Uchumi Supermarkets wants Kenya National Trading Corporation (KNTC)’s two top officials fined Sh203 million and jailed for six months for alleged violation of court orders protecting the retailer from adverse action such as eviction or asset attachment.
In a curious court battle that pits two institutions that report to the Industrialisation, Trade and Enterprise ministry, Uchumi says that during an illegal October 16, 2021 eviction from its headquarters in Nairobi’s Industrial Area, property worth at least Sh203 million was destroyed.
Uchumi now wants KNTC CEO Pamela Mutua and human resource boss Jeremiah Opata fined ordered to pay for the damage, but still spend six months in jail for violating court orders.
The retailer’s headquarters is in a KNTC building.
The protection orders were given in an insolvency petition filed by creditors against Uchumi.
Through the insolvency petition, Uchumi became the first Kenyan corporate institution to undergo a company voluntary arrangement (CVA) – a deal in which creditors hold on any debt recovery but still supply the struggling company so as to give it a chance of revival.
In the insolvency petition, the High Court issued orders on October 1, 2021 barring eviction of Uchumi from any premises it occupies.
The orders also directed landlords who wish to terminate their relationship with Uchumi to first seek permission of CVA supervisor Owen Koimburi, and the courts.
Uchumi Chief Finance Officer Lawrence Ngao says in court papers that KNTC bosses only accepted his service of the court orders past midday on October 16 when a lot of damage had already been done to the retailer’s headquarters as part of the eviction.
The retailer holds that KNTC hired nearly 200 individuals to conduct the eviction without the supervision of police.
“Be that as it may, Mr Opata, after receiving the High Court’s order, went ahead to vacate the scene of the eviction, leaving his hired men to proceed with the eviction. It was at this juncture that the said men finalised their removal of the applicant’s assets from the premises and thereafter embarked on removing all doors, windows, burglar bars and electrical installations as well as demolishing the stairs, offices and all standing structures within the suit premises,” Mr Ngao says in court papers.
Mr Ngao adds that the eviction, which was covered by the media, ruined Uchumi’s reputation, as it portrayed the retailer as unable to pay rent.
Neither the KNTC, Ms Mutua nor Mr Opata has responded to the contempt of court application.
Uchumi argues that the KNTC is one of the parties in the insolvency petition, hence it should have been aware of the orders issued barring eviction of the retailer.