UoN faces Sh237m claim from tower contractor - Daily Nation

UoN faces Sh237m claim from tower contractor

Monday February 11 2019

University of Nairobi vice-chancellor Peter Mbithi.

University of Nairobi vice-chancellor Peter Mbithi. FILE PHOTO | NMG 

By GALGALLO FAYO
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The University of Nairobi is facing a Sh237 million claim from a quantity surveyor who was hired during construction of its Sh2.3 billion tower, adding to financial woes facing the institution.

Songa Ogoda & Associates has filed a suit seeking to compel the university to pay a Sh193.8 million arbitral award plus interest on the overdue debt.

The firm was retained in November 2011 to undertake quantity surveying consultancy for the construction of the University of Nairobi Tower but the agreement was terminated a few months later, leading to the current dispute that was referred to arbitration.

“That the honourable court be pleased to adopt as a judgment of the court capable of enforcement in execution the final arbitral award dated November 24, 2017… in favour of applicant for the sum of Sh193.8 million with simple interest thereon at 14.5 percent per annum from December 2017 to date,” reads the order sought by the quantity surveyor.

The firm also wants the university to reimburse it its Sh13 million arbitrators’ cost.

The claim adds on the financial woes facing the University of Nairobi, which earlier last week revealed that among the huge debts facing the institution is Sh1.6 billion in unremitted pension and statutory deductions for its workers.

Documents filed in court on January 8, 2019 by Songa Ogoda & Associates show that the UoN had put up a robust defence before the tribunal but it is not clear why it did not appeal against the decision of the arbitrators.

The firm is now asking the court to enforce the award since it has not been challenged.

Songa Ogoda & Associates was part of a consortium of six multi-disciplinary firms retained by the university to design and oversee construction of the tower.

University of Nairobi Tower

The 22-storey University of Nairobi Tower. FILE PHOTO | NMG

Bill of costs

The quantity surveyor prepared the bill of costs which was used to tender and the contract awarded to China Wu Yi Company but the award was cancelled by the Public Procurement and Review Board in June 2012.

The university asked the firm to restructure the bill of quantity but subsequently re-advertised the tender, which was awarded to China Wu Yi Company.

After the award, the university terminated the contract, which the Songa Ogoda & Associates claimed was done illegally.

The quantity surveyor claimed that the institution failed to pay for the services rendered before cancellation of the contract.

But the university told the arbitrators that the quantity surveyor prepared flawed tender documents that led to cancellation of the contract.

The university argued that since it engaged other experts to prepare fresh tender documents, the firm is not entitled to any compensation.

But the three arbitrators; Stanley Kibathi, Gitonga Murugara and Haron Nyakundi ruled that a valid contract existed between the firm and the university.

The arbitrators further found that the University of Nairobi had adopted documents presented by the firm, which it used to float the tender and there was no record of any complaint.