AG left out as ‘hotel sale was civil matter’

Lawyer Stephen Mwenesi (left) cross-examines KACC deputy director Fatuma Sichale at the commission of inquiry investigating the sale of the Grand Regency Hotel. Photo/PHOEBE OKALL

The Kenya Anti-Corruption Commission did not involve attorney-general Amos Wako in negotiations to dispose of the Grand Regency Hotel because the matter was purely civil, an inquiry was told on Monday.

“There was absolutely no reason to involve the AG since he does not act for the Kenya Anti-Corruption Commission in civil matters,” KACC deputy director Fatuma Sichale said.

Ms Sichale was being cross-examined by former Finance minister Amos Kimunya’s lawyer, Prof Githu Muigai, at the commission investigating the sale of the hotel.

Mr Kimunya has been in the spotlight following the sale of the five-star hotel. President Kibaki has appointed the commission chaired by retired judge Abdul Majid Cockar to investigate the sale.

Parting ways

Ms Sichale, who has been giving evidence since Wednesday last week, said that KACC was not involved in the sale of the hotel but only assisted the Central Bank of Kenya to recover it from Goldenberg chief architect Kamlesh Pattni and his company, Uhuru Highway Development Limited (UHDL).

Mr Pattni and UHDL owed the bank Sh2.5 billion.

KACC filed a civil suit in court where it sued Mr Pattni, UHDL and 17 others on behalf of the CBK.

However, after the CBK complained that the case was taking too long, Ms Sichale drafted a consent where Mr Pattni agreed to transfer the hotel to the bank.

The anti-graft body, however, differed with the CBK on the modalities in which the hotel was to be disposed of, resulting in the two parting ways.

It also emerged during the cross-examination that the CBK also saw no reason to involve the attorney-general in the sale of the hotel.

“CBK is a statutory body. It has its own lawyers and it is not represented by the AG,” Ms Sichale said in response to a question by Prof Muigai.

Further cross-examination of Ms Sichale by a lawyer representing the Libyan company, Mr Michael Mubea, revealed that it had inherited liabilities.
Mr Mubea had asked if Ms Sichale was aware of any money remitted to the CBK as KACC had been appointed one of the hotel’s receiver managers.
She said the hotel had made a profit of Sh341 million by the time it was handed over to CBK. But Mr Mubea said his client only inherited liabilities.
Mr Justice Cockar told the lawyer that one of the receiver managers who is scheduled to testify this week is better placed to answer the question.
Not competent
On a number of occasions, assisting counsel to the commission Wilfred Mati had to intervene when Ms Sichale was asked a question outside her jurisdiction.
In one instance, Mr Stephen Mwenesi, representing Mr Ahmed Adan, asked her if she thought there was any problem with President Kibaki and other officials negotiating the sale of Grand Regency.
Mr Mati protested that it was wrong to seek the opinion of the witness on such a matter while Ms Sichale said she was not competent to answer the question.
CBK lawyer Waweru Gatonye continues the cross-examination today.