The High court has ordered Bishop Dr Hamlet Kabushenga Mbabazi to refund more than Shs 405 million in donor funds received for projects under the Child to Family Community Development Organisation (CHIFCOD) but which he failed to account for.
Justice Anna Bitature Mugenyi, head of the Commercial Division, also ordered Kabushenga to pay interest at 10 per cent per annum from January 12, 2022, until the money is fully paid, as well as the costs of the suit.
In a ruling, justice Bitature recognised Honest Wilkins Natukwasa and Eleanor Nyamishana as the legitimate directors of CHIFCOD following Kabushenga’s resignation in April 2020. However, the judge ruled that all three would remain members of the organisation.
Kabushenga, a former MP for Kinkiizi East County and bishop of the Free Methodist Church, founded CHIFCOD in 2016. The organisation operates Great Lakes Regional College Kanungu, Kirima Parents Primary School, Rutenga Parents Primary School, Nyakabungo Parents Primary School and Great Lakes High School.
The case arose from complaints by several funders, including Uganda Development Initiative, Kirima Limited, the Protestant Church of Eppingen in Germany and CHIFCOD Enterprises Limited, over the management of funds intended for the organisation’s educational projects.
In Civil Suit No. 0018 of 2022, the plaintiffs, represented by MMAKS Advocates, asked the court to compel Kabushenga to refund the money, return organisational property registered in his name, withdraw permanently from CHIFCOD’s activities, and pay damages and legal costs.
The funders told the court that John Rutherford, a member of Kirima Limited, visited Nyakabungo and Kirima primary schools in 2019 and found that the main halls at both schools and a laboratory at Great Lakes High School were incomplete despite funds having been released for the projects.
They accused Kabushenga of engaging IBB International Limited to prepare progress reports that allegedly indicated that Shs 179.4 million had been spent on the construction of the main hall at Kirima Primary School and Shs 207 million on the hall at Nyakabungo Primary School.
The plaintiffs further alleged that the institutions owed taxes to the Uganda Revenue Authority (URA) despite the release of funds intended to settle the obligations.
They also accused Kabushenga of mortgaging property belonging to Great Lakes Regional University with PostBank Uganda to secure a loan, which they alleged he used to finance personal development projects in Kampala and Busiro, Wakiso district.
The case also included an allegation that Kabushenga authorised a payment of more than Shs 2 million without specifying its purpose.
Kabushenga, represented by Alvarez Advocates, led by Patrick Alunga Alvarez, opposed the claims. He argued that the donors had no right to demand accountability for the funds and maintained that 80 per cent of CHIFCOD’s assets existed before the funders became involved.
He also challenged the directorship of Natukwasa and Nyamishana, accusing them of forging documents to present themselves as directors of CHIFCOD Enterprises Limited.
Natukwasa welcomed the ruling, saying he was pleased that the court had delivered justice and cleared his and Nyamishana’s names in the dispute.
Efforts to obtain a comment from Kabushenga were unsuccessful, as his mobile phones were unavailable by press time.
The dispute over CHIFCOD’s leadership had previously disrupted the operations of Great Lakes Regional University, prompting the involvement of security authorities and the National Council for Higher Education.
The institution was closed for a month in November 2021 amid the leadership wrangles, which also resulted in several other closures.