A vicious court battle between Ufundi Savings and Credit Co-operative Society Limited has been settled after court gave a green light to the sale of Ufundi Co-op Plaza.
Ending an eleven years dispute, Environment Court ordered that the land and the plaza co-owned by the sacco and the investing members, should be sold and the proceeds should be shared after clearing a Sh254 million debt owed to Co-operative Bank.
Justices Eric Obaga, Kossy Bor and Bernand Oboso ordered that all the rent collected from the building should be released to Co-op Bank to redeem the title used as security to the loan.
The sacco, with 14,999 members, will get 58.88 per cent while the members will take home 49.12 per cent of the proceeds.
The split between the Sacco and the members emerged on April 29, 2010 when the Sacco sought to sell the plaza.
The members however resolved to de-link themselves and claimed the property.
The property in dispute was a replacement of the original one previously purchased by members in 1986 at a cost of Sh30 million and adjacent to the American Embassy, which collapsed during the bomb blast in August 7, 1998.
In the tribunal case, the members wanted the sacco officials barred from disposing the property at the same time seeking for a declaration that the property belongs to 14,999 members.
The tribunal was also asked to compel Ufundi officials to furnish the members with detailed account of rent collected from the building.
In 1998, the sacco had 30,000 members who were majorly government parastatal employees.
The decision to buy the original building as an investment venture was arrived at by 15,000 members of the sacco.
They contributed Sh12 million and the sacco procured a loan of Sh18 million on their behalf from the Co-operative Bank.
Each member contributed Sh2,100 each, which was deducted from his or her savings and wages at the rate of Sh40 per month.
The loan was fully repaid in 1989 through rental income from the newly-acquired building, then known as Gateway House, where the sacco was a tenant.
However, members could not register the building in their name since they were not a separate entity even though they had bought the building independent of the sacco.
It was then agreed that the building would be registered in the name of Ufundi Co-operative Savings and Credit Society Ltd.
The building as renamed Ufundi House and each of the 15,000 members were issued with a share certificate as confirmation of their shareholding investment in the building.