Ugandan tycoon Tom Mugenga awarded Shs 59Bn by Kenyan court over election violence losses

Ugandan businessman Tom Mugenga, has landed a major win against the Kenyan government in a court case spanning nearly two decades.

Mugenga is a prominent businessman known with investments in clearing and forwarding, real estate, and agro-processing. He is the owner of Mugenga Holdings, Voice of Muhabura FM and a former director at Crane Bank.

Mugenga was one of 16 Ugandan firms awarded compensation by the Kenyan Court of Appeal for losses incurred during the devastating 2007/08 post-election violence. 

The court ordered the Kenyan state to compensate Mugenga Holdings a total of $16,955,000 (about Shs 59billion) after his firm suffered massive damage and disruption.

During the case hearing, Mugenga told court that he lost a fleet of eight trucks in the election unrest. 

He said he was forced to auction his property in Mombasa to settle accrued debts. 

The court awarded his firm $16.8 million in special damages for the lost assets and an additional $155,000 (Ksh20 million) for the seized Mombasa property.

The case, which saw 16 Ugandan transport and logistics firms successfully sue Kenya’s Attorney General and the Inspector General of Police, centered on the State's failure to protect their assets during the turmoil that followed the disputed 2007 presidential poll. 

The companies, which included Intraspeed Logistics Ltd, Dooba Enterprises Ltd, and Wilbex Uganda Ltd, were all involved in cross-border freight operations, moving goods between the Mombasa port and neighbouring countries like Uganda, Rwanda, and the Democratic Republic of Congo. Collectively, they sought damages for more than 20 vehicles and their cargo that were looted or burnt.

Other company heads also detailed the severe consequences of the State’s negligence. 

John Bosco Rusagara, CEO of Intraspeed Logistics, testified on behalf of 15 of the firms, explaining that many were unable to service bank loans after their fleets were destroyed. 

His own firm, which lost six trucks loaded with fuel and tyres, was forced into receivership. Similarly, Faustin Mbundu, managing director of Katraco (U) Ltd, reported that his company lost three trucks, effectively losing all its operating assets.

The Kenyan government had vigorously fought the claim, appealing a High Court ruling and arguing that the violence was spontaneous, unforeseeable, and that the police had fulfilled their statutory duty of care. 

However, the three-judge bench of the Court of Appeal upheld the original finding that the State failed to protect the transporters’ property despite foreseeable risks along the key trade routes.

While the judges dismissed the State's appeal, they did revise the total payout. 

They adjusted the calculation for loss of business from the six years initially awarded by the High Court to only three years, ruling that the compensation must align with what was specifically pleaded and proved by the companies. This revision lowered the total collective award from the original $64.3 million (Ksh8.3 billion) set by the High Court.