WIN FOR ABSA AS COURT UPHOLDS FREEZING OF 98 VEHI3ALSO SOUGHT BY WATER AGENCY.

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BY SAM ALFAN.

Absa Kenya will keep nearly 100 vehicles purchased by Italian firm CMC Di Ravenna for the use in the construction of controversial Itare Dam in Nakuru county.

This is after Justice Francis Tuiyott gave the bank green-light to continue keeping the vehicle purchased by CMC Di Ravenna.

Justice Tuiyott dismissed a plea by a state corporation to overturn a consent filed in court in 2019, freezing the vehicles pending hearing and determination of a case filed by Absa.

The lender seeks to auction the cars to recover a loan of Sh585 million advanced to CMC Di Ravenna in 2017.

Court dismissed application seeking to enjoin Rift Valley Water Services Board (RVWSB) in the case saying he was not persuaded that the case cannot be resolved with or without the board’s participation.

The judge said the ownership of the vehicles was to vest in RVWSB only upon completion of the project, which is yet to happen.

“On the material before Court, and without further evidence or full argument, I am unable to say that the claim of breach of contract by RVWSB will prevail yet I cannot say it is trivial,” he said.

Justice Tuiyott said while the RVWSB may have an arguable case against CMC for breach of contract, it failed to demonstrate an arguable case that may surmount Absa’s interest.

“The Bank, as Plaintiff, is the owner of these proceedings, and pursuit of its claim against CMC should not be detracted by the claim by RVWSB which can be pressed in separate proceedings,” Justice Tuiyott said.

RVWSB had sought to join a case arguing that 17 of the vehicles belong to the board.
The board further said that a consent filed in court in 2029, freezing the vehicles was procured by way of fraud or mistake, and ought to be set aside.

The Board said it contracted the Italian Company to construct the dam in Kuresoi-Molo, in Nakuru County.

Documents filed in court state that it was agreed that they would purchase the 17 vehicles and spent Sh82.5 million.

The vehicles would be registered in the name of the Italian company but would be returned to the Board, once the project is completed.

The Board maintained that the vehicles do not belong to CMC Di Ravenna. Further, th board said the Italian company used the motor vehicles to secure a financing agreement with Absa in May 23, 2017, without their consent or knowledge.

On its part, Absa said the Italian company approached them in 2017 and 2018 for various financial facilities.

The facilities included Asset Financing, multi-option facilities (short-term loan/overdrafts) and working capital and bank guarantees.

The Bank said it loaned CMC di Ravenna Sh585 million for the purchase of 98 vehicles and equipment to be used in the dams project.

Directorate of Criminal Investigations had also targeted the vehicles but Absa objected saying the DCI was confusing Kimwarer dams in Elgeyo Marwakwet County and Itare dam.

Documents filed in court by DCI indicated that Sh160 million of the dams’ project money was paid to Toyota Kenya for 45 vehicles ranging from Prados, Fortuners, Corollas, Hiace vans and pick-up trucks.

But only 17 of the vehicles were registered to Italian firm CMC di Ravenna, the bankrupt Italian firm hired to construct the dams. 

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