The High Court has stepped in to stop the National Treasury from paying a contractor involved in the IFMIS tender, after a debt of Sh212.8 million owed to its partner remained unsettled.
The ruling follows a long-running dispute over payments and enforces an arbitration award that had already been converted into a court decree.
The court clarified that while government property cannot be seized, it is lawful to attach debts owed by the government to private parties.
It directed the Principal Secretary at the National Treasury to ensure that no funds under the IFMIS contract are released to Kingsway Business Systems Limited until the outstanding debt to Kobby Technologies Limited is fully cleared.
The disagreement traces back to a 2019 tender issued by the National Treasury for IFMIS services. The tender aimed to provide on-site support for IFMIS e-Procurement and other financial systems across government ministries and semi-autonomous agencies.
In February 2021, a consortium of Kingsway Business Systems, Kobby Technologies, and Inplenion Eastern Africa won the tender, which was valued at Sh647 million and scheduled to run for three years.
Kobby Technologies’ share of the contract amounted to Sh303.9 million in professional fees.
A conflict arose in March 2021 over a subcontract between Kingsway and Kobby, which was later referred to arbitration. In October 2022, the arbitrator ruled in favour of Kobby Technologies. The award was incorporated into a High Court decree in July 2024, granting Kobby Sh165.8 million, plus interest and costs.
After Kingsway failed to pay, Kobby applied to attach funds owed by the Treasury to Kingsway under the same tender. In February 2025, the court issued a garnishee order for Sh212.8 million against the government.
Despite the order being served, the Treasury did not make payment, leading Kobby to request judicial review orders against both the Attorney General and the Principal Secretary at the National Treasury.
Wednesday’s ruling affirmed that Kobby had met all legal requirements for the garnishee order. The judge confirmed that both the decree and the garnishee order remain valid and enforceable, allowing Kobby to recover the debt owed under the IFMIS contract.
