Lawyer seeks to revive Sh76m Mumias legal suit

President William Ruto’s efforts to break the Mumias Sugar Company revival jinx seems to be far from over after a lawyer who had withdrawn two petitions against the sugar firm reversed the decision, claiming coercion.

Jackline Kimeto, who had withdrawn the Sh76 million liquidation petition against Mumias last week, sought the court’s permission to revive the proceedings.

According to her, she made the decision to withdraw the case under threats and intimidation from unnamed individuals who were ready to go to the extent of taking her life. Kimeto filed a fresh notice on Monday seeking to revive her two cases in which she was claiming Sh76 million in legal fees from the troubled miller. In a letter to the Deputy Registrar of the High Court Commercial and Tax Division, Kimeto sought to rescind her decision.

“Kindly take note that the Petitioner (Jackline Kimeto of Kimeto & Associates Advocates) herein wishes to cancel the said notices as the same were obtained from her through extreme duress and threats to her life, citizenship and personal liberty by state officers acting with a view to assisting the KCB bank and the receiver manager of Mumias Sugar company PV Ramana Rao and their proxies in this suit,” reads the letter.

Imprisonment threats

In her latest notice, the lawyer told the High court that she had been subjected to threats of imprisonment, coercion, threats to her life and extreme psychological pressure to withdraw the petitions she filed in court on March 20 and 22,2019.

She says that the forces did not however tell her how her legal debt with the sugar miller would be settled in full.

“The Petitioner is currently being subjected to force, threats of imprisonment, coercion, threats to her life, and extreme psychological pressure to withdraw her Petitions filed with this court on the 20 and 22 of March, 2019 without any mention as to how her money decrees shall be settled in full,” the lawyer asserts.
Kimeto now wants her cases to be mentioned urgently before a duty judge during the current vacation by High Court judges with a view to resolving the impasse.

Kimeto’s law firm is among Mumias Sugar’s creditors, having represented the miller in court cases. It is seeking over Sh76 million from the financially crippled company.

On Friday, September 1, the law firm had filed a notice before the High Court seeking to withdraw the matter, citing “circumstances beyond its control.”

In a subsequent letter to the Deputy Registrar dated September 2, 2023, Kimeto now seeks to cancel the notices of withdrawal.

The lawyer previously expressed fears over the matter. She accused the police of threatening her with arrest if she did not appear before them for questioning and hand in some documents they required.
She claimed to have been summoned by the Directorate of Criminal Investigations (DCI), arguing that the threats were meant to scuttle the proceedings that were pending before various courts.

The see-saw decision in the Mumias saga comes barely a week after President Ruto waded into the revival of the once-mighty sugar miller.

During a tour in Western region last week, Ruto warned some unnamed influential figures within the sugar industry of exploiting cane farmers through protracted legal battles.

The President contended that the long running court cases had impeded necessary reforms within the sugar sector.

President Ruto’s warning against individuals he claimed were cartels controlling the sugar sector, attracted sharp rebuttal from the Law Society of Kenya (LSK) which accused him of trying to interfere with the judiciary and intimidating litigants.

Days after his warning several petitioners including Kimeto, billionaire Jaswant Rai of West Kenya Sugar Company and Dubai-based Vartox Resources Inc filed notices to withdraw pending cases both in the High court and Court of Appeal.

Rai and his firm immediately dropped the several cases against Mumias Sugar in various courts.

Court proceedings

“Take notice that West Sugar and Jaswani Rai wholly discontinue and withdraw their claim in this suit,” reads the notice before the Milimani Commercial Courts.

Rai’s matter before the High Court involves contempt of court proceedings against Sarbjit Singh Rai, Rakesh Kumar and Stephen Kihimba.

The three were guilty of defying court orders to cease operations at Mumias.

They were subsequently fined Sh100,000 each and directed to appear before Justice Alfred Mabeya for sentencing. They have since stopped the sentencing at the appellate court. On its side Vartox Resources Inc also filed a notice to withdraw the cases at the Court of Appeal against Mumias Sugar Company Limited.

In an appeal at the Court of Appeal, Vartox Resources had challenged the 20-year lease awarded to Uganda-based Sarrai Group to manage Mumias Sugar Company.

The Dubai based firm which took over the loans of Victoria Commercial Bank, intended to argue against Sarrai Group’s bid to overturn the nullification of the lease and removal of PVR Rao as Mumias Sugar’s administrator.

The firm is claiming billions from Mumias Sugar, which it inherited from Victoria Commercial Bank. The bank took over the debts from EcoBank and French firm Proparco. The loans were secured using Mumias Sugar’s ethanol and power generation plants.

Vartox had argued that the 20-year lease, which was cancelled by High Court justice Mabeya in April last year, was a calculated move by the KCB appointed receiver manager Rao to deny other bidders a chance to manage the miller.

The company’s director Kristian Khachatourian claimed that the entire evaluation process was a sham.
As the legal landscape shifts and powerful players reconsider their legal strategies, the fate of Mumias Sugar Company remains in the spotlight, along with its implications for the wider sugar industry in Kenya.

Mumias Sugar Factory. PD/file