Firms want court to lift orders halting Sh6 billion NYS payments

NYS suppliers address the press over non-payment of dues, in Naivasha, on October 5, 2018. [File, Standard]

Several companies have filed an application in the High Court seeking to lift orders barring them from claiming over Sh6.2 billion from the National Youth Service (NYS).

The firms, including six linked to Benson Gethi Wangui and his associates, are challenging ex-parte orders issued by Lady Justice Lucy Njuguna, which block the state agency from paying them Sh6,167,797,655 for the alleged supply of items including boots, cooking oil, baked beans, sugar, rakes, helmets, T-shirts, army biscuits, and fuel between 2013 and 2015.

In the impugned orders, the court barred Gethi and his six companies, Highview Trading, Schoolwork Enterprises, Newtool Mart Trading, Ratego Technologies, Realtool Trading, Comptool Trading, Horizon Limited, and Jimchar Enterprises Limited, their agents, or representatives from claiming payment of the Sh6.1 billion from NYS.

The orders also restrained NYS from effecting payment of the said amount, which relates to payment vouchers serialized 000001–002901.

In their application under a certificate of urgency, the companies, through lawyer David Kirimi, asked the court to vacate the ex-parte orders and compel the EACC to release the original payment vouchers and Local Purchase Orders (LPOs), which the commission admits it holds.

The companies say the orders were “draconian” and issued without disclosure of material facts.

They argue that the court was not informed that, following a public call for pending bills incurred between July 1, 2005 and June 30, 2022, they had submitted details of 21 LPOs to the Pending Bills Multi-Agency Verification Committee (PB-MAT).

However, the companies say they were unable to provide complete documentation because the original vouchers and LPOs have been held by the EACC for over six years since investigations began, and for two years after the Director of Public Prosecutions (DPP) advised that the inquiry file be closed.

They argue that the continued withholding of their documents, coupled with court orders barring them from claiming payment, violates Article 47(1) of the Constitution, which guarantees the right to administrative action that is expeditious, efficient, lawful, reasonable, and procedurally fair.

The applicants maintain that the actions threaten their right to be paid for goods allegedly supplied to NYS.

They further fault the EACC’s application, saying it seeks to preserve funds that do not exist.

“The plaintiff alleges a ‘real and imminent danger’ and ‘irreparable loss’, yet no funds have been paid out and no loss has occurred,” the application states.

The firms accuse the EACC of abusing court process by presenting allegations as settled facts.

They argue that the commission’s affidavits use terms such as "established", “falsified”, and “fictitious”, despite the fact that no trial has been conducted, no charges approved by the DPP, and no payments made.

They add that the DPP had directed that the investigation file be closed.

They also contend that under the Anti-Corruption and Economic Crimes Act (ACECA), freezing or preservation orders can only apply to existing property or proceeds of corruption. “Where no funds have moved, there is nothing to preserve,” they argue.

The applicants further state that the pending payments were scrutinized and verified by the cabinet-appointed Pending Bills Multi-Agency Team, in which the EACC was a member, and that the process was guided by an opinion from the Attorney-General and a Cabinet directive.

They say all payments were approved except for Sh812 million.

In court filings, the EACC says Gethi and associates submitted claims for goods never supplied, colluding with NYS officials to falsify LPOs, delivery notes, stock control cards, and inspection forms.

Officials named in the suit, including Samwel Mudanyi Wachenje, Bernard Kipkoech Yatich, Julius Nyadimo Airo, and others, are accused of signing or approving documents despite knowing deliveries never occurred.

The EACC seeks a declaration that the claims are fraudulent and illegal, and wants NYS barred from honoring the payment vouchers while investigations continue.

The listed owners and directors associated with the companies include Benson Gethi Wangui, Elizabeth Wangeci Ngugi, Samwel Mudanyi Wachenje, Bernard Kipkoech Yatich, Bernard Nzioka Kioko, Julius Nyadimo Airo, John Nganga Gicharu, Titus Trouble Libondo, Isaac Wafula Kundu, Jane Wangechi Gichuki, and Chemoss Kororia Ndiema.