An official of East African Development Bank (EADB) has admitted that the lender did not disburse part of the loan borrowed by former Cabinet secretary Raphael Tuju.
Mr David Odongo told Justice Alfred Mabeya that the loan deal with Mr Tuju was two-phased comprising $9.1 million for purchase of a property in Karen and a second tranche of Sh294 million was for construction of villas which would have been sold by Tuju to enable him to repay the loan.
Mr Odongo said the second part of the loan was never disbursedaddinghe gave the same information to the Directorate of Criminal Investigations (DCI), when he was summoned to the DCI headquarters last year.
Mr Odongo was being cross-examined over a statement he recorded with the DCI regarding the loan.
According to Mr Tuju, the statement given by Mr Odongo to the DCI contradicts what the EABD has been stating all along and also supports his case on the nature of the $9.3 million loan as well as the history of the engagement between him and the lender.
Mr Tuju said that Mr Odongo confirmed that the project as envisaged in the agreement was two-phased in nature, which is the acquisition of the Tree Lane property as well as the construction and sale of the housing units, to repay the loan advanced to him.
The statement to the DCI confirmed that the project was viable, as it was sitting on a 20-acre parcel of land and Mr Tuju would have developed about 20 villas, rehabilitate the existing structures and that the development of the villas was the key component of the project, to enable Dari Limited (Tuju’s firm) to pay the loan.
Asked how the affidavit bearing his name was prepared, Mr Odongo said they were prepared by the bank’s advocates and was asked to append his signature.
“I trusted the guidance and opinion of the bank’s counsel. I signed the statements in good faith,” he said.
Mr Odongo also told the court that he was apprised about the project, and he presented it to the board for approval.
Yesterday, the official confirmed that a UK judgement ruled in favour of the lender and the decision was registered by the High Court.
In the dispute, Mr Tuju stated that the lender provided $9.1 million for the acquisition of the property but the balance, which was meant for the development of high-end residential units for sale, was never disbursed.
The loans were for the construction of Sh100 million two-storey, flat-roofed bungalows sitting on a 20-acre forested land dubbed Entim Sidai and the purchase of a 94-year-old bungalow built by a Scottish missionary, Dr Albert Patterson, which currently operates as a high-end restaurant.
But according to the bank, the balance was never disbursed because Tuju’s company –Dari Ltd— breached the agreement by failing to pay $11,462,757 as of November 10, 2017.
The UK judgment was adopted by the High Court in February 2020 but Dari Ltd moved to the Court of Appeal and escalated it to the Supreme Court, as he questioned the adoption of the English judgment.
The case was adjourned to July 31 for further hearing.
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