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Kenya Ports Authority battles order to pay Sh1.9b to Tanzanian firm


MOMBASA, KENYA: Lawyers have differed sharply in an appeal by Kenya Ports Authority (KPA) against a High Court order compelling the state corporation to compensate Sh1.9 billion to a Tanzanian firm whose goods were destroyed at Mombasa port during the 2007/2008 post elections violence.

Modern Holding company based in Arusha sued KPA in 2009 accusing it of failing to execute its duty of handling imported goods through Kilindini port until it is collected by the importer within a specified time. The Tanzanian firm sought Sh2.4 billion in compensation.

The Tanzanian company’s Chief Executive Anselm William Minja said when the case began last year that it imported 21 containers with soft drinks worth Sh 2.4 billion through the port destined to other countries in Africa.

He also said when the goods arrived in Mombasa between December 9 2007 and January17 2008 they could not be cleared because of the post-election violence adding that during that period no cargo left the facility causing it to incur a huge storage charge.
KPA launched a defence by accusing the Tanzanian firm of blaming and suing the wrong party but lost and the state corporation has sought relief in the Court of Appeal.

KPA through its lawyers George Oraro and Mohamed Nyaoga says the judgement flouted the KPA Act of 1978 but the Tanzanian firm through Kioko Kilukumi argues that the statute is unconstitutional for outlawing compensation suits against KPA.
They submitted on Friday when Oraro told Court of Appeal in Mombasa that Kenya Ports Authority should not pay the Sh1.9 billion to Modern Holdings.
Oraro told Justices Asike Makhandia, William Ouko and Kathurima M’Inoti that the High Court which ordered KPA to compensate Modern Holding sh 1.9 billion with interest had no jurisdiction to do so.
The lawyer who teamed with Nyaoga told the court that KPA Act of 1978 bars anybody from filing or taking action in court against KPA for the loss of the cargo at Mombasa port.
Oraro insisted since the court which ordered KPA to compensate Mordern Holdings Sh 1.9 billion for failing to release to the company owners 15 containers with perishable goods in time had no jurisdiction the court should now overturn the ruling.
But Kilukumi told Court of Appeal that the Act Oraro and Nyaoga are citing is outdated and cannot be applied following the promulgation of the 2010 constitution which has exhaustively addressed what the two lawyers are advancing.

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