The government will pay Sh40 million to a contractor over a botched deal for the construction of a prefabricated exhibition centre at the Kenyatta International Convention Centre (KICC).
High Court judge Lawrence Mugambi directed the KICC to pay Parbat Siyani Construction Ltd after dropping plans for the construction of the exhibition centre at a cost of Sh799 million.
The judge said the money would compensate the contractor for violation of its rights and the Sh39.95 million was equivalent to the amount of the performance guarantee.
“In my very humble view, the Respondent’s (KICC) conduct in this whole process does not demonstrate transparency or accountability in the handling of the procurement,” said the judge.
The court said the management of KICC was very much aware of the timelines required for the execution of a valid contract, after the notification of the award, yet it kept the contractor in limbo without updating the firm on the progress.
The firm through its director Mr Mukesh Halai submitted that it emerged as a successful bidder after KICC announced the tender in 2018.
Mr Halai said the tender was re-advertised for the second time and his firm won the tender, after receiving a letter on January 31, 2019.
The firm was awarded the tender in April 2019 and it was thereafter, invited for the contract negotiations and presentation of the proposed design on May 13, 2019.
He said the signing of the contract was scheduled for May `6, 2019 but this did not happen after the signing was rescheduled to allow further negotiations.
On May 22, 2019, the company said it submitted the bid security in the form of a performance guarantee from I&M Bank for Sh39.95 million in line with Clause 3.28.4 of the request for proposal.
A few days later, KICC cancelled the contract citing “circumstances beyond our control”.
In reply, the chief executive officer Mr James Mwaura said no contract was signed and a notification of the award does not constitute a contract.
Mr Mwaura added that the request for proposal required the contractor to give a performance guarantee within 28 days of the notification of award but the company provided the same outside the stipulated period.
Justice Mugambi said the government employed deliberate delaying tactics by taking the company around in circles until the tender validity period expired.
“It is my finding that the manner in which the respondent treated the Petitioner does not align with the principles of procurement as set out in Article 227 (1) as such conduct cannot be described as transparent or fair,” he said.
