Billionaire businessman and Equity Bank #ticker:EQTY founder Peter Munga has failed in his bid to stop a multi-million shilling demand over a botched share sale deal.
In a High Court ruling, Justice Mary Kasango dismissed Mr Munga’s plea seeking to strike out the case filed by his friend-turned-adversary, Joseph Kamau, who is seeking Sh150 million compensation from the tycoon.
Although the judge agreed that Mr Kamau had taken long to file an affidavit detailing whether the directors of Bethany Vineyards Ltd granted him the authority to file the case, she said Mr Munga had suffered no prejudice from the delay.
“The affidavit was filed six months later. No explanation was given by the plaintiffs why they delayed in filing the affidavit. Notwithstanding that delay, there is in my view, no prejudice suffered by the 3rd defendant due to that delay,” said Justice Kasango said.
Mr Munga, the former Equity Group chairman, wanted the case dismissed, arguing that there was no resolution from the board of directors of Bethany authorising Mr Kamau to file the claim against him.
Further, he said, other than lacking authority, the case had failed because Mr Kamau did not file the affidavit within seven days as directed by Justice Fred Ochieng in November 2017.
In reply, Mr Kamau said the directors who sanctioned the filing of the case were legitimate and had also allowed him to swear the affidavit outlining the same.
Justice Kasango said there is no requirement for a company to present a resolution indicating that it had authorised the filing of a suit or an affidavit on its behalf.
She allowed the affidavit, but directed the company to pay Mr Munga the costs for late submission.
In the matter, Bethany Vineyards and Mr Kamau had claimed that Mr Munga has since 2011 refused to pay for three million TransCentury Limited #ticker:TCL shares worth Sh150 million that he purchased from the company.
Mr Kamau had sold the shares to Mr Munga in 2011 at Sh50 each after failing to settle a Sh40 million loan he had taken from Equity Bank. In the deal, Mr Munga was supposed to clear Mr Kamau’s loan and remit the balance to him and his company.
Mr Munga had earlier offered to settle the dispute out of court and proposed to pay Mr Kamau Sh90 million. However, Mr Kamau rejected the offer, prompting the suit’s return to court.