advertisement

Economy

Munga fights to stop former partner’s debt suit

Equity Bank board chairman Peter Munga at a past event. FILE PHOTO | NMG
Equity Bank board chairman Peter Munga at a past event. FILE PHOTO | NMG 

Businessman Peter Munga wants the court to stop a suit in which he is accused of irregularly selling his estranged associate’s shares worth Sh150 million and failing to remit the proceeds of the sale to the rightful owner.

The businessman, who chairs Equity Bank board, wants the suit terminated on grounds that his accuser did not get the support of company directors and therefore lacks authority to sue him.

Mr Munga claims that Joseph Muturi Kamau, who took him to court for failing to remit proceeds of the shares sale, single- handedly resolved to sue him on behalf of a company that is jointly owned with others, including his (Munga’s) son Kieme.

The businessman in a sworn affidavit filed in court wants the suit struck out, on grounds that both Mr Kamau and George Mburu were not authorised by the company (Bethany Vineyards Limited) to swear affidavits on its behalf.

“There is no resolution or valid resolution of the Plaintiff Company either approving the institution of this suit on its behalf or appointing the law firm of Aming’a Opiyo Masese and Company Advocates to institute this suit for and or on behalf of the plaintiff company,” Mr Munga said in the Notice of Motion Application dated 24th February 2017.

Kieme Munga, Mr Kamau and Mr Mburu are directors of Bethany – the company that has accused Mr Munga of illegally selling their shares in 2011.

The case dates back to September 2010 when the jointly owned firm secured a Sh40 million loan from Equity Bank to be settled using proceeds of the sale of the NSE-listed Investment Company TransCentury shares belonging to Mr Kamau, who used them as a guarantee.

Mr Kamau later agreed with Mr Munga to have his three million shares sold at Sh150 million to settle the loan and the balance credited to the company account.

But Mr Munga, who chairs Equity Bank board, failed to execute the matter as agreed despite several demands that he does so. Mr Kamau then sued Mr Munga alongside Equity Bank and Equity Nominees Limited.

Mr Kamau has responded to Mr Munga’s submissions arguing that they smacks of an intention to frustrate the six year-old suit by introducing the technicalities. He maintains that the board, including Munga’s son, verbally resolved to file the suit.

Mr Kamau, who describes himself as a long-time friend of the Equity Bank chairman, says the new application was meant to delay hearing of the suit on March 27, 2017.

He said Mr Munga had verbally assured him that the case ‘‘will never reach the hearing stage.’’

“There is mischief because this application is being brought late in the day to circumvent the March 27, 2017 trial after parties have been subjected to a rigorous pre-trial conference, which the applicant participated in, but failed to raise any issues of compliance or ratification that would have been thrashed out at that stage before an order was made that the suit was ready for hearing,” Mr Muturi said.

He claimed that Mr Munga’s son and Mr Mburu, who together with him make up the directorship of Bethany, have all grown cold feet, leaving him to act alone.

While Mr Mburu left the company after receiving 20 titles for pieces of land in Ngong’, the younger Munga ‘‘went cold and changed his interest’’ leaving him to pursue the debt alone.

Equity Bank, which tried to be delinked from the case in 2014, is accused of settling the outstanding loan balance, but failing to remit the balance to Mr Kamau.

Mr Kamau wants the bank compelled to pay him the Sh150 million for the shares, with interest from 2011.

advertisement