THE state has exposed its soft underbelly by failing to file and serve a defence in a suit in which a plastic bags manufacturer seeks KSh2 billion compensation for business lost.
Hi-plast, through its lawyer Eddy Orinda, has won the first round of the court tussle in an application in which it sought that judgment be entered against the AG , read State, for failure to make an appearance or pleadings in the compensation case.
Trial judge Onesmus Makau directed that the matter comes to a closure within a month.
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The judge has since taken issue with the AG’s failure to file a defence and serve Hi-Plast limited company.
A representative from the AG told the judge that the state was under the assumption that after the Kenya Association of Manufacturers (KAM) case against the plastic ban was thrown out the matter had rested there… res judicata, and assumed “the new case compensation would equally fall.”
“The defendants have defaulted in entering appearance and has further failed to file any appropriate defence,” lawyer Eddy Orinda told the court.
According to Orinda, the state actors including NEMA have neglected or refused to act despite knowing that the matter is alive in court.
“To date the government has not entered appearance or filed papers in opposition of the suit in court and that is why we have sought leave before the judge seeking authorization for judgement in default of the application we had made earlier”, Orinda said.
The trial court heard that the AG did not serve Hi-plast, prompting the judge to direct that the state “considers how to settle the matter.”
Threw in the towel
In failing to serve a defence, the state naturally threw in the towel, giving leeway for a judgement to be entered in favour of Hi-plast.
Hi-Plast had earlier sought an order to quash the gazette notice by the Ministry of Environment, banning the manufacture and use of plastic bags.
The high court already delivered a judgement in a separate case filed by Kenya Association of manufactures(KAM) in which the latter lost.
Hi-plast director , Mahesh Dodhia, in suit papers says the ban caused him unimaginable losses, having invested heavily in machinery and raw materials as well as defaulted on loan repayments.
Already he is facing liquidation.
Dodhia says in a sworn statement that the ministry should have at least engaged the stakeholders before imposing the ban, which would have helped mitigate the losses.
“The petitioner’s loans were to be repaid solely based on sales projection that were hinged on month on month output and sales of its products which are now deemed illegal,” the company’s lawyer Orinda says.
The firm also claims that the declaration of the ban and its implementation came abruptly before and “adequate and reasonable notice.”
Hi-Plast accuses the ministry of disregarding a parliamentary committee’s call for the shelving of the gazette notice leading to the ban.
Dodhia further accused the ministry of abetting other manufacturers, whom he claimed continue to produce plastic bags.
He added that the ban seems to have been effected to prop up the businesses of friendly manufacturers, a move he terms discriminatory and malicious.
He stated that at time the Gazette Notice was published in March 2017, the company had already shipped in raw materials.
In law, justice Makau said, not serving amounts to not filing a defence.
He has now directed Hi-plast to file in submissions in seven days before returning to court for further directions.
The state has equally been directed to file submissions and confirm compliance on October 31 2018.