A US-based contractor has won Sh119 million from the National Housing Corporation (NHC) as compensation for delays in building 230 housing units in Nairobi’s Lang'ata estate.
American firm Lemna International had filed a claim of Sh505 million but an arbitrator ruled that NHC pays the Sh119 million in compensation for the delay in completion of the housing project. NHC entered into a contract with the US construction company in 2011 to develop 230 housing units at Sh902 million. The 230 houses are part of the NHC’s Lang’ata Housing Scheme Phase IV.
“M/s Lemna claimed Sh505 million for four extension of time claims. An arbitrator ruled in favour of the contractor and ordered NHC to pay Sh119 million. “There is also an arbitration fee of Sh1.6 million to be paid equally by both parties. The lawyers who represented NHC in the arbitration has also forwarded a fee note of Sh18 million out of which Sh5 million has been paid as deposit,” Andrew Saisi, the NHC managing director told the National Assembly’s Public Investment Committee (PIC).
Mr Saisi said the NHC is considering the arbitrators award “with the possibility of paying the Sh119 million or appealing the same to the High Court.”
The Auditor-General had questioned the implementation of the project whose contract had lapsed in 2013 when the works done was 25 percent.