Former Cabinet Secretary (CS) Raphael Tuju has failed in an attempt to reopen a long-running battle with a regional bank, over a contested debt of Sh4.5 billion loan.
The High Court dismissed the fresh application by Mr Tuju and his company Dari Ltd, saying the issues raised by the former CS had been addressed in previous court decisions.
Mr Tuju had asked the High Court to review its January 2020 decision that recognised a judgment issued in London in favour of the East African Development Bank (EADB).
The London judgment compelled Mr Tuju and his companies to repay a loan borrowed from EADB in 2015, which has since grown to more than Sh4.5 billion and triggered auction of some of Mr Tuju properties.
The formeer CS argued that he had discovered new and important evidence supporting his case that warrants a review of the judgment.
“The matter has been finally decided by a court of competent jurisdiction. This court will not permit a collateral attack on a final and valid foreign judgment already recognised by this court and the appellate court,” said the court.
Mr Tuju told court that the new evidence emerged from a cross-examination of a key witness, David Odongo, who testified on behalf of the bank, allegedly confirming that the loan borrowed in 2015 was two-phased.
Mr Tuju further said Mr Odongo recanted key parts of his earlier sworn affidavits that were used to obtain the UK judgment and its registration in Kenya.
He said the witness also admitted that the loan agreement was part of a two -phase project, land acquisition and constructions of villas, but that the facility agreement only reflected the first phase.
The court, however, said the issue of two-phased project had been litigated to its conclusion before the English courts. The court also said it would be legally improper for the High Court to make a determination on an issue that is pending before the Supreme Court.
The former CS has been battling with the regional bank over a disputed debt, arising from a loan borrowed by in 2015.
Mr Tuju’s firms Dari Ltd and SAM Company Ltd entered into a facility agreement with the lender for a loan of $9.3 million in 2015 to expand his business. The loan was secured by several forms of collateral, including an indemnity and guarantee agreement on April 10, 2015.
Mr Tuju’s two properties Entim Sidai alongside Tamarind Karen and Dari Business Park, were charged as security for the loan.
The former CS accused the bank of failing to disburse the full amount thereby causing cash flow difficulties for the principal debtor.
When Dari Ltd failed to service the loan, the bank issued a demand for the immediate repayment and soon filed a suit in the United Kingdom against the company and the guarantors —Mr Tuju, his children and SAM Company Limited.
In a judgment on June 19, 2019, Judge Daniel Toledano of the High Court of Justice Business and Property Courts of England and Wales, entered summary judgment against Dari and guarantors, jointly and severally, for $15,162,320.95.
To enforce the decision, the bank moved to the High Court for recognition of the judgment. The decision was adopted on January 7, 2020 as provided under the Foreign Judgment (Reciprocal Enforcement) Act.
Dari Ltd filed an application before the High Court, for setting aside the UK judgment but it was rejected and the matter escalated to the Supreme Court, where it is pending after the judges disqualified themselves from the case.
One of the properties, Dari Coffee and Garden Restaurant was allegedly auctioned in October for Sh450 million, but Mr Tuju contested the sale.
The planned sale of a second property, Entim Sidai Wellness Sanctuary and Tamarind Karen and Dari Business park, was stopped by the court after Mr Tuju contested the valuation tabled by Knight Frank Valuers, which was appointed to value the properties.
