Advocates unhappy with LSK Chair
02 October 2014, 21:42
Nairobi - A section of the 6 500 Law Society of Kenya (LSK) advocates in the country are dissatisfied with their Chairman, Eric Mutua, for imposing KES 39 000 on them as contribution towards the construction of Society’s proposed International Arbitration Center in Nairobi.
The group argued that Mutua did not consult the members during the LSK Council’s September 27, Special General Meeting before coming up with the decision to raise a total of KES 250 million and that LSK has not provided information to show that it is able to meet obligation of the project in addition to the projected income from the project after completion.
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“The LSK proposes to collect about KES 250 Million from about 6 500 active members at about KES 39 000 per person, and thereafter borrow about KES 1 Billion to finance the project. If it is assumed the repayment is 25 years at 16%, the monthly repayment amounts to about KES 15M per month,” said Alex Gatundu, an LSK advocate.
Gatundu said the LSK Council has maintained “a studious silence on the issue, hoping it will just disappear, because there are no clear answers to the issues the membership is raising and it would seem no proper cost – benefit analysis has been done.” Thus members fear LSK may fail to service the KES 1 billion loan and advocates being guarantors be held responsible.
They also called on Mutua to clarify whether the KES 39 000 contribution will be refunded with some benefits such as dividends and interest or is just charitable in nature.
The group accused the LSK Council of intimidation by refusing to engage young advocates who are interested to participate in the project and prefer the formation of a Special Purpose Vehicle (a new company) to spearhead the project.
“This intransigence by the LSK Council is further revealed in their refusal to inform members how the KES 27 million expended so far, even before groundbreaking, was spent and which professionals were paid. As trustees, the LSK Council is accountable to the membership, and should not dismiss their inquiries as mere ‘noise making’, as is currently happening,” said Aluso Ingati, an LSK advocate.
Ingati reiterated the established Special Purpose Vehicle will comprise of respected, appointed LSK advocates as directors for the project who will engage the engineers, lawyers, architects among other relevant professionals to carry out the function currently done by LSK Council.
The LSK Council has suggested that the proposed International Arbitration Center will case backlog by over 50%, a claim the advocates have lashed out saying a functional judicial system solves the problem since arbitration process is ongoing but nothing much has been attained.
“How will an Arbitration Centre centrally located in Nairobi
reduce backlog in Nyeri, or Mombasa, or Migori, or Garissa? Indeed, if the
stated objective of the Arbitration Centre is to reduce case backlog, there
would be no better way of doing it than allocating KES 600 million of the KES
1.2 billion to Nairobi, KES 200million for an Arbitration Centre in Mombasa,
KES 200million for one in Western Region and KES 200 million for one in South
Rift or Garissa so as to spread the benefits of arbitration nationwide?,”
possed Faith Waigwa, an LSK advocate.
“The building of the Arbitration Centre should not be seen
as an alternative to reforming the judiciary or as a panacea to the ills
bedeviling the judiciary,” she warned.
The advocates called on the LSK Council to avoid its
‘studious silence’ and build a consensus on the project for transparency since
many of them don’t know the exact cost of the Center, who to finance, the
duration of the project and nature of contribution by every advocate.
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