NAIROBI, Kenya, Aug 26 – Lawmakers have raised questions over the Insurance Regulatory Authority’s (IRA) payment of Sh342.8 million to a law firm following a protracted dispute over legal fees.

📻 Breaking It Down

The payment came under scrutiny on Wednesday when the Public Investments Committee on Commercial Affairs and Energy questioned how the law firm was allowed to represent the regulator in court before a final agreement on its fees had been reached.

The committee, chaired by Pokot South MP David Pkosing, also raised concerns over Sh79.8 million in interest that accrued after IRA delayed settling an earlier court award in favour of the law firm.

According to the Auditor-General’s findings, IRA engaged the firm to represent it in a legal dispute involving a liquidated insurance company that had sued the regulator.

📌 What You Need to Know

However, the two parties failed to agree on the final amount payable for the legal services.

The advocate initially sought Sh176.1 million in legal fees, calculated on the basis of the claim made by the liquidated insurer.

IRA, however, disputed the amount and was willing to pay Sh875,197, based on the audited financial statements of the insurance company involved in the dispute.

The disagreement eventually escalated into a court battle, with IRA challenging the award.

The regulator failed to secure a stay of execution, while subsequent attempts by its management and board to resolve the matter through mediation also collapsed.

The law firm subsequently sought garnishee orders to compel IRA to settle the amount awarded by the court.

📰 Source: Capital FM Kenya