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Lawyers say SGR dispute not yet over

By Everlyne Kwamboka | June 19th 2020

The dispute on the multi-billion-shilling Standard Gauge Railway contract is not yet over.

The judgment by the Court of Appeal to declare the entire contract illegal may end up in the international court since it stops the government from performing its dues agreed in the document signed between the parties.

It is a legal document to be used in a legal battle by the foreign government within the jurisdiction it agreed on with the Kenyan team to have disputes arising from the deal solved even with the project between Mombasa and Nairobi having fully been completed.

Lawyer Peter Kaluma said the judgment by three appellate judges curtails performance of the contract and grants the contracting parties solid basis to avoid performing their obligations under the SGR contract.

“Breach of the constitution renders anything or any act done in consequence of the breach unconstitutional, null and void. Violation of the law or illegality vitiates and renders contracts incapable of performance by the contracting parties and unenforceable in law,” he said.

Terming the decision as “earthmoving”, he said it has immediate implications to the SGR contract and overall impact over procurement and disposal processes.

On the issue of jurisdiction as to whether the judgment is binding on both countries, some of the lawyers interviewed by the Standard said it would be tricky for the foreign government to challenge it because China Road and Bridge Corporation (CRBC) owned by the Chinese government participated in the case.

Lawyer Harun Ndubi said the Chinese government is likely to challenge the decision at the international court if Kenya does not honor the issues agreed on in the contract, given that it was not a party to the dispute in both the High Court and Court Appeal.

He added that this also gives Kenya a leeway not to pay for the loan advanced for the project or honor other issues in the document that has been declared illegal by the court.

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