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Court halts Ksh 74M payment to lawyers representing Kenyan in company dispute

Kenyan Businessman Kirimi Koome with his lawyer Omwanza Nyamweya at Milimani High Court on December 21,2023

The High Court has temporarily issued a stay order barring the implementation of a consent that directed a bank to transfer Ksh 74 million as legal fees to lawyers representing a businessman in Ksh 400 million company dispute.

Justice Alfred Mabeya of the commercial and tax division on Wednesday granted the orders sought by a Rwandese businessman Desire Muhinyuza through his lawyer Danstan Omari.

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“Pending hearing and determination of the case, court issues an order on injunction temporarily staying the implementation of the consent orders issued on October 30, 2023 directing the manager of United Bank of Africa Westlands branch to transfer from Stayonline Limited US dollar account the sum of Ksh 35.5 million plus the accrued interests to Omwanza and Areba associates advocates and the sum of Ksh 38.8 million plus accrued interests to Ivy Ateko Ingati respectively,” Justice Mabeya said.

The court directed the respondents to file their responses within 14 days and the case be mentioned on February 16, 2024.

Last week, investor Desire Muhinyuza filed an application accusing businessman Kirimi Koome’s advocates of fraudulently obtaining consent from court to be paid Ksh 74 million in legal fees.

In the application filed at Milimani court,  Muhinyuza through his lawyer Danstan Omari claim Koome’s lawyers Omwanza Nyamweya and Ateko Ingati fraudulently obtained the consent when they knew the ownership dispute was still pending in court.

Danstan Omari claims that the consent was stage managed by Koome’s two lawyers in conjunction with Raphael Olwako on behalf of Stayonline company.

“The impugned consent order was obtained without the lawyers making material disclosure to the court as to the status of Stayonline Ltd and that these proceedings were commenced in bad faith with ill intention of unlawfully utilizing funds amounting to Ksh 74,300,00 held in Stayonline’s bank accounts at UBA” Omari cites in court papers

He wants the court to review the consent informing court that Olwako is not the director of the company in question and it was all a scheme to unlawfully withdraw the money held by the company in the guise of legal fees.

According to court papers, Omwanza and Ateko failed to disclose to court that there were proceedings active in court on the ownership dispute between Desire and Koome.

On December 27, the High Court declared that a ksh 400 million disputed fintech firm belongs to a Rwandese investor. The Judge ordered Koome to pay back $100,000 (Ksh 15.6 million), which he is said to have received from the Rwandese investor for tax purposes but never paid.

Ruth Wamboi
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