Mr Mukesh Ambani. A Nairobi law firm is suing Delta Resources, which was majority owned by the tycoon’s conglomerate, Reliance Industries, for breach of contract. AFP
What you need to know:
Lawyers are seeking Sh55.3 million as compensation for loss of business and legal costs incurred defending criminal charges in court together with interest.
The land deal saw the anti-corruption agency institute charges against a judge and three others in court.
A top Nairobi law firm has filed a claim against a company associated with Indian tycoon Mukesh Ambani related to the failed attempt to buy a prime plot of land along Kenyatta Avenue owned by the NSSF.
Muriu Muigai and Co. Advocates wants compensation from Delta Resources Ltd, arguing that it reneged on its commitment to protect the law firm from any liabilities arising from the botched Sh1.3 billion NSSF lands deal, and instead allegedly abandoned the company when the deal went sour.
Lawyers Edward Muriu Kamau, Njoroge Muigai, Peter Murage and Esther Omulele and the law firm of Muriu, Muigai and Co. Advocates have filed the claim against Delta Resources, which was majority owned by Mr Ambani’s conglomerate Reliance Industries.
The lawyers are seeking Sh55.3 million as compensation for loss of business and legal costs incurred defending criminal charges in court together with interest. They are also seeking damages for breach of contract.
The firm sought “a declaration that the plaintiffs are entitled to be indemnified by the defendant for all losses and damages incurred by themselves and by the law firm Muriu, Muigai and Co Advocates from consequential actions and acts arising from…handling of the transaction for purchase of the properties,” reads the application.
The land deal saw the anti-corruption agency institute charges against a judge and three others in court.
Edward Muriu Kamau, a lawyer and then managing partner of the firm, was arrested and charged for allegedly defrauding NSSF by making an offer for the purchase of five plots adjacent to the Laico Regency Hotel on July 7, 2008 on behalf of Delta Resources Ltd at Sh1.3 billion.
Delta Resources Limited later changed its name to Delta Corp East Africa Limited in June, 2008.
The company bought land and developed multi-billion- shilling residential and commercial buildings.
The managing partner of Muriu Muigai and Co. Advocates was accused jointly with Justice Juma Chitembwe, former NSSF Managing Trustee Rachel Lumbasyo and a lawyer, Stephen Kipkenda, of conspiring to defraud the workers’ retirement fund through sale of the plots.
The advocates claim the arrest and prosecution of Mr Kamau was highly publicised in the media and that he and the entire law firm of Muriu, Muigai and Co Advocates suffered ridicule, losses and damages and substantial y business losses.
They claim that they consequently lost most of their clients, including banks and other big corporates and individuals due to the link with the alleged corruption.
“The defendant (Delta Resources) breached its undertaking and duty and failed to perform its obligation under the said indemnity. The plaintiffs claims damages,” say the petitioners.
Mr Kamau claims his firm took over to complete the process of the purchase of the prime land on Kenyatta Avenue in September 2007 from another local law firm.
The law firm, says Kamau, executed sale agreement with NSSF for a consideration of Sh1.375 billion but the deal soon ran into problems allegedly after the NSSF failed to obtain endorsement on the titles, extending the period for development of the properties.
He says the deal ran into further hurdles when NSSF rejected their proposal to reduce the sale amount after it emerged the land was smaller than what had been presented.
Dispute was declared in April 2008 and subsequently following the law firm’s request, the Law Society of Kenya appointed Dan Ameyo as the arbitrator.
NSSF moved to the High Court challenging the arbitration and the entire transaction. The suit has since been settled out of court with the land reverting back to NSSF.
