Kenyans will be forced to bear a cost of Ksh1.3 billion after the High Court sitting in Nairobi failed to suspend a request by the Kenya National Highways Authority (KeNHA) to suspend payments to an Israeli firm.
The High Court declined a request by KeNHA to suspend proceedings of five cases filed by the Israeli contractor seeking to be paid the said amount after the termination of road construction contracts.
Justice John Mativo rejected the request, adding that KeNHA did not prove that it has a plausible defence.
He stressed that the decision of the Dispute Adjudication Board (DB) of July 10, 2020, instructing KeNHA to pay the contractor the Ksh1.3 billion is binding.
"To the extent that these proceedings seek to enforce the DB decision, this court cannot intervene except in situations contemplated by Section 10 of the (Arbitration) Act," ruled the Judge.
The cases were lodged by the Israel contractor, SBI International Holdings AG (Kenya), seeking enforcement of an arbitration award made by the Dispute Adjudication Board (DB) in relation to various contracts including the one for dualing of Kisumu Boys Roundabout – Mamboleo Junction.
The Judge noted that the dispute was related to a contract with an arbitration clause.
According to the Judge, the decisions of the DB have never been set aside, either by amicable settlement or arbitration, so the decisions are enforceable and contractually binding upon KeNHA.
KeNHA through its chief legal officer, Nathaniel Chisenga Munga, said the money will be paid from taxpayers' coffers and that the omission to file the defence was not due to negligence.
The Israel contractor abandoned works on the 8km dual carriage from Kisumu Boys’ Roundabout to Mamboleo Junction last December over alleged accrued arrears.
The contractor had already given KeNHA a 14-day notice to pay the pending bills or they withdraw from the contract altogether.
The road from Kisumu Boys Roundabout to Mamboleo Junction was being jointly financed by the World Bank and Kenya Government at a cost of Ksh2.6 billion.
Apart from the Kisumu Boys’ - Mamboleo junction interchange, the contractor had two other contracts with KeNHA, including the Ahero and Kericho interchanges.
