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Kenya’s High Court has backed I&M Bank in its effort to recover Sh864.7 million ($6.7 million) from Buzeki Enterprises Ltd., a logistics company owned by businessman and politician Zedekiah Bundotich Kiprop, popularly known as Buzeki.
The ruling allows the lender to enforce a promissory note issued by Buzeki Enterprises, closing a dispute that began in 2019 and centered on the purchase of heavy trucks and trailers valued at more than Sh864 million. A promissory note is a written promise to repay a specified sum, and the court said this one carried no conditions.
In a decision that emphasized commercial certainty, the judge found that the promissory note signed in October 2016 amounted to a valid, unconditional promise to pay a fixed amount on a fixed date, Nov. 30, 2016. The court said it could not be undermined by claims that other understandings sat behind it.
“The instrument is pristine,” the judge said, noting it contained no mention of Taru Ranch, no land sale references and no contingencies. The court said the face of the document controlled, and the maker was bound by what was written.
The dispute traces back to a deal between Buzeki Enterprises and RT (East Africa) Ltd. for the supply of more than 100 trucks and trailers. Buzeki Enterprises issued promissory notes totaling Sh864,758,278 to settle the purchase price.
RT, a customer of I&M Bank, later assigned the promissory note to the bank as security. The bank said it discounted the note, advancing funds to RT based on Buzeki Enterprises’ payment commitment. When the note matured, no payment was made, and the bank went to court as the holder of the instrument.
Buzeki Enterprises challenged the claim, arguing payment was tied to the sale of Taru Ranch in Kwale County, which had not happened, meaning the debt had not crystallized. The company’s director testified that the promissory notes were not intended to create immediate liability.
The court rejected that argument, saying oral conditions could not be used to rewrite a negotiable instrument without undermining its purpose. Allowing such evidence, the judge said, would convert a note payable at a fixed time into one payable only on a contingency.
The judge also faulted Buzeki Enterprises for raising the Taru Ranch narrative late, saying it was not pleaded in the original defense and amounted to litigation by ambush.
Another issue was whether I&M had a right to sue, given the original supply deal was between Buzeki Enterprises and RT. The court said RT assigned its right to receive payment to the bank, and Buzeki’s consent was not needed because its obligation did not change.
The court entered judgment for I&M Bank for Sh864.7 million, with interest at court rates from the date the case was filed, and ordered Buzeki Enterprises to pay costs.
