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Businessman in court over breach of trust claims

Wananchi Farm Machinery and Accessories Limited Director Idha Mbarak Ali before Mombasa Chief Magistrate Alex Thuku.Ali together with his brother Twaha Mbarak who is on hiding outside the country were charged with defrauding a Turkish Businessman Ramazan Cetin.

A Turkish Businessman has sued his Kenyan partners who he claims owes him over 34 million shillings including accrued interest for breach of investment agreement.

Ramazan Cetin says he had advanced over 50 million shillings (400,00 Euros) in unsecured investment for importation of machineries.

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Cetin (Plaintiff) had entered into a commercial investment agreement with Wananchi Farm Machinery and Accessories Limited (Defendants) and they were to import agricultural machinery, tractors, tire wheels, automotive spare parts and all kinds of food and textile products to Kenya.

According to Cetin, the profit accrued from the investment was to be shared at a rate of 40 to 60 percent between themselves.

“The commercial agreement executed by the parties also provided that the defendant was to share the account with the plaintiff which included the goods purchased, selling price, mode of sale and monies received monthly,” claims Cetin.

In November 21, 2023 Idha Mbarak was arraigned before Chief Magistrate Alex Thuku and charged with defrauding Cetin.

Mbarak denied the charges and was released on a cash bail of 100,000 shillings.

It is alleged that Mbarak convinced Cetin to accept three logbooks of motor vehicle trucks registration Numbers KTCC 554C, KTCB 773W, and KTCC 554C as valuable securities to a credit facility agreement between Mwananchi farm Machinery and Cetin.

According to a police investigation report, Mbarak and his brother who is currently in hiding convinced Cetin to grant a credit facility of 400,000 Euros and deposited 35 logbooks of motor vehicle trucks as security.

The two defaulted in paying the credit facility and also transferred the motor vehicle trucks to another party.

Cetin said that vide an acknowledgement note dated March 4 2021, the defendant acknowledged receipt of the unsecured sum of 400,000 Euros from him.

He said that the defendant in breach of the agreement failed to share the requisite accounts with him and the profits earned as agreed.

He said the defendant has on several occasions varied the contractual terms of the initial commercial investment agreement that was executed in April 2021 to suit its own whims by preparing other agreements whose terms breached the agreement to his detriment.

Cetin said vide a credit facility agreement dated July 19, 2021 that was executed between the parties that it was agreed that the outstanding balance totalling to 306,190 Euros be converted into a credit facility which was secured by logbooks of 35 tractors that were in the defendant’s possession and up for sale.

He said the 35 log books were handed over to Mohamed Batheif who was a neutral party as security.

“It was expressly agreed between the me and defendant that the proceeds made out of the sale of the tractors were to be handed over directly to Batheif who would surrender the logbooks to be transferred to the successful purchaser and the proceeds in turn be handed to me towards settlement of the credit facility,” said Cetin.

He said the defendant, in breach of the credit facility agreement dated July 4 2021, sold and fraudulently transferred some of the logbooks of the tractors to purchasers without involving Batheif and as such, failed to remit the proceeds received from the sale of the said tractors to him.

Cetin said as a result of the breach, he continued to suffer loss as he had not recovered his investment.

However, in their defense, Wananchi Farm Machinery and Accessories Limited denied the allegations and said that Cetin owes them 14,878,535 shillings despite having paid him.

Wananchi Director Idha Ali said that Cetin failed to forward the tractors into the country.

“To the contrary, Company known as Meisa forwarded to Wanamchi Farm Machinery and Accessories Limited three containers containing completely knocked down kits (parts) and not tractors as envisaged,” said Ali.

Ali said that Cetin sought an acknowledgement of funds from them which will be deducted from investment without any profit.

He further noted that there was no agreement to share profits and no profits to share as Cetin did not supply what they had agreed.

“The defendant did not receive tractors as alleged but received completely knocked down units which were as good as spare parts and the defendants had to spend money to assemble the units, some of which had missing parts,” said Ali.

He said Cetin proceeded to forge documents with a view to make a case and a report has been made to the police.

Ali said that Wananchi Farm Machinery and Accessories Limited in good faith placed logbooks in possession of Bathief but following the failure by Cetin to comply and following the expiry and cancellation of the agreement, the defendant sought the return of the log books from Bathief and a suit filed to that effect.

Ali said he was introduced to the company by Mohamed Bathief with whom they had worked with for 10 years.

“I said, I needed to know him before we could do any business. Cetin offered and there was an agreement that he would bring into the country tractors and machines to be sold by us as a form of investment,” said Ali.

 

 

 

Haniel Mengistu
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