Monday, 6 May 2013

NEWS Contractor sues China firm for unpaid Kisumu airport work


China Overseas Engineering, the company that upgraded the Kisumu International Airport, has been taken to court for failing to pay Sh833 million to a company it sub-constructed.
Mehta Electricals Limited is demanding Sh524 million from the Chinese multinational for installing electric works at the airport and a further Sh309 million for work done in Juba, South Sudan.
“Despite demand and notice of intention to sue, the defendant continues to give excuses for delay and has failed, neglected, refused and/or ignored to settle the outstanding balance,” said Mehta Electricals Limited in court documents.
The South Sudan contract involved the rehabilitation of the National Assembly, Presidency building and Juba Hospital.
The two companies submitted joint bid for the upgrade of the Kisumu airport, with China Overseas being the main bidder and recipient of payments from the Kenya Airports Authority (KAA).
The contract was awarded in 2008 and Mehta says part of the agreement was China Overseas was to pay it 14 days after receiving payment from KAA, which is alleged to have settled with the Chinese firm in July last year.
Mehta says the Chinese firm owes it Sh524 for the Kisumu contract after settling an undisclosed payment. Kisumu Airport was upgraded to a fully-fledged international airport with a 3.3 kilometre runway at a cost of Sh3 billion.