was dismissed on August 25, 2025, with the court finding no sufficient basis to reopen the matter.

Still dissatisfied, Ratidu Trading filed a notice of appeal to the Court of Appeal and returned to the High Court seeking a stay of execution to prevent Equity Bank from enforcing the judgment before the appeal could be heard.

In their application, the company and its director warned that immediate execution would cause serious financial damage, including the collapse of the business and the forced sale of valuable properties.

They argued that Equity Bank had already initiated recovery proceedings and that unless execution was halted, they would suffer substantial and irreversible loss.

They further submitted that their intended appeal had strong chances of success and expressed willingness to provide security as required under the law.

Ratidu’s legal team, led by Joseph Katushabe of Grit Advocates, argued that the matter raised significant legal questions, including the right to be heard and alleged procedural irregularities during the earlier proceedings.

“The intended appeal raises serious and triable issues,” the lawyers submitted, insisting that the court should preserve the status quo until the appellate process was concluded.

Equity Bank, however, strongly opposed the application and argued that Ratidu’s request had no legal foundation.

Through its lawyers led by Arnold Kimara of Kimara Advocates and Consultants, the bank maintained that the application was defective and that the company was attempting to delay lawful recovery.

The bank argued that the order Ratidu sought to stay was what the law describes as a “negative order,” meaning it did not require any positive enforcement and therefore could not be stayed in the first place.

It also challenged the validity of the intended appeal itself, saying Ratidu had failed to obtain the necessary leave to appeal and had therefore not established a competent appellate process.

“There is no valid or competent appellate process,” the bank submitted, further describing the notice of appeal as incompetent.

Justice Odongo agreed with the bank’s position and dismissed the application, effectively allowing execution to proceed.

Legal observers say the ruling is significant because it reaffirms that courts will not easily grant stay of execution orders simply because a losing party has filed or intends to file an appeal.

Applicants must demonstrate actual substantial loss, a valid appeal process and compliance with procedural requirements—not just fears of business disruption.

The judgment also highlights the risks businesses face when they fail to properly document loan repayments or rely too heavily on post-judgment arguments based on counsel negligence.

For lenders, especially commercial banks managing non-performing loans, the decision strengthens confidence in judicial enforcement mechanisms and may reduce delays in recovering defaulted facilities.

For borrowers, it sends a strong warning that courts expect prompt and well-documented defence of claims rather than repeated attempts to reopen concluded matters.

The case comes at a time when financial institutions are tightening credit risk controls amid rising defaults in the business sector, particularly among trading firms facing liquidity constraints and high borrowing costs.

As commercial litigation involving loan recovery continues to rise, the Ratidu-Equity Bank dispute may stand out as an important judicial marker on where the balance lies between protecting borrowers’ rights and ensuring creditors can enforce legitimate claims without endless procedural delays.