A company signs a contract with you. Money changes hands. A dispute emerges and you take the company to court. Its lawyers persuade court that the matter should go to arbitration.
Then, as you try to commence arbitration, you discover the company you have been fighting had already been dissolved.
That is the dilemma Microfinance Support Centre confronted in its dispute with Kurbstone Investments.
In the Microfinance Support Centre vs Kurbstone Investments and Others, Miscellaneous Application, Justice Susan Odongo considered what happens when a company ceases to exist before a contractual dispute is resolved.
A $24,240 tenancy deal
Microfinance Support Centre had entered a tenancy agreement with Kurbstone on July 24, 2023 for premises on Kanjokya Street, Kisementi, Kampala.
Court documents contained in a February ruling, indicate that Microfinance Support Centre paid $24,240 (Shs89.7m) in rent and a security deposit.
But a disagreement arose, and Microfinance Support Centre filed a case in the High Court in 2024.
Kurbstone relied on the agreement’s arbitration clause, and on June 5, 2025, the Commercial Court stayed the suit and referred the parties to arbitration.
But when Microfinance Support Centre attempted to initiate arbitration, it discovered Kurbstone had been dissolved on May 27, 2024, more than a year before the arbitration order.
The party with which it was supposed to arbitrate no longer legally existed. The company had started winding up months earlier.
Documents before court showed Kurbstone had passed a special resolution to voluntarily wind up on December 15, 2023. Microfinance Support Centre argued this was not disclosed during reconciliation discussions or correspondence before it filed suit.
It also alleged Kurbstone’s Statement of Affairs and Statutory Declaration of Solvency did not disclose the tenancy arrangement or $6,000 (Shs22.2m) in unutilised funds.
Those were the applicant’s contentions, not court findings on the underlying tenancy claim.
Did Kurbstone wind up quietly?
In documents filed before court, Uganda Registration Services Bureau (URSB) told court that Kurbstone’s winding-up resolution was filed on December 21, 2023.
The notice had appeared in the Uganda Gazette on February 9, 2024 and Daily Monitor on April 25, 2024.
URSB further indicated it received no complaint from Microfinance Support Centre before issuing the certificate of dissolution on May 27, 2024.
Justice Odongo held that voluntary liquidation under the Insolvency Act must be publicised through the Gazette and a newspaper of wide circulation.
Once those requirements are met, the law can impute constructive notice to creditors and the public.
Thus, for an entity like Microfinance Support Centre, it ought to have done due diligence by monitoring its counterparty’s corporate status at all material times after signing the contract.
Corporate-status checks can determine whether a legal entity remains available to sue, arbitrate against or enforce a judgment against.
In fact, it’s a reward that will save you as a business when an unlikely dispute, like the one that faced Microfinance Support Centre, arises.
Suing a non-existent company
Kurbstone was dissolved in May 2024, yet litigation continued, and court referred the dispute to arbitration in June 2025. The judge accepted that the arbitration order could not practically stand.
Here, Justice Odongo found the arbitration order ‘inoperative, incapable of being performed’ because Kurbstone had already been dissolved.
Thus, Microfinance Support Centre asked court to restore Kurbstone to the Register of Companies.
Court distinguished between a company merely struck off the register and one formally dissolved after liquidation. Justice Odongo stated that once dissolution occurs, a company dies: it ordinarily can no longer sue, be sued or own property.
And in her ruling, she said there was no general statutory power to restore a company dissolved after liquidation, as an administratively struck-off company may be restored.
Exceptional intervention requires strong public-interest considerations.
Court characterised Microfinance Support Centre’s grievance as a private commercial dispute and found it had not demonstrated the exceptional public interest required to revive Kurbstone. The restoration request was rejected.
A partial victory
But Microfinance Support Centre nevertheless won an important part of its application. Justice Odongo set aside the June 5, 2025 arbitration order and directed that the 2024 civil suit be set for hearing on March 26, 2026, with no order as to costs.
The ruling did not decide the original tenancy dispute or whether Microfinance Support Centre was entitled to recover money.
Nor did it finally find that Kurbstone’s liquidation was fraudulent or that its shareholder was personally liable. Those questions and allegations remained distinct from the application before court.
Due diligence does not end
The case reaches far beyond one Kisementi tenancy. Corporate status can change while a commercial relationship remains alive.
A functioning company can begin winding up months after signing, and a creditor-objection window may pass before its counterparty discovers this.
That matters for businesses extending unsecured credit, landlords and tenants holding deposits, suppliers on payment terms and companies in long-running disputes.
Corporate counsel and finance teams must monitor significant counterparties for changes in registration status, insolvency filings and winding-up notices.
Businesses in disputes should establish early whether their opponent remains capable of being sued or participating in arbitration.
For substantial exposures, whether the contracting company has assets to satisfy a future award or judgment may matter as much as whether the claimant can win.
Where a counterparty begins liquidation, creditors need to understand quickly how to lodge claims rather than assume ordinary litigation will continue.
The ruling is an uncomfortable memo for companies relying on direct notification.
Publication in the Gazette and a newspaper can have serious legal consequences even when an executive says no direct notice was received.
Thus, this turns insolvency monitoring into a risk-management issue.
The experience of Microfinance Support Centre v Kurbstone raises an important dilemma: the question is no longer simply, ‘can we sue them?’
It is: ‘Before we spend another shilling on this dispute, does the company we are suing still exist?’