New disputes over ownership and management of the grocery store giant and their father’s business have upset the extended family of the late Peter Mukuha Kago, the founder of Naivas, the nation’s largest supermarket chain.
Three of the late Kago’s children have filed simultaneous court applications to take their brother’s position as the administrator of their father’s estate, and this case is at the core of the current dispute.
In lieu of their brother Simon Gashwe, who passed away in August 2019, Newton Kagira Mukuha, his sister Grace Wambui, and his brother David Kimani Mukuha have applied to the Nakuru High Court to be named administrators of the multibillion-shilling estate.
While receiving care at Nairobi’s Aga Khan Hospital in August 2019, Gashwe, the former chairman of Naivas Supermarkets, passed away.
The late Gashwe was the executor of his father’s whole estate, and documents indicate that he held 25% of Naivas’ shares. On May 6, 2010, he was named the ruling family’s sole administrator.
In his court filing, Mr. Kagira expresses his concern that the inheritance would be mismanaged because of a lack of counsel and that it would probably be plundered by unknown individuals.
He claims that there is enough justification to cancel the letters of administration and name a new one in light of Gashwe’s death.
When Gashwe passed away in 2019, he asserted that the division of their father’s assets was still pending. Some assets, he says, have not been disbursed.
He points out that the late Gashwe’s involvement is necessary for the ongoing appeals to progress.
“It is in the best interests of the assets left by the deceased and justice that alternative arrangements be carried out so that the objectives of the remaining assets are appropriately protected,” adds Kagira.
Conversely, David Kimani asserts that his siblings, Teresia Njeri, Charles Mukuha Gashwe, Grace Muthoni, Ruth Wanjiru, Hannah Njeri, and Linet Wairimu, approved of his selection as interim administrator.
He maintained that the designation of the petitioners, Mr. Kagira and Mr. Wambui, as administrators had not had the approval of any of Mr. Gashwe’s heirs.
After accusing Mr. Kagira of bringing lawsuits against the estate and therefore creating a potential conflict between himself and the estate by being both a plaintiff and a candidate for appointment administrator at the same time, Mr. Kimani rejected Mr. Kagira’s application.
He said that the late Gashwe had finished the procedure by distributing the estate to each beneficiary before his death.
“In the unlikely scenario that the probate judge finds that the management of the estate of Peter Mukuha Kago is necessary, the court will certainly be delighted to issue letters of administration to David Kimani Mukuha as stipulated by the other beneficiaries,” Mr. Kiman wrote in his application.
In her application, Ms. Wambui states that Gashwe was chosen as trustee with approval from the family in order to oversee the estate, divide it among the relatives, and settle debts.
She adds that there are other court issues ongoing on behalf of her father’s estate and that her brother Gashwe passed away before the administration was finished.
According to Ms. Wambui, there has been an incorrect distribution of part of her late father’s property, and an administrator or administrators are required to settle the conflict. She is open to working with Kagira as a joint administrator.
“We consequently respectfully request the court to accept both petitions and revoke the appointment of May 6, 2010, and additionally pray the original grant be reprinted to Grace Wambui Mukuha to serve as the new administrator of the estate,” they said.
Newton Kagira Mukuha, the oldest of the three Naivas brothers, who have been embroiled in a power struggle over Naivas Supermarkets since 2013, has reopened his legal battle over the retail business at the Milimani Law Courts in Nairobi.
Since 2013, Mr. Kagira and his younger brothers have been engaged in a power struggle over the multibillion-shilling company.
Mr. Kagira claims that his brothers, the late Simon Gashwe and another, Mr. David Kimani, conspired illegally to deny him the right to inherit from his father’s shares in Naivas and to remain an unregistered owner.
Newton Kagira Mukuha retained the esteemed Ahmednasir Abdullahi Advocates LLP in March 2023 to defend him in the most recent legal dispute over a share of the massive retail business.
Lawyers at Ahmednasir Abdullahi Advocates LL began the lawsuit by requesting the current ownership structure of Naivas Limited in a letter to the Registrar of Companies.
