The High Court Commercial Division has delivered a fresh victory for Equity Bank Uganda and Equity Bank Kenya after dismissing an application by businessman Dr. Matthias Magoola and his companies seeking to stop the work of an independent auditor appointed to examine a UGX243 billion loan dispute.
In a ruling issued electronically on July 29, 2026, Justice Susan Abinyo rejected claims by Dr. Magoola, Dei Industries International Limited and Dei BioPharma Limited that the Institute of Certified Public Accountants of Uganda (ICPAU) had compromised its independence when appointing Clayton & Company to conduct the audit of the disputed loan accounts.
The court held that the applicants failed to provide sufficient evidence showing that ICPAU’s decision-making process lacked integrity, objectivity or independence. The ruling allows the audit process to continue, although the judge clarified that it does not yet determine whether the companies owe the banks the claimed amounts or whether the loan balances were wrongly calculated as alleged.
The dispute arises from credit facilities extended to Dei Industries International Limited by Equity Bank Uganda and loans provided to Dei BioPharma Limited by Equity Bank Kenya between 2016 and 2021. The funds were reportedly used to support business operations and the development of a pharmaceutical manufacturing facility in Matugga, Wakiso District.
The disagreement intensified after the government approved a UGX578.4 billion investment in Dei BioPharma, with the current legal battle focusing on loan balances estimated at UGX243.25 billion. Both sides had earlier agreed that an independent audit would provide clarity on the financial records and outstanding obligations.
KPMG was initially appointed to conduct the audit following a court-approved consent in December 2024, but Dei Industries later challenged the appointment. The court subsequently directed ICPAU to select another independent audit firm, leading to the appointment of Clayton & Company of Jinja, which reviewed documents from both parties and submitted its findings to court.
Dr. Magoola and his companies later returned to court challenging ICPAU’s appointment, arguing that the audit process had been compromised. However, Justice Abinyo ruled that Equity Bank’s Head of Legal, Elizabeth Nayiga, was legally permitted to respond to the application and that ICPAU was not required to consult the parties before selecting an auditor, as doing so could affect the independence of the process.
The court consequently dismissed the application with costs in the cause, allowing the audit findings to remain part of the ongoing proceedings. The main case, which will determine the actual loan liabilities and address allegations of improper charges and inflated balances, is expected to continue before the Commercial Division of the High Court later this year.
