Lamu West MP Stanley Muthama at an Eldoret court on July 1, 2019, when he was charged with evading payment of Sh487,914,642 tax for the period 2013 to 2017.
A businesswoman is in court seeking a warrant of arrest against Lamu West MP Stanley Muthama over alleged failure to settle a Sh7.1 million debt arising from purchase of a motor vehicle nearly nine years ago.
Ms Yvonne Njoki Njiru, trading as Newday Motors Limited, wants Mr Muthama arrested and, together with his company Stansha Limited, forced to pay the debt. This is after a magistrate court in Milimani, Nairobi, issued a decree in her favour on April 23, 2025.
However, Mr Muthama denies the debt and says it was wrong for the trial court to condemn him to pay a liability accrued by the company, Stansha Limited, even though he was the director.
“I have been condemned and found liable for debts that are not mine but of the company without any justifiable reason and as such puts me and my property at risk of execution. I stand to suffer substantial loss,” says Mr Muthama in his court filings against the businesswoman’s move to recover the money.
According to court papers, the initial debt was Sh3.5 million incurred on June 23, 2016 through sale of the motor vehicle, make Isuzu ELF, to Stansha Limited. The amount has accrued interest of Sh3.6 million over time, totaling Sh7.1 million.
In her claim in court, Ms Njiru alleged fraud. She stated that Mr Muthama never honoured a promise to pay despite numerous pledges, including in February 2023, when she bumped into him at an eatery in Nairobi but failed to pay.
She adds that in their various conversations, the MP acknowledged the debt and had promised to pay Sh1 million by December 2023.
“When it became apparent that he had no intention to pay for the vehicle, the plaintiffs reported the incident at Industrial Area Police Station and was recorded as OB No. 52/19/10/2023 at 15.20 hours and the same is pending investigation, arrest and prosecution of Mr Muthama,” her lawyer Robinson Kigen says in the documents. He is in the process of executing the court decree.
He says it was Mr Muthama who took possession of the vehicle and when asked by Ms Njiru via Whatsapp where it was, he said it was at Mombasa.
Particulars of the alleged fraud include using the motor vehicle for his benefit and failing to pay the purchase price.
The decree was issued after the court struck out Mr Muthama’s defence, saying he had admitted the claim. The trial magistrate added that it was not denied that the MP and Stansha Limited had taken possession of the vehicle.
“A casual perusal of the defence dated May 7, 2024, reveals that the defendant has indeed admitted entering into a sale agreement to purchase the suit vehicle at Sh3.5 million and was to pay a deposit of Sh500,000. While the defendant argues that it paid the deposit, it has not produced any evidence of payment,” said principal magistrate H.M Ng’ang’a.
The magistrate noted that if Mr Muthama wanted the court to believe he was not part of the sale agreement, he would not have made any commitment to pay Ms Njiru at all.
Concerning the defendants’ argument that Ms Njiru was in possession of the vehicle’s logbook, the court said that Ms Njiru and her company were not expected to release the same before being paid.
“This court finds that the defence is mere denial and a sham since Stansha Limited has admitted in its defence that it purchased the vehicle and has not shown any evidence of payment of the purchase price at all. The court has noted that Mr Muthama executed the agreement for sale and nowhere did he indicate that he executed it as a director of Stansha and more importantly, he admits in his defence taking possession of the suit vehicle,” said the magistrate.
The case is scheduled to be called in court on May 19, 2025, for a hearing of Ms Njiru’s application for a warrant of the MP's arrest.
The execution process came after High Court judge Moses Ado declined Mr Muthama’s petition to suspend the magistrate’s ruling pending determination of his appeal.
“The trial court did not give reasons why I was liable for debts of Stansha Limited where I was only a director at the time of the contract between Newday Motors and Stansha,” says Mr Muthama.
He adds that the trial court failed to consider the terms of the sale agreement between Newday Motors and Stansha Limited, where the vehicle was to be repossessed if the purchase price was not paid in full.
According to him, the trial court also ignored the fact that Newday Motors was paid Sh500,000 as per the terms of the agreement.
“I had already filed an application to be removed as a party to the suit as the matter touched on a contract between Newday Motors and Stansha Limited, but the trial court dismissed the application through its ruling on October 17, 2024 on the ground that there were accusations of fraud and hence triable issues for trial,” he argues. The High Court appeal is pending determination.
