REPUBLIC OF KENYA

IN THE COURT OF APPEAL OF KENYA AT NAIROBI

CIVIL APPLICATION NO. 15 OF 2015 (UR 15/2015)

BETWEENOKIYA OMTATAH OKOITI 1ST APPLICANTWYCLIFE GISEBE NYAKINA 2ND APPLICANT

THE ATTORNEY GENERAL 1ST RESPONDENTKENYA RAILWAYS CORPORA TION 2ND RESPONDENTTHE PUBLIC PROCUREMENT OVERSIGHT AUTHORITy ,3RD RESPONDENTCHINA ROAD AND BRIDGE CORPORATION 4TH RESPONDENTLAW SOCIETY OF KENYA 5TH RESPONDENT

PUBLIC ANNOUNCEMENT AS DIRECTED BY THE COURTOF APPEAL OF THE REPUBLIC OF KENYA

1. The Government of the Republic of Kenya and the citizens of Kenya;

2. The Government of the Peoples Republic of China and the citizens of China;

3. The Government of the Republic of Uganda and the citizens of Uganda;

4. The Government of the Republic of Rwanda and the citizens of Rwanda;

5. The Government of the Republic of Burundi and the citizens of Burundi;

6. The Government of the Republic of Tanzania and the citizens of Tanzania;

7. The Government of the Republic of South Sudan and the citizens of South Sudan;

8. The Government of the Democratic Republic of the Congo and the Citizens of DRC;

9. The Export Import (EXIM) Bank of China; and

10. All members of the public, contractors, sub-contractors, consultants, employees, and

all parties with an interest in the Nairobi-Mombasa Standard Gauge Railway

In compliance with Rule 7i of the Court of Appeal Rules, and Pursuant to the orders of the

Court of Appeal of the Republic of Kenya (Coram: Vishram, Mwera, Sichale JJ. A), issued in

Nairobi on Monday, the 6th day of July, 2015, when the above matter came up for hearing,

that to avoid a situation in which the Court issues adverse orders without the knowledge of

unknown parties likely to be affected, we, the applicants herein do hereby comply fully by

putting out this public announcement.

On 23rd January 2015, under Rule 5(2)(b) of the Court's Rules, we filed a Notice of Motion~

application, dated 5th January, 2015, seeking orders stopping the on-going construction of

the Standard Gauge Railway from Mombasa to Nairobi, pending hearing and determination

liPageof7PUBLIC ANNOUNCEMENT AS DIRECTED BY THE COURT OF APPEAL OF THE REPUBLIC OF KENYA

of our Civil Appeal No. 13 of 2015. We did so to protect our Civil Appeal No. 13 of 2015 from

being overtaken by events and rendered nugatory in the event it succeeds,

1. THAT the procurement of the Mombasa-Nairobi Standard Gauge Railway

(hereinafter, lithe SGR") is a nullity in law because it was done in gross and

blatant violation of the Constitution of Kenya 2010, the Public Procurement and

Disposal Act 2005, The Public Finance Management Act 2012, and other laws of

Kenya. (See our submissions in the Superior Court, annexed at pages 1225 to

1238, of Volume Three of the Notice of Motionii.)

2. THAT the two contracts for the SGR are a fraud on the public, constituting the

theft of some US$ 287,272,630.99, equivalent to Kshs 28,596,804,476.98(at

current exchange rate of 1 USD = 99.5459 Kshs). Further and in particular:

a. Double/Ghost Procurements resulting in the theft of US$111,320,988.43 or

Kshs 11,081,544,835.46:

i. In the Contract for Civil Works, at Item 3 on Page 704 (of Volume Two

of the Notice of Motion), the design and construction supervision

services are awarded in the Contract at the highly inflated and huge

cost of 3.5% of the total value of Bills in the Contract, and which

equates to a sum of Kshs. 7,061,417,879.21 equivalent then to US$

84,939,782.80 (at the exchange rate of Kshs 83.1344 applicable as

stated in the Contract at page 679 of the Volume.

ii. In the Contract for the Installation of Facilities, Locomotives and

Rolling Stock, at page 558 (of Volume Two of the Notice of Motion),

the design and construction supervision services are awarded at the

highly inflated and huge cost of 2.5% of the total value of Bills in the

said Contract at US$ 26,381,205.63.

