Supreme Court dismisses Bia Tosha's Sh39bn contempt case against EABL

 

Supreme Court has dismissed the contempt of the court case against East African Breweries Limited (EABL) and Diagio executives that could have seen them pay former distributor, Bia Tosha Sh39 billion.

In the ruling delivered Friday, the highest court in the land returned the case to High Court and struck out Diagio executives.

Bia Tosha had sued East African Breweries Limited (EABL) executives including  CEO Jane Karuku for contempt of court in a long-running battle between the beer maker and the distributor.

The distributor had sued Karuku together with Andrew Kilonzo, the managing director of Uganda Breweries Ltd for failing to honour the Appeal Court decision to reinstate distribution routes redistributed in 2006.

It had sought to have the directors fined an equivalent of 20 percent of EABL’s sales, or Sh39 billion for refusing to give it back beer distributorship routes in parts of Nairobi, Machakos and Kajiado.

In an appeal, Karuku together with Kilonzo asked the apex court to review the decision issued last month, saying the court condemned them unheard. Also named in the case was former director Andrew Cowan.

The top court had found the officials in contempt over the termination of the contract with Bia Tosha and reverted the matter back to the High Court for punishment.

The senior officials urgued that the punishment of jailing them for six months, as sought by Bia Tosha, was radical and gross that should never be issued without hearing them.

The Supreme Court found the application by Bia Tosha to be legally untenable and criticised the applicant for improperly introducing parties not involved in the primary dispute through an application for contempt.

On Friday, it sent back the distribution case to the High Court while dismissing the case and earlier decision against the directors.

“In the result, and having remitted the dispute to the High Court, we reiterate that the parties are at liberty to raise all their issues for determination by the High Court, which is competently seized of the dispute,” court papers read in part.

The long-running court battle dates back to 2016 when Bia Tosha accused Kenya Breweries Ltd (KBL) of terminating a distributorship contract entered that year.

The distributor moved to court and sought among others, an injunction stopping KBL and UDV (Kenya) from interfering with its distribution business.

KBL opposed the application and after hearing the case, the High Court dismissed the case and referred the matter to arbitration.

Bia Tosha then moved to the Court of Appeal and sought an order stopping KBL from interfering with the distributorship contracts, pending the determination of the case and the court directed the parties to maintain the status quo. 

The distributor then filed contempt proceedings against Kilonzo, Karuku and other key persons, alleging disobedience of court order.    BY THE STAR