The High Court has dismissed an application by Dei Industries International and its proprietor, Dr Matthias Magoola, seeking to halt an ongoing independent audit process in their legal battle with Equity Bank Uganda Ltd and Equity Bank Kenya over a long-standing loan.
Justice Susan Abinyo said Dei Industries and Magoola had failed to prove that the ongoing independent audit process had been compromised.
The dispute traces its origins to August 2, 2024, when Dei Industries International Ltd, Dei Biopharma Ltd and Dr Magoola sued the two banks over several loan facilities and current accounts.
The companies argued that the banks had wrongly handled their loan accounts and asked the court to order a full reconciliation and accounting of all the loans.
They wanted the court to establish the actual amount, if any, that remained outstanding after several restructurings and consolidations of the facilities.
The companies also sought orders requiring the banks to credit back any money that had allegedly been unlawfully debited from their accounts.
They further wanted a permanent injunction stopping the banks from taking recovery or enforcement measures until the main case was heard and determined.
To help resolve the dispute, both sides initially agreed that KPMG should carry out a comprehensive audit of the loan arrangements.
The court adopted that agreement on December 10, 2024, and KPMG completed its work before filing its report on December 18, 2024.
However, the relationship between the parties deteriorated further.
Dei and Magoola returned to court and successfully sought to have the KPMG appointment set aside. They persuaded the court that the Institute of Certified Public Accountants of Uganda (ICPAU) should instead nominate an independent audit firm.
On March 31, 2025, the court revoked KPMG’s appointment and directed ICPAU to select another auditor. ICPAU later appointed Clayton & Company of Jinja to undertake the assignment.
The firm contacted both parties, issued terms of reference, collected documents and eventually submitted its audit report to court on June 28, 2025.
Before the report was filed, Dei Industries and Magoola launched yet another application, and this time, it claimed the independence and integrity of ICPAU itself had been compromised.
They asked the court to revoke ICPAU’s appointment altogether, stop the audit process and allow them to amend their original plaint.
Dei Industries was represented by senior lawyer Fred Muwema of Muwema & Co. Advocates while Equity Bank Uganda and Equity Bank Kenya were represented by Sim Katende of Katende, Ssempebwa & Co. Advocates.
Muwema argued that the replying affidavit filed on behalf of the banks was defective because it contained matters outside the personal knowledge of Equity Bank’s Head of Legal, Elizabeth Nayiga.
He maintained that she could not properly defend the competence or conduct of Clayton & Company because she neither belonged to ICPAU nor participated in the audit exercise.
Muwema argued that their application was not overtaken by events because the audit process had not been completed when they filed the case.
He also said that they should be allowed to amend their plaint to reflect new developments in the dispute.
Katende, Equity Bank’s lawyer, disagreed with Muwema, telling the court that the heart of the dispute was the amount of money, if any, owed under the various loan facilities.
He argued that only an independent audit could establish whether the banks had wrongly debited the applicants’ accounts, whether predatory lending had occurred and what sums remained outstanding.
He further argued Dei Industries and Magoola were attempting to change the nature of their original case by removing the need for an audit after they themselves had sought one.
Katende also submitted that ICPAU’s role had been purely administrative because it merely nominated an auditor in compliance with a court order.
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Justice Abinyo agreed with the banks on every major issue and rejected Dei International’s challenge to the replying Nayiga’s affidavit.
She said Nayiga, the head of legal at Equity Bank Uganda, was entitled to swear the affidavit because she relied on information obtained through her position and from documents available to her.
“As such, she cannot be said to have deposed on facts that were not within her knowledge because she did not participate in the audit exercise,” Justice Abinyo said.
She said ICPAU had already complied with the earlier court order by appointing Clayton & Company, noting that the audit firm had already requested documents, issued terms of reference and begun its work before the application was filed.
“The ICPAU was not required to consult with the parties on the nomination process, which would undermine the concept of independence,” Justice Abinyo said.
She said Dei Industries and Magoola had failed to table evidence supporting the allegation that ICPAU had compromised its independence.
“In the circumstances of this application, the burden of proof is on [Dei and Magoola] to adduce evidence to prove the said allegations… which was not done to the satisfaction of this court,” Justice Abinyo said.
Having rejected those claims, she also declined to revoke ICPAU’s appointment and dismissed Dei Industries’ request to amend the plaint, saying it would prejudice the banks because the applicants could instead present evidence of later payments during the trial.
Justice Abinyo dismissed the application and fixed the hearing date of the main suit on November 13, 2026.
