Ex-NYTIL shareholders lose sh14b case
FORMER minority shareholders of Nyanza Textile Industries (NYTIL) have lost a case in which they had challenged a decision by the Inspector General of Government to block a sh14b payment to them.
By Hillary Nsambu
FORMER minority shareholders of Nyanza Textile Industries (NYTIL) have lost a case in which they had challenged a decision by the Inspector General of Government to block a sh14b payment to them.
They petitioned court in 1996 demanding $3m (sh5b) principal amount and interest from 1996 when the company was sold.
In January last year, they agreed with the Attorney General that the Government would compensate them. However, the IGG, Justice Faith Mwondha, petitioned the High Court to set aside the consent judgment.
She argued that the two parties did not follow proper procedure in entering the agreement.
She added that it was likely to cause financial loss to the Government and also affect the interests of the other shareholders, who had been left out of the deal.
On January 29, finance minister Ezra Suruma, wrote to the IGG, asking her to stop the payment because the consent judgment between the shareholders and the Solicitor General had not been approved by the ministry.
The group petitioned the Court of Appeal, saying the IGG had no authority to question their deal since she was not involved in the original case.
But the appeal court last week ruled that the IGG was justified to ask the High Court to review the agreement she thought was fraudulently reached.
Justice Galdino Okello (now at the Supreme Court), led the three-member panel. The other justices were Christine Kitumba and Alice Mpagi-Bahigeine.
“It must be appreciated that in such a case, it is not the Inspectorate of Government questioning or reviewing the decision of the court. The Inspectorate just adduces evidence and the law for the court to review its decision,†Kitumba argued.
The 120 minority shareholders include UPC president Miria Obote, Nkumba University Vice-Chancellor Prof. Senteza Kajubi and former minister Paul Etiang.
Others are Gordon Sentiba, Katikamu North MP Abraham Byandala and veteran politician Adoko Nekyon.
FORMER minority shareholders of Nyanza Textile Industries (NYTIL) have lost a case in which they had challenged a decision by the Inspector General of Government to block a sh14b payment to them.
They petitioned court in 1996 demanding $3m (sh5b) principal amount and interest from 1996 when the company was sold.
In January last year, they agreed with the Attorney General that the Government would compensate them. However, the IGG, Justice Faith Mwondha, petitioned the High Court to set aside the consent judgment.
She argued that the two parties did not follow proper procedure in entering the agreement.
She added that it was likely to cause financial loss to the Government and also affect the interests of the other shareholders, who had been left out of the deal.
On January 29, finance minister Ezra Suruma, wrote to the IGG, asking her to stop the payment because the consent judgment between the shareholders and the Solicitor General had not been approved by the ministry.
The group petitioned the Court of Appeal, saying the IGG had no authority to question their deal since she was not involved in the original case.
But the appeal court last week ruled that the IGG was justified to ask the High Court to review the agreement she thought was fraudulently reached.
Justice Galdino Okello (now at the Supreme Court), led the three-member panel. The other justices were Christine Kitumba and Alice Mpagi-Bahigeine.
“It must be appreciated that in such a case, it is not the Inspectorate of Government questioning or reviewing the decision of the court. The Inspectorate just adduces evidence and the law for the court to review its decision,†Kitumba argued.
The 120 minority shareholders include UPC president Miria Obote, Nkumba University Vice-Chancellor Prof. Senteza Kajubi and former minister Paul Etiang.
Others are Gordon Sentiba, Katikamu North MP Abraham Byandala and veteran politician Adoko Nekyon.