The High Court in Kampala has temporarily stopped Kenya Commercial Bank (Uganda) Limited from selling a Kololo condominium owned by the late Cedric Ndilima Babu until a main case over the property is fully heard.
In a ruling delivered on 23 February 2026, Assistant Registrar Mulondo Mastula issued an interim injunction blocking the bank, its agents and auctioneers from advertising, selling, auctioning, foreclosing on, or evicting occupants from Condominium Unit No. 2 on LRV KCCA 119/19 at Plot 1, Fumu Lane in Kololo.
The property is currently occupied by Babu’s widow and their three sons.
The dispute arises from a mortgage loan of 200,000 US dollars that Babu obtained in July 2023. The bank says the loan is in default and that about 182,710 US dollars, including interest, is still outstanding.
However, Babu’s estate argues that the loan was covered by a Group Mortgage Protection Policy, which should have cleared the remaining balance after his death in May 2025.
At the centre of the case is Clause 7.17 of the loan agreement. The clause states that insurance renewals must be arranged through the bank’s bancassurance unit and that if the borrower fails to renew on time, the bank should automatically renew the cover and charge the cost to the borrower.
The court found that this clause raises a serious legal question that can only be resolved during the full trial. It noted that a plain reading suggests the bank had a duty to ensure continuous insurance cover, even if the borrower did not actively renew it.
The bank, however, maintains that the responsibility to renew the policy rested solely with the borrower and that the cover expired in August 2024 after premiums were not paid.
On the issue of harm, the court agreed with the family, ruling that eviction from a family home cannot be adequately compensated with money. It said removing a widow and her three dependent children would cause damage beyond the property’s market value.
The bank had asked the court to require the family to deposit 30 per cent of the outstanding loan before stopping the sale, as provided for under mortgage regulations. The court declined, saying the law gives it discretion and that this was not an appropriate case to impose such a condition.
The judge directed the family to maintain the property and avoid any action that could affect the bank’s security while the case is pending. The costs of the application will be decided in the main suit.
The condominium will remain under court protection until the full hearing determines whether the bank failed in its obligation to ensure renewal of the mortgage protection insurance.
