Chinese firm sues lawyer after botched land deal

Chinese conglomerate China Wu Yi (Kenya) Company Ltd has sued a Mombasa-based lawyer seeking to have him return Sh20 million paid to him to enable it acquire a parcel of land worth Sh1.2 billion in Mombasa County.

It is also seeking to have Mr Stephens Kithi refund Sh5.8 million in legal fees incurred by the company on the aborted sale.

The company claims that on or about July 30, 2016 it entered into a sale agreement with Mr Kithi in his capacity as a beneficial owner of the land having obtained authority on behalf of the registered owner.

According to the company, after execution of the variation, it proceeded to pay the lawyer Sh121 million being 10 percent of the purchase price into an interest earning bank account held jointly by lawyers for both parties.

“On April 11 2017, at the defendant’s request, the plaintiff through its advocates released Sh20 million out of the deposit paid to be utilized for the purpose of vacant possession,” part of the suit documents state.

China Wu Yi further says that it reminded Mr Kithi by way of letters that it was ready to complete the transaction.

“Instead, the defendant introduced a third party by the name of Propken (Mauritius) Ltd who purportedly had the transferees’ rights to the property,” argues China Wu Yi.

According to the plaintiff, the defendant was fraudulent and misrepresented facts which if they were disclosed at the time of entering into the agreement, the firm would have opted out.

The company says that on revocation of the deal, it pursued a refund of the deposit by writing a letter to the bank advising of the cancellation of the transaction, requesting the joint account be closed and a transfer of all proceeds to the company’s account.

The firm says that after the proceeds of the joint account were released to it, it continued to pursue the Sh20 million advance payment paid to Mr Kithi to facilitate vacant possession.

“To date, the defendant has not refunded the amount despite the agreement requiring a refund of all sums paid to the vendor immediately on lapse of the completion notice.”

The company is also seeking for general damages for breach of contract, loss of investment opportunity and time expended on the transaction.