Matunda bus firm loses 10 vehicles over debt

In allowing Scania Credit Solutions to seize the buses, Justice Sifuna said the default and arrears persisted and the bus firm continued to use the motor vehicles, causing wear and tear, while it earned a steady income from them.

“I find in the circumstances of this case are such that it [sic] has met the threshold. First, the defendant, Matunda (Fruits) Bus Service, is clearly in default and has by that default accumulated huge arrears that continue to increase,” said the judge. The amount of the defaulted debt was not revealed.

Scania Credit Solutions told the court that it provides financial leasing for commercial vehicles, including buses and trucks, mainly Scania models in Kenya and the wider African region, in conjunction with its South African affiliates.

The court heard that in October 2016, the two companies entered into a financial lease agreement for the 10 buses for a period of 36 months.

The leasing firm said it complied with the terms of the agreements and delivered the vehicles to Matunda.

Rogers Hutton, the company’s risk manager, said Matunda had defaulted in the payments under the leases and was currently in huge arrears.

Mr Hutton said the debt was mounting and the court should order the firm to release the buses.

“Clearly, the defendant (Matunda) is in court with unclean hands. For reason that while it is steeped in default and arrears that continue ballooning, it continues to use the motor vehicles in its passenger business, to earn income and insists on continuing to possess them,” said the judge.

The judge added: “consequently, the application is hereby allowed. In terms that the defendant is hereby ordered to within seven days from the date of this ruling, deliver to the plaintiff, possession of the motor vehicles.”

Justice Sifuna said if the company does not deliver the buses as directed, the creditor would be at liberty to repossess them, without any further legal proceedings.