Former Kiambu governor Ferdinand Waititu risks losing Sh52 million in a dispute over a failed real estate transaction.
Mr Waititu had paid the money to General Properties Ltd as a deposit to buy a commercial building in Nairobi’s city centre three years ago. The money constituted 10 per cent of the purchase for the property known as Solar House.
Mr Waititu was to buy the property for Sh520 million but was unable to pay the balance of Sh468 million even after he was given more time to do so.
He made the May 30, 2018 sale agreement using his company, Saika Two Estate Developers Ltd, where he is a director. Saika later came under the scrutiny of the State anti-graft watchdog EACC over allegations that Mr Waititu was using it to receive kickbacks from county government contractors.
In a pending corruption case, he is said to have received Sh18 million from a contractor known as Testimony Enterprises Ltd between July 2018 and March 2019.
When Mr Waititu failed to complete paying for the property, the seller retained the deposit, which was 10 per cent of the purchase price, and now wants the court to declare that its decision was legal.
General Properties also wants to terminate the sale agreement, a move that would see the politician lose the property and the deposit fee.
“It was a term of the agreement that upon default by Saika, the General Properties Ltd had the right to rescind the agreement and forfeit the 10 per cent deposit as liquidated damages for breach,” says Charles Muhia, the real estate firm’s director.
But Mr Waititu’s company has opposed the move, threatening General Properties with legal action.
Court papers show that Saika also lodged a caution against the property to compel the seller to refund the deposit.
General Properties says the sale agreement was approved by Mr Waititu’s lawyers, who also advised him to execute it. He was to pay the balance within 90 days.
“It was a condition of the agreement that time was of essence and that the balance of Sh468 million was to be paid to the vendor advocates within 90 days from May 30, 2018. The defendant (Saika) has blatantly breached the conditions in the agreement,” the seller says.
General Properties wants the court to allow forfeiture of the Sh52 million as damages for breach of contract.
It also wants Mr Waititu’s company barred from lodging any caution or interfering with the property.
Court papers indicate that on August 22, 2018, Saika wrote to the property seller confirming that it had started talking to Equity and Family banks to secure financing. Saika also said it had been promised funding but provided no evidence.
Saika directors then started dodging phone calls and text messages from the seller’s advocate, as well as delaying to respond to correspondence.
On September 21, 2018, Saika directors informed the seller that they were now dealing with Co-operative Bank to secure funding and that they needed 90 more days.
A meeting was held with Mr Waititu to allow Saika 60 more days to complete the deal and for the firm to forfeit 10 per cent.
But Saika introduced a twist, claiming that it was given false information about rent income from the property.
By Nation Africa