Twiga Chemicals spared auction over Sh70 million debt

A court has temporarily barred a Nairobi-based law firm from attaching or auctioning assets of Twiga Chemical Industries Limited because of a disputed debt of Sh70 million for legal services offered more than 10 years ago.

The court of appeal stopped Gichuki King’ara & Co. Advocates from demanding the money, following a finding that the farm products manufacturer has an arguable appeal against the said legal fees.

While allowing an application by the manufacturer to temporarily bar the law firm, the court said the company had demonstrated that should the intended appeal be successful, there is no guarantee that it will be compensated in damages. Further, it would be a financial burden for the company to recover the money.

This is because the company’s assets were likely to be attached and auctioned by the law firm in a bid to recover the money, hence the loss will be irreparable.

“The applicant (Twiga Chemicals) has demonstrated an arguable appeal, which will be rendered nugatory should stay of execution not be granted,” said the three-judge bench comprising Justices Asike Makhandia, Kathurima M’inoti and Fatuma Sichale.

In its application, the company through its director, Hezekiah Mwangi Macharia, indicated that it had instructed the law firm sometime in 2006 to act for them in a court case involving a 507-hectare land.

However, their relationship deteriorated and the law firm, which is owned by lawyer Peter King’ara, ceased to act for the company before the determination of the said suit.

Mr Macharia said on September 1, 2017, the law firm filed an advocate-client bill of costs seeking Sh77 million in legal fees with Sh28.9 as instruction fees. The amount was founded on a speculative figure of Sh1.5 billion as being the value of the land.

However, the court Deputy Registrar taxed the advocate-client bill of costs at Sh5.3 million. But both parties were aggrieved by the decision and sought to have it reviewed at the Environment and Land Court.