High Court in Nairobi has declared former Wajir Governor Mohamed Mohamoud and his wife Kheira Maalim bankrupt for failing to pay Sh7.6 million debt owed to a construction company.
Judge David Majanja found that Mohamoud and his wife were unable to settle the debt owed to Autosteel and Tiles Limited despite a court order being issued in 2020.
The construction company had supplied building materials for the construction of the Sunrise Shopping Mall in Eastleigh, which is associated with Mohamoud.
However, after delivering the goods, the company complained that the governor failed to pay them the agreed amount.
The couple, on their part, told the court that Autosteel and Tiles Limited delivered weak tiles that broke barely a week after being laid out. Further, they claimed that the firm allegedly failed to replace the tiles as agreed.
A court order issued on January 17, 2020, by High Court judge Justice Francis Tuiyott directed the two to pay the company Sh4.1 million but due to lack of compliance, the debt grew to Sh10.6 million due to interest and costs of the court case.
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The governor agreed with the firm to pay a total of Sh8 million before May 20, last year, but he only paid Sh2.9 million, prompting the firm to file for insolvency over the outstanding balance of Sh7.6 million. Autosteel petitioned the court to declare the couple bankrupt to enable it to recover the debt.
“There is no reason a bankruptcy order should not be made as the decretal sum is not disputed and has been outstanding since 2020, when judgment was entered against the debtor. This is clear evidence of inability to pay debts by the debtors,” Justice Majanja ruled.
The new order paves the way for a trustee to manage the commercial and financial affairs of the couple. It also prohibits them from holding any public office or being directors of their companies or any other company.
“A bankruptcy order can be lifted if the debtor pays off his debts. The bankrupt will automatically be discharged from bankruptcy after three years whether the debt is paid or not,” Business Registration Services (BRS) states.
Mohamoud was the second Wajir governor and was impeached in May 2021 after being accused of abuse of office, gross misconduct, financial impropriety, and violation of the constitution.
