County executives and assemblies have raked up more than Sh21 billion in suspicious legal fees, mainly paid to private lawyers and law firms, a new audit has revealed, with Nairobi accounting for the bulk of the expenses.
The report by Auditor-General Nancy Gathungu said most of the costs arose from court cases related to unpaid contractor claims, wrongful sacking and irregular purchase practices.
Nairobi County topped the list in the payment of questionable legal fees and hiring of external lawyers instead of using internal legal counsels.
The audit report said it has accumulated legal fee dues amounting to Sh21.37 billion, with Sh483.83 million paid in the last financial year alone.
However, the audit found that fee notes submitted by advocates lacked necessary documentation, including service details and justification of charges as per the Advocates Remuneration Order. The payments also lack contracts between county executives and law firms.
“The advocates were appointed directly from a list of prequalified legal firms without subjecting the process to a mini competition,” Ms Gathungu pointed out in her report. A review of legal cases provided for audit revealed that the Johnson Sakaja-led administration had a total of 159 court cases as of June 30, 2024.
However, verification of the cases indicated that out of the suits, 65 were assigned to just eight advocates.
“In a particularly appalling case, a county lost a compensation case where it was required to pay Sh1.03 million in damages but ended up spending Sh4.33 million in legal fees alone,” the auditor-General said.
Mombasa county executive was also flagged for approving a legal expense of Sh93.6 million, including Sh46 million paid to external lawyers without supporting documentation.
In one case, the report noted, Sh3 million was paid as part of decretal fees without evidence of a court ruling, while Sh14.2 million was disbursed for an "outstanding decretal debt" with no supporting documents.
On the other hand, Kajiado County witnessed unjustified legal fees of Sh79.1 million without evidence of an evaluation process to ensure fair pricing.
Additionally, the county paid Sh10 million and Sh30 million for legal battles where it was merely an interested party, rather than the primary litigant.
Homa Bay and Nyamira counties also spent Sh53.7 million and Sh4.6 million respectively without clear justification. Out of the total amount, Sh11 million was noted to have been paid to law firms by Homa Bay County without clear justification.
In Trans Nzoia, the County Attorney was accused of engaging in direct tendering and only using seven out of 36 prequalified law firms to handle 24 cases.
The scrutiny on county assemblies also indicated that Nyamira residents shouldered the highest financial burden after the assembly leadership paid a whooping Sh27.9 million to private legal consultants.
Vihiga County Assembly was also implicated in dubious legal spending that cost the taxpayers Sh31.6 million in an arbitration dispute on the proposed design and architectural works at the assembly headquarters.
Homa Bay and Migori County assemblies on the other hand spent Sh10 million each in avoidable legal fees which was awarded in damages to the speakers, who successfully challenged their illegal impeachment.
“The audit report noted that had the Assembly adhered to standing orders, the court case and the subsequent financial burden would have been avoided,” said the audit report.
Other assemblies mentioned in the irregular legal payments included Narok (Sh5.2 million), and Meru (Sh3 million).
