Judge Saves Tuju In Sh1.6Bn Debt Row

A judge has reversed a decision allowing receiver managers to take over the property of Jubilee Secretary-General Raphael Tuju over a Sh1.6 billion debt.

Justice Mary Kasango on Thursday agreed with Mr Tuju that he was not given a hearing when she allowed two receivers, on March 25, to manage Dari Limited.

Although Muniu Thoithi and George Weru, who had been appointed by East African Development Bank, were yet to access the property in Karen, the Jubilee Party official argued that the order granting them access was made without hearing his side of the story.

The judge reversed her decision and directed the lender to argue the application afresh, with arguments from all parties.

She directed the case to be mentioned on June 15.

In March, the court had directed Mr Tuju and his children to hand to the receivers the company’s statement of affairs, financial returns and company records as well as cashbook from December 29, 2019, to date.

They were also required to hand in management accounts, list of debtors and creditors as of February 4, 2020, and the staff payroll for the last three months.

The bank further wanted Mr Tuju and his co-directors to show cause why they should not be committed to civil jail for six months, for disobeying court orders.

But the Cabinet secretary contested the ruling, arguing that the court granted final orders without hearing his side of the story.

Mr Tuju has fought the takeover bid accusing the bank of frustrating his plan of repaying the debt and to permanently deprive him of the property, yet it was an integral component of his business.

He also argued that the objective of placing Dari Ltd in receivership was to sell it and deprive him of his right to own property.

In another case pending before the High Court, the bank had given Mr Tuju and his children 21 days to pay $16,550,608 (Sh1.618 billion) with interest, failure to which the lender threatened to file bankruptcy suit against them. However, he also rushed to court and blocked the demand.

Mr Tuju faulted the bank saying it was seeking to unfairly and unjustly benefit from an agreement that the bank did not honour as they reneged on essential terms of a project proposal, approved by the board of directors, by failing to disburse all the money as agreed.

The dispute flows from a 2015 deal when Mr Tuju, as a director of the company, entered into an agreement with the regional bank for a loan of $9.3 million to expand his business.-Business Daily.