KPC officer, firm chief and agent in court over Sh5b deal
Business
By
Kamau Muthoni
| May 16, 2015
The High Court will determine whether to summon Kenya Pipeline Company’s legal officer and an Indian firm managing director over Sh5 billion oil tanks construction deal.
Justice Francis Gikonyo, after hearing both sides of the suit filed by a local contractor against the State Corporation and an Indian firm, will rule on whether to call for KPC’s Legal Officer Gloria Khafafa, Prashanth Ltd Managing Director Nadathur Bharath and an agent in the deal David Kingarui over their affidavits.
The local contractor (Nyoro Construction Company) lawyers had made an application to have Khafafa, Bharath and Kingarui appear in court, arguing their sworn statements were inconsistent. However, KPC through its lawyer argued that the application to have its officers appear before the court was premature.
In his submissions, he said a court could not give order to officers to be cross examined at the preliminary stages of the case, especially when a person is seeking temporary orders. “The application before the court is misguided, has no merit and is an abuse of the court process,” he submitted.
Statements filed
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In the application to have the three (Khafafa, Bharath and Kingarui) summoned, Nyoro Construction MD Josiah Njoroge had told the court that the statements filed in court were spiced with untruths and thus was important to cross examine the three about the tender. “Affidavits sworn in reply by all respondents are shrouded with half-truths and extreme exaggeration that makes it necessary for the plaintiff to cross examine the contents of the affidavits,” Mr Njoroge said.
He argued that the truth would only be known if the three tendered their evidence in person before the court. KPC on the other hand argued that there was enough evidence in the affidavits to be weighed by the court before it gave its orders.
It argues that Nyoro was disrupting the court process in order to fish for more information to support its weak case, a move that ought to be dismissed. “The application brought to court shows that they do not have enough information in the main application,” the lawyer argued. The dispute with Nyoro Construction Company centres on a Sh5 billion oil tank tender, for which the latter accuses KPC of paying its partner (Prashanth Projects Ltd) Sh600 million without informing it.
Nyoro accused its partner, Prashanth, of side-lining it from the lucrative deal. The court heard the Indian firm was allegedly intending to go solo against the terms of a memorandum of understanding agreed on by the two firms before winning the bid. “The plaintiff (Nyoro) and the first defendant (Prashanth) entered into a local participant partnership agreement, which was a pre-condition for foreign firms to qualify to bid for the tender,” argued Nyoro’s lawyer Walubengo Waningilo.
Waningilo argued the defendant’s action to receive payments without informing the partner was only meant to lock her out in the project and was contrary to provisions of the tender documents.
The court heard that KPC and the Indian firm had been holding meetings without the knowledge of the local contractor. Justice Gikonyo will rule on the case on May 25.
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