The legal firm also requested copies of all returns the shop has filed since its founding, along with any updates to the business after the recent purchase of shares by private equity companies.
Naivas Limited criticised Kagira last year, stating that he was an outsider attempting to claim stock in the massive business.
Naivas characterised Kagira as an outsider with no legitimate claim to the corporation during its case before the Milimani High Court in Nairobi.
“Kagira, the petitioner, has no valid grounds or supporting documentation to request an order of protection to keep the company’s assets and shares from being taken away. The court is unable to determine whether Kagira has a registered legal interest in the business.”
Through its solicitors, Coulson Harney, Naivas said that Mr. Kagira “has never been a legal or beneficial owner of the company’s shares and cannot prevent the company from selling its shares or assets.”
According to Naivas, the High Court rejected Kagira’s lawsuit in 2016, in which he demanded a 20% stake in Naivas Limited.
According to Naivas, Mr. Kagira has illegally returned to the High Court in Milimani, Nairobi, in order to halt the company’s activities, even while his appeal is still ongoing at the Court of Appeal.
On April 3, 2023, he appeared in court to prevent the corporation from liquidating its assets and shares.
Kagira asserted that he was the proprietor of Naivas Limited, citing his 20% founding capital contribution at the company’s 1990 founding.
Mr. Kagira had already applied to the Nakuru Court of Appeal under a certificate of urgency, but the High Court had denied his claims to ownership of the corporation. This was in August of 2021.
The late Simon Gashwe (25 percent), Ms. Linet Wairimu (15 percent), Ms. Grace Wambui (15 percent), and the late Peter Mukuha Kago (20 percent) are the listed directors of Naivas Supermarket.
Kagira claims that the Court of Appeal in Nakuru issued an order on November 25, 2021, mandating that the disputed shares’ status quo be preserved while the appeal is being decided.
He did, however, advise the court that he had learned from reliable sources that the business was selling its shares, including the contested ones, via its directors and stockholders.
He went on to say that he may lose both his original investment and any dividends that came from the contested shares in the future.
Kagira is requesting that Gashwe’s letters of administration be revoked.
According to him, Gashwe passed away before the distribution of her late father’s estate’s holdings, which included cash in Barclays Bank (now ABSA Bank), shares in Standard Chartered Bank, cash in Kenya Commercial Bank, and a 20% stake in Naivas Limited.
Kagira contends that the loss of Gashwe is a good reason to cancel the letters of administration.
He said that the issuing of a fresh grant will expedite the process of apportioning parts of the inheritance to the appropriate recipients.
According to court documents, Kagira stated that her late father, Kago, had called a family meeting in December 1989. She said that Kago, Kimani, Grace Wambui, Linet Wairimu, Robert Njau, and Mukuha’s late father, Simon Gashwe, had all attended. At the meeting, the family reportedly discussed and decided to launch a business.
“Kimani deposited Sh10,000, Kago Sh30,000, Wambui Sh25,000, Kagira Sh20,000, and Wairimu Sh15,000, totaling Sh100,000,” according to Kagira’s court documents.
“The family decided that each person’s contribution would serve as the foundation for their sharing in the business, “he said.
Newton Kagira contends that he attended the aforementioned meeting, which was purportedly held in his Cherangany, Kitale, house by Peter Kago, the creator of the store, and at which donations were made in order to establish the business.
Nevertheless, he said that despite having donated 20% of the shares, family members ignored him and disparaged him as a stakeholder.
On May 6, 2010, Peter Kago Mukuha passed away, leaving behind assets valued at billions of shillings, which included the Naivas Supermarkets network.
On October 6, 2016, Simon Gashwe Mukuha was selected as administrator after submitting an application for letters of administration. On the other hand, he faced a lawsuit by his brother Kagira, who claimed he had been left out of the will’s distribution.
Nevertheless, he passed away on August 26, 2019, before the cases were resolved.