Billionaire Munga loses bid to stop Sh150 million case
Billionaire businessman Peter Munga. FILE PHOTO | NMG
What you need to know:
- Businessman Peter Munga is said to have refused to remit full amount from share sale to former friend.
Billionaire businessman and Equity Bank founder Peter Munga has lost his bid to dismiss a suit filed against him by his friend-turned-adversary Joseph Kamau seeking Sh150 million compensation for a botched share sale deal.
Justice Fred Ochieng ruled that the suit will continue, but he will still have to determine whether or not to retain Mr Kamau’s firm Bethany Vineyards in the suit.
Mr Munga had asked the judge, through an application, to dismiss the suit, arguing that Bethany Vineyards had filed evidence to prove that its directors approved of court action.
Bethany Vineyards and Mr Kamau had claimed in the suit that Mr Munga has since 2011 refused to pay for three million Transcentury shares worth Sh150 million that he purchased from the firm.
Mr Munga in his application argued that the directors cited in the resolution for court action against him are not the same ones listed in Bethany Vineyards’ memorandum and articles of association.
This, he argued, meant the directors in the resolution may not be legitimately in office.
Justice Ochieng ruled that there is no reason to expel Mr Kamau from the suit, but that Bethany Vineyards will have to provide evidence that it legally appointed the directors listed in the resolution that called for court action against Mr Munga.
“The onus is upon Bethany Vineyards to satisfy the court that it complied with the terms of its memorandum and articles of association when it appointed the signatories of the board resolution as directors. Finally, I find no reason to warrant the striking out of Mr Kamau’s suit. To that extent, the application fails,” Justice Ochieng ruled.
Mr Kamau sold the shares in 2011 at Sh50 each to Mr Munga after failing to settle a Sh40 million loan he took from Equity Bank. The deal was to see Mr Munga clear Mr Kamau’s loan and remit the balance to him and his firm.
But Mr Kamau sued claiming that Mr Munga only cleared the loan balance then refused to remit to him or Bethany Vineyards the balance.
Mr Munga had earlier offered to settle the dispute out of court, and proposed paying Mr Kamau Sh90 million. But Mr Kamau dismissed the offer, prompting the suit to return to court.
