The Supreme Court has ended a company’s bid to reopen a 22-year dispute with the Central Bank of Kenya over Sh14 million frozen during investigations into a Treasury Bonds fraud, shutting the door on its final appeal.
The five-judge bench ruled that Johmat Distributors Ltd’s grievances over interest, legal costs and a long-running freezing order did not raise issues of general public importance required for an appeal to the apex court.
The ruling closes litigation that began after CBK alleged that Sh205 million had been fraudulently obtained in 2002 through manipulation of Treasury bonds and Treasury bills.
The bank suspected Johmat’s account had been used to channel part of the money and obtained a court order in July 2003 freezing Sh14 million held in the firm’s fixed deposit account at Giro Commercial Bank, now I&M Bank.
Johmat was later joined to the recovery suit. After years of litigation, the High Court dismissed CBK’s claim in December 2019, finding it was based on mere suspicion.
The court, however, also rejected Johmat’s counterclaim for damages and interest after finding the company had not proved its entitlement to the claims. The parties subsequently recorded a consent allowing the release of the frozen funds.
The company challenged the decision at the Court of Appeal, arguing that it deserved interest because the money had remained frozen for about 14 years and that CBK had undertaken to compensate it if its claim failed. It also sought legal costs after successfully defending itself against the central bank’s case.
The appellate court dismissed the appeal in September 2024 after finding Johmat had failed to include typed proceedings from the High Court, making it impossible to evaluate the claim for interest.
It also upheld the trial court’s decision on costs before later declining to certify a further appeal to the Supreme Court.
Johmat then asked the Supreme Court to review that refusal, arguing that the dispute raised important constitutional questions touching on property rights, fair hearing and the consequences of freezing private funds.
The five-judge bench declined the request, saying the issues remained confined to the parties before the court and did not meet the constitutional threshold for a final appeal.
“We are not persuaded that they meet the threshold for certification,” the judges said, in a decision that closes one of the longest-running commercial disputes.
The court also found that some of the constitutional questions advanced by Johmat had not been raised before the Court of Appeal.
“An application for review is not a vehicle for advancing arguments that have no footing in the determinations of the superior courts below,” the judges said.
The bench further held that dissatisfaction with how lower courts applied settled legal principles could not, on its own, justify a hearing before the Supreme Court.
“Framing a grievance in constitutional terms does not of itself elevate the issue to the threshold contemplated under Article 163(4)(b) of the Constitution,” the ruling stated.
It added that the questions raised under the constitutional rights to property and fair hearing “identify no unsettled point of constitutional principle bearing on the public at large.”
The judges said Johmat had also failed to demonstrate that the dispute extended beyond its own circumstances or carried broader public importance.
“The applicant has not demonstrated that the issues raised transcend the circumstances of this dispute or have a significant bearing on the public interest,” the court ruled, dismissing the company’s application.
