KPA ordered to re-advertise high-value legal services tender

The High Court in Nairobi has ordered Kenya Ports Authority (KPA) and Public Procurement Regulatory Authority (PPRA) to re-advertise the tender for prequalification to provide legal services.

On June 9 2020, KPA advertised for 20 law firms with sound financial muscle, insurance cover and experience to handle its multi-billion shilling legal suits.

Yesterday, Justice James Makau said the advertisement by KPA contravenes Article 227 of the Constitution, Section 60 of the Public Procurement and Asset Disposal Act, 2015 and Section 9 of the Advocates Act, Cap 16 Laws of Kenya.

KPA intended to prequalify the law firms grouped into categories A, B, C and D with each required to have a minimum professional indemnity cover of Sh200 million, Sh100 million, Sh50 million and Sh20 million respectively.

However, the conditions for pre-qualification to offer legal services sparked a court dispute between small law firms and established ones.

The smaller firms termed the conditions as punitive and in favour of the bigger firms.

In his judgement delivered yesterday, Justice Makau said the tender is discriminatory and has violated constitutional provisions as well as statutory provisions.

“I have carefully considered the petitions and the issues raised therein and I am satisfied that the petitions are based on the Constitution,” said Justice Makau.

The judge prohibited and restrained KPA and PPRA from receiving, assessing, considering, evaluating and processing bids and tender documents received from law firms in respect of Tender No KPA/160/2019-20BLS-prequalification of Legal Services, in its current form.

“An order of prohibition be and is hereby issued to prohibit Respondents (KPA and PPRA) from implementing or seeking to enforce the implementation of, or further implementation of KPA/160/2019-20/BLS June 2020 titled prequalification of law firms for provision of legal services to KPA,” said Justice Makau.

In June 2020, Law Society of Kenya (LSK) and High Court lawyer Willis Oluga filed different petitions in Mombasa and Nairobi challenging the prequalification conditions for the legal services.

Oluga said the mandatory condition imposed by KPA in their tender advertisement requiring at least one partner in the bidding law firms to be a Certified Arbitrator is illegal, discriminatory, excessive, oppressive, prohibitive, unfair, unjustified, unconstitutional and therefore null and void.

He said the pre-qualification requirement was deliberately imposed by KPA to favour certain firms.

Justice Makau said LSK and Oluga proved how the tender contravenes Article 227 of the Constitution and the provisions of the Public Procurement and Asset Disposal Act.

KPA’s advocate John Turasha Kinyanjui argued that the magnitude of legal services KPA outsources often run into billions of shillings, hence requiring experienced firms.

Kinyanjui cited an incident in which KPA was involved in a Sh580 million dispute emanating from damage to undersea cables caused by a ship contracted for dredging works and whose arbitration seat was in London.

“KPA’s requirement for minimum insurance cover (professional indemnity), arbitration certification and demonstrable expertise as required in the tender are justified, fair and prudent,” said Kinyanjui.

On July 3, 2020 Justice Eric Ogola issued conservatory orders temporarily stopping the tendering process by KPA pending hearing and determination of the petition. 

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