Hi. Now, on 15th May, 2014, the 2nd Respondent competitively awarded

the International Tender No. KRC/PLM/009/13-14, to Messrs

TSDI/APEC/EDON to provide the same design and construction

supervision services in (i. & ii. above) at US$ 41,184,638.00. See Page

1312 of Volume Three.

iv. Benefits of competition over single sourcing are clear here. The hugeA

price difference, of some US$70,136,352.43 (i.e., US$111,320,988.43~

US$ 41,184,638.00) shows the significa'nce of procuring through

competitive bidding, and underscores the Applicants' contention that

huge savings could have accrued to the taxpayers if the SGR project

was subjected to competitive procurement.

b. Price Inflation by US$ 175,951,642.56 (equivalent currently to Kshs

17,515,259,641.52: Contrary to the formula given for variation in binding

contract prices at pages 551, 660, and 695 (of Volume Two of the Notice of

Motion), there are irregular price variations inflating the prices of the

Contracts thus:

i. In the Contract for the Installation of Facilities, Locomotives and

Rolling Stock, at page 558 of Volume Two, the price is inflated by 5%

by way of price adjustment for a value of US$ 54,609,095.66 and this

is not qualified and is without justification.

ii. In the Contract for Civil Works, at page 704 of Volume Two, the price

is inflated by 5% by way of price adjustment for a value of Kshs

10,087,739,827.45 (equivalent then to US$ 121, 342,546.90) and this

is not qualified and is without justification.

iii. Refer also to the reference in Paragraph F) on Page 723 to the fact

that the Kenya Railways experts protested that the unit prices of

some items were too high, resulting in a price reduction of the prices

by Kshs 2,641,283,124.69 as provided at Page 726.

i. Although Kenyans have been led to believe that the Government is

procuring a Standard Gauge Railway, the said commercial contracts

show that the Mombasa-Nairobi line will be built to the undefined

'Chinese Railway Design Standard. See pages 718, 727 - 729;

"Technical Standards" on Page 550; and Item 5 on Page 215 of

Volume 1.

ii. The government has always maintained that no competitive tender

was floated for the Mombasa-Nairobi phase of the SGR because it was

a "government-to-government" arrangement, yet the financial

contracts are between the GoK and "Financial Institutions of China,"

See Item "14. Contract Price and Payment," on Page 737 of Volume

Two.

i.ii. Concealment of the fact that the Kenya Railways Corporation experts

dismissed and rejected the project's Feasibility Study Report, dated

January 2011. See pages 2060 - 2070 of Volume 4. On 14th March,

2013, KR even withdrew the award. See Page 2476 of Volume 5.

iv. There is no evidence in the budgets of Uganda and Rwanda that the

said regional governments/countries are part of the SGR project. For

example, Uganda's National Budget for the year 2015/2016 has no

provisions for the project. Refer to the section titled, Railway

Transport, at Paragraph 85 on pages 32 and 33 of the document titled

1st and 2nd Applicants' List of Documents.

i. Refer to the protest letters from the Kenya Forest Service, Museums

of Kenya, and the Kenya Wildlife Service, respectively, pages 1302,

1303, and 1304.

ii. Procurement of the obsolete polluting diesel engines and not the

modern environmentally friendly electric ones.

5. The lack of due diligence in the rushed conclusion of contracts as captured in

paragraphs 18, 21, 22, 42 and 43 of the 2nd Respondent's Replying Affidavit,

dated 20th February, 2014, (See pages 1572 and 1575 of Volume Four of the

Notice of Motion) points to total lack of due diligence. It is inconceivable that in

less than 15 days, from 26th June 2012 (when the 2nd Respondent approved the

feasibility study) to 11th July 2012 (when a commercial contract for civil works

was signed), the following supposedly happened:

i. The negotiating team was formed;

ii. Negotiates the commercial contract;

iii. The commercial agreement is endorsed by the management of both

the 2nd and the 4th Respondents;

iv. The 2nd Respondent seeks and gets approval from Ministry of

Transport and from the Hon. Attorney General;

v. The Board of the Kenya Railways Corporation is convened with the

award of the contract as an agenda;

vi. The Board meeting is held which approves the contract;

vii. The 4th Respondent is notified of the award and accepts the award;

and

viii. The contract is signed!

6. THAT being governed by the laws of Kenya (see Vol. Two: "Law and Language" on

pages 548 and 687, and the "Disclosure Clause" under "Compliance with Laws,"

on page 688 of the Notice of Motion, the two SGR contracts between the 2nd and

the 4th Respondents are a nullity in law because they are a result of an

unreasonable, irregular, illegal, corrupt and, therefore, an unconstitutional

process which is a nullity ab initio in Kenyan law? They are also a nullity under

the arbitration mechanisms agreed in the Contracts. In the case of World Duty

Free Company Limited vs. The Republic of Kenya, the International Centre for

Settlement of Investment Disputes dismissed the claim advanced by World Duty

Free Limited because it was tainted with bribery (corruption). See authority in

the Applicant's Supplementary List of Authorities/Documents.

