Cyrus Jirongo

Politician Cyrus Jirongo as pictured during a function in Nairobi on January 7, 2021. 

| File | Nation Media Group

Sh10bn land seized by State deepens Cyrus Jirongo’s court battles

What you need to know:

  • Mr Jirongo’s latest, and probably most crucial, legal challenge involves the Ruai property, which government agencies repossessed last year.
  • Nairobi Water and Sewerage Company (NWSC) officers seized the land with the help of dozens of police officers in early May 2020.

For close to a decade, former Lugari MP Cyrus Jirongo has been a near permanent fixture in Kenya’s courtrooms, as business dealings from his days as a powerful government bureaucrat keep resurrecting legal questions that require a judge’s determination.

From civil and commercial matters to criminal cases, Mr Jirongo has had to either appear in person or instruct lawyers to represent him in court.

Some of his more recent court appearances are intertwined, as they relate to his dealings with a collapsed bank, Postbank Credit Ltd, and a 1,000-acre piece of land in Ruai valued at about Sh10 billion.

Mr Jirongo’s latest, and probably most crucial, legal challenge involves the Ruai property, which government agencies repossessed last year after asserting that it was grabbed from the Nairobi Water and Sewerage Company (NWSC).

NWSC officers seized the land with the help of dozens of police officers in early May 2020 and insisted it was set aside for the expansion of the agency’s water treatment plant that sits on an adjacent plot.

Mr Jirongo has for at least seven years fought several court battles to take ownership of the prime property, which he has in the past admitted is his ticket out of a financial quagmire.

In 2014, Mr Jirongo filed two cases against the Kenya Deposit Insurance Corporation (KDIC), which wanted to auction the land to recover a Sh20 billion debt it claimed he owed collapsed Postbank Credit.

In the first case, Mr Jirongo challenged the legality of the auction attempt, and in the second he questioned the amounts claimed by KDIC.

Mr Jirongo had in the early 1990s borrowed Sh1 billion from the bank, and KDIC insisted that the debt had grown to Sh20 billion.

At the time Mr Jirongo borrowed the money, Kenya had not yet implemented the in duplum rule, which bars interest on loans from exceeding the amount lent out.

Won first round of the fight

Mr Jirongo, a presidential candidate in the 2017 General Election, revealed in the 2014 cases that he intended to sell the land and use some of the proceeds to pay a Sh30 million debt he owed a company identified as Emris Investments.

Emris sued Mr Jirongo in 2013 for breach of contract. After promising to sell a house in Imara Daima estate to Emris, Mr Jirongo offloaded the property to someone else.

The company sued Mr Jirongo for Sh50 million after he failed to honour a commitment to pay up.
Since 2014, Mr Jirongo has been seeking an out-of-court deal with KDIC to repay a significantly lower amount than the Sh20 billion claimed.

In September 2020, Mr Jirongo sued NWSC, the Ministry of Lands and the Attorney-General after the land was repossessed.

He claims to have legally acquired the property and wants the High Court to issue orders barring the government from taking possession of it.

The former MP has won the first round of the fight, as Justice James Aaron Makau dismissed an application by NWSC that sought to dismiss the case.

NWSC had asked for dismissal on the grounds that the constitutional and human rights division does not have the authority to determine a land dispute.

Justice Makau last week held that NWSC was right that the lawsuit had been filed in the wrong division, but declined to dismiss it. Instead, he ruled that the case be transferred to the environment and lands division, which will now give the parties a hearing date.

Mr Jirongo, in a past interview, told the Nation that he was to partner with Sheikh Rakadh Group, an investment firm owned by a member of the UAE royal family, to put up a city on the land.

But the deal collapsed after the Dubai investors found out that the property’s title deed was still with KDIC as security for the loan Mr Jirongo took in the 1990s.

Face fraud charges

Mr Jirongo had asked the Dubai tycoons to pay him some money, so he could clear the Postbank Credit loan and secure the title deed.

A few days after Mr Jirongo scored a small win over NWSC in the land saga, he went before the Supreme Court over a matter that could have seen him face fraud charges.

The Supreme Court quashed plans by the Directorate of Criminal Investigations (DCI) to charge Mr Jirongo for an alleged fraud scheme perpetrated in 1991, and still involving Postbank Credit.

