Economy

Court rejects arbitration for Sh29m varsity debt dispute

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The High Court has rejected a plea to refer a Sh29 million debt dispute between a private architect and the Multimedia University of Kenya for arbitration.

The architect, Charles Migichi Mungai practising as Clarion Architects, was pushing for arbitration in the dispute which involves unpaid professional fees amounting to Sh29,224,634, arguing there was little progress.

The dispute started in 2010 after the university terminated his contract for architectural consultancy services. He had been contracted on a pre-qualified basis in relation to the renovation of various buildings and structures at its Mbagathi campus.

In his request, Mr Mingai wanted the court to order the chairperson of the Architectural Association of Kenya to nominate an arbitrator within 14 days of the order.

Additionally, he wanted the arbitrator ordered to resolve the dispute and prepare and submit the award to the court within six months from the date of appointment.

But David Majanja dismissed the request last Friday saying arbitration is a consensual process governed by consent of the parties.

He said the university cannot be forced to proceed to arbitration yet it never expressly agreed to do so, according to correspondences on record.

"From the material on record, I find and hold that the architect unilaterally introduced the reference to the Architects and Quantity Surveyors Act but this was not accepted by the university hence the arbitration provisions were not incorporated into the agreement between the parties," said the judge.

In urging the court to allow the arbitration, Mr Mungai argued that despite numerous requests, the University has not settled his fees.

His lawyers issued a formal demand letter dated December 20, 2018 and the university replied to it by another dated January 23, 2019, seeking more time to resolve the matter as it was in consultations with the Ministry of Education.

Due to lack of progress on the matter, his lawyers wrote to the school invoking the provisions of the Architects and Quantity Surveyors Act and requesting the school to concur to the appointment of an arbitrator whom Mr Mungai had proposed.

He told court that the university neither agreed nor objected to his choice of proposed arbitrator.