An administrator of the estate of former Cabinet Minister Mbiyu Koinange has ought an order compelling Ecobank Kenya to explain the withdrawal of Sh284 million from the sale of one of the properties belonging to the estate.
Eddah Wanjiru Mbiyu said in an application that the money was allegedly withdrawn illegally and irregularly, without her consent as one of the administrators.
Ms Wanjiru, the fourth widow of the late minister in Mzee Jomo Kenyatta’s cabinet, wants the bank to disclose who benefited from the funds.
“That as an administrator of the estate, I have a duty to ensure that the beneficiaries get their share of Sh284 million which the court found to be shared by all identified beneficiaries,” she said in the application.
The money was the proceeds of the sale of 100 acres of the Closeburn estate to investment group Centum for Sh1.16 billion.
Former Chief Justice David Maraga, then a judge of the High Court, had ordered that the money be kept in a bank account and should not be withdrawn as it was meant for the beneficiaries of the estate.
The court order, made on July 27, 2011, directed that the funds could only be disbursed with the authority of the court.
Through senior counsel Paul Muite, Ms Wanjiru said part of the proceeds from the sale of the land to Centum was distributed to the administrators, beneficiaries and lawyers acting for the family, while the balance of Sh284 million was deposited into a bank account at Co-operative Bank.
The funds were later transferred to Ecobank Kenya by lawyers acting for the administrators, who, after discovering the move, they obtained a court order blocking the withdrawal of the funds without a court order.
“It later came to my knowledge that the bank had illegally and irregularly without the permission of the court, caused the entire amount of Sh284 million to be withdrawn,” Ms Wanjiru said in the application.
As a beneficiary, Ms Wanjiru said she was entitled to a share of the amount plus interest as the court found that the money belonged to the estate of the late Koinange.
She now wants the bank to disclose and give particulars of amounts and all beneficiaries of the money.
From the sale of the land, each of the four administrators got Sh50 million, while the 11 children received between Sh10 million and Sh40 million.
Part of the money was also paid to several lawyers involved in the sale transaction and legal services provided to the family.
Appearing before Justice Eric Ogolla, Mr Muite submitted that all lawyers’ legal fees were fully paid as per the court order.
He added that Ecobank Kenya allowed the withdrawal of the funds without the authority of the court or the consent of Ms Wanjiru in violation of the court orders.
The veteran lawyer added that the High Court in its judgment in May 2020, while distributing the assets to the beneficiaries, noted that there was no plausible explanation from any of the lawyers as to why the money should not be returned to Koinange’s estate.
“That I believe that had Ecobank Kenya Limited conducted due diligence it would have required a court order to authorise the withdrawal of the funds deposited in its bank,” he said.
The bank defended itself saying the money was withdrawn by signatories of the four law firms that represented the administrators.
Violet Monari, the branch manager of the Ecobank Towers branch, said the bank acted lawfully on the instructions of the signatories.
She said Ms Wanjiru made a similar application in 2013 and the matter was determined by the court.
The manager said the bank did not appropriate or benefit from the withdrawn funds.
“That I am aware that the bank acted on all lawful debit instructions of the signatories and was not aware of any orders (more specifically the orders of July 26, 2011) stopping, halting and restricting the bank from acting on the lawful instructions of the signatories who were reputable advocates of the administrators herein,” she said.
She said the last debit to the bank account was Sh540,000, which was effected on June 11, 2014.
Ms Monari said there was a similar application made in September 2013 and to file another petition more than 10 years later was in bad faith.
Koinange died on September 3, 1981, without a Will and the matter was filed in court the same year he died. The estate has 12 beneficiaries.
It was not until four decades later that Justice Aggrey Muchelule (now a Court of Appeal judge) made a significant step in sharing the estate, estimated to be worth Sh14 billion.
Koinange served in Mzee Kenyatta’s cabinet and briefly in the cabinet of his successor, Daniel arap Moi.
The estate had initially been distributed in 2015, but Justice William Musyoka left out two widows - Ms Wanjiru and Margaret Njeri Mbiyu - who promptly filed an appeal and successfully petitioned to be included in the distribution.
The Koinange family consists of four houses, the house of Loise Njeri Mbiyu (deceased) who had five beneficiaries, the house of Ruth Damaris Wambui Mbiyu with five beneficiaries, the house of Margaret Njeri Mbiyu with one beneficiary and the house of Eddah (one beneficiary).
The judge ordered that some of the properties be sold and the proceeds paid into a joint account held by the four administrators of the estate.
