Court Orders Muwema Advocates to Deposit $100,000 in Property Dispute

The Court of Appeal has imposed a financial requirement on the law firm M/S Muwema & Co Advocates, ordering them to deposit $100,000 (approximately Shs370 million) as security for costs. This deposit is a condition for the firm to secure a stay of execution on a substantial monetary decree awarded to Downtown Investments Limited.

Justice John Mike Musisi, a single appellate judge, issued the directive, giving the law firm one month to either make the cash deposit directly to the court or provide an unconditional bank guarantee from a reputable financial institution.

The case originates from a 2014 lease agreement where Muwema & Co Advocates rented commercial property in Kololo. The agreement included an option for the firm to purchase the premises. However, relations soured when the firm attempted to exercise this option in 2021, with the landlord deeming their $1.05 million offer insufficient.

This disagreement led to a lawsuit by the landlord, Downtown Investments, seeking possession, rent arrears, and damages. In February 2026, the High Court ruled in favor of Downtown Investments, ordering the law firm to vacate and pay over $520,000 in arrears and damages, plus interest and costs.

Muwema & Co Advocates appealed this decision, arguing that their purchase option transformed the legal relationship from landlord-tenant to vendor-purchaser and that enforcing the decree would irreparably harm their practice.

Justice Musisi acknowledged that the appeal raised arguable legal points concerning the purchase option and the calculation of mesne profits. However, he rejected a stay without security, noting that while the property had been repossessed, the financial obligations remained. He deemed $100,000 a balanced figure, representing a significant portion of the rent arrears and similar to a previous commitment fee offered by the firm.

The judge clarified that while the monetary aspects of the decree are stayed, the eviction already executed stands. The stay will be voided if the security is not provided within the stipulated 30 days. The costs for this application will be determined by the final appeal outcome.

This ruling comes after previous reports of the law firm being evicted from the Kololo property following the High Court’s judgment.