Why lawyer rejected Rai's move to settle debt owed by Mumias Sugar

Mumias Sugar Company
Photo credit: File

A Nairobi lawyer says she rejected a bid by tycoon Jaswant Rai to settle a Sh76 million debt owed to her by Mumias Sugar Company, as a condition for withdrawing the insolvency petition against the miller, because she considered it a product of blackmail.

Lawyer Jackline Kimeto said in an application filed at the High Court that she changed her mind about withdrawing the petition because it was made through threats, coercion and extreme duress.

Ms Kimeto said she was approached by an advocate allegedly sent by Mr Rai to plead with her to withdraw the petition as his client was ready to settle the debt.

“In fear of my life and all the threats that I was receiving, I filed and paid for a notice of withdrawal dated 1st September, 2023 in HC IP E004 of 2019 on the understanding that my debt would be settled within 1 hour of the said notice being filed as indicated,” Ms Kimeto said.

She added although the debt has never been settled even after filing the notice for withdrawal, she considered the plan to settle the debt a product of blackmail by state agents.

Ms Kimeto said she later rejected all offers for payment. “I have since filed a letter with the court cancelling the said notice of withdrawal on account that it was obtained from me through threats, coercion and extreme duress which I am currently experiencing to date,” she said.

The lawyer is now asking the court to appoint the official receiver as the administrator of the troubled miller.

The application was mentioned before Justice Alfred Mabeya who directed the matter to be heard on October 4.

The court placed the company under court supervised administration on November 19, 2021 and appointed Mr Ponangapali Romana Rao as the administrator but he was later removed by Justice Mabeya after bungling the leasing process.

The court had appointed Mr Harveen Kumar Gadhoke the administrator but he declined the appointment on August 28, citing various reasons.

She says the withdrawal of Mr Gadhoke as an administrator makes it necessary for the court to appoint a new administrator to undertake and complete the administration process that had been ordered by the court.

Ms Kimeto said in the absence of an administrator, she is unable to file her debt claim for purposes of settlement. “It is my wish that my debt be settled in full to enable me withdraw this petition,” she said.

She said she continues to receive threatening calls and messages from various individuals that had had the effect of intimidating her to withdraw the case.

“I am also living in fear of my life and safety because of the continued existence of this suit,” she said.

She now wants the court to appoint an official receiver as the administrator for Mumias Sugar, pending the determination of the petitions.

She also wants Mr Rao compelled to file a full and comprehensive report of all activities and financial accounts he had undertaken since November 2021.