Royal Mabati not loyal: How Iron sheet distributor duped clients

A roofing professional at work. 

Silas Koech placed an order for iron sheets and roll tops in April 2018 and was promised that they would be delivered in two days. He placed the order through Mr Okari. The order arrived after two weeks.

Despite the delay, Mr Koech placed another order on June 5, 2018 for more iron sheets and roll tops.

Royal Mabati’s sales team promised that the order would be delivered within seven days and that Mr Koech’s details were still in the company’s system and there was no need to specify details afresh.

The new order arrived after two weeks, but the iron sheets delivered were not of the kind Mr Koech had ordered.

He refused to accept the order, and the delivery team would not return the unwanted iron sheets to Royal Mabati.

The standoff caused construction delays and rain damaged roofing timber on Mr Koech’s house, which he replaced at his own cost.

Gilbert Owino placed an order for charcoal grey mabati on August 17, 2018 after seeing the company’s advertisement. He was promised delivery within 48 hours.

Several weeks later, Royal Mabati asked Mr Owino to change his order to blue corrugated iron sheets. Mr Owino agreed.

But by the time the CAK issued a notice of investigation to Royal Mabati on October 1, 2018, more than one month later, Mr Owino had not received any iron sheets.

Others who were forced to change their orders were Daniel Kariuki Mwangi, Isaac Malanga and Leonard Rono. Mr Mwangi was also forced to pay for delivery, contrary to Royal Mabati’s advertisements.

Lewis Mose, Gilbert Mabwai, and Joash Midiwo eventually got refunds but after a protracted fight and long wait.

Mr Mabwai made his order in June 2017 and was promised that they would be delivered within two days. By December 2017 he had not received anything and Royal Mabati asked him to pick another product and pay more for the fresh pick.

Mr Okari, Muthee Kagwa, George Njoroge, Patrick Ondieki, Valerie Wanjala and Francisca Owuor eventually received their orders but suffered losses because weather conditions damaged their construction sites.

CAK sent separate investigation notices to Royal Mabati in respect of each of the 13 complaints.

The company only responded to the complaint from Mr Mose, stating that Royal Mabati has internal dispute resolution mechanisms that the client should have used.

Now, the roof has come tumbling down on Royal Mabati Factory, a leading iron-sheets distributor, after the Competition Tribunal green-lit a Sh2.6 million fine for several offences involving bait and switch, false advertising and violation of sale agreements with clients.

The tribunal has upheld a decision by the Competition Authority of Kenya (CAK) to fine Royal Mabati Sh2.6 million in relation to complaints by 13 clients who were taken through financial hell while trying to purchase iron sheets.

CAK initially fined Royal Mabati on May 21, 2020.

But the iron-sheets distributor appealed the decision at the Competition Tribunal.

Proceedings before the tribunal indicate that CAK has been investigating several complaints against Royal Mabati since 2018.

Annual reports on CAK’s website show that dozens of other customers have filed fresh complaints against Royal Mabati after the watchdog slapped it with the fine, an indication that company could part with more millions in fines.

Daniel Ogola, Rebecca Mogire, Valentine Mwende and Destaings Nyongesa ruled that evidence before them showed that Royal Mabati had violated the Competition Act and the CAK fine could not be faulted.

The tribunal noted that Royal Mabati defied a cease-and-desist order on false advertising as the company continued to bait clients in the course of the legal battle.

Many of the clients have filed fresh complaints with the CAK, the tribunal proceedings show.

“Uncontroverted evidence on record shows that despite having been issued with a cease and desist order, Royal Mabati continued to offend the said order and provisions of the Competition Act. The CAK continued to receive new complaints in the course of the investigations and after the issuance of the cease and desist order,” the four-member tribunal said in its judgment.

Following an avalanche of grievances against the company, CAK consolidated 13 complaints filed by individuals alleging violations of purchase agreements.

CAK officers simultaneously investigated complaints by Joseph Agwata Okari, Daniel Kariuki Mwangi, Gilbert Owino, Patrick Ondiek, Leonard Rono, Lewis Mose, Muthee Kagwa, Isaac Malanga, Valerie Wanjala, Joash Midiwo, Francisca Owuor, George Njoroge and Gilbert Mabwai.

Investigations revealed that Royal Mabati was engaging in false advertising by promising customers that their orders would be delivered within specified times, ranging from 24 hours to two weeks, and at no cost.

The Competition Tribunal has ruled that Royal Mabati had made false representations to customers on delivery costs and timelines, while also failing to honour refund promises.

The tribunal added that Royal Mabati shifted goal posts by inserting clauses into sales contracts along the way, meaning clients were not aware of what they were getting into.

“In all the above cases, Royal Mabati did not deliver the customers’ orders within the timelines provided. Royal Mabati aggravated the delay by remaining unresponsive to the complaints of its customers who were already in despair as they continued to suffer loss because of the delay,” the tribunal said.

“In this regard, we find that the conduct of Royal Mabati was unconscionable.”>

The panel added: “There is no evidence that the customers were aware of Royal Mabati’s refund policy prior to entering into the contracts. Some of the terms of the contracts were built into the contract, by Royal Mabati, as parties went along.”

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