A Sh185 million debt between Moi University and a contractor in a botched construction deal has since ballooned to more than Sh1 billion and is now threatening to stall the operations of the once-vibrant institution of higher learning.
Last week, the High Court gave the university 30 days to come up with a plan to pay the debt to Vishva Builders Ltd, failing which its 69 bank accounts would be attached.
An attachment order had been issued against the institution's 69 bank accounts, and the university challenged the order, especially the interest on the debt. The construction firm is demanding Sh1.25 billion.
The university challenged the interest, arguing that the matter had at some point been dismissed for want of prosecution in 2015 and reinstated later in 2019. According to the university, the interest should not be counted during the period when the case was dormant.
Further, the university indicated that all the attached accounts need to be distinguished to determine which belong to third parties, student accounts, and donor or research accounts.
Consequently, the court gave Moi University one month to come up with a payment plan.
The main entrance to Moi University in Kesses, Uasin Gishu County.
Photo credit: Jared Nyataya | Nation Media Group
The dispute stems from a contract for the construction of the Faculty of Science Complex, a government-sponsored project initiated in the 1990s and which was to be financed by the National Treasury.
Evidence placed before the court showed that, by a contract dated November 13, 1990, Moi University entered into an agreement with the company to build the Faculty of Science buildings at the institution.
Drawings, bills of quantities and the tender form showed that the contract sum was Sh476.3 million. The tender submitted by Moi University was Sh547.7 million, but the parties negotiated and the price was reduced to Sh476.3 million.
A letter from then Vice Chancellor Dr J.K. Sang, who was the Chief Administrative Officer, authorised the contractor to commence the works immediately.
By a letter dated June 19, 1990, the lead consultant, also known as the Project Architect (Messrs Joel E.D. Nyaseme & Associates) and described as the Departmental Representative, notified the university that the site handover ceremony would take place the following day.
The contractor moved in as agreed and commenced the works. The contract period was 130 weeks, and the project was expected to be completed by December 31, 1992.
However, due to financial constraints on the part of the university, and after seven certificates had been issued to the contractor, the university asked for the works to be stopped, and the contractor obliged.
The works were stopped in April 1991, and the parties subsequently mutually wound up the contract in November 1999.
The contractor informed the court that the company was at all times ready and willing to fulfil and perform all its obligations under the contract and complete the works, but the university failed on its part of the bargain by not paying the sums certified as due.
After agreeing to close the contract, the university allegedly agreed to pay for the works carried out once funds were available and after verification by a government task force on pending bills.
Moi University submitted that the contractor was paid sums under interim certificates amounting to Sh57.2 million, plus a retention sum of Sh6.3 million.
Further, the institution admitted that it was unable to raise funds to complete the project, and the works were halted when about 9 per cent had been completed.
It maintained that it had the right to cancel the certificates, particularly the interim ones, as the contract entailed building four floors, but the contractor only built the substructure (the work below the ground floor). According to the university, the claim was not justifiable.
In 2002, a summary judgment was entered in favour of Vishva Builders Limited, only to be overturned by the Court of Appeal and sent back to the High Court for a fresh hearing.
Three years later, the suit was dismissed after the contractor failed to prosecute it, only to be revived and handled by two other judges before Justice Wananda Anuro ruled in favour of the construction company.
“It is truly an example of a court case having the proverbial ‘nine lives’,” the judge said when he put the matter to rest and directed the university to pay the company Sh185.3 million for the botched contract.
The judge said it was unacceptable that a commercial suit of such magnitude should be held up in court for almost 25 years.
Nelson Havi, acting for Vishva Builders Limited, on February 2, 2025, obtained a decree for Sh1, 083,388,379.94 as computation of the interest amount.
The High Court issued an order through an application dated February 4, 2026, to attach 69 bank accounts belonging to Moi University, which was opposed by the university’s legal team led by Martin Gitonga.
The university indicated to the court that all the attached accounts needed to be distinguished to determine which belonged to third parties, student accounts, donor or research accounts.
They argued that the advocates needed 30 days to liaise with the university on how to generate a payment plan for the undisputed amount.
When the matter came up for mention on February 17, 2026, Moi University appealed for additional time on how to settle the amount, and the court will issue its ruling on March 26, 2026.
