Assembly unfairly ended Sh13.3m Speaker residence fence contract

A Kitale court has found the Trans Nzoia County Assembly guilty of unfairly terminating a Sh13.3 million contract and payments to a contractor who put up a perimeter wall around the Speaker’s official residence in 2015.

The work was 90 percent complete at the time the contract was terminated.

Senior Principal Magistrate Mary Immaculate Morang'a found that the assembly acted illegally when it ended the contract of Mika Investments Company on the grounds that the Ethics and Anti-Corruption Commission (EACC) had raised red flags about the tendering process.

Court documents show that Mika Investment sued the assembly on claims that in 2013, the firm submitted a tender bid to build a perimeter wall for the Speaker’s official residence in Milimani estate in Kitale. 

Won tender

The company won and was awarded tender number CATN/11/1/2013/14.

On September 23, 2013 the two sides signed a contract for a perimeter stone wall for about Sh13 million.

Court documents show Mika Investment satisfactorily had completed 90 percent of the work when the assembly awarded the contract to a different entity.

The director of the company, Mr Michael Kariuki, said he had met all the requirements of procurement. He said he started the work with his own capital.

“I proceeded with the construction after following the due processes of procurement and award of contract. I used my own capital to commence the construction upon which I made a request for partial payment of Sh3.5 million,” Mr Kariuki said.

Payment voucher

He said county assembly officials, led by the project manager, rushed to the scene to inspect progress and he was issued with a payment voucher in December 2014 but he did not receive cash despite repeated requests.

He later learned that the project had attracted the attention of the EACC, with two senior officials in the county assembly being charged in an Eldoret court. The work was suspended and the firm’s accounts frozen.

“I later learnt that my contract had been terminated and a new contractor was brought on site [and] completed the construction of the project using material that I had left at the site. This was a breach of contract,” he told the court.

Because he was not paid, he was unable to pay taxes and dividends.

Mr Bernard Simiyu, a procurement officer in the assembly, said the contract and the payments were stopped pending the hearing and determination of the case in which the officials were eventually vindicated.

The magistrate found the assembly guilty of breach of contract as there was no evidence of illegality or flaws in the procurement of the contract under the Public Procurement and Assets Disposal Act.  

“The court finds the suspension of the contract or termination was unreasonable, especially since EACC did not charge the plaintiff or recharge any of the defendant’s employers and agents,” read the judgment.

She added: “Having confirmed through the defendant’s architect, there was no doubt that 90 per cent of the initial contract sum of Sh13,341,642 was done, hence the claim is valid and proved on balance of probability.”

She also awarded special damages of Sh9,841,624 and interest from the date the case was filed.

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