Politics and policy
Photo/File
Members of Public outside the Social Security House building that houses
NSSF. Sololo Outlets is seeking to compel NSSF to honour a pledge
purportedly made by a former managing trustee in a fresh suit that could
see it (NSSF) lose Sh1.5 billion.
By MOSES MICHIRA
The National Social Security Fund (NSSF) could lose
another Sh1.5 billion in a fresh suit where Sololo Outlets is seeking to
compel it to honour a pledge purportedly made by ..........................
a former managing trustee.
a former managing trustee.
The firm, owned by Lugari MP Cyrus Jirongo, claims that Alex
Kazongo promised to pay the amount as part of the deal to review its
claim from Sh1.39 billion to Sh490 million in a recent arbitration.
NSSF has settled the Sh490 million awarded to
Sololo, indicating that the total payout could top Sh2.9 billion should
the court grant the company’s plea, leaving the State pension manager
exposed.
“Sololo Outlets has returned to court under a
certificate of urgency to claim a further payment of Sh1.52 billion
allegedly based on a promise by the former managing trustee to review
the claim of Sh490 million,” the NSSF acting managing trustee Tom Odongo
told Parliament’s Public Investments Committee.
He, however, said there was no written agreement between Mr Kazongo –sacked in February – and Sololo Outlets.
The committee was informed that the board of
trustees was not aware of the new contract, but NSSF may now have to
bear full liability.
Legal experts point out that Sololo does not need
to have a written contract to present a strong case in court, citing
that implied agreements can be valid and enforceable.
“A contract can be implied depending on the
circumstantial relationship between the parties,” said Ashford Mugwuku, a
Nairobi-based commercial lawyer, alluding to the fact that Sololo
Outlets could have a case.
Earlier, the fund had paid Sh342 million toUganda’s
Mugoya Construction Company for breaching a contract entered between
the two parties for the development of an up-market housing estate in
Karen, which did not take off.
The claim by Sololo Outlets relates to a contract
entered in 1992 where NSSF purchased an incomplete housing project in
Nairobi’s South B estate consisting 420 homes, a school and a shopping
centre from the developer for Sh1.2 billion- where the selling price
included the cost of completing the works.
The seller raised the price to Sh2.65 billion in
May 1993 citing a jump in material costs, prompting NSSF to terminate
the contract after Sh900 million had been paid, bringing the total
payout to Sh1.39 billion.
NSSF hired a different contractor to finish the
works and the homes have since been sold out to individuals under a
tenant purchase scheme.
Last week, Mr Jirongo wrote to NSSF seeking to
repossess Hazina Estate in exchange for the Sh1.39 billion paid to his
company to date—a position Adan Mohammed, the chairman of the board of
trustees, says is not enforceable.
No comments :
Post a Comment