KAMPALA, Uganda — The High Court has granted Absa Bank Uganda permission to sell mortgaged property belonging to Boss Beverage Limited in a bid to recover more than Shs710 million in outstanding loan obligations.
The ruling follows a legal application by the bank seeking to enforce its security after the beverage company allegedly failed to meet repayment obligations under a loan facility secured by mortgage arrangements.
In its decision, the court found that Absa Bank had complied with the legal requirements governing mortgage enforcement, including the issuance of statutory notices to the borrower before commencing recovery proceedings.
Having satisfied itself that due process had been followed, the court authorized the lender to proceed with the sale of the mortgaged property to recover the outstanding debt.
The amount in dispute is reported to exceed Shs710 million, although the final recovery figure could rise further once legal fees, interest charges and other enforcement-related costs are taken into account.
The judgment represents another significant commercial dispute in which a financial institution has turned to the courts to recover funds from a borrower alleged to have defaulted on a secured loan facility.
Commercial law experts note that Ugandan courts have consistently upheld the rights of lenders to realize mortgaged assets where borrowers fail to meet their obligations and where statutory procedures have been properly observed.
“The courts generally seek to balance the rights of borrowers and lenders, but where a bank demonstrates compliance with the law and a clear default exists, enforcement of security is often upheld,” said a Kampala-based commercial lawyer familiar with mortgage recovery cases.
The ruling underscores the importance of secured lending arrangements in Uganda’s banking sector, where financial institutions rely on collateral to mitigate credit risk and protect depositors’ funds.
For businesses, the case serves as a reminder of the legal consequences of loan default, particularly where assets have been pledged as security for financing.
Neither Boss Beverage Limited nor Absa Bank Uganda had publicly commented on the ruling by press time.
The decision comes amid continued economic pressures affecting some businesses, with rising operating costs, liquidity challenges and changing market conditions contributing to repayment difficulties across various sectors of the economy.
With the court’s authorisation now secured, Absa Bank is expected to proceed with the process of disposing of the mortgaged property in accordance with the law to recover the outstanding debt.
