Patrick Maag, a businessman, has won the right to fully defend himself in court after Bank of Africa sued him, demanding more than Shs 113 million following the sale of his mortgaged home in Naalya.
Justice Patience Rubagumya of the Commercial Division of the High Court said the dispute raised serious legal and factual questions that could not be decided through a fast-track summary procedure.
“The facts and evidence presented indicate that the amounts claimed are contested, and it is therefore in the interest of justice that the Applicant be granted leave to appear and defend the main suit,” the judge ruled.
The dispute traces its roots to August 2, 2019, when Maag approached Bank of Africa for a mortgage loan to buy a two-bedroom apartment in Naalya.
According to court records, Maag applied for Shs 143 million. However, the bank disbursed Shs135 million. Maag told the court that this shortfall forced him to borrow money elsewhere to complete the purchase of the apartment, which he intended to use as his residence.
After receiving the loan, Maag said he immediately started servicing it. His first payment was Shs17 million.
But his repayment plans were disrupted in 2020 when the COVID-19 pandemic hit.
Maag told the court that due to financial strain, he requested a six-month mortgage holiday and asked the bank to convert the loan into US dollars. The bank agreed. However, a new dispute arose when the bank demanded Shs157 million, a figure Maag strongly contested.
Despite the challenges, Maag said he continued making monthly payments of Shs 2.4 million as reflected in his bank statements.
In June 2020, Maag said the bank informed him that his apartment had been sold and that his loan balance stood at Shs 59 million.
When he later reviewed his account statements, Maag discovered that the loan balance had been written off.
“I legitimately believed that the matter was concluded,” he stated in his affidavit.
That belief was shattered in October 2025, when Bank of Africa filed a summary suit against him, demanding Shs113 million as the outstanding loan balance.
Maag was shocked.
He argued that the bank could not have sold the apartment in 2022 for Shs 77 million, which was far below the property’s value in 2019. He also claimed it was irregular for the bank to continue charging interest after foreclosing on and selling the property
Bank of Africa, through its legal manager for litigation, Fahad Mading, rejected Maag’s claims.
The bank said the suit was simply an effort to recover an outstanding loan balance of Shs 113 million as of July 30, 2025, together with interest until payment in full.
The bank explained that Maag had defaulted on his loan, prompting it to instruct Bageine and Company in October 2021 to conduct a forced sale valuation of the Naalya property.
According to the valuation report dated November 2, 2021, the apartment had a market value of Shs 180 million and a forced sale value of Shs 120 million.
After issuing the required notices, the bank sold the property to Yohannes Mesfin Woldermicheal for Shs 131 million.
As of June 2, 2021, the bank said Maag’s loan balance stood at Shs 185 million. After applying the sale proceeds, the outstanding balance was reduced to Shs 65 million. This amount, the bank said, continued to accrue interest until it reached Shs 113 million by July 2025
On the issue of write-off, the bank said Maag misunderstood banking practice.
Maag was represented by Buwembo and Company Advocates. His lawyers argued that the case involved serious disputes over how the property was sold, how much it fetched, and whether interest could continue running after foreclosure.
They insisted that these issues could only be resolved through a full trial.
Bank of Africa was represented by Derrick Kizito and Hellen Ndagire of MMAKS Advocates. They argued that Maag had no valid defence and that the case was suitable for summary judgment.
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In the end, Justice Rubagumya disagreed with the bank.
She explained that under the summary procedure, a defendant must be allowed to defend the suit if they raise a bona fide triable issue of law or fact.
The judge noted that key questions remained unanswered. These included whether the apartment was lawfully sold and whether Maag remained indebted after foreclosure.
“Therefore, the court must investigate further whether the property in issue was lawfully sold and whether Maag is still indebted to the bank after foreclosure,” she ruled.
The court granted Maag unconditional leave to appear and defend the main suit. He was ordered to file his defence within 15 days, after which the bank will reply.
