Firm loses Sh66 million case for supply of Beyond Zero clinics equipment

Dorms Miriuki (left) and Daniel Kiraitu (centre) attend to a patient during the launch of the Beyond Zero Campaign at Kongo health centre in Meru Central on March 22, 2016. [File, Standard]

Businessman Paul Otieno must be loathing the day a senior official from the Ministry of Health called him to install medical equipment on seven containers part of the Beyond Zero Campaign clinics.

In the end, Otieno's Sunken International Limited lost a whopping Sh66 million.

Otieno told the court that then Director of Medical Services Nicholas Muraguri called him when he supplied equipment worth Sh17.3 million.

He was optimistic that he would be paid promptly especially because the person he was dealing with was a senior ministry official. He got nothing from the contract. The unpaid amount would rise to Sh66 million plus interest.

In his case, he told the court that he received instructions from Dr Muraguri to supply medical equipment to Soweto, Toi, Kianda, Karanja, Gatwekera, Lindi, and Silanga clinics in Kibera, Nairobi County.

The 'Beyond Zero' was an initiative that was championed by former First Lady Margaret Kenyatta, governed by the fundamental belief that 'No woman should die while giving birth'. The initiative was meant to complement the government's effort to eliminate preventable maternal and child deaths, as well as the elimination of mother-to-child transmission of HIV and Syphilis.

The idea of Beyond Zero was conceived in June 2013 as Mrs Kenyatta committed to heightening advocacy efforts aimed at reducing preventable maternal and child deaths.

Otieno, the director of Sunken International Limited, has lost the case where he had sued the Ministry of Health seeking orders to have it pay him the money plus accrued interest.

And not just that, Otieno will incur more losses after High Court judge Chacha Mwita while dismissing his case, also ordered him to pay the Ministry of Health and Attorney General the cost of the suit.

Former Director of Medical Services Nicholas Muraguri at Parliament on August 14, 2019. [File, Standard]

Justice Mwita also warned traders against trusting the government with contracts that are not within the procurement law.

“Parties must be cautious when tempted to enter into contracts with public entities, and ensure any procurement is in conformity with the law, lest they suffer the consequences of being lured to act outside the law,” he said.

Otieno was no stranger to the Ministry of Health. He had won another tender by the same ministry on Beyond Zero Campaign.

He explained that Muraguri called him, requesting that he urgently supplies equipment to be installed in the container clinics as then President Uhuru Kenyatta was about to launch the project at Kibra.

The mobile phone promise, according to Otieno, was that he could get a local purchase order (LPO) for the supply later in the week. This was on June 24, 2014.

Otieno heeded the call and quickly assembled all that was required and delivered the equipment. And instead of the ministry receiving the equipment, the National Youth Service acknowledged that he had delivered his part of the bargain.

Further, the ministry did not issue the LPOs as the official had promised.

He raised invoices worth Sh17.3 million to the then PS but he did not get any response.

Otieno admitted that he had no written contract but maintained that the urgency expressed on the phone had him deliver first and complete the process as he had done earlier.

His employee, Apollo Nyabola, confirmed that all the container clinics were equipped and the list had been supplied by the Ministry of Health.

However, the Health ministry threw Sunken under the bus. It stated that although the firm supplied the equipment, it was not in line with its procurement processes.

According to the ministry, Sunken supplied medical equipment for Beyond Zero Campaign and was paid in full. It asserted that if the ministry required more for the seven, then the same would have been advertised, a tender floated and the winning bidder granted the contract.

It admitted that there were seven clinics that were branded Beyond Zero. However, it asserted that they were owned by the county government.

The ministry’s witness, Martin Sirengo, admitted that instructions could be issued through a phone. He also noted that more equipment was supplied as the initial contract required but maintained that he was not aware that Muraguri had contacted Otieno over the supply of the contested equipment.

He also stated that handing the equipment to NYS was irregular and illegal as the contract required inspection and acceptance by the ministry to ensure compliance with the specifications of the contract.

Justice Mwita agreed with the ministry. He found that Sunken did not produce in court any valid contract.

“I am not satisfied that the plaintiff had a contract and that it supplied the equipment. The evidence fell short of the proof on a balance of probability required in civil proceedings. Consequently, the plaintiff’s suit fails and is dismissed,” said Justice Mwita.