DCI detectives had in 2016 sought to charge Mr Jirongo with forgery, claiming that he posed as a director of a company – Soy Developers – and signed documents to fraudulently get a Sh50 million loan from Postbank Credit.

Soy Developers had lodged the complaint with the DCI.

Mr Jirongo sued to stop his prosecution, arguing that it was a civil dispute that occurred more than two decades before the complaint was filed with the DCI.

In 2017, High Court Judge George Odunga faulted Soy Developers for failing to use other available mechanisms to resolve the dispute, as the time that had lapsed made it difficult to trace documents that had been used in the loan transaction.

Soy Developers and its directors – Sammy Boit Kogo and Antoinette Boit – challenged the decision at the Court of Appeal.

The Court of Appeal ruled in Soy Developers’ favour in 2019, and DCI detectives swiftly arrested Mr Jirongo afresh.

Mr Jirongo moved to the Supreme Court, and his lawyers asked Chief Magistrate Francis Andayi to suspend the trial in the meantime.

Skipped the court date

Mr Andayi declined in an August 2019 ruling and ordered Mr Jirongo to take a plea. Ordinarily, the plea would have been taken immediately after the ruling.

But, interestingly, Mr Jirongo skipped the court date and travelled to South Sudan, where an old business deal was about to kick off yet another legal battle for the former MP.

He would later take a plea as the Supreme Court case proceeded.

Last week, the Supreme Court agreed with Mr Jirongo and quashed the attempt to prosecute him.

When Mr Jirongo skipped Mr Andayi’s ruling to travel to South Sudan, he was preparing to sue the young state at the East African Court of Justice.

Mr Jirongo’s company, Yusung Construction Ltd, is seeking Sh5.4 billion for a botched deal from 2008.

South Sudan contracted Yusung to put up the John Garang Military Academy in 2008. Three years later, the government and Yusung fell out, and the company abandoned the project.

While Yusung had been paid Sh2.6 billion by the time the deal went sour, there was not much to show for the money other than the building’s foundation.

In 2019 the company sued at the East African Court of Justice, claiming the Sh5.4 billion from South Sudan that was the balance from the contract.

Yusung argued that South Sudan frustrated the contract by continuously shifting the location of the project, and that the initial Sh2.6 billion disbursement was wasted in the process.

Last year, Mr Jirongo’s firm and South Sudan officials presented an out-of-court deal to the EACJ under which Yusung would be paid the claimed Sh5.4 billion.

Declared bankrupt

South Sudan was to pay an initial $10.9 million (Sh1.1 billion) and then remit three equal instalments of $12.8 million (Sh1.4 billion).

Armed with the consent, Mr Jirongo approached Kenya’s courts to attach South Sudan’s bank accounts at Stanbic and NCBA.

In defending the suit, South Sudan argues that the official who reached a settlement with Yusung at the EACJ did not have any such authority, and that he colluded with Mr Jirongo to defraud the Juba administration.

The High Court froze South Sudan’s accounts in December. Three months later, the court allowed Juba to operate the accounts but reserve the contested Sh5.4 billion.

In May, South Sudan’s application to completely release the accounts was allowed by the Court of Appeal, which ruled that Yusung did not tender any evidence to show that Juba will be unable to pay up in the event it loses the case.

In yet another case, Soy Developers director Mr Kogo has sought to declare Mr Jirongo bankrupt for failing to pay a court-awarded Sh700 million.

Mr Kogo’s Masole Enterprises successfully sued Mr Jirongo for breach of contract.

The politician had secured a Sh700 million loan from National Bank of Kenya and used assets owned by Masole Enterprises as security. After defaulting on the loans, the bank sold the properties and Masole sued Mr Jirongo.

In 2017, the High Court declared Mr Jirongo bankrupt but suspended the decision after the politician claimed to have been unaware of the proceedings.

He was also entangled in a legal battle with controversial businessman Brian Yongo over a Sh20 million debt. Mr Jirongo was arrested in 2018 after Mr Yongo claimed that cheques issued to repay the debt had bounced and that restructuring deals were not honoured by the former MP.


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