Developer of Buxton apartments sued over contract termination
Ongoing construction of the Buxton housing project in Mombasa City on February 7, 2022.
The Sh6 billion Buxton housing project in Mombasa is in limbo after a dispute arose over the termination of the builder’s contract.
Philmark System Services Ltd, which is constructing the modern housing units, has sued Buxton Point Developers Ltd for illegally terminating its contract.
Mombasa High Court Judge Olga Sewe has certified this case as urgent and ordered court documents to be supplied to all parties before the matter is set for hearing.
Court documents filed by Philmark show it has completed 70 units and 40 per cent of phase one of the project involving District A and B, which has 90 units.
Roton Construction Ltd had won the tender for the project but subcontracted the work to Philmark to complete District A and B for Sh510 million.
Philmark received a letter terminating its contract on February 28, prompting it to move to court.
Through its advocate Paul Magolo, the firm says the termination of the contract did not follow due process and the rules of natural justice.
"Despite the termination of the contract, the firm has not been paid for the work done so far and materials ordered and delivered on site," Mr Magolo said.
Philmark director Philemon Okello said the company had suffered a loss of more than Sh200 million following the termination of the contract.
"I was harassed when I visited the premises to collect materials including computers and laptops," he said in court documents.
Mr Okello claims in a sworn affidavit that the defendants intended to demolish offices and that the firm's equipment and machines still on the site were being vandalised and misused.
He wants the court to suspend the termination of its contract and restrain any company from completing the work until its complaints are determined.
"Since we began construction, no valuation certificate has been raised to effect payments pursuant to work done, and instead, advance payment was usually made to us on request," Mr Okello said.
Mr Okello also wants the court to declare the termination of the contract illegal. He wants his firm paid for work done and for materials delivered and Sh200 million in damages for loss of profit.
The project started last May but construction was delayed due to a court case filed by tenants of the former Buxton Estate.
When the court gave the green light for the project to proceed, the Senate’s Committee on Roads and Transport halted it and directed Mombasa Governor Hassan Joho to provide clarifications on the complaints raised by residents.
The residents, through Mombasa Senator Mohamed Faki, complained that the views of the public had not been sought and that the process that led to the signing of a deal between the county and Buxton Point Apartments was not transparent.
Mombasa businessman Suleiman Shahbal is banking on the project to boost his bid for the governor’s seat.
Phase one of the project was expected to be completed by May this year.
It is one of the mega projects that the government is undertaking across the country. The apartments will be sold to the general public under its affordable housing scheme.
Once the project is completed, more people would have been transformed from tenants to homeowners.
It includes building 600 one-bedroom, 700 two-bedroom and 600 three-bedroom units on 14 acres. The units are expected to be ready by May next year.
