Remove Mumias Sugar Company Receiver Manager – Court Told

Milimani Commercial Court has been urged to remove Mr. Ponangipalli Venkata Ramana Rao as the receiver-manager of Mumias Sugar Company.

Lawyer C. M. W. Wekesa told Presiding Judge, Justice Alfred Mabeya that Mr. Rao is guilty of incompetence and misrepresentation. “From the affidavit, he swore on his behalf and that of Kenya Commercial Bank (KCB), he is still evaluating the bids even up to now as the litigation is going on.”

He claimed Rao failed to follow the orders of the court and that he was second-guessing the court’s order. “ That is contempt of court, he should have come to this court and sought variation of court orders and filed a detailed account. We have made out our case to have the receiver removed because of incompetence, unprofessionalism, and fraud.”

The court also heard that Mr. Rao lacked transparency and accountability as he undertook to hold consultative meetings with all stakeholders including former employees, but did not do so. It was also claimed in court that he had made an attempt to approach four former employees of Mumias Sugar on 20^th February 2022 with a view of compromising their application before the court. Justice Mabeya was informed that Mr. Rao, despite making some undertakings, had failed to meet any of them.

At the same time, Justice Mabeya has admitted a supplementary affidavit filed by the Attorney General (AG) in the case where five farmers, West Kenya Sugar Company and Mumias Outgrowers (1998) Limited are challenging the leasing of Mumias Sugar Company to Sarrai Group.

The farmers are Lambert Lwanga Ogochi, Augustino Ochacha Saba, Prisca Okwanko Ochacha, Robert Mudinyu Magero, and Wycliffe Barasa Ng’onga. The defendants in the case are Mr. Rao, Kenya Commercial Bank (KCB) Limited, the Attorney General, Cabinet Secretary Ministry of Agriculture, Livestock and Fisheries, Competition Authority of Kenya, Sarrai Group Limited, Chief Land Registrar, County Government of Kakamega, and Capital Markets Authority.

Senior Counsel, Mr. Paul Muite had urged the judge to expunge the affidavit from the court records as the court had issued clear guidance on the issue.

“The AG should have some respect for the court. He cannot treat the court with casualness as if the court is there for the AG’s beck and call.”

Justice Mabeya noted that the AG has been participating in the matter all through and he is the Government’s principal advisor. He noted that the affidavit had been filed late, and is complete about-turn to his earlier position.

Justice Mabeya pointed out that since new matters were being introduced, he would admit the supplementary affidavit. He directed the AG to file and serve other parties in the case and adjourned the matter to tomorrow at 12.30 pm.