Relief for KPA as account freeze lifted

Kenya Ports Authority yesterday got temporary relief after the appeals court discharged an order freezing its bank accounts.

However, KPA has to pay Sh51 million within seven days of accessing its bank accounts as down payment of Sh1.9 billion awarded to Modern Holdings.

Justices Martha Koome, GBM Kariuki and Sankale Kantai issued the orders after parties in the case consented to it.

KPA said if forced to pay the entire Sh1.9 billion immediately it will suffer irreparable damage. Being a state corporation, it said, it is constrained by fixed budgetary and financial allocations and as a result, not in a position to pay without prior planning.

The court was further told KPA runs sensitive installations and if forced to part with huge sums of money at once its operations. might be disrupted.

Read:KPA shut down in Mombasa as court freezes its bank accounts

The freeze was imposed on KPA by the High Court in Mombasa. It affected accounts in Citi Bank, Equity and National Bank.

Modern Holdings sued KPA and obtained an order for Sh1.9 billion award. The company, which distributes energy drinks, had brought 21 containers to Mombasa between December 2007 and January 2008, which were detained at the port.

KPA did not clear the consignment within the stipulated time due to the post-election violence.

The Authority, in consultation with the KRA, moved long-stay containers to Makupa private port to ease congestion and allow more cargo to be received at the port.

Modern Holdings said the transfer of its containers to Makupa was illegal. It cleared six containers with waivers from the KRA and KPA, but 15 containers were delayed and their contents worth Sh60 million went bad.

The company asked to be compensated for the loss but instead, Justice Patrick Otieno awarded KPA Sh890 million. It was agreed that the appeal be listed for hearing on priority basis next year.

Source