Embattled former Central Bank of Kenya Nashon Nyaga leaving Milimani law courts who together with other minority shareholders seeking to reinstate civil suits filed against its directors.
BY SAM ALFAN.
Tatu City and Kofinaf Company limited opposed an application by minority shareholders, seeking to reinstate civil suits filed against its directors.
Senior counsel Ahmednasir Abdullahi, told the court that former Central Bank of Kenya Nashon Nyaga and Industrialist Vimal Shah who are minority shareholders did not seek authority from majority directors to institute proceedings, that have now been terminated by the court.
He said that the two companies could have not sued its directors, saying that its same companies that applied to have suits withdrawn.
Mr Ahmednasir said that upon the suits having been endorsed by deputy registrar has withdrawn the remedy that Nyaga and Vimal had was to appeal against the decision to terminate the proceedings.
The same appeal should have been done within seven days of the decision of the deputy registrar, which was not done
Mr Ahmednasir told the court that there is no prejudice suffered by the minority shareholders by having the applications withdrawn.
He said that the high court has no jurisdiction to entertain the application by the minority shareholders
However, the minority shareholders are at liberty to challenge the decision by international investors of Tatu City Ltd and its main local subsidiary, Kofinaf Ltd, to exclude them from the management and control of the project.
Justice Eric Ogolla had acknowledged that the court’s deputy registrar had approved the October 22 application by Ahmednassir seeking the withdrawal of the two firms from the civil suits that have derailed the development of huge tracts of land in Kiambu County.
The aggrieved local partners, led by former Central Bank of Kenya (CBK) Governor Nahashon Nyagah and industrialist Vimal Shah, have opposed the move by the foreign investors to pull out of the civil suits, on the basis that the four-year legal wrangles cannot be resolved without the participation of the parent companies.
Nyagah and Vimal, who are represented by Richard Otieno Kwach and Nelson Havi, told Justice Charles Kariuki, that the withdraw of the suit was unlawful.
The bone of contention is the September 16 board meeting in which all the directors of the two companies discussed circumstances that have created bad blood amongst them, resulting in the filing of a plethora of cases that have over-shadowed the development of the project.
The foreign shareholders have accused their local partners of attempting to alienate and transfer more than 2,000 acres of land belonging to the companies. But Nyagah and Vimal claim they have been side-stepped in the management and financing of the mega-project and have demanded a forensic audit of accounts.
In a related development, international audit firm, Pricewaterhousecoopers, recently declined an assignment to scrutinize loan facilities advanced to the companies for the purchase of land following the fall-out between the parties.
The Directorate of Criminal Investigations (CID) has been investigating Nyagah over allegations that he used close relatives and cronies to irregularly transfer shares worth Sh 5.3billion in a grand conspiracy to defraud the parent company. The sleuths have recommended the prosecution of Nyagah and five other people.
Nyagah has been granted temporary conservatory orders stopping his arrest pending the outcome of his petition challenging the validity of the investigations.
Justice Kariuki will make a ruling on February 26 as to whether to grant the application by minority shareholders to reinstate the suits.