• See Paragraph 138 on Page 41. The concept of public policy ("ordre public")is rooted in most, if not all, legal systems. Violation of the enforcing State'spublic policy is grounds for refusing recognition or enforcement of foreignjudgments and awards. The principle is enshrined in Article V.2 of the NewYork Convention of 10 June 1958 and Article 36 of the UNCITRALModel Lawrecommended by the General Assembly of the United Nations on 11December 1985.

7. THAT for being unconstitutional null and void ab initio, the SGR contracts are

voidable by Honourable Court of the Republic of Kenya, and the Court should

void them and stop their implementation, inter alia, for the following reasons:

a. Articles 2(1),(2)(3) & (4) of the Constitution deny the Court any discretion to

act otherwise. In particular, the express wording of Article 2(4) addresses

itself to fait accompli. The end can never justify the means under Kenyan law.

By dint of Articles 24 and 25, only provisions out of the Bill of Rights can be

limited through legislation; all other provisions are absolute. And by dint of

Article 255(a), Article 2 can only be amended via a national referendum.

b. Under international law and the doctrine of odious debts, obligations which

result from the deliberate mischief of the government of the day are regime

obligations and not sovereign obligations.

c. The political arms of Government (i.e. the legislature and the executive) lack

the capacity to do by their treaty making powers that which the Constitution

forbids.

d. In the balance of things, and given Kenya's public policy of zero tolerance to~

corruption, the overwhelming public interest in the matter lies with

upholding the Constitution as the Supreme Law of the land, which is an

51Pageof7

absolute bar to anything done in its contravention. It is our contention that

there will be no injury to the 1st - 4th Respondents in stopping the

construction of the irregularly and illegally procured SGR. Otherwise, any

injury would be self-inflicted by the Respondents since they contemptuously

disregarded the Constitution and Kenya's procurements laws. Further, any

injury to the said Respondents can easily be compensated in damages while

disregarding the Supremacy of the Constitution will unleash anarchy upon

the Republic.

e. To avoid any injustice in the circumstances before us, the principle of

proportionality enjoins the Court to deal with this matter in a way that is

proportionate in the long term, including taking into account the fact the

Court has no capacity to waiver the Supremacy of the Constitution.

8. THAT there is no urgency in the construction of the SGR:

a. Only the tiny Mombasa-Nairobi phase is being constructed of what is being

billed as a regional project.

b. No feasibility studies and financing agreements are in place or are being

undertaken for the Nairobi-Malaba/Kisumu phase.

c. Constructing only the Mombasa-Nairobi phase will only facilitate the

transportation of goods between the two towns not the region.

d. If the Mombasa-Nairobi phase will take so long, when will the railway cross

the difficult terrain of the Rift Valley to reach Malaba/Kisumu, let alone

reaching Kampala and Kigali?

e. Read Paragraph 85 pages 32/33 of Uganda's 2015-2016 budget speech.

a. To determine that the State and its organs, like the 2nd Respondent, are

persons who enjoy the rights and fundamental freedoms in the Bill of Rights,

and that they can hold those rights up as an absolute bar against demands by

citizens that they be transparent and accountable?

b. To determine that the Court was not a legitimate authority for purposes of

fighting corruption, and that it could NOT entertain whistle blowers.

c. To apply the Evidence Act to constitutional proceedings brought under

Articles 22 and 258 and the Mutunga Rules.

e. To strike out the documentary evidence supporting the petitions by the

Applicants and the 5th Respondent. Further and in particular, there was

absolutely no reason, other than express mischief and improper motive on

the part of the Superior Court, to strike out the documents as it does on page

111 of Volume One.

10. THAT the Superior Court was biased and aided and/or abetted corruption in the

procurement of the SGR.

OKIYA OMTATAH OK1ST APELLANT

(1) An intended appellant shall, before or within seven days after lodging notice of appeal, servecopies thereof on all persons directly affected by the appeal: Provided that the Court may onapplication, which may be made ex parte ,within seven days after lodging the notice of appeal,direct that service need not be effected on any person who took no part in the proceedings inthe superior court.

(2) Where any person required to be served with a copy of a notice of appeal gave any addressfor service in or in connection with the proceedings in the superior court, and has notsubsequently given any other address for service, the copy of the notice of appeal may beserved on him at that address, notwithstanding that it may be that of an advocate who has notbeen retained for the purpose of an appeal.

The entire 2509-pages long Notice of Motion and other pleadings in the matter may beobtained from the Nairobi Registry of the Court of Appeal of the Republic of Kenya.