Kenyan Court Rejects Somali Embassy's Appeal to Unfreeze Accounts over Sh25m Contractor Debt

The Somalia government has encountered a setback in its attempt to lift an order attaching its bank accounts over a Sh25.6 million debt owed to a Kenyan contractor.

Justice Alfred Mabeya of the High Court on Thursday dismissed an application by Somalia's Attorney General to lift the order, which had been granted to Kingsley Construction Limited in the previous year. The order had attached Somalia's accounts at Premier Bank Limited. The case stems from a successful lawsuit by Kingsley Construction Limited against the Government of Somalia in 2019, alleging breach of contract for the renovation of Somalia's embassy in Nairobi. Somalia challenged the decision, arguing that it enjoyed diplomatic immunity, rendering the decision illegal. However, Justice Mabeya rejected this argument, asserting that Somalia cannot invoke sovereign immunity to evade legal accountability for its commercial dealings.

The court emphasized that the transaction in question was a commercial contract as it involved repair works on the embassy in Nairobi. Justice Mabeya stated that the doctrine of sovereign immunity does not extend to commercial activities, explaining that when a state or its entities engage in commercial transactions, they forfeit the protection typically granted to sovereign acts. While Article 31 of the Vienna Convention on Diplomatic Relations (1961) grants diplomatic agents immunity from civil and administrative jurisdiction of the host state, there are exceptions to this immunity. One key exception pertains to commercial activities conducted outside the scope of a diplomat's official functions. The court noted that the bank had confirmed it held sufficient funds to repay the debt.

In an affidavit, Mr. Jabril Ibrahim Abdulle maintained that Kenya and Somalia are sovereign equals under International Law, and therefore the embassy and its officials should enjoy immunity before Kenyan courts. He argued that the court had been misled into enforcing execution against the bank accounts of a foreign sovereign state's embassy. Mr. Abdulle also stated that the attached bank accounts contained funds from application and processing fees paid by individuals seeking passports and visas at the embassy. The dispute originated in 2019 when Kingsley Construction Limited sued the embassy over a 2016 contract to renovate its premises in Nairobi.

The firm claimed that the embassy breached the agreement by denying its staff access to the project site on Jabavu Likoni Lane, off Dennis Pritt Road, and failing to pay the outstanding sum of Sh23.4 million. The contract was allegedly terminated without notice, and the Somalia embassy failed to mount a defense despite being served. In a broader context, this legal dispute reflects the ongoing challenges faced by Somalia in managing its financial obligations and legal disputes. Despite recent progress in securing debt relief from international creditors, including a $4.5 billion debt relief deal from the International Monetary Fund and the World Bank, Somalia continues to grapple with financial and legal challenges.