MTN appeals Shs.2.3 billion judgment awarded to ex employee Richard Mwami

Six days after the High Court ordered MTN Uganda to pay more than Shs 2.3 billion to its former employee, Richard Mwami, for malicious prosecution, the telecommunications giant has formally kicked off the appellate process by filing a Notice of Appeal and requesting certified copies of the court record.

Documents filed on July 2 by MTN’s lawyers, Kampala Associated Advocates, show that the company intends to challenge the June 26 judgment of Acting Justice Isaac Bonny Teko, which found MTN liable for maliciously prosecuting Mwami over the 2012 mobile money fraud case.

The High Court awarded Mwami Shs1.809 billion in special damages, Shs400 million in general damages and Shs100 million in exemplary damages, together with interest and costs, after concluding that MTN had been the “moving force” behind the criminal proceedings despite the company’s own forensic audit reportedly not implicating him.

MTN, however, maintains that the judgment raises fundamental legal questions regarding the respective roles of private complainants, investigators and prosecutors in Uganda’s criminal justice system.

According to sources familiar with the company’s legal position, MTN’s appeal will principally challenge the finding that it was legally responsible for Mwami’s prosecution.

The company contends that once it discovered suspected fraud involving billions of shillings on its mobile money platform, it fulfilled its legal duty by reporting the matter to the Uganda Police Force for investigation.

Thereafter, the investigation, assessment of evidence, sanctioning of charges and prosecution of suspect became the constitutional responsibility of the State through the Director of Public Prosecutions (DPP), an office that exercises independent prosecutorial powers.

Legal experts who spoke to this publication said this issue is likely to become the centerpiece of the appeal.

“In Uganda, criminal proceedings are prosecuted by the State. That is why every criminal case is brought in the name of the Republic, for example, ‘Uganda versus…’ rather than in the name of the complainant,” one senior lawyer explained.

The experts argued that while complainants provide information to investigators, decisions on whether sufficient evidence exists to charge a suspect rest with the Police and ultimately the DPP, whose prosecutorial independence is protected under the Constitution.

They observed that if the High Court’s decision is left unchallenged, it could have significant implications for companies, financial institutions and ordinary citizens who report suspected crimes to law enforcement agencies.

Several lawyers described the ruling as establishing a potentially far-reaching precedent, warning that complainants could increasingly face civil liability even after independent investigations and prosecutorial decisions have intervened.

“The Court of Appeal now has an opportunity to clarify where the legal line should be drawn between reporting suspected criminal conduct and being held liable for malicious prosecution,” another legal expert said.

The experts stressed that their views should not be interpreted as criticism of the High Court but as highlighting an important legal question that deserves authoritative determination by the appellate court.

In the impugned judgment, Justice Teko concluded that MTN did more than merely report suspected fraud.

The court found that the company actively instigated and procured the prosecution of Mwami and therefore satisfied the legal requirements for liability in malicious prosecution.

It was on that basis that the court entered judgment against MTN while striking out the Attorney General from the suit after finding the claim against the Government had been filed outside the statutory limitation period.

Following the ruling, MTN issued a brief statement saying it was carefully studying the judgment with its legal advisers.

“We are studying the judgment carefully with our legal advisors and are considering all available options, including an appeal. MTN Uganda remains committed to the highest standards of corporate governance and to conducting its business in accordance with the law,” the company said.

The filing of the Notice of Appeal now confirms that MTN intends to challenge the decision before the Court of Appeal, setting the stage for what is expected to be one of the country’s most closely watched corporate litigation battles.

Beyond the financial award, legal observers say the appeal could determine the extent to which companies that report suspected criminal activity may later be held liable for prosecutions ultimately undertaken by the State, a question that could shape Uganda’s law on malicious prosecution for years to come.