Lawpoint Uganda

On foreclosure, the court reaffirmed, that the statutory notices under the Mortgage Act (Sections 18, 19, 25 and 27) are mandatory. Since the defendant had issued only the forty-five working days' default notice and had not adduced evidence of all required notices, foreclosure was declined at this stage. On interest, the court awarded simple interest at 10% per annum from the date of judgment, following the approach

The court found that the bank breached this duty by relying on a stale valuation report containing manifest errors, delaying the sale for months after the initial advertisement, and conducting an opaque auction process with no documentary proof of competing bids. The court noted that the property was sold at a gross undervalue of UGX 135,000,000/=, despite the plaintiffs having identified a buyer willing to pay UGX 235,000,000/=.

The Court clarified the precise trigger point of Regulation 13 of the Mortgage Regulations, 2012. Her Ladyship found that the foreclosure process commenced on 30 October 2025 when the Bank issued a formal Notice of Default under Section 18 of the Mortgage Act. The court rejected the Registrar's reasoning that Regulation 13 was inapplicable merely because no auction had yet been scheduled, holding that to do so would allow mortgagors to bypass the 30% rule by filing before a s

Actions for redemption of mortgaged land must be commenced within twelve (12) years from the date the cause of action accrues. The Court further clarified that limitation extinguishes not only the remedy but the right itself in actions for recovery or redemption of land.

The Court rejected the defenses of non est factum and procedural unconscionability but intervened on substantive unconscionability grounds to reduce excessive interest rates. It underscored the heavy evidentiary burden on borrowers alleging forgery or illiteracy-based defenses, reaffirmed that repealed laws continue to apply to vested contractual rights, and confirmed the Court’s equitable jurisdiction to reopen harsh or oppressive loan terms.

a statute “is not passed in a vacuum, but in a framework of circumstances, so as to give a remedy for a known state of affairs.” The court emphasised that the purpose of the Mortgage Act is not to furnish borrowers with technical loopholes to stall repayment but to balance borrower protections with the lender’s legitimate right to prompt enforcement. Technical breaches should not be elevated above the broader policy goals of market stability, efficient debt recovery, and sup

Lending institutions must ensure that a company resolution is in place before accepting company property as loan security. In its absence, such transactions risk being invalidated for lack of proper authorization under company law. Moreover, The court reaffirmed the duty of banks and financial institutions to conduct thorough due diligence, especially when accepting corporate property as collateral. Failure to verify corporate approvals or the identity of borrowers may lead t