Macharia moves to block receivership orders

Royal Media Services chairman SK Macharia has moved to forestall a looming bankruptcy by filing an application seeking to set aside a court ruling that ordered his vast estate be placed under receivership.

Through his lawyers Dr Gibson Kamau Kuria and Mr Paul Muite, Mr Macharia on Monday appeared before Mr Justice Muga Apondi and pleaded to be allowed to deposit Sh35 million as security pending the filing of an intended appeal.

The application was filed in the wake of a ruling delivered by Lady Justice Martha Koome, which ordered the assets of Mr Macharia and his wife, Purity Gathoni Githae, be under the watch of a trustee appointed by the government.

In the application, the lawyers asked Mr Justice Apondi to exercise the court’s discretion and put on hold the receivership orders, arguing that the businessman had an arguable case with high chances of success at the Court of Appeal.

Mr Macharia also sought an undertaking to deposit in court Sh35 million, an equivalent of the amount being demanded by a transporter Livingstone Waithaka, who successfully petitioned the court to declare the businessman insolvent. Mr Justice Apondi will decide on the two applications on Tuesday.

Lady Justice Koome issued orders that Mr Macharia’s estate be placed under a government trustee.

The official receiver is required to conduct an inventory of his assets and thereafter invite all the creditors who may have a claim against the couple to join in the proceedings.

In the event that Mr Macharia’s liabilities exceed the assets, then the official receiver will petition the court to declare the couple bankrupt.

Also in the course of receivership, the couple is barred from being directors of any limited company or taking an active role in the control or management of any business.

Any salaries, allowances or emoluments drawn by Mr Macharia and his wife from any limited company they may be holding positions, will be channelled to the official receiver unless the receivership orders are legally discharged.

The media magnate, who owns the Citizen TV and several FM radio stations, was sued together with his wife for failure to pay Mr Waithaka, the managing director of Ocean Freight Transporters Company limited Sh500,000 after a summary judgement by Lady Justice Kalpana Rawal in 2001.

The money attracted a monthly interest of 19 per cent and was backdated to December 1986.

At the time of filling the bankruptcy proceedings two years ago, the debt had reached Sh34.9 million.