Africa-Press – Uganda. The Commercial Division of the High Court has summoned Aya Investment to file its defence in a case filed against it by Sanlam General Insurance which is seeking its liquidation.
Aya has been given 15 days to file its reply to the suit.
“Take further notice that in default of doing so, the petition will be heard and determined in your absence,” the June 15 court summon reads.
In the suit, Sanlam Insurance wants Aya Investment put under liquidation for allegedly failing to pay it Shs259m, endorsed by the Commercial Court.
Court documents indicate that between 2018 and 2019, Aya took out various insurance policies from Sanlam including workers compensation and fidelity guarantee insurance policies, but allegedly defaulted on Shs178m payment, despite demands and reminders.
“The petitioner (Sanlam) wrote several e-mails and letters reminding the respondent (Aya) of its indebtedness and to make good the said debt, but the respondents failed to settle the same,” the court documents read in part.
The court summonses against Aya were extracted by Irumba & Co Advocates, the lawyers representing Sanlam.
On June 23, 2022, Justice Jeanne Rwakakooko ordered Aya to pay $38,773 and Shs33m, which it owed Sanlam.
In addition, Aya was ordered to pay $11,631 (Shs43m), Shs22m as costs, Shs5m as general damages and Shs10m as interest rate on the award.
But following the judgment, Sanlam argues that it commenced the execution process but it is now more than seven months since the notice to show cause and judgement were served on Aya but the same have been ignored and all efforts made to execute the same have not yielded much results.
It is upon this account that Sanlam is now seeking a declaration of the court that Aya is unable to pay its debts as per section 3(1)b of the Insolvency Act 2011 so that a liquidator is appointed to commence the liquidation process.
The liquidation of a company is when the company’s assets are sold and the company ceases operations and is deregistered.
The assets are sold to pay back various claimants, such as creditors and shareholders.
The liquidation process happens when a company is insolvent and it can no longer meet its financial obligations.
The insurance company argues that if the liquidation is not done, it stands to lose a lot of money that Aya allegedly owes them.
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