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Naivas elder brother to pay Sh8m or face auction

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Owners of Naivas are embroiled in a legal battle with their elder brother sparked by failed bid by Massmart to buy a stake in the supermarket chain. PHOTO | FILE

The elder brother of the wrangling Naivas Supermarkets siblings has been ordered to deposit Sh8.1 million in an interest earning account as a pre-condition for being allowed to appeal against the imminent auction of his business.

Newton Nyoro Mukuha is facing the auction of his Greenmart Stores after losing a court battle with his siblings, who are seeking to recover a loan which he has defaulted on.

“The sum of Sh8,105,368 is to be deposited by Greenmart Stores Ltd into a joint interest earning account in the names of the advocates for the decree-holder (Naivas Ltd) and the objector (Greenmart Stores Ltd),” said High Court judge Fred Ochieng in a ruling.

He further directed that the deposit is to be made by next Tuesday and in default of compliance, “execution.”

Mr Justice Ochieng stopped the Naivas siblings from proceeding with the auction of their elder brother’s business to enable the hearing of his application to move to the Court of Appeal.

The judge had in a ruling delivered on November 17 allowed Naivas to auction goods owned by Greenmart at Kayole Estate in Nairobi to recover the Sh8 million debt which Mr Mukuha had admitted to owing his brothers.

READ: Naivas siblings get court orders to sell big brother’s shop

The court said there was a need to lift the corporate veil of Greenmart to avoid defeat of justice by Mr Mukuha, who had contested that the business was a separate entity from him.

“The court declines the invitation by Greenmart Stores Ltd. Instead, I find and hold that if the court stopped the process of execution, that would be tantamount to assisting Mr Nyoro to run away from his legal obligations, I refuse to do so,” Mr Justice Ochieng said in his ruling.

Greenmart claims there were alternatives open for execution against Mr Mukuha instead of attaching the properties of a firm owned by other shareholders.  

In the dispute, Naivas general manager Francis Maswili had told the court that on various dates between December 2008 and December 15, 2009, Naivas supplied Mr Mukuha trading as Greenmart Stores, goods for sale at his supermarket worth Sh46,361,264.65.

“Mr Nyoro, however, paid only Sh34,258,346.44 for the goods supplied and left a balance of Sh12,102,918.21 which  he has refused to pay despite various requests from Naivas,” he explained.

Mr Nyoro in response said that the correct quotation of the first payment to Naivas for the goods was Sh38,258,346.44 and the balance, therefore, is therefore Sh8,102,918.21.