Relief for Jirongo as order to pay Sh700m debt reversed

High Court has reversed an earlier order for embattled politician Cyrus Jirongo to pay a debt of Sh700 million to a businessman, removing the risk of declaring the former Lugari MP bankrupt again.

High Court Judge Olga Sewe set aside the judgment issued on July 2014 ordering Mr Jirongo to clear the debt owed to Sammy Boit Arap Kogo. This saw him declared bankrupt.

The National Bank #ticker:NBK auctioned properties registered under the name of eight companies belonging to Mr Kogo after Mr Jirongo allegedly failed to pay Sh700 million bank loan advanced to him with the properties used as security.

Mr Jirongo had petitioned the court to drop the judgment, arguing he was not given a chance to defend himself and that he learnt of the court action through the press. “That the default judgment entered herein against the 2nd defendant on July 28, 2014 is hereby set aside, thereby giving the 1st defendant leave to defend this suit,” ordered Justice Sewe in a judgment delivered on her behalf by Justice Maureen Odero.

Mr Jirongo told court that the notice of entry of the judgment was not served on him and that the law firm of Rachier and Amollo advocates that extracted decree and warrant of arrest against him acted unlawfully since they are not on record for Mr Kogo in the case.

He disowned the agreement he allegedly entered with Mr Kogo undertaking to settle the money, saying that his signatures were forged.

Mr Jirongo argues that he ceased to be a director of Bethlehem Trading Company, which is also listed as defendants, in 1994 long before it entered into any agreement with Mr Kogo, and cannot therefore be held responsible for its liabilities.

Mr Jiongo says he has never borrowed any money or sought security from the properties owned by Mr Kogo’s firms.