In Summary
  • A ruling in the case shows that after a protracted legal battle in which the government refused to pay Universal Satspace LLC of America, a London court in February 2003 ordered for mediation between the parties.
  • Instead, the court said, at the request of the Kenya Government, there was to be a 21-day delay in signing and the parties promised to sign the agreement within that period.
  • In the case involving First Mercantile Securities Corporation, the court ordered the government to pay the Swiss firm $2.5 million plus 8.75 per cent interest and the cost of the suit.

The government lost a case against one of the Anglo Leasing firms because it failed to honour a court agreement to settle the matter.

A ruling in the case shows that after a protracted legal battle in which the government refused to pay Universal Satspace LLC of America, a London court in February 2003 ordered for mediation between the parties.

The court says the mediation was successful because the parties reached an agreement to settle the matter.

“Usually at mediation, the terms of the agreement are written down and signed by the parties, but in this case, and unusually, the agreement between the parties was not signed,” the court observed.

Instead, the court said, at the request of the Kenya Government, there was to be a 21-day delay in signing and the parties promised to sign the agreement within that period.

“However, although the claimants promptly drew up the agreement and signed it, the government did not to do so,” the court said.
It says it is under these circumstances that the application to strike out the government defence had been brought to court.

“The court may strike out a statement of case if it appears to the court that the statement of case is an abuse of the court process, or is otherwise likely to obstruct the just disposal of the proceedings or there has been a failure to comply with the rule, practice direction or court order,” the court observed.

Consequently, it dismissed the government defence and ordered it to pay Universal Satspace LLC $7.6 million being the principal sum being claimed plus $274,431 interest on that sum up to December 20, 2013.

The money was to be paid by January 17, 2014.

In the case involving First Mercantile Securities Corporation, the court ordered the government to pay the Swiss firm $2.5 million plus 8.75 per cent interest and the cost of the suit.

Before this, the government had refused to pay the firm, claiming that those who had signed the contract in dispute did not have authority to act on its behalf, that the contract was signed as a result of bribery to the signatories and there was alleged fraudulent misrepresentation.

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